Company: MYI
Filing Date: 2025-09-05
Form Type: 424B3
Source: 0001193125-25-196285
Chunk: 218

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-09-05
Form: 424B3
Chunk 218
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 any increase in the cost of
such security resulting from a decrease in interest rates or otherwise, that may occur before such purchase can be effected. Subject to the degree of correlation between such securities and the futures contracts, subsequent increases in the cost of
such securities should be reflected in the value of the futures held by MVF. As such purchases are made, an equivalent amount of futures contracts will be closed out. Due to changing market conditions and interest rate forecasts, however, a futures
position may be terminated without a corresponding purchase of portfolio securities.

Call Options on Futures Contracts. MVF may also purchase and sell exchange traded call and put options on financial futures contracts. The purchase of a call option on a futures contract is analogous to the purchase of a call option on an individual security. Depending
on the pricing of the option compared to either the futures contract upon which it is based or the price of the underlying securities, it may or may not be less risky than ownership of the futures contract or underlying securities. Like the purchase
of a futures contract, MVF may purchase a call option on a futures contract to hedge against a market advance when MVF is not fully invested.

The writing of a call option on a futures contract constitutes a partial hedge against declining prices of the securities
which are deliverable upon exercise of the futures contract. If the futures price at expiration is below the exercise price, MVF will retain the full amount of the option premium, which provides a partial hedge against any decline that may have
occurred in MVF’s portfolio holdings.

Put Options on Futures Contracts. The purchase of a put option on a
futures contract is analogous to the purchase of a protective put option on portfolio securities. MVF may purchase a put option on a futures contract to hedge MVF’s portfolio against the risk of rising interest rates.

The writing of a put option on a futures contract constitutes a partial hedge against increasing prices of the securities
which are deliverable upon exercise of the futures contract. If the futures price at expiration is higher than the exercise price, MVF will retain the full amount of the option premium, which provides a partial hedge against any increase in the
price of securities which MVF intends to purchase.

The writer of an option on a futures contract is required to deposit
initial and variation margin pursuant to requirements similar to those applicable to futures contracts. Premiums received from the writing of an option will be included in initial margin. The writing of an option on a futures contract involves risks
similar to those relating to futures