Eaton Vance Tax-Managed Buy-Write Income Fund

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

811-21676

Investment Company Act File Number

Eaton Vance Tax-Managed Buy-Write Income Fund

(Exact Name of Registrant as Specified in Charter)

Two International Place, Boston, Massachusetts 02110

(Address of Principal Executive Offices)

Maureen A. Gemma

Two International Place, Boston, Massachusetts 02110

(Name and Address of Agent for Services)

(617) 482-8260

(Registrant’s Telephone Number, Including Area Code)

December 31

Date of Fiscal Year End

September 30, 2017

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

Eaton Vance

Tax-Managed Buy-Write Income Fund

September 30, 2017

PORTFOLIO OF INVESTMENTS (Unaudited)

Common Stocks — 99.4%

 

                                                 
Security    Shares      Value  

Aerospace & Defense — 3.2%

      

Boeing Co. (The)

      17,785      $ 4,521,125  

Northrop Grumman Corp.

      14,544        4,184,600  

Textron, Inc.

      11,648        627,594  

United Technologies Corp.

      33,319        3,867,669  
     

 

 

  
      $ 13,200,988  
     

 

 

  

Air Freight & Logistics — 0.1%

      

C.H. Robinson Worldwide, Inc.

      5,324      $ 405,156  
     

 

 

  
      $ 405,156  
     

 

 

  

Airlines — 0.6%

      

American Airlines Group, Inc.

      6,381      $ 303,034  

Southwest Airlines Co.

      36,616        2,049,763  
     

 

 

  
      $ 2,352,797  
     

 

 

  

Auto Components — 0.3%

      

Goodyear Tire & Rubber Co. (The)

      3,713      $ 123,457  

Lear Corp.

      7,250        1,254,830  
     

 

 

  
      $ 1,378,287  
     

 

 

  

Banks — 6.8%

      

Bank of America Corp.

      96,896      $ 2,455,345  

Citigroup, Inc.

      84,167        6,122,307  

Fifth Third Bancorp

      57,446        1,607,339  

JPMorgan Chase & Co.

      85,013        8,119,592  

KeyCorp

      85,122        1,601,996  

M&T Bank Corp.

      5,096        820,660  

PNC Financial Services Group, Inc. (The)

      14,818        1,997,022  

SunTrust Banks, Inc.

      5,538        331,006  

Wells Fargo & Co.

      86,859        4,790,274  
     

 

 

  
      $ 27,845,541  
     

 

 

  

Beverages — 2.4%

      

Coca-Cola Co. (The)

      122,893      $ 5,531,414  

PepsiCo, Inc.

      38,171        4,253,394  
     

 

 

  
      $ 9,784,808  
     

 

 

  

Biotechnology — 3.6%

      

AbbVie, Inc.

      19,355      $ 1,719,885  

Alexion Pharmaceuticals, Inc.(1)

      3,580        502,238  

Amgen, Inc.

      18,988        3,540,313  

Celgene Corp.(1)

      37,323        5,442,440  

Gilead Sciences, Inc.

      38,604        3,127,696  

Vertex Pharmaceuticals, Inc.(1)

      1,850        281,274  
     

 

 

  
      $ 14,613,846  
     

 

 

  

Building Products — 0.1%

      

Johnson Controls International PLC

      5,900      $ 237,711  
     

 

 

  
      $ 237,711  
     

 

 

  

 

1

 

 

                                                 
Security    Shares      Value  

Capital Markets — 2.1%

      

Invesco, Ltd.

      38,480      $ 1,348,339  

Lazard, Ltd., Class A

      9,511        430,087  

Legg Mason, Inc.

      3,441        135,266  

S&P Global, Inc.

      24,855        3,885,085  

State Street Corp.

      27,413        2,619,038  
     

 

 

  
      $ 8,417,815  
     

 

 

  

Chemicals — 2.4%

      

AdvanSix, Inc.(1)

      1,530      $ 60,818  

DowDuPont, Inc.

      87,450        6,054,163  

Eastman Chemical Co.

      3,608        326,488  

Ingevity Corp.(1)

      2,787        174,104  

Sherwin-Williams Co. (The)

      9,183        3,287,881  
     

 

 

  
      $ 9,903,454  
     

 

 

  

Commercial Services & Supplies — 0.1%

      

Waste Management, Inc.

      4,649      $ 363,877  
     

 

 

  
      $ 363,877  
     

 

 

  

Communications Equipment — 0.9%

      

Brocade Communications Systems, Inc.

      42,403      $ 506,716  

Cisco Systems, Inc.

      98,957        3,327,924  
     

 

 

  
      $ 3,834,640  
     

 

 

  

Consumer Finance — 1.2%

      

American Express Co.

      23,394      $ 2,116,221  

Discover Financial Services

      40,754        2,627,818  
     

 

 

  
      $ 4,744,039  
     

 

 

  

Containers & Packaging — 0.6%

      

Avery Dennison Corp.

      15,307      $ 1,505,290  

WestRock Co.

      16,727        948,923  
     

 

 

  
      $ 2,454,213  
     

 

 

  

Distributors — 0.6%

      

Genuine Parts Co.

      27,494      $ 2,629,801  
     

 

 

  
      $ 2,629,801  
     

 

 

  

Diversified Financial Services — 1.1%

      

Berkshire Hathaway, Inc., Class B(1)

      24,462      $ 4,484,374  
     

 

 

  
      $ 4,484,374  
     

 

 

  

Diversified Telecommunication Services — 1.7%

      

AT&T, Inc.

      126,442      $ 4,952,733  

Level 3 Communications, Inc.(1)

      5,417        288,672  

Verizon Communications, Inc.

      36,516        1,807,177  
     

 

 

  
      $ 7,048,582  
     

 

 

  

Electric Utilities — 1.3%

      

Duke Energy Corp.

      23,843      $ 2,000,904  

Edison International

      20,090        1,550,345  

Exelon Corp.

      5,174        194,905  

Pinnacle West Capital Corp.

      7,168        606,126  

Southern Co. (The)

      9,121        448,206  

Xcel Energy, Inc.

      12,009        568,266  
     

 

 

  
      $ 5,368,752  
     

 

 

  

 

2

 

 

                                                 
Security    Shares      Value  

Electrical Equipment — 0.5%

      

Emerson Electric Co.

      32,303      $ 2,029,921  
     

 

 

  
      $ 2,029,921  
     

 

 

  

Energy Equipment & Services — 1.0%

      

Halliburton Co.

      30,502      $ 1,404,007  

Schlumberger, Ltd.

      39,317        2,742,754  
     

 

 

  
      $ 4,146,761  
     

 

 

  

Equity Real Estate Investment Trusts (REITs) — 1.9%

      

Apartment Investment & Management Co., Class A

      12,428      $ 545,092  

AvalonBay Communities, Inc.

      11,002        1,962,977  

Equity Residential

      16,427        1,083,032  

Host Hotels & Resorts, Inc.

      58,590        1,083,329  

Kimco Realty Corp.

      78,276        1,530,296  

ProLogis, Inc.

      22,296        1,414,904  

Realty Income Corp.

      4,920        281,375  
     

 

 

  
      $ 7,901,005  
     

 

 

  

Food & Staples Retailing — 1.0%

      

Costco Wholesale Corp.

      802      $ 131,761  

CVS Health Corp.

      47,515        3,863,920  

Wal-Mart Stores, Inc.

      1,859        145,262  
     

 

 

  
      $ 4,140,943  
     

 

 

  

Food Products — 1.4%

      

Kellogg Co.

      14,423      $ 899,563  

Kraft Heinz Co. (The)

      10,250        794,887  

Mondelez International, Inc., Class A

      46,954        1,909,150  

Tyson Foods, Inc., Class A

      28,696        2,021,633  
     

 

 

  
      $ 5,625,233  
     

 

 

  

Health Care Equipment & Supplies — 2.7%

      

Abbott Laboratories

      83,518      $ 4,456,520  

Baxter International, Inc.

      37,878        2,376,845  

Stryker Corp.

      26,801        3,806,278  

Zimmer Biomet Holdings, Inc.

      4,721        552,782  
     

 

 

  
      $ 11,192,425  
     

 

 

  

Health Care Providers & Services — 1.9%

      

AmerisourceBergen Corp.

      2,394      $ 198,104  

Centene Corp.(1)

      7,212        697,905  

UnitedHealth Group, Inc.

      34,167        6,691,607  
     

 

 

  
      $ 7,587,616  
     

 

 

  

Hotels, Restaurants & Leisure — 1.7%

      

Marriott International, Inc., Class A

      12,488      $ 1,376,927  

Marriott Vacations Worldwide Corp.

      2,064        257,030  

McDonald’s Corp.

      25,653        4,019,312  

Wyndham Worldwide Corp.

      11,235        1,184,281  
     

 

 

  
      $ 6,837,550  
     

 

 

  

Household Durables — 1.0%

      

Leggett & Platt, Inc.

      11,383      $ 543,310  

Lennar Corp., Class A

      18,642        984,298  

Newell Brands, Inc.

      61,788        2,636,494  
     

 

 

  
      $ 4,164,102  
     

 

 

  

 

3

 

 

                                                 
Security    Shares      Value  

Household Products — 1.4%

      

Clorox Co. (The)

      6,843      $ 902,660  

Kimberly-Clark Corp.

      19,850        2,335,948  

Procter & Gamble Co. (The)

      28,780        2,618,405  
     

 

 

  
      $ 5,857,013  
     

 

 

  

Industrial Conglomerates — 3.1%

      

3M Co.

      21,663      $ 4,547,064  

General Electric Co.

      126,568        3,060,414  

Honeywell International, Inc.

      36,462        5,168,124  
     

 

 

  
      $ 12,775,602  
     

 

 

  

Insurance — 4.3%

      

Allstate Corp. (The)

      39,736      $ 3,652,136  

Brighthouse Financial, Inc.(1)

      622        37,818  

Chubb, Ltd.

      4,669        665,566  

Cincinnati Financial Corp.

      18,908        1,447,786  

Lincoln National Corp.

      45,091        3,313,287  

Marsh & McLennan Cos., Inc.

      49,000        4,106,690  

MetLife, Inc.

      6,849        355,805  

Principal Financial Group, Inc.

      29,001        1,865,924  

Prudential Financial, Inc.

      14,482        1,539,726  

Travelers Cos., Inc. (The)

      3,902        478,073  
     

 

 

  
      $ 17,462,811  
     

 

 

  

Internet & Direct Marketing Retail — 2.4%

      

Amazon.com, Inc.(1)

      5,154      $ 4,954,798  

Netflix, Inc.(1)

      4,333        785,790  

Priceline Group, Inc. (The)(1)

      1,797        3,289,983  

Shutterfly, Inc.(1)

      19,125        927,180  
     

 

 

  
      $ 9,957,751  
     

 

 

  

Internet Software & Services — 5.9%

      

Alphabet, Inc., Class A(1)

      7,805      $ 7,599,885  

Alphabet, Inc., Class C(1)

      7,534        7,225,935  

Facebook, Inc., Class A(1)

      36,074        6,163,964  

VeriSign, Inc.(1)

      27,256        2,899,766  
     

 

 

  
      $ 23,889,550  
     

 

 

  

IT Services — 3.3%

      

Fidelity National Information Services, Inc.

      26,132      $ 2,440,468  

International Business Machines Corp.

      25,768        3,738,421  

Mastercard, Inc., Class A

      40,405        5,705,186  

Visa, Inc., Class A

      13,804        1,452,733  
     

 

 

  
      $ 13,336,808  
     

 

 

  

Life Sciences Tools & Services — 1.2%

      

Thermo Fisher Scientific, Inc.

      24,689      $ 4,671,159  
     

 

 

  
      $ 4,671,159  
     

 

 

  

Machinery — 0.9%

      

Caterpillar, Inc.

      2,706      $ 337,465  

Dover Corp.

      6,336        579,047  

Pentair PLC

      5,479        372,353  

Snap-on, Inc.

      6,380        950,684  

Stanley Black & Decker, Inc.

      8,690        1,311,929  
     

 

 

  
      $ 3,551,478  
     

 

 

  

 

4

 

 

                                                 
Security    Shares      Value  

Media — 3.2%

      

Comcast Corp., Class A

      156,000      $ 6,002,880  

Time Warner, Inc.

      15,261        1,563,489  

Walt Disney Co. (The)

      54,115        5,334,116  
     

 

 

  
      $ 12,900,485  
     

 

 

  

Metals & Mining — 0.4%

      

Newmont Mining Corp.

      8,457      $ 317,222  

Nucor Corp.

      25,287        1,417,084  
     

 

 

  
      $ 1,734,306  
     

 

 

  

Multi-Utilities — 1.9%

      

Centerpoint Energy, Inc.

      14,223      $ 415,454  

CMS Energy Corp.

      65,445        3,031,412  

Dominion Energy, Inc.

      1,997        153,629  

DTE Energy Co.

      10,342        1,110,317  

NiSource, Inc.

      49,999        1,279,475  

Public Service Enterprise Group, Inc.

      34,219        1,582,629  
     

 

 

  
      $ 7,572,916  
     

 

 

  

Multiline Retail — 0.5%

      

Kohl’s Corp.

      24,562      $ 1,121,255  

Macy’s, Inc.

      48,228        1,052,335  
     

 

 

  
      $ 2,173,590  
     

 

 

  

Oil, Gas & Consumable Fuels — 5.3%

      

Andeavor

      19,643      $ 2,026,175  

Chevron Corp.

      52,511        6,170,042  

EOG Resources, Inc.

      25,247        2,442,395  

Exxon Mobil Corp.

      55,608        4,558,744  

Newfield Exploration Co.(1)

      74,168        2,200,565  

Phillips 66

      24,334        2,229,238  

Williams Cos., Inc. (The)

      68,677        2,060,997  
     

 

 

  
      $ 21,688,156  
     

 

 

  

Personal Products — 0.1%

      

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

      3,326      $ 358,676  
     

 

 

  
      $ 358,676  
     

 

 

  

Pharmaceuticals — 4.9%

      

Bristol-Myers Squibb Co.

      70,886      $ 4,518,274  

Johnson & Johnson

      51,433        6,686,804  

Merck & Co., Inc.

      81,604        5,225,104  

Pfizer, Inc.

      98,440        3,514,308  
     

 

 

  
      $ 19,944,490  
     

 

 

  

Professional Services — 0.2%

      

ManpowerGroup, Inc.

      1,193      $ 140,559  

Robert Half International, Inc.

      13,943        701,891  
     

 

 

  
      $ 842,450  
     

 

 

  

Real Estate Management & Development — 0.1%

      

CBRE Group, Inc., Class A(1)

      8,158      $ 309,025  
     

 

 

  
      $ 309,025  
     

 

 

  

Road & Rail — 1.3%

      

J.B. Hunt Transport Services, Inc.

      3,521      $ 391,113  

Kansas City Southern

      11,539        1,254,058  

 

5

 

 

                                                 
Security    Shares      Value  

Norfolk Southern Corp.

      27,357      $ 3,617,690  
     

 

 

  
      $ 5,262,861  
     

 

 

  

Semiconductors & Semiconductor Equipment — 3.6%

      

Analog Devices, Inc.

      16,160      $ 1,392,507  

Applied Materials, Inc.

      15,313        797,654  

Broadcom, Ltd.

      8,718        2,114,464  

Intel Corp.

      49,395        1,880,962  

NVIDIA Corp.

      24,772        4,428,490  

QUALCOMM, Inc.

      53,656        2,781,527  

Teradyne, Inc.

      32,470        1,210,806  
     

 

 

  
      $ 14,606,410  
     

 

 

  

Software — 4.6%

      

Microsoft Corp.

      187,543      $ 13,970,078  

Oracle Corp.

      93,841        4,537,213  

salesforce.com, inc.(1)

      1,398        130,601  
     

 

 

  
      $ 18,637,892  
     

 

 

  

Specialty Retail — 2.1%

      

Advance Auto Parts, Inc.

      3,365      $ 333,808  

Home Depot, Inc. (The)

      42,304        6,919,242  

Tiffany & Co.

      14,641        1,343,751  
     

 

 

  
      $ 8,596,801  
     

 

 

  

Technology Hardware, Storage & Peripherals — 4.5%

      

Apple, Inc.

      117,689      $ 18,138,229  
     

 

 

  
      $ 18,138,229  
     

 

 

  

Textiles, Apparel & Luxury Goods — 0.5%

      

Coach, Inc.

      10,331      $ 416,133  

NIKE, Inc., Class B

      30,243        1,568,099  
     

 

 

  
      $ 1,984,232  
     

 

 

  

Tobacco — 1.4%

      

Altria Group, Inc.

      5,685      $ 360,542  

Philip Morris International, Inc.

      48,980        5,437,270  
     

 

 

  
      $ 5,797,812  
     

 

 

  

Trading Companies & Distributors — 0.1%

      

Fastenal Co.

      10,080      $ 459,446  
     

 

 

  
      $ 459,446  
     

 

 

  

Total Common Stocks — 99.4%
(identified cost $138,499,095)

       $ 405,204,186  
     

 

 

  

Total Call Options Written — (1.1)%
(premiums received $2,434,489)

       $ (4,292,600 ) 
     

 

 

  

Other Assets, Less Liabilities — 1.7%

       $ 6,942,844  
     

 

 

  

Net Assets — 100.0%

       $ 407,854,430  
     

 

 

  

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

 

(1) Non-income producing security.

 

6

 

 

                                                                                                                            
Call Options Written — (1.1)%  
Exchange-Traded Options — (1.1)%  
Description   

Number of

Contracts

     

Notional

Amount

     

Exercise

Price

     

Expiration

Date

      Value  

S&P 500 Index

      130      $ 32,751,680      $ 2,480        10/2/17      $ (508,950 ) 

S&P 500 Index

      130        32,751,680        2,480        10/4/17        (512,850 ) 

S&P 500 Index

      130        32,751,680        2,485        10/6/17        (455,000 ) 

S&P 500 Index

      130        32,751,680        2,495        10/9/17        (345,150 ) 

S&P 500 Index

      130        32,751,680        2,505        10/11/17        (256,100 ) 

S&P 500 Index

      130        32,751,680        2,490        10/13/17        (438,750 ) 

S&P 500 Index

      130        32,751,680        2,510        10/16/17        (239,200 ) 

S&P 500 Index

      130        32,751,680        2,510        10/18/17        (256,750 ) 

S&P 500 Index

      130        32,751,680        2,505        10/20/17        (323,050 ) 

S&P 500 Index

      130        32,751,680        2,505        10/23/17        (334,100 ) 

S&P 500 Index

      130        32,751,680        2,510        10/25/17        (302,250 ) 

S&P 500 Index

      130        32,751,680        2,510        10/27/17        (320,450 ) 
              

 

 

  

Total

 

    $ (4,292,600 ) 
              

 

 

  

All of the assets of the Fund are subject to segregation to satisfy the requirements of the escrow agent. At September 30, 2017, the Fund had sufficient cash and/or securities to cover commitments under open derivative contracts.

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

At September 30, 2017, the aggregate fair value of open derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) in a liability position and whose primary underlying risk exposure is equity price risk was $4,292,600.

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

 

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

 

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

 

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

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

 

7

 

 

At September 30, 2017, the hierarchy of inputs used in valuing the Fund’s investments and open derivative instruments, which are carried at value, were as follows:

 

Asset Description    Level 1      Level 2      Level 3      Total  

Common Stocks

    $ 405,204,186 *     $ —      $ —      $ 405,204,186  

Total Investments

    $     405,204,186      $     —      $     —      $     405,204,186  
Liability Description                          

Call Options Written

    $ (4,292,600 )     $ —      $ —      $ (4,292,600 ) 

Total

    $ (4,292,600 )     $ —      $ —      $ (4,292,600 ) 

 

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

The Fund held no investments or other financial instruments as of December 31, 2016 whose fair value was determined using Level 3 inputs. At September 30, 2017, there were no investments transferred between Level 1 and Level 2 during the fiscal year to date then ended.

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

 

8

 

 

Item 2. Controls and Procedures

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

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

Item 3. Exhibits

A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act is attached hereto.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Eaton Vance Tax-Managed Buy-Write Income Fund

 

By:   /s/ Edward J. Perkin
  Edward J. Perkin
  President
Date:   November 27, 2017

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By:   /s/ Edward J. Perkin
  Edward J. Perkin
  President
Date:   November 27, 2017

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   November 27, 2017