Company: MYI
Filing Date: 2025-09-08
Form Type: DEF 14A
Source: 0001193125-25-198172
Chunk: 190

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-09-08
Form: DEF 14A
Chunk 190
---
 investment companies that invest in MIY Municipal Bonds, to the extent such investments
are permitted by MIY’s investment restrictions and applicable law. Non-Municipal Tax-Exempt Securities are subject to the same risks associated with an investment
in MIY Municipal Bonds as well as many of the risks associated with investments in derivatives.

MIY ordinarily does not intend to realize
significant investment income not exempt from federal income tax. From time to time, MIY may realize taxable capital gains.

106

Federal tax legislation has limited the types and volume of bonds the interest on which
qualifies for a federal income tax-exemption. As a result, this legislation and legislation that may be enacted in the future may affect the availability of MIY Municipal Bonds for investment by MIY.

Description of MIY Municipal Bonds

See
“The Acquiring Fund’s Investments – Description of MYI Municipal Bonds” for additional information regarding the types of municipal bonds in which MIY invests.

Strategic Transactions and Other Management Techniques

MIY may purchase and sell futures contracts, enter into various interest rate transactions and swap contracts (including, but not limited to,
credit default swaps) and may purchase and sell exchange-listed and OTC put and call options on securities and swap contracts, financial indices and futures contracts and use other derivative instruments or management techniques (collectively,
“Strategic Transactions”). These Strategic Transactions may be used for duration management and other risk management purposes, subject to MIY’s investment restrictions. While MIY’s use of Strategic Transactions is intended
to reduce the volatility of the NAV of MIY’s common shares, the NAV of MIY’s common shares will fluctuate. No assurance can be given that MIY’s Strategic Transactions will be effective.

There is no particular strategy that requires use of one technique rather than another as the decision to use any particular strategy or
instrument is a function of market conditions and the composition of the portfolio. The ability of MIY to use Strategic Transactions successfully will depend on the Investment Advisor’s ability to predict pertinent market movements as well as
sufficient correlation among the instruments, which cannot be assured. Strategic Transactions subject MIY to the risk that, if the Investment Advisor incorrectly forecasts market values, interest rates or other applicable factors, MIY’s
performance could suffer. Certain of these Strategic Transactions, such as investments in inverse floating rate securities and credit default swaps, may provide investment leverage to MIY’s portfolio. MIY is not required to use derivatives or
other portfolio strategies to seek to hedge its portfolio and may