Company: MYI
Filing Date: 2025-09-05
Form Type: 424B3
Source: 0001193125-25-196285
Chunk: 191

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-09-05
Form: 424B3
Chunk 191
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 Swaps and SIFMA Swaps to seek to enhance return or gain or to increase MIY’s yield, for example, during periods of steep interest rate yield curves (i.e., wide differences between short-term and long-term interest rates).

MIY may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, MIY exchanges with another party their
respective commitments to pay or receive interest (e.g., an exchange of fixed rate payments for floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is
a tax-exempt index, SIFMA Swaps may reduce cross-market risks incurred by MIY and increase MIY’s ability to hedge effectively. SIFMA Swaps are typically quoted for the entire yield curve,
beginning with a seven day floating rate index out to 30 years. The duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate MIY Municipal Bond with the same attributes as the swap (e.g., coupon, maturity, call feature).

MIY may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap permits MIY to lock in a specified
municipal interest rate for a portion of its portfolio to preserve a return on a particular

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investment or a portion of its portfolio as a duration management technique or to protect against any increase in the price of securities to be purchased at a later date. By using an MMD Swap,
MIY can create a synthetic long or short position, allowing MIY to select the most attractive part of the yield curve. An MMD Swap is a contract between MIY and an MMD Swap provider pursuant to which the parties agree to make payments to each other
on a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or below a specified level on the expiration date of the contract. For example, if MIY buys an MMD Swap and the Municipal Market Data AAA
General Obligation Scale is below the specified level on the expiration date, the counterparty to the contract will make a payment to MIY equal to the specified level minus the actual level, multiplied by the notional amount of the contract. If the
Municipal Market Data AAA General Obligation Scale is above the specified level on the expiration date, MIY will make a payment to the counterparty equal to the actual level minus the specified level, multiplied by the notional