Blackrock Income Trust

BlackRock Income Trust, Inc. is a closed-end investment fund. Its investment objective is to provide total return through a combination of current income and capital appreciation. The company was founded on July 31, 1988 and is headquartered in Wilmington, DE.

BKT has delivered a 9% total return, outperforming the S&P 500, but the current pricing is no longer appealing, prompting a downgrade to 'Hold'. Significant rate narrowing has benefited BKT due to its high sensitivity to rates, but the fund's effective duration has now decreased to 7.3 years. BKT remains a leveraged proxy for mortgage REITs with high correlation to names like NLY and AGNC, but lacks active duration management.

BKT: Not An Attractive Entry Point After The Decrease In Rates (Rating Downgrade)

I evaluate the BlackRock Income Trust as an investment option and explain why I am no longer bearish on the fund. I previously had a sell rating on the fund due to limited opportunities, and but now I believe hold is the appropriate rating going forward, despite some macro-concerns I have. The fund had benefited from strong demand from the Fed and large US banks, both of whom have been scaling back their purchases of agency MBS.

BKT: There Is Both Good And Bad (Rating Upgrade)

BlackRock Income Trust is a closed-end fund that purchases agency MBS bonds and leverages them to generate high dividends and a rates-based return profile. The fund's 9% distribution yield is not supported by underlying cash flows, but it should make up for it through capital gains as rates move lower. BKT has a total return profile closely correlated to mortgage REITs like Annaly Capital and AGNC Investment Corp, making it an attractive option in the current macro environment.

BKT: Understand What You Are Buying, MBS Will Likely Deliver

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The BlackRock Income Trust offers a high yield of 8.80%, making it an attractive option for income-seeking investors. The fund invests in AA-rated mortgage-backed securities, providing a reasonable yield for investors looking for guaranteed government-backed securities. While the fund has seen recent gains, there is a risk of share price declines due to the powerful run-up in bonds, and investors may want to take some gains and reduce their risks.

BKT: Vulnerable To A Correction And Distribution Cut (Rating Downgrade)

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Investment-grade corporate-focused closed-end funds offer attractive fixed-income options with higher yields in the current higher-rate environment. Leverage and discounts/premiums in CEFs add volatility to consider when investing in these funds, which would otherwise be for more conservative investors. Besides the higher yields, when rates decline investment-grade funds should see a significant rebound, adding a catalyst for potential upside and 'locking in' higher yields now.

Closed-End Funds: Investment-Grade Corporate Fixed-Income Exposure To Consider

BKT is a leveraged MBS CEF. The fund's distributions are mostly return of capital, with low net investment income and coverage ratios. BKT has few benefits or positives.

BKT: Sell Before The Distribution Is Cut

BlackRock Income Trust offers investors access to high-quality agency-backed mortgages, providing impressive returns with fewer fluctuations and risks than mortgage REITs. BKT has a long track record and has outperformed passive MBS indices, offering higher Sortino and Sharpe ratios. The fund's active management strategy allows it to hedge against rate changes and capitalize on new mortgage issuances, providing potential for consistent returns, utilizing institutional tools like swaptions.

BKT: Harnessing The Power Of Agency-Backed Mortgages For Reliable Returns

The article evaluates BlackRock Income Trust (BKT) as an investment option at its current market price. BKT has not performed well since the last review in 2022, leading to a less-than-bullish rating. The fund's extensive use of leverage and lack of diversification pose a heightened risk environment, making it advisable to avoid.

BKT: Risks Remain Elevated (Rating Downgrade)

AGNC Investment

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AGNC Investment Corp. Deposit Shs Repr 1/1000th Cum Conv Red Pfd Registered Shs Series C

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Annaly Capital

Agency MBS is an attractive asset class for income investors due to its cheap valuation, high quality, and diversification benefits. The option-adjusted spread for Agency MBS is elevated compared to corporate credit spreads, making it an appealing investment. There are various ways to invest in Agency MBS, including through mortgage REITs, leveraged CEFs, unleveraged ETFs, and mREIT preferreds.

Why The Agency MBS Sector Is Worth A Look Now

The average American is suffering from high inflation, causing strain on household budgets and the need for additional sources of income. Investors can earn income by purchasing shares of closed-end funds specializing in income generation, such as the BlackRock Income Trust. The BlackRock Income Trust invests in high-quality securities, primarily agency-backed residential mortgage-backed securities, and offers an impressive 8.95% yield.

BKT: A Conservative Bond Fund For Income

BlackRock Income Trust is a fixed income closed end fund. BKT focuses on buying AAA Agency MBS bonds and leverages them up to enhance profits.

BKT: It Is Time To Buy Agency MBS Bonds

Investors are desperate for income today, as it is needed simply to maintain our lifestyles in the face of the highest inflation in forty years. BlackRock Income Trust invests in a portfolio consisting mostly of mortgage securities issued by major government-sponsored entities.

BKT: Interest Rate And Duration Risk Mar This Otherwise Safe Bond Fund

BlackRock Income Trust invests in a portfolio of government and agency securities to provide an income to its shareholders. BKT should be essentially free of default risk, which will undoubtedly appeal to anyone that is concerned with the preservation of capital.

BKT: A Bond Fund With An 8% Yield And Attractive Valuation

NEW YORK--(BUSINESS WIRE)--BlackRock Advisors, LLC announced today that the Board of Directors of BlackRock Income Trust, Inc. (NYSE:BKT) (the “Fund”) approved a 1-for-3 reverse stock split of the Fund's common stock. The Fund anticipates completing a 1-for-3 reverse stock split prior to the open of trading on the New York Stock Exchange (the “NYSE”) on October 18, 2022 for common stockholders of record as of the close of business on October 17, 2022. Trading in shares of the Fund's common stoc

BlackRock Announces Board Approval of a Reverse Stock Split for BlackRock Income Trust, Inc.

BKT is a fixed income CEF that focuses on AAA Agency MBS bonds. The CEF displays a performance similar to the better-known mREITs NLY and AGNC.

BKT: MBS Bonds Will Continue To Be Under Pressure

BKT has had a rough 2022. While there is value in positions here, the same was true a few months ago, and that has not stopped the sharp losses from occurring. The fund does trade at a nice discount to NAV, and Fed tapering is expected to be less aggressive than previously announced. Those are the positives.

BKT: Worst Probably Over, But Don't Get Overconfident

BKT is a mortgage backed securities CEF. The vehicle has been negatively impacted by the rise in treasury and mortgage rates.

BlackRock Income Trust: We Are Not There Yet

BKT has been hit hard over the past few months, but I believe this has opened up a potential buying opportunity.

BKT: What A Difference Two Months Can Make

BKT has seen some short-term pressure, and its return over the past four months has vindicated a more cautious view. Looking ahead, I am reluctant to advocate getting too bullish here. The fund's premium, duration, and weak UNII metrics are all concerns.

BKT: Risk-Reward Proposition Hasn't Changed Much

The fund has lost more than 4% since we wrote our bearish article. The Fed has finally announced their tapering decision but will be patient on rate hikes.

BKT: Moving From Bearish To Neutral After The Fed

BKT: Leveraged Agency MBS CEF, Unsustainable Distribution

BKT is a robust MBS CEF with a strong historical performance. The fund has never traded at a premium in the past decade except in 2021.

News for Blackrock Income Trust ETF (BKT)