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BlackRock Science And Technology Trust: High Yield Tech Monthly Payer, 12% Dividend Growth


  • BST yields 5.5%, pays monthly, and issues a 1099 at tax time.
  • It has a four-year dividend growth rate of 11.82%.
  • It's selling at a -.50% discount to NAV vs. usually selling at a premium over the past two years.
  • Looking for a portfolio of ideas like this one? Members of Hidden Dividend Stocks Plus get exclusive access to our model portfolio. Get started today »

Looking for attractive yields in the Tech sector? As we've often noted in our articles, high or even moderate dividend yields are hard to come by in the Tech sector. That's a shame, because it has been one of the best-performing sectors in recent years.

2020 has continued this trend in spite of the market crash due to COVID-19. Tech is once again the leading sector, having risen 7.4% year to date. That's a swell, but look at that 1.25% dividend yield? Can you live on 1.25% as an income investor?

The BlackRock Science and Technology Trust (NYSE:BST) is one way to solve the income problem and benefit from Tech. It currently yields 5.5%, pays monthly, and uses a Covered Call strategy to enhance its yield:

Mr. Market has taken a shine to BST; it has outperformed the broad SPDR Technology ETF (XLK) and the S&P over the past month, quarter, and year to date:

BST is a closed ended equity mutual fund launched by BlackRock. The fund is managed by BlackRock Advisors, LLC. It invests directly and indirectly through derivatives such as options in public equity markets of countries across the globe. The fund seeks to invest in stocks of companies operating across the science and technology sector. It invests in dividend-paying and growth stocks of companies operating across all market capitalizations. The BlackRock Science and Technology Trust was formed on 28 October, 2014, and is domiciled in the US.


BST has 101 holdings, with very familiar Tech mega-caps in its top 10 group, such as Microsoft (MSFT), Amazon (AMZN), Apple (AAPL), among others. The top 10 holdings comprise 31% of its portfolio:


Software & Services is BST's top sub-industry, comprising ~47%, followed by Semiconductors at 16%, Media/Entertainment 13.5%, and Retailing at 10.65%:

(BST site)

68% of BST's

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This article was written by

Double Dividend Stocks profile picture

Robert Hauver, MBA, was VP of Finance for an industry-leading corporation for 18 years, and publishes SA articles under the name DoubleDividendStocks. TipRanks rates DoubleDividendStocks in the Top 25 of all financial bloggers, and Seeking Alpha rates us in the Top 5 of several categories, including Dividend Ideas, Basic Materials, and Utilities. 

"Hidden Dividend Stocks Plus", a Seeking Alpha Marketplace service, which focuses on undercovered and undervalued income vehicles. HDS+ scours the world's markets to find solid income opportunities with dividend yields ranging from 5% to 10%-plus, backed by strong earnings.

Analyst’s Disclosure: I am/we are long BST. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (55)

Kskumar29in profile picture
How do you compare it against their other fund, BSTZ? I find BSTZ more attractive due to its discount and focus on mid cap but curious to hear your thoughts.
BSTZ has some dubiously trendy and probably overvalued stocks, like SHOP and TSLA. I am not touching that.
JJMA1 profile picture
This is an excellent instrument...to put on the watch list. I will definitely buy at some point on a dip. Maybe the reason I'm not wealthy yet is because I refuse to buy at record highs, or maybe it's my fear of heights. So far dip buying has kept my psychology at bay, so I will be patient with things like this. A science and technology fund with a yield? That's like a unicorn these days.
Double Dividend Stocks profile picture
Sounds like a good plan.
Thanks for reading and commenting.
nicholas davout profile picture
A direct comparison of BST with STK, HTGC and QQQX would have been a worthwhile effort.
Double Dividend Stocks profile picture
@nicholas davout
YTD: BST +10%, HTGC (BDC) -17%, QQQX flat.
HTGC much higher yield doesn't seem to have attracted enough buyers to support its price. BDC's have gotten hit hard in 2020.
Thanks for reading.
One of your best yet !! for the questions on when you write an article , if it is a solid investment the market will go down so buy then !! thanks again
Double Dividend Stocks profile picture
LOL! Murphy was an optimist.
Thanks for reading and commenting.
Cliff Wachtel profile picture
How does BST compare w/ QQQX?
Also, doesn't this work with leverage ie boosts returns via combo of selling covered calls + leverage? if so, that works fine in flat or up trending markets but is loser in down-trend, right?
Double Dividend Stocks profile picture
YTD: BST +10%, QQQX flat.
Thanks for reading.
Green Elmo a.k.a. User 48289781 profile picture
" doesn't this work with leverage ie boosts returns via combo of selling covered calls + leverage? if so, that works fine in flat or up trending markets but is loser in down-trend, right? "

QQQ has been trending up during Q2 2020.
VGT has outperformed since the inception of BST.
Balance sheet guru profile picture
VGT is great. I own it and will keep it. Should be 5X in 10 years.
BST outperforms VGT both 3 and 5 year. Also ytd
@Balance sheet guru

Morningstar comparison indicates that VGT bested BST in 1, 3, and 5 year performance, and BST barely bested VGT in YTD performance.
since price is at record, what can one expect to earn a year fro now?
Babbage profile picture
Question: Whence this high dividend yield for BST? The high weighting of these tech stocks does not indicate that this fund should have such a high dividend yield. Is this truly dividends? Or is it something else, some sort of dividend-like construct made to be payable monthly? I am not well versed in fund yields but am very curious where this high yield comes from.
Double Dividend Stocks profile picture
Good question. BST increases the yield via employing a strategy of writing (selling) covered call options on a portion, (typically ~30%+) of the common stocks in its portfolio.
Thanks for reading and commenting.
Babbage profile picture
That makes sense, though pretty confusing to call it a "dividend" yield. Sure not treated the same way for taxes, like these are probably listed as non-qualified dividends?
I know it's asking a lot (authors can only get out so many), but it would sure have been great to have this article come out when we were are at the lowest in late March/early-April. Much like the author did nailing AMH (though I'd honestly rather have seen this one at BST back then rather than the AMH article, haha). Anyhow, in my old-jaundiced eyes, BST looked great at $23-28, not so much right now at $34-$36. Not in this environment. There are more attractive CEFs at the moment imho. Good luck to us all in the coming ultra-deflationary environment that will unfold like a slow-moving freight train to the point molasses looks like water in comparison to that deflationary-unfolding.
Double Dividend Stocks profile picture
@D. Rider
Yes, time is a serious constraint, but it's better to write about an income vehicle at various times, and expose readers to it, than not at all. There's always the idea of adding it to a watchlist, for the next pullback.
Thanks for reading.
At a 52 week high?
gman1253 profile picture
Thanks - long time holder of BST.

Should compare to AIO & BSTZ - these last 2 are newer of course. Different holding though within tech.
Double Dividend Stocks profile picture
Thanks for reading and commenting.
mdwork profile picture
Thank you for the information. Very informative. I had purchased this fund a few years ago. It has been my best CEF. I have started buying both BSTZ and BMEZ the last few weeks. They are new CEF hoping for similar results.
There may be some china risk huh
@wanderlustsrt - yes, I believe it was SA contributor Douglas Albo that pointed out BST had China tech exposure which may be a detriment depending on how US/China relations go. STK is a similar tech ETF I follow that is more US centric.
Nick Ackerman profile picture
Definitely glad I was able to pick up some BST in March and April. It is just a solid long-term fund offered by a great fund sponsor. If we revisit lows, I'll buy more. At the moment I would be looking more at BSTZ for its discount. It is also a tech fund but offers exposure to smaller companies and some private investments, so it really isn't an overlap in holdings either.
Double Dividend Stocks profile picture
@Nick Ackerman
Many bargains in late March-early April.
Thanks for reading and commenting.
atom profile picture
Another related possibility, with an even higher discount, is AIO, which is also a new fund, now about 6 months old. Somewhat different portfolio and not as well-known as the BlackRock efforts, though from a good source. One overrated fund in the same area is STK, though its premium has dropped down recently. I may buy back into STK.
Anyone know the % of ROC for the past fiscal year?
BST was 0% ROC last year whereas BSTZ was 100% ROC but keep in mind that BSTZ is new.


However, BST has seen some ROC during the last few months -


Not to concerned with that given the context of when it was occurring.
Double Dividend Stocks profile picture
During 2019, its distributions were 100% capital gains, with 0% return of capital.
Thanks for reading.
SleepyInSeattle profile picture
Excellent and comprehensive article. Thank you.
Localinvestor60 profile picture
I referred BST to a friend and his family members back in September. Yesterday's new 52-week high goes well with today's article. It's one of my holdings in my retirement portfolio. BST is an excellent investment as a tech holding for someone who doesn't know which stock to select amongst the many technology companies to choose from.
Double Dividend Stocks profile picture
Glad it has worked out for you.
Thanks for reading and commenting.
long-time holder, absolutely love BST. Thank you for the great article highlighting this CEF! :)
Double Dividend Stocks profile picture
Thanks for reading and commenting.
Excellent article. How does BST compare to HRZN? Do you have a preference?
Double Dividend Stocks profile picture
@Saint Mark
HRZN is a Business Development Corp.- BDC, whereas BST is a Closed End Fund - CEF. BDC's tend to invest in non-publicly traded companies.
Thanks for reading.
Vandooman profile picture
Interesting. A lot of doubling up involved but not a problem. Not sure the gains will keep up the recent pace.
Double Dividend Stocks profile picture
You're probably right about the recent pace - BST & the market have been on fire over the past month.
Thanks for reading and commenting.
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