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, 2014

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

Eaton Vance

Tax-Managed Buy-Write Income Fund

September 30, 2014

PORTFOLIO OF INVESTMENTS (Unaudited)

Common Stocks — 99.7%

 

                                                 
Security    Shares      Value  

Aerospace & Defense — 3.6%

      

Boeing Co. (The)

      26,422       $ 3,365,634   

Honeywell International, Inc.

      43,114         4,014,776   

Northrop Grumman Corp.

      21,600         2,846,016   

Textron, Inc.

      11,648         419,211   

United Technologies Corp.

      36,353         3,838,877   
     

 

 

  
      $ 14,484,514   
     

 

 

  

Air Freight & Logistics — 0.4%

      

C.H. Robinson Worldwide, Inc.

      7,252       $ 480,952   

United Parcel Service, Inc., Class B

      10,003         983,195   
     

 

 

  
      $ 1,464,147   
     

 

 

  

Airlines — 0.3%

      

Southwest Airlines Co.

      36,616       $ 1,236,522   
     

 

 

  
      $ 1,236,522   
     

 

 

  

Auto Components — 0.8%

      

Dana Holding Corp.

      31,658       $ 606,884   

Goodyear Tire & Rubber Co. (The)

      10,898         246,131   

Johnson Controls, Inc.

      36,367         1,600,148   

Lear Corp.

      7,250         626,473   
     

 

 

  
      $ 3,079,636   
     

 

 

  

Automobiles — 0.3%

      

Ford Motor Co.

      76,877       $ 1,137,011   
     

 

 

  
      $ 1,137,011   
     

 

 

  

Banks — 6.9%

      

Bank of America Corp.

      131,359       $ 2,239,671   

BankUnited, Inc.

      10,483         319,627   

Citigroup, Inc.

      108,402         5,617,392   

Fifth Third Bancorp

      57,446         1,150,069   

JPMorgan Chase & Co.

      109,741         6,610,798   

KeyCorp

      85,122         1,134,676   

M&T Bank Corp.

      5,096         628,286   

PNC Financial Services Group, Inc. (The)

      22,704         1,943,008   

SunTrust Banks, Inc.

      5,538         210,610   

Wells Fargo & Co.

      156,052         8,094,417   
     

 

 

  
      $ 27,948,554   
     

 

 

  

Beverages — 2.6%

      

Coca-Cola Co. (The)

      138,646       $ 5,914,638   

PepsiCo, Inc.

      47,142         4,388,449   
     

 

 

  
      $ 10,303,087   
     

 

 

  

Biotechnology — 3.1%

      

Amgen, Inc.

      18,988       $ 2,667,054   

Biogen Idec, Inc.(1)

      1,780         588,842   

Celgene Corp.(1)

      45,891         4,349,549   

Gilead Sciences, Inc.(1)

      44,082         4,692,529   

Vertex Pharmaceuticals, Inc.(1)

      1,850         207,774   
     

 

 

  
      $ 12,505,748   
     

 

 

  

 

1

 

 

                                                 
Security    Shares      Value  

Capital Markets — 1.2%

      

Invesco, Ltd.

      38,480       $ 1,519,190   

Lazard, Ltd., Class A

      21,525         1,091,317   

Legg Mason, Inc.

      7,629         390,300   

State Street Corp.

      27,413         2,017,871   
     

 

 

  
      $ 5,018,678   
     

 

 

  

Chemicals — 2.2%

      

CF Industries Holdings, Inc.

      3,459       $ 965,822   

Dow Chemical Co. (The)

      45,132         2,366,722   

E.I. du Pont de Nemours & Co.

      46,387         3,328,731   

Eastman Chemical Co.

      3,608         291,851   

Sherwin-Williams Co. (The)

      9,183         2,010,985   
     

 

 

  
      $ 8,964,111   
     

 

 

  

Commercial Services & Supplies — 0.3%

      

Waste Management, Inc.

      25,552       $ 1,214,487   
     

 

 

  
      $ 1,214,487   
     

 

 

  

Communications Equipment — 2.2%

      

Brocade Communications Systems, Inc.

      42,403       $ 460,921   

Cisco Systems, Inc.

      134,376         3,382,244   

QUALCOMM, Inc.

      69,800         5,218,946   
     

 

 

  
      $ 9,062,111   
     

 

 

  

Construction & Engineering — 0.4%

      

Fluor Corp.

      25,575       $ 1,708,154   
     

 

 

  
      $ 1,708,154   
     

 

 

  

Consumer Finance — 1.3%

      

American Express Co.

      27,933       $ 2,445,255   

Discover Financial Services

      40,754         2,624,150   
     

 

 

  
      $ 5,069,405   
     

 

 

  

Containers & Packaging — 0.4%

      

Avery Dennison Corp.

      15,307       $ 683,458   

MeadWestvaco Corp.

      21,446         877,999   
     

 

 

  
      $ 1,561,457   
     

 

 

  

Distributors — 0.6%

      

Genuine Parts Co.

      27,494       $ 2,411,499   
     

 

 

  
      $ 2,411,499   
     

 

 

  

Diversified Financial Services — 1.6%

      

Berkshire Hathaway, Inc., Class B(1)

      26,717       $ 3,690,686   

McGraw Hill Financial, Inc.

      35,026         2,957,946   
     

 

 

  
      $ 6,648,632   
     

 

 

  

Diversified Telecommunication Services — 2.1%

      

AT&T, Inc.

      143,075       $ 5,041,963   

Frontier Communications Corp.

      67,026         436,339   

Verizon Communications, Inc.

      52,772         2,638,072   

Windstream Holdings, Inc.

      28,197         303,964   
     

 

 

  
      $ 8,420,338   
     

 

 

  

Electric Utilities — 1.0%

      

Duke Energy Corp.

      26,841       $ 2,006,902   

Edison International

      21,133         1,181,757   

Pepco Holdings, Inc.

      3,646         97,567   

Pinnacle West Capital Corp.

      7,168         391,659   

Xcel Energy, Inc.

      12,009         365,074   
     

 

 

  
      $ 4,042,959   
     

 

 

  

 

2

 

 

                                                 
Security    Shares      Value  

Electrical Equipment — 0.8%

      

Emerson Electric Co.

      49,204       $ 3,079,186   
     

 

 

  
      $ 3,079,186   
     

 

 

  

Energy Equipment & Services — 2.2%

      

Halliburton Co.

      53,378       $ 3,443,415   

Schlumberger, Ltd.

      51,953         5,283,100   
     

 

 

  
      $ 8,726,515   
     

 

 

  

Food & Staples Retailing — 1.8%

      

CVS Health Corp.

      57,307       $ 4,561,064   

Wal-Mart Stores, Inc.

      33,228         2,540,945   
     

 

 

  
      $ 7,102,009   
     

 

 

  

Food Products — 1.7%

      

Kellogg Co.

      16,937       $ 1,043,319   

Keurig Green Mountain, Inc.

      15,366         1,999,578   

Kraft Foods Group, Inc.

      11,107         626,435   

Mondelez International, Inc., Class A

      54,344         1,862,097   

Tyson Foods, Inc., Class A

      28,696         1,129,761   
     

 

 

  
      $ 6,661,190   
     

 

 

  

Health Care Equipment & Supplies — 3.0%

      

Abbott Laboratories

      73,588       $ 3,060,525   

Baxter International, Inc.

      41,401         2,971,350   

Covidien PLC

      11,380         984,484   

Medtronic, Inc.

      41,406         2,565,101   

Stryker Corp.

      26,801         2,164,181   

Zimmer Holdings, Inc.

      5,294         532,312   
     

 

 

  
      $ 12,277,953   
     

 

 

  

Health Care Providers & Services — 1.4%

      

DaVita HealthCare Partners, Inc.(1)

      4,408       $ 322,401   

HCA Holdings, Inc.(1)

      8,034         566,558   

UnitedHealth Group, Inc.

      49,739         4,289,989   

VCA, Inc.(1)

      11,050         434,596   
     

 

 

  
      $ 5,613,544   
     

 

 

  

Hotels, Restaurants & Leisure — 1.2%

      

Marriott International, Inc., Class A

      14,651       $ 1,024,105   

Marriott Vacations Worldwide Corp.(1)

      2,064         130,878   

McDonald’s Corp.

      29,735         2,819,176   

Wyndham Worldwide Corp.

      11,235         912,956   
     

 

 

  
      $ 4,887,115   
     

 

 

  

Household Durables — 0.9%

      

Leggett & Platt, Inc.

      11,383       $ 397,494   

Lennar Corp., Class A

      18,642         723,869   

Newell Rubbermaid, Inc.

      76,798         2,642,619   
     

 

 

  
      $ 3,763,982   
     

 

 

  

Household Products — 1.6%

      

Clorox Co. (The)

      6,843       $ 657,202   

Kimberly-Clark Corp.

      19,850         2,135,265   

Procter & Gamble Co. (The)

      41,964         3,514,065   
     

 

 

  
      $ 6,306,532   
     

 

 

  

Industrial Conglomerates — 1.7%

      

3M Co.

      21,663       $ 3,069,214   

General Electric Co.

      154,157         3,949,502   
     

 

 

  
      $ 7,018,716   
     

 

 

  

 

3

 

 

                                                 
Security    Shares      Value  

Insurance — 4.4%

      

ACE, Ltd.

      14,012       $ 1,469,439   

Allstate Corp. (The)

      50,422         3,094,398   

AmTrust Financial Services, Inc.

      3,045         121,252   

Cincinnati Financial Corp.

      18,908         889,621   

Lincoln National Corp.

      47,210         2,529,512   

Marsh & McLennan Cos., Inc.

      50,188         2,626,840   

MetLife, Inc.

      14,938         802,469   

Principal Financial Group, Inc.

      29,001         1,521,683   

Prudential Financial, Inc.

      21,629         1,902,054   

Travelers Companies, Inc. (The)

      31,286         2,939,007   
     

 

 

  
      $ 17,896,275   
     

 

 

  

Internet & Catalog Retail — 1.1%

      

Amazon.com, Inc.(1)

      2,750       $ 886,710   

Netflix, Inc.(1)

      223         100,613   

Priceline Group, Inc. (The)(1)

      1,797         2,081,968   

Shutterfly, Inc.(1)

      28,875         1,407,368   
     

 

 

  
      $ 4,476,659   
     

 

 

  

Internet Software & Services — 3.3%

      

Facebook, Inc., Class A(1)

      12,721       $ 1,005,468   

Google, Inc., Class A(1)

      8,610         5,066,210   

Google, Inc., Class C(1)

      8,610         4,971,069   

VeriSign, Inc.(1)

      41,883         2,308,591   
     

 

 

  
     

 

 

  
      $ 13,351,338   
     

 

 

  

IT Services — 3.1%

      

Fidelity National Information Services, Inc.

      26,132       $ 1,471,232   

International Business Machines Corp.

      33,173         6,297,230   

MasterCard, Inc., Class A

      53,680         3,968,026   

Visa, Inc., Class A

      2,469         526,810   

Xerox Corp.

      7,778         102,903   
     

 

 

  
      $ 12,366,201   
     

 

 

  

Leisure Products — 0.3%

      

Mattel, Inc.

      38,366       $ 1,175,918   
     

 

 

  
      $ 1,175,918   
     

 

 

  

Life Sciences Tools & Services — 0.8%

      

Thermo Fisher Scientific, Inc.

      27,884       $ 3,393,483   
     

 

 

  
      $ 3,393,483   
     

 

 

  

Machinery — 1.2%

      

Caterpillar, Inc.

      31,778       $ 3,146,975   

Snap-On, Inc.

      6,380         772,491   

Stanley Black & Decker, Inc.

      8,690         771,585   
     

 

 

  
      $ 4,691,051   
     

 

 

  

Media — 4.6%

      

CBS Corp., Class B

      41,650       $ 2,228,275   

Comcast Corp., Class A

      102,935         5,535,844   

Omnicom Group, Inc.

      35,123         2,418,570   

Time Warner, Inc.

      36,488         2,744,263   

Walt Disney Co. (The)

      64,815         5,770,479   
     

 

 

  
      $ 18,697,431   
     

 

 

  

Metals & Mining — 0.6%

      

Freeport-McMoRan, Inc.

      17,655       $ 576,436   

Nucor Corp.

      31,251         1,696,304   
     

 

 

  
      $ 2,272,740   
     

 

 

  

 

4

 

 

                                                 
Security    Shares      Value  

Multi-Utilities — 1.9%

      

Centerpoint Energy, Inc.

      17,504       $ 428,323   

CMS Energy Corp.

      77,060         2,285,599   

Dominion Resources, Inc.

      1,997         137,973   

DTE Energy Co.

      10,342         786,819   

NiSource, Inc.

      49,999         2,048,959   

Public Service Enterprise Group, Inc.

      52,545         1,956,776   
     

 

 

  
      $ 7,644,449   
     

 

 

  

Multiline Retail — 0.9%

      

Macy’s, Inc.

      48,228       $ 2,805,905   

Nordstrom, Inc.

      12,248         837,396   
     

 

 

  
      $ 3,643,301   
     

 

 

  

Oil, Gas & Consumable Fuels — 8.0%

      

Chevron Corp.

      62,708       $ 7,482,319   

ConocoPhillips

      44,430         3,399,784   

EOG Resources, Inc.

      33,718         3,338,756   

Exxon Mobil Corp.

      78,264         7,360,729   

Kinder Morgan, Inc.

      12,255         469,857   

Occidental Petroleum Corp.

      22,277         2,141,933   

Phillips 66

      26,847         2,182,930   

Range Resources Corp.

      20,840         1,413,160   

Tesoro Corp.

      19,643         1,197,830   

Williams Cos., Inc.

      57,536         3,184,618   
     

 

 

  
      $ 32,171,916   
     

 

 

  

Personal Products — 0.1%

      

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

      3,326       $ 248,519   
     

 

 

  
      $ 248,519   
     

 

 

  

Pharmaceuticals — 5.5%

      

AbbVie, Inc.

      19,355       $ 1,117,945   

Bristol-Myers Squibb Co.

      80,700         4,130,226   

Johnson & Johnson

      51,433         5,482,244   

Merck & Co., Inc.

      109,607         6,497,503   

Pfizer, Inc.

      171,390         5,068,002   
     

 

 

  
      $ 22,295,920   
     

 

 

  

Professional Services — 0.2%

      

ManpowerGroup, Inc.

      1,193       $ 83,629   

Robert Half International, Inc.

      18,170         890,330   
     

 

 

  
      $ 973,959   
     

 

 

  

Real Estate Investment Trusts (REITs) — 1.7%

      

Apartment Investment & Management Co., Class A

      12,428       $ 395,459   

AvalonBay Communities, Inc.

      11,002         1,550,952   

Equity Residential

      14,774         909,783   

Host Hotels & Resorts, Inc.

      58,590         1,249,725   

Kimco Realty Corp.

      78,276         1,715,027   

ProLogis, Inc.

      22,296         840,559   
     

 

 

  
      $ 6,661,505   
     

 

 

  

Real Estate Management & Development — 0.1%

      

CBRE Group, Inc., Class A(1)

      8,158       $ 242,619   
     

 

 

  
      $ 242,619   
     

 

 

  

Road & Rail — 1.2%

      

J.B. Hunt Transport Services, Inc.

      3,521       $ 260,730   

Kansas City Southern

      11,539         1,398,527   

Norfolk Southern Corp.

      27,357         3,053,041   
     

 

 

  
      $ 4,712,298   
     

 

 

  

 

5

 

 

                                                 
Security    Shares      Value  

Semiconductors & Semiconductor Equipment — 1.6%

      

Advanced Micro Devices, Inc.(1)

      352,424       $ 1,201,766   

Analog Devices, Inc.

      16,160         799,758   

Applied Materials, Inc.

      15,313         330,914   

Cree, Inc.(1)

      21,482         879,688   

Cypress Semiconductor Corp.(1)

      60,131         593,794   

Intel Corp.

      56,723         1,975,095   

Micron Technology, Inc.(1)

      3,063         104,938   

Teradyne, Inc.

      32,470         629,593   
     

 

 

  
      $ 6,515,546   
     

 

 

  

Software — 3.7%

      

Concur Technologies, Inc.(1)

      12,197       $ 1,546,823   

Microsoft Corp.

      196,258         9,098,521   

Oracle Corp.

      103,117         3,947,319   

Symantec Corp.

      8,033         188,856   
     

 

 

  
      $ 14,781,519   
     

 

 

  

Specialty Retail — 1.9%

      

Abercrombie & Fitch Co., Class A

      4,343       $ 157,825   

Advance Auto Parts, Inc.

      3,365         438,459   

AutoNation, Inc.(1)

      5,400         271,674   

Home Depot, Inc. (The)

      58,841         5,398,073   

Tiffany & Co.

      14,641         1,410,075   
     

 

 

  
      $ 7,676,106   
     

 

 

  

Technology Hardware, Storage & Peripherals — 4.1%

      

Apple, Inc.

      163,136       $ 16,435,952   
     

 

 

  
      $ 16,435,952   
     

 

 

  

Textiles, Apparel & Luxury Goods — 0.3%

      

NIKE, Inc., Class B

      15,176       $ 1,353,699   
     

 

 

  
      $ 1,353,699   
     

 

 

  

Tobacco — 1.4%

      

Lorillard, Inc.

      5,365       $ 321,417   

Philip Morris International, Inc.

      63,379         5,285,809   
     

 

 

  
      $ 5,607,226   
     

 

 

  

Trading Companies & Distributors — 0.1%

      

Fastenal Co.

      10,080       $ 452,592   
     

 

 

  
      $ 452,592   
     

 

 

  

Total Common Stocks — 99.7%
(identified cost $179,925,766)

       $ 401,456,014   
     

 

 

  

Call Options Written — (0.2)%

      

 

                                                                                                   
Description    Number of
Contracts		      Strike
Price		      Expiration
Date		      Value  

S&P 500 Index

      530       $ 2,010         10/3/14       $ (17,225 ) 

S&P 500 Index

      480         2,015         10/10/14         (93,600 ) 

S&P 500 Index

      480         2,025         10/18/14         (114,000 ) 

S&P 500 Index

      435         2,000         10/24/14         (530,700 ) 
           

 

 

  

Total Call Options Written
(premiums received $2,430,802)

             $ (755,525 ) 
           

 

 

  

Other Assets, Less Liabilities — 0.5%

             $ 1,768,371   
           

 

 

  

Net Assets — 100.0%

             $ 402,468,860   
           

 

 

  

 

6

 

 

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

 

(1) Non-income producing security.

The cost and unrealized appreciation (depreciation) of investments of the Fund at September 30, 2014, as determined on a federal income tax basis, were as follows:

 

Aggregate cost

    $ 179,837,042   
  

 

 

  

Gross unrealized appreciation

    $ 221,623,716   

Gross unrealized depreciation

      (4,744 ) 
  

 

 

  

Net unrealized appreciation

    $     221,618,972   
  

 

 

  

Written options activity for the fiscal year to date ended September 30, 2014 was as follows:

 

     Number of
Contracts		     Premiums
Received		  
Outstanding, beginning of period      2,085      $ 3,225,262   
Options written      19,435        27,274,388   
Options terminated in closing purchase transactions      (13,710 )      (19,486,791 ) 
Options expired      (5,885 )      (8,582,057 ) 
  

 

 

    

 

 

  
Outstanding, end of period      1,925      $ 2,430,802   
  

 

 

    

 

 

  

All of the assets of the Fund are subject to segregation to satisfy the requirements of the escrow agent. At September 30, 2014, the Fund had sufficient cash and/or securities to cover commitments under these 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, 2014, 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 $755,525.

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

 

•  

Level 1 — quoted prices in active markets for identical investments

 

•  

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

 

•  

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

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

At September 30, 2014, 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

    $ 401,456,014 *    $ —       $ —       $ 401,456,014   

Total Investments

    $     401,456,014      $     —       $     —       $     401,456,014   
Liability Description                               

Call Options Written

    $ (755,525 )    $ —       $ —       $ (755,525 ) 

Total

    $ (755,525 )    $ —       $ —       $ (755,525 ) 

 

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

 

7

 

 

The Fund held no investments or other financial instruments as of December 31, 2013 whose fair value was determined using Level 3 inputs. At September 30, 2014, 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.

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/ Walter A. Row, III
  Walter A. Row, III
  President
Date:   November 24, 2014

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/ Walter A. Row, III
  Walter A. Row, III
  President
Date:   November 24, 2014

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   November 24, 2014