UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-10635

Name of Fund: BlackRock Strategic Bond Trust (BHD)

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: Donald C. Burke, Chief Executive Officer, BlackRock Strategic Bond Trust, 800 Scudders Mill Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton, NJ, 08543-9011

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 10/31/2007

Date of reporting period: 11/01/2006 – 10/31/2007

Item 1 – Report to Stockholders

EQUITIES FIXED INCOME REAL ESTATE LIQUIDITY ALTERNATIVES BLACKROCK SOLUTIONS

Closed-End Funds
ANNUAL REPORT | OCTOBER 31, 2007

BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)

BlackRock Core Bond Trust (BHK)

BlackRock High Yield Trust (BHY)

BlackRock Income Opportunity Trust (BNA)

BlackRock Income Trust Inc. (BKT)

BlackRock Limited Duration Income Trust (BLW)

BlackRock Preferred and Equity Advantage Trust (BTZ)

BlackRock Strategic Bond Trust (BHD)

NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE

Table of Contents	Page
A Letter to Shareholders	1
Annual Report:
Trust Summaries	2
Financial Statements:
Portfolio of Investments	10
Statements of Assets and Liabilities	47
Statements of Operations	49
Statements of Cash Flows	51
Statements of Changes in Net Assets	53
Financial Highlights	55
Notes to Financial Statements	63
Report of Independent Registered Public Accounting Firm	78
The Benefits and Risks of Leveraging	79
Dividend Reinvestment Plans	80
BlackRock Privacy Principles	80
Additional Information	81
Section 19 Notices	84
Directors/Trustees Information	85

A Letter to Shareholders

Dear Shareholder

The October reporting period was fairly tumultuous for financial markets, but culminated in positive performance for most major benchmarks:

Total returns as of October 31, 2007

	6-month	12-month
U.S. equities (S&P 500 Index)	+5.49 %	+14.56	%
Small cap U.S. equities (Russell 2000 Index)	+2.25 %	+9.27	%
International equities (MSCI Europe, Australasia, Far East Index)	+8.19 %	+24.91	%
Fixed income (Lehman Brothers U.S. Aggregate Bond Index)	+2.68 %	+5.38	%
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index)	+1.30 %	+2.91	%
High yield bonds
(Lehman Brothers U.S. Corporate High Yield 2% Issuer Cap Index)	-0.07 %	+6.89	%

          Past performance is no guarantee of future results. Index performance shown for illustrative purposes only. You cannot invest directly in an index.

Subprime mortgage woes dominated headlines for much of 2007, but intensified in the summer and fall, spawning a widespread liquidity and credit crisis with ramifications across global markets. The Federal Reserve Board (Fed) and other countries’ central banks stepped in to inject liquidity into the markets and bolster investor confidence. The Fed cut the federal funds rate by 0.50% in September and another 0.25% on the final day of the reporting period, bringing its target rate to 4.50%. In taking action, the central bankers, who had long deemed themselves inflation fighters, were seeking to stem the fallout from the credit crunch and forestall a wider economic unraveling. By period-end, the Fed had cited the risks between slower economic growth and faster inflation as equally balanced.

Amid the volatility throughout the past year, equity markets have displayed surprising resilience. Most recently, the credit turmoil dampened corporate merger-and-acquisition (M&A) activity, a key source of strength for equity markets. Still, market fundamentals have held firm, dividend payouts and share buybacks have continued to grow, and valuations remain attractive. These tailwinds generally have prevailed over the headwinds created by the slowing U.S. economy, troubled housing market and, recently, a more difficult corporate earnings backdrop. International markets fared even better than U.S. equities, benefiting from robust M&A activity and generally stronger economies.

In fixed income markets, mixed economic signals and the credit woes resulted in a flight to quality. At the height of the uncertainty, investors shunned bonds associated with the housing and credit markets in favor of higher-quality Treasury issues. The yield on 10-year Treasury issues, which touched 5.30% in June (its highest level in five years), fell to 4.48% by period-end, while prices correspondingly rose. The tax-exempt bond market has been challenged by a combination of record-setting supply year-to-date, economic uncertainty and concerns around the credit worthiness of bond insurers. This has brought municipal bond prices to relatively attractive levels and, as such, demand generally has remained firm.

As you navigate market volatility, we encourage you to review your investment goals with your financial professional and to make portfolio changes, as needed. For more market insight and commentary from BlackRock investment professionals, we invite you to visit www.blackrock.com/funds. As always, we thank you for entrusting BlackRock with your investment assets, and we look forward to continuing to serve you in the months and years ahead.

Sincerely,

Robert C. Doll, Jr.

Vice Chairman, BlackRock, Inc.

THIS PAGE NOT PART OF YOUR TRUSTS REPORT

1 ANNUAL REPORT OCTOBER 31, 2007

Trust Summary as of October 31, 2007
BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)

Investment Objective

The Trust’s investment objective is to manage a portfolio of fixed income securities that will return $15 per share (the initial public offering price per share) to investors on or about December 31, 2009 while providing high monthly income.

Trust Information

Symbol on American Stock Exchange:	BCT
Initial Offering Date:	June 17, 1993
Yield on Closing Market Price as of October 31, 2007 ($15.15):1	5.94%
Current Monthly Distribution per Share:2	$ 0.075
Current Annualized Distribution per Share:2	$ 0.900

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on November 1, 2007. The Monthly Distribution per Common Share was decreased to $0.049. The Yield on Closing Market Price, Current Monthly Distribution and Current Annualized Distribution do not reflect the new distribution rate. The new distribution rate is not constant and is subject to further change in the future.

The table below summarizes the changes in the Trust’s market price and net asset value per share:

	10/31/07		10/31/06		Change		High		Low
Market Price	$	15.15	$	15.08	0.46	%	$	15.65	$	14.82
Net Asset Value	$	13.38	$	13.79	(2.97	)%	$	13.81	$	13.36

The following unaudited chart shows the portfolio composition of the Trust’s long-term investments:

Portfolio Composition

Composition	10/31/07		10/31/06
Agency Multiple Class Mortgage Pass-Through Securities	31	%	28	%
Taxable Municipal Bonds	18		11
Non-Agency Multiple Class Mortgage Pass-Through Securities	16		—
Inverse Floating Rate Mortgage Securities	15		8
Corporate Bonds	9		14
Interest Only Mortgage-Backed Securities	8		7
Mortgage Pass-Through Securities	3		2
U.S. Government and Agency Securities	—		30

ANNUAL REPORT OCTOBER 31, 2007 2

Trust Summary as of October 31, 2007 BlackRock Core Bond Trust (BHK)

Investment Objective

The Trust’s investment objective is to provide current income and capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BHK
Initial Offering Date:	November 27, 2001
Yield on Closing Market Price as of October 31, 2007 ($12.23):1	6.57%
Current Monthly Distribution per Share:2	$0.067
Current Annualized Distribution per Share:2	$0.804
Leverage as of October 31, 2007:3	22%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on December 5, 2007. The Monthly Distribution per Common Share was decreased to $0.062. The Yield on Closing Market Price, Current Monthly Distribution and Current Annualized Distribution do not reflect the new distribution rate. The new distribution rate is not constant and is subject to further change in the future.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/07		10/31/06		Change		High		Low
Market Price		$12.23		$12.86		(4.90) %		$13.25		$11.32
Net Asset Value		$13.63		$13.82		(1.37) %		$14.01		$13.11

The following unaudited charts show the portfolio composition of the Trust’s long-term investments and credit quality allocations of the Trust’s corporate bond investments:

Portfolio Composition

Composition	10/31/07		10/31/06
Corporate Bonds	42	%	58	%
Mortgage Pass-Through Securities	36		10
Asset-Backed Securities	4		8
Commercial Mortgage-Backed Securities	4		6
U.S. Government and Agency Securities	4		5
Non-Agency Multiple Class Mortgage Pass-Through Securities	4		2
Agency Multiple Class Mortgage Pass-Through Securities	3		8
Trust Preferred Stocks	2		—
Interest Only Mortgage-Backed Securities	1		1
Interest Only Asset-Backed Securities	—		1
Foreign Government Bonds	—		1

Corporate Bond Breakdown⁴

Credit Rating	10/31/07		10/31/06
AAA/Aaa	6	%	7	%
AA/Aa	24		26
A	21		10
BBB/Baa	20		17
BB/Ba	7		12
B	16		23
CCC/Caa	6		5

4 Using the highest of Standard & Poor’s (“S&P’s”), Moody’s Investors Service (“Moody’s”) or Fitch Rating (“Fitch’s”) ratings. Corporate bonds represented approximately 66.2% and 58.3% of net assets on October 31, 2007 and 2006, respectively.

3 ANNUAL REPORT OCTOBER 31, 2007

Trust Summary as of October 31, 2007 BlackRock High Yield Trust (BHY)

Investment Objective

The Trust’s investment objective is to generate high current income and, to a lesser extent, to seek capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BHY
Initial Offering Date:	December 23, 1998
Yield on Closing Market Price as of October 31, 2007 ($6.92):1	8.84%
Current Monthly Distribution per Share:2	$0.051
Current Annualized Distribution per Share:2	$0.612
Leverage as of October 31, 2007:3	15%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution is not constant and is subject to change.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/07		10/31/06		Change			High		Low
Market Price		$6.92		$7.77		(10.94	)%		$8.70		$5.83
Net Asset Value		$7.91		$7.85		0.76	%		$8.32		$7.63

The following unaudited charts show the portfolio composition and credit quality allocations of the Trust’s corporate bond investments:

Portfolio Composition⁴

Corporate Portfolio Composition	10/31/07		10/31/06
Telecommunications	15	%	13	%
Energy	14		16
Media	11		11
Basic Materials	10		11
Financial Institutions	10		14
Consumer Products	6		6
Technology	6		5
Automotive	4		3
Entertainment & Leisure	4		4
Industrials	4		3
Health Care	3		3
Containers & Packaging	3		3
Aerospace & Defense	3		3
Transportation	2		2
Building & Development	2		3
Real Estate	1		—
Ecological Services & Equipment	1		—
Commercial Services	1		—

4 For Trust compliance purposes, the Trust’s sector and industry classification refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classification for reporting ease.

Corporate Bond Breakdown⁵

Credit Rating	10/31/07		10/31/06
BBB/Baa	4	%	3	%
BB/Ba	21		26
B	51		55
CCC/Caa	21		12
C	—		2
Not Rated	3		2

5 Using the highest of S&P’s, Moody’s or Fitch’s rating. Corporate bonds represented approximately 110.4% and 128.9% of net assets on October 31, 2007 and 2006, respectively.

ANNUAL REPORT OCTOBER 31, 2007 4

Trust Summary as of October 31, 2007 BlackRock Income Opportunity Trust (BNA)

Investment Objective

The Trust’s investment objective is to provide current income and capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BNA
Initial Offering Date:	December 20, 1991
Yield on Closing Market Price as of October 31, 2007 ($10.19):1	6.48%
Current Monthly Distribution per Share:2	$0.055
Current Annualized Distribution per Share:2	$0.660
Leverage as of October 31, 2007:3	22%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on December 5, 2007. The Monthly Distribution per Common Share was decreased to $0.051. The Yield on Closing Market Price, Current Monthly Distribution and Current Annualized Distribution do not reflect the new distribution rate. The new distribution rate is not constant and is subject to further change in the future.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/07		10/31/06		Change		High		Low
Market Price		$10.19		$10.58		(3.69)%		$10.88	$	9.13
Net Asset Value		$11.02		$11.17		(1.34)%		$11.33	$	10.53

The following unaudited charts show the portfolio composition of the Trust’s long-term investments and credit quality allocations of the Trust’s corporate bond investments:

Portfolio Composition

Composition	10/31/07		10/31/06
Corporate Bonds	38	%	48	%
Mortgage Pass-Through Securities	36		12
Asset-Backed Securities	7		13
Non-Agency Multiple Class Mortgage Pass-Through Securities	5		6
Agency Multiple Class Mortgage Pass-Through Securities	4		7
U.S. Government and Agency Securities	3		7
Commercial Mortgage-Backed Securities	3		4
Trust Preferred Stocks	2		—
Federal Housing Administration Securities	1		1
Interest Only Mortgage-Backed Securities	1		1
Inverse Floating Rate Mortgage Securities	—		1

Corporate Bond Breakdown⁴

Credit Rating	10/31/07		10/31/06
AAA/Aaa	8	%	9	%
AA/Aa	21		17
A	20		10
BBB/Baa	22		19
BB/Ba	6		13
B	17		25
CCC/Caa	6		6
Not Rated	—		1

4 Using the highest of S&P’s, Moody’s or Fitch’s rating. Corporate bonds represented approximately 64.0% and 52.1% of net assets on October 31, 2007 and 2006, respectively.

5 ANNUAL REPORT OCTOBER 31, 2007

Trust Summary as of October 31, 2007 BlackRock Income Trust Inc. (BKT)

Investment Objective

The Trust’s investment objective is to manage a portfolio of high quality securities to achieve high monthly income consistent with the preservation of capital.

Trust Information

Symbol on New York Stock Exchange:	BKT
Initial Offering Date:	July 22, 1988
Yield on Closing Market Price as of October 31, 2007 ($5.81):1	6.40%
Current Monthly Distribution per Share:2	$0.031
Current Annualized Distribution per Share:2	$0.372
Leverage as of October 31, 2007:3	8%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on December 5, 2007. The Monthly Distribution per Common Share was decreased to $0.024. The Yield on Closing Market Price, Current Monthly Distribution and Current Annualized Distribution do not reflect the new distribution rate. The new distribution rate is not constant and is subject to further change in the future.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/07		10/31/06		Change		High		Low
Market Price		$5.81		$6.07	(4.28	)%		$6.33		$5.49
Net Asset Value		$6.53		$6.48	0.77	%		$6.61		$6.25

The following unaudited chart shows the portfolio composition of the Trust’s long-term investments:

Portfolio Composition

Composition	10/31/07		10/31/06
Mortgage Pass-Through Securities	27	%	22	%
Agency Multiple Class Mortgage Pass-Through Securities	26		28
Interest Only Mortgage-Backed Securities	13		10
U.S. Government and Agency Securities	10		20
Non-Agency Multiple Class Mortgage Pass-Through Securities	9		9
Principal Only Mortgage-Backed Securities	5		5
Inverse Floating Rate Mortgage Securities	4		3
Federal Housing Administration Securities	2		2
Asset-Backed Securities	2		—
Commercial Mortgage-Backed Securities	1		—
Corporate Bonds	1		1

ANNUAL REPORT OCTOBER 31, 2007 6

Trust Summary as of October 31, 2007 BlackRock Limited Duration Income Trust (BLW)

Investment Objective

The Trust’s investment objective is to provide current income and capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BLW
Initial Offering Date:	July 30, 2003
Yield on Closing Market Price as of October 31, 2007 ($16.68):1	8.99%
Current Monthly Distribution per Share:2	$0.125
Current Annualized Distribution per Share:2	$1.500
Leverage as of October 31, 2007:3	14%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution is not constant and is subject to change.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the Trust’s market price and net asset value per share:
	10/31/07		10/31/06		Change		High		Low
Market Price		$16.68		$18.85	(11.51	) %		$19.89		$14.20
Net Asset Value		$18.52		$19.01	(2.58	) %		$19.38		$18.08

The following unaudited charts show the portfolio composition of the Trust’s long-term investments and credit quality allocations of the Trust’s corporate bond investments:

Portfolio Composition

Composition	10/31/07		10/31/06
Bank Loans	42	%	36	%
Corporate Bonds	37		43
Mortgage Pass-Through Securities	16		14
U.S. Government and Agency Securities	3		4
Foreign Government Bonds	2		2
Non-Agency Multiple Class Mortgage Pass-Through Securities	—		1

Corporate Bond Breakdown⁴

Credit Rating	10/31/07		10/31/06
AA/Aa	1	%	2	%
A	4		1
BBB/Baa	8		9
BB/Ba	23		24
B	43		51
CCC/Caa	18		11
Not Rated	3		2

4 Using the highest of S&P’s, Moody’s or Fitch’s rating. Corporate bonds represented approximately 49.1% and 64.3% of net assets on October 31, 2007 and 2006, respectively.

7 ANNUAL REPORT OCTOBER 31, 2007

Trust Summary as of October 31, 2007	BlackRock Preferred and Equity Advantage Trust (BTZ)
Investment Objective

The Trust’s investment objective is to seek current income, current gains and capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BTZ
Initial Offering Date:	December 27, 2006
Yield on Closing Market Price as of October 31, 2007 ($18.65):1	10.05%
Current Monthly Distribution per Share:2	$0.15625
Current Annualized Distribution per Share:2	$1.87500
Leverage as of October 31, 2007:3	33%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution is not constant and is subject to change.
3	As a percentage of managed assets (as defined in Note 2 of the Notes to Financial Statements).

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/2007	High	Low
Market Price	$18.65	$25.25	$15.63
Net Asset Value	$21.37	$24.35	$20.87
The following unaudited charts show the portfolio composition of the Trust’s long-term investments and credit quality allocations of the Trust’s preferred stock, trust preferred stock and corporate bond investments:

Portfolio Composition⁴

Composition	10/31/07
Financial Institutions	65	%
Energy	8
Technology	5
Consumer Products	4
Health Care	4
Telecommunications	3
Real Estate	3
Media	2
Industrials	2
Basic Materials	1
Entertainment & Leisure	1
Automotive	1
Transportation	1

⁴ For Trust compliance purposes, the Trust’s sector and industry classification refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classification for reporting ease.

Preferred, Trust Preferred and Corporate Bond Breakdown⁵

Credit Rating	10/31/07
AA/Aa	20	%
A	42
BBB/Baa	29
BB/Ba	1
B	6
CCC/Caa	1
Not Rated	1

⁵ Using the higher of S&P, Moody’s or Fitch ratings.

ANNUAL REPORT OCTOBER 31, 2007 8

Trust Summary as of October 31, 2007	BlackRock Strategic Bond Trust (BHD)
Investment Objective

The Trust’s investment objective is to seek total return through high current income and capital appreciation.

Trust Information

Symbol on New York Stock Exchange:	BHD
Initial Offering Date:	February 26, 2002
Yield on Closing Market Price as of October 31, 2007 ($11.88):1	7.78%
Current Monthly Distribution per Share:2	$0.077
Current Annualized Distribution per Share:2	$0.924

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution is not constant and is subject to change.

The table below summarizes the changes in the Trust’s market price and net asset value per share:
	10/31/07	10/31/06	Change	High	Low
Market Price	$11.88	$12.85	(7.55)%	$13.29	$10.40
Net Asset Value	$13.80	$13.83	(0.22)%	$14.19	$13.47
The following unaudited charts show the portfolio composition and credit quality allocations of the Trust’s corporate bond investments:

Corporate Portfolio Composition³

Composition	10/31/07		10/31/06
Media	17	%	14	%
Telecommunications	14		12
Energy	13		13
Financial Institutions	12		18
Aerospace & Defense	8		6
Basic Materials	6		6
Consumer Products	5		7
Technology	4		5
Automotive	4		2
Health Care	4		4
Transportation	3		1
Ecological Services & Equipment	3		2
Industrials	2		3
Containers & Packaging	2		1
Entertainment & Leisure	1		3
Building & Development	1		2
Real Estate	1		1

³ For Trust compliance purposes, the Trust’s sector and industry classification refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classification for reporting ease.

Corporate Bond Breakdown⁴

Credit Rating	10/31/07		10/31/06
AAA/Aaa	1	%	3	%
AA/Aa	4		6
A	17		12
BBB/Baa	15		13
BB/Ba	12		16
B	37		40
CCC/Caa	12		9
Not Rated	2		1

⁴ Using the highest of S&P’s, Moody’s or Fitch’s rating. Corporate bonds represented approximately 84.5% and 107.6% of net assets on October 31, 2007 and 2006, respectively.

9 ANNUAL REPORT OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
LONG-TERM INVESTMENTS—29.2%
Mortgage Pass-Through Securities—0.9%
			Federal National Mortgage Assoc.,
$	314		5.50%, 1/01/17-2/01/17	$	316,169
	14		6.50%, 7/01/29		14,777
			Total Mortgage Pass-Through Securities		330,946
Agency Multiple Class Mortgage Pass-Through Securities—9.1%
			Federal Home Loan Mortgage Corp.,
	1,745		Ser. 1510, Class G, 7.05%, 5/15/13		1,753,683
	1,098		Ser. 1598, Class J, 6.50%, 10/15/08		1,095,825
	81		Ser. 2564, Class NC, 5.00%, 2/15/33		69,195
	668		Federal National Mortgage Assoc., Ser. 49, Class H, 7.00%, 4/25/13		689,837
			Total Agency Multiple Class Mortgage Pass-Through Securities		3,608,540
Inverse Floating Rate Mortgage Securities—4.3%
	132	1	Citicorp Mortgage Securities, Inc., Ser. 14, Class A-4, 6.352%, 11/25/23		131,701
			Federal Home Loan Mortgage Corp.,
	5	1	Ser. 1425, Class SB, 11.886%, 12/15/07		4,876
	4	1	Ser. 1506, Class S, 9.708%, 5/15/08		4,468
	152	1	Ser. 1515, Class S, 8.753%, 5/15/08		152,069
	10	1	Ser. 1600, Class SC, 8.60%, 10/15/08		9,853
	144	1	Ser. 1618, Class SA, 8.25%, 11/15/08		144,815
	7	1	Ser. 1661, Class SB, 8.83%, 1/15/09		7,035
	21	1	Ser. 1688, Class S, 9.566%, 12/15/13		21,408
	105	1	Ser. 2412, Class SE, 5.519%, 2/15/09		106,281
	275	1	Ser. 2517, Class SE, 3.522%, 10/15/09		264,534
			Federal National Mortgage Assoc.,
	7	1	Ser. 13, Class SJ, 8.75%, 2/25/09		7,505
	3	1	Ser. 174, Class S, 97.223%, 9/25/22		9,514
	118	1	Ser. 192, Class SC, 6.84%, 10/25/08		117,971
	37	1	Ser. 214, Class SH, 5.592%, 12/25/08		36,653
	51	1	Ser. 214, Class SK, 10.00%, 12/25/08		52,172
	618	1	Residential Accredit Loans, Inc., Ser. QS16, Class A3, 6.435%, 10/25/17		620,297
			Total Inverse Floating Rate Mortgage Securities		1,691,152
Interest Only Mortgage-Backed Securities—2.3%
			Federal Home Loan Mortgage Corp.,
	1		Ser. 65, Class I, 918.03%, 8/15/20		1,058
	—		Ser. 141, Class H, 1,060.00%, 5/15/21		220
	1,444		Ser. 2523, Class EH, 5.50%, 4/15/20		73,865
	149		Ser. 2633, Class PI, 4.50%, 3/15/12		781
	3,531		Ser. 2739, Class PI, 5.00%, 3/15/22		94,580
	1,467		Ser. 2976, Class KI, 5.50%, 11/15/34		191,597
	1,664		Ser. 3189, Class KI, 6.00%, 1/15/35		174,439
	2,615		Ser. 3207, Class QI, 6.00%, 2/15/35		234,558
			Federal National Mortgage Assoc.,
	—		Ser. 8, Class HA, 1,199.999%, 1/25/08		105
	899		Ser. 13, Class IG, 5.00%, 10/25/22		21,655
	35	1	Ser. 20, Class SL, 10.12%, 9/25/08		1,260
	2		Ser. 49, Class L, 444.917%, 4/25/13		16,790
	4,343		Ser. 70, Class ID, 5.00%, 4/25/22		61,437
	—		Ser. G-21, Class L, 949.50%, 7/25/21		7,410
	12,042	1	Vendee Mortgage Trust, Ser. 1, 0.043%, 10/15/31		26,627
			Total Interest Only Mortgage-Backed Securities		906,382

Principal Amount (000)			Description	Value
Principal Only Mortgage-Backed Security—0.0%
$	14	2	Salomon Brothers Mortgage Securities, Inc. VI, Ser. 3, Class A, 12.50%, 10/23/17	$	13,246
Asset-Backed Securities—0.0%
	234	1,3,4,5	Global Rated Eligible Asset Trust, Ser. A, Class 1, 7.33%, 9/15/07		23
	568	1,3,5	Structured Mortgage Asset Residential Trust, Ser. 2, 8.24%, 12/15/07		57
			Total Asset-Backed Securities		80
Corporate Bond—2.6%
	1,000		Morgan Stanley Group, Inc., 10.00%, 6/15/08		1,029,161
Taxable Municipal Bonds—5.2%
	500		Fresno California Pension Oblig., 7.80%, 6/01/14		544,725
	500		Kern County California Pension Oblig., 6.98%, 8/15/09		518,005
	500		Los Angeles County California Pension Oblig., Ser. D, 6.97%, 6/30/08		506,585
	500		Orleans Parish Louisiana School Board, Ser. A, 6.60%, 2/01/08		501,925
			Total Taxable Municipal Bonds		2,071,240
Non-Agency Multiple Class Mortgage Pass-Through Securities—4.8%
	1,914	1	JPMorgan Mortgage Trust, Ser. A7, Class 2A2, 5.83%, 1/25/37		1,910,904
			Total Long-Term Investments (cost $11,827,713)		11,561,651
SHORT-TERM INVESTMENT—70.3%
U.S. Government and Agency Discount Notes—70.3%
	27,800	6	Federal Home Loan Bank Disc. Notes, 4.351%, 11/01/07 (cost $27,800,000)		27,800,000
Total Investments—99.5% (cost $39,627,7137)				$	39,361,651
Other assets in excess of liabilities—0.5%					207,328
Net Assets—100%				$	39,568,979

1	Variable rate security. Rate shown is interest rate as of October 31, 2007.
2	Rate shown is effective yield of the underlying collateral as of October 31, 2007.
3	Illiquid security. As of October 31, 2007, the Trust held less than 0.1% of its net assets, with a current market value of $80, in these securities.
4	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held less than 0.1% of its net assets, with a current market value of $23, in securities restricted as to resale.
5	Security is fair valued.
6	Rate shown is the yield to maturity as of the date of purchase.
7	Cost for federal income tax purposes is $39,627,713. The net unrealized depreciation on a tax basis is $266,062, consisting of $321,614 gross unrealized appreciation and $587,676 gross unrealized depreciation.

Portfolio Abbreviations

ADR	American Depositary Receipt
EUR	Euro
GBP	British Pound
LIBOR	London Interbank Offered Rate
PRIME	Prime Rate
REIT	Real Estate Investment Trust
TBA	To Be Announced
TBD	To Be Determined

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	10

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
LONG-TERM INVESTMENTS—158.7%
Mortgage Pass-Through Securities—58.2%
$	757	1	Citigroup Mortgage Loan Trust, Inc., Ser. 4, Class A, 5.345%, 8/25/35	$	738,529
			Federal Home Loan Mortgage Corp.,
	75		5.00%, 8/01/33		71,842
	1,428	2	5.50%, 11/01/18		1,434,281
	5,183		5.50%, 11/01/18-5/01/36		5,112,866
	2,498		6.00%, 2/01/13-12/01/18		2,545,922
	23		7.00%, 9/01/31		23,749
	59	1	7.379%, 5/01/32		60,118
	4,000		TBA, 5.50%, 12/12/37		3,935,000
			Federal National Mortgage Assoc.,
	44		4.50%, 2/01/20		42,798
	10,051		5.00%, 11/01/17-6/01/37		9,870,125
	12,498	2	5.00%, 1/01/18-5/01/37		12,026,793
	2,747		5.50%, 1/01/18-7/01/34		2,719,784
	43,246	2	5.50%, 12/01/35-4/01/36		42,661,096
	6,658	2	6.00%, 2/01/36-10/01/36		6,708,610
	3,159		6.00%, 8/01/29-11/01/36		3,182,236
	289		7.00%, 1/01/31-7/01/32		302,834
	400		TBA, 5.00%, 11/19/22		393,750
	85,500		TBA, 5.50%, 11/19/22-11/13/37		84,249,051
	18,900		TBA, 6.00%, 11/13/37-12/12/37		19,019,812
	15,600		TBA, 6.50%, 12/12/37		15,946,133
			Government National Mortgage Assoc.,
	205		5.50%, 8/15/33		204,241
	200		TBA, 6.50%, 11/20/37		205,312
	760	1	GSR Mortgage Loan Trust, Ser. AR4, Class 6A1, 5.25%, 7/25/35		739,031
			Small Business Administration,
	767		Ser. P10B, Class 1, 4.754%, 8/01/14		751,230
	1,351		Ser. P10B, Class 1, 5.136%, 8/01/13		1,352,827
			Total Mortgage Pass-Through Securities		214,297,970
Federal Housing Administration Security—0.3%
	1,028		FHA Hebre Home Hospital, 6.25%, 9/01/28		1,038,331
Agency Multiple Class Mortgage Pass-Through Securities—4.0%
			Federal Home Loan Mortgage Corp.,
	1,200		Ser. 2562, Class PG, 5.00%, 1/15/18		1,185,166
	2,170		Ser. 2775, Class OE, 4.50%, 4/15/19		2,056,897
	2,959		Ser. 2806, Class VC, 6.00%, 12/15/19		3,008,150
	1,306		Ser. 2825, Class VP, 5.50%, 6/15/15		1,322,326
	1,300		Ser. 2883, Class DR, 5.00%, 11/15/19		1,257,396
	1,600		Ser. 2968, Class EG, 6.00%, 10/15/34		1,622,310
			Federal National Mortgage Assoc.,
	2,691		Ser. 5, Class PK, 5.00%, 12/25/34		2,684,529
	1,663	1	Ser. 118, Class FD, 5.273%, 12/25/33		1,651,013
			Total Agency Multiple Class Mortgage Pass-Through Securities		14,787,787
Asset-Backed Securities—6.7%
	2,300		Chase Issuance Trust, Ser. A17, Class A, 5.12%, 10/15/14		2,315,364
	2,800		Chase Manhattan Auto Owner Trust, Ser. B, Class A4, 4.88%, 6/15/12		2,801,647
	2,825		Citibank Credit Card Issuance Trust, Ser. A2, Class A2, 4.85%, 2/10/11		2,826,461
	229	1	Countrywide Asset-Backed Certificates, Ser. 16, Class 4AV1, 4.973%, 1/25/35		228,876
	2,406		DaimlerChrysler Auto Trust, Ser. A, Class A3, 5.00%, 5/08/10		2,406,171
	2,850		Ford Credit Auto Owner Trust, Ser. A, Class A4, 5.08%, 12/15/10		2,860,611
	2,300		Harley-Davidson Motorcycle Trust, Ser. 2, Class A2, 4.07%, 2/15/12		2,283,930
	2,500		Maryland Trust, Ser. 1, Class A, 5.55%, 12/10/65		2,371,875

Principal Amount (000)			Description	Value
Asset Backed Securities—(cont’d)
$	2,825		MBNA Credit Card Master Note Trust, Ser. A1, Class A, 4.90%, 7/15/11	$	2,830,207
	59	1	New Century Home Equity Loan Trust, Ser. C, Class A2A, 4.953%, 1/25/36		59,262
	564	1	SLM Student Loan Trust, Ser. 5, Class A1, 5.084%, 1/25/18		564,436
	471	1	Structured Asset Investment Loan Trust, Ser. 1, Class A1, 4.953%, 1/25/36		469,358
	2,725		USAA Auto Owner Trust, Ser. 1 Class A4, 5.04%, 12/15/11		2,738,565
			Total Asset-Backed Securities		24,756,763
Interest Only Asset-Backed Securities—0.2%
			Sterling Coofs Trust,
	12,656		Ser. 1, 2.365%, 4/15/29		561,620
	10,125	3	Ser. 2, 2.081%, 3/30/30		272,114
			Total Interest Only Asset-Backed Securities		833,734
Interest Only Mortgage-Backed Securities—1.0%
			Federal Home Loan Mortgage Corp.,
	2,104		Ser. 2579, Class HI, 5.00%, 8/15/17		242,617
	5,772		Ser. 2611, Class QI, 5.50%, 9/15/32		1,047,320
			Federal National Mortgage Assoc.,
	23,975	1	Ser. 90, Class JH, 1.828%, 11/25/34		1,341,116
	4,030		Ser. 378, Class 5, 5.00%, 7/01/36		980,948
			Total Interest Only Mortgage-Backed Securities		3,612,001
Commercial Mortgage-Backed Securities—6.4%
	2,180	1	Banc of America Commerical Mortgage, Inc., Ser. 1, Class A4, 4.871%, 11/10/42		2,163,105
	2,720		Credit Suisse First Boston Mortgage Securities Corp., Ser. CP5, Class A2, 4.94%, 12/15/35		2,667,298
	2,170	1	Credit Suisse Mortgage Capital Certificates, Ser. C2, Class A3, 5.542%, 1/15/49		2,147,296
	1,463	1	General Motor Acceptance Corp. Commercial Mortgage Securities, Inc., Ser. C3, Class A2, 7.179%, 8/15/36		1,504,810
	1,973		Goldman Sachs Mortgage Securities Corp. II, Ser. C1, Class A3, 6.135%, 10/18/30		1,977,721
	1,435	1	Heller Financial Commercial Mortgage Asset Co., Ser. PH1, Class A2, 6.847%, 5/15/31		1,453,914
			JPMorgan Chase Commercial Mortgage Securities Corp.,
	2,140		Ser. C1, Class A3, 5.857%, 10/12/35		2,185,265
	2,180		Ser. CBX, Class A4, 4.529%, 1/12/37		2,131,593
	1,652	1	JPMorgan Commercial Mortgage Finance Corp., Ser. C10, Class A2, 7.371%, 8/15/32		1,717,907
	2,082	1	Morgan Stanley Capital Trust I, Ser. HF2, Class A2, 6.48%, 11/15/30		2,089,181
	3,489	1	Salomon Brothers Mortgage Securities VII, Ser. C1, Class A2, 7.52%, 12/18/09		3,619,954
			Total Commercial Mortgage-Backed Securities		23,658,044
Corporate Bonds—66.2%
Aerospace & Defense—1.1%
	150	3	Bombardier, Inc., 8.00%, 11/15/14 (Canada)		156,000
	1,195		DI Finance/DynCorp Intl., Ser. B, 9.50%, 2/15/13		1,269,688
			DRS Technologies, Inc.,
	70		6.875%, 11/01/13		70,000
	80		7.625%, 2/01/18		81,800
	960		Northrop Grumman Corp., 7.875%, 3/01/26		1,147,117
	15		Sequa Corp., 9.00%, 8/01/09		16,088
	120		TransDigm, Inc., 7.75%, 7/15/14		122,100
	1,125		United Technologies Corp., 4.875%, 5/01/15		1,088,382
			Total Aerospace & Defense		3,951,175
Automotive—1.0%
	265		Accuride Corp., 8.50%, 2/01/15		249,100
			AutoNation, Inc.,
	150		7.00%, 4/15/14		145,125
	150	1	7.243%, 4/15/13		146,625
	600		Ford Capital BV, 9.50%, 6/01/10 (Netherlands)		604,500

See Notes to Financial Statements.
11	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Automotive—(cont’d)
$	360		Lear Corp., Ser. B, 8.75%, 12/01/16	$	345,600
	250		Metaldyne Corp., 10.00%, 11/01/13		232,500
	2,100		Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13		2,121,000
			Total Automotive		3,844,450
Basic Materials—3.3%
	500		Abitibi-Consolidated, Inc., 6.00%, 6/20/13 (Canada)		367,500
	995		AK Steel Corp., 7.75%, 6/15/12		1,014,900
	250		American Pacific Corp., 9.00%, 2/01/15		256,250
	80	1	Bowater, Inc., 8.694%, 3/15/10		73,200
	30		Chemtura Corp., 6.875%, 6/01/16		28,650
	200		CPG Intl. I, Inc., 10.50%, 7/01/13		200,000
	60		Domtar, Inc., 7.125%, 8/15/15 (Canada)		59,400
			Freeport-McMoRan Copper & Gold, Inc.,
	1,020		8.375%, 4/01/17		1,116,900
	330	1	8.394%, 4/01/15		340,725
	66		Huntsman LLC, 12.00%, 7/15/12		71,775
			Ineos Group Holdings Plc (United Kingdom)
	285		7.875%, 2/07/16 (EUR)		379,810
	1,330	3	8.50%, 2/15/16		1,263,500
	885		Innophos, Inc., 8.875%, 8/15/14		891,638
	515	3	Key Plastics LLC/Key Plastics Finance Corp., 11.75%, 3/15/13		437,750
	1,705		NewPage Corp., 10.00%, 5/01/12		1,803,037
			Noranda, Inc. (Canada)
	825		6.00%, 10/15/15		830,709
	1,250		6.20%, 6/15/35		1,200,827
	1,430		Teck Cominco Ltd., 6.125%, 10/01/35 (Canada)		1,354,563
	430		Terra Capital, Inc., Ser. B, 7.00%, 2/01/17		430,000
			Total Basic Materials		12,121,134
Building & Development—0.2%
	440		Goodman Global Holding Co., Inc., 7.875%, 12/15/12		459,800
	140		Nortek, Inc., 8.50%, 9/01/14		123,900
	85		North American Energy Partners, Inc., 8.75%, 12/01/11 (Canada)		85,850
			Total Building & Development		669,550
Commercial Services—0.1%
	100		FTI Consulting, Inc., 7.75%, 10/01/16		104,500
	200	3	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		195,000
			Total Commercial Services		299,500
Consumer Products—2.5%
	650	1	Ames True Temper, Inc., 9.243%, 1/15/12		624,000
	30	1	Avis Budget Car Rental LLC/Avis Budget Finance, Inc., 8.058%, 5/15/14		29,625
	775		CVS Caremark Corp., 6.25%, 6/01/27		770,626
	695		Federated Retail Holdings, Inc., 5.90%, 12/01/16		663,511
			General Nutrition Centers, Inc.,
	500	1	10.009%, 3/15/14		481,250
	400		10.75%, 3/15/15		389,000
	850		Kimberly-Clark Corp., 6.625%, 8/01/37		935,813
	1,515		Kraft Foods, Inc., 7.00%, 8/11/37		1,644,963
	314		Lazy Days RV Center, Inc., 11.75%, 5/15/12		282,600
			Michaels Stores, Inc.,
	470		10.00%, 11/01/14		473,525
	600	2	11.375%, 11/01/16		598,500
	1,000		Pantry, Inc. (The), 7.75%, 2/15/14		975,000
	175		Quiksilver, Inc., 6.875%, 4/15/15		163,188
	250		Reynolds American, Inc., 7.625%, 6/01/16		270,479
	775		Rite Aid Corp., 7.50%, 3/01/17		720,750
	390		Sally Holdings LLC, 10.50%, 11/15/16		388,050
			Total Consumer Products		9,410,880

Principal Amount (000)			Description	Value
Containers & Packaging—0.8%
			Berry Plastics Holding Corp.,
$	270		8.875%, 9/15/14	$	276,750
	180	1	9.569%, 9/15/14		180,450
	150		Crown Americas LLC/Crown Americas Capital Corp., 7.75%, 11/15/15		154,500
	75		Graham Packaging Co., Inc., 8.50%, 10/15/12		74,438
	300	1,3	Impress Holdings BV, 8.368%, 9/15/13 (Netherlands)		298,426
	1,500		Owens Brockway, 8.25%, 5/15/13		1,560,000
	545		Pregis Corp., 12.375%, 10/15/13		594,050
			Total Containers & Packaging		3,138,614
Ecological Services & Equipment—0.2%
	590		Waste Services, Inc., 9.50%, 4/15/14		590,000
Energy—9.7%
	425		Amerada Hess Corp., 7.125%, 3/15/33		469,065
	2,350		Anadarko Petroleum Corp., 6.45%, 9/15/36		2,377,558
	140		Berry Petroleum Co., 8.25%, 11/01/16		142,800
	875		Burlington Resources Finance Co., 7.40%, 12/01/31 (Canada)		1,031,161
	375		Canadian Natural Resources Ltd., 6.25%, 3/15/38 (Canada)		370,540
	320		Chaparral Energy, Inc., 8.50%, 12/01/15		298,400
			Chesapeake Energy Corp.,
	150		6.375%, 6/15/15		145,500
	20		6.875%, 11/15/20		19,550
	500		Cleveland Electric Illuminating Co., 5.95%, 12/15/36		463,733
			Compagnie Generale de Geophysique-Veritas (France)
	55		7.50%, 5/15/15		56,100
	90		7.75%, 5/15/17		92,700
	235		Compton Petroleum Finance Corp.,
			7.625%, 12/01/13 (Canada)		225,013
	125		Conoco Funding Co., 7.25%, 10/15/31 (Canada)		145,774
	535		ConocoPhillips Funding Co., 5.95%, 10/15/36 (Canada)		548,451
	650		ConocoPhillips Holding Co., 6.95%, 4/15/29		740,160
	100		Devon Energy Corp., 7.95%, 4/15/32		122,312
	725		DTE Energy Co., 6.35%, 6/01/16		750,656
	115		Edison Mission Energy, 7.50%, 6/15/13		116,581
	1,125	3	EDP Finance BV, 6.00%, 2/02/18 (Netherlands)		1,122,493
			El Paso Natural Gas Co.,
	265		8.625%, 1/15/22		308,335
	225		8.875%, 6/15/32		262,282
	124		Elwood Energy LLC, 8.159%, 7/05/26		127,055
			EnCana Corp., (Canada)
	1,000		6.50%, 8/15/34		1,045,819
	700		6.625%, 8/15/37		739,318
			Encore Acquisition Co.,
	40		6.00%, 7/15/15		36,200
	60		7.25%, 12/01/17		57,450
	1,500		Energy East Corp., 6.75%, 7/15/36		1,546,705
	130		Exco Resources, Inc., 7.25%, 1/15/11		128,375
	950		Florida Power & Light Co., 4.95%, 6/01/35		824,533
	675		Florida Power Corp., 6.35%, 9/15/37		708,736
	80		Grant Prideco, Inc., Ser. B, 6.125%, 8/15/15		80,400
	210		KCS Energy, Inc., 7.125%, 4/01/12		206,850
	700		Midamerican Energy Co., 5.80%, 10/15/36		680,105
			Midamerican Energy Holdings Co.,
	800		5.95%, 5/15/37		766,990
	1,525	3	6.50%, 9/15/37		1,563,997
	75		Midwest Generation LLC, Ser. B, 8.56%, 1/02/16		80,767
	155		Mirant Americas Generation LLC, 8.30%, 5/01/11		156,744
	1,050	3	Nakilat, Inc., 6.067%, 12/31/33 (Qatar)		995,715
	550		Nexen, Inc., 6.40%, 5/15/37 (Canada)		547,239
			NRG Energy, Inc.,
	50		7.25%, 2/01/14		50,000
	285		7.375%, 2/01/16		284,288

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	12

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Energy—(cont’d)
$	1,000		Ohio Edison Co., 6.875%, 7/15/36	$	1,047,284
	425		ONEOK Partners LP, 6.65%, 10/01/36		432,782
	450	3	OPTI, Inc., 8.25%, 12/15/14 (Canada)		451,125
	130		Orion Power Holdings, Inc., 12.00%, 5/01/10		143,650
	575		Pacificorp, 6.25%, 10/15/37		590,146
	1,650		Pemex Project Funding Master Trust, 9.625%, 12/02/08		1,725,900
	1,200		Public Service Co. of Colorado, 6.25%, 9/01/37		1,245,049
	330		Sabine Pass LNG LP, 7.50%, 11/30/16		323,400
	700		Scottish Power Plc, 5.375%, 3/15/15 (United Kingdom)		689,766
	315	3	SemGroup LP, 8.75%, 11/15/15		302,400
			Southern California Edison Co.,
	625		5.625%, 2/01/36		596,659
	125		Ser. 05-E, 5.35%, 7/15/35		113,955
	645		Suncor Energy, Inc., 6.50%, 6/15/38 (Canada)		675,171
	320	3	Targa Resources, Inc., 8.50%, 11/01/13		323,200
	550		Trans-Canada Pipelines Ltd., 5.85%, 3/15/36 (Canada)		527,368
	950		Valero Energy Corp., 6.625%, 6/15/37		978,133
	2,000		Virginia Electric & Power Co., Ser. A, 6.00%, 5/15/37		1,965,206
	625	3	Weatherford Int’l., Inc., 6.80%, 6/15/37		655,387
	375		Whiting Petroleum Corp., 7.25%, 5/01/12-5/01/13		368,638
	1,925		XTO Energy, Inc., 6.75%, 8/01/37		2,064,924
			Total Energy		35,656,593
Entertainment & Leisure—0.6%
	185		AMC Entertainment, Inc., 11.00%, 2/01/16		200,263
	1,000		Circus & Eldorado Joint Venture, 10.125%, 3/01/12		1,040,000
	150		Gaylord Entertainment Co., 6.75%, 11/15/14		145,500
	335	3	Greektown Holdings LLC, 10.75%, 12/01/13		333,325
	375		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		276,562
	260		Seneca Gaming Corp., Ser. B, 7.25%, 5/01/12		261,950
	40		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., 6.625%, 12/01/14		39,300
			Total Entertainment & Leisure		2,296,900
Financial Institutions—23.6%
			American Real Estate Partners LP/American Real Estate Finance Corp.,
	320		7.125%, 2/15/13		312,000
	3,165		8.125%, 6/01/11		3,188,737
	2,575		Bank of America Corp., 6.00%, 9/01/17		2,625,030
	1,975		Bank of America NA, Ser. BKNT, 6.10%, 6/15/17		2,021,363
	325		Bank One Corp., 3.70%, 1/15/08		324,161
	1,400		BankBoston NA, 6.375%, 3/25/08-4/15/08		1,406,364
	1,270		Bear Stearns Cos., Inc. (The), Ser. MTN, 6.95%, 8/10/12		1,321,679
	350	3	Belvoir Land LLC, Ser. A1, 5.27%, 12/15/47		310,765
	1,075		Berkshire Hathaway Finance Corp., 4.75%, 5/15/12		1,059,247
	181	1,3	BMS Holdings, Inc., 12.40%, 2/15/12		173,374
	1,100		Chubb Corp., 6.00%, 5/11/37		1,070,352
	600		CitiFinancial, 6.25%, 1/01/08		600,878
			Citigroup, Inc.,
	3,950	4	3.625%, 2/09/09		3,891,149
	4,790	4	4.125%, 2/22/10		4,709,978
	1,020		4.25%, 7/29/09		1,007,887
	1,005		5.875%, 2/22/33-5/29/37		955,122
	525		6.875%, 2/15/98		534,624
	3,775	3	Depfa ACS Bank, 5.125%, 3/16/37 (Ireland)		3,570,723
			Ford Motor Credit Co. LLC,
	340		7.80%, 6/01/12		319,456
	200	1	7.993%, 1/13/12		185,155
	525	3	Fort Irwin Land LLC, Ser. A-1, 5.03%, 12/15/25		495,254
	6,855	2	General Electric Capital Corp., Ser. GMTN, 6.15%, 8/07/37		7,103,041

Principal Amount (000)			Description	Value
Financial Institutions—(cont’d)
			Goldman Sachs Group, Inc. (The),
$	1,415		5.35%, 1/15/16	$	1,377,548
	4,885		5.45%, 11/01/12		4,914,139
	135		6.25%, 9/01/17		140,028
	925	1	Hartford Life Global Funding Trusts, Ser. MTN, 5.864%, 9/15/09		924,002
	825	3	HBOS Treasury Services Plc, 3.75%, 9/30/08 (United Kingdom)		812,767
	775		HSBC Bank NA, 5.875%, 11/01/34		716,502
	300		HSBC Holdings Plc, 6.50%, 5/02/36 (United Kingdom)		296,167
	799	3	iPayment Investors LP, 11.625%, 7/15/14		822,779
	240		iPayment, Inc., 9.75%, 5/15/14		230,400
	1,500	3	Irwin Land LLC, 5.40%, 12/15/47		1,378,395
	3,950		JPMorgan Chase Capital XXV, Ser. Y, 6.80%, 10/01/37		3,945,643
			Lehman Brothers Holdings, Inc.,
	1,875		6.50%, 7/19/17		1,888,348
	525	1	Ser. MTN, 7.394%, 9/15/22		536,446
	1,525		MetLife, Inc., 5.70%, 6/15/35		1,413,587
	1,150	3	Metropolitan Global Funding I, 4.25%, 7/30/09		1,136,666
			Momentive Performance Materials, Inc.,
	40	3	9.75%, 12/01/14		39,000
	405	3	11.50%, 12/01/16		390,825
	1,810	1,3	Monumental Global Funding Ltd., Ser. MTN, 5.24%, 6/16/10 (Cayman Islands)		1,793,710
			Morgan Stanley,
	3,300	1	5.493%, 1/09/12		3,246,860
	525		6.25%, 8/09/26		517,443
	1,700		Ser. MTN, 6.25%, 8/28/17		1,740,576
	1,375		Ser. MTN, 5.55%, 4/27/17		1,338,083
	850	3	New York Life Global Funding, 3.875%, 1/15/09		843,505
	350		Ohana Military Communities LLC, Ser. 04I, 6.193%, 4/01/49		357,088
			Prudential Financial, Inc.,
	500		5.90%, 3/17/36		471,162
	675		Ser. MTN, 5.70%, 12/14/36		626,303
	1,000	3	Prudential Funding LLC, 6.60%, 5/15/08		1,006,033
			Rainbow National Services LLC,
	200	3	8.75%, 9/01/12		208,000
	943	3	10.375%, 9/01/14		1,037,300
	550	1	SLM Corp., 5.384%, 1/27/14		486,399
	2,170	5	Structured Asset Receivable Trust, 5.68%, 1/21/10		2,148,367
			SunTrust Bank,
	995		4.00%, 10/15/08		985,997
	1,265		4.415%, 6/15/09		1,249,858
	235	3	TIAA Global Markets, Inc., 3.875%, 1/22/08		234,326
	975		Travelers Cos., Inc., Ser. MTN, 6.25%, 6/15/37		961,956
	50	1	Universal City Florida Holding Co. I/II, 9.661%, 5/01/10		51,125
	2,790	2	US Bank NA, 6.50%, 2/01/08		2,794,765
	495	3	USAA Capital Corp., 4.00%, 12/10/07		494,478
			Wells Fargo & Co.,
	1,031		3.12%, 8/15/08		1,013,318
	355		4.20%, 1/15/10		349,594
	1,665		4.625%, 8/09/10		1,648,918
	435		4.875%, 1/12/11		432,628
	540		Wells Fargo Bank NA, 5.95%, 8/26/36		532,155
	605	3	Wimar Opco LLC/Wimar Opco Finance Corp., 9.625%, 12/15/14		453,750
	1,775	3	Xstrata Finance Ltd., 5.80%, 11/15/16 (Canada)		1,760,351
			Total Financial Institutions		86,933,629
Health Care—3.5%
	1,205	1,3	Amgen, Inc., 5.585%, 11/28/08		1,202,827
	1,625		AstraZeneca Plc, 6.45%, 9/15/37 (United Kingdom)		1,712,300
	340		Bristol-Myers Squibb Co., 5.875%, 11/15/36		333,724
	2,275	2	Eli Lilly & Co., 5.55%, 3/15/37		2,172,348
	1,125		Johnson & Johnson, 5.95%, 8/15/37		1,176,591
	1,125		Schering-Plough Corp., 6.55%, 9/15/37		1,165,932

See Notes to Financial Statements.
13	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Health Care—(cont’d)
$	1,020		Tenet Healthcare Corp., 6.50%, 6/01/12	$	864,450
	995		Teva Pharmaceutical Finance LLC, 6.15%, 2/01/36		979,429
	870		UnitedHealth Group, Inc., 5.80%, 3/15/36		837,188
			WellPoint, Inc.,
	955		5.85%, 1/15/36		897,356
	85		5.95%, 12/15/34		82,113
			Wyeth,
	925		5.95%, 4/01/37		914,805
	675		6.00%, 2/15/36		668,576
			Total Health Care		13,007,639
Industrials—1.4%
	1,575		3M Co., Ser. MTN, 5.70%, 3/15/37		1,579,348
	360	3	AGY Holding Corp., 11.00%, 11/15/14		354,600
	140		Hexcel Corp., 6.75%, 2/01/15		137,550
	975		Honeywell Intl., Inc., 5.70%, 3/15/37		947,863
	120		Park-Ohio Industries, Inc., 8.375%, 11/15/14		111,900
			RBS Global, Inc./Rexnord Corp.,
	480		9.50%, 8/01/14		495,600
	505		11.75%, 8/01/16		535,300
	950	3	Sunstate Equipment Co. LLC, 10.50%, 4/01/13		912,000
			Total Industrials		5,074,161
Media—6.2%
			Affinion Group, Inc.,
	515		10.125%, 10/15/13		536,887
	180		11.50%, 10/15/15		187,650
	100		American Media Operations, Inc., Ser. B, 10.25%, 5/01/09		95,750
			AOL Time Warner, Inc.,
	90		6.625%, 5/15/29		90,172
	3,040		7.57%, 2/01/24		3,331,311
	205		7.625%, 4/15/31		228,088
	85		7.70%, 5/01/32		95,515
	180	1	Cablevision Systems Corp., Ser. B, 9.644%, 4/01/09		184,950
	110		CanWest MediaWorks, Inc., 8.00%, 9/15/12 (Canada)		107,250
	430		Charter Communications Holdings I LLC/Charter Communications Holdings I Capital Corp., 11.00%, 10/01/15		417,100
			Charter Communications Holdings II LLC/Charter
			Communications Holdings II Capital Corp.,
	1,545		10.25%, 9/15/10		1,575,900
	130		Ser. B, 10.25%, 9/15/10		132,275
	645		CMP Susquehanna Corp., 9.875%, 5/15/14		592,594
			Comcast Corp.,
	790		6.45%, 3/15/37		796,377
	2,375		6.50%, 1/15/17-11/15/35		2,464,004
	25		6.95%, 8/15/37		26,753
	75		Dex Media West LLC/Dex Media Finance Co., Ser. B, 9.875%, 8/15/13		79,969
	125		DirecTV Holdings LLC/DirecTV Financing Co., 8.375%, 3/15/13		130,625
			EchoStar DBS Corp.,
	175		5.75%, 10/01/08		174,563
	290		7.00%, 10/01/13		301,962
	75		7.125%, 2/01/16		78,375
	620		Idearc, Inc., 8.00%, 11/15/16		621,550
	600	1,3	ION Media Networks, Inc., 8.493%, 1/15/12		601,500
	485		Network Communications, Inc., 10.75%, 12/01/13		488,031
			News America Holdings, Inc.,
	985		7.625%, 11/30/28		1,092,925
	825		7.70%, 10/30/25		917,857
	625		8.45%, 8/01/34		755,622
	560		Nexstar Finance, Inc., 7.00%, 1/15/14		537,600
			Nielsen Finance LLC/Nielsen Finance Co.,
	300	6	9.115%, 8/01/16		216,750
	965		10.00%, 8/01/14		1,015,662
	865		RH Donnelley Corp., Ser. A-3, 8.875%, 1/15/16		865,000

Principal Amount (000)			Description	Value
Media—(cont’d)
$	70		Sirius Satellite Radio, Inc., 9.625%, 8/01/13	$	69,563
			TCI Communications, Inc.,
	200		7.125%, 2/15/28		212,777
	620		7.875%, 8/01/13-2/15/26		705,603
	70		Time Warner Cos., Inc., 6.95%, 1/15/28		72,559
	1,000	3	TL Acquisitions, Inc., 10.50%, 1/15/15		995,000
	350	3	Univision Communications, Inc., 9.75%, 3/15/15		343,000
	645		Vertis, Inc., 9.75%, 4/01/09		645,000
	1,205		Young Broadcasting, Inc., 10.00%, 3/01/11		1,132,700
			Total Media		22,916,769
Real Estate—0.9%
			AvalonBay Communities, Inc.,
	350		6.625%, 9/15/11		364,056
	775		8.25%, 7/15/08		792,236
			Rouse Co.,
	895		3.625%, 3/15/09		853,281
	1,650		5.375%, 11/26/13		1,495,190
			Total Real Estate		3,504,763
Technology—1.9%
			Amkor Technology, Inc.,
	80		7.75%, 5/15/13		77,400
	145		9.25%, 6/01/16		148,263
	250		Celestica, Inc., 7.625%, 7/01/13 (Canada)		240,000
			Freescale Semiconductor, Inc.,
	655		9.125%, 12/15/14		592,775
	140	1	9.569%, 12/15/14		128,625
	3,125	2	Intl. Business Machines Corp., 5.70%, 9/14/17		3,171,831
	440		NXP BV/NXP Funding LLC, 9.50%, 10/15/15 (Netherlands)		415,800
	630		Sanmina-SCI Corp., 8.125%, 3/01/16		552,825
			SunGard Data Systems, Inc.,
	105		9.125%, 8/15/13		107,100
	610		10.25%, 8/15/15		635,925
	945		Superior Essex Communications LLC/Essex Group, Inc.,
			9.00%, 4/15/12		933,187
			Total Technology		7,003,731
Telecommunications—8.7%
	2,875	2	AT&T, Inc., 6.50%, 9/01/37		3,032,607
	1,700	6	BellSouth Telecommunications, 6.402%, 12/15/95		902,807
	210		Cincinnati Bell, Inc., 7.25%, 7/15/13		210,525
	225		Cricket Communications, Inc., 9.375%, 11/01/14		223,313
	3,000	2	Deutsche Telekom Intl. Finance BV,
			5.75%, 3/23/16 (Netherlands)		3,007,887
			Digicel Group Ltd., (Bermuda)
	240	3	8.875%, 1/15/15		224,112
	560	3	9.125%, 1/15/15		523,340
	190	1	Hawaiian Telcom Communications, Inc., Ser. B, 10.318%, 5/01/13		192,375
	475		Intelsat Corp., 9.00%, 6/15/16		485,687
			Intelsat Ltd. (Bermuda)
	95	1	8.886%, 1/15/15		96,425
	500		9.25%, 6/15/16		518,750
	200		11.25%, 6/15/16		215,000
	870	1	11.409%, 6/15/13		906,975
	295		Intelsat Subsidiary Holding Co. Ltd., 8.625%, 1/15/15 (Bermuda)		299,425
	120	3	MetroPCS Wireless, Inc., 9.25%, 11/01/14		119,100
	770	3	Nordic Telephone Co. Holdings A.p.S., 8.875%, 5/01/16 (Denmark)		814,275
	1,120	1,3	Nortel Networks Ltd., 9.493%, 7/15/11 (Canada)		1,106,000
	155		PanAmSat Corp., 9.00%, 8/15/14		158,100
			Qwest Corp.,
	200		7.875%, 9/01/11		211,000
	470	1	8.944%, 6/15/13		501,137
	780		SBC Communications, Inc., 6.45%, 6/15/34		810,601
	1,715		Sprint Capital Corp., 6.875%, 11/15/28		1,642,877

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	14

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Telecommunications—(cont’d)
			Telecom Italia Capital S.A. (Luxembourg)
$	1,075		4.95%, 9/30/14	$	1,028,927
	1,550		6.00%, 9/30/34		1,484,579
	1,975		Telefonica Emisones SAU, 7.045%, 6/20/36 (Spain)		2,169,348
	725		Telefonica Europe BV, 7.75%, 9/15/10 (Netherlands)		776,297
	70		Verizon Global Funding Corp., 7.75%, 12/01/30		82,465
	125		Verizon Maryland, Inc., 5.125%, 6/15/33		104,256
			Verizon New Jersey, Inc.,
	230		7.85%, 11/15/29		261,440
	335		Ser. A, 5.875%, 1/17/12		342,618
	3,150	2	Verizon Virginia, Inc., 4.625%, 3/15/13		3,024,873
			Vodafone Group Plc, (United Kingdom)
	1,465	1	5.288%, 12/28/07		1,465,296
	2,504		7.75%, 2/15/10		2,648,073
	1,100		West Corp., 11.00%, 10/15/16		1,152,250
	350	3	Wind Acquisition Finance S.A., 10.75%, 12/01/15 (Luxembourg)		389,375
			Windstream Corp.,
	500		8.125%, 8/01/13		528,750
	230		8.625%, 8/01/16		246,100
			Total Telecommunications		31,906,965
Transportation—0.5%
	115		American Airlines, Inc., Ser. 99-1, 7.324%,4/15/11		113,563
	110		Britannia Bulk Plc, 11.00%, 12/01/11 (United Kingdom)		115,500
	350		Canadian National Railway Co., 6.25%, 8/01/34 (Canada)		352,778
	405		CHC Helicopter Corp., 7.375%, 5/01/14 (Canada)		391,837
	500		Navios Maritime Holdings, Inc., 9.50%, 12/15/14 (Marshall Islands)		528,750
	360	3	St. Acquisition Corp., 12.50%, 5/15/17		229,500
			Total Transportation		1,731,928
			Total Corporate Bonds		244,058,381
U.S. Government and Agency Securities—5.8%
	1,670		Aid to Israel, 5.50%, 4/26/24-9/18/33		1,753,313
	1,050		Resolution Funding Corp., Zero Coupon, 7/15/18-10/15/18		623,776
	1,655		Tennessee Valley Authority, Ser. C, 5.88%, 4/01/36		1,829,397
	330		U.S. Treasury Bonds, 4.75%, 2/15/37		329,820
	5,832	2	U.S. Treasury Inflation Protected Bond, 2.375%, 1/15/27		5,982,762
	10,450	2	U.S. Treasury Notes, 4.75%, 8/15/17		10,680,242
			Total U.S. Government and Agency Securities		21,199,310
Foreign Government Bond—0.4%
	1,100		France, 3.75%, 4/25/17		1,522,816
Non-Agency Multiple Class Mortgage Pass-Through Securities—5.5%
	1,600		Countrywide Alternative Loan Trust, Ser. 64CB, Class 1A15, 5.50%, 12/25/35		1,504,462
	2,755	1	CW Capital Cobalt Ltd., Ser. C3, Class A4, 5.82%, 5/15/46		2,830,870
			First Union National Bank Commercial Mortgage,
	3,044		Ser. C3, Class A3, 6.423%, 8/15/33		3,151,030
	2,265		Ser. C4, Class A2, 6.223%, 12/12/33		2,340,547
	2,350		General Motor Acceptance Corp. Commercial Mortgage Securities, Inc., Ser. C4, Class A2, 4.93%,7/10/39		2,308,750
	960		JPMorgan Chase Commercial Mortgage Securities Corp., Ser. LDP9, Class A3, 5.336%, 5/15/47		936,591
	2,275	1	LB-UBS Commercial Mortgage Trust, Ser. C6, Class A4, 5.858%, 7/15/40		2,304,488
	925	1,7	Merrill Lynch Mortgage Trust, Ser. C1, Class AM, 5.83%, 6/12/50		933,463
	995	1	Morgan Stanley Capital I, Ser. T27, Class A4, 5.651%, 6/11/42		999,692
	2,305		Structured Asset Securities Corp., Ser. AL1, Class A2, 3.45%, 2/25/32		1,977,073
	995	1	Wachovia Bank Commercial Mortgage Trust, Ser. C33, Class A4, 5.903%, 2/15/51		1,017,710
			Total Non-Agency Multiple Class Mortgage Pass-Through Securities		20,304,676

Principal Amount (000)			Description	Value
Taxable Municipal Bond—0.3%
$	1,000		Illinois St. Pension, 5.10%, 6/01/33	$	948,570
Trust Preferred Stocks—3.3%
	1,950	1	Allstate Corp., 6.50%, 5/15/57		1,890,800
	545		BAC Capital Trust XI, 6.625%, 5/23/36		553,198
	850	1,3,8	Barclays Bank Plc, 7.434% (United Kingdom)		901,035
	915	1,3,8	Credit Agricole S.A., 6.637% (France)		869,590
	1,550	1,8	Credit Suisse Ltd., 5.86% (Guernsey)		1,443,920
	675	1	Lincoln National Corp., 6.05%, 4/20/67		646,921
	790		Peco Energy Capital Trust IV, 5.75%, 6/15/33		672,418
	605	1	Progressive Corp., 6.70%, 6/15/37		593,676
	2,200	1,8	Royal Bank of Scotland Group Plc, Ser. MTN,
			7.64% (United Kingdom)		2,280,326
	1,000	1,3,8	Societe Generale, 5.922% (France)		951,690
	675	1	Travelers Cos., Inc., 6.25%, 3/15/67		655,470
	675	1,3	ZFS Finance Trust I, 6.50%, 5/09/37		649,622
			Total Trust Preferred Stocks		12,108,666

Shares
Common Stocks—0.0%
	1,895	9,10	Critical Care Systems Intl., Inc.	11,826
Preferred Stocks—0.4%
	55,000		Deutsche Bank Contingent Capital Trust II, 6.55%	1,317,250
	45,000	10	Superior Essex Holding Corp., Ser. A, 9.50%	27,900
			Total Preferred Stocks	1,345,150
			Total Long-Term Investments (cost $586,479,015)	584,484,025

	Principal Amount (000)		Description	Value
BORROWED BOND AGREEMENTS—21.8%
			Lehman Brothers Inc.,
$	50,927	12	4.47%, 11/08/07	$	50,927,000
	29,563	12	4.45%, 11/08/07		29,563,000
			Total Borrowed Bond Agreements
			(cost $80,490,000)		80,490,000

Notional Amount (000)
OUTSTANDING OPTIONS PURCHASED—1.0%
	3,880	EUR Put Option, strike price $1.40, expires 1/10/08	16,186
		Interest Rate Swaps,
	6,600	Trust pays 3-month LIBOR, Trust receives 5.39%, expires 3/19/12	267,762
	4,900	Trust pays 3-month LIBOR, Trust receives 5.52%, expires 9/21/36	289,016
	7,600	Trust pays 3-month LIBOR, Trust receives 5.79%, expires 8/16/10	392,551
	7,675	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	471,859
	7,675	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	242,300
	6,600	Trust pays 5.39%, Trust receives 3-month LIBOR, expires 3/19/12	322,872
	11,200	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	480,480
	11,200	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	523,600

See Notes to Financial Statements.
15	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Core Bond Trust (BHK) (concluded)
	(Percentages shown are based on Net Assets)

Notional Amount (000)		Description	Value
OUTSTANDING OPTIONS PURCHASED—(cont’d)
	4,900	Trust pays 5.52%, Trust receives 3-month LIBOR, expires 9/21/36	$	332,459
	7,600	Trust pays 5.79%, Trust receives 3-month LIBOR, expires 8/16/10		204,273
		Total Outstanding Options Purchased (cost $3,247,804)		3,543,358
		Total Investments before borrowed bonds, TBA sale commitments, and outstanding options written (cost $670,216,81911)		668,517,383

Principal Amount (000)
BORROWED BONDS—(21.8)%
			U.S. Treasury Notes,
$	(50,800	)	4.00%, 8/31/09	(50,835,712	)
	(29,600	)	4.125%, 8/31/12	(29,569,927	)
			Total Borrowed Bonds
			(proceeds $80,372,938)	(80,405,639	)
TBA SALE COMMITMENTS—(1.3)%
	(4,400	)	Federal National Mortgage Assoc., 6.00%, 11/13/37	(4,431,627	)
	(200	)	Government National Mortgage Assoc., 5.50%, 11/20/37	(198,750	)
			Total TBA Sale Commitments (proceeds $4,627,832)	(4,630,377	)

Notional Amount (000)
OUTSTANDING OPTIONS WRITTEN—(0.4)%
			Interest Rate Swaps,
	(5,300	)	Trust pays 3-month LIBOR, Trust receives 5.135%, expires 4/21/08		(90,551	)
	(6,600	)	Trust pays 3-month LIBOR, Trust receives 5.148%, expires 3/19/08		(107,646	)
	(4,500	)	Trust pays 3-month LIBOR, Trust receives 5.485%, expires 10/28/19		(132,205	)
	(11,500	)	Trust pays 3-month LIBOR, Trust receives 5.67%, expires 1/04/10		(292,905	)
	(6,600	)	Trust pays 5.115%, Trust receives 3-month LIBOR, expires 3/19/08		(107,316	)
	(5,300	)	Trust pays 5.135%, Trust receives 3-month LIBOR, expires 4/21/08		(90,551	)
	(4,500	)	Trust pays 5.485%, Trust receives 3-month LIBOR, expires 10/28/19		(176,797	)
	(11,500	)	Trust pays 5.67%, Trust receives 3-month LIBOR, expires 1/04/10		(556,370	)
			Total Outstanding Options Written (premium received $2,261,545)		(1,554,341	)
Total Investments net of borrowed bonds, TBA sale commitments and outstanding options written—158.0%					581,927,026
Liabilities in excess of other assets—(58.0)%					(213,591,799	)
Net Assets—100%				$	368,335,227

1	Variable rate security. Rate shown is interest rate as of October 31, 2007.
2	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
3	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 9.9% of its net assets, with a current market value of $36,518,999, in securities restricted as to resale.
4	Security, or a portion thereof, pledged as collateral with a value of $4,615,550 on 134 long Eurodollar futures contracts expiring December 2007 to March 2008, 198 long U.S. Treasury Note futures contracts expiring December 2007, 1,153 long U.S. Treasury Bond futures contracts expiring December 2007, 163 short Eurodollar futures contracts expiring December 2007, 3,130 short U.S. Treasury Note futures contracts expiring December 2007 and 224 short U.S. Treasury Note futures contracts expiring December 2007. The notional value of such contracts on October 31, 2007 was $243,902,499, with an unrealized loss of $519,568.
5	Illiquid security. As of October 31, 2007, the Trust held 0.6% of its net assets, with a current market value of $2,148,367, in these securities.
6	Represents a step up bond; the interest rate shown reflects the effective yield at the time of purchase.
7	Represents an investment in an affiliate.
8	The security is a perpetual bond and has no stated maturity date.
9	Non-income producing security.
10	Security is fair valued.
11	Cost for federal income tax purposes is $671,388,702. The net unrealized depreciation on a tax basis is $2,871,319, consisting of $6,742,797 gross unrealized appreciation and $9,614,116 gross unrealized depreciation.
12	See Note 1 in the Notes to Financial Statements for details of borrowed bond agreements.
For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.

ANNUAL REPORT OCTOBER 31, 2007 16

Portfolio of Investments as of October 31, 2007	BlackRock High Yield Trust (BHY)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
LONG-TERM INVESTMENTS—116.2%
Corporate Bonds—110.2%
Aerospace & Defense—3.0%
			AAR Corp.,
$	330		6.875%, 12/15/07	$	330,000
	350	1	Ser. A2, 8.39%, 5/15/11		353,500
	100	2	Bombardier, Inc., 8.00%, 11/15/14 (Canada)		104,000
	410		DI Finance/DynCorp Intl., Ser. B, 9.50%, 2/15/13		435,625
			DRS Technologies, Inc.,
	40		6.875%, 11/01/13		40,000
	100		7.625%, 2/01/18		102,250
	20		L-3 Communications Corp., 5.875%, 1/15/15		19,500
	40		Sequa Corp., 9.00%, 8/01/09		42,900
	100		TransDigm, Inc., 7.75%, 7/15/14		101,750
			Total Aerospace & Defense		1,529,525
Automotive—5.0%
	85		Accuride Corp., 8.50%, 2/01/15		79,900
	185	2	Allison Transmission, 11.25%, 11/01/15		182,456
	60		Asbury Automotive Group, Inc., 7.625%, 3/15/17		56,100
			AutoNation, Inc.,
	90		7.00%, 4/15/14		87,075
	80	3	7.243%, 4/15/13		78,200
	520		Ford Capital BV, 9.50%, 6/01/10 (Netherlands)		523,900
	125		Ford Motor Co., 8.90%, 1/15/32		110,313
			Goodyear Tire & Rubber Co. (The),
	40		7.857%, 8/15/11		41,400
	156		8.625%, 12/01/11		166,140
	195		Lear Corp., Ser. B, 8.75%, 12/01/16		187,200
	255		Metaldyne Corp., 10.00%, 11/01/13		237,150
	180		Penske Auto Group, Inc., 7.75%, 12/15/16		175,050
	250		Rent-A-Center, Inc., 7.50%, 5/01/10		238,750
	350		Stanadyne Corp., 10.00%, 8/15/14		355,250
			Total Automotive		2,518,884
Basic Materials—11.1%
	185		AK Steel Corp., 7.75%, 6/15/12		188,700
			Abitibi-Consolidated, Inc., (Canada)
	165		6.00%, 6/20/13		121,275
	35		8.85%, 8/01/30		25,900
	205		Alpha Natural Resources LLC/Alpha Natural Resources Capital Corp., 10.00%, 6/01/12		218,325
	140		American Pacific Corp., 9.00%, 2/01/15		143,500
	115		Bowater Finance Corp., 7.95%, 11/15/11 (Canada)		98,613
	130	3	Bowater, Inc., 8.694%, 3/15/10		118,950
	150		CPG Intl. I, Inc., 10.50%, 7/01/13		150,000
	175		Cascades, Inc., 7.25%, 2/15/13 (Canada)		169,750
	120		Catalyst Paper Corp., 7.375%, 3/01/14 (Canada)		87,900
	50		Chemtura Corp., 6.875%, 6/01/16		47,750
	40		Domtar, Inc., 7.125%, 8/15/15 (Canada)		39,600
			Equistar Chemicals LP/Equistar Funding Corp.,
	66		10.125%, 9/01/08		68,145
	57		10.625%, 5/01/11		59,565
			FMG Finance Ltd. (Australia)
	85	2	10.00%, 9/01/13		93,925
	120	2	10.625%, 9/01/16		142,200
			Freeport-McMoRan Copper & Gold, Inc.,
	550		8.375%, 4/01/17		602,250
	180	3	8.394%, 4/01/15		185,850
			Huntsman LLC,
	95		11.50%, 7/15/12		103,312
	365		11.625%, 10/15/10		386,900
	205	2	Ineos Group Holdings Plc, 8.50%, 2/15/16 (United Kingdom)		194,750
	545		Innophos, Inc., 8.875%, 8/15/14		549,087

Principal Amount (000)			Description	Value
Basic Materials—(cont’d)
$	70	2	Key Plastics LLC/Key Plastics Finance Corp.,
			11.75%, 3/15/13	$	59,500
	260		Lyondell Chemical Co., 10.50%, 6/01/13		280,150
	265	2	MacDermid, Inc., 9.50%, 4/15/17		253,075
			NewPage Corp.,
	450		10.00%, 5/01/12		475,875
	210		12.00%, 5/01/13		226,800
	105	3	NOVA Chemicals Corp., 8.484%, 11/15/13 (Canada)		103,163
	125		Russel Metals, Inc., 6.375%, 3/01/14 (Canada)		118,750
			Ryerson, Inc.,
	100	2	12.00%, 11/01/15		102,750
	60	2,3	12.574%, 11/01/14		61,200
	80	2	Steel Dynamics, Inc., 7.375%, 11/01/12		80,000
	85		Terra Capital, Inc., Ser. B, 7.00%, 2/01/17		85,000
			Total Basic Materials		5,642,510
Building & Development—1.9%
	40	3	Ainsworth Lumber Co. Ltd., 8.981%, 10/01/10 (Canada)		30,250
			Goodman Global Holding Co., Inc.,
	160		7.875%, 12/15/12		167,200
	32	3	8.36%, 6/15/12		32,160
	250		K. Hovnanian Enterprises, Inc., 6.25%, 1/15/15		192,500
	100		Masonite Intl. Corp., 11.00%, 4/06/15 (Canada)		84,500
	110		Nortek, Inc., 8.50%, 9/01/14		97,350
	335		North American Energy Partners, Inc.,
			8.75%, 12/01/11 (Canada)		338,350
			Total Building & Development		942,310
Commercial Services—0.7%
	100		FTI Consulting, Inc., 7.75%, 10/01/16		104,500
	145	2	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		141,375
	100	2	U.S. Investigations Services, Inc., 10.50%, 11/01/15		95,250
			Total Commercial Services		341,125
Consumer Products—6.9%
	265	3	Ames True Temper, Inc., 9.243%, 1/15/12		254,400
	20	3	Avis Budget Car Rental LLC/Avis Budget Finance, Inc.,
			8.058%, 5/15/14		19,750
	70	2	Bausch & Lomb, Inc., 9.875%, 11/01/15		72,100
	50	2	Beverages & More, Inc., 9.25%, 3/01/12		51,500
	130		Buffets, Inc., 12.50%, 11/01/14		84,175
			General Nutrition Centers, Inc.,
	280	3	10.009%, 3/15/14		269,500
	250		10.75%, 3/15/15		243,125
	150		Jarden Corp., 7.50%, 5/01/17		142,500
	475		Lazy Days RV Center, Inc., 11.75%, 5/15/12		427,500
			Michaels Stores, Inc.,
	260		10.00%, 11/01/14		261,950
	330		11.375%, 11/01/16		329,175
	20		Neiman-Marcus Group, Inc., 9.00%, 10/15/15		21,100
	265		Pantry, Inc. (The), 7.75%, 2/15/14		258,375
	100		Quiksilver, Inc., 6.875%, 4/15/15		93,250
	120		Reynolds American, Inc., 7.625%, 6/01/16		129,830
			Rite Aid Corp.,
	400		7.50%, 3/01/17		372,000
	80	2	9.375%, 12/15/15		73,800
			Sally Holdings LLC,
	35		9.25%, 11/15/14		35,175
	270		10.50%, 11/15/16		268,650
	110		Yankee Acquisition Corp., Ser. B, 9.75%, 2/15/17		101,750
			Total Consumer Products		3,509,605
Containers & Packaging—3.3%
			Berry Plastics Holding Corp.,
	340		8.875%, 9/15/14		348,500
	100	3	9.569%, 9/15/14		100,250
	85		Crown Americas LLC/Crown Americas Capital Corp.,
			7.75%, 11/15/15		87,550

See Notes to Financial Statements.

17 ANNUAL REPORT OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock High Yield Trust (BHY) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Containers & Packaging—(cont’d)
$	110		Graham Packaging Co., Inc., 8.50%, 10/15/12	$	109,175
	30		Graphic Packaging Intl. Corp., 9.50%, 8/15/13		31,500
	270	2,3	Impress Holdings BV, 8.368%, 9/15/13 (Netherlands)		268,584
	310		Pregis Corp., 12.375%, 10/15/13		337,900
	375		Smurfit-Stone Container Enterprises, Inc.,
			8.00%, 3/15/17		372,656
			Total Containers & Packaging		1,656,115
Ecological Services & Equipment—0.8%
	270		Aleris Intl., Inc., 9.00%, 12/15/14		243,675
	185		Waste Services, Inc., 9.50%, 4/15/14		185,000
			Total Ecological Services & Equipment		428,675
Energy—15.9%
	130		AES Red Oak LLC, Ser. A, 8.54%, 11/30/19		139,162
	80		Berry Petroleum Co., 8.25%, 11/01/16		81,600
	100		Chaparral Energy, Inc., 8.50%, 12/01/15		93,250
			Chesapeake Energy Corp.,
	90		6.375%, 6/15/15		87,300
	250		6.625%, 1/15/16		245,000
	20		6.875%, 11/15/20		19,550
			Compagnie Generale de Geophysique-Veritas (France)
	50		7.50%, 5/15/15		51,000
	80		7.75%, 5/15/17		82,400
	115		Compton Petroleum Finance Corp.,
			7.625%, 12/01/13 (Canada)		110,113
	70		Copano Energy LLC, 8.125%, 3/01/16		71,925
	407	2,3	Corral Finans AB, 6.855%, 4/15/10 (Sweden)		384,865
	30		Denbury Resources, Inc., 7.50%, 12/15/15		30,450
	260	1	East Cameron Gas Co., 11.25%, 7/09/19 (Cayman Islands)		249,600
	480		Elwood Energy LLC, 8.159%, 7/05/26		492,337
			Encore Acquisition Co.,
	40		6.00%, 7/15/15		36,200
	30		7.25%, 12/01/17		28,725
	475	2	Energy Future Holdings, 11.25%, 11/01/17		480,937
	370		Exco Resources, Inc., 7.25%, 1/15/11		365,375
	190	2	Forest Oil Corp., 7.25%, 6/15/19		190,000
	65		Frontier Oil Corp., 6.625%, 10/01/11		64,675
	50		Grant Prideco, Inc., Ser. B, 6.125%, 8/15/15		50,250
	97		Homer City Funding LLC, 8.734%, 10/01/26		107,670
	5		Hornbeck Offshore Services, Inc., 6.125%, 12/01/14		4,763
	440		KCS Energy, Inc., 7.125%, 4/01/12		433,400
	96		Midwest Generation LLC, Ser. B, 8.56%, 1/02/16		103,203
	350		Mirant Americas Generation LLC, 8.30%, 5/01/11		353,937
	30		Newfield Exploration Co., 6.625%, 9/01/14		29,475
			NRG Energy, Inc.,
	130		7.25%, 2/01/14		130,000
	385		7.375%, 2/01/16		384,037
	440	2	OPTI, Inc., 8.25%, 12/15/14 (Canada)		441,100
	345		Orion Power Holdings, Inc., 12.00%, 5/01/10		381,225
	185		Range Resources Corp., 7.375%, 7/15/13		188,237
	130		Sabine Pass LNG LP, 7.50%, 11/30/16		127,400
	210	2	SemGroup LP, 8.75%, 11/15/15		201,600
	40		Sithe Independence Funding, Ser. A, 9.00%, 12/30/13		42,349
	200	2	Targa Resources, Inc., 8.50%, 11/01/13		202,000
	160		Tennessee Gas Pipeline Co., 8.375%, 6/15/32		186,512
	450	2	Texas Competitive Electric Holdings Co. LLC,
			10.25%, 11/01/15		452,250
	400		Transcontinental Gas Pipe Line Corp., Ser. B,
			8.875%, 7/15/12		449,000
	495		Whiting Petroleum Corp., 7.25%, 5/01/12-5/01/13		486,963
			Total Energy		8,059,835

Principal Amount (000)			Description	Value
Entertainment & Leisure—4.8%
$	150		AMC Entertainment, Inc., 11.00%, 2/01/16	$	162,375
	125	2	French Lick Resorts & Casino LLC/French Lick Resorts & Casino Corp., 10.75%, 4/15/14		99,375
			Gaylord Entertainment Co.,
	280		6.75%, 11/15/14		271,600
	40		8.00%, 11/15/13		40,700
	320	2	Great Canadian Gaming Corp., 7.25%, 2/15/15 (Canada)		318,400
	185	2	Greektown Holdings LLC, 10.75%, 12/01/13		184,075
	210		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		154,875
	60		MGM Mirage, 6.75%, 9/01/12		59,100
	200	2	Pinnacle Entertainment, Inc., 7.50%, 6/15/15		193,000
	115		Riddell Bell Holdings, Inc., 8.375%, 10/01/12		110,400
	140		Seneca Gaming Corp., Ser. B, 7.25%, 5/01/12		141,050
	140	2	Shingle Springs Tribal Gaming Authority, 9.375%, 6/15/15		140,700
	50		Station Casinos, Inc., 6.625%, 3/15/18		39,625
	60	3	Travelport LLC, 10.246%, 9/01/14		60,300
	435		Virgin River Casino, 9.00%, 1/15/12		411,075
	70		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp.,
			6.625%, 12/01/14		68,775
			Total Entertainment & Leisure		2,455,425
Financial Institutions—10.6%
	500		AES Red Oak LLC, Ser. B, 9.20%, 11/30/29		568,750
	300	2	Alliant Holdings I, Inc., 11.00%, 5/01/15		288,750
			American Real Estate Partners LP/American Real Estate
			Finance Corp.,
	185		7.125%, 2/15/13		180,375
	300		8.125%, 6/01/12		302,250
	112	2,3	BMS Holdings, Inc., 12.40%, 2/15/12		107,084
	500	2	Dow Jones CDX HY, Ser. 6-T1, 8.625%, 6/29/11		528,050
			Ford Motor Credit Co. LLC,
	500		7.80%, 6/01/12		469,787
	110	3	7.993%, 1/13/12		101,835
	40		General Motors Acceptance Corp. LLC, 8.00%, 11/01/31		36,973
			Hexion U.S. Finance Corp./Hexion Nova Scotia Finance ULC,
	75		9.75%, 11/15/14		82,312
	100	3	10.058%, 11/15/14		103,500
	442	2	iPayment Investors LP, 11.625%, 7/15/14		455,155
	120		iPayment, Inc., 9.75%, 5/15/14		115,200
			LVB Acquisition Merger Sub, Inc.,
	75	2	10.00%, 10/15/17		77,063
	75	2	10.375%, 10/15/17		75,938
	100	2	11.625%, 10/15/17		101,875
			Momentive Performance Materials, Inc.,
	175	2	9.75%, 12/01/14		170,625
	40	2	10.125%, 12/01/14		38,600
	285	2	11.50%, 12/01/16		275,025
	70	2	NSG Holdings LLC/NSG Holdings, Inc., 7.75%, 12/15/25		69,300
	220	2,3	PNA Intermediate Holding Corp., 12.36%, 2/15/13		216,150
			Rainbow National Services LLC,
	310	2	8.75%, 9/01/12		322,400
	318	2	10.375%, 9/01/14		349,800
	100	2,3	USI Holdings Corp., 9.433%, 11/15/14		93,000
	30	3	Universal City Florida Holding Co. I/II, 9.661%, 5/01/10		30,675
	300	2	Wimar Opco LLC/Wimar Opco Finance Corp.,
			9.625%, 12/15/14		225,000
			Total Financial Institutions		5,385,472
Health Care—3.7%
	165		Accellent, Inc., 10.50%, 12/01/13		155,512
	180	3	Angiotech Pharmaceuticals, Inc.,
			9.371%, 12/01/13 (Canada)		178,200
	140	2	Community Health Systems, Inc., 8.875%, 7/15/15		141,750
	100		Cooper Cos., Inc. (The), 7.125%, 2/15/15		99,000
	135		Norcross Safety Products LLC/Norcross Capital Corp.,
			9.875%, 8/15/11		140,063
	150	2	PTS Acquisition Corp., 9.50%, 4/15/15		144,750

See Notes to Financial Statements.

ANNUAL REPORT OCTOBER 31, 2007 18

Portfolio of Investments as of October 31, 2007	BlackRock High Yield Trust (BHY) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Health Care—(cont’d)
			Tenet Healthcare Corp.,
$	615		6.50%, 6/01/12	$	521,212
	50		9.875%, 7/01/14		45,500
	230		United Surgical Partners Intl., Inc., 8.875%, 5/01/17		234,600
			Universal Hospital Services, Inc.,
	50	2	8.50%, 6/01/15		50,875
	50	2,3	8.759%, 6/01/15		50,125
	115	2	Viant Holdings, Inc., 10.125%, 7/15/17		108,100
			Total Health Care		1,869,687
Industrials—3.9%
	200	2	AGY Holding Corp., 11.00%, 11/15/14		197,000
	30	2	Blaze Recycling & Metals LLC/Blaze Finance Corp.,
			10.875%, 7/15/12		30,000
			Harland Clarke Holdings Corp.,
	60		9.50%, 5/15/15		54,600
	50	3	10.308%, 5/15/15		45,000
	80		Hexcel Corp., 6.75%, 2/01/15		78,600
	200		Leucadia National Corp., 8.125%, 9/15/15		201,750
	85		Park-Ohio Industries, Inc., 8.375%, 11/15/14		79,263
			RBS Global, Inc./Rexnord Corp.,
	85		8.875%, 9/01/16		86,062
	340		9.50%, 8/01/14		351,050
	280		11.75%, 8/01/16		296,800
	510	2	Sunstate Equipment Co. LLC, 10.50%, 4/01/13		489,600
	55		Terex Corp., 7.375%, 1/15/14		55,275
			Total Industrials		1,965,000
Media—12.1%
			Affinion Group, Inc.,
	215		10.125%, 10/15/13		224,137
	175		11.50%, 10/15/15		182,437
	35		American Media Operations, Inc., Ser. B, 10.25%, 5/01/09		33,513
	80	2	Bonten Media Acquisition Co., 9.00%, 6/01/15		73,500
	290		CMP Susquehanna Corp., 9.875%, 5/15/14		266,437
	45		CSC Holdings, Inc., Ser. B, 7.625%, 4/01/11		44,888
	175	3	Cablevision Systems Corp., Ser. B, 9.644%, 4/01/09		179,812
	60		CanWest MediaWorks, Inc., 8.00%, 9/15/12 (Canada)		58,500
	270		Charter Communications Holdings I LLC/Charter
			Communications Holdings I Capital Corp.,
			11.00%, 10/01/15		261,575
			Charter Communications Holdings II LLC/Charter
			Communications Holdings II Capital Corp.,
	810		10.25%, 9/15/10		826,200
	75		Ser. B, 10.25%, 9/15/10		76,313
	50		Dex Media West LLC/Dex Media Finance Co., Ser. B,
			9.875%, 8/15/13		53,313
	125		DirecTV Holdings LLC/DirecTV Financing Co.,
			8.375%, 3/15/13		130,625
			EchoStar DBS Corp.,
	200		7.00%, 10/01/13		208,250
	260		7.125%, 2/01/16		271,700
	125	2,3	ION Media Networks, Inc., 8.493%, 1/15/12		125,313
	320		Idearc, Inc., 8.00%, 11/15/16		320,800
	290		Network Communications, Inc., 10.75%, 12/01/13		291,812
	325		Nexstar Finance, Inc., 7.00%, 1/15/14		312,000
			Nielsen Finance LLC/Nielsen Finance Co.,
	170	4	9.115%, 8/01/16		122,825
	445		10.00%, 8/01/14		468,362
	35	2	Quebecor Media, Inc., 7.75%, 3/15/16 (Canada)		33,775
			RH Donnelley Corp.,
	100	2	8.875%, 10/15/17		100,000
	275		Ser. A-3, 8.875%, 1/15/16		275,000
	590	2	TL Acquisitions, Inc., 10.50%, 1/15/15		587,050
	180	2	Univision Communications, Inc., 9.75%, 3/15/15		176,400
	280		Vertis, Inc., 9.75%, 4/01/09		280,000
	175		Young Broadcasting, Inc., 10.00%, 3/01/11		164,500
			Total Media		6,149,037

Principal Amount (000)			Description	Value
Real Estate—1.4%
			Realogy Corp.,
$	240	2	10.50%, 4/15/14	$	199,500
	380	2	11.00%, 4/15/14		309,700
	265	2	12.375%, 4/15/15		193,450
			Total Real Estate		702,650
Technology—6.3%
			Amkor Technology, Inc.,
	40		7.75%, 5/15/13		38,700
	235		9.25%, 6/01/16		240,288
	60		Belden, Inc., 7.00%, 3/15/17		60,900
	350		Celestica, Inc., 7.625%, 7/01/13 (Canada)		336,000
	180		Coleman Cable, Inc., 9.875%, 10/01/12		177,300
	430	2	First Data Corp., 9.875%, 9/24/15		411,725
	530		Freescale Semiconductor, Inc., 9.125%, 12/15/14		479,650
			NXP BV/NXP Funding LLC (Netherlands)
	125	3	7.993%, 10/15/13		118,438
	150		9.50%, 10/15/15		141,750
	190		Sanmina-SCI Corp., 8.125%, 3/01/16		166,725
	190	2,3	Spansion, Inc., 8.746%, 6/01/13		180,025
			SunGard Data Systems, Inc.,
	85		9.125%, 8/15/13		86,700
	465		10.25%, 8/15/15		484,762
	305		Superior Essex Communications LLC/Essex Group, Inc.,
			9.00%, 4/15/12		301,187
			Total Technology		3,224,150
Telecommunications—16.6%
	2,000	5	Asia Global Crossing Ltd., 13.375%, 10/15/10 (Bermuda)		180,000
			Centennial Communications Corp.,
	455		8.125%, 2/01/14		464,100
	220	3	10.981%, 1/01/13		226,600
	405		Cincinnati Bell, Inc., 7.25%, 7/15/13		406,012
			Cricket Communications, Inc.,
	115		9.375%, 11/01/14		114,138
	230	2	9.375%, 11/01/14		228,275
			Digicel Group Ltd. (Bermuda)
	130	2	8.875%, 1/15/15		121,394
	394	2	9.125%, 1/15/15		368,276
	260		Dobson Cellular Systems, Inc., 8.375%, 11/01/11		275,600
	100	3	Hawaiian Telcom Communications, Inc., Ser. B,
			10.318%, 5/01/13		101,250
	90	3	iPCS, Inc., 7.036%, 5/01/13		87,750
	320		Intelsat Corp., 9.00%, 6/15/16		327,200
	40		Intelsat Intermediate Holding Co. Ltd.,
			9.25%, 2/01/15 (Bermuda)		32,900
			Intelsat Ltd. (Bermuda)
	295	3	8.886%, 1/15/15		299,425
	150		9.25%, 6/15/16		155,625
	70		11.25%, 6/15/16		75,250
	320	3	11.409%, 6/15/13		333,600
	245		Intelsat Subsidiary Holding Co. Ltd.,
			8.625%, 1/15/15 (Bermuda)		248,675
	565	2	MetroPCS Wireless, Inc., 9.25%, 11/01/14		560,763
	445	2	Nordic Telephone Co. Holdings A.p.S.,
			8.875%, 5/01/16 (Denmark)		470,587
	245	2,3	Nortel Networks Ltd., 9.493%, 7/15/11 (Canada)		241,938
			PanAmSat Corp.,
	210		6.875%, 1/15/28		177,450
	270		9.00%, 8/15/14		275,400
	394	2,3	ProtoStar I Ltd., 12.50%, 10/15/12 (Bermuda)		413,758
			Qwest Corp.,
	600		7.875%, 9/01/11		633,000
	230	3	8.944%, 6/15/13		245,237
			West Corp.,
	125		9.50%, 10/15/14		128,438
	475		11.00%, 10/15/16		497,562

See Notes to Financial Statements.

19 ANNUAL REPORT OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock High Yield Trust (BHY) (concluded)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Telecommunications—(cont’d)
$	375	2	Wind Acquisition Finance S.A., 10.75%,
			12/01/15 (Luxembourg)	$	417,187
			Windstream Corp.,
	200		8.125%, 8/01/13		211,500
	120		8.625%, 8/01/16		128,400
			Total Telecommunications		8,447,290
Transportation—2.2%
	95		American Airlines, Inc., Ser. 99-1, 7.324%, 4/15/11		93,813
	60		Britannia Bulk Plc, 11.00%, 12/01/11 (United Kingdom)		63,000
	170		CHC Helicopter Corp., 7.375%, 5/01/14 (Canada)		164,475
	320		Navios Maritime Holdings, Inc., 9.50%, 12/15/14 (Marshall Islands)		338,400
	350		Overseas Shipholding Group, Inc., 7.50%, 2/15/24		342,125
	200	2	St. Acquisition Corp., 12.50%, 5/15/17		127,500
			Total Transportation		1,129,313
			Total Corporate Bonds		55,956,608
Bank Loans—5.2%
	325		Affinion Group, Inc., LIBOR + 6.25%, 3/01/12		315,792
	50		Rexnord Holdings, Inc., LIBOR + 6.25%, 3/02/13		46,814
	50		Riverdeep Interactive Learning USA, Inc., LIBOR + 7.20%, 12/19/14		49,337
	252		Rotech Healthcare, LIBOR + 6.00%, 9/26/11		244,105
	430		ServiceMaster Co. (The), LIBOR + 4.50%, 6/19/08		397,212
	85		Spectrum Brands, Inc., LIBOR + 4.00% , 4/15/13		83,741
	750		Texas Competitive Electric Holdings Co. LLC, LIBOR + 3.50%, 10/10/14		749,785
	394		Travelport Holdco, LIBOR + 7.00%, 3/22/12		379,314
	400		Verso Paper Finance Holdings LLC, LIBOR + 6.25%, 2/01/13		389,000
			Total Bank Loans		2,655,100

Shares
Common Stocks—0.8%
	4,737	1,6	Critical Care Systems Intl., Inc.	29,606
	14,992	1,6	Mattress Discounters Corp.	—
	68,358	6	Neon Communications Group, Inc.	352,044
			Total Common Stocks	381,650
Preferred Stock—0.0%
	40,000	1	Superior Essex Holding Corp., Ser. A, 9.50%	24,800

Units (000)
Warrants—0.0%
	54	1,2,7	Neon Communications, Inc., expires 12/02/12	1
	—	1,2,6,7	PF. Net Communications, Inc., expires 5/15/10,
			strike price $0.01, 36.87243 shares for 1 warrant	—
			Total Warrants	1
			Total Long-Term Investments
			(cost $62,270,501)	59,018,159

Principal Amount (000)			Description	Value
SHORT-TERM INVESTMENT—1.2%
U.S. Government and Agency Discount Notes—1.2%
$	600	8	Federal Home Loan Bank Disc. Notes,
			4.401%, 11/01/07 (cost $600,000)	$	600,000
Total Investments—117.4% (cost $62,870,5019)					59,618,159
Liabilities in excess of other assets—(17.4)%					(8,835,903	)
Net Assets—100%				$	50,782,256

1	Security is fair valued.
2	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 30.1% of its net assets, with a current market value of $15,307,398, in securities restricted as to resale.
3	Variable rate security. Rate shown is interest rate as of October 31, 2007.
4	Represents a step up bond; the interest rate shown reflects the effective yield at the time of purchase.
5	Issuer is in default and/or bankruptcy.
6	Non-income producing security.
7	Illiquid security. As of October 31, 2007, the Trust held less than 0.1% of its net assets, with a current market value of $1, in these securities.
8	Rate shown is the yield to maturity as of the date of purchase.
9	Cost for federal income tax purposes is $62,884,976. The net unrealized depreciation on a tax basis is $3,266,817, consisting of $1,051,387 gross unrealized appreciation and $4,318,204 gross unrealized depreciation.

For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.

ANNUAL REPORT OCTOBER 31, 2007 20

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description		Value
LONG-TERM INVESTMENTS—167.7%
Mortgage Pass-Through Securities—60.2%
$	5,047	1	Citigroup Mortgage Loan Trust, Inc., Ser. 4, Class A, 5.345%, 8/25/35	$	4,923,530
			Federal Home Loan Mortgage Corp.,
	651	1	4.207%, 1/01/35		661,712
	1,455	1,2	5.067%, 1/01/35		1,436,926
	4,000		TBA, 5.50%, 12/12/37		3,935,000
			Federal National Mortgage Assoc.,
	498		5.00%, 1/01/37-4/01/37		477,395
	13,179	2	5.00%, 7/01/35		12,661,887
	13,497		5.50%, 12/01/13-5/18/35		13,465,940
	335	3	5.50%, 12/01/32		331,440
	6,848	2,3	5.50%, 1/01/33		6,769,130
	14,910	2	5.50%, 7/01/16-6/01/36		14,806,796
	747		6.00%, 3/01/16-1/01/37		760,348
	897	2	6.00%, 6/01/37		903,619
	89		7.00%, 2/01/24-8/01/36		92,148
	115,700		TBA, 5.50%, 12/01/99		114,000,598
	30,300		TBA, 6.00%, 11/13/37-12/12/37		30,491,251
	17,400		TBA, 6.50%, 12/12/37		17,786,071
	97		Government National Mortgage Assoc., 8.00%, 4/15/24-6/15/25		103,077
	5,168	1	GSR Mortgage Loan Trust, Ser. AR4, Class 6A1, 5.25%, 7/25/35		5,025,408
			Total Mortgage Pass-Through Securities		228,632,276
Federal Housing Administration Securities—1.0%
			General Motors Acceptance Corp. Projects,
	190		Ser. 37, 7.43%, 5/01/22		191,819
	77		Ser. 44, 7.43%, 8/01/22		77,296
			Merrill Projects,
	50	4	Ser. 29, 7.43%, 10/01/20		50,662
	49	4	Ser. 42, 7.43%, 9/01/22		49,745
	1,715		Reilly Project, Ser. B-11, 7.40%, 4/01/21		1,732,569
	1,710		Westmore Project, 7.25%, 4/01/21		1,726,757
			Total Federal Housing Administration Securities		3,828,848
Agency Multiple Class Mortgage Pass-Through Securities—6.5%
			Federal Home Loan Mortgage Corp.,
	—	1	Ser. 192, Class U, 1,009.033%, 2/15/22		4
	—		Ser. 1057, Class J, 1,008.001%, 3/15/21		740
	3,156		Ser. 2806, Class VC, 6.00%, 12/15/19		3,208,113
	6,000		Ser. 2874, Class BC, 5.00%, 10/15/19		5,832,895
	1,390		Ser. 2883, Class DR, 5.00%, 11/15/19		1,344,446
	1,725		Ser. 2968, Class EG, 6.00%, 10/15/34		1,749,053
	7,182		Ser. 3174, Class PZ, 5.00%, 1/15/36		6,420,018
			Federal National Mortgage Assoc.,
	2,858		Ser. 5, Class PK, 5.00%, 12/25/34		2,850,583
	—		Ser. 33, Class PV, 1,078.42%, 10/25/21		9,533
	1,571	1	Ser. 118, Class FD, 5.273%, 12/25/33		1,559,544
	1,525		Government National Mortgage Assoc., Ser. 65, Class VA, 6.00%, 6/20/15		1,554,302
			Total Agency Multiple Class Mortgage Pass-Through Securities		24,529,231
Non-Agency Multiple Class Mortgage Pass-Through Securities—7.5%
	1,700		Countrywide Alternative Loan Trust, Ser. 64CB, Class 1A15, 5.50%, 12/25/35		1,598,490
	3,025	1	CW Capital Cobalt Ltd., Ser. C3, Class A4, 5.82%, 5/15/46		3,108,306
	2,369		Donaldson, Lufkin & Jenrette Commercial Mortgage Corp., Class A 1B, 7.18%, 11/10/33		2,478,743
	2,630		First Union-Lehman Brothers-Bank of America, Ser. C2, Class D, 6.778%, 11/18/35		2,786,483

Principal Amount (000)			Description	Value
Non-Agency Multiple Class Mortgage Pass-Through Securities—(cont’d)
$	2,310		GE Capital Commercial Mortgage Corp., Ser. 1A, Class A3, 6.269%, 12/10/35	$	2,394,614
	2,580		General Motor Acceptance Corp. Commercial Mortgage Securities, Inc., Ser. C4, Class A2, 4.93%, 7/10/39		2,534,713
	1,065		JPMorgan Chase Commercial Mortgage Securities Corp., Ser. LDP9, Class A3, 5.336%, 5/15/47		1,039,030
	2,500	1	LB-UBS Commercial Mortgage Trust, Ser. C6, Class A4, 5.858%, 7/20/40		2,532,404
	1,105	1	Morgan Stanley Capital I, Ser. T27, Class A4, 5.651%, 6/11/42		1,110,211
	7,077		Residential Funding Securities Corp., Ser. RM2, Class AI5, 8.50%, 5/25/33		7,557,206
	2	1,5,6	Summit Mortgage Trust, Ser. 1, Class B1, 6.611%, 12/28/12		2,055
	1,105	1	Wachovia Bank Commercial Mortgage Trust, Ser. C33, Class A4, 5.903%, 2/15/51		1,130,221
	300	1	Wells Fargo Mortgage Backed Securities Trust, Ser. AR4, Class 2A4, 5.774%, 4/25/36		292,254
			Total Non-Agency Multiple Class Mortgage Pass-Through Securities		28,564,730
Inverse Floating Rate Mortgage Securities—0.4%
			Federal Home Loan Mortgage Corp.,
	7	1	Ser. 1043, Class H, 21.938%, 2/15/21		6,728
	—	1	Ser. 1148, Class E, 592.552%, 10/15/21		254
	401	1	Ser. 1611, Class JC, 10.00%, 8/15/23		415,923
			Federal National Mortgage Assoc.,
	—	1	Ser. 7, Class S, 594.704%, 3/25/21		3,020
	—	1	Ser. 10, Class S, 575.455%, 5/25/21		9,122
	—	1	Ser. 12, Class S, 608.135%, 5/25/21		7,929
	—	1	Ser. 17, Class S, 580.114%, 6/25/21		4,623
	970	1	Ser. 23, Class PS, 9.565%, 4/25/23		997,875
	—	1	Ser. 46, Class S, 1,402.625%, 5/25/21		3,397
	—	1	Ser. 49, Class S, 527.80%, 12/25/21		1,620
	54	1	Ser. 87, Class S, 13.764%, 8/25/21		66,182
			Total Inverse Floating Rate Mortgage Securities		1,516,673
Asset-Backed Securities—11.6%
	1,171	1	Ameriquest Mortgage Securities, Inc., Ser. R11, Class A1, 5.175%, 11/25/34		1,130,435
	3,025		Capital Auto Receivables Asset Trust, Ser. 1, Class A3, 5.03%, 10/15/09		3,023,858
			Chase Issuance Trust,
	2,600		Ser. A17, Class A, 5.12%, 10/15/14		2,617,368
	2,650	1	Ser. A3, 5.081%, 7/15/11		2,642,849
	3,100		Chase Manhattan Auto Owner Trust, Ser. B, Class A4, 4.88%, 6/15/12		3,101,824
	3,125		Citibank Credit Card Issuance Trust, Ser. A2, Class A2, 4.85%, 2/10/11		3,126,616
	251	1	Countrywide Asset-Backed Certificates, Ser. 16, Class 4AV1, 4.973%, 1/25/35		250,395
	2,683		DaimlerChrysler Auto Trust, Ser. A, Class A3, 5.00%, 5/08/10		2,682,987
	2,575	1	Discover Card Master Trust I, Ser. 1, Class A, 5.101%, 9/16/10		2,573,534
	2,829		Ford Credit Auto Owner Trust, Ser. A, Class A3, 5.07%, 11/15/09		2,828,664
	2,550		Harley-Davidson Motorcycle Trust, Ser. 2, Class A2, 4.07%, 2/15/12		2,532,184
	2,500		Maryland Trust, Ser. 1, Class A, 5.55%, 12/10/65		2,371,875
			MBNA Credit Card Master Note Trust,
	3,075		Ser. A1, Class A, 4.90%, 7/15/11		3,080,667
	4,050	1	Ser. A4, 5.081%, 9/15/11		4,039,664
			Morgan Stanley ABS Capital I,
	1,483	1	Ser. HE5, Class A2A, 4.943%, 8/25/36		1,470,690
	1,094	1	Ser. NC4, Class A2A, 4.903%, 6/25/36		1,088,057

See Notes to Financial Statements.

21 ANNUAL REPORT OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Asset-Backed Securities—(cont’d)
$	65	1	New Century Home Equity Loan Trust, Ser. C, Class A2A, 4.953%, 1/25/36	$	64,997
	520	1	Structured Asset Investment Loan Trust, Ser. 1, Class A1, 4.953%, 1/25/36		518,334
	2,517		USAA Auto Owner Trust, Ser. 1, Class A3, 5.01%, 9/15/10		2,517,258
	2,275		Wachovia Auto Owner Trust, Ser. A, Class A4, 5.38%, 3/20/13		2,300,691
			Total Asset-Backed Securities		43,962,947
Interest Only Asset-Backed Securities— 0.2%
	24	1,5	Morgan Stanley Capital Trust I, Ser. HF1, Class X, 2.25%, 6/15/17		1
			Sterling Coofs Trust,
	12,656		Ser. 1, 2.365%, 4/15/29		561,620
	10,991	5	Ser. 2, 2.081%, 3/30/30		295,381
			Total Interest Only Asset-Backed Securities		857,002
Interest Only Mortgage-Backed Securities—1.0%
			Federal Home Loan Mortgage Corp.,
	—		Ser. 176, Class M, 1,010.00%, 7/15/21		32
	—	6	Ser. 200, Class R, 93,522.906%, 12/15/22		139
	—	1	Ser. 1054, Class I, 435.32%, 3/15/21		84
	—		Ser. 1056, Class KD, 1,084.50%, 3/15/21		557
	—		Ser. 1179, Class O, 1,009.389%, 11/15/21		38
	150		Ser. 1254, Class Z, 8.50%, 4/15/22		7
	214		Ser. 1831, Class PG, 6.50%, 3/15/11		14,123
	5,772		Ser. 2611, Class QI, 5.50%, 9/15/32		1,047,320
			Federal National Mortgage Assoc.,
	78		Ser. 5, Class H, 9.00%, 1/25/22		17,839
	5		Ser. 7, Class 2, 8.50%, 4/01/17		994
	—		Ser. 38, Class N, 1,008.50%, 4/25/21		204
	2		Ser. 46, Class H, 1,042.50%, 12/25/09		15,158
	3371		Ser. 50, Class SI, 1.20%, 4/25/23		10,500
	10		Ser. 89, Class 2, 8.00%, 6/01/18		1,821
	23,975	1	Ser. 90, Class JH, 1.828%, 11/25/34		1,341,116
	3		Ser. 94, Class 2, 9.50%, 8/01/21		768
	—		Ser. 99, Class L, 930.00%, 8/25/21		2,800
	—		Ser. 123, Class M, 1,009.50%, 10/25/20		530
	12	1	Ser. 136, Class S, 15.214%, 11/25/20		15,118
	—		Ser. 139, Class PT, 648.35%, 10/25/21		3,532
	4,383		Ser. 378, Class 19, 5.00%, 6/01/35		1,146,190
	3,941	1,5	Goldman Sachs Mortgage Securities Corp., Ser. 5, 0.97%, 2/19/25		77,590
	1,176	1	Salomon Brothers Mortgage Securities VII, Ser. 1, 0.492%, 3/25/22		116
			Total Interest Only Mortgage-Backed Securities		3,696,576
Principal Only Mortgage-Backed Securities—0.1%
	82	7	Federal Home Loan Mortgage Corp., Ser. 1739, Class B, 7.50%, 2/15/24		76,238
			Federal National Mortgage Assoc.,
	67	7	Ser. 51, Class E, 8.00%, 2/25/23		57,780
	11	7	Ser. 70, Class A, 7.00%, 5/25/23		9,646
	22	7	Ser. 167, Class D, 8.50%, 10/25/17		20,996
	20	7	Ser. 203, Class 1, 8.00%, 2/01/23		16,792
	14	7	Ser. 228, Class 1, 7.00%, 5/01/23		11,294
			Total Principal Only Mortgage-Backed Securities		192,746
Commercial Mortgage-Backed Securities—5.0%
	2,320		Bear Stearns Commercial Mortgage Services, Ser. PWR7, Class A2, 4.945%, 2/11/41		2,287,635
	2,970		Credit Suisse First Boston Mortgage Securities Corp., Ser. CP5, Class A2, 4.94%, 12/15/35		2,912,454
	2,400	1	Credit Suisse Mortgage Capital Certificates, Ser. C2, Class A3, 5.542%, 1/15/49		2,374,889

Principal Amount (000)			Description	Value
Commercial Mortgage-Backed Securities—(cont’d)
$	2,067		First Union National Bank Commercial Mortgage Trust, Ser. C2, Class A2, 7.202%, 10/15/32	$	2,165,673
	2,475		General Motors Acceptance Corp. Commercial Mortgage Securities, Inc., Ser. C3, Class A4, 4.547%, 12/10/41		2,412,505
			JPMorgan Chase Commercial Mortgage Securities Corp.,
	1,990		Ser. C1, Class A3, 5.857%, 10/12/35		2,032,092
	2,380		Ser. CBX, Class A4, 4.529%, 1/12/37		2,327,152
	2,530	1	Lehman Brothers-UBS Commercial Mortgage Trust, Ser. C4, Class A3, 4.972%, 6/15/29		2,538,263
			Total Commercial Mortgage-Backed Securities		19,050,663
Collateralized Mortgage Obligation Residual Securities—0.0%
			Collateralized Mortgage Obligation Trust,
	—	6	Ser. 40, Class R, 580.50%, 4/01/18		156
	—	6	Ser. 42, Class R, 6,000.00%, 10/01/14		1,602
			Federal Home Loan Mortgage Corp.,
	—	6	Ser. 19, Class R, 9,427.22%, 3/15/20		1,373
	—	6	Ser. 75, Class R, 9.50%, 1/15/21		2
	—	6	Ser. 75, Class RS, 12.479%, 1/15/21		2
	—	6	Ser. 173, Class R, 9.00%, 11/15/21		10
	—	6	Ser. 173, Class RS, 9.029%, 11/15/21		11
	6	6,8	Painewebber CMO Trust, Ser. 88 M, Class 6, 13.80%, 9/01/18		—
			Total Collateralized Mortgage Obligation Residual Securities		3,156
Corporate Bonds—64.0%
Aerospace & Defense—0.8%
	170	5	Bombardier, Inc., 8.00%, 11/15/14 (Canada)		176,800
	1,363		DI Finance/DynCorp Intl., Ser. B, 9.50%, 2/15/13		1,448,187
			DRS Technologies, Inc.,
	80		6.875%, 11/01/13		80,000
	80		7.625%, 2/01/18		81,800
	15		Sequa Corp., 9.00%, 8/01/09		16,088
	140		TransDigm, Inc., 7.75%, 7/15/14		142,450
	1,250	2	United Technologies Corp., 4.875%, 5/01/15		1,209,314
			Total Aerospace & Defense		3,154,639
Automotive—0.3%
	305		Accuride Corp., 8.50%, 2/01/15		286,700
			AutoNation, Inc.,
	170		7.00%, 4/15/14		164,475
	160	1	7.243%, 4/15/13		156,400
	410		Lear Corp., Ser. B, 8.75%, 12/01/16		393,600
	295		Metaldyne Corp., 10.00%, 11/01/13		274,350
			Total Automotive		1,275,525
Basic Materials—3.2%
	485		Abitibi-Consolidated, Inc., 6.00%, 6/20/13 (Canada)		356,475
	1,115		AK Steel Corp., 7.75%, 6/15/12		1,137,300
	280		American Pacific Corp., 9.00%, 2/01/15		287,000
	90	1	Bowater, Inc., 8.694%, 3/15/10		82,350
	30		Chemtura Corp., 6.875%, 6/01/16		28,650
	230		CPG Intl. I, Inc., 10.50%, 7/01/13		230,000
	80		Domtar, Inc., 7.125%, 8/15/15 (Canada)		79,200
	171		Equistar Chemicals LP/Equistar Funding Corp., 10.625%, 5/01/11		178,695
			Freeport-McMoRan Copper & Gold, Inc.,
	1,275		8.375%, 4/01/17		1,396,125
	360	1	8.394%, 4/01/15		371,700
			Huntsman LLC,
	72		12.00%, 7/15/12		78,300
	230		11.625%, 10/15/10		243,800
	1,500	5	Ineos Group Holdings Plc, 8.50%, 2/15/16 (United Kingdom)		1,425,000
	975		Innophos, Inc., 8.875%, 8/15/14		982,312
	565	5	Key Plastics LLC/Key Plastics Finance Corp., 11.75%, 3/15/13		480,250

See Notes to Financial Statements.

ANNUAL REPORT OCTOBER 31, 2007 22

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Basic Materials—(cont’d)
$	130		Lyondell Chemical Co., 10.50%, 6/01/13	$	140,075
	575		NewPage Corp., 10.00%, 5/01/12		608,063
			Noranda, Inc., (Canada)
	600		6.00%, 10/15/15		604,152
	1,550		6.20%, 6/15/35		1,489,026
	1,570		Teck Cominco Ltd., 6.125%, 10/01/35 (Canada)		1,487,178
	360		Terra Capital, Inc., Ser. B, 7.00%, 2/01/17		360,000
			Total Basic Materials		12,045,651
Building & Development—0.2%
	495		Goodman Global Holding Co., Inc., 7.875%, 12/15/12		517,275
	160		Nortek, Inc., 8.50%, 9/01/14		141,600
	85		North American Energy Partners, Inc., 8.75%, 12/01/11 (Canada)		85,850
			Total Building & Development		744,725
Commercial Services—0.1%
	125		FTI Consulting, Inc., 7.75%, 10/01/16		130,625
	225	5	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		219,375
			Total Commercial Services		350,000
Consumer Products—2.4%
	720	1	Ames True Temper, Inc., 9.243%, 1/15/12		691,200
	30	1	Avis Budget Car Rental LLC/Avis Budget Finance, Inc., 8.058%, 5/15/14		29,625
	850		CVS Caremark Corp., 6.25%, 6/01/27		845,203
	840		Federated Retail Holdings, Inc., 5.90%, 12/01/16		801,941
			General Nutrition Centers, Inc.,
	500	1	10.009%, 3/15/14		481,250
	450		10.75%, 3/15/15		437,625
	975		Kimberly-Clark Corp., 6.625%, 8/01/37		1,073,433
	1,670	2	Kraft Foods, Inc., 7.00%, 8/11/37		1,813,260
	362		Lazy Days RV Center, Inc., 11.75%, 5/15/12		325,800
			Michaels Stores, Inc.,
	530		10.00%, 11/01/14		533,975
	670	2	11.375%, 11/01/16		668,325
	250		Quiksilver, Inc., 6.875%, 4/15/15		233,125
	250		Reynolds American, Inc., 7.625%, 6/01/16		270,479
	860		Rite Aid Corp., 7.50%, 3/01/17		799,800
	190		Sally Holdings LLC, 10.50%, 11/15/16		189,050
			Total Consumer Products		9,194,091
Containers & Packaging—0.8%
			Berry Plastics Holding Corp.,
	290		8.875%, 9/15/14		297,250
	190	1	9.569%, 9/15/14		190,475
	150		Crown Americas LLC/Crown Americas Capital Corp., 7.75%, 11/15/15		154,500
	330	1,5	Impress Holdings BV, 8.368%, 9/15/13 (Netherlands)		328,269
	1,626		Owens-Brockway Glass Container, Inc., 8.875%, 2/15/09		1,638,195
	535		Pregis Corp., 12.375%, 10/15/13		583,150
			Total Containers & Packaging		3,191,839
Ecological Services & Equipment—0.8%
	2,250		Casella Waste Systems, Inc., 9.75%, 2/01/13		2,295,000
	600		Waste Services, Inc., 9.50%, 4/15/14		600,000
			Total Ecological Services & Equipment		2,895,000
Energy—9.7%
	2,625		Anadarko Petroleum Corp., 6.45%, 9/15/36		2,655,783
	160		Berry Petroleum Co., 8.25%, 11/01/16		163,200
	950		Burlington Resources Finance Co., 7.40%, 12/01/31 (Canada)		1,119,546
	500		Canadian Natural Resources Ltd., 6.25%, 3/15/38 (Canada)		494,053
	380		Chaparral Energy, Inc., 8.50%, 12/01/15		354,350

Principal Amount (000)			Description	Value
Energy—(cont’d)
			Chesapeake Energy Corp.,
$	175		6.375%, 6/15/15	$	169,750
	20		6.875%, 11/15/20		19,550
	1,300		Cleveland Electric Illuminating Co., 5.95%, 12/15/36		1,205,706
	550		CMS Energy Corp., 6.55%, 7/17/17		533,873
			Compagnie Generale de Geophysique-Veritas (France)
	60		7.50%, 5/15/15		61,200
	100		7.75%, 5/15/17		103,000
	225		Compton Petroleum Finance Corp., 7.625%, 12/01/13 (Canada)		215,438
	150		Conoco Funding Co., 7.25%, 10/15/31 (Canada)		174,928
	1,970	1,2	ConocoPhillips Australia Funding Co., 5.343%, 4/09/09		1,964,845
	150		ConocoPhillips Funding Co., 5.95%, 10/15/36 (Canada)		153,771
	700		ConocoPhillips Holding Co., 6.95%, 4/15/29		797,096
	125		Devon Energy Corp., 7.95%, 4/15/32		152,890
	450		DTE Energy Co., 6.35%, 6/01/16		465,924
	130		Edison Mission Energy, 7.50%, 6/15/13		131,788
	1,250	5	EDP Finance BV, 6.00%, 2/02/18 (Netherlands)		1,247,215
	150		El Paso Natural Gas Co., 8.875%, 6/15/32		174,855
	182		Elwood Energy LLC, 8.159%, 7/05/26		186,611
			EnCana Corp. (Canada)
	425		6.50%, 8/15/34		444,473
	775		6.625%, 8/15/37		818,530
			Encore Acquisition Co.,
	50		6.00%, 7/15/15		45,250
	60		7.25%, 12/01/17		57,450
	1,675		Energy East Corp., 6.75%, 7/15/36		1,727,154
	435		Exco Resources, Inc., 7.25%, 1/15/11		429,562
	480		FirstEnergy Corp., Ser. B, 6.45%, 11/15/11		495,357
	575		Florida Power & Light Co., 4.95%, 6/01/35		499,059
	675		Florida Power Corp., 6.35%, 9/15/37		708,736
	90		Grant Prideco, Inc., Ser. B, 6.125%, 8/15/15		90,450
	255		KCS Energy, Inc., 7.125%, 4/01/12		251,175
	800		Midamerican Energy Co., 5.80%, 10/15/36		777,262
			Midamerican Energy Holdings Co.,
	950		5.95%, 5/15/37		910,800
	1,725	5	6.50%, 9/15/37		1,769,112
	83		Midwest Generation LLC, Ser. B, 8.56%, 1/02/16		89,741
	175		Mirant Americas Generation LLC, 8.30%, 5/01/11		176,969
	1,100	5	Nakilat, Inc., 6.067%, 12/31/33 (Qatar)		1,043,130
	600		Nexen, Inc., 6.40%, 5/15/37 (Canada)		596,988
			NRG Energy, Inc.,
	50		7.25%, 2/01/14		50,000
	285		7.375%, 2/01/16		284,288
	350		Ohio Edison Co., 6.875%, 7/15/36		366,549
	500		ONEOK Partners LP, 6.65%, 10/01/36		509,155
	490	5	OPTI, Inc., 8.25%, 12/15/14 (Canada)		491,225
	140		Orion Power Holdings, Inc., 12.00%, 5/01/10		154,700
	650		Pacificorp, 6.25%, 10/15/37		667,122
	1,350		Public Service Co. of Colorado, 6.25%, 9/01/37		1,400,680
	350		Sabine Pass LNG LP, 7.50%, 11/30/16		343,000
	175		Scottish Power Plc, 5.375%, 3/15/15 (United Kingdom)		172,442
	350	5	SemGroup LP, 8.75%, 11/15/15		336,000
			Southern California Edison Co.,
	675		5.625%, 2/01/36		644,392
	150		Ser. 05-E, 5.35%, 7/15/35		136,746
	400		Suncor Energy, Inc., 6.50%, 6/15/38 (Canada)		418,711
	360	5	Targa Resources, Inc., 8.50%, 11/01/13		363,600
	600		Trans-Canada Pipelines Ltd., 5.85%, 3/15/36 (Canada)		575,310
	1,050		Valero Energy Corp., 6.625%, 6/15/37		1,081,095
	2,200		Virginia Electric & Power Co., Ser. A, 6.00%, 5/15/37		2,161,727
	625	5	Weatherford Int’l., Inc., 6.80%, 6/15/37		655,387
	415		Whiting Petroleum Corp., 7.25%, 5/01/12-5/01/13		407,938
	2,125		XTO Energy, Inc., 6.75%, 8/01/37		2,279,462
			Total Energy		36,976,099

See Notes to Financial Statements.

23 ANNUAL REPORT OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Entertainment & Leisure—0.9%
$	185		AMC Entertainment, Inc., 11.00%, 2/01/16	$	200,262
	250		Gaylord Entertainment Co., 6.75%, 11/15/14		242,500
	325	5	Greektown Holdings LLC, 10.75%, 12/01/13		323,375
	185		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		136,437
	2,000		Park Place Entertainment Corp., 8.875%, 9/15/08		2,027,500
	290		Seneca Gaming Corp., Ser. B, 7.25%, 5/01/12		292,175
	25		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., 6.625%, 12/01/14		24,563
			Total Entertainment & Leisure		3,246,812
Financial Institutions—20.9%
	350		American Real Estate Partners LP/American Real Estate Finance Corp., 7.125%, 2/15/13		341,250
			Bank of America Corp.,
	2,850	2	6.00%, 9/01/17		2,905,373
	2,450	2	7.80%, 2/15/10		2,597,750
	1,975	2	Bank of America NA, Ser. BKNT, 6.10%, 6/15/17		2,021,363
	1,400		Bear Stearns Cos., Inc. (The), Ser. MTN, 6.95%, 8/10/12		1,456,969
	2,525	2	Berkshire Hathaway Finance Corp., 3.375%, 10/15/08		2,491,311
	202	1,5	BMS Holdings, Inc., 12.40%, 2/15/12		193,771
	1,415		Chubb Corp., 6.00%, 5/11/37		1,376,861
			Citigroup, Inc.,
	5,230	2,3	4.125%, 2/22/10		5,142,628
	1,155		5.875%, 2/22/33-5/29/37		1,097,862
	1,200	2	6.125%, 8/25/36		1,170,559
	550		6.875%, 2/15/98		560,083
			Credit Suisse First Boston, Inc.,
	700	3	6.125%, 11/15/11		723,814
	1,000		7.125%, 7/15/32		1,127,028
	4,150	5	Depfa ACS Bank, 5.125%, 3/16/37 (Ireland)		3,925,431
			Ford Motor Credit Co. LLC,
	380		7.80%, 6/01/12		357,038
	220	1	7.993%, 1/13/12		203,671
			Fort Irwin Land LLC,
	780	5	Ser. A, Class II, 5.30%, 12/15/35		736,086
	575	5	Ser. A-1, 5.03%, 12/15/25		542,420
			General Electric Capital Corp.,
	3,000	2	6.75%, 3/15/32		3,347,964
	7,610	2	Ser. GMTN, 6.15%, 8/01/37		7,885,360
			Goldman Sachs Group, Inc. (The),
	5,390		5.45%, 11/01/12		5,422,151
	1,020		6.25%, 9/01/17		1,057,991
	1,000		6.60%, 1/15/12		1,047,663
	1,020	1	Hartford Life Global Funding Trusts, Ser. MTN, 5.864%, 9/15/09		1,018,899
	1,275		HSBC Holdings Plc, 6.50%, 5/02/36 (United Kingdom)		1,258,708
	878	5	iPayment Investors LP, 11.625%, 7/15/14		904,475
	270		iPayment, Inc., 9.75%, 5/15/14		259,200
	4,375	2	JPMorgan Chase Capital XXV, Ser. Y, 6.80%, 10/01/37		4,370,174
			Lehman Brothers Holdings, Inc.,
	1,050		6.50%, 7/19/17		1,057,475
	1,500		Ser. MTN, 6.00%, 7/19/12		1,520,782
	575	1	Ser. MTN, 7.394%, 9/15/22		587,536
	100		Ser. MTNG, 4.80%, 3/13/14		94,845
	1,200		MetLife, Inc., 5.70%, 6/15/35		1,112,330
			Momentive Performance Materials, Inc.,
	50	5	9.75%, 12/01/14		48,750
	440	5	11.50%, 12/01/16		424,600
	1,990	1,5	Monumental Global Funding Ltd., Ser. MTN, 5.24%, 6/16/10 (Cayman Islands)		1,972,090

Principal Amount (000)			Description	Value
Financial Institutions—(cont’d)
			Morgan Stanley,
$	3,620	1,2	5.493%, 1/09/12	$	3,561,707
	2,100	2	6.25%, 8/09/26		2,069,773
	1,200	2	Ser. MTN, 6.25%, 8/28/17		1,228,642
	950		Prudential Financial, Inc., Ser. MTN, 5.70%, 12/14/36		881,463
			Rainbow National Services LLC,
	225	5	8.75%, 9/01/12		234,000
	1,070	5	10.375%, 9/01/14		1,177,000
	600	1	SLM Corp., 5.384%, 1/27/14		530,617
	1,050		Travelers Cos., Inc., Ser. MTN, 6.25%, 6/15/37		1,035,953
	50	1	Universal City Florida Holding Co. I/II, 9.661%, 5/01/10		51,125
	1,000		Wells Fargo & Co., 4.625%, 8/09/10		990,341
			Wells Fargo Bank NA,
	610		5.95%, 8/26/36		601,139
	2,000	2	7.55%, 6/21/10		2,124,152
	650	5	Wimar Opco LLC/Wimar Opco Finance Corp., 9.625%, 12/15/14		487,500
	1,875	5	Xstrata Finance Ltd., 5.80%, 11/15/16 (Canada)		1,859,526
			Total Financial Institutions		79,195,199
Health Care—3.9%
	1,325	1,2,5	Amgen, Inc., 5.585%, 11/28/08		1,322,611
	1,825	2	AstraZeneca Plc, 6.45%, 9/15/37 (United Kingdom)		1,923,044
	1,135		Bristol-Myers Squibb Co., 5.875%, 11/15/36		1,114,049
	2,495	2	Eli Lilly & Co., 5.55%, 3/15/37		2,382,421
	1,200	2	Johnson & Johnson, 5.95%, 8/15/37		1,255,031
	1,250		Schering-Plough Corp., 6.55%, 9/15/37		1,295,480
	1,640		Tenet Healthcare Corp., 6.50%, 6/01/12		1,389,900
	1,175		Teva Pharmaceutical Finance LLC, 6.15%, 2/01/36		1,156,612
			WellPoint, Inc.,
	595		5.85%, 1/15/36		559,086
	475		6.375%, 6/15/37		482,920
	1,775	2	Wyeth, 5.95%, 4/01/37		1,755,436
			Total Health Care		14,636,590
Industrials—1.4%
	1,700		3M Co., Ser. MTN, 5.70%, 3/15/37		1,704,694
	400	5	AGY Holding Corp., 11.00%, 11/15/14		394,000
	150		Hexcel Corp., 6.75%, 2/01/15		147,375
	915		Honeywell Intl., Inc., 5.70%, 3/15/37		889,533
	165		Park-Ohio Industries, Inc., 8.375%, 11/15/14		153,862
			RBS Global, Inc./Rexnord Corp.,
	540		9.50%, 8/01/14		557,550
	555		11.75%, 8/01/16		588,300
	1,050	5	Sunstate Equipment Co. LLC, 10.50%, 4/01/13		1,008,000
			Total Industrials		5,443,314
Media—7.4%
			Affinion Group, Inc.,
	540		10.125%, 10/15/13		562,950
	200		11.50%, 10/15/15		208,500
	125		American Media Operations, Inc., Ser. B, 10.25%, 5/01/09		119,688
			AOL Time Warner, Inc.,
	1,635		7.57%, 2/01/24		1,791,676
	3,000		9.125%, 1/15/13		3,448,833
	1,415		AT&T Broadband Corp., 8.375%, 3/15/13		1,596,700
	161	1	Cablevision Systems Corp., Ser. B, 9.644%, 4/01/09		165,427
	120		CanWest MediaWorks, Inc., 8.00%, 9/15/12 (Canada)		117,000
	485		Charter Communications Holdings I LLC/Charter Communications Holdings I Capital Corp., 11.00%, 10/01/15		470,450
			Charter Communications Holdings II LLC/Charter Communications Holdings II Capital Corp.,
	1,320		10.25%, 9/15/10		1,346,400
	180		Ser. B, 10.25%, 9/15/10		183,150

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	24

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Media—(cont’d)
$	690		CMP Susquehanna Corp., 9.875%, 5/15/14	$	633,937
	1,000		Comcast Cable Communications, Inc., 6.75%, 1/30/11		1,042,435
	1,805		Comcast Corp., 6.95%, 8/15/37		1,931,570
	85		Dex Media West LLC/Dex Media Finance Co., Ser. B,
			9.875%, 8/15/13		90,631
	140		DirecTV Holdings LLC/DirecTV Financing Co.,
			8.375%, 3/15/13		146,300
			EchoStar DBS Corp.,
	180		5.75%, 10/01/08		179,550
	320		7.00%, 10/01/13		333,200
	75		7.125%, 2/01/16		78,375
	665		Idearc, Inc., 8.00%, 11/15/16		666,662
	500	1,5	ION Media Networks, Inc., 8.493%, 1/15/12		501,250
	535		Network Communications, Inc., 10.75%, 12/01/13		538,344
			News America Holdings, Inc.,
	145		8.15%, 10/17/36		172,776
	2,475		8.45%, 8/01/34		2,992,265
	660		Nexstar Finance, Inc., 7.00%, 1/15/14		633,600
			Nielsen Finance LLC/Nielsen Finance Co.,
	330	7	9.115%, 8/01/16		238,425
	1,100		10.00%, 8/01/14		1,157,750
	950		RH Donnelley Corp., Ser. A-3, 8.875%, 1/15/16		950,000
	70		Sirius Satellite Radio, Inc., 9.625%, 8/01/13		69,563
	1,495		TCI Communications, Inc., 8.75%, 8/01/15		1,753,387
	800	5	Time Warner Cable, Inc., 6.55%, 5/01/37		806,473
	1,100	5	TL Acquisitions, Inc., 10.50%, 1/15/15		1,094,500
	325	5	Univision Communications, Inc., 9.75%, 3/15/15		318,500
	570		Vertis, Inc., 9.75%, 4/01/09		570,000
	1,294		Young Broadcasting, Inc., 10.00%, 3/01/11		1,216,360
			Total Media		28,126,627
Real Estate—0.9%
	1,000		AvalonBay Communities, Inc., 6.625%, 9/15/11		1,040,161
			Rouse Co.,
	725		3.625%, 3/15/09		691,205
	1,715		5.375%, 11/26/13		1,554,092
			Total Real Estate		3,285,458
Technology—2.1%
			Amkor Technology, Inc.,
	90		7.75%, 5/15/13		87,075
	135		9.25%, 6/01/16		138,038
	555		Celestica, Inc., 7.625%, 7/01/13 (Canada)		532,800
			Freescale Semiconductor, Inc.,
	715		9.125%, 12/15/14		647,075
	160	1	9.569%, 12/15/14		147,000
	3,450	2	Intl. Business Machines Corp., 5.70%, 9/14/17		3,501,702
	480		NXP BV/NXP Funding LLC, 9.50%, 10/15/15 (Netherlands)		453,600
	660		Sanmina-SCI Corp., 8.125%, 3/01/16		579,150
			SunGard Data Systems, Inc.,
	95		9.125%, 8/15/13		96,900
	675		10.25%, 8/15/15		703,687
	950		Superior Essex Communications LLC/Essex Group, Inc., 9.00%, 4/15/12		938,125
			Total Technology		7,825,152
Telecommunications—7.5%
	4,075	2	AT&T, Inc., 6.50%, 9/01/37		4,298,391
	1,700	9	BellSouth Telecommunications, 6.402%, 12/15/95		902,807
	470		Cincinnati Bell, Inc., 7.25%, 7/15/13		471,175
	255		Cricket Communications, Inc., 9.375%, 11/01/14		253,088
	325		Deutsche Telekom Intl. Finance BV, 5.75%, 3/23/16 (Netherlands)		325,854
	270	5	Digicel Group Ltd., 8.875%, 1/15/15 (Bermuda)		252,126

Principal Amount (000)			Description	Value
Telecommunications—(cont’d)
$	170	1	Hawaiian Telcom Communications, Inc., Ser. B, 10.318%, 5/01/13	$	172,125
	515		Intelsat Corp., 9.00%, 6/15/16		526,588
			Intelsat Ltd. (Bermuda)
	120	1	8.886%, 1/15/15		121,800
	450		9.25%, 6/15/16		466,875
	210		11.25%, 6/15/16		225,750
	920	1	11.409%, 6/15/13		959,100
	300		Intelsat Subsidiary Holding Co. Ltd., 8.625%, 1/15/15 (Bermuda)		304,500
	120	5	MetroPCS Wireless, Inc., 9.25%, 11/01/14		119,100
	935	5	Nordic Telephone Co. Holdings A.p.S., 8.875%, 5/01/16 (Denmark)		988,763
	1,435	1,5	Nortel Networks Ltd., 9.493%, 7/15/11 (Canada)		1,417,062
	160		PanAmSat Corp., 9.00%, 8/15/14		163,200
			Qwest Corp.,
	55		7.875%, 9/01/11		58,025
	375	1	8.944%, 6/15/13		399,844
			Sprint Capital Corp.,
	1,205		6.875%, 11/15/28		1,154,325
	1,250		8.75%, 3/15/32		1,425,325
	4,375		Telecom Italia Capital S.A., 4.95%, 9/30/14 (Luxembourg)		4,187,492
	1,000		Telefonica Emisones SAU, 7.045%, 6/20/36 (Spain)		1,098,404
	575		Verizon Global Funding Corp., 7.75%, 6/15/32		677,879
			Verizon Maryland, Inc.,
	540		5.125%, 6/15/33		450,386
	1,355		Ser. A, 6.125%, 3/01/12		1,396,925
	750		Verizon Virginia, Inc., 4.625%, 3/15/13		720,208
			Vodafone Group Plc (United Kingdom)
	1,615	1,2	5.288%, 12/28/07		1,615,326
	1,000		7.75%, 2/15/10		1,057,537
	1,210		West Corp., 11.00%, 10/15/16		1,267,475
	360	5	Wind Acquisition Finance S.A., 10.75%, 12/01/15 (Luxembourg)		400,500
			Windstream Corp.,
	410		8.125%, 8/01/13		433,575
	250		8.625%, 8/01/16		267,500
			Total Telecommunications		28,579,030
Transportation—0.7%
	120		American Airlines, Inc., Ser. 99-1, 7.324%, 4/15/11		118,500
	120		Britannia Bulk Plc, 11.00%, 12/01/11 (United Kingdom)		126,000
	1,000		Canadian National Railway Co., 6.375%, 10/15/11 (Canada)		1,044,565
	450		CHC Helicopter Corp., 7.375%, 5/01/14 (Canada)		435,375
	600		Navios Maritime Holdings, Inc., 9.50%, 12/15/14 (Marshall Islands)		634,500
	455	5	St. Acquisition Corp., 12.50%, 5/15/17		290,062
			Total Transportation		2,649,002
			Total Corporate Bonds		242,814,753
U.S. Government and Agency Securities—5.7%
			Overseas Private Investment Corp.,
	357		4.09%, 5/29/12		338,675
	1,000	1	4.30%, 5/29/12		1,000,255
	752		4.64%, 5/29/12		761,852
	425		4.68%, 5/29/12		404,472
	3,221		4.87%, 5/29/12		3,295,838
	384	1	5.40%, 5/29/12		413,963
	6,055		Resolution Funding Corp., Ser. B, Zero Coupon, 4/15/30		2,018,561
	788		Small Business Administration, Ser. 20K-1, 6.95%, 11/01/16		812,396
	1,800		Tennessee Valley Authority, Ser. C, 5.88%, 4/01/36		1,989,677
	510		U.S. Treasury Bonds, 4.75%, 2/15/37		509,721
	846		U.S. Treasury Inflation Protected Bond, 2.375%, 1/15/27		867,527
	9,115	2	U.S. Treasury Notes, 4.75%, 8/15/17		9,315,813
			Total U.S. Government and Agency Securities		21,728,750

See Notes to Financial Statements.
25	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Trust Preferred Stocks—3.5%
$	2,150	1,2	Allstate Corp., 6.50%, 5/15/57	$	2,084,728
	600		Bank of America, 5.30%, 3/15/17		579,691
	950	1,5,10	Barclays Bank Plc, 7.434% (United Kingdom)		1,007,039
	1,000	1,5,10	Credit Agricole S.A., 6.637% (France)		950,372
	750	1	Lincoln National Corp., 6.05%, 4/20/67		718,801
	665	1	Progressive Corp., 6.70%, 6/15/37		652,553
	2,600	1,10	Royal Bank of Scotland Group Plc, Ser. MTN, 7.64% (United Kingdom)		2,694,931
	1,125	1,2,5,10	Societe Generale, 5.922% (France)		1,070,652
	750	1	Travelers Cos., Inc., 6.25%, 3/15/67		728,300
	2,000	1,2,10	UBS Preferred Funding Trust I, 8.622%		2,170,314
	575	1,5	ZFS Finance Trust I, 6.50%, 5/09/37		553,382
			Total Trust Preferred Stocks		13,210,763
Taxable Municipal Bond—0.6%
	2,525		Illinois St. Pension, 5.10%, 6/01/33		2,395,139
	Shares
Common Stocks—0.0%
	1,895	6,11	Critical Care Systems Intl., Inc.		11,844
Preferred Stock—0.4%
	60,000		Deutsche Bank Contingent Capital Trust II, 6.55%		1,437,000
			Total Long-Term Investments (cost $639,074,109)		636,433,097

Principal Amount (000)
SHORT-TERM INVESTMENT—0.1%
U.S. Government and Agency Discount Notes—0.1%
$	300	12	Federal Home Loan Bank Disc. Notes, 4.401%, 11/01/07 (cost $300,000)	300,000
BORROWED BOND AGREEMENTS—22.5%
			Lehman Brothers Inc.,
	50,927	14	4.47%, 11/08/07	50,927,000
	34,457	14	4.45%, 11/08/07	34,456,875
			Total Borrowed Bond Agreements (cost $85,383,875)	85,383,875

Notional Amount (000)
OUTSTANDING OPTIONS PURCHASED—1.0%
	4,285	EUR Put Option, strike price $1.40, expires 1/10/08	17,876
		Interest Rate Swaps,
	8,400	Trust pays 5.79%, Trust receives 3-month LIBOR, expires 8/16/10	225,776
	8,400	Trust pays 3-month LIBOR, Trust receives 5.79%, expires 8/16/10	433,872
	5,500	Trust pays 5.52%, Trust receives 3-month LIBOR, expires 9/21/36	373,168
	5,500	Trust pays 3-month LIBOR, Trust receives 5.52%, expires 9/21/36	324,406
	12,300	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	575,025
	12,300	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	527,670
	8,425	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	517,969

Notional Amount (000)		Description	Value
OUTSTANDING OPTIONS PURCHASED—(cont’d)
	8,425	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	$	265,977
	7,300	Trust pays 5.39%, Trust receives 3-month LIBOR, expires 3/19/12		357,114
	7,300	Trust pays 3-month LIBOR, Trust receives 5.39%, expires 3/19/12		296,161
		Total Outstanding Options Purchased (cost $3,589,612)		3,915,014
		Total Investments before borrowed bonds, TBA sale commitments, and outstanding options written (cost $728,347,59613)		726,031,986
Principal Amount (000)
BORROWED BONDS—(22.5)%
		U.S. Treasury Notes,
$	(50,800)	4.00%, 8/31/09		(50,835,712	)
	(34,500)	4.125%, 8/31/12		(34,464,948	)
		Total Borrowed Bonds (proceeds $85,264,516)		(85,300,660	)
TBA SALE COMMITMENTS—(3.5)%
		Federal National Mortgage Assoc.,
	(400)	5.00%, 12/12/37		(383,625	)
	(8,600)	5.50%, 11/19/22		(8,613,433	)
	(4,200)	6.00%, 11/13/37-12/12/37		(4,228,314	)
		Total TBA Sale Commitments (proceeds $13,086,862)		(13,225,372	)
INVESTMENTS SOLD SHORT—(22.5)%
		U.S. Treasury Notes,
	(50,800)	4.00%, 8/31/09		(50,835,712	)
	(34,500)	4.125%, 8/31/12		(34,464,948	)
		Total Investments Sold Short (proceeds $85,264,516)		(85,300,660	)

Notional Amount (000)
OUTSTANDING OPTIONS WRITTEN—(0.5)%
		Interest Rate Swaps,
	(5,700)	Trust pays 5.135%, Trust receives 3-month LIBOR, expires 4/21/08		(97,385	)
	(5,700)	Trust pays 3-month LIBOR, Trust receives 5.135%, expires 4/21/08		(97,385	)
	(12,400)	Trust pays 3-month LIBOR, Trust receives 5.67%, expires 1/04/10		(315,828	)
	(12,400)	Trust pays 5.67%, Trust receives 3-month LIBOR, expires 1/04/10		(599,912	)
	(5,300)	Trust pays 5.485%, Trust receives 3-month LIBOR, expires 10/28/19		(208,227	)
	(5,300)	Trust pays 3-month LIBOR, Trust receives 5.485%, expires 10/28/19		(155,709	)
	(7,300)	Trust pays 3-month LIBOR, Trust receives 5.148%, expires 3/19/08		(119,063	)
	(7,300)	Trust pays 5.115%, Trust receives 3-month LIBOR, expires 3/19/08		(118,698	)
		Total Outstanding Options Written (premium received $2,478,560)		(1,712,207	)
Total Investments net of borrowed bonds, TBA sale commitments and outstanding options written—164.8%			$	625,793,747
Liabilities in excess of other assets—(64.8)%				(246,188,870	)
Net Assets—100%			$	379,604,877

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	26

Portfolio of Investments as of October 31, 2007	BlackRock Income Opportunity Trust (BNA) (concluded)
	(Percentages shown are based on Net Assets)

1	Variable rate security. Rate shown is interest rate as of October 31, 2007.
2	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
3	Security, or a portion thereof, pledged as collateral with a value of $2,950,914 on 147 long Eurodollar futures contracts expiring December 2007 to March 2008, 337 long U.S. Treasury Note futures contracts expiring December 2007, 1,339 long U.S. Treasury Bond futures contracts expiring December 2007, 180 short Eurodollar futures contracts expiring December 2007 and 3,750 short U.S. Treasury Note futures contracts expiring December 2007. The notional value of such contracts on October 31, 2007 was $246,676,023, with an unrealized loss of $650,550.
4	Represents an investment in an affiliate.
5	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 9.0% of its net assets, with a current market value of $34,233,806, in securities restricted as to resale.
6	Security is fair valued.
7	Rate shown is effective yield of the underlying collateral as of October 31, 2007.
8	Illiquid security. As of October 31, 2007, the Trust held less than 0.1% of its net assets, with a current market value of $0, in this security.
9	Represents a step up bond; the interest rate shown reflects the effective yield at the time of purchase.
10	The security is a perpetual bond and has no stated maturity date.
11	Non-income producing security.
12	Rate shown is the yield to maturity as of the date of purchase.
13	Cost for federal income tax purposes is $729,365,583. The net unrealized depreciation on a tax basis is $3,333,597, consisting of $7,722,546 gross unrealized appreciation and $11,056,143 gross unrealized depreciation.
14	See Note 1 in the Notes to Financial Statements for details of borrowed bond agreements.

For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.
27	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Income Trust Inc. (BKT)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
LONG-TERM INVESTMENTS—104.8%
Mortgage Pass-Through Securities—31.2%
			Federal Home Loan Mortgage Corp.,
$	775	1	4.019%, 1/01/35	$	773,674
	802	1	4.934%, 10/01/34		806,789
	92		5.50%, 12/01/21		92,516
	609	2	5.50%, 1/01/22		609,749
	8,423	2,3	5.50%, 3/01/22		8,436,410
	27	1	6.01%, 11/01/17		27,570
	14		8.00%, 11/01/15		13,954
	—		8.50%, 3/01/08		15
	124	2	9.00%, 9/01/20		132,699
	100		TBA, 6.50%, 12/12/37		102,406
			Federal National Mortgage Assoc.,
	31,248		5.00%, 6/01/33-3/01/37		30,045,633
	732	2	5.00%, 1/01/37		702,248
	44,873		5.50%, 6/01/21-6/01/37		44,632,581
	3,125		5.97%, 8/01/16		3,184,788
	22,939		6.00%, 10/01/36-7/01/37		23,108,362
	12,645		6.50%, 7/01/36-9/01/37		12,943,071
	—		7.50%, 2/01/22		241
	32		8.00%, 5/01/08-5/01/22		32,874
	3		9.50%, 1/01/19-9/01/19		4,163
	100		TBA, 5.50%, 11/13/37		98,531
	1,700		TBA, 6.00%, 11/13/37		1,712,220
	2,200		TBA, 6.50%, 11/13/37		2,251,564
			Government National Mortgage Assoc.,
	37		7.00%, 10/15/17		38,792
	412		7.50%, 8/15/21-12/15/23		434,645
	210		8.00%, 10/15/22-2/15/29		223,884
	15		9.00%, 6/15/18-9/15/21		17,385
			Total Mortgage Pass-Through Securities		130,426,764
Federal Housing Administration Securities—1.8%
			General Motors Acceptance Corp. Projects,
	288	4	Ser. 51, 7.43%, 2/01/23		290,577
	358		Ser. 56, 7.43%, 11/01/22		361,639
	50	5	Merrill Projects, Ser. 54, 7.43%, 5/15/23		50,019
	758		Reilly Project, Ser. 41, 8.28%, 3/01/20		765,282
			USGI Projects,
	88		Ser. 87, 7.43%, 12/01/22		88,790
	329		Ser. 99,7.43%, 10/01/23		332,589
	5,431		Ser. 6094, 7.43%, 6/01/21		5,485,577
			Total Federal Housing Administration Securities		7,374,473
Agency Multiple Class Mortgage Pass-Through Securities—26.3%
			Federal Home Loan Mortgage Corp.,
	4,076	1	Ser. 11, Class A9, 2.282%, 1/25/28		3,595,985
	187		Ser. 19, Class F, 8.50%, 3/15/20		194,531
	746		Ser. 40, Class K, 6.50%, 8/17/24		768,950
	—	1	Ser. 192, Class U, 1,009.033%, 2/15/22		7
	—		Ser. 1057, Class J, 1,008.001%, 3/15/21		1,589
	1,647		Ser. 1598, Class J, 6.50%, 10/15/08		1,643,738
	341		Ser. 1961, Class H, 6.50%, 5/15/12		345,289
	9,504		Ser. 2218, Class Z, 8.50%, 3/15/30		10,279,474
	13,018		Ser. 2461, Class Z, 6.50%, 6/15/32		13,445,486
	10,200		Ser. 2542, Class UC, 6.00%, 12/15/22		10,599,985
	2,475		Ser. 2562, Class PG, 5.00%, 1/15/18		2,444,405
	928		Ser. 2564, Class NC, 5.00%, 2/15/33		795,889
	2,050		Ser. 2750, Class TC, 5.25%, 2/15/34		2,015,608
	11,458		Ser. 2758, Class KV, 5.50%, 5/15/23		11,448,878
	1,573		Ser. 2765, Class UA, 4.00%, 3/15/11		1,529,913
	3,212		Ser. 2806, Class VC, 6.00%, 12/15/19		3,265,494
	2,402		Ser. 2927, Class BZ, 5.50%, 2/15/35		2,245,710
	3,946		Ser. 3061, Class BD, 7.50%, 11/15/35		4,063,969

	Principal Amount (000)		Description	Value
Agency Multiple Class Mortgage Pass-Through Securities—(cont’d)
			Federal National Mortgage Assoc.,
$	1,221	1	Ser. 2, Class KP, Zero Coupon, 2/25/35	$	1,153,297
	4,006		Ser. 28, Class PB, 6.00%, 8/25/28		4,028,409
	2,150		Ser. 29, Class HC, 7.50%, 7/25/30		2,288,156
	2,381		Ser. 31, Class ZG, 7.50%, 5/25/34		2,841,336
	7,147		Ser. 32, Class VT, 6.00%, 9/25/15		7,258,242
	1		Ser. 33, Class PV, 1,078.42%, 10/25/21		20,464
	50	1	Ser. 38, Class F, 8.325%, 4/25/21		51,981
	1,663		Ser. 38, Class Z, 5.00%, 5/25/36		1,655,826
	2,630		Ser. 68, Class PC, 5.50%, 7/25/35		2,657,932
	12,264		Ser. 135, Class PB, 6.00%, 1/25/34		12,319,211
			Government National Mortgage Assoc.,
	1,041		Ser. 5, Class Z, 7.00%, 5/16/26		1,089,576
	1,749		Ser. 33, Class PB, 6.50%, 7/20/31		1,793,424
	4,030		Ser. 89, Class PE, 6.00%, 10/20/34		4,118,536
			Total Agency Multiple Class Mortgage Pass-Through Securities		109,961,290
Non-Agency Multiple Class Mortgage Pass-Through Securities—9.5%
	5,932		CWALT, Inc., Ser. 28CB, Class 1A5, 5.50%, 8/25/35		5,926,543
			JPMorgan Mortgage Trust,
	1,868	1	Ser. A7, Class 2A2, 5.83%, 1/25/37		1,865,043
	6,457		Ser. S1, Class 2A1, 8.00%, 1/25/35		6,827,600
	1,561		MASTR Alternative Loan Trust, Ser. 7, Class 4A3, 8.00%, 11/25/18		1,634,533
	7,488		MASTR Asset Securitization Trust, Ser. 12, Class 3A5, 5.25%, 10/25/14		7,358,441
	5,697	1	Residential Asset Securitization Trust, Ser. A8, Class A2, 5.223%, 10/25/18		5,630,061
	9,908		Residential Funding Securities Corp., Ser. RM2, Class AI5, 8.50%, 5/25/33		10,580,089
	14	1,6,7	Summit Mortgage Trust, Ser. 1, Class B1, 6.611%, 12/28/12		14,138
			Total Non-Agency Multiple Class Mortgage Pass-Through Securities		39,836,448
Inverse Floating Rate Mortgage Securities—4.3%
			Federal Home Loan Mortgage Corp.,
	14	1	Ser. 1043, Class H, 21.938%, 2/15/21		14,443
	—	1	Ser. 1148, Class E, 592.552%, 10/15/21		545
	32	1	Ser. 1160, Class F, 18.381%, 10/15/21		31,693
	96	1,2	Ser. 1616, Class SB, 8.50%, 11/15/08		96,046
	192	1	Ser. 1688, Class S, 9.566%, 12/15/13		192,669
	4,359	1	Ser. 2769, Class SQ, Zero Coupon, 2/15/34		2,718,727
	2,101	1	Ser. 2840, Class SK, 1.499%, 8/15/34		1,600,748
	2,373	1	Ser. 3167, Class SX, 6.953%, 6/15/36		2,277,238
			Federal National Mortgage Assoc.,
	—	1	Ser. 7, Class S, 594.704%, 3/25/21		6,484
	1	1	Ser. 10, Class S, 575.455%, 5/25/21		19,584
	1	1	Ser. 12, Class S, 608.135%, 5/25/21		17,025
	1	1	Ser. 17, Class S, 580.114%, 6/25/21		9,925
	51	1	Ser. 38, Class SA, 10.186%, 4/25/21		53,332
	—	1	Ser. 46, Class S, 1,402.625%, 5/25/21		7,283
	—	1	Ser. 49, Class S, 527.80%, 12/25/21		3,478
	114	1	Ser. 72, Class S, 8.75%, 5/25/08		114,584
	5,828	1	Ser. 73, Class DS, 4.882%, 8/25/35		5,625,111
	119	1	Ser. 87, Class S, 13.764%, 8/25/21		144,608
	26	1	Ser. 93, Class S, 8.50%, 5/25/08		26,334
	12	1	Ser. 170, Class SC, 9.00%, 9/25/08		11,829
	222	1	Ser. 196, Class SC, 8.423%, 10/25/08		222,978
	110	1	Ser. 214, Class SH, 5.592%, 12/25/08		109,958
	899	1	Ser. 247, Class SN, 10.00%, 12/25/23		1,002,361
			First Horizon Alternative Mortgage Securities,
	72,527	1	Ser. FA7, Class 1A7, Zero Coupon, 10/25/35		736,052
	179,328	1	Ser. FA9, Class A2, Zero Coupon, 12/25/35		1,905,915

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	28

Portfolio of Investments as of October 31, 2007	BlackRock Income Trust Inc. (BKT) (continued)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
Inverse Floating Rate Mortgage Securities—(cont’d)
$	112	1	Kidder Peabody Acceptance Corp., Ser. 1, Class A6, 7.573%, 8/25/23	$	112,216
	145,657	1	Residential Accredit Loans, Inc., Ser. QS16, Class A2, Zero Coupon, 11/25/35		818,081
			Total Inverse Floating Rate Mortgage Securities		17,879,247
Interest Only Asset-Backed Securities—0.4%
	110,512	1	Banc of America Funding Corp., Ser. 2, Class 1A19, 0.528%, 3/25/37		691,670
	81	1,6	Morgan Stanley Capital Trust I, Ser. HF1, Class X, 2.25%, 6/15/17		4
			Sterling Coofs Trust,
	15,750		Ser. 1, 2.365%, 4/15/29		698,905
	11,244	6	Ser. 2, 2.081%, 3/30/30		302,195
			Total Interest Only Asset-Backed Securities		1,692,774
Interest Only Mortgage-Backed Securities—12.7%
	1,135		ABN Amro Mortgage Corp., Ser. 4, Class A2, 5.50%, 3/25/33		28,901
	229,295	1	Banc of America Mortgage Securities, Inc., Ser. 3, Class 1A, 0.285%, 5/25/18		1,896,595
	25,802	1	Commercial Mortgage Acceptance Corp., Ser. ML1, 0.705%, 11/15/17		458,311
	5,770	1,6	Credit Suisse First Boston Mortgage Securities Corp., Ser. C1, Class AX, 1.486%, 6/20/29		304,690
	142,857	1	CWALT, Inc., Ser. 79CB, Class A2, 0.078%, 1/25/36		1,827,318
			Federal Home Loan Mortgage Corp.,
	1,972	1	Ser. 60, Class HS, 1.125%, 4/25/24		7,746
	—		Ser. 176, Class M, 1,010.00%, 7/15/21		70
	—	7	Ser. 200, Class R, 98,513.94%, 12/15/22		300
	1,735		Ser. 204, Class IO, 6.00%, 5/01/29		407,040
	—	1	Ser. 1054, Class I, 435.32%, 3/15/21		180
	—		Ser. 1056, Class KD, 1,084.50%, 3/15/21		1,195
	—		Ser. 1179, Class O, 1,009.389%, 11/15/21		82
	168		Ser. 1706, Class IA, 7.00%, 10/15/23		6,174
	59		Ser. 1720, Class PK, 7.50%, 1/15/24		3,125
	2,773		Ser. 1914, Class PC, 0.75%, 12/15/11		27,104
	719	1	Ser. 2296, Class SA, 2.659%, 3/15/16		40,402
	358	1	Ser. 2444, Class ST, 2.879%, 9/15/29		10,985
	1,417		Ser. 2542, Class MX, 5.50%, 5/15/22		211,221
	2,564		Ser. 2545, Class NI, 5.50%, 3/15/22		310,315
	490	1	Ser. 2559, Class IO, 0.50%, 8/15/30		4,929
	4,079		Ser. 2561, Class EW, 5.00%, 9/15/16		330,514
	10,535		Ser. 2611, Class QI, 5.50%, 9/15/32		1,911,501
	1,084		Ser. 2633, Class PI, 4.50%, 3/15/12		5,691
	16,307	1	Ser. 2647, Class IV, 1.959%, 7/15/33		1,159,405
	3,156		Ser. 2653, Class MI, 5.00%, 4/15/26		270,379
	3,750		Ser. 2658, Class PI, 4.50%, 6/15/13		87,123
	2,985		Ser. 2672, Class TQ, 5.00%, 3/15/23		61,706
	3,633		Ser. 2687, Class IL, 5.00%, 9/15/18		346,465
	1,352		Ser. 2687, Class IQ, 5.50%, 9/15/22		4,898
	3,237		Ser. 2693, Class IB, 4.50%, 6/15/13		72,307
	2,454		Ser. 2694, Class LI, 4.50%, 7/15/19		201,286
	4,516		Ser. 2773, Class OX, 5.00%, 2/15/18		490,886
	16,428	1	Ser. 2780, Class SM, 0.909%, 4/15/34		417,281
	6,727		Ser. 2825, Class NI, 5.50%, 3/15/30		1,461,900
	10,587	1	Ser. 2827, Class SR, 0.909%, 1/15/22		305,563
	17,570	1	Ser. 2865, Class SR, 0.92%, 10/15/33		952,603
	11,899	1	Ser. 2865, Class SV, 1.327%, 10/15/33		1,073,798
	1,733		Ser. 2949, Class IO, 5.50%, 3/15/35		206,125
	33,027	1	Ser. 2990, Class WR, 1.519%, 6/15/35		1,984,065
	93,788	1	Ser. 3122, Class IS, 1.609%, 3/15/36		5,412,475
	90,419	1	Ser. 3225, Class EY, 1.199%, 10/15/36		4,422,749
	3,534		Ser. 3299, Class TI, 5.00%, 4/15/37		668,994

	Principal Amount (000)		Description	Value
Interest Only Mortgage-Backed Securities—(cont’d)
			Federal National Mortgage Assoc.,
$	200		Ser. 5, Class H, 9.00%, 1/25/22	$	45,871
	11		Ser. 7, Class 2, 8.50%, 4/01/17		2,133
	3,969		Ser. 9, Class BI, 5.50%, 10/25/22		562,098
	1		Ser. 12, Class C, 1,016.897%, 2/25/22		15,735
	3,608		Ser. 13, Class IG, 5.00%, 10/25/22		86,885
	738	1	Ser. 33, Class SG, 3.225%, 3/25/09		13,452
	50,106	1	Ser. 36, Class SP, 1.828%, 5/25/36		3,367,058
	—		Ser. 38, Class N, 1,008.50%, 4/25/21		438
	837		Ser. 43, Class LC, 6.00%, 3/25/34		198,642
	—		Ser. 50, Class G, 1,158.628%, 12/25/21		7,002
	674	1	Ser. 50, Class SI, 1.20%, 4/25/23		21,001
	3,006		Ser. 51, Class IE, 5.50%, 4/25/26		58,423
	5,340		Ser. 55, Class GI, 5.00%, 7/25/19		458,903
	12,224	1	Ser. 55, Class SB, 1.278%, 7/25/35		511,975
	3,707	1	Ser. 59, Class S, 4.917%, 10/25/22		569,668
	576	1	Ser. 60, Class SB, 1.60%, 10/25/22		25,680
	146		Ser. 62, Class IC, 5.50%, 7/25/15		1,538
	5,630		Ser. 66, Class CI, 5.00%, 7/25/33		1,376,325
	1,945	1	Ser. 68, Class SC, 3.225%, 1/25/24		103,751
	13,693	1	Ser. 73, Class ST, 1.258%, 8/25/35		546,888
	4,094		Ser. 88, Class TI, 4.50%, 11/25/13		109,742
	21		Ser. 89, Class 2, 8.00%, 6/01/18		3,910
	29,807	1	Ser. 90, Class JH, 1.828%, 11/25/34		1,667,334
	13,213		Ser. 90, Class M, 6.00%, 1/25/28		2,423,410
	7		Ser. 94, Class 2, 9.50%, 8/01/21		1,649
	—		Ser. 99, Class L, 930.00%, 8/25/21		6,013
	3,741		Ser. 122, Class IC, 5.00%, 9/25/18		368,323
	—		Ser. 123, Class M, 1,009.50%, 10/25/20		1,135
	25	1	Ser. 136, Class S, 15.214%, 11/25/20		32,457
	—		Ser. 139, Class PT, 648.35%, 10/25/21		7,582
	2,186	1	Ser. 199, Class SB, 2.625%, 10/25/23		113,348
	633		Ser. W4, Class IO, 6.50%, 12/25/28		135,539
	89		First Boston Mortgage Securities Corp., Ser. C, Class I, 10.965%, 4/25/17		21,021
	42,028	1	First Horizon Alternative Mortgage Securities, Ser. FA2, Class 1A4, 0.628%, 5/25/36		380,454
	6,323	1	General Motors Acceptance Corp., Commercial Mortgage Securities, Inc., Ser. C1, Class X, 1.315%, 7/15/27		320,421
	7,835	1,6	Goldman Sachs Mortgage Securities Corp., Ser. 5, 0.97%, 2/19/25		154,243
			Government National Mortgage Assoc.,
	16,722	1	Ser. 18, Class SL, 1.203%, 2/20/35		773,287
	1,650		Ser. 39, Class ID, 5.00%, 5/20/33		459,300
	1,945		Ser. 58, Class IT, 5.50%, 7/20/33		255,838
	1,717		Ser. 75, Class IJ, 5.50%, 7/20/25		10,022
	16,629	1	Ser. 89, Classl SA, 0.84%, 10/16/33		592,706
	153,908		Indymac Index Mortgage Loan Trust, Ser. AR33, Class 4AX, 0.165%, 1/25/37		700,218
	57		Kidder Peabody Acceptance Corp., Ser. B, Class A2, 9.50%, 4/22/18		13,028
	24,598		MASTR Adjustable Rate Mortgages Trust, Ser. 3, Class 3AX, 0.977%, 4/25/34		352,827
	1,311		MASTR Alternative Loan Trust, Ser. 9, Class 15X2, 6.00%, 1/25/19		245,404
	1,609		Morgan Stanley Capital Trust I, Ser. 3, Class 1AX, 5.00%, 5/25/19		237,158
	66,154	1	Sequoia Mortgage Trust, Ser. 2, Class XA, 0.775%, 3/20/35		686,683
	6,379	4	Small Business Administration, Ser. 1, 1.381%, 4/01/15		63,790

See Notes to Financial Statements.
29	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Income Trust Inc. (BKT) (continued)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
Interest Only Mortgage-Backed Securities—(cont’d)
			Structured Adjustable Rate Mortgage Loan Trust,
$	14,185	1	Ser. 2, Class 4AX, 5.50%, 3/25/36	$	1,346,970
	44,655	1	Ser. 7, Class 3AS, 2.548%, 8/25/36		4,353,522
	5,240	1	Ser. 18, Class 7AX, 5.50%, 9/25/35		751,739
	4,082		Ser. 20, Class 3AX, 5.50%, 10/25/35		755,438
	85,907	1	Vendee Mortgage Trust, Ser. 2, Class 1, 0.052%, 5/15/29		215,679
			Total Interest Only Mortgage-Backed Securities		52,928,053
Principal Only Mortgage-Backed Securities—4.9%
			Countrywide Home Loans, Inc.,
	5,329	8	Ser. 26, 4.944%, 8/25/33		4,217,491
	1,043	8	Ser. J4, 5.142%, 6/25/33		745,815
	1,427	8	Ser. J5, 4.911%, 7/25/33		847,321
	1,152	8	Ser. J8, 4.787%, 9/25/23		882,292
			Drexel Burnham Lambert, Inc.,
	22	8	Ser. K, Class 1, 11.50%, 9/23/17		22,301
	269	8	Ser. V, Class 1, 11.50%, 9/01/18		240,360
			Federal Home Loan Mortgage Corp.,
	233	8	Ser. 8, Class A10, 6.737%, 11/15/28		208,620
	153	8	Ser. 1418, Class M, 7.50%, 11/15/22		144,736
	577	8	Ser. 1571, Class G, 7.50%, 8/15/23		538,553
	2,044	8	Ser. 1691, Class B, 7.50%, 3/15/24		1,825,583
	184	8	Ser. 1739, Class B, 7.50%, 2/15/24		170,847
			Federal National Mortgage Assoc.,
	298	8	Ser. 2, Class KB, 8.00%, 1/25/23		251,437
	43	8	Ser. 7, Class J, 10.00%, 2/25/21		36,451
	896	8	Ser. 13, Class PR, 6.50%, 3/25/32		721,798
	143	8	Ser. 51, Class E, 8.00%, 2/25/23		124,053
	24	8	Ser. 70, Class A, 7.00%, 5/25/23		20,709
	47	8	Ser. 167, Class D, 8.50%, 10/25/17		45,077
	43	8	Ser. 203, Class 1, 8.00%, 2/01/23		36,053
	30	8	Ser. 228, Class 1, 7.00%, 5/01/23		24,248
	1,947	8	Ser. 249, Class B, 7.50%, 11/25/23		1,662,352
	232	8	Ser. 273, Class 1, 7.00%, 7/01/26		186,899
	4,422	8	Ser. 328, Class 1, 6.00%, 11/01/32		3,411,524
	3,590	8	Ser. 338, Class 1, 5.50%, 6/01/33		2,672,048
	336	8	Ser. W4, Class PO, 5.985%, 2/25/29		263,208
	314	8	MASTR Asset Securitization Trust, Ser. 3, Class 4A15, 5.634%, 3/25/34		173,253
	983	8	Residential Asset Securitization Trust, Ser. A15, Class 1A8, 5.713%, 2/25/36		502,836
	12	4,8	Structured Mortgage Asset Residential Trust, Ser. 3C, Class CX, 7.031%, 4/25/24		11,439
	956	8	Washington Mutual, Ser. 9, Class CP, 5.112%, 11/25/35		721,550
			Total Principal Only Mortgage-Backed Securities		20,708,854
Collateralized Mortgage Obligation Residual Securities—0.0%
			Collateralized Mortgage Obligation Trust,
	—	7	Ser. 40, Class R, 580.50%, 4/01/18		338
	—	7	Ser. 42, Class R, 6,000.00%, 10/01/14		3,440
			Federal Home Loan Mortgage Corp.,
	—	7	Ser. 19, Class R, 9,757.652%, 3/15/20		2,952
	—	7	Ser. 75, Class R, 9.50%, 1/15/21		5
	—	7	Ser. 75, Class RS, 17.757%, 1/15/21		5
	—	7	Ser. 173, Class R, 9.00%, 11/15/21		23
	—	7	Ser. 173, Class RS, 9.103%, 11/15/21		23
	13	4	Painewebber CMO Trust, Ser. 88 M, Class 6, 13.80%, 9/01/18		—
	Total Collateralized Mortgage Obligation Residual Securities				6,786
U.S. Government and Agency Securities—9.9%
			Overseas Private Investment Corp.,
	325		4.09%, 5/29/12		307,885
	910	1	4.30%, 5/29/12		909,323
	683		4.64%, 5/29/12		692,592
	386		4.68%, 5/29/12		367,702
	2,928		4.87%, 5/29/12		2,996,217
	350	1	5.40%, 5/29/12		376,330

	Principal Amount (000)		Description	Value
U.S. Government and Agency Securities—(cont’d)
$	13,000	3	Resolution Funding Corp., Ser. B, Zero Coupon, 4/15/30	$	4,333,823
			Small Business Administration,
	612		Ser. 20C-1, 7.15%, 3/01/17		634,079
	616		Ser. 20E-1, 7.60%, 5/01/16		638,742
	816		Ser. 20F-1, 7.55%, 6/01/16		846,061
	560		Ser. 20G-1, 7.70%, 7/01/16		582,014
	833		Ser. 20H-1, 7.25%, 8/01/16		862,324
	1,492		Ser. 20K-1, 6.95%, 11/01/16		1,538,213
	60,000	3	U.S. Treasury Strip, Zero Coupon, 11/15/24		26,123,880
			Total U.S. Government and Agency Securities		41,209,185
Corporate Bond—0.6%
	2,448	4	Structured Asset Receivable Trust, 5.68%, 1/21/10		2,423,798
Commercial Mortgage-Backed Securities—1.5%
	2,420	1	Credit Suisse Mortgage Capital Certificates, Ser. C2, Class A3, 5.542%, 1/15/49		2,394,680
	3,500		First Union Commercial Mortgage Securities, Inc., Ser. C2, Class D, 7.12%, 11/18/29		3,757,506
			Total Commercial Mortgage-Backed Securities		6,152,186
Asset-Backed Securities—1.7%
	5,890	1	First Franklin Mortgage Loan Asset Backed Certificates, Ser. FF2, Class M2, 5.313%, 3/25/35		5,414,503
	1,875	1	Securitized Asset Backed Receivables LLC Trust, Ser. OP2, Class M1, 5.303%, 10/25/35		1,730,120
			Total Asset-Backed Securities		7,144,623
			Total Long-Term Investments (cost $444,968,496)		437,744,481
SHORT-TERM INVESTMENT—0.4%
U.S. Government and Agency Discount Notes—0.4%
	1,600	9	Federal Home Loan Bank Disc. Notes, 4.401%, 11/01/07 (cost $1,600,000)		1,600,000
BORROWED BOND AGREEMENT—8.3%
	34,721	11	Lehman Brothers, Inc., 4.64%, 11/08/07 (cost $34,720,656)		34,720,656

	Notional Amount (000)
OUTSTANDING OPTIONS PURCHASED—2.2%
		Interest Rate Swaps,
	7,300	Trust pays 3-month LIBOR, Trust receives 5.39%, expires 3/19/12	296,161
	31,965	Trust pays 3-month LIBOR, Trust receives 5.495%, expires 5/08/12	1,394,313
	5,500	Trust pays 3-month LIBOR, Trust receives 5.52%, expires 9/21/36	324,406
	31,965	Trust pays 3-month LIBOR, Trust receives 5.725%, expires 5/24/12	1,253,348
	2,800	Trust pays 3-month LIBOR, Trust receives 5.78%, expires 8/09/10	148,512
	8,640	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	531,187
	8,640	Trust pays 3-month LIBOR, Trust receives 6.025%, expires 6/08/12	272,765
	7,300	Trust pays 5.39%, Trust receives 3-month LIBOR, expires 3/19/12	357,116
	12,400	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	531,960
	12,400	Trust pays 5.47%, Trust receives 3-month LIBOR, expires 5/08/12	579,700
	31,965	Trust pays 5.495%, Trust receives 3-month LIBOR, expires 5/08/12	1,467,833
	5,500	Trust pays 5.52%, Trust receives 3-month LIBOR, expires 9/21/36	373,168

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	30

Portfolio of Investments as of October 31, 2007	BlackRock Income Trust Inc. (BKT) (concluded)
	(Percentages shown are based on Net Assets)

	Notional Amount (000)	Description	Value
OUTSTANDING OPTIONS PURCHASED—(cont’d)
	31,965	Trust pays 5.725%, Trust receives 3-month LIBOR, expires 5/24/12	$	1,625,420
	2,800	Trust pays 5.78%, Trust receives 3-month LIBOR, expires 8/09/10		77,446
		Total Outstanding Options Purchased (cost $8,039,528)		9,233,335
		Total Investments before borrowed bonds, TBA sale commitments, and outstanding options written (cost $489,328,68010)		483,298,472

	Principal Amount (000)
BORROWED BOND—(8.5)%
$	(34,505	)	U.S. Treasury Notes, 4.75%, 5/31/12 (proceeds $34,289,344)	(35,402,682	)
TBA SALE COMMITMENTS—(12.1)%
			Federal National Mortgage Assoc.,
	(19,800	)	5.00%, 11/13/37	(18,989,428	)
	(15,900	)	5.50%, 11/13/37	(15,666,460	)
	(16,000	)	6.00%, 11/13/37	(16,115,008	)
			Total TBA Sale Commitments (proceeds $49,863,740)	(50,770,896	)

	Contracts/ Notional Amount (000)
OUTSTANDING OPTIONS WRITTEN—(2.7)%
	(23	)	Eurodollar Future, expiring 12/17/07	(28,125	)
	(38	)	Eurodollar Future, expiring 3/17/08 Interest Rate Swaps,	(56,437	)
	(5,700	)	Trust pays 3-month LIBOR, Trust receives 5.135%, expires 4/21/08	(97,385	)
	(7,300	)	Trust pays 3-month LIBOR, Trust receives 5.148%, expires 3/19/08	(119,063	)
	(19,500	)	Trust pays 3-month LIBOR, Trust receives 5.448%, expires 5/07/10	(1,299,480	)
	(3,800	)	Trust pays 3-month LIBOR, Trust receives 5.46%, expires 8/22/08	(52,272	)
	(5,400	)	Trust pays 3-month LIBOR, Trust receives 5.485%, expires 10/28/19	(158,647	)
	(12,400	)	Trust pays 3-month LIBOR, Trust receives 5.67%, expires 1/04/10	(315,828	)
	(19,495	)	Trust pays 3-month LIBOR, Trust receives 5.685%, expires 5/24/10	(1,024,462	)
	(63,930	)	Trust pays 3-month LIBOR, Trust receives 5.88%, expires 6/23/08	(3,831,325	)
	(7,300	)	Trust pays 5.115%, Trust receives 3-month LIBOR, expires 3/19/08	(118,698	)
	(5,700	)	Trust pays 5.135%, Trust receives 3-month LIBOR, expires 4/21/08	(97,385	)
	(19,500	)	Trust pays 5.448%, Trust receives 3-month LIBOR, expires 5/07/10	(1,241,955	)
	(3,800	)	Trust pays 5.46%, Trust receives 3-month LIBOR, expires 8/22/08	(131,135	)
	(5,400	)	Trust pays 5.485%, Trust receives 3-month LIBOR, expires 10/28/19	(212,156	)
	(12,400	)	Trust pays 5.67%, Trust receives 3-month LIBOR, expires 1/04/10	(599,912	)

	Notional Amount (000)		Description	Value
OUTSTANDING OPTIONS WRITTEN—(cont’d)
	(19,495	)	Trust pays 5.685%, Trust receives 3-month LIBOR, expires 5/24/10	$	(1,567,203	)
	(63,930	)	Trust pays 5.88%, Trust receives 3-month LIBOR, expires 6/23/08		(265,310	)
			Total Outstanding Options Written (premium received $9,904,416)		(11,216,778	)
Total investments net of borrowed bonds, TBA sale commitments and outstanding options written—92.4%				$	385,908,116
Other assets in excess of liabilities—7.6%					31,742,835
Net Assets—100%				$	417,650,951

1	Variable rate security. Rate shown is interest rate as of October 31, 2007.
2	Security, or a portion thereof, pledged as collateral with a value of $6,412,510 on 123 long U.S. Treasury Note futures contracts expiring December 2007, 686 short Eurodollar futures contracts expiring December 2007 to September 2009, 3,506 short U.S. Treasury Note futures contracts expiring December 2007 and 463 short U.S. Treasury Bond futures contracts expiring December 2007. The notional value of such contracts on October 31, 2007 was $756,077,952, with an unrealized loss of $4,500,487.
3	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
4	Illiquid security. As of October 31, 2007, the Trust held 0.7% of its net assets, with a current market value of $2,789,604, in these securities.
5	Represents an investment in an affiliate.
6	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 0.2% of its net assets, with a current market value of $775,270, in securities restricted as to resale.
7	Security is fair valued.
8	Rate shown is effective yield of the underlying collateral as of October 31, 2007.
9	Rate shown is the yield to maturity as of the date of purchase.
10	Cost for federal income tax purposes is $489,476,259. The net unrealized depreciation on a tax basis is $6,177,787, consisting of $21,888,429 gross unrealized appreciation and $28,066,216 gross unrealized depreciation.
11	See Note 1 in the Notes to Financial Statements for details of borrowed bond agreements.

See Notes to Financial Statements.
31	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
LONG-TERM INVESTMENTS—133.7%
Corporate Bonds—49.1%
Aerospace & Defense—1.5%
$	1,560	1	AAR Corp., Ser. A2, 8.39%, 5/15/11	$	1,575,600
	745	2	Bombardier, Inc., 8.00%, 11/15/14 (Canada)		774,800
	5,236		DI Finance/DynCorp Intl., Ser. B, 9.50%, 2/15/13		5,563,250
			DRS Technologies, Inc.,
	330		6.875%, 11/01/13		330,000
	310		7.625%, 2/01/18		316,975
	755		Sequa Corp., 9.00%, 8/01/09		809,737
	570		TransDigm, Inc., 7.75%, 7/15/14		579,975
			Total Aerospace & Defense		9,950,337
Automotive—2.4%
	850		Accuride Corp., 8.50%, 2/01/15		799,000
			AutoNation, Inc.,
	690		7.00%, 4/15/14		667,575
	690	3	7.243%, 4/15/13		674,475
	7,500	4	DaimlerChrysler NA Holding Corp., 4.05%, 6/04/08		7,439,415
	500		Ford Capital BV, 9.50%, 6/01/10 (Netherlands)		503,750
	1,575		Lear Corp., Ser. B, 8.75%, 12/01/16		1,512,000
	1,000	4	Metaldyne Corp., 11.00%, 11/01/13		930,000
	3,500		Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13		3,535,000
			Total Automotive		16,061,215
Basic Materials—3.9%
	1,405		Abitibi-Consolidated, Inc., 6.00%, 6/20/13 (Canada)		1,032,675
	2,200		AK Steel Corp., 7.75%, 6/15/12		2,244,000
	1,100		American Pacific Corp., 9.00%, 2/01/15		1,127,500
	670	3	Bowater, Inc., 8.694%, 3/15/10		613,050
	120		Chemtura Corp., 6.875%, 6/01/16		114,600
	750		CPG Intl. I, Inc., 10.50%, 7/01/13		750,000
			Domtar, Inc., (Canada)
	300		7.125%, 8/15/15		297,000
	140		7.875%, 10/15/11		143,850
			Freeport-McMoRan Copper & Gold, Inc.,
	4,585	4	8.375%, 4/01/17		5,020,575
	750	3	8.394%, 4/01/15		774,375
			Huntsman LLC,
	1,950	4	11.625%, 10/15/10		2,067,000
	310		12.00%, 7/15/12		337,125
			Ineos Group Holdings Plc (United Kingdom)
	1,490		7.875%, 2/07/16 (EUR)		1,985,671
	2,885	2	8.50%, 2/15/16		2,740,750
	2,225		Innophos, Inc., 8.875%, 8/15/14		2,241,687
	980	2	Key Plastics LLC/Key Plastics Finance Corp., 11.75%, 3/15/13		833,000
	560		Lyondell Chemical Co., 10.50%, 6/01/13		603,400
			NewPage Corp.,
	810		10.00%, 5/01/12		856,575
	1,500	3,4	11.161%, 5/01/12		1,616,250
	300		12.00%, 5/01/13		324,000
	500	3	NOVA Chemicals Corp., 8.484%, 11/15/13 (Canada)		491,250
	730		Terra Capital, Inc., Ser. B, 7.00%, 2/01/17		730,000
			Total Basic Materials		26,944,333
Building & Development—0.9%
	3,000	4	DR Horton, Inc., 5.875%, 7/01/13		2,688,714
			Goodman Global Holding Co., Inc.,
	2,000		7.875%, 12/15/12		2,090,000
	269	3	8.36%, 6/15/12		270,345
	665		Nortek, Inc., 8.50%, 9/01/14		588,525
	270		North American Energy Partners, Inc., 8.75%, 12/01/11 (Canada)		272,700
			Total Building & Development		5,910,284

	Principal Amount (000)		Description	Value
Commercial Services—0.2%
$	350		FTI Consulting, Inc., 7.75%, 10/01/16	$	365,750
	875	2	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		853,125
			Total Commercial Services		1,218,875
Consumer Products—5.0%
	2,085	3	Ames True Temper, Inc., 9.243%, 1/15/12		2,001,600
	130	3	Avis Budget Car Rental LLC/Avis Budget Finance, Inc., 8.058%, 5/15/14		128,375
			General Nutrition Centers, Inc.,
	2,250		9.85%, 3/15/14		2,165,625
	1,880		10.75%, 3/15/15		1,828,300
	5,000	4	Group 1 Automotive, Inc., 8.25%, 8/15/13		5,000,000
	4,400	4	JCPenney Co., Inc., 8.00%, 3/01/10		4,687,540
	1,475		Lazy Days RV Center, Inc., 11.75%, 5/15/12		1,327,500
			Michaels Stores, Inc.,
	2,210		10.00%, 11/01/14		2,226,575
	2,800	4	11.375%, 11/01/16		2,793,000
	73		Neiman-Marcus Group, Inc., 9.00%, 10/15/15		77,015
	575		Quiksilver, Inc., 6.875%, 4/15/15		536,187
	1,000	4	Reynolds American, Inc., 7.625%, 6/01/16		1,081,917
			Rite Aid Corp.,
	3,440	4	7.50%, 3/01/17		3,199,200
	5,000	4	8.125%, 5/01/10		5,031,250
	1,790	4	Sally Holdings LLC, 10.50%, 11/15/16		1,781,050
			Total Consumer Products		33,865,134
Containers & Packaging—1.0%
			Berry Plastics Holding Corp.,
	1,210		8.875%, 9/15/14		1,240,250
	835	3	9.569%, 9/15/14		837,087
	885		Crown Americas LLC/Crown Americas Capital Corp., 7.75%, 11/15/15		911,550
	585		Graham Packaging Co., Inc., 8.50%, 10/15/12		580,613
	1,370	2,3	Impress Holdings BV, 8.368%, 9/15/13 (Netherlands)		1,362,813
	2,020		Pregis Corp., 12.375%, 10/15/13		2,201,800
			Total Containers & Packaging		7,134,113
Ecological Services & Equipment—0.6%
	2,000		Casella Waste Systems, Inc., 9.75%, 2/01/13		2,040,000
	2,065		Waste Services, Inc., 9.50%, 4/15/14		2,065,000
			Total Ecological Services & Equipment		4,105,000
Energy—4.9%
	5,500	2	AES Corp., 8.75%, 5/15/13		5,816,250
	550		Berry Petroleum Co., 8.25%, 11/01/16		561,000
	1,210		Chaparral Energy, Inc., 8.50%, 12/01/15		1,128,325
			Chesapeake Energy Corp.,
	650		6.375%, 6/15/15		630,500
	100		6.875%, 11/15/20		97,750
	4,000	4	7.50%, 9/15/13		4,110,000
			Compagnie Generale de Geophysique-Veritas (France)
	255		7.50%, 5/15/15		260,100
	420		7.75%, 5/15/17		432,600
	925		Compton Petroleum Finance Corp., 7.625%, 12/01/13 (Canada)		885,687
	1,640	1	East Cameron Gas Co., 11.25%, 7/09/19 (Cayman Islands)		1,574,400
	590		Edison Mission Energy, 7.50%, 6/15/13		598,113
	400		El Paso Natural Gas Co., 8.875%, 6/15/32		466,279
	159		Elwood Energy LLC, 8.159%, 7/05/26		162,789
			Encore Acquisition Co.,
	250		6.00%, 7/15/15		226,250
	200		7.25%, 12/01/17		191,500
	495		Exco Resources, Inc., 7.25%, 1/15/11		488,813
	380	4	Grant Prideco, Inc., Ser. B, 6.125%, 8/15/15		381,900
	895		KCS Energy, Inc., 7.125%, 4/01/12		881,575
	4,324	4	Midwest Generation LLC, Ser. B, 8.56%, 1/02/16		4,648,585
	625		Mirant Americas Generation LLC, 8.30%, 5/01/11		632,031

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	32

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (continued)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
Energy—(cont’d)
			NRG Energy, Inc.,
$	210		7.25%, 2/01/14	$	210,000
	1,185		7.375%, 2/01/16		1,182,037
	1,990	2	OPTI, Inc., 8.25%, 12/15/14 (Canada)		1,994,975
	580		Orion Power Holdings, Inc., 12.00%, 5/01/10		640,900
	1,515		Sabine Pass LNG LP, 7.50%, 11/30/16		1,484,700
	1,240	2	SemGroup LP, 8.75%, 11/15/15		1,190,400
	725	2	Targa Resources, Inc., 8.50%, 11/01/13		732,250
	1,550		Whiting Petroleum Corp., 7.25%, 5/01/12-5/01/13		1,523,675
			Total Energy		33,133,384
Entertainment & Leisure—0.4%
	505		AMC Entertainment, Inc., 11.00%, 2/01/16		546,663
	1,430	2	Greektown Holdings LLC, 10.75%, 12/01/13		1,422,850
	1,020		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		752,250
	100		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., 6.625%, 12/01/14		98,250
			Total Entertainment & Leisure		2,820,013
Financial Institutions—5.2%
			American Real Estate Partners LP/American Real Estate
			Finance Corp.,
	1,480		7.125%, 2/15/13		1,443,000
	5,860	4	8.125%, 6/01/11		5,903,950
	839	2,3	BMS Holdings, Inc., 12.40%, 2/15/12		805,682
			Ford Motor Credit Co. LLC,
	2,800		7.375%, 2/01/11		2,640,938
	1,665		7.80%, 6/01/12		1,564,392
	940	3	7.993%, 1/13/12		870,229
	60	3	9.693%, 4/15/12		60,570
	2,735	4	General Motors Acceptance Corp., 6.875%, 8/28/12		2,465,586
	3,716	2	iPayment Investors LP, 11.625%, 7/15/14		3,827,972
	950		iPayment, Inc., 9.75%, 5/15/14		912,000
			LVB Acquisition Merger Sub, Inc.,
	500	2	10.00%, 10/15/17		513,750
	500	2	10.375%, 10/15/17		506,250
	670	2	11.625%, 10/15/17		682,563
	2,590	2	Momentive Performance Materials, Inc., 11.50%, 12/01/16		2,499,350
			Rainbow National Services LLC,
	925	2	8.75%, 9/01/12		962,000
	3,134	2	10.375%, 9/01/14		3,447,400
	4,410	5	Structured Asset Receivable Trust, 5.68%, 1/21/10		4,365,591
	220	3	Universal City Florida Holding Co. I/II, 9.661%, 5/01/10		224,950
	2,780	2	Wimar Opco LLC/Wimar Opco Finance Corp., 9.625%, 12/15/14		2,085,000
			Total Financial Institutions		35,781,173
Health Care—1.1%
	3,000		Norcross Safety Products LLC/Norcross Capital Corp., 9.875%, 8/15/11		3,112,500
	1,985		Tenet Healthcare Corp., 6.50%, 6/01/12		1,682,288
	2,948	2	Viant Holdings, Inc., 10.125%, 7/15/17		2,771,120
			Total Health Care		7,565,908
Industrials—1.4%
	1,700	2	AGY Holding Corp., 11.00%, 11/15/14		1,674,500
	650		Hexcel Corp., 6.75%, 2/01/15		638,625
	905		Park-Ohio Industries, Inc., 8.375%, 11/15/14		843,913
			RBS Global, Inc./Rexnord Corp.,
	2,000		9.50%, 8/01/14		2,065,000
	1,430		11.75%, 8/01/16		1,515,800
	3,125	2	Sunstate Equipment Co. LLC, 10.50%, 4/01/13		3,000,000
			Total Industrials		9,737,838
Media—8.6%
			Affinion Group, Inc.,
	1,975		10.125%, 10/15/13		2,058,937
	850		11.50%, 10/15/15		886,125
	420		American Media Operations, Inc., Ser. B, 10.25%, 5/01/09		402,150

	Principal Amount (000)		Description	Value
Media—(cont’d)
$	800	3	Cablevision Systems Corp., Ser. B, 9.644%, 4/01/09	$	822,000
	520		CanWest MediaWorks, Inc., 8.00%, 9/15/12 (Canada)		507,000
	1,395		Charter Communications Holdings I LLC/Charter Communications Holdings I Capital Corp., 11.00%, 10/01/15		1,353,150
	2,880		Charter Communications Holdings II LLC/Charter Communications Holdings II Capital Corp., 10.25%, 9/15/10		2,937,600
	865		Ser. B, 10.25%, 9/15/10		880,138
	2,425		CMP Susquehanna Corp., 9.875%, 5/15/14		2,227,969
	6,685	4	Comcast Cable Communications, Inc., 6.875%, 6/15/09		6,854,899
	1,650		Dex Media West LLC/Dex Media Finance Co., Ser. B, 9.875%, 8/15/13		1,759,313
	500		DirecTV Holdings LLC/DirecTV Financing Co., 8.375%, 3/15/13		522,500
			EchoStar DBS Corp.,
	2,800		5.75%, 10/01/08		2,793,000
	1,330		7.00%, 10/01/13		1,384,863
	200		7.125%, 2/01/16		209,000
	2,525		Idearc, Inc., 8.00%, 11/15/16		2,531,312
	2,000	2,3	ION Media Networks, Inc., 8.493%, 1/15/12		2,005,000
	2,105		Network Communications, Inc., 10.75%, 12/01/13		2,118,156
	2,790		Nexstar Finance, Inc., 7.00%, 1/15/14		2,678,400
			Nielsen Finance LLC/Nielsen Finance Co.,
	1,400	6	9.115%, 8/01/16		1,011,500
	4,340		10.00%, 8/01/14		4,567,850
	3,465		RH Donnelley Corp., Ser. A-3, 8.875%, 1/15/16		3,465,000
	2,000		Salem Communications Corp., 7.75%, 12/15/10		2,007,500
	460		Sinclair Broadcast Group, Inc., 4.875%, 7/15/18		417,019
	185		Sirius Satellite Radio, Inc., 9.625%, 8/01/13		183,844
	4,500	2	TL Acquisitions, Inc., 10.50%, 1/15/15		4,477,500
	1,465	2	Univision Communications, Inc., 9.75%, 3/15/15		1,435,700
	2,390		Vertis, Inc., 9.75%, 4/01/09		2,390,000
	4,342		Young Broadcasting, Inc., 10.00%, 3/01/11		4,081,480
			Total Media		58,968,905
Real Estate—0.3%
	2,000	3	Rouse Co., 5.375%, 11/26/13		1,812,352
Technology—2.6%
			Amkor Technology, Inc.,
	2,063		7.75%, 5/15/13		1,995,952
	600		9.25%, 6/01/16		613,500
	1,965	4	Celestica, Inc., 7.625%, 7/01/13 (Canada)		1,886,400
			Freescale Semiconductor, Inc.,
	3,015		9.125%, 12/15/14		2,728,575
	600	3	9.569%, 12/15/14		551,250
	1,625		NXP BV/NXP Funding LLC, 9.50%, 10/15/15 (Netherlands)		1,535,625
	1,835	4	Sanmina-SCI Corp., 8.125%, 3/01/16		1,610,213
			SunGard Data Systems, Inc.,
	590		9.125%, 8/15/13		601,800
	2,600		10.25%, 8/15/15		2,710,500
	3,765		Superior Essex Communications LLC/Essex Group, Inc., 9.00%, 4/15/12		3,717,937
			Total Technology		17,951,752
Telecommunications—7.9%
	1,420		Cincinnati Bell, Inc., 7.25%, 7/15/13		1,423,550
	990		Cricket Communications, Inc., 9.375%, 11/01/14		982,575
	5,000	4	Deutsche Telekom Intl. Finance BV, 8.00%, 6/15/10 (Netherlands)		5,361,380
			Digicel Group Ltd. (Bermuda)
	1,120	2	8.875%, 1/15/15		1,045,856
	2,797	2	9.125%, 1/15/15		2,611,856
	860	3	Hawaiian Telcom Communications, Inc., Ser. B, 10.318%, 5/01/13		870,750
	2,495		Intelsat Corp., 9.00%, 6/15/16		2,551,138

See Notes to Financial Statements.
33	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (continued)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
Telecommunications—(cont’d)
			Intelsat Ltd. (Bermuda)
$	415	3	8.886%, 1/15/15	$	421,225
	1,800		9.25%, 6/15/16		1,867,500
	630		11.25%, 6/15/16		677,250
	2,815	3	11.409%, 6/15/13		2,934,637
	1,470		Intelsat Subsidiary Holding Co. Ltd., 8.625%, 1/15/15 (Bermuda)		1,492,050
	500	2	MetroPCS Wireless, Inc., 9.25%, 11/01/14		496,250
	3,850	2	Nordic Telephone Co. Holdings A.p.S., 8.875%, 5/01/16 (Denmark)		4,071,375
	3,300	2,3	Nortel Networks Ltd., 9.493%, 7/15/11 (Canada)		3,258,750
	3,517		PanAmSat Corp., 9.00%, 8/15/14		3,587,340
	3,287	2,3	ProtoStar I Ltd., 12.50%, 10/15/12 (Bermuda)		3,451,615
	1,364	3	Qwest Communications Intl., Inc., 9.058%, 2/15/09		1,370,820
			Qwest Corp.,
	1,000		7.875%, 9/01/11		1,055,000
	2,500	3	8.944%, 6/15/13		2,665,625
	2,675	4	9.125%, 3/15/12		2,929,125
	3,595		West Corp., 11.00%, 10/15/16		3,765,762
	1,500	2	Wind Acquisition Finance S.A., 10.75%, 12/01/15 (Luxembourg)		1,668,750
			Windstream Corp.,
	2,340	4	8.125%, 8/01/13		2,474,550
	1,060		8.625%, 8/01/16		1,134,200
			Total Telecommunications		54,168,929
Transportation—1.2%
	520		American Airlines, Inc., Ser. 99-1, 7.324%, 4/15/11		513,500
	490		Britannia Bulk Plc, 11.00%, 12/01/11 (United Kingdom)		514,500
	1,715		CHC Helicopter Corp., 7.375%, 5/01/14 (Canada)		1,659,263
	2,150		Navios Maritime Holdings, Inc., 9.50%, 12/15/14 (Marshall Islands)		2,273,625
	1,650		Overseas Shipholding Group, Inc., 8.75%, 12/01/13		1,769,625
	1,900	2	St. Acquisition Corp., 12.50%, 5/15/17		1,211,250
			Total Transportation		7,941,763
			Total Corporate Bonds		335,071,308
Bank Loans—56.5%
Aerospace & Defense—0.3%
	1,750		DI Finance/DynCorp Intl., Loan B,
			LIBOR + 2.00%, 2/11/11		1,675,789
	486		Wesco Aircraft Hardware Corp., First Lien Loan, LIBOR + 2.25%, 9/29/13		480,375
			Total Aerospace & Defense		2,156,164
Automotive—1.7%
	637		IAP Worldwide Services, Inc., First Lien Loan, LIBOR + 6.25%, 12/30/12		571,731
	1,489		Keystone Automotive Industries, Inc., Loan B, LIBOR + 3.50%, 1/12/12		1,385,778
	964		Mark IV Industries, Inc., First Lien Loan, LIBOR + 2.50%, 6/21/11		927,972
	765		Metaldyne Corp., LIBOR , 1/11/14		745,875
	496		Motorsport Aftermarket Group, Inc., LIBOR + 2.50%, 11/30/13		477,641
			Navistar Intl. Corp.,
	1,000		Revolver Loan, Unfunded, 0.50%, 1/19/12		980,750
	2,750		LIBOR + 3.25%, 1/19/12		2,697,062
	921		Rent-A-Center, Inc., Loan B, LIBOR + 1.75%, 6/30/12		899,519
			Reynolds & Reynolds Co.,
	1,870		LIBOR + 2.00%, 10/26/12		1,821,930
	1,250		Second Lien Loan, LIBOR + 5.50%, 10/26/13		1,246,875
			Total Automotive		11,755,133

	Principal Amount (000)	Description	Value
Basic Materials—2.6%
$	998	Appleton Papers, Inc., Loan B, LIBOR + 1.75%, 6/05/14	$	956,977
	499	BOC Edwards, LIBOR + 2.00%, 5/31/14		466,331
		Brenntag Holdings (EUR)
	282	Loan B6, LIBOR + 2.00%, 9/15/14		390,878
	218	Loan B6b, LIBOR + 2.00%, 9/15/14		302,615
	1,000	Cognis Group, LIBOR, 11/17/13 (EUR)		1,391,641
	786	Compass Minerals Group, Inc., LIBOR + 1.50%, 12/22/12		773,060
	550	Huntsman Intl. LLC, Loan B, LIBOR + 1.75%, 4/19/14		545,102
		Ineos Group Holdings Plc,
	1,241	Loan A4, LIBOR + 2.25%, 12/16/12		1,210,496
	1,682	Loan B2, LIBOR + 2.25%, 12/16/13		1,664,679
	1,682	Loan C2, LIBOR + 2.75%, 12/23/14		1,664,223
		Invista BV,
	1,283	Loan B1, LIBOR + 1.50%, 4/29/11		1,259,879
	680	Loan B2, LIBOR + 1.50%, 4/29/11		667,829
	1,496	ISP Chemco LLC, Loan B, LIBOR + 1.75%, 6/04/14		1,459,218
	1,151	John Maneely Co., Loan B, LIBOR + 3.25%, 12/08/13		1,065,305
	1,562	Nalco Co., Loan B, LIBOR + 1.75%, 11/04/10		1,551,152
	975	Rockwood Specialties Group, Inc., Loan E, LIBOR + 1.50%, 12/13/13		957,694
	1,611	SP Newsprint, Loan B, LIBOR + 3.75%, 1/09/10		1,562,778
		Total Basic Materials		17,889,857
Building & Development-2.0%
	196	Armstrong World Industries, Inc., LIBOR + 1.75%, 10/02/13		194,045
	1,238	Beacon Roofing Supply, Inc., Loan B, LIBOR + 2.00%, 9/30/13		1,175,625
		Brand Energy & Infrastructure Services, Inc.,
	498	First Lien Loan B, LIBOR + 2.25%, 2/07/14		474,698
	500	Second Lien Loan, LIBOR + 6.00%, 2/07/15		477,917
	2,481	Building Materials Holding Corp., PRIME + 1.75%, 3/15/14		2,238,485
	1,500	Custom Building Products, Inc., Second Lien Loan, LIBOR + 5.00%, 4/29/12		1,380,000
	250	Euramax Intl., Inc., Second Lien Loan, LIBOR + 8.00% , 6/29/13		212,908
	1,500	Hanley Wood LLC, LIBOR + 2.25%, 3/08/14		1,233,750
		Lafarge Roofing Holdings, Inc.,
	725	Loan B1, LIBOR + 2.13%, 2/28/14 (EUR)		955,310
	296	Loan B2, LIBOR + 2.13%, 2/28/14 (EUR)		390,196
	278	Loan B4, LIBOR + 0.00%, 2/28/14		251,415
	673	Loan C1, LIBOR, 2/28/15 (EUR)		890,852
	346	Loan C2, LIBOR, 2/28/15 (EUR)		458,268
	285	Loan C4, LIBOR, 2/28/15		258,886
	494	Nacco Industries, Inc., Unfunded, 0.25%, 3/21/13		475,234
	485	Nortek, Inc., Loan B, PRIME + 1.25%, 8/27/11		472,875
	800	Rhodes Ranch, First Lien Loan, LIBOR + 3.50%, 11/21/10		724,000
	1,870	United Subcontractors, Inc., First Lien Loan, LIBOR + 3.00%, 12/27/12		1,533,469
		Total Building & Development		13,797,933
Conglomerates—1.3%
		Atlantis Plastics, Inc.,
	975	First Lien Loan, LIBOR + 4.00%, 9/22/11		809,250
	250	Second Lien Loan, LIBOR + 9.00%, 3/22/12		207,500
	891	Blount Intl., Loan B, PRIME, 8/09/10		870,631
	1,946	Colfax Corp., Loan B, LIBOR + 2.25%, 5/30/09		1,923,989
		Invensys Plc,
	1,000	Loan A, LIBOR + 2.00%, 12/15/11		975,000
	1,000	Loan B, LIBOR + 2.13%, 12/15/11 (GBP)		2,042,913
	1,122	Sensus Metering Systems, Inc., Loan B1, LIBOR + 2.00%, 12/17/10		1,099,304
	722	St. John Knits Intl., Inc., Loan B, LIBOR + 3.00%, 3/21/12		707,649
		Total Conglomerates		8,636,236

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	34

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (continued)
	(Percentages shown are based on Net Assets)

	Principal Amount (000)		Description	Value
Consumer Products—8.1%
$	1,000		Aearo Technologies, Inc., Second Lien Loan, LIBOR + 5.50%, 12/01/14	$	965,000
	985		24 Hour Fitness Worldwide, Inc., Loan B, LIBOR + 2.50%, 6/08/12		965,300
			Advance Food Co.,
	774		Loan B, PRIME + 0.75%, 3/16/14		739,064
	222		TBD, Unfunded, 3/16/14		212,222
	750		American Safety Razor Co., Second Lien Loan, LIBOR + 6.25%, 1/30/14		746,250
			ARAMARK Corp.,
	178		Letter of Credit, LIBOR + 2.00%, 1/26/14		173,305
	2,487		Loan B, LIBOR + 2.00%, 1/26/14		2,424,837
	448		Arby’s Restaurant Group, Inc., Loan B, LIBOR + 2.25%, 7/25/12		438,529
	390		Bare Escentuals Beauty, Inc., First Lien Loan, LIBOR + 2.25%, 2/18/12		384,738
			Berkline Bench Craft,
	94	7	Loan B, PRIME + 2.75%, 11/03/11		54,230
	1,005	7	Second Lien Loan, TBD, 5/11/12		50,252
	1,244		Brickman Group Ltd., LIBOR + 2.00%, 1/23/14		1,206,438
	1,011		Burlington Coat Factory Warehouse Corp., Loan B, LIBOR + 2.25%, 5/28/13		945,381
	1,090		Central Garden & Pet Co., Loan B, PRIME + 0.75%, 9/30/12		991,792
			Cenveo Corp.,
	31		Delayed Draw Loan, LIBOR + 1.75%, 6/21/13		29,806
	923		Loan C, LIBOR + 1.75%, 6/21/13		896,921
	435		Chiquita Brands Intl., Inc., Loan C, LIBOR + 3.00%, 6/28/12		427,253
	1,245		Claire’s Stores, Inc., Loan B, LIBOR + 2.75%, 5/29/14		1,169,912
	993		Coinmach Corp., Loan B1, Unfunded, 1.25%, 12/19/12		985,492
	2,209		Cracker Barrel, Loan B, LIBOR + 1.50%, 4/27/13		2,144,617
	1,500		Culligan International Co., Second Lien Loan, LIBOR, 4/24/13 (EUR)		1,912,085
	995		David’s Bridal, Inc., LIBOR + 2.00%, 1/31/14		937,788
			Dole Food Co., Inc.,
	468		Letter of Credit, LIBOR, 4/12/13		453,863
	1,038		LIBOR + 2.00%, 4/12/13		1,005,873
	3,460		Loan C, LIBOR + 2.00%, 4/12/13		3,352,910
	500		DS Waters Holdings, Inc., Loan B, LIBOR, 3/07/12		486,250
	1,936		Eight O’Clock Coffee, First Lien Loan, LIBOR + 2.75%, 11/14/11		1,935,747
	672		FTD, Inc., LIBOR + 2.00%, 7/28/13		664,045
	350		Gold Toe, Second Lien Loan, LIBOR + 6.00%, 4/30/14		343,000
	1,938		JRD Holdings, Inc., LIBOR + 2.50%, 5/11/14		1,889,063
	780		Language Line, Inc., Loan B1, LIBOR + 3.25%, 6/11/11		757,381
	1,000	7	Le-Natures, Inc., Loan B, LIBOR + 4.00%, 3/01/11		577,500
	2,420		Michael Foods, Inc., Loan B1, LIBOR + 2.00%, 11/21/10		2,382,496
	1,440		Neiman-Marcus Group, Inc., LIBOR + 1.75%, 4/06/13		1,413,836
	1,330		New Page, Loan B, LIBOR + 2.25%, 5/02/11		1,313,308
	1,500		Orchard Supply Hardware Stores Corp., Loan B2, LIBOR + 2.45%, 12/09/07		1,477,500
	963		Oriental Trading Co., LIBOR + 2.25%, 7/31/13		924,585
			OSI Food Co.,
	75		Pre Funded Revolver, Unfunded, 0.50%, 6/14/13		72,256
	922		Loan B, LIBOR + 2.25%, 6/14/14		886,522
	2,910		OSI Group LLC, LIBOR + 2.00% , 9/02/11		2,829,975
	1,164		Pantry, Inc. (The), Loan B, LIBOR + 1.75%, 5/15/14		1,122,291
	397		PETCO Animal Supplies, Inc., LIBOR + 2.25%, 10/26/13		387,241
	591		Pierre Foods, Inc., Loan B, LIBOR + 4.00%, 6/30/10		580,901
	750		Pivotal Promontory LLC, Second Lien Loan, PRIME + 5.50%, 8/31/11		656,250
	1,315		Prestige Brands Holdings, Inc., Loan B, LIBOR + 2.25%, 4/06/11		1,304,701
	1,975		Quiznos Corp., First Lien Loan, LIBOR + 2.25%, 5/05/13		1,910,263

	Principal Amount (000)		Description		Value
Consumer Products—(cont’d)
			Riverdeep Interactive Learning, Inc.,
$	402		Bridge Loan, LIBOR + 7.20%, 12/21/07	$	400,179
	995		Loan B, LIBOR + 2.75%, 12/20/13		987,318
	3,650		ServiceMaster Co. (The), Bridge Loan, LIBOR + 4.50%, 6/19/08		3,371,687
			Sturm Foods, Inc.,
	1,368		LIBOR + 2.50%, 1/31/14		1,272,356
	500		Second Lien Loan, LIBOR + 7.00%, 7/21/14		458,750
	621	7	Synventive Acquisition, Inc., Mezzanine Loan, LIBOR, 1/31/14		279,656
	354		Warnaco, Inc., Loan B, LIBOR + 1.50%, 1/31/13		349,191
			Wastequip, Inc.,
	311		Delayed Draw Loan, LIBOR + 2.25%, 2/05/13		293,286
	689		Loan B, LIBOR + 2.25%, 2/05/13		649,215
			Total Consumer Products		55,590,607
Containers & Packaging—2.0%
			Bluegrass Container Co. LLC,
	364		Delayed Draw Second Lien Loan, LIBOR + 5.00%, 12/30/13		364,318
	341		First Lien Loan, LIBOR + 2.25%, 6/30/13		337,969
	1,140		Loan B, LIBOR + 2.25%, 6/30/13		1,129,527
	1,136		Second Lien Loan, LIBOR + 5.00%, 12/30/13		1,138,494
			Consolidated Container Co. LLC,
	995		First Lien Loan, LIBOR + 2.25%, 3/28/14		927,837
	750		Second Lien Loan, LIBOR, 9/28/14		648,750
	2,456		Georgia-Pacific Corp., First Lien Loan, LIBOR + 1.75%, 12/20/12		2,396,598
	4,975		Graham Packaging Co. LP, Loan B, LIBOR + 2.25%, 10/07/11		4,869,281
	568		Smurfit-Stone Container Enterprises, Inc., Unfunded, 0.50%, 11/01/10		561,259
	1,352		Solo Cup, Inc., LIBOR + 3.50%, 2/27/11		1,346,182
			Total Containers & Packaging		13,720,215
Ecological Services & Equipment—0.1%
	500		Envirosolutions, Inc., LIBOR + 3.50%, 7/07/12		470,000
	73		Sensus Metering Systems, Inc., Loan B2, LIBOR + 2.00%, 12/17/10		71,423
			Total Ecological Services & Equipment		541,423
Energy—6.0%
	429		AES Corp., LIBOR + 1.75%, 4/30/08		425,223
			Big West Oil LLC,
	550		Delayed Draw Loan, LIBOR + 1.50%, 5/15/14		528,000
	448		LIBOR + 2.25%, 5/15/14		429,600
			Coffeyville Resources LLC,
	243		Letter Of Credit, Unfunded, 0.50%, 12/29/10		240,659
	793		Loan D, PRIME + 3.25%, 12/28/13		784,872
			Coleto Creek Power,
	127		Letter of Credit, LIBOR + 2.85%, 6/28/13		125,000
	1,849		Loan B, LIBOR + 2.75%, 6/28/13		1,814,531
	1,485		Dresser, Inc., Loan B, LIBOR + 2.50%, 5/04/14		1,452,233
			ElectricInvest Holding Co. Ltd.,
	894		LIBOR + 4.00% , 12/21/12 (EUR)		1,250,814
	900		LIBOR + 4.00% , 12/21/12 (GBP)		1,808,212
	2,000		Flint, Loan B9, LIBOR, 11/09/14		1,922,500
			Generac Power Systems, Inc.,
	990		First Lien Loan, PRIME + 1.50%, 11/09/13		868,372
	500		Second Lien Loan, PRIME + 5.00%, 5/10/14		358,959
	1,474		Key Energy Services, Inc., Loan C, LIBOR + 2.50%, 6/30/12		1,467,302
			MACH Gen LLC,
	70		Letter Of Credit, Unfunded, 0.50%, 2/22/13		67,887
	675		LIBOR + 2.00%, 2/22/14		651,316
	496		McJunkin Corp., Loan B, LIBOR + 3.25%, 1/31/13		493,459
	493		MEG Energy Corp., Loan B, LIBOR + 2.00%, 4/03/13		481,788

See Notes to Financial Statements.
35	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Energy—(cont’d)
			Northeast Energy,
$	159		Letter of Credit, LIBOR + 2.50%, 11/01/13	$	152,988
	1,297		Loan B, LIBOR + 2.50%, 11/01/13		1,251,802
	250		Second Lien Loan, LIBOR + 4.50%, 5/01/14		236,875
	1,995		Safenet, Inc., Loan B, LIBOR, 4/12/14		1,895,250
			SandRidge Energy, Inc.,
	1,500		LIBOR, 4/01/14		1,485,000
	1,500		TBD, 4/01/15		1,485,000
	15,000		Texas Competitive Electric Holdings Co. LLC, TBD, 10/10/14		14,997,424
			TPF Generation Holdings LLC,
	151		Letter of Credit, LIBOR + 2.10%, 12/15/13		147,381
	770		Loan B, LIBOR + 2.00%, 12/15/13		753,776
	47		Revolver Loan, Unfunded, 0.50%, 12/15/13		46,201
	1,477		Trinidad Energy Services Income Trust, LIBOR + 2.50%, 5/13/11		1,462,725
	926		Western Refining, LIBOR + 1.75%, 5/30/14		906,567
			Wolf Hollow I LP,
	470		Loan B, LIBOR + 2.25%, 6/22/12		437,481
	400		Synthetic Letter of Credit, LIBOR + 2.25%, 6/22/12		372,000
	100		Synthetic Revolver Loan, LIBOR + 2.25%, 6/22/12		93,000
			Total Energy		40,894,197
Entertainment & Leisure—3.4%
			Alpha III,
	857		Loan B1, LIBOR + 2.38%, 12/31/13		837,857
	643		Loan B2, LIBOR + 2.38%, 12/31/13		628,393
	1,000		Loan D, LIBOR, 6/30/14		975,833
	1,692		CCM Merger, Inc., Loan B, LIBOR + 2.00%, 7/13/12		1,649,478
	1,107		Cinemark, Inc., Loan B, LIBOR + 1.75%, 10/05/13		1,080,323
	998		Discovery Channel, Loan B, LIBOR + 2.00%, 5/14/14		983,161
	1,980		Greektown Holdings LLC, Loan B, LIBOR + 2.75%, 12/03/12		1,900,800
			Green Valley Ranch Gaming LLC,
	479		First Lien Loan, LIBOR + 2.00%, 2/16/14		467,335
	1,000		Second Lien Loan, LIBOR + 3.25%, 8/16/14		947,500
	490		Hit Entertainment Ltd., LIBOR + 2.00%, 3/20/12		479,593
			Las Vegas Sands LLC,
	700		Delayed Draw Loan, LIBOR + 0.75%, 5/23/14		678,731
	2,294		Loan B, LIBOR + 1.75%, 5/23/14		2,224,539
	4,925		Metro-Goldwyn-Mayer Studios, Inc., Loan B, LIBOR + 3.25%, 4/08/12		4,713,634
	978		Penn National Gaming, Inc., Loan B, LIBOR + 1.75%, 10/03/12		969,818
	3,728		Travelport LLC, LIBOR + 7.00%, 3/27/12		3,584,752
			Travelport, Inc.,
	29		Letter of Credit, LIBOR + 2.25%, 8/23/13		28,354
	145		LIBOR + 2.25%, 8/23/13		141,309
	495		Wembley, Inc., First Lien Loan, LIBOR + 2.50%, 8/23/11		478,872
	413		Yellowstone Mountain Club, LIBOR + 2.38%, 9/30/10		387,781
			Total Entertainment & Leisure		23,158,063
Financial Institutions—2.9%
	984		Advantage Sales & Marketing, Inc., LIBOR + 2.00%, 3/29/13		946,694
	1,489		Alix Partners, LIBOR + 2.00%, 10/12/13		1,460,836
	990		Bankruptcy Management, LIBOR + 2.75%, 7/28/12		962,775
	925		Billing Services Group, LIBOR + 2.50%, 5/11/12 (EUR)		1,339,908
	929		BNY Convergex Group LLC, First Lien Loan, LIBOR + 3.00%, 10/02/13		913,482
	432		CCC Information Services Group, Inc., Loan B, LIBOR + 2.50%, 2/10/13		426,637
	1,238		Charter Mac, Loan B, LIBOR + 2.50%, 8/15/12		1,138,500
	743		Conseco, Inc., LIBOR + 2.00%, 10/10/13		707,544
	3,000	1	Enclave, Loan B, LIBOR, 3/01/12		2,842,680

Principal Amount (000)		Description	Value
Financial Institutions—(cont’d)
		GS Holdings Corp.,
$	52	Delayed Draw Loan, LIBOR + 1.75%, 5/12/13	$	50,662
	80	LIBOR + 1.75%, 5/13/11		77,718
	541	LIBOR + 1.75%, 5/12/13		526,878
	4,000	J.G. Wentworth LLC, First Lien Loan, LIBOR + 2.25%, 4/04/14		3,805,000
	385	Jostens, Inc., Loan C, LIBOR + 2.00%, 12/21/11		381,351
	998	Lucite Intl. Finance Plc, LIBOR + 9.00%, 7/07/13 (EUR)		1,394,644
	801	Professional Service, Inc., Loan B, LIBOR + 2.75%, 10/31/12		785,380
	496	Renfro Corp., Delayed Draw Loan, LIBOR + 3.25%, 10/05/13		485,994
	1,111	Sedgewick Claims Management Services, Inc., Loan B, LIBOR + 2.25%, 1/31/13		1,091,258
	741	Vertellus, First Lien Loan, LIBOR + 3.25%, 3/31/13		720,258
		Total Financial Institutions		20,058,199
Health Care—2.9%
		Cardinal Health, Inc.,
	1,995	Loan B, LIBOR + 2.25%, 4/15/14 (EUR)		2,600,870
	1,496	Unfunded, 2.25%, 4/10/14		1,346,625
	859	CCS Medical, Loan B, LIBOR + 3.25%, 9/30/12		834,993
		Community Health Systems, Inc.,
	340	Delayed Draw Loan, Unfunded, 0.50%, 7/25/14		332,047
	5,160	Loan B, LIBOR + 2.25%, 7/25/14		5,033,938
	250	Emdeon Business Services, LLC, Second Lien Loan, LIBOR, 5/16/14		247,500
	663	Eye Care Centers of America, Inc., LIBOR + 2.50%, 2/16/12		653,545
	1,990	Health Management Associates, Inc., PRIME + 0.75%, 2/28/14		1,897,133
	859	HealthSouth Corp., Loan B, LIBOR + 2.50%, 3/10/13		838,432
	491	National Renal Institutes, Inc., Loan B, LIBOR + 2.25%, 3/31/13		477,163
		Quintiles Transnational Corp.,
	985	First Lien Loan, LIBOR + 2.00%, 3/31/13		964,993
	250	Second Lien Loan, LIBOR + 4.00%, 3/31/14		247,500
	975	Select Medical Corp., Loan B, LIBOR + 2.00%, 2/24/12		931,531
	980	Vanguard Health Holding Co. II LLC, LIBOR + 2.25%, 9/23/11		957,508
		Warner Chilcott Corp.,
	1,722	Loan B, LIBOR + 2.00%, 1/18/12		1,692,909
	515	Loan C, LIBOR + 2.00%, 1/18/12		506,661
		Total Health Care		19,563,348
Industrials—2.7%
	987	Acosta, Inc., LIBOR + 2.25%, 7/28/13		964,047
	983	Bolthouse Farms, Inc., First Lien Loan, LIBOR + 2.25%, 12/16/12		966,534
	998	Bucyrus International, Inc., LIBOR + 1.50%, 5/04/14		985,031
		Buhrmann U.S., Inc.,
	496	Loan D, LIBOR + 2.00%, 12/31/10		490,047
	2,246	Loan D1, LIBOR + 2.00%, 12/23/10		2,218,149
	1,725	Drummond Co., Inc., LIBOR + 1.25%, 2/14/11		1,690,500
	1,496	Harland Clarke Holdings Corp., Loan B, LIBOR + 2.50%, 6/30/14		1,406,475
	1,496	Jason, Inc., LIBOR + 2.50%, 4/30/10		1,451,363
		Kion Group,
	250	Loan B, LIBOR + 2.25%, 3/15/15		245,764
	250	Loan C, LIBOR + 2.50%, 3/15/16		247,014
	1,500	Lincoln Industrial Corp., Second Lien Loan, LIBOR + 5.75%, 1/12/15		1,477,500
		Mivisa Envases S.A.U. (EUR)
	826	Loan B1, LIBOR, 5/03/15		1,158,797
	174	Loan B2, LIBOR, 5/03/15		243,708
	2,469	Oshkosh Truck Corp., Loan B, LIBOR + 1.75%, 12/06/13		2,425,804

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	36

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)		Description	Value
Industrials—(cont’d)
		Standard Steel LLC,
$	411	Loan B, LIBOR + 2.50%, 6/30/12	$	403,229
	83	Delayed Draw Loan, Unfunded, 2.50%, 6/30/12		81,258
	1,210	Thermo Fluids, Inc., Loan B, LIBOR + 3.50%, 6/27/13		1,053,089
		Trimas Corp.,
	94	Letter of Credit, LIBOR + 2.25%, 8/02/13		91,875
	402	Loan B, LIBOR + 2.75%, 8/02/13		394,144
	468	United Rentals NA, Inc., LIBOR + 2.00%, 2/14/11		464,919
		Total Industrials		18,459,247
Media—11.1%
	500	Affinion Group, Inc., LIBOR + 6.25%, 3/01/12		485,834
	988	Atlantic Broadband Finance LLC, Loan B2, LIBOR + 2.25%, 8/10/12		971,697
	1,000	Audio Visual Services Corp., Second Lien Loan, LIBOR + 5.50%, 2/28/14		950,000
	3,940	Cablevision Systems Corp., LIBOR + 1.75%, 3/29/13		3,842,485
	6,468	Cequel Communications II LLC, First Lien Loan, LIBOR + 2.00%, 4/04/13		6,258,115
	6,000	Charter Communications Holdings LLC, LIBOR + 2.00%, 3/06/13		5,760,000
	714	CMP Susquehanna Corp., Loan B, LIBOR + 2.00%, 5/05/13		689,569
		Dex Media West LLC/Dex Media Finance Co.,
	625	Loan B1, LIBOR + 1.50%, 3/09/10		617,292
	2,486	Loan B2, LIBOR + 1.50%, 3/09/10		2,454,977
	1,311	DirecTV Holdings LLC, Loan B, LIBOR + 1.50%, 4/13/13		1,301,047
		Gatehouse Media Operating, Inc.,
	592	Delayed Draw Loan, LIBOR + 2.00%, 8/28/14		548,031
	1,000	Loan B, LIBOR + 2.00%, 8/28/14		926,250
	2,000	Gray Television, Inc., Delayed Draw Loan, LIBOR + 1.50%, 12/31/14		1,924,166
	2,978	Idearc, Inc., Loan B, LIBOR + 2.00%, 11/17/14		2,932,528
	499	Knology, First Lien Loan, LIBOR + 2.25%, 6/30/12		481,294
	1,985	Mediacom Broadband LLC, Loan D1, LIBOR + 1.75%, 1/31/15		1,919,070
	1,960	Mediacom Illinois LLC, Loan C, LIBOR + 1.75%, 1/31/15		1,896,481
	1,907	Mission Broadcasting, Inc., Loan B, LIBOR + 1.75%, 10/01/12		1,835,485
	357	Multicultural Radio Broadcasting, Inc., LIBOR + 2.75%, 12/18/12		349,860
	1,000	National CineMedia, Inc., Loan B, LIBOR + 1.75%, 2/13/15		964,219
		New Wave Communications,
	2	LIBOR + 2.75%, 6/20/13		68,950
	938	Loan A, LIBOR + 3.50%, 6/30/13		924,053
	235	Loan Z, LIBOR + 3.50%, 6/20/13		164,495
	63	TBD, 6/20/13		62,055
	1,806	Nexstar Finance, Inc., Loan B, LIBOR + 1.75%, 10/01/12		1,738,291
	3,465	Nielsen Finance LLC/Nielsen Finance Co., Loan B, LIBOR + 2.00%, 8/09/13		3,368,754
		NTL Investment Holding Ltd.,
	446	Loan B1, LIBOR + 2.13%, 9/03/12 (GBP)		897,657
	522	Loan B2, TBD, 9/03/12 (GBP)		1,049,219
	484	Loan B4, LIBOR + 2.00%, 9/03/12		468,552
	2,000	Loan C, TBD, 3/03/13 (GBP)		4,038,001
		Penton Media, Inc.,
	1,119	First Lien Loan, LIBOR + 2.25%, 2/01/13		1,059,209
	1,000	Second Lien Loan, LIBOR + 5.00%, 2/01/14		932,500
		ProSieben (EUR)
	500	Loan B1, LIBOR + 2.375%, 3/04/16		676,291
	500	Loan C1, LIBOR + 2.625%, 6/30/15		679,913
	1,000	Loan D1, LIBOR + 3.75%, 9/02/16		1,329,044
	750	Puerto Rico Cable Acquisition Co., Second Lien Loan, LIBOR + 6.25%, 1/26/12		708,750
	998	RCN Corp., Loan B, LIBOR + 2.25%, 5/25/14		965,705
	2,838	RH Donnelley, Inc., Loan D2, LIBOR + 1.50%, 6/30/11		2,792,642

Principal Amount (000)		Description	Value
Media—(cont’d)
		Univision Communications, Inc.,
$	201	Delayed Draw Loan, Unfunded, 1.00%, 9/29/14	$	190,541
	5,799	Loan B, LIBOR + 2.25%, 9/29/14		5,487,583
	1,000	Second Lien Loan, LIBOR, 3/29/09		989,375
		UPC Broadband Holding BV,
	1,413	Loan M1, LIBOR, 12/31/14 (EUR)		1,977,718
	3,500	Loan N1, LIBOR + 1.75%, 12/31/14		3,380,783
	1,922	WMG Acquisition Corp., LIBOR + 2.00%, 2/28/11		1,872,243
		Yell Group Plc,
	1,000	Loan B, LIBOR + 2.00%, 2/10/13		984,063
	1,500	Loan B, LIBOR + 2.00%, 2/27/13 (EUR)		2,137,176
		Total Media		76,051,963
Real Estate—0.7%
	3,000	Georgian Towers, Loan B5, LIBOR, 3/01/12		2,853,269
	488	Masonite Intl. Corp., LIBOR + 2.00% , 4/06/13		456,891
	1,496	Realogy Corp., LIBOR + 3.00%, 10/10/13		1,388,333
		Total Real Estate		4,698,493
Technology—2.9%
	737	Affiliated Computer Services, Inc., Loan B, LIBOR + 2.00%, 3/20/13		726,397
	973	ClientLogic Corp., LIBOR + 2.50%, 1/30/14		919,920
	995	CoCreate Software, Inc., LIBOR + 3.00%, 5/17/13		965,150
	371	Coinstar, Inc., LIBOR + 2.25%, 7/07/11		369,173
	500	Electrical Components Intl. Holdings Co., Second Lien Loan, LIBOR + 6.50%, 5/01/14		440,000
	1,750	First Data Corp., Loan B1, LIBOR + 2.75% 9/24/14		1,683,579
	4,000	Flextronics Intl. Ltd., Loan A, LIBOR, 10/12/14		3,970,000
		Intergraph Corp.,
	419	First Lien Loan, LIBOR + 2.00%, 5/29/14		408,747
	750	Second Lien Loan, LIBOR + 6.00%, 11/15/14		744,375
	989	Marvell Technology Group Ltd., Loan B, LIBOR + 2.50%, 11/09/09		967,114
	694	RedPrairie Corp., Loan B, PRIME + 2.00%, 7/20/12		676,628
	1,500	San Juan Cable, LIBOR + 6.50%, 10/31/13		1,434,845
	1,945	Sensata Technologies BV, Loan B, LIBOR + 1.75%, 4/27/13		1,889,922
	2,444	SunGard Data Systems, Inc., Loan B, LIBOR + 2.00%, 2/28/14		2,408,204
	945	Verifone, Inc., LIBOR + 1.75%, 10/31/13		937,913
	996	Wire Rope Corp., LIBOR + 2.25%, 2/08/14		970,961
		Total Technology		19,512,928
Telecommunications—3.7%
	1,990	American Cellular Corp., Loan B, LIBOR + 2.00%, 3/15/14		1,981,294
	1,250	American Cellular Wireless LLC, Delayed Draw Loan, Unfunded, 0.75%, 3/15/14		1,242,187
		Cellular South, Inc.,
	500	Delayed Draw Loan, Unfunded, 1.00%, 5/29/14		490,000
	1,496	Loan B, PRIME + 0.75%, 5/29/14		1,466,325
	1,481	Consolidated Communications, Inc., Loan D, LIBOR + 1.75%, 10/14/11		1,471,066
	500	Country Road Communications LLC, Second Lien Loan, LIBOR + 7.75%, 7/15/13		492,500
		Eircom Group Plc (EUR)
	2,000	Loan B, LIBOR + 1.88%, 9/30/14		2,835,813
	2,000	Loan C, LIBOR + 2.13%, 9/30/15		2,851,831
	4,000	Insight Midwest Holdings LLC, Loan B, Unfunded, 1.75%, 4/06/14		3,912,224
	2,000	Iowa Telecommunications Services, Inc., Loan B, LIBOR + 1.75%, 11/23/11		1,970,000
		NG Wireless,
	140	Delayed Draw Loan, Unfunded, 0.50%, 7/31/14		138,269
	610	First Lien Loan, PRIME + 2.75%, 7/31/14		600,481
	1,700	NTELOS, Inc., First Lien Loan, LIBOR + 2.25%, 8/24/11		1,679,861
	2,970	West Corp., Loan B2, LIBOR + 2.38%, 10/24/13		2,909,004

See Notes to Financial Statements.
37	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Limited Duration Income Trust (BLW) (concluded)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Telecommunications—(cont’d)
			Wind Acquisition Finance S.A. (EUR)
$	693		Loan A1, LIBOR + 2.00%, 5/25/12	$	990,929
	139		Loan A2, LIBOR + 2.00%, 12/31/10		199,284
			Total Telecommunications		25,231,068
Transportation—2.2%
			Dockwise Transport N.V.,
	1,489		Loan B1, LIBOR + 2.38%, 11/01/15		1,447,470
	489		Loan C, LIBOR + 2.88%, 11/01/16		474,401
	1,000		Loan C2, LIBOR + 2.88%, 11/01/16		975,625
			Hawker Beechcraft Acquisition Co.,
	78		Letter of Credit, Unfunded, 0.50%, 3/26/14		76,076
	917		LIBOR + 2.00%, 3/26/14		894,585
	1,750		RailAmerica, Inc., Loan B, LIBOR + 2.25%, 8/14/08		1,719,375
	644		Sirva Worldwide, Inc., LIBOR + 7.25%, 12/01/10		450,378
	3,977		Swift Transportation Co., Inc., LIBOR + 3.00%, 5/10/14		3,488,881
	3,000		U.S. Airways, Loan B, LIBOR + 2.50%, 3/24/14		2,863,392
	2,239		United Air Lines, Inc., Loan B, LIBOR + 2.00%, 2/01/14		2,142,358
			Total Transportation		14,532,541
			Total Bank Loans		386,247,615
Mortgage Pass-Through Securities—21.3%
			Federal National Mortgage Assoc.,
	22	8	5.50%, 12/01/28		21,448
	8,564		5.50%, 4/01/29-11/01/33		8,467,048
	17,000		7.25%, 1/15/10		18,027,939
	121,000		TBA, 5.00%, 11/19/22		119,109,375
			Total Mortgage Pass-Through Securities		145,625,810
Interest Only Asset-Backed Securities—0.2%
			Sterling Coofs Trust,
	21,937		Ser. 1, 2.365%, 4/15/29		973,475
	18,114	2	Ser. 2, 2.081%, 3/30/30		486,826
			Total Interest Only Asset-Backed Securities		1,460,301
U.S. Government and Agency Securities—4.1%
			U.S. Treasury Notes,
	20,425	4	3.375%, 12/15/08-9/15/09		20,273,083
	6,000	4,8	3.875%, 5/15/09		5,992,032
	1,815	4	4.25%, 8/15/15		1,801,388
			Total U.S. Government and Agency Securities		28,066,503
Foreign Government Bonds—2.5%
	238		Bolivarian Republic of Venezuela, %, 12/18/07		238,029
	4,871		Peru Government International Bond, 8.375%, 5/03/16		5,735,602
	5,000	4	Republic of Colombia, 9.75%, 4/23/09		5,325,000
	5,093	4	Turkey, 7.00%, 9/26/16		5,328,806
			Total Foreign Government Bonds		16,627,437

Units (000)			Description	Value
Warrants—0.0%
	2	9	Reliant Resources, Inc., expires 8/25/08, strike price $0.001, 1 share for 1 warrant’	$	41,249

Shares
Common Stocks—0.0%
	7,579	1,9	Critical Care Systems Intl., Inc.	47,371
Preferred Stock—0.0%
	125,000	1	Superior Essex Holding Corp., Ser. A, 9.50%,	77,500
			Total Long-Term Investments (cost $930,394,349)	913,265,094

Principal Amount (000)
SHORT-TERM INVESTMENT—0.5%
U.S. Government and Agency Discount Notes—0.5%
$	3,200	10	Federal Home Loan Bank Disc. Notes, 4.351%, 11/01/07 (cost $3,200,000)		3,200,000
Total investments—134.2% (cost $933,594,34911)				$	916,465,094
Liabilities in excess of other assets—(34.2)%					(233,355,673	)
Net Assets—100% $				$	683,109,421

1	Security is fair valued.
2	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 9.8% of its net assets, with a current market value of $66,717,528, in securities restricted as to resale.
3	Variable rate security. Rate shown is interest rate as of October 31, 2007.
4	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
5	Illiquid security. As of October 31, 2007, the Trust held 0.6% of its net assets, with a current market value of $4,365,591, in these securities.
6	Represents a step up bond; the interest rate shown reflects the effective yield at the time of purchase.
7	Issuer is in default and/or bankruptcy.
8	Security, or a portion thereof, pledged as collateral with a value of $77,630 on 81 long U.S. Treasury Note futures contracts expiring December 2007. The notional value of such contracts on October 31, 2007 was $8,694,844, with an unrealized gain of $45,523.
9	Non-income producing security.
10	Rate shown is the yield to maturity as of the date of purchase.
11	Cost for federal income tax purposes is $933,721,317. The net unrealized depreciation on a tax basis is $17,256,223, consisting of $9,391,420 gross unrealized appreciation and $26,647,643 gross unrealized depreciation.

For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	38

Portfolio of Investments as of October 31, 2007	BlackRock Preferred and Equity Advantage Trust (BTZ)
	(Percentages shown are based on Net Assets)

Shares			Description	Value
LONG-TERM INVESTMENTS—144.4%
Common Stocks—40.4%
Aerospace & Defense—0.6%
	1,900		L-3 Communications Holdings, Inc.	$	208,316
	28,300		Lockheed Martin Corp.		3,114,132
	40,300		Northrop Grumman Corp.		3,369,886
			Total Aerospace & Defense		6,692,334
Automotive—0.3%
	264,500	1	Ford Motor Co.		2,346,115
	1,900		General Motors Corp.		74,461
	11,200		Genuine Parts Co.		549,584
	3,800		PACCAR, Inc.		211,128
			Total Automotive		3,181,288
Basic Materials—1.7%
	23,300		Allegheny Technologies, Inc.		2,380,561
	2,400		BASF AG (ADR)		333,408
	72,200		Dow Chemical Co. (The)		3,251,888
	71,500		E.I. du Pont de Nemours & Co.		3,539,965
	74,200		Intl. Paper Co.		2,742,432
	33,900		MeadWestvaco Corp.		1,140,396
	21,000		Monsanto Co.		2,050,230
	30,000		Nucor Corp.		1,860,600
	13,700		PPG Industries, Inc.		1,023,938
	14,100		Weyerhauser Co.		1,070,331
			Total Basic Materials		19,393,749
Building & Development—0.1%
	9,300		D.R. Horton, Inc.		118,017
	2,600		KB Home		71,864
	16,000		Masco Corp.		385,280
			Total Building & Development		575,161
Consumer Products—5.7%
	93,100		Altria Group, Inc.		6,789,783
	4,800	1	Amazon.com, Inc.		427,920
	76,200	1	Amgen, Inc.		4,427,982
	45,000		Anheuser-Busch Cos., Inc.		2,307,600
	10,300		Black & Decker Corp.		926,073
	8,300		Clorox Co.		519,331
	14,300	1	Coach, Inc.		522,808
	68,100		Coca-Cola Co. (The)		4,205,856
	49,506		CVS Caremark Corp.		2,067,866
	26,400		Eastman Kodak Co.		756,624
	21,800		Fortune Brands, Inc.		1,826,186
	6,700		Gap, Inc.		126,630
	112,500		Home Depot, Inc.		3,544,875
	6,900		JCPenney Co., Inc.		388,056
	10,600	1	Kohl’s Corp.		582,682
	54,446		Kraft Foods, Inc.		1,819,041
	17,200		Loews Corp.		844,348
	12,600		Ltd. Brands, Inc., Class A		277,326
	1,600		Macy’s, Inc.		51,248
	17,400		Newell Rubbermaid, Inc.		507,384
	1,400		Nordstrom, Inc.		55,216
	1,500		OfficeMax, Inc.		47,475
	60,300		PepsiCo, Inc.		4,445,316
	128,000		Procter & Gamble Co.		8,898,560
	19,700		Reynolds American, Inc.		1,269,271
	140,100		Sara Lee Corp.		2,317,254
	10,100	1	Sears Holdings Corp.		1,361,379
	75,900	1	Starbucks Corp.		2,025,012
	1,000		Universal Corp.		48,740
	53,100		UST, Inc.		2,831,292
	4,700		VF Corp.		409,511
	115,100		Wal-Mart Stores, Inc.		5,203,671
	37,900		Walgreen Co.		1,502,735
			Total Consumer Products		63,335,051

Shares			Description	Value
Energy—5.3%
	13,500		American Electric Power, Inc.	$	650,835
	15,500		Anadarko Petroleum Corp.		914,810
	11,100		Apache Corp.		1,152,291
	2,900		BP Plc (ADR)		226,171
	10,700		Baker Hughes, Inc.		927,904
	15,800		Chesapeake Energy Corp.		623,784
	100,400		Chevron Corp.		9,187,604
	55,900		ConocoPhillips		4,749,264
	35,700		Consolidated Edison, Inc.		1,681,113
	27,600		DTE Energy Co.		1,368,960
	14,900		Devon Energy Corp.		1,391,660
	78,400		Duke Energy Corp.		1,502,928
	22,800		Exelon Corp.		1,887,384
	155,900		Exxon Mobil Corp.		14,341,241
	24,500		Great Plains Energy, Inc.		731,080
	14,000		Hess Corp.		1,002,540
	13,800	1	National Oilwell Varco, Inc.		1,010,712
	1,500		Nicor, Inc.		64,905
	24,000		NiSource, Inc.		490,800
	21,000		Sasol Ltd. (ADR)		1,068,060
	25,400		Schlumberger Ltd.		2,452,878
	49,918		Smith Intl., Inc.		3,297,084
	44,700		Southern Co.		1,638,702
	24,400		Spectra Energy Corp.		633,912
	15,100	1	Transocean, Inc.		1,802,487
	21,200		Valero Energy Corp.		1,493,116
	13,000	1	Weatherford Intl. Ltd.		843,830
	2,300		Williams Cos., Inc.		83,927
	14,800		XTO Energy, Inc.		982,424
			Total Energy		58,202,406
Entertainment & Leisure—0.3%
	12,500		Brunswick Corp.		278,875
	31,900		Carnival Corp.		1,530,562
	50,000		Regal Entertainment Group		1,128,500
			Total Entertainment & Leisure		2,937,937
Financial Institutions—7.5%
	11,700		American Capital Strategies Ltd.		507,897
	47,700	2	American Intl. Group, Inc.		3,010,824
	18,300		Arthur J. Gallagher & Co.		486,963
	71,400		BB&T Corp.		2,639,658
	205,400		Bank of America Corp.		9,916,712
	37,452		Bank of New York Mellon Corp.		1,829,530
	1,800		CME Group, Inc.		1,199,250
	31,600		Charles Schwab Corp. (The)		734,384
	16,800		Cigna Corp.		881,832
	246,300		Citigroup, Inc.		10,319,970
	33,800		Comerica, Inc.		1,577,784
	37,750		Discover Financial Services		728,575
	84,900	1	E*Trade Financial Corp.		945,786
	37,400		Fannie Mae		2,133,296
	5,400		Franklin Resources, Inc.		700,272
	22,900		Freddie Mac		1,196,067
	23,800		Goldman Sachs Group, Inc. (The)		5,900,496
	20,700		HSBC Holdings Plc (ADR)		2,060,064
	21,400		Hartford Financial Services Group, Inc.		2,076,442
	85,300		JPMorgan Chase & Co.		4,009,100
	13,300		KeyCorp		378,385
	24,200		Legg Mason, Inc.		2,007,148
	26,600		Lehman Brothers Holdings, Inc.		1,684,844
	40,800		Lincoln National Corp.		2,544,696
	259,600		MCG Capital Corp.		3,636,996
	54,900		Marsh & McLennan Cos., Inc.		1,421,361
	28,600		MetLife, Inc.		1,969,110
	19,500		National City Corp.		472,875
	54,700		Progressive Corp.		1,011,950
	15,300		Prudential Financial, Inc.		1,479,816

See Notes to Financial Statements.
39	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007 BlackRock Preferred and Equity Advantage Trust (BTZ)
(continued) (Percentages shown are based on Net Assets)

Shares		Description		Value
Financial Institutions—(cont’d)
23,900		Regions Financial Corp.	$	648,168
19,100		Safeco Corp.		1,105,890
25,900		Travelers Cos., Inc.		1,352,239
75,100		U.S. Bancorp		2,490,316
64,900		Wachovia Corp.		2,967,877
48,600		Washington Mutual, Inc.		1,354,968
81,300		Wells Fargo & Co.		2,765,013
25,700		Western Union Co. (The)		566,428
8,900		XL Capital Ltd., Class A Bermuda		640,355
		Total Financial Institutions		83,353,337
Health Care—4.7%
52,200		Abbott Laboratories		2,851,164
11,900		Allergan, Inc.		804,202
9,600	1	Biogen Idec, Inc.		714,624
32,600	1	Boston Scientific Corp.		452,162
153,200		Bristol-Myers Squibb Co.		4,594,468
13,200	1	Celgene Corp.		871,200
50,100	1	Charles River Laboratories Intl., Inc.		2,905,800
32,500		Covidien Ltd. Bermuda		1,352,000
64,900		Eli Lilly & Co.		3,514,335
10,100	1	Genzyme Corp.		767,297
31,200	1	Gilead Sciences, Inc.		1,441,128
106,600		Johnson & Johnson		6,947,122
11,400		McKesson Corp.		753,540
10,800	1	Medco Health Solutions, Inc.		1,019,304
107,500		Merck & Co., Inc.		6,262,950
367,900	2	Pfizer, Inc.		9,054,019
11,100		Quest Diagnostics, Inc.		590,298
11,500		Stryker Corp.		816,500
16,300	1	Thermo Fisher Scientific, Inc.		958,603
47,400		UnitedHealth Group, Inc.		2,329,710
23,700	1	WellPoint, Inc.		1,877,751
19,500	1	Zimmer Holdings, Inc.		1,355,055
		Total Health Care		52,233,232
Industrials—3.1%
43,500		3M Co.		3,756,660
44,800		Caterpillar, Inc.		3,342,528
3,500		Cummins, Inc.		419,860
9,200		Danaher Corp.		788,164
45,400		Emerson Electric Co.		2,373,058
14,500		Fluor Corp.		2,291,000
383,400		General Electric Co.		15,780,744
38,000		Illinois Tool Works, Inc.		2,175,880
22,800		Johnson Controls, Inc.		996,816
20,300		Leggett & Platt, Inc.		394,429
5,300		Precision Castparts Corp.		793,993
15,900		Rockwell Automation, Inc.		1,095,192
3,300		Tyco Intl. Ltd.		135,861
		Total Industrials		34,344,185
Media—1.1%
75,100		CBS Corp., Class B		2,155,370
2,987		Citadel Broadcasting Corp.		13,144
129,450	1	Comcast Corp., Class A		2,724,923
55,700	1	DIRECTV Group, Inc.		1,474,936
34,300		New York Times Co. (The)		670,908
77,300		News Corp., Class A		1,675,091
28,200	1	Viacom, Inc.		1,164,378
64,900		Walt Disney Co. (The)		2,247,487
		Total Media		12,126,237
Real Estate—0.5%
4,000		Boston Properties, Inc. (REIT)		433,360
9,900		Equity Residential (REIT)		413,622
15,600		First Industrial Realty Trust, Inc. (REIT)		635,700
51,500		Hospitality Properties Trust (REIT)		2,039,400

Shares		Description		Value
Real Estate—(cont’d)
6,000		Plum Creek Timber Co., Inc. (REIT)	$	268,020
39,600		Starwood Hotels & Resorts Worldwide, Inc.		2,251,656
		Total Real Estate		6,041,758
Technology—6.2%
19,700	1	Adobe Systems, Inc.		943,630
12,900	1	Agilent Technologies, Inc.		475,365
59,500		Analog Devices, Inc.		1,990,870
31,300	1	Apple, Inc.		5,945,435
52,300	1	AutoDesk, Inc.		2,557,470
18,000	1	Broadcom Corp.		585,900
27,200	1	Cognizant Technology Solutions Corp.		1,127,712
82,700	1	Dell, Inc.		2,530,620
70,000	1	EMC Corp.		1,777,300
92,800	1	eBay, Inc.		3,350,080
16,500	1	Electronic Arts, Inc.		1,008,480
7,300	1	Google, Inc.		5,161,100
37,800		Hewlett-Packard Co.		1,953,504
182,900		Intel Corp.		4,920,010
22,000		Intl. Business Machines Corp.		2,554,640
39,100	1	Lam Research Corp.		1,962,820
69,800		Linear Technology Corp.		2,304,796
7,500	1	MEMC Electronic Materials, Inc.		549,150
287,000		Microsoft Corp.		10,564,470
94,050	1	Nvidia Corp.		3,327,489
131,500	1	Oracle Corp.		2,915,355
51,900		Paychex, Inc.		2,168,382
17,200		Pitney Bowes, Inc.		688,688
44,900	1	SanDisk Corp.		1,993,560
115,800	1	Sanmina-SCI Corp.		255,918
252,400	1	Sun Microsystems, Inc.		1,441,204
34,900	1	Symantec Corp.		655,422
32,500		Tyco Electronics Ltd.		1,159,275
36,300	1	Xerox Corp.		633,072
4,300		Xilinx, Inc.		104,920
42,000	1	Yahoo!, Inc.		1,306,200
		Total Technology		68,912,837
Telecommunications—2.6%
175,987		AT&T, Inc.		7,354,497
40,610		Chunghwa Telecom Co. Ltd. (ADR)		779,712
209,600	1	Cisco Systems, Inc.		6,929,376
64,000		Citizens Communications Co.		842,240
52,500		Corning, Inc.		1,274,175
17,200	1	Juniper Networks, Inc.		619,200
123,900		Qualcomm, Inc.		5,294,247
98,400		Verizon Communications, Inc.		4,533,288
93,412		Windstream Corp.		1,256,391
		Total Telecommunications		28,883,126
Transportation—0.7%
16,000		General Maritime Corp.		450,880
51,645		Nordic American Tanker Shipping		1,998,145
87,700		Ship Finance Intl. Ltd.		2,401,226
37,900		United Parcel Service, Inc., Class B		2,846,290
		Total Transportation		7,696,541
		Total Common Stocks		447,909,179
Preferred Stocks—18.9%
Energy—2.7%
100,000		Alabama Power Co., 6.50%		2,525,000
40,000		Entergy Louisiana LLC, 6.95%		4,156,478
785,000		Interstate Power & Light Co., Ser. B, 8.375%		23,672,695
		Total Energy		30,354,173

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	40

Portfolio of Investments as of October 31, 2007 BlackRock Preferred and Equity Advantage Trust (BTZ)
(continued) (Percentages shown are based on Net Assets)

	Shares		Description		Value
Financial Institutions—14.7%
	400,000		ACE Ltd., Ser. C, 7.80%	$	10,237,520
	400,000		Aegon N.V., 6.50%		9,137,520
			Arch Capital Group Ltd.,
	100,000		8.00%		2,500,000
	160,000		Ser. B, 7.875%		3,947,200
	655,000	3	Aspen Insurance Holdings Ltd., 7.401%		15,621,750
	180,000	3	Axis Capital Holdings Ltd., Ser. B, 7.50%		18,331,884
	320,000		Bank of America Corp., 6.625%		8,210,016
	10,000	4	Centaur Funding Corp., Ser. B, 9.08%		11,312,500
	150,000	4	CoBank ACB, 7.00%		7,478,700
	389,000		Endurance Specialty Holdings Ltd., 7.75%		9,907,363
	316,000		Federal Home Loan Mortgage Corp., Ser. Y, 6.55%		8,137,000
	200,000		ING Groep N.V., 6.125%		4,387,500
	265,600		PartnerRE Ltd., Ser. C, 6.75%		6,241,600
	285,000		RenaissanceRe Holdings Ltd., Ser. D, 6.60%		6,093,300
	50	3	Roslyn Real Estate Asset Corp., Ser. D, 8.881%		5,026,562
	67,200		Royal Bank of Scotland Group Plc, Ser. L, 5.75%		1,414,560
			Santander Finance Preferred S.A. Unipersonal,
	522,000	4	6.50%		12,267,000
	670,000	4	7.05%		15,703,125
	277,900		XL Capital Ltd., Ser. B, 7.625%		6,964,869
			Total Financial Institutions		162,919,969
Real Estate—1.5%
	300,000		CBL & Associates Properties, Inc., Ser. C, 7.75% (REIT)		7,206,000
	55,000		iStar Financial, Inc., Ser. I, 7.50% (REIT)		1,182,500
	372,500		Public Storage, Inc., Ser. M, 6.625% (REIT)		8,229,941
			Total Real Estate		16,618,441
			Total Preferred Stocks		209,892,583

	Principal Amount (000)
Trust Preferred Stocks—71.6%
Building & Development—0.3%
$	3,160	3,4,5	C8 Capital SPV Ltd., 6.64% (British Virgin Islands)	3,080,905
Energy—2.6%
	4,500	3	Enterprise Products Operating LP, 8.375%, 8/01/66	4,684,248
	120,000		Nexen, Inc., 7.35%, 11/01/43	2,970,000
	5,900	3	PPL Capital Funding, Inc., Ser. A, 6.70%, 3/30/67	5,693,022
	288,000		PPL Energy Supply LLC, 7.00%, 7/15/46	7,209,014
	1,575	3	Puget Sound Energy, Inc., Ser. A, 6.974%, 6/01/67	1,482,497
	7,325	3	Trans-Canada Pipelines Ltd., 6.35%, 5/15/67 (Canada)	7,086,945
			Total Energy	29,125,726
Financial Institutions—64.8%
	2,375	3,5	Abbey National Capital Trust I, 8.963%	2,897,982
	17,000		Ace Capital Trust II, 9.70%, 4/01/30	21,717,840
			Allstate Corp.,
	8,725	3	6.125%, 5/15/37	8,531,916
	10,675	3	6.50%, 5/15/57	10,350,918
	11,150		American Intl. Group, Inc., Ser. A1, 6.25%, 3/15/37	10,376,268
	18,273		AON Corp., 8.205%, 1/01/27	19,846,561
	5,000		Astoria Capital Trust I, Ser. B, 9.75%, 11/01/29	5,612,955
			AXA S.A. (France)
	17,000	3,4,5	6.463%	15,807,178
	3,225	3,4,5	6.379%	2,937,188
			Barclays Bank Plc (United Kingdom)
	15,000	3,4,5	6.86%	14,704,647
	4,275	3,4,5	7.434%	4,531,675
	15,300	3	BB&T Capital Trust IV, 6.82%, 6/12/57	14,904,311
	170,731		Berkley W.R. Capital Trust II, 6.75%, 7/26/45	3,996,181
	23,200,	2,3,4,5	BNP Paribas, 7.195% (France)	23,075,834
	6,685	3,4,5	BOI Capital Funding No. 2 LP, 5.571% (Ireland)	6,145,521

	Principal
	Amount
	(000)		Description		Value
Financial Institutions—(cont’d)
$	30,000	3,4,5,6	BOI Capital Funding No. 3, 6.107% (Ireland)	$	27,601,950
	7,700	5	BTA Finance Luxembourg SA, 8.25% (Kazakhstan)		5,736,500
	5,000	3,4,5	C10 Capital SPV Ltd., 6.722% (British Virgin Islands)		4,818,500
	5,000		Capital One Capital III, 7.686%, 8/15/36		4,846,285
	15,300	3	Chubb Corp., 6.375%, 3/29/37		15,061,029
	210,000		Citizens Funding Trust I, 7.50%, 9/15/66		4,882,500
	20,000	3,4,5	Commonwealth Bank of Australia, 6.024% (Australia)		19,269,300
	27,970	3,4,5	Credit Agricole S.A., 6.637% (France)		26,581,905
	7,000	3,5	Credit Suisse Ltd., 5.86% (Guernsey)		6,520,927
	7,200	4	Dresdner Funding Trust I, 8.151%, 6/30/31		7,877,347
	12,025	3	Everest Reinsurance Holdings, Inc., 6.60%, 5/15/37		11,244,133
	2,025	3,5	Goldman Sachs Capital II, 5.793%		1,888,537
	25,000	3,4,5	HBOS Plc, 6.657% (United Kingdom)		22,216,250
	7,000	3,4,5	HSBC Capital Funding LP, Ser. 2, 10.176% (Jersey Channel Islands)		9,205,357
	3,250	3	Huntington Capital III, 6.65%, 5/15/37		3,049,846
	3,867	4	HVB Funding Trust I, 8.741%, 6/30/31		4,485,782
	25,100	3,4,5,6	ICICI Bank Ltd., 7.25% (India)		23,306,103
	10,000	3,5	ING Groep N.V., 5.775% (Netherlands)		9,658,830
	12,875	3	JPMorgan Chase Capital XXI, Ser. U, 5.844%, 2/02/37		11,422,430
	13,945	3	JPMorgan Chase Capital XXIII, 6.558%, 5/15/47		12,289,296
	5,000	5	Kazkommerts Finance 2 BV, 9.25% (Netherlands)		4,548,875
	785,000		KeyCorp Capital IX, 6.75%, 12/15/66		18,494,600
	5,000	3,5	Lehman Brothers Holdings Capital Trust V, Ser. MTN, 5.857%		4,666,875
	11,600	3,4	Liberty Mutual Group, Inc., Ser. B, 7.00%, 3/15/37		10,903,907
	4,225	3	Lincoln National Corp., 6.05%, 4/20/67		4,049,244
	13,000	3,4,5	Lloyds TSB Group Plc, 6.267% (United Kingdom)		12,026,547
	10,000	3,4	Mangrove Bay Pass-Through Trust, 6.102%, 7/15/33		9,334,000
	21,000	3,4,5	Mizuho Capital Investment 1 Ltd., 6.686% (Cayman Islands)		19,899,180
	298,100		National City Capital Trust II, 6.625%, 11/15/36		6,390,519
	8,025		Nationwide Financial Services, 6.75%, 5/15/37		7,719,721
	19,675	3	Progressive Corp., 6.70%, 6/15/37, 6/15/37		19,306,743
	7,105	3,4,5	QBE Capital Funding II LP, 6.797% (Jersey Channel Islands)		6,948,676
	7,780	5	RBS Capital Trust, Ser. B, 6.80% (United Kingdom)		7,604,950
	16,825	3,4,5	Resona Preferred Global Securities Ltd., 7.191% (Cayman Islands)		16,895,800
			Royal Bank of Scotland Group Plc, (United Kingdom)
	4,675	3,4,5	6.99%		4,756,813
	3,130	3,5	7.648%		3,341,369
	6,100	3,5	Ser. MTN, 7.64%		6,322,723
	7,000	3,4,5	Shinsei Finance II, 7.16% (Cayman Islands)		6,345,941
	10,000	3,4,5	SMFG Preferred Capital 1 Ltd., 6.078% (Cayman Islands)		9,354,100
	17,850	3,4,5	Societe Generale, 5.922% (France)		16,987,666
	85,000		Sovereign Capital Trust V, 7.75%, 5/22/36		2,127,661
	28,305	3,6	State Street Capital Trust IV, 6.694%, 6/15/37		25,559,273
	11,300	3,4,5	Standard Chartered Plc, 7.014% (United Kingdom)		11,307,119
	27,475	3,4,5,6	Swiss Re Capital I LP, 6.854%		27,711,477
	19,100	3	Travelers Cos., Inc., 6.25%, 3/15/37		18,547,380
	95,700		Wachovia Capital Trust IX, 6.375%, 6/01/67		2,177,175
	3,225	3	Webster Capital Trust IV, 7.65%, 6/15/37		3,198,942
	4,400	3,4,5	White Mountains RE Group Ltd., 7.506% (Bermuda)		4,151,206
	7,150	3,4	Woori Bank, 6.208%, 5/02/37 (South Korea)		6,665,087
	10,000	3,5	XL Capital Ltd., Ser. E, 6.50% (Cayman Islands)		9,287,300
	15,220	3,4	ZFS Finance Trust I, 6.50%, 5/09/37		14,647,774
			Total Financial Institutions		718,678,425
Media—1.6%
	780,000		Comcast Corp., 6.625%, 5/15/56		18,119,400
Real Estate—1.6%
	13,000	4,5	Sovereign Real Estate Investment Corp. (REIT), 12.00%		18,122,000
Telecommunications—0.6%
	270,000		AT&T, Inc., 6.375%, 2/15/56		6,504,300
			Total Trust Preferred Stocks		793,630,756

See Notes to Financial Statements.
41	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007
BlackRock Preferred and Equity Advantage Trust (BTZ)
(continued) (Percentages shown are based on Net Assets)

	Principal Amount (000)		Description		Value
Corporate Bonds—12.6%
Automotive—0.4%
$	5,000		Lear Corp., Ser. B, 8.75%, 12/01/16	$	4,800,000
Basic Materials—0.2%
	2,350	4	Ineos Group Holdings Plc, 8.50%, 2/15/16
			(United Kingdom)		2,232,500
Commercial Services—0.4%
	5,000	4	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		4,875,000
Consumer Products—0.4%
	5,000	6	Michaels Stores, Inc., 11.375%, 11/01/16		4,987,500
Ecological Services & Equipment—0.4%
	5,000		Aleris Intl., Inc., 10.00%, 12/15/16		4,400,000
Energy—1.0%
	6,250		CMS Energy Corp., 6.55%, 7/17/17		6,066,737
	5,000	3	Southern Union Co., 7.20%, 11/01/66		4,991,065
			Total Energy		11,057,802
Entertainment & Leisure—0.6%
	2,500		AMC Entertainment, Inc., 11.00%, 2/01/16		2,706,250
	1,760		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		1,298,000
	3,000		Station Casinos, Inc., 6.875%, 3/01/16		2,482,500
			Total Entertainment & Leisure		6,486,750
Financial Institutions—6.2%
			Bear Stearns Cos., Inc. (The),
	3,050		6.40%, 10/02/17		3,040,106
	3,000		Ser. MTN, 6.95%, 8/10/12		3,122,076
	3,095	3	CIT Group, Inc., 5.734%, 11/23/07		3,089,899
	6,500	3,4	ICICI Bank Ltd., 6.375%, 4/30/22 (India)		6,018,539
	18,400		JPMorgan Chase Capital XXV, Ser. Y, 6.80%, 10/01/37		18,379,705
			Lehman Brothers Holdings, Inc.,
	6,375		6.875%, 7/17/37		6,316,669
	1,075	3	Ser. MTN, 7.394%, 9/15/22		1,098,436
	3,750	3	Lincoln National Corp., 7.00%, 5/17/66		3,851,715
	4,550		MetLife, Inc., 6.40%, 12/15/36		4,310,242
	5,000	4	Momentive Performance Materials, Inc., 9.75%, 12/01/14		4,875,000
	15,000	3	Reinsurance Group of America, Inc., 6.75%, 12/15/65		14,263,755
			Total Financial Institutions		68,366,142
Health Care—0.4%
	4,500		Tenet Healthcare Corp., 9.875%, 7/01/14		4,095,000
Industrials—0.0%
	283		Stan IV Ltd., 7.137%, 7/17/11		274,510
Media—0.5%
	5,000		Cablevision Systems Corp., Ser. B, 8.00%, 4/15/12		4,887,500
	1,000		Nexstar Finance, Inc., 7.00%, 1/15/14		960,000
			Total Media		5,847,500
Technology—1.3%
	4,410		Freescale Semiconductor, Inc., 9.125%, 12/15/14		3,991,050
	5,000		NXP BV/NXP Funding LLC, 9.50%, 10/15/15 (Netherlands)		4,725,000
	5,000		SunGard Data Systems, Inc., 10.25%, 8/15/15		5,212,500
			Total Technology		13,928,550
Telecommunications—0.8%
			Intelsat Ltd. (Bermuda)
	3,325	3	8.886%, 1/15/15		3,374,875
	5,000		11.25%, 6/15/16		5,375,000
			Total Telecommunications		8,749,875
			Total Corporate Bonds		140,101,129
U.S. Government and Agency Securities—0.9%
	5,595		U.S. Treasury Bonds, 4.75%, 2/15/37		5,589,753
	4,340		U.S. Treasury Notes, 4.75%, 8/15/17		4,435,614
			Total U.S. Government and Agency Securities		10,025,367
			Total Long-Term Investments
			(cost $1,649,080,855)		1,601,559,014
	Shares		Description	Value
SHORT-TERM INVESTMENTS—2.8%
Money Market Fund—2.6%
	28,300	7	SSgA Tax Free Money Mkt. Fund - Class A, 4.757%	$	28,300,000

	Principal
	Amount
	(000)
U.S. Government and Agency Discount Notes—0.2%
$	2,100	8	Federal Home Loan Bank Disc. Notes,
			4.401%, 11/01/07	2,099,743
			Total Short-Term Investments
			(cost $30,399,743)	30,399,743
BORROWED BOND AGREEMENTS—1.2%
			Lehman Brothers, Inc.,
	3,947	10	4.53%, 11/08/07	3,946,555
	4,530	10	4.11%, 11/08/07	4,530,094
	5,356	10	4.25%, 11/02/07	5,355,637
			Total Borrowed Bond Agreements ($13,832,286)	13,832,286
			Total Investments before borrowed bonds,
			investments sold short and outstanding call
			options written (cost $1,693,312,8849)	1,645,791,043
BORROWED BONDS—(1.2)%
	(3,855	)	U.S. Treasury Bonds, 4.75%, 2/15/37	(3,851,383	)
	(9,695	)	U.S. Treasury Notes, 4.75, 8/15/17	(9,908,592	)
			Total Borrowed Bonds (proceeds $13,843,782)	(13,759,975	)
INVESTMENTS SOLD SHORT—(0.0)%
	(465	)3,4,5	Barclays Bank Plc, 5.926% (United Kingdom)
			(proceeds $441,536)	(440,135	)

	Contracts
	(000)
OUTSTANDING CALL OPTIONS WRITTEN—(0.4)%
	(48	)	S&P 500 Index, strike price $1,550, expires 11/17/07		(983,250	)
	(30	)	S&P 500 Index, strike price $1,550, expires 12/22/07		(1,200,650	)
	(108	)	S&P 500 Index, strike price $1,575, expires 11/17/07		(772,200	)
	(31	)	S&P 500 Index, strike price $1,575, expires 12/22/07		(706,000	)
	(30	)	S&P 500 Index, strike price $1,600, expires 12/22/07		(468,000	)
			Total Outstanding Options Written
			(premium received $5,426,127)		(4,130,100	)
Total Investments net of borrowed bonds, investments sold short
and outstanding call options written—146.8%				$	1,627,460,833
Liabilities in excess of other assets—(5.1)%					(56,649,879	)
Preferred shares at redemption value, including dividends
payable—(41.7)%					(462,276,473	)
Net Assets Applicable to Common Shareholders—100%				$	1,108,534,481

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	42

Portfolio of Investments as of October 31, 2007
BlackRock Preferred and Equity Advantage Trust (BTZ) (concluded)
(Percentages shown are based on Net Assets)

1	Non-income producing security.
2	Security, or a portion thereof, pledged as collateral with a value of $24,670,394 on 70 long S&P 500 Index futures contracts expiring December 2007 and 5,470 short U.S. Treasury Note futures contracts expiring December 2007. The notional value of such contracts on October 31, 2007 was $574,574,719, with an unrealized loss of $5,812,349.
3	Variable rate security. Rate shown is interest rate as of October 31, 2007.
4	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 43.0% of its net assets, with a current market value of $476,024,964, in securities restricted as to resale.
5	The security is a perpetual bond and has no stated maturity date.
6	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
7	Represents current yield as of October 31, 2007.
8	Rate shown is the yield to maturity as of the date of purchase.
9	Cost for federal income tax purposes is $1,671,302,709. The net unrealized depreciation on a tax basis is $47,639,949, consisting of $35,071,886 gross unrealized appreciation and $82,702,835 gross unrealized depreciation.
10	See Note 1 in the Notes to Financial Statements for details of borrowed bond agreements.
For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.
43	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Strategic Bond Trust (BHD)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
LONG-TERM INVESTMENTS—89.3%
Corporate Bonds—84.5%
Aerospace & Defense—6.8%
$	250	1	AAR Corp., Ser. A2, 8.39%, 5/15/11	$	252,500
	120	2	Bombardier, Inc., 8.00%, 11/15/14 (Canada)		124,800
	1,064		DI Finance/DynCorp Intl., Ser. B, 9.50%, 2/15/13		1,130,500
			DRS Technologies, Inc.,
	50		6.875%, 11/01/13		50,000
	80		7.625%, 2/01/18		81,800
	2,000		Lockheed Martin Corp., Ser. B, 6.15%, 9/01/36		2,057,416
	1,000		Northrop Grumman Corp., 7.125%, 2/15/11		1,061,478
	650		Raytheon Co., 4.85%, 1/15/11		643,928
	50		Sequa Corp., 9.00%, 8/01/09		53,625
	90		TransDigm, Inc., 7.75%, 7/15/14		91,575
	1,000		United Technologies Corp., 6.35%, 3/01/11		1,042,565
			Total Aerospace & Defense		6,590,187
Automotive—3.7%
	110		Accuride Corp., 8.50%, 2/01/15		103,400
	45	2	Ashtead Capital, Inc., 9.00%, 8/15/16		43,650
			AutoNation, Inc.,
	110		7.00%, 4/15/14		106,425
	110	3	7.243%, 4/15/13		107,525
	1,000		DaimlerChrysler NA Holding Corp., 7.30%, 1/15/12		1,074,229
	350		Ford Capital BV, 9.50%, 6/01/10 (Netherlands)		352,625
	275		Lear Corp., Ser. B, 8.75%, 12/01/16		264,000
	200		Metaldyne Corp., 10.00%, 11/01/13		186,000
	1,400		Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13		1,414,000
			Total Automotive		3,651,854
Basic Materials—5.1%
	320		AK Steel Corp., 7.75%, 6/15/12		326,400
	220		Abitibi-Consolidated, Inc., 6.00%, 6/20/13 (Canada)		161,700
	180		American Pacific Corp., 9.00%, 2/01/15		184,500
	60	3	Bowater, Inc., 8.694%, 3/15/10		54,900
	150		CPG Intl. I, Inc., 10.50%, 7/01/13		150,000
	20		Chemtura Corp., 6.875%, 6/01/16		19,100
	40		Domtar, Inc., 7.125%, 8/15/15 (Canada)		39,600
	130	2	FMG Finance Ltd., 10.625%, 9/01/16 (Australia)		154,050
			Freeport-McMoRan Copper & Gold, Inc.,
	690		8.375%, 4/01/17		755,550
	240	3	8.394%, 4/01/15		247,800
			Huntsman LLC,
	99		11.50%, 7/15/12		107,663
	50		11.625%, 10/15/10		53,000
	595	2	Ineos Group Holdings Plc, 8.50%, 2/15/16 (United Kingdom)		565,250
	980		Innophos, Inc., 8.875%, 8/15/14		987,350
	135	2	Key Plastics LLC/Key Plastics Finance Corp.,
			11.75%, 3/15/13		114,750
	130		Lyondell Chemical Co., 10.50%, 6/01/13		140,075
	530		NewPage Corp., 10.00%, 5/01/12		560,475
	155	3	NOVA Chemicals Corp., 8.484%, 11/15/13 (Canada)		152,287
	170		Terra Capital, Inc., Ser. B, 7.00%, 2/01/17		170,000
			Total Basic Materials		4,944,450
Building & Development—0.7%
	465		Goodman Global Holding Co., Inc., 7.875%, 12/15/12		485,925
	115		Nortek, Inc., 8.50%, 9/01/14		101,775
	125		North American Energy Partners, Inc.,
			8.75%, 12/01/11 (Canada)		126,250
			Total Building & Development		713,950
Commercial Services—0.1%
	120	2	Quebecor World, Inc., 9.75%, 1/15/15 (Canada)		117,000
Conglomerates—0.4%
	325		Honeywell Intl., Inc., 7.50%, 3/01/10		344,254

Principal Amount (000)			Description	Value
Consumer Products—3.8%
$	350	3	Ames True Temper, Inc., 9.243%, 1/15/12	$	336,000
	20	3	Avis Budget Car Rental LLC/Avis Budget Finance, Inc.,
			8.058%, 5/15/14		19,750
	60	2	Beverages & More, Inc., 9.25%, 3/01/12		61,800
			General Nutrition Centers, Inc.,
	360	3	10.194%, 3/15/14		346,500
	290		10.75%, 3/15/15		282,025
	362		Lazy Days RV Center, Inc., 11.75%, 5/15/12		325,800
			Michaels Stores, Inc.,
	340		10.00%, 11/01/14		342,550
	430	4	11.375%, 11/01/16		428,925
	500		Pantry, Inc. (The), 7.75%, 2/15/14		487,500
	100		Quiksilver, Inc., 6.875%, 4/15/15		93,250
	200		Reynolds American, Inc., 7.625%, 6/01/16		216,383
	525		Rite Aid Corp., 7.50%, 3/01/17		488,250
	270		Sally Holdings LLC, 10.50%, 11/15/16		268,650
			Total Consumer Products		3,697,383
Containers & Packaging—1.6%
			Berry Plastics Holding Corp.,
	190		8.875%, 9/15/14		194,750
	130	3	9.569%, 9/15/14		130,325
	250		Crown Americas LLC/Crown Americas Capital Corp.,
			7.75%, 11/15/15		257,500
	55		Graham Packaging Co., Inc., 8.50%, 10/15/12		54,588
	260	2,3	Impress Holdings BV, 8.368%, 9/15/13 (Netherlands)		258,636
	565		Pregis Corp., 12.375%, 10/15/13		615,850
			Total Containers & Packaging		1,511,649
Ecological Services & Equipment—2.1%
	1,500		Casella Waste Systems, Inc., 9.75%, 2/01/13		1,530,000
	550		Waste Services, Inc., 9.50%, 4/15/14		550,000
			Total Ecological Services & Equipment		2,080,000
Energy—11.0%
	100		Berry Petroleum Co., 8.25%, 11/01/16		102,000
	250		Chaparral Energy, Inc., 8.50%, 12/01/15		233,125
			Chesapeake Energy Corp.,
	130		6.375%, 6/15/15		126,100
	20		6.875%, 11/15/20		19,550
			Compagnie Generale de Geophysique-Veritas (France)
	65		7.50%, 5/15/15		66,300
	70		7.75%, 5/15/17		72,100
	255		Compton Petroleum Finance Corp.,
			7.625%, 12/01/13 (Canada)		244,163
	1,000		ConocoPhillips Holding Co., 6.95%, 4/15/29		1,138,708
	738	2,3	Corral Finans AB, 6.855%, 4/15/10 (Sweden)		697,569
	250		DTE Energy Co., 7.05%, 6/01/11		263,126
	1,000		Dominion Resources, Inc., 5.70%, 9/17/12		1,012,104
	125		Edison Mission Energy, 7.50%, 6/15/13		126,719
	175		El Paso Natural Gas Co., 8.375%, 6/15/32		203,997
	31		Elwood Energy LLC, 8.159%, 7/05/26		31,764
			Encore Acquisition Co.,
	30		6.00%, 7/15/15		27,150
	40		7.25%, 12/01/17		38,300
	275		Exco Resources, Inc., 7.25%, 1/15/11		271,562
	1,075		FirstEnergy Corp., Ser. C, 7.375%, 11/15/31		1,173,577
	360	2	Forest Oil Corp., 7.25%, 6/15/19		360,000
	60		Grant Prideco, Inc., Ser. B, 6.125%, 8/15/15		60,300
	225		KCS Energy, Inc., 7.125%, 4/01/12		221,625
	426		Midwest Generation LLC, Ser. B, 8.56%, 1/02/16		457,680
	185		Mirant Americas Generation LLC, 8.30%, 5/01/11		187,081
			NRG Energy, Inc.,
	50		7.25%, 2/01/14		50,000
	285		7.375%, 2/01/16		284,287
	250		Occidental Petroleum Corp., 6.75%, 1/15/12		264,973
	320	2	OPTI, Inc., 8.25%, 12/15/14 (Canada)		320,800
	140		Orion Power Holdings, Inc., 12.00%, 5/01/10		154,700

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	44

Portfolio of Investments as of October 31, 2007	BlackRock Strategic Bond Trust (BHD) (continued)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Energy—(cont’d)
$	1,000		Progress Energy, Inc., 7.75%, 3/01/31	$	1,174,755
	305		Sabine Pass LNG LP, 7.50%, 11/30/16		298,900
	275	2	SemGroup LP, 8.75%, 11/15/15		264,000
	400	2	Targa Resources, Inc., 8.50%, 11/01/13		404,000
	330		Whiting Petroleum Corp., 7.25%, 5/01/12-5/01/13		324,375
	25		Williams Cos., Inc., 7.125%, 9/01/11		25,938
			Total Energy		10,701,328
Entertainment & Leisure—0.8%
	200		AMC Entertainment, Inc., 11.00%, 2/01/16		216,500
	225	2	Greektown Holdings LLC, 10.75%, 12/01/13		223,875
	85		Harrah’s Operating Co., Inc., 5.75%, 10/01/17		62,688
	190		Seneca Gaming Corp., Ser. B, 7.25%, 5/01/12		191,425
	115		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp.,
			6.625%, 12/01/14		112,987
			Total Entertainment & Leisure		807,475
Financial Institutions—10.2%
	102		AES Ironwood LLC, 8.857%, 11/30/25		110,975
			American Real Estate Partners LP/American Real Estate Finance Corp.,
	230		7.125%, 2/15/13		224,250
	860		8.125%, 6/01/12		866,450
	106	2,3	BMS Holdings, Inc., 12.40%, 2/15/12		101,985
			Ford Motor Credit Co. LLC,
	1,600	3	6.813%, 1/15/10		1,524,146
	150	3	7.993%, 1/13/12		138,866
	250		7.80%, 6/01/12		234,894
	1,500		HSBC Bank, Inc., 3.875%, 9/15/09		1,469,899
	572	2	iPayment Investors LP, 11.625%, 7/15/14		589,367
	175		iPayment, Inc., 9.75%, 5/15/14		168,000
	325		MetLife, Inc., 6.125%, 12/01/11		336,267
			Momentive Performance Materials, Inc.,
	30	2	9.75%, 12/01/14		29,250
	445	2	11.50%, 12/01/16		429,425
			Rainbow National Services LLC,
	210	2	8.75%, 9/01/12		218,400
	1,455	2	10.375%, 9/01/14		1,600,500
	570	5	Structured Asset Receivable Trust, 1.649%, 1/21/10		564,635
	1,000	2	TIAA Global Markets, Inc., 3.875%, 1/22/08		997,133
	50	3	Universal City Florida Holding Co. I/II, 9.661%, 5/01/10		51,125
	425	2	Wimar Opco LLC/Wimar Opco Finance Corp.,
			9.625%, 12/15/14		318,750
			Total Financial Institutions		9,974,317
Health Care—3.4%
	1,000		Merck & Co., Inc., 4.375%, 2/15/13		969,871
	320		Tenet Healthcare Corp., 6.50%, 6/01/12		271,200
	1,000		WellPoint, Inc., 5.95%, 12/15/34		966,030
	1,000		Wyeth, 6.50%, 2/01/34		1,055,966
			Total Health Care		3,263,067
Industrials—1.7%
	260	2	AGY Holding Corp., 11.00%, 11/15/14		256,100
	100		Hexcel Corp., 6.75%, 2/01/15		98,250
	300		Park-Ohio Industries, Inc., 8.375%, 11/15/14		279,750
			RBS Global, Inc./Rexnord Corp.,
	350		9.50%, 8/01/14		361,375
	225		11.75%, 8/01/16		238,500
	470	1	Sunstate Equipment Co. LLC, 10.50%, 4/01/13		451,200
			Total Industrials		1,685,175
Media—14.4%
	400		Adelphia Communications Corp., 10.50%, 12/31/49		66,000
			Affinion Group, Inc.,
	435		10.125%, 10/15/13		453,487
	220		11.50%, 10/15/15		229,350
	125		American Media Operations, Inc., Ser. B, 10.25%, 5/01/09		119,688

Principal Amount (000)			Description	Value
Media—(cont’d)
$	1,000		AOL Time Warner, Inc., 7.70%, 5/01/32	$	1,123,704
	120	3	Cablevision Systems Corp., Ser. B, 9.644%, 4/01/09		123,300
	80		CanWest MediaWorks, Inc., 8.00%, 9/15/12 (Canada)		78,000
	215		Charter Communications Holdings I LLC/Charter Communications Holdings I Capital Corp.,
			11.00%, 10/01/15		208,550
			Charter Communications Holdings II LLC/Charter Communications Holdings II Capital Corp.,
	605		10.25%, 9/15/10		617,100
	105		Ser. B, 10.25%, 9/15/10		106,838
	500		CMP Susquehanna Corp., 9.875%, 5/15/14		459,375
	1,000		Comcast Cable Communications, Inc., 6.875%, 6/15/09		1,025,415
	50		Dex Media West LLC/Dex Media Finance Co., Ser. B,
			9.875%, 8/15/13		53,313
	100		DirecTV Holdings LLC/DirecTV Financing Co.,
			8.375%, 3/15/13		104,500
			EchoStar DBS Corp.,
	550		5.75%, 10/01/08		548,625
	210		7.00%, 10/01/13		218,662
	45		7.125%, 2/01/16		47,025
	500	2,3	ION Media Networks, Inc., 8.493%, 1/15/12		501,250
	485		Idearc, Inc., 8.00%, 11/15/16		486,212
	405		Network Communications, Inc., 10.75%, 12/01/13		407,531
	1,500		News America, Inc., 6.20%, 12/15/34		1,454,229
	560		Nexstar Finance, Inc., 7.00%, 1/15/14		537,600
			Nielsen Finance LLC/Nielsen Finance Co.,
	220	6	9.115%, 8/01/16		158,950
	710		10.00%, 8/01/14		747,275
	945		RH Donnelley Corp., Ser. A-3, 8.875%, 1/15/16		945,000
	70		Sinclair Broadcast Group, Inc., 4.875%, 7/15/18		63,459
	80		Sirius Satellite Radio, Inc., 9.625%, 8/01/13		79,500
	1,000		TCI Communications, Inc., 7.875%, 2/15/26		1,138,691
	750	2	TL Acquisitions, Inc., 10.50%, 1/15/15		746,250
	275	2	Univision Communications, Inc., 9.75%, 3/15/15		269,500
	445		Vertis, Inc., 9.75%, 4/01/09		445,000
	85		Viacom, Inc., 6.625%, 5/15/11		88,370
	370		Young Broadcasting, Inc., 10.00%, 3/01/11		347,800
			Total Media		13,999,549
Real Estate—0.5%
	500		ERP Operating LP, 6.95%, 3/02/11		521,745
Technology—3.8%
			Amkor Technology, Inc.,
	50		7.75%, 5/15/13		48,375
	90		9.25%, 6/01/16		92,025
	565		Celestica, Inc., 7.625%, 7/01/13 (Canada)		542,400
			Freescale Semiconductor, Inc.,
	540		9.125%, 12/15/14		488,700
	100	3	9.569%, 12/15/14		91,875
	340		NXP BV/NXP Funding LLC, 9.50%, 10/15/15 (Netherlands)		321,300
	345		Sanmina-SCI Corp., 8.125%, 3/01/16		302,738
			SunGard Data Systems, Inc.,
	140		9.125%, 8/15/13		142,800
	610		10.25%, 8/15/15		635,925
	1,010		Superior Essex Communications LLC/Essex Group, Inc.,
			9.00%, 4/15/12		997,375
			Total Technology		3,663,513
Telecommunications—12.2%
	190		Cincinnati Bell, Inc., 7.25%, 7/15/13		190,475
	140		Cricket Communications, Inc., 9.375%, 11/01/14		138,950
			Digicel Group Ltd. (Bermuda)
	170	2	8.875%, 1/15/15		158,746
	540	2	9.125%, 1/15/15		503,957
	130	3	Hawaiian Telcom Communications, Inc., Ser. B,
			10.318%, 5/01/13		131,625
	355		Intelsat Corp., 9.00%, 6/15/16		362,987

See Notes to Financial Statements.
45	ANNUAL REPORT	OCTOBER 31, 2007

Portfolio of Investments as of October 31, 2007	BlackRock Strategic Bond Trust (BHD) (concluded)
	(Percentages shown are based on Net Assets)

Principal Amount (000)			Description	Value
Telecommunications—(cont’d)
			Intelsat Ltd. (Bermuda)
$	85	3	8.886%, 1/15/15	$	86,275
	300		9.25%, 6/15/16		311,250
	170		11.25%, 6/15/16		182,750
	730	3	11.409%, 6/15/13		761,025
	240		Intelsat Subsidiary Holding Co. Ltd., 8.625%, 1/15/15 (Bermuda)		243,600
	90	2	MetroPCS Wireless, Inc., 9.25%, 11/01/14		89,325
	500	2	Nordic Telephone Co. Holdings A.p.S., 8.875%, 5/01/16 (Denmark)		528,750
	410	2,3	Nortel Networks Ltd., 9.493%, 7/15/11 (Canada)		404,875
	125		PanAmSat Corp., 9.00%, 8/15/14		127,500
			Qwest Corp.,
	200		7.875%, 9/01/11		211,000
	340	3	8.944%, 6/15/13		362,525
	1,500		SBC Communications, Inc., 6.45%, 6/15/34		1,558,848
	1,000		Telecom Italia Capital S.A., 4.95%, 9/30/14 (Luxembourg)		957,141
	2,000		Verizon New England, Inc., 6.50%, 9/15/11		2,078,264
	1,000		Vodafone Group Plc, 7.75%, 2/15/10 (United Kingdom)		1,057,537
	590		West Corp., 11.00%, 10/15/16		618,025
	250	2	Wind Acquisition Finance S.A., 10.75%, 12/01/15 (Luxembourg)		278,125
			Windstream Corp.,
	360		8.125%, 8/01/13		380,700
	170		8.625%, 8/01/16		181,900
			Total Telecommunications		11,906,155
Transportation—2.2%
	125		American Airlines, Inc., Ser. 99-1, 7.324%, 4/15/11		123,438
	80		Britannia Bulk Plc, 11.00%, 12/01/11 (United Kingdom)		84,000
	500		Canadian National Railway Co., 6.90%, 7/15/28 (Canada)		542,396
	475		CHC Helicopter Corp., 7.375%, 5/01/14 (Canada)		459,562
	425		Navios Maritime Holdings, Inc., 9.50%, 12/15/14 (Marshall Islands)		449,438
	300		Overseas Shipholding Group, Inc., 8.25%, 3/15/13		309,750
	2402		St. Acquisition Corp., 12.50%, 5/15/17		153,000
			Total Transportation		2,121,584
			Total Corporate Bonds		82,294,635
U.S. Government and Agency Securities—3.9%
			U.S. Treasury Bonds,
	130		4.75%, 2/15/37		129,929
	410		5.375%, 2/15/31		444,210
			U.S. Treasury Notes,
	810		4.125%, 8/15/10		813,924
	1,075		4.25%, 8/15/13-8/15/15		1,077,249
	550		4.875%, 8/15/16		567,359
	710		4.75%, 5/15/14		729,691
			Total U.S. Government and Agency Securities		3,762,362
Trust Preferred Stock—0.7%
	650	2,3,7	Barclays Bank Plc, 8.55% (United Kingdom)		699,144

Shares			Description		Value
Common Stocks—0.2%
	396,568	1,8	Adelphia Recovery Trust	$	29,742
	947	1,8	Critical Care Systems Intl., Inc.		5,919
	6,388	8	Time Warner Cable, Inc.		182,633
			Total Common Stocks		218,294
Preferred Stock—0.0%
	50,000	1	Superior Essex Holding Corp., Ser. A, 9.50%		31,000
			Total Long-Term Investments (cost $87,726,069)		87,005,435

Principal Amount (000)
SHORT-TERM INVESTMENT—9.3%
U.S. Government and Agency Discount Notes—9.3%
$	9,000	9	Federal Home Loan Bank Disc. Notes, 4.401%, 11/01/07 (cost $9,000,000)		9,000,000
Total investments—98.6% (cost $96,726,06910)				$	96,005,435
Other assets in excess of liabilities—1.4%					1,404,288
Net Assets—100%				$	97,409,723

1	Security is fair valued.
2	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2007, the Trust held 13.4% of its net assets, with a current market value of $13,035,212, in securities restricted as to resale.
3	Variable rate security. Rate shown is interest rate as of October 31, 2007.
4	Entire or partial principal amount pledged as collateral for reverse repurchase agreements. See Note 4 in the Notes to Financial Statements for details of open reverse repurchase agreements.
5	Illiquid security. As of October 31, 2007, the Trust held 0.6% of its net assets, with a current market value of $564,635, in these securities.
6	Represents a step up bond; the interest rate shown reflects the effective yield at the time of purchase.
7	The security is a perpetual bond and has no stated maturity date.
8	Non-income producing security.
9	Rate shown is the yield to maturity as of the date of purchase.
10	Cost for federal income tax purposes is $96,796,459. The net unrealized depreciation on a tax basis is $791,024, consisting of $1,347,299 gross unrealized appreciation and $2,138,323 gross unrealized depreciation.

For Trust compliance purposes, the Trust’s sector and industry classifications refer to any one or more of the Standard Industry Codes as defined by the SEC. This definition may not apply for purposes of this report, which may combine sector and industry sub-classifications for reporting ease.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	46

Statements of Assets and Liabilities

October 31, 2007	BlackRock Broad Investment Grade 2009 Term Trust Inc.1 (BCT)			BlackRock Core Bond Trust (BHK)			BlackRock High Yield Trust (BHY)			BlackRock Income Opportunity Trust (BNA)			BlackRock Income Trust Inc. (BKT)
Assets
Investments at value, unaffiliated2	$	39,361,651		$	667,583,920		$	59,618,159		$	725,931,579		$	483,248,453
Investments at value, affiliated3		—			933,463			—			100,407			50,019
Investments in affiliates		21,616			83,837			31,411			156,215			187,780
Cash		179,354			184,465			63,169			23,022			210,894
Foreign currency at value4		—			17,962			—			—			—
Receivable from investments sold		—			79,414,032			298,143			118,755,429			298,981,807
Variation margin receivable		—			285,126			—			196,616			2,503,972
Unrealized gain on foreign currency exchange contracts		—			21,131			—			—			—
Interest receivable		191,706			5,893,932			1,376,913			6,113,470			3,266,783
Unrealized appreciation on interest rate swaps		—			5,366,013			—			6,167,813			19,676,308
Other assets		—			1,126			1,105			1,684			2,960
		39,754,327			759,785,007			61,388,900			857,446,235			808,128,976
Liabilities
Reverse repurchase agreements		—			103,353,692			—			105,261,512			33,895,363
Payable for investments purchased		—			194,609,753			1,124,884			264,757,861			252,599,751
Variation margin payable		—			—			—			—			—
Unrealized loss on foreign currency exchange contracts		—			—			—			—			—
Loans payable		—			—			9,250,000			—			—
Borrowed bonds at value5		—			80,405,639			—			85,300,660			35,402,682
Investments sold short at value		—			—			—			—			—
Outstanding options written at value6		—			1,554,341			—			1,712,207			11,216,778
TBA sale commitments7		—			4,630,377			—			13,225,372			50,770,896
Unrealized depreciation on interest rate swaps		—			4,709,585			—			5,365,027			960,832
Unrealized depreciation on credit default swaps		—			462			—			98			—
Interest payable		—			982,884			46,037			1,321,187			1,030,721
Deferred income liability		—			—			—			—			—
Interest rate floors at value		—			—			—			—			3,683,965
Cash received as collateral		—			600,000			—			200,000			—
Dividends payable		6,990			58,217			3,833			51,466			86,657
Investment advisory fees payable		18,502			217,707			54,216			192,939			230,091
Administration fees payable		5,046			—			5,163			32,156			53,098
Deferred Trustees’ fees		21,616			83,837			31,411			156,215			187,780
Payable to affiliates		—			11,894			316			9,053			14,467
Trustees’ fees		8,518			7,882			1,667			7,560			6,507
Other accrued expenses		124,676			223,510			89,117			248,045			338,437
		185,348			391,449,780			10,606,644			477,841,358			390,478,025
Preferred Shares at Redemption Value
$0.001 par value per share and $25,000 liquidation value per share, including dividends payable8		—			—			—			—			—
Net Assets Applicable to Common Shareholders	$	39,568,979		$	368,335,227		$	50,782,256		$	379,604,877		$	417,650,951
Composition of Net Assets Applicable to Common Shareholders
Par value9	$	29,571		$	27,019		$	6,419		$	344,497		$	639,425
Paid-in capital in excess of par		38,164,047			380,862,247			90,440,587			402,495,300			480,038,780
Cost of shares held in treasury10		—			—			—			(17,377,850	)		—
Undistributed (distributions in excess of) net investment income		4,863,653			(1,696,051	)		116,650			768,824			(6,313,294	)
Accumulated net realized gain (loss)		(3,222,230	)		(9,982,656	)		(36,529,058	)		(5,053,727	)		(62,361,817	)
Net unrealized appreciation (depreciation)		(266,062	)		(875,332	)		(3,252,342	)		(1,572,167	)		5,647,857
Net assets applicable to common shareholders, October 31, 2007	$	39,568,979		$	368,335,227		$	50,782,256		$	379,604,877		$	417,650,951
Net asset value11	$	13.38		$	13.63		$	7.91		$	11.02		$	6.53
1 Consolidated Statement of Assets and Liabilities
2 Investments at cost, unaffiliated	$	39,627,713		$	669,290,048		$	62,870,501		$	728,241,712		$	489,276,096
3 Investments at cost, affiliated	$	—		$	926,771		$	—		$	105,884		$	52,584
4 Foreign currency at cost	$	—		$	17,603		$	—		$	—		$	—
5 Proceeds received	$	—		$	80,372,938		$	—		$	85,264,516		$	34,289,344
6 Premiums received	$	—		$	2,261,545		$	—		$	2,478,560		$	9,904,416
7 Proceeds for TBA sale commitments	$	—		$	4,627,832		$	—		$	13,086,862		$	49,863,740
8 Preferred shares outstanding		—			—			—			—			—
9 Par value per share	$	0.010		$	0.001		$	0.001		$	0.010		$	0.010
10 Shares held in treasury		—			—			—			1,757,400			—
11 Common shares outstanding		2,957,093			27,018,774			6,418,859			34,449,693			63,942,536

See Notes to Financial Statements.

47 ANNUAL REPORT OCTOBER 31, 2007

October 31, 2007	BlackRock Limited Duration Income Trust (BLW)			BlackRock Preferred and Equity Advantage Trust (BTZ)			BlackRock Strategic Bond Trust (BHD)
Assets
Investments at value, unaffiliated2	$	916,465,094		$	1,645,791,043		$	96,005,435
Investments at value, affiliated3		—			—			—
Investments in affiliates		77,688			—			16,994
Cash		459,217			2,433,274			25,014
Foreign currency at value4		131,351			—			—
Receivable from investments sold		7,605,343			17,269,931			381,617
Variation margin receivable		—			3,860,541			—
Unrealized gain on foreign currency exchange contracts		—			—			—
Interest receivable		14,216,297			18,988,818			1,752,232
Unrealized appreciation on interest rate swaps		—			—			—
Other assets		1,796			1,756			1,101
		938,956,786			1,688,345,363			98,182,393
Liabilities
Reverse repurchase agreements		109,286,907			88,290,625			413,123
Payable for investments purchased		140,394,085			7,757,330			152,692
Variation margin payable		39,234			—			—
Unrealized loss on foreign currency exchange contracts		922,551			—			—
Loans payable		—			—			—
Borrowed bonds at value5		—			13,759,975			—
Investments sold short at value		—			440,135			—
Outstanding options written at value6		—			4,130,100			—
TBA sale commitments7		—			—			—
Unrealized depreciation on interest rate swaps		—			—			—
Unrealized depreciation on credit default swaps		313,338			—			—
Interest payable		3,774,842			245,379			—
Deferred income liability		65,081			—			—
Interest rate floors at value		—			—			—
Cash received as collateral		—			—			—
Dividends payable		260,642			1,522,131			20,589
Investment advisory fees payable		371,728			929,772			49,601
Administration fees payable		—			—			—
Deferred Trustees’ fees		77,688			—			16,994
Payable to affiliates		22,039			25,990			6,950
Trustees’ fees		10,448			11,625			4,714
Other accrued expenses		308,782			421,347			108,007
		255,847,365			117,534,409			772,670
Preferred Shares at Redemption Value
$0.001 par value per share and $25,000 liquidation value per share, including dividends payable8		—			462,276,473			—
Net Assets Applicable to Common Shareholders	$	683,109,421		$	1,108,534,481		$	97,409,723
Composition of Net Assets Applicable to Common Shareholders
Par value9	$	36,890		$	51,828		$	7,058
Paid-in capital in excess of par		701,305,214			1,206,156,456			98,443,594
Cost of shares held in treasury10		—			—			—
Undistributed (distributions in excess of) net investment income		800,386			(276,473	)		197,208
Accumulated net realized gain (loss)		(172,492	)		(45,444,375	)		(517,503	)
Net unrealized appreciation (depreciation)		(18,860,577	)		(51,952,955	)		(720,634	)
Net assets applicable to common shareholders, October 31, 2007	$	683,109,421		$	1,108,534,481		$	97,409,723
Net asset value11	$	18.52		$	21.39		$	13.80
1 Consolidated Statement of Assets and Liabilities
2 Investments at cost, unaffiliated	$	933,594,349		$	1,693,312,884		$	96,726,069
3 Investments at cost, affiliated	$	—		$	—		$	—
4 Foreign currency at cost	$	130,848		$	—		$	—
5 Proceeds received	$	—		$	14,285,318		$	—
6 Premiums received	$	—		$	5,426,127		$	—
7 Proceeds for TBA sale commitments	$	—		$	—		$	—
8 Preferred shares outstanding		—			18,480			—
9 Par value per share	$	0.001		$	0.001		$	0.001
10 Shares held in treasury		—			—			—
11 Common shares outstanding		36,889,650			51,828,157			7,058,402

ANNUAL REPORT OCTOBER 31, 2007 48

Statements of Operations

For the year ended October 31, 2007	BlackRock Broad Investment Grade 2009 Term Trust Inc.1 (BCT)		BlackRock Core Bond Trust (BHK)			BlackRock High Yield Trust (BHY)			BlackRock Income Opportunity Trust (BNA)			BlackRock Income Trust Inc. (BKT)
Investment Income
Interest income	$	2,158,502	$	25,484,417		$	6,149,702		$	28,944,530		$	30,455,219
Dividend income		—		32,154			12,606			29,926			—
Foreign taxes withheld		—		—			—			(2,097	)		—
Income from affiliates		334		4,101			853			6,247			8,557
Affiliated income		—		52,860			—			63,456			3,731
Total investment income		2,158,836		25,573,532			6,163,161			29,042,062			30,467,507
Expenses
Investment advisory		221,437		2,263,497			727,265			2,268,956			2,680,534
Administration		60,392		—			69,263			378,159			618,585
Transfer agent		9,182		14,489			14,192			21,836			66,456
Custodian		63,355		249,091			113,949			231,868			268,396
Reports to shareholders		30,278		102,521			33,297			118,718			155,712
Directors/Trustees		10,093		35,499			5,698			35,718			36,317
Registration		932		11,073			10,987			15,345			25,782
Independent accountants		43,608		75,556			44,407			75,692			75,973
Legal		8,402		63,123			47,523			56,054			53,381
Officers’ fees		973		8,848			1,217			9,108			10,206
Insurance		2,087		20,151			3,620			22,254			25,791
Organization		—		—			—			—			—
Auction agent		—		—			—			—			—
Deferred Trustees’ fees		334		4,101			853			6,247			8,557
Miscellaneous		16,158		42,697			16,125			44,253			48,243
Total expenses excluding interest expense and excise tax		467,231		2,890,646			1,088,396			3,284,208			4,073,933
Interest expense		—		2,986,285			1,050,907			4,308,893			7,442,611
Excise tax		283,057		—			—			—			—
Total expenses		750,288		5,876,931			2,139,303			7,593,101			11,516,544
Less advisory fees waived		—		—			—			—			—
Less fees paid indirectly		—		(9,486	)		(8,027	)		(12,757	)		(22,750	)
Net expenses		750,288		5,867,445			2,131,276			7,580,344			11,493,794
Net investment income		1,408,548		19,706,087			4,031,885			21,461,718			18,973,713
Realized and Unrealized Gain (Loss)
Net realized gain on:
Investments		16,829		2,932,807			(2,479,994	)		2,379,781			5,100,250
Foreign currency		—		(243,679	)		—			1,864			—
Futures and swaps		—		(2,641,007	)		5,700			(561,310	)		(14,906,137	)
Interest rate floors		—		3,316			—			3,654			3,623
Options written		—		472,353			23,138			505,900			66,100
Short sales		—		(181,836	)		1,000			(216,750	)		(631,861	)
		16,829		341,954			(2,450,156	)		2,113,139			(10,368,025	)
Net change in unrealized appreciation on:
Investments		23,668		1,396,645			2,730,808			34,707			9,813,510
Foreign currency		—		84,610			—			—			—
Futures and swaps		—		(4,729,198	)		—			(5,924,500	)		14,400,816
Interest rate floors		—		—			—			—			(993,376	)
Options written		—		(224,655	)		—			(232,716	)		(2,301,793	)
Short sales and borrowed bonds		—		(35,246	)		—			39,033			(2,547,439	)
		23,668		(3,507,844	)		2,730,808			(6,083,476	)		18,371,718
Net gain (loss)		40,497		(3,165,890	)		280,652			(3,970,337	)		8,003,693
Dividends from Net Investment Income to Preferred Shareholders		—		—			—			—			—
Net Increase (Decrease) in Net Assets Applicable to Common Shareholders Resulting from Operations	$	1,449,045	$	16,540,197		$	4,312,537		$	17,491,381		$	26,977,406

1	Consolidated Statement of Operations.
2	Commencement of investment of operations for Preferred and Equity Advantage Trust was December 27, 2006. This information includes the initial investment by BlackRock Funding, Inc.

See Notes to Financial Statements.
49	ANNUAL REPORT	OCTOBER 31, 2007

For the year ended October 31, 2007	BlackRock Limited Duration Income Trust (BLW)		BlackRock Preferred and Equity Advantage Trust2 (BTZ)			BlackRock Strategic Bond Trust (BHD)
Investment Income
Interest income	$	70,129,223	$	59,961,405		$	7,972,023
Dividend income		25,138		23,665,646			6,407
Foreign taxes withheld		—		(72,205	)		—
Income from affiliates		4,008		—			629
Affiliated income		—		—			—
Total investment income		70,158,369		83,554,846			7,979,059
Expenses
Investment advisory		4,890,429		9,017,835			791,363
Administration		—		—			—
Transfer agent		13,687		12,720			13,605
Custodian		458,823		194,874			99,288
Reports to shareholders		192,757		140,899			31,092
Directors/Trustees		42,093		42,388			10,395
Registration		16,509		14,642			10,969
Independent accountants		52,443		53,616			40,196
Legal		82,107		56,724			16,601
Officers’ fees		16,420		27,170			2,349
Insurance		47,141		55,998			5,517
Organization		—		15,000			—
Auction agent		—		766,268			—
Deferred Trustees’ fees		4,008		—			629
Miscellaneous		67,545		73,222			14,377
Total expenses excluding interest expense and excise tax		5,883,962		10,471,356			1,036,381
Interest expense		9,171,719		8,445,410			389,572
Excise tax		—		14,538			—
Total expenses		15,055,681		18,931,304			1,425,953
Less advisory fees waived		—		—			(176,670	)
Less fees paid indirectly		(116,925)		(150,583	)		(5,761	)
Net expenses		14,938,756		18,780,721			1,243,522
Net investment income		55,219,613		64,774,125			6,735,537
Realized and Unrealized Gain (Loss)
Net realized gain on:
Investments		5,056,888		(1,920,106	)		999,009
Foreign currency		(2,379,054)		—			—
Futures and swaps		442,248		(29,263,030	)		—
Interest rate floors		—		—			—
Options written		—		(18,088,249	)		—
Short sales		—		3,748,880			—
		3,120,082		(45,522,505	)		999,009
Net change in unrealized appreciation on:
Investments		(19,529,245)		(47,521,841	)		(1,416,472	)
Foreign currency		(918,619)		—			—
Futures and swaps		(773,728)		(5,812,349	)		—
Interest rate floors		—		—			—
Options written		—		1,296,027			—
Short sales and borrowed bonds		—		85,208			—
		(21,221,592)		(51,952,955	)		(1,416,472	)
Net gain (loss)		(18,101,510)		(97,475,460	)		(417,463	)
Dividends from Net Investment Income to Preferred Shareholders		—		(16,313,570	)		—
Net Increase (Decrease) in Net Assets Applicable to Common Shareholders Resulting from Operations	$	37,118,103	$	(49,014,905	)	$	6,318,074

ANNUAL REPORT OCTOBER 31, 2007 50

Statements of Cash Flows

For the Year Ended October 31, 2007	BlackRock Core Bond Trust (BHK)			BlackRock High Yield Trust (BHY)			BlackRock Income Opportunity Trust (BNA)
Cash Flows Provided by (Used for) Operating Activities
Net increase (decrease) in net assets resulting from operations, excluding dividends to preferred shareholders	$	16,540,197		$	4,312,537		$	17,491,381
Adjustments to Reconcile Net Increase (Decrease) in Net Assets Resulting from Operations to Net Cash from Operating Activities
Purchases of long-term investments		(1,941,701,638	)		(45,730,396	)		(2,429,447,517	)
Proceeds from sales of long-term investments		1,733,431,910			53,761,581			2,211,685,787
Net proceeds (purchases) of short-term investments		889,872			1,609,785			4,896,196
Decrease (Increase) in borrowed bond agreements		(80,490,000	)		—			(85,383,875	)
Amortization of premium and discount on investments		2,145,093			(52,354	)		1,397,029
Net realized loss (gain) on investments		(2,931,258	)		2,479,994			(2,379,781	)
Decrease (Increase) in unrealized appreciation/depreciation on investments		(1,396,645	)		(2,730,808	)		(34,707	)
Net effect of exchange rates on foreign currency		243,678			—			(1,864	)
Increase in investments sold short and borrowed bonds		80,405,639			—			85,300,660
Increase (Decrease) in outstanding options written		(573,431	)		—			(610,347	)
Increase (Decrease) in TBA sale commitments		4,630,377			—			(12,762,315	)
Decrease in interest rate floor		—			—			—
Decrease (Increase) in unrealized appreciation (depreciation) on swaps		1,779,656			—			2,004,890
Decrease (Increase) in credit default swaps		(44,465	)		—			(49,874	)
Increase in investments in affiliates		(4,101	)		(852	)		(6,247	)
Decrease (Increase) in receivable for investments sold		(79,018,214	)		(76,424	)		(92,217,031	)
Decrease in unrealized gain on foreign currency exchange contracts		62,356			—			—
Decrease (Increase) in variation margin receivable		348,212			—			613,478
Decrease (Increase) in interest receivable		(541,245	)		187,539			(563,244	)
Decrease (Increase) in other assets		21,210			2,902			27,891
Increase (Decrease) in payable for investments purchased		183,643,965			1,064,252			251,167,512
Decrease in payable for dollar rolls		—			—			—
Increase in unrealized loss on foreign currency exchange contracts		—			—			—
Increase in variation margin payable		—			—			—
Increase (Decrease) in interest payable		300,147			(40,863	)		444,016
Increase in deferred income		—			—			—
Increase (Decrease) in investment advisory fee payable		70,571			9,609			(1,049	)
Increase (Decrease) in cash with brokers as collateral		—			—			(400,000	)
Increase (Decrease) in administration fee payable		—			3,006			(33,664	)
Increase in Deferred Directors/Trustees’ fees		4,101			852			6,247
Increase (Decrease) in payable to affiliates		(5,945	)		(664	)		3,248
Increase (Decrease) in Officers & Trustees fees		7,882			1,667			7,560
Increase in accrued expenses		44,363			11,260			77,837
Total adjustments		(98,677,910	)		10,500,086			(66,259,164	)
Net cash provided by (used for) operating activities	$	(82,137,713	)	$	14,812,623		$	(48,767,783	)
Cash flows provided by (used for) financing activities:
Capital contributions		—			—			—
Increase (Decrease) in reverse repurchase agreements		99,442,604			—			70,935,354
Draws on loan		—			3,000,000			—
Payments on loan		—			(14,000,000	)		—
Increase in preferred shares at redemption value including dividends payable		—			—			—
Cash dividends paid		(21,664,877	)		(3,911,685	)		(22,685,337	)
Distributions to Preferred Shareholders		—			—			—
Net cash provided by (used for) financing activities:	$	77,777,727		$	(14,911,685	)	$	48,250,017
Net increase (decrease) in cash		(4,359,986	)		(99,062	)		(517,766	)
Cash and foreign currency at beginning of year		4,562,413			162,231			540,788
Cash and foreign currency at end of year	$	202,427		$	63,169		$	23,022
Cash paid during the period for interest	$	2,686,138		$	1,091,770		$	3,864,877
Non cash financing activities not included herein consist of reinvestment of dividends of	$	—		$	12,289		$	—

¹ Commencement of investment of operations for Preferred and Equity Advantage Trust was December 27, 2006. This information includes the initial investment by BlackRock Funding, Inc.

See Notes to Financial Statements.

51 ANNUAL REPORT OCTOBER 31, 2007

For the Year Ended October 31, 2007	BlackRock Income Trust Inc. (BKT)			BlackRock Limited Duration Income Trust (BLW)			BlackRock Preferred and Equity Advantage Trust (BTZ)1
Cash Flows Provided by (Used for) Operating Activities
Net increase (decrease) in net assets resulting from operations, excluding dividends to preferred shareholders	$	26,977,406		$	37,118,103		$	(32,701,335	)
Adjustments to Reconcile Net Increase (Decrease) in Net Assets Resulting from Operations to Net Cash from Operating Activities
Purchases of long-term investments		(2,648,040,603	)		(2,075,694,027	)		(3,036,455,711	)
Proceeds from sales of long-term investments		2,705,505,681			2,184,331,730			1,384,949,447
Net proceeds (purchases) of short-term investments		(453,891	)		(3,048,518	)		(29,250,052	)
Decrease (Increase) in borrowed bond agreements		25,681,719			—			(13,832,286	)
Amortization of premium and discount on investments		12,697,538			2,200,638			(644,388	)
Net realized loss (gain) on investments		(5,100,250	)		(5,056,888	)		1,920,106
Decrease (Increase) in unrealized appreciation/depreciation on investments		(9,813,510	)		19,529,245			47,521,841
Net effect of exchange rates on foreign currency		—			2,379,053			—
Increase in investments sold short and borrowed bonds		(25,665,758	)		—			14,200,110
Increase (Decrease) in outstanding options written		8,893,649			—			4,130,100
Increase (Decrease) in TBA sale commitments		34,189,494			—			—
Decrease in interest rate floor		1,789,109			—			—
Decrease (Increase) in unrealized appreciation (depreciation) on swaps		—			—			—
Decrease (Increase) in credit default swaps		(17,631,968	)		313,338			—
Increase in investments in affiliates		(8,558	)		(4,008	)		—
Decrease (Increase) in receivable for investments sold		(282,517,813	)		(4,213,569	)		(17,269,931	)
Decrease in unrealized gain on foreign currency exchange contracts		—			—			—
Decrease (Increase) in variation margin receivable		(2,503,972	)		—			(3,860,541	)
Decrease (Increase) in interest receivable		1,027,688			1,254,444			(18,988,818	)
Decrease (Increase) in other assets		24,976			56,737			(1,756	)
Increase (Decrease) in payable for investments purchased		252,599,751			828,336			7,757,330
Decrease in payable for dollar rolls		(15,527,433	)		—			—
Increase in unrealized loss on foreign currency exchange contracts		—			885,571			—
Increase in variation margin payable		(1,068,671	)		2,254			—
Increase (Decrease) in interest payable		(572,515	)		3,099,604			245,379
Increase in deferred income		—			65,081			—
Increase (Decrease) in investment advisory fee payable		2,351			(51,146	)		929,772
Increase (Decrease) in cash with brokers as collateral		—			—			—
Increase (Decrease) in administration fee payable		(43,151	)		—			—
Increase in Deferred Directors/Trustees’ fees		8,558			4,008			—
Increase (Decrease) in payable to affiliates		(33,285	)		3,531			25,990
Increase (Decrease) in Officers & Trustees fees		6,507			10,448			11,625
Increase in accrued expenses		174,675			83,711			421,347
Total adjustments		33,620,318			126,979,573			(1,658,190,436	)
Net cash provided by (used for) operating activities		60,597,724		$	164,097,676		$	(1,690,891,771	)
Cash flows provided by (used for) financing activities:
Capital contributions		—			—			1,228,660,977
Increase (Decrease) in reverse repurchase agreements		(36,795,262	)		(110,712,624	)		88,290,625
Draws on loan		—			—			—
Payments on loan		—			—			—
Increase in preferred shares at redemption value including dividends payable		—			—			462,276,473
Cash dividends paid		(23,699,970	)		(52,954,140	)		(69,589,460	)
Distributions to Preferred Shareholders		—			—			(16,313,570	)
Net cash provided by (used for) financing activities:		(60,495,232	)	$	(163,666,764	)	$	1,693,325,045
Net increase (decrease) in cash		102,492			430,912			2,433,274
Cash and foreign currency at beginning of year		108,402			159,656			—
Cash and foreign currency at end of year		210,894		$	590,568		$	2,433,274
Cash paid during the period for interest		7,917,798		$	6,072,115		$	8,163,917
Non cash financing activities not included herein consist of reinvestment of dividends of	$	—		$	2,057,525		$	1,748,836

ANNUAL REPORT OCTOBER 31, 2007 52

Statements of Changes in Net Assets
For the years ended October 31, 2007 and 2006

	BlackRock Broad Investment Grade 2009 Term Trust Inc.1 (BCT)						BlackRock Core Bond Trust (BHK)
Net Increase (Decrease) in Net Assets	2007			2006			2007			2006
Operations
Net investment income	$	1,408,548		$	1,918,798		$	19,706,087		$	17,700,447
Net realized gain (loss)		16,829			(493,395	)		341,954			(8,285,073	)
Net change in unrealized appreciation/depreciation		23,668			341,005			(3,507,844	)		11,551,542
Net increase in net assets resulting from operations		1,449,045			1,766,408			16,540,197			20,966,916
Dividends and Distributions to Common Shareholders from:
Net investment income		(2,661,384	)		(4,191,834	)		(16,495,698	)		(25,048,230	)
Net realized gains		—			(69,260	)		—			(7,914,351	)
Tax return of capital		—			—			(5,227,396	)		—
Total dividends and distributions		(2,661,384	)		(4,261,094	)		(21,723,094	)		(32,962,581	)
Capital Share Transactions:
Reinvestment of common dividends		—			—			—			—
Total increase (decrease)		(1,212,339	)		(2,494,686	)		(5,182,897	)		(11,995,665	)
Net Assets
Beginning of year		40,781,318			43,276,004			373,518,124			385,513,789
End of year	$	39,568,979		$	40,781,318		$	368,335,227		$	373,518,124
End of year undistributed (distribution in excess of) net investment income	$	4,863,653		$	5,833,604		$	(1,696,051	)	$	(5,693,238	)

¹ Consolidated Statement of Changes in Net Assets.

	BlackRock Limited Duration Income Trust (BLW)						BlackRock Preferred and Equity Advantage Trust1 (BTZ)
Net Increase (Decrease) in Net Assets Applicable to Common Shareholders	2007			2006			2007
Operations:
Net investment income	$	55,219,613		$	49,596,055		$	64,774,125
Net realized gain (loss)		3,120,082			(1,589,905	)		(45,522,505	)
Net change in unrealized appreciation/depreciation		(21,221,592	)		2,473,132			(51,952,955	)
Dividends from net investment income to Preferred Shareholders:		—			—			(16,313,570	)
Net increase (decrease) in net assets applicable to common shareholders resulting from operations		37,118,103			50,479,282			(49,014,905	)
Dividends and Distributions to Common Shareholders from:
Net investment income		(51,967,739	)		(55,725,066	)		(48,688,436	)
Net realized gains		(2,229,742	)		—			—
Tax return of capital distributions		(1,074,826	)		(760,960	)		(24,171,991	)
Total dividends and distributions		(55,272,307	)		(56,486,026	)		(72,860,427	)
Capital Share Transactions:
Net from the issuance of common shares		—			—			1,115,290,352
Net proceeds from the underwriters’ over-allotment exercised		—			—			113,370,625
Reinvestment of common dividends		2,057,525			251,427			1,748,836
		2,057,525			251,427			1,230,409,813
Total increase (decrease)		(16,096,679	)		(5,755,317	)		1,108,534,481
Net Assets Applicable to Common Shareholders
Beginning of period		699,206,100			704,961,417			—
End of period	$	683,109,421		$	699,206,100		$	1,108,534,481
End of period undistributed (distribution in excess of) net investment income	$	800,386		$	(36,700	)	$	(276,473	)

¹ Commencement of investment operations for Preferred and Equity Advantage Trust was December 27, 2006. This information includes the initial investment by BlackRock Funding, Inc.

See Notes to Financial Statements.
53	ANNUAL REPORT	OCTOBER 31, 2007

	BlackRock High Yield Trust (BHY)						BlackRock Income Opportunity Trust (BNA)						BlackRock Income Trust Inc. (BKT)
Net Increase (Decrease) in Net Assets	2007			2006			2007			2006			2007			2006
Operations
Net investment income	$	4,031,885		$	4,211,671		$	21,461,718		$	19,514,794		$	18,973,713		$	20,352,044
Net realized gain (loss)		(2,450,156	)		(2,067,969	)		2,113,139			(7,330,378	)		(10,368,025	)		1,937,674
Net change in unrealized appreciation/depreciation		2,730,808			4,444,627			(6,083,476	)		7,965,246			18,371,718			1,267,311
Net increase in net assets resulting from operations		4,312,537			6,588,329			17,491,381			20,149,662			26,977,406			23,557,029
Dividends and Distributions to Common Shareholders from:
Net investment income		(3,927,807	)		(4,175,232	)		(20,862,233	)		(22,238,524	)		(18,808,452	)		(21,910,288	)
Net realized gains		—			—			—			(8,976,694	)		—			—
Tax return of capital		—			—			(1,874,570	)		(2,162,198	)		(4,978,175	)		(5,576,693	)
Total dividends and distributions		(3,927,807	)		(4,175,232	)		(22,736,803	)		(33,377,416	)		(23,786,627	)		(27,486,981	)
Capital Share Transactions:
Reinvestment of common dividends		12,289			48,307			—			—			—			—
Total increase (decrease)		397,019			2,461,404			(5,245,422	)		(13,227,754	)		3,190,779			(3,929,952	)
Net Assets
Beginning of year		50,385,237			47,923,833			384,850,299			398,078,053			414,460,172			418,390,124
End of year	$	50,782,256		$	50,385,237		$	379,604,877		$	384,850,299		$	417,650,951		$	414,460,172
End of year undistributed (distribution in excess of) net investment income	$	116,650		$	10,204		$	768,824		$	(900,730	)	$	(6,313,294	)	$	(519,359	)

	BlackRock Strategic Bond Trust (BHD)
Net Increase (Decrease) in Net Assets Applicable to Common Shareholders	2007			2006
Operations:
Net investment income	$	6,735,537		$	6,965,538
Net realized gain (loss)		999,009			(759,640	)
Net change in unrealized appreciation/depreciation		(1,416,472	)		2,082,388
Dividends from net investment income to Preferred Shareholders:		—			—
Net increase (decrease) in net assets applicable to common shareholders resulting from operations		6,318,074			8,288,286
Dividends and Distributions to Common Shareholders from:
Net investment income		(6,521,963	)		(6,969,104	)
Net realized gains		—			—
Tax return of capital distributions		—			(251,641	)
Total dividends and distributions		(6,521,963	)		(7,220,745	)
Capital Share Transactions:
Net from the issuance of common shares		—			—
Net proceeds from the underwriters’ over-allotment exercised		—			—
Reinvestment of common dividends		—			—
		—			—
Total increase (decrease)		(203,889	)		1,067,541
Net Assets Applicable to Common Shareholders
Beginning of period		97,613,612			96,546,071
End of period	$	97,409,723		$	97,613,612
End of period undistributed (distribution in excess of) net investment income	$	197,208		$	(16,366	)

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	54

Financial Highlights BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)

	Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	13.79		$	14.63		$	15.98		$	16.02		$	17.33
Investment operations:
Net investment income		0.48			0.65			0.80			0.61			1.28
Net realized and unrealized gain (loss)		0.01			(0.05	)		(0.87	)		0.25			(1.40	)
Net increase (decrease) from investment operations		0.49			0.60			(0.07	)		0.86			(0.12	)
Dividends and distributions from:
Net investment income		(0.90	)		(1.42	)		(1.03	)		(0.90	)		(1.19	)
Net realized gains		—			(0.02	)		(0.25	)		—			—
Total dividends and distributions		(0.90	)		(1.44	)		(1.28	)		(0.90	)		(1.19	)
Net asset value, end of year	$	13.38		$	13.79		$	14.63		$	15.98		$	16.02
Market price, end of year	$	15.15		$	15.08		$	15.86		$	15.80		$	15.85
Total Investment Returns1
At net asset value		2.95	%		3.53	%		(0.82	)%		5.52	%		(0.61	)%
At market value		6.60	%		4.44	%		8.74	%		5.45	%		5.32	%
Ratios to Average Net Assets
Total expenses		1.86	%		1.14	%		2.37	%		2.48	%		2.43	%
Net expenses		1.86	%		1.14	%		2.37	%		2.48	%		2.43	%
Net expenses excluding excise tax		1.16	%		1.14	%		1.19	%		1.11	%		1.18	%
Net investment income		3.50	%		4.50	%		5.23	%		3.83	%		7.54	%
Supplemental Data
Average net assets (000)	$	40,261		$	42,625		$	45,264		$	47,191		$	49,882
Portfolio turnover		10	%		8	%		116	%		20	%		39	%
Net assets, end of year (000)	$	39,569		$	40,781		$	43,276		$	47,255		$	47,381
Reverse repurchase agreements outstanding, end of year (000)	$	—		$	—		$	—		$	19,263		$	19,953
Asset coverage, end of year2	$	—		$	—		$	—		$	3,453		$	3,375
Reverse repurchase agreements average daily balance (000)	$	—		$	—		$	7,865		$	22,055		$	19,409
Reverse repurchase agreements weighted average interest rate		—	%		—	%		2.32	%		1.20	%		1.21	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.
The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
55	ANNUAL REPORT	OCTOBER 31, 2007

Financial Highlights BlackRock Core Bond Trust (BHK)

	Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	13.82		$	14.27		$	15.22		$	14.75		$	14.33
Investment operations:
Net investment income		0.74			0.66			0.78			0.92			0.83
Net realized and unrealized gain (loss)		(0.13	)		0.11			(0.37	)		0.66			0.77
Net increase from investment operations		0.61			0.77			0.41			1.58			1.60
Dividends and distributions from:
Net investment income		(0.61	)		(0.93	)		(1.01	)		(0.86	)		(1.00	)
Net realized gains		—			(0.29	)		(0.35	)		(0.25	)		(0.18	)
Tax return of capital		(0.19	)		—			—			—			—
Total dividends and distributions		(0.80	)		(1.22	)		(1.36	)		(1.11	)		(1.18	)
Net asset value, end of year	$	13.63		$	13.82		$	14.27		$	15.22		$	14.75
Market price, end of year	$	12.23		$	12.86		$	13.69		$	14.02		$	13.57
Total Investment Returns1
At net asset value		5.04	%		6.20	%		3.18	%		11.79	%		11.76	%
At market value		1.29	%		3.07	%		7.46	%		11.93	%		6.62	%
Ratios to Average Net Assets
Total expenses		1.60	%		1.08	%		1.50	%		1.32	%		1.05	%
Net expenses		1.60	%		1.08	%		1.50	%		1.32	%		1.05	%
Net expenses excluding interest expense		0.78	%		0.77	%		0.85	%		0.92	%		0.87	%
Net investment income		5.36	%		4.78	%		5.20	%		6.20	%		5.58	%
Supplemental Data
Average net assets (000)	$	367,577		$	370,219		$	402,783		$	401,212		$	401,049
Portfolio turnover		122	%		88	%		220	%		398	%		161	%
Net assets, end of year (000)	$	368,335		$	373,518		$	385,514		$	411,163		$	398,540
Reverse repurchase agreements outstanding, end of year (000)	$	103,354		$	3,911		$	86,876		$	102,474		$	91,668
Asset coverage, end of year2	$	4,564		$	96,502		$	5,438		$	5,012		$	5,348
Reverse repurchase agreements average daily balance (000)	$	44,786		$	25,340		$	91,130		$	145,094		$	67,591
Reverse repurchase agreements weighted average interest rate		5.24	%		4.54	%		2.86	%		1.11	%		1.05	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.
The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	56

Financial Highlights BlackRock High Yield Trust (BHY)

	Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	7.85		$	7.48		$	7.95		$	6.96		$	6.13
Investment operations:
Net investment income		0.63			0.66			0.68			0.92			1.06
Net realized and unrealized gain (loss)		0.04			0.36			(0.36	)		1.02			0.89
Net increase from investment operations		0.67			1.02			0.32			1.94			1.95
Dividends and distributions from:
Net investment income		(0.61	)		(0.65	)		(0.79	)		(0.92	)		(1.07	)
Tax return of capital		—			—			—			(0.03	)		(0.05	)
Total dividends and distributions		(0.61	)		(0.65	)		(0.79	)		(0.95	)		(1.12	)
Net asset value, end of year	$	7.91		$	7.85		$	7.48		$	7.95		$	6.96
Market price, end of year	$	6.92		$	7.77		$	7.36		$	9.30		$	10.25
Total Investment Returns1
At net asset value		9.03	%		14.25	%		2.85	%		26.24	%		27.75	%
At market value		(3.63	) %		14.93	%		(13.49	) %		0.28	%		32.87	%
Ratios to Average Net Assets
Total expenses		4.16	%		4.50	%		3.52	%		2.69	%		3.07	%
Net expenses		4.14	%		4.49	%		3.51	%		2.68	%		3.07	%
Net expenses excluding interest expense		2.10	%		2.19	%		2.10	%		1.96	%		2.22	%
Net investment income		7.84	%		8.74	%		8.71	%		12.16	%		16.37	%
Supplemental Data
Average net assets (000)	$	51,435		$	48,176		$	50,104		$	48,186		$	41,326
Portfolio turnover		69	%		85	%		102	%		156	%		30	%
Net assets, end of year (000)	$	50,782		$	50,385		$	47,924		$	50,914		$	44,438
Loan outstanding, end of year (000)	$	9,250		$	20,250		$	20,750		$	19,250		$	19,250
Asset coverage, end of year2	$	6,490		$	3,488		$	3,310		$	3,645		$	3,308
Loan average daily balance (000)	$	17,710		$	20,621		$	20,425		$	19,250		$	19,250
Loan weighted average interest rate		5.28	%		4.75	%		2.87	%		1.80	%		1.96	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.
The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
57	ANNUAL REPORT	OCTOBER 31, 2007

Financial Highlights BlackRock Income Opportunity Trust (BNA)

	Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	11.17		$	11.56		$	12.38		$	11.93		$	11.83
Investment operations:
Net investment income		0.62			0.57			0.72			0.76			0.84
Net realized and unrealized gain (loss)		(0.11	)		0.01			(0.45	)		0.53			0.31
Net increase from investment operations		0.51			0.58			0.27			1.29			1.15
Dividends and distributions from:
Net investment income		(0.61	)		(0.65	)		(0.81	)		(0.84	)		(0.81	)
Net realized gains		—			(0.26	)		(0.28	)		—			(0.24	)
Tax return of capital		(0.05	)		(0.06	)		—			—			—
Total dividends and distributions		(0.66	)		(0.97	)		(1.09	)		(0.84	)		(1.05	)
Net asset value, end of year	$	11.02		$	11.17		$	11.56		$	12.38		$	11.93
Market price, end of year	$	10.19		$	10.58		$	10.90		$	11.38		$	10.95
Total Investment Returns1
At net asset value		5.11	%		5.76	%		2.95	%		11.90	%		10.92	%
At market value		2.62	%		6.27	%		5.53	%		12.04	%		14.71	%
Ratios to Average Net Assets
Total expenses		2.01	%		1.61	%		1.72	%		1.11	%		1.29	%
Net expenses		2.00	%		1.61	%		1.72	%		1.11	%		1.29	%
Net expenses excluding interest expense		0.87	%		0.89	%		0.87	%		0.84	%		0.89	%
Net investment income		5.68	%		5.11	%		5.97	%		6.29	%		6.99	%
Supplemental Data
Average net assets (000)	$	378,159		$	381,726		$	413,777		$	415,131		$	413,543
Portfolio turnover		196	%		131	%		396	%		300	%		46	%
Net assets, end of year (000)	$	379,605		$	384,850		$	398,078		$	426,643		$	410,981
Reverse repurchase agreements outstanding, end of year (000)	$	105,262		$	34,326		$	120,179		$	94,644		$	103,378
Asset coverage, end of year2	$	4,606		$	12,212		$	4,312		$	5,508		$	4,976
Reverse repurchase agreements average daily balance (000)	$	68,241		$	59,691		$	122,457		$	97,264		$	136,172
Reverse repurchase agreements weighted average interest rate		5.27	%		4.59	%		2.87	%		1.14	%		1.22	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.
The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	58

Financial Highlights BlackRock Income Trust Inc. (BKT)

	Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	6.48		$	6.54		$	6.95		$	7.21		$	8.13
Investment operations:
Net investment income		0.30			0.32			0.44			0.51			0.61
Net realized and unrealized gain (loss)		0.12			0.05			(0.30	)		(0.16	)		(0.52	)
Net increase from investment operations		0.42			0.37			0.14			0.35			0.09
Dividends and distributions from:
Net investment income		(0.29	)		(0.34	)		(0.48	)		(0.61	)		(1.01	)
Tax return of capital		(0.08	)		(0.09	)		(0.07	)		—			—
Total dividends and distributions		(0.37	)		(0.43	)		(0.55	)		(0.61	)		(1.01	)
Net asset value, end of year	$	6.53		$	6.48		$	6.54		$	6.95		$	7.21
Market price, end of year	$	5.81		$	6.07		$	5.90		$	7.50		$	7.71
Total Investment Returns1
At net asset value		7.06	%		6.06	%		2.12	%		5.01	%		1.20	%
At market value		1.69	%		10.18	%		(14.63	)%		5.97	%		15.41	%
Ratios to Average Net Assets
Total expenses		2.77	%		2.85	%		2.80	%		1.37	%		1.36	%
Net expenses		2.76	%		2.84	%		2.79	%		1.37	%		1.36	%
Net expenses excluding interest expense		0.98	%		1.00	%		0.99	%		0.97	%		1.02	%
Net investment income		4.60	%		4.92	%		6.54	%		7.13	%		8.18	%
Supplemental Data
Average net assets (000)	$	412,390		$	413,597		$	430,035		$	447,984		$	472,676
Portfolio turnover		250	%		80	%		60	%		120	%		64	%
Net assets, end of year (000)	$	417,651		$	414,460		$	418,390		$	442,635		$	457,301
Reverse repurchase agreements outstanding, end of year (000)	$	33,895		$	70,691		$	149,558		$	223,736		$	121,767
Asset coverage, end of year2	$	13,322		$	6,863		$	3,798		$	2,978		$	4,756
Reverse repurchase agreements average daily balance (000)	$	93,325		$	104,393		$	180,553		$	158,278		$	135,804
Reverse repurchase agreements weighted average interest rate		5.21	%		4.54	%		2.81	%		1.12	%		1.17	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.

The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
59	ANNUAL REPORT	OCTOBER 31, 2007

Financial Highlights BlackRock Limited Duration Income Trust (BLW)

	Year Ended October 31,												For the Period July 30, 20031 through October 31, 2003
	2007			2006			2005			2004
Per Share Operating Performance
Net asset value, beginning of year	$	19.01		$	19.17		$	20.13		$	19.74			$	19.10	2
Investment operations:
Net investment income		1.50			1.35			1.46			1.46				0.33
Net realized and unrealized gain (loss)		(0.49	)		0.03			(0.94	)		0.43				0.60
Net increase from investment operations		1.01			1.38			0.52			1.89				0.93
Dividends and distributions from:
Net investment income		(1.41	)		(1.52	)		(1.33	)		(1.49	)			(0.25	)
Net realized gains		(0.06	)		—			(0.15	)		(0.01	)			—
Tax return of capital		(0.03	)		(0.02	)		—			—				—
Total dividends and distributions		(1.50	)		(1.54	)		(1.48	)		(1.50	)			(0.25	)
Capital charges with respect to issuance of Common shares		—			—			—			—				(0.04	)
Net asset value, end of year	$	18.52		$	19.01		$	19.17		$	20.13			$	19.74
Market price, end of year	$	16.68		$	18.85		$	17.48		$	19.95			$	18.80
Total Investment Returns3
At net asset value		5.66	%		7.85	%		2.93	%		10.17	%			4.71	%
At market value		(4.03	)%		17.31	%		(5.30	)%		14.64	%			(4.77	)%
Ratios to Average Net Assets
Total expenses		2.16	%		2.20	%		1.71	%		1.26	%			0.82	%4
Net expenses		2.14	%		2.19	%		1.71	%		1.25	%			0.82	%4
Net expenses excluding interest expense		0.83	%		0.91	%		0.92	%		0.90	%			0.79	%4
Net investment income		7.92	%		7.10	%		7.42	%		7.34	%			6.87	%4
Supplemental Data
Average net assets (000)	$	696,946		$	698,382		$	722,668		$	730,369			$	686,655
Portfolio turnover		65	%		132	%		70	%		215	%			127	%
Net assets, end of year (000)	$	683,109		$	699,206		$	704,961		$	739,225			$	724,747
Reverse repurchase agreements outstanding, end of year (000)	$	109,287		$	220,000		$	176,010		$	159,416			$	118,993
Asset coverage, end of year5	$	7,251		$	4,178		$	5,005		$	5,637			$	7,091
Reverse repurchase agreements average daily balance (000)	$	172,040		$	179,366		$	186,660		$	195,845			$	26,591
Reverse repurchase agreements weighted average interest rate		5.28	%		4.96	%		3.08	%		1.32	%			0.76	%

1	Commencement of investment operations. This information includes the initial investment by BlackRock Funding, Inc.
2	Net asset value, beginning of period, reflects a deduction of $0.90 per share sales charge from the initial offering price of $20.00 per share.
3	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
4	Annualized.
5	Per $1,000 of reverse repurchase agreements outstanding.

The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	60

Financial Highlights BlackRock Preferred and Equity Advantage Trust (BTZ)

	For the Period December 27, 20061 through October 31, 2007
Per Common Share Operating Performance
Net asset value, beginning of period		$	23.88	2
Investment operations:
Net investment income			1.25
Net realized and unrealized gain (loss)			(1.86	)
Dividends to preferred shareholders from net investment income			(0.31	)
Net increase (decrease) from investment operations			(0.92	)
Dividends and distributions to common shareholders from:
Net investment income			(0.93	)
Tax return of capital			(0.47	)
Total dividends and distributions			(1.40	)
Capital charges with respect to issuance of:
Common shares			(0.04	)
Preferred shares			(0.13	)
Total capital charges			(0.17	)
Net asset value, end of period		$	21.39
Market price, end of period		$	18.65
Total Investment Returns3
At net asset value			(4.42	)%
At market value			(20.34	)%
Ratios to Average Net Assets of Common Shareholders4,5
Total expenses			1.90	%
Net expenses			1.88	%
Net expenses excluding interest expense and excise tax			1.04	%
Net investment income available to common shareholders			4.86	%
Preferred share dividends			1.64	%
Supplemental Data
Average net assets of common shareholders (000)		$	1,177,716
Portfolio turnover			35	%
Net assets applicable to common shareholders, end of period (000)		$	1,108,534
Reverse repurchase agreements outstanding, end of period (000)		$	88,291
Asset coverage per preferred share, end of period3		$	89,737
Reverse repurchase agreements average daily balance (000)		$	96,468
Reverse repurchase agreements weighted average interest rate			5.32	%

1	Commencement of investment operations. This information includes the initial investment by BlackRock Funding, Inc.
2	Net asset value, beginning of period, reflects a deduction of $1.125 per share sales charge from the initial offering price of $25.00 per share.
3	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
4	Annualized.
5	Ratios are calculated on the basis of income and expenses applicable to both the common and preferred shares relative to the average net assets of the common shareholders.

The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
61	ANNUAL REPORT	OCTOBER 31, 2007

Financial Highlights BlackRock Strategic Bond Trust (BHD)

		Year Ended October 31,
	2007			2006			2005			2004			2003
Per Share Operating Performance
Net asset value, beginning of year	$	13.83		$	13.68		$	15.10		$	15.07		$	12.63
Investment operations:
Net investment income		0.95			0.99			1.10			1.39			1.59
Net realized and unrealized gain (loss)		(0.06	)		0.18			(1.13	)		0.25			2.34
Net increase (decrease) from investment operations		0.89			1.17			(0.03	)		1.64			3.93
Dividends and distributions from:
Net investment income		(0.92	)		(0.98	)		(1.12	)		(1.61	)		(1.49	)
Tax return of capital		—			(0.04	)		(0.27	)		—			—
Total dividends and distributions		(0.92	)		(1.02	)		(1.39	)		(1.61	)		(1.49	)
Net asset value, end of year	$	13.80		$	13.83		$	13.68		$	15.10		$	15.07
Market price, end of year	$	11.88		$	12.85		$	12.45		$	16.70		$	15.27
Total Investment Returns1
At net asset value		7.26	%		9.58	%		(0.49	)%		11.35	%		32.55	%
At market value		(0.62	)%		11.87	%		(18.11	)%		21.54	%		37.36	%
Ratios to Average Net Assets
Total expenses		1.45	%		2.25	%		2.14	%		1.49	%		2.01	%
Net expenses		1.27	%		2.00	%		1.87	%		1.23	%		1.71	%
Net expenses excluding interest expense		0.87	%		0.94	%		0.92	%		0.89	%		1.01	%
Net investment income		6.86	%		7.26	%		7.58	%		9.23	%		11.32	%
Supplemental Data
Average net assets (000)	$	98,130		$	96,003		$	101,990		$	106,330		$	98,498
Portfolio turnover		34	%		56	%		51	%		31	%		32	%
Net assets, end of year (000)	$	97,410		$	97,614		$	96,546		$	106,433		$	106,045
Reverse repurchase agreements outstanding, end of year (000)	$	413		$	14,951		$	31,883		$	13,188		$	45,872
Asset coverage, end of year2	$	236,789		$	7,529		$	4,028		$	9,071		$	3,312
Reverse repurchase agreements average daily balance (000)	$	7,240		$	21,104		$	30,406		$	27,562		$	46,036
Reverse repurchase agreements weighted average interest rate		5.34	%		4.81	%		3.20	%		1.33	%		1.51	%

1	Total investment return at market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns excludes the effects of brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results.
2	Per $1,000 of reverse repurchase agreements outstanding.

The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market price data for the Trust’s common shares.

See Notes to Financial Statements.
	ANNUAL REPORT	OCTOBER 31, 2007	62

Notes to Financial Statements

Note 1. Organization & Accounting Policies

BlackRock Broad Investment Grade 2009 Term Trust Inc. (“Broad Investment Grade”), BlackRock Core Bond Trust (“Core Bond”), BlackRock High Yield Trust (“High Yield”), BlackRock Income Opportunity Trust (“Income Opportunity”), BlackRock Income Trust Inc. (“Income Trust”), BlackRock Limited Duration Income Trust (“Limited Duration”) and BlackRock Strategic Bond Trust (“Strategic Bond”) are registered as diversified, closed-end management investment companies under the Investment Company Act of 1940, as amended (the “1940 Act”). BlackRock Preferred and Equity Advantage Trust (“Preferred and Equity”) is registered as a non-diversified, closed-end management investment company under the 1940 Act. Broad Investment Grade, Income Opportunity and Income Trust are organized as Maryland corporations. Core Bond, High Yield, Limited Duration and Strategic Bond are organized as Delaware statutory trusts. Broad Investment Grade, Core Bond, High Yield, Income Opportunity, Income Trust, Limited Duration, Preferred and Equity and Strategic Bond are individually referred to as a “Trust” and collectively as the “Trusts”.

Preferred and Equity was organized on October 26, 2006 and had no transactions until November 21, 2006 when the Trust sold 4,817 common shares for $115,006 to BlackRock Funding, Inc. Investment operations for Preferred and Equity commenced on December 27, 2006. The Trust incurred organization costs which were deferred from the organization date until the commencement of operations.

On December 3, 1999, Broad Investment Grade transferred a substantial portion of its total assets to a 100% owned registered investment company subsidiary called BCT Subsidiary, Inc. The financial statements and these notes to the financial statements for Broad Investment Grade are consolidated and include the operations of both Broad Investment Grade and its wholly owned subsidiary after elimination of all intercompany transactions and balances.

The following is a summary of significant accounting policies followed by the Trusts.

Investments Valuation: The Trusts value most of their investments on the basis of current market quotations provided by dealers or pricing services selected under the supervision of each Trust’s Board (the “Board”) of Directors or Trustees, as appropriate (the “Trustees”). In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, market transactions in comparable investments, various relationships observed in the market between investments, and calculated yield measures based on valuation technology commonly employed in the market for such investments. Effective September 4, 2007, exchange-traded options are valued at the mean between the last bid and ask prices at the close of the options market in which the options trade and previously were valued at the last sales price as of the close of options trading on applicable exchanges. Swap quotations are provided by dealers selected under supervision of the Board. A futures contract is valued at the last sale price as of the close of the commodities exchange on which it trades. Short-term securities may be valued at amortized cost.

Bank loans (“loan interests”) are valued in accordance with guidelines established by the Board. Loan interests are valued at the average between the last available bid prices from one or more brokers or dealers as obtained from Loan Pricing Corporation (“LPC”). If no reliable price quotes are available, LPC values such interests through the use of pricing matrixes. If the pricing service does not provide a value for the loan interests, BlackRock Advisors, LLC (the “Manager”), an indirect, wholly owned subsidiary of BlackRock, Inc., will value the loan interests at fair value under methods approved by the Funds’ Board.

Investments or other assets for which such current market quotations are not readily available are valued at fair value (“Fair Value Assets”) as determined in good faith under procedures established by, and under the general supervision and responsibility of, each Trust’s Board. The investment advisor and/or sub-advisor will submit its recommendations regarding the valuation and/or valuation methodologies for Fair Value Assets to a valuation committee. The valuation committee may accept, modify or reject any recommendations. The pricing of all Fair Value Assets shall be subsequently reported to the Board.

When determining the price for a Fair Value Asset, the investment advisor and/or sub-advisor shall seek to determine the price that the Trust might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Manager deems relevant.

In September 2006, Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“FAS 157”), was issued and is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. At this time, management is evaluating the implication of FAS 157 and its impact on the Trusts’ financial statements, if any, has not been determined.

In addition, in February 2007, Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“FAS 159”), was issued and is effective for fiscial years beginning after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FAS 157. FAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. FAS 159 also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. At this time, management is evaluating the implications of FAS 159 and its impact on the Trusts’ financial statements, if any, has not been determind.

Investment Transactions and Investment Income: Investment transactions are recorded on trade date. The cost of investments sold and the related gain or loss is determined by use of the specific identification method, generally first-in, first-out, for both financial reporting and federal income tax purposes. Each Trust records interest income on an accrual basis and amortizes premium and/or accretes discount on securities purchased using the interest method. Dividend income is recorded on the ex-dividend date.

63 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

Each trust may from time to time purchase in the secondary market certain mortgage pass-through securities packaged or master serviced by affiliates or mortgage-related securities containing loans or mortgages originated by Merrill Lynch & Co., Inc. (“Merrill Lynch”) and The PNC Financial Services Group, Inc. (“PNC”), both principal owners of BlackRock, Inc., or their affiliates, including Midland Loan Services, Inc. It is possible under certain circumstances, that Merrill Lynch Mortgage Investors, Inc. and PNC Mortgage Securities Corp. or their affiliates, including Midland Loan Services, Inc., could have interest that are conflict with the holders of these mortgage-backed securities, and such holders could have rights against Merrill Lynch Mortgage Investors, Inc. and PNC Mortgage Securitites Corp. or their affiliates, including Midland Loan Services, Inc.

Reverse Repurchase Agreements: The Trusts may enter into reverse repurchase agreements with qualified third-party broker-dealers as determined by and under the direction of the Trusts’ Board. Interest on the value of reverse repurchase agreements issued and outstanding is based upon competitive market rates at the time of issuance. At the time a Trust enters into a reverse repurchase agreement, it will establish and maintain a segregated account with the lender, containing liquid investment grade securities having a value not less than the repurchase price, including accrued interest of the reverse repurchase agreement.

Dollar Rolls: The Trusts may enter into dollar rolls in which a Trust sells securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon and maturity) securities on a specified future date. During the roll period the Trusts forgo principal and interest paid on the securities. The Trusts will be compensated by the interest earned on the cash proceeds of the initial sale and/or by the lower repurchase price at the future date.

Loan Payable: High Yield has a $32 million committed credit facility (the “facility”). Under the terms of the facility, the Trust borrows at the London Interbank Offered Rate (“LIBOR”) plus facility and administrative fees. In addition, the Trust pays a liquidity fee on the unused portion of the facility. The Trust may borrow up to 33¹/₃% of its total assets up to the committed amount. In accordance with the terms of the facility, the Trust has pledged its portfolio assets as collateral for the borrowing.

Bank Loans: In the process of buying, selling and holding bank loans, a Trust may receive and/or pay certain fees. These fees are included in the purchase price and may include facility fees, commitment fees, amendment fees, commissions and prepayment penalty fees. These fees are amortized as premium and/or accreted as discount over the term of the loan. When a Trust buys a bank loan it may receive a facility fee and when it sells a bank loan it may pay a facility fee. On an ongoing basis, a Trust may receive a commitment fee based on the undrawn portion of the underlying line of credit portion of a bank loan. In certain circumstances, a Trust may receive a prepayment penalty fee upon the prepayment of a bank loan by a borrower. Other fees recieved by a Trust may include covenant waiver fees and covenant modification fees.

A Trust may invest in multiple series or tranches of an issuer. A different series or tranche may have varying terms and carry different associated risks.

Option Writing/Purchasing: When a Trust writes or purchases an option, an amount equal to the premium received or paid by the Trust is recorded as a liability or an asset and is subsequently adjusted to the current market value of the option written or purchased. Premiums received or paid from writing or purchasing options which expire unexercised are treated by the Trust on the expiration date as realized gains or losses. The difference between the premium and the amount paid or received on effecting a closing purchase or sale transaction, including brokerage commissions, is also treated as a realized gain or loss. If an option is exercised, the premium paid or received is added to the cost of the purchase or the proceeds from the sale in determining whether a Trust has realized a gain or a loss on investment transactions. A Trust, as writer of an option, has no control over whether the underlying securities may be sold (call) or purchased (put) and as a result bears the market risk of an unfavorable change in the price of the security underlying the written option.

Option writing and purchasing may be used by the Trusts as an attempt to manage the duration of positions, or collections of positions, so that changes in interest rates do not adversely affect the targeted duration of the portfolio unexpectedly. Duration is a measure of the price sensitivity of a security or a portfolio to relative changes in interest rates. For instance, a duration of “one” means that a portfolio’s or a security’s price would be expected to change by approximately one percent with a one percent change in interest rates, while a duration of five would imply that the price would move approximately five percent in relation to a one percent change in interest rates.

A call option gives the purchaser of the option the right (but not obligation) to buy, and obligates the writer to sell (when the option is exercised), the underlying position at the exercise price at any time or at a specified time during the option period. A put option gives the holder the right to sell and obligates the writer to buy the underlying position at the exercise price at any time or at a specified time during the option period. The main risk that is associated with purchasing options is that the option expires without being exercised. In this case, the option expires worthless and the premium paid for the option is considered the loss. The risk associated with writing call options is that a Trust may forgo the opportunity for a profit if the market value of the underlying position increases and the option is exercised. The risk in writing put options is that a Trust may incur a loss if the market value of the underlying position decreases and the option is exercised. In addition, the Trust risks not being able to enter into a closing transaction for the written option as the result of an illiquid market.

Stripped Mortgage-Backed Securities: Stripped mortgage-backed securities are usually structured with two classes that receive different proportions of the interest and principal distributions on a pool of mortgage assets. In certain cases, one class will receive all of the interest (the interest-only or “IO” class), while the other class will receive all of the principal (the principal-only or “PO” class). The yield to maturity on IOs is sensitive to the rate of principal repayments (including prepayments) on the related underlying mortgage assets, and principal payments may have a material effect on yield to maturity. If the underlying mortgage assets experience greater than anticipated prepayments of principal, a Trust may not fully recoup its initial

ANNUAL REPORT OCTOBER 31, 2007 64

Notes to Financial Statements (continued)

investment in IOs. Such securities will be considered liquid only if so determined in accordance with guidelines established by the Trustees.

Inverse Floating Rate Securities: The Trusts may invest in inverse floating rate securities that pay interest at a rate that varies inversely with interest rates. As interest rates rise, inverse floating rates decline. The market value of such securities is more volatile than comparable fixed rate securities.

Credit Default Swaps: Credit default swaps are agreements in which one party pays fixed periodic payments to a counterparty in consideration for a guarantee from the counterparty to make a specific payment should a negative credit event take place. Risks arise from the possible inability of the counterparties to meet the terms of their contracts.

During the term of the swap, changes in the value of the swap are recognized as unrealized gains or losses by “marking-to-market” to reflect the market value of the swap. When the swap is terminated, a Trust will record a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust’s basis in the contract, if any.

The Trusts are exposed to credit loss in the event of non-performance by the other party to the swap. However, the Trusts closely monitor swaps and do not anticipate non-performance by any counterparty.

Total Return Swaps: Total return swaps are agreements in which one party commits to pay interest in exchange for a market-linked return. To the extent the total return of the security or index underlying the transaction exceeds or falls short of the offsetting interest rate obligation, the Trust will receive a payment from or make a payment to the counterparty.

During the term of the swap, changes in the value of the swap are recognized as unrealized gains or losses by “marking-to-market” to reflect the market value of the swap. When the swap is terminated, a Trust will record a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust’s basis in the contract, if any.

The Trusts are exposed to credit loss in the event of non-performance by the other party to the swap. However, the Trusts closely monitor swaps and do not anticipate non-performance by any counterparty.

Interest Rate Swaps: In an interest rate swap, one investor pays a floating rate of interest on a notional principal amount and receives a fixed rate of interest on the same notional principal amount for a specified period of time. Alternatively, an investor may pay a fixed rate and receive a floating rate. Interest rate swaps are efficient as asset/liability management tools. In more complex swaps, the notional principal amount may decline (or amortize) over time.

During the term of the swap, changes in the value of the swap are recognized as unrealized gains or losses by “marking-to-market” to reflect the market value of the swap. When the swap is terminated, a Trust will record a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust’s basis in the contract, if any.

The Trusts are exposed to credit loss in the event of non-performance by the other party to the swap. However, the Trusts closely monitor swaps and do not anticipate non-performance by any counterparty.

Swap Options: Swap options are similar to options on securities except that instead of selling or purchasing the right to buy or sell a security, the writer or purchaser of the swap option is granting or buying the right to enter into a previously agreed upon interest rate swap agreement at any time before the expiration of the option. Premiums received or paid from writing or purchasing options are recorded as liabilities or assets and are subsequently adjusted to the current market value of the option written or purchased. Premiums received or paid from writing or purchasing options which expire unexercised are treated by a Trust on the expiration date as realized gains or losses. The difference between the premium and the amount paid or received on effecting a closing purchase or sale transaction, including brokerage commission, is also treated as a realized gain or loss. If an option is exercised, the premium paid or received is added to the cost of the purchase or the proceeds from the sale in determining whether a Trust has realized a gain or loss on investment transactions.

The main risk that is associated with purchasing swap options is that the swap option expires without being exercised. In this case, the option expires worthless and the premium paid for the swap option is considered the loss. The main risk that is associated with the writing of a swap option is the market risk of an unfavorable change in the value of the interest rate swap underlying the written swap option.

Swap options may be used by the Trusts to manage the duration of the Trusts’ portfolios in a manner similar to more generic options described above.

Interest Rate Floors: Interest rate floors are similar to interest rate swaps, except that one party agrees to pay a fee, while the other party pays the deficiency, if any, of a floating rate under a specified fixed or floating rate.

Interest rate floors are used by the Trusts to both manage the duration of the portfolios and their exposure to changes in short-term interest rates. Selling interest rate floors reduces a portfolio’s duration, making it less sensitive to changes in interest rates from a market value perspective. The Trusts’ leverage provides extra income in a period of falling rates. Selling floors reduces some of that extra income by partially monetizing it as an up front payment which the Trusts receive.

The Trusts are exposed to credit loss in the event of non-performance by the other party to the interest rate floor. However, the Trusts do not anticipate non-performance by any counterparty.

Transaction fees paid or received by the Trusts are recognized as assets or liabilities and amortized or accreted into interest expense or income over the life of the interest rate floor. The asset or liability is subsequently adjusted to the current market value of the interest rate floor purchased or sold. Changes in the value of the interest rate floor are recognized as unrealized gains and losses.

Financial Futures Contracts: A futures contract is an agreement between two parties to buy and sell a financial instrument for a set price on a future date. Initial margin deposits are made upon entering into futures contracts and can be either cash or securities. During the period the futures contract is open, changes in the value of the contract are recognized as unrealized gains or losses by “marking-to-market” on a daily basis to reflect the market value of the contract at the end of each day’s trading. Variation margin pay-

65 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

ments are made or received, depending upon whether unrealized gains or losses are incurred. When the contract is closed, a Trust records a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust’s basis in the contract.

Financial futures contracts, when used by the Trusts, help in maintaining a targeted duration. Futures contracts can be sold to effectively shorten an otherwise longer duration portfolio. In the same sense, futures contracts can be purchased to lengthen a portfolio that is shorter than its duration target. Thus, by buying or selling futures contracts, the Trusts attempt to manage the duration of positions so that changes in interest rates do not change the duration of the portfolio unexpectedly.

Forward Currency Contracts: The Trusts enter into forward currency contracts primarily to facilitate settlement of purchases and sales of foreign securities and to help manage the overall exposure to foreign currency. A forward contract is a commitment to purchase or sell a foreign currency at a future date (usually the security transaction settlement date) at a negotiated forward rate. In the event that a security fails to settle within the normal settlement period, the forward currency contract is renegotiated at a new rate. The gain or loss arising from the difference between the settlement value of the original and renegotiated forward contracts is isolated and is included in net realized gains (losses) from foreign currency transactions. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their contract.

Forward currency contracts, when used by the Trusts, help to manage the overall exposure to the foreign currency backing some of the investments held by the Trusts. Forward currency contracts are not meant to be used to eliminate all of the exposure to the foreign currency, rather they allow the Trusts to limit their exposure to foreign currency within a narrow band to the objectives of the Trusts.

Foreign Currency Translation: Foreign currency amounts are translated into United States dollars on the following basis:

(i)        market value of investment securities, assets and liabilities at the current rate of exchange.

(ii)       purchases and sales of investment securities, income and expenses—at the rates of exchange prevailing on the respective dates of such transactions.

For fixed income securities, the Trusts isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the fluctuations arising from changes in the market prices of securities held at period end. Similarly, the Trusts isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of portfolio securities sold during the period.

Net realized and unrealized foreign exchange gains and losses includes realized foreign exchange gains and losses from sales and maturities of foreign portfolio securities, sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of interest and discount recorded on the Trusts’ books and the U.S. dollar equivalent amounts actually received or paid, and changes in unrealized foreign exchange gains and losses in the value of portfolio securities and other assets and liabilities arising as a result of changes in the exchange rate.

Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign currency relative to the U.S. dollar.

Short Sales/Borrowed Bonds: The Trusts engage in short selling of securities as a method of managing potential price declines in similar securities owned by the Trust. When a Trust engages in short selling, it may enter into a borrowed bond agreement to borrow the security sold short and deliver it to the broker-dealer with which it engaged in the short sale. A gain, limited to the price at which a Trust sold the security short or pursuant to the borrowed bond agreement, or a loss, unlimited as to dollar amount, will be recognized upon the termination of a short sale or borrowed bond agreement if the market price is greater or less than the proceeds originally received.

Borrowed Bond Agreements: In a borrowed bond agreement, each Trust borrows securities from a third party, with the commitment that they will be returned to the lender on an agreed-upon date. Borrowed bond agreements are primarily entered into to settle short positions. In a borrowed bond agreement, the Trust’s prime broker or third party broker takes possession of cash as collateral. The Trusts receive interest income on the cash collateral relating to the borrowed bond agreement and are obligated to pay the prime broker or third party broker payments received on such borrowed securities. The cash collateral approximates the principal amount of the bonds borrowed transaction. To the extent that the bonds borrowed transactions exceed one business day, the value of the collateral with any counter-party is marked-to-market on a daily basis to ensure the adequacy of the collateral. If the lender defaults and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the lender of the security, realization of the collateral by the Trust may be delayed or limited.

Trust Preferred Stock: These securities are typically issued by corporations, generally in the form of interest-bearing notes with preferred securities characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in subordinated debentures or similarly structured securities. The securities can be structured as either fixed or adjustable coupon securities that can have either a perpetual or stated maturity date. Dividends can be deferred without creating an event of default or acceleration, although maturity cannot take place unless all cumulative payment obligations have been met. The deferral of payments does not affect the purchase or sale of these securities in the open market. Payments on these securities are treated as interest rather than dividends for Federal income tax purposes. These securities can have a rating that is slightly below that of the issuing company’s senior debt securities.

TBA Purchase Commitments: The Trusts may enter into to be announced (“TBA”) commitments to purchase or sell securities for a fixed price at a future date. TBA commitments are considered securities in themselves, and involve a risk of loss if the value of the security to be purchased or sold

ANNUAL REPORT OCTOBER 31, 2007 66

Notes to Financial Statements (continued)

declines or increases prior to settlement date, which is in addition to the risk of decline in the value of the Trusts’ other assets. Unsettled TBA commitments are valued at the current market value of the underlying securities, according to the procedures described under “Investments Valuation”.

Mortgage Dollar Rolls: The Trusts may enter into mortgage dollar rolls (principally using TBA commitments) in which the Trusts sell mortgage securities for delivery in the current month and simultaneously contract to repurchase similar, but not identical, securities at an agreed upon price on a fixed date. The Trusts receive compensation, in either “fee” or “drop”, as consideration for entering into the commitment to repurchase. A Trust must maintain liquid securities having a value not less than the repurchase price (including accrued interest) for such dollar rolls. The market value of the securities that a Trust is required to purchase may decline below the agreed upon repurchase price of those securities. In a “fee” roll, the compensation received is recorded as deferred income and amortized to income over the roll period. In a “drop” roll, the compensation is paid via a lower price for the security upon its repurchase. The counterparty receives all principal and interest payments, including prepayments, made in respect of a security subject to such a contract while it is the holder. Mortgage dollar rolls may be renewed with a new purchase and repurchase price and a cash settlement made on settlement date without physical delivery of the securities subject to the contract. A Trust engages in dollar rolls for the purpose of enhancing its yield, principally by earning a negotiated fee.

Financing Transactions: The Trusts may enter into financing transactions consisting of sales by a Trust of securities together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Trust sells the security becomes insolvent, a Trust’s right to repurchase the security may be restricted. The value of the security may change over the term of the financing transaction.

Segregation: In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (the “Commission”) require that each Trust segregate assets in connection with certain investments (e.g., when issued securities, reverse repurchase agreements, swaps or futures contracts), each Trust will, consistent with certain interpretive letters issued by the SEC, designate on its books and records cash or other liquid debt securities having a market value at least equal to the amount that would otherwise be required to be physically segregated.

Federal Income Taxes: It is each Trust’s intention to continue to be treated as a regulated investment company under the Internal Revenue Code and to distribute sufficient amounts of their taxable income to shareholders. Therefore, no federal income tax provisions have been recorded.

In July 2006, the Financial Accounting Standards Board issued Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes — an interpretation of FAS Statement No. 109.” FIN 48 prescribes the minimum recognition threshold a tax position must meet in connection with accounting for uncertainties in income tax positions taken or expected to be taken by an entity, including mutual funds, before being measured and recognized in the financial statements. Adoption of FIN 48 is required for the last net asset value calculation in the first required financial statement reporting period for fiscal years beginning after December 15, 2006. The impact on the Trusts’, excluding Preferred and Equity, financial statements, if any, from FIN 48 is currently being assessed.

Effective October 31, 2007, Preferred and Equity implemented Financial Accounting Standards Board (“FASB”) Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109” (“FIN 48”). FIN 48 prescribes the minimum recognition threshold a tax position must meet in connection with accounting for uncertainties in income tax positions taken or expected to be taken by an entity, including investment companies, before being measured and recognized in the financial statements. Management has evaluated the application of FIN 48 to Preferred and Equity and has determined that the adoption of FIN 48 does not have a material impact on the financial statements. Preferred and Equity will file its first Federal and state tax returns in 2008 for the period ended October 31, 2007.

Dividends and Distributions: Each Trust declares and pays dividends and distributions to common shareholders monthly from net investment income, net realized short-term capital gains and other sources, if necessary. Net long-term capital gains, if any, in excess of loss carryforwards may be distributed in accordance with the 1940 Act. If the total dividends and distributions made in any tax year exceeds net investment income and accumulated realized captial gains, a portion of the total distribution may be treated as a tax-free return of capital. Dividends and distributions are recorded on the ex-dividend date. Income distributions and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Dividends and distributions to preferred shareholders are accrued and determined as described in Note 7.

Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities including investment valuations at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates and such differences may be material.

Deferred Compensation and BlackRock Closed-End Share Equivalent Investment Plan: Under the deferred compensation plan approved by each Trust’s Board, non-interested Trustees (“Independent Trustees”) defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of the other BlackRock Closed-End Funds selected by the Independent Trustees. These amounts are shown on the Statement of Assets and Liabilities as “Investments in Affiliates”. This has approximately the same economic effect for the Independent Trustees as if the Independent Trustees had invested the deferred amounts directly in such Trusts.

The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of the Trust.

67 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

Each Trust may, however, elect to invest in common shares of those Trusts selected by the Independent Trustees in order to match its deferred compensation obligations.

Other: Expenses that are directly related to one of the Trusts are charged directly to that Trust. Other operating expenses are generally prorated to the Trusts on the basis of relative net assets of all the BlackRock Closed-End Funds.

Note 2. Agreements and Other Transactions with Affiliates and Related Parties

Each Trust has an Investment Management Agreement with the Manager. BlackRock Financial Management, Inc. (“BFM”), a wholly owned subsidiary of BlackRock, Inc., serves as sub-advisor to Core Bond, Limited Duration, Preferred and Equity and Strategic Bond. BlackRock Investment Management, LLC (“BIM”), a wholly owned subsidiary of BlackRock, Inc., also serves as sub-advisor to Preferred and Equity. Merrill Lynch and PNC are principal owners of BlackRock, Inc.

Broad Investment Grade, High Yield, Income Opportunity and Income Trust each have an Administration Agreement with the Advisor. The Investment Management Agreement for Core Bond, Limited Duration, Preferred and Equity and Strategic Bond covers both investment advisory and administration services.

Each Trust’s investment advisory fee paid to the Advisor is computed weekly and payable monthly based on an annual rate, 0.55% for Broad Investment Grade, 0.60% for Income Opportunity and 0.65% for Income Trust, of each Trust’s average net assets and 0.55% for Core Bond and Limited Duration, 0.65% for Preferred and Equity, 1.05% for High Yield and 0.75% for Strategic Bond, of each Trust’s average managed assets. “Net assets” means the total assets of the Trust minus the sum of accrued liabilities. “Managed assets” means the total assets of a Trust (including any assets attributable to any borrowing that may be outstanding) minus the sum of accrued liabilities (other than debt representing financial leverage). The Advisor has voluntarily agreed to waive a portion of the investment advisory fees or other expenses on Strategic Bond as a percentage of its average weekly managed assets as follows: 0.20% for the first five years of the Trust’s operations from 2002 through February 28, 2007, 0.15% through February 28, 2008, 0.10% through February 28, 2009 and 0.05% through February 28, 2010.

The Advisor pays BFM fees for its sub-advisory services.

The administration fee paid to the Advisor is computed weekly and payable monthly based on an annual rate, 0.15% for Broad Investment Grade, 0.10% for Income Opportunity, and 0.15% for Income Trust, of each Trust’s average net assets and 0.10% for High Yield of the Trust’s average managed assets.

Pursuant to the advisory agreements, the Advisor provides continuous supervision of the investment portfolio and pays the compensation of officers of each Trust who are affiliated persons of the Advisor, as well as occupancy and certain clerical and accounting costs of each Trust. Each Trust bears all other costs and expenses, which include reimbursements to the Advisor for cost of employees that provide pricing and secondary market support to each Trust. These expenses are generally pro-rated to the Trusts on the basis of relative net assets of all the BlackRock Closed-End Funds. For the year ended October 31, 2007, the Trusts reimbursed the Advisor the following amounts, which are included in miscellaneous expenses in the Statements of Operations:

Trust		Amount
Broad Investment Grade	$	2,929
Core Bond		22,028
High Yield		2,530
Income Opportunity		22,733
Income Trust		26,282
Limited Duration		40,812
Preferred and Equity		25,990
Strategic Bond		5,617

Pursuant to the terms of their custody agreements, each Trust may receive earnings credits from its custodian for positive cash balances maintained, which are used to offset custody fees. These credits are shown on the Statements of Operations as “fees paid indirectly.”

During the year ended October 31, 2007, Merrill Lynch, through its affiliated broker dealer Merrill Lynch, Pierce, Fenner & Smith, Inc., earned commissions on transactions of securities as follows:

Trust		Commission Amount
Core Bond	$	104,454
High Yield		8
Income Opportunity		110,446
Income Trust		66,166
Limited Duration		1,603
Preferred and Equity		757,239
Strategic Bond		28

ANNUAL REPORT OCTOBER 31, 2007 68

Notes to Financial Statements (continued)

Investments in companies considered to be an affiliate of the Trusts, for purposes of Section 2(a)(3) of the 1940 Act, were as follows:

Trust	Portfolio Company	Beginning Principal Amount		Purchases		Sales		Ending Principal Amount		Interest Income		Market Value of Affiliates at October 31, 2007
Core Bond	Merrill Lynch	$	1,509,548	$	—	$	1,509,548	$	—	$	45,271	$	—
	Mortgage
	Investors, Inc.,
	Ser. HE2,
	Class A2A
	Merrill Lynch		—		925,000		—		925,000		7,589		933,463
	Mortgage Trust,
	Ser. C1,
	Class AM
Income	Merrill Lynch		1,651,471		—		1,651,471		—		49,245		—
Opportunity	Mortgage
	Investors, Inc.,
	Ser. HE2,
	Class A2A
	Merrill Projects,		152,326		—		102,166		50,160		10,465		50,662
	Ser. 29
	Merrill Projects,		51,398		—		2,145		49,253		3,746		49,745
	Ser. 42
Income	Merrill Projects,		51,249		—		1,726		49,523		3,731		50,019
Trust	Ser. 54

Certain officers and/or directors of the Trusts are officers and/or directors of BlackRock, Inc. or its affiliates.

Note 3. Portfolio Securities

Purchases and sales of investment securities, other than short-term investments, dollar rolls and U.S. government securities, for the year ended October 31, 2007 were as follows:

Trust		Purchases		Sales
Broad Investment Grade	$	3,771,896	$	4,504,593
Core Bond		722,652,874		440,021,114
High Yield		45,730,396		53,761,581
Income Opportunity		1,000,463,875		694,999,046
Income Trust		1,181,095,299		1,209,086,090
Limited Duration		654,114,184		991,030,609
Preferred and Equity		2,424,297,184		773,130,150
Strategic Bond		34,511,252		56,088,950

Purchases and sales of U.S. government securities for the year ended October 31, 2007, aggregated as follows:

Trust		Purchases		Sales
Broad Investment Grade	$	—	$	5,655,469
Core Bond		188,022,696		260,028,377
Income Opportunity		213,262,623		298,489,442
Income Trust		132,824,013		163,361,268
Limited Duration		—		10,000,000
Preferred and Equity		479,869,532		487,606,224
Strategic Bond		172,822		933,000

69 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

Details of open forward currency contracts at October 31, 2007 were as follows:

Trust	Foreign Currency	Settlement Date	Contract to Receive			Value at Settlement Date			Value at Unrealized October 31, 2007			Appreciation (Depreciation)
Core	Bought:
Bond	Japanese
	Yen	1/15/08		$	793,358,661		$	6,876,169		$	6,937,915		$	61,746
	Sold:
	Euro	1/23/08			1,233,067			1,747,256			1,787,871			(40,615	)
													$	21,131
Limited	Sold:
Duration	Euro	1/23/08		$	20,975,550		$	29,722,354		$	30,413,254		$	(690,900	)
	British
	Pounds	1/23/08			5,195,000			10,540,239			10,771,890			(231,651	)
													$	(922,551	)

Income Trust held interest rate floors at October 31, 2007. Under the agreement, Income Trust pays the excess, if any, of a fixed rate over a floating rate. Income Trust received a transaction fee for the floor. Transaction fees are amortized through the termination of the agreement. Details of the interest rate floor held at October 31, 2007 were as follows:

Notional Amount (000)		Variable Rate		Counter Party	Floating Rate	Effective Date	Termination Date	Amortized Cost			Value at October 31, 2007				Unrealized Appreciation (Depreciation)
$	145,000	4.80	%	Goldman Sachs	3-month LIBOR	12/25/05	03/25/11	$	(1,603,115	)		$	(953,577	)		$	649,538
	96,000	4.95		JPMorgan	3-month LIBOR	03/27/06	03/25/11		(1,243,216	)			(443,318	)			799,898
	70,000	5.50		Union Bank of Switzerland	3-month LIBOR	12/15/06	03/15/10		(916,771	)			(1,244,600	)			(327,829	)
	39,000	5.50		Citibank	3-month LIBOR	06/15/07	09/15/11		(716,795	)			(1,042,470	)			(325,675	)
								$	(4,479,897	)		$	(3,683,965	)		$	795,932

Details of open interest rate swaps at October 31, 2007 were as follows:

Trust

Notional Amount (000)

Fixed Rate

Counter Party

Floating Rate

Effective Date

Termination Date

Unrealized Appreciation (Depreciation)

Core Bond

$

41,200

4.510

%(a)

Citibank

3-month LIBOR

10/29/04

10/29/14

$

1,063,372

2,800

4.500

(a)

JPMorgan

3-month LIBOR

05/26/05

05/26/15

62,565

4,800

4.372

(b)

Union Bank of Switzerland

3-month LIBOR

06/30/05

06/30/15

(139,248

)

6,200

4.725

(b)

Morgan Stanley

3-month LIBOR

08/02/05

08/02/15

(121,184

)

4,600

5.000

(b)

Deutsche Bank

3-month LIBOR

11/07/05

11/07/10

98,394

5,000

4.870

(b)

Goldman Sachs

3-month LIBOR

01/25/06

01/25/16

5,336

4,800

5.723

(b)

JPMorgan

3-month LIBOR

07/14/06

07/14/16

296,976

25,100

5.496

(b)

Bank of America

3-month LIBOR

07/28/06

07/28/11

1,016,550

3,000

5.025

(b)

Deutsche Bank

3-month LIBOR

11/21/06

11/21/11

66,000

2,200

4.950

(b)

Union Bank of Switzerland

3-month LIBOR

11/29/06

11/29/11

41,734

8,300

5.002

(a)

Union Bank of Switzerland

3-month LIBOR

01/08/07

01/08/12

(178,865

)

8,545

5.411

(b)

JPMorgan

3-month LIBOR

02/05/07

08/15/22

147,914

11,300

5.295

(b)

Union Bank of Switzerland

3-month LIBOR

02/08/07

02/08/17

187,806

13,500

4.922

(a)

Lehman Brothers

3-month LIBOR

03/22/07

03/22/11

(98,145

)

700

5.250

(b)

Goldman Sachs

3-month LIBOR

04/12/07

04/12/17

8,291

1,400

5.411

(b)

Goldman Sachs

3-month LIBOR

04/30/07

04/30/27

18,746

1,600

5.545

(a)

Deutsche Bank

3-month LIBOR

06/07/07

06/07/17

(77,360

)

1,200

5.740

(a)

Deutsche Bank

3-month LIBOR

06/13/07

06/13/17

(76,656

)

900

5.850

(a)

Deutsche Bank

3-month LIBOR

06/14/07

06/14/17

(65,367

)

4,600

5.683

(a)

Lehman Brothers

3-month LIBOR

06/29/07

06/29/17

(278,070

)

6,500

5.643

(a)

Citibank

3-month LIBOR

07/05/07

07/05/17

(369,720

)

12,300

5.775

(a)

Deutsche Bank

3-month LIBOR

07/09/07

07/09/17

(828,528

)

42,000

5.589

(a)

Goldman Sachs

3-month LIBOR

07/16/07

07/16/12

(1,940,683

)

19,500

5.105

(b)

Goldman Sachs

3-month LIBOR

08/20/07

08/20/12

226,522

82,500

5.076

(b)

Citibank

3-month LIBOR

08/21/07

08/21/12

884,400

49,300

5.057

(b)

Bank of America

3-month LIBOR

08/22/07

08/22/12

485,112

27,800

4.771

(b)

Lehman Brothers

3-month LIBOR

08/23/07

08/23/09

42,812

40,200

4.880

(b)

Lehman Brothers

3-month LIBOR

08/24/07

08/24/09

143,514

40,000

5.076

(b)

Morgan Stanley

3-month LIBOR

08/28/07

08/28/12

416,828

30,000

4.903

(b)

Barclays

3-month LIBOR

09/07/07

09/07/12

54,879

ANNUAL REPORT OCTOBER 31, 2007 70

Notes to Financial Statements (continued)

Trust	Notional Amount (000)		Fixed Rate		Counter Party	Floating Rate	Effective Date	Termination Date	Unrealized Appreciation (Depreciation)
Core Bond	$	12,500	5.040	%(a)	Deutsche Bank	3-month LIBOR	09/12/07	09/12/17		$	67,500
(cont’d)		50,000	4.624	(b)	Credit Suisse International	3-month LIBOR	09/20/07	09/20/09			(52,500	)
		8,000	5.365	%(a)	Bank of America	3-month LIBOR	09/21/07	09/21/27			(55,120	)
		10,900	5.155	(a)	Citibank	3-month LIBOR	09/21/07	09/21/17			(51,666	)
		5,100	5.261	(a)	Morgan Stanley	3-month LIBOR	09/28/07	09/28/17			(61,132	)
		13,800	5.308	(a)	Barclays	3-month LIBOR	10/15/07	10/15/17			(226,458	)
		5,400	5.307	(a)	Deutsche Bank	3-month LIBOR	10/18/07	10/18/17			(88,884	)
		9,400	4.856	(b)	Deutsche Bank	3-month LIBOR	10/19/07	10/19/12			14,194
		9,500	5.005	(b)	JPMorgan	3-month LIBOR	10/22/07	10/22/14			16,569
										$	656,428
Income		27,500	4.399	%(a)	Deutsche Bank	3-month LIBOR	10/25/04	10/25/14			896,225
Opportunity		13,800	4.510	(a)	Citibank	3-month LIBOR	10/29/04	10/29/14			356,178
Trust		3,000	4.500	(a)	JPMorgan	3-month LIBOR	05/26/05	05/26/15			67,034
		5,200	4.372	(b)	Union Bank of Switzerland	3-month LIBOR	06/30/05	06/30/15			(150,852	)
		8,000	4.670	(b)	Goldman Sachs	3-month LIBOR	09/20/05	09/20/15			(191,440	)
		5,000	5.000	(b)	Deutsche Bank	3-month LIBOR	11/07/05	11/07/10			106,950
		5,200	5.723	(b)	JPMorgan	3-month LIBOR	07/14/06	07/14/16			321,724
		27,900	5.496	(b)	Bank of America	3-month LIBOR	07/28/06	07/28/11			1,129,608
		3,200	5.025	(b)	Deutsche Bank	3-month LIBOR	11/21/06	11/21/11			70,400
		3,100	4.950	(b)	Union Bank of Switzerland	3-month LIBOR	11/29/06	11/29/11			58,807
		10,000	4.897	(b)	JPMorgan	3-month LIBOR	12/12/06	12/12/11			163,300
		12,000	5.002	(a)	Union Bank of Switzerland	3-month LIBOR	01/08/07	01/08/12			(258,600	)
		12,000	5.295	(b)	Union Bank of Switzerland	3-month LIBOR	02/08/07	02/08/17			199,440
		14,800	4.922	(a)	Lehman Brothers	3-month LIBOR	03/22/07	03/22/11			(107,596	)
		5,000	5.071	(a)	Union Bank of Switzerland	3-month LIBOR	03/26/07	03/26/17			950
		800	5.250	(b)	Goldman Sachs	3-month LIBOR	04/12/07	04/12/17			9,475
		1,550	5.411	(b)	Goldman Sachs	3-month LIBOR	04/30/07	04/30/27			20,755
		1,800	5.545	(a)	Deutsche Bank	3-month LIBOR	06/07/07	06/07/17			(87,030	)
		1,400	5.740	(a)	Deutsche Bank	3-month LIBOR	06/13/07	06/13/17			(89,432	)
		1,000	5.850	(a)	Deutsche Bank	3-month LIBOR	06/14/07	06/14/17			(72,630	)
		5,100	5.683	(a)	Lehman Brothers	3-month LIBOR	06/29/07	06/29/17			(308,295	)
		7,200	5.643	(a)	Citibank	3-month LIBOR	07/05/07	07/05/17			(409,536	)
		13,600	5.775	(a)	Deutsche Bank	3-month LIBOR	07/09/07	07/09/17			(916,096	)
		46,800	5.589	(a)	Goldman Sachs	3-month LIBOR	07/16/07	07/16/12			(2,184,663	)
		9,405	5.411	(b)	JPMorgan	3-month LIBOR	08/15/07	08/15/22			162,801
		21,600	5.105	(b)	Goldman Sachs	3-month LIBOR	08/20/07	08/20/12			250,916
		91,000	5.076	(b)	Citibank	3-month LIBOR	08/21/07	08/21/12			975,520
		54,600	5.057	(b)	Bank of America	3-month LIBOR	08/22/07	08/22/12			537,264
		30,700	4.771	(b)	Lehman Brothers	3-month LIBOR	08/23/07	08/23/09			47,278
		44,500	4.880	(b)	Lehman Brothers	3-month LIBOR	08/24/07	08/24/09			158,865
		45,000	5.076	(b)	Morgan Stanley	3-month LIBOR	08/28/07	08/28/12			468,932
		35,000	4.903	(b)	Barclays	3-month LIBOR	09/07/07	09/07/12			64,026
		12,500	5.040	(a)	Deutsche Bank	3-month LIBOR	09/12/07	09/12/17			67,500
		50,000	4.624	(b)	Credit Suisse International	3-month LIBOR	09/20/07	09/20/09			(52,500	)
		8,900	5.365	(a)	Bank of America	3-month LIBOR	09/21/07	09/21/27			(61,321	)
		12,000	5.155	(a)	Citibank	3-month LIBOR	09/21/07	09/21/17			(56,880	)
		5,700	5.261	(a)	Morgan Stanley	3-month LIBOR	09/28/07	09/28/17			(68,324	)
		15,300	5.308	(a)	Barclays	3-month LIBOR	10/15/07	10/15/17			(251,073	)
		6,000	5.307	(a)	Deutsche Bank	3-month LIBOR	10/18/07	10/18/17			(98,760	)
		10,300	4.856	(b)	Deutsche Bank	3-month LIBOR	10/19/07	10/19/12			15,553
		10,500	5.005	(b)	JPMorgan	3-month LIBOR	10/22/07	10/22/14			18,313
										$	802,786
Income Trust		19,000	4.889	%(a)	Goldman Sachs	3-month LIBOR	04/22/04	04/22/14			51,374
		12,500	4.399	% (a)	Deutsche Bank	3-month LIBOR	10/25/04	10/25/14			407,375
		25,000	4.883	(b)	Union Bank of Switzerland	3-month LIBOR	03/21/05	03/21/15			(151,000	)
		16,000	4.925	(a)	Deutsche Bank	3-month LIBOR	03/22/05	03/22/15			53,760
		3,000	4.500	(a)	JPMorgan	3-month LIBOR	05/26/05	05/26/15			67,034
		4,500	4.442	(b)	Morgan Stanley	3-month LIBOR	07/11/05	07/11/15			(114,160	)
		12,000	4.320	(b)	Union Bank of Switzerland	3-month LIBOR	09/08/05	09/08/10			(132,240	)
		2,800	5.940	(b)	Union Bank of Switzerland	3-month LIBOR	12/07/05	12/07/15			213,220
		5,500	4.870	(b)	Goldman Sachs	3-month LIBOR	01/25/06	01/25/16			5,869
		5,400	5.723	(b)	JPMorgan	3-month LIBOR	07/14/06	07/14/16			334,098
		3,000	5.025	(b)	Deutsche Bank	3-month LIBOR	11/21/06	11/21/11			66,000

71 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements

Trust

Notional Amount (000)

Fixed Rate

Counter Party

Floating Rate

Effective Date

Termination Date

Unrealized Appreciation (Depreciation)

Income Trust

$

4,400

4.950

%(b)

Union Bank of Switzerland

3-month LIBOR

11/29/06

11/29/11

$

83,468

(cont’d)

11,900

5.295

(b)

Union Bank of Switzerland

3-month LIBOR

02/08/07

02/08/17

197,778

800

5.250

(b)

Goldman Sachs

3-month LIBOR

04/12/07

04/12/17

9,475

64,000

5.393

(b)

Credit Suisse International

3-month LIBOR

06/05/07

06/05/12

2,403,840

1,800

5.545

(a)

Deutsche Bank

3-month LIBOR

06/07/07

06/07/17

(87,030

)

1,400

5.740

(a)

Deutsche Bank

3-month LIBOR

06/13/07

06/13/17

(89,432

)

1,000

5.850

(a)

Deutsche Bank

3-month LIBOR

06/14/07

06/14/17

(72,630

)

5,200

5.683

(a)

Lehman Brothers

3-month LIBOR

06/29/07

06/29/17

(314,340

)

200,000

5.383

(b)

Credit Suisse International

3-month LIBOR

07/16/07

07/16/09

5,234,000

187,370

5.376

(b)

Bank of America

3-month LIBOR

07/20/07

07/20/09

4,950,315

165,647

5.505

(b)

Bank of America

3-month LIBOR

08/03/07

08/03/17

5,401,736

9,565

5.411

(b)

JPMorgan

3-month LIBOR

02/05/07

08/15/22

165,570

18,800

4.778

(b)

Citibank

3-month LIBOR

08/23/07

08/23/09

31,396

$

18,715,476

(a)	Trust pays fixed interest rate and receives floating rate.
(b)	Trust pays floating interest rate and receives fixed rate.

Details of open credit default swaps at October 31, 2007 were as follows:

Trust	Notional (000)				Fixed Rate		Counter Party	Effective Date	Termination Date	Unrealized (Depreciation)
Core Bond		$	340	(a)	0.950	%	Deutsche Bank	08/02/07	09/20/12		$	(462	)
Income Opportunity Trust			375	(a)	0.950		Deutsche Bank	08/02/07	09/20/12		$	(98	)
Limited Duration			4,500	(b)	1.200		Morgan Stanley	05/23/07	06/20/12		$	(156,669	)
			4,500	(b)	1.200		JP Morgan	05/23/07	06/20/12			(156,669	)
											$	(313,338	)

(a)	The terms were to receive the quarterly notional amount multiplied by the fixed rate and pay the counterparty, upon default of Lehman Brothers Holdings, Inc., the par value of the notional amount of Lehman Brothers Holdings, Inc.
(b)	The terms were to receive the quarterly notional amount multiplied by the fixed rate and pay the counterparty, upon default of LCDX, the par value of the notional amount of LCDX.

Transaction in options written during the year ended October 31, 2007 were as follows:

	Calls						Puts
Trust	Contracts/ Notional Amount			Premium Received			Contracts/ Notional Amount			Premium Received
Core Bond
Options outstanding
at October 31, 2006	$	21,300,000		$	991,347		$	135,100,037		$	2,068,284
Options written		18,200,000			455,276			18,200,000			455,276
Options closed		(11,600,000	)		(315,851	)		(125,400,037	)		(1,392,787	)
Options outstanding
at October 31, 2007	$	27,900,000		$	1,130,772		$	27,900,000		$	1,130,773
Income Opportunity Trust
Options outstanding
at October 31, 2006	$	23,400,000		$	1,085,069		$	148,200,041		$	2,236,554
Options written		19,700,000			491,847			19,700,000			491,847
Options closed		(12,400,000	)		(337,634	)		(137,200,041	)		(1,489,123	)
Options outstanding
at October 31, 2007	$	30,700,000		$	1,239,282		$	30,700,000		$	1,239,278
Income Trust
Options outstanding
at October 31, 2006	$	23,500,000		$	1,088,815		$	150,100,000		$	2,223,745
Options written		160,860,047			4,960,873			160,860,000			4,875,117
Options closed		(46,835,007	)		(1,047,343	)		—			—
Options expired		(16	)		(27,150	)		(173,435,000	)		(2,169,641	)
Options outstanding
at October 31, 2007	$	137,525,024		$	4,975,195		$	137,525,000		$	4,929,221

	Calls
Trust	Contracts/ Notional Amount			Premium Received
Preferred and Equity
Options outstanding
at beginning of period	$	—		$	—
Options written		3,335,500			57,773,808
Options closed		(3,079,500	)		(52,286,976	)
Options expired		(10,500	)		(60,705	)
Options outstanding
at October 31, 2007	$	245,500		$	5,426,127

ANNUAL REPORT OCTOBER 31, 2007 72

Notes to Financial Statements

Note 4. Borrowings

Details of open reverse repurchase agreements at October 31, 2007 were as follows (please see Corresponding Underlying Collateral Chart):

Trust/Counter Party	Rate		Trade Date	Maturity Date1	Net Closing Amount		Par
Core Bond
Barclay’s Bank	5.250	%	09/06/07	TBD	$	6,920,063	$	6,865,000
	5.270		09/06/07	TBD		3,189,475		3,164,000
	5.270		09/06/07	TBD		2,980,808		2,957,000
	5.290		09/06/07	TBD		3,003,076		2,979,000
	5.290		09/06/07	TBD		2,589,763		2,569,000
	5.290		09/24/07	TBD		1,707,280		1,698,048
							$	20,232,048
Credit Suisse First
Boston LLC	5.100		09/17/07	TBD		2,014,479	$	2,002,000
	5.100		09/17/07	TBD		1,771,977		1,761,000
	4.900		10/11/07	11/13/07		60,535,343		60,371,000
	5.100		10/11/07	TBD		2,016,020		2,010,325
							$	66,144,325
Lehman Brothers	4.200		10/02/07	TBD		9,963,295	$	9,929,700
	4.600		10/23/07	TBD		3,000,939		2,997,875
	4.600		10/26/07	TBD		2,423,047		2,421,500
	4.150		10/31/07	11/07/07		1,051,794		1,051,794
							$	16,400,869
Morgan Stanley	0.000		10/19/07	TBD		576,450	$	576,450
Income Opportunity
Barclay’s Bank	5.120		08/06/07	TBD		7,317,925	$	7,229,500
	5.120		08/06/07	TBD		1,973,243		1,949,400
	5.120		08/07/07	TBD		643,038		635,357
	5.140		08/13/07	TBD		1,407,495		1,391,796
	5.140		08/15/07	TBD		2,362,693		2,337,000
	5.120		08/17/07	TBD		1,335,584		1,321,488
	5.140		08/17/07	TBD		2,054,810		2,033,040
	5.140		08/17/07	TBD		2,528,732		2,501,940
	5.140		08/17/07	TBD		1,628,615		1,611,360
	5.120		08/21/07	TBD		1,082,805		1,071,980
	5.140		08/22/07	TBD		2,766,799		2,739,420
	5.140		08/22/07	TBD		1,716,619		1,699,632
	5.140		09/13/07	TBD		1,171,977		1,164,000
	5.160		09/13/07	TBD		1,681,490		1,670,000
	5.160		09/13/07	TBD		1,490,686		1,480,500
	5.140		09/13/07	TBD		1,800,757		1,788,500
	5.140		09/13/07	TBD		845,757		840,000
	5.160		09/13/07	TBD		1,929,182		1,916,000
	5.290		09/14/07	TBD		2,083,390		2,069,100
							$	37,450,013
Credit Suisse
First Boston LLC	5.100		08/20/07	TBD		2,207,211	$	2,184,925
	5.100		08/20/07	TBD		1,977,972		1,958,000
	5.100		08/20/07	TBD		2,099,423		2,078,225
	5.100		08/20/07	TBD		1,914,329		1,895,000
	5.100		08/20/07	TBD		614,394		608,190
	5.100		08/30/07	TBD		1,593,878		1,580,000
	5.100		08/30/07	TBD		1,187,338		1,177,000
	5.100		08/30/07	TBD		1,174,224		1,164,000
	5.600		08/31/07	11/01/07		1,933,171		1,915,000
	5.100		08/31/07	TBD		1,603,740		1,590,000
	4.900		10/10/07	11/13/07		26,408,268		26,333,000
	4.900		10/11/07	11/13/07		4,518,266		4,506,000
	5.100		10/18/07	TBD		4,278,469		4,270,000
							$	51,259,340

Trust/Counter Party	Rate		Trade Date	Maturity Date1	Net Closing Amount		Par
Income Opportunity (cont’d)
Lehman Brothers	4.200	%	10/01/07	TBD	$	8,485,395	$	8,455,800
	4.900		10/11/07	11/01/07		1,973,232		1,967,875
	4.800		10/25/07	11/13/07		4,322,455		4,319,000
	4.150		10/31/07	11/07/07		1,165,916		1,165,781
							$	15,908,456
Morgan Stanley	0.000		10/19/07	TBD		643,703	$	643,703
Income Trust
Lehman Brothers	4.600		11/01/07	TBD		24,280,081	$	24,280,113
	4.800		11/01/07	11/02/07		3,035,595		3,036,000
	4.800		11/01/07	11/02/07		1,073,107		1,073,250
	4.900		11/01/07	11/02/07		5,505,251		5,506,000
							$	33,895,363
Limited Duration
Barclay’s Bank	5.220		04/24/07	TBD		967,952	$	942,000
	5.220		05/01/07	TBD		4,508,542		4,392,000
	5.200		05/01/07	TBD		4,834,245		4,709,751
	5.170		05/01/07	TBD		5,005,043		4,876,875
	5.220		05/01/07	TBD		4,890,798		4,764,375
	5.220		05/01/07	TBD		4,775,313		4,651,875
	5.220		05/01/07	TBD		3,093,874		3,013,900
	5.220		05/01/07	TBD		571,375		556,605
	5.200		05/17/07	TBD		3,091,825		3,019,000
	5.220		07/09/07	TBD		771,546		759,000
							$	31,685,381
Credit Suisse
First Boston LLC	5.375		11/26/13	TBD		1,809,853	$	1,722,000
	5.100		12/05/06	TBD		5,565,373		5,316,812
	5.100		12/05/06	TBD		7,491,361		7,156,781
	5.100		12/07/06	TBD		2,997,342		2,864,250
	5.100		12/07/06	TBD		4,817,122		4,603,225
	5.100		01/18/07	TBD		2,295,602		2,206,213
	5.300		01/18/07	TBD		2,491,177		2,390,523
	5.300		04/17/07	TBD		1,604,750		1,559,520
	0.000		10/04/07	TBD		2,784,000		2,784,000
	5.300		05/16/07	TBD		1,796,358		1,753,000
	5.300		06/11/07	TBD		3,966,218		3,885,000
	5.300		06/11/07	TBD		5,165,782		5,060,000
	5.300		06/29/07	TBD		2,878,082		2,826,483
	5.300		07/09/07	TBD		1,511,957		1,487,000
							$	45,614,807
Lehman Brothers	5.100		7/26/06	TBD		1,474,583	$	1,384,000
	4.750		09/06/06	TBD		937,210		888,000
	5.000		11/27/06	TBD		349,679		334,000
	4.550		01/09/07	TBD		3,472,764		3,347,938
	4.510		01/12/07	TBD		17,203,359		16,596,250
	4.470		02/12/07	TBD		1,841,028		1,783,238
	4.520		02/28/07	TBD		709,164		688,000
	4.520		03/01/07	TBD		5,395,680		5,235,293
	1.250		09/07/07	TBD		1,733,244		1,730,000
							$	31,986,719
Preferred and Equity Advantage
Credit Suisse
First Boston LLC	0.000		10/04/07	TBD		4,988,000	$	4,988,000
	4.000		10/22/07	TBD		5,290,535		5,285,250
							$	10,273,250
Lehman Brothers	5.000		10/23/07	TBD		27,566,470	$	27,535,875
	5.000		10/23/07	TBD		25,046,799		25,019,000
	5.000		10/23/07	TBD		25,490,792		25,462,500
							$	78,017,375
Strategic Bond
Morgan Stanley	0.000		10/19/07	TBD		413,123	$	413,123

¹ TBD — To be determined

73 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

Details of underlying collateral for open reverse repurchase agreements at October 31, 2007 were as follows:

Trust/Counter Party	Description	Rate		Maturity Date	Original Face		Current Face		Market Value
Core Bond
Barclay’s Bank	General Electric Capital Corp.	6.150	%	8/7/2037	$	6,855,000	$	6,855,000	$	7,103,041
	Deutsche Telekom Intl. Finance BV	5.750		3/23/2016		3,000,000		3,000,000		3,007,887
	Verizon Virginia, Inc.	4.625		3/15/2013		3,150,000		3,150,000		3,024,873
	AT&T, Inc.	6.500		9/1/2037		2,600,000		2,600,000		2,742,532
	Intl. Business Machines Corp.	5.700		9/14/2017		1,760,000		1,760,000		1,786,375
	Morgan Stanley	5.493		1/19/2012		3,300,000		3,300,000		3,246,860
									$	20,911,568
Credit Suisse	Eli Lilly & Co.	5.550		3/15/2037		2,275,000		2,275,000	$	2,172,347
	U.S. Bank	6.500		2/1/2008		1,800,000		1,800,000		1,803,074
	Federal Home Loan Mortgage Corp.	5.500		11/1/2018		2,832,896		1,169,936		1,175,041
	Federal National Mortgage Assoc.	5.000		1/1/2018		3,536,110		1,041,164		1,029,288
	Federal National Mortgage Assoc.	5.000		7/1/2036		6,784,029		6,254,571		6,004,420
	Federal National Mortgage Assoc.	6.000		2/1/2036		1,116,625		894,711		901,470
	Federal National Mortgage Assoc.	6.000		4/1/2036		1,091,509		908,081		914,940
	Federal National Mortgage Assoc.	5.500		4/1/2036		1,018,042		895,122		882,170
	Federal National Mortgage Assoc.	6.000		2/1/2036		1,134,707		891,461		898,195
	Federal National Mortgage Assoc.	6.000		9/1/2036		1,039,072		863,698		870,222
	Federal National Mortgage Assoc.	5.500		12/1/2035		44,000,000		42,351,254		41,778,926
	Federal National Mortgage Assoc.	6.000		10/1/2036		3,304,703		3,100,363		3,123,783
	Federal National Mortgage Assoc.	5.000		3/1/2037		1,009,339		997,326		957,244
	Federal National Mortgage Assoc.	5.000		5/1/2037		4,257,973		4,204,831		4,035,841
	Royal Bank of Scotland Group PLC	7.640		N/A1		2,000,000		2,000,000		2,073,024
									$	68,619,985
Lehman	U.S. Treasury Inflation Indexed Bonds	2.375		1/15/2027		5,220,000		5,220,000	$	5,523,085
	U.S. Treasury Notes	4.750		8/15/2017		10,750,000		10,750,000		10,986,833
									$	16,509,918
Morgan Stanley	Michaels Stores, Inc.	11.375		11/1/2016		600,000		600,000	$	598,500
Income Opportunity
Barclay’s Bank	General Electric Capital Corp.	6.150		8/7/2037		7,610,000		7,610,000	$	7,885,360
	General Electric Capital Corp.	6.750		3/15/2032		1,900,000		1,900,000		2,120,377
	Berkshire Hathaway Finance Corp.	3.375		10/15/2008		2,025,000		2,025,000		1,997,982
	Morgan Stanley	5.493		1/9/2012		3,620,000		3,620,000		3,561,707
	Citigroup, Inc.	4.125		2/22/2010		2,425,000		2,425,000		2,384,488
	Bank of America Corp.	7.800		2/15/2010		2,450,000		2,450,000		2,597,750
	Eli Lilly & Co.	5.550		3/15/2037		1,800,000		1,800,000		1,718,780
	Johnson & Johnson	5.950		8/15/2037		1,120,000		1,120,000		1,171,362
	Bank of America Corp.	6.000		9/1/2017		2,850,000		2,850,000		2,905,373
	Bank of America NA	6.100		6/15/17		1,740,000		1,740,000		1,780,847
	Morgan Stanley	6.250		8/28/2017		1,200,000		1,200,000		1,228,642
	Kraft Foods, Inc.	7.000		8/11/2037		1,670,000		1,670,000		1,813,260
	Societe Generale	5.922		N/A1		1,575,000		1,575,000		1,498,912
	AstraZeneca Plc	6.450		9/15/2037		1,825,000		1,825,000		1,923,044
	Citigroup, Inc.	6.125		8/25/2036		900,000		900,000		877,919
	AT&T, Inc.	6.500		9/1/2037		1,980,000		1,980,000		2,088,544
	Intl. Business Machines Corp.	5.700		9/14/2017		2,200,000		2,200,000		2,232,968
									$	39,787,315
Credit Suisse	UBS Preferred Funding Trust I	8.622		N/A1		2,000,000		2,000,000	$	2,170,314
	Morgan Stanley	6.250		8/9/2026		2,100,000		2,100,000		2,069,773
	Wells Fargo Bank NA	7.550		6/21/10		2,000,000		2,000,000		2,124,152
	Allstate Corp.	6.500		5/15/2057		2,150,000		2,150,000		2,084,728
	General Electric Capital Corp.	6.750		3/15/2032		570,000		570,000		636,113
	Vodafone Group Plc	5.288		12/28/2007		1,615,000		1,615,000		1,615,326
	United Technologies Corp.	4.875		5/1/2015		1,250,000		1,250,000		1,209,314
	Amgen, Inc.	5.585		11/28/2008		1,200,000		1,200,000		1,197,836
	ConocoPhillips Australia Funding Co.	5.343		4/9/2009		1,970,000		1,970,000		1,964,845
	Wyeth	5.950		4/1/2037		1,690,000		1,690,000		1,671,373
	Federal National Mortgage Assoc.	5.500		1/1/2033		16,270,578		6,219,377		6,147,618
	Federal National Mortgage Assoc.	5.500		2/1/2033		17,464,674		6,144,495		6,073,600
	Federal National Mortgage Assoc.	5.500		2/1/2035		5,014,015		3,066,745		3,030,676
	Federal National Mortgage Assoc.	5.000		7/1/2035		15,659,841		13,178,821		12,661,887
	Federal National Mortgage Assoc.	5.500		10/1/2020		1,641,812		1,178,209		1,180,664
	Federal National Mortgage Assoc.	5.500		3/1/2021		677,502		561,380		562,448
	Federal National Mortgage Assoc.	5.500		6/1/2036		1,001,094		912,150		898,951
	Federal National Mortgage Assoc.	5.500		3/1/2021		654,254		539,250		540,276
	Federal National Mortgage Assoc.	6.000		6/1/2037		910,396		896,952		903,619
	JP Morgan Chase Capital XXV	6.800		10/1/2037		4,375,000		4,375,000		4,370,175
									$	53,113,688

ANNUAL REPORT OCTOBER 31, 2007 74

Notes to Financial Statements (continued)

Trust/Counter Party	Description	Rate		Maturity Date	Original Face		Current Face		Market Value
Income Opportunity (cont’d)
Lehman Brothers	U.S. Treasury Notes	4.750	%	8/15/2017	$	9,415,000	$	9,415,000	$	9,622,422
	Resolution Funding Corp.	0.000		4/15/2030		6,055,000		6,055,000		2,018,561
	Federal Home Loan Mortgage Corp.	5.067		1/1/2035		7,644,276		1,881,935		1,858,585
	Federal National Mortgage Assoc.	5.500		7/1/2016		1,539,074		481,759		484,728
	Federal National Mortgage Assoc.	5.500		3/1/2018		4,172,428		485,682		488,057
	Federal National Mortgage Assoc.	5.500		11/1/2017		3,217,577		496,702		499,351
	Federal National Mortgage Assoc.	5.500		8/1/2017		3,622,323		1,075,243		1,080,979
									$	16,052,683
Morgan Stanley	Michaels Stores, Inc.	11.375		11/1/2016		670,000		670,000	$	668,325
Income Trust
Lehman Brothers	U.S. Treasury Strip Principal	0.000		11/15/2024		56,630,000		56,630,000	$	24,656,589
	Resolution Funding Corp.	0.000		4/15/2030		12,440,000		12,440,000		4,147,135
	Federal Home Loan Mortgage Corp.	5.500		3/1/2022		6,083,988		5,641,353		5,650,273
									$	34,453,997
Limited Duration
Barclay’s Bank	Huntsman LLC	11.625		10/15/2010		1,495,000		1,495,000	$	1,584,700
	Midwest Generation LLC	8.560		1/2/2016		5,180,000		4,324,265		4,648,585
	Turkey	7.000		9/26/2016		5,093,000		5,093,000		5,328,806
	Columbia	9.750		4/23/2009		5,000,000		6,144,495		6,543,887
	Group 1 Automotive, Inc.	8.250		8/15/2013		5,000,000		5,000,000		5,000,000
	Rite Aid Corp.	8.125		5/1/2010		3,429,659		5,000,000		5,031,250
	Freeport-McMoRan Copper & Gold, Inc.	8.375		4/1/2017		3,034,000		3,034,000		3,322,230
	Comcast Cable Communications LLC	6.875		6/15/2009		2,907,000		2,907,000		2,980,881
	Reynolds American, Inc.	7.625		6/1/2016		756,000		756,000		817,930
									$	35,258,269
Credit Suisse	Rouse Co. LP	5.375		11/26/2013		2,000,000		2,000,000	$	1,812,352
	Deutsche Telekom Intl. Finance BV	8.000		6/15/2010		5,000,000		5,000,000		5,361,380
	Daimler Finance North America LLC	4.050		6/4/2008		7,500,000		7,500,000		7,439,415
	DR Horton, Inc.	5.875		7/1/2013		3,000,000		3,000,000		2,688,714
	JC Penney Corp., Inc.	8.000		3/1/2010		4,400,000		4,400,000		4,687,540
	Comcast Cable Communications LLC	6.875		6/15/2009		2,185,000		2,185,000		2,240,532
	Windstream Corp.	8.125		8/1/2013		2,340,000		2,340,000		2,474,550
	Sanmina-SCI Corp.	8.125		3/1/2016		1,710,000		1,710,000		1,500,525
	Michaels Stores, Inc.	11.375		11/1/2016		2,800,000		2,800,000		2,793,000
	Celestica, Inc.	7.625		7/1/2013		1,965,000		1,965,000		1,886,400
	Chesapeake Energy Corp.	7.500		9/15/2013		4,000,000		4,000,000		4,110,000
	American Real Estate Partners LP/American
	Real Estate Finance Corp.	8.125		6/1/2012		5,390,000		5,390,000		5,430,425
	Qwest Corp.	8.875		3/15/2012		2,640,000		2,640,000		2,890,800
	Rite Aid Corp.	7.500		3/1/2017		1,628,000		1,628,000		1,514,040
									$	46,829,673
Lehman Brothers	NewPage Corp	11.606		5/1/2012		1,500,000		1,500,000	$	1,616,250
	Metaldyne Corp.	10.000		11/1/13		1,000,000		1,000,000		930,000
	Grant Prideco Inc	6.125		8/15/2015		380,000		380,000		381,900
	U.S. Treasury Notes	3.375		9/15/2009		3,425,000		3,425,000		3,391,284
	U.S. Treasury Notes	3.375		12/15/2008		17,000,000		17,000,000		16,881,799
	U.S. Treasury Notes	4.250		8/15/2015		1,815,000		1,815,000		1,801,388
	U.S. Treasury Notes	3.875		5/15/2009		5,945,000		5,945,000		5,937,105
	Sally Holdings LLC	10.500		11/15/2016		1,790,000		1,790,000		1,781,050
									$	32,720,776
Preferred and Equity
Credit Suisse	Michaels Stores, Inc.	11.375		11/1/2016		5,000,000		5,000,000	$	4,987,500
	ICICI Bank Ltd.	7.250		N/A1		6,600,000		6,600,000		6,128,298
									$	11,115,798
Lehman Brothers	BOI Capital Funding No. 3	6.107		N/A1		30,000,000		30,000,000	$	27,601,950
	State Street Capital Trust IV	6.694		6/15/2037		28,305,000		28,305,000		25,559,273
	Swiss Re Capital I LP	6.854		N/A1		25,000,000		25,000,000		25,215,175
									$	78,376,398
Strategic Bond
Morgan Stanley	Michaels Stores, Inc.	11.375		11/1/2016		430,000		430,000	$	428,925

¹ The security is a perpetual bond and has no stated maturity date.

75 ANNUAL REPORT OCTOBER 31, 2007

Notes to Financial Statements (continued)

Note 5. Commitments

Bridge Debt Commitments: Limited Duration may invest in floating rate senior loans. In connection with these investments, Limited Duration may, with its Manager, also enter into senior unsecured bridge financing commitments. Bridge financing commitments may obligate Limited Duration to furnish temporary financing to a borrower until permanent financing can be arranged. These commitments range in duration from 43 to 294 days. At October 31, 2007, Limited Duration had outstanding bridge financing commitments of $20,740,000. In connection with these commitments, Limited Duration earns a commitment fee, typically set as a percentage of the commitment amount. Such fee income, which is classified in the statement of operations as interest income, is recognized ratably over the commitment period. During the year ended October 31, 2007, Limited Duration earned $254,615 in commitment fee income and the unrecognized commitment fee income is recoded on the statement of assets and liabilities as “deferred income liability.”

Note 6. Income Tax Information

No provision is made for U.S. federal taxes as it is the portfolios intention to continue to qualify for and elect the tax treatment applicable to regulated investment companies under Subchapter M of the Internal Revenue Code of 1986, as amended, and to make the requisite distributions to its shareholders which will be sufficient to relieve it from federal income and excise taxes.

Dividends from net investment income and distributions from net capital gains are determined in accordance with U.S. federal income tax regulations, which may differ from those amounts determined under accounting principles generally accepted in the United States. These Book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, they are charged or credited to paid-in-capital, undistributed net investment income, or accumulated net realized gain, as appropriate, in the period the difference arise.

Reclassification of Capital Accounts: The following permanent differences as of October 31, 2007, attributable to swap income/(loss), transactions involving foreign securities and currencies, expiration of capital loss carryfor-wards and other differences between financial reporting and tax accounting were reclassified to the following accounts.

Trust	Undistributed Net Investment Income/ Distributions in Excess of Net Investment Income				Accumulated Gain/(Loss)			Paid In Capital
Broad Investment Grade		$	282,885		$	172		$	(283,057	)
Core Bond			786,797			(786,797	)		—
High Yield			2,368			2,556,500			(2,558,868	)
Income Opportunity			1,070,069			(1,070,069	)		—
Income Trust			(5,959,196	)		39,067,148			(33,107,952	)
Limited Duration			(2,414,790	)		2,414,790			—
Preferred and Equity			(48,592	)		78,130			(29,538	)

The tax character of distributions paid during the year ended October 31, 2007 and 2006 were as follows:

	Year ended October 31, 2007
Distributions Paid from:	Ordinary Income		Non-taxable Return of Capital		Long-term Capital Gains		Total Distributions
Broad Investment Grade	$	4,490,035	$	—	$	—	$	4,490,035
Core Bond		11,064,934		5,227,386		—		16,292,320
High Yield		3,927,807		—		—		3,927,807
Income Opportunity		20,862,233		1,874,570		—		22,736,803
Income Trust		18,808,452		4,978,175		—		23,786,627
Limited Duration		51,967,739		1,074,826		2,229,742		55,272,307
Preferred and Equity		65,002,006		24,171,991		—		89,173,997
Strategic Bond		6,521,963		—		—		6,521,963

	Year ended October 31, 2006
Distributions Paid from:	Ordinary Income		Non-taxable Return of Capital		Long-term Capital Gains		Total Distributions
Broad Investment Grade	$	4,241,016	$	—	$	20,078	$	4,261,094
Core Bond		25,048,230		—		7,914,351		32,962,581
High Yield		4,175,232		—		—		4,175,232
Income Opportunity		22,238,533		2,162,198		8,976,685		33,377,416
Income Trust		21,910,288		5,576,693		—		27,486,981
Limited Duration		55,725,066		760,960		—		56,486,026
Strategic Bond		6,969,104		251,641		—		7,220,745

As of October 31, 2007, the components of distributable earnings on a tax basis were as follows:

Trust	Undistributed Ordinary Income			Undistributed Long-term Gains/ Capital Loss Carryforward Amount			Unrealized Gain/(Loss) Net
Broad Investment Grade	$	4,855,266		$	(3,222,226	)	$	(287,678	)
Core Bond		(2,423,603	)		(9,296,969	)		(833,467	)
High Yield		148,061			(36,514,583	)		(3,298,228	)
Income Opportunity		—			(4,794,548	)		(1,062,523	)
Income Trust		—			(66,753,313	)		3,726,058
Limited Duration		—			—			(18,232,683	)
Preferred and Equity		—			(49,741,712	)		(47,853,961	)
Strategic Bond		214,202			(447,113	)		(808,018	)

ANNUAL REPORT OCTOBER 31, 2007 76

Notes to Financial Statements (concluded)

For federal income tax purposes, the following Trusts had capital loss carry-forward as of their last respective tax year-end. These amounts may be used to offset future realized capital gains, if any:

Trust	Capital Loss Carryforward Amount		Expires
Broad Investment Grade	$	2,061,303	2011
		684,360	2012
		479,567	2014
	$	3,225,230
Core Bond	$	6,643,266	2014
High Yield	$	3,270,311	2008
		15,159,280	2009
		8,468,860	2010
		4,771,417	2011
		316,410	2012
		2,060,533	2014
		2,467,773	2015
	$	36,514,584
Income Opportunity	$	2,451,626	2014
		2,342,922	2015
	$	4,794,548
Income Trust	$	1,352,206	2008
		13,940,898	2009
		21,960,613	2011
		10,100,201	2012
		3,861,222	2013
		6,952,429	2014
		8,585,744	2015
	$	66,753,313
Preferred and Equity	$	49,741,712	2015
Strategic Bond	$	447,113	2014

Note 7. Capital

There are 200 million of $0.01 par value common shares authorized for Broad Investment Grade, Income Opportunity and Income Trust. There are an unlimited number of $0.001 par value common shares authorized for Core Bond, High Yield, Limited Duration, Preferred and Equity and Strategic Bond. At October 31, 2007, the shares owned by an affiliate of the Advisor of Limited Duration and Preferred and Equity were 6,021 and 4,817, respectively.

Preferred and Equity, which commenced on December 27, 2006, issued 47,004,817 common shares under the initial public offering. On February 1, 2007, an additional 4,750,000 shares were issued by the underwriters exercising their over-allotment option. Offering costs incurred in connection with the offering of common shares have been charged against the proceeds from the initial common share offering in the amount of $1,367,957.

During the years ended October 31, 2007 and 2006, the following Trusts issued additional shares under their respective dividend reinvestment plan:

Trust	October 31, 2007	October 31, 2006
High Yield	1,496	6,259
Limited Duration	107,367	13,785
Preferred and Equity	73,340	—

As of October 31, 2007, Preferred and Equity has the following series of preferred shares outstanding as listed in the table below. The preferred shares have a liquidation value of $25,000 per share plus any accumulated unpaid dividends.

Series	Shares
T7	4,620
W7	4,620
R7	4,620
F7	4,620

Dividends on seven-day preferred shares are cumulative at a rate which is reset every seven days based on the results of an auction. The dividend ranges on the preferred shares for Preferred and Equity for the period ended October 31, 2007 were as follows:

Series	Low			High			Average
T7		5.05	%		6.40	%		5.38	%
W7		5.08			6.40			5.39
R7		4.99			6.30			5.39
F7		5.00			6.35			5.36

Note 8. Subsequent Events

Subsequent to October 31, 2007, the Board of each of the Trusts declared dividends per common share payable November 30, 2007, to shareholders of record on November 15, 2007. The per share common dividends declared were as follows:

Trust	Common Dividend Per Share
Broad Investment Grade		$	0.04900
Core Bond			0.06700
High Yield			0.05100
Income Opportunity			0.05500
Income Trust			0.03100
Limited Duration			0.12500
Preferred and Equity			0.15625
Strategic Bond			0.07700

The dividends declared on preferred shares for the period November 1, 2007 to November 30, 2007 for Preferred and Equity were as follows:

Series	Dividends Declared
T7	$	458,581
W7		455,301
R7		567,983
F7		574,127

On November 29, 2007, Broad Investment Grade’s Board of Trustees approved a Plan of Liquidation and Dissolution. Accordingly, the Broad Investment Grade will liquidate substantially all of its assets on or about the close of business on December 31, 2009.

77 ANNUAL REPORT OCTOBER 31, 2007

Report of Independent Registered Public Accounting Firm

To the Directors/Trustees and Shareholders of:
     BlackRock Broad Investment Grade 2009 Term Trust Inc.
     BlackRock Core Bond Trust
     BlackRock High Yield Trust
     BlackRock Income Opportunity Trust
     BlackRock Income Trust Inc.
     BlackRock Limited Duration Income Trust
     BlackRock Preferred and Equity Advantage Trust
     BlackRock Strategic Bond Trust
     (Collectively the “Trusts”)

We have audited the accompanying statements of assets and liabilities of the Trusts, including the portfolios of investments, as of October 31, 2007, and the related statements of operations for the year then ended, the statements of changes in net assets and the financial highlights for each of the periods presented. We have also audited the statements of cash flows of BlackRock Core Bond Trust, BlackRock High Yield Trust, BlackRock Income Opportunity Trust, BlackRock Income Trust Inc., BlackRock Limited Duration Income Trust and BlackRock Preferred and Equity Advantage Trust, for the year ended October 31, 2007. These financial statements and financial highlights are the responsibility of the Trusts’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Trusts are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trusts’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2007, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Trusts as of October 31, 2007, the results of their operations and the cash flows of BlackRock Core Bond Trust, BlackRock High Yield Trust, BlackRock Income Opportunity Trust, BlackRock Income Trust Inc., BlackRock Limited Duration Income Trust and BlackRock Preferred and Equity Advantage Trust, for the year then ended, the changes in their net assets and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP

Boston, Massachusetts
December 28, 2007

ANNUAL REPORT OCTOBER 31, 2007 78

The Benefits and Risks of Leveraging (unaudited)

The Trusts may utilize leveraging through borrowings or issuance of short-term debt securities or shares of Preferred Stock. The concept of leveraging is based on the premise that the cost of assets to be obtained from leverage will be based on short-term interest rates on borrowings or dividend rates on the Preferred Stock, which normally will be lower than the income earned by each Trust on its longer-term portfolio investments. To the extent that the total assets of each Trust (including the assets obtained from leverage) are invested in higher-yielding portfolio investments, each Trust’s Common Stock shareholders will be the beneficiaries of the incremental yield.

As of October 31, 2007, the Trusts had the following leverage amounts to total net assets before the deduction of leverage of:

Trust	Leverage%
Core Bond	22%
High Yield	15%
Income Opportunity	22%
Income Trust	8%
Limited Duration	14%
Preferred and Equity	33%

Leverage creates risks for holders of Common Stock including the likelihood of greater net asset value and market price volatility. In addition, there is the risk that fluctuations in interest rates on borrowings or in the dividend rates on any Preferred Stock may reduce the Common Stock’s yield and negatively impact its net asset value and market price. If the income derived from securities purchased with assets received from leverage exceeds the cost of leverage, each Trust’s net income will be greater than if leverage had not been used. Conversely, if the income from the securities purchased is not sufficient to cover the cost of leverage, each Trust’s net income will be less than if leverage had not been used, and therefore the amount available for distribution to Common Stock shareholders will be reduced.

79 ANNUAL REPORT OCTOBER 31, 2007

Dividend Reinvestment Plans (unaudited)

Pursuant to each Trust’s respective Dividend Reinvestment Plan (the “Plan”), common shareholders of Broad Investment Grade, Income Opportunity and Income Trust may elect, while shareholders of Core Bond, High Yield, Limited Duration, Preferred and Equity and Strategic Bond are automatically enrolled, to have all distributions of dividends and capital gains reinvested by Computershare Trust Company, N.A. (the “Plan Agent”) in the respective Trust’s shares pursuant to the Plan. Shareholders who do not participate in the Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street or other nominee name, then to the nominee) by the Plan Agent, which serves as agent for the shareholders in administering the Plan.

After Broad Investment Grade declares a dividend or determines to make a capital gain distribution, the Plan Agent will acquire shares for the participants’ account, by the purchase of outstanding shares on the open market, on the Trust’s primary exchange or elsewhere (“open market purchases”). The Trust will not issue any new shares under the Plan.

After Core Bond, High Yield, Income Trust, Limited Duration, Preferred and Equity and/or Strategic Bond declares a dividend or determines to make a capital gain distribution, the Plan Agent will acquire shares for the participants’ account, depending upon the circumstances described below, either (i) through receipt of unissued but authorized shares from the Trust (“newly issued shares”) or (ii) by open market purchases. If, on the dividend payment date, the net asset value per share (“NAV”) is equal to or less than the market price per share plus estimated brokerage commissions (such condition being referred to herein as “market premium”), the Plan Agent will invest the dividend amount in newly issued shares on behalf of the participants. The number of newly issued shares to be credited to each participant’s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the payment date, the dollar amount of the dividend will be divided by 95% of the market price on the payment date. If, on the dividend payment date, the NAV is greater than the market value per share plus estimated brokerage commissions (such condition being referred to herein as “market discount”), the Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases.

At a meeting of the Board of Trustees of the Income Opportunity Trust on November 21, 2006, the Board approved an amendment to the Dividend Reinvestment Plan of the Income Opportunity Trust. The Plan previously operated in a manner similar to Broad Investment Grade’s Plan, and permitted shares to be purchased only on the open market. As a result of the amendment, the Plan will permit purchases of newly issued shares on terms similar to the Plans described in the next paragraph. This amendment took effect on April 1, 2007.

The Plan Agent’s fees for the handling of the reinvestment of dividends and distributions will be paid by each Trust. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent’s open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any Federal income tax that may be payable on such dividends or distributions.

Each Trust reserves the right to amend or terminate the Plan. There is no direct service charge to participants in the Plan; however, each Trust reserves the right to amend the Plan to include a service charge payable by the participants. Participants who request a sale of shares through the Plan Agent are subject to a $2.50 sales fee and a $0.15 per share sold brokerage commission. All correspondence concerning the Plan should be directed to the Plan Agent at 250 Royall Street, Canton, MA 02021 or (800) 699-1BFM.

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their nonpublic personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal nonpublic information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our Web sites.

BlackRock does not sell or disclose to nonaffiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to service Client accounts. These nonaffiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to nonpublic personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the nonpublic personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

ANNUAL REPORT OCTOBER 31, 2007 80

Additional Information (unaudited)

TAX NOTICE

The following information is provided with respect to the distributions paid by the BlackRock Closed-End Funds for the fiscal year ended October 31, 2007:

	Payable Date	Federal Obligation Interest1		Interest Related Dividends for Non- U.S. Residents2		Long-Term Capital Gains Per Share ($)
Broad Investment Grade 2009 Term Trust (BCT)	11/30/06 –1/31/07	3.48	%	8.50	%	—
	2/28/07 – 10/31/07	2.13	%	42.10	%	—
High Yield Trust (BHY)	11/30/06 – 1/31/07	2.08	%	58.91	%	—
	2/28/07 – 10/31/07	1.78	%	87.67	%	—
Income Opportunity Trust (BNA)	11/30/06 – 1/31/06	8.24	%	51.11	%	—
	2/28/07 – 10/31/07	1.97	%	100	%
Income Trust (BKT)	11/30/06 – 1/31/07	7.80	%	58.17	%	—
	2/28/07 – 10/31/07	12.22	%	84.45	%	—
Limited Duration Income Trust (BLW)	11/30/06 – 1/31/07	2.41	%	57.97	%	—
	2/28/07 – 9/30/07	1.93	%	100	%	—
	10/31/07	1.93	%	100	%	0.060444
Preferred and Equity Advantage Trust (BTZ)*	1/31/07 – 10/31/07	2.31	%	37.89	%	—
Strategic Bond Trust (BHD)	11/30/06 – 1/31/07	2.50	%	57.18	%	—
	2/28/07 – 10/31/07	3.76	%	100	%	—

*	Of the ordinary distributions paid by Preferred and Equity Advantage Trust, 37 percent consist of qualified dividend income for individuals and dividends qualifying for the dividends received deduction for corporations.
1	The law varies in each state as to whether and what percentage of dividend income attributable to Federal Obligations is exempt from state income tax. We recommend that you consult your tax advisor to determine if any portion of the dividends you received is exempt from state income taxes.
2	Represents the portion of the distributions paid that are exempt from U.S withholding tax for nonresident aliens and foreign corporations.

In January 2008, a form 1099-DIV will be sent to shareholders which will state the amount and composition of distributions and provide information with respect to their appropriate tax treatment.

81 ANNUAL REPORT OCTOBER 31, 2007

Additional Information (unaudited) (continued)

Shareholder Meetings

The Joint Annual Meeting of Shareholders was held on August 16, 2007 for shareholders of record on June 20, 2007, to elect director or trustee nominees of each Trust. This proposal was part of the reorganization of the Trust’s Boards of Trustees (the “Boards”) to take effect on or about November 1, 2007. The Board is organized into three classes one class of which is elected annually. Each Trustee serves a three-year term concurrent with the class into which he or she is elected.

Approved the Class I Directors/Trustees as follows:

	G. Nicholas Beckwith, III				Kent Dixon				R. Glenn Hubbard
	Votes For		Votes Withheld		Votes For		Votes Withheld		Votes For		Votes Withheld
Broad Investment Grade		2,600,006		20,037		2,600,006		20,037		2,600,006		20,037
Core Bond		21,540,504		205,001		21,534,431		211,073		21,540,366		205,138
High Yield		5,938,569		96,163		5,941,585		93,147		5,937,943		96,789
Income Opportunity		27,451,182		274,088		27,449,422		275,848		27,444,122		281,147
Income Trust		54,004,899		878,220		54,007,568		875,552		54,012,161		870,958
Limited Duration		31,528,458		301,321		31,522,202		307,576		31,527,975		301,804
Preferred and Equity		49,178,575		636,127		49,172,672		642,030		49,178,097		636,605
Strategic Bond		5,838,976		188,565		5,839,626		187,915		5,838,876		188,665

	W. Carl Kester						Robert S. Salomon, Jr.
	Votes For			Votes Withheld			Votes For		Votes Withheld
Broad Investment Grade		2,600,006			20,037			2,600,006		20,037
Core Bond		21,542,541			202,963			21,532,904		212,601
High Yield		5,940,393			94,339			5,941,060		93,672
Income Opportunity		27,459,822			265,448			27,427,963		297,307
Income Trust		540,145,471			868,572			53,998,127		884,992
Limited Duration		31,535,465			294,314			31,529,737		300,042
Preferred and Equity		12,415	1		63	1		49,178,951		635,751
Strategic Bond		5,839,476			188,065			5,839,776		187,765

Approved the Class II Directors/Trustees as follows:

	Richard S. Davis				Frank J. Fabozzi						James T. Flynn
	Votes For		Votes Withheld		Votes For			Votes Withheld			Votes For		Votes Withheld
Broad Investment Grade		2,600,006		20,037		2,600,006			20,037			2,600,006		20,037
Core Bond		21,528,535		216,970		21,543,679			201,825			21,535,708		209,796
High Yield		5,939,343		95,389		5,938,756			95,976			5,941,378		93,354
Income Opportunity		27,452,493		272,777		27,456,158			269,112			27,447,610		277,660
Income Trust		54,011,445		871,675		54,017,461			865,659			54,012,426		870,694
Limited Duration		31,533,743		296,036		31,534,354			295,425			31,531,608		298,171
Preferred and Equity		49,181,551		633,151		12,415	1		63	1		49,179,416		635,286
Strategic Bond		5,839,276		188,265		5,836,791			190,750			5,839,776		187,765

	Karen P. Robards
	Votes For		Votes Withheld
Broad Investment Grade		2,600,006		20,037
Core Bond		21,546,810		198,695
High Yield		5,939,791		94,941
Income Opportunity		27,457,771		267,499
Income Trust		54,006,888		876,232
Limited Duration		31,534,697		295,081
Preferred and Equity		49,180,119		634,583
Strategic Bond		5,839,676		187,865

1 Voted on by holders of preferred shares only.

ANNUAL REPORT OCTOBER 31, 2007 82

Additional Information (unaudited) (concluded)

Approved the Class III Directors/Trustees as follows:

	Richard E. Cavanagh				Kathleen F. Feldstein				Henry Gabbay
	Votes For		Votes Withheld		Votes For		Votes Withheld		Votes For		Votes Withheld
Broad Investment Grade		2,600,006		20,037		2,600,006		20,037		2,600,006		20,037
Core Bond		21,545,394		200,110		21,537,449		208,056		21,528,340		217,164
High Yield		5,939,949		94,783		5,937,482		97,250		5,939,881		94,851
Income Opportunity		27,447,696		277,574		27,434,374		290,896		27,449,506		275,764
Income Trust		54,014,874		868,245		53,992,362		890,757		54,015,668		867,452
Limited Duration		31,529,595		300,184		31,523,085		306,693		31,527,485		302,294
Preferred and Equity		49,151,157		663,545		49,177,230		637,472		49,184,426		630,276
Strategic Bond		5,839,176		188,365		5,838,876		188,665		5,839,926		187,615

	Jerrold B. Harris
	Votes For		Votes Withheld
Broad Investment Grade		2,600,006		20,037
Core Bond		21,544,954		200,551
High Yield		5,941,378		93,354
Income Opportunity		27,441,156		284,114
Income Trust		54,010,458		872,661
Limited Duration		31,525,195		304,584
Preferred and Equity		49,180,428		634,274
Strategic Bond		5,838,976		188,565

The following Trusts had an additional proposal (Proposal #2) to amend their respective Declarations of Trust to increase the maximum number of Board Members to 15:

	Votes For		Votes Against		Votes Abstain
Core Bond		21,397,280		273,953		74,272
High Yield		5,853,627		164,515		16,590
Limited Duration		30,858,715		452,424		518,639
Preferred and Equity		48,460,779		990,861		363,061
Strategic Bond		5,817,653		131,815		78,074

Each Trust listed for trading on the New York Stock Exchange (“NYSE”) has filed with the NYSE its annual chief executive officer certification regarding compliance with the NYSE’s listing standards and each Trust listed for trading on the American Stock Exchange (“AMEX”) has filed with the AMEX its corporate governance certification regarding compliance with the AMEX’s listing standards. All of the Trusts have filed with the Securities and Exchange Commission the certification of its chief executive officer and chief financial officer required by section 302 of the Sarbanes-Oxley Act.

The Trusts do not make available copies of their respective Statements of Additional Information because the Trusts’ shares are not continuously offered, which means that the Statement of Additional Information of each Trust has not been updated after completion of such Trust’s offering and the information contained in each Trust’s Statement of Additional Information may have become outdated.

During the period, there were no material changes in any Trust’s investment objective or policies or to any Trust’s charters or by-laws that were not approved by the shareholders or in the principal risk factors associated with investment in the Trusts.

Quarterly performance and other information regarding the Trusts may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Trusts and does not, and is not intended, to incorporate BlackRock’s website into this report.

83 ANNUAL REPORT OCTOBER 31, 2007

Section 19 Notices (unaudited)

The amounts and sources of distributions reported are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon the Trust’s investment experience during the remainder of its fiscal year and may be subject to changes based on the tax regulations. The Trust will send you a Form 1099-DIV for the calendar year that will tell you how to report these distributions for federal income tax purposes.

	Total Fiscal Year to Date Cumulative Distributions by Character								Percentage of Fiscal Year to Date Cumulative Distributions by Character
Trust	Net Investment Income		Net Realized Capital Gains		Return of Capital		Total Per Common Share		Net Investment Income			Net Realized Capital Gains			Return of Capital			Total Per Common Share
Core Bond	$	0.72	$	—	$	0.09	$	0.80		89	%		—	%		11	%		100	%
Income Opportunity		0.61		—		0.05		0.66		92			—			8			100
Income Trust		0.32		—		0.05		0.37		85			—			15			100
Preferred and Equity		0.89		—		0.52		1.41		63			—			37			100

Each Trust estimates that it has distributed more than its income and net realized gains; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the money that you invested in the Fund is paid back to the shareholder. A return of capital does not necessarily reflect the Fund’s investment performance and should not be confused with ‘yield’ or ‘income’.

ANNUAL REPORT OCTOBER 31, 2007 84

Directors/Trustees Information (unaudited)

Name, Address and Year of Birth	Current Positions Held With the Trusts	Term of Office and Length of Time Served	Principal Occupations During the Past Five Years	Number of Portfolios Overseen Within the Fund Complex1	Other Directorships Held Outside the Fund Complex1	Events or Transactions by Reason of Which the Trustee is an Interested Person as Defined in Section 2(a) (19) of the 1940 Act
Interested Director/Trustee2
Ralph L. Schlosstein BlackRock, Inc. 40 East 52nd Street New York, NY 10022 1951	Chairman of the Board3	3 years4/ since inception	Director from 1999 to 2007 and President of BlackRock, Inc. from 1998 to 2007. Chairman and President of the BlackRock Liquidity Funds.	70	None	Former Director and President of the Advisor until September 2007.

1	The Fund Complex means two or more registered investment companies that: (1) hold themselves out to investors as related companies for purposes of investment and investor services; or (2) have a common investment advisor or have an investment advisor that is an affiliated person of the investment advisor of any of the other registered investment companies.
2	Interested Director/Trustee as defined by Section 2(a)(19) of the Investment Company Act of 1940.
3	Director/Trustee since inception; appointed Chairman of the Board on August 22, 2002.
4	The Board is classified into three classes of which one class is elected annually. Each Director/Trustee serves a three-year term concurrent with the class from which they are elected.

85 ANNUAL REPORT OCTOBER 31, 2007

Directors/Trustees Information (unaudited) (continued)

Name, Address and Year of Birth	Current Positions Held With the Trusts	Term of Office and Length of Time Served	Principal Occupations During the Past Five Years	Number of Portfolios Overseen Within the Fund Complex1	Other Directorships Held Outside the Fund Complex
Independent Directors/Trustees
Richard E. Cavanagh P.O. Box 4546 New York, NY 10163-4546 1946	Lead Trustee Audit Committee Member2	3 years3/since inception	Trustee, Aircraft Finance Trust (AFT) from 1999 to the present; Director, The Guardian Life Insurance Company of America and The Mutual Life Insurance Company from 1998 to the present; Trustee, Educational Testing Service (ETS) from 1997 until the present; Director, the Freemont Group from 1996 until the present. President and Chief Executive Officer of The Conference Board, Inc. (a leading global busi- ness research organization) from 1995 to 2007.	60	Arch Chemical (Chemicals and Allied Products).
Kent Dixon P.O. Box 4546 New York, NY 10163-4546 1937	Trustee Audit Committee Member2	3 years3/since inception	Consultant/Investor since 1988.	60	None
Frank J. Fabozzi P.O. Box 4546 New York, NY 10163-4546 1948	Trustee Audit Committee Member2	3 years3/since inception	Consultant/Editor of, “The Journal of Portfolio Management”; Yale University, School of Management, Professor in the Practice of Finance and Becton Fellow from 2006 until present; Adjunct Professor of Finance and Becton Fellow from 2005 to 2006; Professor in the practice of Finance from 2003 to 2005; Adjunct Professor of Finance from 1994 to 2003; Author and Editor.	60	None

1	The Fund Complex means two or more registered investments companies that: (1) hold themselves out to investors as related companies for purposes of investment and investor services; or (2) have a common investment advisor or have an investment advisor that is an affiliated person of the investment advisor of any of the other registered investment companies.
2	The Board of each Trust has determined that each Trust has three Audit Committee financial experts serving on its Audit Committee, Mr. Cavanagh, Mr. Dixon and Mr. Fabozzi, each of whom is independent for the purpose of the definition of Audit Committee financial expert as applicable to the Trusts.
3	The Board is classified into three classes of which one class is elected annually. Each Director/Trustee serves a three-year term concurrent with the class from which they are elected.

ANNUAL REPORT OCTOBER 31, 2007 86

Directors/Trustees Information (unaudited) (concluded)

Name, Address and Year of Birth	Current Positions Held With the Trusts	Term of Office and Length of Time Served	Principal Occupations During the Past Five Years	Number of Portfolios Overseen Within the Fund Complex1	Other Directorships Held Outside the Fund Complex
Independent Directors/Trustees
Kathleen F. Feldstein P.O. Box 4546 New York, NY 10163-4546 1941	Trustee	3 years3/since January 19, 2005	President of Economic Studies, Inc., (a Belmont MA-based private economic consulting firm) since 1987; Chair, Board of Trustees, McLean Hospital since 2000. Member of the Board of Partners Community Healthcare, Inc. from 2005 until the present; Member of the Board of Partners HealthCare and Sherrill House from 1990 to the present; Trustee, Museum of Fine Arts, Boston from 1992 until the present and a Member of the Visiting Committee to the Harvard University Art Museum from 2003 to the present; Trustee, The Committee for Economic Development (a research organization of business leaders and educators) from 1990 to the present; Member of the Advisory Board to the International School of Business, Brandeis University from 2002 to the present.	60	Director, The McClatchy Company.
R. Glenn Hubbard P.O. Box 4546 New York, NY 10163-4546 1958	Trustee	3 years3/since November 16, 2004	Dean of Columbia Business School since 2004; Columbia faculty member since 1988; Co-director of Columbia Business School’s Entrepreneurship Program 1997 to 2004; Visiting Professor at the John F. Kennedy School of Government at Harvard University and the Harvard Business School from 1985, as well as the University of Chicago from 1994; Deputy Assistant Secretary of the U.S. Treasury Department for Tax Policy from 1991 to 1993; Chairman of the U.S. Council of Economic Advisers under the President of the United States from 2001 to 2003.	60	ADP, KKR Financial Corporation, Duke Realty, Metropolitan Life Insurance Company.

1	The Fund Complex means two or more registered investments companies that: (1) hold themselves out to investors as related companies for purposes of investment and investor services; or (2) have a common investment advisor or have an investment advisor that is an affiliated person of the investment advisor of any of the other registered investment companies.
2	The Board of each Trust has determined that each Trust has three Audit Committee financial experts serving on its Audit Committee, Mr. Cavanagh, Mr. Dixon and Mr. Fabozzi, each of whom is independent for the purpose of the definition of Audit Committee financial expert as applicable to the Trusts.
3	The Board is classified into three classes of which one class is elected annually. Each Director/Trustee serves a three-year term concurrent with the class from which they are elected.

87 ANNUAL REPORT OCTOBER 31, 2007

BlackRock Closed-End Funds

Officers

Robert S. Kapito, President

Donald C. Burke, Treasurer

Bartholomew Battista, Chief Compliance Officer

Anne Ackerley, Vice President

Vincent B. Tritto, Secretary

Investment Advisor

BlackRock Advisors, LLC

100 Bellevue Parkway

Wilmington, DE 19809

(800) 227-7BFM

Sub-Advisor

BlackRock Financial Management, Inc.¹

40 East 52nd Street

New York, NY 10022

BlackRock Investment Management, LLC²

40 East 52nd Street

New York, NY 10022

Accounting Agent and Custodian

State Street Bank and Trust Company

2 Avenue De Lafayette

Boston, MA 02111

Transfer Agent

Computershare Trust Company, N.A.

250 Royall Street

Canton, MA 02021

(800) 699-1BFM

Auction Agent²

Bank of New York

101 Barclay Street, 7 West

New York, NY 10286

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

200 Berkeley Street

Boston, MA 02116

Legal Counsel

Skadden, Arps, Slate, Meagher & Flom LLP

Four Times Square

New York, NY 10036

Legal Counsel – Independent Trustees

Debevoise & Plimpton LLP

919 Third Avenue

New York, NY 10022

This report is for shareholder information. This is not a prospectus intended for use in the purchase or sale of Trust shares. Statements and other information contained in this report are as dated and are subject to change.

BlackRock Closed-End Funds
c/o BlackRock Advisors, LLC
100 Bellevue Parkway
Wilmington, DE 19809
(800) 227-7BFM

1	For Core Bond, Limited Duration, Preferred and Equity and Strategic Bond.
2	For Preferred and Equity.

The Trusts will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact the Trusts at (800) 699-1BFM.

The Trusts have delegated to the Advisor the voting of proxies relating to their voting securities pursuant to the Advisor’s proxy voting policies and procedures. You may obtain a copy of these proxy voting policies and procedures, without charge, by calling (800) 699-1BFM. These policies and procedures are also available on the website of the Securities and Exchange Commission (the “Commission”) at http://www.sec.gov.

Information on how proxies relating to the Trusts’ voting securities were voted by the Advisor during the most recent 12-month period ended June 30th is available without charge, upon request, by calling (800) 699-1BFM or on the website of the Commission at http://www.sec.gov.

The Trusts file their complete schedule of portfolio holdings for the first and third quarters of their respective fiscal years with the Commission on Form N-Q. Each Trust’s Form N-Q is available on the Commission’s website at http://www.sec.gov. Each Trust’s Form N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. Information regarding the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. Each Trust’s Form N-Q may also be obtained without charge, upon request, by calling (800) 699-1BFM.

ANNUAL REPORT OCTOBER 31, 2007

This report is for shareholder information. This is not a prospectus intended for use in the purchase or sale of Trust shares. Statements and other information contained in this report are as dated and are subject to change.
CEF-ANN-3-1007

Item 2 –	Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant's principal executive officer, principal financial officer and principal accounting officer, or persons performing similar functions. During the period covered by this report, there have been no amendments to or waivers granted under the code of ethics. A copy of the code of ethics is available without charge at www.blackrock.com.
Item 3 –	Audit Committee Financial Expert – The registrant's board of directors or trustees, as applicable (the “board of directors”) has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:
	Kent Dixon Frank J. Fabozzi Dr. Andrew F. Brimmer (retired as of December 31, 2006) Robert S. Salomon, Jr. (term began effective November 1, 2007) W. Carl Kester (term began effective November 1, 2007) James T. Flynn (term began effective November 1, 2007) Karen P. Robards (term began effective November 1, 2007)
	The registrant's board of directors has determined that W. Carl Kester and Karen P. Robards qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.
	Prof. Kester has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Prof. Kester has been involved in providing valuation and other financial consulting services to corporate clients since 1978. Prof. Kester’s financial consulting services present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant’s financial statements.
	Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been President of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is the member of the Audit Committees of one publicly held company and a non-profit organization.
	Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification.

Item 4 – Principal Accountant Fees and Services

	(a) Audit Fees		(b) Audit-Related Fees1		(c) Tax Fees2		(d) All Other Fees3
	Current	Previous	Current	Previous	Current	Previous	Current	Previous
	Fiscal Year	Fiscal Year	Fiscal Year	Fiscal Year	Fiscal Year	Fiscal Year	Fiscal Year	Fiscal Year
Entity Name	End	End	End	End	End	End	End	End
BlackRock Strategic   Bond Trust	$32,000	$32,000	$0	$0	$6,100	$8,000	$1,042	$700

¹ The nature of the services include assurance and related services reasonably related to the performance of the audit of financial statements not included in Audit Fees.

² The nature of the services include tax compliance, tax advice and tax planning.

³ The nature of the services include a review of compliance procedures and attestation thereto.

(e)(1)	Audit Committee Pre-Approval Policies and Procedures:
The registrant has polices and procedures (the "Policy") for the pre-approval by the registrant's audit committee of Audit, Audit-Related, Tax and Other Services (as each is defined in the Policy) provided by the Fund's independent auditor (the "Independent Auditor") to the registrant and other "Covered Entities" (as defined below). The term of any such pre-approval is 12 months from the date of pre-approval, unless the audit committee specifically provides for a different period. The amount of any such pre-approval is set forth in the appendices to the Policy (the "Service Pre-Approval Documents"). At its first meeting of each calendar year, the audit committee will review and re-approve the Policy and approve or re-approve the Service Pre-Approval Documents for that year, together with any changes deemed necessary or desirable by the audit committee. The audit committee may, from time to time, modify the nature of the services pre-approved, the aggregate level of fees pre-approved or both.
For the purposes of the Policy, "Covered Services" means (A) all engagements for audit and non-audit services to be provided by the Independent Auditor to the Fund and (B) all engagements for non-audit services related directly to the operations and financial reporting or the Fund to be provided by the Independent Auditor to any Covered Entity, "Covered Entities" means (1) the Advisor or (2) any entity controlling, controlled by or under common control with the Advisor that provides ongoing services to the Fund.
In the intervals between the scheduled meetings of the audit committee, the audit committee delegates pre-approval authority under this Policy to the Chairman of the audit committee (the "Chairman"). The Chairman shall report any pre-approval decisions under this Policy to the audit committee at its next scheduled meeting. At each scheduled meeting, the audit committee will review with the Independent Auditor the Covered Services pre-approved by the Chairman pursuant to delegated authority, if any, and the fees related thereto. Based on these reviews, the audit committee can modify, at its discretion, the pre-approval originally granted by the Chairman pursuant to delegated authority. This modification can be to the nature of services pre-approved, the aggregate level of fees approved, or both. Pre-approval of Covered Services by the Chairman pursuant to delegated authority is expected to be the exception rather than the rule and the audit committee may modify or withdraw this delegated authority at any time the audit committee determines that it is appropriate to do so.
Fee levels for all Covered Services to be provided by the Independent Auditor and pre-approved under this Policy will be established annually by the audit committee and set forth in the Service Pre-Approval Documents. Any increase in pre-approved fee levels will require specific pre-approval by the audit committee (or the Chairman pursuant to delegated authority).

     The terms and fees of the annual Audit services engagement for the Fund are subject to the specific pre-approval of the audit committee. The audit committee (or the Chairman pursuant to delegated authority) will approve, if necessary, any changes in terms, conditions or fees resulting from changes in audit scope, Fund structure or other matters.

     In addition to the annual Audit services engagement specifically approved by the audit committee, any other Audit services for the Fund not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the audit committee (or the Chairman pursuant to delegated authority).

     Audit-Related services are assurance and related services that are not required for the audit, but are reasonably related to the performance of the audit or review of the financial statements of the registrant and, to the extent they are Covered Services, the other Covered Entities (as defined in the Joint Audit Committee Charter) or that are traditionally performed by the Independent Auditor. Audit-Related services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the audit committee (or the Chairman pursuant to delegated authority).

     The audit committee believes that the Independent Auditor can provide Tax services to the Covered Entities such as tax compliance, tax planning and tax advice without impairing the auditor’s independence. However, the audit committee will not permit the retention of the Independent Auditor in connection with a transaction initially recommended by the Independent Auditor, the sole business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. Tax services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the audit committee (or the Chairman pursuant to delegated authority).

     All Other services that are covered and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the audit committee (or the Chairman pursuant to delegated authority).

     Requests or applications to provide Covered Services that require approval by the audit committee (or the Chairman pursuant to delegated authority) must be submitted to the audit committee or the Chairman, as the case may be, by both the Independent Auditor and the Chief Financial Officer of the respective Covered Entity, and must include a joint statement as to whether, in their view, (a) the request or application is consistent with the rules of the Securities and Exchange Commission ("SEC") on auditor independence and (b) the requested service is or is not a non-audit service prohibited by the SEC. A request or application submitted to the Chairman between scheduled meetings of the audit committee should include a discussion as to why approval is being sought prior to the next regularly scheduled meeting of the audit committee.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g) Affiliates’ Aggregate Non-Audit Fees:

	Current Fiscal Year	Previous Fiscal Year
Entity Name	End	End
BlackRock Strategic Bond Trust	$291,642	$294,900

	(h) The registrant’s audit committee has considered and determined that the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any non-affiliated sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by the registrant’s investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
	Regulation S-X Rule 2-01(c)(7)(ii) – $284,500, 0%
Item 5 –	Audit Committee of Listed Registrants – The following individuals are members of the registrant’s separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)):
	Dr. Andrew F. Brimmer (retired as of December 31, 2006) Richard E. Cavanagh (not reappointed to Audit Committee as of November 1, 2007) Kent Dixon Frank J. Fabozzi Robert S. Salomon, Jr. (term began effective November 1, 2007) W. Carl Kester (term began effective November 1, 2007) James T. Flynn (term began effective November 1, 2007) Karen P. Robards (term began effective November 1, 2007)
Item 6 –	Schedule of Investments – The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form.
Item 7 –	Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – The registrant has delegated the voting of proxies relating to Fund portfolio securities to its investment adviser, BlackRock Advisors, LLC and its sub-adviser, as applicable. The Proxy Voting Policies and Procedures of the adviser and sub-adviser are attached hereto as Exhibit 99.PROXYPOL.
	Information about how the Fund voted proxies relating to securities held in the Fund’s portfolio during the most recent 12 month period ended June 30 is available without charge (1) at www.blackrock.com and (2) on the Commission’s web site at http://www.sec.gov.
Item 8 –	Portfolio Managers of Closed-End Management Investment Companies – as of October 31, 2007.
	(a)(1) BlackRock Strategic Bond Trust is managed by a team of investment professionals comprised of Robert S. Kapito, Vice Chairman and a Director of BlackRock, Michael P. Lustig, Managing Director at BlackRock, Jeffrey Gary, CPA, Managing Director at BlackRock, Mark J. Williams, Managing Director at BlackRock, Kevin J. Booth, CFA, Managing Director at BlackRock and James E. Keenan, CFA, Director at BlackRock. Each is a member of BlackRock’s fixed income portfolio management group. Messrs. Kapito, Lustig and Williams are responsible for setting overall investment strategy and overseeing management of the Fund. Mr. Gary is responsible for setting the Fund’s overall credit strategy. Messrs. Booth and Keenan are the Fund’s co-portfolio managers and are responsible for the day-to-day management of the Fund’s portfolio and the selection of its

investments. Messrs. Kapito, Lustig and Williams have been members of the Fund’s management team since 2002. Mr. Gary has been a member of the Fund’s management team since 2006. Messrs. Booth and Keenan have been the Fund’s co-portfolio managers since 2007.

Robert S. Kapito is head of Portfolio Management and a member of the Executive and Management Committees and Investment Strategy Groups. Mr. Kapito oversees all portfolio management within BlackRock, including the Fixed Income, Equity, Liquidity, and Alternative Investment Groups. Mr. Kapito has been a portfolio manager with BlackRock since 1988.

Jeffrey Gary is the head of BlackRock’s high yield team within the Fixed Income Portfolio Management Group. Prior to joining BlackRock in 2003, Mr. Gary was a Managing Director and portfolio manager with AIG (American General) Investment Group.

Mark Williams is the head of BlackRock’s bank loan group and a member of the Investment Strategy Group. His primary responsibility is originating and evaluating bank loan investments for the firm's collateralized bond obligations. He is also involved in the evaluation and sourcing of mezzanine investments. Mr. Williams has been a portfolio manager with BlackRock since 1998.

Kevin Booth is co-head of the high yield team within BlackRock’s Fixed Income Portfolio Management Group. His primary responsibilities are managing portfolios and directing investment strategy. He specializes in hybrid high yield portfolios, consisting of leveraged bank loans, high yield bonds, and distressed obligations. Prior to joining BlackRock, Mr. Booth was a Managing Director (Global Fixed Income) of Merrill Lynch Investment Managers (“MLIM”) in 2006, a Director from 1998 to 2006 and was a Vice President of MLIM from 1991 to 1998. He has been a portfolio manager with BlackRock or MLIM since 1992, and was a member of MLIM’s bank loan group from 2000 to 2006.

James Keenan is a high yield portfolio manager and trader within BlackRock’s Fixed Income Portfolio Management Group. His primary responsibilities are managing client portfolios, executing trades and ensuring consistency across high yield portfolios. Mr. Keenan has been with BlackRock since 2004. Prior to joining BlackRock, he was a senior high yield trader at Columbia Management Group. Mr. Keenan began his investment career at UBS Global Asset Management where he held roles as a trader, research analyst and a portfolio analyst from 1998 through 2003.

(a)(2) As of October 31, 2007:

				(iii) Number of Other Accounts and
	(ii) Number of Other Accounts Managed			Assets for Which Advisory Fee is
	and Assets by Account Type			Performance-Based
	Other			Other
(i) Name of	Registered	Other Pooled		Registered	Other Pooled
Portfolio	Investment	Investment	Other	Investment	Investment	Other
Manager	Companies	Vehicles	Accounts	Companies	Vehicles	Accounts
Robert Kapito	4	1	1	0	1	0
	$1,308,867,234	$771,998,104	$6,385,960	$0	$771,198,104	$0

Michael Lustig	4	1	4	0	1	0
	$1,308,867,234	$771,998,104	$4,209,857,310	$0	$771,198,104	$0
Jeffrey Gary	17	12	17	0	5	5
	$8,687,556,648	$3,521,329,269	$7,450,262,711	$0	$2,134,982,068	$929,839,511
Mark Williams	9	17	2	0	11	1
	$4,494,529,079	$5,624,729,433	$180,860,442	$0	$4,255,521,628	$27,911,281
Kevin Booth	23	9	7	0	3	3
	$11,545,222,168	$2,807,991,314	$1,342,876,998	$0	$983,503,746	$597,096,279
James Keenan	17	9	16	0	2	5
	$8,687,556,548	$2,533,806,875	$3,031,198,440	$0	$1,211,076,381	$780,980,221

(iv) Potential Material Conflicts of Interest 

BlackRock, Inc. and its affiliates (collectively, herein “BlackRock”) has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition, BlackRock, its affiliates and any officer, director, stockholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or any of its affiliates, or any officer, director, stockholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock’s (or its affiliates’) officers, directors or employees are directors or officers, or companies as to which BlackRock or any of its affiliates or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information. Each portfolio manager also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for the Fund. In this connection, it should be noted that certain portfolio managers currently manage certain accounts that are subject to performance fees. In addition, certain portfolio managers assist in managing certain hedge funds and may be entitled to receive a portion of any incentive fees earned on such funds and a portion of such incentive fees may be voluntarily or involuntarily deferred. Additional portfolio managers may in the future manage other such accounts or funds and may be entitled to receive incentive fees.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment. To this end, BlackRock has adopted a policy that is intended to ensure that investment opportunities are allocated fairly and equitably among client accounts over time. This policy also seeks to achieve reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base.

	(a)(3) As of October 31, 2007:
Portfolio Manager Compensation
	The portfolio manager compensation program of BlackRock is critical to BlackRock’s ability to attract and retain the most talented asset management professionals. This program ensures that compensation is aligned with maximizing investment returns and it provides a competitive pay opportunity for competitive performance.
	Compensation Program
	The elements of total compensation for BlackRock portfolio managers are: fixed base salary, annual performance-based cash and stock compensation (cash and stock bonus) and other benefits. BlackRock has balanced these components of pay to provide portfolio managers with a powerful incentive to achieve consistently superior investment performance. By design, portfolio manager compensation levels fluctuate — both up and down — with the relative investment performance of the portfolios that they manage.
	Base Salary
	Under the BlackRock approach, like that of many asset management firms, fixed base salaries represent a relatively small portion of a portfolio manager’s total compensation. This approach serves to enhance the motivational value of the performance-based (and therefore variable) compensation elements of the compensation program.
	Performance-Based Compensation
	BlackRock believes that the best interests of investors are served by recruiting and retaining exceptional asset management talent and managing their compensation within a consistent and disciplined framework that emphasizes pay for performance in the context of an intensely competitive market for talent. To that end, the portfolio manager incentive compensation is based on a formulaic compensation program.
	BlackRock’s formulaic portfolio manager compensation program includes: pre-tax investment performance relative to the appropriate competitors or benchmarks over 1-, 3- and 5-year performance periods and a measure of operational efficiency. If a portfolio manager’s tenure is less than 5 years, performance periods will reflect time in position. Portfolio managers are compensated based on products they manage. For these purposes, the performance of the Fund is compared to the Lipper Closed-end General Bond Funds classification, the Lehman Brothers High Yield Index and the Lehman Brothers Credit Index. A smaller discretionary element of portfolio manager compensation may include consideration of: financial results, expense control, profit margins, strategic planning and implementation, quality of client service, market share, corporate reputation, capital allocation, compliance and risk control, leadership, workforce diversity, supervision, technology and innovation. All factors are considered collectively by BlackRock management.

	Cash Bonus
	Performance-based compensation is distributed to portfolio managers in a combination of cash and stock. Typically, the cash bonus, when combined with base salary, represents more than 60% of total compensation for the portfolio managers.
	Stock Bonus
	A portion of the dollar value of the total annual performance-based bonus is paid in restricted shares of stock of BlackRock, Inc. (the “Company”). Paying a portion of annual bonuses in stock puts compensation earned by a portfolio manager for a given year “at risk” based on the Company’s ability to sustain and improve its performance over future periods. The ultimate value of stock bonuses is dependent on future Company stock price performance. As such, the stock bonus aligns each portfolio manager’s financial interests with those of the Company’s shareholders and encourages a balance between short-term goals and long-term strategic objectives. Management strongly believes that providing a significant portion of competitive performance-based compensation in stock is in the best interests of investors and shareholders. This approach ensures that portfolio managers participate as shareholders in both the “downside risk” and “upside opportunity” of the Company’s performance. Portfolio managers, therefore, have a direct incentive to protect the Company’s reputation for integrity.
	Other Benefits
	Portfolio managers are also eligible to participate in broad-based plans offered generally to BlackRock employees, including broad-based retirement, 401(k), health, and other employee benefit plans. For example, BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP) and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 6% of eligible pay contributed to the plan capped at $4,000 per year, and a company retirement contribution equal to 3% of eligible compensation, plus an additional contribution of 2% for any year in which BlackRock has positive net operating income. The RSP offers a range of investment options, including registered investment companies managed by the firm. Company contributions follow the investment direction set by participants for their own contributions or absent, employee investment direction, are invested into a stable value fund. The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares or a dollar value of $25,000. Each portfolio manager is eligible to participate in these plans.
	(a)(4)	Beneficial Ownership of Securities. As of October 31, 2007, none of Messrs. Lustig, Williams, Gary, Keenan or Booth beneficially owned any stock issued by the Fund. As of October 31, 2007, Mr. Kapito beneficially owned stock issued by the Fund in the range of $10,001 to $50,000.
Item 9 –	Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable due to no such purchases during the period covered by this report.

Item 10 –	Submission of Matters to a Vote of Security Holders – The registrant’s Nominating and Governance Committee will consider nominees to the Board recommended by shareholders when a vacancy becomes available. Shareholders who wish to recommend a nominee should send nominations which include biographical information and set forth the qualifications of the proposed nominee to the registrant’s Secretary. There have been no material changes to these procedures.
Item 11 –	Controls and Procedures
11(a) –	The registrant’s principal executive and principal financial officers or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective asof a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities and Exchange Act of 1934, as amended.
11(b) –	There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12 –	Exhibits attached hereto
12(a)(1) –	Code of Ethics – See Item 2
12(a)(2) –	Certifications – Attached hereto
12(a)(3) –	Not Applicable
12(b) –	Certifications – Attached hereto

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BlackRock Strategic Bond Trust
By:	/s/ Donald C. Burke
	Donald C. Burke,
	Chief Executive Officer of
	BlackRock Strategic Bond Trust
Date: December 19, 2007

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Donald C. Burke
	Donald C. Burke,
	Chief Executive Officer (principal executive officer) of
	BlackRock Strategic Bond Trust

Date: December 19, 2007

By:	/s/ Neal J. Andrews
	Neal J. Andrews,
	Chief Financial Officer (principal financial officer) of
	BlackRock Strategic Bond Trust

Date: December 19, 2007