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: 811-21784

Name of Fund:    BlackRock Enhanced Equity Dividend Trust (BDJ)

Fund Address:    100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Enhanced Equity

Dividend Trust, 55 East 52^nd Street, New York, NY 10055

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

Date of fiscal year end: 12/31/2018

Date of reporting period: 12/31/2018

 

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Item 1 – Report to Stockholders

 

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DECEMBER 31, 2018

 

ANNUAL REPORT

 

BlackRock Energy and Resources Trust (BGR)

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

BlackRock Enhanced Equity Dividend Trust (BDJ)

BlackRock Enhanced Global Dividend Trust (BOE)

BlackRock Enhanced International Dividend Trust (BGY)

BlackRock Health Sciences Trust (BME)

BlackRock Resources & Commodities Strategy Trust (BCX)

BlackRock Science and Technology Trust (BST)

BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

 

 

 

Not FDIC Insured • May Lose Value • No Bank Guarantee

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2		THIS PAGE IS NOT PART OF YOUR FUND REPORT

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Supplemental Information  (unaudited)

 

Section 19(a) Notices

BlackRock Energy and Resources Trust’s (BGR), BlackRock Enhanced Capital and Income Fund, Inc.’s (CII), BlackRock Enhanced Equity Dividend Trust’s (BDJ), BlackRock Enhanced Global Dividend Trust’s (BOE), BlackRock Enhanced International Dividend Trust’s (BGY), BlackRock Health Sciences Trust’s (BME), BlackRock Resources & Commodities Strategy Trust’s (BCX), BlackRock Science and Technology Trust’s (BST) and BlackRock Utilities, Infrastructure & Power Opportunities 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 its fiscal year and may be subject to changes based on tax regulations. Each Trust will provide a Form 1099-DIV each calendar year that will tell you how to report these distributions for U.S. federal income tax purposes.

December 31, 2018

 

		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*		$	0.272552			$	—			$	—			$	0.658648			$	0.931200				29	%			—	%			—	%			71	%			100	%
CII*			0.165678				—				0.128622				0.699300				0.993600				17				—				13				70				100
BDJ			0.177394				—				0.383006				—				0.560400				32				—				68				—				100
BOE*			0.295560				—				—				0.550440				0.846000				35				—				—				65				100
BGY			0.162370				—				0.281030				—				0.443400				37				—				63				—				100
BME*			0.069995				—				1.590526				0.739479				2.400000				3				—				66				31				100
BCX*			0.209697				—				—				0.409503				0.619200				34				—				—				66				100
BST			—				—				1.760278				—				1.760278				—				—				100				—				100
BUI*			0.474884				—				—				0.977116				1.452000				33				—				—				67				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 at 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 distribute the following fixed amounts per share on a monthly basis as of December 31, 2018:

 

Exchange Symbol		Amount Per Common Share
BGR		$	0.0776
CII			0.0828
BDJ			0.0467
BOE			0.0630
BGY			0.0338
BME			0.2000
BCX			0.0516
BST			0.1500
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 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 BME’s prospectus for a more complete description of its risks.

 

 

SUPPLEMENTAL INFORMATION			3

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Table of Contents

 

		Page
The Markets in Review			2
Section 19(a) Notices			3
Section 19(b) Disclosure			3
Annual Report:
The Benefits and Risks of Option Over-Writing			5
Trust Information			6
Derivative Financial Instruments			24
Financial Statements:
Schedules of Investments			25
Statements of Assets and Liabilities			96
Statements of Operations			98
Statements of Changes in Net Assets			100
Statements of Cash Flows			105
Financial Highlights			107
Notes to Financial Statements			116
Report of Independent Registered Public Accounting Firm			128
Important Tax Information			129
Automatic Dividend Reinvestment Plans			130
Trustee and Officer Information			131
Additional Information			134
Glossary of Terms Used in this Report			137

 

 

4

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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 U.S. federal 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.

 

 

THE BENEFITS AND RISKS OF OPTION OVER-WRITING			5

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Trust Information  as of December 31, 2018		BlackRock Energy and Resources Trust

 

Investment Objective

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 New York Stock Exchange (“NYSE”)		BGR
Initial Offering Date		December 29, 2004
Current Distribution Rate on Closing Market Price as of December 31, 2018 ($10.45)(a)		8.91%
Current Monthly Distribution per Common Share(b)		$0.0776
Current Annualized Distribution per Common Share(b)		$0.9312

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BGR(a)(b)			(21.16	)%			(18.84	)%
Lipper Natural Resources Funds(c)			(24.64	)			(19.04	)

 

(a)

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

(b)

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

(c)

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

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

Past performance is not indicative of future results.

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

What factors influenced performance?

Energy stocks fell sharply in 2018. After moving sideways in a range through the first nine months of the year, the combination of a downturn in oil prices and a broad-based decline in global equities caused the sector to post a sizable loss in the fourth quarter.

Although many U.S.-based exploration and production (“E&P”) companies demonstrated improving fundamentals in 2018, the industry was hit particularly hard in the fourth quarter selloff. Encana Corp, which was penalized for its acquisition of Newfield Exploration, was the Trust’s largest detractor in the E&P industry. Devon Energy Corp., Cimarex Energy Co., Canadian Natural Resources Ltd. and EQT Corp. were also notable detractors in the period.

Companies demonstrating capital discipline, including ConocoPhillips, generally performed well despite the broadly challenging environment. The stock, which posted a gain even as the sector as a whole lost ground, was one of the leading contributors to the Trust’s performance. A position in the U.S. refining company Andeavor was another top contributor. Early in the period, Marathon Petroleum Corp. launched a bid for Andeavor at a substantial premium to its price at the time, causing the stock to rally.

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 option overlay strategy contributed to performance.

Describe recent portfolio activity

Consistent with the investment adviser’s long-term approach, there was a relatively low amount of portfolio turnover in 2018. However, the investment adviser was active in selling stocks that reached its price targets and rotating into those that offered more attractive valuations. Late in the year, the investment adviser sought to take advantage of the selloff in the refining stocks by increasing its allocation to this area. The Trust also continued to increase its allocation to non-U.S. energy stocks. While the Trust remains overweight to the E&P sub-sector, it reduced the position and increased its weighting in the integrated oil & gas industry to capitalize on its attractive valuations.

Describe portfolio positioning at period end.

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

 

 

6		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Energy and Resources Trust

 

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	10.45			$	14.18				(26.30	)%		$	15.76			$	9.89
Net Asset Value			11.98				15.79				(24.13	)			16.54				11.35

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

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			7

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Trust Information  as of December 31, 2018		BlackRock Enhanced Capital and Income Fund, Inc.

 

Investment Objective

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 securities of U.S. and foreign issuers. The Trust may invest directly in such securities or synthetically through the use of derivatives. The Trust also seeks to achieve its investment policy by employing a strategy of writing (selling) call and put options.

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

Trust Information

 

Symbol on NYSE		CII
Initial Offering Date		April 30, 2004
Current Distribution Rate on Closing Market Price as of December 31, 2018 ($14.08)(a)		7.06%
Current Monthly Distribution per Common Share(b)		$0.0828
Current Annualized Distribution per Common Share(b)		$0.9936

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

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

Performance and Portfolio Management Commentary

Returns for the 12 months period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
CII(a)(b)			(8.56	)%			(5.44	)%
S&P 500® Index			N/A				(4.38	)

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

What factors influenced performance?

In the equity allocation of the Trust, the largest detractor from relative performance for the 12-month period was stock selection in the consumer discretionary sector. Most notably, positioning across homebuilders and underweight exposure to internet and direct marketing retail challenged relative performance. This was followed by positioning in materials, where packaging and chemical holdings produced weakness. Finally, exposure to the electric utility industry hurt relative results in the utilities sector.

In the equity allocation of the Trust, the largest contributor to performance for the 12-month period was stock selection in the information technology (“IT”) sector. Specifically, selection decisions in software names provided strong relative returns. In industrials, positioning in machinery and rail roads enhanced relative performance. Finally, stock selection within energy provided outperformance, most notably avoiding energy equipment and services names.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. Premiums generated are recognized as current gains which are intended to enhance distributions payable to shareholders in the form of dividends. The use of options contributed to relative performance during the period.

Describe recent portfolio activity.

During the 12-month period, the Trust significantly boosted exposure to the health care sector. Holdings within consumer staples and energy also were increased. Conversely, the Trust significantly reduced exposure to the financials sector. The Trust also reduced exposure to consumer discretionary and materials stocks.

Describe portfolio positioning at period end.

The Trust’s largest allocations were in the IT, health care and financials sectors. Relative to the benchmark, the Trust’s largest overweight positions were in the health care, materials, energy and financials sectors. Conversely, the Trust’s largest relative underweights were in the real estate, industrials, and consumer staples 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		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Enhanced Capital and Income Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	14.08			$	16.38				(14.04	)%		$	17.36			$	13.13
Net Asset Value			15.28				17.19				(11.11	)			18.07				14.40

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

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			9

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Trust Information  as of December 31, 2018		BlackRock Enhanced Equity Dividend Trust

 

Investment Objective

BlackRock Enhanced Equity Dividend Trust’s (BDJ) (the “Trust”) primary investment objective is to provide current income and current gains, with a secondary investment objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing in common stocks that pay dividends and have the potential for capital appreciation and by 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.

Trust Information

 

Symbol on NYSE		BDJ
Initial Offering Date		August 31, 2005
Current Distribution Rate on Closing Market Price as of December 31, 2018 ($7.77)(a)		7.21%
Current Monthly Distribution per Common Share(b)		$0.0467
Current Annualized Distribution per Common Share(b)		$0.5604

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BDJ(a)(b)			(10.39	)%			(6.59	)%
Russell 1000® Value Index			N/A				(8.27	)

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

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 for the 12-month period came from an overweight position and stock selection within the health care sector. Notably, stock selection within and an overweight to the pharmaceuticals industry proved beneficial, as did an overweight to the health care providers & services industry. Within information technology (“IT”), a combination of stock selection and an overweight to the software industry boosted relative return, as did stock selection in the electronic equipment industry. Other notable contributors included stock selection within communication services and consumer staples.

The largest detractor from relative performance derived from a combination of stock selection and allocation decisions within financials. In particular, stock selection in the insurance and capital markets industries detracted, as did an overweight to banks and an underweight to the diversified financial services industry. Within utilities, stock selection in the electric utilities segment was particularly weak due to the impact on portfolio holdings from severe California wildfires. The portfolio’s lack of exposure to real estate also hindered relative return as the sector outperformed the broader U.S. equity market. Lastly, an overweight to construction materials as well as stock selection in the containers & packaging industry constrained results within the materials sector.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. Premiums generated are recognized as current gains that are intended to enhance distributions payable to shareholders in the form of dividends. The use of options had a positive effect on performance.

Describe recent portfolio activity.

During the 12-month period, a combination of portfolio trading activity and market price changes resulted in increased exposure to the communication services, health care and IT sectors. Conversely, exposures to financials, industrials and utilities were reduced.

Describe portfolio positioning at period end.

The Trust’s largest allocations were in the financials, health care and IT sectors. Relative to the benchmark, the Trust’s largest overweight positions were in the health care, IT and financials sectors. Conversely, the Trust’s largest relative underweights were in the real estate, consumer discretionary and utilities 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.

 

 

10		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Enhanced Equity Dividend Trust

 

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	7.77			$	9.23				(15.82	)%		$	9.64			$	7.24
Net Asset Value			8.74				9.96				(12.25	)			10.42				8.30

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

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			11

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Trust Information  as of December 31, 2018		BlackRock Enhanced Global Dividend Trust

 

Investment Objective

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

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

Trust Information

 

Symbol on NYSE		BOE
Initial Offering Date		May 31, 2005
Current Distribution Rate on Closing Market Price as of December 31, 2018 ($9.37)(a)		8.07%
Current Monthly Distribution per Common Share(b)		$0.0630
Current Annualized Distribution per Common Share(b)		$0.7560

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BOE(a)(b)			(19.16	)%			(9.63	)%
MSCI All Country World Index			N/A				(9.41	)

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

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

What factors influenced performance?

Positioning with respect to consumer staples was the largest detractor from performance, as both security selection within and an overweight to the sector weighed on returns. Stock selection in industrials, mainly within the air freight and logistics industry, also detracted, as did a lack of exposure to the utilities sector. In terms of individual stocks, a position in British American Tobacco PLC was the most significant detractor from returns. Tobacco stocks have suffered from negative sentiment driven by the FDA’s announcement that it would be looking to limit nicotine levels in traditional cigarettes along with questions about “Next Generation” smoking products. Positions in the postal and international courier companies Deutsche Post AG (Germany) and Bpost SA (Belgium) detracted due to higher costs for European postal companies. The investment adviser remains positive with respect to the longer-term prospects for both companies based on double-digit parcel growth domestically, driven by e-commerce.

During the 12-month period, the Trust’s significant overweight to and stock selection within the health care sector contributed to returns, particularly among pharmaceutical stocks. Stock selection in the newly created communication services sector also contributed, mostly due to the portfolio’s positioning in wireless telecommunication services names. Additionally, stock selection in consumer discretionary added value. On an individual security basis, the Trust’s position in the technology conglomerate Cisco Systems, Inc. was the top contributor to performance as the company reported earnings that exceeded analysts’ expectations and announced a share buyback plan that was viewed favorably by investors. In addition, holdings in the consumer goods firm Procter & Gamble Co. contributed to relative performance as the company’s internally generated revenue growth gained positive momentum throughout the year. The Trust’s position in the beverage firm Coca-Cola Co. also was a top contributor for the period, based on strong financial results and signs of accelerating growth.

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 contributed to performance.

 

 

12		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Enhanced Global Dividend Trust

 

Describe recent portfolio activity.

The Trust’s allocation to tobacco stocks was reduced in May, with the proceeds reinvested in high quality, dividend-paying names where the investment adviser has high conviction. These areas included health care, consumer staples and industrials stocks.

Describe portfolio positioning at period end.

At period end, the Trust’s largest sector overweight positions were in the consumer staples and health care sectors, with an emphasis on the tobacco and pharmaceuticals industries, respectively. The largest underweights were to financials and energy. The Trust had no exposure to real estate, utilities or energy at the end of the period. From a regional perspective, a majority of portfolio assets was invested either within the United States or Europe, with significant exposure in the United Kingdom and Switzerland.

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.

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	9.37			$	12.51				(25.10	)%		$	13.08			$	9.10
Net Asset Value			11.07				13.22				(16.26	)			13.71				10.70

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

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			13

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Trust Information  as of December 31, 2018		BlackRock Enhanced International Dividend Trust

 

Investment Objective

BlackRock Enhanced International Dividend 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 circumstances, at least 80% of its net assets in dividend-paying equity securities issued by non-U.S. companies of any market capitalization, but intends to invest primarily in securities of large capitalization companies. The Trust may invest directly in such securities or synthetically through the use of derivatives.

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

Trust Information

 

Symbol on NYSE		BGY
Initial Offering Date		May 30, 2007
Current Distribution Rate on Closing Market Price as of as of December 31, 2018 ($4.98)(a)		8.14%
Current Monthly Distribution per Common Share(b)		$0.0338
Current Annualized Distribution per Common Share(b)		$0.4056

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BGY(a)(b)			(17.55	)%			(11.48	)%
MSCI All Country World Index ex-USA			N/A				(14.20	)

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

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

What factors influenced performance?

The largest contribution to the Trust’s relative performance during the 12-month period came from stock selection within information technology (“IT”), led by a position in the multinational IT company Microsoft Corp. Performance was also helped by stock selection within and an overweight to the health care sector. The largest contributor to performance by region was the Trust’s exposure to Canadian equities.

Conversely, security selection within consumer staples, in particular tobacco companies, detracted from performance. Stock selection in industrials and a lack of exposure to utility stocks also weighed on returns. The largest detractor by region came from exposure to U.K. securities.

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 option writing strategy contributed to performance.

Describe recent portfolio activity.

The Trust reduced exposure to the tobacco industry during the period, and added exposure to industrials.

Describe portfolio positioning at period end.

At period end, the Trust held large absolute positions within the consumer staples, industrials and health care industries. The Trust had no holdings within the real estate, utilities or 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.

 

 

14		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Enhanced International Dividend Trust

 

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	4.98			$	6.52				(23.62	)%		$	6.85			$	4.78
Net Asset Value			5.79				7.06				(17.99	)			7.32				5.65

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

 

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			15

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Trust Information  as of December 31, 2018		BlackRock Health Sciences Trust

 

Investment Objective

BlackRock Health Sciences Trust’s (BME) (the “Trust”) investment objective is to provide total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities of companies engaged in the health sciences and related industries and equity derivatives with exposure to the health sciences industry. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and 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 December 31, 2018 ($36.45)(a)		6.58%
Current Monthly Distribution per Common Share(b)		$0.2000
Current Annualized Distribution per Common Share(b)		$2.4000

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12 months period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BME(a)(b)			6.57	%			7.26	%
Russell 3000® Healthcare Index			N/A				5.63

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

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

What factors influenced performance?

Although the broader global equity markets lost ground in 2018, health care stocks registered a gain. The sector performed well late in the year, as its defensive qualities and solid earnings prospects helped it hold up well in a time of elevated volatility.

Stock selection across all four of the underlying sub-sectors was the primary contributor to the Trust’s strong relative performance in 2018. An underweight position in Johnson & Johnson was the largest individual contributor in both the pharmaceuticals industry and the portfolio as a whole. The stock came under pressure late in the year after a report suggested that Johnson & Johnson knew about asbestos in its baby powder for decades.

An overweight position in Boston Scientific Corp. was a key contributor in the medical devices & supplies sub-sector. The company raised guidance regarding its growth outlook for 2019 and 2020, reflecting rising demand for its products. The investment advisor increased its weighting in Boston Scientific during the course of the year due to its promising and diversified pipeline of new products.

The Trust’s overweight in the home health care and hospice services provider Amedisys, Inc. was a top contributor in the health care providers & services area. The stock appreciated after the company’s third quarter earnings came in well above expectations.

Within the pharmaceuticals sub-sector, an underweight in Merck & Co., Inc. was among the largest detractors from performance. The company’s progress in its immuno-oncology clinical program surpassed the competition, lifting its stock. In addition, the approval of Merck’s flagship lung cancer drug for a variety of new indications increased the addressable market for the treatment. The investment advisor reduced the extent of the underweight in response to the company’s improving pipeline and fundamentals.

An overweight in the biotechnology firm Alnylam Pharmaceuticals, Inc., which was adversely affected by competitive pressure from Pfizer, was a further detractor. The uncertainty regarding Alnylam’s market share prompted the investment advisor to reduce the position from an overweight to a neutral weighting by the close of the year. Other detractors of note included off-benchmark positions in Insmed, Inc. and Novo-Nordisk A/S.

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 option overlay strategy detracted from performance in 2018.

 

 

16		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Health Sciences Trust

 

Describe recent portfolio activity.

The Trust increased its allocation to the medical devices & supplies and pharmaceuticals sub-sectors over the course of the year. It reduced its weighting in biotechnology, while its weighting in health care providers and services was unchanged.

The Trust held an above-average position in cash at the end of December, reflecting the investment advisor’s decision to adopt a more defensive posture once market volatility increased in the fourth quarter. The Trust’s cash position had a marginally positive impact on results.

Describe portfolio positioning at period end.

The Trust continued to employ a bottom-up, fundamental investment process in an effort to construct a balanced, diversified portfolio of healthcare stocks. The portfolio continues to reflect two broad themes: innovation and value-based healthcare.

Innovation in medical technology remains a secular growth driver for the health care sector, as companies continue to develop new therapies or products that are either fulfilling an unmet medical need or that represent an improvement over current treatments. This encompasses not only the biotechnology industry, but also the pharmaceuticals and medical devices & supplies sub-sectors.

With respect to value-based health care, the Trust has an above-benchmark weighting in the health care providers & services sub-sector due to its sizable overweight in managed care stocks. The investment advisor continues to find a number of companies in this area that it believes are well positioned to reduce health care costs by leveraging their scale and analytical capabilities. Additionally, select holdings in the health care services industry feature business models that are benefiting from the shift to lower-cost options such as home health care.

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.

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	36.45			$	36.50				(0.14	)%		$	44.00			$	32.00
Net Asset Value			35.87				35.69				0.50				40.03				33.61

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

 

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			17

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Trust Information  as of December 31, 2018		BlackRock Resources & Commodities Strategy Trust

 

Investment Objective

BlackRock Resources & Commodities Strategy Trust’s (BCX) (the “Trust”) primary investment objective is to seek high current income and current gains, with a secondary objective of capital appreciation. The Trust will seek to achieve its investment objectives, under normal market conditions, by investing at least 80% of its total assets in equity securities issued by commodity or natural resources companies, derivatives with exposure to commodity or natural resources companies or investments in securities and derivatives linked to the underlying price movement of commodities or natural resources. While permitted, the Trust does not currently expect to invest in securities and derivatives linked to the underlying price movement of commodities or natural resources. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and utilizing an option overwriting 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 December 31, 2018 ($7.06)(a)		8.77%
Current Monthly Distribution per Common Share(b)		$0.0516
Current Annualized Distribution per Common Share(b)		$0.6192

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BCX(a)(b)			(22.47	)%			(14.90	)%
Lipper Natural Resources Funds(c)			(24.64	)			(19.04	)

 

(a)

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

(b)

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

(c)

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

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

Past performance is not indicative of future results.

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

What factors influenced performance?

Concerns about slowing global growth fueled significant weakness in both commodity prices and the broader world equity markets in late 2018, weighing heavily on natural resources stocks.

The Trust’s allocation to the energy sector was the largest detractor from performance. Although many energy companies demonstrated fundamental improvements, highlighted by better capital discipline and a focus on cash flows, the sector posted a weak 12-month return due to the extent of its fourth quarter selloff. The exploration and production industry was hit particularly hard, causing the Trust’s investments in stocks such as Encana Corp. and Devon Energy Corp. to finish among its most significant individual detractors.

The Trust’s positions in mining stocks also detracted from results. Although the sector experienced a strong rally in the first half of January, the gains proved short lived as escalating trade tensions between the United States and China began to weigh on both commodity prices and investor sentiment as the year progressed. China, which consumes approximately half of the world’s mined commodities, is by far the most important driver of demand for the mining sector. However, the investment adviser believes that underlying physical supply and demand conditions remain solid and that much of the weakness was driven by speculation. Against this backdrop, the Trust’s positions in copper producers had a negative impact on performance, with First Quantum Minerals Ltd. finishing as one of the largest detractors. Fresnillo PLC and Neo Lithium Corp. were also notable detractors in the broader mining industry.

On the positive side, the Trust’s allocation to gold stocks contributed to absolute performance. Gold bullion rallied amid the financial market volatility that occurred the latter part of 2018, as investors who are nervous about other assets often look to gold as a “safe haven.” The investment adviser believes this indicated the potential value of gold as a source of diversification. In this environment, the Trust’s position in Randgold Resources Ltd. was one of the top contributors to performance. The stock’s strong return reflected both rising gold prices and the announcement of a merger with Barrick Gold Corp.

Vale SA, which benefited from the strong pricing environment for higher-grade iron ore, was another notable contributor. Other contributors of note include Nevsun Resources, Ltd., Agrium, Inc., and Hormel Foods Corp.

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 option overlay strategy contributed to performance.

 

 

18		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Resources & Commodities Strategy Trust

 

Describe recent portfolio activity.

The Trust exited some its positions in the agricultural industry, including Wilmar International, Ltd., where the investment adviser saw less room for earnings upside compared to other holdings, and Brasil Foods SA, which was pressured by a criminal investigation into members of its management team.

The Trust also rotated some of its positions in the mining industry by selling stocks that reached its price targets and rotating into those that offered more attractive valuations. In addition, the Trust raised its allocation to the sector through additions to large mining companies such as BHP Billiton Ltd. and Glencore PLC.

In the energy sector, the Trust increased its allocation to the refining industry and non-U.S. energy stocks, while reducing its weighting in U.S. onshore producers.

Describe portfolio positioning at period end.

The mining industry represented the Trust’s largest allocation, followed by energy and agriculture, 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.

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	7.06			$	9.77				(27.74	)%		$	10.49			$	6.66
Net Asset Value			8.44				10.64				(20.68	)			11.05				8.10

Market Price and Net Asset Value History For Past Five Years

 

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			19

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Trust Information  as of December 31, 2018		BlackRock Science and Technology Trust

 

Investment Objective

BlackRock Science and Technology Trust’s (BST) (the “Trust”) investment objective is to provide income and total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities of 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 December 31, 2018 ($27.48)(a)		6.55%
Current Monthly Distribution per Common Share(b)		$0.1500
Current Annualized Distribution per Common Share(b)		$1.8000

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018 were as follows:

 

		Returns Based On
		Market Price				Net Asset Value
BST(a)(b)			9.18	%			0.24	%
MSCI World Information Technology Index			N/A				(2.60	)

 

(a)

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

(b)

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

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

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

Past performance is not indicative of future results.

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

What factors influenced performance?

The Trust’s overweight position in software companies represented the largest contributor to performance return during the period, driven by the strong performance of enterprise software firms. On a stock specific basis, the Trust’s non-benchmark position in the online retailer Amazon.com, Inc. was the largest contributor as the company’s strong e-commerce and cloud services sales surpassed first- and second-quarter earnings expectations. The second largest contributor to relative return was the mobile payment company Square, Inc., which was rewarded by investors for continuing to diversify its product set and revenue stream beyond payments. The third largest contributor over the period was a non-benchmark position in the enterprise software firm Zuora, Inc., which benefited from the tailwind of increased movement toward subscription models for automated commerce.

The largest detractor from performance at a sub-sector level was stock selection within semiconductors, followed by selection within hardware. In terms of individual securities, an underweight to the consumer and enterprise software firm Microsoft Corp. was the most significant detractor. The Trust holds a structural underweight in Microsoft on the view that there are better growth opportunities elsewhere. The next largest detractors were underweight positions in the semiconductor company Broadcom, Inc. and the networking hardware firm Cisco Systems, Inc., as investors flocked to more defensive stocks amid market volatility, particularly in the latter part of the year.

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 had a marginally positive effect on returns.

Describe recent portfolio activity.

During the 12-month period, the Trust’s exposures to software and internet companies were increased, on the view that these firms are positioned to benefit from innovation while featuring low sensitivity to late cycle macroeconomics. Exposure to cyclical Chinese technology firms was decreased early in the period amid an emerging market sell-off. However, the Trust added back exposure to high-conviction names in the segment later in 2018 based on attractive valuations. Lastly, exposure to 5G component companies was raised based on their attractive growth prospects as the latest generation of cellular mobile communications technology is increasingly adopted.

Describe portfolio positioning at period end.

The Trust’s investment process aims to provide a balance of legacy technology firms that can continually innovate and newer, disruptive entrants that displace those that fail to innovate, with approximately 40% of the portfolio consisting of “core” legacy companies and 60% making up the “opportunistic,” high-growth portion. At period end,

 

 

20		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Science and Technology Trust

 

the Trust held its largest allocations in internet and software companies, which are supported by the longer-term tailwinds of innovation and the transition to cloud computing. The Trust’s software exposure was characterized by companies that offer enterprise software solutions, cloud computing services, and software-as-a-service, which are less cyclical in nature. The Trust also held a substantial investment in the 5G supply chain as this emerging technology is on track to disrupt the internet and communications space.

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.

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	27.48			$	26.69				2.96	%		$	36.00			$	24.00
Net Asset Value			26.21				27.73				(5.48	)			33.18				24.25

Market Price and Net Asset Value History Since Inception

 

 

 

(a)	Commencement of operations.

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			21

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Trust Information  as of December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust

 

Investment Objective

BlackRock Utilities, Infrastructure & Power Opportunities Trust’s (BUI) (the “Trust”) investment objective is to provide total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing primarily in equity securities issued by companies that are engaged in the Utilities, Infrastructure and Power Opportunities 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, the “Infrastructure” business segment to include companies that own or operate infrastructure assets or that are involved in the development, construction, distribution or financing of infrastructure assets and the “Power Opportunities” business segment to include companies with a significant involvement in, supporting, or necessary to renewable energy technology and development, alternative fuels, energy efficiency, automotive and sustainable mobility and technologies that enable or support the growth and adoption of new power and energy sources. Under normal circumstances, the Trust invests a substantial amount of its total assets in foreign issuers, issuers that primarily trade in a market located outside the United States or issuers that do a substantial amount of business outside the United States. The Trust may invest directly in such securities or synthetically through the use of derivatives.

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

Trust Information

 

Symbol on NYSE		BUI
Initial Offering Date		November 25, 2011
Current Distribution Rate on Closing Market Price as of December 31, 2018 ($19.76)(a)		7.35%
Current Monthly Distribution per Common Share(b)		$0.1210
Current Annualized Distribution per Common Share(b)		$1.4520

 

(a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate consists of income, net realized gains and/or a return of capital. See the Financial Highlights for the actual sources and character of distributions. Past performance does not guarantee future results.

(b)

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

Performance and Portfolio Management Commentary

Returns for the 12-month period ended December 31, 2018:

 

		Returns Based On
		Market Price				Net Asset Value
BUI(a)(b)			(1.68	)%			(4.40	)%
Lipper Utility Funds(c)			(9.66	)			(8.10	)

 

(a)

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

(b)

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

(c)

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

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

Past performance is not indicative of future results.

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

What factors influenced performance?

The largest detractor from performance was the Trust’s position in the industrials sector, which was negatively affected by weak investor sentiment toward China. The Trust’s position in the transportation infrastructure industry detracted from performance, with positions in Italian tollway operator Atlantia SpA and Australia’s Transurban Group among the most notable within this sub sector.

The largest contributor to performance was the Trust’s exposure to utilities, which proved to be more defensive amid the volatile market environment. From an industry standpoint, stock selection in electric utilities was the most noteworthy contributor to performance. Within the electric utilities industry, the Trust’s performance benefited from positions in major U.S. players NextEra Energy, Inc., Exelon Corp., and FirstEnergy Corp.

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 option writing strategy had a positive impact on performance during the period.

Describe recent portfolio activity.

During the period, the Trust reduced exposure to airports as well as midstream energy companies, selling its positions in Shell Midstream Partners LP and Plains All American Pipeline LP. The Trust used the proceeds to invest in energy distribution companies such as The Williams Companies and TransCanada Corp., as well as companies that have exposure to the electric vehicle industry, such as Switzerland’s ABB Ltd.

 

 

22		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trust Information  as of December 31, 2018 (continued)		BlackRock Utilities, Infrastructure & Power Opportunities Trust

 

Describe portfolio positioning at period end.

At period end, the utilities sector accounted for approximately 64% of the Trust’s assets. The Trust had approximately 15% and 13% of its assets invested in the industrials and energy sectors, respectively, with the remainder invested in other infrastructure- and power-related 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.

Market Price and Net Asset Value Per Share Summary

 

		12/31/18				12/31/17				Change				High				Low
Market Price		$	19.76			$	21.62				(8.60	)%		$	21.73			$	17.40
Net Asset Value			18.77				21.12				(11.13	)			21.27				18.26

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

 

 

Overview of the Trust’s Total Investments *

 

 

 

TRUST INFORMATION			23

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Derivative Financial Instruments

 

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

 

 

24		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments December 31, 2018		BlackRock Energy and Resources Trust (BGR) (Percentages shown are based on Net Assets)

 

(e)	During the year ended December 31, 2018, 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 Held at 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			3,870,844				1,136,131				5,006,975			$	5,006,975			$	78,939			$	—			$	—

 

(a)

Includes net capital gain distributions, if applicable.

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Exxon Mobil Corp.			206				01/04/19			USD			77.00			USD			1,405			$	7,725
Exxon Mobil Corp.			206				01/11/19			USD			78.00			USD			1,405				1,030
																						$	8,755

 

 

SCHEDULES OF INVESTMENTS			25

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Schedule of Investments  (continued) December 31, 2018		BlackRock Energy and Resources Trust (BGR)

 

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Anadarko Petroleum Corp.			159				01/04/19			USD			55.00			USD			697			$	(954	)
ConocoPhillips			355				01/04/19			USD			68.00			USD			2,213				(1,065	)
Devon Energy Corp.			343				01/04/19			USD			28.50			USD			773				(1,372	)
EOG Resources, Inc.			111				01/04/19			USD			105.00			USD			968				(444	)
Exxon Mobil Corp.			206				01/04/19			USD			80.00			USD			1,405				(412	)
Marathon Petroleum Corp.			26				01/04/19			USD			67.00			USD			153				(104	)
Pioneer Natural Resources Co.			47				01/04/19			USD			152.50			USD			618				(2,350	)
Royal Dutch Shell PLC — ADR, Class A			764				01/04/19			USD			61.50			USD			4,452				(30,560	)
Schlumberger Ltd.			114				01/04/19			USD			42.50			USD			411				(114	)
Valero Energy Corp.			135				01/04/19			USD			84.00			USD			1,012				(540	)
Williams Cos., Inc.			61				01/04/19			USD			25.50			USD			135				(305	)
Williams Cos., Inc.			137				01/04/19			USD			27.25			USD			302				—
Chevron Corp.			138				01/11/19			USD			119.00			USD			1,501				(690	)
ConocoPhillips			37				01/11/19			USD			71.00			USD			231				(148	)
EOG Resources, Inc.			91				01/11/19			USD			112.00			USD			794				(546	)
Exxon Mobil Corp.			206				01/11/19			USD			80.00			USD			1,405				(618	)
Halliburton Co.			195				01/11/19			USD			32.00			USD			518				(585	)
Halliburton Co.			285				01/11/19			USD			33.53			USD			758				(1	)
Marathon Petroleum Corp.			97				01/11/19			USD			65.00			USD			572				(1,164	)
Marathon Petroleum Corp.			136				01/11/19			USD			65.50			USD			803				(1,156	)
Pioneer Natural Resources Co.			84				01/11/19			USD			143.00			USD			1,105				(5,670	)
Royal Dutch Shell PLC — ADR, Class A			359				01/11/19			USD			60.00			USD			2,092				(11,668	)
Schlumberger Ltd.			114				01/11/19			USD			42.50			USD			411				(342	)
Valero Energy Corp.			135				01/11/19			USD			84.01			USD			1,012				(1,560	)
Williams Cos., Inc.			45				01/11/19			USD			26.00			USD			99				(945	)
Williams Cos., Inc.			163				01/11/19			USD			25.01			USD			359				(23	)
Williams Cos., Inc.			61				01/11/19			USD			25.18			USD			135				(6	)
Anadarko Petroleum Corp.			248				01/18/19			USD			60.00			USD			1,087				(1,240	)
Anadarko Petroleum Corp.			32				01/18/19			USD			55.00			USD			140				(144	)
Baker Hughes a GE Co.			580				01/18/19			USD			26.00			USD			1,247				(14,500	)
Chevron Corp.			121				01/18/19			USD			120.00			USD			1,316				(1,815	)
Concho Resources, Inc.			151				01/18/19			USD			135.00			USD			1,552				(2,265	)
ConocoPhillips			108				01/18/19			USD			67.50			USD			673				(3,834	)
Devon Energy Corp.			267				01/18/19			USD			30.00			USD			602				(267	)
Encana Corp.			1,466				01/18/19			CAD			12.00			CAD			1,155				(4,295	)
EOG Resources, Inc.			89				01/18/19			USD			100.00			USD			776				(2,314	)
Halliburton Co.			195				01/18/19			USD			33.00			USD			518				(487	)
Halliburton Co.			287				01/18/19			USD			35.45			USD			763				(1	)
Marathon Petroleum Corp.			26				01/18/19			USD			67.50			USD			153				(325	)
Noble Energy, Inc.			564				01/18/19			USD			27.50			USD			1,058				(2,820	)
Patterson-UTI Energy, Inc.			399				01/18/19			USD			14.00			USD			413				(3,990	)
Pioneer Natural Resources Co.			95				01/18/19			USD			160.00			USD			1,249				(3,800	)
Royal Dutch Shell PLC — ADR, Class A			343				01/18/19			USD			62.50			USD			1,999				(4,287	)
Schlumberger Ltd.			150				01/18/19			USD			50.00			USD			541				(450	)
Suncor Energy, Inc.			230				01/18/19			CAD			48.00			CAD			877				(842	)
Suncor Energy, Inc.			7,500				01/18/19			CAD			46.00			CAD			286				(302	)
TransCanada Corp.			535				01/18/19			CAD			54.00			CAD			2,608				(2,939	)
Valero Energy Corp.			87				01/18/19			USD			90.00			USD			652				(391	)
Valero Energy Corp.			208				01/18/19			USD			87.50			USD			1,559				(1,352	)
Williams Cos., Inc.			244				01/18/19			USD			26.00			USD			538				(854	)
Williams Cos., Inc.			163				01/18/19			USD			25.00			USD			359				(815	)
Anadarko Petroleum Corp.			80				01/25/19			USD			50.50			USD			351				(2,480	)
Baker Hughes a GE Co.			53				01/25/19			USD			23.12			USD			114				(1,233	)
Chevron Corp.			70				01/25/19			USD			119.00			USD			762				(3,325	)
ConocoPhillips			154				01/25/19			USD			68.00			USD			960				(5,929	)
Devon Energy Corp.			243				01/25/19			USD			27.50			USD			548				(1,822	)
EOG Resources, Inc.			82				01/25/19			USD			108.00			USD			715				(2,132	)
Exxon Mobil Corp.			522				01/25/19			USD			79.00			USD			3,560				(2,871	)
Halliburton Co.			158				01/25/19			USD			30.50			USD			420				(3,002	)
Marathon Petroleum Corp.			273				01/25/19			USD			65.50			USD			1,611				(10,511	)
Royal Dutch Shell PLC — ADR, Class A			360				01/25/19			USD			60.50			USD			2,098				(20,700	)
Schlumberger Ltd.			136				01/25/19			USD			45.00			USD			491				(612	)

 

 

26		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Energy and Resources Trust (BGR)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Valero Energy Corp.			107				01/25/19			USD			78.00			USD			802			$	(18,404	)
Williams Cos., Inc.			363				01/25/19			USD			25.00			USD			800				(2,359	)
Williams Cos., Inc.			46				01/25/19			USD			26.02			USD			101				(350	)
Anadarko Petroleum Corp.			32				02/01/19			USD			51.00			USD			140				(1,232	)
Baker Hughes a GE Co.			53				02/01/19			USD			23.12			USD			114				(1,422	)
ConocoPhillips			162				02/01/19			USD			65.00			USD			1,010				(23,085	)
Devon Energy Corp.			243				02/01/19			USD			27.50			USD			548				(3,159	)
EOG Resources, Inc.			112				02/01/19			USD			99.00			USD			977				(6,664	)
Exxon Mobil Corp.			380				02/01/19			USD			71.00			USD			2,591				(49,020	)
Exxon Mobil Corp.			205				02/01/19			USD			70.00			USD			1,398				(34,235	)
Marathon Petroleum Corp.			187				02/01/19			USD			60.50			USD			1,103				(39,364	)
Pioneer Natural Resources Co.			51				02/01/19			USD			138.00			USD			671				(20,400	)
Royal Dutch Shell PLC — ADR, Class A			359				02/01/19			USD			58.50			USD			2,092				(60,133	)
Royal Dutch Shell PLC — ADR, Class A			360				02/06/19			USD			58.51			USD			2,098				(55,452	)
Exxon Mobil Corp.			205				02/08/19			USD			70.01			USD			1,398				(24,206	)
Anadarko Petroleum Corp.			67				02/15/19			USD			55.00			USD			294				(1,742	)
Canadian Natural Resources Ltd.			792				02/15/19			CAD			34.00			CAD			2,609				(78,608	)
Chevron Corp.			138				02/15/19			USD			111.00			USD			1,501				(40,433	)
Concho Resources, Inc.			36				02/15/19			USD			105.00			USD			370				(19,800	)
Concho Resources, Inc.			154				02/15/19			USD			112.00			USD			1,583				(47,341	)
ConocoPhillips			101				02/15/19			USD			67.50			USD			630				(12,423	)
ConocoPhillips			51				02/15/19			USD			65.00			USD			318				(10,634	)
Exxon Mobil Corp.			379				02/15/19			USD			80.00			USD			2,584				(4,358	)
Exxon Mobil Corp.			207				02/15/19			USD			70.00			USD			1,412				(39,434	)
Noble Energy, Inc.			390				02/15/19			USD			21.75			USD			732				(12,929	)
Patterson-UTI Energy, Inc.			344				02/15/19			USD			15.00			USD			356				(3,440	)
Williams Cos., Inc.			320				02/15/19			USD			26.00			USD			706				(7,840	)
Williams Cos., Inc.			363				02/15/19			USD			25.00			USD			800				(8,530	)
																						$	(799,285	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Galp Energia SGPS SA		Goldman Sachs International			36,800				01/03/19			EUR			14.70			EUR			506			$	(8	)
Suncor Energy, Inc.		Goldman Sachs International			11,600				01/03/19			CAD			46.20			CAD			442				—
BP PLC		Barclays Bank PLC			311,000				01/04/19			GBP			5.52			GBP			1,543				—
BP PLC		UBS AG			255,500				01/04/19			GBP			5.38			GBP			1,267				(26	)
Suncor Energy, Inc.		Goldman Sachs International			27,600				01/04/19			CAD			44.18			CAD			1,052				—
Suncor Energy, Inc.		Credit Suisse International			11,200				01/07/19			CAD			46.00			CAD			427				(8	)
CNOOC Ltd.		UBS AG			407,000				01/08/19			HKD			14.23			HKD			4,908				(233	)
BP PLC		Morgan Stanley & Co. International PLC			270,000				01/09/19			GBP			5.28			GBP			1,339				(4,129	)
TOTAL SA		Morgan Stanley & Co. International PLC			40,000				01/09/19			EUR			53.35			EUR			1,842				(12	)
Oil Search Ltd.		UBS AG			190,000				01/10/19			AUD			7.56			AUD			1,359				(3,822	)
Suncor Energy, Inc.		Credit Suisse International			11,300				01/11/19			CAD			45.48			CAD			431				(2	)
CNOOC Ltd.		UBS AG			407,000				01/15/19			HKD			14.23			HKD			4,908				(775	)
Suncor Energy, Inc.		Goldman Sachs International			27,700				01/15/19			CAD			44.39			CAD			1,056				(676	)
BP PLC		Morgan Stanley & Co. International PLC			270,000				01/16/19			GBP			5.33			GBP			1,339				(6,916	)
Galp Energia SGPS SA		Credit Suisse International			36,800				01/16/19			EUR			14.92			EUR			506				(1,125	)
TOTAL SA		Credit Suisse International			46,400				01/16/19			EUR			48.97			EUR			2,136				(6,368	)
Canadian Natural Resources Ltd.		Credit Suisse International			34,000				01/23/19			CAD			37.51			CAD			1,120				(4,310	)
Encana Corp.		Credit Suisse International			34,300				01/23/19			CAD			8.33			CAD			270				(6,793	)
Suncor Energy, Inc.		Credit Suisse International			25,400				01/23/19			CAD			42.56			CAD			969				(2,870	)
TOTAL SA		UBS AG			28,200				01/23/19			EUR			50.27			EUR			1,298				(2,315	)
Royal Dutch Shell PLC — ADR, Class A		Goldman Sachs International			40,700				01/24/19			GBP			24.16			GBP			940				(11,593	)
TOTAL SA		Credit Suisse International			27,900				01/29/19			EUR			48.58			EUR			1,285				(10,950	)
BP PLC — ADR		UBS AG			300,000				01/31/19			GBP			5.36			GBP			1,488				(15,459	)
TransCanada Corp.		Deutsche Bank AG			26,800				01/31/19			CAD			51.91			CAD			1,307				(4,379	)
Suncor Energy, Inc.		Goldman Sachs International			19,800				02/01/19			CAD			43.81			CAD			755				(2,131	)
CNOOC Ltd.		JPMorgan Chase Bank N.A.			50,000				02/04/19			HKD			12.88			HKD			603				(1,746	)

 

 

SCHEDULES OF INVESTMENTS			27

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Schedule of Investments  (continued) December 31, 2018		BlackRock Energy and Resources Trust (BGR)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
BP PLC — ADR		Credit Suisse International			237,200				02/06/19			GBP			5.13			GBP			1,177			$	(34,253	)
Canadian Natural Resources Ltd.		Credit Suisse International			34,000				02/06/19			CAD			37.51			CAD			1,120				(9,398	)
Galp Energia SGPS SA		Credit Suisse International			39,200				02/06/19			EUR			14.15			EUR			539				(12,520	)
Oil Search Ltd.		UBS AG			124,300				02/06/19			AUD			7.49			AUD			889				(13,311	)
Suncor Energy, Inc.		Goldman Sachs International			23,100				02/07/19			CAD			37.66			CAD			881				(32,427	)
Baker Hughes a GE Co.		Deutsche Bank AG			24,500				02/08/19			USD			22.01			USD			527				(16,318	)
TOTAL SA		UBS AG			35,600				02/12/19			EUR			48.21			EUR			1,639				(25,175	)
Royal Dutch Shell PLC — ADR, Class A		Goldman Sachs International			40,700				02/13/19			GBP			24.39			GBP			940				(15,705	)
Suncor Energy, Inc.		Goldman Sachs International			15,500				02/14/19			CAD			41.73			CAD			591				(6,835	)
																								$	(252,588	)

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

 

		Swap Premiums Paid				Swap Premiums Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	2,540,288			$	(34,234	)		$	(1,051,873	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	8,755			$	—			$	—			$	—			$	8,755
Liabilities — Derivative Financial Instruments
Options written
Options written at value		$	—			$	—			$	1,051,873			$	—			$	—			$	—			$	1,051,873

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

For the period ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	6,138			$	—			$	—			$	—			$	6,138
Options written			—				—				(5,634,691	)			—				—				—				(5,634,691	)
		$	—			$	—			$	(5,628,553	)		$	—			$	—			$	—			$	(5,628,553	)
(a) Options purchased are included in net realized gain (loss) from investments.
Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	6,598			$	—			$	—			$	—			$	6,598
Options written			—				—				6,855,978				—				—				—				6,855,978
		$	—			$	—			$	6,862,576			$	—			$	—			$	—			$	6,862,576

 

(a)

Options purchased are included in net change in unrealized appreciation (depreciation) on investments.

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	2,189
Average value of option contracts written		$	2,947,718

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

 

 

28		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Energy and Resources Trust (BGR)

 

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Options		$	8,755	(a)		$	1,051,873
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(8,755	)			(799,285	)
Total derivative assets and liabilities subject to an MNA		$	—			$	252,588

 

(a)

Includes options purchased at value which is included in Investments at value — unaffiliated in the Statements of Assets and Liabilities and reported in the Schedule of Investments.

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities (b)
Credit Suisse International		$	88,597			$	—			$	—			$	—			$	88,597
Deutsche Bank AG			20,697				—				—				—				20,697
Goldman Sachs International			69,375				—				(69,375	)			—				—
JPMorgan Chase Bank N.A.			1,746				—				—				—				1,746
Morgan Stanley & Co. International PLC			11,057				—				—				—				11,057
UBS AG			61,116				—				—				—				61,116
		$	252,588			$	—			$	(69,375	)		$	—			$	183,213

 

(a)

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

(b)

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

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Energy Equipment & Services		$	21,590,147			$	—			$	—			$	21,590,147
Oil, Gas & Consumable Fuels			251,745,933				80,532,008				—				332,277,941
Short-Term Securities			5,006,975				—				—				5,006,975
Options Purchased:
Equity contracts			8,755				—				—				8,755
		$	278,351,810			$	80,532,008			$	—			$	358,883,818
Derivative Financial Instruments(a)
Liabilities:
Equity contracts		$	(614,328	)		$	(437,545	)		$	—			$	(1,051,873	)

 

(a)

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

During the year ended December 31, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS			29

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Schedule of Investments December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII) (Percentages shown are based on Net Assets)

 

 

 

30		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII) (Percentages shown are based on Net Assets)

 

(e)	During the year ended December 31, 2018, investments in issuers considered to be affiliates of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate		Shares Investment Value Held at 12/31/17				Net Activity				Shares Investment Value Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			3,142,974				11,646,380				14,789,354			$	14,789,354			$	80,954			$	—			$	—
SL Liquidity Series, LLC, Money Market Series			—				—				—				—				13,698	(b)			(97	)			—
														$	14,789,354			$	94,652			$	(97	)		$	—

 

(a)

Includes net capital gain distributions, if applicable.

(b)

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

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Bank of America Corp.			181				01/04/19			USD			28.00			USD			446			$	272
Altria Group, Inc.			309				01/18/19			USD			62.50			USD			1,526				1,390
Bank of America Corp.			344				01/18/19			USD			29.00			USD			848				860
																						$	2,522

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
U. S. Bancorp			61				01/03/19			USD			55.50			USD			279			$	—
Altria Group, Inc.			430				01/04/19			USD			55.50			USD			2,214				(16,770	)
Bank of America Corp.			363				01/04/19			USD			29.00			USD			894				(363	)
Baxter International, Inc.			141				01/04/19			USD			68.50			USD			928				(3,102	)
Biogen, Inc.			46				01/04/19			USD			337.50			USD			1,384				(9,890	)
Carnival Corp.			410				01/04/19			USD			63.50			USD			2,021				(2,050	)
Chevron Corp.			177				01/04/19			USD			118.00			USD			1,926				(531	)

 

 

SCHEDULES OF INVESTMENTS			31

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Cognizant Technology Solutions Corp., Class A			162				01/04/19			USD			72.00			USD			1,028			$	(8,100	)
D.R. Horton, Inc.			371				01/04/19			USD			39.00			USD			1,286				(4,823	)
Delta Air Lines, Inc.			234				01/04/19			USD			58.00			USD			1,168				(11,700	)
Delta Air Lines, Inc.			234				01/04/19			USD			61.00			USD			1,168				(11,700	)
DowDuPont, Inc.			212				01/04/19			USD			58.50			USD			1,134				(1,060	)
Emerson Electric Co.			215				01/04/19			USD			67.00			USD			1,285				(12,900	)
Freeport-McMoRan, Inc.			71				01/04/19			USD			12.50			USD			73				(71	)
Gilead Sciences, Inc.			224				01/04/19			USD			69.50			USD			1,401				(448	)
Hartford Financial Services Group, Inc.			316				01/04/19			USD			45.00			USD			1,405				(8,374	)
Humana, Inc.			67				01/04/19			USD			342.50			USD			1,919				(1,005	)
JPMorgan Chase & Co.			118				01/04/19			USD			112.00			USD			1,152				(5,900	)
Marathon Oil Corp.			202				01/04/19			USD			17.50			USD			290				(3,636	)
O’Reilly Automotive, Inc.			34				01/04/19			USD			355.00			USD			1,171				(3,032	)
Pfizer, Inc.			377				01/04/19			USD			43.50			USD			1,646				(19,793	)
Pfizer, Inc.			94				01/04/19			USD			44.50			USD			410				(1,598	)
Pfizer, Inc.			94				01/04/19			USD			46.50			USD			410				(376	)
Pfizer, Inc.			220				01/04/19			USD			45.00			USD			960				(1,540	)
U. S. Bancorp			61				01/04/19			USD			55.50			USD			279				—
Urban Outfitters, Inc.			38				01/04/19			USD			40.00			USD			126				(1,900	)
Urban Outfitters, Inc.			224				01/04/19			USD			39.00			USD			744				(11,200	)
Alphabet, Inc., Class A			4				01/11/19			USD			1,100.00			USD			418				(1,840	)
Altria Group, Inc.			430				01/11/19			USD			55.01			USD			2,124				(141	)
Apple, Inc.			280				01/11/19			USD			180.96			USD			4,417				(956	)
BP PLC — ADR			360				01/11/19			USD			42.00			USD			1,365				(1,080	)
Bank of America Corp.			92				01/11/19			USD			29.00			USD			227				(276	)
Bank of America Corp.			377				01/11/19			USD			27.00			USD			929				(754	)
Bank of America Corp.			334				01/11/19			USD			26.50			USD			823				(1,336	)
Bank of America Corp.			98				01/11/19			USD			25.00			USD			241				(3,822	)
Bank of America Corp.			166				01/11/19			USD			28.23			USD			409				(52	)
Biogen, Inc.			13				01/11/19			USD			327.50			USD			391				(1,787	)
Carnival Corp.			221				01/11/19			USD			60.00			USD			1,090				(1,105	)
Chevron Corp.			125				01/11/19			USD			119.00			USD			1,360				(625	)
Comcast Corp., Class A			512				01/11/19			USD			38.00			USD			1,743				(2,560	)
D.R. Horton, Inc.			395				01/11/19			USD			39.00			USD			1,369				(4,345	)
DISH Network Corp., Class A			235				01/11/19			USD			34.00			USD			587				(2,350	)
Delta Air Lines, Inc.			169				01/11/19			USD			58.00			USD			843				(1,014	)
DowDuPont, Inc.			145				01/11/19			USD			58.50			USD			775				(870	)
DowDuPont, Inc.			163				01/11/19			USD			55.00			USD			872				(9,535	)
Emerson Electric Co.			162				01/11/19			USD			66.00			USD			968				(2,430	)
FirstEnergy Corp.			100				01/11/19			USD			39.23			USD			376				(975	)
Fortive Corp.			136				01/11/19			USD			74.00			USD			920				(17,000	)
Freeport-McMoRan, Inc.			516				01/11/19			USD			11.00			USD			532				(6,450	)
Freeport-McMoRan, Inc.			482				01/11/19			USD			11.93			USD			497				(520	)
Freeport-McMoRan, Inc.			71				01/11/19			USD			12.20			USD			73				(38	)
Gilead Sciences, Inc.			80				01/11/19			USD			72.00			USD			500				(480	)
Hartford Financial Services Group, Inc.			316				01/11/19			USD			45.00			USD			1,405				(18,012	)
Lowe’s Cos., Inc.			94				01/11/19			USD			96.00			USD			868				(6,157	)
Marathon Oil Corp.			202				01/11/19			USD			17.50			USD			290				(808	)
Microsoft Corp.			319				01/11/19			USD			112.00			USD			3,240				(3,828	)
Pfizer, Inc.			95				01/11/19			USD			46.50			USD			415				(855	)
Pfizer, Inc.			220				01/11/19			USD			45.00			USD			960				(5,280	)
U.S. Bancorp			179				01/11/19			USD			54.50			USD			818				(716	)
U.S. Bancorp			98				01/11/19			USD			54.00			USD			448				(392	)
Urban Outfitters, Inc.			224				01/11/19			USD			39.00			USD			744				(10,080	)
Walmart, Inc.			378				01/11/19			USD			99.00			USD			3,521				(5,481	)
AES Corp.			400				01/18/19			USD			16.00			USD			578				(2,000	)
AES Corp.			380				01/18/19			USD			15.40			USD			549				(2,564	)
Ally Financial, Inc.			642				01/18/19			USD			27.00			USD			1,455				(9,630	)
Ally Financial, Inc.			124				01/18/19			USD			24.00			USD			281				(3,720	)
Alphabet, Inc., Class A			4				01/18/19			USD			1,130.00			USD			418				(1,660	)
Alphabet, Inc., Class A			21				01/18/19			USD			1,100.00			USD			2,194				(20,790	)
Altria Group, Inc.			309				01/18/19			USD			67.50			USD			1,526				(927	)

 

 

32		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Altria Group, Inc.			465				01/18/19			USD			55.00			USD			2,297			$	(5,115	)
Amdocs Ltd.			235				01/18/19			USD			65.00			USD			1,377				(15,275	)
Assured Guaranty Ltd.			200				01/18/19			USD			42.00			USD			766				(900	)
Assured Guaranty Ltd.			387				01/18/19			USD			39.00			USD			1,481				(25,155	)
BP PLC — ADR			334				01/18/19			USD			42.00			USD			1,267				(1,002	)
BP PLC — ADR			221				01/18/19			USD			41.00			USD			838				(1,547	)
Bank of America Corp.			688				01/18/19			USD			30.00			USD			1,695				(688	)
Baxter International, Inc.			121				01/18/19			USD			65.40			USD			796				(20,961	)
Biogen, Inc.			30				01/18/19			USD			340.00			USD			903				(2,025	)
CDW Corp.			332				01/18/19			USD			90.00			USD			2,691				(5,810	)
CDW Corp.			108				01/18/19			USD			85.00			USD			875				(13,230	)
Carnival Corp.			120				01/18/19			USD			60.00			USD			592				(600	)
Centene Corp.			234				01/18/19			USD			135.00			USD			2,698				(1,170	)
Chevron Corp.			124				01/18/19			USD			120.00			USD			1,349				(1,860	)
Chevron Corp.			209				01/18/19			USD			125.00			USD			2,274				(731	)
Cisco Systems, Inc.			407				01/18/19			USD			46.00			USD			1,764				(9,361	)
Cognizant Technology Solutions Corp., Class A			20				01/18/19			USD			67.50			USD			127				(550	)
Cognizant Technology Solutions Corp., Class A			163				01/18/19			USD			71.00			USD			1,035				(917	)
Comcast Corp., Class A			273				01/18/19			USD			38.75			USD			930				(682	)
DISH Network Corp., Class A			277				01/18/19			USD			35.00			USD			692				(2,770	)
DISH Network Corp., Class A			182				01/18/19			USD			32.50			USD			454				(1,365	)
Delta Air Lines, Inc.			231				01/18/19			USD			57.50			USD			1,153				(2,541	)
Dollar General Corp.			129				01/18/19			USD			115.00			USD			1,394				(7,740	)
DowDuPont, Inc.			365				01/18/19			USD			60.00			USD			1,952				(3,285	)
DowDuPont, Inc.			163				01/18/19			USD			55.00			USD			872				(15,893	)
E*Trade Financial Corp.			412				01/18/19			USD			50.00			USD			1,808				(3,914	)
Emerson Electric Co.			215				01/18/19			USD			67.50			USD			1,285				(1,612	)
FirstEnergy Corp.			104				01/18/19			USD			40.00			USD			391				(1,040	)
Fortive Corp.			320				01/18/19			USD			80.00			USD			2,165				(56,000	)
Freeport-McMoRan, Inc.			71				01/18/19			USD			13.00			USD			73				(106	)
Freeport-McMoRan, Inc.			482				01/18/19			USD			12.00			USD			497				(2,410	)
Freeport-McMoRan, Inc.			516				01/18/19			USD			11.00			USD			532				(10,578	)
Gilead Sciences, Inc.			167				01/18/19			USD			75.00			USD			1,045				(334	)
Humana, Inc.			33				01/18/19			USD			320.00			USD			945				(3,300	)
J.M. Smucker Co.			62				01/18/19			USD			110.00			USD			580				(310	)
J.M. Smucker Co.			154				01/18/19			USD			105.00			USD			1,440				(2,310	)
JPMorgan Chase & Co.			270				01/18/19			USD			110.00			USD			2,636				(2,160	)
JPMorgan Chase & Co.			83				01/18/19			USD			100.00			USD			810				(13,114	)
KAR Auction Services, Inc.			260				01/18/19			USD			60.00			USD			1,241				(1,300	)
Laboratory Corp. of America Holdings			301				01/18/19			USD			150.00			USD			3,803				(10,535	)
Lennar Corp., Class A			157				01/18/19			USD			45.00			USD			615				(4,553	)
Lowe’s Cos., Inc.			131				01/18/19			USD			92.50			USD			1,210				(34,322	)
Marathon Oil Corp.			48				01/18/19			USD			18.00			USD			69				(120	)
Marathon Oil Corp.			320				01/18/19			USD			15.00			USD			459				(12,800	)
Microsoft Corp.			345				01/18/19			USD			110.00			USD			3,504				(16,215	)
Microsoft Corp.			33				01/18/19			USD			112.00			USD			335				(1,588	)
Norfolk Southern Corp.			160				01/18/19			USD			160.00			USD			2,393				(18,000	)
Novartis AG — ADR			130				01/18/19			USD			90.00			USD			1,116				(3,575	)
Novo Nordisk A/S — ADR			324				01/18/19			USD			45.00			USD			1,493				(56,700	)
O’Reilly Automotive, Inc.			67				01/18/19			USD			360.00			USD			2,307				(30,150	)
O’Reilly Automotive, Inc.			33				01/18/19			USD			370.00			USD			1,136				(7,095	)
Packaging Corp. of America			17				01/18/19			USD			105.00			USD			142				(510	)
Packaging Corp. of America			53				01/18/19			USD			100.00			USD			442				(1,590	)
Packaging Corp. of America			283				01/18/19			USD			95.00			USD			2,362				(8,490	)
Pfizer, Inc.			130				01/18/19			USD			44.00			USD			567				(10,725	)
Pfizer, Inc.			94				01/18/19			USD			45.00			USD			410				(3,901	)
Regions Financial Corp.			377				01/18/19			USD			14.00			USD			504				(12,064	)
Rio Tinto PLC — ADR			67				01/18/19			USD			52.50			USD			325				(1,340	)
SunTrust Banks, Inc.			615				01/18/19			USD			57.50			USD			3,102				(3,997	)
Suncor Energy, Inc.			74				01/18/19			USD			36.00			USD			207				(370	)
Suncor Energy, Inc.			101				01/18/19			USD			35.00			USD			282				(505	)
Suncor Energy, Inc.			119				01/18/19			USD			34.00			USD			333				(476	)

 

 

SCHEDULES OF INVESTMENTS			33

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Suncor Energy, Inc.			318				01/18/19			USD			30.00			USD			889			$	(6,042	)
Taiwan Semiconductor Manufacturing Co. Ltd.			265				01/18/19			USD			40.00			USD			978				(6,625	)
U.S. Bancorp			229				01/18/19			USD			55.00			USD			1,047				(229	)
UnitedHealth Group, Inc.			54				01/18/19			USD			270.00			USD			1,345				(5,697	)
Urban Outfitters, Inc.			194				01/18/19			USD			39.00			USD			644				(1,940	)
Walmart, Inc.			255				01/18/19			USD			100.00			USD			2,375				(5,992	)
Alphabet, Inc., Class A			8				01/25/19			USD			1,057.50			USD			836				(24,200	)
Altria Group, Inc.			464				01/25/19			USD			55.00			USD			2,292				(7,656	)
BP PLC — ADR			221				01/25/19			USD			41.00			USD			838				(2,762	)
Bank of America Corp.			378				01/25/19			USD			27.00			USD			931				(4,725	)
Baxter International, Inc.			110				01/25/19			USD			66.00			USD			724				(20,570	)
Biogen, Inc.			13				01/25/19			USD			330.00			USD			391				(2,340	)
Biogen, Inc.			52				01/25/19			USD			307.50			USD			1,565				(40,820	)
Carnival Corp.			250				01/25/19			USD			58.00			USD			1,233				(1,250	)
Chevron Corp.			86				01/25/19			USD			119.00			USD			936				(4,085	)
Cisco Systems, Inc.			137				01/25/19			USD			49.00			USD			594				(753	)
Cisco Systems, Inc.			187				01/25/19			USD			42.00			USD			810				(37,961	)
Cognizant Technology Solutions Corp., Class A			19				01/25/19			USD			68.50			USD			121				(570	)
Comcast Corp., Class A			113				01/25/19			USD			38.50			USD			385				(847	)
D.R. Horton, Inc.			383				01/25/19			USD			38.00			USD			1,327				(17,427	)
DISH Network Corp., Class A			424				01/25/19			USD			34.00			USD			1,059				(31,800	)
DISH Network Corp., Class A			182				01/25/19			USD			32.50			USD			454				(3,640	)
Delta Air Lines, Inc.			189				01/25/19			USD			57.00			USD			943				(3,402	)
DowDuPont, Inc.			289				01/25/19			USD			57.50			USD			1,546				(14,017	)
DowDuPont, Inc.			163				01/25/19			USD			55.00			USD			872				(19,886	)
E*Trade Financial Corp.			269				01/25/19			USD			45.50			USD			1,180				(29,994	)
Emerson Electric Co.			132				01/25/19			USD			60.00			USD			789				(24,090	)
FirstEnergy Corp.			412				01/25/19			USD			39.27			USD			1,547				(10,518	)
Freeport-McMoRan, Inc.			516				01/25/19			USD			11.50			USD			532				(10,062	)
Gilead Sciences, Inc.			49				01/25/19			USD			73.00			USD			306				(588	)
Gilead Sciences, Inc.			80				01/25/19			USD			69.00			USD			500				(2,880	)
Hartford Financial Services Group, Inc.			100				01/25/19			USD			43.50			USD			445				(18,550	)
Humana, Inc.			76				01/25/19			USD			312.50			USD			2,177				(10,260	)
JPMorgan Chase & Co.			63				01/25/19			USD			107.00			USD			615				(2,173	)
JPMorgan Chase & Co.			83				01/25/19			USD			101.00			USD			810				(12,741	)
Lowe’s Cos., Inc.			160				01/25/19			USD			93.00			USD			1,478				(42,240	)
Marathon Oil Corp.			626				01/25/19			USD			19.00			USD			898				(2,504	)
Microsoft Corp.			153				01/25/19			USD			113.00			USD			1,554				(7,114	)
Microsoft Corp.			145				01/25/19			USD			106.00			USD			1,473				(30,160	)
Norfolk Southern Corp.			160				01/25/19			USD			160.00			USD			2,393				(37,600	)
Pfizer, Inc.			51				01/25/19			USD			45.00			USD			223				(2,856	)
Pfizer, Inc.			50				01/25/19			USD			44.50			USD			218				(3,725	)
Pfizer, Inc.			171				01/25/19			USD			44.00			USD			746				(16,673	)
SunTrust Banks, Inc.			615				01/25/19			USD			55.21			USD			3,102				(11,722	)
Suncor Energy, Inc.			319				01/25/19			USD			30.00			USD			892				(8,932	)
U.S. Bancorp			169				01/25/19			USD			52.00			USD			772				(1,014	)
UnitedHealth Group, Inc.			50				01/25/19			USD			275.00			USD			1,246				(2,925	)
UnitedHealth Group, Inc.			129				01/25/19			USD			250.00			USD			3,214				(98,040	)
Urban Outfitters, Inc.			240				01/25/19			USD			36.00			USD			797				(14,400	)
Walmart, Inc.			315				01/25/19			USD			92.00			USD			2,934				(97,650	)
J.M. Smucker Co.			61				01/28/19			USD			105.00			USD			570				(1,196	)
Novo Nordisk A/S — ADR			419				01/28/19			USD			45.90			USD			1,930				(61,577	)
Pfizer, Inc.			146				01/28/19			USD			45.10			USD			637				(8,983	)
Cisco Systems, Inc.			106				01/31/19			USD			46.25			USD			459				(5,824	)
J.M. Smucker Co.			231				01/31/19			USD			103.92			USD			2,160				(7,730	)
O’Reilly Automotive, Inc.			67				01/31/19			USD			352.00			USD			2,307				(57,841	)
Alphabet, Inc., Class A			20				02/01/19			USD			1,050.00			USD			2,090				(88,700	)
Apple, Inc.			120				02/01/19			USD			165.00			USD			1,893				(54,900	)
BP PLC — ADR Each Representing Six PLC			221				02/01/19			USD			41.01			USD			838				(5,614	)
Bank of America Corp.			835				02/01/19			USD			27.00			USD			2,057				(14,613	)
Carnival Corp.			221				02/01/19			USD			51.50			USD			1,090				(16,575	)
Cisco Systems, Inc.			187				02/01/19			USD			42.50			USD			810				(36,185	)

 

 

34		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Cisco Systems, Inc.			158				02/01/19			USD			48.28			USD			685			$	(4,028	)
Comcast Corp., Class A			324				02/01/19			USD			37.50			USD			1,103				(7,452	)
DISH Network Corp., Class A			153				02/01/19			USD			33.50			USD			382				(11,475	)
DISH Network Corp., Class A			182				02/01/19			USD			32.50			USD			454				(1,820	)
Delta Air Lines, Inc.			188				02/01/19			USD			55.00			USD			938				(9,682	)
Dollar General Corp.			93				02/01/19			USD			108.00			USD			1,005				(33,945	)
E*Trade Financial Corp.			388				02/01/19			USD			45.50			USD			1,703				(49,858	)
Emerson Electric Co.			162				02/01/19			USD			63.00			USD			968				(14,175	)
FirstEnergy Corp.			101				02/01/19			USD			39.93			USD			379				(2,161	)
Gilead Sciences, Inc.			50				02/01/19			USD			70.00			USD			313				(2,075	)
Gilead Sciences, Inc.			79				02/01/19			USD			70.50			USD			494				(2,607	)
JPMorgan Chase & Co.			83				02/01/19			USD			101.00			USD			810				(15,438	)
Lowe’s Cos., Inc.			217				02/01/19			USD			95.50			USD			2,004				(41,990	)
Marathon Oil Corp.			320				02/01/19			USD			16.00			USD			459				(9,120	)
Microsoft Corp.			145				02/01/19			USD			106.00			USD			1,473				(37,773	)
Pfizer, Inc.			57				02/01/19			USD			44.00			USD			249				(6,298	)
Suncor Energy, Inc.			318				02/01/19			USD			30.00			USD			889				(12,402	)
U.S. Bancorp			204				02/01/19			USD			47.50			USD			932				(15,096	)
UnitedHealth Group, Inc.			106				02/01/19			USD			262.50			USD			2,641				(39,750	)
UnitedHealth Group, Inc.			129				02/01/19			USD			250.00			USD			3,214				(111,263	)
BP PLC — ADR Each Representing Six PLC			360				02/08/19			USD			39.26			USD			1,365				(27,813	)
Bank of America Corp.			619				02/08/19			USD			25.00			USD			1,525				(55,091	)
Bank of America Corp.			102				02/08/19			USD			24.64			USD			251				(9,604	)
Cisco Systems, Inc.			187				02/08/19			USD			42.74			USD			810				(37,522	)
Comcast Corp., Class A			277				02/08/19			USD			35.32			USD			943				(22,486	)
Pfizer, Inc.			47				02/08/19			USD			42.66			USD			205				(8,225	)
Suncor Energy, Inc.			319				02/08/19			USD			30.01			USD			892				(14,772	)
US Bancorp			308				02/08/19			USD			47.00			USD			1,408				(32,648	)
FirstEnergy Corp.			412				02/11/19			USD			38.20			USD			1,547				(33,668	)
Taiwan Semiconductor Manufacturing Co. Ltd.			105				02/13/19			USD			37.97			USD			388				(11,881	)
AES Corp.			945				02/15/19			USD			16.00			USD			1,366				(9,450	)
BP PLC — ADR			360				02/15/19			USD			42.00			USD			1,365				(7,380	)
Bank of America Corp.			378				02/15/19			USD			27.00			USD			931				(10,962	)
Bank of America Corp.			364				02/15/19			USD			29.00			USD			897				(2,002	)
Baxter International, Inc.			142				02/15/19			USD			70.00			USD			935				(14,129	)
Chevron Corp.			106				02/15/19			USD			111.00			USD			1,153				(31,057	)
Cisco Systems, Inc.			107				02/15/19			USD			46.00			USD			464				(9,897	)
Cisco Systems, Inc.			187				02/15/19			USD			43.00			USD			810				(40,673	)
Cognizant Technology Solutions Corp., Class A			21				02/15/19			USD			65.00			USD			133				(4,462	)
Comcast Corp., Class A			158				02/15/19			USD			40.00			USD			538				(1,580	)
DISH Network Corp., Class A			130				02/15/19			USD			27.50			USD			325				(11,050	)
Dollar General Corp.			93				02/15/19			USD			110.00			USD			1,005				(33,015	)
Freeport-McMoRan, Inc.			516				02/15/19			USD			12.00			USD			532				(12,384	)
JPMorgan Chase & Co.			84				02/15/19			USD			105.00			USD			820				(9,534	)
Laboratory Corp. of America Holdings			279				02/15/19			USD			140.00			USD			3,525				(41,850	)
Lennar Corp., Class A			150				02/15/19			USD			45.00			USD			587				(10,575	)
Lowe’s Cos., Inc.			160				02/15/19			USD			95.00			USD			1,478				(43,520	)
Microsoft Corp.			143				02/15/19			USD			106.20			USD			1,452				(48,800	)
Regions Financial Corp.			377				02/15/19			USD			15.00			USD			504				(8,105	)
Regions Financial Corp.			624				02/15/19			USD			14.00			USD			835				(30,888	)
US Bancorp			308				02/15/19			USD			47.50			USD			1,408				(29,722	)
Walmart, Inc.			315				02/15/19			USD			92.50			USD			2,934				(114,189	)
Comcast Corp., Class A			277				02/21/19			USD			35.32			USD			943				(28,290	)
Lowe’s Cos., Inc.			218				03/15/19			USD			100.00			USD			2,013				(50,249	)
Novo Nordisk A/S — ADR			419				03/15/19			USD			46.00			USD			1,930				(93,228	)
																						$	(3,279,879	)

 

 

SCHEDULES OF INVESTMENTS			35

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call
Amdocs Ltd.		UBS AG			14,200				01/03/19				USD				66.55				USD				832			$	—
Novartis AG — ADR		Barclays Bank PLC			21,100				01/04/19				USD				90.40				USD				1,811				(62	)
CDW Corp.		Barclays Bank PLC			42,200				01/09/19				USD				97.16				USD				3,420				(51	)
AES Corp.		Credit Suisse International			45,300				01/10/19				USD				15.79				USD				655				(401	)
Assured Guaranty Ltd.		Barclays Bank PLC			18,200				01/11/19				USD				41.72				USD				697				(368	)
Ally Financial, Inc.		Citibank N.A.			38,400				01/23/19				USD				26.06				USD				870				(780	)
AES Corp.		Bank of America N.A.			66,200				01/25/19				USD				14.78				USD				957				(20,553	)
KAR Auction Services, Inc.		Morgan Stanley & Co. International PLC			25,800				01/25/19				USD				47.74				USD				1,231				(33,814	)
Assured Guaranty Ltd.		Barclays Bank PLC			38,800				01/28/19				USD				38.68				USD				1,485				(37,431	)
Ally Financial, Inc.		Citibank N.A.			73,200				01/29/19				USD				23.38				USD				1,659				(34,365	)
Rio Tinto PLC — ADR		Goldman Sachs International			8,700				01/29/19				USD				49.49				USD				422				(9,509	)
Regions Financial Corp.		Credit Suisse International			62,500				01/30/19				USD				13.72				USD				836				(21,328	)
SLM Corp.		JPMorgan Chase Bank N.A.			81,500				01/30/19				USD				8.96				USD				677				(5,753	)
AES Corp.		Goldman Sachs International			35,600				01/31/19				USD				15.25				USD				515				(5,136	)
SLM Corp.		Morgan Stanley & Co. International PLC			112,300				02/04/19				USD				10.54				USD				933				(85	)
Rio Tinto PLC — ADR		UBS AG			11,600				02/07/19				USD				47.17				USD				562				(33,156	)
Amdocs Ltd.		JPMorgan Chase Bank N.A.			14,200				02/11/19				USD				60.49				USD				832				(11,469	)
Centene Corp.		Credit Suisse International			23,400				02/12/19				USD				136.89				USD				2,698				(16,702	)
Rio Tinto PLC — ADR		Goldman Sachs International			8,700				02/13/19				USD				49.49				USD				422				(12,711	)
SLM Corp.		Credit Suisse International			134,600				02/13/19				USD				8.32				USD				1,119				(44,298	)
																												$	(287,972	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	4,923,979			$	(363,505	)		$	(3,567,851	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	2,522			$	—			$	—			$	—			$	2,522
Liabilities — Derivative Financial Instruments
Options written
Investments at value		$	—			$	—			$	3,567,851			$	—			$	—			$	—			$	3,567,851

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

For the year ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(19,044	)		$	—			$	—			$	—			$	(19,044	)
Options written			—				—				(368,218	)			—				—				—				(368,218	)
		$	—			$	—			$	(387,262	)		$	—			$	—			$	—			$	(387,262	)
(a) Options purchased are included in net realized gain (loss) from investments.

 

 

36		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Derivative Financial Instruments Categorized by Risk Exposure (continued)

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	(7,849	)		$	—			$	—			$	—			$	(7,849	)
Options written			—				—				6,586,567				—				—				—				6,586,567
		$	—			$	—			$	6,578,718			$	—			$	—			$	—			$	6,578,718

 

(a)

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

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	1,032
Average value of option contracts written		$	5,256,404

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Derivative Financial Instruments:
Options		$	2,522	(a)		$	3,567,851
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(2,522	)			(3,279,879	)
Total derivative assets and liabilities subject to an MNA		$	—			$	287,972

 

(a)	Includes options purchased at value which is included in Investments at value — unaffiliated in the Statements of Assets and Liabilities and reported in the Schedule of Investments.

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

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities (b)
Bank of America N.A.		$	20,553			$	—			$	—			$	—			$	20,553
Barclays Bank PLC			37,912				—				—				—				37,912
Citibank N.A.			35,145				—				(35,145	)			—				—
Credit Suisse International			82,729				—				—				—				82,729
Goldman Sachs International			27,356				—				—				—				27,356
JPMorgan Chase Bank N.A.			17,222				—				—				—				17,222
Morgan Stanley & Co. International PLC			33,899				—				—				—				33,899
UBS AG			33,156				—				—				—				33,156
		$	287,972			$	—			$	(35,145	)		$	—			$	252,827

 

(a)

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

(b)

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

 

 

SCHEDULES OF INVESTMENTS			37

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Capital and Income Fund (CII)

 

Fair Value Hierarchy as of Period End

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

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(a)		$	673,856,597			$	—			$	—			$	673,856,597
Short-Term Securities			14,789,354				—				—				14,789,354
Options Purchased:
Equity contracts			2,522				—				—				2,522
		$	688,648,473			$	—			$	—				688,648,473
Derivative Financial Instruments(b)
Liabilities
Equity contracts		$	(2,796,823	)		$	(771,028	)		$	—			$	(3,567,851	)

 

(a)

See above Schedule of Investments for values in each industry.

(b)

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

During the year ended December 31, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

38		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ) (Percentages shown are based on Net Assets)

 

 

 

SCHEDULES OF INVESTMENTS			39

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ) (Percentages shown are based on Net Assets)

 

(e)	During the year ended December 31, 2018, investments in issuers considered to be affiliates 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 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			4,967,189				39,558,869				44,526,058			$	44,526,058			$	262,280			$	—			$	—
SL Liquidity Series, LLC, Money Market Series			—				—				—				—				822	(b)			(51	)			—
														$	44,526,058			$	263,102				(51	)		$	—

 

(a)

Includes net capital gain distributions, if applicable.

(b)

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

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Bank of America Corp.			803				01/04/19			USD			28.00			USD			1,979			$	1,205
Wells Fargo & Co.			851				01/04/19			USD			50.00			USD			3,921				1,276
Wells Fargo & Co.			851				01/11/19			USD			51.50			USD			3,921				3,404
AXA Equitable Holdings, Inc.			828				01/18/19			USD			17.50			USD			1,377				12,420
Altria Group, Inc.			430				01/18/19			USD			62.50			USD			2,124				1,935
Bank of America Corp.			650				01/18/19			USD			29.00			USD			1,602				1,625
																						$	21,865

 

 

40		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
American International Group, Inc.			317				01/03/19			USD			46.00			USD			1,249			$	—
MetLife, Inc.			234				01/03/19			USD			47.00			USD			961				—
Public Service Enterprise Group, Inc.			675				01/03/19			USD			54.75			USD			3,513				(86	)
U.S. Bancorp			188				01/03/19			USD			55.50			USD			859				—
3M Co.			27				01/04/19			USD			202.50			USD			514				(216	)
Altria Group, Inc.			713				01/04/19			USD			55.50			USD			3,522				(27,807	)
American International Group, Inc.			254				01/04/19			USD			45.25			USD			1,001				(1	)
Anadarko Petroleum Corp.			313				01/04/19			USD			55.00			USD			1,372				(1,878	)
Anthem, Inc.			284				01/04/19			USD			290.00			USD			7,459				(2,840	)
Bank of America Corp.			738				01/04/19			USD			28.50			USD			1,818				(738	)
Bank of America Corp.			869				01/04/19			USD			29.00			USD			2,141				(869	)
Cardinal Health, Inc.			117				01/04/19			USD			55.50			USD			522				(2,925	)
Charles Schwab Corp.			251				01/04/19			USD			47.00			USD			1,042				(7,530	)
Citigroup, Inc.			338				01/04/19			USD			65.00			USD			1,760				(3,718	)
Cognizant Technology Solutions Corp., Class A			136				01/04/19			USD			72.00			USD			863				(6,800	)
Devon Energy Corp.			562				01/04/19			USD			28.50			USD			1,267				(2,248	)
DowDuPont, Inc.			290				01/04/19			USD			58.50			USD			1,551				(1,450	)
Goldman Sachs Group, Inc.			160				01/04/19			USD			205.00			USD			2,673				(1,600	)
Hess Corp.			572				01/04/19			USD			56.50			USD			2,317				(2,860	)
Humana, Inc.			110				01/04/19			USD			342.50			USD			3,151				(1,650	)
JPMorgan Chase & Co.			490				01/04/19			USD			112.00			USD			4,783				(24,500	)
Marathon Oil Corp.			303				01/04/19			USD			17.50			USD			435				(5,454	)
Marathon Petroleum Corp.			469				01/04/19			USD			67.00			USD			2,768				(1,876	)
McKesson Corp.			116				01/04/19			USD			130.00			USD			1,281				(1,160	)
McKesson Corp.			48				01/04/19			USD			131.50			USD			530				—
Medtronic PLC			262				01/04/19			USD			95.00			USD			2,383				(2,096	)
MetLife, Inc.			354				01/04/19			USD			46.25			USD			1,454				—
Morgan Stanley			631				01/04/19			USD			46.00			USD			2,502				(13,882	)
Oracle Corp.			872				01/04/19			USD			48.00			USD			3,937				(2,616	)
PepsiCo, Inc.			124				01/04/19			USD			116.00			USD			1,370				(744	)
Pfizer, Inc.			1,786				01/04/19			USD			43.50			USD			7,796				(93,765	)
Pfizer, Inc.			343				01/04/19			USD			44.50			USD			1,497				(5,831	)
Pfizer, Inc.			343				01/04/19			USD			46.50			USD			1,497				(1,372	)
Pfizer, Inc.			647				01/04/19			USD			45.00			USD			2,824				(4,529	)
Procter & Gamble Co.			220				01/04/19			USD			94.50			USD			2,022				(2,970	)
QUALCOMM, Inc.			746				01/04/19			USD			59.00			USD			4,245				(13,055	)
Travelers Cos., Inc.			132				01/04/19			USD			131.00			USD			1,581				—
U.S. Bancorp			188				01/04/19			USD			55.50			USD			859				—
Wells Fargo & Co.			410				01/04/19			USD			56.00			USD			1,889				(820	)
Wells Fargo & Co.			441				01/04/19			USD			54.00			USD			2,032				(7,497	)
Williams Cos., Inc.			50				01/04/19			USD			25.50			USD			110				(250	)
Williams Cos., Inc.			165				01/04/19			USD			27.25			USD			364				—
Unilever NV — NY Shares			652				01/08/19			USD			55.60			USD			3,508				(7,443	)
3M Co.			188				01/11/19			USD			210.00			USD			3,582				(2,068	)
Altria Group, Inc.			713				01/11/19			USD			55.01			USD			3,522				(234	)
American International Group, Inc.			493				01/11/19			USD			44.00			USD			1,943				(6,409	)
American International Group, Inc.			402				01/11/19			USD			39.00			USD			1,584				(47,838	)
Anthem, Inc.			270				01/11/19			USD			297.50			USD			7,091				(4,590	)
Bank of America Corp.			411				01/11/19			USD			29.00			USD			1,013				(1,233	)
Bank of America Corp.			642				01/11/19			USD			27.00			USD			1,582				(1,284	)
Bank of America Corp.			777				01/11/19			USD			26.50			USD			1,915				(3,108	)
Bank of America Corp.			198				01/11/19			USD			25.00			USD			488				(7,722	)
Bank of America Corp.			1,065				01/11/19			USD			28.23			USD			2,624				(331	)
CVS Health Corp.			87				01/11/19			USD			78.50			USD			570				(4,350	)
Citigroup, Inc.			458				01/11/19			USD			66.50			USD			2,384				(23,358	)
Cognizant Technology Solutions Corp., Class A			210				01/11/19			USD			71.00			USD			1,333				(1,050	)
Comcast Corp., Class A			711				01/11/19			USD			38.00			USD			2,421				(3,555	)
DowDuPont, Inc.			163				01/11/19			USD			58.50			USD			872				(978	)
DowDuPont, Inc.			177				01/11/19			USD			55.00			USD			947				(10,354	)
Enterprise Products Partners LP			632				01/11/19			USD			27.00			USD			1,554				(6,320	)
FirstEnergy Corp.			548				01/11/19			USD			39.23			USD			2,058				(5,345	)
General Electric Co.			509				01/11/19			USD			7.50			USD			385				(17,561	)
Lowe’s Cos., Inc.			104				01/11/19			USD			96.00			USD			961				(6,812	)
Marathon Oil Corp.			303				01/11/19			USD			17.50			USD			435				(1,212	)
Marathon Petroleum Corp.			67				01/11/19			USD			65.00			USD			395				(804	)

 

 

SCHEDULES OF INVESTMENTS			41

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Marathon Petroleum Corp.			136				01/11/19			USD			65.50			USD			803			$	(1,156	)
Medtronic PLC			186				01/11/19			USD			97.00			USD			1,692				(2,139	)
MetLife, Inc.			354				01/11/19			USD			45.75			USD			1,454				(757	)
Microsoft Corp.			291				01/11/19			USD			112.00			USD			2,956				(3,492	)
Morgan Stanley			152				01/11/19			USD			41.00			USD			603				(7,220	)
Morgan Stanley			631				01/11/19			USD			46.01			USD			2,502				(847	)
Northrop Grumman Corp.			169				01/11/19			USD			260.00			USD			4,139				(16,900	)
Oracle Corp.			902				01/11/19			USD			50.00			USD			4,073				(3,608	)
PepsiCo, Inc.			123				01/11/19			USD			119.00			USD			1,359				(676	)
PepsiCo, Inc.			114				01/11/19			USD			120.00			USD			1,259				(798	)
Pfizer, Inc.			344				01/11/19			USD			46.50			USD			1,502				(3,096	)
Pfizer, Inc.			647				01/11/19			USD			45.00			USD			2,824				(15,528	)
Procter & Gamble Co.			121				01/11/19			USD			93.00			USD			1,112				(12,705	)
QUALCOMM, Inc.			228				01/11/19			USD			60.00			USD			1,298				(8,436	)
State Street Corp.			271				01/11/19			USD			72.43			USD			1,709				(367	)
Travelers Cos., Inc.			277				01/11/19			USD			130.43			USD			3,317				(601	)
U.S. Bancorp			287				01/11/19			USD			54.50			USD			1,312				(1,148	)
U.S. Bancorp			204				01/11/19			USD			54.00			USD			932				(816	)
Union Pacific Corp.			102				01/11/19			USD			149.00			USD			1,410				(3,519	)
Verizon Communications, Inc.			967				01/11/19			USD			58.00			USD			5,436				(21,758	)
Wells Fargo & Co.			410				01/11/19			USD			56.00			USD			1,889				(1,230	)
Wells Fargo & Co.			441				01/11/19			USD			54.00			USD			2,032				(1,323	)
Williams Cos., Inc.			1,073				01/11/19			USD			26.00			USD			2,366				(22,533	)
Williams Cos., Inc.			633				01/11/19			USD			25.01			USD			1,396				(89	)
Williams Cos., Inc.			50				01/11/19			USD			25.18			USD			110				(5	)
AXA Equitable Holdings, Inc.			828				01/18/19			USD			22.50			USD			1,377				(28,980	)
Altria Group, Inc.			430				01/18/19			USD			67.50			USD			2,124				(1,290	)
Altria Group, Inc.			373				01/18/19			USD			55.00			USD			1,842				(4,103	)
American International Group, Inc.			443				01/18/19			USD			46.00			USD			1,746				(3,544	)
American International Group, Inc.			402				01/18/19			USD			39.00			USD			1,584				(58,893	)
Anadarko Petroleum Corp.			279				01/18/19			USD			60.00			USD			1,223				(1,395	)
Anthem, Inc.			63				01/18/19			USD			270.00			USD			1,655				(21,263	)
Anthem, Inc.			102				01/18/19			USD			290.00			USD			2,679				(3,876	)
Anthem, Inc.			213				01/18/19			USD			300.00			USD			5,594				(6,390	)
Arthur J Gallagher & Co.			346				01/18/19			USD			80.00			USD			2,550				(12,110	)
Bank of America Corp.			1,299				01/18/19			USD			30.00			USD			3,201				(1,299	)
CDW Corp.			298				01/18/19			USD			90.00			USD			2,415				(5,215	)
CDW Corp.			5				01/18/19			USD			85.00			USD			41				(612	)
CVS Health Corp.			238				01/18/19			USD			77.50			USD			1,559				(952	)
CVS Health Corp.			316				01/18/19			USD			210.00			USD			2,070				(316	)
Cardinal Health, Inc.			117				01/18/19			USD			55.00			USD			522				(585	)
Charles Schwab Corp.			341				01/18/19			USD			50.00			USD			1,416				(1,705	)
Cisco Systems, Inc.			125				01/18/19			USD			46.00			USD			542				(2,875	)
Citigroup, Inc.			458				01/18/19			USD			65.00			USD			2,384				(1,832	)
Citigroup, Inc.			339				01/18/19			USD			67.50			USD			1,765				(847	)
Cognizant Technology Solutions Corp., Class A			302				01/18/19			USD			67.50			USD			1,917				(8,305	)
Cognizant Technology Solutions Corp., Class A			136				01/18/19			USD			71.00			USD			863				(765	)
Comcast Corp., Class A			336				01/18/19			USD			38.75			USD			1,144				(840	)
Dollar General Corp.			177				01/18/19			USD			115.00			USD			1,913				(10,620	)
DowDuPont, Inc.			427				01/18/19			USD			60.00			USD			2,284				(3,843	)
DowDuPont, Inc.			177				01/18/19			USD			55.00			USD			947				(17,258	)
Edison International			73				01/18/19			USD			57.50			USD			414				(10,220	)
Enterprise Products Partners LP			500				01/18/19			USD			28.00			USD			1,230				(2,500	)
Enterprise Products Partners LP			1,264				01/18/19			USD			28.20			USD			3,108				(321	)
FirstEnergy Corp.			757				01/18/19			USD			39.00			USD			2,843				(18,925	)
FirstEnergy Corp.			311				01/18/19			USD			40.00			USD			1,168				(3,110	)
General Electric Co.			713				01/18/19			USD			9.00			USD			540				(2,495	)
General Electric Co.			399				01/18/19			USD			8.00			USD			302				(8,578	)
Goldman Sachs Group, Inc.			161				01/18/19			USD			205.00			USD			2,690				(1,207	)
Hess Corp.			380				01/18/19			USD			57.50			USD			1,539				(2,280	)
Honeywell International, Inc.			75				01/18/19			USD			150.00			USD			991				(750	)
Honeywell International, Inc.			113				01/18/19			USD			155.00			USD			1,493				(13,108	)
Humana, Inc.			27				01/18/19			USD			320.00			USD			773				(2,700	)
JPMorgan Chase & Co.			901				01/18/19			USD			110.00			USD			8,796				(7,208	)
JPMorgan Chase & Co.			345				01/18/19			USD			100.00			USD			3,368				(54,510	)

 

 

42		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Johnson Controls International PLC			335				01/18/19			USD			35.00			USD			993			$	(1,172	)
Johnson Controls International PLC			325				01/18/19			USD			33.00			USD			964				(2,925	)
Kellogg Co.			394				01/18/19			USD			65.00			USD			2,246				(3,940	)
Lockheed Martin Corp.			55				01/18/19			USD			270.00			USD			1,440				(22,275	)
Lowe’s Cos., Inc.			155				01/18/19			USD			92.50			USD			1,432				(40,610	)
Marathon Oil Corp.			134				01/18/19			USD			18.00			USD			192				(335	)
Marathon Oil Corp.			585				01/18/19			USD			15.00			USD			839				(23,400	)
Marathon Petroleum Corp.			469				01/18/19			USD			67.50			USD			2,768				(5,862	)
Marsh & McLennan Cos., Inc.			598				01/18/19			USD			85.00			USD			4,769				(11,960	)
Marsh & McLennan Cos., Inc.			596				01/18/19			USD			87.80			USD			4,753				(3,490	)
Masco Corp.			332				01/18/19			USD			31.00			USD			971				(6,640	)
Mattel, Inc.			625				01/18/19			USD			14.00			USD			624				(3,125	)
McKesson Corp.			48				01/18/19			USD			135.00			USD			530				(240	)
McKesson Corp.			116				01/18/19			USD			130.00			USD			1,281				(870	)
Medtronic PLC			361				01/18/19			USD			96.25			USD			3,284				(15,927	)
Merck & Co., Inc.			452				01/18/19			USD			77.50			USD			3,454				(42,036	)
MetLife, Inc.			1,043				01/18/19			USD			42.50			USD			4,283				(59,451	)
Microsoft Corp.			194				01/18/19			USD			110.00			USD			1,970				(9,118	)
Microsoft Corp.			378				01/18/19			USD			112.00			USD			3,839				(18,190	)
Mondelez International, Inc.			271				01/18/19			USD			45.00			USD			1,085				(813	)
Morgan Stanley			982				01/18/19			USD			48.00			USD			3,894				(4,910	)
Motorola Solutions, Inc.			352				01/18/19			USD			135.00			USD			4,049				(14,432	)
Newell Brands, Inc.			584				01/18/19			USD			23.00			USD			1,086				(4,380	)
Newell Brands, Inc.			508				01/18/19			USD			24.00			USD			944				(2,540	)
NextEra Energy, Inc.			482				01/18/19			USD			180.00			USD			8,378				(50,610	)
Novartis AG — ADR			204				01/18/19			USD			92.50			USD			1,751				(2,040	)
Novartis AG — ADR			145				01/18/19			USD			90.00			USD			1,244				(3,987	)
Novo Nordisk A/S — ADR			767				01/18/19			USD			45.00			USD			3,534				(134,225	)
ONEOK, Inc.			492				01/18/19			USD			62.50			USD			2,654				(9,840	)
PG&E Corp.			455				01/18/19			USD			29.00			USD			1,081				(9,100	)
Pentair PLC			361				01/18/19			USD			42.45			USD			1,364				(312	)
PepsiCo, Inc.			341				01/18/19			USD			120.00			USD			3,767				(3,921	)
Pfizer, Inc.			1,106				01/18/19			USD			44.00			USD			4,828				(91,245	)
Pfizer, Inc.			343				01/18/19			USD			45.00			USD			1,497				(14,234	)
Procter & Gamble Co.			226				01/18/19			USD			95.00			USD			2,077				(15,029	)
Public Service Enterprise Group, Inc.			420				01/18/19			USD			55.00			USD			2,186				(5,250	)
State Street Corp.			326				01/18/19			USD			72.50			USD			2,056				(4,238	)
Suncor Energy, Inc.			227				01/18/19			USD			36.00			USD			635				(1,135	)
Suncor Energy, Inc.			378				01/18/19			USD			35.00			USD			1,057				(1,890	)
Suncor Energy, Inc.			433				01/18/19			USD			34.00			USD			1,211				(1,732	)
Suncor Energy, Inc.			823				01/18/19			USD			30.00			USD			2,302				(15,637	)
TOTAL SA — ADR			530				01/18/19			USD			60.00			USD			2,766				(5,300	)
Taiwan Semiconductor Manufacturing Co. Ltd.			406				01/18/19			USD			40.00			USD			1,499				(10,150	)
Taiwan Semiconductor Manufacturing Co. Ltd.			159				01/18/19			USD			39.00			USD			587				(7,155	)
Travelers Cos., Inc.			274				01/18/19			USD			127.25			USD			3,281				(9,256	)
U.S. Bancorp			423				01/18/19			USD			55.00			USD			1,933				(423	)
Unilever NV — NY Shares			638				01/18/19			USD			55.00			USD			3,432				(33,495	)
Union Pacific Corp.			126				01/18/19			USD			151.50			USD			1,742				(4,899	)
UnitedHealth Group, Inc.			52				01/18/19			USD			270.00			USD			1,295				(5,486	)
Verizon Communications, Inc.			1,952				01/18/19			USD			57.50			USD			10,974				(98,576	)
Wells Fargo & Co.			277				01/18/19			USD			55.00			USD			1,276				(277	)
Wells Fargo & Co.			834				01/18/19			USD			52.50			USD			3,843				(4,587	)
Williams Cos., Inc.			118				01/18/19			USD			26.00			USD			260				(413	)
Williams Cos., Inc.			633				01/18/19			USD			25.00			USD			1,396				(3,165	)
BCE, Inc.			251				01/23/19			USD			42.69			USD			992				(539	)
Kellogg Co.			318				01/24/19			USD			62.80			USD			1,813				(5,099	)
Travelers Cos., Inc.			274				01/24/19			USD			122.55			USD			3,281				(45,573	)
3M Co.			26				01/25/19			USD			205.00			USD			495				(2,301	)
AXA Equitable Holdings, Inc.			515				01/25/19			USD			16.27			USD			856				(38,179	)
Altria Group, Inc.			374				01/25/19			USD			55.00			USD			1,847				(6,171	)
American International Group, Inc.			695				01/25/19			USD			41.00			USD			2,739				(50,735	)
Anadarko Petroleum Corp.			157				01/25/19			USD			50.50			USD			688				(4,867	)
Anthem, Inc.			51				01/25/19			USD			287.50			USD			1,339				(4,411	)
Anthem, Inc.			50				01/25/19			USD			282.50			USD			1,313				(7,650	)
Apple, Inc.			73				01/25/19			USD			165.00			USD			1,152				(21,718	)

 

 

SCHEDULES OF INVESTMENTS			43

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Arthur J Gallagher & Co.			347				01/25/19			USD			75.66			USD			2,557			$	(26,592	)
Baker Hughes a GE Co.			232				01/25/19			USD			23.12			USD			499				(5,398	)
Bank of America Corp.			641				01/25/19			USD			27.00			USD			1,579				(8,012	)
CVS Health Corp.			239				01/25/19			USD			77.50			USD			1,566				(3,585	)
Cardinal Health, Inc.			233				01/25/19			USD			46.50			USD			1,039				(19,805	)
Charles Schwab Corp.			200				01/25/19			USD			43.50			USD			831				(15,000	)
Cisco Systems, Inc.			111				01/25/19			USD			49.00			USD			481				(610	)
Cisco Systems, Inc.			132				01/25/19			USD			42.00			USD			572				(26,796	)
Citigroup, Inc.			312				01/25/19			USD			61.50			USD			1,624				(2,496	)
Cognizant Technology Solutions Corp., Class A			302				01/25/19			USD			68.50			USD			1,917				(9,060	)
Comcast Corp., Class A			197				01/25/19			USD			38.50			USD			671				(1,477	)
Devon Energy Corp.			640				01/25/19			USD			27.50			USD			1,443				(4,800	)
DowDuPont, Inc.			326				01/25/19			USD			57.50			USD			1,743				(15,811	)
DowDuPont, Inc.			178				01/25/19			USD			55.00			USD			952				(21,716	)
Enterprise Products Partners LP			1,474				01/25/19			USD			27.00			USD			3,625				(22,110	)
FirstEnergy Corp.			498				01/25/19			USD			39.27			USD			1,870				(12,713	)
General Electric Co.			1,191				01/25/19			USD			8.00			USD			902				(30,966	)
Goldman Sachs Group, Inc.			127				01/25/19			USD			177.50			USD			2,122				(33,909	)
Hess Corp.			380				01/25/19			USD			57.50			USD			1,539				(2,660	)
Honeywell International, Inc.			43				01/25/19			USD			143.00			USD			568				(1,247	)
Honeywell International, Inc.			268				01/25/19			USD			138.00			USD			3,541				(31,356	)
Humana, Inc.			136				01/25/19			USD			312.50			USD			3,896				(18,360	)
International Paper Co.			288				01/25/19			USD			44.50			USD			1,162				(6,192	)
JPMorgan Chase & Co.			233				01/25/19			USD			107.00			USD			2,275				(8,038	)
JPMorgan Chase & Co.			430				01/25/19			USD			105.00			USD			4,198				(22,360	)
JPMorgan Chase & Co.			345				01/25/19			USD			101.00			USD			3,368				(52,958	)
Johnson Controls International PLC			328				01/25/19			USD			33.00			USD			973				(2,628	)
Lockheed Martin Corp.			58				01/25/19			USD			305.00			USD			1,519				(1,740	)
Lowe’s Cos., Inc.			153				01/25/19			USD			93.00			USD			1,413				(40,392	)
Marathon Oil Corp.			149				01/25/19			USD			19.00			USD			214				(596	)
Marathon Petroleum Corp.			273				01/25/19			USD			65.50			USD			1,611				(10,510	)
Mattel, Inc.			287				01/25/19			USD			11.00			USD			287				(5,022	)
McKesson Corp.			47				01/25/19			USD			116.00			USD			519				(7,637	)
Medtronic PLC			263				01/25/19			USD			95.50			USD			2,392				(18,542	)
Merck & Co., Inc.			587				01/25/19			USD			79.50			USD			4,485				(30,818	)
MetLife, Inc.			1,043				01/25/19			USD			43.00			USD			4,283				(63,623	)
Microsoft Corp.			20				01/25/19			USD			113.00			USD			203				(930	)
Microsoft Corp.			433				01/25/19			USD			106.00			USD			4,398				(90,064	)
Mondelez International, Inc.			219				01/25/19			USD			44.50			USD			877				(1,642	)
Morgan Stanley			929				01/25/19			USD			43.00			USD			3,683				(45,521	)
Motorola Solutions, Inc.			321				01/25/19			USD			135.36			USD			3,693				(1,181	)
Northrop Grumman Corp.			99				01/25/19			USD			272.50			USD			2,425				(8,415	)
ONEOK, Inc.			720				01/25/19			USD			61.00			USD			3,884				(25,200	)
Oracle Corp.			872				01/25/19			USD			48.00			USD			3,937				(23,544	)
PG&E Corp.			569				01/25/19			USD			27.00			USD			1,351				(31,295	)
PepsiCo, Inc.			225				01/25/19			USD			113.00			USD			2,486				(36,675	)
Pfizer, Inc.			971				01/25/19			USD			45.00			USD			4,238				(54,376	)
Pfizer, Inc.			971				01/25/19			USD			44.50			USD			4,238				(72,340	)
Pfizer, Inc.			868				01/25/19			USD			44.00			USD			3,789				(84,630	)
Procter & Gamble Co.			121				01/25/19			USD			93.00			USD			1,112				(20,691	)
Suncor Energy, Inc.			824				01/25/19			USD			30.00			USD			2,305				(23,072	)
U.S. Bancorp			157				01/25/19			USD			52.00			USD			717				(942	)
UnitedHealth Group, Inc.			60				01/25/19			USD			275.00			USD			1,495				(3,510	)
UnitedHealth Group, Inc.			137				01/25/19			USD			250.00			USD			3,413				(104,120	)
Verizon Communications, Inc.			753				01/25/19			USD			58.00			USD			4,233				(41,415	)
Verizon Communications, Inc.			1,521				01/25/19			USD			57.00			USD			8,551				(134,609	)
Wells Fargo & Co.			333				01/25/19			USD			48.00			USD			1,534				(28,638	)
Williams Cos., Inc.			580				01/25/19			USD			25.00			USD			1,279				(3,770	)
Williams Cos., Inc.			1,073				01/25/19			USD			26.02			USD			2,366				(8,169	)
Johnson Controls International PLC			164				01/28/19			USD			34.00			USD			486				(1,697	)
Johnson Controls International PLC			491				01/28/19			USD			33.50			USD			1,456				(3,335	)
Novo Nordisk A/S — ADR			483				01/28/19			USD			45.90			USD			2,225				(70,982	)
Pfizer, Inc.			432				01/28/19			USD			45.10			USD			1,886				(26,581	)
Novartis AG — ADR			328				01/29/19			USD			84.73			USD			2,815				(84,828	)
Masco Corp.			332				01/30/19			USD			30.93			USD			971				(16,623	)

 

 

44		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Merck & Co., Inc.			545				01/30/19			USD			79.90			USD			4,164			$	(35,445	)
State Street Corp.			271				01/30/19			USD			64.24			USD			1,709				(55,296	)
Cisco Systems, Inc.			155				01/31/19			USD			46.25			USD			672				(8,517	)
Edison International			16				01/31/19			USD			60.25			USD			91				(3,563	)
FirstEnergy Corp.			303				01/31/19			USD			38.25			USD			1,138				(19,364	)
Newell Brands, Inc.			612				01/31/19			USD			21.25			USD			1,138				(18,981	)
NextEra Energy, Inc.			182				01/31/19			USD			178.00			USD			3,164				(40,937	)
Oracle Corp.			295				01/31/19			USD			48.00			USD			1,332				(13,501	)
3M Co.			100				02/01/19			USD			202.50			USD			1,905				(20,950	)
AXA Equitable Holdings, Inc.			449				02/01/19			USD			18.05			USD			747				(7,355	)
Apple, Inc.			73				02/01/19			USD			165.00			USD			1,152				(33,398	)
Arthur J Gallagher & Co.			347				02/01/19			USD			74.37			USD			2,557				(50,391	)
Baker Hughes a GE Co.			232				02/01/19			USD			23.12			USD			499				(6,224	)
Bank of America Corp.			1,692				02/01/19			USD			27.00			USD			4,169				(29,610	)
Charles Schwab Corp.			196				02/01/19			USD			41.50			USD			814				(34,300	)
Cisco Systems, Inc.			132				02/01/19			USD			42.50			USD			572				(25,542	)
Cisco Systems, Inc.			298				02/01/19			USD			48.28			USD			1,291				(7,596	)
Citigroup, Inc.			379				02/01/19			USD			58.50			USD			1,973				(14,970	)
Citigroup, Inc.			561				02/01/19			USD			53.50			USD			2,921				(91,163	)
Comcast Corp., Class A			506				02/01/19			USD			37.50			USD			1,723				(11,638	)
Devon Energy Corp.			163				02/01/19			USD			27.50			USD			367				(2,119	)
Dollar General Corp.			238				02/01/19			USD			108.00			USD			2,572				(86,870	)
FirstEnergy Corp.			548				02/01/19			USD			39.93			USD			2,058				(11,727	)
General Electric Co.			1,112				02/01/19			USD			8.00			USD			842				(47,260	)
Honeywell International, Inc.			268				02/01/19			USD			138.00			USD			3,541				(52,394	)
International Paper Co.			289				02/01/19			USD			44.50			USD			1,166				(9,970	)
JPMorgan Chase & Co.			345				02/01/19			USD			101.00			USD			3,368				(64,170	)
Kellogg Co.			394				02/01/19			USD			60.80			USD			2,246				(20,592	)
Lockheed Martin Corp.			55				02/01/19			USD			272.50			USD			1,440				(28,600	)
Lowe’s Cos., Inc.			144				02/01/19			USD			95.50			USD			1,330				(27,864	)
Marathon Oil Corp.			585				02/01/19			USD			16.00			USD			839				(16,673	)
Marathon Petroleum Corp.			124				02/01/19			USD			60.50			USD			732				(26,102	)
Mattel, Inc.			768				02/01/19			USD			10.00			USD			767				(51,840	)
McKesson Corp.			46				02/01/19			USD			125.00			USD			508				(3,335	)
Medtronic PLC			507				02/01/19			USD			93.00			USD			4,612				(86,951	)
MetLife, Inc.			1,183				02/01/19			USD			42.50			USD			4,857				(97,598	)
Microsoft Corp.			433				02/01/19			USD			106.00			USD			4,398				(112,797	)
Motorola Solutions, Inc.			321				02/01/19			USD			135.36			USD			3,693				(2,879	)
Oracle Corp.			590				02/01/19			USD			49.00			USD			2,664				(11,800	)
Oracle Corp.			295				02/01/19			USD			48.00			USD			1,332				(11,210	)
PG&E Corp.			455				02/01/19			USD			30.00			USD			1,081				(7,962	)
Pfizer, Inc.			290				02/01/19			USD			44.00			USD			1,266				(32,045	)
QUALCOMM, Inc.			164				02/01/19			USD			59.00			USD			933				(28,290	)
Suncor Energy, Inc.			824				02/01/19			USD			30.00			USD			2,305				(32,136	)
UnitedHealth Group, Inc.			96				02/01/19			USD			262.50			USD			2,392				(36,000	)
UnitedHealth Group, Inc.			137				02/01/19			USD			250.00			USD			3,413				(118,163	)
Verizon Communications, Inc.			323				02/01/19			USD			58.00			USD			1,816				(23,579	)
Verizon Communications, Inc.			875				02/01/19			USD			57.00			USD			4,919				(99,750	)
Wells Fargo & Co.			600				02/01/19			USD			49.00			USD			2,765				(38,100	)
Wells Fargo & Co.			699				02/01/19			USD			47.00			USD			3,221				(93,666	)
State Street Corp.			271				02/06/19			USD			64.24			USD			1,709				(63,128	)
Novartis AG — ADR			327				02/07/19			USD			84.73			USD			2,806				(94,388	)
Taiwan Semiconductor Manufacturing Co. Ltd.			540				02/07/19			USD			38.20			USD			1,993				(64,573	)
AXA Equitable Holdings, Inc.			449				02/08/19			USD			18.05			USD			747				(9,403	)
American International Group, Inc.			254				02/08/19			USD			40.00			USD			1,001				(41,529	)
Bank of America Corp.			1,257				02/08/19			USD			25.00			USD			3,097				(111,873	)
Bank of America Corp.			274				02/08/19			USD			24.64			USD			675				(25,798	)
Cisco Systems, Inc.			132				02/08/19			USD			42.74			USD			572				(26,486	)
Comcast Corp., Class A			382				02/08/19			USD			35.32			USD			1,301				(31,010	)
International Paper Co.			210				02/08/19			USD			42.55			USD			848				(23,827	)
Johnson Controls International PLC			330				02/08/19			USD			34.00			USD			978				(3,087	)
Merck & Co., Inc.			545				02/08/19			USD			79.90			USD			4,164				(45,238	)
Pfizer, Inc.			393				02/08/19			USD			42.66			USD			1,715				(68,772	)
Suncor Energy, Inc.			824				02/08/19			USD			30.01			USD			2,305				(38,158	)
Verizon Communications, Inc.			875				02/08/19			USD			57.01			USD			4,919				(92,039	)

 

 

SCHEDULES OF INVESTMENTS			45

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Wells Fargo & Co.			699				02/08/19			USD			47.01			USD			3,221			$	(63,645	)
FirstEnergy Corp.			497				02/11/19			USD			38.20			USD			1,866				(40,614	)
FirstEnergy Corp.			304				02/11/19			USD			38.25			USD			1,142				(19,528	)
AXA Equitable Holdings, Inc.			514				02/13/19			USD			16.27			USD			855				(47,420	)
Novartis AG — ADR			328				02/13/19			USD			84.73			USD			2,815				(100,671	)
Taiwan Semiconductor Manufacturing Co. Ltd.			538				02/13/19			USD			37.97			USD			1,986				(60,874	)
American International Group, Inc.			289				02/15/19			USD			45.00			USD			1,139				(9,248	)
American International Group, Inc.			402				02/15/19			USD			39.00			USD			1,584				(89,043	)
Anadarko Petroleum Corp.			128				02/15/19			USD			55.00			USD			561				(3,328	)
Bank of America Corp.			642				02/15/19			USD			27.00			USD			1,582				(18,618	)
Bank of America Corp.			870				02/15/19			USD			29.00			USD			2,144				(4,785	)
Cisco Systems, Inc.			154				02/15/19			USD			46.00			USD			667				(14,245	)
Cisco Systems, Inc.			132				02/15/19			USD			43.00			USD			572				(28,710	)
Citigroup, Inc.			312				02/15/19			USD			62.50			USD			1,624				(4,836	)
Citigroup, Inc.			191				02/15/19			USD			52.50			USD			994				(46,986	)
Cognizant Technology Solutions Corp., Class A			82				02/15/19			USD			65.00			USD			521				(17,425	)
Comcast Corp., Class A			209				02/15/19			USD			40.00			USD			712				(2,090	)
Dollar General Corp.			324				02/15/19			USD			110.00			USD			3,502				(115,020	)
Goldman Sachs Group, Inc.			127				02/15/19			USD			180.00			USD			2,122				(45,403	)
JPMorgan Chase & Co.			493				02/15/19			USD			105.00			USD			4,813				(55,956	)
Johnson Controls International PLC			164				02/15/19			USD			32.00			USD			486				(8,364	)
Lowe’s Cos., Inc.			153				02/15/19			USD			95.00			USD			1,413				(41,616	)
Marathon Petroleum Corp.			335				02/15/19			USD			62.50			USD			1,977				(66,163	)
Masco Corp.			164				02/15/19			USD			30.00			USD			480				(18,040	)
Medtronic PLC			170				02/15/19			USD			97.50			USD			1,546				(13,515	)
Merck & Co., Inc.			269				02/15/19			USD			80.00			USD			2,055				(26,093	)
MetLife, Inc.			800				02/15/19			USD			45.95			USD			3,285				(21,657	)
Microsoft Corp.			601				02/15/19			USD			106.20			USD			6,104				(205,098	)
Oracle Corp.			1,887				02/15/19			USD			50.00			USD			8,520				(43,401	)
Pentair PLC			272				02/15/19			USD			40.00			USD			1,028				(21,080	)
Procter & Gamble Co.			410				02/15/19			USD			97.50			USD			3,769				(38,950	)
QUALCOMM, Inc.			230				02/15/19			USD			60.00			USD			1,309				(38,410	)
State Street Corp.			273				02/15/19			USD			67.50			USD			1,722				(43,953	)
TOTAL SA — ADR			277				02/15/19			USD			55.00			USD			1,445				(23,545	)
Union Pacific Corp.			85				02/15/19			USD			145.00			USD			1,175				(30,388	)
Verizon Communications, Inc.			380				02/15/19			USD			55.00			USD			2,136				(92,910	)
Wells Fargo & Co.			1,121				02/15/19			USD			47.50			USD			5,166				(154,698	)
Williams Cos., Inc.			421				02/15/19			USD			26.00			USD			928				(10,314	)
Williams Cos., Inc.			580				02/15/19			USD			25.00			USD			1,279				(13,630	)
Williams Cos., Inc.			206				02/15/19			USD			22.00			USD			454				(22,763	)
AXA Equitable Holdings, Inc.			515				02/20/19			USD			16.27			USD			856				(46,090	)
Comcast Corp., Class A			382				02/21/19			USD			35.32			USD			1,301				(39,014	)
Johnson Controls International PLC			165				02/22/19			USD			33.00			USD			489				(5,165	)
AXA Equitable Holdings, Inc.			414				02/27/19			USD			15.97			USD			688				(46,209	)
AXA Equitable Holdings, Inc.			414				03/06/19			USD			15.97			USD			688				(48,294	)
Lowe’s Cos., Inc.			144				03/15/19			USD			100.00			USD			1,330				(33,192	)
Mondelez International, Inc.			393				03/15/19			USD			43.00			USD			1,573				(22,794	)
Novo Nordisk A/S — ADR			483				03/15/19			USD			46.00			USD			2,225				(107,468	)
																						$	(8,159,536	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Bayer AG, Registered Shares		Goldman Sachs International			19,400				01/03/19			EUR			67.90			EUR			1,178			$	(1	)
CRH PLC		UBS AG			45,000				01/03/19			GBP			23.26			GBP			935				—
Diageo PLC		Morgan Stanley & Co. International PLC			2,500				01/03/19			GBP			27.80			GBP			70				(1,285	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			25,000				01/03/19			EUR			34.41			EUR			765				(64	)
AstraZeneca PLC		Goldman Sachs International			35,500				01/04/19			GBP			60.02			GBP			2,079				(11,104	)
BP PLC		Barclays Bank PLC			89,200				01/04/19			GBP			5.52			GBP			442				—
BP PLC		UBS AG			88,900				01/04/19			GBP			5.38			GBP			441				(9	)
Johnson Controls International PLC		JPMorgan Chase Bank N.A.			17,800				01/04/19			USD			34.57			USD			528				—
Diageo PLC		Credit Suisse International			66,400				01/08/19			GBP			27.56			GBP			1,862				(53,041	)

 

 

46		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Enterprise Products Partners LP		Bank of America N.A.			147,300				01/08/19			USD			27.16			USD			3,622			$	(121	)
AstraZeneca PLC		Credit Suisse International			110,500				01/09/19			GBP			64.58			GBP			6,471				(1,075	)
BP PLC		Morgan Stanley & Co. International PLC			790,000				01/09/19			GBP			5.28			GBP			3,918				(12,081	)
Lenovo Group Ltd.		Goldman Sachs International			3,036,000				01/09/19			HKD			6.02			HKD			16,060				(392	)
Nestle SA, Registered Shares		Credit Suisse International			42,000				01/09/19			CHF			85.34			CHF			3,350				(2,775	)
Constellation Software, Inc.		Morgan Stanley & Co. International PLC			7,500				01/11/19			CAD			953.83			CAD			6,554				(6,803	)
BCE, Inc.		Credit Suisse International			36,100				01/14/19			USD			39.57			USD			1,427				(18,266	)
Diageo PLC		Credit Suisse International			66,400				01/15/19			GBP			27.56			GBP			1,862				(67,044	)
BP PLC		Morgan Stanley & Co. International PLC			790,000				01/16/19			GBP			5.33			GBP			3,918				(20,234	)
CRH PLC		UBS AG			45,000				01/16/19			GBP			23.37			GBP			935				(283	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			223,000				01/16/19			EUR			32.73			EUR			6,824				(27,772	)
Lenovo Group Ltd.		Goldman Sachs International			3,036,000				01/16/19			HKD			6.02			HKD			16,060				(3,662	)
Nestle SA, Registered Shares		Credit Suisse International			42,000				01/16/19			CHF			85.85			CHF			3,350				(5,862	)
BAE Systems PLC		Goldman Sachs International			91,200				01/17/19			GBP			5.00			GBP			419				(1,887	)
BCE, Inc.		Bank of America N.A.			18,400				01/23/19			USD			42.53			USD			727				(519	)
Diageo PLC		Credit Suisse International			48,200				01/23/19			GBP			28.37			GBP			1,352				(25,052	)
AstraZeneca PLC		UBS AG			66,400				01/24/19			GBP			63.35			GBP			3,888				(16,430	)
BAE Systems PLC		Goldman Sachs International			91,200				01/24/19			GBP			5.00			GBP			419				(3,286	)
Koninklijke Philips NV		Goldman Sachs International			25,000				01/24/19			EUR			33.62			EUR			765				(2,486	)
Siemens AG		Goldman Sachs International			35,600				01/24/19			EUR			102.23			EUR			3,467				(17,081	)
CRH PLC		Goldman Sachs International			72,500				01/29/19			GBP			22.15			GBP			1,506				(14,591	)
Diageo PLC		Credit Suisse International			48,200				01/29/19			GBP			28.37			GBP			1,352				(28,720	)
CRH PLC		Morgan Stanley & Co. International PLC			25,500				01/31/19			GBP			20.94			GBP			530				(23,077	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			30,000				01/31/19			CHF			86.45			CHF			2,393				(3,498	)
Public Service Enterprise Group, Inc.		Barclays Bank PLC			75,000				01/31/19			USD			53.47			USD			3,904				(57,668	)
Bayer AG		Goldman Sachs International			53,900				02/05/19			EUR			68.17			EUR			3,272				(30,486	)
BAE Systems PLC		Goldman Sachs International			419,500				02/06/19			GBP			4.72			GBP			1,926				(55,449	)
BP PLC — ADR Each Representing Six PLC		Credit Suisse International			1,175,000				02/06/19			GBP			5.13			GBP			5,828				(169,677	)
CRH PLC		Credit Suisse International			36,900				02/06/19			GBP			20.89			GBP			766				(37,790	)
Diageo PLC		UBS AG			32,600				02/06/19			GBP			27.94			GBP			914				(29,407	)
Koninklijke Philips NV		Goldman Sachs International			184,500				02/06/19			EUR			33.68			EUR			5,646				(48,758	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			800				02/06/19			CHF			82.55			CHF			64				(634	)
Baker Hughes a GE Co.		Deutsche Bank AG			45,800				02/08/19			USD			22.01			USD			985				(30,504	)
Koninklijke Philips NV		UBS AG			122,300				02/13/19			EUR			34.05			EUR			3,742				(32,712	)
																								$	(861,586	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	14,179,646			$	(798,222	)		$	(9,021,122	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	21,865			$	—			$	—			$	—			$	21,865
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	9,021,122			$	—			$	—			$	—			$	9,021,122

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

 

 

SCHEDULES OF INVESTMENTS			47

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

For the year ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(40,564	)		$	—			$	—			$	—			$	(40,564	)
Options written			—				—				(5,219,539	)			—				—				—				(5,219,539	)
		$	—			$	—			($	5,260,103	)		$	—			$	—			$	—			($	5,260,103	)

 

(a)

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Change in Unrealized Appreciation on:
Options purchased(a)		$	—			$	—			$	(21,427	)		$	—			$	—			$	—			$	(21,427	)
Options written			—				—				17,485,572				—				—				—				17,485,572
		$	—			$	—			$	17,464,145			$	—			$	—			$	—			$	17,464,145

 

(a)

Options purchased are included in net change in unrealized appreciation (depreciation) from investments.

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	7,075
Average value of option contracts written		$	13,572,916

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Derivative Financial Instruments:
Options		$	21,865	(a)		$	9,021,122
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(21,865	)			(8,159,536	)
Total derivative assets and liabilities subject to an MNA		$	—			$	861,586

 

(a)

Includes options purchased at value which is included in Investments at value – unaffiliated in the Statements of Assets and Liabilities and reported in the Schedule of Investments.

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities  (b)
Bank of America N.A.		$	640			$	—			$	—			$	—			$	640
Barclays Bank PLC			57,668				—				—				—				57,668
Credit Suisse International			409,302				—				(409,302	)			—				—
Deutsche Bank AG			30,504								—				—				30,504
Goldman Sachs International			189,183				—				(189,183	)			—				—
Morgan Stanley & Co. International PLC			95,448				—				(95,448	)			—				—
UBS AG			78,841				—				—				—				78,841
		$	861,586			$	—			$	(693,933	)		$	—			$	167,653

 

(a)

Excess of collateral received from the individual counterparty is not shown for financial reporting purposes.

(b)

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

 

 

48		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Aerospace & Defense		$	18,875,564			$	6,071,577			$	—			$	24,947,141
Banks			228,587,517				—				—				228,587,517
Beverages			17,669,067				16,285,915				—				33,954,982
Building Products			16,858,836				—				—				16,858,836
Capital Markets			60,690,331				—				—				60,690,331
Chemicals			16,033,037				—				—				16,033,037
Communications Equipment			29,993,175				—				—				29,993,175
Construction Materials			—				10,265,793				—				10,265,793
Containers & Packaging			5,476,852				—				—				5,476,852
Diversified Financial Services			9,378,339				—				—				9,378,339
Diversified Telecommunication Services			78,961,186				—				—				78,961,186
Electric Utilities			50,354,637				—				—				50,354,637
Electronic Equipment, Instruments & Components			3,788,277				—				—				3,788,277
Energy Equipment & Services			3,421,295				—				—				3,421,295
Food Products			16,978,589				16,063,731				—				33,042,320
Health Care Equipment & Supplies			27,438,084				35,052,090				—				62,490,174
Health Care Providers & Services			116,813,585				—				—				116,813,585
Household Durables			9,053,702				—				—				9,053,702
Household Products			17,412,406				—				—				17,412,406
Industrial Conglomerates			37,222,193				6,853,451				—				44,075,644
Insurance			109,989,554				—				—				109,989,554
IT Services			11,414,910				—				—				11,414,910
Leisure Products			4,796,259				—				—				4,796,259
Machinery			4,125,198				—				—				4,125,198
Media			26,494,475				—				—				26,494,475
Multi-Utilities			14,701,002				—				—				14,701,002
Multiline Retail			13,771,229				—				—				13,771,229
Oil, Gas & Consumable Fuels			145,253,765				31,970,100				—				177,223,865
Personal Products			11,969,424				—				—				11,969,424
Pharmaceuticals			136,468,392				47,955,520				—				184,423,912
Road & Rail			7,467,185				—				—				7,467,185
Semiconductors & Semiconductor Equipment			32,695,406				—				—				32,695,406
Software			94,034,189				—				—				94,034,189
Specialty Retail			13,585,232				—				—				13,585,232
Technology Hardware, Storage & Peripherals			4,021,581				18,834,982				—				22,856,563
Tobacco			18,512,360				—				—				18,512,360
Short-Term Securities			44,526,058				—				—				44,526,058
Options Purchased
Equity Contracts			21,865				—				—				21,865
		$	1,458,854,756			$	189,353,159			$	—			$	1,648,207,915
Derivative Financial Instruments(a)
Liabilities:
Equity contracts		$	(6,094,175	)		$	(2,926,947	)		$	—			$	(9,021,122	)

 

(a)

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

During the year ended December 31, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS			49

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Schedule of Investments   December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE) (Percentages shown are based on Net Assets)

 

 

 

50		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

(g)	During the year ended December 31, 2018, 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 Held at 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			13,118,524				6,583,922				19,702,446			$	19,702,446			$	99,772			$	—			$	—

 

(a)

Includes net capital gain distributions, if applicable.

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Wells Fargo & Co.			166				01/04/19			USD			50.00			USD			765			$	249
Wells Fargo & Co.			166				01/11/19			USD			51.50			USD			765				664
Altria Group, Inc.			158				01/18/19			USD			62.50			USD			780				711
																						$	1,624

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
U.S. Bancorp			34				01/03/19			USD			55.50			USD			155			$	—
3M Co.			75				01/04/19			USD			202.50			USD			1,429				(600	)
AbbVie, Inc.			112				01/04/19			USD			92.00			USD			1,033				(15,512	)
Altria Group, Inc.			212				01/04/19			USD			55.50			USD			1,047				(8,268	)
Coca-Cola Co.			561				01/04/19			USD			50.00			USD			2,656				(1,683	)
Genuine Parts Co.			164				01/04/19			USD			101.00			USD			1,575				(4,920	)
Medtronic PLC			41				01/04/19			USD			95.00			USD			373				(328	)
Pfizer, Inc.			408				01/04/19			USD			43.50			USD			1,781				(21,420	)
Pfizer, Inc.			102				01/04/19			USD			44.50			USD			445				(1,734	)
Pfizer, Inc.			102				01/04/19			USD			46.50			USD			445				(408	)
Pfizer, Inc.			60				01/04/19			USD			45.00			USD			262				(420	)
Philip Morris International, Inc.			179				01/04/19			USD			87.00			USD			1,195				(8,950	)
Procter & Gamble Co.			57				01/04/19			USD			94.50			USD			524				(769	)
Rogers Communications, Inc., Class B			245				01/04/19			CAD			71.50			CAD			1,714				(2,512	)
Texas Instruments, Inc.			80				01/04/19			USD			101.00			USD			756				(280	)
U.S. Bancorp			35				01/04/19			USD			55.50			USD			160				—
United Technologies Corp.			112				01/04/19			USD			123.00			USD			1,193				(2,800	)
Wells Fargo & Co.			90				01/04/19			USD			56.00			USD			415				(180	)
Wells Fargo & Co.			76				01/04/19			USD			54.00			USD			350				(1,292	)
3M Co.			73				01/11/19			USD			210.00			USD			1,391				(803	)
AbbVie, Inc.			124				01/11/19			USD			92.00			USD			1,143				(27,156	)
Altria Group, Inc.			212				01/11/19			USD			55.01			USD			1,047				(70	)
Genuine Parts Co.			163				01/11/19			USD			105.00			USD			1,565				(6,520	)
Johnson & Johnson			143				01/11/19			USD			146.00			USD			1,845				(572	)
Microsoft Corp.			114				01/11/19			USD			112.00			USD			1,158				(1,368	)
PepsiCo, Inc.			72				01/11/19			USD			120.00			USD			795				(504	)
Pfizer, Inc.			102				01/11/19			USD			46.50			USD			445				(918	)
Pfizer, Inc.			59				01/11/19			USD			45.00			USD			258				(1,416	)
Procter & Gamble Co.			108				01/11/19			USD			93.00			USD			993				(11,340	)
Texas Instruments, Inc.			80				01/11/19			USD			100.00			USD			756				(4,400	)
U.S. Bancorp			149				01/11/19			USD			54.50			USD			681				(596	)

 

 

SCHEDULES OF INVESTMENTS			51

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
U.S. Bancorp			140				01/11/19			USD			54.00			USD			640			$	(560	)
Wells Fargo & Co.			90				01/11/19			USD			56.00			USD			415				(270	)
Wells Fargo & Co.			76				01/11/19			USD			54.00			USD			350				(228	)
AbbVie, Inc.			112				01/18/19			USD			92.50			USD			1,033				(24,584	)
AbbVie, Inc.			67				01/18/19			USD			87.50			USD			618				(37,185	)
Altria Group, Inc.			158				01/18/19			USD			67.50			USD			780				(474	)
Altria Group, Inc.			613				01/18/19			USD			55.00			USD			3,028				(6,743	)
Cisco Systems, Inc.			170				01/18/19			USD			46.00			USD			737				(3,910	)
Citizens Financial Group, Inc.			287				01/18/19			USD			37.25			USD			853				(1	)
Coca-Cola Co.			928				01/18/19			USD			50.00			USD			4,394				(11,600	)
Genuine Parts Co.			218				01/18/19			USD			105.00			USD			2,093				(3,270	)
Johnson & Johnson			326				01/18/19			USD			145.75			USD			4,207				(906	)
M&T Bank Corp.			150				01/18/19			USD			165.00			USD			2,147				(11,250	)
Medtronic PLC			110				01/18/19			USD			96.25			USD			1,001				(4,853	)
Microsoft Corp.			168				01/18/19			USD			110.00			USD			1,706				(7,896	)
PepsiCo, Inc.			389				01/18/19			USD			120.00			USD			4,298				(4,473	)
Pfizer, Inc.			291				01/18/19			USD			44.00			USD			1,270				(24,008	)
Pfizer, Inc.			102				01/18/19			USD			45.00			USD			445				(4,233	)
Philip Morris International, Inc.			147				01/18/19			USD			90.00			USD			981				(367	)
Procter & Gamble Co.			115				01/18/19			USD			95.00			USD			1,057				(7,647	)
Rogers Communications, Inc., Class B			348				01/18/19			CAD			70.00			CAD			2,435				(28,422	)
Rogers Communications, Inc., Class B			324				01/18/19			CAD			72.00			CAD			2,267				(8,662	)
Texas Instruments, Inc.			68				01/18/19			USD			100.00			USD			643				(6,528	)
U.S. Bancorp			107				01/18/19			USD			55.00			USD			489				(107	)
United Parcel Service, Inc., Class B			172				01/18/19			USD			105.00			USD			1,678				(7,654	)
United Technologies Corp.			81				01/18/19			USD			115.00			USD			862				(3,280	)
United Technologies Corp.			80				01/18/19			USD			125.00			USD			852				(880	)
Wells Fargo & Co.			150				01/18/19			USD			55.00			USD			691				(150	)
Wells Fargo & Co.			121				01/18/19			USD			52.50			USD			558				(665	)
Paychex, Inc.			141				01/18/19			USD			70.00			USD			919				(2,115	)
3M Co.			76				01/25/19			USD			205.00			USD			1,448				(6,726	)
AbbVie, Inc.			320				01/25/19			USD			88.50			USD			2,950				(165,600	)
Altria Group, Inc.			501				01/25/19			USD			55.00			USD			2,474				(8,267	)
Cisco Systems, Inc.			455				01/25/19			USD			49.00			USD			1,972				(2,502	)
Cisco Systems, Inc.			346				01/25/19			USD			42.00			USD			1,499				(70,238	)
Coca-Cola Co.			46				01/25/19			USD			50.00			USD			218				(874	)
International Paper Co.			626				01/25/19			USD			44.50			USD			2,527				(13,459	)
Johnson & Johnson			123				01/25/19			USD			148.00			USD			1,587				(861	)
Johnson & Johnson			12				01/25/19			USD			136.00			USD			155				(1,236	)
Medtronic PLC			40				01/25/19			USD			95.50			USD			364				(2,820	)
Microsoft Corp.			100				01/25/19			USD			113.00			USD			1,016				(4,650	)
Microsoft Corp.			20				01/25/19			USD			106.00			USD			203				(4,160	)
PepsiCo, Inc.			315				01/25/19			USD			113.00			USD			3,480				(51,345	)
Pfizer, Inc.			108				01/25/19			USD			45.00			USD			471				(6,048	)
Pfizer, Inc.			109				01/25/19			USD			44.50			USD			476				(8,121	)
Pfizer, Inc.			182				01/25/19			USD			44.00			USD			794				(17,745	)
Philip Morris International, Inc.			118				01/25/19			USD			88.00			USD			788				(5,192	)
Procter & Gamble Co.			108				01/25/19			USD			93.00			USD			993				(18,468	)
Texas Instruments, Inc.			38				01/25/19			USD			101.00			USD			359				(6,023	)
U.S. Bancorp			99				01/25/19			USD			52.00			USD			452				(594	)
United Parcel Service, Inc., Class B			171				01/25/19			USD			106.00			USD			1,668				(9,063	)
Wells Fargo & Co.			86				01/25/19			USD			48.00			USD			396				(7,396	)
Pfizer, Inc.			40				01/28/19			USD			45.10			USD			175				(2,461	)
Cisco Systems, Inc.			464				01/31/19			USD			46.25			USD			2,011				(25,495	)
3M Co.			117				02/01/19			USD			202.50			USD			2,229				(24,512	)
Cisco Systems, Inc.			346				02/01/19			USD			42.50			USD			1,499				(66,951	)
Cisco Systems, Inc.			293				02/01/19			USD			48.28			USD			1,270				(7,469	)
Genuine Parts Co.			178				02/01/19			USD			97.00			USD			1,709				(38,715	)
International Paper Co.			626				02/01/19			USD			44.50			USD			2,527				(21,597	)
Medtronic PLC			220				02/01/19			USD			93.00			USD			2,001				(37,730	)
Microsoft Corp.			20				02/01/19			USD			106.00			USD			203				(5,210	)
Pfizer, Inc.			60				02/01/19			USD			44.00			USD			262				(6,630	)

 

 

52		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Philip Morris International, Inc.			163				02/01/19			USD			71.00			USD			1,088			$	(12,062	)
U.S. Bancorp			158				02/01/19			USD			47.50			USD			722				(11,692	)
Wells Fargo & Co.			118				02/01/19			USD			49.00			USD			544				(7,493	)
Wells Fargo & Co.			151				02/01/19			USD			47.00			USD			696				(20,234	)
Cisco Systems, Inc.			346				02/08/19			USD			42.74			USD			1,499				(69,426	)
International Paper Co.			774				02/08/19			USD			42.55			USD			3,124				(87,820	)
Pfizer, Inc.			26				02/08/19			USD			42.66			USD			113				(4,550	)
US Bancorp			201				02/08/19			USD			47.00			USD			919				(21,306	)
Wells Fargo & Co.			151				02/08/19			USD			47.01			USD			696				(13,749	)
Cisco Systems, Inc.			464				02/15/19			USD			46.00			USD			2,011				(42,920	)
Cisco Systems, Inc.			346				02/15/19			USD			43.00			USD			1,499				(75,255	)
Coca-Cola Co.			654				02/15/19			USD			50.00			USD			3,097				(27,795	)
Genuine Parts Co.			260				02/15/19			USD			105.00			USD			2,497				(9,750	)
Medtronic PLC			78				02/15/19			USD			97.50			USD			709				(6,201	)
Microsoft Corp.			31				02/15/19			USD			106.20			USD			315				(10,579	)
Philip Morris International, Inc.			163				02/15/19			USD			72.50			USD			1,088				(15,322	)
Procter & Gamble Co.			430				02/15/19			USD			97.50			USD			3,953				(40,850	)
Rogers Communications, Inc., Class B			187				02/15/19			CAD			72.00			CAD			1,308				(13,972	)
TELUS Corp.			472				02/15/19			CAD			48.00			CAD			2,136				(7,260	)
US Bancorp			201				02/15/19			USD			47.50			USD			919				(19,397	)
United Technologies Corp.			164				02/15/19			USD			115.00			USD			1,746				(23,944	)
Wells Fargo & Co.			249				02/15/19			USD			47.50			USD			1,147				(34,362	)
																						$	(1,564,757	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
ANTA Sports Products Ltd.		Morgan Stanley & Co. International PLC			150,000				01/03/19			HKD			35.93			HKD			5,624			$	(35,292	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			155,000				01/03/19			AUD			13.83			AUD			2,055				(7	)
DBS Group Holdings Ltd.		UBS AG			68,000				01/03/19			SGD			23.88			SGD			1,612				(8,367	)
Diageo PLC		Morgan Stanley & Co. International PLC			12,400				01/03/19			GBP			27.80			GBP			348				(6,376	)
Heineken NV		Morgan Stanley & Co. International PLC			24,000				01/03/19			EUR			82.09			EUR			1,851				(293	)
Kone OYJ, Class B		Citibank N.A.			30,100				01/03/19			EUR			45.50			EUR			1,254				(4	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			27,000				01/03/19			EUR			34.41			EUR			826				(69	)
M&T Bank Corp.		Barclays Bank PLC			16,400				01/03/19			USD			167.66			USD			2,347				—
Novo Nordisk A/S, Class B		Morgan Stanley & Co. International PLC			13,000				01/03/19			DKK			303.49			DKK			3,891				(3,588	)
Paychex, Inc.		Morgan Stanley & Co. International PLC			14,100				01/03/19			USD			70.16			USD			919				(1	)
Sonic Healthcare Ltd.		Morgan Stanley & Co. International PLC			20,000				01/03/19			AUD			22.38			AUD			443				(2,141	)
TELUS Corp.		Credit Suisse International			19,900				01/03/19			CAD			46.84			CAD			900				(2	)
AstraZeneca PLC		Goldman Sachs International			44,200				01/04/19			GBP			60.02			GBP			2,588				(13,825	)
GlaxoSmithKline PLC		Goldman Sachs International			164,000				01/04/19			GBP			15.42			GBP			2,452				(10,703	)
Imperial Brands PLC		Barclays Bank PLC			77,500				01/04/19			GBP			27.70			GBP			1,845				(98	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			35,400				01/04/19			CHF			85.93			CHF			2,824				(203	)
Schneider Electric SE		Barclays Bank PLC			11,000				01/04/19			EUR			65.58			EUR			651				(3	)
Unilever PLC		Goldman Sachs International			60,000				01/04/19			GBP			41.94			GBP			2,471				(10,111	)
Rogers Communications, Inc., Class B		Citibank N.A.			44,000				01/07/19			CAD			68.72			CAD			3,078				(49,625	)
Deutsche Post AG, Registered Shares		Citibank N.A.			73,200				01/08/19			EUR			29.42			EUR			1,745				(124	)
Diageo PLC		Credit Suisse International			24,900				01/08/19			GBP			27.56			GBP			698				(19,890	)
Sanofi		Morgan Stanley & Co. International PLC			35,500				01/08/19			EUR			80.59			EUR			2,688				(2,628	)
Svenska Handelsbanken AB		Barclays Bank PLC			117,200				01/08/19			SEK			100.10			SEK			11,557				(9,886	)
Amcor Ltd.		UBS AG			398,100				01/09/19			AUD			13.33			AUD			5,279				(34,568	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			27,000				01/09/19			AUD			23.55			AUD			596				(479	)
Kone OYJ, Class B		UBS AG			27,400				01/09/19			EUR			43.84			EUR			1,142				(2,226	)
Novartis AG, Registered Shares		UBS AG			21,500				01/09/19			CHF			90.35			CHF			1,810				(1,068	)
RELX PLC		Goldman Sachs International			52,000				01/09/19			EUR			19.20			EUR			934				(607	)
British American Tobacco PLC		UBS AG			72,800				01/10/19			GBP			28.14			GBP			1,817				(7,992	)
SGS SA, Registered Shares		Goldman Sachs International			1,100				01/10/19			CHF			2,381.58			CHF			2,434				(1,385	)
SGS SA, Registered Shares		UBS AG			365				01/10/19			CHF			2,315.33			CHF			808				(2,222	)
Sonic Healthcare Ltd.		Citibank N.A.			95,000				01/10/19			AUD			22.99			AUD			2,104				(5,946	)

 

 

SCHEDULES OF INVESTMENTS			53

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
TELUS Corp.		Citibank N.A.			28,500				01/11/19			CAD			46.93			CAD			1,290			$	(473	)
TELUS Corp.		Royal Bank of Canada			14,900				01/11/19			CAD			48.03			CAD			674				(229	)
ANTA Sports Products Ltd.		Morgan Stanley & Co. International PLC			360,000				01/15/19			HKD			36.62			HKD			13,496				(92,749	)
Deutsche Post AG, Registered Shares		Citibank N.A.			73,200				01/15/19			EUR			29.42			EUR			1,745				—
Diageo PLC		Credit Suisse International			24,900				01/15/19			GBP			27.56			GBP			698				(25,142	)
Heineken NV		Morgan Stanley & Co. International PLC			26,200				01/15/19			EUR			79.37			EUR			2,021				(13,743	)
TELUS Corp.		Royal Bank of Canada			20,000				01/15/19			CAD			47.75			CAD			905				(1,001	)
United Overseas Bank Ltd.		Morgan Stanley & Co. International PLC			149,400				01/15/19			SGD			24.59			SGD			3,684				(50,434	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			155,000				01/16/19			AUD			13.90			AUD			2,055				(2,016	)
Ansell Ltd.		UBS AG			62,200				01/16/19			AUD			23.96			AUD			1,372				(1,422	)
DBS Group Holdings Ltd.		JPMorgan Chase Bank N.A.			87,800				01/16/19			SGD			24.33			SGD			2,081				(11,954	)
DBS Group Holdings Ltd.		UBS AG			68,000				01/16/19			SGD			23.88			SGD			1,612				(17,119	)
GlaxoSmithKline PLC		Goldman Sachs International			164,000				01/16/19			GBP			15.42			GBP			2,452				(33,183	)
Imperial Tobacco PLC		Barclays Bank PLC			77,500				01/16/19			GBP			27.70			GBP			1,845				(6,760	)
Japan Tobacco, Inc.		JPMorgan Chase Bank N.A.			35,900				01/16/19			JPY			2,926.73			JPY			93,495				(162	)
Kone OYJ, Class B		Goldman Sachs International			44,200				01/16/19			EUR			45.37			EUR			1,842				(1,908	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			27,000				01/16/19			EUR			34.60			EUR			826				(586	)
Novartis AG, Registered Shares		UBS AG			21,500				01/16/19			CHF			90.35			CHF			1,810				(3,545	)
RELX PLC		Credit Suisse International			69,700				01/16/19			EUR			18.29			EUR			1,252				(16,999	)
Sonic Healthcare Ltd.		Morgan Stanley & Co. International PLC			20,000				01/16/19			AUD			22.49			AUD			443				(4,174	)
BAE Systems PLC		Goldman Sachs International			82,500				01/17/19			GBP			5.00			GBP			379				(1,707	)
Sanofi		Morgan Stanley & Co. International PLC			35,500				01/17/19			EUR			80.59			EUR			2,688				(9,056	)
Schneider Electric SE		Goldman Sachs International			11,000				01/17/19			EUR			65.60			EUR			651				(674	)
Svenska Handelsbanken AB		Goldman Sachs International			117,200				01/17/19			SEK			100.13			SEK			11,557				(15,395	)
TELUS Corp.		Royal Bank of Canada			36,900				01/18/19			CAD			47.00			CAD			1,670				(3,514	)
Amcor Ltd.		UBS AG			82,300				01/23/19			AUD			13.38			AUD			1,091				(10,548	)
Diageo PLC		Credit Suisse International			24,900				01/23/19			GBP			28.37			GBP			698				(12,942	)
Kone OYJ, Class B		Credit Suisse International			49,500				01/23/19			EUR			42.90			EUR			2,063				(30,214	)
Svenska Handelsbanken AB		Credit Suisse International			187,300				01/23/19			SEK			99.34			SEK			18,470				(36,628	)
TELUS Corp.		Royal Bank of Canada			21,600				01/23/19			CAD			46.75			CAD			977				(2,022	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			455,000				01/23/19			USD			228.01			USD			101,551				(84,685	)
ANTA Sports Products Ltd.		Goldman Sachs International			199,000				01/24/19			HKD			38.81			HKD			7,461				(34,320	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			24,200				01/24/19			AUD			23.19			AUD			534				(3,068	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			4,800				01/24/19			AUD			23.40			AUD			106				(454	)
BAE Systems PLC		Goldman Sachs International			82,500				01/24/19			GBP			5.00			GBP			379				(2,972	)
British American Tobacco PLC		Goldman Sachs International			50,700				01/24/19			GBP			28.30			GBP			1,265				(7,061	)
Deutsche Post AG, Registered Shares		UBS AG			65,300				01/24/19			EUR			28.55			EUR			1,557				(4,286	)
Koninklijke Philips NV		Goldman Sachs International			56,000				01/24/19			EUR			33.62			EUR			1,714				(5,568	)
Novo Nordisk A/S, Class B		Goldman Sachs International			13,000				01/24/19			DKK			307.22			DKK			3,891				(8,453	)
Sonic Healthcare Ltd.		UBS AG			79,400				01/24/19			AUD			21.83			AUD			1,759				(40,178	)
Unilever PLC		Credit Suisse International			66,300				01/24/19			GBP			43.23			GBP			2,731				(21,552	)
TELUS Corp.		Royal Bank of Canada			29,000				01/25/19			CAD			48.00			CAD			1,312				(2,994	)
Diageo PLC		Credit Suisse International			24,900				01/29/19			GBP			28.37			GBP			698				(14,836	)
GlaxoSmithKline PLC		Deutsche Bank AG			31,900				01/29/19			GBP			14.67			GBP			477				(26,027	)
Kone OYJ, Class B		UBS AG			38,800				01/29/19			EUR			44.04			EUR			1,617				(15,968	)
Nestle SA, Registered Shares		Deutsche Bank AG			58,300				01/29/19			CHF			83.97			CHF			4,651				(20,705	)
Novo Nordisk A/S, Class B		Goldman Sachs International			27,200				01/29/19			DKK			301.92			DKK			8,140				(34,353	)
Sonic Healthcare Ltd.		UBS AG			16,600				01/29/19			AUD			21.63			AUD			368				(10,685	)
Amcor Ltd.		UBS AG			141,500				01/30/19			AUD			13.32			AUD			1,876				(24,768	)
Ansell Ltd.		UBS AG			32,300				01/30/19			AUD			23.64			AUD			713				(4,922	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			216,000				01/30/19			GBP			4.68			GBP			991				(28,162	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			455,000				01/30/19			USD			228.01			USD			101,551				(99,099	)
British American Tobacco PLC		Goldman Sachs International			50,700				01/31/19			GBP			28.30			GBP			1,265				(11,305	)
Imperial Brands PLC		Credit Suisse International			64,500				01/31/19			GBP			24.55			GBP			1,536				(31,799	)
Paychex, Inc.		Barclays Bank PLC			50,000				01/31/19			USD			67.79			USD			3,258				(32,493	)
Rogers Communications, Inc., Class B		Citibank N.A.			18,800				01/31/19			CAD			69.94			CAD			1,315				(17,294	)
Schneider Electric S.A.		UBS AG			8,500				01/31/19			EUR			62.83			EUR			503				(6,215	)
TELUS Corp.		Royal Bank of Canada			47,200				01/31/19			CAD			47.75			CAD			2,136				(2,095	)
TELUS Corp.		Royal Bank of Canada			21,500				02/01/19			CAD			46.75			CAD			973				(3,234	)
DBS Group Holdings Ltd.		BNP Paribas S.A.			74,100				02/04/19			SGD			23.77			SGD			1,756				(32,540	)
TELUS Corp.		Goldman Sachs International			25,000				02/04/19			CAD			46.65			CAD			1,131				(4,536	)
United Overseas Bank Ltd.		Morgan Stanley & Co. International PLC			123,300				02/04/19			SGD			24.54			SGD			3,041				(62,973	)

 

 

54		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Japan Tobacco, Inc.		JPMorgan Chase Bank N.A.			37,000				02/05/19			JPY			2,877.38			JPY			96,360			$	(3,493	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			141,500				02/06/19			AUD			13.32			AUD			1,876				(27,692	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			32,300				02/06/19			AUD			23.64			AUD			713				(6,192	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			248,800				02/06/19			GBP			4.79			GBP			1,142				(23,058	)
Diageo PLC		UBS AG			61,100				02/06/19			GBP			27.94			GBP			1,713				(55,115	)
Kone OYJ, Class B		Credit Suisse International			27,400				02/06/19			EUR			43.05			EUR			1,142				(21,866	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			35,400				02/06/19			CHF			82.55			CHF			2,824				(28,043	)
Novartis AG, Registered Shares		Credit Suisse International			94,200				02/06/19			CHF			90.48			CHF			7,930				(32,149	)
RELX PLC		Credit Suisse International			52,000				02/06/19			EUR			18.14			EUR			934				(24,473	)
Sanofi		Credit Suisse International			37,300				02/06/19			EUR			77.09			EUR			2,824				(61,619	)
Sonic Healthcare Ltd.		JPMorgan Chase Bank N.A.			68,900				02/06/19			AUD			21.68			AUD			1,526				(44,260	)
Schneider Electric S.A		Morgan Stanley & Co. International PLC			34,400				02/06/19			EUR			62.16			EUR			2,036				(38,175	)
TELUS Corp.		Royal Bank of Canada			24,900				02/06/19			CAD			46.62			CAD			1,127				(4,890	)
Rogers Communications, Inc., Class B		Credit Suisse International			37,500				02/11/19			CAD			71.72			CAD			2,624				(25,448	)
BAE Systems PLC		UBS AG			172,500				02/12/19			GBP			4.71			GBP			792				(26,809	)
GlaxoSmithKline PLC		Goldman Sachs International			50,000				02/12/19			GBP			15.48			GBP			748				(22,194	)
Novo Nordisk A/S, Class B		Goldman Sachs International			30,800				02/12/19			DKK			305.65			DKK			9,218				(40,398	)
ANTA Sports Products Ltd.		Goldman Sachs International			199,000				02/13/19			HKD			38.81			HKD			7,461				(50,979	)
Citizens Financial Group, Inc.		Goldman Sachs International			46,600				02/13/19			USD			34.36			USD			1,385				(3,778	)
Schneider Electric S.A		UBS AG			24,800				02/13/19			EUR			59.53			EUR			1,468				(58,258	)
Unilever PLC		Credit Suisse International			66,300				02/13/19			GBP			43.23			GBP			2,731				(32,017	)
BAE Systems PLC		UBS AG			172,500				02/19/19			GBP			4.71			GBP			792				(29,764	)
Japan Tobacco, Inc.		UBS AG			35,800				02/20/19			JPY			2,870.69			JPY			93,671				(6,136	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			216,000				02/26/19			GBP			4.68			GBP			992				(42,040	)
																								$	(2,044,474	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A			N/A				$	4,274,244			$(487,910)				$	(3,609,231	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	1,624			$	—			$	—			$	—			$	1,624

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	3,609,231			$	—			$	—			$	—			$	3,609,231

 

 

SCHEDULES OF INVESTMENTS			55

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

For the period ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(2,220	)		$	—			$	—			$	—			$	(2,220	)
Options written			—				—				(1,712,691	)			—				—				—				(1,712,691	)
		$	—			$	—			$	(1,714,911	)						$	—			$	—			$	(1,714,911	)

 

(a)

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	(3,011	)		$	—			$	—			$	—			$	(3,011	)
Options written			—				—				3,709,364				—				—				—				3,709,364
		$	—			$	—			$	3,706,353			$	—			$	—			$	—			$	3,706,353

 

(a)

Options purchased are included in net change in unrealized appreciation (depreciation) on investments.

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	406
Average value of option contracts written		$	5,431,119

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Options
Total derivative assets and liabilities in the Statements of Assets and Liabilities		$	1,624			$	3,609,231
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(1,624	)			(1,564,757	)
Total derivative assets and liabilities subject to an MNA		$	—			$	2,044,474

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities  (b)
Barclays Bank PLC		$	49,240			$	—			$	(49,240	)		$	—			$	—
BNP Paribas S.A.			32,540				—				—				—				32,540
Citibank N.A.			73,466				—				(73,466	)			—				—
Credit Suisse International			407,576				—				(407,576	)			—				—
Deutsche Bank AG			46,732				—				—				—				46,732
Goldman Sachs International			315,415				—				(315,415	)			—				—
JPMorgan Chase Bank N.A.			59,869				—				(59,869	)			—				—
Morgan Stanley & Co. International PLC			483,692				—				(483,692	)			—				—
Royal Bank of Canada			19,979				—				—				—				19,979
UBS AG			555,965				—				(552,161	)			—				3,804
		$	2,044,474			$	—			$	(1,941,419	)		$	—			$	103,055

 

(a)

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

(b)

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

 

 

56		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Australia		$	—			$	40,733,642			$	3			$	40,733,645
Canada			48,796,156				—				—				48,796,156
China			—				7,248,060				—				7,248,060
Denmark			—				8,563,240				—				8,563,240
Finland			—				23,057,120				—				23,057,120
France			—				25,574,954				—				25,574,954
Germany			—				17,594,177				—				17,594,177
India			—				7,447,187				711,221				8,158,408
Ireland			9,895,993				—				—				9,895,993
Japan			—				7,377,816				—				7,377,816
Netherlands			—				18,176,165				—				18,176,165
Singapore			—				22,474,053				—				22,474,053
Sweden			—				10,425,147				—				10,425,147
Switzerland			—				42,624,487				—				42,624,487
Taiwan			—				14,689,467				—				14,689,467
United Kingdom			—				116,910,649				—				116,910,649
United States			302,497,520				—				3,818,703				306,316,223
Preferred Stocks			—				—				5,843,081				5,843,081
Short-Term Securities			19,702,446				—				—				19,702,446
Options Purchased:
Equity contracts			1,624				—				—				1,624
		$	380,893,739			$	362,896,164			$	10,373,008			$	754,162,911
Derivative Financial Instruments(a)
Liabilities:
Equity contracts		$	(1,337,378	)		$	(2,271,853	)		$	—			$	(3,609,231	)

 

(a)

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

Transfers between Level 1 and Level 2 were as follows:

 

		Transfers Into Level 2 (a)				Transfers Out of Level 1 (a)
Assets:
Investments:
Common Stocks		$	10,912,439			$	(10,912,439	)

 

(a)

External pricing service used to reflect any significant market movements between the time the Trust valued such foreign securities and the earlier closing of foreign markets.

 

 

SCHEDULES OF INVESTMENTS			57

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced Global Dividend Trust (BOE)

 

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 year 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, 2017		$	4,411,841			$	11,646,491			$	16,058,332
Transfers into Level 3			—				—				—
Transfers out of Level 3			—				—				—
Accrued discounts/premiums			—				—				—
Net realized gain (loss)			—				3,369,128				3,369,128
Net change in unrealized appreciation (depreciation)(a)(b)			(2,519,060	)			(386,567	)			(2,905,627	)
Purchases			2,637,146				—				2,637,146
Sales			—				(8,785,971	)			(8,785,971	)
Closing Balance as of December 31, 2018		$	4,529,927			$	5,843,081			$	10,373,008
Net change in unrealized appreciation (depreciation) on investments held as of December 31, 2018(b)		$	(2,519,060	)		$	(2,435,642	)		$	(4,954,702	)

 

(a)

Included in the related net change in unrealized appreciation (depreciation) in the Statements of Operations.

(b)

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on derivative financial instruments still held at December 31, 2018 is generally due to derivative financial instruments no longer held or categorized as Level 3 at period end.

The following table summarizes the valuation approaches 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 period end. The table does not include Level 3 investments with values based upon unadjusted third party pricing information in the amount of $3. A significant change in the third party information could result in a significantly lower or higher value of such Level 3 investments.

 

Value

Valuation Approach

Unobservable Inputs

Range of Unobservable Inputs Utilized

Weighted Average of Unobservable Inputs

Assets:

Common Stocks

Tangible Book Value Multiple(a)

1.65x

—

$

4,529,924

Market

Revenue Multiple(a)

6.25x

—

Preferred Stocks(b)

5,843,081

Market

Revenue Multiple(a)

6.50x – 14.25x

10.15x

$

10,373,005

 

(a)

Increase in unobservable input may result in a significant increase to value, while an decrease in unobservable input may result in a significant decrease to value.

(b)

For the year ended December 31, 2018, the valuation technique for investments classified as preferred stocks amounting to $3,090,473 changed to Current Value. The investments were previously valued utilizing Transaction Price. The change was due to consideration of the information that was available at the time the investments were valued.

See notes to financial statements.

 

 

58		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments   December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY) (Percentages shown are based on Net Assets)

 

 

 

SCHEDULES OF INVESTMENTS			59

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY)

 

(g)	During the year ended December 31, 2018, 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 Held at 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class					5,073,700				20,416,243				25,489,943			$	25,489,943			$	103,479			$	—			$	—

 

(a)

Includes net capital gain distributions, if applicable.

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call 3M Co.			114				01/04/19			USD			202.50			USD			2,172			$	(912	)
Rogers Communications, Inc., Class B			818				01/04/19			CAD			71.50			CAD			5,723				(8,388	)
3M Co.			97				01/11/19			USD			210.00			USD			1,848				(1,067	)
Microsoft Corp.			95				01/11/19			USD			112.00			USD			965				(1,140	)
Microsoft Corp.			184				01/18/19			USD			110.00			USD			1,869				(8,648	)
Rogers Communications, Inc., Class B			722				01/18/19			CAD			70.00			CAD			5,051				(58,968	)
Rogers Communications, Inc., Class B			476				01/18/19			CAD			72.00			CAD			3,330				(12,726	)
3M Co.			114				01/25/19			USD			205.00			USD			2,172				(10,089	)
Microsoft Corp.			127				01/25/19			USD			113.00			USD			1,290				(5,905	)
Microsoft Corp.			92				01/25/19			USD			106.00			USD			934				(19,136	)
3M Co.			134				02/01/19			USD			202.50			USD			2,553				(28,073	)
Microsoft Corp.			92				02/01/19			USD			106.00			USD			934				(23,966	)
Rogers Communications, Inc., Class B			183				02/15/19			CAD			72.00			CAD			1,280				(13,673	)
TELUS Corp.			571				02/15/19			CAD			48.00			CAD			2,584				(8,783	)
																						$	(201,474	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
ANTA Sports Products Ltd.		Morgan Stanley & Co. International PLC			150,000				01/03/19			HKD			35.93			HKD			5,624			$	(35,292	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			185,000				01/03/19			AUD			13.83			AUD			2,453				(8	)
DBS Group Holdings Ltd.		UBS AG			60,000				01/03/19			SGD			23.88			SGD			1,422				(7,383	)
Diageo PLC		Morgan Stanley & Co. International PLC			77,800				01/03/19			GBP			27.80			GBP			2,182				(40,003	)
Heineken NV		Morgan Stanley & Co. International PLC			45,000				01/03/19			EUR			82.09			EUR			3,471				(550	)
Kone OYJ, Class B		Citibank N.A.			23,600				01/03/19			EUR			45.50			EUR			983				(3	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			40,000				01/03/19			EUR			34.41			EUR			1,224				(102	)
Novo Nordisk A/S, Class B		Morgan Stanley & Co. International PLC			41,000				01/03/19			DKK			303.49			DKK			12,270				(11,317	)
Sonic Healthcare Ltd.		Morgan Stanley & Co. International PLC			52,000				01/03/19			AUD			22.38			AUD			1,152				(5,567	)
TELUS Corp.		Credit Suisse International			31,200				01/03/19			CAD			46.84			CAD			1,412				(4	)
AstraZeneca PLC		Goldman Sachs International			16,200				01/04/19			GBP			60.02			GBP			949				(5,067	)
GlaxoSmithKline PLC		Goldman Sachs International			34,800				01/04/19			GBP			15.42			GBP			520				(2,271	)
Imperial Brands PLC		Barclays Bank PLC			92,000				01/04/19			GBP			27.70			GBP			2,191				(117	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			67,300				01/04/19			CHF			85.93			CHF			5,369				(385	)
Schneider Electric SE		Barclays Bank PLC			21,100				01/04/19			EUR			65.58			EUR			1,249				(5	)
Unilever PLC		Goldman Sachs International			72,000				01/04/19			GBP			41.94			GBP			2,966				(12,134	)
Rogers Communications, Inc., Class B		Citibank N.A.			26,000				01/07/19			CAD			68.72			CAD			1,819				(29,324	)
Deutsche Post AG, Registered Shares		Citibank N.A.			100,000				01/08/19			EUR			29.42			EUR			2,384				(170	)
Diageo PLC		Credit Suisse International			33,700				01/08/19			GBP			27.56			GBP			945				(26,920	)
Sanofi		Morgan Stanley & Co. International PLC			32,000				01/08/19			EUR			80.59			EUR			2,423				(2,369	)
Svenska Handelsbanken AB		Barclays Bank PLC			210,800				01/08/19			SEK			100.1			SEK			20,787				(17,781	)
Amcor Ltd.		UBS AG			318,000				01/09/19			AUD			13.33			AUD			4,217				(27,613	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			52,600				01/09/19			AUD			23.55			AUD			1,160				(932	)

 

 

60		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Kone OYJ, Class B		UBS AG			65,150				01/09/19			EUR			43.84			EUR			2,715			$	(5,293	)
Novartis AG, Registered Shares		UBS AG			63,500				01/09/19			CHF			90.35			CHF			5,345				(3,155	)
RELX PLC		Goldman Sachs International			69,000				01/09/19			EUR			19.20			EUR			1,239				(805	)
British American Tobacco PLC		UBS AG			113,500				01/10/19			GBP			28.14			GBP			2,833				(12,460	)
SGS SA, Registered Shares		Goldman Sachs International			1,500				01/10/19			CHF			2,381.58			CHF			3,319				(1,889	)
SGS SA, Registered Shares		UBS AG			500				01/10/19			CHF			2,315.33			CHF			1,106				(3,044	)
Sonic Healthcare Ltd.		Citibank N.A.			89,000				01/10/19			AUD			22.99			AUD			1,971				(5,571	)
Taiwan Semiconductor Manufacturing Co. Ltd.		JPMorgan Chase Bank N.A.			235,000				01/10/19			USD			225.12			USD			52,450				(35,696	)
TELUS Corp.		Citibank N.A.			33,500				01/11/19			CAD			46.93			CAD			1,516				(556	)
TELUS Corp.		Royal Bank of Canada			16,300				01/11/19			CAD			48.03			CAD			738				(251	)
ANTA Sports Products Ltd.		Morgan Stanley & Co. International PLC			468,000				01/15/19			HKD			36.62			HKD			17,545				(120,574	)
Deutsche Post AG, Registered Shares		Citibank N.A.			100,000				01/15/19			EUR			29.42			EUR			2,384				—
Diageo PLC		Credit Suisse International			33,700				01/15/19			GBP			27.56			GBP			945				(34,027	)
Heineken NV		Morgan Stanley & Co. International PLC			22,300				01/15/19			EUR			79.37			EUR			1,720				(11,698	)
TELUS Corp.		Royal Bank of Canada			20,000				01/15/19			CAD			47.75			CAD			905				(1,001	)
United Overseas Bank Ltd.		Morgan Stanley & Co. International PLC			117,300				01/15/19			SGD			24.59			SGD			2,893				(39,598	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			185,000				01/16/19			AUD			13.90			AUD			2,453				(2,406	)
Ansell Ltd.		UBS AG			91,800				01/16/19			AUD			23.96			AUD			2,025				(2,099	)
DBS Group Holdings Ltd.		JPMorgan Chase Bank N.A.			71,800				01/16/19			SGD			24.33			SGD			1,702				(9,776	)
DBS Group Holdings Ltd.		UBS AG			60,000				01/16/19			SGD			23.88			SGD			1,422				(15,105	)
Imperial Brands PLC		Barclays Bank PLC			92,000				01/16/19			GBP			27.70			GBP			2,191				(8,025	)
Japan Tobacco, Inc.		JPMorgan Chase Bank N.A.			51,700				01/16/19			JPY			2,926.73			JPY			134,644				(234	)
Kone OYJ, Class B		Goldman Sachs International			52,000				01/16/19			EUR			45.37			EUR			2,167				(2,244	)
Koninklijke Philips NV		Morgan Stanley & Co. International PLC			40,000				01/16/19			EUR			34.60			EUR			1,224				(868	)
Novartis AG, Registered Shares		UBS AG			63,500				01/16/19			CHF			90.35			CHF			5,345				(10,470	)
RELX PLC		Credit Suisse International			93,100				01/16/19			EUR			18.29			EUR			1,672				(22,706	)
Sonic Healthcare Ltd.		Morgan Stanley & Co. International PLC			52,000				01/16/19			AUD			22.49			AUD			1,152				(10,854	)
BAE Systems PLC		Goldman Sachs International			159,000				01/17/19			GBP			5.00			GBP			730				(3,289	)
Sanofi		Morgan Stanley & Co. International PLC			32,000				01/17/19			EUR			80.59			EUR			2,423				(8,163	)
Schneider Electric SE		Goldman Sachs International			21,100				01/17/19			EUR			65.6			EUR			1,249				(1,293	)
Svenska Handelsbanken AB		Goldman Sachs International			210,800				01/17/19			SEK			100.13			SEK			20,787				(27,690	)
TELUS Corp.		Royal Bank of Canada			62,300				01/18/19			CAD			47.00			CAD			2,819				(5,932	)
Amcor Ltd.		UBS AG			247,700				01/23/19			AUD			13.38			AUD			3,285				(31,746	)
Diageo PLC		Credit Suisse International			20,600				01/23/19			GBP			28.37			GBP			578				(10,707	)
Kone OYJ, Class B		Credit Suisse International			55,900				01/23/19			EUR			42.90			EUR			2,329				(34,121	)
Svenska Handelsbanken AB		Credit Suisse International			240,500				01/23/19			SEK			99.34			SEK			23,716				(47,032	)
TELUS Corp.		Royal Bank of Canada			33,300				01/23/19			CAD			46.75			CAD			1,507				(3,117	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			494,000				01/23/19			USD			228.01			USD			110,256				(91,943	)
ANTA Sports Products Ltd.		Goldman Sachs International			404,000				01/24/19			HKD			38.81			HKD			15,146				(69,674	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			32,100				01/24/19			AUD			23.19			AUD			708				(4,069	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			25,900				01/24/19			AUD			23.40			AUD			571				(2,448	)
AstraZeneca PLC		UBS AG			8,000				01/24/19			GBP			63.35			GBP			468				(1,980	)
BAE Systems PLC		Goldman Sachs International			159,000				01/24/19			GBP			5.00			GBP			730				(5,729	)
British American Tobacco PLC		Goldman Sachs International			64,700				01/24/19			GBP			28.30			GBP			1,615				(9,010	)
Deutsche Post AG, Registered Shares		UBS AG			89,600				01/24/19			EUR			28.55			EUR			2,136				(5,881	)
Koninklijke Philips NV		Goldman Sachs International			82,000				01/24/19			EUR			33.62			EUR			2,509				(8,153	)
Novo Nordisk A/S, Class B		Goldman Sachs International			41,000				01/24/19			DKK			307.22			DKK			12,270				(26,661	)
Sonic Healthcare Ltd.		UBS AG			120,600				01/24/19			AUD			21.83			AUD			2,671				(61,026	)
Unilever PLC		Credit Suisse International			59,400				01/24/19			GBP			43.23			GBP			2,447				(19,309	)
TELUS Corp.		Royal Bank of Canada			42,100				01/25/19			CAD			48.00			CAD			1,905				(4,347	)
Diageo PLC		Credit Suisse International			20,600				01/29/19			GBP			28.37			GBP			578				(12,274	)
GlaxoSmithKline PLC		Deutsche Bank AG			260,300				01/29/19			GBP			14.67			GBP			3,891				(212,378	)
Kone OYJ, Class B		UBS AG			34,600				01/29/19			EUR			44.04			EUR			1,442				(14,239	)
Nestle SA, Registered Shares		Deutsche Bank AG			45,600				01/29/19			CHF			83.97			CHF			3,638				(16,194	)
Novo Nordisk A/S, Class B		Goldman Sachs International			17,100				01/29/19			DKK			301.92			DKK			5,118				(21,597	)
Sonic Healthcare Ltd.		UBS AG			75,800				01/29/19			AUD			21.63			AUD			1,679				(48,791	)
Amcor Ltd.		UBS AG			248,500				01/30/19			AUD			13.32			AUD			3,295				(43,497	)
Ansell Ltd.		UBS AG			43,400				01/30/19			AUD			23.64			AUD			957				(6,613	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			316,000				01/30/19			GBP			4.68			GBP			1,450				(41,199	)
Imperial Brands PLC		UBS AG			125,600				01/30/19			GBP			26.37			GBP			2,991				(58,884	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			494,000				01/30/19			USD			228.01			USD			110,256				(107,593	)
British American Tobacco PLC		Goldman Sachs International			64,700				01/31/19			GBP			28.30			GBP			1,615				(14,427	)

 

 

SCHEDULES OF INVESTMENTS			61

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call (continued)
Diageo PLC		UBS AG			32,600				01/31/19				GBP				28.96				GBP				914			$	(10,284	)
Imperial Brands PLC		Credit Suisse International			45,000				01/31/19				GBP				24.55				GBP				1,071				(22,186	)
Rogers Communications, Inc., Class B		Citibank N.A.			18,200				01/31/19				CAD				69.94				CAD				1,273				(16,742	)
Sanofi		Goldman Sachs International			6,200				01/31/19				EUR				80.20				EUR				469				(3,331	)
Suncor Energy, Inc.		UBS AG			18,500				01/31/19				EUR				62.83				EUR				1,095				(13,528	)
TELUS Corp.		Royal Bank of Canada			57,100				01/31/19				CAD				47.75				CAD				2,584				(2,534	)
TELUS Corp.		Royal Bank of Canada			33,400				02/01/19				CAD				46.75				CAD				1,511				(5,023	)
DBS Group Holdings Ltd.		BNP Paribas S.A.			61,000				02/04/19				SGD				23.77				SGD				1,446				(26,788	)
TELUS Corp.		Goldman Sachs International			35,600				02/04/19				CAD				46.65				CAD				1,611				(6,459	)
United Overseas Bank Ltd.		Morgan Stanley & Co. International PLC			111,000				02/04/19				SGD				24.54				SGD				2,737				(56,691	)
Japan Tobacco, Inc.		JPMorgan Chase Bank N.A.			44,000				02/05/19				JPY				2,877.38				JPY				114,591				(4,153	)
Amcor Ltd.		Morgan Stanley & Co. International PLC			248,500				02/06/19				AUD				13.32				AUD				3,295				(48,633	)
Ansell Ltd.		Morgan Stanley & Co. International PLC			43,400				02/06/19				AUD				23.64				AUD				957				(8,319	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			230,400				02/06/19				GBP				4.79				GBP				1,058				(21,353	)
Diageo PLC		UBS AG			5,000				02/06/19				GBP				27.94				GBP				140				(4,510	)
Kone OYJ, Class B		Credit Suisse International			65,150				02/06/19				EUR				43.05				EUR				2,715				(51,992	)
Nestle SA, Registered Shares		Morgan Stanley & Co. International PLC			57,100				02/06/19				CHF				82.55				CHF				4,555				(45,233	)
Novartis AG, Registered Shares		Credit Suisse International			53,400				02/06/19				CHF				90.48				CHF				4,495				(18,224	)
RELX PLC		Credit Suisse International			69,000				02/06/19				EUR				18.14				EUR				1,239				(32,473	)
Sanofi		Credit Suisse International			71,300				02/06/19				EUR				77.09				EUR				5,398				(117,787	)
Suncor Energy, Inc.		Morgan Stanley & Co. International PLC			25,700				02/06/19				EUR				62.16				EUR				1,521				(28,520	)
TELUS Corp.		Royal Bank of Canada			35,700				02/06/19				CAD				46.62				CAD				1,615				(7,011	)
Rogers Communications, Inc., Class B		Credit Suisse International			36,500				02/11/19				CAD				71.72				CAD				2,554				(24,770	)
BAE Systems PLC		UBS AG			228,500				02/12/19				GBP				4.71				GBP				1,049				(35,512	)
GlaxoSmithKline PLC		Goldman Sachs International			286,000				02/12/19				GBP				15.48				GBP				4,276				(126,952	)
Novo Nordisk A/S, Class B		Goldman Sachs International			22,400				02/12/19				DKK				305.65				DKK				6,704				(29,380	)
ANTA Sports Products Ltd.		Goldman Sachs International			404,000				02/13/19				HKD				38.81				HKD				15,146				(103,494	)
Suncor Energy, Inc.		UBS AG			37,100				02/13/19				EUR				59.53				EUR				2,196				(87,152	)
Unilever PLC		Credit Suisse International			59,400				02/13/19				GBP				43.23				GBP				2,447				(28,685	)
Unilever PLC		Morgan Stanley & Co. International PLC			69,000				02/13/19				GBP				44.49				GBP				2,842				(25,939	)
BAE Systems PLC		UBS AG			228,500				02/19/19				GBP				4.71				GBP				1,049				(39,427	)
Japan Tobacco, Inc.		UBS AG			51,700				02/20/19				JPY				2,870.69				JPY				134,644				(8,862	)
BAE Systems PLC		Morgan Stanley & Co. International PLC			316,000				02/26/19				GBP				4.68				GBP				1,450				(61,502	)
																												$	(2,790,177	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	3,213,242			$	(315,083	)		$	(2,991,651	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Liabilities — Derivative Financial Instrument
Options written
Options written at value		$	—			$	—			$	2,991,651			$	—			$	—			$	—			$	2,991,651

 

 

62		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY)

 

For the year ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options written		$	—			$	—			$	2,536,527			$	—			$	—			$	—			$	2,536,527

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Change in Unrealized Appreciation (Depreciation) on:
Options written		$	—			$	—			$	1,313,824			$	—			$	—			$	—			$	1,313,824

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts written		$	4,719,654

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Options		$	—			$	2,991,651
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			—				(201,474	)
Total derivative assets and liabilities subject to an MNA		$	—			$	2,790,177

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged (a)				Net Amount of Derivative Liabilities  (b)
Barclays Bank PLC		$	25,928			$	—			$	—			$	—			$	25,928
BNP Paribas S.A.			26,788				—				—				—				26,788
Citibank N.A.			52,366				—				—				—				52,366
Credit Suisse International			503,217				—				(503,217	)			—				—
Deutsche Bank AG			228,572				—				—				—				228,572
Goldman Sachs International			481,549				—				(481,549	)			—				—
JPMorgan Chase Bank N.A.			49,859				—				(49,859	)			—				—
Morgan Stanley & Co. International PLC			634,592				—				(634,592	)			—				—
Royal Bank of Canada			29,216				—				—				—				29,216
UBS AG			758,090				—				(708,237	)			(49,853	)			—
		$	2,790,177			$	—			$	(2,377,454	)		$	(49,853	)		$	362,870

 

(a)

Excess of collateral received from the individual counterparty is not shown for financial reporting purposes.

(b)

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

 

 

SCHEDULES OF INVESTMENTS			63

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Schedule of Investments  (continued) December 31, 2018		BlackRock Enhanced International Dividend Trust (BGY)

 

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Australia		$	—			$	56,023,764			$	—			$	56,023,764
Canada			65,363,685				—				—				65,363,685
China			—				11,382,422				—				11,382,422
Denmark			—				12,397,002				—				12,397,002
Finland			—				31,445,516				—				31,445,516
France			—				35,204,103				—				35,204,103
Germany			—				24,074,680				—				24,074,680
India			—				11,493,426				—				11,493,426
Japan			—				10,010,543				—				10,010,543
Netherlands			—				25,405,750				—				25,405,750
Singapore			—				18,941,379				—				18,941,379
Sweden			—				16,369,462				—				16,369,462
Switzerland			—				58,526,209				—				58,526,209
Taiwan			—				19,757,804				—				19,757,804
United Kingdom			—				164,077,106				—				164,077,106
United States			29,434,838				—				—				29,434,838
Preferred Stock			—				—				4,520,055				4,520,055
Short-Term Securities			25,489,943				—				—				25,489,943
		$	120,288,466			$	495,109,166			$	4,520,055			$	619,917,687
Derivative Financial Instruments(a)
Liabilities:
Equity contracts		$	(201,474	)		$	(2,790,177	)		$	—			$	(2,991,651	)

 

(a)

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

Transfers between Level 1 and Level 2 were as follows:

 

		Transfers out of Level 1 (a)				Transfers Into Level 2 (a)
Assets:
Long-Term Investments:
Common Stocks		$	10,130,192			$	10,130,192

 

(a)

External pricing service used to reflect any significant market movements between the time the Trust valued such foreign securities and the earlier closing of foreign markets.

See notes to financial statements.

 

 

64		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments December 31, 2018		BlackRock Health Sciences Trust (BME) (Percentages shown are based on Net Assets)

 

 

 

SCHEDULES OF INVESTMENTS			65

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Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME) (Percentages shown are based on Net Assets)

 

(j)	During the year ended December 31, 2018, investments in issuers considered to be affiliates 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 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class					14,301,421				11,666,099				25,967,520			$	25,967,520			$	215,966			$	—			$	—
SL Liquidity Series, LLC, Money Market Series					120,903				(116,238	)			4,665				4,665				1,757	(b)			1				7
																$	25,972,185			$	217,723			$	1			$	7

 

(a)

Includes net capital gain distributions, if applicable.

(b)

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

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description

Number of Contracts

Expiration Date

Exercise Price

Notional Amount (000)

Value

Call

Teva Pharmaceutical Industries Ltd. — ADR

50

01/04/19

USD

21.00

USD

77

$

250

 

 

66		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME)

 

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Abbott Laboratories			223				01/04/19			USD			74.00			USD			1,613			$	(4,683	)
Allergan PLC			71				01/04/19			USD			160.00			USD			949				(3,550	)
Amgen, Inc.			72				01/04/19			USD			205.00			USD			1,402				(792	)
Baxter International, Inc.			61				01/04/19			USD			68.50			USD			402				(1,342	)
Biogen, Inc.			27				01/04/19			USD			337.50			USD			812				(5,805	)
Bristol-Myers Squibb Co.			170				01/04/19			USD			54.00			USD			884				(1,530	)
Edwards Lifesciences Corp.			59				01/04/19			USD			170.00			USD			904				(1,770	)
Humana, Inc.			21				01/04/19			USD			342.50			USD			602				(315	)
Medtronic PLC			159				01/04/19			USD			95.00			USD			1,446				(1,272	)
Pfizer, Inc.			365				01/04/19			USD			43.50			USD			1,593				(19,163	)
Pfizer, Inc.			91				01/04/19			USD			44.50			USD			397				(1,547	)
Pfizer, Inc.			92				01/04/19			USD			46.50			USD			402				(368	)
Pfizer, Inc.			124				01/04/19			USD			45.00			USD			541				(868	)
Teva Pharmaceutical Industries Ltd. — ADR			152				01/04/19			USD			23.50			USD			234				(304	)
Vertex Pharmaceuticals, Inc.			82				01/04/19			USD			185.00			USD			1,359				(1,640	)
Zoetis, Inc.			74				01/04/19			USD			95.00			USD			633				(2,590	)
Abbott Laboratories			95				01/11/19			USD			72.50			USD			687				(12,350	)
Abbott Laboratories			95				01/11/19			USD			74.00			USD			687				(6,650	)
Alexion Pharmaceuticals, Inc.			55				01/11/19			USD			120.00			USD			535				(2,200	)
Allergan PLC			71				01/11/19			USD			160.00			USD			949				(994	)
Amgen, Inc.			17				01/11/19			USD			205.00			USD			331				(1,555	)
AstraZeneca PLC			28				01/11/19			USD			39.50			USD			106				(560	)
Becton Dickinson & Co.			73				01/11/19			USD			252.50			USD			1,645				(4,745	)
Biogen, Inc.			20				01/11/19			USD			327.50			USD			602				(2,750	)
Bristol-Myers Squibb Co.			149				01/11/19			USD			55.00			USD			775				(2,756	)
Cigna Corp.			40				01/11/19			USD			217.50			USD			760				(2,120	)
Eli Lilly & Co.			130				01/11/19			USD			119.00			USD			1,504				(10,335	)
Gilead Sciences, Inc.			16				01/11/19			USD			72.00			USD			100				(96	)
Medtronic PLC			123				01/11/19			USD			97.00			USD			1,119				(1,414	)
Pfizer, Inc.			91				01/11/19			USD			46.50			USD			397				(819	)
Pfizer, Inc.			123				01/11/19			USD			45.00			USD			537				(2,952	)
QIAGEN NV			195				01/11/19			USD			35.75			USD			6,718				(3,230	)
Regeneron Pharmaceuticals, Inc.			16				01/11/19			USD			372.50			USD			598				(18,320	)
Service Corp. International			53				01/11/19			USD			44.56			USD			213				(40	)
Abbott Laboratories			221				01/18/19			USD			75.00			USD			1,598				(13,702	)
Acceleron Pharma, Inc.			166				01/18/19			USD			50.00			USD			723				(12,450	)
Agilent Technologies, Inc.			50				01/18/19			USD			75.00			USD			337				(400	)
Agios Pharmaceuticals, Inc.			31				01/18/19			USD			75.00			USD			143				(1,240	)
Align Technology, Inc.			16				01/18/19			USD			240.00			USD			335				(2,160	)
Amedisys, Inc.			99				01/18/19			USD			125.00			USD			1,159				(23,117	)
Amgen, Inc.			17				01/18/19			USD			200.00			USD			331				(5,074	)
Amicus Therapeutics, Inc.			89				01/18/19			USD			10.00			USD			85				(3,560	)
Arena Pharmaceuticals, Inc.			100				01/18/19			USD			46.00			USD			390				(2,850	)
Assembly Biosciences, Inc.			10				01/18/19			USD			20.00			USD			23				(2,050	)
Baxter International, Inc.			16				01/18/19			USD			65.40			USD			105				(2,772	)
BioMarin Pharmaceutical, Inc.			65				01/18/19			USD			110.00			USD			553				(650	)
Biogen, Inc.			8				01/18/19			USD			340.00			USD			241				(540	)
Biohaven Pharmaceutical Holding Co. Ltd.			28				01/18/19			USD			35.00			USD			104				(10,080	)
Blueprint Medicines Corp.			7				01/18/19			USD			60.00			USD			38				(1,242	)
Blueprint Medicines Corp.			7				01/18/19			USD			50.00			USD			38				(4,095	)
Bristol-Myers Squibb Co.			223				01/18/19			USD			55.00			USD			1,159				(7,359	)
Centene Corp.			89				01/18/19			USD			135.00			USD			1,026				(445	)
Cigna Corp.			41				01/18/19			USD			200.00			USD			779				(7,995	)
DaVita, Inc.			43				01/18/19			USD			55.00			USD			221				(3,117	)
DaVita, Inc.			43				01/18/19			USD			70.00			USD			221				(860	)
Edwards Lifesciences Corp.			39				01/18/19			USD			160.00			USD			597				(8,580	)
Elanco Animal Health, Inc.			43				01/18/19			USD			35.00			USD			136				(1,505	)
Eli Lilly & Co.			135				01/18/19			USD			120.00			USD			1,562				(15,660	)
Exact Science Corp.			40				01/18/19			USD			75.00			USD			252				(2,500	)
Galapagos NV — ADR			22				01/18/19			USD			95.00			USD			202				(8,415	)
HCA Healthcare, Inc.			31				01/18/19			USD			145.00			USD			386				(930	)
Halozyme Therapeutics, Inc.			100				01/18/19			USD			15.00			USD			146				(5,250	)

 

 

SCHEDULES OF INVESTMENTS			67

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
HealthEquity, Inc.			49				01/18/19			USD			65.00			USD			292			$	(4,900	)
Humana, Inc.			68				01/18/19			USD			320.00			USD			1,948				(6,800	)
IQVIA Holdings, Inc.			21				01/18/19			USD			130.00			USD			244				(1,155	)
Illumina, Inc.			10				01/18/19			USD			330.00			USD			300				(3,750	)
Incyte Corp.			137				01/18/19			USD			65.00			USD			871				(25,688	)
Insmed, Inc.			99				01/18/19			USD			20.00			USD			130				(1,980	)
Intuitive Surgical, Inc.			44				01/18/19			USD			535.00			USD			2,107				(6,930	)
Masimo Corp.			78				01/18/19			USD			110.00			USD			837				(13,845	)
Medicines Co.			38				01/18/19			USD			23.00			USD			73				(665	)
Medicines Co.			37				01/18/19			USD			20.00			USD			71				(3,330	)
Merck & Co., Inc.			148				01/18/19			USD			77.50			USD			1,131				(13,764	)
Nektar Therapeutics			29				01/18/19			USD			43.00			USD			95				(1,160	)
Nevro Corp.			25				01/18/19			USD			50.00			USD			97				(500	)
Novartis AG — ADR			70				01/18/19			USD			90.00			USD			601				(1,925	)
Novo Nordisk A/S — ADR			94				01/18/19			USD			45.00			USD			433				(16,450	)
Pfizer, Inc.			279				01/18/19			USD			44.00			USD			1,218				(23,018	)
Pfizer, Inc.			91				01/18/19			USD			45.00			USD			397				(3,776	)
Quest Diagnostics, Inc.			77				01/18/19			USD			100.00			USD			641				(385	)
Quest Diagnostics, Inc.			63				01/18/19			USD			90.00			USD			525				(1,260	)
Reata Pharmaceuticals, Inc.			18				01/18/19			USD			70.00			USD			101				(675	)
ResMed, Inc.			135				01/18/19			USD			110.00			USD			1,537				(71,550	)
Sanofi			83				01/18/19			USD			45.00			USD			360				(2,490	)
Sanofi			83				01/18/19			USD			44.00			USD			360				(5,602	)
Sarepta Therapeutics, Inc.			78				01/18/19			USD			120.00			USD			851				(29,445	)
Seattle Genetics, Inc.			102				01/18/19			USD			60.00			USD			578				(10,710	)
Spark Therapeutics, Inc.			36				01/18/19			USD			40.00			USD			141				(6,210	)
Stryker Corp.			244				01/18/19			USD			170.00			USD			3,825				(7,930	)
Teladoc, Inc.			74				01/18/19			USD			70.00			USD			367				(925	)
Teleflex, Inc.			17				01/18/19			USD			270.00			USD			439				(3,825	)
Thermo Fisher Scientific, Inc.			55				01/18/19			USD			230.00			USD			1,231				(15,538	)
Ultragenyx Pharmaceutical, Inc.			70				01/18/19			USD			45.00			USD			304				(14,000	)
Vertex Pharmaceuticals, Inc.			69				01/18/19			USD			170.00			USD			1,143				(32,775	)
WellCare Health Plans, Inc.			14				01/18/19			USD			260.00			USD			331				(1,820	)
Zimmer Biomet Holdings, Inc.			24				01/18/19			USD			120.00			USD			249				(240	)
Zimmer Biomet Holdings, Inc.			16				01/18/19			USD			105.00			USD			166				(3,240	)
Zoetis, Inc.			74				01/18/19			USD			97.50			USD			633				(1,110	)
ACADIA Pharmaceuticals, Inc.			149				01/25/19			USD			16.00			USD			241				(30,173	)
Abbott Laboratories			95				01/25/19			USD			73.00			USD			687				(16,435	)
AmerisourceBergen Corp.			58				01/25/19			USD			84.00			USD			432				(1,885	)
Amgen, Inc.			7				01/25/19			USD			190.00			USD			136				(6,370	)
AstraZeneca PLC			126				01/25/19			USD			39.50			USD			479				(5,355	)
Baxter International, Inc.			44				01/25/19			USD			66.00			USD			290				(8,228	)
Biogen, Inc.			19				01/25/19			USD			330.00			USD			572				(3,420	)
Biogen, Inc.			8				01/25/19			USD			307.50			USD			241				(6,280	)
Bristol-Myers Squibb Co.			73				01/25/19			USD			52.00			USD			379				(10,731	)
Cigna Corp.			39				01/25/19			USD			212.50			USD			741				(3,783	)
Gilead Sciences, Inc.			51				01/25/19			USD			73.00			USD			319				(612	)
Gilead Sciences, Inc.			64				01/25/19			USD			69.00			USD			400				(2,304	)
HCA Holdings, Inc.			55				01/25/19			USD			131.00			USD			684				(8,112	)
Humana, Inc.			22				01/25/19			USD			312.50			USD			630				(2,970	)
Illumina, Inc.			11				01/25/19			USD			330.00			USD			330				(5,390	)
Medtronic PLC			160				01/25/19			USD			95.50			USD			1,455				(11,280	)
Merck & Co., Inc.			137				01/25/19			USD			79.50			USD			1,047				(7,192	)
Pfizer, Inc.			168				01/25/19			USD			45.00			USD			733				(9,408	)
Pfizer, Inc.			168				01/25/19			USD			44.50			USD			733				(12,516	)
Pfizer, Inc.			183				01/25/19			USD			44.00			USD			799				(17,843	)
Regeneron Pharmaceuticals, Inc.			11				01/25/19			USD			365.00			USD			411				(21,890	)
Sarepta Therapeutics, Inc.			56				01/25/19			USD			117.00			USD			611				(29,400	)
Zoetis, Inc.			70				01/25/19			USD			87.50			USD			599				(11,550	)
Novo Nordisk A/S — ADR			103				01/28/19			USD			45.90			USD			475				(15,137	)
Pfizer, Inc.			83				01/28/19			USD			45.10			USD			362				(5,107	)
Novartis AG — ADR			6				01/29/19			USD			84.73			USD			51				(1,552	)

 

 

68		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Merck & Co., Inc.			165				01/30/19			USD			79.90			USD			1,261			$	(10,731	)
Teleflex, Inc.			17				01/31/19			USD			255.00			USD			439				(19,730	)
Abbott Laboratories			95				02/01/19			USD			70.00			USD			687				(35,388	)
Alexion Pharmaceuticals, Inc.			15				02/01/19			USD			98.00			USD			146				(7,650	)
Becton Dickinson & Co.			25				02/01/19			USD			235.00			USD			563				(7,812	)
Cigna Corp.			41				02/01/19			USD			200.00			USD			779				(16,708	)
Gilead Sciences, Inc.			277				02/01/19			USD			70.00			USD			1,733				(11,496	)
Gilead Sciences, Inc.			63				02/01/19			USD			70.50			USD			394				(2,079	)
Intercept Pharmaceuticals, Inc.			8				02/01/19			USD			98.50			USD			81				(9,040	)
McKesson Corp.			29				02/01/19			USD			125.00			USD			320				(2,102	)
Medtronic PLC			114				02/01/19			USD			93.00			USD			1,037				(19,551	)
Pfizer, Inc.			61				02/01/19			USD			44.00			USD			266				(6,740	)
WellCare Health Plans, Inc.			12				02/04/19			USD			244.53			USD			283				(8,867	)
Novartis AG — ADR			7				02/07/19			USD			84.73			USD			60				(2,021	)
WellCare Health Plans, Inc.			12				02/07/19			USD			244.53			USD			283				(9,436	)
Biohaven Pharmaceutical Holding Co. Ltd.			28				02/08/19			USD			33.36			USD			104				(16,153	)
Exact Science Corp.			19				02/08/19			USD			65.00			USD			120				(8,740	)
Merck & Co., Inc.			165				02/08/19			USD			79.90			USD			1,261				(13,696	)
Pfizer, Inc.			46				02/08/19			USD			42.66			USD			201				(8,050	)
Novartis AG — ADR			6				02/13/19			USD			84.73			USD			51				(1,842	)
Abbott Laboratories			223				02/15/19			USD			75.00			USD			1,613				(34,788	)
Agilent Technologies, Inc.			50				02/15/19			USD			75.00			USD			337				(2,825	)
Agilent Technologies, Inc.			16				02/15/19			USD			70.00			USD			108				(3,048	)
Agios Pharmaceuticals, Inc.			32				02/15/19			USD			60.00			USD			148				(2,080	)
Align Technology, Inc.			7				02/15/19			USD			220.00			USD			147				(8,820	)
AmerisourceBergen Corp.			33				02/15/19			USD			77.50			USD			246				(8,745	)
AnaptysBio, Inc.			8				02/15/19			USD			60.00			USD			51				(6,760	)
Assembly Biosciences, Inc.			10				02/15/19			USD			20.00			USD			23				(3,850	)
Baxter International, Inc.			105				02/15/19			USD			70.00			USD			691				(10,448	)
BioMarin Pharmaceutical, Inc.			65				02/15/19			USD			95.00			USD			553				(18,363	)
Charles River Laboratories International, Inc.			37				02/15/19			USD			120.00			USD			419				(11,655	)
IQVIA Holdings, Inc.			20				02/15/19			USD			120.00			USD			232				(6,750	)
LHC Group, Inc.			30				02/15/19			USD			100.00			USD			282				(8,100	)
Merck & Co., Inc.			54				02/15/19			USD			80.00			USD			413				(5,238	)
Nevro Corp.			26				02/15/19			USD			40.00			USD			101				(7,670	)
Reata Pharmaceuticals, Inc.			19				02/15/19			USD			55.00			USD			107				(11,875	)
Service Corp. International			54				02/15/19			USD			40.00			USD			217				(9,585	)
Teladoc, Inc.			60				02/15/19			USD			50.00			USD			297				(27,000	)
Teva Pharmaceutical Industries Ltd. — ADR			134				02/15/19			USD			16.00			USD			207				(12,529	)
Thermo Fisher Scientific, Inc.			55				02/15/19			USD			230.00			USD			1,231				(36,300	)
Novo Nordisk A/S — ADR			117				03/15/19			USD			46.00			USD			539				(26,033	)
Service Corp. International			93				03/15/19			USD			45.00			USD			374				(4,882	)
																						$	(1,349,488	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call
ConvaTec Group PLC		UBS AG			185,000				01/03/19				GBP				1.71				GBP				257			$	(19	)
AstraZeneca PLC		Goldman Sachs International			28,100				01/04/19				GBP				60.02				GBP				1,650				(8,789	)
Chugai Pharmaceutical Co. Ltd.		Goldman Sachs International			6,400				01/04/19				JPY				7,173.02				JPY				40,832				(38	)
Seattle Genetics, Inc.		Goldman Sachs International			10,100				01/08/19				USD				66.92				USD				572				(327	)
Merck & Co., Inc.		Morgan Stanley & Co. International PLC			5,700				01/24/19				EUR				100.55				EUR				512				(1,043	)
Insmed, Inc.		Barclays Bank PLC			9,900				01/25/19				USD				14.09				USD				130				(7,849	)
Masimo Corp.		Citibank N.A.			7,800				01/30/19				USD				108.42				USD				837				(26,697	)
Sanofi		Credit Suisse International			8,200				02/06/19				EUR				77.09				EUR				620				(13,546	)
Centene Corp.		Credit Suisse International			8,900				02/12/19				USD				136.89				USD				1,026				(6,353	)
Merck & Co., Inc.		Credit Suisse International			5,600				02/26/19				EUR				99.94				EUR				503				(4,508	)
																												$	(69,169	)

 

 

SCHEDULES OF INVESTMENTS			69

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME)

 

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	1,390,153			$	(273,171	)		$	(1,418,657	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	250			$	—			$	—			$	—			$	250

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	1,418,657			$	—			$	—			$	—			$	1,418,657

For the period ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(4,882	)		$				$	—			$	—			$	(4,882	)
Options written			—				—				(4,052,692	)							—				—				(4,052,692	)
		$	—			$	—			$	(4,057,574	)		$				$	—			$	—			$	(4,057,574	)

 

(a)

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	(49	)		$	—			$	—			$				$	(49	)
Options written			—				—				912,695				—				—				—				912,695
		$	—			$	—			$	912,646			$	—			$	—			$	—			$	912,646

 

(a)

Options purchased are included in net change in unrealized appreciation (depreciation) on investments.

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	63
Average value of option contracts written		$	2,789,183

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

 

 

70		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Health Sciences Trust (BME)

 

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Derivative Financial Instruments:
Options		$	250	(a)		$	1,418,657
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(250	)			(1,349,488	)
Total derivative assets and liabilities subject to an MNA		$	—			$	69,169

 

(a)

Includes options purchased at value which is included in Investments at value — unaffiliated in the Statements of Assets and Liabilities and reported in the Schedule of Investments.

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged				Cash Collateral Pledged				Net Amount of Derivative Liabilities  (a)
Barclays Bank PLC		$	7,849			$	—			$	—			$	—			$	7,849
Citibank N.A.			26,697				—				—				—				26,697
Credit Suisse International			24,407				—				—				—				24,407
Goldman Sachs International			9,154				—				—				—				9,154
Morgan Stanley & Co. International PLC			1,043				—				—				—				1,043
UBS AG			19				—				—				—				19
		$	69,169			$	—			$	—			$	—			$	69,169

 

(a)

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

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Biotechnology		$	55,452,746			$	1,696,035			$	1,870,677			$	59,019,458
Diversified Consumer Services			2,021,052				—				—				2,021,052
Health Care Equipment & Supplies			87,758,919				1,653,508				—				89,412,427
Health Care Providers & Services			75,490,717				—				—				75,490,717
Health Care Technology			1,665,552				—				—				1,665,552
Life Sciences Tools & Services			16,011,690				680,382				—				16,692,072
Pharmaceuticals			71,422,437				11,706,980				420,806				83,550,223
Other Interests			—				—				117,899				117,899
Preferred Stock			—				—				632,946				632,946
Short-Term Securities			25,967,520				—				—				25,967,520
Options Purchased:
Equity Contracts			250				—				—				250
Subtotal		$	335,790,883			$	15,736,905			$	3,042,328			$	354,570,116
Investments Valued at NAV(a)															4,665
Total Investments														$	354,574,781
Derivative Financial Instruments(b)
Liabilities:
Equity contracts		$	(1,200,518	)		$	(218,139	)		$	—			$	(1,418,657	)

 

(a)

As of December 31, 2018, certain of the Trust’s Investments were fair valued using net asset value (“NAV”) per share and have been excluded from the fair value hierarchy.

(b)

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

During the year ended December 31, 2018, there were no transfers between Level 1 and Level 2.

 

 

SCHEDULES OF INVESTMENTS			71

---

Schedule of Investments  (continued) December 31, 2018		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 year 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				Other Interests				Preferred Stocks				Rights				Total
Assets:
Opening Balance, as of December 31, 2017		$	1,916,972			$	387,926			$	—			$	141,355			$	2,446,253
Transfers into Level 3			—				—				—				—				—
Transfers out of Level 3			—				—				—				—				—
Accrued discounts/premiums			—				—				—				—				—
Net realized gain (loss)			—				—				—				221,060				221,060
Net change in unrealized appreciation (depreciation)(a)(b)			31,575				(270,027	)			127,536				(115,507	)			(226,423	)
Purchases			342,936								505,410								848,346
Sales			—				—				—				(246,908	)			(246,908	)
Closing Balance as of December 31, 2018		$	2,291,483			$	117,899			$	632,946			$	—			$	3,042,328
Net change in unrealized appreciation (depreciation) on investments held as of December 31, 2018(b)		$	31,575			$	(270,027	)		$	127,537			$	—			$	(110,915	)

 

(a)

Included in the related net change in unrealized appreciation (depreciation) in the Statements of Operations.

(b)

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on derivative financial instruments still held at December 31, 2018 is generally due to derivative financial instruments no longer held or categorized as Level 3 at period end.

See notes to financial statements

 

 

72		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Consolidated Schedule of Investments December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX) (Percentages shown are based on Net Assets)

 

 

 

CONSOLIDATED SCHEDULES OF INVESTMENTS			73

---

Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

(h)	During the year ended December 31, 2018, investments in issuers considered to be affiliates 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 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Changes in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			16,156,750				(2,504,362	)			13,652,388			$	13,652,388			$	186,529			$	__			$	__
SL Liquidity Series, LLC, Money Market Series			488,032				(211,533	)			276,499				276,471				16,485	(b)			__				11
														$	13,928,859			$	203,014			$	__			$	11

 

(a)

Includes net capital gain distributions, if applicable.

(b)

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

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Purchased

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Exxon Mobil Corp.			94				01/04/19			USD			77			USD			641			$	3,525
Exxon Mobil Corp.			94				1/11/19			USD			78			USD			641				470
																						$	3,995

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Anadarko Petroleum Corp.			195				01/04/19			USD			55.00			USD			855			$	(1,170	)
Archer-Daniels-Midland Co.			675				01/04/19			USD			47.00			USD			2,765				(5,400	)
CF Industries Holdings, Inc.			432				01/04/19			USD			47.50			USD			1,880				(10,800	)
ConocoPhillips			140				01/04/19			USD			68.00			USD			873				(420	)
Devon Energy Corp.			299				01/04/19			USD			28.50			USD			674				(1,196	)
Exxon Mobil Corp.			94				01/04/19			USD			80.00			USD			641				(188	)
Hormel Foods Corp.			94				01/04/19			USD			45.00			USD			401				(4,700	)
Newmont Mining Corp.			356				01/04/19			USD			32.00			USD			1,234				(94,162	)
Pioneer Natural Resources Co.			40				01/04/19			USD			152.50			USD			526				(2,000	)
Royal Dutch Shell PLC — ADR, Class A			974				01/04/19			USD			61.50			USD			5,675				(38,960	)
Teck Resources Ltd.			608				01/04/19			USD			22.00			USD			1,310				(13,680	)
Teck Resources Ltd.			246				01/04/19			USD			23.50			USD			530				(3,198	)
Valero Energy Corp.			95				01/04/19			USD			84.00			USD			712				(380	)
Vale SA — ADR			1,348				01/04/19			USD			14.50			USD			1,778				(2,696	)
Archer-Daniels-Midland Co.			675				01/11/19			USD			47.00			USD			2,765				(4,050	)
BP PLC — ADR			638				01/11/19			USD			42.00			USD			2,419				(1,914	)
CF Industries Holdings, Inc.			432				01/11/19			USD			47.50			USD			1,880				(8,640	)
ConocoPhillips			73				01/11/19			USD			71.00			USD			455				(292	)
Deere & Co.			127				01/11/19			USD			160.00			USD			1,894				(6,414	)
Exxon Mobil Corp.			94				01/11/19			USD			80.00			USD			641				(282	)
Halliburton Co.			115				01/11/19			USD			32.00			USD			306				(345	)
Halliburton Co.			227				01/11/19			USD			33.53			USD			603				—
Marathon Petroleum Corp.			41				01/11/19			USD			65.00			USD			242				(492	)
Marathon Petroleum Corp.			53				01/11/19			USD			65.50			USD			313				(450	)
Mosaic Co.			394				01/11/19			USD			37.50			USD			1,151				(13,396	)
Newmont Mining Corp.			221				01/11/19			USD			33.50			USD			766				(32,819	)
Pioneer Natural Resources Co.			96				01/11/19			USD			143.00			USD			1,263				(6,480	)
Royal Dutch Shell PLC — ADR, Class A			432				01/11/19			USD			60.00			USD			2,517				(14,040	)
Teck Resources Ltd.			943				01/11/19			USD			23.50			USD			2,031				(11,316	)
Vale SA — ADR			1,348				01/11/19			USD			14.50			USD			1,778				(8,088	)

 

 

74		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Valero Energy Corp.			96				01/11/19			USD			84.01			USD			720			$	(1,110	)
Anadarko Petroleum Corp.			178				01/18/19			USD			55.00			USD			780				(801	)
Archer-Daniels-Midland Co.			675				01/18/19			USD			47.00			USD			2,765				(3,037	)
Baker Hughes a GE Co., Class A			295				01/18/19			USD			26.00			USD			634				(7,375	)
BP PLC — ADR			700				01/18/19			USD			42.00			USD			2,654				(2,100	)
BP PLC — ADR			687				01/18/19			USD			41.00			USD			2,605				(4,809	)
Bunge Ltd.			191				01/18/19			USD			65.00			USD			1,021				(3,820	)
CF Industries Holdings, Inc.			431				01/18/19			USD			47.50			USD			1,875				(16,809	)
Concho Resources, Inc.			64				01/18/19			USD			135.00			USD			658				(960	)
Devon Energy Corp.			201				01/18/19			USD			30.00			USD			453				(201	)
First Quantum Minerals Ltd.			930				01/18/19			CAD			13.00			CAD			1,027				(11,581	)
First Quantum Minerals Ltd.			851				01/18/19			CAD			15.00			CAD			940				(2,182	)
First Quantum Minerals Ltd.			427				01/18/19			CAD			14.00			CAD			471				(2,502	)
FMC Corp.			137				01/18/19			USD			80.00			USD			1,013				(4,110	)
FMC Corp.			350				01/18/19			USD			85.00			USD			2,589				(3,500	)
Halliburton Co.			115				01/18/19			USD			33.00			USD			306				(287	)
Halliburton Co.			227				01/18/19			USD			35.45			USD			603				(1	)
Hormel Foods Corp.			240				01/18/19			USD			45.00			USD			1,024				(4,800	)
Lundin Mining Corp.			3,430				01/18/19			CAD			6.00			CAD			1,935				(31,406	)
Mosaic Co.			396				01/18/19			USD			37.00			USD			1,157				(1,188	)
Mosaic Co.			501				01/18/19			USD			39.00			USD			1,463				(14,028	)
Newmont Mining Corp.			355				01/18/19			USD			34.00			USD			1,230				(47,570	)
Packaging Corp. of America			694				01/18/19			USD			95.00			USD			5,792				(20,820	)
Pioneer Natural Resources Co.			63				01/18/19			USD			160.00			USD			829				(2,520	)
Randgold Resources Ltd. — ADR			273				01/18/19			USD			82.50			USD			2,265				(65,520	)
Rio Tinto PLC — ADR			334				01/18/19			USD			52.50			USD			1,619				(6,680	)
Royal Dutch Shell PLC — ADR, Class A			525				01/18/19			USD			62.50			USD			3,059				(6,563	)
Stelco Holdings, Inc.			354				01/18/19			CAD			22.00			CAD			438				(2,593	)
Stelco Holdings, Inc.			291				01/18/19			CAD			23.00			CAD			533				(2,132	)
Suncor Energy, Inc.			389				01/18/19			CAD			48.00			CAD			1,483				(1,425	)
Suncor Energy, Inc.			114				01/18/19			CAD			46.00			CAD			435				(459	)
Teck Resources Ltd.			295				01/18/19			USD			24.00			USD			635				(5,162	)
Teck Resources Ltd.			915				01/18/19			USD			22.00			USD			1,971				(64,508	)
Teck Resources Ltd.			208				01/18/19			USD			23.00			USD			448				(7,800	)
Vale SA — ADR			364				01/18/19			USD			14.00			USD			480				(6,552	)
Valero Energy Corp.			60				01/18/19			USD			90.00			USD			450				(270	)
Valero Energy Corp.			167				01/18/19			USD			87.50			USD			1,252				(1,085	)
Williams Cos., Inc.			1,025				01/18/19			USD			25.00			USD			2,260				(5,125	)
Baker Hughes a GE Co., Class A			83				01/25/19			USD			23.12			USD			178				(1,931	)
BP PLC — ADR			688				01/25/19			USD			41.00			USD			2,609				(8,600	)
ConocoPhillips			72				01/25/19			USD			68.00			USD			449				(2,772	)
Devon Energy Corp.			198				01/25/19			USD			27.50			USD			446				(1,485	)
Exxon Mobil Corp.			157				01/25/19			USD			79.00			USD			1,071				(863	)
Halliburton Co.			184				01/25/19			USD			30.50			USD			489				(3,496	)
Hormel Foods Corp.			184				01/25/19			USD			43.50			USD			785				(13,800	)
Marathon Petroleum Corp.			106				01/25/19			USD			65.50			USD			626				(4,081	)
Mosaic Co.			310				01/25/19			USD			30.50			USD			906				(20,770	)
Royal Dutch Shell PLC — ADR, Class A			432				01/25/19			USD			60.50			USD			2,517				(24,840	)
Teck Resources Ltd.			245				01/25/19			USD			24.50			USD			528				(5,145	)
Vale SA — ADR			545				01/25/19			USD			14.00			USD			719				(13,080	)
Valero Energy Corp.			58				01/25/19			USD			78.00			USD			435				(9,976	)
Anadarko Petroleum Corp.			176				02/01/19			USD			51.00			USD			772				(6,776	)
Baker Hughes a GE Co. , Class A			83				02/01/19			USD			23.12			USD			178				(2,227	)
BP PLC — ADR Each Representing Six PLC			688				02/01/19			USD			41.01			USD			2,609				(17,477	)
ConocoPhillips			232				02/01/19			USD			65.00			USD			1,447				(33,060	)
Devon Energy Corp.			209				02/01/19			USD			27.50			USD			471				(2,717	)
Exxon Mobil Corp.			283				02/01/19			USD			71.00			USD			1,930				(36,507	)
Exxon Mobil Corp.			236				02/01/19			USD			70.00			USD			1,609				(39,412	)
Marathon Petroleum Corp.			78				02/01/19			USD			60.50			USD			460				(16,419	)
Newmont Mining Corp.			242				02/01/19			USD			34.50			USD			839				(33,154	)
Pioneer Natural Resources Co.			43				02/01/19			USD			138.00			USD			566				(17,200	)
Royal Dutch Shell PLC — ADR, Class A			432				02/01/19			USD			58.50			USD			2,517				(72,360	)

 

 

CONSOLIDATED SCHEDULES OF INVESTMENTS			75

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Teck Resources Ltd.			294				02/01/19			USD			24.00			USD			633			$	(9,996	)
Teck Resources Ltd.			485				02/01/19			USD			22.00			USD			1,045				(47,530	)
Vale SA — ADR			561				02/01/19			USD			14.50			USD			740				(10,379	)
Vale SA — ADR			500				02/01/19			USD			13.50			USD			660				(24,500	)
Royal Dutch Shell PLC — ADR, Class A			432				02/06/19			USD			58.51			USD			2,517				(66,543	)
BP PLC — ADR Each Representing Six PLC			638				02/08/19			USD			39.26			USD			2,419				(49,290	)
Exxon Mobil Corp.			236				02/08/19			USD			70.01			USD			1,609				(27,866	)
BP PLC — ADR			638				02/15/19			USD			42.00			USD			2,419				(13,079	)
Canadian Natural Resources Ltd.			42				02/15/19			CAD			34.00			CAD			1,390				(41,885	)
Concho Resources, Inc.			80				02/15/19			USD			112.00			USD			822				(24,593	)
ConocoPhillips			166				02/15/19			USD			67.50			USD			1,035				(20,418	)
ConocoPhillips			76				02/15/19			USD			65.00			USD			474				(15,846	)
Exxon Mobil Corp.			284				02/15/19			USD			80.00			USD			1,937				(3,266	)
Exxon Mobil Corp.			236				02/15/19			USD			70.00			USD			1,609				(44,958	)
First Quantum Minerals Ltd.			50				02/15/19			CAD			13.00			CAD			552				(19,045	)
First Quantum Minerals Ltd.			245				02/15/19			CAD			12.00			CAD			2,705				(145,363	)
Newmont Mining Corp.			242				02/15/19			USD			35.00			USD			839				(34,122	)
Teck Resources Ltd.			190				02/15/19			USD			25.00			USD			409				(7,505	)
Trimble, Inc.			14				02/15/19			USD			35.00			USD			46				(1,435	)
Vale SA — ADR			1,180				02/15/19			USD			14.00			USD			1,556				(48,380	)
																						$	(1,695,506	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
ArcelorMittal SA		Morgan Stanley & Co. International PLC			44,400				01/03/19			EUR			22.50			EUR			802			$	—
First Quantum Minerals Ltd.		Royal Bank of Canada			56,000				01/03/19			CAD			13.86			CAD			618				—
Fresnillo PLC		Goldman Sachs International			96,000				01/03/19			GBP			8.48			GBP			828				(35,878	)
Glencore PLC		Morgan Stanley & Co. International PLC			662,000				01/03/19			GBP			3.06			GBP			1,933				(8,704	)
OZ Minerals Ltd.		Goldman Sachs International			145,000				01/03/19			AUD			9.28			AUD			1,276				(1,216	)
Stelco Holdings, Inc.		Credit Suisse International			25,000				01/03/19			CAD			21.78			CAD			377				—
Suncor Energy, Inc.		Goldman Sachs International			19,400				01/03/19			CAD			46.20			CAD			740				—
TOTAL SA		Morgan Stanley & Co. International PLC			52,200				01/03/19			EUR			51.51			EUR			2,403				—
Vale SA — ADR		Barclays Bank PLC			60,000				01/03/19			USD			15.66			USD			791				—
Bunge Ltd.		Barclays Bank PLC			18,800				01/04/19			USD			58.63			USD			1,005				(11	)
First Quantum Minerals Ltd.		Citibank N.A.			42,000				01/04/19			CAD			14.25			CAD			464				(5	)
Suncor Energy, Inc.		Goldman Sachs International			45,600				01/04/19			CAD			44.18			CAD			1,739				—
Suncor Energy, Inc.		Credit Suisse International			17,100				01/07/19			CAD			46.00			CAD			652				(12	)
CNOOC Ltd.		UBS AG			587,000				01/08/19			HKD			14.23			HKD			7,079				(335	)
Smurfit Kappa Group PLC		Morgan Stanley & Co. International PLC			67,100				01/08/19			EUR			29.35			EUR			1,558				(47	)
ArcelorMittal SA		Goldman Sachs International			83,100				01/09/19			EUR			23.16			EUR			1,502				(46	)
First Quantum Minerals Ltd.		Goldman Sachs International			81,200				01/09/19			CAD			13.46			CAD			896				(1,542	)
OZ Minerals Ltd.		Citibank N.A.			258,600				01/09/19			AUD			9.58			AUD			2,276				(2,348	)
TOTAL SA		Morgan Stanley & Co. International PLC			44,000				01/09/19			EUR			53.35			EUR			2,026				(14	)
Trimble, Inc.		Citibank N.A.			22,000				01/09/19			USD			38.20			USD			724				(31	)
BHP Group PLC		UBS AG			158,700				01/10/19			GBP			16.44			GBP			2,631				(91,745	)
First Quantum Minerals Ltd.		Royal Bank of Canada			56,000				01/10/19			CAD			13.86			CAD			618				(925	)
Stelco Holdings, Inc.		Credit Suisse International			20,000				01/11/19			CAD			19.33			CAD			301				(5	)
Stelco Holdings, Inc.		Credit Suisse International			30,000				01/11/19			CAD			21.70			CAD			452				—
Suncor Energy, Inc.		Credit Suisse International			17,000				01/11/19			CAD			45.48			CAD			648				(3	)
Vale SA — ADR		Citibank N.A.			114,600				01/11/19			USD			15.60			USD			1,512				(366	)
CNOOC Ltd.		UBS AG			587,000				01/15/19			HKD			14.23			HKD			7,079				(1,117	)
First Quantum Minerals Ltd.		Royal Bank of Canada			56,000				01/15/19			CAD			14.05			CAD			618				(1,168	)
Glanbia PLC		Goldman Sachs International			48,400				01/15/19			EUR			17.43			EUR			794				(5,798	)
Randgold Resources Ltd. — ADR		Goldman Sachs International			18,300				01/15/19			USD			84.00			USD			1,518				(20,761	)
Stelco Holdings, Inc.		Credit Suisse International			37,500				01/15/19			CAD			21.90			CAD			565				—
Suncor Energy, Inc.		Goldman Sachs International			45,600				01/15/19			CAD			44.39			CAD			1,739				(1,113	)
ArcelorMittal SA		Goldman Sachs International			30,800				01/16/19			EUR			20.52			EUR			559				(1,497	)
Fresnillo PLC		Goldman Sachs International			96,000				01/16/19			GBP			8.56			GBP			828				(50,277	)
Glencore International PLC		Morgan Stanley & Co. International PLC			662,000				01/16/19			GBP			3.10			GBP			1,933				(26,332	)

 

 

76		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call (continued)
TOTAL SA		Credit Suisse International			69,000				01/16/19				EUR				48.97				EUR				3,177			$	(9,469	)
Umicore SA		Credit Suisse International			25,700				01/16/19				EUR				37.41				EUR				895				(10,594	)
First Quantum Minerals Ltd.		Credit Suisse International			125,000				01/22/19				CAD				13.26				CAD				1,380				(12,760	)
ArcelorMittal SA		Morgan Stanley & Co. International PLC			108,400				01/23/19				EUR				20.31				EUR				1,959				(12,759	)
Canadian Natural Resources Ltd.		Credit Suisse International			29,000				01/23/19				CAD				37.51				CAD				955				(3,676	)
Smurfit Kappa Group PLC		UBS AG			58,000				01/23/19				EUR				24.72				EUR				1,347				(31,158	)
Suncor Energy, Inc.		Credit Suisse International			47,800				01/23/19				CAD				42.56				CAD				1,823				(5,401	)
TOTAL SA		UBS AG			70,200				01/23/19				EUR				50.27				EUR				3,242				(5,761	)
Trimble, Inc.		Barclays Bank PLC			34,500				01/23/19				USD				36.53				USD				1,135				(5,826	)
BHP Group PLC		UBS AG			208,600				01/24/19				GBP				16.13				GBP				3,459				(206,777	)
FMC Corp.		Deutsche Bank AG			32,200				01/24/19				USD				77.19				USD				2,382				(35,481	)
Fresnillo PLC		Credit Suisse International			178,000				01/24/19				GBP				8.02				GBP				1,534				(186,075	)
Mondi PLC		Goldman Sachs International			138,200				01/24/19				GBP				17.93				GBP				2,258				(21,385	)
Randgold Resources Ltd. — ADR		Barclays Bank PLC			26,900				01/24/19				USD				87.09				USD				2,230				(26,125	)
Yara International ASA		Goldman Sachs International			39,100				01/24/19				NOK				358.26				NOK				13,033				(8,223	)
First Quantum Minerals Ltd.		Credit Suisse International			125,000				01/25/19				CAD				13.26				CAD				1,380				(16,050	)
Glencore International PLC		UBS AG			1,326,100				01/25/19				GBP				3.05				GBP				3,872				(109,134	)
Stelco Holdings, Inc.		Credit Suisse International			37,500				01/25/19				CAD				22.10				CAD				565				(12	)
Lundin Mining Corp.		Goldman Sachs International			238,000				01/29/19				CAD				6.03				CAD				1,342				(32,829	)
Rio Tinto PLC — ADR		Goldman Sachs International			54,300				01/29/19				USD				49.49				USD				2,632				(59,351	)
TOTAL SA		Credit Suisse International			38,000				01/29/19				EUR				48.58				EUR				1,750				(14,914	)
ArcelorMittal SA		Goldman Sachs International			58,000				01/30/19				EUR				20.36				EUR				1,048				(9,657	)
BHP Group PLC		Goldman Sachs International			199,000				01/30/19				GBP				16.96				GBP				3,299				(108,760	)
FMC Corp.		Deutsche Bank AG			32,300				01/30/19				USD				77.19				USD				2,389				(43,667	)
Glencore International PLC		Goldman Sachs International			550,700				01/30/19				GBP				2.98				GBP				1,608				(69,121	)
Ingredion, Inc.		Citibank N.A.			17,000				01/30/19				USD				92.44				USD				1,554				(43,272	)
CNOOC Ltd.		JPMorgan Chase Bank N.A.			454,000				01/31/19				HKD				13.40				HKD				5,475				(9,580	)
First Quantum Minerals Ltd.		Royal Bank of Canada			56,000				01/31/19				CAD				14.25				CAD				618				(7,313	)
Glanbia PLC		UBS AG			83,600				01/31/19				EUR				17.23				EUR				1,370				(26,009	)
OZ Minerals Ltd.		Goldman Sachs International			258,600				01/31/19				AUD				9.09				AUD				2,276				(40,527	)
Stelco Holdings, Inc.		Citibank N.A.			28,700				01/31/19				CAD				20.32				CAD				432				(216	)
Umicore SA		Credit Suisse International			26,500				01/31/19				EUR				36.82				EUR				923				(18,106	)
Suncor Energy, Inc.		Goldman Sachs International			33,300				02/01/19				CAD				43.81				CAD				1,270				(3,584	)
Trimble, Inc.		Citibank N.A.			34,500				02/01/19				USD				36.65				USD				1,135				(9,170	)
CNOOC Ltd.		JPMorgan Chase Bank N.A.			877,000				02/04/19				HKD				12.88				HKD				10,577				(30,620	)
Canadian Natural Resources Ltd.		Credit Suisse International			29,000				02/06/19				CAD				37.51				CAD				955				(8,016	)
Glanbia PLC		UBS AG			49,200				02/06/19				EUR				17.15				EUR				806				(19,464	)
Ingredion, Inc.		Citibank N.A.			17,000				02/06/19				USD				92.44				USD				1,554				(49,096	)
Rio Tinto PLC — ADR		UBS AG			30,000				02/07/19				USD				47.17				USD				1,454				(85,748	)
Suncor Energy, Inc.		Goldman Sachs International			42,200				02/07/19				CAD				37.66				CAD				1,609				(59,238	)
Baker Hughes a GE Co., Class A		Deutsche Bank AG			29,400				02/08/19				USD				22.01				USD				632				(19,581	)
TOTAL SA		UBS AG			75,100				02/12/19				EUR				48.21				EUR				3,468				(53,108	)
Fresnillo PLC		Credit Suisse International			178,000				02/13/19				GBP				8.02				GBP				1,534				(213,021	)
Ingredion, Inc.		Citibank N.A.			17,000				02/13/19				USD				92.44				USD				1,554				(54,429	)
Mondi PLC		UBS AG			73,200				02/13/19				GBP				17.57				GBP				1,196				(31,364	)
Rio Tinto PLC — ADR		Goldman Sachs International			54,300				02/13/19				USD				49.49				USD				2,632				(79,336	)
Suncor Energy, Inc.		Goldman Sachs International			40,000				02/14/19				CAD				41.73				CAD				1,525				(17,639	)
Yara International ASA		Goldman Sachs International			39,600				02/20/19				NOK				349.98				NOK				13,199				(41,668	)
																												$	(2,216,366	)

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

 

		Swap Premiums Paid				Swap Premiums Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	4,789,164			$	(532,994	)		$	(3,911,872	)

 

 

CONSOLIDATED SCHEDULES OF INVESTMENTS			77

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Assets — Derivative Financial Instruments
Options purchased
Investments at value — unaffiliated(a)		$	—			$	—			$	3,995			$	—			$	—			$	—			$	3,995
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	3,911,872			$	—			$	—			$	—			$	3,911,872

 

(a)

Includes options purchased at value as reported in the Consolidated Schedule of Investments.

For the period ended December 31, 2018, the effect of derivative financial instruments in the Consolidated Statement of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchase(a)		$	—			$	—			$	(11,972	)		$	—			$	—			$	—			$	(11,972	)
Options written			—				—				(1,950,043	)			—				—				—				(1,950,043	)
		$	—			$	—			$	(1,962,015	)		$	—			$	—			$	—			$	(1,962,015	)

 

(a)

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

 

Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	3,011			$	—			$	—			$	—			$	3,011
Options written			—				—				12,466,021				—				—				—				12,466,021
		$	—			$	—			$	12,469,032			$	—			$	—			$	—			$	12,469,032

 

(a)

Options purchased are included in net change in unrealized appreciation (depreciation) from investments.

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of contracts purchased		$	2,094
Average value of contracts written		$	6,816,663

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Derivative Financial Instruments:
Options		$	3,995	(a)		$	3,911,872
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			(3,995	)			(1,695,506	)
Total derivative assets and liabilities subject to an MNA		$	—			$	2,216,366

 

(a)

Includes options purchased at value which is included in Investments at value — unaffiliated in the Consolidated Statement of Assets and Liabilities and reported in the Schedule of Investments.

 

 

78		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities (b)
Barclays Bank PLC		$	31,962			$	—			$	(31,962	)		$	—			$	—
Citibank N.A.			158,933				—				(24,139	)			—				134,794
Credit Suisse International			498,114				—				(498,114	)			—				—
Deutsche Bank AG			98,729				—				—				—				98,729
Goldman Sachs International			669,446				—				(505,072	)			—				164,374
JPMorgan Chase Bank N.A.			40,200				—				(40,200	)			—				—
Morgan Stanley & Co. International PLC			47,856				—				(47,856	)			—				—
Royal Bank of Canada			9,406				—				—				—				9,406
UBS AG			661,720				—				(661,720	)			—				—
		$	2,216,366			$	—			$	(1,809,063	)		$	—			$	407,303

 

(a)

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

(b)

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

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Chemicals		$	97,157,373			$	12,762,701			$	—			$	109,920,074
Containers & Packaging			14,492,245				8,002,609				—				22,494,854
Electronic Equipment, Instruments & Components			7,602,967				—				—				7,602,967
Energy Equipment & Services			9,833,991				—				—				9,833,991
Food Products			42,909,586				8,505,284				—				51,414,870
Machinery			4,768,070				—				—				4,768,070
Metals & Mining			132,382,889				140,351,255				15,030,195				287,764,339
Oil, Gas & Consumable Fuels			203,535,757				59,649,766				—				263,185,523
Paper & Forest Products			—				11,169,508				56				11,169,564
Pharmaceuticals			5,095,218				—				—				5,095,218
Corporate Bonds			4,108,961				9,997,317				1,578,600				15,684,878
Short-Term Securities			13,652,388				—				—				13,652,388
Options Purchased:
Equity contracts			3,995				—				—				3,995
Subtotal		$	535,543,440			$	250,438,440			$	16,608,851			$	802,590,731
Investments Valued at NAV(a)															276,471
Total Investments														$	802,867,202
Derivative Financial Instruments(b)
Liabilities:
Equity contracts		$	(1,504,468	)		$	(2,407,404	)		$	—			$	(3,911,872	)

 

(a)

As of December 31, 2018, certain of the Trust’s Investments were fair valued using net asset value (“NAV”) per share and have been excluded from the fair value hierarchy.

(b)

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

 

 

CONSOLIDATED SCHEDULES OF INVESTMENTS			79

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Consolidated Schedule of Investments  (continued) December 31, 2018		BlackRock Resources & Commodities Strategy Trust (BCX)

 

Transfers between Level 1 and Level 2 were as follows:

 

		Transfers into Level 1 (a)				Transfers out of Level 2 (a)
Assets:
Long-Term Investments:
Corporate Bonds		$	4,653,795			$	4,653,795

 

(a)

External pricing service used to reflect any significant market movements between the time the Trust valued such foreign securities and the earlier closing of foreign markets.

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 year 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				Corporate Bonds				Total
Assets:
Opening Balance, as of December 31, 2017		$	62			$	—			$	62
Transfers into Level 3			—				—				—
Transfers out of Level 3			—				—				—
Accrued discounts/premiums			—				—				—
Net realized gain (loss)			(2,074	)			—				(2,074	)
Net change in unrealized appreciation (depreciation)(a)(b)			2,653,048				(221,400	)			2,431,648
Purchases			12,576,773				1,800,000				14,376,773
Sales			(197,558	)			—				(197,558	)
Closing Balance as of December 31, 2018		$	15,030,251			$	1,578,600			$	16,608,851
Net change in unrealized appreciation (depreciation) on investments held as of December 31, 2018(b)		$	2,653,048			$	(221,400	)		$	2,431,648

 

(a)

Included in the related net change in unrealized appreciation (depreciation) in the Consolidated Statement of Operations.

(b)

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on derivative financial instruments still held at December 31, 2018 is generally due to derivative financial instruments no longer held or categorized as Level 3 at period end.

See notes to financial statements.

 

 

80		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments December 31, 2018		BlackRock Science and Technology Trust (BST) (Percentages shown are based on Net Assets)

 

 

 

SCHEDULES OF INVESTMENTS			81

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Schedule of Investments  (continued) December 31, 2018		BlackRock Science and Technology Trust (BST) (Percentages shown are based on Net Assets)

 

(i)	During the year ended December 31, 2018, investments in issuers considered to be affiliates 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 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			4,696,297				42,640				4,738,937			$	4,738,937			$	182,611			$	—			$	—
SL Liquidity Series, LLC, Money Market Series			3,497,053				(1,786,801	)			1,710,252				1,710,081				159,000	(b)			(842	)			2
														$	6,449,018				341,611			$	(842	)		$	2

 

(a)

Includes net capital gain distributions, if applicable.

(b)

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

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Activision Blizzard, Inc.			263				01/04/19			USD			56.50			USD			1,225			$	(789	)
Adobe, Inc.			73				01/04/19			USD			255.00			USD			1,652				(438	)

 

 

82		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Alibaba Group Holding Ltd. — ADR			75				01/04/19			USD			160.00			USD			1,028			$	(75	)
Alphabet, Inc., Class A			15				01/04/19			USD			1,080.00			USD			1,567				(4,687	)
Amazon.com, Inc.			13				01/04/19			USD			1,700.00			USD			1,953				(448	)
Autodesk, Inc.			62				01/04/19			USD			149.00			USD			797				(186	)
Cree, Inc.			80				01/04/19			USD			46.50			USD			342				(640	)
Facebook, Inc., Class A			64				01/04/19			USD			149.00			USD			839				(64	)
Marvell Technology Group Ltd.			100				01/04/19			USD			17.50			USD			162				(400	)
Mastercard, Inc.			71				01/04/19			USD			200.00			USD			1,339				(958	)
Netflix, Inc.			24				01/04/19			USD			290.00			USD			642				(1,080	)
PayPal Holdings, Inc.			95				01/04/19			USD			84.50			USD			799				(11,258	)
ServiceNow, Inc.			66				01/04/19			USD			187.50			USD			1,175				(4,290	)
Shopify, Inc.			34				01/04/19			USD			155.00			USD			471				(340	)
Skyworks Solutions, Inc.			110				01/04/19			USD			76.00			USD			737				(1,650	)
Take-Two Interactive Software, Inc.			26				01/04/19			USD			112.00			USD			268				(195	)
Visa, Inc., Class A			57				01/04/19			USD			143.00			USD			752				(228	)
Yandex NV			400				01/04/19			USD			32.00			USD			1,094				(2,000	)
salesforce.com, Inc.			86				01/04/19			USD			135.00			USD			1,178				(29,885	)
Avalara, Inc.			165				01/08/19			USD			35.01			USD			514				(2,856	)
Activision Blizzard, Inc.			112				01/11/19			USD			52.50			USD			522				(7,392	)
Adobe, Inc.			50				01/11/19			USD			267.50			USD			1,131				(2,250	)
Advanced Micro Devices, Inc.			421				01/11/19			USD			20.00			USD			777				(18,735	)
Alibaba Group Holding Ltd. — ADR			83				01/11/19			USD			160.00			USD			1,138				(539	)
Alphabet, Inc., Class A			6				01/11/19			USD			1,100.00			USD			627				(2,760	)
Amazon.com, Inc.			13				01/11/19			USD			1,770.00			USD			1,953				(3,601	)
Apple, Inc.			63				01/11/19			USD			197.30			USD			994				(5	)
Apple, Inc.			48				01/11/19			USD			180.96			USD			757				(164	)
Autodesk, Inc.			57				01/11/19			USD			140.00			USD			733				(4,845	)
Cree, Inc.			100				01/11/19			USD			47.00			USD			428				(2,350	)
Facebook, Inc., Class A			24				01/11/19			USD			147.00			USD			315				(396	)
Marvell Technology Group Ltd.			381				01/11/19			USD			16.50			USD			617				(12,573	)
Microsoft Corp.			175				01/11/19			USD			112.00			USD			1,777				(2,100	)
Roku, Inc.			140				01/11/19			USD			40.00			USD			429				(2,100	)
Shopify, Inc.			43				01/11/19			USD			165.00			USD			595				(1,075	)
Take-Two Interactive Software, Inc.			92				01/11/19			USD			114.00			USD			947				(4,600	)
Visa, Inc., Class A			27				01/11/19			USD			142.00			USD			356				(553	)
Visa, Inc., Class A			27				01/11/19			USD			144.00			USD			356				(513	)
salesforce.com, Inc.			23				01/11/19			USD			146.00			USD			315				(2,001	)
58.com, Inc. — ADR			92				01/18/19			USD			70.00			USD			499				(4,140	)
58.com, Inc. — ADR			91				01/18/19			USD			65.00			USD			493				(1,820	)
Activision Blizzard, Inc.			112				01/18/19			USD			52.50			USD			522				(3,584	)
Adobe, Inc.			38				01/18/19			USD			260.00			USD			860				(1,767	)
Advanced Micro Devices, Inc.			618				01/18/19			USD			23.00			USD			1,141				(8,652	)
Alibaba Group Holding Ltd. — ADR			75				01/18/19			USD			160.00			USD			1,028				(1,650	)
Alibaba Group Holding Ltd. — ADR			65				01/18/19			USD			145.00			USD			891				(12,025	)
Alphabet, Inc., Class A			6				01/18/19			USD			1,130.00			USD			627				(2,490	)
Alphabet, Inc., Class A			8				01/18/19			USD			1,100.00			USD			836				(7,920	)
Amazon.com, Inc.			17				01/18/19			USD			1,800.00			USD			2,553				(2,720	)
Atlassian Corp. PLC, Class A			190				01/18/19			USD			85.00			USD			1,691				(133,000	)
Avalara, Inc.			66				01/18/19			USD			35.00			USD			206				(2,805	)
Coupa Software, Inc.			100				01/18/19			USD			70.00			USD			629				(10,500	)
Cree, Inc.			141				01/18/19			USD			45.00			USD			603				(11,421	)
Elastic NV			67				01/18/19			USD			65.00			USD			479				(54,605	)
Eventbrite, Inc., Class A			140				01/18/19			USD			35.00			USD			389				(2,100	)
Facebook, Inc., Class A			64				01/18/19			USD			150.00			USD			839				(1,824	)
Farfetch Ltd., Class A			387				01/18/19			USD			20.00			USD			685				(15,480	)
Guidewire Software, Inc.			58				01/18/19			USD			90.00			USD			465				(1,160	)
Guidewire Software, Inc.			58				01/18/19			USD			80.00			USD			465				(16,965	)
IAC/InterActiveCorp			53				01/18/19			USD			185.00			USD			970				(33,125	)
II-VI, Inc.			93				01/18/19			USD			40.00			USD			302				(4,650	)
InterXion Holding NV			190				01/18/19			USD			60.00			USD			1,029				(3,325	)
Keysight Technologies, Inc.			91				01/18/19			USD			60.00			USD			565				(28,210	)
Lam Research Corp.			42				01/18/19			USD			160.00			USD			572				(567	)

 

 

SCHEDULES OF INVESTMENTS			83

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Lam Research Corp.			146				01/18/19			USD			155.00			USD			1,988			$	(6,059	)
Marvell Technology Group Ltd.			100				01/18/19			USD			18.00			USD			162				(650	)
Mastercard, Inc.			163				01/18/19			USD			210.00			USD			3,075				(6,764	)
MercadoLibre, Inc.			85				01/18/19			USD			320.00			USD			2,489				(44,625	)
Microchip Technology, Inc.			72				01/18/19			USD			80.00			USD			518				(2,160	)
Microchip Technology, Inc.			83				01/18/19			USD			77.50			USD			597				(4,980	)
Microsoft Corp.			230				01/18/19			USD			110.00			USD			2,336				(10,810	)
Microsoft Corp.			42				01/18/19			USD			112.00			USD			427				(2,021	)
MongoDB, Inc.			117				01/18/19			USD			80.00			USD			980				(85,995	)
Monolithic Power Systems, Inc.			137				01/18/19			USD			135.00			USD			1,593				(10,275	)
NVIDIA Corp.			111				01/18/19			USD			170.00			USD			1,482				(2,497	)
NVIDIA Corp.			109				01/18/19			USD			165.00			USD			1,455				(3,542	)
Netflix, Inc.			47				01/18/19			USD			330.00			USD			1,258				(6,486	)
Netflix, Inc.			26				01/18/19			USD			315.00			USD			696				(7,423	)
Okta, Inc.			137				01/18/19			USD			60.00			USD			874				(81,515	)
PTC, Inc.			96				01/18/19			USD			90.00			USD			796				(11,280	)
Pagseguro Digital Ltd.			576				01/18/19			USD			27.50			USD			1,079				(14,400	)
PayPal Holdings, Inc.			95				01/18/19			USD			85.00			USD			799				(22,895	)
Pluralsight, Inc.			369				01/18/19			USD			25.00			USD			869				(32,288	)
SVMK, Inc.			260				01/18/19			USD			12.50			USD			319				(18,850	)
SendGrid, Inc.			129				01/18/19			USD			45.00			USD			557				(22,253	)
SendGrid, Inc.			130				01/18/19			USD			50.00			USD			561				(7,475	)
ServiceNow, Inc.			34				01/18/19			USD			200.00			USD			605				(3,230	)
Silicon Laboratories, Inc.			204				01/18/19			USD			80.00			USD			1,608				(49,470	)
Skyworks Solutions, Inc.			78				01/18/19			USD			77.50			USD			523				(1,560	)
Smartsheet, Inc., Class A			214				01/18/19			USD			30.00			USD			532				(5,350	)
Spotify Technology SA			40				01/18/19			USD			150.00			USD			454				(400	)
Square, Inc.			351				01/18/19			USD			75.00			USD			1,969				(2,281	)
Take-Two Interactive Software, Inc.			77				01/18/19			USD			110.00			USD			793				(15,978	)
Teladoc, Inc.			110				01/18/19			USD			70.00			USD			545				(1,375	)
Tesla, Inc.			28				01/18/19			USD			365.00			USD			932				(15,400	)
Twilio, Inc., Class A			70				01/18/19			USD			105.00			USD			625				(7,420	)
Viavi Solutions, Inc.			497				01/18/19			USD			11.00			USD			499				(3,479	)
Visa, Inc., Class A			54				01/18/19			USD			150.00			USD			712				(351	)
Visa, Inc., Class A			163				01/18/19			USD			135.00			USD			2,151				(37,001	)
Wix.com Ltd.			94				01/18/19			USD			95.00			USD			849				(21,620	)
Yandex NV			200				01/18/19			USD			33.00			USD			547				(2,000	)
Zendesk, Inc.			157				01/18/19			USD			60.00			USD			916				(33,363	)
Zscaler, Inc.			115				01/18/19			USD			43.00			USD			451				(9,775	)
salesforce.com, Inc.			24				01/18/19			USD			145.00			USD			329				(4,560	)
salesforce.com, Inc.			69				01/18/19			USD			140.00			USD			945				(25,530	)
Wix.com Ltd.			94				01/23/19			USD			94.67			USD			849				(33,916	)
Alibaba Group Holding Ltd. — ADR			83				01/25/19			USD			157.50			USD			1,138				(4,108	)
Alibaba Group Holding Ltd. — ADR			65				01/25/19			USD			145.00			USD			891				(17,323	)
Alphabet, Inc., Class A			12				01/25/19			USD			1,057.50			USD			1,254				(36,300	)
Amazon.com, Inc.			10				01/25/19			USD			1,705.00			USD			1,502				(8,475	)
Apple, Inc.			70				01/25/19			USD			170.00			USD			1,104				(11,130	)
Autodesk, Inc.			18				01/25/19			USD			145.00			USD			231				(1,611	)
Facebook, Inc., Class A			21				01/25/19			USD			134.00			USD			275				(8,820	)
Lam Research Corp.			41				01/25/19			USD			143.00			USD			558				(16,195	)
Mastercard, Inc.			88				01/25/19			USD			200.00			USD			1,660				(20,636	)
Microsoft Corp.			125				01/25/19			USD			113.00			USD			1,270				(5,812	)
Microsoft Corp.			236				01/25/19			USD			106.00			USD			2,397				(49,088	)
NVIDIA Corp.			52				01/25/19			USD			150.00			USD			694				(9,906	)
PayPal Holdings, Inc.			157				01/25/19			USD			95.00			USD			1,320				(7,065	)
Roku, Inc.			65				01/25/19			USD			35.00			USD			199				(6,077	)
ServiceNow, Inc.			33				01/25/19			USD			180.00			USD			588				(26,730	)
Shopify, Inc.			33				01/25/19			USD			148.00			USD			457				(15,015	)
Square, Inc.			361				01/25/19			USD			66.00			USD			2,025				(23,646	)
Square, Inc.			47				01/25/19			USD			64.50			USD			264				(4,136	)
Take-Two Interactive Software, Inc.			80				01/25/19			USD			115.00			USD			824				(10,800	)
Tesla, Inc.			30				01/25/19			USD			360.00			USD			998				(29,325	)

 

 

84		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call (continued)
Twilio, Inc., Class A			108				01/25/19			USD			105.00			USD			964			$	(14,634	)
Visa, Inc., Class A			56				01/25/19			USD			145.00			USD			739				(2,912	)
Visa, Inc., Class A			55				01/25/19			USD			142.00			USD			726				(4,372	)
salesforce.com, Inc.			46				01/25/19			USD			143.00			USD			630				(14,582	)
Oracle Corp.			54				01/31/19			USD			48.00			USD			244				(2,471	)
SVMK, Inc.			326				01/31/19			USD			13.00			USD			400				(27,156	)
Adobe, Inc.			37				02/01/19			USD			230.00			USD			837				(32,468	)
Alphabet, Inc., Class A			9				02/01/19			USD			1,050.00			USD			940				(39,915	)
Amazon.com, Inc.			13				02/01/19			USD			1,500.00			USD			1,953				(117,000	)
Apple, Inc.			37				02/01/19			USD			165.00			USD			584				(16,928	)
Marvell Technology Group Ltd.			242				02/01/19			USD			17.00			USD			392				(10,769	)
Microsoft Corp.			236				02/01/19			USD			106.00			USD			2,397				(61,478	)
Netflix, Inc.			25				02/01/19			USD			277.50			USD			669				(40,313	)
Oracle Corp.			109				02/01/19			USD			49.00			USD			492				(2,180	)
Oracle Corp.			63				02/01/19			USD			48.00			USD			284				(2,394	)
Roku, Inc.			231				02/01/19			USD			30.00			USD			708				(70,109	)
Shopify, Inc.			67				02/01/19			USD			162.50			USD			928				(14,740	)
Spotify Technology SA			16				02/01/19			USD			125.00			USD			182				(5,360	)
Square, Inc.			460				02/01/19			USD			61.50			USD			2,580				(89,010	)
Tableau Software, Inc.			148				02/01/19			USD			125.00			USD			1,776				(72,520	)
salesforce.com, Inc.			69				02/01/19			USD			138.00			USD			945				(42,608	)
Monolithic Power Systems, Inc.			65				02/05/19			USD			124.54			USD			756				(24,177	)
Advanced Micro Devices, Inc.			535				02/15/19			USD			24.00			USD			988				(30,495	)
Avalara, Inc.			131				02/15/19			USD			35.00			USD			408				(19,978	)
II-VI, Inc.			94				02/15/19			USD			35.00			USD			305				(15,510	)
InterXion Holding NV			96				02/15/19			USD			55.60			USD			520				(17,201	)
Keysight Technologies, Inc.			108				02/15/19			USD			62.50			USD			670				(28,620	)
Marvell Technology Group Ltd.			411				02/15/19			USD			17.00			USD			665				(27,537	)
Microchip Technology, Inc.			72				02/15/19			USD			72.50			USD			518				(28,800	)
Microsoft Corp.			157				02/15/19			USD			106.20			USD			1,595				(53,578	)
Pagseguro Digital Ltd.			468				02/15/19			USD			22.50			USD			877				(31,590	)
Roku, Inc.			65				02/15/19			USD			35.00			USD			199				(11,115	)
SendGrid, Inc.			258				02/15/19			USD			42.60			USD			1,114				(158,821	)
Spotify Technology SA			16				02/15/19			USD			130.00			USD			182				(7,120	)
Twilio, Inc., Class A			207				02/15/19			USD			90.00			USD			1,849				(203,895	)
Zscaler, Inc.			125				02/15/19			USD			38.00			USD			490				(51,250	)
salesforce.com, Inc.			92				02/15/19			USD			135.00			USD			1,260				(83,260	)
																							(2,965,890	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Aixtron SE		Goldman Sachs International			50,000				01/03/19			EUR			9.87			EUR			423			$	(72	)
Delivery Hero SE		Goldman Sachs International			12,500				01/03/19			EUR			35.35			EUR			407				(823	)
Altium Ltd.		Morgan Stanley & Co. International PLC			47,000				01/04/19			AUD			23.11			AUD			1,021				(5,475	)
Okta, Inc.		UBS AG			37,000				01/04/19			USD			60.07			USD			2,361				(156,440	)
Farfetch Ltd., Class A		JPMorgan Chase Bank N.A.			30,400				01/08/19			USD			24.37			USD			538				(74	)
Guidewire Software, Inc.		UBS AG			11,700				01/08/19			USD			88.29			USD			939				(809	)
Kingdee International Software Group Co. Ltd.		JPMorgan Chase Bank N.A.			575,000				01/09/19			HKD			8.60			HKD			3,979				(40	)
SOITEC		UBS AG			17,000				01/09/19			EUR			49.45			EUR			859				(53,418	)
STMicroelectronics NV		Credit Suisse International			21,600				01/09/19			EUR			12.19			EUR			267				(11,765	)
Bandwidth, Inc., Class A		Barclays Bank PLC			12,500				01/10/19			USD			49.81			USD			509				(152	)
Taiwan Semiconductor Manufacturing Co. Ltd.		JPMorgan Chase Bank N.A.			260,000				01/10/19			USD			225.12			USD			58,029				(39,494	)
UbiSoft Entertainment SA		UBS AG			14,300				01/10/19			EUR			63.97			EUR			1,005				(110,303	)
II-VI, Inc.		Citibank N.A.			9,300				01/11/19			USD			36.20			USD			302				(1,749	)
SailPoint Technologies Holding, Inc.		Goldman Sachs International			24,300				01/11/19			USD			27.43			USD			571				(1,652	)
Altair Engineering, Inc., Class A		JPMorgan Chase Bank N.A.			24,600				01/14/19			USD			30.86			USD			678				(9,432	)
Aixtron SE		Goldman Sachs International			34,200				01/15/19			EUR			10.05			EUR			289				(3,647	)
Delivery Hero SE		UBS AG			25,200				01/15/19			EUR			32.22			EUR			821				(37,821	)

 

 

SCHEDULES OF INVESTMENTS			85

---

Schedule of Investments  (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call (continued)
Kingdee International Software Group Co. Ltd.		JPMorgan Chase Bank N.A.			575,000				01/15/19				HKD				8.72				HKD				3,979			$	(1,004	)
ASML Holding NV		Goldman Sachs International			12,000				01/16/19				EUR				154.95				EUR				1,641				(4,113	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			886,000				01/16/19				USD				232.54				USD				197,746				(84,657	)
Zuora, Inc., Class A		Citibank N.A.			30,000				01/18/19				USD				22.48				USD				465				(3,250	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			68,000				01/23/19				USD				228.01				USD				544				(12,656	)
Tencent Holdings Ltd		Goldman Sachs International			149,700				01/23/19				HKD				334.97				HKD				15,177				(92,420	)
Zuora, Inc., Class A		Goldman Sachs International			30,000				01/23/19				USD				18.41				USD				46,983				(33,729	)
GMO Payment Gateway, Inc.		Goldman Sachs International			26,800				01/24/19				JPY				7,124.15				JPY				544				(991	)
Kingdee International Software Group Co. Ltd.		JPMorgan Chase Bank N.A.			575,000				01/24/19				HKD				8.85				HKD				125,066				(2,627	)
Ping An Healthcare and Technology PLC		Morgan Stanley & Co. International PLC			118,500				01/24/19				HKD				37.02				HKD				3,979				(626	)
Studio Dragon Corp.		Morgan Stanley & Co. International PLC			12,400				01/24/19				USD				105,876.00				USD				3,262				(9,674	)
II-VI, Inc.		Barclays Bank PLC			12,800				01/25/19				USD				35.94				USD				1,145,760				(16,427	)
Bandwidth, Inc., Class A		Morgan Stanley & Co. International PLC			8,400				01/29/19				USD				40.21				USD				415				(22,648	)
Viavi Solutions, Inc.		Deutsche Bank AG			49,700				01/29/19				USD				11.24				USD				342				(5,668	)
Adyen NV		Goldman Sachs International			1,500				01/30/19				EUR				478.64				EUR				499				(53,015	)
Eventbrite, Inc., Class A		UBS AG			10,350				01/30/19				USD				30.34				USD				707				(14,678	)
PTC, Inc.		Credit Suisse International			9,700				01/30/19				USD				91.85				USD				288				(12,796	)
SailPoint Technologies Holding, Inc.		Citibank N.A.			19,700				01/30/19				USD				26.08				USD				804				(15,201	)
Taiwan Semiconductor Manufacturing Co. Ltd.		UBS AG			66,000				01/30/19				USD				228.01				USD				14,731				(14,375	)
Tencent Holdings Ltd		Goldman Sachs International			109,500				01/30/19				HKD				333.08				HKD				34,367				(94,784	)
Zuora, Inc., Class A		Goldman Sachs International			30,000				01/30/19				USD				18.41				USD				544				(39,111	)
ASML Holding NV		Goldman Sachs International			9,300				01/31/19				EUR				149.70				EUR				1,276				(12,158	)
Coupa Software, Inc.		Citibank N.A.			10,700				01/31/19				USD				69.19				USD				673				(34,721	)
Xero Ltd.		Goldman Sachs International			42,000				01/31/19				AUD				40.75				AUD				1,767				(85,319	)
Altium Ltd.		Morgan Stanley & Co. International PLC			67,300				02/05/19				AUD				23.07				AUD				1,462				(44,232	)
Adyen NV		Goldman Sachs International			1,500				02/06/19				EUR				478.64				EUR				707				(59,643	)
STMicroelectronics NV		Goldman Sachs International			26,600				02/06/19				EUR				13.37				EUR				329				(11,121	)
SailPoint Technologies Holding, Inc.		Goldman Sachs International			21,500				02/06/19				USD				25.43				USD				505				(23,955	)
Wirecard AG		Goldman Sachs International			4,700				02/06/19				EUR				140.87				EUR				618				(22,260	)
Pluralsight, Inc.		JPMorgan Chase Bank N.A.			22,000				02/08/19				USD				20.70				USD				518				(87,427	)
Bandwidth, Inc., Class A		Barclays Bank PLC			8,400				02/11/19				USD				46.87				USD				342				(8,051	)
Eventbrite, Inc., Class A		UBS AG			10,350				02/11/19				USD				30.34				USD				288				(19,013	)
UbiSoft Entertainment SA		Credit Suisse International			15,700				02/12/19				EUR				72.22				EUR				1,104				(55,644	)
Ping An Healthcare and Technology PLC		Morgan Stanley & Co. International PLC			118,500				02/13/19				HKD				37.02				HKD				3,262				(2,548	)
SOITEC SA		Goldman Sachs International			13,000				02/13/19				EUR				53.56				EUR				657				(32,497	)
Zendesk, Inc.		Credit Suisse International			16,400				02/13/19				USD				53.57				USD				957				(119,727	)
Altair Engineering, Inc., Class A		Citibank N.A.			29,400				02/14/19				USD				28.78				USD				811				(59,744	)
IAC/InterActiveCorp		JPMorgan Chase Bank N.A.			5,200				02/15/19				USD				186.17				USD				952				(52,730	)
Wirecard AG		Goldman Sachs International			3,800				02/20/19				EUR				140.81				EUR				500				(38,583	)
																												$	(1,736,989	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	4,240,574			$	(1,013,026	)		$	(4,702,879	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	4,702,879			$	—			$	—			$				$	4,702,879

 

 

86		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Schedule of Investments   (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

For the period ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(11,734	)		$	—			$	—			$	—			$	(11,734	)
Options written			—				—				(4,479,530	)			—				—				—				(4,479,530	)
		$	—			$	—			$	(4,491,264	)		$	—			$	—			$	—			$	(4,491,264	)
(a) Options purchased are included in net realized gain (loss) from investments.
Net Change in Unrealized Appreciation (Depreciation) on:
Options written		$	—			$	—				980,623			$	—			$	—			$	—			$	980,623

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	124
Average value of option contracts written		$	7,028,251

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

Derivative Financial Instruments — Offsetting as of Period End

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

 

		Assets				Liabilities
Options		$	—			$	4,702,879
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			—				(2,965,890	)
Total derivative assets and liabilities subject to an MNA		$	—			$	1,736,989

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged				Cash Collateral Pledged (a)				Net Amount of Derivative Liabilities  (b)
Barclays Bank PLC		$	24,630			$	—			$	—			$	(10,000	)		$	14,630
Citibank N.A.			114,665				—				—				(114,665	)			—
Credit Suisse International			199,932				—				—				—				199,932
Deutsche Bank AG			5,668				—				—				(5,668	)			—
Goldman Sachs International			609,893				—				—				(220,000	)			389,893
JPMorgan Chase Bank N.A.			192,828				—				—				(120,000	)			72,828
Morgan Stanley & Co. International PLC			85,203				—				—				(85,203	)			—
UBS AG			504,170				—				—				(230,000	)			274,170
		$	1,736,989			$	—			$	—			$	(785,536	)		$	951,453

 

(a)

Excess of collateral received from the individual counterparty is not shown for financial reporting purposes.

(b)

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

 

 

SCHEDULES OF INVESTMENTS			87

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Schedule of Investments   (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Automobiles		$	5,596,032			$	—			$	—			$	5,596,032
Communications Equipment			3,152,414				—				—				3,152,414
Diversified Consumer Services			4,473,306				—				—				4,473,306
Diversified Telecommunication Services			3,413,709				—				—				3,413,709
Electrical Equipment			3,789,510				—				—				3,789,510
Electronic Equipment, Instruments & Components			3,538,746				—				—				3,538,746
Entertainment			29,287,490				6,926,957				—				36,214,447
Health Care Technology			3,386,028				2,380,186				—				5,766,214
Household Durables			2,791,059				—				—				2,791,059
Interactive Media & Services			53,172,718				29,687,495				—				82,860,213
Internet & Direct Marketing Retail			54,619,765				11,757,053				211,760				66,588,578
IT Services			93,252,443				12,783,937				—				106,036,380
Semiconductors & Semiconductor Equipment			37,114,557				29,392,211				—				66,506,768
Software			152,652,516				11,106,609				—				163,759,125
Technology Hardware, Storage & Peripherals			17,236,092				—				—				17,236,092
Preferred Stocks			—				—				15,491,176				15,491,176
Short-Term Securities			4,738,937				—				—				4,738,937
Subtotal		$	472,215,322			$	104,034,448			$	15,702,936			$	591,952,706
Investments Valued at NAV(a)															1,710,081
Total Investments														$	593,662,787
Derivative Financial Instruments(b)
Liabilities:
Equity contracts		$	(2,643,524	)		$	(2,059,355	)		$	—			$	(4,702,879	)

 

(a)

As of December 31, 2018, certain of the Trust’s Investments were fair valued using net asset value (“NAV”) per share and have been excluded from the fair value hierarchy.

(b)

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

Transfers between Level 1 and Level 2 were as follows:

 

		Transfers out of Level 1 (a)				Transfers Into Level 2 (a)
Assets:
Long-Term Investments:
Common Stocks		$	(13,204,778	)		$	13,204,778

 

(a)

External pricing service used to reflect any significant market movements between the time the Trust valued such foreign securities and the earlier closing of foreign markets.

A reconciliation of Level 3 investments is presented when the Trust had a significant amount of Level 3 investments at the beginning and/or rend 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, 2017		$	—			$	14,005,465			$	14,005,465
Transfers into Level 3			—				—				—
Transfers out of Level 3			—				—				—
Accrued discounts/premiums			—				—				—
Net realized gain (loss)			—				—				—
Net change in unrealized appreciation (depreciation)(a)(b)			(1,786,676	)			885,806				(900,870	)
Purchases			1,998,436				6,492,862				8,491,298
Sales			—				(5,892,957	)			(5,892,957	)
Closing Balance, as of December 31, 2018		$	211,760			$	15,491,176			$	15,702,936
Net change in unrealized appreciation (depreciation) on investments still held at December 31, 2018(b)		$	(1,786,676	)		$	427,110			$	1,359,566

 

 

88		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments   (continued) December 31, 2018		BlackRock Science and Technology Trust (BST)

 

 

(a)

Included in the related net change in unrealized appreciation (depreciation) in the Statements of Operations.

(b)

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on derivative financial instruments still held at December 31, 2018 is generally due to derivative financial instruments no longer held or categorized as Level 3 at period end.

The following table summarizes the valuation approaches 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 period end. The table does not include Level 3 investments with values based upon unadjusted third party pricing information in the amount of $1. A significant change in the third party information could result in a significantly lower or higher value of such Level 3 investments.

 

Value

Valuation Approach

Unobservable Inputs

Range of unobservable Inputs Utilized

Weighted Avgerage of Unobservable Inputs

Assets:

Common Stocks

$

211,759

Market

Revenue Multiple(a)

6.25x

—

Preferred Stocks(b)

15,491,176

Market

Revenue Multiple(a)

3.50x – 6.50x

4.85x

Recent Transactions(a)

—

$

15,702,935

 

(a)

Increase in unobservable input may result in a significant increase to value, while a decrease in unobservable input may result in a significant decrease to value.

(b)

For the year ended December 31, 2018, the valuation technique for investments classified as preferred stocks amounting to $8,998,314 changed to Current Value. The investments were previously valued utilizing Transaction Price. The change was due to consideration of the information that was available at the time the investments were valued.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS			89

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Schedule of Investments   December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI) (Percentages shown are based on Net Assets)

 

(e)	During the year ended December 31, 2018, 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 Held at 12/31/17				Net Activity				Shares Held at 12/31/18				Value at 12/31/18				Income				Net Realized Gain (Loss) (a)				Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds, T-Fund, Institutional Class			6,376,831				3,420,968				9,797,799			$	9,797,799			$	83,607			$	—			$	—

 

(a)

Includes net capital gain distributions, if applicable.

 

 

90		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

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

Derivative Financial Instruments Outstanding as of Period End

Exchange-Traded Options Written

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
American Electric Power Co., Inc.			336				01/02/19			USD			78.50			USD			2,511			$	(2	)
Dominion Energy, Inc.			544				01/02/19			USD			76.50			USD			3,887				—
Duke Energy Corp.			550				01/02/19			USD			90.00			USD			4,747				(25	)
NextEra Energy, Inc.			300				01/02/19			USD			176.00			USD			5,215				(7,691	)
Pinnacle West Capital Corp.			182				01/02/19			USD			91.00			USD			1,551				—
Sempra Energy			350				01/02/19			USD			115.25			USD			3,787				—
Public Service Enterprise Group, Inc.			363				01/03/19			USD			54.75			USD			1,889				(46	)
Energy Transfer Partners LP			52				01/04/19			USD			15.00			USD			69				(260	)
Williams Cos., Inc.			47				01/04/19			USD			25.50			USD			104				(235	)
Williams Cos., Inc.			145				01/04/19			USD			27.25			USD			320				—
Enterprise Products Partners LP			23				01/11/19			USD			27.00			USD			57				(230	)
FirstEnergy Corp.			37				01/11/19			USD			39.23			USD			139				(361	)
Williams Cos., Inc.			32				01/11/19			USD			26.00			USD			71				(672	)
Williams Cos., Inc.			74				01/11/19			USD			25.01			USD			163				(10	)
Williams Cos., Inc.			47				01/11/19			USD			25.18			USD			104				(5	)
American Electric Power Co., Inc.			210				01/18/19			USD			80.00			USD			1,570				(3,150	)
DTE Energy Co.			161				01/18/19			USD			120.00			USD			1,776				(3,220	)
Dominion Energy, Inc.			618				01/18/19			USD			75.00			USD			4,416				(26,265	)
Duke Energy Corp.			272				01/18/19			USD			87.50			USD			2,347				(31,280	)
Enterprise Products Partners LP			46				01/18/19			USD			28.20			USD			113				(12	)
Eversource Energy			142				01/18/19			USD			70.00			USD			924				(4,260	)
Exelon Corp.			303				01/18/19			USD			46.00			USD			1,367				(14,393	)
FirstEnergy Corp.			112				01/18/19			USD			39.00			USD			421				(2,800	)
FirstEnergy Corp.			96				01/18/19			USD			40.00			USD			360				(960	)
Fortis, Inc.			250				01/18/19			USD			35.00			USD			834				(2,500	)
MPLX LP			41				01/18/19			USD			34.00			USD			124				(307	)
MPLX LP			130				01/18/19			USD			32.00			USD			394				(3,900	)
NextEra Energy, Inc.			479				01/18/19			USD			180.00			USD			8,326				(50,295	)
NiSource, Inc.			185				01/18/19			USD			26.00			USD			469				(6,938	)
ONEOK, Inc.			104				01/18/19			USD			62.50			USD			561				(2,080	)
PPL Corp.			201				01/18/19			USD			32.00			USD			569				(1,005	)
Public Service Enterprise Group, Inc.			250				01/18/19			USD			55.00			USD			1,301				(3,125	)
Sempra Energy			20				01/18/19			USD			115.00			USD			216				(850	)
Targa Resources Corp.			115				01/18/19			USD			39.00			USD			414				(4,888	)
TransCanada Corp.			443				01/18/19			CAD			54.00			CAD			2,160				(2,434	)
WEC Energy Group, Inc.			122				01/18/19			USD			70.00			USD			845				(13,115	)
Williams Cos., Inc.			135				01/18/19			USD			26.00			USD			298				(473	)
Williams Cos., Inc.			73				01/18/19			USD			25.00			USD			161				(365	)
Energy Transfer Partners LP			156				01/25/19			USD			13.50			USD			206				(7,020	)
Enterprise Products Partners LP			35				01/25/19			USD			27.00			USD			86				(525	)
FirstEnergy Corp.			141				01/25/19			USD			39.27			USD			529				(3,599	)
ONEOK, Inc.			104				01/25/19			USD			61.00			USD			561				(3,640	)
Texas Instruments, Inc.			60				01/25/19			USD			97.50			USD			567				(15,660	)
Williams Cos., Inc.			343				01/25/19			USD			25.00			USD			756				(2,230	)
Williams Cos., Inc.			33				01/25/19			USD			26.02			USD			73				(251	)
PPL Corp.			200				01/29/19			USD			29.05			USD			567				(10,353	)
WEC Energy Group, Inc.			123				01/29/19			USD			72.46			USD			852				(6,613	)
CMS Energy Corp.			446				01/31/19			USD			51.50			USD			2,214				(24,552	)
Duke Energy Corp.			80				01/31/19			USD			91.00			USD			690				(4,117	)
FirstEnergy Corp.			73				01/31/19			USD			38.25			USD			274				(4,665	)
NextEra Energy, Inc.			180				01/31/19			USD			178.00			USD			3,129				(40,487	)
Energy Transfer Partners LP			156				02/01/19			USD			13.50			USD			206				(8,502	)
Enterprise Products Partners LP			318				02/01/19			USD			26.00			USD			782				(6,360	)
FirstEnergy Corp.			37				02/01/19			USD			39.93			USD			139				(792	)
Texas Instruments, Inc.			60				02/01/19			USD			97.50			USD			567				(17,460	)

 

 

SCHEDULES OF INVESTMENTS			91

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Schedule of Investments  (continued) December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Exchange-Traded Options Written (continued)

 

Description		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Johnson Controls International PLC			177				02/08/19			USD			34.00			USD			525			$	(1,656	)
FirstEnergy Corp.			141				02/11/19			USD			38.20			USD			529				(11,522	)
FirstEnergy Corp.			73				02/11/19			USD			38.25			USD			274				(4,689	)
Eversource Energy			139				02/15/19			USD			68.00			USD			904				(11,036	)
Johnson Controls International PLC			89				02/15/19			USD			32.00			USD			264				(4,539	)
Williams Cos., Inc.			228				02/15/19			USD			26.00			USD			503				(5,586	)
Williams Cos., Inc.			343				02/15/19			USD			25.00			USD			756				(8,061	)
Williams Cos., Inc.			510				02/15/19			USD			24.00			USD			1,125				(18,870	)
Williams Cos., Inc.			1				02/15/19			USD			22.00			USD			2				(110	)
Johnson Controls International PLC			88				02/22/19			USD			33.00			USD			261				(2,755	)
																						$	(413,802	)

OTC Options Written

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price						Notional Amount (000)						Value
Call
Exelon Corp.		Bank of America N.A.			65,000				01/02/19			USD			46.75			USD			2,932			$	(60	)
NiSource, Inc.		Citibank N.A.			42,000				01/02/19			USD			26.75			USD			1,065				(82	)
Public Service Enterprise Group, Inc.		Barclays Bank PLC			45,000				01/02/19			USD			53.5			USD			2,342				(655	)
EDP Renovaveis SA		UBS AG			40,000				01/03/19			EUR			7.93			EUR			313				(1,415	)
Schneider Electric SE		Barclays Bank PLC			5,900				01/04/19			EUR			65.58			EUR			349				(1	)
Sempra Energy		Citibank N.A.			10,100				01/04/19			USD			116.01			USD			1,093				(30	)
Enterprise Products Partners LP		Bank of America N.A.			3,400				01/08/19			USD			27.16			USD			84				(3	)
Exelon Corp.		JPMorgan Chase Bank N.A.			24,000				01/08/19			USD			46.13			USD			1,082				(4,482	)
Atlantia SpA		Goldman Sachs International			78,500				01/09/19			EUR			18.38			EUR			1,418				(16,398	)
China Longyuan Power Group Corp. Ltd., Class H		Citibank N.A.			1,267,000				01/09/19			HKD			6.18			HKD			6,778				(55	)
EDP Renovaveis SA		Citibank N.A.			25,000				01/09/19			EUR			7.97			EUR			196				(441	)
EDP Renovaveis SA		UBS AG			40,000				01/09/19			EUR			7.97			EUR			313				(717	)
Infineon Technologies AG		Morgan Stanley & Co. International PLC			23,100				01/09/19			EUR			18.28			EUR			404				(5,087	)
Enel SpA		Credit Suisse International			729,200				01/10/19			EUR			4.75			EUR			3,690				(269,348	)
National Grid PLC		Credit Suisse International			193,900				01/10/19			GBP			8.55			GBP			1,489				(761	)
Transurban Group		Citibank N.A.			147,100				01/11/19			AUD			11.72			AUD			1,714				(11,818	)
Enbridge, Inc.		Barclays Bank PLC			61,500				01/15/19			USD			32.99			USD			1,911				(7,266	)
Xcel Energy, Inc.		Citibank N.A.			24,900				01/15/19			USD			49.98			USD			1,227				(12,912	)
EDP Renovaveis SA		Morgan Stanley & Co. International PLC			40,000				01/16/19			EUR			7.97			EUR			313				(3,143	)
Getlink SE		Goldman Sachs International			53,300				01/16/19			EUR			11.66			EUR			625				(16,869	)
Linde PLC		Goldman Sachs International			9,200				01/16/19			EUR			142.81			EUR			1,275				(18,066	)
Kingspan Group PLC		UBS AG			25,200				01/17/19			EUR			40.41			EUR			943				(5,325	)
Schneider Electric SE		Goldman Sachs International			5,900				01/17/19			EUR			65.60			EUR			349				(362	)
China Longyuan Power Group Corp. Ltd., Class H		JPMorgan Chase Bank N.A.			1,074,000				01/23/19			HKD			6.13			HKD			5,746				(2,581	)
EDP Renovaveis SA		Credit Suisse International			25,000				01/23/19			EUR			7.82			EUR			196				(4,030	)
Enel SpA		Goldman Sachs International			158,500				01/24/19			EUR			4.97			EUR			802				(17,738	)
Iberdrola SA		Credit Suisse International			38,100				01/24/19			EUR			6.90			EUR			267				(6,570	)
National Grid PLC		Goldman Sachs International			106,100				01/24/19			GBP			8.53			GBP			815				(3,952	)
Vestas Wind Systems A/S		Goldman Sachs International			33,000				01/24/19			DKK			515.62			DKK			16,279				(33,926	)
EDP Renovaveis SA		Credit Suisse International			30,000				01/25/19			EUR			7.84			EUR			235				(4,825	)
EDP Renovaveis SA		UBS AG			30,000				01/25/19			EUR			7.84			EUR			235				(4,829	)
Air Liquide SA		Goldman Sachs International			3,300				01/29/19			EUR			107.41			EUR			358				(12,943	)
Air Liquide SA		Goldman Sachs International			7,900				01/29/19			EUR			108.56			EUR			856				(20,865	)
EDP Renovaveis SA		Credit Suisse International			40,000				01/29/19			EUR			7.69			EUR			313				(10,701	)
EDP Renovaveis SA		Credit Suisse International			25,000				01/29/19			EUR			7.82			EUR			196				(4,610	)
Infineon Technologies AG		Goldman Sachs International			23,500				01/29/19			EUR			18.77			EUR			411				(9,035	)
Kone OYJ, Class B		Goldman Sachs International			13,300				01/29/19			EUR			43.17			EUR			554				(8,351	)
Iberdrola SA		Morgan Stanley & Co. International PLC			36,000				01/30/19			EUR			7.00			EUR			252				(4,215	)
ABB Ltd., Registered Shares		Morgan Stanley & Co. International PLC			54,100				01/31/19			CHF			20.22			CHF			1,015				(4,220	)
EDP Renovaveis SA		Credit Suisse International			30,000				01/31/19			EUR			7.84			EUR			235				(5,199	)
Enel SpA		UBS AG			200,000				01/31/19			EUR			5.14			EUR			1,012				(7,999	)
Exelon Corp.		Bank of America N.A.			10,000				01/31/19			USD			46.76			USD			451				(4,233	)
Fortis, Inc.		Barclays Bank PLC			25,400				01/31/19			USD			35.02			USD			847				(4,383	)

 

 

92		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

OTC Options Written (continued)

 

Description		Counterparty		Number of Contracts				Expiration Date				Exercise Price								Notional Amount (000)								Value
Call (continued)
Suncor Energy, Inc.		UBS AG			15,100				01/31/19				EUR				62.83				EUR				894			$	(11,041	)
TransCanada Corp.		Deutsche Bank AG			22,200				01/31/19				CAD				51.91				CAD				1,082				(3,628	)
EDP Renovaveis SA		Credit Suisse International			20,000				02/05/19				EUR				7.70				EUR				157				(5,557	)
National Grid PLC		Credit Suisse International			134,400				02/05/19				GBP				8.61				GBP				1,032				(7,429	)
Atlantia SpA		Credit Suisse International			60,400				02/06/19				EUR				18.11				EUR				1,091				(31,652	)
Getlink SE		Citibank N.A.			47,500				02/06/19				EUR				12.13				EUR				557				(9,595	)
Infineon Technologies AG		Goldman Sachs International			14,000				02/06/19				EUR				18.58				EUR				245				(8,511	)
Kone OYJ, Class B		Goldman Sachs International			13,300				02/06/19				EUR				43.17				EUR				554				(10,064	)
Suncor Energy, Inc.		UBS AG			5,900				02/06/19				EUR				61.95				EUR				349				(6,674	)
Enbridge, Inc.		Citibank N.A.			26,000				02/11/19				USD				32.60				USD				808				(15,722	)
EDP Renovaveis SA		Credit Suisse International			20,000				02/12/19				EUR				7.87				EUR				157				(3,873	)
ABB Ltd., Registered Shares		Credit Suisse International			32,700				02/13/19				CHF				19.56				CHF				614				(9,284	)
Air Liquide SA		Credit Suisse International			5,200				02/13/19				EUR				108.01				EUR				564				(18,286	)
China Longyuan Power Group Corp. Ltd., Class H		JPMorgan Chase Bank N.A.			1,310,000				02/13/19				HKD				5.61				HKD				7,009				(26,907	)
China Longyuan Power Group Corp. Ltd., Class H		JPMorgan Chase Bank N.A.			855,000				02/13/19				HKD				5.51				HKD				4,574				(21,943	)
Iberdrola SA		UBS AG			210,600				02/13/19				EUR				7.07				EUR				1,476				(25,500	)
Kingspan Group PLC		UBS AG			3,300				02/13/19				EUR				37.07				EUR				123				(7,960	)
Linde PLC		Credit Suisse International			3,300				02/13/19				EUR				140.01				EUR				457				(20,757	)
TransCanada Corp.		UBS AG			242,400				02/13/19				AUD				11.73				AUD				2,824				(38,057	)
NiSource, Inc.		Barclays Bank PLC			18,500				02/14/19				USD				26.45				USD				469				(11,689	)
EDP Renovaveis SA		Goldman Sachs International			20,000				02/20/19				EUR				7.87				EUR				157				(4,211	)
																												$	(848,841	)

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

 

		Swap Premium Paid				Swap Premium Received				Unrealized Appreciation				Unrealized Depreciation				Value
Options Written			N/A				N/A			$	1,469,017			$	(273,551	)		$	(1,262,643	)

Derivative Financial Instruments Categorized by Risk Exposure

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

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Liabilities — Derivative Financial Instruments
Options written
Options written, at value		$	—			$	—			$	1,262,643			$	—			$	—			$	—			$	1,262,643

For the year ended December 31, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

		Commodity Contracts				Credit Contracts				Equity Contracts				Foreign Currency Exchange Contracts				Interest Rate Contracts				Other Contracts				Total
Net Realized Gain (Loss) from:
Options purchased(a)		$	—			$	—			$	(713	)		$	—			$	—			$	—			$	(713	)
Options written			—				—				(250,333	)			—				—				—				(250,333	)
		$	—			$	—			$	(251,046	)		$	—			$	—			$	—			$	(251,046	)

 

(a)

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

 

Net Change in Unrealized Appreciation (Depreciation) on:
Options purchased(a)		$	—			$	—			$	(547	)		$	—			$	—			$	—			$	(547	)
Options written			—				—				463,238				—				—				—				463,238
		$	—			$	—			$	462,691			$	—			$	—			$	—			$	462,691

 

(a)

Includes options purchased at value as reported in the Schedule of Investments.

 

 

SCHEDULES OF INVESTMENTS			93

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Schedule of Investments  (continued) December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Options:
Average value of option contracts purchased		$	—	(a)
Average value of option contracts written		$	2,340,666

 

(a)

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

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

Derivative Financial Instruments — Offsetting as of Period End

The Trust’s derivative asset and liabilities (by type) are as follows:

 

		Assets				Liabilities
Derivative Financial Instruments
Options		$	—			$	1,262,643
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)			—				(413,802	)
Total derivative assets and liabilities subject to an MNA		$	—			$	848,841

The following table presents the Trust’s 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 Trust:

 

Counterparty		Derivative Liabilities Subject to an MNA by Counterparty				Derivatives Available for Offset				Non-cash Collateral Pledged (a)				Cash Collateral Pledged				Net Amount of Derivative Liabilities  (b)
Bank of America N.A.		$	4,296			$	—			$	—			$	—			$	4,296
Barclays Bank PLC			23,994				—				(2,661	)			—				21,333
Citibank N.A.			50,655				—				(50,655	)			—				—
Credit Suisse International			402,882				—				(402,882	)			—				—
Deutsche Bank AG			3,628				—				—				—				3,628
Goldman Sachs International			181,291				—				—				—				181,291
JPMorgan Chase Bank N.A.			55,913				—				(55,913	)			—				—
Morgan Stanley & Co. International PLC			16,665				—				(16,665	)			—				—
UBS AG			109,517								(109,517	)							—
		$	848,841			$	—			$	(638,293	)		$	—			$	210,548

 

(a)

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

(b)

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

 

 

94		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Schedule of Investments  (continued) December 31, 2018		BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Fair Value Hierarchy as of Period End

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

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:
Common Stocks:
Building Products		$	3,004,108			$	3,491,553			$	—			$	6,495,661
Chemicals			5,687,308				5,852,269				—				11,539,577
Electric Utilities			96,217,865				24,547,869				—				120,765,734
Electrical Equipment			—				18,221,345				—				18,221,345
Independent Power and Renewable Electricity Producers			—				22,835,992				—				22,835,992
Machinery			—				3,218,102				—				3,218,102
Multi-Utilities			48,634,697				12,144,758				—				60,779,455
Oil, Gas & Consumable Fuels			39,956,859				—				—				39,956,859
Semiconductors & Semiconductor Equipment			3,219,615				3,469,334				—				6,688,949
Transportation Infrastructure			—				19,519,740				—				19,519,740
Short-Term Securities			9,797,799				—				—				9,797,799
		$	206,518,251			$	113,300,962			$	—			$	319,819,213
Derivative Financial Instruments(a)
Liabilities:
Equity contracts		$	(278,563	)		$	(984,080	)		$	—			$	(1,262,643	)

 

(a)

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

Transfers between Level 1 and Level 2 were as follows:

 

		Transfers out of Level 1 (a)				Transfers into Level 2 (a)
Assets:
Long-Term Investments:
Common Stocks		$	19,523,912			$	19,523,912

 

(a)

External pricing service used to reflect any significant market movements between the time the Trust valued such foreign securities and the earlier closing of foreign markets.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS			95

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Statements of Assets and Liabilities

December 31, 2018

 

		BGR				CII				BDJ				BOE				BGY
ASSETS
Investments at value — unaffiliated(a)		$	353,876,843			$	673,859,119			$	1,603,681,857			$	734,460,465			$	594,427,744
Investments at value — affiliated(b)			5,006,975				14,789,354				44,526,058				19,702,446				25,489,943
Cash			—				45,145				43,458				—				—
Cash pledged:
Collateral — options written			—				—				—				2,785,000				4,136,000
Collateral — OTC derivatives			—				—				—				—				201,000
Foreign currency at value(c)			6,459				—				1,544				605,135				805,970
Receivables:
Dividends — unaffiliated			616,588				874,433				2,054,113				3,288,960				3,215,587
Dividends — affiliated			9,034				13,859				81,995				11,118				—
Investments sold			—				—				675,095				—				—
Prepaid expenses			—				7,383				7,012				528				—
Total assets			359,515,899				689,589,293				1,651,071,132				760,853,652				628,276,244
LIABILITIES
Bank overdraft			23,035				—				—				—				—
Options written at value(d)			1,051,873				3,567,851				9,021,122				3,609,231				2,991,651
Payables:
Trustees’ and Officer’s fees			448,935				191,886				890,083				644,735				557,865
Investment advisory fees			331,773				499,475				1,137,213				541,843				483,214
Income dividend distributions			168,843				211,125				327,147				196,726				199,228
Other accrued expenses			100,866				95,350				247,186				174,240				142,952
Capital shares redeemed			—				—				—				1,085,316				666,884
Investments purchased			—				10,946,660				1,211,873				—				—
Total liabilities			2,125,325				15,512,347				12,834,624				6,252,091				5,041,794
NET ASSETS		$	357,390,574			$	674,076,946			$	1,638,236,508			$	754,601,561			$	623,234,450
NET ASSETS CONSIST OF
Paid-in capital		$	579,907,704				577,671,748			$	1,320,628,954			$	822,989,040			$	673,322,419
Accumulated earnings (loss)			(222,517,130	)			96,405,198				317,607,554				(68,387,479	)			(50,087,969	)
NET ASSETS		$	357,390,574			$	674,076,946			$	1,638,236,508			$	754,601,561			$	623,234,450
Net asset value(e)(f)		$	11.98			$	15.28			$	8.74			$	11.07			$	5.79
(a) Investments at cost — unaffiliated		$	409,332,240			$	578,317,081			$	1,404,953,813			$	801,861,897			$	662,351,547
(b) Investments at cost — affiliated		$	5,006,975			$	14,789,354			$	44,526,058			$	19,702,446			$	25,489,943
(c) Foreign currency at cost		$	6,476			$	—			$	1,656			$	608,474			$	804,969
(d) Premiums received		$	3,557,927			$	8,128,325			$	22,402,546			$	7,395,565			$	5,889,810
(e) Shares outstanding, unlimited number of shares authorized, $0.001 par value			29,825,326				—				187,542,405				68,183,726				107,706,596
(f)  Shares outstanding, 200 million shares authorized, $0.10 par value			—				44,121,400				—				—				—

See notes to financial statements.

 

 

96		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Statements of Assets and Liabilities  (continued)

December 31, 2018

 

		BME				BCX(a)				BST				BUI
ASSETS
Investments at value — unaffiliated(b)(c)		$	328,602,596			$	788,938,343			$	587,213,769			$	310,021,414
Investments at value — affiliated(d)			25,972,185				13,928,859				6,449,018				9,797,799
Cash			—				43,980				21,377				—
Cash pledged:
Collateral — options written			—				—				1,160,000				—
Foreign currency at value(e)			288				201,317				1,920				57
Receivables:
Dividends — unaffiliated			304,993				1,696,089				40,287				874,335
Dividends — affiliated			47,051				36,090				19,929				10,991
Investments sold			—				—				—				—
Capital shares sold			485,404				—				—				—
Securities lending income — affiliated			77				2,048				3,998				—
Deferred offering costs			72,887				—				—				—
Total assets			355,485,481				804,846,726				594,910,298				320,704,596
LIABILITIES
Cash collateral on securities loaned at value			4,675				273,985				1,710,283				—
Bank overdraft			—				—				—				126,775
Options written at value(f)			1,418,657				3,911,872				4,702,879				1,262,643
Payables:
Trustees’ and Officer’s fees			26,831				298,779				16,598				7,666
Investment advisory fees			302,862				690,418				404,629				268,900
Income dividend distributions			—				202,084				—				—
Other accrued expenses			104,896				173,671				168,224				105,350
Capital shares redeemed			—				833,693				—				—
Investments purchased			928,582				—				—				—
Options written			—				180,565				—				—
Offering costs			24,000				—				—				—
Total liabilities			2,810,503				6,565,067				7,002,613				1,771,334
NET ASSETS		$	352,674,978			$	798,281,659			$	587,907,685			$	318,933,262
NET ASSETS CONSIST OF
Paid-in capital		$	252,975,053			$	1,222,624,533			$	346,251,639			$	282,463,770
Accumulated earnings (loss)			99,699,925				(424,342,874	)			241,656,046				36,469,492
NET ASSETS		$	352,674,978			$	798,281,659			$	587,907,685			$	318,933,262
Net asset value(g)		$	35.87			$	8.44			$	26.21			$	18.77
(a) Consolidated Statement of Assets and Liabilities
(b) Investments at cost — unaffiliated		$	227,730,187			$	799,134,020			$	368,513,355			$	265,857,568
(c) Securities loaned at value		$	4,492			$	218,010			$	1,629,459			$	—
(d) Investments at cost — affiliated		$	25,972,185			$	13,928,888			$	6,449,185			$	9,797,799
(e) Foreign currency at cost		$	290			$	201,278			$	2,008			$	77
(f)  Premiums received		$	2,535,639			$	8,168,042			$	7,930,427			$	2,458,109
(g) Shares outstanding, unlimited number of shares authorized, $0.001 par value			9,831,018				94,545,128				22,431,578				16,987,292

See notes to financial statements.

 

 

FINANCIAL STATEMENTS			97

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Statements of Operations

Year Ended December 31, 2018

 

		BGR				CII				BDJ				BOE				BGY
INVESTMENT INCOME
Dividends — unaffiliated		$	14,416,043			$	14,354,718			$	50,036,765	(a)		$	30,503,574			$	27,100,164	(a)
Dividends — affiliated			78,939				80,954				262,280				99,772				103,479
Securities lending income — affiliated — net			—				13,698				822				—				—
Foreign taxes withheld			(960,071	)			(120,998	)			(1,023,986	)			(1,466,611	)			(2,006,460	)
Total investment income			13,534,911				14,328,372				49,275,881				29,136,735				25,197,183
EXPENSES
Investment advisory			5,392,331				6,415,332				14,604,116				8,418,841				7,052,295
Professional			87,174				97,421				188,388				135,370				122,581
Transfer agent			82,536				64,283				201,168				124,970				109,112
Custodian			58,761				20,560				188,831				116,747				105,684
Accounting services			39,492				34,519				89,484				54,484				44,508
Printing			13,432				10,127				21,408				13,730				16,075
Registration			11,521				17,044				72,446				26,662				42,167
Trustees and Officer			—				50,517				60,332				—				694
Rating agency			4,833				4,833				4,833				4,833				4,833
Miscellaneous			118,554				49,937				107,001				162,299				160,061
Total expenses			5,808,634				6,764,573				15,538,007				9,057,936				7,658,010
Less
Fees waived and/or reimbursed by the Manager			(677,220	)			(3,200	)			(9,782	)			(1,155,343	)			(709,713	)
Total expenses after fees waived and/or reimbursed			5,131,414				6,761,373				15,528,225				7,902,593				6,948,297
Net investment income			8,403,497				7,566,999				33,747,656				21,234,142				18,248,886
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments — unaffiliated			9,776,298				35,499,497				136,758,768				1,990,590				82,423,024	(b)
Investments — affiliated			—				(97	)			(51	)			—				—
Foreign currency transactions			(57,169	)			(4,456	)			(53,910	)			106,169				(154,102	)
Payments from affiliates			—				—				6,782	(c)			—				243,859	(c)
Options written			(5,634,691	)			(368,218	)			(5,219,539	)			(1,712,691	)			2,536,527
			4,084,438				35,126,726				131,492,050				384,068				85,049,308
Net change in unrealized appreciation (depreciation) on:
Investments — unaffiliated			(105,235,675	)			(89,764,592	)			(307,843,866	)			(116,551,084	)(d)			(195,741,687	)(d)
Investments — affiliated			—				—				—				—				—
Foreign currency translations			(6,247	)			—				(3,245	)			(69,241	)			(79,306	)
Options written			6,855,978				6,586,567				17,485,572				3,709,364				1,313,824
			(98,385,944	)			(83,178,025	)			(290,361,539	)			(112,910,961	)			(194,507,169	)
Net realized and unrealized gain (loss)			(94,301,506	)			(48,051,299	)			(158,869,489	)			(112,526,893	)			(109,457,861	)
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS		$	(85,898,009	)		$	(40,484,300	)		$	(125,121,833	)		$	(91,292,751	)		$	(91,208,975	)

 

(a)	Including non-recurring dividends.

(b)	Net of $ (211,516) foreign capital gain tax.

(c)	Includes payments from affiliates of $6,782 and $243,859, respectively to compensate for a trade operating event.

(d)	Including $(12,332) and $(116,814) unrealized foreign capital gain tax.

See notes to financial statements.

 

 

98		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Statements of Operations  (continued)

Year Ended December 31, 2018

 

		BME				BCX(a)				BST				BUI
INVESTMENT INCOME
Dividends — unaffiliated		$	4,389,432			$	31,737,544			$	2,895,390			$	12,515,728
Dividends — affiliated			215,966				186,529				182,611				83,607
Securities lending income — affiliated — net			1,757				16,485				159,000				—
Interest — unaffiliated			—				1,319,958				—				—
Foreign taxes withheld			(72,294	)			(2,137,343	)			(152,303	)			(537,751	)
Total investment income			4,534,861				31,123,173				3,084,698				12,061,584
EXPENSES
Investment advisory			3,505,218				9,563,661				6,742,741				3,398,053
Professional			104,767				136,192				129,651				96,522
Transfer agent			51,238				125,610				80,633				55,226
Custodian			101,788				125,585				174,093				51,690
Accounting services			24,499				54,484				44,508				44,508
Printing			14,632				16,885				17,913				13,092
Registration			11,772				37,324				9,423				12,040
Directors and Officer			30,925				54,257				66,460				31,728
Rating agency			4,833				19,583				4,833				19,583
Miscellaneous			38,391				223,770				93,785				78,226
Total expenses			3,888,063				10,357,351				7,364,040				3,800,668
Less
Fees waived and/or reimbursed by the Manager			(8,521	)			(7,702	)			(1,355,178	)			(88,356	)
Total expenses after fees waived and/or reimbursed and paid indirectly			3,879,542				10,349,649				6,008,862				3,712,312
Net investment income (loss)			655,319				20,773,524				(2,924,164	)			8,349,272
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments — unaffiliated			27,352,423				43,431,253				70,235,655				6,930,616
Investments — affiliated			1				—				(842	)			—
Foreign currency transactions			(4,179	)			319,704				(11,769	)			(92,102	)
Payment from affiliate			—				—				—				—
Options written			(4,052,692	)			(1,950,043	)			(4,479,530	)			(250,333	)
			23,295,553				41,800,914				65,743,514				6,588,181
Net change in unrealized appreciation (depreciation) on:
Investments — unaffiliated			(2,420,630	)			(227,844,890	)			(58,583,503	)			(30,538,052	)
Investments — affiliated			7				10				2				—
Foreign currency translations			(1,186	)			(10,270	)			(583	)			(12,398	)
Options written			912,695				12,466,021				980,623				463,238
			(1,509,114	)			(215,389,129	)			(57,603,461	)			(30,087,212	)
Net realized and unrealized gain (loss)			21,786,439				(173,588,215	)			8,140,053				(23,499,031	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		$	22,441,758			$	(152,814,691	)		$	5,215,889			$	(15,149,759	)

 

(a)	Consolidated Statement of Operations.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS			99

---

Statements of Changes in Net Assets

 

		BGR												CII
		Year Ended December 31,												Year Ended December 31,
		2018				2017								2018				2017
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income		$	8,403,497			$	12,016,029							$	7,566,999			$	6,643,909
Net realized gain			4,084,438				240,009								35,126,726				10,582,824
Net change in unrealized appreciation (depreciation)			(98,385,944	)			(484,738	)							(83,178,025	)			119,853,112
Net increase (decrease) in net assets resulting from operations			(85,898,009	)			11,771,300								(40,484,300	)			137,079,845
DISTRIBUTIONS TO SHAREHOLDERS(a)(b)
From net investment income and net realized gain			(8,135,490	)			(12,093,542	)							(19,927,105	)			(6,682,172	)
From return of capital			(19,637,853	)			(15,679,802	)							(23,911,918	)			(37,156,851	)
Decrease in net assets resulting from distributions to shareholders			(27,773,343	)			(27,773,344	)							(43,839,023	)			(43,839,023	)
NET ASSETS(b)
Total increase (decrease) in net assets			(113,671,352	)			(16,002,044	)							(84,323,323	)			93,240,822
Beginning of year			471,061,926				487,063,970								758,400,269				665,159,447
End of year		$	357,390,574			$	471,061,926							$	674,076,946			$	758,400,269

 

(a)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b)	Prior year distribution character information and undistributed (distributions in excess of) net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

100		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Statements of Changes in Net Assets  (continued)

 

		BDJ												BOE
		Year Ended December 31,												Year Ended December 31,
		2018				2017								2018				2017
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income		$	33,747,656			$	30,942,206							$	21,234,142			$	11,728,245
Net realized gain			131,492,050				191,391,199								384,068				188,939,188
Net change in unrealized appreciation (depreciation)			(290,361,539	)			22,107,356								(112,910,961	)			(54,178,546	)
Net increase (decrease) in net assets resulting from operations			(125,121,833	)			244,440,761								(91,292,751	)			146,488,887
DISTRIBUTIONS TO SHAREHOLDERS(a)(b)
From net investment income and net realized gain			(105,098,764	)			(105,360,386	)							(56,899,700	)			(157,730,436	)
From return of capital			—				—								(1,381,549	)			—
Decrease in net assets resulting from distributions to shareholders			(105,098,764	)			(105,360,386	)							(58,281,249	)			(157,730,436	)
CAPITAL SHARE TRANSACTIONS
Redemption of shares resulting from share repurchase program (including transaction costs)			—				(12,272,105	)							(7,051,296	)			(7,428,758	)
NET ASSETS(b)
Total increase (decrease) in net assets			(230,220,597	)			126,808,270								(156,625,296	)			(18,670,307	)
Beginning of year			1,868,457,105				1,741,648,835								911,226,857				929,897,164
End of year		$	1,638,236,508			$	1,868,457,105							$	754,601,561			$	911,226,857

 

(a)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b)	Prior year distribution character information and distributions in excess of net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS			101

---

Statements of Changes in Net Assets  (continued)

 

		BGY												BME
		Year Ended December 31,												Year Ended December 31,
		2018				2017								2018				2017
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income		$	18,248,886			$	9,657,720							$	655,319			$	184,052
Net realized gain			85,049,308				20,853,143								23,295,553				16,290,255
Net change in unrealized appreciation (depreciation)			(194,507,169	)			104,149,768								(1,509,114	)			43,865,227
Net increase (decrease) in net assets resulting from operations			(91,208,975	)			134,660,631								22,441,758				60,339,534
DISTRIBUTIONS TO SHAREHOLDERS(a)(b)
From net investment income and net realized gain			(48,308,022	)			(9,780,974	)							(22,690,477	)			(19,381,806	)
From return of capital			—				(40,102,438	)							—				(2,234,310	)
Decrease in net assets resulting from distributions to shareholders			(48,308,022	)			(49,883,412	)							(22,690,477	)			(21,616,116	)
CAPITAL SHARE TRANSACTIONS
Proceeds from the issuance of shares (including deferred offering costs)			—				—								19,980,202				20,787,792
Reinvestment of common distributions			—				—								1,085,098				1,653,765
Redemption of shares resulting from share repurchase program (including transaction costs)			(6,926,639	)			(5,726,813	)							—				—
Net increase in net assets derived from capital share transactions			(6,926,639	)			(5,726,813	)							21,065,300				22,441,557
NET ASSETS(b)
Total increase (decrease) in net assets			(146,443,636	)			79,050,406								20,816,581				61,164,975
Beginning of year			769,678,086				690,627,680								331,858,397				270,693,422
End of year		$	623,234,450			$	769,678,086							$	352,674,978			$	331,858,397

 

(a)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b)	Prior year distribution character information and undistributed distributions in excess of net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

102		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Statements of Changes in Net Assets  (continued)

 

		BCX(a)												BST
		Year Ended December 31,												Year Ended December 31,
		2018				2017								2018				2017
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income		$	20,773,524			$	19,831,605							$	(2,924,164	)		$	(1,073,646	)
Net realized gain			41,800,914				40,599,529								65,743,514				18,280,612
Net change in unrealized appreciation (depreciation)			(215,389,129	)			71,294,123								(57,603,461	)			182,129,520
Net increase (decrease) in net assets resulting from operations			(152,814,691	)			131,725,257								5,215,889				199,336,486
DISTRIBUTIONS TO SHAREHOLDERS(b)(c)
From net investment income and net realized gain			(17,715,545	)			(23,004,937	)							(39,423,699	)			(6,142,466	)
From return of capital			(41,596,743	)			(36,309,489	)							—				(22,536,962	)
Decrease in net assets resulting from distributions to shareholders			(59,312,288	)			(59,314,426	)							(39,423,699	)			(28,679,428	)
CAPITAL SHARE TRANSACTIONS
Proceeds from the issuance of shares (including deferred offering costs)			—				—								—				(2,799,570	)
Reinvestment of common distributions			—				—								1,815,026				—
Redemption of shares resulting from share repurchase program (including transaction costs)			(17,063,427	)			(21,837,878	)							—				—
Net decrease in net assets derived from capital share transactions			(17,063,427	)			(21,837,878	)							1,815,026				(2,799,570	)
NET ASSETS(c)
Total increase (decrease) in net assets			(229,190,406	)			50,572,953								(32,392,784	)			167,857,488
Beginning of year			1,027,472,065				976,899,112								620,300,469				452,442,981
End of year		$	798,281,659			$	1,027,472,065							$	587,907,685			$	620,300,469

 

(a)	Consolidated Statements of Changes in Net Assets.

(b)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c)	Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS			103

---

Statements of Changes in Net Assets  (continued)

 

		BUI
		Year Ended December 31,
		2018				2017
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income		$	8,349,272			$	9,484,921
Net realized gain			6,588,181				20,594,890
Net change in unrealized appreciation (depreciation)			(30,087,212	)			23,259,316
Net increase (decrease) in net assets resulting from operations			(15,149,759	)			53,339,127
DISTRIBUTIONS TO SHAREHOLDERS (a)(b)
From net investment income and net realized gain			(24,524,104	)			(24,568,104	)
From return of capital			(98,239	)			—
Decrease in net assets resulting from distributions to shareholders			(24,622,343	)			(24,568,104	)
CAPITAL SHARE TRANSACTIONS
Reinvestment of common distributions			928,907				708,672
NET ASSETS(b)
Total increase (decrease) in net assets			(38,843,195	)			29,479,695
Beginning of year			357,776,457				328,296,762
End of year		$	318,933,262			$	357,776,457

 

(a)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b)	Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

104		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

---

Statements of Cash Flows

Year Ended December 31, 2018

 

		BGR				CII				BDJ				BOE				BGY
CASH PROVIDED BY OPERATING ACTIVITIES
Net increase (decrease) in net assets resulting from operations		$	(85,898,009	)		$	(40,484,300	)		$	(125,121,833	)		$	(91,292,751	)		$	(91,208,975	)
Adjustments to reconcile net decrease in net assets resulting from operations to net cash provided by (used for) operating activities:
Proceeds from sales of long-term investments			171,601,891				242,568,042				729,991,418				286,591,506				476,163,578
Purchases of long-term investments			(145,174,257	)			(194,539,187	)			(617,126,603	)			(232,972,642	)			(420,602,594	)
Net sales (purchases) of short-term securities			(1,136,131	)			(11,646,380	)			(39,558,869	)			(6,583,922	)			(20,416,244	)
Premiums received from options written			28,131,515				67,945,813				159,250,256				53,306,284				41,899,588
Premiums paid on closing options written			(33,647,521	)			(67,802,100	)			(161,054,284	)			(54,630,511	)			(39,605,509	)
Net realized gain (loss) on investments and options written			(4,141,591	)			(34,960,385	)			(131,402,132	)			173,573				(84,850,416	)
Net unrealized depreciation on investments, options written and foreign currency translations			98,379,697				83,178,025				290,358,294				112,841,720				194,427,863
(Increase) Decrease in Assets:
Receivables:
Dividends — affiliated			(4,970	)			(9,656	)			(76,789	)			25,901				3,871
Dividends			(228,741	)			(254,558	)			119,694				(106,322	)			(843,148	)
Prepaid expenses			14,129				24,911				50,084				30,308				23,798
Increase (Decrease) in Liabilities:
Payables:
Investment advisory fees			(76,682	)			(47,189	)			(130,181	)			(182,470	)			(99,204	)
Other affiliates			—				(76,934	)			—				—				—
Deferred foreign capital gain tax			—				—				—				(12,332	)			(116,814	)
Trustees’ and Officer’s			(66,975	)			(7,519	)			(104,936	)			(102,735	)			(87,412	)
Other accrued expenses			(1,569	)			(57,908	)			(64,202	)			(68,883	)			(81,781	)
Net cash provided by operating activities			27,750,786				43,830,675				105,129,917				67,016,724				54,606,601
CASH (USED FOR) FINANCING ACTIVITIES
Payments on redemption of Common Shares			—				—				—				(5,965,980	)			(6,259,755	)
Cash dividends paid to Common Shareholders			(27,769,421	)			(43,860,530	)			(105,103,264	)			(61,350,010	)			(48,337,227	)
Increase in bank overdraft			11,259				—				—				—				—
Net cash used for financing activities			(27,758,162	)			(43,860,530	)			(105,103,264	)			(67,315,990	)			(54,596,982	)
CASH IMPACT FROM FOREIGN EXCHANGE FLUCTUATIONS
Cash impact from foreign exchange fluctuations		$	(18	)		$	—			$	(92	)		$	(1,980	)		$	(1,132	)
CASH AND FOREIGN CURRENCY
Net increase (decrease) in restricted and unrestricted cash and foreign currency			(7,394	)			(29,855	)			26,561				(301,246	)			8,487
Restricted and unrestricted cash and foreign currency at value at beginning of year			13,853				75,000				18,441				3,691,381				5,134,483
Restricted and unrestricted cash and foreign currency at value at end of year		$	6,459			$	45,145			$	45,002			$	3,390,135			$	5,142,970
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
NON-CASH FINANCING ACTIVITIES AND FOREIGN CURRENCY
Capital shares issued in reinvestment of distributions paid to Common Shareholders			—				—				—				—				—
RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AND FOREIGN CURRENCY AT THE END OF YEAR TO THE STATEMENTS OF ASSETS AND LIABILITIES
Cash			—				45,145				43,458				—				—
Cash pledged:
Collateral — options written			—				—				—				2,785,000				4,136,000
Collateral — OTC derivatives			—				—				—				—				201,000
Foreign currency at value			6,459				—				1,544				605,135				805,970
		$	6,459			$	45,145			$	45,002			$	3,390,135			$	5,142,970
RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AND FOREIGN CURRENCY AT THE BEGINNING OF YEAR TO THE STATEMENTS OF ASSETS AND LIABILITIES
Cash			—				—				—				—				20,583
Cash pledged:
Collateral — reverse repurchase agreements			—				—				—				2,970,000				2,350,000
Collateral — OTC derivatives			—				75,000				16,000				20,000				2,118,000
Foreign currency at value			13,853				—				2,441				701,381				645,900
		$	13,853			$	75,000			$	18,441			$	3,691,381			$	5,134,483

See notes to financial statements.

 

 

FINANCIAL STATEMENTS			105

---

Statements of Cash Flows  (continued)

Year Ended December 31, 2018

 

		BME				BCX (a)				BST				BUI
CASH PROVIDED BY OPERATING ACTIVITIES
Net increase (decrease) in net assets resulting from operations		$	22,441,758			$	(152,814,691	)		$	5,215,889			$	(15,149,759	)
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used for) operating activities:
Proceeds from sales of long-term investments			143,471,951				682,143,625				399,637,873				112,519,900
Purchases of long-term investments			(126,851,914	)			(627,902,668	)			(357,980,027	)			(94,003,140	)
Net proceeds from sales (purchases) of short-term securities			(11,549,866	)			2,715,884				1,743,983				(3,420,968	)
Premiums received from options written			24,217,348				68,298,149				72,847,560				16,405,866
Premiums paid on closing options written			(27,946,066	)			(69,794,912	)			(73,282,407	)			(16,083,059	)
Net realized gain (loss) on investments and options written			(23,014,330	)			(41,391,019	)			(67,674,682	)			(6,731,008	)
Net unrealized depreciation on investments, options written and foreign currency translations			1,507,928				215,375,441				57,602,878				30,074,814
(Increase) Decrease in Assets:
Receivables:
Dividends — affiliated			(33,651	)			(20,578	)			(15,119	)			(5,798	)
Dividends			(63,099	)			247,622				70,233				642
Prepaid expenses			10,177				30,783				19,266				18,644
Securities lending income — affiliated			540				(1,763	)			33,595				—
Deferred offering costs			8,455				—				—				—
Increase (Decrease) in Liabilities:
Collateral on securities loaned at value			(116,225	)			(211,358	)			(1,786,946	)			—
Payables:
Investment advisory fees			21,902				(156,191	)			(16,192	)			(28,775	)
Trustees’ and Officer’s			(1,379	)			(59,670	)			3,222				(507	)
Other accrued expenses			(53,173	)			(61,192	)			(2,329	)			(30,087	)
Net cash provided by operating activities			2,050,356				76,397,462				36,416,797				23,566,765
CASH (USED FOR) FINANCING ACTIVITIES
Proceeds from issuance of Common Shares			19,540,372				—				—				—
Payments on redemption of Common Shares			—				(16,940,963	)			—				—
Payments for offering costs			24,000				—				—				—
Cash dividends paid to Common Shareholders			(21,605,379	)			(59,317,390	)			(37,754,053	)			(23,693,436	)
Increase (decrease) in bank overdraft			(10,013	)			—				—				126,671
Net cash used for financing activities			(2,051,020	)			(76,258,353	)			(37,754,053	)			(23,566,765	)
CASH IMPACT FROM FOREIGN EXCHANGE FLUCTUATIONS
Cash impact from foreign exchange fluctuations		$	(7	)		$	39			$	(98	)		$	(3	)
CASH AND FOREIGN CURRENCY
Net increase (decrease) in restricted and unrestricted cash and foreign currency			(671	)			139,148				(1,337,354	)			(3	)
Restricted and unrestricted cash and foreign currency at value at beginning of year			959				106,149				2,520,651				60
Restricted and unrestricted cash and foreign currency at value at end of year		$	288			$	245,297			$	1,183,297			$	57
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
NON-CASH FINANCING ACTIVITIES AND FOREIGN CURRENCY
Capital shares issued in reinvestment of distributions paid to Common Shareholders			1,085,098				—				1,815,026				928,907
RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AND FOREIGN CURRENCY AT THE END OF YEAR TO THE STATEMENTS OF ASSETS AND LIABILITIES
Cash			—				43,980				21,377				—
Cash pledged:
Collateral — OTC derivatives			—				—				1,160,000				—
Foreign currency at value			288				201,317				1,920				57
		$	288			$	245,297			$	1,183,297			$	57
RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AND FOREIGN CURRENCY AT THE BEGINNING OF YEAR TO THE STATEMENTS OF ASSETS AND LIABILITIES
Cash			—				94,925				—				—
Cash pledged:
Collateral — OTC derivatives			—				—				2,520,000				—
Foreign currency at value			959				11,224				651				60
		$	959			$	106,149			$	2,520,651			$	60

 

(a)	Consolidated Statement of Cash Flows

See notes to financial statements.

 

 

106		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Financial Highlights

(For a share outstanding throughout each period)

 

		BGR
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	15.79			$	16.33			$	14.05			$	21.15							$	24.90			$	30.12
Net investment income(a)			0.28				0.40	(b)			0.27				0.29								0.07				0.25
Net realized and unrealized gain (loss)			(3.16	)			(0.01	)			3.01				(5.89	)							(2.41	)			(1.21	)
Net increase (decrease) from investment operations			(2.88	)			0.39				3.28				(5.60	)							(2.34	)			(0.96	)
Distributions(c)
From net investment income			(0.27	)			(0.40	)			(0.27	)			(0.29	)							(0.47	)			(0.44	)
From net realized gain			—				—				—				—								(0.94	)			(3.82	)
From return of capital			(0.66	)			(0.53	)			(0.73	)			(1.21	)							—				—
Total distributions			(0.93	)			(0.93	)			(1.00	)			(1.50	)							(1.41	)			(4.26	)
Net asset value, end of period		$	11.98			$	15.79			$	16.33			$	14.05							$	21.15			$	24.90
Market price, end of period		$	10.45			$	14.18			$	14.44			$	12.53							$	19.95			$	23.78
Total Return(d)
Based on net asset value			(18.84	)%			3.49	%			25.07	%			(27.47	)%							(9.06	)%(e)			(2.36	)%
Based on market price			(21.16	)%			5.11	%			24.01	%			(31.42	)%							(10.18	)%(e)			4.73	%
Ratios to Average Net Assets
Total expenses			1.29	%			1.31	%			1.31	%			1.29	%							1.30	%(f)			1.26	%
Total expenses after fees waived and/or reimbursed			1.14	%			1.18	%			1.24	%			1.26	%							1.26	%(f)			1.26	%
Net investment income			1.87	%			2.69	%(b)			1.80	%			1.60	%							1.82	%(f)			0.89	%
Supplemental Data
Net assets, end of period (000)		$	357,391			$	471,062			$	487,064			$	418,981							$	629,603			$	741,109
Portfolio turnover rate			32	%			24	%			33	%			56	%							4	%			85	%

 

(a)	Based on average shares outstanding.

(b)	Net investment income per share and the ratio of net investment income to average net assets include $0.15 per share and 0.99%, respectively, resulting from a special dividend from BakerHughes, Inc. in July 2017.

(c)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(d)	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 at actual reinvestment prices.

(e)	Aggregate total return.

(f)	Annualized.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS			107

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		CII
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	17.19			$	15.08			$	15.11			$	15.67							$	15.47			$	15.31
Net investment income(a)			0.17				0.15				0.13				0.11								0.04				0.55
Net realized and unrealized gain (loss)			(1.09	)			2.95				0.99				0.53								0.36				0.91
Net increase (decrease) from investment operations			(0.92	)			3.10				1.12				0.64								0.40				1.46
Distributions(b)
From net investment income			(0.45	)			(0.15	)			(0.13	)			(0.14	)							(0.10	)			(0.65	)
From net realized gain			—				—				(0.04	)			(1.06	)							—				—
From return of capital			(0.54	)			(0.84	)			(0.98	)			—								(0.10	)			(0.65	)
Total distributions			(0.99	)			(0.99	)			(1.15	)			(1.20	)							(0.20	)			(1.30	)
Net asset value, end of period		$	15.28			$	17.19			$	15.08			$	15.11							$	15.67			$	15.47
Market price, end of period		$	14.08			$	16.38			$	13.71			$	14.14							$	13.97			$	14.89
Total Return(c)
Based on net asset value			(5.44	)%			21.69	%			8.66	%			4.66	%							2.69	%(d)			10.49	%
Based on market price			(8.56	)%			27.54	%			5.56	%			9.86	%							(4.88	)%(d)			20.43	%
Ratios to Average Net Assets
Total expenses			0.90	%			0.93	%			0.95	%			0.94	%							0.99	%(e)			0.93	%
Total expenses after fees waived and/or reimbursed			0.90	%			0.93	%			0.95	%			0.94	%							0.95	%(e)			0.93	%
Net investment income			1.00	%			0.94	%			0.89	%			0.71	%							1.42	%(e)			3.56	%
Supplemental Data
Net assets, end of period (000)		$	674,077			$	758,400			$	665,159			$	666,492							$	691,380			$	682,485
Portfolio turnover rate			27	%			32	%			54	%			133	%							2	%			80	%

 

(a)	Based on average shares outstanding.

(b)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c)	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 at actual reinvestment prices.

(d)	Aggregate total return.

(e)	Annualized.

See notes to financial statements.

 

 

108		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BDJ
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	9.96			$	9.22			$	8.70			$	9.24							$	9.19			$	8.88
Net investment income(a)			0.18	(b)			0.16				0.17				0.17								0.04				0.16
Net realized and unrealized gain (loss)			(0.84	)			1.14				0.91				(0.15	)							0.10				0.76
Net increase (decrease) from investment operations			(0.66	)			1.30				1.08				0.02								0.14				0.92
Distributions(c)
From net investment income			(0.56	)			(0.17	)			(0.17	)			(0.17	)							(0.03	)			(0.17	)
From net realized gain			—				(0.39	)			—				—								—				—
From return of capital			—				—				(0.39	)			(0.39	)							(0.06	)			(0.44	)
Total distributions			(0.56	)			(0.56	)			(0.56	)			(0.56	)							(0.09	)			(0.61	)
Net asset value, end of period		$	8.74			$	9.96			$	9.22			$	8.70							$	9.24			$	9.19
Market price, end of period		$	7.77			$	9.23			$	8.15			$	7.61							$	8.12			$	8.35
Total Return(d)
Based on net asset value			(6.59	)%			15.06	%			13.90	%			1.10	%							1.69	%(e)			11.40	%
Based on market price			(10.39	)%			20.63	%			15.11	%			0.63	%							(1.65	)%(e)			16.42	%
Ratios to Average Net Assets
Total expenses			0.85	%			0.86	%			0.87	%			0.86	%							0.87	%(f)			0.87	%(g)
Total expenses after fees waived and/or reimbursed			0.85	%			0.86	%			0.85	%			0.85	%							0.84	%(f)			0.86	%(g)
Net investment income			1.85	%(b)			1.73	%			1.91	%			1.85	%							2.30	%(f)			1.81	%
Supplemental Data
Net assets, end of period (000)		$	1,638,237			$	1,868,457			$	1,741,649			$	1,643,508							$	1,747,070			$	1,648,683
Portfolio turnover rate			34	%			42	%			33	%			26	%							0	%(h)			63	%

 

(a)	Based on average Common Shares outstanding.

(b)	Net investment income per share and the ratio of net investment income to average net assets includes $0.01 per share and 0.14%, respectively, resulting from a special dividend.

(c)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(d)	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 at actual reinvestment prices.

(e)	Aggregate total return.

(f)	Annualized.

(g)	Includes reorganization costs associated with the Trust’s merger. Without these costs, total expenses and total expenses after fees waived and/or reimbursed would have been 0.86% and 0.86%, respectively.

(h)	Amount is less than 0.5%

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS			109

---

Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BOE
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	13.22			$	13.38			$	14.25			$	15.27							$	15.54			$	16.68
Net investment income(a)			0.31				0.17				0.15				0.11								0.00	(b)			0.14
Net realized and unrealized gain (loss)			(1.61	)			1.96				0.03				0.03								(0.07	)			0.07
Net increase (decrease) from investment operations			(1.30	)			2.13				0.18				0.14								(0.07	)			0.21
Distributions(c)
From net investment income			(0.83	)			(0.19	)			(0.10	)			(0.17	)							—				(0.17	)
In excess of net investment income(d)			—				—				—				(0.10	)							—				(0.28	)
From net realized gain			—				(2.10	)			—				—								—				—
From return of capital			(0.02	)			—				(0.95	)			(0.89	)							(0.20	)			(0.90	)
Total distributions			(0.85	)			(2.29	)			(1.05	)			(1.16	)							(0.20	)			(1.35	)
Net asset value, end of period		$	11.07			$	13.22			$	13.38			$	14.25							$	15.27			$	15.54
Market price, end of period		$	9.37			$	12.51			$	11.57			$	12.76							$	13.13			$	14.00
Total Return(e)
Based on net asset value			(9.63	)%			17.22	%(f)			2.62	%			1.81	%							(0.27	)%(g)			2.10	%
Based on market price			(19.16	)%			28.28	%			(0.90	)%			6.03	%							(4.82	)%(g)			4.09	%
Ratios to Average Net Assets
Total expenses			1.08	%			1.09	%(h)			1.10	%			1.08	%(h)							1.10	%(i)			1.08	%
Total expenses after fees waived and/or reimbursed			0.94	%			1.02	%(h)			1.05	%			1.05	%(h)							1.07	%(i)			1.08	%
Net investment income			2.52	%			1.20	%(h)			1.15	%			0.73	%(h)							0.00	%(i)(j)			0.83	%
Supplemental Data
Net assets, end of period (000)		$	754,602			$	911,227			$	929,897			$	990,318							$	1,060,687			$	1,079,862
Portfolio turnover rate			28	%			133	%			64	%			72	%							16	%			150	%

 

(a)	Based on average shares outstanding.

(b)	Amount is less than $0.005 per share.

(c)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(d)	Taxable distribution.

(e)	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 at actual reinvestment prices.

(f)	Includes payment received from an affiliate, which had no impact on the Trust’s total return.

(g)	Aggregate total return.

(h)	Excludes expenses incurred indirectly as a result of investments in underlying funds of 0.01%.

(i)	Annualized.

(j)	Amount is less than 0.005%.

See notes to financial statements.

 

 

110		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BGY
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	7.06			$	6.28			$	6.95			$	7.61							$	7.89			$	9.05
Net investment income (loss)(a)			0.17	(b)			0.09				0.09				0.08								(0.00	) (c)			0.10
Net realized and unrealized gain (loss)			(1.00	)			1.15				(0.24	)			(0.15	)							(0.17	)			(0.53	)
Net increase (decrease) from investment operations			(0.83	)			1.24				(0.15	)			(0.07	)							(0.17	)			(0.43	)
Distributions(d)
From net investment income			(0.44	)			(0.09	)			(0.07	)			(0.11	)							—				(0.13	)
In excess of net investment income(e)			—				—				—				—								—				(0.08	)
From return of capital			—				(0.37	)			(0.45	)			(0.48	)							(0.11	)			(0.52	)
Total distributions			(0.44	)			(0.46	)			(0.52	)			(0.59	)							(0.11	)			(0.73	)
Net asset value, end of period		$	5.79			$	7.06			$	6.28			$	6.95							$	7.61			$	7.89
Market price, end of period		$	4.98			$	6.52			$	5.51			$	6.24							$	6.74			$	7.26
Total Return(f)
Based on net asset value			(11.48	)%			20.88	%(g)			(1.12	)%			(0.47	)%							(2.10	)%(h)			(4.49	)%
Based on market price			(17.55	)%			27.23	%			(3.37	)%			0.90	%							(5.77	)%(h)			(2.29	)%
Ratios to Average Net Assets
Total expenses(i)			1.09	%			1.12	%			1.12	%			1.09	%							1.12	%(j)			1.10	%
Total expenses after fees waived and/or reimbursed(i)			0.99	%			1.02	%			1.02	%			1.01	%							1.03	%(j)			1.05	%
Net investment income (loss)(i)			2.59	%(b)			1.31	%			1.41	%			1.09	%							(0.13	)%(j)			1.17	%
Supplemental Data
Net assets, end of period (000)		$	623,234			$	769,678			$	690,628			$	764,154							$	836,552			$	867,986
Portfolio turnover rate			60	%			90	%			74	%			67	%							14	%			195	%

 

(a)	Based on average shares outstanding.

(b)	Net investment loss per share and ratio of net investment loss to average net assets include $0.01 per share and 0.10%, respectively, resulting from a special dividend.

(c)	Amount is greater than $(0.005) per share.

(d)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(e)	Taxable distribution.

(f)	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 at actual reinvestment prices.

(g)	Includes payment received from an affiliate, which had no impact on the Trust’s total return.

(h)	Aggregate total return.

(i)	Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

 

		Year Ended December 31																																Period from 11/01/14 to 12/31/14								Year Ended October 31, 2014
		2018								2017								2016								2015
Investments in underlying funds			—								0.02	%							0.01	%							0.01	%							—								—

 

(j)	Annualized.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS			111

---

Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BME
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	35.69			$	31.30			$	36.19			$	38.61							$	40.22			$	34.92
Net investment income (loss)(a)			0.07				0.02				0.02				(0.06	)							(0.01	)			(0.00	)(b)
Net realized and unrealized gain (loss)			2.51				6.77				(1.91	)			4.34								1.10				9.14
Net increase (decrease) from investment operations			2.58				6.79				(1.89	)			4.28								1.09				9.14
Distributions(c)
From net investment income			(2.40	)			(0.04	)			(0.03	)			(0.63	)							(0.01	)			(0.10	)
From net realized gain			—				(2.11	)			(2.97	)			(6.07	)							(2.69	)			(3.74	)
From return of capital			—				(0.25	)			—				—								—				—
Total distributions			(2.40	)			(2.40	)			(3.00	)			(6.70	)							(2.70	)			(3.84	)
Net asset value, end of period		$	35.87			$	35.69			$	31.30			$	36.19							$	38.61			$	40.22
Market price, end of period		$	36.45			$	36.50			$	31.75			$	39.35							$	42.70			$	41.37
Total Return(d)
Based on net asset value			7.26	%			22.17	%			(5.36	)%			10.70	%							2.38	%(e)			28.00	%
Based on market price			6.57	%			23.17	%			(11.71	)%			8.87	%							10.07	%(e)			36.99	%
Ratios to Average Net Assets(f)
Total expenses			1.11	%			1.12	%			1.15	%(g)			1.13	%							1.16	%(h)			1.11	%
Total expenses after fees waived and/or reimbursed and excluding amortization of offering costs			1.11	%			1.12	%			1.14	%			1.12	%							1.11	%(h)			1.11	%
Net investment income (loss)			0.19	%			0.06	%			0.07	%			(0.14	)%							(0.10	)%(h)			(0.01	)%
Supplemental Data
Net assets, end of period (000)		$	352,675			$	331,858			$	270,693			$	297,530							$	303,103			$	313,933
Portfolio turnover rate			37	%			38	%			59	%			68	%							6	%			74	%

 

(a)	Based on average shares outstanding.

(b)	Amount is greater than $(0.005) per share.

(c)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(d)	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 at actual reinvestment prices.

(e)	Aggregate total return.

(f)	Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

 

		Year Ended December 31																																Period from 11/01/14 to 12/31/14								Year Ended October 31, 2014
		2018								2017								2016								2015
Investments in underlying funds			0.01	%							0.01	%							—	%							—	%							—	%							—	%

 

(g)	Offering costs were not annualized in the calculation of the expense ratios. If these expenses were annualized, the total expenses would have been 1.16%.

(h)	Annualized.

See notes to financial statements.

 

 

112		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BCX
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	10.64			$	9.86			$	8.35			$	11.67							$	12.50			$	13.54
Net investment income(a)			0.22				0.20	(b)			0.14				0.25								0.04				0.23
Net realized and unrealized gain (loss)			(1.80	)			1.19				1.95				(2.76	)							(0.72	)			(0.27	)
Net increase (decrease) from investment operations			(1.58	)			1.39				2.09				(2.51	)							(0.68	)			(0.04	)
Distributions(c)
From net investment income			(0.19	)			(0.24	)			(0.15	)			(0.25	)							(0.02	)			(0.31	)
From return of capital			(0.43	)			(0.37	)			(0.43	)			(0.56	)							(0.13	)			(0.69	)
Total distributions			(0.62	)			(0.61	)			(0.58	)			(0.81	)							(0.15	)			(1.00	)
Net asset value, end of period		$	8.44			$	10.64			$	9.86			$	8.35							$	11.67			$	12.50
Market price, end of period		$	7.06			$	9.77			$	8.27			$	7.11							$	9.71			$	10.78
Total Return(d)
Based on net asset value			(14.90	)%			15.60	%			27.41	%			(21.31	)%							(5.20	)%(e)			0.61	%
Based on market price			(22.47	)%			26.55	%			25.50	%			(19.47	)%							(8.53	)%(e)			0.58	%
Ratios to Average Net Assets
Total expenses			1.08	%			1.08	%			1.08	%			1.07	%							1.15	%(f)			1.35	%(g)
Total expenses after fees waived and/or reimbursed			1.08	%			1.08	%			1.08	%			1.07	%							1.04	%(f)			1.06	%(g)
Net investment income			2.17	%			2.06	%(b)			1.61	%			2.43	%							2.01	%(f)			1.70	%(g)
Supplemental Data
Net assets, end of period (000)		$	798,282			$	1,027,472			$	976,899			$	827,040							$	1,156,499			$	582,220
Portfolio turnover rate			66	%			73	%			101	%			74	%							2	%			62	%

 

(a)	Based on average shares outstanding.

(b)	Net investment income per share and the ratio of net investment income to average net assets include less than $0.04 per share and 0.39% respectively, resulting from a special dividend from Baker Hughes Inc. in July 2017.

(c)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(d)	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 at actual reinvestment prices.

(e)	Aggregate total return.

(f)	Annualized.

(g)	Includes reorganization costs associated with the Trust’s merger. Without these costs, total expenses and total expenses after fees waived and/or reimbursed would have been 1.26% and 1.06%, respectively.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS			113

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BST
		Year Ended December 31,																				Period from October 30, 2014 (a) to December 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	27.73			$	20.10			$	19.70			$	19.43							$	19.10	(b)
Net investment income (loss)(c)			(0.13	)			(0.05	)			0.00	(d)			0.03								(0.01	)
Net realized and unrealized gain			0.37				8.96				1.60				1.44								0.48
Net increase (decrease) from investment operations			0.24				8.91				1.60				1.47								0.47
Distributions(e)
From net investment income			(1.68	)			(0.05	)			—				(0.03	)							(0.00	)(f)
From net realized gain			(0.08	)			(0.22	)			—				(0.01	)							—
From return of capital			—				(1.01	)			(1.20	)			(1.16	)							(0.10	)
Total distributions			(1.76	)			(1.28	)			(1.20	)			(1.20	)							(0.10	)
Capital changes with respect to issuance of Common Shares			—				—				—				—								(0.04	)
Net asset value, end of period		$	26.21			$	27.73			$	20.10			$	19.70							$	19.43
Market price, end of period		$	27.48			$	26.69			$	17.94			$	17.31							$	17.59
Total Return(g)
Based on net asset value			0.24	%			45.73	%			9.36	%			8.61	%							2.31	%(h)
Based on market price			9.18	%			57.15	%			11.08	%			5.36	%							(11.55	)%(h)
Ratios to Average Net Assets
Total expenses			1.09	%			1.09	%			1.10	%			1.12	%							1.19	%(i)
Total expenses after fees waived and/or reimbursed			0.89	%			0.89	%			0.90	%			0.92	%							0.97	%(i)
Net investment income (loss)			(0.43	)%			(0.19	)%			0.02	%			0.15	%							(0.24	)%(i)
Supplemental Data
Net assets, end of period (000)		$	587,908			$	620,300			$	452,443			$	443,477							$	437,380
Portfolio turnover rate			53	%			41	%			74	%			91	%							7	%

 

(a)	Commencement of investment operations. This information includes the initial investment by BlackRock HoldCo2, Inc.

(b)	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.

(c)	Based on average shares outstanding.

(d)	Amount is less than $0.005 per share.

(e)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(f)	Amount is greater than $(0.005) per share.

(g)	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 at actual reinvestment prices.

(h)	Aggregate total return.

(i)	Annualized.

See notes to financial statements.

 

 

114		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

		BUI
		Year Ended December 31,																				Period from 11/01/14 to 12/31/14				Year Ended October 31, 2014
		2018				2017				2016				2015
Net asset value, beginning of period		$	21.12			$	19.42			$	19.50			$	22.47							$	22.40			$	20.78
Net investment income(a)			0.49				0.56				0.56				0.47								0.11				0.51
Net realized and unrealized gain (loss)			(1.39	)			2.59				0.81				(1.99	)							0.20				2.68
Net increase (decrease) from investment operations			(0.90	)			3.15				1.37				(1.52	)							0.31				3.19
Distributions(b)
From net investment income			(1.44	)			(0.47	)			(0.49	)			(0.42	)							(0.10	)			(0.51	)
From net realized gain			—				(0.98	)			(0.53	)			(0.54	)							—				(0.37	)
From return of capital			(0.01	)			—				(0.43	)			(0.49	)							(0.14	)			(0.69	)
Total distributions			(1.45	)			(1.45	)			(1.45	)			(1.45	)							(0.24	)			(1.57	)
Net asset value, end of period		$	18.77			$	21.12			$	19.42			$	19.50							$	22.47			$	22.40
Market price, end of period		$	19.76			$	21.62			$	18.41			$	16.78							$	20.74			$	20.02
Total Return(c)
Based on net asset value			(4.40	)%			16.62	%			7.57	%			(6.09	)%							1.50	%(d)			16.94	%
Based on market price			(1.68	)%			25.93	%			18.50	%			(12.45	)%							4.82	%(d)			18.29	%
Ratios to Average Net Assets
Total expenses			1.12	%			1.11	%			1.13	%			1.11	%							1.17	%(e)			1.10	%
Total expenses after fees waived and/or reimbursed			1.09	%			1.09	%			1.13	%			1.11	%							1.11	%(e)			1.10	%
Net investment income			2.46	%			2.70	%			2.83	%			2.24	%							2.83	%(e)			2.36	%
Supplemental Data
Net assets, end of period (000)		$	318,933			$	357,776			$	328,297			$	329,747							$	379,830			$	378,762
Portfolio turnover rate			28	%			31	%			8	%			20	%							2	%			41	%

 

(a)	Based on average shares outstanding.

(b)	Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c)	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 at actual reinvestment prices.

(d)	Aggregate total return.

(e)	Annualized.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS			115

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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”:

 

Trust 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 Enhanced Global Dividend Trust		BOE		Delaware		Diversified
BlackRock Enhanced International Dividend Trust		BGY		Delaware		Diversified
BlackRock Health Sciences Trust		BME		Delaware		Diversified
BlackRock Resources & Commodities Strategy Trust		BCX		Delaware		Non-diversified
BlackRock Science and Technology Trust		BST		Delaware		Non-diversified
BlackRock Utilities, Infrastructure & Power Opportunities Trust		BUI		Delaware		Diversified

The Boards of Directors and Boards 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 net asset values (“NAVs”) of their Common 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.

Basis of Consolidation: The accompanying consolidated financial statements of BCX include the account 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 other derivatives and satisfy regulated investment company tax requirements. BCX may invest up to 25% of its total assets in the Subsidiary. Intercompany accounts and transactions, if any, have been eliminated. During the year ended December 31, 2018, there were no transactions in the Subsidiary. 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 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, disclosure of contingent assets and liabilities at the date of 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. Below is a summary of significant accounting policies:

Investment Transactions and Income Recognition: 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 date. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when the Trusts are 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. Interest income, including amortization and accretion of premiums and discounts on debt securities, are recognized on an accrual basis.

Foreign Currency Translation: Each Trust’s books and records are maintained in U.S. dollars. 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 trading on the New York Stock Exchange (“NYSE”). Purchases and sales of investments 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 investments denominated in that currency will lose value; the opposite effect occurs if the U.S. dollar falls in relative value.

Each Trust does not isolate the portion of the results of operations arising as a result of changes in the exchange rates from the changes in the market prices of investments held or sold for financial reporting purposes. Accordingly, the effects of changes in 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. Each Trust reports 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 U.S. federal income tax purposes.

Segregation and Collateralization: In cases where a Trust enters into certain investments (e.g., futures contracts, forward foreign currency exchange contracts and options written) that would be treated as “senior securities” for 1940 Act purposes, a Trust may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Trusts 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.

Distributions: Distributions paid by the Trusts are recorded on the ex-dividend date. Subject to the Trusts’ level distribution plan, the Trusts intend to make monthly cash distributions to shareholders, which may consist of net investment income, net options premium and net realized and unrealized gains on investments and/or return of capital.

 

 

116		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

The character of distributions is determined in accordance with U.S. 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. See Note 8, Income Tax Information, for the tax character of each Trust’s distributions paid during the period.

Net income and realized gains from investments held by the Subsidiary are treated as ordinary income for tax purposes. If a net loss is realized by the Subsidiary in any taxable year, the loss will generally not be available to offset BCX’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 the Trustees’ and Officer’s 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.

Recent Accounting Standards: In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update “Premium Amortization of Purchased Callable Debt Securities” which amends the amortization period for certain purchased callable debt securities. Under the new guidance, the premium amortization of purchased callable debt securities that have explicit, non-contingent call features and are callable at fixed prices will be amortized to the earliest call date. The guidance will be applied on a modified retrospective basis and is effective for fiscal years, and their interim periods, beginning after December 15, 2018. Management is currently evaluating the impact of this guidance to the Trusts.

In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update 2018-13 “Changes to the Disclosure Requirements for Fair Value Measurement” which modifies disclosure requirements for fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years. Management is currently evaluating the impact of this guidance to the Trusts.

Indemnifications: In the normal course of business, a Trust enters into contracts that contain a variety of representations that provide general indemnification. A Trust’s maximum exposure under these arrangements is unknown because it involves future potential claims against a Trust, which cannot be predicted with any certainty.

Other: Expenses directly related to a Trust are charged to that Trust. Other operating expenses shared by several funds, including other funds managed by the Manager, are prorated among those funds on the basis of relative net assets or other appropriate methods.

 

3.	INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investment Valuation Policies: The Trusts’ investments are valued at fair value (also referred to as “market value” within the financial statements) as of the close of trading on the 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 using various 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 oversee the pricing function for all financial instruments.

Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Trust’s assets and liabilities:

 

•

Equity investments traded on a recognized securities exchange are valued at the official closing price each day, if available. For equity investments traded on more than one exchange, the official closing 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) price.

Generally, trading in foreign instruments is substantially completed each day at various times prior to the close of trading on the NYSE. Occasionally, events affecting the values of such instruments may occur between the foreign market close and the close of trading on the NYSE that may not be reflected in the computation of the Trusts’ net assets. Each business day, the Trusts use a pricing service to assist with the valuation of certain foreign exchange-traded equity securities and foreign exchange-traded and over-the-counter (“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 trading on the NYSE, which follows the close of the local markets.

 

•

Fixed-income securities for which market quotations are readily available are generally valued using the last available bid prices or current market quotations provided by independent dealers or third party pricing services. Floating rate loan interests are valued at the mean of the bid prices from one or more independent brokers or dealers as obtained from a third party pricing service. Pricing services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but a fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots may trade at lower prices than institutional round lots. The pricing services may use matrix pricing or valuation models that utilize certain inputs and assumptions to derive values, including transaction data (e.g., recent representative bids and offers), credit quality information, perceived market movements, news, and other relevant information. Certain fixed-income securities, including asset-backed and mortgage related securities may be valued based on valuation models that consider the estimated cash flows of each tranche of the entity, establish a benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche. The amortized cost method of valuation may be used with respect to debt obligations with sixty days or less remaining to maturity unless the Manager determines such method does not represent fair value.

 

•

Investments in open-end U.S. mutual funds are valued at NAV each business day.

 

 

NOTES TO FINANCIAL STATEMENTS			117

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Notes to Financial Statements  (continued)

 

 

•

The Trusts value their investment in SL Liquidity Series, LLC, Money Market Series (the “Money Market Series”) at fair value, which is ordinarily based upon their 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 may follow the parameters of investments by a money market fund that is subject to Rule 2a-7 under the 1940 Act.

 

•

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. 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.

If events (e.g., a company announcement, market volatility or a natural disaster) occur that are expected to materially affect the value of such instruments, or 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 Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee will include market approach, income approach and cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued 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 and consistent with the principles of fair value measurement.

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 each Trust’s 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 Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis. As a result of the inherent uncertainty in valuation of these investments, the fair values may differ from the values that would have been used had an active market existed.

For investments in equity or debt issued by privately held companies or funds (“Private Company” or collectively, the “Private Companies”) and other Fair Valued Investments, the fair valuation approaches that are used by third party pricing services utilize one or a combination of, but not limited to, the following inputs.

 

		Standard Inputs Generally Considered By Third Party Pricing Services
Market approach		(i)  recent market transactions, including subsequent rounds of financing, in the underlying investment or comparable issuers; (ii)   recapitalizations and other transactions across the capital structure; and (iii)  market multiples of comparable issuers.
Income approach		(i)  future cash flows discounted to present and adjusted as appropriate for liquidity, credit, and/or market risks; (ii)   quoted prices for similar investments or assets in active markets; and (iii)  other risk factors, such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, recovery rates, liquidation amounts and/or default rates.
Cost approach		(i)  audited or unaudited financial statements, investor communications and financial or operational metrics issued by the Private Company; (ii)   changes in the valuation of relevant indices or publicly traded companies comparable to the Private Company; (iii)  relevant news and other public sources; and (iv)  known secondary market transactions in the Private Company’s interests and merger or acquisition activity in companies comparable to the Private Company.

Investments in series of preferred stock issued by Private Companies are typically valued utilizing market approach in determining the enterprise value of the company. Such investments often contain rights and preferences that differ from other series of preferred and common stock of the same issuer. Valuation techniques such as an option pricing model (“OPM”), a probability weighted expected return model (“PWERM”) or a hybrid of those techniques are used in allocating enterprise value of the company, as deemed appropriate under the circumstances. The use of OPM and PWERM techniques involve a determination of the exit scenarios of the investment in order to appropriately allocate the enterprise value of the company among the various parts of its capital structure.

The Private Companies are not subject to the public company disclosure, timing, and reporting standards as other investments held by a Trust. Typically, the most recently available information by a Private Company is as of a date that is earlier than the date a Trust is calculating its NAV. This factor may result in a difference between the value of the investment and the price a Trust could receive upon the sale of the investment.

Fair Value Hierarchy: Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial statement purposes as follows:

 

•

Level 1 — Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each 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 each Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

118		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

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. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by Private Companies. There may not be a secondary market, and/or there are a limited number of investors. Level 3 investments may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the Global Valuation Committee in the absence of market information.

Changes in valuation techniques may result in transfers into or out of an assigned level within the hierarchy. In accordance with each Trust’s policy, transfers between different levels of the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investments and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

As of December 31, 2018, certain investments of BME, BCX and BST were valued using NAV or its equivalent as no quoted market value is available and therefore have been excluded from the fair value hierarchy.

 

4.	SECURITIES AND OTHER INVESTMENTS

Preferred Stocks: 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 the Trust, or excess collateral returned by the Trust, on the next business day. During the term of the loan, the Trusts are entitled to all distributions made on or in respect of the loaned securities, but do not receive interest income on securities received as collateral. 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 any securities on loan, all of which were classified as common stocks in the Trusts’ Schedules of Investments, and the value of any 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 period end, any securities on loan were collateralized by cash and/or U.S. Government obligations. Cash collateral invested by the securities lending agent, BlackRock Investment Management, LLC (“BIM”), if any, is disclosed in the Schedules of Investments.

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 Trusts, 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 a 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, absent an event of default, the borrower can resell or re-pledge the loaned securities, and a Trust can reinvest cash collateral received in connection with loaned securities. Upon an event of default, the parties’ obligations to return the securities or collateral to the other party are extinguished, and the parties can resell or re-pledge the loaned securities or the collateral received in connection with the loaned securities in order to satisfy the defaulting party’s net payment obligation for all transactions under the MSLA. The defaulting party remains liable for any deficiency.

As of period end, the following tables are a summary of the Trusts’ securities lending agreements by counterparty which are subject to offset under an MSLA:

 

Counterparty		Securities Loaned at Value				Cash Collateral Received (a)				Net Amount
BME
Barclays Bank PLC		$	364			$	(364	)		$	—
Societe Generale			4,128				(4,128	)			—
		$	4,492			$	(4,492	)		$	—
BCX
Goldman Sachs & Co.		$	217,995			$	(217,995	)		$	—
Merrill Lynch, Pierce, Fenner & Smith Inc.			11				(11	)			—
Morgan Stanley & Co. LLC			4				(4	)			—
		$	218,010			$	(218,010	)		$	—

 

 

NOTES TO FINANCIAL STATEMENTS			119

---

Notes to Financial Statements  (continued)

 

Counterparty		Securities Loaned at Value				Cash Collateral Received (a)				Net Amount
BST
Credit Suisse Securities (USA) LLC		$	1,302,857			$	(1,302,857	)		$	—
Goldman Sachs & Co.			35,159				(35,159	)			—
Jefferies & Co.			291,443				(291,443	)			—
		$	1,629,459			$	(1,629,459	)		$	—

 

(a)

Cash collateral with a value of $4,675, $273,985 and $1,710,283 for BME, BCX and BST, respectively, has been received in connection with securities lending agreements. Collateral received in excess of the value of securities loaned from the individual counterparty, if any, is not shown for financial reporting purposes in the table above.

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. Each Trust could incur 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.

 

5.	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 their exposure to certain risks such as credit risk, equity risk, interest rate risk, foreign currency exchange rate risk, commodity price risk or other risks (e.g., inflation risk). Derivative financial instruments categorized by risk exposure are included in the Schedules of Investments. These contracts may be transacted on an exchange or OTC.

Options: Certain Trusts purchase and write call and put options to increase or decrease their exposure to the risks of underlying instruments, including equity risk, interest rate 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.

Premiums paid on options purchased and premiums received on options written, as well as the daily fluctuation in market value, are included in investments at value — unaffiliated and options written at value, respectively, in the Statements of Assets and Liabilities. When an instrument is purchased or sold through the exercise of an option, the premium is offset against the cost or proceeds of the underlying instrument. When an option expires, a realized gain or loss is recorded in the Statements of Operations to the extent of the premiums received or paid. When an option is closed or sold, a gain or loss is recorded in the Statements of Operations 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 typically “covered,” meaning that they 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. These amounts, which are considered restricted, are included in cash pledged as collateral for options written in the Statements of Assets and Liabilities.

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 they 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.

Master Netting Arrangements: In order to define their contractual rights and to secure rights that will help them 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 their 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.

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 the Trusts and the counterparty.

Cash collateral that has been pledged to cover obligations of the Trusts 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 the Trusts, if any, is noted in the Schedules of Investments. Generally, the amount of collateral due from or to a counterparty is subject to a certain minimum transfer amount threshold 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 counterparty is not permitted to sell, re-pledge or use cash and non-cash collateral it receives. A Trust generally agrees not to use non-cash collateral that it receives but may, absent default or certain other circumstances defined in the underlying ISDA Master Agreement, be permitted to use cash collateral received. In such cases, interest may be paid pursuant to the collateral arrangement with the counterparty. To the extent amounts due to the Trusts from their counterparties are not fully collateralized, they bear the risk of loss from counterparty non-performance. Likewise, to the extent the Trusts have delivered collateral to a counterparty and stand ready to perform under the terms of their agreement with such counterparty, they bear 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. Based on the terms of agreements, collateral may not be required for all derivative contracts.

 

 

120		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

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.

 

6.	INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Advisory: Each Trust entered into an Investment Advisory Agreement with the Manager, the Trusts’ investment adviser, an indirect, wholly-owned subsidiary of BlackRock, to provide investment advisory and administrative services. The Manager is responsible for the management of each Trust’s portfolio and provides the personnel, facilities, equipment and certain other services necessary to the operations of each Trust.

For such services, each Trust, except BCX and BST, 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
BUI			1.00

For such services, BCX pays the Manager a monthly fee of 1.00% of the sum of the average daily value of the net assets of the Trust (excluding the value of the Trust’s interest in its Subsidiary) and the average daily value of the net assets of its Subsidiary, which fee is allocated pro rata between the Trust and the Subsidiary based on the average daily value of their respective net assets (excluding, in the case of the Trust, the value of the Trust’s interest in its Subsidiary).

For such services, BST pays the Manager a monthly fee at an annual rate equal to 1.00% of the average daily value of the Trust’s managed assets. For purposes of calculating this fee, “managed assets” means the total assets of the Trust (including any assets attributable to money borrowed for investment purposes) minus the sum of its accrued liabilities (other than money borrowed for investment purposes).

With respect to BGR, BOE, BGY, BCX and BUI, the Manager entered into separate sub-advisory agreements with BlackRock International Limited (“BIL”), an affiliate of the Manager. The Manager pays BIL, for services it provides, a monthly fee that is a percentage of the investment advisory fees paid by each Trust to the Manager.

The Manager provides investment management and other services to BCX’s 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.

Distribution Fees: BME has entered into a Distribution Agreement with BlackRock Investments, LLC (“BRIL”), an affiliate of the Manager, to provide for distribution of BME common shares on a reasonable best efforts basis through an equity shelf offering (a “Shelf Offering”) (the “Distribution Agreement”). Pursuant to the Distribution Agreement, BME will compensate BRIL with respect to sales of common shares at a commission rate of 1.00% of the gross proceeds of the sale of BME’s common shares and a portion of such commission is re-allowed to broker-dealers engaged by BRIL. The commissions retained by BRIL during the year ended December 31, 2018 amounted to $40,417.

Expense Limitations, Waivers, and Reimbursements: The Manager has contractually 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 voluntarily agreed to waive a portion of the investment advisory fees on the following Trusts as a percentage of their average weekly net assets, except BUI, which is average daily net assets, as follows:

 

BGR			0.150	%
BOE			0.175
BUI			0.025

Prior to July 1, 2018, the waiver as a percentage of BOE’s average weekly net assets was 0.100%.

With respect to BGY, the Manager has voluntarily agreed to waive a portion of its investment advisory fees equal to the annual rate of 0.10% of BGY’s average daily net assets.

These voluntary waivers may be reduced or discontinued at any time without notice.

 

 

NOTES TO FINANCIAL STATEMENTS			121

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Notes to Financial Statements  (continued)

 

For the year ended December 31, 2018, the investment advisory fees waived, which are included in fees waived and/or reimbursed by the Manager in the Statements of Operations, were as follows:

 

BGR		$	674,042
BOE			1,150,975
BGY			705,229
BST			1,348,548
BUI			84,951

With respect to each Trust, 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 (the “affiliated money market fund waiver”). These amounts are included in fees waived and/or reimbursed by the Manager in the Statements of Operations. For the year ended December 31, 2018, the amounts waived were as follows:

 

		Amount Waived
BGR		$	3,178
CII			3,200
BDJ			9,782
BOE			4,368
BGY			4,484
BME			8,521
BCX			7,702
BST			6,630
BUI			3,405

The Manager contractually agreed to waive its investment advisory fee with respect to any portion of each Trust’s assets invested in affiliated equity and fixed-income mutual funds and affiliated exchange-traded funds that have a contractual management fee through June 30, 2019. The agreement can be renewed for annual periods thereafter, and may be terminated on 90 days’ notice, each subject to approval by a majority of the Trusts’ Independent Trustees. For the year ended December 31, 2018, there were no fees waived and/or reimbursed by the Manager.

Securities Lending: 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 adviser 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, 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”). 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 income — affiliated — net in the Statements of Operations. For the year ended December 31, 2018, each Trust paid BIM the following amounts for securities lending agent services:

 

CII		$	3,425
BDJ			205
BME			439
BCX			4,097
BST			39,750

Trustees and Officers: Certain trustees and/or officers of the Trusts are trustees and/or officers 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 Trustees and Officer in the Statements of Operations.

Other Transactions: During the year ended December 31, 2018, BGY received reimbursements of $243,859 respectively, from an affiliate, which is shown as payments from affiliates in the Statements of Operations, related to the reimbursement of transaction costs.

During the year ended December 31, 2018, BDJ received a reimbursement of $6,782 from an affiliate, which is included in payments from affiliates in the Statements of Operations, related to operating event.

 

 

122		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

The Trusts may purchase securities from, or sell securities to, an affiliated fund provided the affiliation is due solely to having a common investment adviser, common officers, or common trustees. For the year ended December 31, 2018, the purchase and sale transactions and any net realized gains (losses) with an affiliated fund in compliance with Rule 17a-7 under the 1940 Act were as follows:

 

		Purchase				Sales				Net Realized Gain (Loss)
BDJ		$	3,832,651			$	—			$	—

 

7.	PURCHASES AND SALES

For the year ended December 31, 2018, purchases and sales of investments, excluding short-term securities, were as follows:

 

		Purchases				Sales
BGR		$	145,163,340			$	171,586,992
CII			205,453,856				242,565,466
BDJ			617,765,771				730,433,942
BOE			232,965,788				286,591,506
BGY			420,602,594				476,163,578
BME			127,775,053				143,471,689
BCX			627,875,497				682,129,410
BST			357,940,930				399,610,510
BUI			94,003,140				112,335,571

 

8.	INCOME TAX INFORMATION

It is each Trust’s 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 its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.

Each Trust files 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 generally remains open for each of the four years ended December 31, 2018. The statutes 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 December 31, 2018, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Trusts’ financial statements.

U.S. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share. As of period end, the following permanent differences attributable to net operating losses and non-deductible expenses were reclassified to the following accounts:

 

		BME				BST
Paid-in capital		$	(6,818	)		$	(3,585,363	)
Accumulated earnings (loss)			6,818				3,585,363

The tax character of distributions paid was as follows:

 

		BGR				CII				BDJ				BOE				BGY
Ordinary income
12/31/18		$	8,135,490			$	7,552,897			$	33,730,833			$	22,660,720			$	17,828,120
12/31/17			12,093,542				6,682,172				31,328,211				59,729,859				9,780,974
Long-term capital gains
12/31/18			—				12,374,208				71,367,931				34,238,980				30,479,902
12/31/17			—				—				74,032,175				98,000,577				—
Return of capital
12/31/18			19,637,853				23,911,918				—				1,381,549				—
12/31/17			15,679,802				37,156,851				—				—				40,102,438
Total
12/31/18		$	27,773,343			$	43,839,023			$	105,098,764			$	58,281,249			$	48,308,022
12/31/17		$	27,773,344			$	43,839,023			$	105,360,386			$	157,730,436			$	49,883,412

 

 

NOTES TO FINANCIAL STATEMENTS			123

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Notes to Financial Statements  (continued)

 

 

		BME				BCX				BST				BUI
Ordinary income
12/31/18		$	692,439			$	17,715,545			$	—			$	12,194,916
12/31/17			806,387				23,004,937				1,173,241				7,954,054
Long-term capital gains
12/31/18			21,998,038				—				39,423,699				12,329,188
12/31/17			18,575,419				—				4,969,225				16,614,050
Return of capital
12/31/18			—				41,596,743				—				98,239
12/31/17			2,234,310				36,309,489				22,536,962				—
Total
12/31/18		$	22,690,477			$	59,312,288			$	39,423,699			$	24,622,343
12/31/17		$	21,616,116			$	59,314,426			$	28,679,428			$	24,568,104

As of period end, the tax components of accumulated net earnings (losses) were as follows:

 

		BGR				CII				BDJ				BOE				BGY
Undistributed ordinary income		$	—			$	—			$	7,867,987			$	—			$	—
Undistributed long-term capital gains			—				—				118,011,126				—				19,966,623
Capital loss carryforwards			(158,185,500	)			—				—				—				—
Net unrealized gains (losses)(a)			(64,281,664	)			96,407,527				191,728,441				(66,456,883	)			(70,054,592	)
Qualified late-year losses(b)			(49,966	)			(2,329	)			—				(1,930,596	)			—
		$	(222,517,130	)		$	96,405,198			$	317,607,554			$	(68,387,479	)		$	(50,087,969	)
						BME				BCX				BST				BUI
Undistributed long-term capital gains						$	733,900			$	—			$	25,156,910			$	—
Capital loss carryforwards							—				(402,068,922	)			—				—
Net unrealized gains (losses)(a)							98,966,025				(22,273,952	)			216,499,136				41,808,238
Qualified late-year losses(b)							—				—				—				(5,338,746	)
						$	99,699,925			$	(424,342,874	)		$	241,656,046			$	36,469,492

 

(a)

The difference between book-basis and tax-basis net unrealized gains (losses) was attributable primarily to the tax deferral of losses on wash sales and straddles, the realization for tax purposes of unrealized gains/losses on certain options and foreign currency contracts, the realization for tax purposes of unrealized gains on investments in passive foreign investment companies, the timing and recognition of partnership income, and the deferral of compensation to Trustees.

(b)

The Trust has elected to defer certain qualified late-year losses and recognize such losses in the next taxable period.

As of December 31, 2018, the Trusts had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:

 

		BGR				BCX
No expiration date		$	158,185,500			$	402,068,922

During the year ended December 31, 2018, the Trusts listed below utilized the following amounts of their respective capital loss carryforward:

 

		CII				BGY				BCX
Amount utilized		$	21,333,622			$	31,492,776			$	35,311,282

As of December 31, 2018, gross unrealized appreciation and depreciation for investments and derivatives based on cost for U.S. federal income tax purposes were as follows:

 

		BGR				CII				BDJ				BOE				BGY
Tax cost		$	423,753,041			$	595,206,760			$	1,464,170,568			$	822,066,187			$	690,017,339
Gross unrealized appreciation		$	13,590,781			$	125,123,694			$	323,491,923			$	43,678,566			$	26,935,033
Gross unrealized depreciation			(75,953,950	)			(27,121,507	)			(126,073,152	)			(107,795,508	)			(94,136,526	)
Net unrealized appreciation (depreciation)		$	(62,363,169	)		$	98,002,187			$	197,418,771			$	(64,116,942	)		$	(67,201,493	)
						BME				BCX				BST				BUI
Tax cost						$	254,825,980			$	823,186,273			$	375,956,779			$	268,239,023
Gross unrealized appreciation						$	110,808,092			$	92,071,856			$	239,356,067			$	63,622,500
Gross unrealized depreciation							(9,942,309	)			(108,134,757	)			(18,422,511	)			(10,867,950	)
Net unrealized appreciation (depreciation)						$	100,865,783			$	(16,062,901	)		$	220,933,556			$	52,754,550

 

 

124		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

 

9.	PRINCIPAL RISKS

In the normal course of business, the Trusts invest in securities or other instruments and may enter into certain transactions, and such activities subject each Trust to various risks, including among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate and price fluctuations.

The Trusts may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00 and which may be subject to redemption gates or liquidity fees under certain circumstances.

Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A Trust may invest in illiquid investments and may experience difficulty in selling those investments in a timely manner at the price that they believe the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause each Trust’s NAV to experience significant increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a Trust may lose value, regardless of the individual results of the securities and other instruments in which a Trust invests.

The price a Trust could receive upon the sale of any particular portfolio investment may differ from a Trust valuation of the investment, particularly for securities that trade in thin or volatile markets or that are valued using a fair valuation technique or a price provided by an independent pricing service. Changes to significant unobservable inputs and assumptions (i.e., publicly traded company multiples, growth rate, time to exit) due to the lack of observable inputs may significantly impact the resulting fair value and therefore a Trust results of operations. As a result, the price received upon the sale of an investment may be less than the value ascribed by a Trust, and a Trust could realize a greater than expected loss or lesser than expected gain upon the sale of the investment. A Trust ability to value its investments may also be impacted by technological issues and/or errors by pricing services or other third party service providers.

Counterparty Credit Risk: The Trusts may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions. 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 approximately their value recorded in the Statements of Assets and Liabilities, less any collateral held by the Trusts.

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 in the amount of the premiums paid plus the positive change in market values net of any collateral held by the Trusts 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. The Trusts may be exposed to counterparty credit risk with respect to options written to the extent the Trusts deposit collateral with its counterparty to a written option.

With exchange-traded options purchased and futures, 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). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. 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 allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Trusts.

Concentration Risk: As of period end, the Trusts listed below invested a significant portion of their assets in securities in the following sectors:

 

Energy			BGR, BCX
Financials			BDJ
Health Care			BME
Information Technology			BST
Materials			BCX
Utilities			BUI

Changes in economic conditions affecting such sectors would have a greater impact on the Trusts and could affect the value, income and/or liquidity of positions in such securities.

BOE and BGY invests a substantial amount of their assets in issuers located in a single country or a limited number of countries. When a Trust’s concentrate its investments in this manner, it assumes the risk that economic, political and social conditions in those countries may have a significant impact on its investment performance. Foreign issuers may not be subject to the same uniform accounting, auditing and financial reporting standards and practices as used in the United States.

 

 

NOTES TO FINANCIAL STATEMENTS			125

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Notes to Financial Statements  (continued)

 

Foreign securities markets may also be less liquid, more volatile, and less subject to governmental supervision not typically associated with investing in U.S. securities. Investment percentages in specific countries are presented in the Schedules of Investments.

BGY, BOE, and BCX invest a significant portion of their assets in securities of issuers located in Europe or with significant exposure to European issuers or countries. The European financial markets have recently experienced volatility and adverse trends due to concerns about economic downturns in, or rising government debt levels of, several European countries. These events may spread to other countries in Europe and may affect the value and liquidity of the Trusts’ investments.

The United Kingdom is scheduled to withdraw from the European Union in March 2019, which may introduce significant new uncertainties and instability in the financial markets across Europe.

 

10.	CAPITAL SHARE TRANSACTIONS

Each Trust is authorized to issue an unlimited numbers of shares, with the exception of CII, all of which were initially classified as Common Shares. CII is authorized to issue 200 million Common Shares. The par value for each Trust’s Common Shares is $0.001, except for CII, which is $0.10. The Board is authorized, however, to reclassify any unissued Common Shares to Preferred Shares without the approval of Common Shareholders.

For the periods shown, shares issued and outstanding increased by the following amounts as a result of shares issued through the Shelf Offering:

 

		Year Ended
		12/31/18				12/31/17
BME			504,770				601,804

For the periods shown, shares issued and outstanding increased by the following amounts as a result of dividend reinvestment:

 

		Year Ended
		12/31/18				12/31/17
BME			28,688				47,676
BST			60,353				—
BUI			46,552				33,776

For the year ended December 31, 2018, for BGR, CII, and BDJ and December 31, 2017, for BGR, and CII, shares issued and outstanding remained constant.

On June 9, 2016, BME filed a final prospectus with the SEC allowing it to issue an additional 2,500,000 Common Shares through a Shelf Offering. 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 BME’s NAV per Common Share (calculated within 48 hours of pricing). As of period end, 1,029,718 Common Shares remain available for issuance under the Shelf Offering. From August 12, 2015 to June 9, 2016, BME was authorized to issue 453,000 Common Shares under a previous Shelf Offering. See Additional Information — Shelf Offering Program for additional information about the Shelf Offering.

Initial costs incurred by BME in connection with its shelf offering are recorded “Deferred offering costs” in the Statements of Assets and Liabilities. As shares are sold, a portion of the costs attributable to the shares sold will be charged against paid-in-capital. Any remaining deferred charges at the end of the shelf offering period will be charged to expense. Any subsequent costs incurred to keep the filing active will be charged to expense as incurred.

The Trusts participate in an open market share repurchase program (the “Repurchase Program”). Under the program, the Trusts were permitted to repurchase up to 5% of its outstanding common shares from December 1, 2017 through November 30, 2018, based on common shares outstanding as of the close of business on November 30, 2017, subject to certain conditions. On September 7, 2018, the Trusts announced a continuation of the Repurchase Program. Commencing on December 1, 2018, the Trusts may repurchase up to 5% of its outstanding common shares through November 30, 2019, based on common shares outstanding as of the close of business on November 30, 2018, subject to certain conditions. There is no assurance that the Trusts will purchase shares in any particular amounts. The total amount of the repurchase offer is reflected in the Trusts’ Statements of Changes in Net Assets.

For the periods shown, shares repurchased and cost, including transaction costs, were as follows:

 

BDJ		Shares				Amount
December 31, 2018			—			$	—
December 31, 2017			1,435,917				12,272,105
BOE		Shares				Amount
December 31, 2018			728,069			$	7,051,296
December 31, 2017			571,366				7,428,758
BGY		Shares				Amount
December 31, 2018			1,342,421			$	6,926,639
December 31, 2017			940,260				5,726,813

 

 

126		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Notes to Financial Statements  (continued)

 

 

BCX		Shares				Amount
December 31, 2018			2,000,565			$	17,063,427
December 31, 2017			2,514,091				21,837,878
BST		Shares				Amount
December 31, 2018			—			$	—
December 31, 2017			136,367				2,799,570

 

11.	REGULATION S-X AMENDMENTS

On August 17, 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. The Funds have adopted the amendments pertinent to Regulation S-X in this shareholder report. The amendments impacted certain disclosure presentation on the Statements of Assets and Liabilities, Statements of Changes in Net Assets and Notes to the Financial Statements.

Prior year distribution information and undistributed (distributions in excess of) net investment income in the Statements of Changes in Net Assets has been modified to conform to the current year presentation in accordance with the Regulation S-X changes.

Distributions for the year ended December 31, 2017 were classified as follows:

 

		Net Investment Income				Net Realized Gain				Return of Capital
BGR		$	12,093,542			$	—			$	15,679,802
CII			6,682,172				—				37,156,851
BDJ			31,328,211				74,032,175				—
BOE			12,416,010				145,314,426				—
BGY			9,780,974				—				40,102,438
BME			355,707				19,026,099				2,234,310
BCX			23,004,937				—				36,309,489
BST			1,173,241				4,969,225				22,536,962
BUI			7,954,054				16,614,050				—

Undistributed (distributions in excess of) net investment income as of December 31, 2017 is as follows:

 

		Undistributed (Distributions in Excess of) Net Investment Income
BGR		$	(729,389	)
CII			(189,571	)
BDJ			(970,285	)
BOE			(732,747	)
BGY			(642,554	)
BME			(61,330	)
BCX			(3,674,326	)
BST			(1,852,285	)
BUI			3,097,658

 

12.	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:

 

		Common Dividend Per Share
		Paid (a)				Declared (b)
BGR		$	0.077600			$	0.077600
CII			0.082800				0.082800
BDJ			0.046700				0.046700
BOE			0.063000				0.063000
BGY			0.033800				0.033800
BME			0.200000				0.200000
BCX			0.051600				0.051600
BST			0.150000				0.150000
BUI			0.121000				0.121000

 

(a)

Net investment income dividend paid on January 31, 2019 to shareholders of record on January 15, 2019.

(b)

Net investment income dividend declared on February 1, 2019, payable to shareholders of record on February 15, 2019.

 

 

NOTES TO FINANCIAL STATEMENTS			127

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Report of Independent Registered Public Accounting Firm

 

To the Shareholders and Boards of Trustees/Directors of BlackRock Energy and Resources Trust, BlackRock Enhanced Capital and Income Fund, Inc., BlackRock Enhanced Equity Dividend Trust, BlackRock Enhanced Global Dividend Trust, BlackRock Enhanced International Dividend Trust, BlackRock Health Sciences Trust, BlackRock Resources & Commodities Strategy Trust, BlackRock Science and Technology Trust, and BlackRock Utilities, Infrastructure & Power Opportunities Trust:

Opinion on the Financial Statements and Financial Highlights

We have audited the accompanying consolidated statement of assets and liabilities of BlackRock Resources & Commodities Strategy Trust and subsidiary, including the consolidated schedule of investments, as of December 31, 2018, the related consolidated statements of operations and cash flows for the year then ended, the consolidated statements of changes in net assets for each of the two years in the period then ended, the consolidated financial highlights for the periods indicated in the table below, and the related notes. We have also audited the accompanying statements of assets and liabilities of BlackRock Energy and Resources Trust, BlackRock Enhanced Capital and Income Fund, Inc., BlackRock Enhanced Equity Dividend Trust, BlackRock Enhanced Global Dividend Trust, BlackRock Enhanced International Dividend Trust, BlackRock Health Sciences Trust, BlackRock Science and Technology Trust, and BlackRock Utilities, Infrastructure & Power Opportunities Trust, (collectively with BlackRock Resources & Commodities Strategy Trust, the “Funds”), including the schedules of investments, as of December 31, 2018, the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for the periods indicated in the table below, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Funds as of December 31, 2018, and the results of their operations and their cash flows for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the periods listed in the table below, in conformity with accounting principles generally accepted in the United States of America.

 

Fund		Financial Highlights
BlackRock Energy and Resources Trust, BlackRock Enhanced Capital and Income Fund, Inc., BlackRock Enhanced Equity Dividend Trust, BlackRock Enhanced Global Dividend Trust, BlackRock Enhanced International Dividend Trust, BlackRock Health Sciences Trust, BlackRock Resources & Commodities Strategy Trust, BlackRock Utilities, Infrastructure & Power Opportunities Trust		For each of the four years in the period ended December 31, 2018, for the period from November 1, 2014 through December 31, 2014, and for the year ended October 31, 2014
BlackRock Science and Technology Trust		For each of the four years in the period ended December 31, 2018 and for the period from October 30, 2014 (commencement of operations) through December 31, 2014

Basis for Opinion

These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2018, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

Deloitte & Touche LLP

Boston, Massachusetts

February 26, 2019

We have served as the auditor of one or more BlackRock investment companies since 1992.

 

 

128		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Important Tax Information  (unaudited)

 

During the fiscal year ended December 31, 2018, the following information is provided with respect to the distributions paid:

 

		Payable Date		Long-Term Capital Gains				Non-Taxable Return of Capital				Qualified Dividend Income for Individuals  (a)				Dividends Qualifying for the Dividends Received Deduction for Corporations (a)				Short-Term Capital Gain Dividends for Non-U.S. Residents (b)				Foreign Source Income				Foreign Taxes Paid (c)
BGR		01/31/18 — 12/31/18			—	%			70.71	%			29.29	%			19.24	%			—	%			—	%			—	%
CII		01/31/18 — 12/31/18			28.23				54.54				17.23				17.23				—				—				—
BDJ		01/31/18 — 07/31/18			100.00				—				—				—				—				—				—
		08/31/18			90.50				—				9.50				8.02				0.04				—				—
		09/31/18 — 12/31/18			6.09				—				93.91				78.05				0.41				—				—
BOE		01/31/18 — 06/30/18			100.00				—				—				—				—				—				—
		07/31/18			26.03				4.17				69.80				29.31				—				40.75				4.51
		08/31/18 — 12/31/18			3.96				5.41				90.63				38.06				—				52.91				5.86
BGY		01/31/18 — 12/31/18			62.55				—				37.45				1.28				—				37.49				4.15
BME		01/31/18 — 12/31/18			96.93				—				3.07				3.07				—				—				—
BCX		01/31/18 — 12/31/18			—				70.13				29.87				9.35				—				26.94				3.60
BST		01/31/18 — 12/31/18			100.00				—				—				—				—				—				—
BUI		01/31/18			100.00				—				—				—				—				—				—
		02/28/18			96.37				0.03				3.17				1.60				0.45				—				—
		03/31/18 — 12/31/18			40.46				0.48				52.04				26.28				7.35				—				—

 

(a)

The Trusts hereby designate the percentages indicated above to the maximum amount allowable by law.

(b)

Represents the portion of the dividends eligible for exemption from U.S. withholding tax for nonresident aliens and foreign corporations.

(c)

The foreign taxes paid represent taxes incurred by the fund on income received from foreign sources. Foreign taxes paid may be included in taxable income with an offsetting deduction from gross income or may be taken as a credit for taxes paid to foreign governments. You should consult your tax advisor regarding the appropriate treatment of foreign taxes paid.

 

 

IMPORTANT TAX INFORMATION			129

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Automatic Dividend Reinvestment Plans

 

Pursuant to each Trust’s Dividend Reinvestment Plan (the “Reinvestment Plan”), Common Shareholders are automatically enrolled, to have all distributions of dividends and capital gains and other distributions reinvested by Computershare Trust Company, N.A. (the “Reinvestment Plan Agent”) in the respective Trust’s Common Shares pursuant to the Reinvestment Plan. Shareholders who do not participate in the Reinvestment Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street name or other nominee name, then to the nominee) by the Reinvestment Plan Agent, which serves as agent for the shareholders in administering the Reinvestment Plan.

After the Trusts declare a dividend or determine to make a capital gain or other distribution, the Reinvestment Plan Agent will acquire shares for the participants’ accounts, depending upon the following circumstances, either (i) through receipt of unissued but authorized shares from each Trust (“newly issued shares”) or (ii) by purchase of outstanding shares on the open market or on each Trust’s primary exchange (“open market purchases”). If, on the dividend payment date, the net asset value per share (“NAV”) is equal to or less than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market premium”), the Reinvestment Plan Agent will invest the dividend amount in newly issued shares acquired on behalf of the participants. The number of newly issued shares to be credited to each participant’s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the dividend payment date, the dollar amount of the dividend will be divided by 95% of the market price on the dividend payment date. If, on the dividend payment date, the NAV is greater than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market discount”), the Reinvestment Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases. If the Reinvestment Plan Agent is unable to invest the full dividend amount in open market purchases, or if the market discount shifts to a market premium during the purchase period, the Reinvestment Plan Agent will invest any un-invested portion in newly issued shares. Investments in newly issued shares made in this manner would be made pursuant to the same process described above and the date of issue for such newly issued shares will substitute for the dividend payment date.

You may elect not to participate in the Reinvestment Plan and to receive all dividends in cash by contacting the Reinvestment Plan Agent, at the address set forth below.

Participation in the Reinvestment Plan is completely voluntary and may be terminated or resumed at any time without penalty by notice if received and processed by the Reinvestment Plan Agent prior to the dividend record date. Additionally, the Reinvestment Plan Agent seeks to process notices received after the record date but prior to the payable date and such notices often will become effective by the payable date. Where late notices are not processed by the applicable payable date, such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution.

The Reinvestment Plan Agent’s fees for the handling of the reinvestment of distributions will be paid by each Trust. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Reinvestment Plan Agent’s open market purchases in connection with the reinvestment of all distributions. The automatic reinvestment of all distributions will not relieve participants of any U.S. federal, state or local income tax that may be payable on such dividends or distributions.

Each Trust reserves the right to amend or terminate the Reinvestment Plan. There is no direct service charge to participants in the Reinvestment Plan; however, each Trust reserves the right to amend the Reinvestment Plan to include a service charge payable by the participants. Participants in BGR, CII, BDJ, BOE, BGY, BME, BCX and BUI that request a sale of shares are subject to a $0.02 per share sold brokerage commission. Participants in BST that request a sale of shares through the Reinvestment Plan Agent are subject to a $2.50 sales fee and a $0.15 per share fee. Per share fees include any applicable brokerage commissions the Reinvestment Plan Agent is required to pay. All correspondence concerning the Reinvestment Plan should be directed to Computershare Trust Company, N.A. through the internet at http://www.computershare.com/blackrock, or in writing to Computershare, P.O. Box 505000, Louisville, KY 40233, Telephone: (800) 699-1236. Overnight correspondence should be directed to the Reinvestment Plan Agent at Computershare, 462 South 4^th Street, Suite 1600, Louisville, KY 40202.

 

 

130		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trustee and Officer Information

 

Independent Trustees (a)
Name Year of Birth (b)		Position(s) Held (Length of Service) (c)		Principal Occupation(s) During Past Five Years		Number of BlackRock-Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen (d)		Public Company and Other Investment Company Directorships Held During Past Five Years
Richard E. Cavanagh 1946		Chair of the Board and Trustee (Since 2007)		Director, The Guardian Life Insurance Company of America since 1998; Board Chair, Volunteers of America (a not-for-profit organization) from 2015 to 2018 (board member since 2009); Director, Arch Chemical (chemical and allied products) from 1999 to 2011; Trustee, Educational Testing Service from 1997 to 2009 and Chairman thereof from 2005 to 2009; Senior Advisor, The Fremont Group since 2008 and Director thereof since 1996; Faculty Member/Adjunct Lecturer, Harvard University since 2007 and Executive Dean from 1987 to 1995; President and Chief Executive Officer, The Conference Board, Inc. (global business research organization) from 1995 to 2007.		71 RICs consisting of 71 Portfolios		None
Karen P. Robards 1950		Vice Chair of the Board and Trustee (Since 2007)		Principal of Robards & Company, LLC (consulting and private investing) since 1987; Co-founder and Director of the Cooke Center for Learning and Development (a not-for-profit organization) since 1987; Investment Banker at Morgan Stanley from 1976 to 1987.		71 RICs consisting of 71 Portfolios		Greenhill & Co., Inc.; AtriCure, Inc. (medical devices) from 2000 until 2017
Michael J. Castellano 1946		Trustee (Since 2011)		Chief Financial Officer of Lazard Group LLC from 2001 to 2011; Chief Financial Officer of Lazard Ltd from 2004 to 2011; Director, Support Our Aging Religious (non-profit) from 2009 to June 2015 and since 2017; Director, National Advisory Board of Church Management at Villanova University since 2010; Trustee, Domestic Church Media Foundation since 2012; Director, CircleBlack Inc. (financial technology company) since 2015.		71 RICs consisting of 71 Portfolios		None
Cynthia L. Egan 1955		Trustee (Since 2016)		Advisor, U.S. Department of the Treasury from 2014 to 2015; President, Retirement Plan Services for T. Rowe Price Group, Inc. from 2007 to 2012; executive positions within Fidelity Investments from 1989 to 2007.		71 RICs consisting of 71 Portfolios		Unum (insurance); The Hanover Insurance Group (insurance); Envestnet (investment platform) from 2013 until 2016
Frank J. Fabozzi 1948		Trustee (Since 2007)		Editor of The Journal of Portfolio Management since 1986; Professor of Finance, EDHEC Business School (France) since 2011; Visiting Professor, Princeton University for the 2013 to 2014 academic year and Spring 2017 semester; Professor in the Practice of Finance, Yale University School of Management from 1994 to 2011 and currently a Teaching Fellow in Yale’s Executive Programs; affiliated professor Karlsruhe Institute of Technology from 2008 to 2011.		71 RICs consisting of 71 Portfolios		None
R. Glenn Hubbard 1958		Trustee (Since 2007)		Dean, Columbia Business School since 2004; Faculty member, Columbia Business School since 1988.		71 RICs consisting of 71 Portfolios		ADP (data and information services); Metropolitan Life Insurance Company (insurance); KKR Financial Corporation (finance) from 2004 until 2014
W. Carl Kester 1951		Trustee (Since 2007)		George Fisher Baker Jr. Professor of Business Administration, Harvard Business School since 2008, Deputy Dean for Academic Affairs from 2006 to 2010, Chairman of the Finance Unit, from 2005 to 2006, Senior Associate Dean and Chairman of the MBA Program from 1999 to 2005; Member of the faculty of Harvard Business School since 1981.		71 RICs consisting of 71 Portfolios		None

 

 

TRUSTEE AND OFFICER INFORMATION			131

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Trustee and Officer Information  (continued)

 

Independent Trustees (a) (continued)
Name Year of Birth (b)		Position(s) Held (Length of Service) (c)		Principal Occupation(s) During Past Five Years		Number of BlackRock-Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen (d)		Public Company and Other Investment Company Directorships Held During Past Five Years
Catherine A. Lynch 1961		Trustee (Since 2016)		Chief Executive Officer, Chief Investment Officer and various other positions, National Railroad Retirement Investment Trust from 2003 to 2016; Associate Vice President for Treasury Management, The George Washington University from 1999 to 2003; Assistant Treasurer, Episcopal Church of America from 1995 to 1999.		71 RICs consisting of 71 Portfolios		None
Interested Trustees (a)(e)
Name Year of Birth (b)		Position(s) Held (Length of Service) (c)		Principal Occupation(s) During Past Five Years		Number of BlackRock-Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen (d)		Public Company and Other Investment Company Directorships Held During Past Five Years
Robert Fairbairn 1965		Trustee (Since 2018)		Senior Managing Director of BlackRock, Inc. since 2010; oversees BlackRock’s Strategic Partner Program and Strategic Product Management Group; Member of BlackRock’s Global Executive and Global Operating Committees; Co-Chair of BlackRock’s Human Capital Committee; Member of the Board of Managers of BlackRock Investments, LLC since 2011; Global Head of BlackRock’s Retail and iShares® businesses from 2012 to 2016.		127 RICs consisting of 304 Portfolios		None
John M. Perlowski 1964		Trustee (Since 2015) President and Chief Executive Officer (Since 2010)		Managing Director of BlackRock, Inc. since 2009; Head of BlackRock Global Accounting and Product Services since 2009; Advisory Director of Family Resource Network (charitable foundation) since 2009.		127 RICs consisting of 304 Portfolios		None
(a) The address of each Trustee is c/o BlackRock, Inc., 55 East 52nd Street, New York, NY 10055.
(b) Each Independent Trustee will serve until his or her successor is elected and qualifies, or until his or her earlier death, resignation, retirement or removal, or until December 31 of the year in which he or she turns 75. The maximum age limitation may be waived as to any Trustee by action of a majority of the Trustees upon finding of good cause therefor.
(c) Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. (“BlackRock”) in September 2006, the various legacy MLIM and legacy BlackRock fund boards were realigned and consolidated into three new fund boards in 2007. As a result, although the chart shows certain Independent Trustees as joining the Board in 2007, each Trustee first became a member of the boards of other legacy MLIM or legacy BlackRock funds as follows: Richard E. Cavanagh, 1994; Frank J. Fabozzi, 1988; R. Glenn Hubbard, 2004; W. Carl Kester, 1995 and Karen P. Robards, 1998.
(d) For purposes of this chart, “RICs” refers to investment companies registered under the 1940 Act and “Portfolios” refers to the investment programs of the BlackRock-advised funds. The Closed-End Complex is comprised of 71 RICs consisting of 71 Portfolios. Mr. Fairbairn and Mr. Perlowski are also board members of the BlackRock Equity-Bond Complex and the BlackRock Equity-Liquidity Complex.
(e) Mr. Fairbairn and Mr. Perlowski are both “interested persons,” as defined in the 1940 Act, of the Trust based on their positions with BlackRock and its affiliates. Mr. Fairbairn and Mr. Perlowski are also board members of the BlackRock Equity-Bond Complex and the BlackRock Equity-Liquidity Complex. Interested Trustees serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. The maximum age limitation may be waived as to any Trustee by action of a majority of the Trustees upon a finding of good cause therefor.

 

 

132		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Trustee and Officer Information  (continued)

 

 

Officers Who Are Not Trustees (a)
Name Year of Birth (b)		Position(s) Held (Length of Service)		Principal Occupation(s) During Past Five Years
Jonathan Diorio 1980		Vice President (Since 2015)		Managing Director of BlackRock, Inc. since 2015; Director of BlackRock, Inc. from 2011 to 2015.
Neal J. Andrews 1966		Chief Financial Officer (Since 2007)		Managing Director of BlackRock, Inc. since 2006.
Jay M. Fife 1970		Treasurer (Since 2007)		Managing Director of BlackRock, Inc. since 2007.
Charles Park 1967		Chief Compliance Officer (Since 2014)		Anti-Money Laundering Compliance Officer for the BlackRock-advised Funds in the Equity-Bond Complex, the Equity-Liquidity Complex and the Closed-End Complex from 2014 to 2015; Chief Compliance Officer of BlackRock Advisors, LLC and the BlackRock-advised Funds in the Equity-Bond Complex, the Equity-Liquidity Complex and the Closed-End Complex since 2014; Principal of and Chief Compliance Officer for iShares® Delaware Trust Sponsor LLC since 2012 and BlackRock Fund Advisors (“BFA”) since 2006; Chief Compliance Officer for the BFA-advised iShares® exchange traded funds since 2006; Chief Compliance Officer for BlackRock Asset Management International Inc. since 2012.
Janey Ahn 1975		Secretary (Since 2012)		Managing Director of BlackRock, Inc. since 2018; Director of BlackRock, Inc. from 2009 to 2017.
(a) The address of each Officer is c/o BlackRock, Inc., 55 East 52nd Street, New York, NY 10055.
(b) Officers of the Trust serve at the pleasure of the Board.

 

 

 

(a)	For BGR, BOE, BGY, BCX and BUI.

(b)

For BME.

 

 

TRUSTEE AND OFFICER INFORMATION			133

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Additional Information

 

The Annual Meeting of Shareholders was held on July 30, 2018 for shareholders of record on May 31, 2018, to elect trustee nominees for each Trust. There were no broker non-votes with regard to any of the Trusts.

Shareholders elected the Class II Trustees & Class III Trustee as follows:

 

		Frank J. Fabozzi (a)								Robert Fairbairn (b)								Catherine A. Lynch (a)								Karen P. Robards (a)
		Votes For				Votes Withheld				Votes For				Votes Withheld				Votes For				Votes Withheld				Votes For				Votes Withheld
BDJ			168,103,932				7,652,038				173,568,079				2,187,891				173,787,777				1,968,193				173,693,401				2,062,569
BGR			27,342,989				372,839				27,339,046				376,782				27,349,982				365,846				27,369,145				346,683
BOE			63,981,952				924,584				64,038,943				867,593				64,011,922				894,614				63,974,636				931,900
BME			8,386,414				178,525				8,407,706				157,233				8,437,822				127,117				8,436,583				128,356
BGY			101,925,346				1,204,835				101,968,411				1,161,770				101,954,236				1,175,945				101,924,950				1,205,231
BCX			87,875,471				1,695,256				88,115,332				1,455,395				88,133,278				1,437,449				87,985,923				1,584,804
BUI			15,385,726				309,882				15,398,351				297,257				15,392,505				303,103				15,373,175				322,433
BST			20,874,276				367,818				20,858,996				383,098				20,909,521				332,573				20,907,246				334,848

 

(a)

Class II Trustee.

(b)

Class III Trustee.

For the Trusts listed above, Trustees whose term of office continued after the Annual Meeting of Shareholders because they were not up for election are Michael J. Castellano, Richard E. Cavanagh, Cynthia L. Egan, R. Glenn Hubbard, John M. Perlowski and W. Carl Kester.

The adjourned Annual Meeting of Shareholders was held on August 27, 2018 for shareholders of record on May 31, 2018, to elect director nominees for BlackRock Enhanced Capital and Income Fund, Inc. There were no broker non-votes with regard to the Fund.

Shareholders elected the Class II Directors & Class III Director as follows:

 

Robert Fairbairn (a)

R. Glenn Hubbard (b)

W. Carl Kester (b)

John M. Perlowski (b)

Karen P. Robards (b)

Votes For

Votes Withheld

Votes For

Votes Withheld

Votes For

Votes Withheld

Votes For

Votes Withheld

Votes For

Votes Withheld

CII

40,306,480

1,622,889

40,337,202

1,592,167

40,380,971

1,548,398

40,398,323

1,531,046

40,447,283

1,482,086

 

(a)

Class III Trustee.

(b)

Class II Trustee.

For the Fund listed above, Directors whose term of office continued after the Annual Meeting of Shareholders because they were not up for election are Michael J. Castellano, Richard E. Cavanagh, Cynthia L. Egan, Frank J. Fabozzi, and Catherine A. Lynch.

Fund Certification

The Trusts are listed for trading on the NYSE and have filed with the NYSE their annual chief executive officer certification regarding compliance with the NYSE’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, other than BME, do not make available copies of their Statements of Additional Information because the Trusts’ shares, except for BME, are not continuously offered, which means that the Statements of Additional Information of each Trust, other than BME, have not been updated after completion of the respective Trust’s offerings and the information contained in each such Trust’s Statement of Additional Information may have become outdated.

BME’s Statement of Additional Information includes additional information about its Board and is available without charge upon request by calling 1-800-882-0052.

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.

In accordance with Section 23(c) of the Investment Company Act of 1940, each Trust may from time to time purchase shares of its common stock in the open market or in private transactions.

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. Any reference to BlackRock’s website in this report 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.

 

 

134		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Additional Information  (continued)

 

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 Advisers, Banks or Brokerages:

Please contact your financial advisor. Please note that not all investment advisers, banks or brokerages may offer this service.

Householding

The Trusts will mail only one copy of shareholder documents, 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 (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. 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 upon request and without charge (1) by calling (800) 882-0052; (2) at http://www.blackrock.com; and (3) on the SEC’s website 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 as well as certain other material information as necessary from time to time. Investors and others are advised to 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.

Shelf Offering Program

From time-to-time, each Trust may seek to raise additional equity capital through an equity shelf program (a “Shelf Offering”). In a Shelf Offering, a Trust 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 the Trust’s net asset value (“NAV”) per Common Share (calculated within 48 hours of pricing). While any such Shelf Offering may allow a Trust 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.

None of the Trusts, other than BME, have filed a registration statement with respect to any current Shelf Offerings. This report is not an offer to sell these Trusts” Common Shares and is not a solicitation of an offer to buy these Trusts” Common Shares. If any of the Trusts other than BME file a registration statement with respect to any current Shelf Offering, the prospectus contained therein will contain more complete information about such Trusts and should be read carefully before investing.

BME has filed a final prospectus with the SEC in connection with its Shelf Offering. This report and the prospectus of BME are not offers to sell BME Common Shares or solicitations of an offer to buy BME Common Shares in any jurisdiction where such offers or sales are not permitted. The prospectus of BME contains important information about the Trust, including its investment objective, risks, charges and expenses. Investors are urged to read the prospectus of BME carefully and in its entirety before investing. Copies of the final prospectus for BME can be obtained from BlackRock at http://www.blackrock.com.

 

ADDITIONAL INFORMATION			135

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Additional Information  (continued)

 

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 distributions 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 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. 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		2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS

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Glossary of Terms Used in this Report

 

 

 

GLOSSARY OF TERMS USED IN THIS REPORT			137

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This report is intended for current holders. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. Statements and other information herein are as dated and are subject to change.

 

 

 

CEF-BK9-12/18-AR

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Item 2 –

Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. During the period covered by this report, the code of ethics was amended to update certain information and to make other non-material changes. During the period covered by this report, there have been no waivers granted under the code of ethics. The registrant undertakes to provide a copy of the code of ethics to any person upon request, without charge, who calls 1-800-882-0052, option 4.

 

Item 3 –

Audit Committee Financial Expert – The registrant’s board of directors (the “board of directors”), has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:

Michael Castellano

Frank J. Fabozzi

Henry Gabbay

Catherine A. Lynch

Karen P. Robards

The registrant’s board of directors has determined that Karen P. Robards qualifies as a financial expert pursuant to Item 3(c)(4) of Form N-CSR.

Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been principal of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.

 

Item 4 –

Principal Accountant Fees and Services

The following table presents fees billed by Deloitte & Touche LLP (“D&T”) in each of the last two fiscal years for the services rendered to the Fund:

 

2

---

(a) Audit Fees

(b) Audit-Related Fees1

(c) Tax Fees2

(d) All Other Fees3

Entity Name

Current Fiscal   Year End

Previous   Fiscal Year   End

Current Fiscal   Year End

Previous   Fiscal Year   End

Current   Fiscal Year   End

Previous   Fiscal Year   End

Current   Fiscal Year   End

Previous   Fiscal Year   End

BlackRock Enhanced Equity Dividend Trust

$57,324

$57,290

$0

$7,500

$19,700

$15,147

$0

$0

The following table presents fees billed by D&T that were required to be approved by the registrant’s audit committee (the “Committee”) for services that relate directly to the operations or financial reporting of the Fund and that are rendered on behalf of BlackRock Advisors, LLC ( the “Investment Adviser” or “BlackRock”) and entities controlling, controlled by, or under common control with BlackRock (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the Fund (“Affiliated Service Providers”):

 

		Current Fiscal Year End		Previous Fiscal Year End
(b) Audit-Related Fees1		$0		$0
(c) Tax Fees2		$0		$0
(d) All Other Fees3		$2,274,000		$2,129,000

1

The nature of the services includes assurance and related services reasonably related to the performance of the audit or review of financial statements not included in Audit Fees, including accounting consultations, agreed-upon procedure reports, attestation reports, comfort letters, out-of-pocket expenses and internal control reviews not required by regulators.

2	The nature of the services includes tax compliance and/or tax preparation, including services relating to the filing or amendment of federal, state or local income tax returns, regulated investment company qualification reviews, taxable income and tax distribution calculations.

3

Non-audit fees of $2,274,000 and $2,129,000 for the current fiscal year and previous fiscal year, respectively, were paid to the Fund’s principal accountant in their entirety by BlackRock, in connection with services provided to the Affiliated Service Providers of the Fund and of certain other funds sponsored and advised by BlackRock or its affiliates for a service organization review and an accounting research tool subscription. These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(e)(1) Audit Committee Pre-Approval Policies and Procedures:

The Committee has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the Investment Adviser and Affiliated Service Providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are (a) consistent with the SEC’s auditor independence rules and (b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operations or financial reporting of the registrant will only be deemed pre-approved provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 per project. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.

Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved

 

3

---

subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to the Committee Chairman the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g) The aggregate non-audit fees, defined as the sum of the fees shown under “Audit-Related Fees,” “Tax Fees” and “All Other Fees,” paid to the accountant for services rendered by the accountant to the registrant, the Investment Adviser and the Affiliated Service Providers were:

 

Entity Name		Current Fiscal Year         End		Previous Fiscal Year         End
BlackRock Enhanced Equity Dividend Trust		$19,700		$22,647

Additionally, the amounts billed by D&T in connection with services provided to the Affiliated Service Providers of the Fund and of other funds sponsored or advised by BlackRock or its affiliates during the current and previous fiscal years for a service organization review and an accounting research tool subscription were:

 

Current Fiscal     Year End		Previous Fiscal     Year End
$2,274,000		$2,129,000

These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(h) The Committee has considered and determined that the provision of non-audit services that were rendered to the Investment Adviser, and the Affiliated Service Providers that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

 

Item 5 –

Audit Committee of Listed Registrants

 

(a)

The following individuals are members of the registrant’s separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):

Michael Castellano

Frank J. Fabozzi

Henry Gabbay

Catherine A. Lynch

Karen P. Robards

 

4

---

(b)

Not Applicable

 

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 – The board of directors has delegated the voting of proxies for the Fund’s portfolio securities to the Investment Adviser pursuant to the Investment Adviser’s proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies related to Fund securities in the best interests of the Fund and its stockholders. From time to time, a vote may present a conflict between the interests of the Fund’s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the Investment Adviser, on the other. In such event, provided that the Investment Adviser’s Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight Committee”) is aware of the real or potential conflict or material non-routine matter and if the Oversight Committee does not reasonably believe it is able to follow its general voting guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote impartially, the Oversight Committee may retain an independent fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s clients. If the Investment Adviser determines not to retain an independent fiduciary, or does not desire to follow the advice of such independent fiduciary, the Oversight Committee shall determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio Management Group and/or the Investment Adviser’s Legal and Compliance Department and concluding that the vote cast is in its client’s best interest notwithstanding the conflict. A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit 99.PROXYPOL. Information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, (i) at www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

 

Item 8 –

Portfolio Managers of Closed-End Management Investment Companies

(a)(1) As of the date of filing this Report:

The registrant is managed by a team of investment professionals comprised Kyle G. McClements, CFA, Managing Director at BlackRock, Christopher Accettella, Director at BlackRock, Tony DeSpirito, Managing Director at BlackRock, Franco Tapia, CFA, Managing Director at BlackRock and David Zhao, Managing Director at BlackRock. Messrs. McClements, Accettella, DeSpirito, Tapia and Zhao are the Fund’s portfolio managers and are responsible for the day-to-day management of the Fund’s portfolio and the selection of its investments. Messrs. McClements, Accettella and DeSpirito have been members of the Fund’s portfolio management team since 2005, 2012 and 2014, respectively. Messrs. Tapia and Zhao have been members of the Fund’s portfolio management team since 2017.

 

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Portfolio Manager		Biography
Kyle G. McClements, CFA		Managing Director of BlackRock since 2009; Director of BlackRock from 2006 to 2008; Vice President of BlackRock in 2005; Vice President of State Street Research & Management from 2004 to 2005.
Christopher Accettella		Director of BlackRock since 2008; Vice President of BlackRock, Inc. from 2005 to 2008.
Tony DeSpirito		Managing Director of BlackRock, Inc. since 2014; Managing Principal, Portfolio Manager and Member of the Executive Committee of Pzena Investment Management from 2009 to 2014.
Franco Tapia, CFA		Managing Director of BlackRock, Inc. since 2016; Senior Equity Research Analyst and Portfolio Manager at Pzena Investment Management from 2006 to 2016.
David Zhao		Managing Director of BlackRock, Inc. since 2016; Global Equity Senior Research Analyst and Principal at Pzena Investment Management from 2006 to 2016.

(a)(2)         As of December 31, 2018:

 

 

(iv)

Portfolio Manager Potential Material Conflicts of Interest

BlackRock has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees),

which may be the same as or different from those made to the Fund. In addition,

 

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BlackRock, Inc., its affiliates and significant shareholders and any officer, director, shareholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, Inc., or any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock, Inc.’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock, Inc. or any of its affiliates or significant shareholders or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information. Certain portfolio managers also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a fund. It should also be noted that a portfolio manager may be managing hedge fund and/or long only accounts, or may be part of a team managing hedge fund and/or long only accounts, subject to incentive fees. Such portfolio managers may therefore be entitled to receive a portion of any incentive fees earned on such accounts. Currently, the portfolio managers of this Fund are not entitled to receive a portion of incentive fees of other accounts.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment. To this end, BlackRock, Inc. has adopted policies that are intended to ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.

(a)(3) As of December 31, 2018:

Portfolio Manager Compensation Overview

The discussion below describes the portfolio managers’ compensation as of December 31, 2018.

BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career path emphasis at all levels reflect the value senior management places on key resources. Compensation may include a variety of components and may vary from year to year based on a number of factors. The principal components of compensation include a base salary, a performance-based discretionary bonus, participation in various benefits programs and one or more of the incentive compensation programs established by BlackRock.

Base Compensation. Generally, portfolio managers receive base compensation based on their position with the firm.

Discretionary Incentive Compensation - Messrs. Accettella and McClements

Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets or strategies under management or supervision by that portfolio manager, and/or the individual’s performance and contribution to the overall

 

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performance of these portfolios and BlackRock. Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio manager’s compensation based on the performance of the funds, other accounts or strategies managed by each portfolio manager. Performance is generally measured on a pre-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. The performance of some funds, other accounts or strategies may not be measured against a specific benchmark.

Discretionary Incentive Compensation - Messrs. DeSpirito, Tapia and Zhao

Generally, discretionary incentive compensation for Active Equity portfolio managers is based on a formulaic compensation program. BlackRock’s formulaic portfolio manager compensation program is based on team revenue and pre-tax investment performance relative to appropriate competitors or benchmarks over 1-, 3- and 5-year performance periods, as applicable. In most cases, these benchmarks are the same as the benchmark or benchmarks against which the performance of the funds or other accounts managed by the portfolio managers are measured. BlackRock’s Chief Investment Officers determine the benchmarks or rankings against which the performance of funds and other accounts managed by each portfolio management team is compared and the period of time over which performance is evaluated. With respect to these portfolio managers, such benchmarks for the Fund and other accounts are: Russell 1000 Value Index (Total Return); S&P United States MidSmallCap Index; S&P US MidSmallCap Index (GBP); Russell 1000 Value Index TR in GBP; 50% SNP500NR2/50% SP5100OW Index; Russell MidCap Value Index; BDJ Option Overwriting Strategy Composite Index; S&P 500 Net Dividends Reinvested Index (Net USD); Russell 1000 Index (Gross Total Return); Russell 1000 Index (GBP); SNP500 - CII_EQ Overwrite Benchmark Strategy; Russell 1000, expressed in EUR; Russell 1000 Value TR Customized Index Performance Benchmark JPY; MSCI All Country (AC) Americas Index.

A smaller element of portfolio manager discretionary compensation may include consideration of: financial results, expense control, profit margins, strategic planning and implementation, quality of client service, market share, corporate reputation, capital allocation, compliance and risk control, leadership, technology and innovation. These factors are considered collectively by BlackRock management and the relevant Chief Investment Officers.

Distribution of Discretionary Incentive Compensation. Discretionary incentive compensation is distributed to portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards that notionally track the return of certain BlackRock investment products.

Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest pursuant to the terms of the applicable plan and, once

 

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vested, settle in BlackRock, Inc. common stock. The portfolio managers of this Fund have deferred BlackRock, Inc. stock awards.

For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage, which provides direct alignment of portfolio manager discretionary incentive compensation with investment product results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only portfolio managers who manage specified products and whose total compensation is above a specified threshold are eligible to participate in the deferred cash award program.

Other Compensation Benefits. In addition to base salary and discretionary incentive compensation, portfolio managers may be eligible to receive or participate in one or more of the following:

Incentive Savings Plans — BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock, Inc. employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit ($275,000 for 2018). The RSP offers a range of investment options, including registered investment companies and collective investment funds managed by the firm. BlackRock, Inc. contributions follow the investment direction set by participants for their own contributions or, absent participant investment direction, are invested into a target date fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for investment in BlackRock, Inc. common stock at a 5% discount on the fair market value of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of $25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to participate in these plans.

(a)(4) Beneficial Ownership of Securities – As of December 31, 2018.

 

Portfolio Manager		Dollar Range of Equity Securities of the Fund Beneficially Owned
Kyle McClements, CFA		$50,001 - $100,000
Christopher Accettella		$1 - $10,000
Tony DeSpirito		$100,001 - $500,000
Franco Tapia, CFA		None
David Zhao		None

(b) Not Applicable

 

Item 9 –

Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

 

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¹On September 6, 2017, the Fund announced a continuation of the open market share repurchase program, pursuant to which the Fund may repurchase through November 30, 2018 up to 5% of its outstanding shares based on common shares outstanding on November 30, 2017, in open market transactions. On September 7, 2018, the Fund announced a further continuation of its open market share repurchase program. Commencing on December 1, 2018, the Fund may repurchase through November 30, 2019, up to 5% of its common shares outstanding as of the close of business on November 30, 2018, subject to certain conditions.

 

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 –

Disclosure of Securities Lending Activities for Closed-End Management Investment Companies

(a) The following table shows the dollar amounts of income, and dollar amounts of fees and/or compensation paid, relating to the Fund’s securities lending activities during the fiscal year ended December 31, 2018.

 

		BlackRock Enhanced Equity Dividend Trust
(1)		Gross income from securities lending activities					$1,040
(2)		Fees and/or compensation for securities lending activities and related services
		(a)		Securities lending income paid to BIM for services as securities lending agent			$205
		(b)		Collateral management expenses (including fees deducted from a polled cash collateral vehicle) not included in (a)			$1
		(c)		Administrative fees not included in (a)			$0
		(d)		Indemnification fees not included in (a)			$0

 

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		(e)		Rebate (paid to borrowers)			$12
		(f)		Other fees not included in (a)			$0
(3)		Aggregate fees/compensation for securities lending activities					$218
(4)		Net income from securities lending activities					$822

(b) BlackRock Investment Management, LLC (“BIM”) serves as securities lending agent for the Fund and in that role administers the Fund’s securities lending program pursuant to the terms of a securities lending agency agreement entered into between the Fund and BIM.

 

Item 13 –

Exhibits attached hereto

(a)(1) – Code of Ethics – See Item 2

(a)(2) – Certifications – Attached hereto

(a)(3) – Not Applicable

(a)(4) – Not Applicable

(b) – Certifications – Attached hereto

(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.

 

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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 Enhanced Equity Dividend Trust
By:		/s/ John M. Perlowski
		John M. Perlowski
		Chief Executive Officer (principal executive officer) of
		BlackRock Enhanced Equity Dividend Trust

Date: March 8, 2019

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 Enhanced Equity Dividend Trust

Date: March 8, 2019

 

By:		/s/ Neal J. Andrews
		Neal J. Andrews
		Chief Financial Officer (principal financial officer) of
		BlackRock Enhanced Equity Dividend Trust

Date: March 8, 2019

 

 

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