This 9% Yielder Gives You Databricks, Anthropic, And ByteDance At A 12% Discount
But 38% In Private Holdings Means You're Trusting BlackRock's Marks
Every week, we'll profile a high yield investment fund that typically offers an annualized distribution of 6-10% or more. With the S&P 500 yielding less than 2%, many investors find it difficult to achieve the portfolio income necessary to meet their needs and goals. This report is designed to help address those concerns.
The AI trade has gone through a fascinating evolution over the past 18 months. First it was NVIDIA. Then it broadened to the hyperscalers. Then it was "picks and shovels" — semiconductor equipment, data center REITs, and power utilities. But there's one layer of the AI ecosystem that remains almost entirely inaccessible to retail investors: the private companies building the foundational models and enterprise infrastructure. Databricks at a $134 billion valuation. Anthropic valued at $380 billion after its February 2026 Series G raise. ByteDance generating $50 billion in annual profit at a reported $550 billion private valuation. These are some of the most important technology companies on the planet, and you can't buy a single share on the open market.
Unless, of course, you buy a closed-end fund that already owns them. The BlackRock Science and Technology Term Trust (BSTZ) is one of the only vehicles on any exchange that gives retail investors direct exposure to the private AI ecosystem. BSTZ currently yields approximately 9.0% through monthly distributions of $0.1625 per share, trades at a nearly 12% discount to net asset value, and holds 38.5% of its $1.7 billion portfolio in 20 private companies — including Databricks as its single largest position at 17.4% of net assets. That's a remarkable setup for income-oriented investors who also want growth exposure to the most valuable private technology companies in the world.BlackRock Science and Technology Term Trust (BSTZ)
Fund Background
BSTZ's investment objective is to provide total return and income primarily through long-term capital appreciation. The trust invests at least 80% of its total assets in equity securities issued by U.S. and non-U.S. science and technology companies across any market capitalization range, selected for rapid and sustainable growth potential. Managed by Tony Kim and Reid Menge at BlackRock, the portfolio spans 83 holdings across public and private markets.
What makes BSTZ truly distinctive isn't just the public tech exposure — NVIDIA at 8.25%, Lumentum at 3.94%, Tower Semiconductor at 2.70% — but the 38.5% private equity allocation. This is $662 million spread across 20 private holdings, with Databricks alone representing 17.4% of net assets. PsiQuantum (quantum computing) at 6.45%, GrubMarket (supply chain AI) at 2.76%, and Anthropic (frontier AI models) at 2.34% round out the top private names. No ETF, no mutual fund, and very few CEFs give retail investors this kind of direct private market access.
Key Fund Facts
The term-trust structure is critical. BSTZ has a June 26, 2031 termination date, at which point the fund must return NAV to shareholders. This creates a structural pull toward NAV convergence as the term date approaches and limits the discount from becoming permanently wide. BlackRock's Discount Management Program adds another layer: if the fund's average discount exceeds -10%, the board can initiate tender offers. The 2025 average discount was -7.8%, just below the trigger.
