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 811-09729
iShares Trust
(Exact name of registrant as specified in charter)
c/o: State Street Bank and Trust Company
100 Summer Street, 4th Floor, Boston, MA 02110
(Address of principal executive offices) (Zip code)
The Corporation Trust Company
1209 Orange Street, Wilmington, DE 19801
(Name and address of agent for service)
Registrant’s telephone number, including area code: (415) 670-2000
Date of fiscal year end: April 30, 2021
Date of reporting period: October 31, 2020
| Item 1. |
Reports to Stockholders. |
Copies of the semi-annual reports transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 are attached.
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OCTOBER 31, 2020 |
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2020 Semi-Annual Report (Unaudited)
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iShares Trust
| · |
iShares Dow Jones U.S. ETF | IYY | NYSE Arca |
| · |
iShares Transportation Average ETF | IYT | Cboe BZX |
| · |
iShares U.S. Energy ETF | IYE | NYSE Arca |
| · |
iShares U.S. Healthcare ETF | IYH | NYSE Arca |
| · |
iShares U.S. Technology ETF | IYW | NYSE Arca |
| · |
iShares U.S. Utilities ETF | IDU | NYSE Arca |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.
Dear Shareholder,
The 12-month reporting period as of October 31, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus (or “COVID-19”) led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered solid returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.
After markets hit their lowest point of the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which declined marginally during the reporting period. International equities from developed economies declined, significantly lagging emerging market stocks, which rebounded sharply.
During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.
The Fed took an accommodative monetary stance in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted two emergency interest rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.
Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.
Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring emerging market stocks and tilting toward the quality factor for its resilience.
In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.
Sincerely,
Rob Kapito
President, BlackRock, Inc.
Rob Kapito
President, BlackRock, Inc.
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Total Returns as of October 31, 2020
|
||||||||
| 6-Month | 12-Month | |||||||
|
U.S. large cap equities
|
13.29 | % | 9.71 | % | ||||
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U.S. small cap equities
|
18.13 | (0.14 | ) | |||||
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International equities
|
8.57 | (6.86 | ) | |||||
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Emerging market equities
|
20.96 | 8.25 | ||||||
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3-month Treasury
bills
|
0.06 | 0.92 | ||||||
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U.S. Treasury securities
|
(1.63 | ) | 8.92 | |||||
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U.S. investment grade bonds
|
1.27 | 6.19 | ||||||
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Tax-exempt municipal
bonds
|
4.87 | 3.55 | ||||||
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U.S. high yield bonds
|
10.73 | 3.42 | ||||||
| Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index. |
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| 2 |
T H I S P A G E I S N O T P A R T O F Y O U R F U N D R E P O R T |
| Page | ||
| 2 | ||
| 4 | ||
| 10 | ||
| 10 | ||
| 11 | ||
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Financial Statements |
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| 38 | ||
| 40 | ||
| 42 | ||
| 45 | ||
| 51 | ||
| 60 | ||
| 66 | ||
| 67 | ||
| 68 | ||
| Fund Summary as of October 31, 2020 | iShares® Dow Jones U.S. ETF |
Investment Objective
The iShares Dow Jones U.S. ETF (the “Fund”) seeks to track the investment results of a broad-based index composed of U.S. equities, as represented by the Dow Jones U.S. IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index.Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
14.70 | % | 10.07 | % | 11.38 | % | 12.66 | % | 10.07 | % | 71.38 | % | 229.29 | % | ||||||||||||||||
|
Fund Market |
14.74 | 10.04 | 11.38 | 12.65 | 10.04 | 71.38 | 229.11 | |||||||||||||||||||||||
|
Index |
14.81 | 10.29 | 11.59 | 12.87 | 10.29 | 73.03 | 235.61 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
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|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 1,147.00 | $ 1.08 | $ 1,000.00 | $ 1,024.20 | $ 1.02 | 0.20 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Information Technology |
27.4% | |
|
Health Care |
13.9 | |
|
Consumer Discretionary |
12.2 | |
|
Communication Services |
10.6 | |
|
Financials |
10.0 | |
|
Industrials |
8.7 | |
|
Consumer Staples |
6.4 | |
|
Utilities |
3.1 | |
|
Real Estate |
3.1 | |
|
Materials |
2.7 | |
|
Energy |
1.9 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
Apple Inc. |
5.6% | |
|
Microsoft Corp. |
4.9 | |
|
Amazon.com Inc. |
4.2 | |
|
Facebook Inc., Class A |
2.0 | |
|
Alphabet Inc., Class A |
1.6 | |
|
Alphabet Inc., Class C |
1.5 | |
|
Berkshire Hathaway Inc., Class B |
1.3 | |
|
Johnson & Johnson |
1.2 | |
|
Procter & Gamble Co. (The) |
1.1 | |
|
NVIDIA Corp. |
1.0 | |
| (a) |
Excludes money market funds. |
| 4 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Transportation Average ETF |
Investment Objective
The iShares Transportation Average ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the transportation sector, as represented by the Dow Jones Transportation Average IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
31.84 | %(a) | 5.67 | % | 7.41 | % | 9.91 | % | 5.67 | % | 42.98 | % | 157.34 | % | ||||||||||||||||
|
Fund Market |
31.80 | 5.65 | 7.42 | 9.91 | 5.65 | 43.00 | 157.33 | |||||||||||||||||||||||
|
Index |
33.64 | 7.45 | 8.08 | 10.51 | 7.45 | 47.49 | 171.61 | |||||||||||||||||||||||
| (a) |
The NAV total return presented in the table for the six-months period differs from the same period return disclosed in the financial highlights. The total return in the financial highlights is calculated in the same manner but differs due to certain adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles. |
Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 1,318.40 | $ 2.45 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Road & Rail |
49.7% | |
|
Air Freight & Logistics |
27.4 | |
|
Airlines |
17.5 | |
|
Marine |
5.4 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
FedEx Corp. |
13.2% | |
|
Norfolk Southern Corp. |
10.4 | |
|
Union Pacific Corp. |
8.7 | |
|
Kansas City Southern |
8.7 | |
|
Landstar System Inc. |
6.2 | |
|
CSX Corp. |
4.9 | |
|
United Parcel Service Inc., Class B |
4.8 | |
|
CH Robinson Worldwide Inc. |
4.7 | |
|
Expeditors International of Washington Inc. |
4.7 | |
|
JB Hunt Transport Services Inc. |
4.7 | |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
5 |
| Fund Summary as of October 31, 2020 | iShares® U.S. Energy ETF |
Investment Objective
The iShares U.S. Energy ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the energy sector, as represented by the Dow Jones U.S. Oil & Gas IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
(21.22 | )% | (46.01 | )% | (13.37 | )% | (4.96 | )% | (46.01 | )% | (51.21 | )% | (39.89 | )% | ||||||||||||||||
|
Fund Market |
(21.12 | ) | (46.04 | ) | (13.39 | ) | (4.97 | ) | (46.04 | ) | (51.28 | ) | (39.93 | ) | ||||||||||||||||
|
Index |
(21.10 | ) | (45.82 | ) | (13.02 | ) | (4.59 | ) | (45.82 | ) | (50.22 | ) | (37.48 | ) | ||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 787.80 | $ 1.89 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Oil, Gas & Consumable Fuels |
89.7% | |
|
Energy Equipment & Services |
7.9 | |
|
Semiconductors & Semiconductor Equipment |
1.3 | |
|
Electric Utilities |
1.1 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
Exxon Mobil Corp. |
23.3% | |
|
Chevron Corp. |
22.6 | |
|
ConocoPhillips |
4.7 | |
|
Williams Companies Inc. (The) |
3.9 | |
|
Kinder Morgan Inc./DE |
3.9 | |
|
Schlumberger Ltd. |
3.5 | |
|
Phillips 66 |
3.5 | |
|
EOG Resources Inc. |
3.4 | |
|
Marathon Petroleum Corp. |
3.3 | |
|
Valero Energy Corp. |
2.7 | |
| (a) |
Excludes money market funds. |
| 6 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® U.S. Healthcare ETF |
Investment Objective
The iShares U.S. Healthcare ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the healthcare sector, as represented by the Dow Jones U.S. Health Care IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
4.10 | % | 12.33 | % | 9.63 | % | 14.76 | % | 12.33 | % | 58.39 | % | 296.29 | % | ||||||||||||||||
|
Fund Market |
4.11 | 12.27 | 9.64 | 14.76 | 12.27 | 58.42 | 296.07 | |||||||||||||||||||||||
|
Index |
4.32 | 12.80 | 10.06 | 15.24 | 12.80 | 61.52 | 313.13 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 1,041.00 | $ 2.16 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Health Care Equipment & Supplies |
27.9% | |
|
Pharmaceuticals |
26.8 | |
|
Health Care Providers & Services |
18.1 | |
|
Biotechnology |
17.0 | |
|
Life Sciences Tools & Services |
9.7 | |
|
Health Care Technology |
0.5 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
Johnson & Johnson |
8.6% | |
|
UnitedHealth Group Inc. |
6.9 | |
|
Pfizer Inc. |
4.7 | |
|
Merck & Co. Inc. |
4.5 | |
|
Thermo Fisher Scientific Inc. |
4.4 | |
|
Abbott Laboratories |
4.4 | |
|
AbbVie Inc. |
3.6 | |
|
Danaher Corp. |
3.4 | |
|
Medtronic PLC |
3.2 | |
|
Bristol-Myers Squibb Co. |
3.1 | |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
7 |
| Fund Summary as of October 31, 2020 | iShares® U.S. Technology ETF |
Investment Objective
The iShares U.S. Technology ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the technology sector, as represented by the Dow Jones U.S. Technology Capped (TR) IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
25.25 | % | 39.15 | % | 22.95 | % | 17.98 | % | 39.15 | % | 180.99 | % | 422.61 | % | ||||||||||||||||
|
Fund Market |
25.40 | 39.22 | 22.97 | 17.98 | 39.22 | 181.16 | 422.71 | |||||||||||||||||||||||
|
Index |
25.51 | 39.74 | 23.50 | 18.46 | 39.74 | 187.30 | 443.95 | |||||||||||||||||||||||
Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.
Index performance through June 23, 2019 reflects the performance of the Dow Jones U.S. Technology Total Return Index. Index performance beginning on June 24, 2019 reflects the performance of the Dow Jones U.S. Technology Capped (TR) IndexTM.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 1,252.50 | $ 2.38 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Software |
36.7% | |
|
Technology Hardware, Storage & Peripherals |
20.9 | |
|
Semiconductors & Semiconductor Equipment |
19.8 | |
|
Interactive Media & Services |
12.9 | |
|
IT Services |
4.5 | |
|
Communications Equipment |
2.9 | |
|
Other (each representing less than 1%) |
2.3 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
Apple Inc. |
19.8% | |
|
Microsoft Corp. |
17.3 | |
|
Facebook Inc., Class A |
4.4 | |
|
NVIDIA Corp. |
4.0 | |
|
Alphabet Inc., Class A |
3.5 | |
|
Alphabet Inc., Class C |
3.4 | |
|
Adobe Inc. |
2.8 | |
|
salesforce.com Inc. |
2.7 | |
|
Intel Corp. |
2.4 | |
|
Cisco Systems Inc. |
2.0 | |
| (a) |
Excludes money market funds. |
| 8 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® U.S. Utilities ETF |
Investment Objective
The iShares U.S. Utilities ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the utilities sector, as represented by the Dow Jones U.S. Utilities IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||
|
Fund NAV |
9.05 | % | (2.36 | )% | 10.20 | % | 10.58 | % | (2.36 | )% | 62.55 | % | 173.37 | % | ||||||||||||||||
|
Fund Market |
9.06 | (2.37 | ) | 10.21 | 10.58 | (2.37 | ) | 62.57 | 173.33 | |||||||||||||||||||||
|
Index |
9.28 | (1.93 | ) | 10.70 | 11.08 | (1.93 | ) | 66.26 | 185.95 | |||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 10 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ 1,090.50 | $ 2.21 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | ||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 10 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|
|
Electric Utilities |
60.4% | |
|
Multi-Utilities |
29.9 | |
|
Water Utilities |
3.8 | |
|
Gas Utilities |
3.6 | |
|
Independent Power and Renewable Electricity Producers |
2.3 | |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|
|
NextEra Energy Inc. |
15.0% | |
|
Duke Energy Corp. |
7.1 | |
|
Dominion Energy Inc. |
7.0 | |
|
Southern Co. (The) |
6.3 | |
|
American Electric Power Co. Inc. |
4.6 | |
|
Exelon Corp. |
4.0 | |
|
Xcel Energy Inc. |
3.8 | |
|
Sempra Energy |
3.8 | |
|
WEC Energy Group Inc. |
3.3 | |
|
Eversource Energy |
3.1 | |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
9 |
Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.
Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.
An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.
As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses – The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes – The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| 10 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
|
Aerospace & Defense — 1.4% |
||||||||
|
Axon Enterprise Inc.(a)(b) |
2,596 | $ | 256,744 | |||||
|
Boeing Co. (The) |
21,205 | 3,061,790 | ||||||
|
BWX Technologies Inc. |
3,785 | 208,213 | ||||||
|
Curtiss-Wright Corp. |
1,684 | 142,062 | ||||||
|
General Dynamics Corp. |
9,302 | 1,221,632 | ||||||
|
HEICO Corp. |
1,711 | 179,741 | ||||||
|
HEICO Corp., Class A |
2,961 | 276,853 | ||||||
|
Hexcel Corp. |
3,436 | 115,037 | ||||||
|
Howmet Aerospace Inc. |
15,439 | 266,323 | ||||||
|
Huntington Ingalls Industries Inc. |
1,646 | 242,752 | ||||||
|
L3Harris Technologies Inc. |
8,624 | 1,389,413 | ||||||
|
Lockheed Martin Corp. |
9,832 | 3,442,478 | ||||||
|
Mercury Systems Inc.(a) |
2,221 | 152,982 | ||||||
|
Northrop Grumman Corp. |
6,185 | 1,792,537 | ||||||
|
Raytheon Technologies Corp. |
61,054 | 3,316,453 | ||||||
|
Teledyne Technologies Inc.(a) |
1,468 | 453,832 | ||||||
|
Textron Inc. |
9,147 | 327,463 | ||||||
|
TransDigm Group Inc. |
2,176 | 1,038,844 | ||||||
|
|
|
|||||||
| 17,885,149 | ||||||||
| Air Freight & Logistics — 0.7% | ||||||||
|
CH Robinson Worldwide Inc. |
5,385 | 476,196 | ||||||
|
Expeditors International of Washington Inc. |
6,757 | 597,116 | ||||||
|
FedEx Corp. |
9,633 | 2,499,475 | ||||||
|
United Parcel Service Inc., Class B |
28,259 | 4,439,771 | ||||||
|
XPO Logistics Inc.(a) |
3,670 | 330,300 | ||||||
|
|
|
|||||||
| 8,342,858 | ||||||||
| Airlines — 0.2% | ||||||||
|
Alaska Air Group Inc. |
5,029 | 190,549 | ||||||
|
American Airlines Group Inc. |
20,652 | 232,955 | ||||||
|
Delta Air Lines Inc. |
25,602 | 784,445 | ||||||
|
JetBlue Airways Corp.(a) |
10,864 | 130,042 | ||||||
|
Southwest Airlines Co. |
23,676 | 935,912 | ||||||
|
United Airlines Holdings Inc.(a) |
11,680 | 395,485 | ||||||
|
|
|
|||||||
| 2,669,388 | ||||||||
| Auto Components — 0.2% | ||||||||
|
Aptiv PLC |
10,804 | 1,042,478 | ||||||
|
Autoliv Inc. |
3,145 | 238,391 | ||||||
|
BorgWarner Inc. |
9,701 | 339,341 | ||||||
|
Gentex Corp. |
9,752 | 269,838 | ||||||
|
Lear Corp. |
2,224 | 268,681 | ||||||
|
|
|
|||||||
| 2,158,729 | ||||||||
| Automobiles — 1.2% | ||||||||
|
Ford Motor Co. |
156,449 | 1,209,351 | ||||||
|
General Motors Co. |
50,444 | 1,741,832 | ||||||
|
Harley-Davidson Inc. |
6,248 | 205,434 | ||||||
|
Tesla Inc.(a) |
29,827 | 11,574,069 | ||||||
|
Thor Industries Inc.(b) |
2,176 | 184,046 | ||||||
|
|
|
|||||||
| 14,914,732 | ||||||||
| Banks — 3.3% | ||||||||
|
Bank of America Corp. |
305,244 | 7,234,283 | ||||||
|
Bank OZK |
4,989 | 123,627 | ||||||
|
BOK Financial Corp. |
1,258 | 73,895 | ||||||
|
Citigroup Inc. |
83,203 | 3,446,268 | ||||||
|
Citizens Financial Group Inc. |
16,956 | 462,051 | ||||||
|
Comerica Inc. |
5,463 | 248,621 | ||||||
|
Commerce Bancshares Inc. |
3,984 | 248,004 | ||||||
|
Cullen/Frost Bankers Inc. |
2,286 | 160,637 | ||||||
| Security | Shares | Value | ||||||
| Banks (continued) | ||||||||
|
East West Bancorp. Inc. |
5,815 | $ | 212,131 | |||||
|
Fifth Third Bancorp. |
28,442 | 660,423 | ||||||
|
First Citizens BancShares Inc./NC, Class A |
290 | 134,183 | ||||||
|
First Financial Bankshares Inc. |
5,566 | 165,923 | ||||||
|
First Horizon National Corp. |
22,223 | 231,342 | ||||||
|
First Republic Bank/CA |
6,908 | 871,375 | ||||||
|
FNB Corp. |
13,125 | 99,225 | ||||||
|
Glacier Bancorp. Inc. |
3,908 | 139,906 | ||||||
|
Home BancShares Inc./AR |
6,167 | 102,372 | ||||||
|
Huntington Bancshares Inc./OH |
41,148 | 429,585 | ||||||
|
JPMorgan Chase & Co. |
121,942 | 11,955,194 | ||||||
|
KeyCorp. |
39,476 | 512,399 | ||||||
|
M&T Bank Corp. |
5,166 | 535,094 | ||||||
|
People’s United Financial Inc. |
16,524 | 176,311 | ||||||
|
Pinnacle Financial Partners Inc. |
3,170 | 145,154 | ||||||
|
PNC Financial Services Group Inc. (The) |
16,965 | 1,898,044 | ||||||
|
Popular Inc. |
3,216 | 135,715 | ||||||
|
Prosperity Bancshares Inc. |
3,792 | 208,977 | ||||||
|
Regions Financial Corp. |
38,659 | 514,165 | ||||||
|
Signature Bank/New York NY |
2,157 | 174,156 | ||||||
|
SVB Financial Group(a) |
2,079 | 604,365 | ||||||
|
Synovus Financial Corp. |
5,850 | 152,100 | ||||||
|
TCF Financial Corp. |
6,114 | 166,362 | ||||||
|
Truist Financial Corp. |
53,858 | 2,268,499 | ||||||
|
U.S. Bancorp. |
54,784 | 2,133,837 | ||||||
|
UMB Financial Corp. |
1,719 | 104,636 | ||||||
|
Umpqua Holdings Corp. |
8,827 | 110,867 | ||||||
|
United Bankshares Inc./WV |
5,091 | 133,537 | ||||||
|
Valley National Bancorp. |
15,717 | 120,078 | ||||||
|
Webster Financial Corp. |
3,683 | 118,630 | ||||||
|
Wells Fargo & Co. |
164,660 | 3,531,957 | ||||||
|
Western Alliance Bancorp. |
4,190 | 172,628 | ||||||
|
Wintrust Financial Corp. |
2,306 | 113,524 | ||||||
|
Zions Bancorp NA |
6,425 | 207,335 | ||||||
|
|
|
|||||||
| 41,237,415 | ||||||||
| Beverages — 1.5% | ||||||||
|
Boston Beer Co. Inc. (The), Class A, NVS(a) |
366 | 380,340 | ||||||
|
Brown-Forman Corp., Class B, NVS |
7,298 | 508,743 | ||||||
|
Coca-Cola Co. (The) |
154,762 | 7,437,862 | ||||||
|
Constellation Brands Inc., Class A |
6,740 | 1,113,650 | ||||||
|
Keurig Dr Pepper Inc. |
18,651 | 501,712 | ||||||
|
Molson Coors Beverage Co., Class B |
7,510 | 264,803 | ||||||
|
Monster Beverage Corp.(a) |
14,818 | 1,134,614 | ||||||
|
National Beverage Corp.(a)(b) |
479 | 37,501 | ||||||
|
PepsiCo Inc. |
55,430 | 7,388,265 | ||||||
|
|
|
|||||||
| 18,767,490 | ||||||||
| Biotechnology — 2.3% | ||||||||
|
AbbVie Inc. |
70,687 | 6,015,464 | ||||||
|
ACADIA Pharmaceuticals Inc.(a) |
4,513 | 209,629 | ||||||
|
Acceleron Pharma Inc.(a) |
2,091 | 218,677 | ||||||
|
Agios Pharmaceuticals Inc.(a) |
2,371 | 95,006 | ||||||
|
Alexion Pharmaceuticals Inc.(a) |
8,797 | 1,012,887 | ||||||
|
Alkermes PLC(a) |
6,116 | 99,385 | ||||||
|
Allogene Therapeutics Inc.(a) |
2,522 | 85,546 | ||||||
|
Alnylam Pharmaceuticals Inc.(a) |
4,655 | 572,425 | ||||||
|
Amgen Inc. |
23,408 | 5,078,132 | ||||||
|
Biogen Inc.(a) |
6,359 | 1,602,913 | ||||||
|
BioMarin Pharmaceutical Inc.(a) |
7,215 | 537,012 | ||||||
|
Bluebird Bio Inc.(a)(b) |
2,564 | 132,584 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
11 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Biotechnology (continued) | ||||||||
|
Blueprint Medicines Corp.(a) |
2,170 | $ | 221,948 | |||||
|
Emergent BioSolutions Inc.(a) |
1,805 | 162,396 | ||||||
|
Exact Sciences Corp.(a) |
6,028 | 746,447 | ||||||
|
Exelixis Inc.(a) |
12,405 | 254,054 | ||||||
|
FibroGen Inc.(a) |
3,269 | 125,464 | ||||||
|
Gilead Sciences Inc. |
50,106 | 2,913,664 | ||||||
|
Incyte Corp.(a) |
7,461 | 646,421 | ||||||
|
Ionis Pharmaceuticals Inc.(a) |
5,607 | 263,249 | ||||||
|
Moderna Inc.(a) |
12,077 | 814,835 | ||||||
|
Neurocrine Biosciences Inc.(a) |
3,701 | 365,178 | ||||||
|
Novavax Inc.(a) |
2,263 | 182,647 | ||||||
|
Regeneron Pharmaceuticals Inc.(a) |
4,174 | 2,268,819 | ||||||
|
Sarepta Therapeutics Inc.(a) |
3,151 | 428,252 | ||||||
|
Seagen Inc.(a) |
4,889 | 815,485 | ||||||
|
Ultragenyx Pharmaceutical Inc.(a) |
2,260 | 227,130 | ||||||
|
United Therapeutics Corp.(a) |
1,759 | 236,111 | ||||||
|
Vertex Pharmaceuticals Inc.(a) |
10,397 | 2,166,319 | ||||||
|
Vir Biotechnology Inc.(a)(b) |
2,601 | 81,775 | ||||||
|
|
|
|||||||
| 28,579,854 | ||||||||
| Building Products — 0.5% | ||||||||
|
A O Smith Corp. |
5,502 | 284,398 | ||||||
|
Allegion PLC |
3,654 | 359,919 | ||||||
|
Armstrong World Industries Inc. |
1,980 | 118,602 | ||||||
|
Carrier Global Corp. |
32,498 | 1,085,108 | ||||||
|
Fortune Brands Home & Security Inc. |
5,584 | 451,578 | ||||||
|
Johnson Controls International PLC |
29,658 | 1,251,864 | ||||||
|
Lennox International Inc. |
1,384 | 375,978 | ||||||
|
Masco Corp. |
10,404 | 557,654 | ||||||
|
Owens Corning |
4,276 | 279,950 | ||||||
|
Trane Technologies PLC |
9,616 | 1,276,524 | ||||||
|
Trex Co. Inc.(a) |
4,626 | 321,692 | ||||||
|
|
|
|||||||
| 6,363,267 | ||||||||
| Capital Markets — 2.7% | ||||||||
|
Affiliated Managers Group Inc. |
1,916 | 144,409 | ||||||
|
Ameriprise Financial Inc. |
4,827 | 776,326 | ||||||
|
Apollo Global Management Inc. |
8,372 | 308,592 | ||||||
|
Ares Management Corp., Class A |
3,794 | 160,486 | ||||||
|
Bank of New York Mellon Corp. (The) |
32,457 | 1,115,223 | ||||||
|
BlackRock Inc.(c) |
5,668 | 3,396,322 | ||||||
|
Blackstone Group Inc. (The), Class A |
26,744 | 1,348,433 | ||||||
|
Carlyle Group Inc. (The) |
4,619 | 115,105 | ||||||
|
Cboe Global Markets Inc. |
4,413 | 358,733 | ||||||
|
Charles Schwab Corp. (The) |
59,374 | 2,440,865 | ||||||
|
CME Group Inc. |
14,370 | 2,165,846 | ||||||
|
Eaton Vance Corp., NVS |
4,732 | 282,926 | ||||||
|
FactSet Research Systems Inc. |
1,516 | 464,654 | ||||||
|
Federated Hermes Inc. |
3,935 | 94,047 | ||||||
|
Franklin Resources Inc. |
10,701 | 200,644 | ||||||
|
Goldman Sachs Group Inc. (The) |
13,746 | 2,598,544 | ||||||
|
Interactive Brokers Group Inc., Class A |
3,237 | 153,984 | ||||||
|
Intercontinental Exchange Inc. |
22,402 | 2,114,749 | ||||||
|
Invesco Ltd. |
15,413 | 202,064 | ||||||
|
Janus Henderson Group PLC |
5,820 | 141,426 | ||||||
|
KKR & Co. Inc. |
22,442 | 766,394 | ||||||
|
Lazard Ltd., Class A |
4,504 | 151,650 | ||||||
|
LPL Financial Holdings Inc. |
3,241 | 259,053 | ||||||
|
MarketAxess Holdings Inc. |
1,509 | 813,125 | ||||||
|
Moody’s Corp. |
6,469 | 1,700,700 | ||||||
|
Morgan Stanley |
57,081 | 2,748,450 | ||||||
| Security | Shares | Value | ||||||
| Capital Markets (continued) | ||||||||
|
Morningstar Inc. |
827 | $ | 157,444 | |||||
|
MSCI Inc. |
3,357 | 1,174,413 | ||||||
|
Nasdaq Inc. |
4,603 | 556,917 | ||||||
|
Northern Trust Corp. |
8,337 | 652,537 | ||||||
|
Raymond James Financial Inc. |
4,960 | 379,142 | ||||||
|
S&P Global Inc. |
9,632 | 3,108,535 | ||||||
|
SEI Investments Co. |
4,872 | 239,459 | ||||||
|
State Street Corp. |
14,175 | 834,908 | ||||||
|
Stifel Financial Corp. |
2,698 | 157,725 | ||||||
|
T Rowe Price Group Inc. |
9,065 | 1,148,173 | ||||||
|
Tradeweb Markets Inc., Class A |
3,643 | 198,471 | ||||||
|
Virtu Financial Inc., Class A |
2,969 | 63,477 | ||||||
|
|
|
|||||||
| 33,693,951 | ||||||||
| Chemicals — 1.8% | ||||||||
|
Air Products & Chemicals Inc. |
8,857 | 2,446,658 | ||||||
|
Albemarle Corp. |
4,266 | 397,634 | ||||||
|
Ashland Global Holdings Inc. |
2,185 | 152,447 | ||||||
|
Axalta Coating Systems Ltd.(a) |
8,300 | 208,413 | ||||||
|
Celanese Corp. |
4,728 | 536,675 | ||||||
|
CF Industries Holdings Inc. |
8,644 | 238,661 | ||||||
|
Chemours Co. (The) |
6,663 | 134,193 | ||||||
|
Corteva Inc. |
30,040 | 990,719 | ||||||
|
Dow Inc. |
29,542 | 1,343,866 | ||||||
|
DuPont de Nemours Inc. |
29,456 | 1,675,457 | ||||||
|
Eastman Chemical Co. |
5,406 | 437,021 | ||||||
|
Ecolab Inc. |
9,903 | 1,818,092 | ||||||
|
Element Solutions Inc.(a) |
8,264 | 96,854 | ||||||
|
FMC Corp. |
5,229 | 537,227 | ||||||
|
Huntsman Corp. |
8,202 | 199,227 | ||||||
|
Ingevity Corp.(a) |
1,724 | 94,613 | ||||||
|
International Flavors & Fragrances Inc. |
4,283 | 439,693 | ||||||
|
Linde PLC |
20,997 | 4,626,479 | ||||||
|
LyondellBasell Industries NV, Class A |
10,351 | 708,526 | ||||||
|
Mosaic Co. (The) |
14,018 | 259,333 | ||||||
|
NewMarket Corp. |
296 | 105,876 | ||||||
|
PPG Industries Inc. |
9,408 | 1,220,406 | ||||||
|
RPM International Inc. |
5,213 | 441,385 | ||||||
|
Scotts Miracle-Gro Co. (The) |
1,606 | 240,980 | ||||||
|
Sherwin-Williams Co. (The) |
3,271 | 2,250,383 | ||||||
|
Valvoline Inc. |
7,411 | 145,774 | ||||||
|
Westlake Chemical Corp. |
1,455 | 98,387 | ||||||
|
WR Grace & Co. |
2,541 | 110,508 | ||||||
|
|
|
|||||||
| 21,955,487 | ||||||||
| Commercial Services & Supplies — 0.5% | ||||||||
|
ADT Inc. |
6,590 | 43,428 | ||||||
|
Cimpress PLC(a) |
779 | 57,179 | ||||||
|
Cintas Corp. |
3,489 | 1,097,465 | ||||||
|
Clean Harbors Inc.(a) |
2,072 | 109,754 | ||||||
|
Copart Inc.(a) |
8,213 | 906,387 | ||||||
|
IAA Inc.(a) |
5,305 | 300,210 | ||||||
|
MSA Safety Inc. |
1,477 | 194,846 | ||||||
|
Republic Services Inc. |
8,359 | 737,013 | ||||||
|
Rollins Inc. |
5,920 | 342,472 | ||||||
|
Stericycle Inc.(a) |
3,708 | 231,008 | ||||||
|
Tetra Tech Inc. |
2,186 | 220,589 | ||||||
|
Waste Management Inc. |
15,577 | 1,680,914 | ||||||
|
|
|
|||||||
| 5,921,265 | ||||||||
| Communications Equipment — 0.7% | ||||||||
|
Arista Networks Inc.(a) |
2,185 | 456,446 | ||||||
| 12 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Communications Equipment (continued) | ||||||||
|
Ciena Corp.(a) |
6,218 | $ | 244,927 | |||||
|
Cisco Systems Inc. |
169,540 | 6,086,486 | ||||||
|
EchoStar Corp., Class A(a) |
1,842 | 42,661 | ||||||
|
F5 Networks Inc.(a) |
2,455 | 326,368 | ||||||
|
Juniper Networks Inc. |
13,412 | 264,485 | ||||||
|
Lumentum Holdings Inc.(a) |
2,956 | 244,432 | ||||||
|
Motorola Solutions Inc. |
6,784 | 1,072,279 | ||||||
|
Ubiquiti Inc.(b) |
307 | 56,982 | ||||||
|
Viavi Solutions Inc.(a) |
8,807 | 108,766 | ||||||
|
|
|
|||||||
| 8,903,832 | ||||||||
| Construction & Engineering — 0.1% | ||||||||
|
AECOM(a) |
6,555 | 293,926 | ||||||
|
EMCOR Group Inc. |
2,185 | 148,995 | ||||||
|
Jacobs Engineering Group Inc. |
5,242 | 497,990 | ||||||
|
MasTec Inc.(a)(b) |
2,391 | 118,689 | ||||||
|
Quanta Services Inc. |
5,584 | 348,609 | ||||||
|
Valmont Industries Inc. |
835 | 118,529 | ||||||
|
|
|
|||||||
| 1,526,738 | ||||||||
| Construction Materials — 0.1% | ||||||||
|
Eagle Materials Inc. |
1,651 | 140,748 | ||||||
|
Martin Marietta Materials Inc. |
2,498 | 665,342 | ||||||
|
Vulcan Materials Co. |
5,321 | 770,694 | ||||||
|
|
|
|||||||
| 1,576,784 | ||||||||
| Consumer Finance — 0.5% | ||||||||
|
Ally Financial Inc. |
14,723 | 392,810 | ||||||
|
American Express Co. |
26,050 | 2,376,802 | ||||||
|
Capital One Financial Corp. |
18,338 | 1,340,141 | ||||||
|
Credit Acceptance Corp.(a)(b) |
489 | 145,781 | ||||||
|
Discover Financial Services |
12,336 | 801,963 | ||||||
|
FirstCash Inc. |
1,752 | 91,174 | ||||||
|
Green Dot Corp., Class A(a) |
2,072 | 110,479 | ||||||
|
LendingTree Inc.(a)(b) |
307 | 99,342 | ||||||
|
OneMain Holdings Inc. |
2,943 | 102,681 | ||||||
|
Santander Consumer USA Holdings Inc. |
2,914 | 59,271 | ||||||
|
SLM Corp. |
15,108 | 138,842 | ||||||
|
Synchrony Financial |
21,633 | 541,258 | ||||||
|
|
|
|||||||
| 6,200,544 | ||||||||
| Containers & Packaging — 0.4% | ||||||||
|
Amcor PLC |
62,290 | 649,685 | ||||||
|
AptarGroup Inc. |
2,583 | 294,694 | ||||||
|
Avery Dennison Corp. |
3,319 | 459,316 | ||||||
|
Ball Corp. |
13,108 | 1,166,612 | ||||||
|
Berry Global Group Inc.(a) |
5,304 | 247,326 | ||||||
|
Crown Holdings Inc.(a) |
5,431 | 465,980 | ||||||
|
Graphic Packaging Holding Co. |
11,567 | 153,725 | ||||||
|
International Paper Co. |
15,855 | 693,656 | ||||||
|
Packaging Corp. of America |
3,764 | 430,940 | ||||||
|
Sealed Air Corp. |
6,108 | 241,816 | ||||||
|
Silgan Holdings Inc. |
3,279 | 112,962 | ||||||
|
Sonoco Products Co. |
3,900 | 190,671 | ||||||
|
Westrock Co. |
10,327 | 387,779 | ||||||
|
|
|
|||||||
| 5,495,162 | ||||||||
| Distributors — 0.1% | ||||||||
|
Genuine Parts Co. |
5,736 | 518,706 | ||||||
|
LKQ Corp.(a) |
11,237 | 359,472 | ||||||
|
Pool Corp. |
1,604 | 561,127 | ||||||
|
|
|
|||||||
| 1,439,305 | ||||||||
| Security | Shares | Value | ||||||
| Diversified Consumer Services — 0.1% | ||||||||
|
Bright Horizons Family Solutions Inc.(a) |
2,438 | $ | 385,326 | |||||
|
Chegg Inc.(a) |
4,989 | 366,392 | ||||||
|
frontdoor Inc.(a) |
3,373 | 133,638 | ||||||
|
Grand Canyon Education Inc.(a) |
1,935 | 151,646 | ||||||
|
H&R Block Inc. |
8,032 | 138,632 | ||||||
|
Service Corp. International |
7,024 | 325,282 | ||||||
|
Terminix Global Holdings Inc.(a)(b) |
5,351 | 251,979 | ||||||
|
|
|
|||||||
| 1,752,895 | ||||||||
| Diversified Financial Services — 1.3% | ||||||||
|
Berkshire Hathaway Inc., Class B(a) |
79,313 | 16,013,295 | ||||||
|
Equitable Holdings Inc. |
16,078 | 345,516 | ||||||
|
Jefferies Financial Group Inc. |
8,543 | 166,674 | ||||||
|
Voya Financial Inc. |
5,082 | 243,580 | ||||||
|
|
|
|||||||
| 16,769,065 | ||||||||
| Diversified Telecommunication Services — 1.5% | ||||||||
|
AT&T Inc. |
285,226 | 7,706,807 | ||||||
|
CenturyLink Inc. |
39,377 | 339,430 | ||||||
|
GCI Liberty Inc., Class A(a) |
4,067 | 330,362 | ||||||
|
Liberty Global PLC, Class A(a) |
5,707 | 108,319 | ||||||
|
Liberty Global PLC, Class C, NVS(a) |
14,887 | 277,791 | ||||||
|
Verizon Communications Inc. |
165,601 | 9,437,601 | ||||||
|
|
|
|||||||
| 18,200,310 | ||||||||
| Electric Utilities — 1.9% | ||||||||
|
ALLETE Inc. |
2,074 | 106,977 | ||||||
|
Alliant Energy Corp. |
10,048 | 555,453 | ||||||
|
American Electric Power Co. Inc. |
19,808 | 1,781,333 | ||||||
|
Avangrid Inc. |
2,194 | 108,252 | ||||||
|
Duke Energy Corp. |
29,392 | 2,707,297 | ||||||
|
Edison International |
15,223 | 853,097 | ||||||
|
Entergy Corp. |
7,978 | 807,533 | ||||||
|
Evergy Inc. |
9,132 | 504,086 | ||||||
|
Eversource Energy |
13,754 | 1,200,312 | ||||||
|
Exelon Corp. |
39,029 | 1,556,867 | ||||||
|
FirstEnergy Corp. |
21,654 | 643,557 | ||||||
|
Hawaiian Electric Industries Inc. |
4,477 | 147,920 | ||||||
|
IDACORP Inc. |
1,992 | 174,758 | ||||||
|
NextEra Energy Inc. |
78,444 | 5,742,885 | ||||||
|
NRG Energy Inc. |
9,733 | 307,758 | ||||||
|
OGE Energy Corp. |
7,970 | 245,237 | ||||||
|
PG&E Corp.(a) |
58,827 | 562,386 | ||||||
|
Pinnacle West Capital Corp. |
4,471 | 364,700 | ||||||
|
PNM Resources Inc. |
3,177 | 158,850 | ||||||
|
Portland General Electric Co. |
3,521 | 138,375 | ||||||
|
PPL Corp. |
30,835 | 847,963 | ||||||
|
Southern Co. (The) |
42,209 | 2,424,907 | ||||||
|
Xcel Energy Inc. |
21,033 | 1,472,941 | ||||||
|
|
|
|||||||
| 23,413,444 | ||||||||
| Electrical Equipment — 0.6% | ||||||||
|
Acuity Brands Inc. |
1,577 | 140,574 | ||||||
|
AMETEK Inc. |
9,137 | 897,253 | ||||||
|
Eaton Corp. PLC |
15,986 | 1,659,187 | ||||||
|
Emerson Electric Co. |
23,876 | 1,546,926 | ||||||
|
EnerSys |
1,632 | 116,851 | ||||||
|
Generac Holdings Inc.(a) |
2,536 | 532,940 | ||||||
|
Hubbell Inc. |
2,211 | 321,723 | ||||||
|
nVent Electric PLC |
6,820 | 123,101 | ||||||
|
Regal Beloit Corp. |
1,644 | 162,181 | ||||||
|
Rockwell Automation Inc. |
4,632 | 1,098,340 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
13 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Electrical Equipment (continued) | ||||||||
|
Sensata Technologies Holding PLC(a) |
6,144 | $ | 268,554 | |||||
|
|
|
|||||||
| 6,867,630 | ||||||||
| Electronic Equipment, Instruments & Components — 0.7% | ||||||||
|
Amphenol Corp., Class A |
11,958 | 1,349,341 | ||||||
|
Arrow Electronics Inc.(a) |
3,116 | 242,705 | ||||||
|
Avnet Inc. |
3,742 | 92,315 | ||||||
|
CDW Corp./DE |
5,691 | 697,717 | ||||||
|
Cognex Corp. |
6,910 | 455,369 | ||||||
|
Coherent Inc.(a) |
970 | 121,386 | ||||||
|
Corning Inc. |
30,542 | 976,428 | ||||||
|
Dolby Laboratories Inc., Class A |
2,562 | 192,355 | ||||||
|
FLIR Systems Inc. |
5,121 | 177,647 | ||||||
|
IPG Photonics Corp.(a) |
1,422 | 264,435 | ||||||
|
Itron Inc.(a) |
1,631 | 110,826 | ||||||
|
Jabil Inc. |
5,240 | 173,654 | ||||||
|
Keysight Technologies Inc.(a) |
7,485 | 784,952 | ||||||
|
Littelfuse Inc. |
978 | 193,585 | ||||||
|
National Instruments Corp. |
5,276 | 165,033 | ||||||
|
SYNNEX Corp. |
1,612 | 212,204 | ||||||
|
TE Connectivity Ltd. |
13,247 | 1,283,369 | ||||||
|
Trimble Inc.(a) |
10,052 | 483,803 | ||||||
|
Vontier Corp.(a) |
5,412 | 155,541 | ||||||
|
Zebra Technologies Corp., Class A(a) |
2,155 | 611,244 | ||||||
|
|
|
|||||||
| 8,743,909 | ||||||||
| Energy Equipment & Services — 0.1% | ||||||||
|
Baker Hughes Co. |
25,948 | 383,252 | ||||||
|
Halliburton Co. |
35,456 | 427,600 | ||||||
|
National Oilwell Varco Inc. |
15,443 | 129,721 | ||||||
|
Schlumberger Ltd. |
55,497 | 829,125 | ||||||
|
TechnipFMC PLC |
16,770 | 92,738 | ||||||
|
|
|
|||||||
| 1,862,436 | ||||||||
| Entertainment — 1.9% | ||||||||
|
Activision Blizzard Inc. |
30,848 | 2,336,119 | ||||||
|
Electronic Arts Inc.(a) |
11,573 | 1,386,793 | ||||||
|
Liberty Media Corp.-Liberty Formula One, Class A(a) |
925 | 30,803 | ||||||
|
Liberty Media Corp.-Liberty Formula One, Class C, NVS(a) |
8,185 | 295,724 | ||||||
|
Live Nation Entertainment Inc.(a) |
5,733 | 279,770 | ||||||
|
Madison Square Garden Sports Corp.(a) |
696 | 98,581 | ||||||
|
Netflix Inc.(a) |
17,652 | 8,397,762 | ||||||
|
Roku Inc.(a) |
4,250 | 860,200 | ||||||
|
Take-Two Interactive Software Inc.(a) |
4,590 | 711,083 | ||||||
|
Walt Disney Co. (The) |
72,326 | 8,769,527 | ||||||
|
Warner Music Group Corp., Class A |
3,554 | 94,288 | ||||||
|
World Wrestling Entertainment Inc., Class A |
1,912 | 69,520 | ||||||
|
Zynga Inc., Class A(a) |
40,144 | 360,895 | ||||||
|
|
|
|||||||
| 23,691,065 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 3.0% | ||||||||
|
Alexandria Real Estate Equities Inc. |
4,707 | 713,205 | ||||||
|
American Campus Communities Inc. |
5,528 | 207,079 | ||||||
|
American Homes 4 Rent, Class A |
10,771 | 304,496 | ||||||
|
American Tower Corp. |
17,727 | 4,071,006 | ||||||
|
Americold Realty Trust |
8,066 | 292,231 | ||||||
|
Apartment Investment & Management Co., Class A |
5,933 | 189,263 | ||||||
|
AvalonBay Communities Inc. |
5,626 | 782,745 | ||||||
|
Boston Properties Inc. |
5,609 | 406,148 | ||||||
|
Brixmor Property Group Inc. |
11,921 | 130,654 | ||||||
|
Camden Property Trust |
3,862 | 356,231 | ||||||
|
CoreSite Realty Corp. |
1,718 | 205,061 | ||||||
| Security | Shares | Value | ||||||
| Equity Real Estate Investment Trusts (REITs) (continued) | ||||||||
|
Corporate Office Properties Trust |
4,290 | $ | 96,225 | |||||
|
Cousins Properties Inc. |
5,940 | 151,351 | ||||||
|
Crown Castle International Corp. |
16,785 | 2,621,817 | ||||||
|
CubeSmart |
7,919 | 268,692 | ||||||
|
CyrusOne Inc. |
4,684 | 332,798 | ||||||
|
Digital Realty Trust Inc. |
10,802 | 1,558,729 | ||||||
|
Douglas Emmett Inc. |
6,671 | 157,436 | ||||||
|
Duke Realty Corp. |
14,860 | 564,531 | ||||||
|
EastGroup Properties Inc. |
1,566 | 208,403 | ||||||
|
Equinix Inc. |
3,550 | 2,595,902 | ||||||
|
Equity Commonwealth |
4,955 | 130,911 | ||||||
|
Equity LifeStyle Properties Inc. |
6,800 | 402,492 | ||||||
|
Equity Residential |
13,744 | 645,693 | ||||||
|
Essex Property Trust Inc. |
2,598 | 531,525 | ||||||
|
Extra Space Storage Inc. |
5,212 | 604,331 | ||||||
|
Federal Realty Investment Trust |
2,798 | 192,446 | ||||||
|
First Industrial Realty Trust Inc. |
5,035 | 200,443 | ||||||
|
Gaming and Leisure Properties Inc. |
8,370 | 304,250 | ||||||
|
Healthcare Realty Trust Inc. |
5,511 | 153,206 | ||||||
|
Healthcare Trust of America Inc., Class A(b) |
8,798 | 213,791 | ||||||
|
Healthpeak Properties Inc. |
21,680 | 584,710 | ||||||
|
Highwoods Properties Inc. |
4,073 | 121,253 | ||||||
|
Host Hotels & Resorts Inc. |
28,743 | 301,227 | ||||||
|
Hudson Pacific Properties Inc. |
6,312 | 121,569 | ||||||
|
Invitation Homes Inc. |
22,499 | 613,323 | ||||||
|
Iron Mountain Inc. |
11,347 | 295,703 | ||||||
|
JBG SMITH Properties |
4,325 | 100,989 | ||||||
|
Kilroy Realty Corp. |
4,264 | 200,749 | ||||||
|
Kimco Realty Corp. |
17,223 | 176,708 | ||||||
|
Lamar Advertising Co., Class A |
3,510 | 217,480 | ||||||
|
Lexington Realty Trust |
11,126 | 110,481 | ||||||
|
Life Storage Inc. |
1,833 | 209,237 | ||||||
|
Medical Properties Trust Inc. |
21,337 | 380,225 | ||||||
|
Mid-America Apartment Communities Inc. |
4,609 | 537,548 | ||||||
|
National Health Investors Inc. |
1,749 | 98,031 | ||||||
|
National Retail Properties Inc. |
6,884 | 220,357 | ||||||
|
Omega Healthcare Investors Inc. |
8,915 | 256,841 | ||||||
|
Physicians Realty Trust |
8,186 | 138,016 | ||||||
|
PotlatchDeltic Corp. |
2,804 | 116,506 | ||||||
|
Prologis Inc. |
29,497 | 2,926,102 | ||||||
|
PS Business Parks Inc. |
805 | 91,794 | ||||||
|
Public Storage |
6,104 | 1,398,243 | ||||||
|
Rayonier Inc. |
5,647 | 143,321 | ||||||
|
Realty Income Corp. |
13,728 | 794,302 | ||||||
|
Regency Centers Corp. |
6,332 | 225,356 | ||||||
|
Rexford Industrial Realty Inc. |
4,944 | 229,698 | ||||||
|
Sabra Health Care REIT Inc. |
8,446 | 111,149 | ||||||
|
SBA Communications Corp. |
4,487 | 1,302,890 | ||||||
|
Simon Property Group Inc. |
12,148 | 763,016 | ||||||
|
SL Green Realty Corp. |
2,940 | 125,861 | ||||||
|
Spirit Realty Capital Inc. |
4,002 | 120,260 | ||||||
|
STORE Capital Corp. |
8,974 | 230,632 | ||||||
|
Sun Communities Inc. |
3,958 | 544,740 | ||||||
|
Taubman Centers Inc. |
2,531 | 84,586 | ||||||
|
UDR Inc. |
11,743 | 366,851 | ||||||
|
Ventas Inc. |
14,941 | 589,721 | ||||||
|
VEREIT Inc. |
43,384 | 268,981 | ||||||
|
VICI Properties Inc. |
21,420 | 491,589 | ||||||
|
Vornado Realty Trust |
6,349 | 195,105 | ||||||
|
Welltower Inc. |
16,587 | 891,883 | ||||||
| 14 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Equity Real Estate Investment Trusts (REITs) (continued) | ||||||||
|
Weyerhaeuser Co. |
29,657 | $ | 809,340 | |||||
|
WP Carey Inc. |
6,941 | 434,576 | ||||||
|
|
|
|||||||
| 37,534,040 | ||||||||
| Food & Staples Retailing — 1.5% | ||||||||
|
BJ’s Wholesale Club Holdings Inc.(a) |
5,537 | 212,012 | ||||||
|
Casey’s General Stores Inc. |
1,493 | 251,675 | ||||||
|
Costco Wholesale Corp. |
17,681 | 6,323,079 | ||||||
|
Kroger Co. (The) |
31,224 | 1,005,725 | ||||||
|
Performance Food Group Co.(a) |
5,258 | 176,721 | ||||||
|
Sprouts Farmers Market Inc.(a) |
4,871 | 92,793 | ||||||
|
Sysco Corp. |
20,385 | 1,127,494 | ||||||
|
U.S. Foods Holding Corp.(a) |
8,867 | 185,320 | ||||||
|
Walgreens Boots Alliance Inc. |
28,868 | 982,667 | ||||||
|
Walmart Inc. |
55,582 | 7,712,003 | ||||||
|
|
|
|||||||
| 18,069,489 | ||||||||
| Food Products — 1.1% | ||||||||
|
Archer-Daniels-Midland Co. |
22,278 | 1,030,135 | ||||||
|
Beyond Meat Inc.(a) |
1,980 | 282,011 | ||||||
|
Bunge Ltd. |
5,584 | 316,780 | ||||||
|
Campbell Soup Co. |
8,126 | 379,240 | ||||||
|
Conagra Brands Inc. |
19,595 | 687,588 | ||||||
|
Darling Ingredients Inc.(a) |
6,343 | 272,749 | ||||||
|
Flowers Foods Inc. |
8,088 | 190,715 | ||||||
|
General Mills Inc. |
24,413 | 1,443,297 | ||||||
|
Hain Celestial Group Inc. (The)(a) |
3,378 | 103,873 | ||||||
|
Hershey Co. (The) |
5,883 | 808,677 | ||||||
|
Hormel Foods Corp. |
11,098 | 540,362 | ||||||
|
Ingredion Inc. |
2,668 | 189,134 | ||||||
|
JM Smucker Co. (The) |
4,530 | 508,266 | ||||||
|
Kellogg Co. |
10,217 | 642,547 | ||||||
|
Kraft Heinz Co. (The) |
26,008 | 795,585 | ||||||
|
Lamb Weston Holdings Inc. |
5,715 | 362,617 | ||||||
|
Lancaster Colony Corp. |
747 | 124,107 | ||||||
|
McCormick & Co. Inc./MD, NVS |
4,976 | 898,218 | ||||||
|
Mondelez International Inc., Class A |
57,084 | 3,032,302 | ||||||
|
Pilgrim’s Pride Corp.(a) |
2,065 | 34,568 | ||||||
|
Post Holdings Inc.(a) |
2,492 | 214,063 | ||||||
|
Seaboard Corp. |
10 | 34,450 | ||||||
|
TreeHouse Foods Inc.(a) |
2,189 | 85,021 | ||||||
|
Tyson Foods Inc., Class A |
11,816 | 676,230 | ||||||
|
|
|
|||||||
| 13,652,535 | ||||||||
| Gas Utilities — 0.1% | ||||||||
|
Atmos Energy Corp. |
4,947 | 453,492 | ||||||
|
National Fuel Gas Co. |
3,528 | 140,979 | ||||||
|
New Jersey Resources Corp. |
3,959 | 115,524 | ||||||
|
ONE Gas Inc. |
2,085 | 143,948 | ||||||
|
Southwest Gas Holdings Inc. |
2,196 | 144,321 | ||||||
|
Spire Inc. |
2,052 | 114,994 | ||||||
|
UGI Corp. |
8,392 | 271,397 | ||||||
|
|
|
|||||||
| 1,384,655 | ||||||||
| Health Care Equipment & Supplies — 3.8% | ||||||||
|
Abbott Laboratories |
70,879 | 7,450,092 | ||||||
|
ABIOMED Inc.(a) |
1,792 | 451,369 | ||||||
|
Align Technology Inc.(a) |
2,857 | 1,217,311 | ||||||
|
Baxter International Inc. |
20,324 | 1,576,533 | ||||||
|
Becton Dickinson and Co. |
11,580 | 2,676,485 | ||||||
|
Boston Scientific Corp.(a) |
57,177 | 1,959,456 | ||||||
|
Cooper Companies Inc. (The) |
1,969 | 628,209 | ||||||
|
Danaher Corp. |
25,287 | 5,804,378 | ||||||
| Security | Shares | Value | ||||||
| Health Care Equipment & Supplies (continued) | ||||||||
|
DENTSPLY SIRONA Inc. |
8,719 | $ | 411,450 | |||||
|
DexCom Inc.(a) |
3,847 | 1,229,424 | ||||||
|
Edwards Lifesciences Corp.(a) |
24,849 | 1,781,425 | ||||||
|
Globus Medical Inc., Class A(a) |
3,119 | 162,562 | ||||||
|
Haemonetics Corp.(a) |
1,996 | 201,776 | ||||||
|
Hill-Rom Holdings Inc. |
2,677 | 243,794 | ||||||
|
Hologic Inc.(a) |
10,401 | 715,797 | ||||||
|
ICU Medical Inc.(a) |
771 | 137,076 | ||||||
|
IDEXX Laboratories Inc.(a) |
3,411 | 1,449,061 | ||||||
|
Insulet Corp.(a) |
2,638 | 586,295 | ||||||
|
Integra LifeSciences Holdings Corp.(a)(b) |
2,830 | 124,803 | ||||||
|
Intuitive Surgical Inc.(a) |
4,675 | 3,118,599 | ||||||
|
Masimo Corp.(a) |
2,014 | 450,773 | ||||||
|
Medtronic PLC |
53,844 | 5,415,091 | ||||||
|
Neogen Corp.(a) |
2,046 | 142,688 | ||||||
|
Novocure Ltd.(a) |
3,368 | 411,233 | ||||||
|
NuVasive Inc.(a) |
2,015 | 89,526 | ||||||
|
Penumbra Inc.(a) |
1,361 | 355,262 | ||||||
|
Quidel Corp.(a) |
1,532 | 411,020 | ||||||
|
ResMed Inc. |
5,797 | 1,112,676 | ||||||
|
STERIS PLC |
3,398 | 602,092 | ||||||
|
Stryker Corp. |
13,055 | 2,637,240 | ||||||
|
Tandem Diabetes Care Inc.(a) |
2,445 | 266,505 | ||||||
|
Teleflex Inc. |
1,846 | 587,453 | ||||||
|
Varian Medical Systems Inc.(a) |
3,676 | 635,213 | ||||||
|
West Pharmaceutical Services Inc. |
2,938 | 799,342 | ||||||
|
Zimmer Biomet Holdings Inc. |
8,250 | 1,089,825 | ||||||
|
|
|
|||||||
| 46,931,834 | ||||||||
| Health Care Providers & Services — 2.5% | ||||||||
|
1Life Healthcare Inc.(a) |
2,888 | 81,470 | ||||||
|
Acadia Healthcare Co. Inc.(a) |
3,578 | 127,556 | ||||||
|
Amedisys Inc.(a) |
1,294 | 335,146 | ||||||
|
AmerisourceBergen Corp. |
5,899 | 566,717 | ||||||
|
Anthem Inc. |
10,046 | 2,740,549 | ||||||
|
Cardinal Health Inc. |
11,719 | 536,613 | ||||||
|
Centene Corp.(a) |
23,242 | 1,373,602 | ||||||
|
Chemed Corp. |
648 | 309,951 | ||||||
|
Cigna Corp. |
14,663 | 2,448,281 | ||||||
|
Covetrus Inc.(a) |
3,787 | 93,501 | ||||||
|
CVS Health Corp. |
52,303 | 2,933,675 | ||||||
|
DaVita Inc.(a) |
3,021 | 260,561 | ||||||
|
Encompass Health Corp. |
4,018 | 246,344 | ||||||
|
Guardant Health Inc.(a) |
3,391 | 361,684 | ||||||
|
HCA Healthcare Inc. |
10,564 | 1,309,302 | ||||||
|
HealthEquity Inc.(a) |
3,069 | 158,023 | ||||||
|
Henry Schein Inc.(a) |
5,662 | 359,990 | ||||||
|
Humana Inc. |
5,274 | 2,105,803 | ||||||
|
Laboratory Corp. of America Holdings(a) |
3,921 | 783,298 | ||||||
|
LHC Group Inc.(a) |
1,268 | 274,585 | ||||||
|
McKesson Corp. |
6,477 | 955,293 | ||||||
|
Molina Healthcare Inc.(a) |
2,380 | 443,799 | ||||||
|
Premier Inc., Class A |
2,924 | 95,703 | ||||||
|
Quest Diagnostics Inc. |
5,385 | 657,724 | ||||||
|
Tenet Healthcare Corp.(a) |
4,150 | 101,841 | ||||||
|
UnitedHealth Group Inc. |
38,025 | 11,602,949 | ||||||
|
Universal Health Services Inc., Class B |
3,119 | 341,686 | ||||||
|
|
|
|||||||
| 31,605,646 | ||||||||
| Health Care Technology — 0.3% | ||||||||
|
Cerner Corp. |
12,260 | 859,303 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
15 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Independent Power and Renewable Electricity Producers (continued) | ||||||||
|
Vistra Corp. |
19,619 | $ | 340,782 | |||||
|
|
|
|||||||
| 865,196 | ||||||||
| Industrial Conglomerates — 1.0% | ||||||||
|
3M Co. |
23,021 | 3,682,439 | ||||||
|
Carlisle Companies Inc. |
2,149 | 266,197 | ||||||
|
General Electric Co. |
349,830 | 2,595,738 | ||||||
|
Honeywell International Inc. |
28,047 | 4,626,353 | ||||||
|
Roper Technologies Inc. |
4,176 | 1,550,716 | ||||||
|
|
|
|||||||
| 12,721,443 | ||||||||
| Insurance — 2.0% | ||||||||
|
Aflac Inc. |
26,612 | 903,478 | ||||||
|
Alleghany Corp. |
568 | 310,656 | ||||||
|
Allstate Corp. (The) |
12,517 | 1,110,884 | ||||||
|
American Financial Group Inc./OH |
2,802 | 209,982 | ||||||
|
American International Group Inc. |
34,518 | 1,086,972 | ||||||
|
Aon PLC, Class A |
9,245 | 1,701,173 | ||||||
|
Arch Capital Group Ltd.(a) |
16,410 | 495,746 | ||||||
|
Arthur J Gallagher & Co. |
7,638 | 792,137 | ||||||
|
Assurant Inc. |
2,354 | 292,767 | ||||||
|
Athene Holding Ltd., Class A(a) |
5,068 | 162,581 | ||||||
|
Axis Capital Holdings Ltd. |
3,289 | 140,407 | ||||||
|
Brighthouse Financial Inc.(a) |
3,778 | 125,052 | ||||||
|
Brown & Brown Inc. |
9,470 | 412,040 | ||||||
|
Chubb Ltd. |
18,107 | 2,352,280 | ||||||
|
Cincinnati Financial Corp. |
5,957 | 421,398 | ||||||
|
CNA Financial Corp. |
1,068 | 31,816 | ||||||
|
Enstar Group Ltd.(a) |
508 | 87,310 | ||||||
|
Erie Indemnity Co., Class A, NVS |
1,001 | 233,103 | ||||||
|
Everest Re Group Ltd. |
1,586 | 312,569 | ||||||
|
Fidelity National Financial Inc. |
11,709 | 366,375 | ||||||
|
First American Financial Corp. |
4,409 | 196,597 | ||||||
|
Globe Life Inc. |
3,963 | 321,360 | ||||||
|
Hanover Insurance Group Inc. (The) |
1,460 | 139,664 | ||||||
|
Hartford Financial Services Group Inc. (The) |
14,439 | 556,190 | ||||||
|
Kemper Corp. |
2,370 | 146,134 | ||||||
|
Lincoln National Corp. |
7,291 | 255,914 | ||||||
|
Loews Corp. |
9,390 | 325,645 | ||||||
|
Markel Corp.(a) |
556 | 518,637 | ||||||
|
Marsh & McLennan Companies Inc. |
20,224 | 2,092,375 | ||||||
|
Mercury General Corp. |
1,066 | 43,397 | ||||||
|
MetLife Inc. |
30,967 | 1,172,101 | ||||||
|
Old Republic International Corp. |
11,704 | 190,541 | ||||||
|
Primerica Inc. |
1,587 | 174,951 | ||||||
|
Principal Financial Group Inc. |
10,100 | 396,122 | ||||||
|
Progressive Corp. (The) |
23,368 | 2,147,519 | ||||||
|
Prudential Financial Inc. |
15,718 | 1,006,266 | ||||||
|
Reinsurance Group of America Inc. |
2,730 | 275,785 | ||||||
|
RenaissanceRe Holdings Ltd. |
2,070 | 334,760 | ||||||
|
RLI Corp. |
1,636 | 141,841 | ||||||
|
Selective Insurance Group Inc. |
2,377 | 123,747 | ||||||
|
Travelers Companies Inc. (The) |
10,171 | 1,227,741 | ||||||
|
Unum Group |
8,221 | 145,183 | ||||||
|
White Mountains Insurance Group Ltd. |
117 | 106,275 | ||||||
|
Willis Towers Watson PLC |
5,145 | 938,860 | ||||||
|
WR Berkley Corp. |
5,644 | 339,317 | ||||||
|
|
|
|||||||
| 24,865,648 | ||||||||
| Interactive Media & Services — 5.6% | ||||||||
|
Alphabet Inc., Class A(a) |
12,023 | 19,430,491 | ||||||
|
Alphabet Inc., Class C, NVS(a) |
11,747 | 19,042,004 | ||||||
| 16 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Interactive Media & Services (continued) | ||||||||
|
ANGI Homeservices Inc., Class A(a) |
2,970 | $ | 31,482 | |||||
|
Cargurus Inc.(a) |
3,435 | 68,460 | ||||||
|
Facebook Inc., Class A(a) |
96,201 | 25,311,445 | ||||||
|
IAC/InterActiveCorp.(a)(b) |
3,192 | 385,338 | ||||||
|
Match Group Inc.(a) |
10,437 | 1,218,833 | ||||||
|
Pinterest Inc., Class A(a) |
18,571 | 1,094,760 | ||||||
|
Snap Inc., Class A, NVS(a) |
35,972 | 1,416,937 | ||||||
|
TripAdvisor Inc. |
3,555 | 67,936 | ||||||
|
Twitter Inc.(a) |
31,603 | 1,307,100 | ||||||
|
Zillow Group Inc., Class A(a) |
1,384 | 123,633 | ||||||
|
Zillow Group Inc., Class C, NVS(a)(b) |
5,743 | 508,945 | ||||||
|
|
|
|||||||
| 70,007,364 | ||||||||
| Internet & Direct Marketing Retail — 4.7% | ||||||||
|
Amazon.com Inc.(a) |
17,036 | 51,723,851 | ||||||
|
Booking Holdings Inc.(a) |
1,635 | 2,652,788 | ||||||
|
Chewy Inc., Class A(a) |
2,867 | 176,607 | ||||||
|
eBay Inc. |
26,605 | 1,267,196 | ||||||
|
Etsy Inc.(a) |
4,810 | 584,848 | ||||||
|
Expedia Group Inc. |
5,454 | 513,494 | ||||||
|
Grubhub Inc.(a) |
3,774 | 279,125 | ||||||
|
Qurate Retail Inc., Series A |
15,962 | 108,063 | ||||||
|
Wayfair Inc., Class A(a)(b) |
2,725 | 675,882 | ||||||
|
|
|
|||||||
| 57,981,854 | ||||||||
| IT Services — 5.4% | ||||||||
|
Accenture PLC, Class A |
25,426 | 5,515,154 | ||||||
|
Akamai Technologies Inc.(a) |
6,479 | 616,282 | ||||||
|
Amdocs Ltd. |
5,234 | 295,093 | ||||||
|
Automatic Data Processing Inc. |
17,163 | 2,711,067 | ||||||
|
Black Knight Inc.(a) |
6,303 | 554,349 | ||||||
|
Booz Allen Hamilton Holding Corp. |
5,523 | 433,555 | ||||||
|
Broadridge Financial Solutions Inc. |
4,583 | 630,621 | ||||||
|
CACI International Inc., Class A(a) |
994 | 207,279 | ||||||
|
Cognizant Technology Solutions Corp., Class A |
21,756 | 1,553,813 | ||||||
|
DXC Technology Co. |
10,351 | 190,665 | ||||||
|
EPAM Systems Inc.(a) |
2,248 | 694,520 | ||||||
|
Euronet Worldwide Inc.(a) |
2,052 | 182,300 | ||||||
|
Fastly Inc., Class A(a) |
2,976 | 189,006 | ||||||
|
Fidelity National Information Services Inc. |
24,763 | 3,085,222 | ||||||
|
Fiserv Inc.(a) |
22,184 | 2,117,906 | ||||||
|
FleetCor Technologies Inc.(a) |
3,376 | 745,792 | ||||||
|
Gartner Inc.(a) |
3,527 | 423,593 | ||||||
|
Genpact Ltd. |
7,121 | 244,749 | ||||||
|
Global Payments Inc. |
11,939 | 1,883,258 | ||||||
|
GoDaddy Inc., Class A(a) |
6,655 | 470,775 | ||||||
|
International Business Machines Corp. |
35,592 | 3,974,203 | ||||||
|
Jack Henry & Associates Inc. |
3,059 | 453,497 | ||||||
|
KBR Inc. |
5,489 | 122,350 | ||||||
|
Leidos Holdings Inc. |
5,309 | 440,647 | ||||||
|
LiveRamp Holdings Inc.(a) |
2,721 | 179,831 | ||||||
|
Mastercard Inc., Class A |
35,347 | 10,202,558 | ||||||
|
MAXIMUS Inc. |
2,521 | 170,369 | ||||||
|
MongoDB Inc.(a) |
2,030 | 463,794 | ||||||
|
Okta Inc.(a) |
4,671 | 980,116 | ||||||
|
Paychex Inc. |
12,828 | 1,055,103 | ||||||
|
PayPal Holdings Inc.(a) |
46,957 | 8,740,106 | ||||||
|
Perspecta Inc. |
5,596 | 100,336 | ||||||
|
Science Applications International Corp. |
2,335 | 178,324 | ||||||
|
Snowflake Inc., Class A(a) |
1,118 | 279,522 | ||||||
|
Square Inc., Class A(a) |
14,820 | 2,295,322 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| IT Services (continued) | ||||||||
|
Twilio Inc., Class A(a) |
5,482 | $ | 1,529,314 | |||||
|
VeriSign Inc.(a) |
4,033 | 769,093 | ||||||
|
Visa Inc., Class A |
67,461 | 12,258,338 | ||||||
|
Western Union Co. (The) |
16,491 | 320,585 | ||||||
|
WEX Inc.(a) |
1,754 | 221,969 | ||||||
|
|
|
|||||||
| 67,480,376 | ||||||||
| Leisure Products — 0.2% | ||||||||
|
Brunswick Corp./DE |
3,272 | 208,459 | ||||||
|
Hasbro Inc. |
5,053 | 417,984 | ||||||
|
Mattel Inc.(a) |
13,906 | 191,486 | ||||||
|
Peloton Interactive Inc., Class A(a) |
8,271 | 911,547 | ||||||
|
Polaris Inc. |
2,316 | 210,432 | ||||||
|
|
|
|||||||
| 1,939,908 | ||||||||
| Life Sciences Tools & Services — 1.4% | ||||||||
|
10X Genomics Inc., Class A(a) |
2,597 | 355,529 | ||||||
|
Agilent Technologies Inc. |
12,286 | 1,254,278 | ||||||
|
Avantor Inc.(a) |
17,884 | 416,161 | ||||||
|
Bio-Rad Laboratories Inc., Class A(a) |
859 | 503,735 | ||||||
|
Bio-Techne Corp. |
1,542 | 389,216 | ||||||
|
Bruker Corp. |
3,984 | 169,479 | ||||||
|
Charles River Laboratories International Inc.(a) |
1,967 | 447,886 | ||||||
|
Illumina Inc.(a) |
5,854 | 1,713,466 | ||||||
|
IQVIA Holdings Inc.(a) |
7,677 | 1,182,181 | ||||||
|
Mettler-Toledo International Inc.(a) |
965 | 962,983 | ||||||
|
PerkinElmer Inc. |
4,471 | 579,218 | ||||||
|
PPD Inc.(a) |
4,433 | 145,757 | ||||||
|
PRA Health Sciences Inc.(a) |
2,523 | 245,841 | ||||||
|
Repligen Corp.(a) |
1,960 | 326,477 | ||||||
|
Syneos Health Inc.(a) |
2,730 | 144,908 | ||||||
|
Thermo Fisher Scientific Inc. |
15,837 | 7,492,802 | ||||||
|
Waters Corp.(a) |
2,496 | 556,159 | ||||||
|
|
|
|||||||
| 16,886,076 | ||||||||
| Machinery — 1.7% | ||||||||
|
AGCO Corp. |
2,524 | 194,424 | ||||||
|
Allison Transmission Holdings Inc. |
4,365 | 157,795 | ||||||
|
Caterpillar Inc. |
21,642 | 3,398,876 | ||||||
|
Colfax Corp.(a)(b) |
4,039 | 109,820 | ||||||
|
Crane Co. |
2,012 | 102,109 | ||||||
|
Cummins Inc. |
5,880 | 1,292,953 | ||||||
|
Deere & Co. |
12,552 | 2,835,622 | ||||||
|
Donaldson Co. Inc. |
5,086 | 241,585 | ||||||
|
Dover Corp. |
5,739 | 635,365 | ||||||
|
Flowserve Corp. |
5,317 | 154,831 | ||||||
|
Fortive Corp. |
13,530 | 833,448 | ||||||
|
Gates Industrial Corp. PLC(a) |
1,823 | 20,235 | ||||||
|
Graco Inc. |
6,748 | 417,701 | ||||||
|
IDEX Corp. |
3,033 | 516,793 | ||||||
|
Illinois Tool Works Inc. |
11,499 | 2,252,424 | ||||||
|
Ingersoll Rand Inc.(a) |
14,899 | 520,571 | ||||||
|
ITT Inc. |
3,448 | 208,638 | ||||||
|
Lincoln Electric Holdings Inc. |
2,443 | 248,746 | ||||||
|
Middleby Corp. (The)(a) |
2,231 | 222,074 | ||||||
|
Navistar International Corp.(a) |
1,997 | 86,091 | ||||||
|
Nordson Corp. |
2,166 | 418,969 | ||||||
|
Oshkosh Corp. |
2,677 | 180,323 | ||||||
|
Otis Worldwide Corp. |
16,244 | 995,432 | ||||||
|
PACCAR Inc. |
13,808 | 1,178,927 | ||||||
|
Parker-Hannifin Corp. |
5,162 | 1,075,554 | ||||||
|
Pentair PLC |
6,741 | 335,432 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
17 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Machinery (continued) | ||||||||
|
Snap-on Inc. |
2,205 | $ | 347,354 | |||||
|
Stanley Black & Decker Inc. |
6,409 | 1,065,176 | ||||||
|
Timken Co. (The) |
2,641 | 157,668 | ||||||
|
Toro Co. (The) |
4,236 | 347,776 | ||||||
|
Westinghouse Air Brake Technologies Corp. |
7,103 | 421,208 | ||||||
|
Woodward Inc.(b) |
2,392 | 190,284 | ||||||
|
Xylem Inc./NY |
7,191 | 626,624 | ||||||
|
|
|
|||||||
| 21,790,828 | ||||||||
| Marine — 0.0% | ||||||||
|
Kirby Corp.(a) |
2,400 | 92,376 | ||||||
|
|
|
|||||||
| Media — 1.4% | ||||||||
|
Altice USA Inc., Class A(a) |
13,270 | 357,626 | ||||||
|
Cable One Inc. |
214 | 370,618 | ||||||
|
Charter Communications Inc., Class A(a) |
5,978 | 3,609,636 | ||||||
|
Comcast Corp., Class A |
182,486 | 7,708,209 | ||||||
|
Discovery Inc., Class A(a)(b) |
6,192 | 125,326 | ||||||
|
Discovery Inc., Class C, NVS(a) |
12,135 | 222,313 | ||||||
|
DISH Network Corp., Class A(a) |
9,902 | 252,402 | ||||||
|
Fox Corp., Class A, NVS |
13,638 | 361,680 | ||||||
|
Fox Corp., Class B(a) |
6,468 | 169,073 | ||||||
|
Interpublic Group of Companies Inc. (The) |
15,376 | 278,152 | ||||||
|
Liberty Broadband Corp., Class A(a) |
925 | 130,009 | ||||||
|
Liberty Broadband Corp., Class C, NVS(a) |
6,110 | 865,848 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM,
|
3,343 | 115,567 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class C, NVS(a) |
6,991 | 241,889 | ||||||
|
New York Times Co. (The), Class A |
5,677 | 225,150 | ||||||
|
News Corp., Class A, NVS |
15,505 | 203,581 | ||||||
|
News Corp., Class B |
4,676 | 60,881 | ||||||
|
Nexstar Media Group Inc., Class A |
1,802 | 148,485 | ||||||
|
Omnicom Group Inc. |
8,576 | 404,787 | ||||||
|
Sirius XM Holdings Inc.(b) |
48,778 | 279,498 | ||||||
|
TEGNA Inc. |
8,491 | 102,147 | ||||||
|
ViacomCBS Inc., Class A |
419 | 12,511 | ||||||
|
ViacomCBS Inc., Class B, NVS |
22,628 | 646,482 | ||||||
|
|
|
|||||||
| 16,891,870 | ||||||||
| Metals & Mining — 0.4% | ||||||||
|
Alcoa Corp.(a) |
7,337 | 94,794 | ||||||
|
Commercial Metals Co. |
4,621 | 95,424 | ||||||
|
Freeport-McMoRan Inc. |
58,103 | 1,007,506 | ||||||
|
Newmont Corp. |
32,095 | 2,016,850 | ||||||
|
Nucor Corp. |
12,188 | 582,099 | ||||||
|
Reliance Steel & Aluminum Co. |
2,556 | 278,578 | ||||||
|
Royal Gold Inc. |
2,656 | 315,559 | ||||||
|
Steel Dynamics Inc. |
8,022 | 252,533 | ||||||
|
|
|
|||||||
| 4,643,343 | ||||||||
| Mortgage Real Estate Investment — 0.1% | ||||||||
|
AGNC Investment Corp. |
21,778 | 304,239 | ||||||
|
Annaly Capital Management Inc. |
56,773 | 402,520 | ||||||
|
Blackstone Mortgage Trust Inc., Class A |
5,966 | 129,462 | ||||||
|
New Residential Investment Corp. |
17,076 | 128,070 | ||||||
|
Starwood Property Trust Inc. |
11,365 | 158,769 | ||||||
|
|
|
|||||||
| 1,123,060 | ||||||||
| Multi-Utilities — 0.9% | ||||||||
|
Ameren Corp. |
9,900 | 803,088 | ||||||
|
Avista Corp. |
2,677 | 88,930 | ||||||
|
Black Hills Corp. |
2,449 | 138,760 | ||||||
|
CenterPoint Energy Inc. |
21,943 | 463,656 | ||||||
|
CMS Energy Corp. |
11,422 | 723,355 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Multi-Utilities (continued) | ||||||||
|
Consolidated Edison Inc. |
13,308 | $ | 1,044,545 | |||||
|
Dominion Energy Inc. |
33,577 | 2,697,576 | ||||||
|
DTE Energy Co. |
7,703 | 950,704 | ||||||
|
MDU Resources Group Inc. |
8,161 | 193,905 | ||||||
|
NiSource Inc. |
15,418 | 354,152 | ||||||
|
NorthWestern Corp. |
2,097 | 109,317 | ||||||
|
Public Service Enterprise Group Inc. |
20,278 | 1,179,166 | ||||||
|
Sempra Energy |
11,610 | 1,455,430 | ||||||
|
WEC Energy Group Inc. |
12,619 | 1,268,840 | ||||||
|
|
|
|||||||
| 11,471,424 | ||||||||
| Multiline Retail — 0.5% | ||||||||
|
Dollar General Corp. |
9,934 | 2,073,325 | ||||||
|
Dollar Tree Inc.(a) |
9,507 | 858,672 | ||||||
|
Kohl’s Corp. |
6,335 | 134,872 | ||||||
|
Ollie’s Bargain Outlet Holdings Inc.(a) |
2,218 | 193,166 | ||||||
|
Target Corp. |
20,007 | 3,045,466 | ||||||
|
|
|
|||||||
| 6,305,501 | ||||||||
| Oil, Gas & Consumable Fuels — 1.7% | ||||||||
|
Apache Corp. |
14,998 | 124,483 | ||||||
|
Cabot Oil & Gas Corp. |
15,678 | 278,912 | ||||||
|
Cheniere Energy Inc.(a) |
9,118 | 436,479 | ||||||
|
Chevron Corp. |
77,081 | 5,357,129 | ||||||
|
Cimarex Energy Co. |
4,054 | 102,850 | ||||||
|
Concho Resources Inc. |
7,922 | 328,842 | ||||||
|
ConocoPhillips |
42,838 | 1,226,024 | ||||||
|
Continental Resources Inc./OK |
2,454 | 29,522 | ||||||
|
Devon Energy Corp. |
15,513 | 138,531 | ||||||
|
Diamondback Energy Inc. |
6,150 | 159,654 | ||||||
|
EOG Resources Inc. |
23,306 | 797,997 | ||||||
|
EQT Corp. |
11,025 | 166,919 | ||||||
|
Equitrans Midstream Corp. |
16,371 | 118,853 | ||||||
|
Exxon Mobil Corp. |
168,984 | 5,512,258 | ||||||
|
Hess Corp. |
10,972 | 408,378 | ||||||
|
HollyFrontier Corp. |
6,068 | 112,319 | ||||||
|
Kinder Morgan Inc./DE |
78,274 | 931,461 | ||||||
|
Marathon Oil Corp. |
31,817 | 125,995 | ||||||
|
Marathon Petroleum Corp. |
26,013 | 767,383 | ||||||
|
Occidental Petroleum Corp. |
33,600 | 306,768 | ||||||
|
ONEOK Inc. |
17,719 | 513,851 | ||||||
|
Ovintiv Inc. |
10,410 | 95,772 | ||||||
|
Parsley Energy Inc., Class A |
12,405 | 124,174 | ||||||
|
Phillips 66 |
17,366 | 810,298 | ||||||
|
Pioneer Natural Resources Co. |
6,588 | 524,141 | ||||||
|
Targa Resources Corp. |
9,382 | 150,581 | ||||||
|
Valero Energy Corp. |
16,230 | 626,640 | ||||||
|
Williams Companies Inc. (The) |
48,237 | 925,668 | ||||||
|
WPX Energy Inc.(a) |
16,939 | 78,089 | ||||||
|
|
|
|||||||
| 21,279,971 | ||||||||
| Paper & Forest Products — 0.0% | ||||||||
|
Louisiana-Pacific Corp. |
4,508 | 128,839 | ||||||
|
|
|
|||||||
| Personal Products — 0.2% | ||||||||
|
Coty Inc., Class A |
11,959 | 34,681 | ||||||
|
Estee Lauder Companies Inc. (The), Class A |
9,051 | 1,988,143 | ||||||
|
Herbalife Nutrition Ltd.(a) |
3,932 | 177,490 | ||||||
|
|
|
|||||||
| 2,200,314 | ||||||||
| Pharmaceuticals — 3.6% | ||||||||
|
Bristol-Myers Squibb Co. |
90,079 | 5,265,117 | ||||||
|
Catalent Inc.(a) |
6,537 | 573,752 | ||||||
| 18 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Pharmaceuticals (continued) | ||||||||
|
Elanco Animal Health Inc.(a) |
13,129 | $ | 407,130 | |||||
|
Eli Lilly & Co. |
31,728 | 4,139,235 | ||||||
|
Horizon Therapeutics PLC(a) |
8,486 | 635,856 | ||||||
|
Jazz Pharmaceuticals PLC(a) |
2,179 | 313,994 | ||||||
|
Johnson & Johnson |
105,346 | 14,443,990 | ||||||
|
Merck & Co. Inc. |
101,246 | 7,614,712 | ||||||
|
Mylan NV(a) |
20,599 | 299,509 | ||||||
|
Nektar Therapeutics(a) |
7,290 | 115,474 | ||||||
|
Perrigo Co. PLC |
5,454 | 239,267 | ||||||
|
Pfizer Inc. |
222,435 | 7,891,994 | ||||||
|
Royalty Pharma PLC, Class A |
3,108 | 114,064 | ||||||
|
Zoetis Inc. |
18,982 | 3,009,596 | ||||||
|
|
|
|||||||
| 45,063,690 | ||||||||
| Professional Services — 0.5% | ||||||||
|
ASGN Inc.(a) |
2,065 | 137,694 | ||||||
|
CoreLogic Inc. |
3,129 | 240,714 | ||||||
|
CoStar Group Inc.(a) |
1,572 | 1,294,715 | ||||||
|
Equifax Inc. |
4,894 | 668,520 | ||||||
|
FTI Consulting Inc.(a) |
1,496 | 147,296 | ||||||
|
IHS Markit Ltd. |
14,971 | 1,210,705 | ||||||
|
Insperity Inc. |
1,422 | 108,897 | ||||||
|
ManpowerGroup Inc. |
2,263 | 153,590 | ||||||
|
Nielsen Holdings PLC |
14,547 | 196,530 | ||||||
|
Robert Half International Inc. |
4,523 | 229,271 | ||||||
|
TransUnion |
7,578 | 603,663 | ||||||
|
TriNet Group Inc.(a) |
1,693 | 116,682 | ||||||
|
Verisk Analytics Inc.(b) |
6,494 | 1,155,737 | ||||||
|
|
|
|||||||
| 6,264,014 | ||||||||
|
Real Estate Management & Development — 0.1% |
|
|||||||
|
CBRE Group Inc., Class A(a) |
13,491 | 679,947 | ||||||
|
Howard Hughes Corp. (The)(a)(b) |
1,733 | 107,775 | ||||||
|
Jones Lang LaSalle Inc. |
2,065 | 233,056 | ||||||
|
|
|
|||||||
| 1,020,778 | ||||||||
| Road & Rail — 1.1% | ||||||||
|
AMERCO |
369 | 128,102 | ||||||
|
CSX Corp. |
30,673 | 2,421,327 | ||||||
|
JB Hunt Transport Services Inc. |
3,289 | 400,403 | ||||||
|
Kansas City Southern |
3,758 | 661,934 | ||||||
|
Knight-Swift Transportation Holdings Inc. |
5,046 | 191,698 | ||||||
|
Landstar System Inc. |
1,506 | 187,798 | ||||||
|
Lyft Inc., Class A(a) |
9,738 | 222,318 | ||||||
|
Norfolk Southern Corp. |
10,180 | 2,128,842 | ||||||
|
Old Dominion Freight Line Inc. |
3,828 | 728,736 | ||||||
|
Uber Technologies Inc.(a) |
55,233 | 1,845,334 | ||||||
|
Union Pacific Corp. |
27,130 | 4,807,165 | ||||||
|
|
|
|||||||
| 13,723,657 | ||||||||
|
Semiconductors & Semiconductor Equipment — 4.9% |
|
|||||||
|
Advanced Micro Devices Inc.(a) |
46,921 | 3,532,682 | ||||||
|
Analog Devices Inc. |
14,806 | 1,754,955 | ||||||
|
Applied Materials Inc. |
36,440 | 2,158,341 | ||||||
|
Broadcom Inc. |
16,074 | 5,619,953 | ||||||
|
Cirrus Logic Inc.(a) |
2,280 | 157,024 | ||||||
|
Cree Inc.(a) |
4,398 | 279,713 | ||||||
|
Enphase Energy Inc.(a) |
5,058 | 496,139 | ||||||
|
Entegris Inc. |
5,329 | 398,449 | ||||||
|
First Solar Inc.(a) |
3,427 | 298,303 | ||||||
|
Inphi Corp.(a) |
2,084 | 291,260 | ||||||
|
Intel Corp. |
170,255 | 7,538,891 | ||||||
|
KLA Corp. |
6,244 | 1,231,192 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
19 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Software (continued) | ||||||||
|
Palo Alto Networks Inc.(a) |
3,871 | $ | 856,226 | |||||
|
Paycom Software Inc.(a) |
1,962 | 714,345 | ||||||
|
Paylocity Holding Corp.(a) |
1,496 | 277,538 | ||||||
|
Pegasystems Inc. |
1,581 | 183,206 | ||||||
|
Pluralsight Inc., Class A(a) |
4,036 | 63,365 | ||||||
|
Proofpoint Inc.(a) |
2,254 | 215,798 | ||||||
|
PTC Inc.(a) |
4,216 | 353,638 | ||||||
|
RealPage Inc.(a) |
3,630 | 202,155 | ||||||
|
RingCentral Inc., Class A(a) |
3,103 | 801,629 | ||||||
|
salesforce.com Inc.(a) |
36,421 | 8,459,506 | ||||||
|
ServiceNow Inc.(a) |
7,665 | 3,813,874 | ||||||
|
Slack Technologies Inc., Class A(a)(b) |
17,364 | 444,171 | ||||||
|
Smartsheet Inc., Class A(a) |
4,501 | 224,375 | ||||||
|
SolarWinds Corp.(a) |
2,613 | 53,384 | ||||||
|
Splunk Inc.(a) |
6,386 | 1,264,683 | ||||||
|
SS&C Technologies Holdings Inc. |
8,899 | 526,999 | ||||||
|
Synopsys Inc.(a) |
6,077 | 1,299,627 | ||||||
|
Trade Desk Inc. (The), Class A(a) |
1,670 | 945,972 | ||||||
|
Tyler Technologies Inc.(a)(b) |
1,604 | 616,546 | ||||||
|
Verint Systems Inc.(a) |
2,505 | 121,543 | ||||||
|
VMware Inc., Class A(a) |
3,246 | 417,858 | ||||||
|
Workday Inc., Class A(a) |
6,984 | 1,467,478 | ||||||
|
Zendesk Inc.(a) |
4,561 | 505,997 | ||||||
|
Zoom Video Communications Inc., Class A(a) |
7,278 | 3,354,503 | ||||||
|
Zscaler Inc.(a) |
2,881 | 391,096 | ||||||
|
|
|
|||||||
| 120,992,522 | ||||||||
| Specialty Retail — 2.4% | ||||||||
|
Aaron’s Holdings Co. Inc. |
2,793 | 145,962 | ||||||
|
Advance Auto Parts Inc. |
2,737 | 403,105 | ||||||
|
AutoNation Inc.(a) |
2,332 | 132,294 | ||||||
|
AutoZone Inc.(a) |
930 | 1,049,951 | ||||||
|
Best Buy Co. Inc. |
9,190 | 1,025,145 | ||||||
|
Burlington Stores Inc.(a)(b) |
2,614 | 506,018 | ||||||
|
CarMax Inc.(a) |
6,480 | 560,131 | ||||||
|
Carvana Co.(a)(b) |
2,226 | 412,589 | ||||||
|
Dick’s Sporting Goods Inc. |
2,684 | 152,049 | ||||||
|
Five Below Inc.(a) |
2,236 | 298,148 | ||||||
|
Floor & Decor Holdings Inc., Class A(a) |
4,164 | 303,972 | ||||||
|
Foot Locker Inc. |
4,107 | 151,466 | ||||||
|
Gap Inc. (The) |
8,491 | 165,150 | ||||||
|
Home Depot Inc. (The) |
43,072 | 11,487,733 | ||||||
|
L Brands Inc. |
9,510 | 304,415 | ||||||
|
Lithia Motors Inc., Class A |
1,007 | 231,177 | ||||||
|
Lowe’s Companies Inc. |
30,204 | 4,775,253 | ||||||
|
Murphy USA Inc.(a) |
1,083 | 132,440 | ||||||
|
National Vision Holdings Inc.(a) |
3,141 | 126,677 | ||||||
|
O’Reilly Automotive Inc.(a) |
2,960 | 1,292,336 | ||||||
|
Penske Automotive Group Inc. |
1,176 | 60,164 | ||||||
|
RH(a) |
619 | 207,507 | ||||||
|
Ross Stores Inc. |
14,175 | 1,207,285 | ||||||
|
Tiffany & Co. |
4,300 | 562,612 | ||||||
|
TJX Companies Inc. (The) |
47,921 | 2,434,387 | ||||||
|
Tractor Supply Co. |
4,619 | 615,297 | ||||||
|
Ulta Beauty Inc.(a) |
2,235 | 462,131 | ||||||
|
Williams-Sonoma Inc. |
3,165 | 288,680 | ||||||
|
|
|
|||||||
| 29,494,074 | ||||||||
| Technology Hardware, Storage & Peripherals — 5.9% | ||||||||
|
Apple Inc. |
643,255 | 70,024,739 | ||||||
|
Dell Technologies Inc., Class C(a) |
9,412 | 567,167 | ||||||
| 20 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Wireless Telecommunication Services (continued) | ||||||||
|
U.S. Cellular Corp.(a) |
593 | $ | 17,268 | |||||
|
|
|
|||||||
| 2,563,456 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
1,243,048,780 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 0.9% |
||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
8,935,121 | 8,941,375 | ||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
2,586,000 | 2,586,000 | ||||||
|
|
|
|||||||
| 11,527,375 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.9%
|
|
11,527,375 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.8%
|
|
1,254,576,155 | ||||||
|
Other Assets, Less Liabilities — (0.8)% |
|
(9,567,280 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,245,008,875 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at
|
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 25,108,982 | $ | — | $ | (16,160,674 | )(a) | $ | 21,883 | $ | (28,816 | ) | $ | 8,941,375 | 8,935,121 | $ | 66,183 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
2,196,000 | 390,000 | (a) | — | — | — | 2,586,000 | 2,586,000 | 1,338 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
2,504,176 | 799,225 | (509,717 | ) | 156,077 | 446,561 | 3,396,322 | 5,668 | 46,105 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 177,960 | $ | 417,745 | $ | 14,923,697 | $ | 113,626 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
10 | 12/18/20 | $ | 1,632 | $ | (70,687 | ) | |||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
21 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Dow Jones U.S. ETF
|
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 70,687 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 598,224 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (377,560 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 2,702,182 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,243,048,780 | $ | — | $ | — | $ | 1,243,048,780 | ||||||||
|
Money Market Funds |
11,527,375 | — | — | 11,527,375 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,254,576,155 | $ | — | $ | — | $ | 1,254,576,155 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (70,687 | ) | $ | — | $ | — | $ | (70,687 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 22 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Transportation Average ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
|
Common Stocks |
||||||||
|
Air Freight & Logistics — 27.4% |
||||||||
|
CH Robinson Worldwide Inc. |
618,736 | $ | 54,714,825 | |||||
|
Expeditors International of Washington
|
614,504 | 54,303,719 | ||||||
|
FedEx Corp. |
592,103 | 153,632,965 | ||||||
|
United Parcel Service Inc., Class B |
353,293 | 55,505,863 | ||||||
|
|
|
|||||||
| 318,157,372 | ||||||||
| Airlines — 17.5% | ||||||||
|
Alaska Air Group Inc. |
1,075,368 | 40,745,694 | ||||||
|
American Airlines Group Inc.(a) |
2,067,419 | 23,320,486 | ||||||
|
Delta Air Lines Inc. |
1,165,052 | 35,697,193 | ||||||
|
JetBlue Airways Corp.(a)(b) |
2,046,859 | 24,500,902 | ||||||
|
Southwest Airlines Co. |
1,047,368 | 41,402,457 | ||||||
|
United Airlines Holdings Inc.(a)(b) |
1,117,187 | 37,827,952 | ||||||
|
|
|
|||||||
| 203,494,684 | ||||||||
| Marine — 5.4% | ||||||||
|
Kirby Corp.(b) |
766,798 | 29,514,055 | ||||||
|
Matson Inc. |
636,018 | 33,041,135 | ||||||
|
|
|
|||||||
| 62,555,190 | ||||||||
| Road & Rail — 49.7% | ||||||||
|
Avis Budget Group Inc.(a)(b) |
1,082,276 | 36,440,233 | ||||||
|
CSX Corp. |
721,817 | 56,980,234 | ||||||
|
JB Hunt Transport Services Inc. |
443,499 | 53,991,568 | ||||||
|
Kansas City Southern |
570,122 | 100,421,289 | ||||||
|
Landstar System Inc. |
580,893 | 72,437,357 | ||||||
|
Norfolk Southern Corp. |
578,376 | 120,949,989 | ||||||
|
Ryder System Inc. |
688,552 | 33,918,072 | ||||||
|
Union Pacific Corp. |
570,155 | 101,025,764 | ||||||
|
|
|
|||||||
| 576,164,506 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 100.0%
|
1,160,371,752 | |||||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
|
|
||||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 1.7% |
||||||||
|
BlackRock Cash Funds: Institutional,
|
17,642,517 | $ | 17,654,867 | |||||
|
BlackRock Cash Funds: Treasury,
|
2,258,000 | 2,258,000 | ||||||
|
|
|
|||||||
| 19,912,867 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.7%
|
|
19,912,867 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.7%
|
|
1,180,284,619 | ||||||
|
Other Assets, Less Liabilities — (1.7)% |
|
(19,793,705 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,160,490,914 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at
|
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 25,459,460 | $ | — | $ | (7,791,022 | )(a) | $ | (2,745 | ) | $ | (10,826 | ) | $ | 17,654,867 | 17,642,517 | $ | 136,469 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
988,000 | 1,270,000 | (a) | — | — | — | 2,258,000 | 2,258,000 | 902 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (2,745 | ) | $ | (10,826 | ) | $ | 19,912,867 | $ | 137,371 | $ | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
23 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Transportation Average ETF
|
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P MidCap 400 E-Mini Index |
2 | 12/18/20 | $ | 379 | $ | 9,083 | ||||||||||
|
S&P Select Sector Industrial E-Mini Index |
6 | 12/18/20 | 457 | (7,994 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | 1,089 | |||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 9,083 | ||
|
|
|
|||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
7,994 | |||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 199,177 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (24,951 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 664,177 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
| 24 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Transportation Average ETF
|
Fair Value Measurements (continued)
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,160,371,752 | $ | — | $ | — | $ | 1,160,371,752 | ||||||||
|
Money Market Funds |
19,912,867 | — | — | 19,912,867 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,180,284,619 | $ | — | $ | — | $ | 1,180,284,619 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 9,083 | $ | — | $ | — | $ | 9,083 | ||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
(7,994 | ) | — | — | (7,994 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,089 | $ | — | $ | — | $ | 1,089 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
25 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Energy ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
|
Common Stocks |
||||||||
|
Electric Utilities — 1.0% |
||||||||
|
OGE Energy Corp. |
122,885 | $ | 3,781,171 | |||||
|
|
|
|||||||
|
Energy Equipment & Services — 7.9% |
||||||||
|
Baker Hughes Co. |
401,021 | 5,923,080 | ||||||
|
Halliburton Co. |
536,411 | 6,469,117 | ||||||
|
National Oilwell Varco Inc. |
241,459 | 2,028,255 | ||||||
|
Schlumberger Ltd. |
844,221 | 12,612,662 | ||||||
|
TechnipFMC PLC(a) |
265,260 | 1,466,888 | ||||||
|
|
|
|||||||
| 28,500,002 | ||||||||
|
Oil, Gas & Consumable Fuels — 89.5% |
|
|||||||
|
Apache Corp. |
234,710 | 1,948,093 | ||||||
|
Cabot Oil & Gas Corp. |
244,180 | 4,343,962 | ||||||
|
Cheniere Energy Inc.(b) |
140,089 | 6,706,060 | ||||||
|
Chevron Corp. |
1,166,701 | 81,085,719 | ||||||
|
Cimarex Energy Co. |
63,849 | 1,619,849 | ||||||
|
Concho Resources Inc. |
120,350 | 4,995,729 | ||||||
|
ConocoPhillips |
588,845 | 16,852,744 | ||||||
|
Continental Resources Inc./OK |
41,677 | 501,374 | ||||||
|
Devon Energy Corp. |
237,887 | 2,124,331 | ||||||
|
Diamondback Energy Inc. |
97,551 | 2,532,424 | ||||||
|
EOG Resources Inc. |
354,140 | 12,125,754 | ||||||
|
EQT Corp. |
170,150 | 2,576,071 | ||||||
|
Equitrans Midstream Corp. |
253,208 | 1,838,290 | ||||||
|
Exxon Mobil Corp. |
2,562,519 | 83,589,370 | ||||||
|
Hess Corp. |
166,922 | 6,212,837 | ||||||
|
HollyFrontier Corp. |
93,132 | 1,723,873 | ||||||
|
Kinder Morgan Inc./DE |
1,183,279 | 14,081,020 | ||||||
|
Marathon Oil Corp. |
490,909 | 1,944,000 | ||||||
|
Marathon Petroleum Corp. |
395,873 | 11,678,254 | ||||||
|
Occidental Petroleum Corp. |
512,624 | 4,680,257 | ||||||
|
ONEOK Inc. |
270,759 | 7,852,011 | ||||||
|
Ovintiv Inc. |
162,951 | 1,499,149 | ||||||
|
Parsley Energy Inc., Class A |
185,744 | 1,859,297 | ||||||
|
Phillips 66 |
265,591 | 12,392,476 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
|
Oil, Gas & Consumable Fuels (continued) |
|
|||||||
|
Pioneer Natural Resources Co. |
100,118 | $ | 7,965,388 | |||||
|
Targa Resources Corp. |
144,417 | 2,317,893 | ||||||
|
Valero Energy Corp. |
248,326 | 9,587,867 | ||||||
|
Williams Companies Inc. (The) |
737,698 | 14,156,425 | ||||||
|
WPX Energy Inc.(a)(b) |
256,424 | 1,182,115 | ||||||
|
|
|
|||||||
| 321,972,632 | ||||||||
|
Semiconductors & Semiconductor Equipment — 1.3% |
|
|||||||
|
First Solar Inc.(b) |
51,926 | 4,519,899 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.7%
|
358,773,704 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 0.2% |
||||||||
|
BlackRock Cash Funds: Institutional,
|
227,479 | 227,638 | ||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
360,000 | 360,000 | ||||||
|
|
|
|||||||
| 587,638 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.2%
|
587,638 | |||||||
|
|
|
|||||||
|
Total Investments in Securities — 99.9%
|
359,361,342 | |||||||
|
Other Assets, Less Liabilities — 0.1% |
510,155 | |||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 359,871,497 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional,
|
$ | 3,665,480 | $ | — | $ | (3,433,627 | )(a) | $ | (233 | ) | $ | (3,982 | ) | $ | 227,638 | 227,479 | $ | 29,514 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,240,000 | — | (880,000 | )(a) | — | — | 360,000 | 360,000 | 425 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (233 | ) | $ | (3,982 | ) | $ | 587,638 | $ | 29,939 | $ | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
| 26 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Energy ETF
|
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Energy E-Mini Index |
37 | 12/18/20 | $ | 1,096 | $ | (11,538 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 11,538 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 296,302 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (136,570 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,012,090 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 358,773,704 | $ | — | $ | — | $ | 358,773,704 | ||||||||
|
Money Market Funds |
587,638 | — | — | 587,638 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 359,361,342 | $ | — | $ | — | $ | 359,361,342 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (11,538 | ) | $ | — | $ | — | $ | (11,538 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
27 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Healthcare ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
|
Common Stocks |
|
|||||||
|
Biotechnology — 17.0% |
|
|||||||
|
AbbVie Inc. |
919,986 | $ | 78,290,809 | |||||
|
ACADIA Pharmaceuticals Inc.(a) |
60,006 | 2,787,279 | ||||||
|
Acceleron Pharma Inc.(a) |
27,199 | 2,844,471 | ||||||
|
Agios Pharmaceuticals Inc.(a) |
29,939 | 1,199,656 | ||||||
|
Alexion Pharmaceuticals Inc.(a) |
114,232 | 13,152,673 | ||||||
|
Alkermes PLC(a) |
82,725 | 1,344,281 | ||||||
|
Allogene Therapeutics Inc.(a)(b) |
33,957 | 1,151,821 | ||||||
|
Alnylam Pharmaceuticals Inc.(a) |
60,469 | 7,435,873 | ||||||
|
Amgen Inc. |
305,315 | 66,235,036 | ||||||
|
Biogen Inc.(a) |
82,526 | 20,802,329 | ||||||
|
BioMarin Pharmaceutical Inc.(a) |
94,592 | 7,040,483 | ||||||
|
Bluebird Bio Inc.(a) |
34,254 | 1,771,274 | ||||||
|
Blueprint Medicines Corp.(a) |
28,837 | 2,949,448 | ||||||
|
Emergent BioSolutions Inc.(a) |
23,482 | 2,112,676 | ||||||
|
Exact Sciences Corp.(a)(b) |
78,281 | 9,693,536 | ||||||
|
Exelixis Inc.(a) |
160,668 | 3,290,481 | ||||||
|
FibroGen Inc.(a) |
43,388 | 1,665,231 | ||||||
|
Gilead Sciences Inc. |
653,551 | 38,003,991 | ||||||
|
Incyte Corp.(a) |
96,904 | 8,395,763 | ||||||
|
Ionis Pharmaceuticals Inc.(a) |
72,968 | 3,425,848 | ||||||
|
Moderna Inc.(a) |
156,252 | 10,542,322 | ||||||
|
Neurocrine Biosciences Inc.(a) |
48,687 | 4,803,946 | ||||||
|
Novavax Inc.(a) |
29,426 | 2,374,972 | ||||||
|
Regeneron Pharmaceuticals Inc.(a) |
54,497 | 29,622,389 | ||||||
|
Sarepta Therapeutics Inc.(a) |
40,828 | 5,548,933 | ||||||
|
Seagen Inc.(a) |
63,588 | 10,606,478 | ||||||
|
Ultragenyx Pharmaceutical Inc.(a)(b) |
31,801 | 3,196,001 | ||||||
|
United Therapeutics Corp.(a) |
23,069 | 3,096,552 | ||||||
|
Vertex Pharmaceuticals Inc.(a) |
135,778 | 28,290,704 | ||||||
|
Vir Biotechnology Inc.(a)(b) |
33,822 | 1,063,364 | ||||||
|
|
|
|||||||
| 372,738,620 | ||||||||
| Health Care Equipment & Supplies — 27.8% | ||||||||
|
Abbott Laboratories |
922,956 | 97,011,905 | ||||||
|
ABIOMED Inc.(a) |
23,440 | 5,904,067 | ||||||
|
Align Technology Inc.(a) |
37,374 | 15,924,314 | ||||||
|
Baxter International Inc. |
263,893 | 20,470,180 | ||||||
|
Becton Dickinson and Co. |
151,105 | 34,924,899 | ||||||
|
Boston Scientific Corp.(a) |
745,794 | 25,558,360 | ||||||
|
Cooper Companies Inc. (The)(b) |
25,613 | 8,171,828 | ||||||
|
Danaher Corp. |
329,127 | 75,547,812 | ||||||
|
DENTSPLY SIRONA Inc.(b) |
114,072 | 5,383,058 | ||||||
|
DexCom Inc.(a) |
49,909 | 15,949,918 | ||||||
|
Edwards Lifesciences Corp.(a) |
324,106 | 23,235,159 | ||||||
|
Globus Medical Inc., Class A(a) |
39,316 | 2,049,150 | ||||||
|
Haemonetics Corp.(a) |
26,356 | 2,664,328 | ||||||
|
Hill-Rom Holdings Inc. |
34,765 | 3,166,049 | ||||||
|
Hologic Inc.(a) |
135,006 | 9,291,113 | ||||||
|
ICU Medical Inc.(a) |
10,107 | 1,796,924 | ||||||
|
IDEXX Laboratories Inc.(a) |
44,338 | 18,835,669 | ||||||
|
Insulet Corp.(a)(b) |
34,232 | 7,608,062 | ||||||
|
Integra LifeSciences Holdings Corp.(a) |
36,900 | 1,627,290 | ||||||
|
Intuitive Surgical Inc.(a) |
61,004 | 40,694,548 | ||||||
|
Masimo Corp.(a) |
26,297 | 5,885,795 | ||||||
|
Medtronic PLC |
700,723 | 70,471,712 | ||||||
|
Neogen Corp.(a) |
27,574 | 1,923,011 | ||||||
|
Novocure Ltd.(a) |
43,764 | 5,343,584 | ||||||
|
NuVasive Inc.(a) |
26,592 | 1,181,483 | ||||||
|
Penumbra Inc.(a) |
17,531 | 4,576,117 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Health Care Equipment & Supplies (continued) | ||||||||
|
Quidel Corp.(a) |
19,909 | $ | 5,341,386 | |||||
|
ResMed Inc. |
75,526 | 14,496,460 | ||||||
|
STERIS PLC |
44,348 | 7,858,022 | ||||||
|
Stryker Corp. |
170,345 | 34,411,393 | ||||||
|
Tandem Diabetes Care Inc.(a)(b) |
31,790 | 3,465,110 | ||||||
|
Teleflex Inc. |
24,248 | 7,716,441 | ||||||
|
Varian Medical Systems Inc.(a) |
47,518 | 8,211,110 | ||||||
|
West Pharmaceutical Services Inc. |
38,478 | 10,468,709 | ||||||
|
Zimmer Biomet Holdings Inc. |
107,930 | 14,257,553 | ||||||
|
|
|
|||||||
| 611,422,519 | ||||||||
| Health Care Providers & Services — 18.1% | ||||||||
|
1Life Healthcare Inc.(a) |
37,556 | 1,059,455 | ||||||
|
Acadia Healthcare Co. Inc.(a) |
46,653 | 1,663,179 | ||||||
|
Amedisys Inc.(a) |
16,946 | 4,389,014 | ||||||
|
Anthem Inc. |
131,107 | 35,765,990 | ||||||
|
Centene Corp.(a) |
302,071 | 17,852,396 | ||||||
|
Chemed Corp. |
8,310 | 3,974,839 | ||||||
|
Cigna Corp. |
191,418 | 31,961,063 | ||||||
|
Covetrus Inc.(a)(b) |
51,068 | 1,260,869 | ||||||
|
CVS Health Corp. |
682,212 | 38,265,271 | ||||||
|
DaVita Inc.(a)(b) |
39,295 | 3,389,194 | ||||||
|
Encompass Health Corp. |
51,905 | 3,182,296 | ||||||
|
Guardant Health Inc.(a) |
44,117 | 4,705,519 | ||||||
|
HCA Healthcare Inc. |
137,446 | 17,035,057 | ||||||
|
HealthEquity Inc.(a) |
40,086 | 2,064,028 | ||||||
|
Henry Schein Inc.(a) |
74,507 | 4,737,155 | ||||||
|
Humana Inc. |
68,963 | 27,535,547 | ||||||
|
Laboratory Corp. of America Holdings(a) |
50,760 | 10,140,325 | ||||||
|
LHC Group Inc.(a)(b) |
16,489 | 3,570,693 | ||||||
|
McKesson Corp. |
84,521 | 12,466,002 | ||||||
|
Molina Healthcare Inc.(a) |
30,900 | 5,761,923 | ||||||
|
Premier Inc., Class A |
36,895 | 1,207,573 | ||||||
|
Quest Diagnostics Inc. |
70,011 | 8,551,144 | ||||||
|
Tenet Healthcare Corp.(a) |
54,598 | 1,339,835 | ||||||
|
UnitedHealth Group Inc. |
495,399 | 151,166,051 | ||||||
|
Universal Health Services Inc., Class B |
40,554 | 4,442,691 | ||||||
|
|
|
|||||||
| 397,487,109 | ||||||||
| Health Care Technology — 0.6% | ||||||||
|
Teladoc Health Inc.(a)(b) |
62,149 | 12,209,792 | ||||||
|
|
|
|||||||
| Life Sciences Tools & Services — 9.7% | ||||||||
|
10X Genomics Inc., Class A(a) |
33,740 | 4,619,006 | ||||||
|
Agilent Technologies Inc. |
160,718 | 16,407,701 | ||||||
|
Avantor Inc.(a) |
230,857 | 5,372,042 | ||||||
|
Bio-Rad Laboratories Inc., Class A(a)(b) |
11,127 | 6,525,095 | ||||||
|
Bio-Techne Corp. |
20,045 | 5,059,558 | ||||||
|
Bruker Corp. |
53,257 | 2,265,553 | ||||||
|
Charles River Laboratories International Inc.(a) |
25,836 | 5,882,857 | ||||||
|
Illumina Inc.(a) |
76,108 | 22,276,812 | ||||||
|
IQVIA Holdings Inc.(a) |
99,707 | 15,353,881 | ||||||
|
Mettler-Toledo International Inc.(a) |
12,492 | 12,465,892 | ||||||
|
PPD Inc.(a) |
56,221 | 1,848,546 | ||||||
|
PRA Health Sciences Inc.(a) |
33,334 | 3,248,065 | ||||||
|
Repligen Corp.(a) |
25,463 | 4,241,372 | ||||||
|
Syneos Health Inc.(a) |
36,357 | 1,929,830 | ||||||
|
Thermo Fisher Scientific Inc. |
206,216 | 97,564,914 | ||||||
|
Waters Corp.(a) |
32,232 | 7,181,934 | ||||||
|
|
|
|||||||
| 212,243,058 | ||||||||
| 28 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Healthcare ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
|
Pharmaceuticals — 26.7% |
|
|||||||
|
Bristol-Myers Squibb Co. |
1,174,949 | $ | 68,675,769 | |||||
|
Catalent Inc.(a) |
85,594 | 7,512,585 | ||||||
|
Elanco Animal Health Inc.(a) |
170,648 | 5,291,795 | ||||||
|
Eli Lilly & Co. |
413,835 | 53,988,914 | ||||||
|
Horizon Therapeutics PLC(a) |
110,233 | 8,259,759 | ||||||
|
Jazz Pharmaceuticals PLC(a) |
28,944 | 4,170,830 | ||||||
|
Johnson & Johnson |
1,372,460 | 188,177,991 | ||||||
|
Merck & Co. Inc. |
1,318,463 | 99,161,602 | ||||||
|
Mylan NV(a) |
269,833 | 3,923,372 | ||||||
|
Nektar Therapeutics(a)(b) |
92,720 | 1,468,685 | ||||||
|
Perrigo Co. PLC |
71,237 | 3,125,167 | ||||||
|
Pfizer Inc. |
2,896,734 | 102,776,122 | ||||||
|
Royalty Pharma PLC, Class A |
42,016 | 1,541,987 | ||||||
|
Zoetis Inc. |
247,688 | 39,270,933 | ||||||
|
|
|
|||||||
| 587,345,511 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
2,193,446,609 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 1.8% |
||||||||
|
BlackRock Cash Funds: Institutional,
|
38,013,755 | 38,040,365 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
|
Money Market Funds (continued) |
||||||||
|
BlackRock Cash Funds: Treasury,
|
2,427,000 | $ | 2,427,000 | |||||
|
|
|
|||||||
| 40,467,365 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.8% (Cost: $40,455,197) |
40,467,365 | |||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.7% (Cost: $2,103,017,229) |
2,233,913,974 | |||||||
|
Other Assets, Less Liabilities — (1.7)% |
(37,297,137 | ) | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 2,196,616,837 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 70,991,917 | $ | — | $ | (32,941,957 | )(a) | $ | 56,565 | $ | (66,160 | ) | $ | 38,040,365 | 38,013,755 | $ | 90,084 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
3,207,000 | — | (780,000 | )(a) | — | — | 2,427,000 | 2,427,000 | 2,900 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 56,565 | $ | (66,160 | ) | $ | 40,467,365 | $ | 92,984 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
(000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Health Care E-Mini Index |
29 | 12/18/20 | $ | 2,969 | $ | (170,849 | ) | |||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
29 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Healthcare ETF
|
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 170,849 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 582,871 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (634,123 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 5,326,937 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 2,193,446,609 | $ | — | $ | — | $ | 2,193,446,609 | ||||||||
|
Money Market Funds |
40,467,365 | — | — | 40,467,365 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 2,233,913,974 | $ | — | $ | — | $ | 2,233,913,974 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (170,849 | ) | $ | — | $ | — | $ | (170,849 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 30 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Technology ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
|
Communications Equipment — 2.9% |
|
|||||||
|
Arista Networks Inc.(a)(b) |
41,161 | $ | 8,598,533 | |||||
|
Ciena Corp.(a) |
116,012 | 4,569,713 | ||||||
|
Cisco Systems Inc. |
3,193,478 | 114,645,860 | ||||||
|
EchoStar Corp., Class A(a) |
38,117 | 882,790 | ||||||
|
F5 Networks Inc.(a) |
45,975 | 6,111,916 | ||||||
|
Juniper Networks Inc. |
250,191 | 4,933,767 | ||||||
|
Lumentum Holdings Inc.(a) |
56,554 | 4,676,450 | ||||||
|
Motorola Solutions Inc. |
127,984 | 20,229,151 | ||||||
|
Ubiquiti Inc. |
5,757 | 1,068,557 | ||||||
|
Viavi Solutions Inc.(a) |
172,135 | 2,125,867 | ||||||
|
|
|
|||||||
| 167,842,604 | ||||||||
|
Diversified Telecommunication Services — 0.3% |
|
|||||||
|
CenturyLink Inc. |
745,801 | 6,428,804 | ||||||
|
GCI Liberty Inc., Class A(a) |
76,751 | 6,234,484 | ||||||
|
Liberty Global PLC, Class A(a)(b) |
107,460 | 2,039,591 | ||||||
|
Liberty Global PLC, Class C, NVS(a) |
280,636 | 5,236,668 | ||||||
|
|
|
|||||||
| 19,939,547 | ||||||||
|
Electronic Equipment, Instruments & Components — 0.3% |
|
|||||||
|
CDW Corp./DE |
107,460 | 13,174,596 | ||||||
|
SYNNEX Corp.(b) |
31,095 | 4,093,346 | ||||||
|
|
|
|||||||
| 17,267,942 | ||||||||
|
Health Care Technology — 0.8% |
|
|||||||
|
Cerner Corp. |
230,645 | 16,165,908 | ||||||
|
Veeva Systems Inc., Class A(a) |
101,837 | 27,501,082 | ||||||
|
|
|
|||||||
| 43,666,990 | ||||||||
|
Household Durables — 0.2% |
|
|||||||
|
Garmin Ltd. |
112,328 | 11,684,358 | ||||||
|
|
|
|||||||
|
Interactive Media & Services — 12.9% |
|
|||||||
|
Alphabet Inc., Class A(a) |
124,616 | 201,393,164 | ||||||
|
Alphabet Inc., Class C, NVS(a) |
121,767 | 197,385,525 | ||||||
|
ANGI Homeservices Inc., Class A(a)(b) |
56,219 | 595,921 | ||||||
|
Cargurus Inc.(a)(b) |
64,870 | 1,292,859 | ||||||
|
Facebook Inc., Class A(a) |
975,784 | 256,738,528 | ||||||
|
IAC/InterActiveCorp.(a)(b) |
60,252 | 7,273,621 | ||||||
|
Match Group Inc.(a) |
196,016 | 22,890,749 | ||||||
|
Snap Inc., Class A, NVS(a)(b) |
676,541 | 26,648,950 | ||||||
|
Twitter Inc.(a) |
596,079 | 24,653,827 | ||||||
|
Zillow Group Inc., Class A(a) |
27,263 | 2,435,404 | ||||||
|
Zillow Group Inc., Class C, NVS(a)(b) |
107,738 | 9,547,742 | ||||||
|
|
|
|||||||
| 750,856,290 | ||||||||
|
Internet & Direct Marketing Retail — 0.7% |
|
|||||||
|
Chewy Inc., Class A(a)(b) |
54,177 | 3,337,303 | ||||||
|
eBay Inc. |
502,146 | 23,917,214 | ||||||
|
Etsy Inc.(a) |
90,153 | 10,961,703 | ||||||
|
Grubhub Inc.(a) |
69,435 | 5,135,413 | ||||||
|
|
|
|||||||
| 43,351,633 | ||||||||
|
IT Services — 4.5% |
|
|||||||
|
Akamai Technologies Inc.(a) |
122,574 | 11,659,239 | ||||||
|
Amdocs Ltd. |
100,801 | 5,683,160 | ||||||
|
Booz Allen Hamilton Holding Corp. |
104,157 | 8,176,325 | ||||||
|
CACI International Inc., Class A(a) |
18,949 | 3,951,435 | ||||||
|
Cognizant Technology Solutions Corp., Class A |
408,785 | 29,195,425 | ||||||
|
DXC Technology Co. |
191,598 | 3,529,235 | ||||||
|
EPAM Systems Inc.(a) |
42,205 | 13,039,235 | ||||||
|
Fastly Inc., Class A(a)(b) |
55,989 | 3,555,861 | ||||||
|
Gartner Inc.(a) |
67,333 | 8,086,693 | ||||||
| Security | Shares | Value | ||||||
|
IT Services (continued) |
|
|||||||
|
GoDaddy Inc., Class A(a)(b) |
125,584 | $ | 8,883,812 | |||||
|
International Business Machines Corp. |
671,809 | 75,014,193 | ||||||
|
KBR Inc. |
107,452 | 2,395,105 | ||||||
|
Leidos Holdings Inc. |
100,849 | 8,370,467 | ||||||
|
MongoDB Inc.(a) |
38,120 | 8,709,276 | ||||||
|
Okta Inc.(a) |
87,672 | 18,396,216 | ||||||
|
Perspecta Inc. |
103,072 | 1,848,081 | ||||||
|
Science Applications International Corp. |
44,100 | 3,367,917 | ||||||
|
Snowflake Inc., Class A(a) |
20,947 | 5,237,169 | ||||||
|
Twilio Inc., Class A(a) |
103,539 | 28,884,275 | ||||||
|
VeriSign Inc.(a) |
76,218 | 14,534,773 | ||||||
|
|
|
|||||||
| 262,517,892 | ||||||||
|
Semiconductors & Semiconductor Equipment — 19.8% |
|
|||||||
|
Advanced Micro Devices Inc.(a) |
885,648 | 66,680,438 | ||||||
|
Analog Devices Inc. |
278,746 | 33,039,763 | ||||||
|
Applied Materials Inc. |
689,257 | 40,824,692 | ||||||
|
Broadcom Inc. |
303,388 | 106,073,546 | ||||||
|
Cirrus Logic Inc.(a) |
44,086 | 3,036,203 | ||||||
|
Cree Inc.(a) |
83,039 | 5,281,280 | ||||||
|
Enphase Energy Inc.(a) |
95,260 | 9,344,053 | ||||||
|
Entegris Inc. |
101,638 | 7,599,473 | ||||||
|
Inphi Corp.(a) |
39,157 | 5,472,582 | ||||||
|
Intel Corp. |
3,208,245 | 142,061,089 | ||||||
|
KLA Corp. |
117,400 | 23,148,932 | ||||||
|
Lam Research Corp. |
109,865 | 37,582,619 | ||||||
|
Marvell Technology Group Ltd. |
502,368 | 18,843,824 | ||||||
|
Maxim Integrated Products Inc. |
201,315 | 14,021,590 | ||||||
|
Microchip Technology Inc. |
190,588 | 20,026,987 | ||||||
|
Micron Technology Inc.(a) |
837,571 | 42,163,324 | ||||||
|
MKS Instruments Inc. |
41,431 | 4,490,706 | ||||||
|
Monolithic Power Systems Inc. |
31,967 | 10,216,653 | ||||||
|
NVIDIA Corp.(b) |
465,434 | 233,349,990 | ||||||
|
NXP Semiconductors NV |
210,694 | 28,468,973 | ||||||
|
ON Semiconductor Corp.(a) |
309,593 | 7,767,688 | ||||||
|
Power Integrations Inc. |
44,589 | 2,684,704 | ||||||
|
Qorvo Inc.(a) |
86,016 | 10,954,998 | ||||||
|
QUALCOMM Inc. |
851,107 | 104,992,560 | ||||||
|
Semtech Corp.(a) |
49,199 | 2,700,533 | ||||||
|
Silicon Laboratories Inc.(a)(b) |
32,997 | 3,380,873 | ||||||
|
Skyworks Solutions Inc. |
125,981 | 17,799,856 | ||||||
|
SolarEdge Technologies Inc.(a)(b) |
37,890 | 9,763,874 | ||||||
|
Teradyne Inc. |
125,197 | 10,998,557 | ||||||
|
Texas Instruments Inc. |
690,941 | 99,903,159 | ||||||
|
Universal Display Corp. |
32,452 | 6,435,556 | ||||||
|
Xilinx Inc. |
184,362 | 21,881,926 | ||||||
|
|
|
|||||||
| 1,150,991,001 | ||||||||
|
Software — 36.6% |
|
|||||||
|
ACI Worldwide Inc.(a)(b) |
87,555 | 2,553,979 | ||||||
|
Adobe Inc.(a) |
361,835 | 161,776,428 | ||||||
|
Alteryx Inc., Class A(a)(b) |
40,530 | 5,080,436 | ||||||
|
Anaplan Inc.(a) |
103,503 | 5,728,891 | ||||||
|
ANSYS Inc.(a) |
64,669 | 19,683,304 | ||||||
|
Aspen Technology Inc.(a) |
51,044 | 5,605,142 | ||||||
|
Autodesk Inc.(a) |
165,314 | 38,938,060 | ||||||
|
Avalara Inc.(a) |
62,809 | 9,361,681 | ||||||
|
Bill.Com Holdings Inc.(a)(b) |
44,272 | 4,427,200 | ||||||
|
Blackbaud Inc. |
37,468 | 1,848,671 | ||||||
|
Cadence Design Systems Inc.(a) |
210,193 | 22,988,808 | ||||||
|
CDK Global Inc. |
91,765 | 3,955,072 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
31 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Technology ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Software (continued) |
|
|||||||
|
Ceridian HCM Holding Inc.(a) |
97,670 | $ | 8,421,107 | |||||
|
Citrix Systems Inc. |
93,132 | 10,549,062 | ||||||
|
Cloudflare Inc., Class A(a) |
108,654 | 5,646,748 | ||||||
|
Coupa Software Inc.(a) |
50,560 | 13,534,912 | ||||||
|
Crowdstrike Holdings Inc., Class A(a) |
113,904 | 14,105,871 | ||||||
|
Datadog Inc., Class A(a) |
133,440 | 12,109,680 | ||||||
|
DocuSign Inc.(a) |
138,449 | 28,001,310 | ||||||
|
Dropbox Inc., Class A(a)(b) |
222,633 | 4,065,279 | ||||||
|
Dynatrace Inc.(a) |
137,949 | 4,870,979 | ||||||
|
Elastic NV(a) |
44,857 | 4,548,948 | ||||||
|
Fair Isaac Corp.(a) |
21,899 | 8,572,364 | ||||||
|
FireEye Inc.(a)(b) |
168,266 | 2,328,801 | ||||||
|
Five9 Inc.(a)(b) |
49,393 | 7,493,906 | ||||||
|
Fortinet Inc.(a) |
101,340 | 11,184,896 | ||||||
|
Guidewire Software Inc.(a) |
62,588 | 6,015,333 | ||||||
|
HubSpot Inc.(a) |
32,238 | 9,351,277 | ||||||
|
Intuit Inc. |
197,494 | 62,147,412 | ||||||
|
j2 Global Inc.(a) |
33,385 | 2,266,174 | ||||||
|
Manhattan Associates Inc.(a)(b) |
47,949 | 4,099,640 | ||||||
|
Microsoft Corp. |
4,969,432 | 1,006,160,897 | ||||||
|
New Relic Inc.(a) |
39,453 | 2,393,219 | ||||||
|
NortonLifeLock Inc. |
444,929 | 9,152,190 | ||||||
|
Nuance Communications Inc.(a)(b) |
212,402 | 6,777,748 | ||||||
|
Nutanix Inc., Class A(a) |
139,883 | 3,404,752 | ||||||
|
Oracle Corp. |
1,458,359 | 81,828,523 | ||||||
|
Palo Alto Networks Inc.(a) |
72,861 | 16,116,125 | ||||||
|
Paycom Software Inc.(a) |
36,866 | 13,422,542 | ||||||
|
Paylocity Holding Corp.(a) |
28,119 | 5,216,637 | ||||||
|
Pegasystems Inc.(b) |
29,842 | 3,458,091 | ||||||
|
Pluralsight Inc., Class A(a) |
76,819 | 1,206,058 | ||||||
|
Proofpoint Inc.(a)(b) |
43,296 | 4,145,159 | ||||||
|
PTC Inc.(a) |
78,622 | 6,594,813 | ||||||
|
RealPage Inc.(a) |
67,136 | 3,738,804 | ||||||
|
RingCentral Inc., Class A(a) |
58,948 | 15,228,626 | ||||||
|
salesforce.com Inc.(a) |
686,459 | 159,443,832 | ||||||
|
ServiceNow Inc.(a) |
144,686 | 71,991,413 | ||||||
|
Slack Technologies Inc., Class A(a)(b) |
327,037 | 8,365,606 | ||||||
|
Smartsheet Inc., Class A(a) |
85,039 | 4,239,194 | ||||||
|
SolarWinds Corp.(a) |
54,439 | 1,112,189 | ||||||
|
Splunk Inc.(a) |
119,876 | 23,740,243 | ||||||
|
SS&C Technologies Holdings Inc. |
169,556 | 10,041,106 | ||||||
|
Synopsys Inc.(a) |
114,601 | 24,508,570 | ||||||
|
Trade Desk Inc. (The), Class A(a)(b) |
31,473 | 17,827,881 | ||||||
|
Tyler Technologies Inc.(a) |
30,300 | 11,646,714 | ||||||
|
Verint Systems Inc.(a) |
48,425 | 2,349,581 | ||||||
| Security | Shares | Value | ||||||
|
Software (continued) |
|
|||||||
|
VMware Inc., Class A(a)(b) |
60,955 | $ | 7,846,737 | |||||
|
Workday Inc., Class A(a) |
131,230 | 27,574,048 | ||||||
|
Zendesk Inc.(a) |
86,813 | 9,631,034 | ||||||
|
Zoom Video Communications Inc., Class A(a) |
137,372 | 63,316,129 | ||||||
|
Zscaler Inc.(a) |
53,966 | 7,325,884 | ||||||
|
|
|
|||||||
| 2,131,065,716 | ||||||||
|
Technology Hardware, Storage & Peripherals — 20.9% |
|
|||||||
|
Apple Inc. |
10,556,842 | 1,149,217,820 | ||||||
|
Dell Technologies Inc., Class C(a) |
177,256 | 10,681,447 | ||||||
|
Hewlett Packard Enterprise Co. |
970,297 | 8,383,366 | ||||||
|
HP Inc. |
1,036,076 | 18,607,925 | ||||||
|
NetApp Inc. |
166,939 | 7,326,953 | ||||||
|
Pure Storage Inc., Class A(a)(b) |
180,602 | 2,907,692 | ||||||
|
Seagate Technology PLC |
168,927 | 8,078,089 | ||||||
|
Western Digital Corp. |
227,567 | 8,586,103 | ||||||
|
Xerox Holdings Corp. |
135,259 | 2,350,801 | ||||||
|
|
|
|||||||
| 1,216,140,196 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
5,815,324,169 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
|
Money Market Funds — 2.4% |
|
|||||||
|
BlackRock Cash Funds: Institutional,
|
133,960,104 | 134,053,876 | ||||||
|
BlackRock Cash Funds: Treasury,
|
7,090,000 | 7,090,000 | ||||||
|
|
|
|||||||
| 141,143,876 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 2.4%
|
|
141,143,876 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 102.3%
|
|
5,956,468,045 | ||||||
|
Other Assets, Less Liabilities — (2.3)% |
|
(135,098,364 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 5,821,369,681 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
| 32 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Technology ETF
|
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at
|
Income |
Capital Gain
Distributions
|
|
||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 122,323,942 | $ | 11,763,567 | (a) | $ | — | $ | 68,702 | $ | (102,335 | ) | $ | 134,053,876 | 133,960,104 | $ | 295,438(b | ) | $ | — | ||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
10,244,000 | — | (3,154,000 | )(a) | — | — | 7,090,000 | 7,090,000 | 7,575 | — | ||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
| $ | 68,702 | $ | (102,335 | ) | $ | 141,143,876 | $ | 303,013 | $ | — | ||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Communication Services E-Mini Index |
11 | 12/18/20 | $ | 851 | $ | (5,034 | ) | |||||||||
|
S&P Select Sector Technology E-Mini Index |
37 | 12/18/20 | 4,125 | (113,372 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (118,406 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 118,406 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 3,157,856 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (731,459 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,710,704 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
|
S C H E D U L E O F I N V E S T M E N T S |
33 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Technology ETF
|
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 5,815,324,169 | $ | — | $ | — | $ | 5,815,324,169 | ||||||||
|
Money Market Funds |
141,143,876 | — | — | 141,143,876 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 5,956,468,045 | $ | — | $ | — | $ | 5,956,468,045 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (118,406 | ) | $ | — | $ | — | $ | (118,406 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 34 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Utilities ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
|
Electric Utilities — 60.3% |
|
|||||||
|
ALLETE Inc. |
44,943 | $ | 2,318,160 | |||||
|
Alliant Energy Corp. |
216,618 | 11,974,643 | ||||||
|
American Electric Power Co. Inc. |
430,518 | 38,716,484 | ||||||
|
Avangrid Inc. |
48,184 | 2,377,399 | ||||||
|
Duke Energy Corp. |
638,141 | 58,779,168 | ||||||
|
Edison International |
328,185 | 18,391,487 | ||||||
|
Entergy Corp. |
173,724 | 17,584,343 | ||||||
|
Evergy Inc. |
196,820 | 10,864,464 | ||||||
|
Eversource Energy |
297,336 | 25,948,513 | ||||||
|
Exelon Corp. |
845,586 | 33,730,426 | ||||||
|
FirstEnergy Corp. |
470,394 | 13,980,110 | ||||||
|
Hawaiian Electric Industries Inc. |
94,824 | 3,132,985 | ||||||
|
IDACORP Inc. |
43,810 | 3,843,451 | ||||||
|
NextEra Energy Inc. |
1,699,488 | 124,419,516 | ||||||
|
NRG Energy Inc. |
211,841 | 6,698,412 | ||||||
|
PG&E Corp.(a) |
1,274,680 | 12,185,941 | ||||||
|
Pinnacle West Capital Corp. |
97,667 | 7,966,697 | ||||||
|
PNM Resources Inc. |
69,190 | 3,459,500 | ||||||
|
Portland General Electric Co. |
77,539 | 3,047,283 | ||||||
|
PPL Corp. |
667,081 | 18,344,727 | ||||||
|
Southern Co. (The) |
916,415 | 52,648,042 | ||||||
|
Xcel Energy Inc. |
455,844 | 31,922,755 | ||||||
|
|
|
|||||||
| 502,334,506 | ||||||||
|
Gas Utilities — 3.6% |
|
|||||||
|
Atmos Energy Corp. |
107,035 | 9,811,899 | ||||||
|
National Fuel Gas Co. |
78,991 | 3,156,480 | ||||||
|
New Jersey Resources Corp. |
83,102 | 2,424,916 | ||||||
|
ONE Gas Inc. |
45,959 | 3,173,009 | ||||||
|
Southwest Gas Holdings Inc. |
48,563 | 3,191,561 | ||||||
|
Spire Inc. |
44,598 | 2,499,272 | ||||||
|
UGI Corp. |
180,762 | 5,845,843 | ||||||
|
|
|
|||||||
| 30,102,980 | ||||||||
|
Independent Power and Renewable Electricity Producers — 2.3% |
|
|||||||
|
AES Corp. (The) |
577,140 | 11,254,230 | ||||||
|
Vistra Corp. |
424,119 | 7,366,947 | ||||||
|
|
|
|||||||
| 18,621,177 | ||||||||
|
Multi-Utilities — 29.9% |
|
|||||||
|
Ameren Corp. |
214,393 | 17,391,560 | ||||||
| Security | Shares | Value | ||||||
|
Multi-Utilities (continued) |
|
|||||||
|
Avista Corp. |
58,831 | $ | 1,954,366 | |||||
|
Black Hills Corp. |
54,500 | 3,087,970 | ||||||
|
CenterPoint Energy Inc. |
472,745 | 9,989,102 | ||||||
|
CMS Energy Corp. |
248,408 | 15,731,679 | ||||||
|
Consolidated Edison Inc. |
290,246 | 22,781,409 | ||||||
|
Dominion Energy Inc. |
728,994 | 58,567,378 | ||||||
|
DTE Energy Co. |
167,165 | 20,631,504 | ||||||
|
MDU Resources Group Inc.
|
174,067 | 4,135,832 | ||||||
|
NiSource Inc. |
332,353 | 7,634,148 | ||||||
|
NorthWestern Corp. |
43,810 | 2,283,815 | ||||||
|
Public Service Enterprise Group Inc. |
438,849 | 25,519,069 | ||||||
|
Sempra Energy |
250,993 | 31,464,483 | ||||||
|
WEC Energy Group Inc. |
273,706 | 27,521,138 | ||||||
|
|
|
|||||||
| 248,693,453 | ||||||||
|
Water Utilities — 3.8% |
|
|||||||
|
American Water Works Co. Inc. |
157,232 | 23,664,988 | ||||||
|
Essential Utilities Inc. |
193,577 | 7,975,373 | ||||||
|
|
|
|||||||
| 31,640,361 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
|
831,392,477 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
|
Money Market Funds — 0.1% |
|
|||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(c) |
1,032,000 | 1,032,000 | ||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.1%
|
|
1,032,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.0%
|
|
832,424,477 | ||||||
|
Other Assets, Less Liabilities — 0.0% |
|
414,796 | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 832,839,273 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
Annualized 7-day yield as of period-end. |
|
S C H E D U L E O F I N V E S T M E N T S |
35 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Utilities ETF
|
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||||||
|
|
Affiliated Issuer |
|
Value at
04/30/20 |
|
|
Purchases
at Cost |
|
|
Proceeds
from Sales |
|
|
Net Realized
Gain (Loss) |
|
|
Change in
Unrealized Appreciation (Depreciation) |
|
|
Value at
10/31/20 |
|
|
Shares
Held at 10/31/20 |
|
Income |
|
Capital
Gain Distributions from Underlying Funds |
|
||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares(a) |
$ | 2,148,971 | $ | — | $ | (2,149,176 | )(b) | $ | 4,454 | $ | (4,249 | ) | $ | — | — | $ | 3,157 | (c) | $ | — | ||||||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
2,652,000 | — | (1,620,000 | )(b) | — | — | 1,032,000 | 1,032,000 | 1,069 | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| $ | 4,454 | $ | (4,249 | ) | $ | 1,032,000 | $ | 4,226 | $ | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| (a) |
As of period end, the entity is no longer held. |
| (b) |
Represents net amount purchased (sold). |
| (c) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Utilities E-Mini Index |
21 | 12/18/20 | $ | 1,319 | $ | 56,015 | ||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 56,015 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 585,855 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (211,403 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,688,353 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
| 36 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Utilities ETF
|
Fair Value Measurements (continued)
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 831,392,477 | $ | — | $ | — | $ | 831,392,477 | ||||||||
|
Money Market Funds |
1,032,000 | — | — | 1,032,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 832,424,477 | $ | — | $ | — | $ | 832,424,477 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 56,015 | $ | — | $ | — | $ | 56,015 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
37 |
Statements of Assets and Liabilities (unaudited)
October 31, 2020
See notes to financial statements.
| 38 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Assets and Liabilities (unaudited) (continued)
October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
39 |
Statements of Operations (unaudited)
Six Months Ended October 31, 2020
See notes to financial statements.
| 40 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Operations (unaudited) (continued)
Six Months Ended October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
41 |
Statements of Changes in Net Assets
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 42 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
43 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 44 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
(For a share outstanding throughout each period)
| iShares Dow Jones U.S. ETF | ||||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 143.00 | $ | 146.88 | $ | 132.49 | $ | 119.45 | $ | 103.06 | $ | 105.32 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
1.22 | 2.55 | 2.40 | 2.19 | 2.01 | 1.92 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
19.75 | (3.49 | ) | 14.46 | 13.03 | 16.40 | (2.11 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
20.97 | (0.94 | ) | 16.86 | 15.22 | 18.41 | (0.19 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(1.22 | ) | (2.94 | ) | (2.47 | ) | (2.18 | ) | (2.02 | ) | (2.07 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(1.22 | ) | (2.94 | ) | (2.47 | ) | (2.18 | ) | (2.02 | ) | (2.07 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 162.75 | $ | 143.00 | $ | 146.88 | $ | 132.49 | $ | 119.45 | $ | 103.06 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
14.70 | %(d) | (0.63 | )% | 12.89 | % | 12.81 | % | 18.04 | % | (0.14 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.20 | %(e) | 0.20 | % | 0.20 | % | 0.20 | % | 0.20 | % | 0.20 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
1.52 | %(e) | 1.72 | % | 1.74 | % | 1.70 | % | 1.82 | % | 1.88 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,245,009 | $ | 1,158,276 | $ | 1,241,141 | $ | 1,126,170 | $ | 1,110,872 | $ | 917,234 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
3 | %(d) | 4 | % | 5 | % | 4 | % | 4 | % | 4 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
45 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Transportation Average ETF | ||||||||||||||||||||||||||||
|
Six Months Ended 10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 149.76 | $ | 195.07 | $ | 187.76 | $ | 163.83 | $ | 141.18 | $ | 153.92 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
0.82 | 2.55 | 2.12 | 1.91 | 1.54 | 1.50 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
46.94 | (45.09 | ) | 7.34 | 24.02 | 22.75 | (12.63 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
47.76 | (42.54 | ) | 9.46 | 25.93 | 24.29 | (11.13 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(0.83 | ) | (2.77 | ) | (2.15 | ) | (2.00 | ) | (1.64 | ) | (1.61 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(0.83 | ) | (2.77 | ) | (2.15 | ) | (2.00 | ) | (1.64 | ) | (1.61 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 196.69 | $ | 149.76 | $ | 195.07 | $ | 187.76 | $ | 163.83 | $ | 141.18 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
31.96 | %(d) | (21.92 | )% | 5.12 | % | 15.88 | % | 17.32 | % | (7.24 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.42 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
0.89 | %(e) | 1.40 | % | 1.11 | % | 1.07 | % | 0.99 | % | 1.05 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,160,491 | $ | 456,765 | $ | 575,444 | $ | 807,349 | $ | 966,598 | $ | 564,723 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
39 | %(d) | 35 | % | 17 | % | 5 | % | 5 | % | 11 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 46 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Energy ETF | ||||||||||||||||||||||||||||
|
Six Months Ended
(unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 20.06 | $ | 35.96 | $ | 40.47 | $ | 37.27 | $ | 37.91 | $ | 46.62 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
0.53 | 1.02 | 0.89 | 1.07 | 0.84 | 1.06 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
(4.72 | ) | (14.81 | ) | (4.43 | ) | 3.25 | (0.62 | ) | (8.66 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
(4.19 | ) | (13.79 | ) | (3.54 | ) | 4.32 | 0.22 | (7.60 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(0.49 | ) | (2.11 | ) | (0.97 | ) | (1.12 | ) | (0.86 | ) | (1.11 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(0.49 | ) | (2.11 | ) | (0.97 | ) | (1.12 | ) | (0.86 | ) | (1.11 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 15.38 | $ | 20.06 | $ | 35.96 | $ | 40.47 | $ | 37.27 | $ | 37.91 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
(21.22 | )%(d) | (39.91 | )% | (8.83 | )% | 11.92 | % | 0.52 | % | (16.20 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.42 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
5.54 | %(e) | 3.42 | % | 2.33 | % | 2.87 | % | 2.17 | % | 2.80 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 359,871 | $ | 459,456 | $ | 789,226 | $ | 1,088,740 | $ | 1,159,125 | $ | 1,249,003 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
9 | %(d) | 12 | % | 6 | % | 6 | % | 18 | % | 15 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
47 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Healthcare ETF | ||||||||||||||||||||||||||||
|
Six Months Ended 10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 212.48 | $ | 188.15 | $ | 173.95 | $ | 158.62 | $ | 144.67 | $ | 151.70 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
1.30 | 2.49 | 2.26 | 1.99 | 1.81 | 1.70 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
7.37 | 24.38 | 15.50 | 15.31 | 14.07 | (5.63 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
8.67 | 26.87 | 17.76 | 17.30 | 15.88 | (3.93 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(1.49 | ) | (2.54 | ) | (3.56 | ) | (1.97 | ) | (1.93 | ) | (3.10 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(1.49 | ) | (2.54 | ) | (3.56 | ) | (1.97 | ) | (1.93 | ) | (3.10 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 219.66 | $ | 212.48 | $ | 188.15 | $ | 173.95 | $ | 158.62 | $ | 144.67 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
4.10 | %(d) | 14.44 | % | 10.27 | % | 10.93 | % | 11.06 | % | (2.64 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.43 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
1.16 | %(e) | 1.25 | % | 1.19 | % | 1.16 | % | 1.21 | % | 1.13 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 2,196,617 | $ | 2,432,933 | $ | 2,097,818 | $ | 1,800,336 | $ | 1,911,386 | $ | 1,808,437 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
5 | %(d) | 5 | % | 6 | % | 7 | % | 6 | % | 7 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 48 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Technology ETF | ||||||||||||||||||||||||||||
|
Six Months Ended
(unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended
04/30/18 |
Year Ended 04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 234.32 | $ | 203.40 | $ | 167.97 | $ | 138.18 | $ | 102.30 | $ | 107.28 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
0.82 | 1.91 | 1.59 | 1.26 | 1.33 | 1.30 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
58.25 | 31.00 | 35.34 | 29.88 | 35.87 | (4.97 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
59.07 | 32.91 | 36.93 | 31.14 | 37.20 | (3.67 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(0.86 | ) | (1.99 | ) | (1.50 | ) | (1.35 | ) | (1.32 | ) | (1.31 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(0.86 | ) | (1.99 | ) | (1.50 | ) | (1.35 | ) | (1.32 | ) | (1.31 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 292.53 | $ | 234.32 | $ | 203.40 | $ | 167.97 | $ | 138.18 | $ | 102.30 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
25.25 | %(d) | 16.34 | % | 22.10 | % | 22.62 | % | 36.57 | % | (3.45 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
0.58 | %(e) | 0.89 | % | 0.87 | % | 0.80 | % | 1.11 | % | 1.24 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 5,821,370 | $ | 4,862,141 | $ | 4,271,433 | $ | 4,031,372 | $ | 3,392,234 | $ | 2,393,714 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
7 | %(d) | 16 | % | 19 | % | 15 | % | 4 | % | 8 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
49 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Utilities ETF | ||||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 142.39 | $ | 148.71 | $ | 130.43 | $ | 129.30 | $ | 121.09 | $ | 111.09 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
2.29 | 4.20 | 4.03 | 3.79 | 3.69 | 3.37 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
10.41 | (6.12 | ) | 18.12 | 0.84 | 8.46 | 11.18 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
12.70 | (1.92 | ) | 22.15 | 4.63 | 12.15 | 14.55 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(2.28 | ) | (4.40 | ) | (3.87 | ) | (3.50 | ) | (3.94 | ) | (4.55 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(2.28 | ) | (4.40 | ) | (3.87 | ) | (3.50 | ) | (3.94 | ) | (4.55 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 152.81 | $ | 142.39 | $ | 148.71 | $ | 130.43 | $ | 129.30 | $ | 121.09 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
9.05 | %(d) | (1.39 | )% | 17.29 | % | 3.59 | % | 10.16 | % | 13.61 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.43 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
3.10 | %(e) | 2.70 | % | 2.94 | % | 2.86 | % | 2.96 | % | 3.02 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 832,839 | $ | 875,673 | $ | 810,455 | $ | 606,486 | $ | 801,673 | $ | 1,065,624 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
3 | %(d) | 4 | % | 6 | % | 5 | % | 9 | % | 6 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 50 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited)
| 1. |
ORGANIZATION |
iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.
These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):
| iShares ETF |
Diversification Classification |
|||
|
Dow Jones U.S. |
Diversified | |||
|
Transportation Average |
Non-diversified | |||
|
U.S. Energy |
Non-diversified | |||
|
U.S. Healthcare |
Non-diversified | |||
|
U.S. Technology |
Non-diversified | |||
|
U.S. Utilities |
Non-diversified | |||
| 2. |
SIGNIFICANT ACCOUNTING POLICIES |
The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:
Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value.
Foreign Taxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its statement of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “Other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2020, if any, are disclosed in the statement of assets and liabilities.
Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.
In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.
Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.
Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.
| 3. |
INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS |
Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. A fund determines the fair value of its financial instruments using various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
51 |
Notes to Financial Statements (unaudited) (continued)
Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:
| • |
Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price. |
| • |
Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV. |
| • |
Futures contracts are valued based on that day’s last reported settlement price on the exchange where the contract is traded. |
If events (e.g., a market closure, market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and the cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.
Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.
Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:
| • |
Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access; |
| • |
Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs); and |
| • |
Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments). |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgement exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.
| 4. |
SECURITIES AND OTHER INVESTMENTS |
Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.
As of October 31, 2020, any securities on loan were collateralized by cash and/or U.S. government obligations. Cash collateral received was invested in money market funds managed by BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, or its affiliates and is disclosed in the schedules of investments. Any non-cash collateral received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan for each Fund, if any, are also disclosed in its schedule of investments. The market value of any securities on loan as of October 31, 2020 and the value of the related cash collateral are disclosed in the statements of assets and liabilities.
Securities lending transactions are entered into by a fund under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value of the collateral is typically greater than the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the fund can reinvest cash collateral received in connection with loaned securities.
| 52 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA as of October 31, 2020:
|
|
||||||||||||||||
|
iShares ETF and Counterparty |
|
Market Value of
Securities on Loan |
|
|
Cash Collateral
Received |
(a) |
|
Non-Cash Collateral
Received |
|
Net Amount | ||||||
|
|
||||||||||||||||
|
Dow Jones U.S. |
||||||||||||||||
|
Barclays Bank PLC |
$ | 796,193 | $ | 796,193 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
373,140 | 373,140 | — | — | ||||||||||||
|
BNP Paribas Securities Corp. |
801,084 | 801,084 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
566,278 | 566,278 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
144,290 | 144,290 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
311,356 | 305,473 | — | (5,883 | )(b) | |||||||||||
|
HSBC Bank PLC |
1,085,262 | 1,085,262 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
950,520 | 950,520 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
1,931,465 | 1,931,465 | — | — | ||||||||||||
|
RBC Capital Markets LLC |
186,848 | 186,848 | — | — | ||||||||||||
|
SG Americas Securities LLC |
49,757 | 49,757 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
12,476 | 12,476 | — | — | ||||||||||||
|
TD Prime Services LLC |
117,498 | 117,292 | — | (206 | )(b) | |||||||||||
|
UBS AG |
6,537 | 6,537 | — | — | ||||||||||||
|
UBS Securities LLC |
347,484 | 347,484 | — | — | ||||||||||||
|
Wells Fargo Securities LLC |
844,014 | 844,014 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 8,524,202 | 8,518,113 | — | (6,089 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Transportation Average |
||||||||||||||||
|
Barclays Bank PLC |
$ | 4,737,014 | $ | 4,737,014 | $ | — | $ | — | ||||||||
|
BofA Securities, Inc. |
3,008,399 | 3,008,399 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
2,590,136 | 2,590,136 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
2,094,750 | 2,063,788 | — | (30,962 | )(b) | |||||||||||
|
HSBC Bank PLC |
16,172 | 16,172 | — | — | ||||||||||||
|
Jefferies LLC |
948 | 948 | — | — | ||||||||||||
|
National Financial Services LLC |
3,508,414 | 3,508,414 | — | — | ||||||||||||
|
UBS AG |
1,185,100 | 1,185,100 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 17,140,933 | 17,109,971 | — | (30,962 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Energy |
||||||||||||||||
|
Jefferies LLC |
$ | 116,172 | $ | 113,530 | — | $ | (2,642 | )(b) | ||||||||
|
RBC Capital Markets LLC |
105,070 | 105,070 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 221,242 | 218,600 | — | (2,642 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Healthcare |
||||||||||||||||
|
Barclays Capital Inc. |
$ | 58,642 | $ | 58,000 | — | $ | (642 | )(b) | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
370,600 | 370,600 | — | — | ||||||||||||
|
Deutsche Bank Securities Inc. |
20,039 | 20,039 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
1,054,469 | 1,054,469 | — | — | ||||||||||||
|
Jefferies LLC |
20,628 | 20,628 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
1,222,748 | 1,222,748 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
7,564,019 | 7,558,213 | — | (5,806 | )(b) | |||||||||||
|
National Financial Services LLC |
220,080 | 220,080 | — | — | ||||||||||||
|
TD Prime Services LLC |
2,833,602 | 2,817,021 | — | (16,581 | )(b) | |||||||||||
|
UBS AG |
5,737,752 | 5,737,752 | — | — | ||||||||||||
|
UBS Securities LLC |
8,887,409 | 8,887,409 | — | — | ||||||||||||
|
Wells Fargo Securities LLC |
8,298,470 | 8,298,470 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 36,288,458 | 36,265,429 | — | (23,029 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
53 |
Notes to Financial Statements (unaudited) (continued)
|
|
||||||||||||||||
|
iShares ETF and Counterparty |
|
Market Value of
Securities on Loan |
|
|
Cash Collateral
Received |
(a) |
|
Non-Cash Collateral
Received |
|
Net Amount | ||||||
|
|
||||||||||||||||
|
U.S. Technology |
||||||||||||||||
|
Barclays Bank PLC |
$ | 10,702,969 | $ | 10,702,969 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
15,920,428 | 15,920,428 | — | — | ||||||||||||
|
BNP Paribas Securities Corp. |
59,473 | 59,473 | — | — | ||||||||||||
|
BofA Securities, Inc. |
280,260 | 280,260 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
18,585,397 | 18,585,397 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
190,895 | 190,895 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
1,003,476 | 1,003,476 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
7,723,143 | 7,723,143 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
22,286,226 | 22,286,226 | — | — | ||||||||||||
|
SG Americas Securities LLC |
47,478,792 | 47,478,792 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
552,352 | 552,352 | — | — | ||||||||||||
|
UBS AG |
5,184 | 5,184 | — | — | ||||||||||||
|
UBS Securities LLC |
375,683 | 375,683 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 125,164,278 | 125,164,278 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s statement of assets and liabilities. |
| (b) |
Additional collateral is delivered to the Fund on the next business day in accordance with the MSLA. The net amount would be subject to the borrower default indemnity in the event of default by a counterparty. |
The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.
| 5. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: Each Fund’s use of futures contracts is generally limited to cash equitization. This involves the use of available cash to invest in index futures contracts in order to gain exposure to the equity markets represented in or by the Fund’s underlying index and is intended to allow the Fund to better track its underlying index. Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).
Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the statement of assets and liabilities.
Securities deposited as initial margin are designated in the schedule of investments and cash deposited, if any, are shown as cash pledged for futures contracts in the statement of assets and liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the statement of assets and liabilities. When the contract is closed, a realized gain or loss is recorded in the statement of operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.
| 6. |
INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES |
Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).
For its investment advisory services to the iShares Dow Jones U.S. ETF, BFA is entitled to an annual investment advisory fee of 0.20%, accrued daily and paid monthly by the Fund, based on the average daily net assets of the Fund.
For its investment advisory services to each of the iShares Transportation Average, iShares U.S. Energy, iShares U.S. Healthcare, iShares U.S. Technology and iShares U.S. Utilities ETFs, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on each Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:
| 54 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| Aggregate Average Daily Net Assets | Investment Advisory Fee | |||
|
First $10 billion |
0.48 | % | ||
|
Over $10 billion, up to and including $20 billion |
0.43 | |||
|
Over $20 billion, up to and including $30 billion |
0.38 | |||
|
Over $30 billion, up to and including $40 billion |
0.34 | |||
|
Over $40 billion, up to and including $50 billion |
0.33 | |||
|
Over $50 billion |
0.31 | |||
Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.
Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.
Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.
Pursuant to the current securities lending agreement, each Fund retains 75% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in that calendar year exceeds a specified threshold, each Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 80% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its statement of operations. For the six months ended October 31, 2020, the Funds paid BTC the following amounts for securities lending agent services:
| iShares ETF |
Fees Paid to BTC |
|||
|
Dow Jones U.S. |
$ | 26,230 | ||
|
Transportation Average |
50,936 | |||
|
U.S. Energy |
10,966 | |||
|
U.S. Healthcare |
36,937 | |||
|
U.S. Technology |
116,438 | |||
|
U.S. Utilities |
1,292 | |||
Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.
Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.
For the six months ended October 31, 2020, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:
| iShares ETF | Purchases | Sales |
Net Realized Gain (Loss) |
|||||||||
|
Dow Jones U.S. |
$ | 6,083,685 | $ | 4,083,748 | $ | (1,718,932 | ) | |||||
|
U.S. Energy |
3,619,402 | 1,801,210 | (1,418,321 | ) | ||||||||
|
U.S. Healthcare |
22,472,351 | 16,179,094 | (2,842,425 | ) | ||||||||
|
U.S. Technology |
127,752,148 | 147,113,649 | (13,755,519 | ) | ||||||||
|
U.S. Utilities |
5,289,765 | 7,293,381 | (3,166,785 | ) | ||||||||
Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends – affiliated in the statement of operations.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
55 |
Notes to Financial Statements (unaudited) (continued)
A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.
| 7. |
PURCHASES AND SALES |
For the six months ended October 31, 2020, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
| iShares ETF | Purchases | Sales | ||||||
|
Dow Jones U.S. |
$ | 41,519,823 | $ | 40,337,750 | ||||
|
Transportation Average |
298,977,733 | 300,619,749 | ||||||
|
U.S. Energy |
37,669,357 | 36,953,955 | ||||||
|
U.S. Healthcare |
119,775,788 | 121,026,337 | ||||||
|
U.S. Technology |
431,219,428 | 425,558,178 | ||||||
|
U.S. Utilities |
29,676,720 | 27,685,807 | ||||||
For the six months ended October 31, 2020, purchases and sales related to in-kind transactions were as follows:
| iShares ETF |
In-kind
Purchases |
In-kind Sales | ||||||
|
Dow Jones U.S. |
$ | — | $ | 71,667,081 | ||||
|
Transportation Average |
990,231,653 | 435,653,218 | ||||||
|
U.S. Energy |
185,204,149 | 176,038,910 | ||||||
|
U.S. Healthcare |
297,357,975 | 621,797,169 | ||||||
|
U.S. Technology |
663,806,086 | 924,012,645 | ||||||
|
U.S. Utilities |
67,149,985 | 166,392,008 | ||||||
| 8. |
INCOME TAX INFORMATION |
Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.
Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2020, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.
As of April 30, 2020, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
| iShares ETF | Non-Expiring | |||
|
Dow Jones U.S. |
$ | 10,893,306 | ||
|
Transportation Average |
23,150,875 | |||
|
U.S. Energy |
132,686,409 | |||
|
U.S. Healthcare |
37,339,076 | |||
|
U.S. Technology |
19,593,108 | |||
|
U.S. Utilities |
34,883,574 | |||
As of October 31, 2020, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:
| iShares ETF | Tax Cost |
Gross Unrealized
Appreciation |
Gross Unrealized
Depreciation |
Net Unrealized
Appreciation (Depreciation) |
||||||||||||
|
Dow Jones U.S. |
$ | 733,032,844 | $ | 607,887,357 | $ | (86,414,733 | ) | $ | 521,472,624 | |||||||
|
Transportation Average |
1,163,786,578 | 57,675,272 | (41,176,142 | ) | 16,499,130 | |||||||||||
|
U.S. Energy |
833,987,605 | 3,460,293 | (478,098,094 | ) | (474,637,801 | ) | ||||||||||
|
U.S. Healthcare |
2,125,668,161 | 274,379,113 | (166,304,149 | ) | 108,074,964 | |||||||||||
|
U.S. Technology |
3,933,348,089 | 2,172,363,150 | (149,361,600 | ) | 2,023,001,550 | |||||||||||
|
U.S. Utilities |
865,540,571 | 46,630,690 | (79,690,769 | ) | (33,060,079 | ) | ||||||||||
| 56 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 9. |
PRINCIPAL RISKS |
In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.
BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.
The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.
Market Risk: An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.
Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A fund may invest in illiquid investments. An illiquid investment is any investment that a fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A fund may experience difficulty in selling illiquid investments in a timely manner at the price that it believes the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause a fund’s NAV to experience significant increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a fund may lose value, regardless of the individual results of the securities and other instruments in which a fund invests.
Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the statement of assets and liabilities, less any collateral held by the Funds.
A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.
With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.
Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.
Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific sectors are presented in the schedule of investments.
LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021, and it is expected that LIBOR will cease to be published after that time. The Funds may be exposed to financial instruments tied to LIBOR to determine payment obligations, financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Funds is uncertain.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
57 |
Notes to Financial Statements (unaudited) (continued)
| 10. |
CAPITAL SHARE TRANSACTIONS |
Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.
Transactions in capital shares were as follows:
|
|
||||||||||||||||
|
Six Months Ended
10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
|
|
||||||||||||||||
|
Dow Jones U.S. |
||||||||||||||||
|
Shares sold |
— | $ | — | 350,000 | $ | 45,960,610 | ||||||||||
|
Shares redeemed |
(450,000 | ) | (71,901,263 | ) | (700,000 | ) | (101,296,306 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(450,000 | ) | (71,901,263 | ) | (350,000 | ) | (55,335,696 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Transportation Average |
||||||||||||||||
|
Shares sold |
5,350,000 | 993,251,340 | 9,150,000 | 1,664,349,137 | ||||||||||||
|
Shares redeemed |
(2,500,000 | ) | (436,838,242 | ) | (9,050,000 | ) | (1,674,852,885 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
2,850,000 | 556,413,098 | 100,000 | (10,503,748 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Energy |
||||||||||||||||
|
Shares sold |
9,750,000 | 186,305,543 | 11,000,000 | 215,445,547 | ||||||||||||
|
Shares redeemed |
(9,250,000 | ) | (176,902,533 | ) | (10,050,000 | ) | (261,637,556 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
500,000 | 9,403,010 | 950,000 | (46,192,009 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Healthcare |
||||||||||||||||
|
Shares sold |
1,350,000 | 298,821,009 | 2,800,000 | 572,958,479 | ||||||||||||
|
Shares redeemed |
(2,800,000 | ) | (624,907,157 | ) | (2,500,000 | ) | (478,909,093 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
(1,450,000 | ) | (326,086,148 | ) | 300,000 | 94,049,386 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Technology |
||||||||||||||||
|
Shares sold |
2,450,000 | 665,655,215 | 4,150,000 | 884,213,107 | ||||||||||||
|
Shares redeemed |
(3,300,000 | ) | (926,281,465 | ) | (4,400,000 | ) | (922,623,445 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(850,000 | ) | (260,626,250 | ) | (250,000 | ) | (38,410,338 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Utilities |
||||||||||||||||
|
Shares sold |
450,000 | 68,100,575 | 3,950,000 | 627,020,099 | ||||||||||||
|
Shares redeemed |
(1,150,000 | ) | (167,566,408 | ) | (3,250,000 | ) | (459,858,241 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
(700,000 | ) | (99,465,833 | ) | 700,000 | 167,161,858 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.
From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the statement of assets and liabilities.
| 11. |
LEGAL PROCEEDINGS |
On June 16, 2016, investors in certain iShares funds (iShares Core S&P Small-Cap ETF, iShares Russell 1000 Growth ETF, iShares Core S&P 500 ETF, iShares Russell Mid-Cap Growth ETF, iShares Russell Mid-Cap ETF, iShares Russell Mid-Cap Value ETF, iShares Select Dividend ETF, iShares Morningstar Mid-Cap ETF, iShares Morningstar Large-Cap ETF, iShares U.S. Aerospace & Defense ETF and iShares Preferred and Income Securities ETF) filed a class action lawsuit against iShares Trust, BlackRock, Inc. and certain of its advisory affiliates, and certain directors/trustees and officers of the Funds (collectively, “Defendants”) in California State Court. The lawsuit alleges the Defendants violated federal securities laws by failing to adequately disclose in the prospectuses issued by the funds noted above the risks of using stop-loss orders in the event of a ‘flash crash’, such as the one that occurred on May 6, 2010. On September 18, 2017, the court issued a Statement of Decision holding that the Plaintiffs lack standing to assert their claims. On October 11, 2017, the court entered final judgment dismissing all of the Plaintiffs’ claims with prejudice. In an opinion dated January 23, 2020, the California Court of Appeal affirmed the dismissal of Plaintiffs’ claims. On March 3, 2020, plaintiffs filed a petition for review by the California Supreme Court. On May 27, 2020, the California Supreme Court denied Plaintiff’s petition for review. The case is now closed.
Certain iShares funds (the “Impacted Funds”), along with thousands of other former shareholders of Tribune Company (“Tribune”), were named as defendants in one or more lawsuits (the “Litigation”) arising out of Tribune’s 2007 leveraged buyout transaction (“LBO”). The Litigation seeks to “claw back” from former Tribune shareholders,
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Notes to Financial Statements (unaudited) (continued)
including the Impacted Funds, proceeds received in connection with the LBO. The iShares Dow Jones U.S. ETF received proceeds of $118,354 in the LBO. The claims that were originally brought against the Impacted Funds were dismissed but are currently subject to appeals in multiple appellate courts. The outcome of these appeals could result in new claims being brought against the Impacted Funds and/or previously dismissed claims being revived and subject to continuing litigation. The Impacted Funds intend to vigorously defend the Litigation.
| 12. |
SUBSEQUENT EVENTS |
Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were available to be issued and the following items were noted:
On September 17, 2020, the Board approved a stock split for the following Funds, effective after the close of trading on December 4, 2020. The impact of the stock split will be to increase the number of shares outstanding, while decreasing the NAV per share, resulting in no effect on the net assets of the Funds.
| iShares ETF | Forward Share Split | |||
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Dow Jones U.S. |
2 for 1 | |||
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U.S. Technology |
4 for 1 | |||
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U.S. Utilities |
2 for 1 | |||
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N O T E S T O F I N A N C I A L S T A T E M E N T S |
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Board Review and Approval of Investment Advisory Contract
iShares Dow Jones U.S. ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares
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Board Review and Approval of Investment Advisory Contract (continued)
funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares Transportation Average ETF, iShares U.S. Technology ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers;
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Board Review and Approval of Investment Advisory Contract (continued)
risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue,
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Board Review and Approval of Investment Advisory Contract (continued)
including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares U.S. Energy ETF, iShares U.S. Healthcare ETF, iShares U.S. Utilities ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with
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Board Review and Approval of Investment Advisory Contract (continued)
independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
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Board Review and Approval of Investment Advisory Contract (continued)
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
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B O A R D R E V I E W A N D A P P R O V A L O F I N V E S T M E N T A D V I S O R Y C O N T R A C T |
65 |
Supplemental Information (unaudited)
Section 19(a) Notices
The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.
October 31, 2020
|
Total Cumulative Distributions
for the Fiscal Year-to-Date |
% Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date |
|||||||||||||||||||||||||||||||||||
| iShares ETF |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
||||||||||||||||||||||||||||
|
Dow Jones U.S.(a) |
$ | 1.196289 | $ | — | $ | 0.019841 | $ | 1.216130 | 98 | % | — | % | 2 | % | 100 | % | ||||||||||||||||||||
| (a) |
The Fund estimates that it has distributed more than its net investment income and net realized capital 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 shareholder’s investment in the Fund is returned 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”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share. |
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Electronic Delivery
Shareholders can sign up for email notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.
To enroll in electronic delivery:
| • |
Go to icsdelivery.com. |
| • |
If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor. |
Householding
Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.
Availability of Quarterly Schedule of Investments
The iShares Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The iShares Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. The iShares Funds also disclose their complete schedule of portfolio holdings on a daily basis on the iShares website at iShares.com.
Availability of Proxy Voting Policies and Proxy Voting Records
A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.
A description of the Company’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.
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G E N E R A L I N F O R M A T I O N |
67 |
Glossary of Terms Used in this Report
| Portfolio Abbreviations - Equity | ||
| NVS | Non-Voting Shares | |
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Want to know more?
iShares.com | 1-800-474-2737
This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.
Investing involves risk, including possible loss of principal.
The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by S&P Dow Jones Indices LLC, nor does this company make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the company listed above.
©2020 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.
iS-SAR-401-1020
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OCTOBER 31, 2020 |
|
|
2020 Semi-Annual Report (Unaudited)
|
|
iShares Trust
| · |
iShares U.S. Basic Materials ETF | IYM | NYSE Arca |
| · |
iShares U.S. Consumer Goods ETF | IYK | NYSE Arca |
| · |
iShares U.S. Consumer Services ETF | IYC | NYSE Arca |
| · |
iShares U.S. Financial Services ETF | IYG | NYSE Arca |
| · |
iShares U.S. Financials ETF | IYF | NYSE Arca |
| · |
iShares U.S. Industrials ETF | IYJ | Cboe BZX |
| · |
iShares MSCI KLD 400 Social ETF | DSI | NYSE Arca |
| · |
iShares MSCI USA ESG Select ETF | SUSA | NYSE Arca |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.
Dear Shareholder,
The 12-month reporting period as of October 31, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus (or “COVID-19”) led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered solid returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.
After markets hit their lowest point of the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which declined marginally during the reporting period. International equities from developed economies declined, significantly lagging emerging market stocks, which rebounded sharply.
During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.
The Fed took an accommodative monetary stance in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted two emergency interest rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.
Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.
Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring emerging market stocks and tilting toward the quality factor for its resilience.
In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.
Sincerely,
Rob Kapito
President, BlackRock, Inc.
Rob Kapito
President, BlackRock, Inc.
| Total Returns as of October 31, 2020 | ||||
| 6-Month | 12-Month | |||
|
U.S. large cap equities
|
13.29% | 9.71% | ||
|
U.S. small cap equities
|
18.13 | (0.14) | ||
|
International equities
|
8.57 | (6.86) | ||
|
Emerging market equities
|
20.96 | 8.25 | ||
|
3-month Treasury
bills
|
0.06 | 0.92 | ||
|
U.S. Treasury securities
|
(1.63) | 8.92 | ||
|
U.S. investment grade bonds
|
1.27 | 6.19 | ||
|
Tax-exempt municipal
bonds
|
4.87 | 3.55 | ||
|
U.S. high yield bonds
|
10.73 | 3.42 | ||
|
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index. |
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T H I S P A G E I S N O T P A R T O F Y O U R F U N D R E P O R T |
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| 4 | ||||
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| 12 | ||||
| 13 | ||||
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Financial Statements |
||||
| 43 | ||||
| 45 | ||||
| 47 | ||||
| 51 | ||||
| 59 | ||||
| 69 | ||||
| 77 | ||||
| 78 | ||||
| 79 | ||||
| Fund Summary as of October 31, 2020 | iShares® U.S. Basic Materials ETF |
Investment Objective
The iShares U.S. Basic Materials ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the basic materials sector, as represented by the Dow Jones U.S. Basic Materials IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
20.62 | % | 7.55 | % | 7.65 | % | 5.45 | % | 7.55 | % | 44.58 | % | 70.08 | % | ||||||||||||||||||
|
Fund Market |
20.83 | 7.68 | 7.68 | 5.47 | 7.68 | 44.75 | 70.30 | |||||||||||||||||||||||||
|
Index |
20.79 | 7.92 | 8.06 | 5.89 | 7.92 | 47.32 | 77.21 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,206.20 | $ 2.34 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Chemicals |
80.1 | % | ||
|
Metals & Mining |
19.9 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Linde PLC |
19.2 | % | ||
|
Air Products & Chemicals Inc. |
10.1 | |||
|
Newmont Corp. |
8.4 | |||
|
Ecolab Inc. |
7.6 | |||
|
PPG Industries Inc. |
4.9 | |||
|
Dow Inc. |
4.7 | |||
|
DuPont de Nemours Inc. |
4.7 | |||
|
Freeport-McMoRan Inc. |
4.2 | |||
|
Corteva Inc. |
4.2 | |||
|
LyondellBasell Industries NV, Class A |
3.0 | |||
(a) Excludes money market funds.
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| Fund Summary as of October 31, 2020 | iShares® U.S. Consumer Goods ETF |
Investment Objective
The iShares U.S. Consumer Goods ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the consumer goods sector, as represented by the Dow Jones U.S. Consumer Goods IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
22.28 | % | 16.32 | % | 8.18 | % | 11.26 | % | 16.32 | % | 48.13 | % | 190.65 | % | ||||||||||||||||||
|
Fund Market |
22.43 | 16.38 | 8.19 | 11.27 | 16.38 | 48.21 | 190.86 | |||||||||||||||||||||||||
|
Index |
22.57 | 16.85 | 8.63 | 11.75 | 16.85 | 51.26 | 203.65 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,222.80 | $ 2.35 | $ 1,000.00 | $ 1,023.10 | $ 2.14 | 0.42 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of Total Investments |
(a) |
|
|
Food, Beverage & Tobacco |
38.4 | % | ||
|
Household & Personal Products |
21.8 | |||
|
Automobiles & Components |
16.6 | |||
|
Consumer Durables & Apparel |
15.9 | |||
|
Media & Entertainment |
4.7 | |||
|
Retailing |
1.1 | |||
|
Capital Goods |
1.0 | |||
|
Other (each representing less than 1%) |
0.5 |
TEN LARGEST HOLDINGS
| Security |
|
Percent of Total Investments |
(a) |
|
|
Procter & Gamble Co. (The) |
13.3 | % | ||
|
Tesla Inc. |
11.2 | |||
|
Coca-Cola Co. (The) |
7.2 | |||
|
PepsiCo Inc. |
7.2 | |||
|
Nike Inc., Class B |
5.8 | |||
|
Philip Morris International Inc. |
4.3 | |||
|
Mondelez International Inc., Class A |
2.9 | |||
|
Colgate-Palmolive Co. |
2.6 | |||
|
Altria Group Inc. |
2.6 | |||
|
Activision Blizzard Inc. |
2.3 |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
5 |
| Fund Summary as of October 31, 2020 | iShares® U.S. Consumer Services ETF |
Investment Objective
The iShares U.S. Consumer Services ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the consumer services sector, as represented by the Dow Jones U.S. Consumer Services Capped (TR) IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
18.93 | % | 11.37 | % | 11.46 | % | 15.41 | % | 11.37 | % | 72.06 | % | 319.20 | % | ||||||||||||||||||
|
Fund Market |
18.95 | 11.31 | 11.46 | 15.40 | 11.31 | 72.03 | 318.97 | |||||||||||||||||||||||||
|
Index |
19.17 | 11.85 | 11.95 | 15.92 | 11.85 | 75.84 | 338.02 | |||||||||||||||||||||||||
Index performance through June 23, 2019 reflects the performance of the Dow Jones U.S. Consumer Services Total Return Index. Index performance beginning on June 24, 2019 reflects the performance of the Dow Jones U.S. Consumer Services Capped (TR) IndexTM.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,189.30 | $ | 2.32 | $ | 1,000.00 | $ | 1,023.10 | $ | 2.14 | 0.42 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Retailing |
40.5 | % | ||
|
Media & Entertainment |
22.6 | |||
|
Consumer Services |
17.5 | |||
|
Food & Staples Retailing |
12.3 | |||
|
Transportation |
3.9 | |||
|
Commercial & Professional Services |
2.2 | |||
|
Other (each representing less than 1%) |
1.0 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Amazon.com Inc. |
9.6 | % | ||
|
Home Depot Inc. (The) |
8.2 | |||
|
Costco Wholesale Corp. |
4.8 | |||
|
Walmart Inc. |
4.6 | |||
|
McDonald’s Corp. |
4.6 | |||
|
Netflix Inc. |
4.4 | |||
|
Comcast Corp., Class A |
4.4 | |||
|
Walt Disney Co. (The) |
4.2 | |||
|
Lowe’s Companies Inc. |
3.8 | |||
|
Starbucks Corp. |
3.2 | |||
| (a) |
Excludes money market funds. |
| 6 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® U.S. Financial Services ETF |
Investment Objective
The iShares U.S. Financial Services ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the financial services sector, as represented by the Dow Jones U.S. Financial Services IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
4.48 | % | (13.51 | )% | 7.41 | % | 10.31 | % | (13.51 | )% | 42.99 | % | 166.73 | % | ||||||||||||||||||
|
Fund Market |
4.52 | (13.56 | ) | 7.40 | 10.31 | (13.56 | ) | 42.91 | 166.66 | |||||||||||||||||||||||
|
Index |
4.66 | (13.17 | ) | 7.88 | 10.79 | (13.17 | ) | 46.11 | 178.50 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,044.80 | $ | 2.16 | $ | 1,000.00 | $ | 1,023.10 | $ | 2.14 | 0.42 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Banks |
40.2 | % | ||
|
Diversified Financials |
37.9 | |||
|
Software & Services |
21.5 | |||
|
Insurance |
0.4 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Visa Inc., Class A |
11.8 | % | ||
|
JPMorgan Chase & Co. |
11.5 | |||
|
Mastercard Inc., Class A |
9.8 | |||
|
Bank of America Corp. |
6.9 | |||
|
Wells Fargo & Co. |
3.4 | |||
|
Citigroup Inc. |
3.3 | |||
|
BlackRock Inc. |
3.3 | |||
|
S&P Global Inc. |
3.0 | |||
|
Morgan Stanley |
2.6 | |||
|
Goldman Sachs Group Inc. (The) |
2.5 | |||
| (a) |
Excludes money market funds. |
| F U N D S U M M A R Y | 7 |
| Fund Summary as of October 31, 2020 | iShares® U.S. Financials ETF |
Investment Objective
The iShares U.S. Financials ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the financials sector, as represented by the Dow Jones U.S. Financials Capped (TR) IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
5.08 | % | (13.42 | )% | 6.40 | % | 9.54 | % | (13.42 | )% | 36.36 | % | 148.63 | % | ||||||||||||||||||
|
Fund Market |
5.08 | (13.47 | ) | 6.39 | 9.53 | (13.47 | ) | 36.30 | 148.57 | |||||||||||||||||||||||
|
Index |
5.29 | (13.05 | ) | 6.83 | 9.99 | (13.05 | ) | 39.17 | 159.23 | |||||||||||||||||||||||
Index performance through June 23, 2019 reflects the performance of the Dow Jones U.S. Financials Total Return Index. Index performance beginning on June 24, 2019 reflects the performance of the Dow Jones U.S. Financials Capped (TR) IndexTM.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,050.80 | $ | 2.17 | $ | 1,000.00 | $ | 1,023.10 | $ | 2.14 | 0.42 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Diversified Financials |
31.3 | % | ||
|
Banks |
22.8 | |||
|
Real Estate |
21.0 | |||
|
Insurance |
13.6 | |||
|
Software & Services |
10.6 | |||
|
Commercial & Professional Services |
0.7 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Berkshire Hathaway Inc., Class B |
8.6 | % | ||
|
Visa Inc., Class A |
6.5 | |||
|
JPMorgan Chase & Co. |
6.4 | |||
|
Mastercard Inc., Class A |
4.0 | |||
|
Bank of America Corp. |
3.9 | |||
|
American Tower Corp. |
2.2 | |||
|
Wells Fargo & Co. |
1.9 | |||
|
Citigroup Inc. |
1.9 | |||
|
BlackRock Inc. |
1.9 | |||
|
S&P Global Inc. |
1.7 | |||
| (a) |
Excludes money market funds. |
| 8 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® U.S. Industrials ETF |
Investment Objective
The iShares U.S. Industrials ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the industrials sector, as represented by the Dow Jones U.S. Industrials IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
19.72 | % | 3.83 | % | 10.88 | % | 12.27 | % | 3.83 | % | 67.60 | % | 218.12 | % | ||||||||||||||||||
|
Fund Market |
19.95 | 3.96 | 10.91 | 12.28 | 3.96 | 67.80 | 218.52 | |||||||||||||||||||||||||
|
Index |
19.97 | 4.27 | 11.37 | 12.77 | 4.27 | 71.31 | 232.55 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,197.20 | $ | 2.33 | $ | 1,000.00 | $ | 1,023.10 | $ | 2.14 | 0.42 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Capital Goods |
47.4 | % | ||
|
Software & Services |
21.1 | |||
|
Transportation |
13.7 | |||
|
Materials |
6.5 | |||
|
Commercial & Professional Services |
5.5 | |||
|
Technology Hardware & Equipment |
5.4 | |||
|
Pharmaceuticals, Biotechnology & Life Sciences |
0.4 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
PayPal Holdings Inc. |
6.0 | % | ||
|
Accenture PLC, Class A |
3.8 | |||
|
Union Pacific Corp. |
3.3 | |||
|
Honeywell International Inc. |
3.2 | |||
|
United Parcel Service Inc., Class B |
3.0 | |||
|
3M Co. |
2.5 | |||
|
Lockheed Martin Corp. |
2.4 | |||
|
Caterpillar Inc. |
2.3 | |||
|
Raytheon Technologies Corp. |
2.3 | |||
|
Fidelity National Information Services Inc. |
2.1 | |||
| (a) |
Excludes money market funds. |
F U N D S U M M A R Y
| 9 |
| Fund Summary as of October 31, 2020 | iShares® MSCI KLD 400 Social ETF |
Investment Objective
The iShares MSCI KLD 400 Social ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics, as represented by the MSCI KLD 400 Social Index (the “Index”). The index excludes companies involved in tobacco, alcohol, gambling, controversial weapons, civilian firearms, nuclear weapons, conventional weapons, nuclear power, adult entertainment and genetically modified organisms (GMOs). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
14.19 | % | 12.11 | % | 11.80 | % | 12.52 | % | 12.11 | % | 74.66 | % | 225.38 | % | ||||||||||||||||||
|
Fund Market |
14.41 | 12.23 | 11.83 | 12.53 | 12.23 | 74.91 | 225.66 | |||||||||||||||||||||||||
|
Index |
14.33 | 12.39 | 12.23 | 13.03 | 12.39 | 78.08 | 240.22 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,141.90 | $ | 1.35 | $ | 1,000.00 | $ | 1,023.90 | $ | 1.28 | 0.25 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
31.7 | % | ||
|
Communication Services |
13.9 | |||
|
Health Care |
10.3 | |||
|
Consumer Discretionary |
10.1 | |||
|
Industrials |
8.8 | |||
|
Consumer Staples |
8.0 | |||
|
Financials |
7.6 | |||
|
Real Estate |
3.2 | |||
|
Materials |
3.1 | |||
|
Utilities |
2.0 | |||
|
Energy |
1.3 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Microsoft Corp. |
9.5 | % | ||
|
Facebook Inc., Class A |
4.1 | |||
|
Alphabet Inc., Class C |
3.2 | |||
|
Alphabet Inc., Class A |
3.2 | |||
|
Procter & Gamble Co. (The) |
2.2 | |||
|
NVIDIA Corp. |
2.0 | |||
|
Visa Inc., Class A |
2.0 | |||
|
Tesla Inc. |
1.9 | |||
|
Home Depot Inc. (The) |
1.9 | |||
|
Mastercard Inc., Class A |
1.7 | |||
| (a) |
Excludes money market funds. |
| 10 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® MSCI USA ESG Select ETF |
Investment Objective
The iShares MSCI USA ESG Select ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics, as represented by the MSCI USA Extended ESG Select Index (the “Index”). The index further excludes companies whose primary revenue is derived from alcohol, gambling, nuclear power, conventional and controversial weapons and civilian firearms. The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
17.90 | % | 16.55 | % | 12.94 | % | 12.48 | % | 16.55 | % | 83.74 | % | 224.13 | % | ||||||||||||||||||
|
Fund Market |
18.04 | 16.60 | 12.95 | 12.48 | 16.60 | 83.85 | 224.26 | |||||||||||||||||||||||||
|
Index |
18.06 | 16.86 | 13.37 | 12.98 | 16.86 | 87.32 | 238.92 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 12 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,179.00 | $ | 1.37 | $ | 1,000.00 | $ | 1,023.90 | $ | 1.28 | 0.25 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 12 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
29.8 | % | ||
|
Health Care |
13.0 | |||
|
Industrials |
11.6 | |||
|
Consumer Discretionary |
9.3 | |||
|
Financials |
8.7 | |||
|
Consumer Staples |
8.1 | |||
|
Communication Services |
8.0 | |||
|
Real Estate |
3.9 | |||
|
Utilities |
3.6 | |||
|
Materials |
2.6 | |||
|
Energy |
1.4 | |||
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Microsoft Corp. |
4.9 | % | ||
|
Apple Inc. |
4.8 | |||
|
salesforce.com Inc. |
3.0 | |||
|
Alphabet Inc., Class A |
3.0 | |||
|
Accenture PLC, Class A |
2.6 | |||
|
Cummins Inc. |
2.3 | |||
|
3M Co. |
2.0 | |||
|
BlackRock Inc. |
2.0 | |||
|
Home Depot Inc. (The) |
2.0 | |||
|
Alphabet Inc., Class C |
1.9 | |||
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
11 |
| About Fund Performance |
Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.
Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.
An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.
As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses – The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes – The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| 12 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Basic Materials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Chemicals — 80.0% | ||||||||
|
Air Products & Chemicals Inc. |
234,973 | $ | 64,908,941 | |||||
|
Albemarle Corp. |
118,774 | 11,070,925 | ||||||
|
Ashland Global Holdings Inc. |
66,579 | 4,645,217 | ||||||
|
Axalta Coating Systems Ltd.(a) |
246,370 | 6,186,351 | ||||||
|
Celanese Corp. |
130,172 | 14,775,824 | ||||||
|
CF Industries Holdings Inc. |
243,133 | 6,712,902 | ||||||
|
Chemours Co. (The) |
204,547 | 4,119,577 | ||||||
|
Corteva Inc. |
807,996 | 26,647,708 | ||||||
|
Dow Inc. |
664,838 | 30,243,481 | ||||||
|
DuPont de Nemours Inc. |
529,404 | 30,112,499 | ||||||
|
Eastman Chemical Co. |
148,597 | 12,012,581 | ||||||
|
Ecolab Inc. |
264,921 | 48,636,846 | ||||||
|
Element Solutions Inc.(a) |
287,052 | 3,364,249 | ||||||
|
FMC Corp. |
142,593 | 14,650,005 | ||||||
|
Huntsman Corp. |
236,198 | 5,737,249 | ||||||
|
Ingevity Corp.(a) |
55,619 | 3,052,371 | ||||||
|
International Flavors & Fragrances Inc.(b) |
118,793 | 12,195,289 | ||||||
|
Linde PLC |
556,282 | 122,571,176 | ||||||
|
LyondellBasell Industries NV, Class A |
279,537 | 19,134,308 | ||||||
|
Mosaic Co. (The) |
397,960 | 7,362,260 | ||||||
|
NewMarket Corp. |
9,504 | 3,399,486 | ||||||
|
PPG Industries Inc. |
240,565 | 31,206,092 | ||||||
|
RPM International Inc. |
144,335 | 12,220,844 | ||||||
|
Scotts Miracle-Gro Co. (The) |
47,052 | 7,060,153 | ||||||
|
Valvoline Inc. |
227,552 | 4,475,948 | ||||||
|
Westlake Chemical Corp. |
43,035 | 2,910,027 | ||||||
|
WR Grace & Co. |
80,372 | 3,495,378 | ||||||
|
|
|
|||||||
| 512,907,687 | ||||||||
| Metals & Mining — 19.8% | ||||||||
|
Alcoa Corp.(a) |
247,027 | 3,191,589 | ||||||
|
Commercial Metals Co. |
157,410 | 3,250,516 | ||||||
|
Freeport-McMoRan Inc. |
1,565,897 | 27,152,654 | ||||||
| Security | Shares | Value | ||||||
| Metals & Mining (continued) | ||||||||
|
Newmont Corp. |
856,413 | $ | 53,816,993 | |||||
|
Nucor Corp. |
331,194 | 15,817,825 | ||||||
|
Reliance Steel & Aluminum Co. |
72,982 | 7,954,308 | ||||||
|
Royal Gold Inc. |
74,438 | 8,843,979 | ||||||
|
Steel Dynamics Inc. |
230,506 | 7,256,329 | ||||||
|
|
|
|||||||
| 127,284,193 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
640,191,880 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 1.9% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
10,893,766 | 10,901,392 | ||||||
|
BlackRock Cash Funds: Treasury,
|
1,227,000 | 1,227,000 | ||||||
|
|
|
|||||||
| 12,128,392 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.9%
|
|
12,128,392 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.7%
|
|
652,320,272 | ||||||
|
Other Assets, Less Liabilities — (1.7)% |
|
(11,015,554 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 641,304,718 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 7,978,484 | $ | 2,925,315 | (a) | $ | — | $ | 13,171 | $ | (15,578 | ) | $ | 10,901,392 | 10,893,766 | $ | 26,342 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
357,000 | 870,000 | (a) | — | — | — | 1,227,000 | 1,227,000 | 380 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 13,171 | $ | (15,578 | ) | $ | 12,128,392 | $ | 26,722 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
13 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Basic Materials ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P MidCap 400 E-Mini Index |
1 | 12/18/20 | $ | 190 | $ | (602 | ) | |||||||||
|
S&P Select Sector Industrial E-Mini Index |
8 | 12/18/20 | 609 | (14,187 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (14,789 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 14,789 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 114,274 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (52,747 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 612,987 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 640,191,880 | $ | — | $ | — | $ | 640,191,880 | ||||||||
|
Money Market Funds |
12,128,392 | — | — | 12,128,392 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 652,320,272 | $ | — | $ | — | $ | 652,320,272 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (14,789 | ) | $ | — | $ | — | $ | (14,789 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 14 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Consumer Goods ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Auto Components — 2.1% | ||||||||
|
Aptiv PLC |
64,400 | $ | 6,213,956 | |||||
|
Autoliv Inc. |
18,706 | 1,417,915 | ||||||
|
BorgWarner Inc. |
58,299 | 2,039,299 | ||||||
|
Gentex Corp. |
58,732 | 1,625,114 | ||||||
|
Lear Corp. |
13,034 | 1,574,638 | ||||||
|
|
|
|||||||
| 12,870,922 | ||||||||
| Automobiles — 14.5% | ||||||||
|
Ford Motor Co. |
931,935 | 7,203,857 | ||||||
|
General Motors Co. |
300,354 | 10,371,224 | ||||||
|
Harley-Davidson Inc. |
36,470 | 1,199,134 | ||||||
|
Tesla Inc.(a)(b) |
177,786 | 68,988,079 | ||||||
|
Thor Industries Inc. |
13,138 | 1,111,212 | ||||||
|
|
|
|||||||
| 88,873,506 | ||||||||
| Beverages — 18.2% | ||||||||
|
Boston Beer Co. Inc. (The), Class A, NVS(a) |
2,170 | 2,255,020 | ||||||
|
Brown-Forman Corp., Class B, NVS |
43,531 | 3,034,546 | ||||||
|
Coca-Cola Co. (The) |
922,004 | 44,311,512 | ||||||
|
Constellation Brands Inc., Class A |
40,073 | 6,621,262 | ||||||
|
Keurig Dr Pepper Inc. |
110,752 | 2,979,229 | ||||||
|
Molson Coors Beverage Co., Class B |
44,938 | 1,584,514 | ||||||
|
Monster Beverage Corp.(a) |
88,047 | 6,741,759 | ||||||
|
National Beverage Corp.(a)(b) |
2,784 | 217,959 | ||||||
|
PepsiCo Inc. |
330,231 | 44,016,490 | ||||||
|
|
|
|||||||
| 111,762,291 | ||||||||
| Distributors — 1.0% | ||||||||
|
Genuine Parts Co. |
34,406 | 3,111,335 | ||||||
|
Pool Corp. |
9,558 | 3,343,675 | ||||||
|
|
|
|||||||
| 6,455,010 | ||||||||
| Diversified Financial Services — 0.2% | ||||||||
|
Jefferies Financial Group Inc. |
51,338 | 1,001,604 | ||||||
|
|
|
|||||||
| Entertainment — 4.6% | ||||||||
|
Activision Blizzard Inc. |
184,089 | 13,941,060 | ||||||
|
Electronic Arts Inc.(a) |
68,877 | 8,253,531 | ||||||
|
Take-Two Interactive Software Inc.(a) |
27,269 | 4,224,513 | ||||||
|
Zynga Inc., Class A(a) |
238,700 | 2,145,913 | ||||||
|
|
|
|||||||
| 28,565,017 | ||||||||
| Food & Staples Retailing — 0.4% | ||||||||
|
Performance Food Group Co.(a) |
31,592 | 1,061,807 | ||||||
|
U.S. Foods Holding Corp.(a)(b) |
52,512 | 1,097,501 | ||||||
|
|
|
|||||||
| 2,159,308 | ||||||||
| Food Products — 13.3% | ||||||||
|
Archer-Daniels-Midland Co. |
132,520 | 6,127,725 | ||||||
|
Beyond Meat Inc.(a) |
11,774 | 1,676,971 | ||||||
|
Bunge Ltd. |
33,366 | 1,892,853 | ||||||
|
Campbell Soup Co. |
48,317 | 2,254,954 | ||||||
|
Conagra Brands Inc. |
116,501 | 4,088,020 | ||||||
|
Darling Ingredients Inc.(a)(b) |
38,544 | 1,657,392 | ||||||
|
Flowers Foods Inc. |
46,834 | 1,104,346 | ||||||
|
General Mills Inc. |
145,702 | 8,613,902 | ||||||
|
Hain Celestial Group Inc. (The)(a) |
20,001 | 615,031 | ||||||
|
Hershey Co. (The) |
35,156 | 4,832,544 | ||||||
|
Hormel Foods Corp. |
66,922 | 3,258,432 | ||||||
|
Ingredion Inc. |
15,944 | 1,130,270 | ||||||
|
JM Smucker Co. (The) |
27,206 | 3,052,513 | ||||||
|
Kellogg Co. |
60,521 | 3,806,166 | ||||||
|
Kraft Heinz Co. (The) |
154,538 | 4,727,317 | ||||||
| Security | Shares | Value | ||||||
| Food Products (continued) | ||||||||
|
Lamb Weston Holdings Inc. |
34,674 | $ | 2,200,065 | |||||
|
Lancaster Colony Corp. |
4,643 | 771,388 | ||||||
|
McCormick & Co. Inc./MD, NVS |
29,560 | 5,335,876 | ||||||
|
Mondelez International Inc., Class A |
340,654 | 18,095,540 | ||||||
|
Pilgrim’s Pride Corp.(a)(b) |
11,682 | 195,557 | ||||||
|
Post Holdings Inc.(a)(b) |
14,984 | 1,287,126 | ||||||
|
Seaboard Corp. |
62 | 213,590 | ||||||
|
TreeHouse Foods Inc.(a)(b) |
13,437 | 521,893 | ||||||
|
Tyson Foods Inc., Class A |
70,178 | 4,016,287 | ||||||
|
|
|
|||||||
| 81,475,758 | ||||||||
| Household Durables — 4.3% | ||||||||
|
DR Horton Inc. |
78,935 | 5,273,647 | ||||||
|
Helen of Troy Ltd.(a) |
6,027 | 1,142,719 | ||||||
|
Leggett & Platt Inc. |
31,644 | 1,320,504 | ||||||
|
Lennar Corp., Class A |
65,495 | 4,599,714 | ||||||
|
Lennar Corp., Class B |
3,683 | 209,526 | ||||||
|
Mohawk Industries Inc.(a) |
14,292 | 1,474,792 | ||||||
|
Newell Brands Inc. |
90,235 | 1,593,550 | ||||||
|
NVR Inc.(a) |
831 | 3,285,018 | ||||||
|
PulteGroup Inc. |
63,962 | 2,607,091 | ||||||
|
Tempur Sealy International Inc.(a) |
11,407 | 1,015,223 | ||||||
|
Toll Brothers Inc. |
27,329 | 1,155,470 | ||||||
|
Whirlpool Corp. |
14,857 | 2,747,951 | ||||||
|
|
|
|||||||
| 26,425,205 | ||||||||
| Household Products — 19.6% | ||||||||
|
Church & Dwight Co. Inc. |
58,983 | 5,213,507 | ||||||
|
Clorox Co. (The) |
30,102 | 6,238,640 | ||||||
|
Colgate-Palmolive Co. |
204,487 | 16,131,979 | ||||||
|
Energizer Holdings Inc. |
13,943 | 548,657 | ||||||
|
Kimberly-Clark Corp. |
81,339 | 10,784,738 | ||||||
|
Procter & Gamble Co. (The) |
593,767 | 81,405,456 | ||||||
|
Reynolds Consumer Products Inc. |
13,053 | 368,617 | ||||||
|
|
|
|||||||
| 120,691,594 | ||||||||
| Leisure Products — 1.9% | ||||||||
|
Brunswick Corp./DE |
18,841 | 1,200,360 | ||||||
|
Hasbro Inc. |
30,404 | 2,515,019 | ||||||
|
Mattel Inc.(a) |
82,778 | 1,139,853 | ||||||
|
Peloton Interactive Inc., Class A(a) |
49,147 | 5,416,491 | ||||||
|
Polaris Inc. |
13,772 | 1,251,324 | ||||||
|
|
|
|||||||
| 11,523,047 | ||||||||
| Machinery — 1.0% | ||||||||
|
Stanley Black & Decker Inc. |
38,084 | 6,329,561 | ||||||
|
|
|
|||||||
| Personal Products — 2.1% | ||||||||
|
Coty Inc., Class A |
67,763 | 196,512 | ||||||
|
Estee Lauder Companies Inc. (The), Class A |
53,797 | 11,817,049 | ||||||
|
Herbalife Nutrition Ltd.(a) |
23,313 | 1,052,349 | ||||||
|
|
|
|||||||
| 13,065,910 | ||||||||
| Textiles, Apparel & Luxury Goods — 9.7% | ||||||||
|
Carter’s Inc. |
10,384 | 845,777 | ||||||
|
Columbia Sportswear Co. |
7,283 | 543,239 | ||||||
|
Deckers Outdoor Corp.(a) |
6,694 | 1,696,059 | ||||||
|
Hanesbrands Inc. |
82,859 | 1,331,544 | ||||||
|
Levi Strauss & Co., Class A |
15,557 | 245,490 | ||||||
|
Lululemon Athletica Inc.(a) |
28,260 | 9,023,135 | ||||||
|
Nike Inc., Class B |
296,898 | 35,651,512 | ||||||
|
PVH Corp. |
16,947 | 987,841 | ||||||
|
Ralph Lauren Corp. |
11,473 | 766,970 | ||||||
|
Skechers U.S.A. Inc., Class A(a)(b) |
32,440 | 1,028,672 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
15 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Consumer Goods ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Textiles, Apparel & Luxury Goods (continued) | ||||||||
|
Tapestry Inc. |
65,741 | $ | 1,461,422 | |||||
|
Under Armour Inc., Class A(a)(b) |
45,140 | 624,738 | ||||||
|
Under Armour Inc., Class C, NVS(a) |
46,552 | 569,331 | ||||||
|
VF Corp. |
76,202 | 5,120,774 | ||||||
|
|
|
|||||||
| 59,896,504 | ||||||||
| Tobacco — 6.9% | ||||||||
|
Altria Group Inc. |
443,222 | 15,991,450 | ||||||
|
Philip Morris International Inc. |
371,408 | 26,377,396 | ||||||
|
|
|
|||||||
| 42,368,846 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
613,464,083 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 1.8% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
10,261,242 | 10,268,425 | ||||||
| Security | Shares | Value | ||||||
| Money Market Funds (continued) | ||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
810,000 | $ | 810,000 | |||||
|
|
|
|||||||
| 11,078,425 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.8%
|
|
11,078,425 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.6%
|
|
624,542,508 | ||||||
|
Other Assets, Less Liabilities — (1.6)% |
|
(9,661,428 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 614,881,080 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 1,687,862 | $ | 8,581,859 | (a) | $ | — | $ | 820 | $ | (2,116 | ) | $ | 10,268,425 | 10,261,242 | $ | 12,438 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
572,000 | 238,000 | (a) | — | — | — | 810,000 | 810,000 | 577 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 820 | $ | (2,116 | ) | $ | 11,078,425 | $ | 13,015 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P MidCap 400 E-Mini Index |
3 | 12/18/20 | $ | 569 | $ | 1,883 | ||||||||||
|
S&P Select Sector Consumer Staples E-Mini Index |
13 | 12/18/20 | 810 | (16,239 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (14,356 | ) | ||||||||||||||
|
|
|
|||||||||||||||
| 16 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Consumer Goods ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 1,883 | ||
|
|
|
|||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
16,239 | |||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 205,084 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (96,912 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,320,137 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 613,464,083 | $ | — | $ | — | $ | 613,464,083 | ||||||||
|
Money Market Funds |
11,078,425 | — | — | 11,078,425 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 624,542,508 | $ | — | $ | — | $ | 624,542,508 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 1,883 | $ | — | $ | — | $ | 1,883 | ||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
(16,239 | ) | — | — | (16,239 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | (14,356 | ) | $ | — | $ | — | $ | (14,356 | ) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
17 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Consumer Services ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Airlines — 2.1% | ||||||||
|
Alaska Air Group Inc. |
40,516 | $ | 1,535,151 | |||||
|
American Airlines Group Inc.(a) |
165,806 | 1,870,292 | ||||||
|
Delta Air Lines Inc. |
208,183 | 6,378,727 | ||||||
|
JetBlue Airways Corp.(a)(b) |
89,271 | 1,068,574 | ||||||
|
Southwest Airlines Co. |
192,553 | 7,611,620 | ||||||
|
United Airlines Holdings Inc.(b) |
95,046 | 3,218,258 | ||||||
|
|
|
|||||||
| 21,682,622 | ||||||||
| Commercial Services & Supplies — 1.2% | ||||||||
|
Copart Inc.(b) |
67,443 | 7,443,010 | ||||||
|
IAA Inc.(b) |
43,690 | 2,472,417 | ||||||
|
Rollins Inc. |
48,134 | 2,784,552 | ||||||
|
|
|
|||||||
| 12,699,979 | ||||||||
| Distributors — 0.3% | ||||||||
|
LKQ Corp.(a)(b) |
91,380 | 2,923,246 | ||||||
|
|
|
|||||||
| Diversified Consumer Services — 1.4% | ||||||||
|
Bright Horizons Family Solutions Inc.(a)(b) |
19,698 | 3,113,269 | ||||||
|
Chegg Inc.(a)(b) |
40,583 | 2,980,416 | ||||||
|
frontdoor Inc.(b) |
27,993 | 1,109,083 | ||||||
|
Grand Canyon Education Inc.(b) |
15,493 | 1,214,186 | ||||||
|
H&R Block Inc. |
63,212 | 1,091,039 | ||||||
|
Service Corp. International |
57,488 | 2,662,269 | ||||||
|
Terminix Global Holdings Inc.(b) |
43,001 | 2,024,917 | ||||||
|
|
|
|||||||
| 14,195,179 | ||||||||
| Entertainment — 10.0% | ||||||||
|
Liberty Media Corp.-Liberty Formula One, Class A(a)(b) |
8,418 | 280,319 | ||||||
|
Liberty Media Corp.-Liberty Formula One, Class C, NVS(b) |
66,372 | 2,398,020 | ||||||
|
Live Nation Entertainment Inc.(b) |
46,380 | 2,263,344 | ||||||
|
Madison Square Garden Sports Corp.(a)(b) |
5,678 | 804,232 | ||||||
|
Netflix Inc.(b) |
95,560 | 45,461,714 | ||||||
|
Roku Inc.(b) |
34,564 | 6,995,754 | ||||||
|
Walt Disney Co. (The) |
358,415 | 43,457,819 | ||||||
|
Warner Music Group Corp., Class A |
29,016 | 769,795 | ||||||
|
World Wrestling Entertainment Inc., Class A |
15,299 | 556,272 | ||||||
|
|
|
|||||||
| 102,987,269 | ||||||||
| Food & Staples Retailing — 12.3% | ||||||||
|
BJ’s Wholesale Club Holdings Inc.(a)(b) |
44,940 | 1,720,753 | ||||||
|
Casey’s General Stores Inc. |
12,035 | 2,028,740 | ||||||
|
Costco Wholesale Corp. |
137,974 | 49,342,262 | ||||||
|
Kroger Co. (The) |
253,991 | 8,181,050 | ||||||
|
Sprouts Farmers Market Inc.(a)(b) |
38,650 | 736,282 | ||||||
|
Sysco Corp. |
166,060 | 9,184,778 | ||||||
|
Walgreens Boots Alliance Inc. |
234,821 | 7,993,307 | ||||||
|
Walmart Inc. |
341,685 | 47,408,794 | ||||||
|
|
|
|||||||
| 126,595,966 | ||||||||
| Health Care Providers & Services — 0.9% | ||||||||
|
AmerisourceBergen Corp. |
48,048 | 4,615,971 | ||||||
|
Cardinal Health Inc. |
95,601 | 4,377,570 | ||||||
|
|
|
|||||||
| 8,993,541 | ||||||||
| Hotels, Restaurants & Leisure — 16.1% | ||||||||
|
Aramark |
82,503 | 2,288,633 | ||||||
|
Boyd Gaming Corp. |
26,280 | 833,602 | ||||||
|
Carnival Corp.(a) |
168,985 | 2,316,784 | ||||||
|
Chipotle Mexican Grill Inc.(b) |
9,133 | 10,973,117 | ||||||
|
Choice Hotels International Inc. |
9,434 | 824,060 | ||||||
|
Churchill Downs Inc. |
11,568 | 1,725,367 | ||||||
| Security | Shares | Value | ||||||
| Hotels, Restaurants & Leisure (continued) | ||||||||
|
Cracker Barrel Old Country Store Inc. |
7,764 | $ | 883,699 | |||||
|
Darden Restaurants Inc. |
42,508 | 3,907,335 | ||||||
|
Domino’s Pizza Inc. |
12,837 | 4,856,494 | ||||||
|
DraftKings Inc., Class A(a)(b) |
98,574 | 3,489,520 | ||||||
|
Dunkin’ Brands Group Inc. |
26,826 | 2,674,821 | ||||||
|
Hilton Worldwide Holdings Inc. |
90,537 | 7,950,054 | ||||||
|
Hyatt Hotels Corp., Class A |
11,593 | 639,238 | ||||||
|
Las Vegas Sands Corp. |
107,134 | 5,148,860 | ||||||
|
Marriott International Inc./MD, Class A |
86,827 | 8,064,492 | ||||||
|
Marriott Vacations Worldwide Corp. |
13,454 | 1,299,656 | ||||||
|
McDonald’s Corp. |
221,586 | 47,197,818 | ||||||
|
MGM Resorts International(a) |
133,676 | 2,749,715 | ||||||
|
Norwegian Cruise Line Holdings Ltd.(b) |
89,724 | 1,492,110 | ||||||
|
Planet Fitness Inc., Class A(b) |
26,053 | 1,544,161 | ||||||
|
Royal Caribbean Cruises Ltd. |
58,155 | 3,281,105 | ||||||
|
Starbucks Corp. |
381,732 | 33,195,415 | ||||||
|
Texas Roadhouse Inc. |
21,380 | 1,497,241 | ||||||
|
Vail Resorts Inc.(a) |
13,099 | 3,039,492 | ||||||
|
Wendy’s Co. (The) |
58,674 | 1,282,027 | ||||||
|
Wyndham Hotels & Resorts Inc. |
30,324 | 1,410,369 | ||||||
|
Wynn Resorts Ltd. |
31,664 | 2,293,424 | ||||||
|
Yum! Brands Inc. |
98,413 | 9,184,885 | ||||||
|
|
|
|||||||
| 166,043,494 | ||||||||
| Interactive Media & Services — 0.9% | ||||||||
|
Pinterest Inc., Class A(b) |
151,002 | 8,901,568 | ||||||
|
TripAdvisor Inc. |
31,489 | 601,755 | ||||||
|
|
|
|||||||
| 9,503,323 | ||||||||
| Internet & Direct Marketing Retail — 12.7% | ||||||||
|
Amazon.com Inc.(b) |
32,497 | 98,665,767 | ||||||
|
Booking Holdings Inc.(b) |
13,371 | 21,694,447 | ||||||
|
Expedia Group Inc. |
44,355 | 4,176,023 | ||||||
|
Qurate Retail Inc., Series A |
126,974 | 859,614 | ||||||
|
Wayfair Inc., Class A(a)(b) |
22,336 | 5,539,998 | ||||||
|
|
|
|||||||
| 130,935,849 | ||||||||
| IT Services — 0.1% | ||||||||
|
LiveRamp Holdings Inc.(b) |
21,588 | 1,426,751 | ||||||
|
|
|
|||||||
| Media — 11.7% | ||||||||
|
Altice USA Inc., Class A(b) |
107,943 | 2,909,064 | ||||||
|
Cable One Inc. |
1,770 | 3,065,392 | ||||||
|
Charter Communications Inc.,
|
48,843 | 29,492,380 | ||||||
|
Comcast Corp., Class A |
1,071,710 | 45,269,030 | ||||||
|
Discovery Inc., Class A(a)(b) |
52,499 | 1,062,580 | ||||||
|
Discovery Inc., Class C, NVS(a)(b) |
100,931 | 1,849,056 | ||||||
|
DISH Network Corp., Class A(b) |
80,499 | 2,051,920 | ||||||
|
Fox Corp., Class A, NVS |
112,234 | 2,976,446 | ||||||
|
Fox Corp., Class B(b) |
51,332 | 1,341,818 | ||||||
|
Interpublic Group of Companies Inc. (The) |
127,164 | 2,300,397 | ||||||
|
Liberty Broadband Corp., Class A(b) |
7,641 | 1,073,943 | ||||||
|
Liberty Broadband Corp., Class C,
|
49,936 | 7,076,431 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class A(b) |
27,254 | 942,171 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class C, NVS(b) |
56,842 | 1,966,733 | ||||||
|
New York Times Co. (The), Class A(a) |
47,077 | 1,867,074 | ||||||
|
News Corp., Class A, NVS |
126,718 | 1,663,807 | ||||||
|
News Corp., Class B |
39,903 | 519,537 | ||||||
|
Nexstar Media Group Inc., Class A |
14,841 | 1,222,898 | ||||||
|
Omnicom Group Inc. |
70,201 | 3,313,487 | ||||||
|
Sirius XM Holdings Inc.(a) |
396,216 | 2,270,318 | ||||||
|
TEGNA Inc. |
71,749 | 863,140 | ||||||
| 18 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Consumer Services ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Media (continued) | ||||||||
|
ViacomCBS Inc., Class A |
3,425 | $ | 102,270 | |||||
|
ViacomCBS Inc., Class B, NVS |
183,926 | 5,254,766 | ||||||
|
|
|
|||||||
| 120,454,658 | ||||||||
| Multiline Retail — 5.0% | ||||||||
|
Dollar General Corp. |
81,321 | 16,972,506 | ||||||
|
Dollar Tree Inc.(b) |
77,458 | 6,996,007 | ||||||
|
Kohl’s Corp. |
51,701 | 1,100,714 | ||||||
|
Ollie’s Bargain Outlet Holdings Inc.(a)(b) |
18,523 | 1,613,168 | ||||||
|
Target Corp. |
163,474 | 24,884,012 | ||||||
|
|
|
|||||||
| 51,566,407 | ||||||||
| Professional Services — 1.0% | ||||||||
|
IHS Markit Ltd. |
121,798 | 9,849,804 | ||||||
|
|
|
|||||||
| Road & Rail — 1.7% | ||||||||
|
AMERCO |
2,956 | 1,026,205 | ||||||
|
Lyft Inc., Class A(a)(b) |
79,148 | 1,806,949 | ||||||
|
Uber Technologies Inc.(b) |
452,126 | 15,105,529 | ||||||
|
|
|
|||||||
| 17,938,683 | ||||||||
| Specialty Retail — 22.5% | ||||||||
|
Aaron’s Holdings Co. Inc. |
22,002 | 1,149,825 | ||||||
|
Advance Auto Parts Inc. |
22,587 | 3,326,613 | ||||||
|
AutoNation Inc.(b) |
19,148 | 1,086,266 | ||||||
|
AutoZone Inc.(b) |
7,626 | 8,609,602 | ||||||
|
Best Buy Co. Inc. |
75,211 | 8,389,787 | ||||||
|
Burlington Stores Inc.(b) |
21,525 | 4,166,810 | ||||||
|
CarMax Inc.(b) |
53,196 | 4,598,262 | ||||||
|
Carvana Co.(b) |
18,141 | 3,362,434 | ||||||
|
Dick’s Sporting Goods Inc. |
21,348 | 1,209,364 | ||||||
|
Five Below Inc.(b) |
18,218 | 2,429,188 | ||||||
|
Floor & Decor Holdings Inc., Class A(b) |
33,849 | 2,470,977 | ||||||
|
Foot Locker Inc. |
34,157 | 1,259,710 | ||||||
|
Gap Inc. (The) |
67,333 | 1,309,627 | ||||||
|
Home Depot Inc. (The) |
316,477 | 84,407,581 | ||||||
|
L Brands Inc. |
76,141 | 2,437,273 | ||||||
|
Lithia Motors Inc., Class A |
8,356 | 1,918,287 | ||||||
|
Lowe’s Companies Inc. |
246,782 | 39,016,234 | ||||||
|
Murphy USA Inc.(b) |
8,893 | 1,087,525 | ||||||
| Security | Shares | Value | ||||||
| Specialty Retail (continued) | ||||||||
|
National Vision Holdings Inc.(a)(b) |
26,354 | $ | 1,062,857 | |||||
|
O’Reilly Automotive Inc.(b) |
24,186 | 10,559,608 | ||||||
|
Penske Automotive Group Inc. |
10,531 | 538,766 | ||||||
|
RH(a)(b) |
5,027 | 1,685,201 | ||||||
|
Ross Stores Inc. |
116,225 | 9,898,883 | ||||||
|
Tiffany & Co. |
35,306 | 4,619,437 | ||||||
|
TJX Companies Inc. (The) |
391,547 | 19,890,588 | ||||||
|
Tractor Supply Co. |
37,920 | 5,051,323 | ||||||
|
Ulta Beauty Inc.(b) |
18,411 | 3,806,842 | ||||||
|
Williams-Sonoma Inc. |
25,371 | 2,314,089 | ||||||
|
|
|
|||||||
| 231,662,959 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
|
1,029,459,730 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 1.9% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
18,446,636 | 18,459,549 | ||||||
|
BlackRock Cash Funds: Treasury,
|
1,473,000 | 1,473,000 | ||||||
|
|
|
|||||||
| 19,932,549 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.9%
|
|
19,932,549 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.8%
|
|
1,049,392,279 | ||||||
|
Other Assets, Less Liabilities — (1.8)% |
|
(18,454,600 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,030,937,679 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 21,049,903 | $ | — | $ | (2,566,468 | )(a) | $ | (13,848 | ) | $ | (10,038 | ) | $ | 18,459,549 | 18,446,636 | $ | 164,711 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
943,000 | 530,000 | (a) | — | — | — | 1,473,000 | 1,473,000 | 785 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (13,848 | ) | $ | (10,038 | ) | $ | 19,932,549 | $ | 165,496 | $ | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
19 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Consumer Services ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
2 | 12/18/20 | $ | 326 | $ | (6,737 | ) | |||||||||
|
S&P Select Sector Consumer Discretionary E-Mini Index |
7 | 12/18/20 | 1,010 | (28,256 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (34,993 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 34,993 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 215,574 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (106,144 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 941,113 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,029,459,730 | $ | — | $ | — | $ | 1,029,459,730 | ||||||||
|
Money Market Funds |
19,932,549 | — | — | 19,932,549 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,049,392,279 | $ | — | $ | — | $ | 1,049,392,279 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (34,993 | ) | $ | — | $ | — | $ | (34,993 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 20 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Financial Services ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Banks — 39.5% | ||||||||
|
Bank of America Corp. |
2,827,182 | $ | 67,004,213 | |||||
|
Bank OZK |
44,600 | 1,105,188 | ||||||
|
BOK Financial Corp. |
11,494 | 675,158 | ||||||
|
Citigroup Inc. |
771,970 | 31,974,997 | ||||||
|
Citizens Financial Group Inc. |
158,271 | 4,312,885 | ||||||
|
Comerica Inc. |
51,435 | 2,340,807 | ||||||
|
Commerce Bancshares Inc. |
37,157 | 2,313,023 | ||||||
|
Cullen/Frost Bankers Inc. |
20,744 | 1,457,681 | ||||||
|
East West Bancorp. Inc. |
52,263 | 1,906,554 | ||||||
|
Fifth Third Bancorp. |
264,104 | 6,132,495 | ||||||
|
First Citizens BancShares Inc./NC, Class A |
2,673 | 1,236,797 | ||||||
|
First Financial Bankshares Inc. |
52,407 | 1,562,253 | ||||||
|
First Horizon National Corp. |
204,687 | 2,130,792 | ||||||
|
First Republic Bank/CA |
63,823 | 8,050,633 | ||||||
|
FNB Corp. |
119,559 | 903,866 | ||||||
|
Glacier Bancorp. Inc. |
35,448 | 1,269,038 | ||||||
|
Home BancShares Inc./AR |
56,638 | 940,191 | ||||||
|
Huntington Bancshares Inc./OH |
377,278 | 3,938,782 | ||||||
|
JPMorgan Chase & Co. |
1,130,073 | 110,792,357 | ||||||
|
KeyCorp. |
361,907 | 4,697,553 | ||||||
|
M&T Bank Corp. |
47,567 | 4,926,990 | ||||||
|
People’s United Financial Inc. |
156,897 | 1,674,091 | ||||||
|
Pinnacle Financial Partners Inc. |
28,190 | 1,290,820 | ||||||
|
PNC Financial Services Group Inc. (The) |
157,409 | 17,610,919 | ||||||
|
Popular Inc. |
31,328 | 1,322,042 | ||||||
|
Prosperity Bancshares Inc. |
34,263 | 1,888,234 | ||||||
|
Regions Financial Corp. |
356,036 | 4,735,279 | ||||||
|
Signature Bank/New York NY |
19,845 | 1,602,285 | ||||||
|
SVB Financial Group(a) |
19,171 | 5,573,010 | ||||||
|
Synovus Financial Corp. |
54,375 | 1,413,750 | ||||||
|
TCF Financial Corp. |
56,619 | 1,540,603 | ||||||
|
Truist Financial Corp. |
499,703 | 21,047,490 | ||||||
|
U.S. Bancorp. |
508,298 | 19,798,207 | ||||||
|
UMB Financial Corp. |
16,084 | 979,033 | ||||||
|
Umpqua Holdings Corp. |
81,445 | 1,022,949 | ||||||
|
United Bankshares Inc./WV |
48,195 | 1,264,155 | ||||||
|
Valley National Bancorp. |
150,093 | 1,146,710 | ||||||
|
Webster Financial Corp. |
33,614 | 1,082,707 | ||||||
|
Wells Fargo & Co. |
1,527,741 | 32,770,044 | ||||||
|
Western Alliance Bancorp. |
37,503 | 1,545,124 | ||||||
|
Wintrust Financial Corp. |
21,296 | 1,048,402 | ||||||
|
Zions Bancorp NA |
60,669 | 1,957,789 | ||||||
|
|
|
|||||||
| 381,985,896 | ||||||||
| Capital Markets — 31.5% | ||||||||
|
Affiliated Managers Group Inc. |
17,253 | 1,300,359 | ||||||
|
Ameriprise Financial Inc. |
44,597 | 7,172,535 | ||||||
|
Apollo Global Management Inc. |
77,193 | 2,845,334 | ||||||
|
Ares Management Corp., Class A |
35,111 | 1,485,195 | ||||||
|
Bank of New York Mellon Corp. (The) |
302,205 | 10,383,764 | ||||||
|
BlackRock Inc.(b) |
52,584 | 31,508,859 | ||||||
|
Blackstone Group Inc. (The), Class A |
248,830 | 12,546,009 | ||||||
|
Carlyle Group Inc. (The) |
42,768 | 1,065,779 | ||||||
|
Cboe Global Markets Inc. |
40,257 | 3,272,491 | ||||||
|
Charles Schwab Corp. (The) |
549,585 | 22,593,439 | ||||||
|
CME Group Inc. |
132,980 | 20,042,746 | ||||||
|
Eaton Vance Corp., NVS |
42,363 | 2,532,884 | ||||||
|
FactSet Research Systems Inc. |
14,088 | 4,317,972 | ||||||
|
Federated Hermes Inc. |
35,497 | 848,378 | ||||||
| Security | Shares | Value | ||||||
| Capital Markets (continued) | ||||||||
|
Franklin Resources Inc. |
98,901 | $ | 1,854,394 | |||||
|
Goldman Sachs Group Inc. (The) |
127,586 | 24,118,857 | ||||||
|
Interactive Brokers Group Inc., Class A |
29,403 | 1,398,701 | ||||||
|
Intercontinental Exchange Inc. |
208,115 | 19,646,056 | ||||||
|
Invesco Ltd. |
139,696 | 1,831,415 | ||||||
|
Janus Henderson Group PLC |
56,018 | 1,361,237 | ||||||
|
Lazard Ltd., Class A |
41,646 | 1,402,221 | ||||||
|
LPL Financial Holdings Inc. |
29,241 | 2,337,233 | ||||||
|
MarketAxess Holdings Inc. |
14,080 | 7,587,008 | ||||||
|
Moody’s Corp. |
59,856 | 15,736,142 | ||||||
|
Morgan Stanley |
529,456 | 25,493,306 | ||||||
|
Morningstar Inc. |
8,006 | 1,524,182 | ||||||
|
MSCI Inc. |
31,013 | 10,849,588 | ||||||
|
Nasdaq Inc. |
42,636 | 5,158,530 | ||||||
|
Northern Trust Corp. |
77,162 | 6,039,470 | ||||||
|
Raymond James Financial Inc. |
45,265 | 3,460,057 | ||||||
|
S&P Global Inc. |
89,364 | 28,840,444 | ||||||
|
SEI Investments Co. |
44,955 | 2,209,538 | ||||||
|
State Street Corp. |
130,666 | 7,696,227 | ||||||
|
Stifel Financial Corp. |
25,515 | 1,491,607 | ||||||
|
T Rowe Price Group Inc. |
84,168 | 10,660,719 | ||||||
|
Tradeweb Markets Inc., Class A |
33,565 | 1,828,621 | ||||||
|
Virtu Financial Inc., Class A |
30,051 | 642,490 | ||||||
|
|
|
|||||||
| 305,083,787 | ||||||||
| Consumer Finance — 5.9% | ||||||||
|
Ally Financial Inc. |
138,630 | 3,698,649 | ||||||
|
American Express Co. |
241,833 | 22,064,843 | ||||||
|
Capital One Financial Corp. |
169,324 | 12,374,198 | ||||||
|
Credit Acceptance Corp.(a)(c) |
4,519 | 1,347,204 | ||||||
|
Discover Financial Services |
113,623 | 7,386,631 | ||||||
|
FirstCash Inc. |
15,309 | 796,680 | ||||||
|
Green Dot Corp., Class A(a) |
19,995 | 1,066,134 | ||||||
|
LendingTree Inc.(a)(c) |
2,921 | 945,206 | ||||||
|
OneMain Holdings Inc. |
27,795 | 969,768 | ||||||
|
Santander Consumer USA Holdings Inc. |
26,973 | 548,631 | ||||||
|
SLM Corp. |
138,548 | 1,273,256 | ||||||
|
Synchrony Financial |
201,308 | 5,036,726 | ||||||
|
|
|
|||||||
| 57,507,926 | ||||||||
| Diversified Financial Services — 0.3% | ||||||||
|
Equitable Holdings Inc. |
149,607 | 3,215,054 | ||||||
|
|
|
|||||||
| Insurance — 0.4% | ||||||||
|
Fidelity National Financial Inc. |
109,357 | 3,421,781 | ||||||
|
|
|
|||||||
| IT Services — 21.5% | ||||||||
|
Mastercard Inc., Class A |
327,555 | 94,545,475 | ||||||
|
Visa Inc., Class A |
625,183 | 113,602,003 | ||||||
|
|
|
|||||||
| 208,147,478 | ||||||||
| Thrifts & Mortgage Finance — 0.7% | ||||||||
|
Essent Group Ltd. |
41,547 | 1,655,648 | ||||||
|
MGIC Investment Corp. |
125,011 | 1,257,611 | ||||||
|
New York Community Bancorp. Inc. |
171,315 | 1,423,628 | ||||||
|
Radian Group Inc. |
71,199 | 1,278,022 | ||||||
|
Rocket Companies Inc., Class A(a)(c) |
37,394 | 681,692 | ||||||
|
TFS Financial Corp. |
17,734 | 278,601 | ||||||
|
|
|
|||||||
| 6,575,202 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
965,937,124 | |||||||
|
|
|
|||||||
|
S C H E D U L E O F I N V E S T M E N T S |
21 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Financial Services ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.4% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(b)(d)(e) |
3,056,872 | $ | 3,059,011 | |||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(d) |
1,119,000 | 1,119,000 | ||||||
|
|
|
|||||||
| 4,178,011 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.4%
|
|
4,178,011 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.2%
|
|
970,115,135 | ||||||
|
Other Assets, Less Liabilities — (0.2)% |
|
(1,873,538 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 968,241,597 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
All or a portion of this security is on loan. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 195,785 | $ | 2,886,701 | (a) | $ | — | $ | (23,114 | ) | $ | (361 | ) | $ | 3,059,011 | 3,056,872 | $ | 58,875 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,109,000 | 10,000 | (a) | — | — | — | 1,119,000 | 1,119,000 | 1,871 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
19,996,755 | 42,076,589 | (38,665,276 | ) | 5,796,344 | 2,304,447 | 31,508,859 | 52,584 | 594,576 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 5,773,230 | $ | 2,304,086 | $ | 35,686,870 | $ | 655,322 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
(000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Financial E-Mini Index |
30 | 12/18/20 | $ | 2,196 | $ | (46,507 | ) | |||||||||
|
|
|
|||||||||||||||
| 22 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Financial Services ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 46,507 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 868,646 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (223,208 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 3,529,425 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 965,937,124 | $ | — | $ | — | $ | 965,937,124 | ||||||||
|
Money Market Funds |
4,178,011 | — | — | 4,178,011 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 970,115,135 | $ | — | $ | — | $ | 970,115,135 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (46,507 | ) | $ | — | $ | — | $ | (46,507) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
23 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Financials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Banks — 22.3% | ||||||||
|
Bank of America Corp. |
1,969,098 | $ | 46,667,623 | |||||
|
Bank OZK |
30,991 | 767,957 | ||||||
|
BOK Financial Corp. |
7,993 | 469,509 | ||||||
|
Citigroup Inc. |
537,668 | 22,270,209 | ||||||
|
Citizens Financial Group Inc. |
110,327 | 3,006,411 | ||||||
|
Comerica Inc. |
35,983 | 1,637,586 | ||||||
|
Commerce Bancshares Inc. |
25,983 | 1,617,442 | ||||||
|
Cullen/Frost Bankers Inc. |
14,330 | 1,006,969 | ||||||
|
East West Bancorp. Inc. |
36,315 | 1,324,771 | ||||||
|
Fifth Third Bancorp. |
183,902 | 4,270,204 | ||||||
|
First Citizens BancShares Inc./NC, Class A |
1,867 | 863,861 | ||||||
|
First Financial Bankshares Inc. |
36,454 | 1,086,694 | ||||||
|
First Horizon National Corp. |
142,387 | 1,482,249 | ||||||
|
First Republic Bank/CA |
44,406 | 5,601,373 | ||||||
|
FNB Corp. |
84,064 | 635,524 | ||||||
|
Glacier Bancorp. Inc. |
24,700 | 884,260 | ||||||
|
Home BancShares Inc./AR |
39,168 | 650,189 | ||||||
|
Huntington Bancshares Inc./OH |
263,069 | 2,746,440 | ||||||
|
JPMorgan Chase & Co. |
769,878 | 75,478,839 | ||||||
|
KeyCorp. |
252,194 | 3,273,478 | ||||||
|
M&T Bank Corp. |
33,144 | 3,433,055 | ||||||
|
People’s United Financial Inc. |
109,023 | 1,163,275 | ||||||
|
Pinnacle Financial Partners Inc. |
19,638 | 899,224 | ||||||
|
PNC Financial Services Group Inc. (The) |
109,633 | 12,265,740 | ||||||
|
Popular Inc. |
21,808 | 920,298 | ||||||
|
Prosperity Bancshares Inc. |
23,983 | 1,321,703 | ||||||
|
Regions Financial Corp. |
248,085 | 3,299,530 | ||||||
|
Signature Bank/New York NY |
13,794 | 1,113,728 | ||||||
|
SVB Financial Group(a) |
13,371 | 3,886,950 | ||||||
|
Synovus Financial Corp. |
37,735 | 981,110 | ||||||
|
TCF Financial Corp. |
39,412 | 1,072,401 | ||||||
|
Truist Financial Corp. |
348,037 | 14,659,318 | ||||||
|
U.S. Bancorp. |
354,024 | 13,789,235 | ||||||
|
UMB Financial Corp. |
11,198 | 681,622 | ||||||
|
Umpqua Holdings Corp. |
57,092 | 717,076 | ||||||
|
United Bankshares Inc./WV |
33,588 | 881,013 | ||||||
|
Valley National Bancorp. |
104,535 | 798,647 | ||||||
|
Webster Financial Corp. |
23,249 | 748,850 | ||||||
|
Wells Fargo & Co. |
1,064,054 | 22,823,958 | ||||||
|
Western Alliance Bancorp. |
26,099 | 1,075,279 | ||||||
|
Wintrust Financial Corp. |
14,876 | 732,345 | ||||||
|
Zions Bancorp NA |
42,459 | 1,370,152 | ||||||
|
|
|
|||||||
| 264,376,097 | ||||||||
| Capital Markets — 18.4% | ||||||||
|
Affiliated Managers Group Inc. |
11,986 | 903,385 | ||||||
|
Ameriprise Financial Inc. |
31,033 | 4,991,037 | ||||||
|
Apollo Global Management Inc. |
53,703 | 1,979,493 | ||||||
|
Ares Management Corp., Class A |
24,468 | 1,034,996 | ||||||
|
Bank of New York Mellon Corp. (The) |
210,273 | 7,224,980 | ||||||
|
BlackRock Inc.(b) |
36,624 | 21,945,467 | ||||||
|
Blackstone Group Inc. (The), Class A |
173,364 | 8,741,013 | ||||||
|
Carlyle Group Inc. (The) |
29,788 | 742,317 | ||||||
|
Cboe Global Markets Inc. |
28,004 | 2,276,445 | ||||||
|
Charles Schwab Corp. (The) |
382,707 | 15,733,085 | ||||||
|
CME Group Inc. |
92,619 | 13,959,536 | ||||||
|
Eaton Vance Corp., NVS |
29,564 | 1,767,632 | ||||||
|
FactSet Research Systems Inc. |
9,820 | 3,009,830 | ||||||
|
Federated Hermes Inc. |
24,800 | 592,720 | ||||||
| Security | Shares | Value | ||||||
| Capital Markets (continued) | ||||||||
|
Franklin Resources Inc. |
69,175 | $ | 1,297,031 | |||||
|
Goldman Sachs Group Inc. (The) |
88,862 | 16,798,472 | ||||||
|
Interactive Brokers Group Inc., Class A |
20,467 | 973,615 | ||||||
|
Intercontinental Exchange Inc. |
144,949 | 13,683,186 | ||||||
|
Invesco Ltd. |
97,517 | 1,278,448 | ||||||
|
Janus Henderson Group PLC |
38,806 | 942,986 | ||||||
|
KKR & Co. Inc. |
144,289 | 4,927,469 | ||||||
|
Lazard Ltd., Class A |
29,194 | 982,962 | ||||||
|
LPL Financial Holdings Inc. |
20,471 | 1,636,247 | ||||||
|
MarketAxess Holdings Inc. |
9,800 | 5,280,730 | ||||||
|
Moody’s Corp. |
41,689 | 10,960,038 | ||||||
|
Morgan Stanley |
368,760 | 17,755,794 | ||||||
|
Morningstar Inc. |
5,557 | 1,057,942 | ||||||
|
MSCI Inc. |
21,582 | 7,550,247 | ||||||
|
Nasdaq Inc. |
29,703 | 3,593,766 | ||||||
|
Northern Trust Corp. |
53,719 | 4,204,586 | ||||||
|
Raymond James Financial Inc. |
31,424 | 2,402,051 | ||||||
|
S&P Global Inc. |
62,241 | 20,087,038 | ||||||
|
SEI Investments Co. |
31,460 | 1,546,259 | ||||||
|
State Street Corp. |
90,914 | 5,354,835 | ||||||
|
Stifel Financial Corp. |
17,775 | 1,039,126 | ||||||
|
T Rowe Price Group Inc. |
58,563 | 7,417,590 | ||||||
|
Tradeweb Markets Inc., Class A |
23,486 | 1,279,517 | ||||||
|
Virtu Financial Inc., Class A |
20,946 | 447,825 | ||||||
|
|
|
|||||||
| 217,399,696 | ||||||||
| Consumer Finance — 3.4% | ||||||||
|
Ally Financial Inc. |
96,688 | 2,579,636 | ||||||
|
American Express Co. |
168,434 | 15,367,918 | ||||||
|
Capital One Financial Corp. |
117,977 | 8,621,759 | ||||||
|
Credit Acceptance Corp.(a)(c) |
3,150 | 939,078 | ||||||
|
Discover Financial Services |
79,085 | 5,141,316 | ||||||
|
FirstCash Inc. |
10,734 | 558,598 | ||||||
|
Green Dot Corp., Class A(a) |
14,376 | 766,528 | ||||||
|
LendingTree Inc.(a)(c) |
2,031 | 657,211 | ||||||
|
OneMain Holdings Inc. |
19,405 | 677,041 | ||||||
|
Santander Consumer USA Holdings Inc. |
18,800 | 382,392 | ||||||
|
SLM Corp. |
96,912 | 890,621 | ||||||
|
Synchrony Financial |
140,197 | 3,507,729 | ||||||
|
|
|
|||||||
| 40,089,827 | ||||||||
| Diversified Financial Services — 8.9% | ||||||||
|
Berkshire Hathaway Inc., Class B(a) |
500,743 | 101,100,012 | ||||||
|
Equitable Holdings Inc. |
104,619 | 2,248,262 | ||||||
|
Voya Financial Inc. |
32,663 | 1,565,538 | ||||||
|
|
|
|||||||
| 104,913,812 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 20.5% | ||||||||
|
Alexandria Real Estate Equities Inc. |
30,274 | 4,587,117 | ||||||
|
American Campus Communities Inc. |
35,653 | 1,335,561 | ||||||
|
American Homes 4 Rent, Class A |
68,577 | 1,938,672 | ||||||
|
American Tower Corp. |
114,558 | 26,308,245 | ||||||
|
Americold Realty Trust |
52,372 | 1,897,438 | ||||||
|
Apartment Investment & Management Co., Class A |
38,553 | 1,229,841 | ||||||
|
AvalonBay Communities Inc. |
36,321 | 5,053,341 | ||||||
|
Boston Properties Inc. |
36,629 | 2,652,306 | ||||||
|
Brixmor Property Group Inc. |
76,240 | 835,590 | ||||||
|
Camden Property Trust |
25,073 | 2,312,734 | ||||||
|
CoreSite Realty Corp. |
11,001 | 1,313,079 | ||||||
|
Corporate Office Properties Trust |
28,796 | 645,894 | ||||||
|
Cousins Properties Inc. |
38,099 | 970,763 | ||||||
|
Crown Castle International Corp. |
108,385 | 16,929,737 | ||||||
| 24 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Financials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Equity Real Estate Investment Trusts (REITs) (continued) | ||||||||
|
CubeSmart |
50,142 | $ | 1,701,318 | |||||
|
CyrusOne Inc. |
30,091 | 2,137,966 | ||||||
|
Digital Realty Trust Inc. |
69,480 | 10,025,964 | ||||||
|
Douglas Emmett Inc. |
42,288 | 997,997 | ||||||
|
Duke Realty Corp. |
95,727 | 3,636,669 | ||||||
|
EastGroup Properties Inc. |
10,174 | 1,353,956 | ||||||
|
Equinix Inc. |
22,871 | 16,724,190 | ||||||
|
Equity Commonwealth |
31,202 | 824,357 | ||||||
|
Equity LifeStyle Properties Inc. |
43,810 | 2,593,114 | ||||||
|
Equity Residential |
88,398 | 4,152,938 | ||||||
|
Essex Property Trust Inc. |
16,852 | 3,447,751 | ||||||
|
Extra Space Storage Inc. |
33,332 | 3,864,845 | ||||||
|
Federal Realty Investment Trust |
17,814 | 1,225,247 | ||||||
|
First Industrial Realty Trust Inc. |
32,940 | 1,311,341 | ||||||
|
Gaming and Leisure Properties Inc. |
53,659 | 1,950,505 | ||||||
|
Healthcare Realty Trust Inc. |
35,226 | 979,283 | ||||||
|
Healthcare Trust of America Inc., Class A |
56,569 | 1,374,627 | ||||||
|
Healthpeak Properties Inc. |
139,040 | 3,749,909 | ||||||
|
Highwoods Properties Inc. |
26,759 | 796,615 | ||||||
|
Host Hotels & Resorts Inc. |
181,430 | 1,901,386 | ||||||
|
Hudson Pacific Properties Inc. |
39,347 | 757,823 | ||||||
|
Invitation Homes Inc. |
144,745 | 3,945,749 | ||||||
|
Iron Mountain Inc. |
74,157 | 1,932,531 | ||||||
|
JBG SMITH Properties |
29,089 | 679,228 | ||||||
|
Kilroy Realty Corp. |
26,942 | 1,268,429 | ||||||
|
Kimco Realty Corp. |
112,071 | 1,149,848 | ||||||
|
Lamar Advertising Co., Class A |
22,184 | 1,374,521 | ||||||
|
Lexington Realty Trust |
71,151 | 706,529 | ||||||
|
Life Storage Inc. |
12,149 | 1,386,808 | ||||||
|
Medical Properties Trust Inc. |
136,146 | 2,426,122 | ||||||
|
Mid-America Apartment Communities Inc. |
29,542 | 3,445,484 | ||||||
|
National Health Investors Inc. |
11,563 | 648,106 | ||||||
|
National Retail Properties Inc. |
44,582 | 1,427,070 | ||||||
|
Omega Healthcare Investors Inc. |
58,362 | 1,681,409 | ||||||
|
Physicians Realty Trust |
53,885 | 908,501 | ||||||
|
PotlatchDeltic Corp. |
17,218 | 715,408 | ||||||
|
Prologis Inc. |
190,796 | 18,926,963 | ||||||
|
PS Business Parks Inc. |
5,180 | 590,675 | ||||||
|
Public Storage |
39,291 | 9,000,389 | ||||||
|
Rayonier Inc. |
35,138 | 891,802 | ||||||
|
Realty Income Corp. |
89,038 | 5,151,739 | ||||||
|
Regency Centers Corp. |
40,835 | 1,453,318 | ||||||
|
Rexford Industrial Realty Inc. |
32,035 | 1,488,346 | ||||||
|
Sabra Health Care REIT Inc. |
52,998 | 697,454 | ||||||
|
SBA Communications Corp. |
28,917 | 8,396,629 | ||||||
|
Simon Property Group Inc. |
78,940 | 4,958,221 | ||||||
|
SL Green Realty Corp. |
18,964 | 811,849 | ||||||
|
Spirit Realty Capital Inc. |
26,464 | 795,243 | ||||||
|
STORE Capital Corp. |
59,052 | 1,517,636 | ||||||
|
Sun Communities Inc. |
25,388 | 3,494,150 | ||||||
|
Taubman Centers Inc. |
16,032 | 535,789 | ||||||
|
UDR Inc. |
75,960 | 2,372,990 | ||||||
|
Ventas Inc. |
96,342 | 3,802,619 | ||||||
|
VEREIT Inc. |
277,133 | 1,718,225 | ||||||
|
VICI Properties Inc. |
137,900 | 3,164,805 | ||||||
|
Vornado Realty Trust |
40,356 | 1,240,140 | ||||||
|
Welltower Inc. |
107,670 | 5,789,416 | ||||||
|
Weyerhaeuser Co. |
192,543 | 5,254,499 | ||||||
|
WP Carey Inc. |
44,966 | 2,815,321 | ||||||
|
|
|
|||||||
| 242,082,080 | ||||||||
| Security | Shares | Value | ||||||
|
Insurance — 13.6% |
||||||||
|
Aflac Inc. |
171,059 | $ | 5,807,453 | |||||
|
Alleghany Corp. |
3,686 | 2,015,984 | ||||||
|
Allstate Corp. (The) |
80,582 | 7,151,652 | ||||||
|
American Financial Group Inc./OH |
18,569 | 1,391,561 | ||||||
|
American International Group Inc. |
222,257 | 6,998,873 | ||||||
|
Aon PLC, Class A |
59,827 | 11,008,766 | ||||||
|
Arch Capital Group Ltd.(a) |
104,904 | 3,169,150 | ||||||
|
Arthur J Gallagher & Co. |
49,416 | 5,124,933 | ||||||
|
Assurant Inc. |
15,341 | 1,907,960 | ||||||
|
Athene Holding Ltd., Class A(a) |
32,694 | 1,048,823 | ||||||
|
Axis Capital Holdings Ltd. |
20,739 | 885,348 | ||||||
|
Brighthouse Financial Inc.(a) |
24,165 | 799,861 | ||||||
|
Brown & Brown Inc. |
60,703 | 2,641,187 | ||||||
|
Chubb Ltd. |
116,571 | 15,143,739 | ||||||
|
Cincinnati Financial Corp. |
38,676 | 2,735,940 | ||||||
|
CNA Financial Corp. |
6,930 | 206,445 | ||||||
|
Enstar Group Ltd.(a) |
3,424 | 588,483 | ||||||
|
Erie Indemnity Co., Class A, NVS |
6,460 | 1,504,340 | ||||||
|
Everest Re Group Ltd. |
10,288 | 2,027,559 | ||||||
|
Fidelity National Financial Inc. |
79,014 | 2,472,348 | ||||||
|
First American Financial Corp. |
28,659 | 1,277,905 | ||||||
|
Globe Life Inc. |
25,220 | 2,045,090 | ||||||
|
Hanover Insurance Group Inc. (The) |
9,770 | 934,598 | ||||||
|
Hartford Financial Services Group Inc. (The) |
92,553 | 3,565,142 | ||||||
|
Kemper Corp. |
15,745 | 970,837 | ||||||
|
Lincoln National Corp. |
47,006 | 1,649,911 | ||||||
|
Loews Corp. |
61,365 | 2,128,138 | ||||||
|
Markel Corp.(a) |
3,557 | 3,317,970 | ||||||
|
Marsh & McLennan Companies Inc. |
130,817 | 13,534,327 | ||||||
|
Mercury General Corp. |
6,845 | 278,660 | ||||||
|
MetLife Inc. |
199,048 | 7,533,967 | ||||||
|
Old Republic International Corp. |
73,256 | 1,192,608 | ||||||
|
Primerica Inc. |
10,232 | 1,127,976 | ||||||
|
Principal Financial Group Inc. |
66,027 | 2,589,579 | ||||||
|
Progressive Corp. (The) |
151,186 | 13,893,993 | ||||||
|
Prudential Financial Inc. |
101,916 | 6,524,662 | ||||||
|
Reinsurance Group of America Inc. |
17,583 | 1,776,235 | ||||||
|
RenaissanceRe Holdings Ltd. |
13,186 | 2,132,440 | ||||||
|
RLI Corp. |
10,127 | 878,011 | ||||||
|
Selective Insurance Group Inc. |
15,528 | 808,388 | ||||||
|
Travelers Companies Inc. (The) |
65,418 | 7,896,607 | ||||||
|
Unum Group |
52,734 | 931,282 | ||||||
|
White Mountains Insurance Group Ltd. |
800 | 726,664 | ||||||
|
Willis Towers Watson PLC |
33,247 | 6,066,912 | ||||||
|
WR Berkley Corp. |
36,202 | 2,176,464 | ||||||
|
|
|
|||||||
| 160,588,771 | ||||||||
| IT Services — 10.5% | ||||||||
|
Mastercard Inc., Class A |
164,508 | 47,483,589 | ||||||
|
Visa Inc., Class A |
425,915 | 77,393,015 | ||||||
|
|
|
|||||||
| 124,876,604 | ||||||||
| Mortgage Real Estate Investment — 0.6% | ||||||||
|
AGNC Investment Corp. |
143,628 | 2,006,483 | ||||||
|
Annaly Capital Management Inc. |
362,820 | 2,572,394 | ||||||
|
Blackstone Mortgage Trust Inc., Class A |
37,456 | 812,795 | ||||||
|
New Residential Investment Corp. |
107,058 | 802,935 | ||||||
|
Starwood Property Trust Inc. |
73,639 | 1,028,737 | ||||||
|
|
|
|||||||
| 7,223,344 | ||||||||
| Professional Services — 0.7% | ||||||||
|
CoStar Group Inc.(a) |
10,168 | 8,374,466 | ||||||
|
|
|
|||||||
|
S C H E D U L E O F I N V E S T M E N T S |
25 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Financials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Real Estate Management & Development — 0.5% | ||||||||
|
CBRE Group Inc., Class A(a) |
86,574 | $ | 4,363,329 | |||||
|
Howard Hughes Corp. (The)(a) |
11,635 | 723,581 | ||||||
|
Jones Lang LaSalle Inc. |
13,393 | 1,511,534 | ||||||
|
|
|
|||||||
| 6,598,444 | ||||||||
| Thrifts & Mortgage Finance — 0.4% | ||||||||
|
Essent Group Ltd. |
29,100 | 1,159,635 | ||||||
|
MGIC Investment Corp. |
87,329 | 878,530 | ||||||
|
New York Community Bancorp. Inc. |
120,098 | 998,014 | ||||||
|
Radian Group Inc. |
49,310 | 885,115 | ||||||
|
Rocket Companies Inc., Class A(a)(c) |
26,087 | 475,566 | ||||||
|
TFS Financial Corp. |
12,328 | 193,673 | ||||||
|
|
|
|||||||
| 4,590,533 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
1,181,113,674 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.3% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
2,058,099 | 2,059,539 | ||||||
| Security | Shares | Value | ||||||
| Money Market Funds (continued) | ||||||||
|
BlackRock Cash Funds: Treasury,
|
1,703,000 | $ | 1,703,000 | |||||
|
|
|
|||||||
| 3,762,539 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.3%
|
|
3,762,539 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.1%
|
|
1,184,876,213 | ||||||
|
Other Assets, Less Liabilities — (0.1)% |
|
(1,591,666 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,183,284,547 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
All or a portion of this security is on loan. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 30,405 | $ | 2,037,648 | (a) | $ | — | $ | (8,308 | ) | $ | (206 | ) | $ | 2,059,539 | 2,058,099 | $ | 25,576 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,623,000 | 80,000 | (a) | — | — | — | 1,703,000 | 1,703,000 | 1,660 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
16,255,051 | 16,950,114 | (14,784,237 | ) | 1,205,563 | 2,318,976 | 21,945,467 | 36,624 | 305,639 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 1,197,255 | $ | 2,318,770 | $ | 25,708,006 | $ | 332,875 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
Dow Jones U.S. Real Estate Index |
18 | 12/18/20 | $ | 546 | $ | (29,949 | ) | |||||||||
|
S&P Select Sector Financial E-Mini Index |
21 | 12/18/20 | 1,537 | (42,310 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (72,259 | ) | ||||||||||||||
|
|
|
|||||||||||||||
| 26 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Financials ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 72,259 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 604,423 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (293,888 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 2,661,886 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,181,113,674 | $ | — | $ | — | $ | 1,181,113,674 | ||||||||
|
Money Market Funds |
3,762,539 | — | — | 3,762,539 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,184,876,213 | $ | — | $ | — | $ | 1,184,876,213 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (72,259 | ) | $ | — | $ | — | $ | (72,259 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
27 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Industrials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Aerospace & Defense — 12.2% | ||||||||
|
Axon Enterprise Inc.(a) |
16,235 | $ | 1,605,641 | |||||
|
Boeing Co. (The) |
135,506 | 19,565,711 | ||||||
|
BWX Technologies Inc. |
24,379 | 1,341,089 | ||||||
|
Curtiss-Wright Corp. |
10,569 | 891,601 | ||||||
|
General Dynamics Corp. |
59,385 | 7,799,032 | ||||||
|
HEICO Corp. |
10,813 | 1,135,906 | ||||||
|
HEICO Corp., Class A |
18,761 | 1,754,153 | ||||||
|
Hexcel Corp. |
21,281 | 712,488 | ||||||
|
Howmet Aerospace Inc. |
100,420 | 1,732,245 | ||||||
|
Huntington Ingalls Industries Inc. |
10,360 | 1,527,893 | ||||||
|
L3Harris Technologies Inc. |
55,234 | 8,898,750 | ||||||
|
Lockheed Martin Corp. |
62,825 | 21,996,917 | ||||||
|
Mercury Systems Inc.(a) |
14,329 | 986,982 | ||||||
|
Northrop Grumman Corp. |
39,601 | 11,477,162 | ||||||
|
Raytheon Technologies Corp. |
390,149 | 21,192,894 | ||||||
|
Teledyne Technologies Inc.(a) |
9,428 | 2,914,666 | ||||||
|
Textron Inc. |
58,348 | 2,088,858 | ||||||
|
TransDigm Group Inc. |
13,851 | 6,612,606 | ||||||
|
|
|
|||||||
| 114,234,594 | ||||||||
| Air Freight & Logistics — 5.7% | ||||||||
|
CH Robinson Worldwide Inc. |
34,402 | 3,042,169 | ||||||
|
Expeditors International of Washington Inc. |
42,782 | 3,780,645 | ||||||
|
FedEx Corp. |
61,559 | 15,972,714 | ||||||
|
United Parcel Service Inc., Class B |
180,582 | 28,371,238 | ||||||
|
XPO Logistics Inc.(a) |
23,358 | 2,102,220 | ||||||
|
|
|
|||||||
| 53,268,986 | ||||||||
| Building Products — 4.3% | ||||||||
|
A O Smith Corp. |
34,634 | 1,790,231 | ||||||
|
Allegion PLC |
23,595 | 2,324,108 | ||||||
|
Armstrong World Industries Inc. |
12,272 | 735,093 | ||||||
|
Carrier Global Corp. |
207,794 | 6,938,242 | ||||||
|
Fortune Brands Home & Security Inc. |
35,228 | 2,848,888 | ||||||
|
Johnson Controls International PLC |
190,115 | 8,024,754 | ||||||
|
Lennox International Inc. |
8,872 | 2,410,168 | ||||||
|
Masco Corp. |
66,742 | 3,577,371 | ||||||
|
Owens Corning |
27,631 | 1,809,002 | ||||||
|
Trane Technologies PLC |
61,159 | 8,118,857 | ||||||
|
Trex Co. Inc.(a) |
29,608 | 2,058,940 | ||||||
|
|
|
|||||||
| 40,635,654 | ||||||||
| Chemicals — 1.5% | ||||||||
|
Sherwin-Williams Co. (The) |
20,928 | 14,398,045 | ||||||
|
|
|
|||||||
| Commercial Services & Supplies — 3.0% | ||||||||
|
ADT Inc. |
38,831 | 255,896 | ||||||
|
Cimpress PLC(a) |
4,970 | 364,798 | ||||||
|
Cintas Corp. |
22,191 | 6,980,179 | ||||||
|
Clean Harbors Inc.(a) |
13,096 | 693,695 | ||||||
|
MSA Safety Inc. |
9,250 | 1,220,260 | ||||||
|
Republic Services Inc. |
53,650 | 4,730,321 | ||||||
|
Stericycle Inc.(a) |
23,401 | 1,457,882 | ||||||
|
Tetra Tech Inc. |
13,746 | 1,387,109 | ||||||
|
Waste Management Inc. |
99,279 | 10,713,197 | ||||||
|
|
|
|||||||
| 27,803,337 | ||||||||
| Construction & Engineering — 1.0% | ||||||||
|
AECOM(a) |
41,032 | 1,839,875 | ||||||
|
EMCOR Group Inc. |
14,045 | 957,728 | ||||||
|
Jacobs Engineering Group Inc. |
33,204 | 3,154,380 | ||||||
|
MasTec Inc.(a) |
14,353 | 712,483 | ||||||
| Security | Shares | Value | ||||||
| Construction & Engineering (continued) | ||||||||
|
Quanta Services Inc. |
35,311 | $ | 2,204,466 | |||||
|
Valmont Industries Inc. |
5,424 | 769,937 | ||||||
|
|
|
|||||||
| 9,638,869 | ||||||||
| Construction Materials — 1.1% | ||||||||
|
Eagle Materials Inc. |
10,685 | 910,896 | ||||||
|
Martin Marietta Materials Inc. |
15,884 | 4,230,704 | ||||||
|
Vulcan Materials Co. |
33,806 | 4,896,461 | ||||||
|
|
|
|||||||
| 10,038,061 | ||||||||
| Containers & Packaging — 3.7% | ||||||||
|
Amcor PLC |
400,292 | 4,175,046 | ||||||
|
AptarGroup Inc. |
16,496 | 1,882,029 | ||||||
|
Avery Dennison Corp. |
21,345 | 2,953,935 | ||||||
|
Ball Corp. |
83,449 | 7,426,961 | ||||||
|
Berry Global Group Inc.(a) |
33,942 | 1,582,715 | ||||||
|
Crown Holdings Inc.(a) |
34,454 | 2,956,153 | ||||||
|
Graphic Packaging Holding Co. |
71,508 | 950,341 | ||||||
|
International Paper Co. |
100,322 | 4,389,087 | ||||||
|
Packaging Corp. of America |
24,174 | 2,767,681 | ||||||
|
Sealed Air Corp. |
39,823 | 1,576,593 | ||||||
|
Silgan Holdings Inc. |
20,143 | 693,926 | ||||||
|
Sonoco Products Co. |
25,677 | 1,255,349 | ||||||
|
Westrock Co. |
66,406 | 2,493,545 | ||||||
|
|
|
|||||||
| 35,103,361 | ||||||||
| Electrical Equipment — 4.7% | ||||||||
|
Acuity Brands Inc. |
10,096 | 899,957 | ||||||
|
AMETEK Inc. |
58,604 | 5,754,913 | ||||||
|
Eaton Corp. PLC |
102,204 | 10,607,753 | ||||||
|
Emerson Electric Co. |
152,660 | 9,890,841 | ||||||
|
EnerSys |
10,793 | 772,779 | ||||||
|
Generac Holdings Inc.(a) |
16,052 | 3,373,328 | ||||||
|
Hubbell Inc. |
13,872 | 2,018,515 | ||||||
|
nVent Electric PLC |
43,470 | 784,633 | ||||||
|
Regal Beloit Corp. |
10,392 | 1,025,171 | ||||||
|
Rockwell Automation Inc. |
29,599 | 7,018,515 | ||||||
|
Sensata Technologies Holding PLC(a) |
40,221 | 1,758,060 | ||||||
|
|
|
|||||||
| 43,904,465 | ||||||||
| Electronic Equipment, Instruments & Components — 5.3% | ||||||||
|
Amphenol Corp., Class A |
76,234 | 8,602,245 | ||||||
|
Arrow Electronics Inc.(a) |
19,813 | 1,543,235 | ||||||
|
Avnet Inc. |
25,044 | 617,835 | ||||||
|
Cognex Corp. |
44,117 | 2,907,310 | ||||||
|
Coherent Inc.(a) |
6,225 | 778,996 | ||||||
|
Corning Inc. |
194,207 | 6,208,798 | ||||||
|
Dolby Laboratories Inc., Class A |
16,484 | 1,237,619 | ||||||
|
FLIR Systems Inc. |
33,542 | 1,163,572 | ||||||
|
IPG Photonics Corp.(a) |
9,128 | 1,697,443 | ||||||
|
Itron Inc.(a) |
10,322 | 701,380 | ||||||
|
Jabil Inc. |
34,668 | 1,148,898 | ||||||
|
Keysight Technologies Inc.(a) |
47,761 | 5,008,696 | ||||||
|
Littelfuse Inc. |
6,230 | 1,233,166 | ||||||
|
National Instruments Corp. |
33,625 | 1,051,790 | ||||||
|
TE Connectivity Ltd. |
84,329 | 8,169,794 | ||||||
|
Trimble Inc.(a) |
63,818 | 3,071,560 | ||||||
|
Vontier Corp.(a) |
34,434 | 989,633 | ||||||
|
Zebra Technologies Corp., Class A(a) |
13,605 | 3,858,922 | ||||||
|
|
|
|||||||
| 49,990,892 | ||||||||
| Industrial Conglomerates — 8.7% | ||||||||
|
3M Co. |
147,110 | 23,531,716 | ||||||
|
Carlisle Companies Inc. |
13,918 | 1,724,023 | ||||||
| 28 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Industrials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Industrial Conglomerates (continued) | ||||||||
|
General Electric Co. |
2,235,508 | $ | 16,587,469 | |||||
|
Honeywell International Inc. |
179,229 | 29,563,823 | ||||||
|
Roper Technologies Inc. |
26,746 | 9,931,860 | ||||||
|
|
|
|||||||
| 81,338,891 | ||||||||
| IT Services — 21.1% | ||||||||
|
Accenture PLC, Class A |
162,479 | 35,243,320 | ||||||
|
Automatic Data Processing Inc. |
109,809 | 17,345,430 | ||||||
|
Black Knight Inc.(a) |
40,058 | 3,523,101 | ||||||
|
Broadridge Financial Solutions Inc. |
29,391 | 4,044,202 | ||||||
|
Euronet Worldwide Inc.(a) |
13,374 | 1,188,146 | ||||||
|
Fidelity National Information Services Inc. |
158,241 | 19,715,246 | ||||||
|
Fiserv Inc.(a) |
141,949 | 13,551,871 | ||||||
|
FleetCor Technologies Inc.(a) |
21,450 | 4,738,519 | ||||||
|
Genpact Ltd. |
45,387 | 1,559,951 | ||||||
|
Global Payments Inc. |
76,432 | 12,056,384 | ||||||
|
Jack Henry & Associates Inc. |
19,544 | 2,897,398 | ||||||
|
MAXIMUS Inc. |
15,689 | 1,060,263 | ||||||
|
Paychex Inc. |
81,763 | 6,725,007 | ||||||
|
PayPal Holdings Inc.(a) |
299,650 | 55,773,854 | ||||||
|
Square Inc., Class A(a) |
94,825 | 14,686,496 | ||||||
|
Western Union Co. (The) |
104,724 | 2,035,835 | ||||||
|
WEX Inc.(a) |
11,281 | 1,427,610 | ||||||
|
|
|
|||||||
| 197,572,633 | ||||||||
| Life Sciences Tools & Services — 0.4% | ||||||||
|
PerkinElmer Inc. |
28,524 | 3,695,284 | ||||||
|
|
|
|||||||
| Machinery — 14.1% | ||||||||
|
AGCO Corp. |
15,626 | 1,203,671 | ||||||
|
Allison Transmission Holdings Inc. |
28,977 | 1,047,519 | ||||||
|
Caterpillar Inc. |
138,296 | 21,719,387 | ||||||
|
Colfax Corp.(a)(b) |
25,745 | 700,007 | ||||||
|
Crane Co. |
12,500 | 634,375 | ||||||
|
Cummins Inc. |
37,692 | 8,288,094 | ||||||
|
Deere & Co. |
80,033 | 18,080,255 | ||||||
|
Donaldson Co. Inc. |
32,112 | 1,525,320 | ||||||
|
Dover Corp. |
36,740 | 4,067,485 | ||||||
|
Flowserve Corp. |
33,351 | 971,181 | ||||||
|
Fortive Corp. |
86,028 | 5,299,325 | ||||||
|
Gates Industrial Corp. PLC(a) |
11,158 | 123,854 | ||||||
|
Graco Inc. |
42,494 | 2,630,379 | ||||||
|
IDEX Corp. |
19,265 | 3,282,563 | ||||||
|
Illinois Tool Works Inc. |
73,478 | 14,392,871 | ||||||
|
Ingersoll Rand Inc.(a) |
94,692 | 3,308,538 | ||||||
|
ITT Inc. |
22,104 | 1,337,513 | ||||||
|
Lincoln Electric Holdings Inc. |
15,186 | 1,546,239 | ||||||
|
Middleby Corp. (The)(a) |
14,175 | 1,410,979 | ||||||
|
Navistar International Corp.(a) |
12,731 | 548,833 | ||||||
|
Nordson Corp. |
13,760 | 2,661,597 | ||||||
|
Oshkosh Corp. |
17,425 | 1,173,748 | ||||||
|
Otis Worldwide Corp. |
103,892 | 6,366,502 | ||||||
|
PACCAR Inc. |
88,342 | 7,542,640 | ||||||
|
Parker-Hannifin Corp. |
32,812 | 6,836,708 | ||||||
|
Pentair PLC |
42,420 | 2,110,819 | ||||||
|
Snap-on Inc. |
13,931 | 2,194,550 | ||||||
|
Timken Co. (The) |
17,319 | 1,033,944 | ||||||
|
Toro Co. (The) |
27,452 | 2,253,809 | ||||||
|
Westinghouse Air Brake Technologies Corp. |
45,613 | 2,704,851 | ||||||
|
Woodward Inc. |
14,841 | 1,180,602 | ||||||
| Security | Shares | Value | ||||||
| Machinery (continued) | ||||||||
|
Xylem Inc./NY |
45,927 | $ | 4,002,079 | |||||
|
|
|
|||||||
| 132,180,237 | ||||||||
| Marine — 0.1% | ||||||||
|
Kirby Corp.(a) |
15,229 | 586,164 | ||||||
|
|
|
|||||||
| Paper & Forest Products — 0.1% | ||||||||
|
Louisiana-Pacific Corp. |
28,752 | 821,732 | ||||||
|
|
|
|||||||
| Professional Services — 2.6% | ||||||||
|
ASGN Inc.(a) |
13,466 | 897,913 | ||||||
|
CoreLogic Inc. |
20,325 | 1,563,602 | ||||||
|
Equifax Inc. |
30,998 | 4,234,327 | ||||||
|
FTI Consulting Inc.(a) |
9,340 | 919,616 | ||||||
|
Insperity Inc. |
9,238 | 707,446 | ||||||
|
ManpowerGroup Inc. |
14,804 | 1,004,747 | ||||||
|
Nielsen Holdings PLC |
91,270 | 1,233,058 | ||||||
|
Robert Half International Inc. |
29,325 | 1,486,484 | ||||||
|
TransUnion |
48,519 | 3,865,024 | ||||||
|
TriNet Group Inc.(a) |
10,333 | 712,150 | ||||||
|
Verisk Analytics Inc. |
41,447 | 7,376,323 | ||||||
|
|
|
|||||||
| 24,000,690 | ||||||||
| Road & Rail — 7.9% | ||||||||
|
CSX Corp. |
195,387 | 15,423,850 | ||||||
|
JB Hunt Transport Services Inc. |
21,249 | 2,586,853 | ||||||
|
Kansas City Southern |
24,077 | 4,240,923 | ||||||
|
Knight-Swift Transportation Holdings Inc. |
32,224 | 1,224,190 | ||||||
|
Landstar System Inc. |
9,817 | 1,224,180 | ||||||
|
Norfolk Southern Corp. |
65,152 | 13,624,586 | ||||||
|
Old Dominion Freight Line Inc. |
24,551 | 4,673,774 | ||||||
|
Union Pacific Corp. |
173,369 | 30,719,253 | ||||||
|
|
|
|||||||
| 73,717,609 | ||||||||
| Trading Companies & Distributors — 2.3% | ||||||||
|
Air Lease Corp. |
27,361 | 745,314 | ||||||
|
Applied Industrial Technologies Inc. |
9,924 | 605,860 | ||||||
|
Fastenal Co. |
146,395 | 6,328,656 | ||||||
|
HD Supply Holdings Inc.(a) |
41,446 | 1,652,037 | ||||||
|
MSC Industrial Direct Co. Inc., Class A |
11,664 | 812,514 | ||||||
|
SiteOne Landscape Supply Inc.(a)(b) |
11,296 | 1,349,759 | ||||||
|
United Rentals Inc.(a) |
18,382 | 3,277,327 | ||||||
|
Univar Solutions Inc.(a) |
43,247 | 717,468 | ||||||
|
Watsco Inc. |
8,396 | 1,881,879 | ||||||
|
WW Grainger Inc. |
11,486 | 4,020,330 | ||||||
|
|
|
|||||||
| 21,391,144 | ||||||||
| Transportation Infrastructure — 0.1% | ||||||||
|
Macquarie Infrastructure Corp. |
18,700 | 482,460 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
|
934,803,108 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.3% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
1,621,710 | 1,622,845 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
29 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Industrials ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Money Market Funds (continued) | ||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
1,582,000 | $ | 1,582,000 | |||||
|
|
|
|||||||
| 3,204,845 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.3%
|
|
3,204,845 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.2%
|
|
938,007,953 | ||||||
|
Other Assets, Less Liabilities — (0.2)% |
|
(1,896,609 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 936,111,344 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 7,314,249 | $ | — | $ | (5,689,270 | )(a) | $ | 7,658 | $ | (9,792 | ) | $ | 1,622,845 | 1,621,710 | $ | 19,139 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,102,000 | 480,000 | (a) | — | — | — | 1,582,000 | 1,582,000 | 1,134 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 7,658 | $ | (9,792 | ) | $ | 3,204,845 | $ | 20,273 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P Select Sector Industrial E-Mini Index |
13 | 12/18/20 | $ | 990 | $ | (16,740 | ) | |||||||||
|
S&P Select Sector Technology E-Mini Index |
2 | 12/18/20 | 223 | (11,765 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (28,505 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 28,505 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
| 30 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Industrials ETF |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 704,832 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (155,103 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,678,490 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 934,803,108 | $ | — | $ | — | $ | 934,803,108 | ||||||||
|
Money Market Funds |
3,204,845 | — | — | 3,204,845 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 938,007,953 | $ | — | $ | — | $ | 938,007,953 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (28,505 | ) | $ | — | $ | — | $ | (28,505 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
31 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Aerospace & Defense — 0.0% | ||||||||
|
Spirit AeroSystems Holdings Inc., Class A |
15,129 | $ | 275,197 | |||||
|
|
|
|||||||
| Air Freight & Logistics — 0.9% | ||||||||
|
CH Robinson Worldwide Inc. |
19,307 | 1,707,318 | ||||||
|
Echo Global Logistics Inc.(a) |
3,327 | 89,729 | ||||||
|
Expeditors International of Washington Inc. |
23,802 | 2,103,383 | ||||||
|
United Parcel Service Inc., Class B |
100,552 | 15,797,725 | ||||||
|
|
|
|||||||
| 19,698,155 | ||||||||
| Airlines — 0.1% | ||||||||
|
Delta Air Lines Inc. |
22,866 | 700,615 | ||||||
|
Southwest Airlines Co. |
21,074 | 833,055 | ||||||
|
|
|
|||||||
| 1,533,670 | ||||||||
| Auto Components — 0.3% | ||||||||
|
Aptiv PLC |
38,345 | 3,699,909 | ||||||
|
Autoliv Inc. |
11,958 | 906,416 | ||||||
|
BorgWarner Inc. |
34,860 | 1,219,403 | ||||||
|
|
|
|||||||
| 5,825,728 | ||||||||
| Automobiles — 1.9% | ||||||||
|
Harley-Davidson Inc. |
22,081 | 726,023 | ||||||
|
Tesla Inc.(a) |
105,948 | 41,112,062 | ||||||
|
|
|
|||||||
| 41,838,085 | ||||||||
| Banks — 1.5% | ||||||||
|
Bank of Hawaii Corp. |
5,649 | 342,555 | ||||||
|
Cathay General Bancorp. |
10,787 | 253,818 | ||||||
|
CIT Group Inc. |
13,779 | 405,792 | ||||||
|
Citizens Financial Group Inc. |
61,170 | 1,666,883 | ||||||
|
Comerica Inc. |
19,655 | 894,499 | ||||||
|
First Republic Bank/CA |
24,386 | 3,076,050 | ||||||
|
Heartland Financial USA Inc. |
4,342 | 143,026 | ||||||
|
International Bancshares Corp. |
7,705 | 213,274 | ||||||
|
KeyCorp. |
138,782 | 1,801,390 | ||||||
|
M&T Bank Corp. |
18,339 | 1,899,554 | ||||||
|
Old National Bancorp./IN |
23,338 | 326,265 | ||||||
|
People’s United Financial Inc. |
60,709 | 647,765 | ||||||
|
PNC Financial Services Group Inc. (The) |
60,660 | 6,786,641 | ||||||
|
Regions Financial Corp. |
136,994 | 1,822,020 | ||||||
|
Signature Bank/New York NY |
7,643 | 617,096 | ||||||
|
SVB Financial Group(a) |
7,392 | 2,148,854 | ||||||
|
Truist Financial Corp. |
192,501 | 8,108,142 | ||||||
|
Umpqua Holdings Corp. |
30,972 | 389,008 | ||||||
|
Zions Bancorp NA |
23,598 | 761,508 | ||||||
|
|
|
|||||||
| 32,304,140 | ||||||||
| Beverages — 2.5% | ||||||||
|
Coca-Cola Co. (The) |
582,664 | 28,002,832 | ||||||
|
PepsiCo Inc. |
198,142 | 26,410,347 | ||||||
|
|
|
|||||||
| 54,413,179 | ||||||||
| Biotechnology — 3.0% | ||||||||
|
AbbVie Inc. |
252,222 | 21,464,092 | ||||||
|
Amgen Inc. |
84,005 | 18,224,045 | ||||||
|
Biogen Inc.(a) |
23,338 | 5,882,809 | ||||||
|
BioMarin Pharmaceutical Inc.(a) |
25,732 | 1,915,233 | ||||||
|
Gilead Sciences Inc. |
179,228 | 10,422,108 | ||||||
|
Vertex Pharmaceuticals Inc.(a) |
36,969 | 7,702,861 | ||||||
|
|
|
|||||||
| 65,611,148 | ||||||||
| Building Products — 0.8% | ||||||||
|
A O Smith Corp. |
19,445 | 1,005,112 | ||||||
|
Allegion PLC |
13,259 | 1,306,012 | ||||||
| Security | Shares | Value | ||||||
| Building Products (continued) | ||||||||
|
Builders FirstSource Inc.(a) |
16,845 | $ | 510,404 | |||||
|
Fortune Brands Home & Security Inc. |
19,671 | 1,590,794 | ||||||
|
Johnson Controls International PLC |
106,353 | 4,489,160 | ||||||
|
Lennox International Inc. |
4,883 | 1,326,516 | ||||||
|
Masco Corp. |
37,709 | 2,021,202 | ||||||
|
Owens Corning |
15,475 | 1,013,148 | ||||||
|
Trane Technologies PLC |
34,082 | 4,524,385 | ||||||
|
|
|
|||||||
| 17,786,733 | ||||||||
| Capital Markets — 3.4% | ||||||||
|
Ameriprise Financial Inc. |
17,451 | 2,806,644 | ||||||
|
Bank of New York Mellon Corp. (The) |
113,945 | 3,915,150 | ||||||
|
BlackRock Inc.(b) |
21,740 | 13,026,825 | ||||||
|
Charles Schwab Corp. (The) |
218,384 | 8,977,766 | ||||||
|
CME Group Inc. |
51,241 | 7,723,044 | ||||||
|
FactSet Research Systems Inc. |
5,414 | 1,659,391 | ||||||
|
Franklin Resources Inc. |
42,636 | 799,425 | ||||||
|
Intercontinental Exchange Inc. |
78,024 | 7,365,466 | ||||||
|
Invesco Ltd. |
55,697 | 730,188 | ||||||
|
Moody’s Corp. |
24,050 | 6,322,745 | ||||||
|
Northern Trust Corp. |
28,170 | 2,204,866 | ||||||
|
S&P Global Inc. |
34,423 | 11,109,335 | ||||||
|
State Street Corp. |
50,191 | 2,956,250 | ||||||
|
T Rowe Price Group Inc. |
32,528 | 4,119,996 | ||||||
|
|
|
|||||||
| 73,717,091 | ||||||||
| Chemicals — 2.2% | ||||||||
|
Air Products & Chemicals Inc. |
31,552 | 8,715,924 | ||||||
|
Albemarle Corp. |
15,194 | 1,416,233 | ||||||
|
Axalta Coating Systems Ltd.(a) |
30,273 | 760,155 | ||||||
|
Ecolab Inc. |
36,353 | 6,674,047 | ||||||
|
HB Fuller Co. |
7,487 | 338,787 | ||||||
|
International Flavors & Fragrances Inc. |
12,230 | 1,255,532 | ||||||
|
Linde PLC |
74,999 | 16,525,280 | ||||||
|
Minerals Technologies Inc. |
4,868 | 266,231 | ||||||
|
Mosaic Co. (The) |
51,031 | 944,073 | ||||||
|
PPG Industries Inc. |
33,719 | 4,374,029 | ||||||
|
Sherwin-Williams Co. (The) |
11,682 | 8,036,982 | ||||||
|
|
|
|||||||
| 49,307,273 | ||||||||
| Commercial Services & Supplies — 0.2% | ||||||||
|
ACCO Brands Corp. |
11,937 | 62,908 | ||||||
|
Copart Inc.(a) |
30,110 | 3,322,940 | ||||||
|
Deluxe Corp. |
6,371 | 136,594 | ||||||
|
HNI Corp. |
6,310 | 205,390 | ||||||
|
Interface Inc. |
8,941 | 54,808 | ||||||
|
Knoll Inc. |
7,521 | 86,191 | ||||||
|
Steelcase Inc., Class A |
11,213 | 117,064 | ||||||
|
Tetra Tech Inc. |
7,726 | 779,631 | ||||||
|
|
|
|||||||
| 4,765,526 | ||||||||
| Communications Equipment — 1.2% | ||||||||
|
Cisco Systems Inc. |
602,964 | 21,646,408 | ||||||
|
CommScope Holding Co. Inc.(a)(c) |
28,484 | 253,508 | ||||||
|
F5 Networks Inc.(a) |
8,678 | 1,153,653 | ||||||
|
Motorola Solutions Inc. |
24,251 | 3,833,113 | ||||||
|
Plantronics Inc. |
4,995 | 97,502 | ||||||
|
|
|
|||||||
| 26,984,184 | ||||||||
| Construction & Engineering — 0.1% | ||||||||
|
EMCOR Group Inc. |
7,672 | 523,154 | ||||||
|
Granite Construction Inc. |
6,894 | 133,123 | ||||||
| 32 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Construction & Engineering (continued) | ||||||||
|
Quanta Services Inc. |
19,682 | $ | 1,228,747 | |||||
|
|
|
|||||||
| 1,885,024 | ||||||||
| Consumer Finance — 0.5% | ||||||||
|
Ally Financial Inc. |
53,661 | 1,431,675 | ||||||
|
American Express Co. |
97,799 | 8,923,181 | ||||||
|
|
|
|||||||
| 10,354,856 | ||||||||
| Containers & Packaging — 0.4% | ||||||||
|
Amcor PLC |
225,120 | 2,348,002 | ||||||
|
Avery Dennison Corp. |
11,923 | 1,650,024 | ||||||
|
Ball Corp. |
46,615 | 4,148,735 | ||||||
|
Sealed Air Corp. |
22,153 | 877,037 | ||||||
|
Sonoco Products Co. |
14,423 | 705,140 | ||||||
|
|
|
|||||||
| 9,728,938 | ||||||||
| Distributors — 0.2% | ||||||||
|
LKQ Corp.(a) |
40,991 | 1,311,302 | ||||||
|
Pool Corp. |
5,723 | 2,002,077 | ||||||
|
|
|
|||||||
| 3,313,379 | ||||||||
| Diversified Financial Services — 0.1% | ||||||||
|
Equitable Holdings Inc. |
57,982 | 1,246,033 | ||||||
|
Voya Financial Inc. |
18,031 | 864,226 | ||||||
|
|
|
|||||||
| 2,110,259 | ||||||||
| Diversified Telecommunication Services — 1.7% | ||||||||
|
CenturyLink Inc. |
132,614 | 1,143,133 | ||||||
|
Liberty Global PLC, Class A(a) |
23,231 | 440,924 | ||||||
|
Liberty Global PLC, Class C, NVS(a) |
55,904 | 1,043,169 | ||||||
|
Verizon Communications Inc. |
590,926 | 33,676,873 | ||||||
|
|
|
|||||||
| 36,304,099 | ||||||||
| Electric Utilities — 0.6% | ||||||||
|
Alliant Energy Corp. |
35,629 | 1,969,571 | ||||||
|
Eversource Energy |
48,110 | 4,198,560 | ||||||
|
FirstEnergy Corp. |
77,556 | 2,304,964 | ||||||
|
OGE Energy Corp. |
28,612 | 880,391 | ||||||
|
PPL Corp. |
109,869 | 3,021,398 | ||||||
|
|
|
|||||||
| 12,374,884 | ||||||||
| Electrical Equipment — 0.5% | ||||||||
|
Acuity Brands Inc. |
5,748 | 512,377 | ||||||
|
Eaton Corp. PLC |
57,178 | 5,934,505 | ||||||
|
Rockwell Automation Inc. |
16,516 | 3,916,274 | ||||||
|
Sensata Technologies Holding PLC(a) |
22,581 | 987,015 | ||||||
|
|
|
|||||||
| 11,350,171 | ||||||||
| Electronic Equipment, Instruments & Components — 0.8% | ||||||||
|
Cognex Corp. |
24,662 | 1,625,226 | ||||||
|
Corning Inc. |
108,499 | 3,468,713 | ||||||
|
Flex Ltd.(a) |
71,683 | 1,014,314 | ||||||
|
Itron Inc.(a) |
5,547 | 376,919 | ||||||
|
Keysight Technologies Inc.(a) |
26,600 | 2,789,542 | ||||||
|
TE Connectivity Ltd. |
47,154 | 4,568,279 | ||||||
|
Trimble Inc.(a) |
35,644 | 1,715,546 | ||||||
|
Zebra Technologies Corp., Class A(a) |
7,598 | 2,155,097 | ||||||
|
|
|
|||||||
| 17,713,636 | ||||||||
| Energy Equipment & Services — 0.2% | ||||||||
|
Baker Hughes Co. |
93,523 | 1,381,335 | ||||||
|
Core Laboratories NV |
6,553 | 94,691 | ||||||
|
National Oilwell Varco Inc. |
54,284 | 455,985 | ||||||
|
Schlumberger Ltd. |
197,381 | 2,948,872 | ||||||
|
TechnipFMC PLC |
61,507 | 340,134 | ||||||
|
|
|
|||||||
| 5,221,017 | ||||||||
| Security | Shares | Value | ||||||
| Entertainment — 1.7% | ||||||||
|
Electronic Arts Inc.(a) |
41,164 | $ | 4,932,682 | |||||
|
Walt Disney Co. (The) |
257,945 | 31,275,831 | ||||||
|
|
|
|||||||
| 36,208,513 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 3.0% | ||||||||
|
American Tower Corp. |
63,311 | 14,539,371 | ||||||
|
AvalonBay Communities Inc. |
20,006 | 2,783,435 | ||||||
|
Boston Properties Inc. |
21,048 | 1,524,086 | ||||||
|
Corporate Office Properties Trust |
15,578 | 349,414 | ||||||
|
Digital Realty Trust Inc. |
38,359 | 5,535,204 | ||||||
|
Duke Realty Corp. |
52,715 | 2,002,643 | ||||||
|
Equinix Inc. |
12,652 | 9,251,648 | ||||||
|
Equity Residential |
52,898 | 2,485,148 | ||||||
|
Federal Realty Investment Trust |
10,279 | 706,990 | ||||||
|
Healthpeak Properties Inc. |
76,967 | 2,075,800 | ||||||
|
Host Hotels & Resorts Inc. |
101,011 | 1,058,595 | ||||||
|
Iron Mountain Inc. |
41,046 | 1,069,659 | ||||||
|
Macerich Co. (The)(c) |
14,634 | 101,853 | ||||||
|
PotlatchDeltic Corp. |
9,499 | 394,683 | ||||||
|
Prologis Inc. |
105,535 | 10,469,072 | ||||||
|
SBA Communications Corp. |
15,913 | 4,620,658 | ||||||
|
Simon Property Group Inc. |
43,598 | 2,738,390 | ||||||
|
UDR Inc. |
42,166 | 1,317,266 | ||||||
|
Vornado Realty Trust |
23,230 | 713,858 | ||||||
|
Weyerhaeuser Co. |
106,680 | 2,911,297 | ||||||
|
|
|
|||||||
| 66,649,070 | ||||||||
| Food & Staples Retailing — 0.3% | ||||||||
|
Kroger Co. (The) |
112,403 | 3,620,501 | ||||||
|
Sysco Corp. |
68,756 | 3,802,894 | ||||||
|
United Natural Foods Inc.(a) |
8,067 | 117,536 | ||||||
|
|
|
|||||||
| 7,540,931 | ||||||||
| Food Products — 1.7% | ||||||||
|
Archer-Daniels-Midland Co. |
79,207 | 3,662,532 | ||||||
|
Bunge Ltd. |
20,452 | 1,160,242 | ||||||
|
Campbell Soup Co. |
25,910 | 1,209,220 | ||||||
|
Darling Ingredients Inc.(a) |
22,909 | 985,087 | ||||||
|
General Mills Inc. |
86,585 | 5,118,905 | ||||||
|
Hain Celestial Group Inc. (The)(a) |
11,951 | 367,493 | ||||||
|
Hormel Foods Corp. |
42,096 | 2,049,654 | ||||||
|
Ingredion Inc. |
9,642 | 683,521 | ||||||
|
JM Smucker Co. (The) |
16,312 | 1,830,206 | ||||||
|
Kellogg Co. |
36,703 | 2,308,252 | ||||||
|
Kraft Heinz Co. (The) |
96,123 | 2,940,403 | ||||||
|
Lamb Weston Holdings Inc. |
20,896 | 1,325,851 | ||||||
|
McCormick & Co. Inc./MD, NVS |
17,677 | 3,190,875 | ||||||
|
Mondelez International Inc., Class A |
203,946 | 10,833,612 | ||||||
|
|
|
|||||||
| 37,665,853 | ||||||||
| Gas Utilities — 0.1% | ||||||||
|
Atmos Energy Corp. |
17,503 | 1,604,500 | ||||||
|
New Jersey Resources Corp. |
13,679 | 399,153 | ||||||
|
Northwest Natural Holding Co. |
4,283 | 190,337 | ||||||
|
UGI Corp. |
29,757 | 962,341 | ||||||
|
|
|
|||||||
| 3,156,331 | ||||||||
| Health Care Equipment & Supplies — 1.9% | ||||||||
|
ABIOMED Inc.(a) |
6,441 | 1,622,359 | ||||||
|
Align Technology Inc.(a) |
10,688 | 4,553,943 | ||||||
|
Becton Dickinson and Co. |
41,409 | 9,570,862 | ||||||
|
Cooper Companies Inc. (The) |
7,631 | 2,434,671 | ||||||
|
DENTSPLY SIRONA Inc. |
31,242 | 1,474,310 | ||||||
|
Edwards Lifesciences Corp.(a) |
88,330 | 6,332,378 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
33 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Health Care Equipment & Supplies (continued) | ||||||||
|
Hologic Inc.(a) |
36,920 | $ | 2,540,834 | |||||
|
IDEXX Laboratories Inc.(a) |
12,104 | 5,142,021 | ||||||
|
ResMed Inc. |
20,695 | 3,972,198 | ||||||
|
Varian Medical Systems Inc.(a) |
12,977 | 2,242,426 | ||||||
|
West Pharmaceutical Services Inc. |
10,489 | 2,853,742 | ||||||
|
|
|
|||||||
| 42,739,744 | ||||||||
| Health Care Providers & Services — 1.7% | ||||||||
|
AmerisourceBergen Corp. |
21,812 | 2,095,479 | ||||||
|
Cardinal Health Inc. |
41,763 | 1,912,328 | ||||||
|
Centene Corp.(a) |
82,765 | 4,891,411 | ||||||
|
Cigna Corp. |
52,737 | 8,805,497 | ||||||
|
DaVita Inc.(a) |
11,385 | 981,956 | ||||||
|
HCA Healthcare Inc. |
38,506 | 4,772,434 | ||||||
|
Henry Schein Inc.(a) |
20,512 | 1,304,153 | ||||||
|
Humana Inc. |
18,851 | 7,526,827 | ||||||
|
Laboratory Corp. of America Holdings(a) |
13,921 | 2,780,998 | ||||||
|
MEDNAX Inc.(a) |
12,312 | 156,978 | ||||||
|
Patterson Companies Inc. |
12,676 | 315,316 | ||||||
|
Quest Diagnostics Inc. |
19,091 | 2,331,775 | ||||||
|
Select Medical Holdings Corp.(a) |
15,143 | 317,700 | ||||||
|
|
|
|||||||
| 38,192,852 | ||||||||
| Health Care Technology — 0.3% | ||||||||
|
Cerner Corp. |
43,522 | 3,050,457 | ||||||
|
Teladoc Health Inc.(a)(c) |
16,303 | 3,202,887 | ||||||
|
|
|
|||||||
| 6,253,344 | ||||||||
| Hotels, Restaurants & Leisure — 2.4% | ||||||||
|
Aramark |
32,482 | 901,051 | ||||||
|
Choice Hotels International Inc. |
5,045 | 440,681 | ||||||
|
Darden Restaurants Inc. |
18,402 | 1,691,512 | ||||||
|
Domino’s Pizza Inc. |
5,597 | 2,117,457 | ||||||
|
Hilton Worldwide Holdings Inc. |
39,439 | 3,463,138 | ||||||
|
Jack in the Box Inc. |
3,114 | 249,307 | ||||||
|
Marriott International Inc./MD, Class A |
39,441 | 3,663,280 | ||||||
|
McDonald’s Corp. |
106,184 | 22,617,192 | ||||||
|
Royal Caribbean Cruises Ltd. |
25,416 | 1,433,971 | ||||||
|
Starbucks Corp. |
166,810 | 14,505,797 | ||||||
|
Vail Resorts Inc. |
5,752 | 1,334,694 | ||||||
|
|
|
|||||||
| 52,418,080 | ||||||||
| Household Durables — 0.3% | ||||||||
|
Ethan Allen Interiors Inc. |
3,480 | 55,854 | ||||||
|
Garmin Ltd. |
20,462 | 2,128,457 | ||||||
|
La-Z-Boy Inc. |
6,331 | 216,710 | ||||||
|
Meritage Homes Corp.(a) |
5,295 | 461,141 | ||||||
|
Mohawk Industries Inc.(a) |
8,699 | 897,650 | ||||||
|
Newell Brands Inc. |
57,235 | 1,010,770 | ||||||
|
Whirlpool Corp. |
8,861 | 1,638,931 | ||||||
|
|
|
|||||||
| 6,409,513 | ||||||||
| Household Products — 3.1% | ||||||||
|
Clorox Co. (The) |
18,012 | 3,732,987 | ||||||
|
Colgate-Palmolive Co. |
116,227 | 9,169,148 | ||||||
|
Kimberly-Clark Corp. |
48,541 | 6,436,051 | ||||||
|
Procter & Gamble Co. (The) |
353,533 | 48,469,375 | ||||||
|
|
|
|||||||
| 67,807,561 | ||||||||
| Independent Power and Renewable Electricity Producers — 0.1% | ||||||||
|
AES Corp. (The) |
95,004 | 1,852,578 | ||||||
|
Ormat Technologies Inc. |
5,640 | 399,707 | ||||||
|
|
|
|||||||
| 2,252,285 | ||||||||
| Security | Shares | Value | ||||||
| Industrial Conglomerates — 0.9% | ||||||||
|
3M Co. |
82,153 | $ | 13,141,194 | |||||
|
Roper Technologies Inc. |
14,925 | 5,542,249 | ||||||
|
|
|
|||||||
| 18,683,443 | ||||||||
| Insurance — 2.2% | ||||||||
|
Allstate Corp. (The) |
44,919 | 3,986,561 | ||||||
|
Arthur J Gallagher & Co. |
27,156 | 2,816,349 | ||||||
|
Chubb Ltd. |
64,361 | 8,361,138 | ||||||
|
Hartford Financial Services Group Inc. (The) |
51,274 | 1,975,074 | ||||||
|
Lincoln National Corp. |
27,249 | 956,440 | ||||||
|
Loews Corp. |
36,217 | 1,256,006 | ||||||
|
Marsh & McLennan Companies Inc. |
72,757 | 7,527,439 | ||||||
|
Principal Financial Group Inc. |
39,315 | 1,541,934 | ||||||
|
Progressive Corp. (The) |
83,455 | 7,669,515 | ||||||
|
Prudential Financial Inc. |
56,322 | 3,605,734 | ||||||
|
Travelers Companies Inc. (The) |
36,155 | 4,364,270 | ||||||
|
Willis Towers Watson PLC |
18,427 | 3,362,559 | ||||||
|
|
|
|||||||
| 47,423,019 | ||||||||
| Interactive Media & Services — 10.5% | ||||||||
|
Alphabet Inc., Class A(a) |
42,850 | 69,250,314 | ||||||
|
Alphabet Inc., Class C, NVS(a) |
43,206 | 70,037,358 | ||||||
|
Facebook Inc., Class A(a) |
343,383 | 90,347,501 | ||||||
|
|
|
|||||||
| 229,635,173 | ||||||||
| Internet & Direct Marketing Retail — 0.4% | ||||||||
|
Booking Holdings Inc.(a) |
5,842 | 9,478,645 | ||||||
|
|
|
|||||||
| IT Services — 7.5% | ||||||||
|
Accenture PLC, Class A |
90,969 | 19,732,086 | ||||||
|
Automatic Data Processing Inc. |
61,419 | 9,701,745 | ||||||
|
Cognizant Technology Solutions Corp., Class A |
77,278 | 5,519,195 | ||||||
|
International Business Machines Corp. |
126,811 | 14,159,716 | ||||||
|
Mastercard Inc., Class A |
127,631 | 36,839,412 | ||||||
|
Okta Inc.(a) |
16,602 | 3,483,598 | ||||||
|
PayPal Holdings Inc.(a) |
159,294 | 29,649,392 | ||||||
|
Visa Inc., Class A |
240,926 | 43,778,663 | ||||||
|
Western Union Co. (The) |
59,118 | 1,149,254 | ||||||
|
|
|
|||||||
| 164,013,061 | ||||||||
| Leisure Products — 0.1% | ||||||||
|
Callaway Golf Co. |
12,968 | 200,874 | ||||||
|
Hasbro Inc. |
18,607 | 1,539,171 | ||||||
|
Mattel Inc.(a) |
49,087 | 675,928 | ||||||
|
|
|
|||||||
| 2,415,973 | ||||||||
| Life Sciences Tools & Services — 0.7% | ||||||||
|
Agilent Technologies Inc. |
44,146 | 4,506,865 | ||||||
|
Bio-Techne Corp. |
5,498 | 1,387,750 | ||||||
|
IQVIA Holdings Inc.(a) |
27,311 | 4,205,621 | ||||||
|
Mettler-Toledo International Inc.(a) |
3,414 | 3,406,865 | ||||||
|
Waters Corp.(a) |
8,876 | 1,977,750 | ||||||
|
|
|
|||||||
| 15,484,851 | ||||||||
| Machinery — 2.8% | ||||||||
|
AGCO Corp. |
8,942 | 688,802 | ||||||
|
Caterpillar Inc. |
77,317 | 12,142,635 | ||||||
|
Cummins Inc. |
21,092 | 4,637,920 | ||||||
|
Deere & Co. |
42,474 | 9,595,301 | ||||||
|
Dover Corp. |
20,450 | 2,264,019 | ||||||
|
Flowserve Corp. |
18,146 | 528,412 | ||||||
|
Fortive Corp. |
43,274 | 2,665,678 | ||||||
|
Graco Inc. |
23,897 | 1,479,224 | ||||||
|
Illinois Tool Works Inc. |
45,162 | 8,846,333 | ||||||
|
Lincoln Electric Holdings Inc. |
8,141 | 828,917 | ||||||
| 34 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Machinery (continued) | ||||||||
|
Meritor Inc.(a) |
10,098 | $ | 245,785 | |||||
|
Middleby Corp. (The)(a) |
7,975 | 793,832 | ||||||
|
PACCAR Inc. |
49,263 | 4,206,075 | ||||||
|
Parker-Hannifin Corp. |
18,252 | 3,802,987 | ||||||
|
Snap-on Inc. |
7,428 | 1,170,133 | ||||||
|
Stanley Black & Decker Inc. |
22,050 | 3,664,710 | ||||||
|
Tennant Co. |
2,529 | 150,779 | ||||||
|
Timken Co. (The) |
9,446 | 563,926 | ||||||
|
Westinghouse Air Brake Technologies Corp. |
25,711 | 1,524,662 | ||||||
|
Xylem Inc./NY |
25,780 | 2,246,469 | ||||||
|
|
|
|||||||
| 62,046,599 | ||||||||
| Media — 0.2% | ||||||||
|
Discovery Inc., Class A(a)(c) |
22,327 | 451,899 | ||||||
|
Discovery Inc., Class C, NVS(a) |
46,200 | 846,384 | ||||||
|
John Wiley & Sons Inc., Class A |
6,357 | 196,813 | ||||||
|
New York Times Co. (The), Class A(c) |
20,096 | 797,007 | ||||||
|
Omnicom Group Inc. |
30,557 | 1,442,290 | ||||||
|
Scholastic Corp., NVS |
4,345 | 85,857 | ||||||
|
|
|
|||||||
| 3,820,250 | ||||||||
| Metals & Mining — 0.4% | ||||||||
|
Compass Minerals International Inc. |
4,997 | 301,719 | ||||||
|
Newmont Corp. |
114,407 | 7,189,336 | ||||||
|
Nucor Corp. |
43,196 | 2,063,041 | ||||||
|
Schnitzer Steel Industries Inc., Class A |
3,645 | 76,545 | ||||||
|
|
|
|||||||
| 9,630,641 | ||||||||
| Multi-Utilities — 0.9% | ||||||||
|
Avista Corp. |
9,735 | 323,397 | ||||||
|
CenterPoint Energy Inc. |
71,865 | 1,518,507 | ||||||
|
CMS Energy Corp. |
40,954 | 2,593,617 | ||||||
|
Consolidated Edison Inc. |
47,801 | 3,751,901 | ||||||
|
MDU Resources Group Inc. |
28,229 | 670,721 | ||||||
|
NiSource Inc. |
54,610 | 1,254,392 | ||||||
|
Sempra Energy |
41,809 | 5,241,176 | ||||||
|
WEC Energy Group Inc. |
44,928 | 4,517,510 | ||||||
|
|
|
|||||||
| 19,871,221 | ||||||||
| Multiline Retail — 0.0% | ||||||||
|
Kohl’s Corp.(c) |
22,213 | 472,915 | ||||||
|
Nordstrom Inc.(c) |
16,060 | 194,326 | ||||||
|
|
|
|||||||
| 667,241 | ||||||||
| Oil, Gas & Consumable Fuels — 1.0% | ||||||||
|
Apache Corp. |
53,373 | 442,996 | ||||||
|
Cheniere Energy Inc.(a) |
32,285 | 1,545,483 | ||||||
|
ConocoPhillips |
152,698 | 4,370,217 | ||||||
|
Devon Energy Corp. |
54,490 | 486,596 | ||||||
|
EQT Corp. |
36,331 | 550,051 | ||||||
|
Hess Corp. |
39,316 | 1,463,341 | ||||||
|
Marathon Oil Corp. |
113,099 | 447,872 | ||||||
|
Marathon Petroleum Corp. |
92,902 | 2,740,609 | ||||||
|
Occidental Petroleum Corp. |
127,828 | 1,167,070 | ||||||
|
ONEOK Inc. |
62,656 | 1,817,024 | ||||||
|
Phillips 66 |
62,227 | 2,903,512 | ||||||
|
Pioneer Natural Resources Co. |
23,476 | 1,867,750 | ||||||
|
Southwestern Energy Co.(a) |
81,423 | 217,399 | ||||||
|
Valero Energy Corp. |
58,234 | 2,248,415 | ||||||
|
|
|
|||||||
| 22,268,335 | ||||||||
| Paper & Forest Products — 0.0% | ||||||||
|
Domtar Corp. |
7,588 | 181,201 | ||||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
| Personal Products — 0.3% | ||||||||
|
Estee Lauder Companies Inc. (The), Class A |
32,128 | $ | 7,057,237 | |||||
|
|
|
|||||||
| Pharmaceuticals — 2.6% | ||||||||
|
Bristol-Myers Squibb Co. |
323,124 | 18,886,598 | ||||||
|
Jazz Pharmaceuticals PLC(a)(c) |
7,870 | 1,134,067 | ||||||
|
Merck & Co. Inc. |
360,453 | 27,109,670 | ||||||
|
Zoetis Inc. |
67,855 | 10,758,410 | ||||||
|
|
|
|||||||
| 57,888,745 | ||||||||
| Professional Services — 0.4% | ||||||||
|
ASGN Inc.(a) |
7,462 | 497,566 | ||||||
|
Exponent Inc. |
7,501 | 521,995 | ||||||
|
Heidrick & Struggles International Inc. |
2,437 | 55,685 | ||||||
|
ICF International Inc. |
2,610 | 170,668 | ||||||
|
IHS Markit Ltd. |
54,044 | 4,370,538 | ||||||
|
Kelly Services Inc., Class A, NVS |
4,701 | 81,703 | ||||||
|
ManpowerGroup Inc. |
8,350 | 566,715 | ||||||
|
Resources Connection Inc. |
4,855 | 52,143 | ||||||
|
Robert Half International Inc. |
16,478 | 835,270 | ||||||
|
TransUnion |
27,009 | 2,151,537 | ||||||
|
TrueBlue Inc.(a) |
4,781 | 74,201 | ||||||
|
|
|
|||||||
| 9,378,021 | ||||||||
| Real Estate Management & Development — 0.2% | ||||||||
|
CBRE Group Inc., Class A(a) |
47,900 | 2,414,160 | ||||||
|
Jones Lang LaSalle Inc. |
7,305 | 824,442 | ||||||
|
Realogy Holdings Corp.(a) |
17,512 | 195,434 | ||||||
|
|
|
|||||||
| 3,434,036 | ||||||||
| Road & Rail — 1.7% | ||||||||
|
AMERCO |
1,403 | 487,066 | ||||||
|
ArcBest Corp. |
3,832 | 116,953 | ||||||
|
Avis Budget Group Inc.(a) |
8,212 | 276,498 | ||||||
|
CSX Corp. |
109,145 | 8,615,906 | ||||||
|
Kansas City Southern |
13,592 | 2,394,095 | ||||||
|
Norfolk Southern Corp. |
36,528 | 7,638,735 | ||||||
|
Ryder System Inc. |
7,841 | 386,248 | ||||||
|
Union Pacific Corp. |
96,902 | 17,170,065 | ||||||
|
|
|
|||||||
| 37,085,566 | ||||||||
| Semiconductors & Semiconductor Equipment — 5.9% | ||||||||
|
Advanced Micro Devices Inc.(a) |
167,277 | 12,594,285 | ||||||
|
Analog Devices Inc. |
52,513 | 6,224,366 | ||||||
|
Applied Materials Inc. |
130,676 | 7,739,939 | ||||||
|
Intel Corp. |
604,636 | 26,773,282 | ||||||
|
Lam Research Corp. |
20,701 | 7,081,398 | ||||||
|
Microchip Technology Inc. |
35,083 | 3,686,522 | ||||||
|
NVIDIA Corp. |
87,826 | 44,032,443 | ||||||
|
Skyworks Solutions Inc. |
23,858 | 3,370,897 | ||||||
|
Texas Instruments Inc. |
131,062 | 18,950,255 | ||||||
|
|
|
|||||||
| 130,453,387 | ||||||||
| Software — 15.8% | ||||||||
|
Adobe Inc.(a) |
68,802 | 30,761,374 | ||||||
|
ANSYS Inc.(a) |
12,248 | 3,727,924 | ||||||
|
Autodesk Inc.(a) |
31,336 | 7,380,881 | ||||||
|
Cadence Design Systems Inc.(a) |
39,807 | 4,353,692 | ||||||
|
Citrix Systems Inc. |
16,819 | 1,905,088 | ||||||
|
Fortinet Inc.(a) |
19,649 | 2,168,660 | ||||||
|
Intuit Inc. |
37,240 | 11,718,683 | ||||||
|
Microsoft Corp. |
1,028,805 | 208,302,148 | ||||||
|
NortonLifeLock Inc. |
79,771 | 1,640,889 | ||||||
|
Oracle Corp. |
292,726 | 16,424,856 | ||||||
|
Paycom Software Inc.(a) |
7,132 | 2,596,690 | ||||||
| S C H E D U L E O F I N V E S T M E N T S | 35 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Software (continued) | ||||||||
|
salesforce.com Inc.(a) |
128,440 | $ | 29,832,759 | |||||
|
ServiceNow Inc.(a) |
27,232 | 13,549,826 | ||||||
|
Slack Technologies Inc., Class A(a)(c) |
54,759 | 1,400,735 | ||||||
|
Splunk Inc.(a) |
22,718 | 4,499,073 | ||||||
|
Teradata Corp.(a)(c) |
15,780 | 289,879 | ||||||
|
VMware Inc., Class A(a) |
11,985 | 1,542,829 | ||||||
|
Workday Inc., Class A(a) |
24,871 | 5,225,895 | ||||||
|
|
|
|||||||
| 347,321,881 | ||||||||
| Specialty Retail — 3.3% | ||||||||
|
AutoNation Inc.(a) |
7,990 | 453,273 | ||||||
|
Best Buy Co. Inc. |
33,121 | 3,694,648 | ||||||
|
Buckle Inc. (The) |
4,495 | 107,700 | ||||||
|
CarMax Inc.(a) |
23,161 | 2,002,037 | ||||||
|
Foot Locker Inc. |
14,858 | 547,963 | ||||||
|
GameStop Corp., Class A(a)(c) |
8,488 | 88,869 | ||||||
|
Gap Inc. (The) |
32,478 | 631,697 | ||||||
|
Home Depot Inc. (The) |
153,589 | 40,963,722 | ||||||
|
Lowe’s Companies Inc. |
107,817 | 17,045,868 | ||||||
|
ODP Corp. (The) |
7,401 | 144,320 | ||||||
|
Signet Jewelers Ltd. |
7,604 | 169,417 | ||||||
|
Tiffany & Co. |
15,495 | 2,027,366 | ||||||
|
Tractor Supply Co. |
16,533 | 2,202,361 | ||||||
|
Ulta Beauty Inc.(a) |
7,633 | 1,578,275 | ||||||
|
|
|
|||||||
| 71,657,516 | ||||||||
| Technology Hardware, Storage & Peripherals — 0.4% | ||||||||
|
Dell Technologies Inc., Class C(a) |
34,240 | 2,063,303 | ||||||
|
Hewlett Packard Enterprise Co. |
182,670 | 1,578,269 | ||||||
|
HP Inc. |
203,821 | 3,660,625 | ||||||
|
Xerox Holdings Corp. |
25,898 | 450,107 | ||||||
|
|
|
|||||||
| 7,752,304 | ||||||||
| Textiles, Apparel & Luxury Goods — 1.3% | ||||||||
|
Capri Holdings Ltd.(a) |
20,313 | 431,042 | ||||||
|
Columbia Sportswear Co. |
4,251 | 317,082 | ||||||
|
Deckers Outdoor Corp.(a) |
3,983 | 1,009,173 | ||||||
|
Hanesbrands Inc. |
49,756 | 799,579 | ||||||
|
Nike Inc., Class B |
177,080 | 21,263,766 | ||||||
|
PVH Corp. |
10,148 | 591,527 | ||||||
|
Under Armour Inc., Class A(a) |
27,794 | 384,669 | ||||||
|
Under Armour Inc., Class C, NVS(a) |
28,498 | 348,530 | ||||||
|
VF Corp. |
47,254 | 3,175,469 | ||||||
|
Wolverine World Wide Inc. |
11,833 | 315,586 | ||||||
|
|
|
|||||||
| 28,636,423 | ||||||||
| Security | Shares | Value | ||||||
| Thrifts & Mortgage Finance — 0.0% | ||||||||
|
New York Community Bancorp. Inc. |
66,413 | $ | 551,892 | |||||
|
|
|
|||||||
| Trading Companies & Distributors — 0.4% | ||||||||
|
Air Lease Corp. |
15,622 | 425,543 | ||||||
|
Applied Industrial Technologies Inc. |
5,366 | 327,595 | ||||||
|
Fastenal Co. |
81,642 | 3,529,384 | ||||||
|
H&E Equipment Services Inc. |
4,676 | 98,383 | ||||||
|
HD Supply Holdings Inc.(a) |
23,207 | 925,031 | ||||||
|
United Rentals Inc.(a) |
10,297 | 1,835,852 | ||||||
|
WW Grainger Inc. |
6,460 | 2,261,129 | ||||||
|
|
|
|||||||
| 9,402,917 | ||||||||
| Water Utilities — 0.2% | ||||||||
|
American Water Works Co. Inc. |
25,901 | 3,898,360 | ||||||
|
Essential Utilities Inc. |
33,291 | 1,371,589 | ||||||
|
|
|
|||||||
| 5,269,949 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
2,193,219,976 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.5% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(b)(d)(e) |
4,421,967 | 4,425,062 | ||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(d) |
6,170,000 | 6,170,000 | ||||||
|
|
|
|||||||
| 10,595,062 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.5%
|
|
10,595,062 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.3%
|
|
2,203,815,038 | ||||||
|
Other Assets, Less Liabilities — (0.3)% |
|
(6,633,613 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 2,197,181,425 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
All or a portion of this security is on loan. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
| 36 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 17,130,304 | $ | — | $ | (12,700,632 | )(a) | $ | 18,616 | $ (23,226) | $ | 4,425,062 | 4,421,967 | $ | 50,524 | (b) | $ | — | ||||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
2,660,000 | 3,510,000 | (a) | — | — | — | 6,170,000 | 6,170,000 | 2,373 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
7,853,412 | 3,650,258 | (414,547 | ) | 68,599 | 1,869,103 | 13,026,825 | 21,740 | 149,153 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 87,215 | $ | 1,845,877 | $ | 23,621,887 | $ | 202,050 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
22 | 12/18/20 | $ | 3,591 | $ | (170,329 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 170,329 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 1,034,419 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (541,842 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 5,101,900 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
|
S C H E D U L E O F I N V E S T M E N T S |
37 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI KLD 400 Social ETF |
Fair Value Measurements (continued)
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 2,193,219,976 | $ | — | $ | — | $ | 2,193,219,976 | ||||||||
|
Money Market Funds |
10,595,062 | — | — | 10,595,062 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 2,203,815,038 | $ | — | $ | — | $ | 2,203,815,038 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (170,329 | ) | $ | — | $ | — | $ | (170,329 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 38 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® MSCI USA ESG Select ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Air Freight & Logistics — 1.9% | ||||||||
|
CH Robinson Worldwide Inc. |
34,076 | $ | 3,013,341 | |||||
|
Expeditors International of Washington Inc. |
360,169 | 31,828,134 | ||||||
|
|
|
|||||||
| 34,841,475 | ||||||||
| Auto Components — 0.4% | ||||||||
|
Aptiv PLC |
84,270 | 8,131,212 | ||||||
|
|
|
|||||||
| Automobiles — 1.3% | ||||||||
|
Tesla Inc.(a) |
59,153 | 22,953,730 | ||||||
|
|
|
|||||||
| Banks — 0.6% | ||||||||
|
KeyCorp. |
168,480 | 2,186,871 | ||||||
|
PNC Financial Services Group Inc. (The) |
41,958 | 4,694,261 | ||||||
|
SVB Financial Group(a) |
14,826 | 4,309,918 | ||||||
|
|
|
|||||||
| 11,191,050 | ||||||||
| Beverages — 2.3% | ||||||||
|
Coca-Cola Co. (The) |
313,848 | 15,083,535 | ||||||
|
PepsiCo Inc. |
198,334 | 26,435,939 | ||||||
|
|
|
|||||||
| 41,519,474 | ||||||||
| Biotechnology — 2.9% | ||||||||
|
AbbVie Inc. |
105,916 | 9,013,452 | ||||||
|
Amgen Inc. |
70,631 | 15,322,689 | ||||||
|
Biogen Inc.(a) |
15,706 | 3,959,011 | ||||||
|
Gilead Sciences Inc. |
194,104 | 11,287,148 | ||||||
|
Vertex Pharmaceuticals Inc.(a) |
57,837 | 12,050,917 | ||||||
|
|
|
|||||||
| 51,633,217 | ||||||||
| Building Products — 2.4% | ||||||||
|
Johnson Controls International PLC |
662,885 | 27,980,376 | ||||||
|
Owens Corning |
50,994 | 3,338,577 | ||||||
|
Trane Technologies PLC |
91,165 | 12,102,154 | ||||||
|
|
|
|||||||
| 43,421,107 | ||||||||
| Capital Markets — 4.6% | ||||||||
|
Bank of New York Mellon Corp. (The) |
261,254 | 8,976,687 | ||||||
|
BlackRock Inc.(b) |
60,286 | 36,123,974 | ||||||
|
FactSet Research Systems Inc. |
6,696 | 2,052,324 | ||||||
|
Franklin Resources Inc. |
129,721 | 2,432,269 | ||||||
|
Invesco Ltd. |
215,553 | 2,825,900 | ||||||
|
Moody’s Corp. |
9,659 | 2,539,351 | ||||||
|
Northern Trust Corp. |
197,068 | 15,424,512 | ||||||
|
S&P Global Inc. |
8,202 | 2,647,032 | ||||||
|
State Street Corp. |
111,792 | 6,584,549 | ||||||
|
T Rowe Price Group Inc. |
33,143 | 4,197,892 | ||||||
|
|
|
|||||||
| 83,804,490 | ||||||||
| Chemicals — 2.4% | ||||||||
|
Axalta Coating Systems Ltd.(a) |
152,937 | 3,840,248 | ||||||
|
Ecolab Inc. |
143,926 | 26,423,374 | ||||||
|
International Flavors & Fragrances Inc.(c) |
52,817 | 5,422,193 | ||||||
|
Linde PLC |
16,660 | 3,670,865 | ||||||
|
Mosaic Co. (The) |
148,178 | 2,741,293 | ||||||
|
PPG Industries Inc. |
15,436 | 2,002,358 | ||||||
|
|
|
|||||||
| 44,100,331 | ||||||||
| Communications Equipment — 1.0% | ||||||||
|
Cisco Systems Inc. |
494,851 | 17,765,151 | ||||||
|
|
|
|||||||
| Consumer Finance — 1.3% | ||||||||
|
Ally Financial Inc. |
233,320 | 6,224,977 | ||||||
|
American Express Co. |
186,503 | 17,016,534 | ||||||
|
|
|
|||||||
| 23,241,511 | ||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
39 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI USA ESG Select ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Media — 0.1% | ||||||||
|
Omnicom Group Inc. |
34,204 | $ | 1,614,429 | |||||
|
|
|
|||||||
| Multi-Utilities — 1.3% | ||||||||
|
CMS Energy Corp. |
170,111 | 10,773,130 | ||||||
|
Consolidated Edison Inc. |
46,978 | 3,687,303 | ||||||
|
Public Service Enterprise Group Inc. |
91,525 | 5,322,179 | ||||||
|
Sempra Energy |
26,072 | 3,268,386 | ||||||
|
|
|
|||||||
| 23,050,998 | ||||||||
| Multiline Retail — 0.3% | ||||||||
|
Target Corp. |
30,338 | 4,618,050 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 0.9% | ||||||||
|
ConocoPhillips |
265,845 | 7,608,484 | ||||||
|
Hess Corp. |
161,925 | 6,026,848 | ||||||
|
ONEOK Inc. |
109,567 | 3,177,443 | ||||||
|
|
|
|||||||
| 16,812,775 | ||||||||
| Pharmaceuticals — 1.7% | ||||||||
|
Merck & Co. Inc. |
214,617 | 16,141,344 | ||||||
|
Zoetis Inc. |
90,783 | 14,393,645 | ||||||
|
|
|
|||||||
| 30,534,989 | ||||||||
| Professional Services — 0.3% | ||||||||
|
IHS Markit Ltd. |
42,677 | 3,451,289 | ||||||
|
Robert Half International Inc. |
34,026 | 1,724,778 | ||||||
|
|
|
|||||||
| 5,176,067 | ||||||||
| Real Estate Management & Development — 0.9% | ||||||||
|
CBRE Group Inc., Class A(a) |
319,275 | 16,091,460 | ||||||
|
|
|
|||||||
| Road & Rail — 0.7% | ||||||||
|
CSX Corp. |
24,818 | 1,959,133 | ||||||
|
Kansas City Southern |
35,594 | 6,269,527 | ||||||
|
Norfolk Southern Corp. |
19,373 | 4,051,282 | ||||||
|
|
|
|||||||
| 12,279,942 | ||||||||
| Semiconductors & Semiconductor Equipment — 4.5% | ||||||||
|
Advanced Micro Devices Inc.(a) |
22,775 | 1,714,730 | ||||||
|
Applied Materials Inc. |
191,788 | 11,359,603 | ||||||
|
Intel Corp. |
282,334 | 12,501,749 | ||||||
|
Lam Research Corp. |
10,799 | 3,694,122 | ||||||
|
NVIDIA Corp. |
69,067 | 34,627,431 | ||||||
|
Texas Instruments Inc. |
123,713 | 17,887,663 | ||||||
|
|
|
|||||||
| 81,785,298 | ||||||||
| Software — 11.9% | ||||||||
|
Adobe Inc.(a) |
47,202 | 21,104,014 | ||||||
|
Autodesk Inc.(a) |
62,534 | 14,729,258 | ||||||
|
Cadence Design Systems Inc.(a) |
77,673 | 8,495,096 | ||||||
|
Intuit Inc. |
42,139 | 13,260,301 | ||||||
|
Microsoft Corp. |
437,702 | 88,621,524 | ||||||
|
salesforce.com Inc.(a) |
236,128 | 54,845,451 | ||||||
|
ServiceNow Inc.(a) |
9,313 | 4,633,869 | ||||||
|
Slack Technologies Inc., Class A(a) |
64,066 | 1,638,808 | ||||||
|
Splunk Inc.(a) |
11,897 | 2,356,082 | ||||||
|
VMware Inc., Class A(a) |
21,738 | 2,798,333 | ||||||
|
Workday Inc., Class A(a) |
10,152 | 2,133,138 | ||||||
|
|
|
|||||||
| 214,615,874 | ||||||||
| Specialty Retail — 4.7% | ||||||||
|
Best Buy Co. Inc. |
197,866 | 22,071,952 | ||||||
|
Home Depot Inc. (The) |
135,210 | 36,061,859 | ||||||
|
Lowe’s Companies Inc. |
63,290 | 10,006,149 | ||||||
|
Tiffany & Co. |
120,685 | 15,790,426 | ||||||
| 40 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI USA ESG Select ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Specialty Retail (continued) | ||||||||
|
Tractor Supply Co. |
12,894 | $ | 1,717,610 | |||||
|
|
|
|||||||
| 85,647,996 | ||||||||
| Technology Hardware, Storage & Peripherals — 5.5% | ||||||||
|
Apple Inc. |
793,259 | 86,354,175 | ||||||
|
Hewlett Packard Enterprise Co. |
928,988 | 8,026,456 | ||||||
|
HP Inc. |
233,915 | 4,201,113 | ||||||
|
|
|
|||||||
| 98,581,744 | ||||||||
| Textiles, Apparel & Luxury Goods — 1.0% | ||||||||
|
Lululemon Athletica Inc.(a)(c) |
10,459 | 3,339,454 | ||||||
|
Nike Inc., Class B |
66,737 | 8,013,779 | ||||||
|
VF Corp. |
113,888 | 7,653,274 | ||||||
|
|
|
|||||||
| 19,006,507 | ||||||||
| Trading Companies & Distributors — 0.2% | ||||||||
|
WW Grainger Inc. |
8,342 | 2,919,867 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
1,802,151,865 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 1.0% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(b)(d)(e) |
14,332,244 | 14,342,277 | ||||||
| Security | Shares | Value | ||||||
| Money Market Funds (continued) | ||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(d) |
4,020,000 | $ | 4,020,000 | |||||
|
|
|
|||||||
| 18,362,277 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.0%
|
|
18,362,277 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.8%
|
|
1,820,514,142 | ||||||
|
Other Assets, Less Liabilities — (0.8)% |
|
(14,850,542 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 1,805,663,600 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
All or a portion of this security is on loan. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 22,720,423 | $ | — | $ | (8,375,408 | )(a) | $ | 31,168 | $ | (33,906 | ) | $ | 14,342,277 | 14,332,244 | $ | 62,560 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
2,410,000 | 1,610,000 | (a) | — | — | — | 4,020,000 | 4,020,000 | 2,149 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
29,633,413 | 7,476,700 | (6,417,678 | ) | 363,546 | 5,067,993 | 36,123,974 | 60,286 | 392,668 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 394,714 | $ | 5,034,087 | $ | 54,486,251 | $ | 457,377 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
19 | 12/18/20 | $ | 3,101 | $ | (128,324 | ) | |||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
41 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® MSCI USA ESG Select ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 128,324 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 976,785 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (463,245 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 3,995,725 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,802,151,865 | $ | — | $ | — | $ | 1,802,151,865 | ||||||||
|
Money Market Funds |
18,362,277 | — | — | 18,362,277 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,820,514,142 | $ | — | $ | — | $ | 1,820,514,142 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (128,324 | ) | $ | — | $ | — | $ | (128,324 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 42 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Assets and Liabilities (unaudited)
October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
43 |
Statements of Assets and Liabilities (unaudited) (continued)
October 31, 2020
See notes to financial statements.
| 44 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Operations (unaudited)
Six Months Ended October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
45 |
Statements of Operations (unaudited) (continued)
Six Months Ended October 31, 2020
See notes to financial statements.
| 46 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
47 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 48 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
49 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 50 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
(For a share outstanding throughout each period)
| iShares U.S. Basic Materials ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 81.27 | $ | 94.03 | $ | 97.37 | $ | 89.37 | $ | 77.65 | $ | 84.59 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.77 | 1.65 | 1.63 | 1.39 | 1.34 | 1.39 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
15.95 | (12.42 | ) | (3.49 | ) | 8.16 | 11.62 | (6.93 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
16.72 | (10.77 | ) | (1.86 | ) | 9.55 | 12.96 | (5.54 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.82 | ) | (1.99 | ) | (1.48 | ) | (1.55 | ) | (1.24 | ) | (1.40 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.82 | ) | (1.99 | ) | (1.48 | ) | (1.55 | ) | (1.24 | ) | (1.40 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 97.17 | $ | 81.27 | $ | 94.03 | $ | 97.37 | $ | 89.37 | $ | 77.65 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
20.62 | %(d) | (11.59 | )% | (1.89 | )% | 10.74 | % | 16.88 | % | (6.42 | )% | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
1.61 | %(e) | 1.83 | % | 1.71 | % | 1.44 | % | 1.62 | % | 1.88 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 641,305 | $ | 256,007 | $ | 423,128 | $ | 632,934 | $ | 960,747 | $ | 551,283 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
15 | %(d) | 11 | % | 28 | % | 6 | % | 13 | % | 13 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
51 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Consumer Goods ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 119.38 | $ | 123.43 | $ | 114.08 | $ | 119.04 | $ | 111.98 | $ | 105.19 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
1.21 | 2.77 | 3.04 | 2.50 | 2.32 | 2.31 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
25.32 | (3.83 | ) | 9.24 | (5.24 | ) | 7.66 | 6.90 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
26.53 | (1.06 | ) | 12.28 | (2.74 | ) | 9.98 | 9.21 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(1.23 | ) | (2.99 | ) | (2.93 | ) | (2.22 | ) | (2.92 | ) | (2.42 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(1.23 | ) | (2.99 | ) | (2.93 | ) | (2.22 | ) | (2.92 | ) | (2.42 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 144.68 | $ | 119.38 | $ | 123.43 | $ | 114.08 | $ | 119.04 | $ | 111.98 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
22.28 | %(d) | (0.86 | )% | 10.95 | % | (2.41 | )% | 9.04 | % | 8.88 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
1.73 | %(e) | 2.22 | % | 2.61 | % | 2.05 | % | 2.03 | % | 2.15 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 614,881 | $ | 471,555 | $ | 469,043 | $ | 433,499 | $ | 720,184 | $ | 951,869 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
3 | %(d) | 5 | % | 4 | % | 7 | % | 7 | % | 4 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 52 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Consumer Services ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 204.66 | $ | 217.24 | $ | 185.42 | $ | 165.24 | $ | 144.34 | $ | 142.60 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.76 | 2.07 | 1.60 | 1.81 | 1.52 | 1.42 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
37.94 | (12.46 | ) | 31.79 | 20.10 | 20.99 | 1.74 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
38.70 | (10.39 | ) | 33.39 | 21.91 | 22.51 | 3.16 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.79 | ) | (2.19 | ) | (1.57 | ) | (1.73 | ) | (1.61 | ) | (1.42 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.79 | ) | (2.19 | ) | (1.57 | ) | (1.73 | ) | (1.61 | ) | (1.42 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 242.57 | $ | 204.66 | $ | 217.24 | $ | 185.42 | $ | 165.24 | $ | 144.34 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
18.93 | %(d) | (4.79 | )% | 18.09 | % | 13.35 | % | 15.71 | % | 2.23 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.43 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
0.65 | %(e) | 0.96 | % | 0.81 | % | 1.04 | % | 1.01 | % | 0.99 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,030,938 | $ | 798,171 | $ | 934,120 | $ | 741,682 | $ | 669,218 | $ | 959,877 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
11 | %(d) | 31 | % | 15 | % | 10 | % | 8 | % | 9 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
53 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Financial Services ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 115.36 | $ | 136.07 | $ | 130.98 | $ | 108.38 | $ | 85.36 | $ | 91.03 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
1.28 | 2.58 | 2.17 | 1.73 | 1.47 | 1.28 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
3.88 | (20.69 | ) | 5.12 | 22.56 | 22.88 | (5.66 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
5.16 | (18.11 | ) | 7.29 | 24.29 | 24.35 | (4.38 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.98 | ) | (2.60 | ) | (2.20 | ) | (1.69 | ) | (1.33 | ) | (1.29 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.98 | ) | (2.60 | ) | (2.20 | ) | (1.69 | ) | (1.33 | ) | (1.29 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 119.54 | $ | 115.36 | $ | 136.07 | $ | 130.98 | $ | 108.38 | $ | 85.36 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
4.48 | %(d) | (13.46 | )% | 5.72 | % | 22.53 | % | 28.74 | % | (4.85 | )% | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.42 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
2.07 | %(e) | 1.90 | % | 1.68 | % | 1.40 | % | 1.49 | % | 1.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 968,242 | $ | 865,166 | $ | 1,435,523 | $ | 1,643,780 | $ | 1,430,646 | $ | 567,660 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
5 | %(d) | 7 | % | 4 | % | 4 | % | 4 | % | 5 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 54 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Financials ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 106.77 | $ | 125.93 | $ | 117.71 | $ | 103.79 | $ | 86.91 | $ | 88.81 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
1.20 | 2.33 | 2.07 | 1.82 | 1.64 | 1.44 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
4.22 | (19.10 | ) | 8.33 | 13.89 | 16.91 | (1.81 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
5.42 | (16.77 | ) | 10.40 | 15.71 | 18.55 | (0.37 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(1.08 | ) | (2.39 | ) | (2.18 | ) | (1.79 | ) | (1.67 | ) | (1.53 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(1.08 | ) | (2.39 | ) | (2.18 | ) | (1.79 | ) | (1.67 | ) | (1.53 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 111.11 | $ | 106.77 | $ | 125.93 | $ | 117.71 | $ | 103.79 | $ | 86.91 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
5.08 | %(d) | (13.47 | )% | 9.01 | % | 15.21 | % | 21.52 | % | (0.41 | )% | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.42 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
2.11 | %(e) | 1.85 | % | 1.75 | % | 1.59 | % | 1.70 | % | 1.64 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,183,285 | $ | 1,233,235 | $ | 1,693,736 | $ | 2,295,315 | $ | 1,681,324 | $ | 1,173,295 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
8 | %(d) | 6 | % | 8 | % | 6 | % | 6 | % | 6 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
55 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares U.S. Industrials ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 137.95 | $ | 158.24 | $ | 141.60 | $ | 128.60 | $ | 108.65 | $ | 107.35 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.88 | 2.06 | 1.89 | 1.78 | 1.82 | 1.59 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
26.27 | (20.24 | ) | 16.79 | 13.06 | 19.89 | 1.35 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
27.15 | (18.18 | ) | 18.68 | 14.84 | 21.71 | 2.94 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.87 | ) | (2.11 | ) | (2.04 | ) | (1.84 | ) | (1.76 | ) | (1.64 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.87 | ) | (2.11 | ) | (2.04 | ) | (1.84 | ) | (1.76 | ) | (1.64 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 164.23 | $ | 137.95 | $ | 158.24 | $ | 141.60 | $ | 128.60 | $ | 108.65 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
19.72 | %(d) | (11.57 | )% | 13.34 | % | 11.57 | % | 20.13 | % | 2.83 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.42 | %(e) | 0.42 | % | 0.42 | % | 0.43 | % | 0.44 | % | 0.44 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
1.10 | %(e) | 1.32 | % | 1.29 | % | 1.27 | % | 1.55 | % | 1.54 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 936,111 | $ | 682,848 | $ | 941,547 | $ | 1,033,654 | $ | 983,820 | $ | 733,417 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
2 | %(d) | 4 | % | 5 | % | 7 | % | 10 | % | 7 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 56 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
|
iShares MSCI KLD 400 Social ETF |
||||||||||||||||||||||||||||||
|
Six Months Ended
(unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 110.05 | $ | 109.76 | $ | 98.14 | $ | 88.02 | $ | 76.44 | $ | 77.09 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net investment income(a) |
0.85 | 1.80 | 1.65 | 1.36 | 1.22 | 1.17 | ||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
14.73 | 0.26 | 11.64 | 10.01 | 11.54 | (0.62 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net increase from investment operations |
15.58 | 2.06 | 13.29 | 11.37 | 12.76 | 0.55 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||
|
From net investment income |
(0.79 | ) | (1.77 | ) | (1.67 | ) | (1.25 | ) | (1.18 | ) | (1.20 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total distributions |
(0.79 | ) | (1.77 | ) | (1.67 | ) | (1.25 | ) | (1.18 | ) | (1.20 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net asset value, end of period |
$ | 124.84 | $ | 110.05 | $ | 109.76 | $ | 98.14 | $ | 88.02 | $ | 76.44 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total Return |
|
|||||||||||||||||||||||||||||
|
Based on net asset value |
14.19 | %(d) | 1.95 | % | 13.70 | % | 12.99 | % | 16.83 | % | 0.75 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(e) | 0.25 | % | 0.28 | % | 0.50 | % | 0.50 | % | 0.50 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total expenses after fees waived |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.48 | % | 0.50 | % | 0.50 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net investment income |
1.37 | %(e) | 1.61 | % | 1.61 | % | 1.43 | % | 1.49 | % | 1.55 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 2,197,181 | $ | 1,793,824 | $ | 1,415,953 | $ | 1,035,423 | $ | 822,945 | $ | 500,677 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Portfolio turnover rate(f) |
3 | %(d) | 6 | % | 13 | % | 11 | % | 10 | % | 16 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
57 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
|
iShares MSCI USA ESG Select ETF |
||||||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 123.35 | $ | 122.16 | $ | 110.83 | $ | 99.72 | $ | 85.12 | $ | 86.39 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net investment income(a) |
1.03 | 2.00 | 1.95 | 1.68 | 1.41 | 1.32 | ||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
21.00 | 1.29 | 11.26 | 10.98 | 14.57 | (1.29 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net increase from investment operations |
22.03 | 3.29 | 13.21 | 12.66 | 15.98 | 0.03 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||
|
From net investment income |
(0.93 | ) | (2.10 | ) | (1.88 | ) | (1.55 | ) | (1.38 | ) | (1.30 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total distributions |
(0.93 | ) | (2.10 | ) | (1.88 | ) | (1.55 | ) | (1.38 | ) | (1.30 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net asset value, end of period |
$ | 144.45 | $ | 123.35 | $ | 122.16 | $ | 110.83 | $ | 99.72 | $ | 85.12 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total Return |
|
|||||||||||||||||||||||||||||
|
Based on net asset value |
17.90 | %(d) | 2.76 | % | 12.07 | % | 12.76 | % | 18.92 | % | 0.07 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(e) | 0.25 | % | 0.28 | % | 0.50 | % | 0.50 | % | 0.50 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Total expenses after fees waived |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.48 | % | 0.50 | % | 0.50 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Net investment income |
1.46 | %(e) | 1.61 | % | 1.71 | % | 1.56 | % | 1.53 | % | 1.58 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,805,664 | $ | 1,289,055 | $ | 1,001,715 | $ | 681,607 | $ | 528,509 | $ | 357,511 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Portfolio turnover rate(f) |
14 | %(d) | 13 | % | 21 | % | 13 | % | 19 | % | 20 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 58 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited)
| 1. |
ORGANIZATION |
iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.
These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):
| iShares ETF |
Diversification Classification |
|||
|
U.S. Basic Materials |
Non-diversified | |||
|
U.S. Consumer Goods |
Non-diversified | |||
|
U.S. Consumer Services |
Diversified | |||
|
U.S. Financial Services |
Non-diversified | |||
|
U.S. Financials |
Diversified | |||
|
U.S. Industrials |
Diversified | |||
|
MSCI KLD 400 Social |
Diversified | |||
|
MSCI USA ESG Select |
Diversified | |||
| 2. |
SIGNIFICANT ACCOUNTING POLICIES |
The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:
Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value. Upon notification from issuers or as estimated by management, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain.
Foreign Taxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its statement of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “Other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2020, if any, are disclosed in the statement of assets and liabilities.
Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.
In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.
Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.
Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.
| 3. |
INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS |
Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. A fund determines the fair value of its financial instruments using
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
59 |
Notes to Financial Statements (unaudited) (continued)
various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.
Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:
| • |
Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price. |
| • |
Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV. |
| • |
Futures contracts are valued based on that day’s last reported settlement price on the exchange where the contract is traded. |
If events (e.g., a market closure, market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and the cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.
Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.
Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:
| • |
Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access; |
| • |
Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs); and |
| • |
Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments). |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgement exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.
| 4. |
SECURITIES AND OTHER INVESTMENTS |
Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.
As of October 31, 2020, any securities on loan were collateralized by cash and/or U.S. government obligations. Cash collateral received was invested in money market funds managed by BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, or its affiliates and is disclosed in the schedules of investments. Any non-cash collateral received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan for each Fund, if any, are also disclosed in its schedule of investments. The market value of any securities on loan as of October 31, 2020 and the value of the related cash collateral are disclosed in the statements of assets and liabilities.
Securities lending transactions are entered into by a fund under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value
| 60 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
of the collateral is typically greater than the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the fund can reinvest cash collateral received in connection with loaned securities.
As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA as of October 31, 2020:
| iShares ETF and Counterparty |
Market Value of
Securities on Loan |
Cash Collateral
Received |
Non-Cash Collateral
Received |
Net Amount | ||||||||||||
|
U.S. Basic Materials |
||||||||||||||||
|
Barclays Bank PLC |
$ | 10,659,496 | $ | 10,659,496 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Consumer Goods |
||||||||||||||||
|
Barclays Bank PLC |
$ | 99,854 | $ | 99,854 | $ | — | $ | — | ||||||||
|
Barclays Capital Inc. |
93,744 | 93,744 | — | — | ||||||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
6,724,464 | 6,724,464 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
859,000 | 859,000 | — | — | ||||||||||||
|
ING Financial Markets LLC |
582,110 | 582,110 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
663,913 | 663,913 | — | — | ||||||||||||
|
SG Americas Securities LLC |
606,300 | 606,300 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 9,629,385 | 9,629,385 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Consumer Services |
||||||||||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
$ | 1,082,826 | $ | 1,082,826 | $ | — | $ | — | ||||||||
|
BNP Paribas Securities Corp. |
29,516 | 29,516 | — | — | ||||||||||||
|
BofA Securities, Inc. |
20,614 | 20,614 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
1,175,326 | 1,175,326 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
1,864,322 | 1,864,322 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
2,976,137 | 2,976,137 | — | — | ||||||||||||
|
Mizuho Securities USA Inc. |
1,240,351 | 1,240,351 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
3,179,844 | 3,179,844 | — | — | ||||||||||||
|
National Financial Services LLC |
1,570,428 | 1,570,428 | — | — | ||||||||||||
|
SG Americas Securities LLC |
708,601 | 708,601 | — | — | ||||||||||||
|
UBS AG |
884,475 | 884,475 | — | — | ||||||||||||
|
UBS Securities LLC |
3,111,299 | 3,111,299 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 17,843,739 | 17,843,739 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Financial Services |
||||||||||||||||
|
BofA Securities, Inc. |
$ | 1,311,430 | $ | 1,311,430 | $ | — | $ | — | ||||||||
|
Morgan Stanley & Co. LLC |
673,781 | 673,781 | — | — | ||||||||||||
|
UBS Securities LLC |
818,036 | 818,036 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 2,803,247 | 2,803,247 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Financials |
||||||||||||||||
|
BofA Securities, Inc. |
$ | 536,616 | $ | 536,616 | $ | — | $ | — | ||||||||
|
Citigroup Global Markets Inc. |
296,331 | 296,331 | — | — | ||||||||||||
|
Jefferies LLC |
210,557 | 210,557 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
252,194 | 252,194 | — | — | ||||||||||||
|
UBS Securities LLC |
643,944 | 643,944 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 1,939,642 | 1,939,642 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Industrials |
||||||||||||||||
|
JPMorgan Securities LLC |
$ | 486,157 | $ | 486,157 | $ | — | $ | — | ||||||||
|
Morgan Stanley & Co. LLC |
1,058,084 | 1,058,084 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 1,544,241 | 1,544,241 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
61 |
Notes to Financial Statements (unaudited) (continued)
| iShares ETF and Counterparty |
Market Value of
Securities on Loan |
Cash Collateral
Received |
Non-Cash Collateral
Received |
Net Amount | ||||||||||||
|
MSCI KLD 400 Social |
||||||||||||||||
|
Barclays Bank PLC |
$ | 182,081 | $ | 182,081 | $ | — | $ | — | ||||||||
|
Barclays Capital Inc. |
35,552 | 35,552 | — | — | ||||||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
225,718 | 225,718 | — | — | ||||||||||||
|
BofA Securities, Inc. |
2,733 | 2,733 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
87,252 | 87,252 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
1,100,636 | 1,100,636 | — | — | ||||||||||||
|
Deutsche Bank Securities Inc. |
503 | 503 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
5,100 | 5,075 | — | (25 | )(b) | |||||||||||
|
JPMorgan Securities LLC |
9,109 | 9,109 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
137,406 | 137,406 | — | — | ||||||||||||
|
UBS AG |
430,821 | 428,685 | — | (2,136 | )(b) | |||||||||||
|
Wells Fargo Securities LLC |
1,907,037 | 1,907,037 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 4,123,948 | 4,121,787 | — | (2,161 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
MSCI USA ESG Select |
||||||||||||||||
|
Barclays Bank PLC |
$ | 5,132,076 | $ | 5,132,076 | $ | — | $ | — | ||||||||
|
BNP Paribas Securities Corp. |
110,125 | 110,125 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
31,929 | 31,929 | — | — | ||||||||||||
|
Deutsche Bank Securities Inc. |
4,310,529 | 4,310,529 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
1,730,753 | 1,730,753 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
2,102,795 | 2,102,795 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 13,418,207 | 13,418,207 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s statement of assets and liabilities. |
| (b) |
Additional collateral is delivered to the Fund on the next business day in accordance with the MSLA. The net amount would be subject to the borrower default indemnity in the event of default by a counterparty. |
The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.
| 5. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: Each Fund’s use of futures contracts is generally limited to cash equitization. This involves the use of available cash to invest in index futures contracts in order to gain exposure to the equity markets represented in or by the Fund’s underlying index and is intended to allow the Fund to better track its underlying index. Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).
Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the statement of assets and liabilities.
Securities deposited as initial margin are designated in the schedule of investments and cash deposited, if any, are shown as cash pledged for futures contracts in the statement of assets and liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the statement of assets and liabilities. When the contract is closed, a realized gain or loss is recorded in the statement of operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.
| 62 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 6. |
INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES |
Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).
For its investment advisory services to each of the iShares U.S. Basic Materials, iShares U.S. Consumer Goods, iShares U.S. Consumer Services, iShares U.S. Financial Services, iShares U.S. Financials and iShares U.S. Industrials ETFs, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on each Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:
| Aggregate Average Daily Net Assets | Investment Advisory Fee | |||
|
First $10 billion |
0.48 | % | ||
|
Over $10 billion, up to and including $20 billion |
0.43 | |||
|
Over $20 billion, up to and including $30 billion |
0.38 | |||
|
Over $30 billion, up to and including $40 billion |
0.34 | |||
|
Over $40 billion, up to and including $50 billion |
0.33 | |||
|
Over $50 billion |
0.31 | |||
For its investment advisory services to each of the following Funds, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on the average daily net assets of each Fund as follows:
| iShares ETF | Investment Advisory Fee | |||
|
MSCI KLD 400 Social |
0.25 | % | ||
|
MSCI USA ESG Select |
0.25 | |||
Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.
Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.
Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.
Pursuant to the current securities lending agreement, each Fund retains 75% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in that calendar year exceeds a specified threshold, each Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 80% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its statement of operations. For the six months ended October 31, 2020, the Funds paid BTC the following amounts for securities lending agent services:
| iShares ETF |
Fees Paid
to BTC |
|||
|
U.S. Basic Materials |
$ | 9,588 | ||
|
U.S. Consumer Goods |
5,140 | |||
|
U.S. Consumer Services |
63,081 | |||
|
U.S. Financial Services |
24,475 | |||
|
U.S. Financials |
9,993 | |||
|
U.S. Industrials |
7,911 | |||
|
MSCI KLD 400 Social |
20,630 | |||
|
MSCI USA ESG Select |
23,484 | |||
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
63 |
Notes to Financial Statements (unaudited) (continued)
Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.
Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.
For the six months ended October 31, 2020, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:
| iShares ETF | Purchases | Sales |
Net Realized
Gain (Loss) |
|||||||||
|
U.S. Basic Materials |
$ | 10,563,954 | $ | 980,718 | $ | (1,059,977 | ) | |||||
|
U.S. Consumer Goods |
2,905,845 | 1,992,385 | (1,514,587 | ) | ||||||||
|
U.S. Consumer Services |
17,707,969 | 20,210,435 | (8,860,479 | ) | ||||||||
|
U.S. Financial Services |
15,822,786 | 3,991,353 | (2,353,417 | ) | ||||||||
|
U.S. Financials |
37,436,973 | 15,870,694 | (6,400,908 | ) | ||||||||
|
U.S. Industrials |
5,421,128 | 1,851,815 | (3,045,288 | ) | ||||||||
|
MSCI KLD 400 Social |
26,065,878 | 20,264,846 | (3,640,389 | ) | ||||||||
|
MSCI USA ESG Select |
137,790,657 | 89,315,220 | 5,726,254 | |||||||||
Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends – affiliated in the statement of operations.
A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.
| 7. |
PURCHASES AND SALES |
For the six months ended October 31, 2020, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
| iShares ETF | Purchases | Sales | ||||||
|
U.S. Basic Materials |
$ | 52,892,557 | $ | 52,311,819 | ||||
|
U.S. Consumer Goods |
16,521,605 | 16,406,048 | ||||||
|
U.S. Consumer Services |
110,157,097 | 111,058,288 | ||||||
|
U.S. Financial Services |
67,822,362 | 82,492,355 | ||||||
|
U.S. Financials |
100,430,827 | 102,655,629 | ||||||
|
U.S. Industrials |
19,876,756 | 18,684,425 | ||||||
|
MSCI KLD 400 Social |
70,897,354 | 68,375,713 | ||||||
|
MSCI USA ESG Select |
217,609,215 | 214,647,881 | ||||||
For the six months ended October 31, 2020, purchases and sales related to in-kind transactions were as follows:
| iShares ETF |
In-kind Purchases |
In-kind Sales |
||||||
|
U.S. Basic Materials |
$ | 386,821,735 | $ | 44,662,706 | ||||
|
U.S. Consumer Goods |
165,097,842 | 122,621,712 | ||||||
|
U.S. Consumer Services |
243,383,362 | 171,140,549 | ||||||
|
U.S. Financial Services |
1,166,481,125 | 1,086,216,552 | ||||||
|
U.S. Financials |
667,441,072 | 747,509,145 | ||||||
|
U.S. Industrials |
150,348,848 | 22,653,114 | ||||||
|
MSCI KLD 400 Social |
190,978,300 | 28,677,422 | ||||||
|
MSCI USA ESG Select |
370,538,296 | 80,586,525 | ||||||
| 8. |
INCOME TAX INFORMATION |
Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.
Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2020, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.
As of April 30, 2020, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
| 64 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| iShares ETF | Non-Expiring | |||
|
U.S. Basic Materials |
$ | 116,107,099 | ||
|
U.S. Consumer Goods |
11,570,227 | |||
|
U.S. Consumer Services |
41,922,026 | |||
|
U.S. Financial Services |
19,322,487 | |||
|
U.S. Financials |
14,442,779 | |||
|
U.S. Industrials |
13,608,711 | |||
|
MSCI KLD 400 Social |
6,886,000 | |||
|
MSCI USA ESG Select |
10,341,796 | |||
As of October 31, 2020, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:
| iShares ETF | Tax Cost |
Gross Unrealized
Appreciation |
Gross Unrealized
Depreciation |
Net Unrealized
Appreciation (Depreciation) |
||||||||||||
|
U.S. Basic Materials |
$ | 679,071,191 | $ | 25,025,374 | $ | (51,791,082 | ) | $ | (26,765,708 | ) | ||||||
|
U.S. Consumer Goods |
595,049,659 | 104,525,942 | (75,047,449 | ) | 29,478,493 | |||||||||||
|
U.S. Consumer Services |
955,145,065 | 179,699,363 | (85,487,142 | ) | 94,212,221 | |||||||||||
|
U.S. Financial Services |
1,184,850,263 | 6,397,102 | (221,178,737 | ) | (214,781,635 | ) | ||||||||||
|
U.S. Financials |
1,434,642,047 | 19,696,401 | (269,534,494 | ) | (249,838,093 | ) | ||||||||||
|
U.S. Industrials |
904,528,415 | 149,889,475 | (116,438,442 | ) | 33,451,033 | |||||||||||
|
MSCI KLD 400 Social |
1,709,965,184 | 593,537,108 | (99,857,583 | ) | 493,679,525 | |||||||||||
|
MSCI USA ESG Select |
1,507,921,708 | 365,801,302 | (53,337,192 | ) | 312,464,110 | |||||||||||
| 9. |
PRINCIPAL RISKS |
In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.
BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.
The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.
Market Risk: An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.
Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A fund may invest in illiquid investments. An illiquid investment is any investment that a fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A fund may experience difficulty in selling illiquid investments in a timely manner at the price that it believes the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause a fund’s NAV to experience significant increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a fund may lose value, regardless of the individual results of the securities and other instruments in which a fund invests.
Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the statement of assets and liabilities, less any collateral held by the Funds.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
65 |
Notes to Financial Statements (unaudited) (continued)
A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.
With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.
Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.
Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific sectors are presented in the schedule of investments.
LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021, and it is expected that LIBOR will cease to be published after that time. The Funds may be exposed to financial instruments tied to LIBOR to determine payment obligations, financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Funds is uncertain.
| 10. |
CAPITAL SHARE TRANSACTIONS |
Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.
Transactions in capital shares were as follows:
|
Six Months Ended
10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
|
U.S. Basic Materials |
||||||||||||||||
|
Shares sold |
3,950,000 | $ | 388,013,883 | 500,000 | $ | 42,812,086 | ||||||||||
|
Shares redeemed |
(500,000 | ) | (44,788,912 | ) | (1,850,000 | ) | (161,533,178 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
3,450,000 | 343,224,971 | (1,350,000 | ) | (118,721,092 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Consumer Goods |
||||||||||||||||
|
Shares sold |
1,150,000 | 165,536,517 | 600,000 | 74,072,202 | ||||||||||||
|
Shares redeemed |
(850,000 | ) | (122,936,767 | ) | (450,000 | ) | (55,867,093 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
300,000 | 42,599,750 | 150,000 | 18,205,109 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Consumer Services |
||||||||||||||||
|
Shares sold |
1,050,000 | 243,769,226 | 1,750,000 | 369,991,124 | ||||||||||||
|
Shares redeemed |
(700,000 | ) | (171,560,461 | ) | (2,150,000 | ) | (453,621,072 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
350,000 | 72,208,765 | (400,000 | ) | (83,629,948 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Financial Services |
||||||||||||||||
|
Shares sold |
9,400,000 | 1,172,288,565 | 2,250,000 | 313,792,935 | ||||||||||||
|
Shares redeemed |
(8,800,000 | ) | (1,108,449,259 | ) | (5,300,000 | ) | (676,235,485 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
600,000 | 63,839,306 | (3,050,000 | ) | (362,442,550 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Financials |
||||||||||||||||
|
Shares sold |
5,950,000 | 670,491,611 | 7,650,000 | 923,744,884 | ||||||||||||
|
Shares redeemed |
(6,850,000 | ) | (754,668,247 | ) | (9,550,000 | ) | (1,131,180,492 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(900,000 | ) | (84,176,636 | ) | (1,900,000 | ) | (207,435,608 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
U.S. Industrials |
||||||||||||||||
|
Shares sold |
900,000 | 150,840,410 | 800,000 | 127,906,850 | ||||||||||||
|
Shares redeemed |
(150,000 | ) | (22,723,657 | ) | (1,800,000 | ) | (270,032,446 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
750,000 | 128,116,753 | (1,000,000 | ) | (142,125,596 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 66 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
|
Six Months Ended
10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
|
MSCI KLD 400 Social |
||||||||||||||||
|
Shares sold |
1,550,000 | $ | 191,557,543 | 4,150,000 | 463,954,811 | |||||||||||
|
Shares redeemed |
(250,000 | ) | (28,750,285 | ) | (750,000 | ) | (81,188,171 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
1,300,000 | 162,807,258 | 3,400,000 | 382,766,640 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
MSCI USA ESG Select |
||||||||||||||||
|
Shares sold |
2,600,000 | 371,644,167 | 4,150,000 | 507,863,039 | ||||||||||||
|
Shares redeemed |
(550,000 | ) | (80,468,182 | ) | (1,900,000 | ) | (235,871,724 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
2,050,000 | 291,175,985 | 2,250,000 | 271,991,315 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.
From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the statement of assets and liabilities.
| 11. |
LEGAL PROCEEDINGS |
On June 16, 2016, investors in certain iShares funds (iShares Core S&P Small-Cap ETF, iShares Russell 1000 Growth ETF, iShares Core S&P 500 ETF, iShares Russell Mid-Cap Growth ETF, iShares Russell Mid-Cap ETF, iShares Russell Mid-Cap Value ETF, iShares Select Dividend ETF, iShares Morningstar Mid-Cap ETF, iShares Morningstar Large-Cap ETF, iShares U.S. Aerospace & Defense ETF and iShares Preferred and Income Securities ETF) filed a class action lawsuit against iShares Trust, BlackRock, Inc. and certain of its advisory affiliates, and certain directors/trustees and officers of the Funds (collectively, “Defendants”) in California State Court. The lawsuit alleges the Defendants violated federal securities laws by failing to adequately disclose in the prospectuses issued by the funds noted above the risks of using stop-loss orders in the event of a ‘flash crash’, such as the one that occurred on May 6, 2010. On September 18, 2017, the court issued a Statement of Decision holding that the Plaintiffs lack standing to assert their claims. On October 11, 2017, the court entered final judgment dismissing all of the Plaintiffs’ claims with prejudice. In an opinion dated January 23, 2020, the California Court of Appeal affirmed the dismissal of Plaintiffs’ claims. On March 3, 2020, plaintiffs filed a petition for review by the California Supreme Court. On May 27, 2020, the California Supreme Court denied Plaintiff’s petition for review. The case is now closed.
Certain iShares funds (the “Impacted Funds”), along with thousands of other former shareholders of Tribune Company (“Tribune”), were named as defendants in one or more lawsuits (the “Litigation”) arising out of Tribune’s 2007 leveraged buyout transaction (“LBO”). The Litigation seeks to “claw back” from former Tribune shareholders, including the Impacted Funds, proceeds received in connection with the LBO. The iShares U.S. Consumer Services ETF and iShares MSCI KLD 400 Social ETF received proceeds of $336,974 and $23,018, respectively, in the LBO. The claims that were originally brought against the Impacted Funds were dismissed but are currently subject to appeals in multiple appellate courts. The outcome of these appeals could result in new claims being brought against the Impacted Funds and/or previously dismissed claims being revived and subject to continuing litigation. The Impacted Funds intend to vigorously defend the Litigation.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
67 |
Notes to Financial Statements (unaudited) (continued)
| 12. |
SUBSEQUENT EVENTS |
Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were available to be issued and the following items were noted:
On September 17, 2020, the Board approved a stock split for the following Funds, effective after the close of trading on December 4, 2020. The impact of the stock split will be to increase the number of shares outstanding, while decreasing the NAV per share, resulting in no effect on the net assets of the Funds.
| iShares ETF | Forward Share Split | |||
|
U.S. Consumer Services |
4 for 1 | |||
|
U.S. Financials |
2 for 1 | |||
|
U.S. Industrials |
2 for 1 | |||
|
MSCI KLD 400 Social |
2 for 1 | |||
|
MSCI USA ESG Select |
2 for 1 | |||
| 68 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Board Review and Approval of Investment Advisory Contract
iShares U.S. Basic Materials ETF, iShares U.S. Consumer Goods ETF, iShares U.S. Consumer Services ETF, iShares U.S. Industrials ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares
|
B O A R D R E V I E W A N D A P P R O V A L O F I N V E S T M E N T A D V I S O R Y C O N T R A C T |
69 |
Board Review and Approval of Investment Advisory Contract (continued)
funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares U.S. Financial Services ETF, iShares U.S. Financials ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers;
| 70 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Board Review and Approval of Investment Advisory Contract (continued)
risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue,
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including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares MSCI KLD 400 Social ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with
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independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
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Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares MSCI USA ESG Select ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the
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extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through
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relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
| 76 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Supplemental Information (unaudited)
Section 19(a) Notices
The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.
October 31, 2020
|
Total Cumulative
Distributions
for the Fiscal Year-to-Date |
% Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date |
|||||||||||||||||||||||||||||||
| iShares ETF |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
||||||||||||||||||||||||
|
U.S. Consumer Services(a) |
$ | 0.785955 | $ | — | $ | 0.000646 | $ | 0.786601 | 100 | % | — | % | 0 | %(b) | 100 | % | ||||||||||||||||
|
U.S. Financials(a) |
0.887039 | — | 0.190987 | 1.078026 | 82 | — | 18 | 100 | ||||||||||||||||||||||||
|
MSCI KLD 400 Social(a) |
0.784201 | — | 0.009799 | 0.794000 | 99 | — | 1 | 100 | ||||||||||||||||||||||||
|
MSCI USA ESG Select(a) |
0.916723 | — | 0.010016 | 0.926739 | 99 | — | 1 | 100 | ||||||||||||||||||||||||
| (a) |
The Fund estimates that it has distributed more than its net investment income and net realized capital 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 shareholder’s investment in the Fund is returned 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”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share. |
| (b) |
Rounds to less than 1%. |
|
S U P P L E M E N T A L I N F O R M A T I O N |
77 |
Electronic Delivery
Shareholders can sign up for email notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.
To enroll in electronic delivery:
| • |
Go to icsdelivery.com. |
| • |
If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor. |
Householding
Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.
Availability of Quarterly Schedule of Investments
The iShares Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The iShares Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. The iShares Funds also disclose their complete schedule of portfolio holdings on a daily basis on the iShares website at iShares.com.
Availability of Proxy Voting Policies and Proxy Voting Records
A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.
A description of the Company’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.
| 78 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Glossary of Terms Used in this Report
| Portfolio Abbreviations - Equity | ||
| NVS | Non-Voting Shares | |
|
G L O S S A R Y O F T E R M S U S E D I N T H I S R E P O R T |
79 |
Want to know more?
iShares.com | 1-800-474-2737
This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.
Investing involves risk, including possible loss of principal.
The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by MSCI Inc. or S&P Dow Jones Indices LLC, nor do these companies make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the companies listed above.
©2020 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.
iS-SAR-402-1020
|
|
|
|
|
OCTOBER 31, 2020 |
|
2020 Semi-Annual Report (Unaudited)
|
||
iShares Trust
| · |
iShares Core Dividend Growth ETF | DGRO | NYSE Arca |
| · |
iShares Core High Dividend ETF | HDV | NYSE Arca |
| · |
iShares International Select Dividend ETF | IDV | Cboe BZX |
| · |
iShares Select Dividend ETF | DVY | NASDAQ |
| · |
iShares U.S. Dividend and Buyback ETF | DIVB | Cboe BZX |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.
Dear Shareholder,
The 12-month reporting period as of October 31, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus (or “COVID-19”) led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered solid returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.
After markets hit their lowest point of the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which declined marginally during the reporting period. International equities from developed economies declined, significantly lagging emerging market stocks, which rebounded sharply.
During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.
The Fed took an accommodative monetary stance in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted two emergency interest rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.
Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.
Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring emerging market stocks and tilting toward the quality factor for its resilience.
In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.
Sincerely,
Rob Kapito
President, BlackRock, Inc.
Rob Kapito
President, BlackRock, Inc.
|
Total Returns as of October 31, 2020
|
||||||||
|
6-Month
|
12-Month
|
|||||||
|
U.S. large cap equities (S&P 500® Index)
|
13.29% | 9.71% | ||||||
|
U.S. small cap equities (Russell 2000® Index)
|
18.13 | (0.14) | ||||||
|
International equities (MSCI Europe, Australasia, Far East Index)
|
8.57 | (6.86) | ||||||
|
Emerging market equities (MSCI Emerging Markets Index)
|
20.96 | 8.25 | ||||||
|
3-month Treasury bills (ICE BofA 3-Month U.S. Treasury Bill Index)
|
0.06 | 0.92 | ||||||
|
U.S. Treasury securities (ICE BofA 10-Year U.S. Treasury Index)
|
(1.63) | 8.92 | ||||||
|
U.S. investment
grade bonds
|
1.27 | 6.19 | ||||||
|
Tax-exempt
municipal bonds
|
4.87 | 3.55 | ||||||
|
U.S. high yield bonds (Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index)
|
10.73 | 3.42 | ||||||
|
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index
|
||||
| 2 |
T H I S P A G E I S N O T P A R T O F Y O U R F U N D R E P O R T |
| Page | ||||
| 2 | ||||
| 4 | ||||
| 9 | ||||
| 9 | ||||
| 10 | ||||
|
Financial Statements |
||||
| 32 | ||||
| 34 | ||||
| 36 | ||||
| 39 | ||||
| 44 | ||||
| 52 | ||||
| 60 | ||||
| 61 | ||||
| 62 | ||||
| Fund Summary as of October 31, 2020 | iShares® Core Dividend Growth ETF |
Investment Objective
The iShares Core Dividend Growth ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities with a history of consistently growing dividends, as represented by the Morningstar® U.S. Dividend Growth IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years |
Since
Inception |
1 Year | 5 Years |
Since
Inception |
||||||||||||||||||||||
|
Fund NAV |
8.39 | % | 0.22 | % | 10.93 | % | 9.73 | % | 0.22 | % | 67.94 | % | 81.07 | % | ||||||||||||||
|
Fund Market |
8.59 | 0.32 | 10.93 | 9.75 | 0.32 | 67.98 | 81.25 | |||||||||||||||||||||
|
Index |
8.42 | 0.27 | 11.01 | 9.80 | 0.27 | 68.58 | 81.70 | |||||||||||||||||||||
The inception date of the Fund was 6/10/14. The first day of secondary market trading was 6/12/14.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 9 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,083.90 | $ 0.42 | $ 1,000.00 | $ 1,024.80 | $ 0.41 | 0.08 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 9 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|||
|
Financials |
18.7% | |||
|
Information Technology |
18.4 | |||
|
Health Care |
16.2 | |||
|
Consumer Staples |
11.3 | |||
|
Industrials |
11.3 | |||
|
Consumer Discretionary |
6.9 | |||
|
Utilities |
6.1 | |||
|
Communication Services |
4.6 | |||
|
Energy |
3.9 | |||
|
Materials |
2.6 | |||
|
Real Estate |
0.0(b) | |||
| (a) |
Excludes money market funds. |
| (b) |
Rounds to less than 0.1%. |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|||
|
Microsoft Corp. |
3.0% | |||
|
JPMorgan Chase & Co. |
3.0 | |||
|
Verizon Communications Inc. |
2.9 | |||
|
Apple Inc. |
2.9 | |||
|
Johnson & Johnson |
2.8 | |||
|
Chevron Corp. |
2.6 | |||
|
Pfizer Inc. |
2.6 | |||
|
Procter & Gamble Co. (The) |
2.4 | |||
|
Home Depot Inc. (The) |
2.0 | |||
|
Coca-Cola Co. (The) |
1.9 | |||
| 4 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Core High Dividend ETF |
Investment Objective
The iShares Core High Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Morningstar® Dividend Yield Focus IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years |
Since
Inception |
1 Year | 5 Years |
Since
Inception |
||||||||||||||||||||||
|
Fund NAV |
(2.87 | )% | (14.26 | )% | 4.42 | % | 8.30 | % | (14.26 | )% | 24.14 | % | 114.95 | % | ||||||||||||||
|
Fund Market |
(2.76 | ) | (14.27 | ) | 4.42 | 8.30 | (14.27 | ) | 24.12 | 114.98 | ||||||||||||||||||
|
Index |
(2.87 | ) | (14.21 | ) | 4.50 | 8.53 | (14.21 | ) | 24.65 | 119.18 | ||||||||||||||||||
The inception date of the Fund was 3/29/11. The first day of secondary market trading was 3/31/11.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 9 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 971.30 | $ 0.40 | $ 1,000.00 | $ 1,024.80 | $ 0.41 | 0.08 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 9 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|||
|
Health Care |
20.1% | |||
|
Energy |
18.0 | |||
|
Communication Services |
15.7 | |||
|
Consumer Staples |
13.2 | |||
|
Utilities |
11.0 | |||
|
Information Technology |
6.9 | |||
|
Financials |
6.8 | |||
|
Industrials |
6.7 | |||
|
Other (each representing less than 1%) |
1.6 | |||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
| Security |
Percent of
Total Investments(a) |
|||
|
AT&T Inc. |
9.1% | |||
|
Exxon Mobil Corp. |
8.5 | |||
|
Johnson & Johnson |
6.5 | |||
|
Verizon Communications Inc. |
6.5 | |||
|
Chevron Corp. |
5.6 | |||
|
Pfizer Inc. |
5.6 | |||
|
Coca-Cola Co. (The) |
4.1 | |||
|
PepsiCo Inc. |
3.7 | |||
|
Cisco Systems Inc. |
3.7 | |||
|
Merck & Co. Inc. |
3.7 | |||
|
F U N D S U M M A R Y |
5 |
| Fund Summary as of October 31, 2020 | iShares® International Select Dividend ETF |
Investment Objective
The iShares International Select Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying equities in non-U.S. developed markets, as represented by the Dow Jones EPAC Select Dividend IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||
|
Fund NAV |
2.67 | % | (18.36 | )% | 1.21 | % | 2.19 | % | (18.36 | )% | 6.21 | % | 24.17 | % | ||||||||||||||
|
Fund Market |
3.86 | (18.35 | ) | 1.31 | 2.13 | (18.35 | ) | 6.73 | 23.52 | |||||||||||||||||||
|
Index |
2.90 | (18.06 | ) | 1.39 | 2.34 | (18.06 | ) | 7.13 | 26.03 | |||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 9 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a)(b) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a)(b) |
|
Annualized
Expense Ratio |
(a) |
||||||||||
| $ 1,000.00 | $ 1,026.70 | $ 2.50 | $ 1,000.00 | $ 1,022.70 | $ 2.50 | 0.49 | % | |||||||||||||||||||||||
| (a) |
Annualized expense ratio and expenses paid during the period do not include fees and expenses of the underlying fund in which the Fund invests. |
| (b) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 9 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
Percent of
Total Investments(a) |
|||
|
Financials |
31.9% | |||
|
Utilities |
20.4 | |||
|
Materials |
12.7 | |||
|
Communication Services |
9.0 | |||
|
Energy |
7.1 | |||
|
Industrials |
7.0 | |||
|
Real Estate |
4.6 | |||
|
Consumer Staples |
4.4 | |||
|
Health Care |
1.7 | |||
|
Other (each representing less than 1%) |
1.2 | |||
| (a) |
Excludes money market funds |
TEN LARGEST GEOGRAPHIC ALLOCATION
| Country/Geographic Region |
Percent of
Total Investments(a) |
|||
|
United Kingdom |
23.6% | |||
|
Hong Kong |
11.4 | |||
|
Spain |
10.5 | |||
|
Canada |
8.1 | |||
|
Australia |
8.0 | |||
|
Italy |
7.3 | |||
|
Finland |
5.0 | |||
|
Switzerland |
4.6 | |||
|
Japan |
3.4 | |||
|
South Korea |
3.3 | |||
| 6 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Select Dividend ETF |
Investment Objective
The iShares Select Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Dow Jones U.S. Select Dividend IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||
|
Fund NAV |
5.02 | % | (15.14 | )% | 5.17 | % | 9.34 | % | (15.14 | )% | 28.67 | % | 144.30 | % | ||||||||||||||
|
Fund Market |
5.19 | (15.07 | ) | 5.19 | 9.35 | (15.07 | ) | 28.79 | 144.55 | |||||||||||||||||||
|
Index |
5.23 | (14.86 | ) | 5.58 | 9.76 | (14.86 | ) | 31.17 | 153.73 | |||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 9 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,050.20 | $ 2.02 | $ 1,000.00 | $ 1,023.20 | $ 1.99 | 0.39 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 9 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Financials |
25.6 | % | ||
|
Utilities |
23.7 | |||
|
Materials |
8.2 | |||
|
Communication Services |
7.8 | |||
|
Consumer Staples |
7.3 | |||
|
Energy |
7.2 | |||
|
Information Technology |
6.9 | |||
|
Consumer Discretionary |
6.2 | |||
|
Industrials |
5.0 | |||
|
Health Care |
2.1 | |||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Altria Group Inc. |
2.3 | % | ||
|
International Paper Co. |
2.2 | |||
|
Prudential Financial Inc. |
2.1 | |||
|
LyondellBasell Industries NV, Class A |
1.9 | |||
|
Philip Morris International Inc. |
1.8 | |||
|
PPL Corp. |
1.8 | |||
|
Fifth Third Bancorp. |
1.8 | |||
|
AT&T Inc. |
1.7 | |||
|
Wells Fargo & Co. |
1.7 | |||
|
ViacomCBS Inc., Class B |
1.7 | |||
|
F U N D S U M M A R Y |
7 |
| Fund Summary as of October 31, 2020 | iShares® U.S. Dividend and Buyback ETF |
Investment Objective
The iShares U.S. Dividend and Buyback ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. stocks with a history of dividend payments and/or share buybacks, as represented by the Morningstar® US Dividend and Buyback IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||
| 6 Months | 1 Year |
Since
Inception |
1 Year |
Since
Inception |
||||||||||||||||
|
Fund NAV |
8.63 | % | (1.13 | )% | 6.13 | % | (1.13 | )% | 19.41 | % | ||||||||||
|
Fund Market |
8.28 | (1.49 | ) | 6.01 | (1.49 | ) | 19.02 | |||||||||||||
|
Index |
8.77 | (0.93 | ) | 6.41 | (0.93 | ) | 20.33 | |||||||||||||
The inception date of the Fund was 11/7/17. The first day of secondary market trading was 11/9/17.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 9 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,086.30 | $ 1.31 | $ 1,000.00 | $ 1,023.90 | $ 1.28 | 0.25 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 9 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
24.9 | % | ||
|
Financials |
21.1 | |||
|
Health Care |
12.5 | |||
|
Industrials |
8.9 | |||
|
Consumer Discretionary |
8.4 | |||
|
Consumer Staples |
7.0 | |||
|
Communication Services |
6.7 | |||
|
Energy |
4.8 | |||
|
Materials |
2.4 | |||
|
Real Estate |
1.7 | |||
|
Utilities |
1.6 | |||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Apple Inc. |
4.8 | % | ||
|
Microsoft Corp. |
3.4 | |||
|
JPMorgan Chase & Co. |
3.1 | |||
|
Bank of America Corp. |
2.4 | |||
|
Wells Fargo & Co. |
2.3 | |||
|
Cisco Systems Inc. |
1.8 | |||
|
Oracle Corp. |
1.8 | |||
|
AT&T Inc. |
1.7 | |||
|
QUALCOMM Inc. |
1.6 | |||
|
Johnson & Johnson |
1.6 | |||
| 8 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.
Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Since shares of a fund may not trade in the secondary market until after the fund’s inception, for the period from inception to the first day of secondary market trading in shares of the fund, the NAV of the fund is used as a proxy for the Market Price to calculate market returns. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.
An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.
As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses – The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes – The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
|
A B O U T F U N D P E R F O R M A N C E / S H A R E H O L D E R E X P E N S E S |
9 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Core Dividend Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
|
Common Stocks |
||||||||
| Aerospace & Defense — 2.3% | ||||||||
|
BWX Technologies Inc. |
45,563 | $ | 2,506,420 | |||||
|
General Dynamics Corp. |
255,578 | 33,565,059 | ||||||
|
HEICO Corp. |
1,893 | 198,860 | ||||||
|
HEICO Corp., Class A |
4,594 | 429,539 | ||||||
|
Huntington Ingalls Industries Inc. |
43,208 | 6,372,316 | ||||||
|
L3Harris Technologies Inc. |
148,527 | 23,929,185 | ||||||
|
Lockheed Martin Corp. |
224,710 | 78,677,712 | ||||||
|
Northrop Grumman Corp. |
96,839 | 28,065,879 | ||||||
|
Raytheon Technologies Corp. |
1,713,832 | 93,095,354 | ||||||
|
|
|
|||||||
| 266,840,324 | ||||||||
| Air Freight & Logistics — 1.2% | ||||||||
|
CH Robinson Worldwide Inc. |
100,577 | 8,894,024 | ||||||
|
Expeditors International of Washington Inc. |
70,891 | 6,264,638 | ||||||
|
FedEx Corp. |
101,252 | 26,271,856 | ||||||
|
United Parcel Service Inc., Class B |
650,454 | 102,192,828 | ||||||
|
|
|
|||||||
| 143,623,346 | ||||||||
| Auto Components — 0.1% | ||||||||
|
BorgWarner Inc. |
122,173 | 4,273,612 | ||||||
|
Gentex Corp. |
161,390 | 4,465,661 | ||||||
|
|
|
|||||||
| 8,739,273 | ||||||||
| Automobiles — 0.0% | ||||||||
|
Harley-Davidson Inc. |
16,738 | 550,345 | ||||||
|
Thor Industries Inc. |
34,350 | 2,905,323 | ||||||
|
|
|
|||||||
| 3,455,668 | ||||||||
| Banks — 10.6% | ||||||||
|
Associated Banc-Corp. |
308,597 | 4,224,693 | ||||||
|
Atlantic Union Bankshares Corp. |
127,683 | 3,229,103 | ||||||
|
BancorpSouth Bank |
125,738 | 2,943,527 | ||||||
|
Bank of America Corp. |
8,052,518 | 190,844,677 | ||||||
|
Bank OZK |
217,707 | 5,394,779 | ||||||
|
BOK Financial Corp. |
43,339 | 2,545,733 | ||||||
|
Cathay General Bancorp. |
146,121 | 3,438,227 | ||||||
|
Citigroup Inc. |
3,019,081 | 125,050,335 | ||||||
|
Citizens Financial Group Inc. |
897,603 | 24,459,682 | ||||||
|
Columbia Banking System Inc. |
111,706 | 3,173,567 | ||||||
|
Comerica Inc. |
348,958 | 15,881,079 | ||||||
|
Commerce Bancshares Inc. |
70,370 | 4,380,533 | ||||||
|
Community Bank System Inc. |
52,740 | 3,058,393 | ||||||
|
Cullen/Frost Bankers Inc. |
86,611 | 6,086,155 | ||||||
|
CVB Financial Corp. |
195,441 | 3,420,218 | ||||||
|
First Financial Bankshares Inc. |
91,646 | 2,731,967 | ||||||
|
First Horizon National Corp. |
1,279,066 | 13,315,077 | ||||||
|
First Merchants Corp. |
83,632 | 2,183,632 | ||||||
|
First Midwest Bancorp. Inc. |
191,653 | 2,405,245 | ||||||
|
First Republic Bank/CA |
45,973 | 5,799,034 | ||||||
|
Fulton Financial Corp. |
318,238 | 3,497,436 | ||||||
|
Glacier Bancorp. Inc. |
109,838 | 3,932,200 | ||||||
|
Home BancShares Inc./AR |
181,719 | 3,016,535 | ||||||
|
Huntington Bancshares Inc./OH |
2,274,791 | 23,748,818 | ||||||
|
Independent Bank Corp. |
37,810 | 2,166,135 | ||||||
|
Investors Bancorp. Inc. |
453,628 | 3,837,693 | ||||||
|
JPMorgan Chase & Co. |
3,514,250 | 344,537,070 | ||||||
|
KeyCorp |
2,103,271 | 27,300,458 | ||||||
|
PNC Financial Services Group Inc. (The) |
648,813 | 72,589,198 | ||||||
|
Popular Inc. |
140,399 | 5,924,838 | ||||||
|
Prosperity Bancshares Inc. |
118,018 | 6,503,972 | ||||||
|
Regions Financial Corp. |
1,894,064 | 25,191,051 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Banks (continued) | ||||||||
|
ServisFirst Bancshares Inc. |
34,277 | $ | 1,264,821 | |||||
|
Simmons First National Corp., Class A |
159,887 | 2,716,480 | ||||||
|
South State Corp. |
92,616 | 5,686,622 | ||||||
|
Synovus Financial Corp. |
324,380 | 8,433,880 | ||||||
|
TCF Financial Corp. |
297,613 | 8,098,050 | ||||||
|
Truist Financial Corp. |
2,342,726 | 98,675,619 | ||||||
|
U.S. Bancorp. |
2,303,437 | 89,718,871 | ||||||
|
UMB Financial Corp. |
36,809 | 2,240,564 | ||||||
|
United Community Banks Inc./GA |
114,960 | 2,407,262 | ||||||
|
Webster Financial Corp. |
193,879 | 6,244,843 | ||||||
|
Wells Fargo & Co. |
2,284,124 | 48,994,460 | ||||||
|
WesBanco Inc. |
136,181 | 3,307,836 | ||||||
|
Westamerica Bancorp. |
27,736 | 1,452,534 | ||||||
|
Wintrust Financial Corp. |
55,909 | 2,752,400 | ||||||
|
Zions Bancorp NA |
254,305 | 8,206,422 | ||||||
|
|
|
|||||||
| 1,237,011,724 | ||||||||
| Beverages — 3.8% | ||||||||
|
Brown-Forman Corp., Class A |
19,447 | 1,220,299 | ||||||
|
Brown-Forman Corp., Class B, NVS |
57,513 | 4,009,231 | ||||||
|
Coca-Cola Co. (The) |
4,615,177 | 221,805,407 | ||||||
|
Constellation Brands Inc., Class A |
96,571 | 15,956,426 | ||||||
|
PepsiCo Inc. |
1,512,358 | 201,582,198 | ||||||
|
|
|
|||||||
| 444,573,561 | ||||||||
| Biotechnology — 2.0% | ||||||||
|
Amgen Inc. |
560,185 | 121,526,534 | ||||||
|
Gilead Sciences Inc. |
1,931,997 | 112,345,626 | ||||||
|
|
|
|||||||
| 233,872,160 | ||||||||
| Building Products — 0.4% | ||||||||
|
A O Smith Corp. |
98,482 | 5,090,535 | ||||||
|
AAON Inc. |
10,198 | 595,665 | ||||||
|
Advanced Drainage Systems Inc. |
12,700 | 805,561 | ||||||
|
Allegion PLC |
43,801 | 4,314,399 | ||||||
|
Fortune Brands Home & Security Inc. |
59,584 | 4,818,558 | ||||||
|
Lennox International Inc. |
14,324 | 3,891,258 | ||||||
|
Masco Corp. |
90,125 | 4,830,700 | ||||||
|
Owens Corning |
57,812 | 3,784,952 | ||||||
|
Simpson Manufacturing Co. Inc. |
13,495 | 1,197,276 | ||||||
|
Trane Technologies PLC |
158,578 | 21,051,229 | ||||||
|
UFP Industries Inc. |
19,557 | 976,090 | ||||||
|
|
|
|||||||
| 51,356,223 | ||||||||
| Capital Markets — 4.1% | ||||||||
|
Ameriprise Financial Inc. |
123,492 | 19,861,218 | ||||||
|
Bank of New York Mellon Corp. (The) |
1,017,226 | 34,951,885 | ||||||
|
BlackRock Inc.(a) |
146,104 | 87,546,978 | ||||||
|
CME Group Inc. |
265,157 | 39,964,463 | ||||||
|
Cohen & Steers Inc. |
21,476 | 1,209,314 | ||||||
|
Eaton Vance Corp., NVS |
162,779 | 9,732,556 | ||||||
|
Evercore Inc., Class A |
56,114 | 4,463,308 | ||||||
|
FactSet Research Systems Inc. |
12,835 | 3,933,928 | ||||||
|
Franklin Resources Inc. |
538,694 | 10,100,513 | ||||||
|
Goldman Sachs Group Inc. (The) |
279,229 | 52,785,450 | ||||||
|
Intercontinental Exchange Inc. |
237,412 | 22,411,693 | ||||||
|
MarketAxess Holdings Inc. |
7,243 | 3,902,891 | ||||||
|
Moody’s Corp. |
45,645 | 12,000,071 | ||||||
|
Morgan Stanley |
1,200,356 | 57,797,141 | ||||||
|
MSCI Inc. |
27,931 | 9,771,381 | ||||||
|
Nasdaq Inc. |
63,236 | 7,650,924 | ||||||
|
Northern Trust Corp. |
261,595 | 20,475,041 | ||||||
|
Raymond James Financial Inc. |
89,951 | 6,875,854 | ||||||
| 10 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core Dividend Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Capital Markets (continued) | ||||||||
|
S&P Global Inc. |
67,155 | $ | 21,672,933 | |||||
|
SEI Investments Co. |
62,343 | 3,064,158 | ||||||
|
State Street Corp. |
407,155 | 23,981,429 | ||||||
|
T Rowe Price Group Inc. |
231,605 | 29,335,089 | ||||||
|
|
|
|||||||
| 483,488,218 | ||||||||
| Chemicals — 1.9% | ||||||||
|
Air Products & Chemicals Inc. |
142,630 | 39,400,111 | ||||||
|
Albemarle Corp. |
62,845 | 5,857,783 | ||||||
|
Ashland Global Holdings Inc. |
33,245 | 2,319,504 | ||||||
|
Avient Corp. |
98,660 | 3,065,366 | ||||||
|
Balchem Corp. |
5,832 | 582,908 | ||||||
|
Cabot Corp. |
75,488 | 2,869,299 | ||||||
|
Celanese Corp. |
101,016 | 11,466,326 | ||||||
|
Eastman Chemical Co. |
163,648 | 13,229,304 | ||||||
|
Ecolab Inc. |
83,371 | 15,306,082 | ||||||
|
HB Fuller Co. |
24,992 | 1,130,888 | ||||||
|
Innospec Inc. |
13,196 | 872,783 | ||||||
|
International Flavors & Fragrances Inc. |
95,352 | 9,788,836 | ||||||
|
Linde PLC |
294,329 | 64,852,452 | ||||||
|
NewMarket Corp. |
5,485 | 1,961,930 | ||||||
|
PPG Industries Inc. |
148,060 | 19,206,343 | ||||||
|
Quaker Chemical Corp. |
3,854 | 735,305 | ||||||
|
RPM International Inc. |
81,597 | 6,908,818 | ||||||
|
Scotts Miracle-Gro Co. (The) |
22,436 | 3,366,522 | ||||||
|
Sensient Technologies Corp. |
43,755 | 2,862,890 | ||||||
|
Sherwin-Williams Co. (The) |
22,724 | 15,633,658 | ||||||
|
Stepan Co. |
6,852 | 797,847 | ||||||
|
Valvoline Inc. |
153,578 | 3,020,879 | ||||||
|
Westlake Chemical Corp. |
21,152 | 1,430,298 | ||||||
|
|
|
|||||||
| 226,666,132 | ||||||||
| Commercial Services & Supplies — 0.5% | ||||||||
|
ABM Industries Inc. |
46,619 | 1,618,612 | ||||||
|
Brady Corp., Class A, NVS |
33,363 | 1,258,452 | ||||||
|
Cintas Corp. |
24,170 | 7,602,674 | ||||||
|
Healthcare Services Group Inc. |
107,809 | 2,466,670 | ||||||
|
MSA Safety Inc. |
18,499 | 2,440,388 | ||||||
|
Republic Services Inc. |
129,922 | 11,455,223 | ||||||
|
Rollins Inc. |
29,797 | 1,723,756 | ||||||
|
Tetra Tech Inc. |
14,651 | 1,478,432 | ||||||
|
Waste Management Inc. |
274,898 | 29,664,243 | ||||||
|
|
|
|||||||
| 59,708,450 | ||||||||
| Communications Equipment — 1.9% | ||||||||
|
Cisco Systems Inc. |
5,560,533 | 199,623,135 | ||||||
|
Motorola Solutions Inc. |
103,188 | 16,309,895 | ||||||
|
|
|
|||||||
| 215,933,030 | ||||||||
| Construction Materials — 0.1% | ||||||||
|
Vulcan Materials Co. |
53,783 | 7,789,930 | ||||||
|
|
|
|||||||
| Consumer Finance — 0.5% | ||||||||
|
American Express Co. |
399,739 | 36,472,186 | ||||||
|
Discover Financial Services |
358,396 | 23,299,324 | ||||||
|
|
|
|||||||
| 59,771,510 | ||||||||
| Containers & Packaging — 0.3% | ||||||||
|
AptarGroup Inc. |
28,183 | 3,215,398 | ||||||
|
Avery Dennison Corp. |
60,864 | 8,422,969 | ||||||
|
Packaging Corp. of America |
105,049 | 12,027,060 | ||||||
|
Silgan Holdings Inc. |
37,777 | 1,301,418 | ||||||
|
Sonoco Products Co. |
118,156 | 5,776,647 | ||||||
|
|
|
|||||||
| 30,743,492 | ||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
11 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core Dividend Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Food Products (continued) | ||||||||
|
Flowers Foods Inc. |
237,986 | $ | 5,611,710 | |||||
|
Hershey Co. (The) |
116,776 | 16,052,029 | ||||||
|
Hormel Foods Corp. |
188,726 | 9,189,069 | ||||||
|
Ingredion Inc. |
75,511 | 5,352,975 | ||||||
|
J&J Snack Foods Corp. |
8,653 | 1,173,087 | ||||||
|
JM Smucker Co. (The) |
128,960 | 14,469,312 | ||||||
|
Kellogg Co. |
312,101 | 19,628,032 | ||||||
|
Lancaster Colony Corp. |
11,416 | 1,896,654 | ||||||
|
McCormick & Co. Inc./MD, NVS |
55,454 | 10,010,002 | ||||||
|
Mondelez International Inc., Class A |
1,034,643 | 54,960,236 | ||||||
|
Tyson Foods Inc., Class A |
293,943 | 16,822,358 | ||||||
|
|
|
|||||||
| 197,376,990 | ||||||||
| Gas Utilities — 0.4% | ||||||||
|
Atmos Energy Corp. |
106,720 | 9,783,022 | ||||||
|
National Fuel Gas Co. |
136,329 | 5,447,707 | ||||||
|
New Jersey Resources Corp. |
150,942 | 4,404,488 | ||||||
|
ONE Gas Inc. |
58,772 | 4,057,619 | ||||||
|
South Jersey Industries Inc. |
189,482 | 3,651,318 | ||||||
|
Southwest Gas Holdings Inc. |
72,595 | 4,770,943 | ||||||
|
Spire Inc. |
84,166 | 4,716,663 | ||||||
|
UGI Corp. |
300,457 | 9,716,779 | ||||||
|
|
|
|||||||
| 46,548,539 | ||||||||
| Health Care Equipment & Supplies — 2.7% | ||||||||
|
Abbott Laboratories |
879,615 | 92,456,333 | ||||||
|
Baxter International Inc. |
219,160 | 17,000,241 | ||||||
|
Becton Dickinson and Co. |
144,536 | 33,406,606 | ||||||
|
Danaher Corp. |
81,728 | 18,759,845 | ||||||
|
DENTSPLY SIRONA Inc. |
72,615 | 3,426,702 | ||||||
|
Hill-Rom Holdings Inc. |
24,101 | 2,194,878 | ||||||
|
Medtronic PLC |
1,065,876 | 107,195,149 | ||||||
|
ResMed Inc. |
46,817 | 8,986,055 | ||||||
|
STERIS PLC |
30,554 | 5,413,863 | ||||||
|
Stryker Corp. |
131,986 | 26,662,492 | ||||||
|
West Pharmaceutical Services Inc. |
6,328 | 1,721,659 | ||||||
|
|
|
|||||||
| 317,223,823 | ||||||||
| Health Care Providers & Services — 2.3% | ||||||||
|
AmerisourceBergen Corp. |
95,080 | 9,134,336 | ||||||
|
Anthem Inc. |
130,905 | 35,710,884 | ||||||
|
Cardinal Health Inc. |
417,000 | 19,094,430 | ||||||
|
Chemed Corp. |
1,612 | 771,052 | ||||||
|
Encompass Health Corp. |
64,098 | 3,929,848 | ||||||
|
Ensign Group Inc. (The) |
7,416 | 436,357 | ||||||
|
Humana Inc. |
29,398 | 11,738,034 | ||||||
|
McKesson Corp. |
65,456 | 9,654,105 | ||||||
|
Quest Diagnostics Inc. |
102,519 | 12,521,671 | ||||||
|
UnitedHealth Group Inc. |
555,312 | 169,447,904 | ||||||
|
|
|
|||||||
| 272,438,621 | ||||||||
| Hotels, Restaurants & Leisure — 2.2% | ||||||||
|
Aramark |
142,749 | 3,959,857 | ||||||
|
Domino’s Pizza Inc. |
11,718 | 4,433,154 | ||||||
|
McDonald’s Corp. |
629,768 | 134,140,584 | ||||||
|
Royal Caribbean Cruises Ltd. |
278,136 | 15,692,433 | ||||||
|
Starbucks Corp. |
815,267 | 70,895,618 | ||||||
|
Wendy’s Co. (The) |
57,659 | 1,259,849 | ||||||
|
Wyndham Destinations Inc. |
197,166 | 6,433,527 | ||||||
|
Wyndham Hotels & Resorts Inc. |
20,852 | 969,827 | ||||||
|
Yum! Brands Inc. |
220,619 | 20,590,371 | ||||||
|
|
|
|||||||
| 258,375,220 | ||||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Household Durables — 0.2% | ||||||||
|
DR Horton Inc. |
121,157 | $ | 8,094,499 | |||||
|
Leggett & Platt Inc. |
179,792 | 7,502,720 | ||||||
|
Whirlpool Corp. |
63,084 | 11,668,017 | ||||||
|
|
|
|||||||
| 27,265,236 | ||||||||
| Household Products — 3.6% | ||||||||
|
Church & Dwight Co. Inc. |
91,996 | 8,131,526 | ||||||
|
Clorox Co. (The) |
92,431 | 19,156,325 | ||||||
|
Colgate-Palmolive Co. |
710,574 | 56,057,183 | ||||||
|
Energizer Holdings Inc. |
64,268 | 2,528,946 | ||||||
|
Kimberly-Clark Corp. |
351,216 | 46,567,729 | ||||||
|
Procter & Gamble Co. (The) |
2,070,980 | 283,931,358 | ||||||
|
WD-40 Co. |
6,834 | 1,663,259 | ||||||
|
|
|
|||||||
| 418,036,326 | ||||||||
| Independent Power and Renewable Electricity Producers — 0.1% | ||||||||
|
AES Corp. (The) |
790,468 | 15,414,126 | ||||||
|
Ormat Technologies Inc. |
13,410 | 950,367 | ||||||
|
|
|
|||||||
| 16,364,493 | ||||||||
| Industrial Conglomerates — 1.9% | ||||||||
|
3M Co. |
745,826 | 119,302,327 | ||||||
|
Carlisle Companies Inc. |
34,052 | 4,218,021 | ||||||
|
Honeywell International Inc. |
557,005 | 91,877,975 | ||||||
|
Roper Technologies Inc. |
19,582 | 7,271,580 | ||||||
|
|
|
|||||||
| 222,669,903 | ||||||||
| Insurance — 3.4% | ||||||||
|
Aflac Inc. |
793,320 | 26,933,214 | ||||||
|
Allstate Corp. (The) |
268,195 | 23,802,306 | ||||||
|
American Equity Investment Life Holding Co. |
42,261 | 1,048,918 | ||||||
|
American Financial Group Inc./OH |
72,616 | 5,441,843 | ||||||
|
Aon PLC, Class A |
72,618 | 13,362,438 | ||||||
|
Arthur J Gallagher & Co. |
121,195 | 12,569,134 | ||||||
|
Assurant Inc. |
45,159 | 5,616,425 | ||||||
|
Assured Guaranty Ltd. |
121,901 | 3,112,133 | ||||||
|
Axis Capital Holdings Ltd. |
108,256 | 4,621,449 | ||||||
|
Brown & Brown Inc. |
64,173 | 2,792,167 | ||||||
|
Chubb Ltd. |
421,017 | 54,694,319 | ||||||
|
Cincinnati Financial Corp. |
166,891 | 11,805,869 | ||||||
|
CNO Financial Group Inc. |
148,897 | 2,642,922 | ||||||
|
Erie Indemnity Co., Class A, NVS |
11,856 | 2,760,907 | ||||||
|
Everest Re Group Ltd. |
42,540 | 8,383,783 | ||||||
|
Fidelity National Financial Inc. |
406,322 | 12,713,815 | ||||||
|
First American Financial Corp. |
136,095 | 6,068,476 | ||||||
|
Globe Life Inc. |
32,926 | 2,669,969 | ||||||
|
Hanover Insurance Group Inc. (The) |
36,882 | 3,528,132 | ||||||
|
Hartford Financial Services Group Inc. (The) |
428,916 | 16,521,844 | ||||||
|
Lincoln National Corp. |
316,991 | 11,126,384 | ||||||
|
Marsh & McLennan Companies Inc. |
297,018 | 30,729,482 | ||||||
|
MetLife Inc. |
1,354,943 | 51,284,593 | ||||||
|
Old Republic International Corp. |
561,548 | 9,142,002 | ||||||
|
Primerica Inc. |
19,835 | 2,186,610 | ||||||
|
Principal Financial Group Inc. |
496,351 | 19,466,886 | ||||||
|
Reinsurance Group of America Inc. |
68,058 | 6,875,219 | ||||||
|
RenaissanceRe Holdings Ltd. |
14,363 | 2,322,784 | ||||||
|
RLI Corp. |
16,020 | 1,388,934 | ||||||
|
Selective Insurance Group Inc. |
34,698 | 1,806,378 | ||||||
|
Travelers Companies Inc. (The) |
276,434 | 33,368,348 | ||||||
|
Unum Group |
455,395 | 8,042,276 | ||||||
|
WR Berkley Corp. |
39,170 | 2,354,901 | ||||||
|
|
|
|||||||
| 401,184,860 | ||||||||
| 12 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core Dividend Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| IT Services — 2.6% | ||||||||
|
Accenture PLC, Class A |
311,774 | $ | 67,626,898 | |||||
|
Automatic Data Processing Inc. |
416,521 | 65,793,657 | ||||||
|
Booz Allen Hamilton Holding Corp. |
72,381 | 5,681,909 | ||||||
|
Broadridge Financial Solutions Inc. |
66,658 | 9,172,141 | ||||||
|
CSG Systems International Inc. |
29,237 | 1,107,498 | ||||||
|
Fidelity National Information Services Inc. |
212,899 | 26,525,086 | ||||||
|
Jack Henry & Associates Inc. |
30,053 | 4,455,357 | ||||||
|
Mastercard Inc., Class A |
151,894 | 43,842,684 | ||||||
|
TTEC Holdings Inc. |
8,622 | 472,313 | ||||||
|
Visa Inc., Class A |
362,522 | 65,873,873 | ||||||
|
Western Union Co. (The) |
592,178 | 11,511,940 | ||||||
|
|
|
|||||||
| 302,063,356 | ||||||||
| Leisure Products — 0.2% | ||||||||
|
Brunswick Corp./DE |
45,692 | 2,911,037 | ||||||
|
Hasbro Inc. |
161,995 | 13,400,226 | ||||||
|
Polaris Inc. |
55,688 | 5,059,812 | ||||||
|
|
|
|||||||
| 21,371,075 | ||||||||
| Machinery — 2.4% | ||||||||
|
AGCO Corp. |
19,428 | 1,496,539 | ||||||
|
Barnes Group Inc. |
30,893 | 1,133,773 | ||||||
|
Caterpillar Inc. |
533,633 | 83,807,063 | ||||||
|
Cummins Inc. |
133,338 | 29,319,693 | ||||||
|
Donaldson Co. Inc. |
81,761 | 3,883,647 | ||||||
|
Dover Corp. |
93,757 | 10,379,837 | ||||||
|
Franklin Electric Co. Inc. |
14,099 | 842,133 | ||||||
|
Graco Inc. |
72,303 | 4,475,556 | ||||||
|
Hillenbrand Inc. |
77,914 | 2,278,985 | ||||||
|
IDEX Corp. |
30,746 | 5,238,811 | ||||||
|
Illinois Tool Works Inc. |
230,409 | 45,132,515 | ||||||
|
ITT Inc. |
33,626 | 2,034,709 | ||||||
|
Lincoln Electric Holdings Inc. |
45,400 | 4,622,628 | ||||||
|
Mueller Water Products Inc., Class A |
119,137 | 1,234,259 | ||||||
|
Nordson Corp. |
15,519 | 3,001,840 | ||||||
|
Oshkosh Corp. |
39,191 | 2,639,906 | ||||||
|
Otis Worldwide Corp. |
190,675 | 11,684,564 | ||||||
|
PACCAR Inc. |
189,587 | 16,186,938 | ||||||
|
Pentair PLC |
102,921 | 5,121,349 | ||||||
|
Snap-on Inc. |
56,770 | 8,942,978 | ||||||
|
Stanley Black & Decker Inc. |
99,687 | 16,567,979 | ||||||
|
Timken Co. (The) |
49,642 | 2,963,627 | ||||||
|
Toro Co. (The) |
48,193 | 3,956,645 | ||||||
|
Trinity Industries Inc. |
129,302 | 2,436,050 | ||||||
|
Watts Water Technologies Inc., Class A |
9,250 | 1,024,623 | ||||||
|
Woodward Inc. |
7,934 | 631,150 | ||||||
|
Xylem Inc./NY |
82,293 | 7,171,012 | ||||||
|
|
|
|||||||
| 278,208,809 | ||||||||
| Media — 1.6% | ||||||||
|
Cable One Inc. |
1,034 | 1,790,743 | ||||||
|
Comcast Corp., Class A |
3,433,057 | 145,012,328 | ||||||
|
Interpublic Group of Companies Inc. (The) |
846,526 | 15,313,655 | ||||||
|
John Wiley & Sons Inc., Class A |
66,383 | 2,055,218 | ||||||
|
Nexstar Media Group Inc., Class A |
38,206 | 3,148,174 | ||||||
|
Omnicom Group Inc. |
382,734 | 18,065,045 | ||||||
|
|
|
|||||||
| 185,385,163 | ||||||||
| Metals & Mining — 0.3% | ||||||||
|
Nucor Corp. |
383,233 | 18,303,208 | ||||||
|
Reliance Steel & Aluminum Co. |
55,104 | 6,005,785 | ||||||
|
Royal Gold Inc. |
20,647 | 2,453,070 | ||||||
|
Steel Dynamics Inc. |
263,215 | 8,286,008 | ||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Metals & Mining (continued) | ||||||||
|
Worthington Industries Inc. |
30,437 | $ | 1,497,805 | |||||
|
|
|
|||||||
| 36,545,876 | ||||||||
| Multi-Utilities — 2.1% | ||||||||
|
Ameren Corp. |
227,083 | 18,420,973 | ||||||
|
Black Hills Corp. |
89,747 | 5,085,065 | ||||||
|
CMS Energy Corp. |
275,303 | 17,434,939 | ||||||
|
Consolidated Edison Inc. |
512,366 | 40,215,607 | ||||||
|
DTE Energy Co. |
238,248 | 29,404,568 | ||||||
|
MDU Resources Group Inc. |
254,053 | 6,036,299 | ||||||
|
NiSource Inc. |
532,855 | 12,239,679 | ||||||
|
NorthWestern Corp. |
86,172 | 4,492,147 | ||||||
|
Public Service Enterprise Group Inc. |
677,745 | 39,410,872 | ||||||
|
Sempra Energy |
369,413 | 46,309,614 | ||||||
|
WEC Energy Group Inc. |
298,393 | 30,003,416 | ||||||
|
|
|
|||||||
| 249,053,179 | ||||||||
| Multiline Retail — 0.6% | ||||||||
|
Dollar General Corp. |
66,818 | 13,945,585 | ||||||
|
Target Corp. |
336,327 | 51,195,696 | ||||||
|
|
|
|||||||
| 65,141,281 | ||||||||
| Oil, Gas & Consumable Fuels — 3.9% | ||||||||
|
Chevron Corp. |
4,398,488 | 305,694,916 | ||||||
|
Marathon Petroleum Corp. |
1,735,104 | 51,185,568 | ||||||
|
Phillips 66 |
992,600 | 46,314,716 | ||||||
|
Valero Energy Corp. |
1,222,980 | 47,219,258 | ||||||
|
|
|
|||||||
| 450,414,458 | ||||||||
| Personal Products — 0.0% | ||||||||
|
Nu Skin Enterprises Inc., Class A |
57,434 | 2,834,368 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 9.2% | ||||||||
|
Bristol-Myers Squibb Co. |
2,518,977 | 147,234,206 | ||||||
|
Eli Lilly & Co. |
599,395 | 78,197,072 | ||||||
|
Johnson & Johnson |
2,363,928 | 324,118,168 | ||||||
|
Merck & Co. Inc. |
2,651,296 | 199,403,972 | ||||||
|
Perrigo Co. PLC |
92,157 | 4,042,928 | ||||||
|
Pfizer Inc. |
8,527,332 | 302,549,739 | ||||||
|
Zoetis Inc. |
87,617 | 13,891,675 | ||||||
|
|
|
|||||||
| 1,069,437,760 | ||||||||
| Professional Services — 0.1% | ||||||||
|
Exponent Inc. |
19,176 | 1,334,458 | ||||||
|
Insperity Inc. |
33,984 | 2,602,495 | ||||||
|
ManpowerGroup Inc. |
65,173 | 4,423,291 | ||||||
|
Robert Half International Inc. |
108,993 | 5,524,855 | ||||||
|
|
|
|||||||
| 13,885,099 | ||||||||
| Real Estate Management & Development — 0.0% | ||||||||
|
Jones Lang LaSalle Inc. |
15,815 | 1,784,881 | ||||||
|
|
|
|||||||
| Road & Rail — 1.1% | ||||||||
|
CSX Corp. |
379,596 | 29,965,308 | ||||||
|
JB Hunt Transport Services Inc. |
24,193 | 2,945,256 | ||||||
|
Landstar System Inc. |
8,655 | 1,079,278 | ||||||
|
Union Pacific Corp. |
498,827 | 88,387,156 | ||||||
|
Werner Enterprises Inc. |
16,288 | 619,270 | ||||||
|
|
|
|||||||
| 122,996,268 | ||||||||
| Semiconductors & Semiconductor Equipment — 6.4% | ||||||||
|
Analog Devices Inc. |
289,159 | 34,274,016 | ||||||
|
Broadcom Inc. |
527,478 | 184,422,133 | ||||||
|
Intel Corp. |
4,115,618 | 182,239,565 | ||||||
|
KLA Corp. |
117,047 | 23,079,327 | ||||||
|
Lam Research Corp. |
81,085 | 27,737,557 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
13 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core Dividend Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Semiconductors & Semiconductor Equipment (continued) | ||||||||
|
Microchip Technology Inc. |
129,356 | $ | 13,592,728 | |||||
|
MKS Instruments Inc. |
14,884 | 1,613,277 | ||||||
|
NVIDIA Corp. |
28,191 | 14,133,840 | ||||||
|
Power Integrations Inc. |
17,968 | 1,081,853 | ||||||
|
QUALCOMM Inc. |
937,312 | 115,626,808 | ||||||
|
Skyworks Solutions Inc. |
88,881 | 12,557,997 | ||||||
|
Texas Instruments Inc. |
864,312 | 124,970,872 | ||||||
|
Xilinx Inc. |
134,724 | 15,990,392 | ||||||
|
|
|
|||||||
| 751,320,365 | ||||||||
| Software — 3.8% | ||||||||
|
Intuit Inc. |
61,661 | 19,403,483 | ||||||
|
Microsoft Corp. |
1,717,121 | 347,665,489 | ||||||
|
Oracle Corp. |
1,282,014 | 71,933,806 | ||||||
|
|
|
|||||||
| 439,002,778 | ||||||||
| Specialty Retail — 2.8% | ||||||||
|
Best Buy Co. Inc. |
167,278 | 18,659,861 | ||||||
|
Home Depot Inc. (The) |
851,129 | 227,004,616 | ||||||
|
Lithia Motors Inc., Class A |
4,111 | 943,762 | ||||||
|
Lowe’s Companies Inc. |
380,474 | 60,152,939 | ||||||
|
Monro Inc. |
23,293 | 979,704 | ||||||
|
Tiffany & Co. |
81,555 | 10,670,656 | ||||||
|
Tractor Supply Co. |
47,454 | 6,321,347 | ||||||
|
Williams-Sonoma Inc. |
61,143 | 5,576,853 | ||||||
|
|
|
|||||||
| 330,309,738 | ||||||||
| Technology Hardware, Storage & Peripherals — 3.0% | ||||||||
|
Apple Inc. |
3,059,262 | 333,031,261 | ||||||
|
NetApp Inc. |
331,441 | 14,546,946 | ||||||
|
Xerox Holdings Corp. |
353,180 | 6,138,268 | ||||||
|
|
|
|||||||
| 353,716,475 | ||||||||
| Textiles, Apparel & Luxury Goods — 0.6% | ||||||||
|
Nike Inc., Class B |
386,457 | 46,405,757 | ||||||
|
VF Corp. |
329,516 | 22,143,475 | ||||||
|
|
|
|||||||
| 68,549,232 | ||||||||
| Thrifts & Mortgage Finance — 0.0% | ||||||||
|
Washington Federal Inc. |
107,487 | 2,288,398 | ||||||
|
WSFS Financial Corp. |
31,804 | 1,007,869 | ||||||
|
|
|
|||||||
| 3,296,267 | ||||||||
| Security | Shares | Value | ||||||
|
|
||||||||
| Trading Companies & Distributors — 0.4% | ||||||||
|
Air Lease Corp. |
74,192 | $ | 2,020,990 | |||||
|
Applied Industrial Technologies Inc. |
30,509 | 1,862,574 | ||||||
|
Fastenal Co. |
461,095 | 19,933,137 | ||||||
|
GATX Corp. |
38,446 | 2,625,093 | ||||||
|
MSC Industrial Direct Co. Inc., Class A |
77,402 | 5,391,823 | ||||||
|
WW Grainger Inc. |
26,835 | 9,392,787 | ||||||
|
|
|
|||||||
| 41,226,404 | ||||||||
| Water Utilities — 0.2% | ||||||||
|
American States Water Co. |
23,950 | 1,788,825 | ||||||
|
American Water Works Co. Inc. |
101,141 | 15,222,732 | ||||||
|
California Water Service Group |
33,839 | 1,508,204 | ||||||
|
Essential Utilities Inc. |
205,175 | 8,453,210 | ||||||
|
SJW Group |
19,885 | 1,206,821 | ||||||
|
|
|
|||||||
| 28,179,792 | ||||||||
| Wireless Telecommunication Services — 0.0% | ||||||||
|
Shenandoah Telecommunications Co. |
10,380 | 452,776 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
11,654,533,035 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.3% | ||||||||
|
BlackRock Cash Funds: Treasury,
|
30,350,000 | 30,350,000 | ||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.3%
|
|
30,350,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.1%
|
|
11,684,883,035 | ||||||
|
Other Assets, Less Liabilities — (0.1)% |
|
(6,439,301 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 11,678,443,734 | |||||
|
|
|
|||||||
| (a) |
Affiliate of the Fund. |
| (b) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of
Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
$ | 23,342,000 | $ | 7,008,000 | (a) | $ | — | $ | — | $ | — | $ | 30,350,000 | 30,350,000 | $ | 16,074 | $ | — | ||||||||||||||||||
|
BlackRock Inc. |
46,150,027 | 32,827,239 | (2,629,227 | ) | 408,210 | 10,790,729 | 87,546,978 | 146,104 | 849,522 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 408,210 | $ | 10,790,729 | $ | 117,896,978 | $ | 865,596 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| 14 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core Dividend Growth ETF |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
(000) |
Value/
(Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
127 | 12/18/20 | $ | 20,731 | $ | (311,901 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 311,901 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 8,910,802 | ||
|
|
|
|||
| Net Change in Unrealized Appreciation (Depreciation) on: | ||||
|
Futures contracts |
$ | (3,706,324 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 33,592,392 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 11,654,533,035 | $ | — | $ | — | $ | 11,654,533,035 | ||||||||
|
Money Market Funds |
30,350,000 | — | — | 30,350,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 11,684,883,035 | $ | — | $ | — | $ | 11,684,883,035 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (311,901 | ) | $ | — | $ | — | $ | (311,901 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
15 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Core High Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Energy Equipment & Services — 0.4% | ||||||||
|
Schlumberger Ltd. |
1,268,212 | $ | 18,947,087 | |||||
|
|
|
|||||||
| Food Products — 1.1% | ||||||||
|
General Mills Inc. |
673,689 | 39,828,494 | ||||||
|
Kellogg Co. |
291,579 | 18,337,403 | ||||||
|
|
|
|||||||
| 58,165,897 | ||||||||
| Gas Utilities — 0.1% | ||||||||
|
National Fuel Gas Co. |
126,685 | 5,062,333 | ||||||
|
|
|
|||||||
| Household Products — 0.8% | ||||||||
|
Kimberly-Clark Corp. |
327,333 | 43,401,082 | ||||||
|
|
|
|||||||
| Industrial Conglomerates — 2.2% | ||||||||
|
3M Co. |
694,238 | 111,050,311 | ||||||
|
|
|
|||||||
| Insurance — 1.7% | ||||||||
|
Aflac Inc. |
737,924 | 25,052,520 | ||||||
|
Axis Capital Holdings Ltd. |
100,571 | 4,293,376 | ||||||
|
Cincinnati Financial Corp. |
155,808 | 11,021,858 | ||||||
|
Everest Re Group Ltd. |
39,468 | 7,778,353 | ||||||
|
First American Financial Corp. |
126,439 | 5,637,915 | ||||||
|
Mercury General Corp. |
52,078 | 2,120,095 | ||||||
|
Travelers Companies Inc. (The) |
257,314 | 31,060,373 | ||||||
|
|
|
|||||||
| 86,964,490 | ||||||||
| IT Services — 0.6% | ||||||||
|
Paychex Inc. |
355,365 | 29,228,771 | ||||||
|
|
|
|||||||
| Machinery — 0.7% | ||||||||
|
Cummins Inc. |
124,078 | 27,283,511 | ||||||
|
Snap-on Inc. |
53,086 | 8,362,638 | ||||||
|
|
|
|||||||
| 35,646,149 | ||||||||
| Metals & Mining — 0.1% | ||||||||
|
Southern Copper Corp. |
98,752 | 5,168,680 | ||||||
|
|
|
|||||||
| Multi-Utilities — 4.3% | ||||||||
|
CMS Energy Corp. |
257,269 | 16,292,846 | ||||||
|
Dominion Energy Inc. |
1,347,676 | 108,272,290 | ||||||
|
DTE Energy Co. |
221,640 | 27,354,809 | ||||||
|
Public Service Enterprise Group Inc. |
630,865 | 36,684,800 | ||||||
|
WEC Energy Group Inc. |
277,628 | 27,915,495 | ||||||
|
|
|
|||||||
| 216,520,240 | ||||||||
| Oil, Gas & Consumable Fuels — 17.6% | ||||||||
|
Chevron Corp. |
4,094,233 | 284,549,194 | ||||||
|
ConocoPhillips |
1,778,270 | 50,894,087 | ||||||
|
EOG Resources Inc. |
709,392 | 24,289,582 | ||||||
|
Exxon Mobil Corp. |
13,187,434 | 430,174,097 | ||||||
|
Phillips 66 |
923,941 | 43,111,087 | ||||||
|
Williams Companies Inc. (The) |
3,140,908 | 60,274,025 | ||||||
|
|
|
|||||||
| 893,292,072 | ||||||||
| Pharmaceuticals — 15.7% | ||||||||
|
Johnson & Johnson |
2,418,298 | 331,572,839 | ||||||
|
Merck & Co. Inc. |
2,467,900 | 185,610,759 | ||||||
|
Pfizer Inc. |
7,937,474 | 281,621,577 | ||||||
|
|
|
|||||||
| 798,805,175 | ||||||||
| Semiconductors & Semiconductor Equipment — 2.6% | ||||||||
|
Maxim Integrated Products Inc. |
260,031 | 18,111,159 | ||||||
|
Texas Instruments Inc. |
804,528 | 116,326,704 | ||||||
|
|
|
|||||||
| 134,437,863 | ||||||||
| Textiles, Apparel & Luxury Goods — 0.4% | ||||||||
|
VF Corp. |
306,219 | 20,577,917 | ||||||
|
|
|
|||||||
| 16 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core High Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
|
||||||||
| Thrifts & Mortgage Finance — 0.1% | ||||||||
|
Capitol Federal Financial Inc. |
174,226 | $ | 2,000,115 | |||||
|
TFS Financial Corp. |
130,641 | 2,052,370 | ||||||
|
|
|
|||||||
| 4,052,485 | ||||||||
| Tobacco — 3.4% | ||||||||
|
Altria Group Inc. |
4,849,895 | 174,984,212 | ||||||
|
|
|
|||||||
| Trading Companies & Distributors — 0.2% | ||||||||
|
MSC Industrial Direct Co. Inc., Class A |
71,917 | 5,009,738 | ||||||
|
Watsco Inc. |
33,400 | 7,486,276 | ||||||
|
|
|
|||||||
| 12,496,014 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
|
5,068,979,831 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.2% | ||||||||
|
BlackRock Cash Funds: Treasury,
|
7,900,000 | 7,900,000 | ||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.2%
|
|
7,900,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.0%
|
|
5,076,879,831 | ||||||
|
Other Assets, Less Liabilities — 0.0% |
|
801,553 | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 5,077,681,384 | |||||
|
|
|
|||||||
| (a) |
Affiliate of the Fund. |
| (b) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of
Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
(Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
$ | 20,280,000 | $ | — | $ | (12,380,000 | )(a) | $ | — | $ | — | $ | 7,900,000 | 7,900,000 | $ | 7,090 | $ | — | ||||||||||||||||||
|
BlackRock Inc. |
70,357,894 | 15,297,206 | (17,295,102 | ) | 1,815,506 | 11,317,056 | 81,492,560 | 136,000 | 1,023,148 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 1,815,506 | $ | 11,317,056 | $ | 89,392,560 | $ | 1,030,238 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
48 | 12/18/20 | $ | 7,835 | $ | (37,802 | ) | |||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
17 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core High Dividend ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 37,802 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 6,394,266 | ||
|
|
|
|||
| Net Change in Unrealized Appreciation (Depreciation) on: | ||||
|
Futures contracts |
$ | (1,560,635 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 10,131,660 | ||
|
|
||||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 5,068,979,831 | $ | — | $ | — | $ | 5,068,979,831 | ||||||||
|
Money Market Funds |
7,900,000 | — | — | 7,900,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 5,076,879,831 | $ | — | $ | — | $ | 5,076,879,831 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (37,802 | ) | $ | — | $ | — | $ | (37,802 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 18 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® International Select Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Australia — 7.9% | ||||||||
|
APA Group |
3,192,862 | $ | 23,520,550 | |||||
|
AusNet Services |
4,938,221 | 6,935,733 | ||||||
|
Bendigo & Adelaide Bank Ltd. |
3,286,653 | 15,440,872 | ||||||
|
Commonwealth Bank of Australia |
2,351,964 | 113,998,061 | ||||||
|
Fortescue Metals Group Ltd. |
5,066,783 | 61,805,050 | ||||||
|
Perpetual Ltd. |
481,825 | 9,203,438 | ||||||
|
Suncorp Group Ltd. |
2,578,691 | 14,867,375 | ||||||
|
|
|
|||||||
| 245,771,079 | ||||||||
| Austria — 0.4% | ||||||||
|
Oesterreichische Post AG(a) |
358,372 | 11,375,497 | ||||||
|
|
|
|||||||
| Belgium — 2.5% | ||||||||
|
Ageas SA/NV |
1,102,865 | 44,385,409 | ||||||
|
Proximus SADP |
1,659,166 | 32,266,070 | ||||||
|
|
|
|||||||
| 76,651,479 | ||||||||
| Canada — 8.0% | ||||||||
|
Bank of Montreal |
737,376 | 43,871,480 | ||||||
|
Bank of Nova Scotia (The) |
815,192 | 33,840,235 | ||||||
|
Canadian Imperial Bank of Commerce |
786,597 | 58,628,275 | ||||||
|
Emera Inc. |
1,185,150 | 47,242,451 | ||||||
|
Great-West Lifeco Inc. |
923,859 | 18,811,844 | ||||||
|
IGM Financial Inc. |
840,571 | 18,439,796 | ||||||
|
Manulife Financial Corp. |
708,019 | 9,589,997 | ||||||
|
Power Corp. of Canada |
915,718 | 17,423,606 | ||||||
|
|
|
|||||||
| 247,847,684 | ||||||||
| China — 0.0% | ||||||||
|
Gemdale Properties & Investment Corp. Ltd. |
9,256,000 | 1,432,291 | ||||||
|
|
|
|||||||
| Finland — 5.0% | ||||||||
|
Fortum OYJ |
2,490,440 | 46,850,953 | ||||||
|
Sampo OYJ, Class A |
911,628 | 34,405,865 | ||||||
|
UPM-Kymmene OYJ |
1,890,054 | 53,411,506 | ||||||
|
Wartsila OYJ Abp |
2,356,202 | 18,723,803 | ||||||
|
|
|
|||||||
| 153,392,127 | ||||||||
| France — 2.9% | ||||||||
|
Nexity SA |
513,260 | 14,408,683 | ||||||
|
Orange SA |
1,251,337 | 14,036,874 | ||||||
|
TOTAL SE |
1,994,227 | 59,979,197 | ||||||
|
|
|
|||||||
| 88,424,754 | ||||||||
| Hong Kong — 11.3% | ||||||||
|
BOC Hong Kong Holdings Ltd. |
6,653,000 | 18,445,167 | ||||||
|
CK Hutchison Holdings Ltd. |
11,364,500 | 68,437,449 | ||||||
|
CK Infrastructure Holdings Ltd. |
8,195,500 | 38,574,021 | ||||||
|
Hang Seng Bank Ltd. |
5,801,100 | 89,168,858 | ||||||
|
Henderson Land Development Co. Ltd. |
11,890,000 | 42,087,274 | ||||||
|
Hysan Development Co. Ltd. |
6,112,000 | 19,427,945 | ||||||
|
Kerry Properties Ltd. |
6,058,000 | 14,811,335 | ||||||
|
New World Development Co. Ltd. |
2,683,750 | 12,770,121 | ||||||
|
PCCW Ltd. |
15,833,000 | 9,514,276 | ||||||
|
Swire Pacific Ltd., Class A |
4,954,000 | 22,550,559 | ||||||
|
VTech Holdings Ltd. |
1,931,100 | 12,811,994 | ||||||
|
|
|
|||||||
| 348,598,999 | ||||||||
| Italy — 7.3% | ||||||||
|
A2A SpA |
4,850,566 | 6,167,171 | ||||||
|
Assicurazioni Generali SpA |
2,975,861 | 39,898,612 | ||||||
|
Azimut Holding SpA |
1,148,557 | 19,392,803 | ||||||
|
Banca Generali SpA(b) |
616,521 | 17,522,962 | ||||||
| Security | Shares | Value | ||||||
| Italy (continued) | ||||||||
|
Enel SpA |
3,902,241 | $ | 31,064,107 | |||||
|
Eni SpA |
8,015,806 | 56,125,955 | ||||||
|
Italgas SpA |
4,378,471 | 25,307,489 | ||||||
|
Snam SpA |
4,532,324 | 22,121,002 | ||||||
|
UnipolSai Assicurazioni SpA |
3,154,246 | 7,326,398 | ||||||
|
|
|
|||||||
| 224,926,499 | ||||||||
| Japan — 3.4% | ||||||||
|
Idemitsu Kosan Co. Ltd. |
2,889,000 | 58,172,422 | ||||||
|
Sojitz Corp. |
3,082,200 | 6,751,710 | ||||||
|
Sumitomo Mitsui Financial Group Inc. |
1,425,100 | 39,274,088 | ||||||
|
|
|
|||||||
| 104,198,220 | ||||||||
| New Zealand — 2.0% | ||||||||
|
Spark New Zealand Ltd. |
20,386,768 | 60,496,540 | ||||||
|
|
|
|||||||
| Portugal — 1.3% | ||||||||
|
EDP - Energias de Portugal SA |
8,205,910 | 40,452,208 | ||||||
|
|
|
|||||||
| Singapore — 1.7% | ||||||||
|
BOC Aviation Ltd.(c) |
1,974,200 | 12,181,470 | ||||||
|
ComfortDelGro Corp. Ltd. |
3,856,700 | 3,812,922 | ||||||
|
DBS Group Holdings Ltd. |
1,768,200 | 26,351,424 | ||||||
|
Oversea-Chinese Banking Corp. Ltd. |
1,765,200 | 10,884,646 | ||||||
|
|
|
|||||||
| 53,230,462 | ||||||||
| South Korea — 2.8% | ||||||||
|
KB Financial Group Inc., ADR |
1,206,913 | 43,123,002 | ||||||
|
Shinhan Financial Group Co. Ltd., ADR |
1,145,344 | 30,821,207 | ||||||
|
Woori Financial Group Inc., SP ADR NVS(b) |
504,865 | 12,081,419 | ||||||
|
|
|
|||||||
| 86,025,628 | ||||||||
| Spain — 10.4% | ||||||||
|
ACS Actividades de Construccion y
|
3,143,225 | 74,692,235 | ||||||
|
Bankia SA |
8,661,637 | 10,614,158 | ||||||
|
Bankinter SA |
3,677,826 | 13,781,994 | ||||||
|
Cia. de Distribucion Integral Logista
|
1,044,885 | 17,624,097 | ||||||
|
Enagas SA |
2,488,715 | 53,718,070 | ||||||
|
Mapfre SA |
6,273,690 | 9,456,429 | ||||||
|
Naturgy Energy Group SA |
4,012,327 | 74,546,426 | ||||||
|
Red Electrica Corp. SA |
2,504,113 | 44,118,336 | ||||||
|
Telefonica SA |
7,417,605 | 24,244,944 | ||||||
|
|
|
|||||||
| 322,796,689 | ||||||||
| Sweden — 1.6% | ||||||||
|
Telia Co. AB |
12,928,559 | 49,557,915 | ||||||
|
|
|
|||||||
| Switzerland — 4.5% | ||||||||
|
Swiss Prime Site AG, Registered |
152,900 | 12,861,917 | ||||||
|
Swiss Re AG |
134,216 | 9,626,709 | ||||||
|
Swisscom AG, Registered |
161,019 | 81,919,327 | ||||||
|
Zurich Insurance Group AG |
108,439 | 35,966,893 | ||||||
|
|
|
|||||||
| 140,374,846 | ||||||||
| United Kingdom — 23.4% | ||||||||
|
BP PLC |
6,162,848 | 15,666,198 | ||||||
|
British American Tobacco PLC |
4,245,806 | 134,391,005 | ||||||
|
Centamin PLC |
3,242,003 | 5,195,874 | ||||||
|
Drax Group PLC |
4,424,987 | 16,924,226 | ||||||
|
GlaxoSmithKline PLC |
3,028,537 | 50,585,588 | ||||||
|
IG Group Holdings PLC |
1,752,113 | 17,240,323 | ||||||
|
Legal & General Group PLC |
2,781,054 | 6,645,230 | ||||||
|
National Grid PLC |
3,346,035 | 39,759,840 | ||||||
|
Phoenix Group Holdings PLC |
2,211,146 | 18,938,099 | ||||||
|
Rio Tinto PLC |
4,793,153 | 270,027,187 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
19 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Select Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| United Kingdom (continued) | ||||||||
|
Royal Dutch Shell PLC, Class A |
2,290,796 | $ | 28,595,148 | |||||
|
SSE PLC |
4,707,387 | 76,387,495 | ||||||
|
Standard Life Aberdeen PLC |
2,657,627 | 7,714,522 | ||||||
|
United Utilities Group PLC |
2,895,908 | 32,329,236 | ||||||
|
Vodafone Group PLC |
3,491,655 | 4,650,153 | ||||||
|
|
|
|||||||
| 725,050,124 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 96.4%
|
2,980,603,041 | |||||||
|
|
|
|||||||
|
Investment Companies |
||||||||
| Exchange Traded Funds — 2.0% | ||||||||
|
iShares MSCI South Korea ETF(d) |
954,949 | 61,976,190 | ||||||
|
|
|
|||||||
|
Total Investment Companies — 2.0%
|
61,976,190 | |||||||
|
|
|
|||||||
|
Preferred Stocks |
||||||||
| Germany — 0.4% | ||||||||
|
Schaeffler AG, Preference Shares, NVS |
1,907,165 | 11,607,652 | ||||||
|
|
|
|||||||
| South Korea — 0.4% | ||||||||
|
Hyundai Motor Co., Preference Shares, GDR(e) |
409,163 | 13,706,961 | ||||||
|
|
|
|||||||
|
Total Preferred Stocks — 0.8%
|
25,314,613 | |||||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.2% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(d)(f)(g) |
6,610,585 | $ | 6,615,212 | |||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(d)(f) |
1,260,000 | 1,260,000 | ||||||
|
|
|
|||||||
| 7,875,212 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.2%
|
7,875,212 | |||||||
|
|
|
|||||||
|
Total Investments in Securities — 99.4%
|
3,075,769,056 | |||||||
|
Other Assets, Less Liabilities — 0.6% |
|
17,111,320 | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 3,092,880,376 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (d) |
Affiliate of the Fund. |
| (e) |
This security may be resold to qualified foreign investors and foreign institutional buyers under Regulation S of the Securities Act of 1933. |
| (f) |
Annualized 7-day yield as of period-end. |
| (g) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital
Gain
|
|
||||||||||||||||||||||||||||||
|
Aareal Bank AG(a) |
$ | 48,909,055 | $ | 674,953 | $ | (60,089,453 | ) | $ | (51,750,660) | $ | 62,256,105 | $ | — | — | $ | — | $ | — | ||||||||||||||||||||||
|
Azimut Holding SpA(b) |
122,413,895 | 3,146,341 | (108,155,972 | ) | 1,730,852 | (472,030 | ) | N/A | N/A | 7,702,637 | — | |||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
— | 6,621,791 | (c) | — | (4,233) | (2,346 | ) | 6,615,212 | 6,610,585 | 187,673 | (d) | — | ||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,290,000 | — | (30,000 | )(c) | — | — | 1,260,000 | 1,260,000 | 1,492 | — | ||||||||||||||||||||||||||||||
|
Galliford Try Holding PLC(a) |
13,165,757 | 56,422 | (11,213,142 | ) | (63,983,704) | 61,974,667 | — | — | — | — | ||||||||||||||||||||||||||||||
|
iShares MSCI South Korea ETF |
— | 64,796,547 | (9,755,884 | ) | 987,161 | 5,948,366 | 61,976,190 | 954,949 | — | — | ||||||||||||||||||||||||||||||
|
Perpetual Ltd.(b) |
70,831,011 | 1,142,274 | (61,809,943 | ) | (30,686,221) | 34,586,789 | N/A | N/A | 195,945 | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| $ | (143,706,805) | $ | 164,291,551 | $ | 69,851,402 | $ | 8,087,747 | $ | — | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| (a) |
As of period end, the entity is no longer held. |
| (b) |
As of period end, the entity is no longer an affiliate. |
| (c) |
Represents net amount purchased (sold). |
| (d) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
| 20 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Select Dividend ETF |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount
|
Value/
(Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
ASX SPI 200 Index |
46 | 12/17/20 | $ | 4,757 | $ | (26,475 | ) | |||||||||
|
Euro STOXX 50 Index |
156 | 12/18/20 | 5,377 | (457,175 | ) | |||||||||||
|
FTSE 100 Index |
170 | 12/18/20 | 12,229 | (786,378 | ) | |||||||||||
|
|
|
|||||||||||||||
| (1,270,028 | ) | |||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 1,270,028 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 2,822,649 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (3,078,753 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 27,270,830 | ||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 2,980,603,041 | $ | — | $ | — | $ | 2,980,603,041 | ||||||||
|
Investment Companies |
61,976,190 | — | — | 61,976,190 | ||||||||||||
|
Preferred Stocks |
25,314,613 | — | — | 25,314,613 | ||||||||||||
|
Money Market Funds |
7,875,212 | — | — | 7,875,212 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 3,075,769,056 | $ | — | $ | — | $ | 3,075,769,056 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (1,270,028 | ) | $ | — | $ | — | $ | (1,270,028) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
21 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Select Dividend ETF |
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 22 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Select Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Electric Utilities (continued) | ||||||||
|
Exelon Corp. |
3,764,116 | $ | 150,150,587 | |||||
|
FirstEnergy Corp. |
3,293,913 | 97,895,094 | ||||||
|
IDACORP Inc. |
850,497 | 74,614,102 | ||||||
|
NextEra Energy Inc. |
1,286,829 | 94,208,751 | ||||||
|
OGE Energy Corp. |
3,203,156 | 98,561,110 | ||||||
|
Pinnacle West Capital Corp. |
1,874,212 | 152,879,473 | ||||||
|
PPL Corp. |
8,039,783 | 221,094,033 | ||||||
|
Xcel Energy Inc. |
1,489,833 | 104,333,005 | ||||||
|
|
|
|||||||
| 1,644,227,967 | ||||||||
| Electrical Equipment — 2.2% | ||||||||
|
Eaton Corp. PLC |
1,409,696 | 146,312,348 | ||||||
|
Emerson Electric Co. |
1,875,634 | 121,522,327 | ||||||
|
|
|
|||||||
| 267,834,675 | ||||||||
| Energy Equipment & Services — 0.2% | ||||||||
|
Helmerich & Payne Inc. |
1,477,554 | 21,971,228 | ||||||
|
|
|
|||||||
| Food Products — 0.9% | ||||||||
|
General Mills Inc. |
1,867,078 | 110,381,651 | ||||||
|
|
|
|||||||
| Gas Utilities — 0.4% | ||||||||
|
New Jersey Resources Corp. |
1,623,712 | 47,379,916 | ||||||
|
|
|
|||||||
| Hotels, Restaurants & Leisure — 0.9% | ||||||||
|
McDonald’s Corp. |
516,703 | 110,057,739 | ||||||
|
|
|
|||||||
| Household Durables — 2.2% | ||||||||
|
Garmin Ltd. |
983,363 | 102,289,419 | ||||||
|
Leggett & Platt Inc. |
1,871,002 | 78,076,914 | ||||||
|
Newell Brands Inc. |
5,260,094 | 92,893,260 | ||||||
|
|
|
|||||||
| 273,259,593 | ||||||||
| Household Products — 0.9% | ||||||||
|
Kimberly-Clark Corp. |
823,634 | 109,205,632 | ||||||
|
|
|
|||||||
| Insurance — 7.1% | ||||||||
|
Cincinnati Financial Corp. |
2,296,109 | 162,426,751 | ||||||
|
MetLife Inc. |
4,876,872 | 184,589,605 | ||||||
|
Old Republic International Corp. |
4,345,295 | 70,741,402 | ||||||
|
Principal Financial Group Inc. |
3,761,160 | 147,512,695 | ||||||
|
Prudential Financial Inc. |
4,008,756 | 256,640,559 | ||||||
|
Unum Group |
2,876,401 | 50,797,242 | ||||||
|
|
|
|||||||
| 872,708,254 | ||||||||
| IT Services — 2.3% | ||||||||
|
International Business Machines Corp. |
1,515,375 | 169,206,773 | ||||||
|
Western Union Co. (The) |
5,919,732 | 115,079,590 | ||||||
|
|
|
|||||||
| 284,286,363 | ||||||||
| Machinery — 1.2% | ||||||||
|
Caterpillar Inc. |
976,271 | 153,323,361 | ||||||
|
|
|
|||||||
| Media — 3.7% | ||||||||
|
Interpublic Group of Companies Inc. (The) |
5,945,115 | 107,547,130 | ||||||
|
Omnicom Group Inc. |
3,078,153 | 145,288,822 | ||||||
|
ViacomCBS Inc., Class B, NVS |
7,271,014 | 207,732,870 | ||||||
|
|
|
|||||||
| 460,568,822 | ||||||||
| Multi-Utilities — 9.9% | ||||||||
|
Avista Corp. |
1,130,439 | 37,553,184 | ||||||
|
Black Hills Corp. |
1,052,191 | 59,617,142 | ||||||
|
CenterPoint Energy Inc. |
6,918,015 | 146,177,657 | ||||||
|
CMS Energy Corp. |
1,751,279 | 110,908,499 | ||||||
|
Dominion Energy Inc. |
1,916,648 | 153,983,500 | ||||||
|
DTE Energy Co. |
1,256,782 | 155,112,034 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
23 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Select Dividend ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Multi-Utilities (continued) | ||||||||
|
NiSource Inc. |
5,444,165 | $ | 125,052,470 | |||||
|
NorthWestern Corp. |
836,262 | 43,594,338 | ||||||
|
Public Service Enterprise Group Inc. |
2,773,439 | 161,275,478 | ||||||
|
Sempra Energy |
970,457 | 121,656,489 | ||||||
|
WEC Energy Group Inc. |
1,109,601 | 111,570,381 | ||||||
|
|
|
|||||||
| 1,226,501,172 | ||||||||
| Multiline Retail — 0.8% | ||||||||
|
Target Corp. |
678,006 | 103,206,073 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 7.0% | ||||||||
|
Chevron Corp. |
2,174,018 | 151,094,251 | ||||||
|
Exxon Mobil Corp. |
5,696,638 | 185,824,332 | ||||||
|
HollyFrontier Corp. |
2,277,118 | 42,149,454 | ||||||
|
Marathon Petroleum Corp. |
6,351,184 | 187,359,928 | ||||||
|
ONEOK Inc. |
6,037,191 | 175,078,539 | ||||||
|
Valero Energy Corp. |
3,211,672 | 124,002,656 | ||||||
|
|
|
|||||||
| 865,509,160 | ||||||||
| Personal Products — 0.4% | ||||||||
|
Nu Skin Enterprises Inc., Class A |
897,584 | 44,295,770 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 2.0% | ||||||||
|
Merck & Co. Inc. |
1,393,665 | 104,817,545 | ||||||
|
Pfizer Inc. |
4,177,354 | 148,212,520 | ||||||
|
|
|
|||||||
| 253,030,065 | ||||||||
| Semiconductors & Semiconductor Equipment — 1.8% | ||||||||
|
Intel Corp. |
1,238,121 | 54,823,998 | ||||||
|
QUALCOMM Inc. |
1,331,640 | 164,271,110 | ||||||
|
|
|
|||||||
| 219,095,108 | ||||||||
| Technology Hardware, Storage & Peripherals — 2.8% | ||||||||
|
HP Inc. |
10,390,923 | 186,620,977 | ||||||
|
Seagate Technology PLC |
3,340,050 | 159,721,191 | ||||||
|
|
|
|||||||
| 346,342,168 | ||||||||
| Security | Shares | Value | ||||||
| Textiles, Apparel & Luxury Goods — 0.6% | ||||||||
|
Hanesbrands Inc. |
4,740,579 | $ | 76,181,105 | |||||
|
|
|
|||||||
| Thrifts & Mortgage Finance — 0.5% | ||||||||
|
New York Community Bancorp. Inc. |
7,252,221 | 60,265,956 | ||||||
|
|
|
|||||||
| Tobacco — 4.1% | ||||||||
|
Altria Group Inc. |
7,756,718 | 279,862,386 | ||||||
|
Philip Morris International Inc. |
3,200,804 | 227,321,100 | ||||||
|
|
|
|||||||
| 507,183,486 | ||||||||
| Trading Companies & Distributors — 1.0% | ||||||||
|
Watsco Inc. |
536,860 | 120,331,800 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
12,310,650,543 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 0.3% |
||||||||
|
BlackRock Cash Funds: Treasury,
|
36,700,000 | 36,700,000 | ||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.3%
|
|
36,700,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.1%
|
|
12,347,350,543 | ||||||
|
Other Assets, Less Liabilities — (0.1)% |
|
(10,682,701 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 12,336,667,842 | |||||
|
|
|
|||||||
| (a) |
Affiliate of the Fund. |
| (b) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change
in
(Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
$ | 51,930,000 | $ | — | $ | (15,230,000 | )(a) | $ | — | $ | — | $ | 36,700,000 | 36,700,000 | $ | 18,369 | $ | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration Date |
Notional
Amount
|
Value/
(Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
152 | 12/18/20 | $ | 24,812 | $ | (227,562 | ) | |||||||||
|
|
|
|||||||||||||||
| 24 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Select Dividend ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 227,562 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 10,803,875 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (2,052,135) | ||
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 28,835,157 | ||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 12,310,650,543 | $ | — | $ | — | $ | 12,310,650,543 | ||||||||
|
Money Market Funds |
36,700,000 | — | — | 36,700,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 12,347,350,543 | $ | — | $ | — | $ | 12,347,350,543 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (227,562 | ) | $ | — | $ | — | $ | (227,562 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
25 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Aerospace & Defense — 1.8% | ||||||||
|
Boeing Co. (The) |
1,249 | $ | 180,343 | |||||
|
General Dynamics Corp. |
418 | 54,896 | ||||||
|
Huntington Ingalls Industries Inc. |
120 | 17,698 | ||||||
|
L3Harris Technologies Inc. |
145 | 23,361 | ||||||
|
Lockheed Martin Corp. |
324 | 113,442 | ||||||
|
Northrop Grumman Corp. |
198 | 57,384 | ||||||
|
Raytheon Technologies Corp. |
2,127 | 115,539 | ||||||
|
Textron Inc. |
636 | 22,769 | ||||||
|
|
|
|||||||
| 585,432 | ||||||||
| Air Freight & Logistics — 0.7% | ||||||||
|
CH Robinson Worldwide Inc. |
193 | 17,067 | ||||||
|
Expeditors International of Washington Inc. |
191 | 16,879 | ||||||
|
FedEx Corp. |
141 | 36,585 | ||||||
|
United Parcel Service Inc., Class B |
721 | 113,276 | ||||||
|
XPO Logistics Inc.(a) |
382 | 34,380 | ||||||
|
|
|
|||||||
| 218,187 | ||||||||
| Airlines — 0.3% | ||||||||
|
American Airlines Group Inc. |
53 | 598 | ||||||
|
Delta Air Lines Inc. |
2,130 | 65,263 | ||||||
|
Southwest Airlines Co. |
699 | 27,632 | ||||||
|
United Airlines Holdings Inc.(a) |
457 | 15,474 | ||||||
|
|
|
|||||||
| 108,967 | ||||||||
| Auto Components — 0.1% | ||||||||
|
Aptiv PLC |
13 | 1,254 | ||||||
|
Gentex Corp. |
610 | 16,879 | ||||||
|
Lear Corp. |
146 | 17,638 | ||||||
|
|
|
|||||||
| 35,771 | ||||||||
| Automobiles — 0.4% | ||||||||
|
Ford Motor Co. |
9,199 | 71,108 | ||||||
|
General Motors Co. |
1,507 | 52,037 | ||||||
|
|
|
|||||||
| 123,145 | ||||||||
| Banks — 12.3% | ||||||||
|
Bank of America Corp. |
33,977 | 805,255 | ||||||
|
CIT Group Inc. |
1,227 | 36,135 | ||||||
|
Citigroup Inc. |
12,608 | 522,223 | ||||||
|
Citizens Financial Group Inc. |
2,147 | 58,506 | ||||||
|
Comerica Inc. |
1,392 | 63,350 | ||||||
|
Fifth Third Bancorp. |
3,263 | 75,767 | ||||||
|
Huntington Bancshares Inc./OH |
4,483 | 46,803 | ||||||
|
JPMorgan Chase & Co. |
10,412 | 1,020,792 | ||||||
|
KeyCorp |
4,229 | 54,892 | ||||||
|
M&T Bank Corp. |
638 | 66,084 | ||||||
|
PNC Financial Services Group Inc. (The) |
1,535 | 171,736 | ||||||
|
Regions Financial Corp. |
5,755 | 76,542 | ||||||
|
Synovus Financial Corp. |
925 | 24,050 | ||||||
|
Truist Financial Corp. |
2,400 | 101,088 | ||||||
|
U.S. Bancorp. |
5,276 | 205,500 | ||||||
|
Wells Fargo & Co. |
35,102 | 752,938 | ||||||
|
Zions Bancorp NA |
1,064 | 34,335 | ||||||
|
|
|
|||||||
| 4,115,996 | ||||||||
| Beverages — 1.5% | ||||||||
|
Coca-Cola Co. (The) |
4,011 | 192,769 | ||||||
|
Constellation Brands Inc., Class A |
98 | 16,193 | ||||||
|
Monster Beverage Corp.(a) |
243 | 18,606 | ||||||
|
PepsiCo Inc. |
1,946 | 259,382 | ||||||
|
|
|
|||||||
| 486,950 | ||||||||
| Security | Shares | Value | ||||||
| Biotechnology — 2.9% | ||||||||
|
AbbVie Inc. |
3,758 | $ | 319,806 | |||||
|
Amgen Inc. |
1,391 | 301,763 | ||||||
|
Biogen Inc.(a) |
753 | 189,809 | ||||||
|
Gilead Sciences Inc. |
2,739 | 159,273 | ||||||
|
|
|
|||||||
| 970,651 | ||||||||
| Building Products — 0.7% | ||||||||
|
Johnson Controls International PLC |
3,668 | 154,826 | ||||||
|
Masco Corp. |
629 | 33,714 | ||||||
|
Trane Technologies PLC |
310 | 41,153 | ||||||
|
|
|
|||||||
| 229,693 | ||||||||
| Capital Markets — 4.1% | ||||||||
|
Ameriprise Financial Inc. |
496 | 79,772 | ||||||
|
Apollo Global Management Inc. |
422 | 15,555 | ||||||
|
Bank of New York Mellon Corp. (The) |
3,576 | 122,871 | ||||||
|
BlackRock Inc.(b) |
269 | 161,187 | ||||||
|
Blackstone Group Inc. (The), Class A |
1,273 | 64,185 | ||||||
|
Charles Schwab Corp. (The) |
2,140 | 87,975 | ||||||
|
CME Group Inc. |
229 | 34,515 | ||||||
|
Franklin Resources Inc. |
1,071 | 20,081 | ||||||
|
Goldman Sachs Group Inc. (The) |
980 | 185,259 | ||||||
|
Intercontinental Exchange Inc. |
724 | 68,346 | ||||||
|
Invesco Ltd. |
1,937 | 25,394 | ||||||
|
LPL Financial Holdings Inc. |
217 | 17,345 | ||||||
|
Moody’s Corp. |
109 | 28,656 | ||||||
|
Morgan Stanley |
3,626 | 174,592 | ||||||
|
MSCI Inc. |
90 | 31,486 | ||||||
|
Northern Trust Corp. |
627 | 49,075 | ||||||
|
Raymond James Financial Inc. |
291 | 22,244 | ||||||
|
S&P Global Inc. |
199 | 64,223 | ||||||
|
State Street Corp. |
652 | 38,403 | ||||||
|
T Rowe Price Group Inc. |
503 | 63,710 | ||||||
|
|
|
|||||||
| 1,354,874 | ||||||||
| Chemicals — 1.9% | ||||||||
|
Air Products & Chemicals Inc. |
122 | 33,701 | ||||||
|
Celanese Corp. |
386 | 43,815 | ||||||
|
CF Industries Holdings Inc. |
753 | 20,790 | ||||||
|
Dow Inc. |
1,574 | 71,601 | ||||||
|
DuPont de Nemours Inc. |
1,895 | 107,788 | ||||||
|
Eastman Chemical Co. |
261 | 21,099 | ||||||
|
Ecolab Inc. |
134 | 24,601 | ||||||
|
Linde PLC |
587 | 129,340 | ||||||
|
LyondellBasell Industries NV, Class A |
1,407 | 96,309 | ||||||
|
PPG Industries Inc. |
253 | 32,819 | ||||||
|
Sherwin-Williams Co. (The) |
61 | 41,967 | ||||||
|
|
|
|||||||
| 623,830 | ||||||||
| Commercial Services & Supplies — 0.3% | ||||||||
|
Cintas Corp. |
89 | 27,995 | ||||||
|
Republic Services Inc. |
207 | 18,251 | ||||||
|
Waste Management Inc. |
394 | 42,517 | ||||||
|
|
|
|||||||
| 88,763 | ||||||||
| Communications Equipment — 1.9% | ||||||||
|
Cisco Systems Inc. |
16,855 | 605,095 | ||||||
|
Juniper Networks Inc. |
849 | 16,742 | ||||||
|
Motorola Solutions Inc. |
141 | 22,286 | ||||||
|
|
|
|||||||
| 644,123 | ||||||||
| Construction & Engineering — 0.1% | ||||||||
|
Jacobs Engineering Group Inc. |
220 | 20,900 | ||||||
|
|
|
|||||||
| 26 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Consumer Finance — 1.2% | ||||||||
|
Ally Financial Inc. |
1,567 | $ | 41,808 | |||||
|
American Express Co. |
1,303 | 118,886 | ||||||
|
Capital One Financial Corp. |
915 | 66,868 | ||||||
|
Discover Financial Services |
1,248 | 81,132 | ||||||
|
Synchrony Financial |
3,965 | 99,204 | ||||||
|
|
|
|||||||
| 407,898 | ||||||||
| Containers & Packaging — 0.3% | ||||||||
|
Ball Corp. |
402 | 35,778 | ||||||
|
International Paper Co. |
1,125 | 49,219 | ||||||
|
|
|
|||||||
| 84,997 | ||||||||
| Distributors — 0.0% | ||||||||
|
Genuine Parts Co. |
179 | 16,187 | ||||||
|
|
|
|||||||
| Diversified Financial Services — 0.7% | ||||||||
|
Berkshire Hathaway Inc., Class B(a) |
787 | 158,895 | ||||||
|
Equitable Holdings Inc. |
2,115 | 45,452 | ||||||
|
Voya Financial Inc. |
742 | 35,564 | ||||||
|
|
|
|||||||
| 239,911 | ||||||||
| Diversified Telecommunication Services — 2.7% | ||||||||
|
AT&T Inc. |
20,492 | 553,694 | ||||||
|
CenturyLink Inc. |
3,018 | 26,015 | ||||||
|
Verizon Communications Inc. |
5,669 | 323,076 | ||||||
|
|
|
|||||||
| 902,785 | ||||||||
| Electric Utilities — 1.3% | ||||||||
|
American Electric Power Co. Inc. |
540 | 48,562 | ||||||
|
Duke Energy Corp. |
837 | 77,096 | ||||||
|
Evergy Inc. |
976 | 53,875 | ||||||
|
Exelon Corp. |
1,336 | 53,293 | ||||||
|
FirstEnergy Corp. |
967 | 28,739 | ||||||
|
NextEra Energy Inc. |
756 | 55,347 | ||||||
|
NRG Energy Inc. |
1,462 | 46,229 | ||||||
|
Southern Co. (The) |
1,120 | 64,344 | ||||||
|
|
|
|||||||
| 427,485 | ||||||||
| Electrical Equipment — 0.6% | ||||||||
|
Eaton Corp. PLC |
868 | 90,090 | ||||||
|
Emerson Electric Co. |
1,118 | 72,435 | ||||||
|
Rockwell Automation Inc. |
194 | 46,001 | ||||||
|
|
|
|||||||
| 208,526 | ||||||||
| Electronic Equipment, Instruments & Components — 0.5% | ||||||||
|
Amphenol Corp., Class A |
273 | 30,805 | ||||||
|
CDW Corp./DE |
239 | 29,302 | ||||||
|
Corning Inc. |
1,559 | 49,841 | ||||||
|
TE Connectivity Ltd. |
531 | 51,443 | ||||||
|
|
|
|||||||
| 161,391 | ||||||||
| Energy Equipment & Services — 0.3% | ||||||||
|
Baker Hughes Co. |
2,832 | 41,828 | ||||||
|
Halliburton Co. |
1,464 | 17,656 | ||||||
|
Schlumberger Ltd. |
1,685 | 25,174 | ||||||
|
|
|
|||||||
| 84,658 | ||||||||
| Entertainment — 0.2% | ||||||||
|
Electronic Arts Inc.(a) |
267 | 31,995 | ||||||
|
Walt Disney Co. (The) |
401 | 48,621 | ||||||
|
|
|
|||||||
| 80,616 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 1.6% | ||||||||
|
American Tower Corp. |
256 | 58,790 | ||||||
|
AvalonBay Communities Inc. |
138 | 19,200 | ||||||
|
Crown Castle International Corp. |
421 | 65,760 | ||||||
|
Digital Realty Trust Inc. |
135 | 19,481 | ||||||
| Security | Shares | Value | ||||||
| Equity Real Estate Investment Trusts (REITs) (continued) | ||||||||
|
Equity Residential |
484 | $ | 22,738 | |||||
|
Essex Property Trust Inc. |
98 | 20,050 | ||||||
|
Healthpeak Properties Inc. |
960 | 25,891 | ||||||
|
Host Hotels & Resorts Inc. |
2,123 | 22,249 | ||||||
|
Iron Mountain Inc. |
750 | 19,545 | ||||||
|
Prologis Inc. |
545 | 54,064 | ||||||
|
Public Storage |
185 | 42,378 | ||||||
|
SBA Communications Corp. |
81 | 23,520 | ||||||
|
Simon Property Group Inc. |
1,291 | 81,088 | ||||||
|
SL Green Realty Corp. |
570 | 24,402 | ||||||
|
Ventas Inc. |
443 | 17,485 | ||||||
|
Weyerhaeuser Co. |
1,139 | 31,083 | ||||||
|
|
|
|||||||
| 547,724 | ||||||||
| Food & Staples Retailing — 1.4% | ||||||||
|
Costco Wholesale Corp. |
135 | 48,279 | ||||||
|
Kroger Co. (The) |
868 | 27,958 | ||||||
|
Sysco Corp. |
985 | 54,480 | ||||||
|
Walgreens Boots Alliance Inc. |
3,654 | 124,382 | ||||||
|
Walmart Inc. |
1,541 | 213,814 | ||||||
|
|
|
|||||||
| 468,913 | ||||||||
| Food Products — 0.8% | ||||||||
|
Archer-Daniels-Midland Co. |
701 | 32,414 | ||||||
|
General Mills Inc. |
659 | 38,960 | ||||||
|
Hershey Co. (The) |
194 | 26,667 | ||||||
|
Kellogg Co. |
338 | 21,257 | ||||||
|
Kraft Heinz Co. (The) |
1,058 | 32,364 | ||||||
|
Mondelez International Inc., Class A |
1,832 | 97,316 | ||||||
|
Tyson Foods Inc., Class A |
412 | 23,579 | ||||||
|
|
|
|||||||
| 272,557 | ||||||||
| Health Care Equipment & Supplies — 1.0% | ||||||||
|
Abbott Laboratories |
953 | 100,170 | ||||||
|
Baxter International Inc. |
787 | 61,048 | ||||||
|
Edwards Lifesciences Corp.(a) |
263 | 18,854 | ||||||
|
Medtronic PLC |
1,286 | 129,333 | ||||||
|
Stryker Corp. |
139 | 28,079 | ||||||
|
|
|
|||||||
| 337,484 | ||||||||
| Health Care Providers & Services — 2.3% | ||||||||
|
AmerisourceBergen Corp. |
265 | 25,459 | ||||||
|
Anthem Inc. |
309 | 84,295 | ||||||
|
Cardinal Health Inc. |
703 | 32,190 | ||||||
|
Cigna Corp. |
277 | 46,251 | ||||||
|
CVS Health Corp. |
1,470 | 82,452 | ||||||
|
DaVita Inc.(a) |
405 | 34,931 | ||||||
|
HCA Healthcare Inc. |
288 | 35,695 | ||||||
|
Humana Inc. |
111 | 44,320 | ||||||
|
Laboratory Corp. of America Holdings(a) |
105 | 20,976 | ||||||
|
McKesson Corp. |
403 | 59,439 | ||||||
|
Quest Diagnostics Inc. |
201 | 24,550 | ||||||
|
UnitedHealth Group Inc. |
795 | 242,586 | ||||||
|
Universal Health Services Inc., Class B |
197 | 21,581 | ||||||
|
|
|
|||||||
| 754,725 | ||||||||
| Health Care Technology — 0.1% | ||||||||
|
Cerner Corp. |
638 | 44,718 | ||||||
|
|
|
|||||||
| Hotels, Restaurants & Leisure — 2.5% | ||||||||
|
Carnival Corp. |
1,709 | 23,430 | ||||||
|
Darden Restaurants Inc. |
94 | 8,640 | ||||||
|
Domino’s Pizza Inc. |
56 | 21,186 | ||||||
|
Hilton Worldwide Holdings Inc. |
439 | 38,549 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
27 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Hotels, Restaurants & Leisure (continued) | ||||||||
|
Hyatt Hotels Corp., Class A |
261 | $ | 14,392 | |||||
|
Las Vegas Sands Corp. |
732 | 35,180 | ||||||
|
Marriott International Inc./MD, Class A |
612 | 56,843 | ||||||
|
McDonald’s Corp. |
1,184 | 252,192 | ||||||
|
Royal Caribbean Cruises Ltd. |
233 | 13,146 | ||||||
|
Starbucks Corp. |
3,562 | 309,751 | ||||||
|
Yum! Brands Inc. |
560 | 52,265 | ||||||
|
|
|
|||||||
| 825,574 | ||||||||
| Household Durables — 0.3% | ||||||||
|
DR Horton Inc. |
283 | 18,907 | ||||||
|
Lennar Corp., Class A |
327 | 22,965 | ||||||
|
Newell Brands Inc. |
717 | 12,662 | ||||||
|
NVR Inc.(a) |
5 | 19,766 | ||||||
|
Whirlpool Corp. |
97 | 17,941 | ||||||
|
|
|
|||||||
| 92,241 | ||||||||
| Household Products — 1.9% | ||||||||
|
Clorox Co. (The) |
151 | 31,295 | ||||||
|
Colgate-Palmolive Co. |
1,070 | 84,412 | ||||||
|
Kimberly-Clark Corp. |
476 | 63,113 | ||||||
|
Procter & Gamble Co. (The) |
3,342 | 458,188 | ||||||
|
|
|
|||||||
| 637,008 | ||||||||
| Independent Power and Renewable Electricity Producers — 0.1% | ||||||||
|
Vistra Corp. |
1,561 | 27,115 | ||||||
|
|
|
|||||||
| Industrial Conglomerates — 1.1% | ||||||||
|
3M Co. |
996 | 159,320 | ||||||
|
Honeywell International Inc. |
1,312 | 216,415 | ||||||
|
|
|
|||||||
| 375,735 | ||||||||
| Insurance — 2.7% | ||||||||
|
Aflac Inc. |
2,009 | 68,205 | ||||||
|
Allstate Corp. (The) |
968 | 85,910 | ||||||
|
American International Group Inc. |
2,171 | 68,365 | ||||||
|
Aon PLC, Class A |
306 | 56,307 | ||||||
|
Assured Guaranty Ltd. |
961 | 24,534 | ||||||
|
Chubb Ltd. |
724 | 94,055 | ||||||
|
Cincinnati Financial Corp. |
213 | 15,067 | ||||||
|
Hartford Financial Services Group Inc. (The) |
536 | 20,647 | ||||||
|
Lincoln National Corp. |
1,024 | 35,942 | ||||||
|
Loews Corp. |
1,366 | 47,373 | ||||||
|
Marsh & McLennan Companies Inc. |
321 | 33,211 | ||||||
|
MetLife Inc. |
2,929 | 110,863 | ||||||
|
Principal Financial Group Inc. |
720 | 28,238 | ||||||
|
Prudential Financial Inc. |
1,753 | 112,227 | ||||||
|
Travelers Companies Inc. (The) |
628 | 75,806 | ||||||
|
Unum Group |
901 | 15,912 | ||||||
|
Willis Towers Watson PLC |
87 | 15,876 | ||||||
|
|
|
|||||||
| 908,538 | ||||||||
| Interactive Media & Services — 2.5% | ||||||||
|
Alphabet Inc., Class A(a) |
191 | 308,677 | ||||||
|
Alphabet Inc., Class C, NVS(a) |
186 | 301,508 | ||||||
|
Facebook Inc., Class A(a) |
890 | 234,168 | ||||||
|
|
|
|||||||
| 844,353 | ||||||||
| Internet & Direct Marketing Retail — 1.2% | ||||||||
|
Booking Holdings Inc.(a) |
121 | 196,323 | ||||||
|
eBay Inc. |
3,581 | 170,563 | ||||||
|
Expedia Group Inc. |
321 | 30,222 | ||||||
|
Qurate Retail Inc., Series A |
1,440 | 9,749 | ||||||
|
|
|
|||||||
| 406,857 | ||||||||
| Security | Shares | Value | ||||||
| IT Services — 4.1% | ||||||||
|
Accenture PLC, Class A |
539 | $ | 116,914 | |||||
|
Akamai Technologies Inc.(a) |
155 | 14,744 | ||||||
|
Alliance Data Systems Corp. |
476 | 24,533 | ||||||
|
Automatic Data Processing Inc. |
606 | 95,724 | ||||||
|
Broadridge Financial Solutions Inc. |
118 | 16,237 | ||||||
|
Cognizant Technology Solutions Corp., Class A |
1,028 | 73,420 | ||||||
|
DXC Technology Co. |
1,738 | 32,014 | ||||||
|
Fidelity National Information Services Inc. |
322 | 40,118 | ||||||
|
Fiserv Inc.(a) |
436 | 41,625 | ||||||
|
FleetCor Technologies Inc.(a) |
110 | 24,300 | ||||||
|
Global Payments Inc. |
122 | 19,244 | ||||||
|
International Business Machines Corp. |
2,200 | 245,652 | ||||||
|
Leidos Holdings Inc. |
208 | 17,264 | ||||||
|
Mastercard Inc., Class A |
569 | 164,236 | ||||||
|
Paychex Inc. |
423 | 34,792 | ||||||
|
PayPal Holdings Inc.(a) |
287 | 53,419 | ||||||
|
VeriSign Inc.(a) |
116 | 22,121 | ||||||
|
Visa Inc., Class A |
1,708 | 310,361 | ||||||
|
Western Union Co. (The) |
1,211 | 23,542 | ||||||
|
|
|
|||||||
| 1,370,260 | ||||||||
| Life Sciences Tools & Services — 0.7% | ||||||||
|
Agilent Technologies Inc. |
339 | 34,609 | ||||||
|
IQVIA Holdings Inc.(a) |
195 | 30,028 | ||||||
|
Mettler-Toledo International Inc.(a) |
21 | 20,956 | ||||||
|
Thermo Fisher Scientific Inc. |
166 | 78,538 | ||||||
|
Waters Corp.(a) |
277 | 61,721 | ||||||
|
|
|
|||||||
| 225,852 | ||||||||
| Machinery — 1.6% | ||||||||
|
Allison Transmission Holdings Inc. |
455 | 16,448 | ||||||
|
Caterpillar Inc. |
1,304 | 204,793 | ||||||
|
Cummins Inc. |
326 | 71,684 | ||||||
|
Deere & Co. |
282 | 63,707 | ||||||
|
Dover Corp. |
137 | 15,167 | ||||||
|
Illinois Tool Works Inc. |
452 | 88,538 | ||||||
|
PACCAR Inc. |
256 | 21,857 | ||||||
|
Parker-Hannifin Corp. |
160 | 33,338 | ||||||
|
Stanley Black & Decker Inc. |
26 | 4,321 | ||||||
|
|
|
|||||||
| 519,853 | ||||||||
| Media — 1.2% | ||||||||
|
Altice USA Inc., Class A(a) |
1,478 | 39,832 | ||||||
|
Charter Communications Inc., Class A(a) |
248 | 149,747 | ||||||
|
Comcast Corp., Class A |
2,999 | 126,678 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class
C,
|
833 | 28,822 | ||||||
|
Omnicom Group Inc. |
646 | 30,491 | ||||||
|
Sirius XM Holdings Inc. |
3,649 | 20,909 | ||||||
|
ViacomCBS Inc., Class B, NVS |
725 | 20,713 | ||||||
|
|
|
|||||||
| 417,192 | ||||||||
| Metals & Mining — 0.3% | ||||||||
|
Newmont Corp. |
470 | 29,535 | ||||||
|
Nucor Corp. |
715 | 34,148 | ||||||
|
Reliance Steel & Aluminum Co. |
173 | 18,855 | ||||||
|
Steel Dynamics Inc. |
728 | 22,918 | ||||||
|
|
|
|||||||
| 105,456 | ||||||||
| Mortgage Real Estate Investment — 0.0% | ||||||||
|
Starwood Property Trust Inc. |
1,188 | 16,596 | ||||||
|
|
|
|||||||
| Multi-Utilities — 0.2% | ||||||||
|
Public Service Enterprise Group Inc. |
610 | 35,472 | ||||||
| 28 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Multi-Utilities (continued) | ||||||||
|
WEC Energy Group Inc. |
311 | $ | 31,271 | |||||
|
|
|
|||||||
| 66,743 | ||||||||
| Multiline Retail — 0.5% | ||||||||
|
Dollar General Corp. |
272 | 56,769 | ||||||
|
Kohl’s Corp. |
1,173 | 24,973 | ||||||
|
Target Corp. |
633 | 96,356 | ||||||
|
|
|
|||||||
| 178,098 | ||||||||
| Oil, Gas & Consumable Fuels — 4.5% | ||||||||
|
Cabot Oil & Gas Corp. |
1,280 | 22,771 | ||||||
|
Chevron Corp. |
4,460 | 309,970 | ||||||
|
ConocoPhillips |
4,671 | 133,684 | ||||||
|
Devon Energy Corp. |
8,104 | 72,369 | ||||||
|
EOG Resources Inc. |
642 | 21,982 | ||||||
|
Exxon Mobil Corp. |
13,454 | 438,869 | ||||||
|
Hess Corp. |
338 | 12,580 | ||||||
|
HollyFrontier Corp. |
933 | 17,270 | ||||||
|
Kinder Morgan Inc./DE |
5,110 | 60,809 | ||||||
|
Marathon Oil Corp. |
5,147 | 20,382 | ||||||
|
Marathon Petroleum Corp. |
3,138 | 92,571 | ||||||
|
ONEOK Inc. |
1,439 | 41,731 | ||||||
|
Ovintiv Inc. |
2,659 | 24,463 | ||||||
|
Phillips 66 |
1,695 | 79,089 | ||||||
|
Pioneer Natural Resources Co. |
279 | 22,197 | ||||||
|
Valero Energy Corp. |
2,126 | 82,085 | ||||||
|
Williams Companies Inc. (The) |
2,984 | 57,263 | ||||||
|
|
|
|||||||
| 1,510,085 | ||||||||
| Personal Products — 0.2% | ||||||||
|
Estee Lauder Companies Inc. (The), Class A |
252 | 55,354 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 5.5% | ||||||||
|
Bristol-Myers Squibb Co. |
4,343 | 253,848 | ||||||
|
Eli Lilly & Co. |
1,047 | 136,592 | ||||||
|
Johnson & Johnson |
3,815 | 523,075 | ||||||
|
Merck & Co. Inc. |
4,924 | 370,334 | ||||||
|
Pfizer Inc. |
14,644 | 519,569 | ||||||
|
Zoetis Inc. |
200 | 31,710 | ||||||
|
|
|
|||||||
| 1,835,128 | ||||||||
| Professional Services — 0.2% | ||||||||
|
IHS Markit Ltd. |
399 | 32,267 | ||||||
|
Verisk Analytics Inc. |
105 | 18,687 | ||||||
|
|
|
|||||||
| 50,954 | ||||||||
| Road & Rail — 1.5% | ||||||||
|
CSX Corp. |
1,814 | 143,197 | ||||||
|
Norfolk Southern Corp. |
528 | 110,415 | ||||||
|
Union Pacific Corp. |
1,350 | 239,207 | ||||||
|
|
|
|||||||
| 492,819 | ||||||||
| Semiconductors & Semiconductor Equipment — 6.2% | ||||||||
|
Analog Devices Inc. |
404 | 47,886 | ||||||
|
Applied Materials Inc. |
1,525 | 90,326 | ||||||
|
Broadcom Inc. |
873 | 305,227 | ||||||
|
Intel Corp. |
11,387 | 504,216 | ||||||
|
KLA Corp. |
274 | 54,027 | ||||||
|
Lam Research Corp. |
355 | 121,438 | ||||||
|
Maxim Integrated Products Inc. |
502 | 34,964 | ||||||
|
NVIDIA Corp. |
56 | 28,076 | ||||||
|
QUALCOMM Inc. |
4,438 | 547,472 | ||||||
|
Skyworks Solutions Inc. |
240 | 33,910 | ||||||
|
Teradyne Inc. |
257 | 22,578 | ||||||
|
Texas Instruments Inc. |
1,727 | 249,707 | ||||||
| Security | Shares | Value | ||||||
| Semiconductors & Semiconductor Equipment (continued) | ||||||||
|
Xilinx Inc. |
335 | $ | 39,761 | |||||
|
|
|
|||||||
| 2,079,588 | ||||||||
| Software — 5.8% | ||||||||
|
Adobe Inc.(a) |
175 | 78,242 | ||||||
|
Citrix Systems Inc. |
278 | 31,489 | ||||||
|
Intuit Inc. |
102 | 32,097 | ||||||
|
Microsoft Corp. |
5,607 | 1,135,249 | ||||||
|
NortonLifeLock Inc. |
1,610 | 33,118 | ||||||
|
Oracle Corp. |
10,472 | 587,584 | ||||||
|
Palo Alto Networks Inc.(a) |
108 | 23,889 | ||||||
|
VMware Inc., Class A(a) |
215 | 27,677 | ||||||
|
|
|
|||||||
| 1,949,345 | ||||||||
| Specialty Retail — 2.6% | ||||||||
|
AutoZone Inc.(a) |
46 | 51,933 | ||||||
|
Best Buy Co. Inc. |
379 | 42,277 | ||||||
|
CarMax Inc.(a) |
173 | 14,954 | ||||||
|
Home Depot Inc. (The) |
1,593 | 424,869 | ||||||
|
Lowe’s Companies Inc. |
1,027 | 162,369 | ||||||
|
O’Reilly Automotive Inc.(a) |
95 | 41,477 | ||||||
|
Ross Stores Inc. |
523 | 44,544 | ||||||
|
TJX Companies Inc. (The) |
1,352 | 68,682 | ||||||
|
Tractor Supply Co. |
119 | 15,852 | ||||||
|
Ulta Beauty Inc.(a) |
80 | 16,542 | ||||||
|
|
|
|||||||
| 883,499 | ||||||||
| Technology Hardware, Storage & Peripherals — 6.3% | ||||||||
|
Apple Inc. |
14,604 | 1,589,791 | ||||||
|
Dell Technologies Inc., Class C(a) |
2,728 | 164,389 | ||||||
|
Hewlett Packard Enterprise Co. |
9,515 | 82,210 | ||||||
|
HP Inc. |
5,364 | 96,337 | ||||||
|
NetApp Inc. |
1,385 | 60,788 | ||||||
|
Seagate Technology PLC |
1,002 | 47,916 | ||||||
|
Western Digital Corp. |
671 | 25,317 | ||||||
|
Xerox Holdings Corp. |
1,310 | 22,768 | ||||||
|
|
|
|||||||
| 2,089,516 | ||||||||
| Textiles, Apparel & Luxury Goods — 0.7% | ||||||||
|
Nike Inc., Class B |
1,374 | 164,990 | ||||||
|
Ralph Lauren Corp. |
296 | 19,787 | ||||||
|
Tapestry Inc. |
1,103 | 24,520 | ||||||
|
VF Corp. |
464 | 31,181 | ||||||
|
|
|
|||||||
| 240,478 | ||||||||
| Tobacco — 1.2% | ||||||||
|
Altria Group Inc. |
5,367 | 193,641 | ||||||
|
Philip Morris International Inc. |
3,031 | 215,262 | ||||||
|
|
|
|||||||
| 408,903 | ||||||||
| Trading Companies & Distributors — 0.2% | ||||||||
|
Fastenal Co. |
456 | 19,713 | ||||||
|
United Rentals Inc.(a) |
149 | 26,565 | ||||||
|
WW Grainger Inc. |
62 | 21,701 | ||||||
|
|
|
|||||||
| 67,979 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
33,328,976 | |||||||
|
|
|
|||||||
|
S C H E D U L E O F I N V E S T M E N T S |
29 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Short-Term Investments | ||||||||
| Money Market Funds — 0.1% | ||||||||
|
BlackRock Cash Funds: Treasury,
|
||||||||
|
0.04%(b)(c) |
40,000 | $ | 40,000 | |||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.1%
|
40,000 | |||||||
|
|
|
|||||||
|
Total Investments in Securities — 99.9%
|
33,368,976 | |||||||
|
Other Assets, Less Liabilities — 0.1% |
40,510 | |||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 33,409,486 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
$ | 70,000 | $ | — | $(30,000 | )(a) | $ | — | $ | — | $ | 40,000 | 40,000 | $ | 38 | $ | — | |||||||||||||||||||
|
BlackRock Inc. |
76,310 | 87,021 | (20,423 | ) | 4,178 | 14,101 | 161,187 | 269 | 1,209 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 4,178 | $ | 14,101 | $ | 201,187 | $ | 1,247 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount
|
Value/
(Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 Micro E-Mini Index |
4 | 12/18/20 | $ | 65 | $ | (2,911 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 2,911 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
| 30 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® U.S. Dividend and Buyback ETF |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 16,774 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (4,055 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
|
||||
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 53,196 | ||
|
|
||||
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 33,328,976 | $ | — | $ | — | $ | 33,328,976 | ||||||||
|
Money Market Funds |
40,000 | — | — | 40,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 33,368,976 | $ | — | $ | — | $ | 33,368,976 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (2,911 | ) | $ | — | $ | — | $ | (2,911 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
31 |
|
Statements of Assets and Liabilities (unaudited) October 31, 2020 |
|
See notes to financial statements.
| 32 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Statements of Assets and Liabilities (unaudited) (continued) October 31, 2020 |
|
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
33 |
|
Statements of Operations (unaudited) Six Months Ended October 31, 2020 |
|
See notes to financial statements.
| 34 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Statements of Operations (unaudited) (continued) Six Months Ended October 31, 2020 |
|
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
35 |
| Statements of Changes in Net Assets |
|
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 36 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
37 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 38 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
(For a share outstanding throughout each period) |
|
| iShares Core Dividend Growth ETF | ||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Six Months Ended
(unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 36.39 | $ | 38.13 | $ | 33.86 | $ | 30.75 | $ | 26.72 | $ | 26.35 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
0.53 | 0.99 | 0.91 | 0.78 | 0.71 | 0.67 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
2.51 | (1.77 | ) | 4.20 | 3.07 | 3.98 | 0.34 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
3.04 | (0.78 | ) | 5.11 | 3.85 | 4.69 | 1.01 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(0.51 | ) | (0.96 | ) | (0.84 | ) | (0.74 | ) | (0.66 | ) | (0.64 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(0.51 | ) | (0.96 | ) | (0.84 | ) | (0.74 | ) | (0.66 | ) | (0.64 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 38.92 | $ | 36.39 | $ | 38.13 | $ | 33.86 | $ | 30.75 | $ | 26.72 | ||||||||||||||||
|
|
|
|
|
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|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
8.39 | %(d) | (2.05 | )% | 15.30 | % | 12.59 | % | 17.78 | % | 3.95 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.08 | %(e) | 0.08 | % | 0.08 | % | 0.08 | % | 0.09 | % | 0.12 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total expenses after fees waived |
0.08 | %(e) | 0.08 | % | 0.08 | % | 0.08 | % | 0.09 | % | 0.10 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
2.70 | %(e) | 2.55 | % | 2.55 | % | 2.32 | % | 2.46 | % | 2.62 | % | ||||||||||||||||
|
|
|
|
|
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|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 11,678,444 | $ | 9,355,727 | $ | 7,084,809 | $ | 3,343,410 | $ | 1,429,997 | $ | 476,955 | ||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
13 | %(d) | 24 | % | 26 | % | 24 | % | 27 | % | 45 | % | ||||||||||||||||
|
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|
|
|
|
|
|
|
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|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
39 |
|
Financial Highlights (continued) (For a share outstanding throughout each period) |
|
| iShares Core High Dividend ETF | ||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 81.85 | $ | 95.42 | $ | 84.44 | $ | 83.27 | $ | 78.83 | $ | 77.18 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
1.84 | 3.24 | 3.09 | 2.99 | 2.85 | 2.70 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
(4.14 | ) | (13.51 | ) | 11.01 | 1.20 | 4.34 | 1.79 | ||||||||||||||||||||
|
|
|
|
|
|
|
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|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
(2.30 | ) | (10.27 | ) | 14.10 | 4.19 | 7.19 | 4.49 | ||||||||||||||||||||
|
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|
|
|
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|
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|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(1.73 | ) | (3.30 | ) | (3.12 | ) | (3.02 | ) | (2.75 | ) | (2.84 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(1.73 | ) | (3.30 | ) | (3.12 | ) | (3.02 | ) | (2.75 | ) | (2.84 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 77.82 | $ | 81.85 | $ | 95.42 | $ | 84.44 | $ | 83.27 | $ | 78.83 | ||||||||||||||||
|
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|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
(2.87 | )%(d) | (10.86 | )% | 17.05 | % | 5.03 | % | 9.22 | % | 6.12 | % | ||||||||||||||||
|
|
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|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.08 | %(e) | 0.08 | % | 0.08 | % | 0.08 | % | 0.10 | % | 0.12 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
4.43 | %(e) | 3.53 | % | 3.48 | % | 3.47 | % | 3.49 | % | 3.63 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
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|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 5,077,681 | $ | 6,036,798 | $ | 7,175,741 | $ | 6,007,744 | $ | 6,632,679 | $ | 5,076,953 | ||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
30 | %(d) | 62 | % | 57 | % | 46 | % | 49 | % | 74 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 40 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Financial Highlights (continued) (For a share outstanding throughout each period) |
|
| iShares International Select Dividend ETF | ||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 24.14 | $ | 31.59 | $ | 34.11 | $ | 31.78 | $ | 29.85 | $ | 35.09 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
0.59 | 1.83 | 1.71 | 1.43 | 1.42 | (b) | 1.51 | |||||||||||||||||||||
|
Net realized and unrealized gain (loss)(c) |
0.07 | (7.10 | ) | (2.48 | ) | 2.41 | 1.88 | (5.18 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
0.66 | (5.27 | ) | (0.77 | ) | 3.84 | 3.30 | (3.67 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(d) |
||||||||||||||||||||||||||||
|
From net investment income |
(0.60 | ) | (2.18 | ) | (1.75 | ) | (1.51 | ) | (1.37 | ) | (1.57 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(0.60 | ) | (2.18 | ) | (1.75 | ) | (1.51 | ) | (1.37 | ) | (1.57 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 24.20 | $ | 24.14 | $ | 31.59 | $ | 34.11 | $ | 31.78 | $ | 29.85 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
2.67 | %(e) | (17.15 | )% | (2.13 | )% | 12.35 | % | 11.47 | %(b) | (10.37 | )% | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses(f) |
0.50 | %(g) | 0.49 | % | 0.49 | % | 0.49 | % | 0.50 | % | 0.50 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total expenses after fees waived(f) |
0.49 | %(g) | 0.49 | % | 0.49 | % | 0.49 | % | 0.50 | % | 0.50 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total expenses excluding professional fees for foreign withholding tax claims |
N/A | N/A | 0.49 | % | N/A | 0.50 | % | N/A | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
4.62 | %(g) | 6.06 | % | 5.39 | % | 4.27 | % | 4.75 | %(b) | 4.97 | % | ||||||||||||||||
|
|
|
|
|
|
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|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 3,092,880 | $ | 3,421,123 | $ | 4,377,418 | $ | 4,922,792 | $ | 4,010,716 | $ | 2,737,391 | ||||||||||||||||
|
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|
|
|
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|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(h)(i) |
61 | %(e) | 12 | % | 35 | % | 24 | % | 29 | % | 27 | % | ||||||||||||||||
|
|
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|
|
|
|
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|
|
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|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
Reflects the one-time, positive effect of foreign withholding tax claims, net of the associated professional fees, which resulted in the following increases: |
| • |
Net investment income per share by $0.04. |
| • |
Total return by 0.10%. |
| • |
Ratio of net investment income to average net assets by 0.13%. |
| (c) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (d) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (e) |
Not annualized. |
| (f) |
The Fund indirectly bears its proportionate share of fees and expenses incurred by the underlying fund in which the Fund is invested. This ratio does not include these indirect fees and expenses. |
| (g) |
Annualized. |
| (h) |
Portfolio turnover rate excludes in-kind transactions. |
| (i) |
Portfolio turnover rate excludes the portfolio activity of the underlying fund in which the Fund is invested. See the underlying fund’s financial highlights for its respective portfolio turnover rates. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
41 |
|
Financial Highlights (continued) (For a share outstanding throughout each period) |
|
| iShares Select Dividend ETF | ||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 80.66 | $ | 101.13 | $ | 96.31 | $ | 91.51 | $ | 82.05 | $ | 78.32 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income(a) |
1.80 | 3.51 | 3.31 | 3.08 | 2.82 | 2.57 | ||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
2.20 | (20.30 | ) | 4.80 | 4.76 | 9.41 | 3.78 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net increase (decrease) from investment operations |
4.00 | (16.79 | ) | 8.11 | 7.84 | 12.23 | 6.35 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||
|
From net investment income |
(1.75 | ) | (3.68 | ) | (3.29 | ) | (3.04 | ) | (2.77 | ) | (2.62 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total distributions |
(1.75 | ) | (3.68 | ) | (3.29 | ) | (3.04 | ) | (2.77 | ) | (2.62 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net asset value, end of period |
$ | 82.91 | $ | 80.66 | $ | 101.13 | $ | 96.31 | $ | 91.51 | $ | 82.05 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||
|
Based on net asset value |
5.02 | %(d) | (16.96 | )% | 8.63 | % | 8.65 | % | 15.12 | % | 8.42 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||
|
Total expenses |
0.39 | %(e) | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Net investment income |
4.31 | %(e) | 3.60 | % | 3.40 | % | 3.24 | % | 3.23 | % | 3.36 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 12,336,668 | $ | 13,257,023 | $ | 17,585,695 | $ | 16,714,032 | $ | 17,200,059 | $ | 14,645,360 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Portfolio turnover rate(f) |
28 | %(d) | 6 | % | 21 | % | 28 | % | 19 | % | 21 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 42 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Financial Highlights (continued) (For a share outstanding throughout each period) |
|
| iShares U.S. Dividend and Buyback ETF | ||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||
| Six Months Ended |
Period From
|
|||||||||||||||||||||||||||||||
| 10/31/20 | Year Ended | Year Ended | 11/07/17 | (a) | ||||||||||||||||||||||||||||
| (unaudited) | 04/30/20 | 04/30/19 | to 04/30/18 | |||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 25.94 | $ | 27.96 | $ | 25.30 | $ | 24.99 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Net investment income(b) |
0.35 | 0.64 | 0.61 | 0.26 | ||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(c) |
1.88 | (2.02 | ) | 2.67 | 0.28 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
2.23 | (1.38 | ) | 3.28 | 0.54 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Distributions(d) |
||||||||||||||||||||||||||||||||
|
From net investment income |
(0.33 | ) | (0.64 | ) | (0.58 | ) | (0.23 | ) | ||||||||||||||||||||||||
|
From net realized gain |
— | — | (0.04 | ) | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Total distributions |
(0.33 | ) | (0.64 | ) | (0.62 | ) | (0.23 | ) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 27.84 | $ | 25.94 | $ | 27.96 | $ | 25.30 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||
|
Based on net asset value |
8.63 | %(e) | (4.95 | )% | 13.21 | % | 2.16 | %(e) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(f) | 0.25 | % | 0.25 | % | 0.25 | %(f) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Net investment income |
2.45 | %(f) | 2.31 | % | 2.34 | % | 2.07 | %(f) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 33,409 | $ | 24,645 | $ | 8,389 | $ | 7,591 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
|
Portfolio turnover rate(g) |
19 | %(e) | 33 | % | 31 | % | 14 | %(e) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| (a) |
Commencement of operations. |
| (b) |
Based on average shares outstanding. |
| (c) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (d) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (e) |
Not annualized. |
| (f) |
Annualized. |
| (g) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
43 |
Notes to Financial Statements (unaudited)
| 1. |
ORGANIZATION |
iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.
These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):
| iShares ETF |
Diversification
Classification |
|
|
Core Dividend Growth |
Diversified | |
|
Core High Dividend |
Non-diversified | |
|
International Select Dividend |
Diversified | |
|
Select Dividend |
Diversified | |
|
U.S. Dividend and Buyback |
Non-Diversified |
| 2. |
SIGNIFICANT ACCOUNTING POLICIES |
The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:
Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when the Funds are informed of the ex-dividend date. Under the applicable foreign tax laws, a withholding tax at various rates may be imposed on capital gains, dividends and interest. Any taxes withheld that are reclaimable from foreign tax authorities are reflected in tax reclaims receivable. Upon notification from issuers or as estimated by management, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain.
Foreign Currency Translation: Each Fund’s books and records are maintained in U.S. dollars. Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars using prevailing market rates as quoted by one or more data service providers. Purchases and sales of investments are recorded at the rates of exchange prevailing on the respective dates of such transactions. Generally, when the U.S. dollar rises in value against a foreign currency, the investments denominated in that currency will lose value; the opposite effect occurs if the U.S. dollar falls in relative value.
Each Fund does not isolate the effect of fluctuations in foreign exchange rates from the effect of fluctuations in the market prices of investments for financial reporting purposes. Accordingly, the effects of changes in exchange rates on investments are not segregated in the statement of operations from the effects of changes in market prices of those investments, but are included as a component of net realized and unrealized gain (loss) from investments. Each Fund reports realized currency gains (losses) on foreign currency related transactions as components of net realized gain (loss) for financial reporting purposes, whereas such components are generally treated as ordinary income for U.S. federal income tax purposes.
Foreign Taxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its statement of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “Other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2020, if any, are disclosed in the statement of assets and liabilities.
Taxes withheld that are reclaimable under applicable foreign tax treaties are reflected in tax reclaims receivable. Reclaim amounts for which collection is uncertain are recorded upon receipt. Tax reclaims recorded or received during the period along with applicable fees associated with the filings of tax claims that result in the recovery of foreign withholding taxes, if any, are included in the statement of operations.
Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.
In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.
| 44 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.
Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.
| 3. |
INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS |
Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. A fund determines the fair value of its financial instruments using various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.
Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:
| • |
Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price. |
| • |
Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV. |
| • |
Futures contracts are valued based on that day’s last reported settlement price on the exchange where the contract is traded. |
If events (e.g., a market closure, market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and the cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.
Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.
Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:
| • |
Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access; |
| • |
Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs); and |
| • |
Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments). |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgement exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.
| 4. |
SECURITIES AND OTHER INVESTMENTS |
Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
45 |
Notes to Financial Statements (unaudited) (continued)
exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.
As of October 31, 2020, any securities on loan were collateralized by cash and/or U.S. government obligations. Cash collateral received was invested in money market funds managed by BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, or its affiliates and is disclosed in the schedules of investments. Any non-cash collateral received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan for each Fund, if any, are also disclosed in its schedule of investments. The market value of any securities on loan as of October 31, 2020 and the value of the related cash collateral are disclosed in the statements of assets and liabilities.
Securities lending transactions are entered into by a fund under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value of the collateral is typically greater than the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the fund can reinvest cash collateral received in connection with loaned securities.
As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA as of October 31, 2020:
| iShares ETF and Counterparty |
|
Market Value of
Securities on Loan |
|
|
Cash Collateral
Received |
(a) |
|
Non-Cash Collateral
Received |
|
Net Amount | ||||||
|
International Select Dividend |
||||||||||||||||
|
Morgan Stanley & Co. LLC |
$ | 6,309,323 | $ | 6,309,323 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 6,309,323 | 6,309,323 | $ | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
| (a) |
Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s statement of assets and liabilities. |
The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.
| 5. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: Each Fund’s use of futures contracts is generally limited to cash equitization. This involves the use of available cash to invest in index futures contracts in order to gain exposure to the equity markets represented in or by the Fund’s underlying index and is intended to allow the Fund to better track its underlying index. Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).
Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the statement of assets and liabilities.
Securities deposited as initial margin are designated in the schedule of investments and cash deposited, if any, are shown as cash pledged for futures contracts in the statement of assets and liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the statement of assets and liabilities. When the contract is closed, a realized gain or loss is recorded in the statement of operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.
| 46 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 6. |
INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES |
Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).
For its investment advisory services to each of the following Funds, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on the average daily net assets of each Fund as follows:
| iShares ETF | Investment Advisory Fee | |||
|
Core Dividend Growth |
0.08 | % | ||
|
Core High Dividend |
0.08 | |||
|
U.S. Dividend and Buyback |
0.25 | |||
For its investment advisory services to the iShares International Select Dividend ETF, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Fund, based on the Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:
| Aggregate Average Daily Net Assets | Investment Advisory Fee | |||
|
First $12 billion |
0.5000 | % | ||
|
Over $12 billion, up to and including $18 billion |
0.4750 | |||
|
Over $18 billion, up to and including $24 billion |
0.4513 | |||
|
Over $24 billion, up to and including $30 billion |
0.4287 | |||
|
Over $30 billion |
0.4073 | |||
Each reduced investment advisory fee level reflects a 5% reduction (rounded to the fourth decimal place) from the investment advisory fee at the prior aggregate average daily net asset level.
For its investment advisory services to the iShares Select Dividend ETF, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Fund, based on the Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:
| Aggregate Average Daily Net Assets | Investment Advisory Fee | |||
|
First $46 billion |
0.4000 | % | ||
|
Over $46 billion, up to and including $81 billion |
0.3800 | |||
|
Over $81 billion, up to and including $111 billion |
0.3610 | |||
|
Over $111 billion, up to and including $141 billion |
0.3430 | |||
|
Over $141 billion |
0.3259 | |||
Each reduced investment advisory fee level reflects a 5% reduction (rounded to the fourth decimal place) from the investment advisory fee at the prior aggregate average daily net asset level.
Expense Waivers: For the six months ended October 31, 2020, BFA has voluntarily waived a portion of its investment advisory fees for the iShares International Select Dividend ETF in the amount of $122,337.
Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.
Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.
Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.
Pursuant to the current securities lending agreement, each of iShares Core Dividend Growth ETF , iShares Core High Dividend ETF, iShares Select Dividend ETF and iShares U.S. Dividend and Buyback ETF (the “Group 1 Funds”), retains 75% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
47 |
Notes to Financial Statements (unaudited) (continued)
Pursuant to the current securities lending agreement, the iShares International Select Dividend ETF (the “Group 2 Fund”), retains 82% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in a given calendar year exceeds a specified threshold: (1) each Group 1 Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 80% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees, and (2) the Group 2 Fund will retain for the remainder of that calendar year 85% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its statement of operations. For the six months ended October 31, 2020, the Funds paid BTC the following amounts for securities lending agent services:
| iShares ETF |
Fees Paid
to BTC |
|||
|
International Select Dividend |
$ | 42,717 | ||
Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.
Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.
For the six months ended October 31, 2020, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:
| iShares ETF | Purchases | Sales |
Net Realized
Gain (Loss) |
|||||||||
|
Core Dividend Growth |
$ | 446,987,863 | $ | 350,642,990 | $ | (63,808,155 | ) | |||||
|
Core High Dividend |
413,048,224 | 623,143,642 | (157,199,535 | ) | ||||||||
|
International Select Dividend |
45,436,826 | 18,555,478 | (5,540,299 | ) | ||||||||
|
Select Dividend |
669,017,188 | 631,434,153 | (93,046,804 | ) | ||||||||
|
U.S. Dividend and Buyback |
1,467,223 | 717,856 | (6,785 | ) | ||||||||
Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends – affiliated in the statement of operations.
A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.
| 7. |
PURCHASES AND SALES |
For the six months ended October 31, 2020, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
| iShares ETF | Purchases | Sales | ||||||
|
Core Dividend Growth |
$ | 1,400,815,752 | $ | 1,375,223,704 | ||||
|
Core High Dividend |
1,653,786,396 | 1,646,034,040 | ||||||
|
International Select Dividend |
2,000,244,079 | 2,022,871,263 | ||||||
|
Select Dividend |
3,634,981,962 | 3,630,951,518 | ||||||
|
U.S. Dividend and Buyback |
5,915,108 | 5,743,529 | ||||||
For the six months ended October 31, 2020, purchases and sales related to in-kind transactions were as follows:
| iShares ETF |
In-kind
Purchases |
In-kind
Sales |
||||||
|
Core Dividend Growth |
$ | 2,280,880,089 | $ | 621,727,087 | ||||
|
Core High Dividend |
53,601,837 | 743,680,165 | ||||||
|
International Select Dividend |
34,291,240 | 355,199,430 | ||||||
|
Select Dividend |
108,830,186 | 1,375,302,305 | ||||||
|
U.S. Dividend and Buyback |
13,637,291 | 6,369,432 | ||||||
| 48 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 8. |
INCOME TAX INFORMATION |
Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.
Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2020, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.
As of April 30, 2020, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
| iShares ETF | Non-Expiring | |||
|
Core Dividend Growth |
$ | 166,629,089 | ||
|
Core High Dividend |
696,756,118 | |||
|
International Select Dividend |
508,491,487 | |||
|
Select Dividend |
1,148,517,692 | |||
|
U.S. Dividend and Buyback |
143,479 | |||
A fund may own shares in certain foreign investment entities, referred to, under U.S. tax law, as “passive foreign investment companies.” Such fund may elect to mark-to-market annually the shares of each passive foreign investment company and would be required to distribute to shareholders any such marked-to-market gains.
As of October 31, 2020, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:
| iShares ETF | Tax Cost |
Gross Unrealized
Appreciation |
Gross Unrealized
Depreciation |
Net Unrealized
Appreciation (Depreciation) |
||||||||||||
|
Core Dividend Growth |
$ | 10,987,860,411 | $ | 1,409,150,651 | $ | (712,439,928 | ) | $ | 696,710,723 | |||||||
|
Core High Dividend |
5,683,789,546 | 344,522,316 | (951,469,833 | ) | (606,947,517 | ) | ||||||||||
|
International Select Dividend |
3,480,732,135 | 141,445,832 | (547,678,939 | ) | (406,233,107 | ) | ||||||||||
|
Select Dividend |
13,120,876,916 | 1,304,059,896 | (2,077,813,831 | ) | (773,753,935 | ) | ||||||||||
|
U.S. Dividend and Buyback |
32,747,573 | 3,209,387 | (2,590,895 | ) | 618,492 | |||||||||||
| 9. |
LINE OF CREDIT |
The iShares International Select Dividend ETF, along with certain other iShares funds (“Participating Funds”), is a party to a $300 million credit agreement (“Credit Agreement”) with State Street Bank and Trust Company, which expires on July 15, 2021. The line of credit may be used for temporary or emergency purposes, including redemptions, settlement of trades and rebalancing of portfolio holdings in certain target markets. The Credit Agreement sets specific sub limits on aggregate borrowings based on two tiers of Participating Funds: $300 million with respect to the funds within Tier 1, including the Fund, and $200 million with respect to Tier 2. The Funds may borrow up to the aggregate commitment amount subject to asset coverage and other limitations as specified in the Credit Agreement. The Credit Agreement has the following terms: a commitment fee of 0.20% per annum on the unused portion of the credit agreement and interest at a rate equal to the higher of (a) the one-month LIBOR rate (not less than zero) plus 1.00% per annum or (b) the U.S. Federal Funds rate (not less than zero) plus 1.00% per annum on amounts borrowed. The commitment fee is generally allocated to each Participating Fund based on the lesser of a Participating Fund’s relative exposure to certain target markets or a Participating Fund’s maximum borrowing amount as set forth by the terms of the Credit Agreement.
During the six months ended October 31, 2020, the Fund did not borrow under the credit agreement.
| 10. |
PRINCIPAL RISKS |
In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.
BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.
The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
49 |
Notes to Financial Statements (unaudited) (continued)
Market Risk: An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.
Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A fund may invest in illiquid investments. An illiquid investment is any investment that a fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A fund may experience difficulty in selling illiquid investments in a timely manner at the price that it believes the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause a fund’s NAV to experience significant increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a fund may lose value, regardless of the individual results of the securities and other instruments in which a fund invests.
Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the statement of assets and liabilities, less any collateral held by the Funds.
A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.
With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.
Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.
Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific sectors are presented in the schedule of investments.
LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021, and it is expected that LIBOR will cease to be published after that time. The Funds may be exposed to financial instruments tied to LIBOR to determine payment obligations, financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Funds is uncertain.
| 11. |
CAPITAL SHARE TRANSACTIONS |
Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.
Transactions in capital shares were as follows:
|
Six Months Ended
10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
|
Core Dividend Growth |
||||||||||||||||
|
Shares sold |
59,850,000 | $ | 2,295,505,924 | 124,600,000 | $ | 4,863,403,424 | ||||||||||
|
Shares redeemed |
(16,900,000 | ) | (631,688,272 | ) | (53,300,000 | ) | (2,039,035,478 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
42,950,000 | 1,663,817,652 | 71,300,000 | 2,824,367,946 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 50 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
|
|
||||||||||||||||||||
|
|
Six Months Ended
10/31/20 |
|
|
Year Ended
04/30/20 |
|
|||||||||||||||
|
|
|
|
|
|||||||||||||||||
|
iShares ETF |
Shares | Amount | Shares | Amount | ||||||||||||||||
|
|
||||||||||||||||||||
|
Core High Dividend |
||||||||||||||||||||
|
Shares sold |
650,000 | $ | 53,972,138 | 32,500,000 | $ | 3,055,557,360 | ||||||||||||||
|
Shares redeemed |
(9,150,000 | ) | (750,787,883 | ) | (33,950,000 | ) | (3,100,958,055 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net decrease |
(8,500,000 | ) | (696,815,745 | ) | (1,450,000 | ) | (45,400,695 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
International Select Dividend |
||||||||||||||||||||
|
Shares sold |
1,450,000 | 36,253,091 | 20,900,000 | 681,516,303 | ||||||||||||||||
|
Shares redeemed |
(15,350,000 | ) | (379,246,749 | ) | (17,750,000 | ) | (429,125,602 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) |
(13,900,000 | ) | (342,993,658 | ) | 3,150,000 | 252,390,701 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Select Dividend |
||||||||||||||||||||
|
Shares sold |
1,300,000 | 109,388,965 | 16,550,000 | 1,640,928,759 | ||||||||||||||||
|
Shares redeemed |
(16,850,000 | ) | (1,381,785,052 | ) | (26,100,000 | ) | (2,325,424,629 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net decrease |
(15,550,000 | ) | (1,272,396,087 | ) | (9,550,000 | ) | (684,495,870 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
U.S. Dividend and Buyback |
||||||||||||||||||||
|
Shares sold |
500,000 | 13,890,359 | 650,000 | 16,603,236 | ||||||||||||||||
|
Shares redeemed |
(250,000 | ) | (6,493,502 | ) | — | — | ||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase |
250,000 | 7,396,857 | 650,000 | 16,603,236 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||
The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.
From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the statement of assets and liabilities.
| 12. |
LEGAL PROCEEDINGS |
On June 16, 2016, investors in certain iShares funds (iShares Core S&P Small-Cap ETF, iShares Russell 1000 Growth ETF, iShares Core S&P 500 ETF, iShares Russell Mid-Cap Growth ETF, iShares Russell Mid-Cap ETF, iShares Russell Mid-Cap Value ETF, iShares Select Dividend ETF, iShares Morningstar Mid-Cap ETF, iShares Morningstar Large-Cap ETF, iShares U.S. Aerospace & Defense ETF and iShares Preferred and Income Securities ETF) filed a class action lawsuit against iShares Trust, BlackRock, Inc. and certain of its advisory affiliates, and certain directors/trustees and officers of the Funds (collectively, “Defendants”) in California State Court. The lawsuit alleges the Defendants violated federal securities laws by failing to adequately disclose in the prospectuses issued by the funds noted above the risks of using stop-loss orders in the event of a ‘flash crash’, such as the one that occurred on May 6, 2010. On September 18, 2017, the court issued a Statement of Decision holding that the Plaintiffs lack standing to assert their claims. On October 11, 2017, the court entered final judgment dismissing all of the Plaintiffs’ claims with prejudice. In an opinion dated January 23, 2020, the California Court of Appeal affirmed the dismissal of Plaintiffs’ claims. On March 3, 2020, plaintiffs filed a petition for review by the California Supreme Court. On May 27, 2020, the California Supreme Court denied Plaintiff’s petition for review. The case is now closed.
| 13. |
SUBSEQUENT EVENTS |
Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were available to be issued and has determined that there were no subsequent events requiring adjustment or additional disclosure in the financial statements.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
51 |
Board Review and Approval of Investment Advisory Contract
iShares Core Dividend Growth ETF, iShares U.S. Dividend and Buyback ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares
| 52 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Board Review and Approval of Investment Advisory Contract (continued)
funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares Core High Dividend ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers;
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risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue,
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Board Review and Approval of Investment Advisory Contract (continued)
including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares International Select Dividend ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with
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independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
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Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board further noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares Select Dividend ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”),with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the
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extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through
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Board Review and Approval of Investment Advisory Contract (continued)
relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board further noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
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B O A R D R E V I E W A N D A P P R O V A L O F I N V E S T M E N T A D V I S O R Y C O N T R A C T |
59 |
Supplemental Information (unaudited)
Section 19(a) Notices
The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.
October 31, 2020
|
Total Cumulative Distributions
for the Fiscal Year-to-Date |
% Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date |
|||||||||||||||||||||||||||||||
| iShares ETF |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
||||||||||||||||||||||||
|
Core Dividend Growth(a) |
$ | 0.507374 | $ | — | $ | 0.001924 | $ | 0.509298 | 100 | % | — | % | 0 | %(b) | 100 | % | ||||||||||||||||
|
Core High Dividend(a) |
1.695036 | — | 0.035226 | 1.730262 | 98 | — | 2 | 100 | ||||||||||||||||||||||||
|
International Select Dividend(a) |
0.553532 | — | 0.045166 | 0.598698 | 92 | — | 8 | 100 | ||||||||||||||||||||||||
|
Select Dividend(a) |
1.678856 | — | 0.067059 | 1.745915 | 96 | — | 4 | 100 | ||||||||||||||||||||||||
| (a) |
The Fund estimates that it has distributed more than its net investment income and net realized capital 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 shareholder’s investment in the Fund is returned 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”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share. |
| (b) |
Rounds to less than 1%. |
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Electronic Delivery
Shareholders can sign up for email notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.
To enroll in electronic delivery:
| • |
Go to icsdelivery.com. |
| • |
If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor. |
Householding
Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.
Availability of Quarterly Schedule of Investments
The iShares Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The iShares Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. The iShares Funds also disclose their complete schedule of portfolio holdings on a daily basis on the iShares website at iShares.com.
Availability of Proxy Voting Policies and Proxy Voting Records
A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.
A description of the Company’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.
|
G E N E R A L I N F O R M A T I O N |
61 |
Glossary of Terms Used in this Report
| Portfolio Abbreviations - Equity | ||
| ADR | American Depositary Receipt | |
| GDR | Global Depositary Receipt | |
| NVS | Non-Voting Shares | |
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Want to know more?
iShares.com | 1-800-474-2737
This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.
Investing involves risk, including possible loss of principal.
The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Morningstar, Inc. or S&P Dow Jones Indices LLC, nor do these companies make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the companies listed above
©2020 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.
iS-SAR-406-1020
|
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OCTOBER 31, 2020 |
|
|
2020 Semi-Annual Report (Unaudited)
|
|
iShares Trust
| · |
iShares Morningstar Large-Cap ETF | JKD | NYSE Arca |
| · |
iShares Morningstar Large-Cap Growth ETF | JKE | NYSE Arca |
| · |
iShares Morningstar Large-Cap Value ETF | JKF | NYSE Arca |
| · |
iShares Morningstar Mid-Cap ETF | JKG | NYSE Arca |
| · |
iShares Morningstar Mid-Cap Growth ETF | JKH | NYSE Arca |
| · |
iShares Morningstar Mid-Cap Value ETF | JKI | NASDAQ |
| · |
iShares Morningstar Small-Cap ETF | JKJ | NYSE Arca |
| · |
iShares Morningstar Small-Cap Growth ETF | JKK | NYSE Arca |
| · |
iShares Morningstar Small-Cap Value ETF | JKL | NYSE Arca |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.
Dear Shareholder,
The 12-month reporting period as of October 31, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus (or “COVID-19”) led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered solid returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.
After markets hit their lowest point of the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which declined marginally during the reporting period. International equities from developed economies declined, significantly lagging emerging market stocks, which rebounded sharply.
During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.
The Fed took an accommodative monetary stance in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted two emergency interest rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.
Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.
Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring emerging market stocks and tilting toward the quality factor for its resilience.
In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.
Sincerely,
Rob Kapito
President, BlackRock, Inc.
Rob Kapito
President, BlackRock, Inc.
|
Total Returns as of October 31, 2020
|
||||
| 6-Month | 12-Month | |||
|
U.S. large cap equities
|
13.29% | 9.71% | ||
|
U.S. small cap equities
|
18.13 | (0.14) | ||
|
International equities
|
8.57 | (6.86) | ||
|
Emerging market equities
|
20.96 | 8.25 | ||
|
3-month Treasury bills
|
0.06 | 0.92 | ||
|
U.S. Treasury securities
|
(1.63) | 8.92 | ||
|
U.S. investment grade bonds
|
1.27 | 6.19 | ||
|
Tax-exempt municipal bonds
|
4.87 | 3.55 | ||
|
U.S. high yield bonds
|
10.73 | 3.42 | ||
| Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index. | ||||
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T H I S P A G E I S N O T P A R T O F Y O U R F U N D R E P O R T |
| Page | ||||
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| 4 | ||||
| 13 | ||||
| 13 | ||||
| 14 | ||||
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Financial Statements |
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| 50 | ||||
| 53 | ||||
| 56 | ||||
| 61 | ||||
| 70 | ||||
| 80 | ||||
| 84 | ||||
| 85 | ||||
| 86 | ||||
|
|
| Fund Summary as of October 31, 2020 | iShares® Morningstar Large-Cap ETF |
Investment Objective
The iShares Morningstar Large-Cap ETF (the “Fund”) seeks to track the investment results of an index composed of large-capitalization U.S. equities, as represented by the Morningstar® Large Core IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
15.79 | % | 11.10 | % | 11.49 | % | 13.29 | % | 11.10 | % | 72.27 | % | 248.26 | % | ||||||||||||||||||
|
Fund Market |
15.96 | 11.19 | 11.51 | 13.29 | 11.19 | 72.38 | 248.42 | |||||||||||||||||||||||||
|
Index |
15.92 | 11.33 | 11.72 | 13.53 | 11.33 | 74.00 | 255.79 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,157.90 | $ 1.09 | $ 1,000.00 | $ 1,024.20 | $ 1.02 | 0.20 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
26.3 | % | ||
|
Health Care |
25.4 | |||
|
Consumer Discretionary |
11.3 | |||
|
Financials |
11.1 | |||
|
Industrials |
7.2 | |||
|
Consumer Staples |
7.0 | |||
|
Communication Services |
4.5 | |||
|
Materials |
2.9 | |||
|
Utilities |
2.3 | |||
|
Real Estate |
1.6 | |||
|
Energy |
0.4 | |||
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Apple Inc. |
15.9 | % | ||
|
Berkshire Hathaway Inc., Class B |
3.9 | |||
|
UnitedHealth Group Inc. |
2.9 | |||
|
Home Depot Inc. (The) |
2.9 | |||
|
Walt Disney Co. (The) |
2.2 | |||
|
Thermo Fisher Scientific Inc. |
2.0 | |||
|
Merck & Co. Inc. |
2.0 | |||
|
Abbott Laboratories |
2.0 | |||
|
PepsiCo Inc. |
1.9 | |||
|
Coca-Cola Co. (The) |
1.9 | |||
| (a) |
Excludes money market funds. |
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| Fund Summary as of October 31, 2020 | iShares® Morningstar Large-Cap Growth ETF |
Investment Objective
The iShares Morningstar Large-Cap Growth ETF (the “Fund”) seeks to track the investment results of an index composed of large-capitalization U.S. equities that exhibit growth characteristics, as represented by the Morningstar® Large Growth IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
19.51 | % | 31.51 | % | 16.60 | % | 16.17 | % | 31.51 | % | 115.56 | % | 347.71 | % | ||||||||||||||||||
|
Fund Market |
19.61 | 31.58 | 16.62 | 16.17 | 31.58 | 115.73 | 347.77 | |||||||||||||||||||||||||
|
Index |
19.66 | 31.85 | 17.06 | 16.55 | 31.85 | 119.82 | 362.42 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,195.10 | $ 1.38 | $ 1,000.00 | $ 1,023.90 | $ 1.28 | 0.25 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
37.7 | % | ||
|
Communication Services |
16.3 | |||
|
Consumer Discretionary |
11.7 | |||
|
Health Care |
9.8 | |||
|
Real Estate |
8.5 | |||
|
Consumer Staples |
4.1 | |||
|
Financials |
4.0 | |||
|
Materials |
4.0 | |||
|
Industrials |
3.9 | |||
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Microsoft Corp. |
7.0 | % | ||
|
Amazon.com Inc. |
6.2 | |||
|
Facebook Inc., Class A |
4.0 | |||
|
NVIDIA Corp. |
3.1 | |||
|
Tesla Inc. |
3.0 | |||
|
Visa Inc., Class A |
2.8 | |||
|
PayPal Holdings Inc. |
2.7 | |||
|
Alphabet Inc., Class A |
2.7 | |||
|
Netflix Inc. |
2.6 | |||
|
Alphabet Inc., Class C |
2.6 | |||
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
5 |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Large-Cap Value ETF |
Investment Objective
The iShares Morningstar Large-Cap Value ETF (the “Fund”) seeks to track the investment results of an index composed of large-capitalization U.S. equities that exhibit value characteristics, as represented by the Morningstar® Large Value IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
1.51 | % | (11.63 | )% | 6.01 | % | 8.57 | % | (11.63 | )% | 33.89 | % | 127.61 | % | ||||||||||||||||||
|
Fund Market |
1.25 | (11.97 | ) | 5.93 | 8.53 | (11.97 | ) | 33.36 | 126.69 | |||||||||||||||||||||||
|
Index |
1.61 | (11.43 | ) | 6.28 | 8.85 | (11.43 | ) | 35.58 | 133.43 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
(10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,015.10 | $ 1.27 | $ 1,000.00 | $ 1,023.90 | $ 1.28 | 0.25 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
|
||||
| Sector |
Percent of Total Investments(a) |
|||
|
|
||||
|
Financials |
19.0% | |||
|
Consumer Staples |
16.7 | |||
|
Industrials |
13.7 | |||
|
Health Care |
12.9 | |||
|
Information Technology |
10.5 | |||
|
Communication Services |
10.3 | |||
|
Utilities |
6.2 | |||
|
Energy |
5.7 | |||
|
Consumer Discretionary |
3.2 | |||
|
Materials |
1.2 | |||
|
Real Estate |
0.6 | |||
|
|
||||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
|
||||
| Security |
Percent of
Total Investments(a) |
|||
|
|
||||
|
Johnson & Johnson |
6.0% | |||
|
Procter & Gamble Co. (The) |
5.7 | |||
|
JPMorgan Chase & Co. |
5.0 | |||
|
Verizon Communications Inc. |
3.9 | |||
|
Pfizer Inc. |
3.3 | |||
|
Walmart Inc. |
3.2 | |||
|
Comcast Corp., Class A |
3.2 | |||
|
AT&T Inc. |
3.2 | |||
|
Intel Corp. |
3.1 | |||
|
Bank of America Corp. |
3.0 | |||
|
|
||||
| 6 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Mid-Cap ETF |
Investment Objective
The iShares Morningstar Mid-Cap ETF (the “Fund”) seeks to track the investment results of an index composed of mid-capitalization U.S. equities, as represented by the Morningstar® Mid Core IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
16.18 | % | 0.24 | % | 7.83 | % | 11.45 | % | 0.24 | % | 45.77 | % | 195.72 | % | ||||||||||||||||||
|
Fund Market |
15.74 | (0.10 | ) | 7.75 | 11.41 | (0.10 | ) | 45.26 | 194.72 | |||||||||||||||||||||||
|
Index |
16.33 | 0.49 | 8.10 | 11.71 | 0.49 | 47.58 | 202.72 | |||||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,161.80 | $ 1.36 | $ 1,000.00 | $ 1,023.90 | $ 1.28 | 0.25 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
|
||||
| Sector |
Percent of Total Investments(a) |
|||
|
|
||||
|
Industrials |
18.3% | |||
|
Real Estate |
14.5 | |||
|
Consumer Discretionary |
12.7 | |||
|
Information Technology |
12.6 | |||
|
Financials |
11.2 | |||
|
Health Care |
8.7 | |||
|
Materials |
8.2 | |||
|
Communication Services |
4.5 | |||
|
Consumer Staples |
4.4 | |||
|
Utilities |
3.7 | |||
|
Energy |
1.2 | |||
|
|
||||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
|
||||
| Security |
Percent of Total Investments(a) |
|||
|
|
||||
|
Twitter Inc. |
1.5% | |||
|
TE Connectivity Ltd. |
1.4 | |||
|
Trane Technologies PLC |
1.4 | |||
|
PPG Industries Inc. |
1.4 | |||
|
Ball Corp. |
1.3 | |||
|
T Rowe Price Group Inc. |
1.3 | |||
|
Rockwell Automation Inc. |
1.2 | |||
|
American Water Works Co. Inc. |
1.2 | |||
|
Motorola Solutions Inc. |
1.2 | |||
|
Parker-Hannifin Corp. |
1.2 | |||
|
|
||||
|
F U N D S U M M A R Y |
7 |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Mid-Cap Growth ETF |
Investment Objective
The iShares Morningstar Mid-Cap Growth ETF (the “Fund”) seeks to track the investment results of an index composed of mid-capitalization U.S. equities that exhibit growth characteristics, as represented by the Morningstar® Mid Growth IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
27.02 | % | 31.10 | % | 15.79 | % | 14.42 | % | 31.10 | % | 108.18 | % | 284.62 | % | ||||||||||||||||||
|
Fund Market |
26.95 | 31.07 | 15.79 | 14.42 | 31.07 | 108.13 | 284.48 | |||||||||||||||||||||||||
|
Index |
27.32 | 31.57 | 16.09 | 14.70 | 31.57 | 110.89 | 294.09 | |||||||||||||||||||||||||
Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value
|
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,270.20 | $1.72 | $ 1,000.00 | $ 1,023.70 | $ 1.53 | 0.30 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
|
||||
| Sector |
Percent of Total Investments(a) |
|||
|
|
||||
|
Information Technology |
41.2% | |||
|
Health Care |
22.8 | |||
|
Industrials |
13.2 | |||
|
Consumer Discretionary |
9.5 | |||
|
Communication Services |
5.2 | |||
|
Financials |
3.5 | |||
|
Materials |
1.9 | |||
|
Consumer Staples |
1.1 | |||
|
Energy |
1.0 | |||
|
Real Estate |
0.6 | |||
|
|
||||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
|
||||
| Security |
Percent of
Total Investments(a) |
|||
|
|
||||
|
Zoom Video Communications Inc., Class A |
3.2% | |||
|
Square Inc., Class A |
2.2 | |||
|
MercadoLibre Inc. |
2.1 | |||
|
Twilio Inc., Class A |
1.5 | |||
|
Lululemon Athletica Inc. |
1.4 | |||
|
DocuSign Inc. |
1.4 | |||
|
Workday Inc., Class A |
1.4 | |||
|
Veeva Systems Inc., Class A |
1.4 | |||
|
IDEXX Laboratories Inc. |
1.4 | |||
|
Snap Inc., Class A |
1.4 | |||
|
|
||||
| 8 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Mid-Cap Value ETF |
Investment Objective
The iShares Morningstar Mid-Cap Value ETF (the “Fund”) seeks to track the investment results of an index composed of mid-capitalization U.S. equities that exhibit value characteristics, as represented by the Morningstar® Mid Value IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
12.05 | % | (14.42 | )% | 4.50 | % | 9.00 | % | (14.42 | )% | 24.60 | % | 136.70 | % | ||||||||||||||||||
|
Fund Market |
12.20 | (14.33 | ) | 4.53 | 9.02 | (14.33 | ) | 24.77 | 137.07 | |||||||||||||||||||||||
|
Index |
12.18 | (14.23 | ) | 4.77 | 9.30 | (14.23 | ) | 26.25 | 143.27 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,120.50 | $ 1.60 | $ 1,000.00 | $ 1,023.70 | $ 1.53 | 0.30 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
|
||||
| Sector |
Percent of
Total Investments(a) |
|||
|
|
||||
|
Financials |
19.0% | |||
|
Utilities |
14.2 | |||
|
Industrials |
14.0 | |||
|
Consumer Discretionary |
8.6 | |||
|
Consumer Staples |
7.6 | |||
|
Health Care |
7.3 | |||
|
Materials |
7.1 | |||
|
Information Technology |
6.6 | |||
|
Energy |
6.3 | |||
|
Real Estate |
5.0 | |||
|
Communication Services |
4.3 | |||
|
|
||||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
|
||||
| Security |
Percent of
Total Investments(a) |
|||
|
|
||||
|
Cummins Inc. |
1.6% | |||
|
Johnson Controls International PLC |
1.6 | |||
|
Travelers Companies Inc. (The) |
1.5 | |||
|
Ford Motor Co. |
1.5 | |||
|
Eversource Energy |
1.5 | |||
|
PACCAR Inc. |
1.5 | |||
|
Public Service Enterprise Group Inc. |
1.5 | |||
|
Zimmer Biomet Holdings Inc. |
1.4 | |||
|
Carrier Global Corp. |
1.4 | |||
|
American International Group Inc. |
1.4 | |||
|
|
||||
|
F U N D S U M M A R Y |
9 |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Small-Cap ETF |
Investment Objective
The iShares Morningstar Small-Cap ETF (the “Fund”) seeks to track the investment results of an index composed of small-capitalization U.S. equities, as represented by the Morningstar® Small Core IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
13.04 | % | (9.85 | )% | 5.25 | % | 8.66 | % | (9.85 | )% | 29.13 | % | 129.50 | % | ||||||||||||||||||
|
Fund Market |
12.09 | (10.13 | ) | 5.19 | 8.64 | (10.13 | ) | 28.81 | 129.03 | |||||||||||||||||||||||
|
Index |
13.08 | (9.79 | ) | 5.41 | 8.82 | (9.79 | ) | 30.11 | 132.76 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,130.40 | $ 1.34 | $ 1,000.00 | $ 1,023.90 | $ 1.28 | 0.25 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
|
||||
| Sector |
Percent of Total Investments(a) |
|||
|
|
||||
|
Industrials |
21.3% | |||
|
Financials |
16.8 | |||
|
Consumer Discretionary |
14.3 | |||
|
Real Estate |
13.4 | |||
|
Information Technology |
12.6 | |||
|
Materials |
7.0 | |||
|
Consumer Staples |
4.8 | |||
|
Health Care |
4.0 | |||
|
Utilities |
2.9 | |||
|
Communication Services |
2.4 | |||
|
Energy |
0.5 | |||
|
|
||||
| (a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
|
|
||||
| Security |
Percent of Total Investments(a) |
|||
|
|
||||
|
Nuance Communications Inc. |
1.3% | |||
|
Dunkin’ Brands Group Inc. |
1.2 | |||
|
Sunrun Inc. |
1.2 | |||
|
Williams-Sonoma Inc. |
1.0 | |||
|
Cree Inc. |
1.0 | |||
|
Darling Ingredients Inc. |
1.0 | |||
|
Eaton Vance Corp. |
1.0 | |||
|
CubeSmart |
1.0 | |||
|
HD Supply Holdings Inc. |
0.9 | |||
|
Mosaic Co. (The) |
0.9 | |||
|
|
||||
| 10 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Small-Cap Growth ETF |
Investment Objective
The iShares Morningstar Small-Cap Growth ETF (the “Fund”) seeks to track the investment results of an index composed of small-capitalization U.S. equities that exhibit growth characteristics, as represented by the Morningstar® Small Growth IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
27.41 | % | 22.60 | % | 13.05 | % | 13.08 | % | 22.60 | % | 84.66 | % | 241.97 | % | ||||||||||||||||||
|
Fund Market |
27.44 | 22.68 | 13.08 | 13.10 | 22.68 | 84.88 | 242.46 | |||||||||||||||||||||||||
|
Index |
27.51 | 22.76 | 13.22 | 13.18 | 22.76 | 86.03 | 245.05 | |||||||||||||||||||||||||
Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,274.10 | $ 1.72 | $ 1,000.00 | $ 1,023.70 | $ 1.53 | 0.30 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Information Technology |
28.0 | % | ||
|
Health Care |
25.7 | |||
|
Consumer Discretionary |
15.5 | |||
|
Industrials |
10.9 | |||
|
Communication Services |
5.1 | |||
|
Financials |
4.7 | |||
|
Real Estate |
4.3 | |||
|
Consumer Staples |
3.5 | |||
|
Materials |
1.1 | |||
|
Other (each representing less than 1%) |
1.2 | |||
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Match Group Inc. |
3.4 | % | ||
|
Datadog Inc., Class A |
1.8 | |||
|
SolarEdge Technologies Inc. |
1.4 | |||
|
Enphase Energy Inc. |
1.4 | |||
|
MyoKardia Inc. |
1.3 | |||
|
Carvana Co. |
1.1 | |||
|
Quidel Corp. |
1.1 | |||
|
Five9 Inc. |
1.1 | |||
|
Mirati Therapeutics Inc. |
1.1 | |||
|
Boston Beer Co. Inc. (The), Class A |
1.1 | |||
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
11 |
| Fund Summary as of October 31, 2020 | iShares® Morningstar Small-Cap Value ETF |
Investment Objective
The iShares Morningstar Small-Cap Value ETF (the “Fund”) seeks to track the investment results of an index composed of small-capitalization U.S. equities that exhibit value characteristics, as represented by the Morningstar® Small Value IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
12.53 | % | (16.79 | )% | 0.78 | % | 6.38 | % | (16.79 | )% | 3.98 | % | 85.63 | % | ||||||||||||||||||
|
Fund Market |
12.26 | (17.11 | ) | 0.73 | 6.36 | (17.11 | ) | 3.70 | 85.18 | |||||||||||||||||||||||
|
Index |
12.76 | (16.50 | ) | 1.05 | 6.64 | (16.50 | ) | 5.38 | 90.20 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 13 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ 1,000.00 | $ 1,125.30 | $ 1.61 | $ 1,000.00 | $ 1,023.70 | $ 1.53 | 0.30 | % | |||||||||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 13 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
|
Sector |
|
Percent of
Total Investments |
(a) |
|
|
Financials |
25.4 | % | ||
|
Consumer Discretionary |
18.7 | |||
|
Industrials |
13.3 | |||
|
Information Technology |
8.4 | |||
|
Materials |
7.2 | |||
|
Real Estate |
6.3 | |||
|
Utilities |
6.1 | |||
|
Energy |
5.3 | |||
|
Health Care |
4.9 | |||
|
Consumer Staples |
3.4 | |||
|
Communication Services |
1.0 | |||
TEN LARGEST HOLDINGS
|
Security |
|
Percent of
Total Investments |
(a) |
|
|
Quanta Services Inc. |
1.3 | % | ||
|
Penn National Gaming Inc. |
1.1 | |||
|
L Brands Inc. |
1.1 | |||
|
First Solar Inc. |
1.1 | |||
|
Flex Ltd. |
1.0 | |||
|
Owens Corning |
1.0 | |||
|
Comerica Inc. |
0.9 | |||
|
Steel Dynamics Inc. |
0.9 | |||
|
Sealed Air Corp. |
0.9 | |||
|
Tapestry Inc. |
0.9 | |||
| (a) |
Excludes money market funds. |
| 12 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.
Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.
An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.
As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses – The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes – The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
|
A B O U T F U N D P E R F O R M A N C E / S H A R E H O L D E R E X P E N S E S |
13 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Large-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Food & Staples Retailing — 1.7% |
||||||||
|
Costco Wholesale Corp. |
36,765 | $ | 13,147,899 | |||||
|
|
|
|||||||
| Health Care Equipment & Supplies — 8.2% | ||||||||
|
Abbott Laboratories |
142,115 | 14,937,708 | ||||||
|
Baxter International Inc. |
62,380 | 4,838,817 | ||||||
|
Becton Dickinson and Co. |
29,498 | 6,817,873 | ||||||
|
Boston Scientific Corp.(a) |
154,644 | 5,299,650 | ||||||
|
Danaher Corp. |
54,125 | 12,423,852 | ||||||
|
Medtronic PLC |
113,265 | 11,391,061 | ||||||
|
Stryker Corp. |
33,648 | 6,797,232 | ||||||
|
|
|
|||||||
| 62,506,193 | ||||||||
| Health Care Providers & Services — 6.1% | ||||||||
|
Anthem Inc. |
26,050 | 7,106,440 | ||||||
|
Centene Corp.(a) |
80,606 | 4,763,814 | ||||||
|
Cigna Corp. |
38,608 | 6,446,378 | ||||||
|
Humana Inc. |
14,906 | 5,951,668 | ||||||
|
UnitedHealth Group Inc. |
72,055 | 21,986,863 | ||||||
|
|
|
|||||||
| 46,255,163 | ||||||||
| Hotels, Restaurants & Leisure — 3.5% | ||||||||
|
McDonald’s Corp. |
61,069 | 13,007,697 | ||||||
|
Starbucks Corp. |
106,513 | 9,262,370 | ||||||
|
Yum! Brands Inc. |
45,717 | 4,266,768 | ||||||
|
|
|
|||||||
| 26,536,835 | ||||||||
| Industrial Conglomerates — 1.3% | ||||||||
|
Honeywell International Inc. |
61,530 | 10,149,374 | ||||||
|
|
|
|||||||
| Insurance — 2.2% | ||||||||
|
Aon PLC, Class A |
27,235 | 5,011,512 | ||||||
|
Marsh & McLennan Companies Inc. |
54,403 | 5,628,534 | ||||||
|
Progressive Corp. (The) |
64,146 | 5,895,018 | ||||||
|
|
|
|||||||
| 16,535,064 | ||||||||
| Internet & Direct Marketing Retail — 0.9% | ||||||||
|
Booking Holdings Inc.(a) |
4,078 | 6,616,555 | ||||||
|
|
|
|||||||
| IT Services — 4.6% | ||||||||
|
Accenture PLC, Class A |
53,005 | 11,497,315 | ||||||
|
Cognizant Technology Solutions Corp., Class A |
70,962 | 5,068,106 | ||||||
|
Fidelity National Information Services Inc. |
58,081 | 7,236,312 | ||||||
|
Fiserv Inc.(a) |
62,654 | 5,981,577 | ||||||
|
Global Payments Inc. |
34,265 | 5,404,961 | ||||||
|
|
|
|||||||
| 35,188,271 | ||||||||
| Life Sciences Tools & Services — 2.6% | ||||||||
|
IQVIA Holdings Inc.(a) |
27,589 | 4,248,430 | ||||||
|
Thermo Fisher Scientific Inc. |
32,186 | 15,227,840 | ||||||
|
|
|
|||||||
| 19,476,270 | ||||||||
| Multi-Utilities — 0.7% | ||||||||
|
Sempra Energy |
39,406 | 4,939,936 | ||||||
|
|
|
|||||||
| Multiline Retail — 0.8% | ||||||||
|
Dollar General Corp. |
28,474 | 5,942,809 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 0.4% | ||||||||
|
EOG Resources Inc. |
99,221 | 3,397,327 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 4.6% | ||||||||
|
Bristol-Myers Squibb Co. |
192,136 | 11,230,349 | ||||||
|
Eli Lilly & Co. |
69,509 | 9,068,144 | ||||||
|
Merck & Co. Inc. |
198,801 | 14,951,824 | ||||||
|
|
|
|||||||
| 35,250,317 | ||||||||
| 14 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 0.1% |
||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(c) |
773,000 | $ | 773,000 | |||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.1%
|
|
773,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 99.9%
|
|
759,594,632 | ||||||
|
Other Assets, Less Liabilities — 0.1% |
|
550,099 | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 760,144,731 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares(a) |
$ | 3,078,621 | $ | — | $ | (3,077,446 | )(b) | $ | 923 | $ | (2,098 | ) | $ | — | — | $ | 4,835 | (c) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,933,000 | — | (1,160,000 | )(b) | — | — | 773,000 | 773,000 | 937 | — | ||||||||||||||||||||||||||
|
BlackRock Inc. |
7,133,988 | 2,263,328 | (2,649,817 | ) | 450,542 | 1,132,176 | 8,330,217 | 13,902 | 117,844 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 451,465 | $ | 1,130,078 | $ | 9,103,217 | $ | 123,616 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
As of period end, the entity is no longer held. |
| (b) |
Represents net amount purchased (sold). |
| (c) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
7 | 12/18/20 | $ | 1,143 | $ | (28,333 | ) | |||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
15 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 28,333 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 450,900 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (316,939 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,958,693 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 758,821,632 | $ | — | $ | — | $ | 758,821,632 | ||||||||
|
Money Market Funds |
773,000 | — | — | 773,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 759,594,632 | $ | — | $ | — | $ | 759,594,632 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (28,333 | ) | $ | — | $ | — | $ | (28,333 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 16 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Large-Cap Growth ETF (Percentages shown are based on Net Assets) |
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
17 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap Growth ETF |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 33,714,086 | $ | — | $ | (30,348,057 | )(a) | $ | 16,805 | $ | (23,613 | ) | $ | 3,359,221 | 3,356,871 | $ | 80,681 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
2,337,000 | — | (510,000 | )(a) | — | — | 1,827,000 | 1,827,000 | 1,350 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 16,805 | $ | (23,613 | ) | $ | 5,186,221 | $ | 82,031 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
4 | 12/18/20 | $ | 653 | $ | 5,018 | ||||||||||
|
S&P Select Sector Consumer Discretionary E-Mini Index |
2 | 12/18/20 | 288 | (1,824 | ) | |||||||||||
|
S&P Select Sector Technology E-Mini Index |
5 | 12/18/20 | 558 | (5,782 | ) | |||||||||||
|
|
|
|||||||||||||||
| (2,588 | ) | |||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 5,018 | ||
|
|
|
|||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
7,606 | |||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 633,310 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (377,462 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
| 18 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap Growth ETF |
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,680,573 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,709,162,609 | $ | — | $ | — | $ | 1,709,162,609 | ||||||||
|
Money Market Funds |
5,186,221 | — | — | 5,186,221 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,714,348,830 | $ | — | $ | — | $ | 1,714,348,830 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 5,018 | $ | — | $ | — | $ | 5,018 | ||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
(7,606 | ) | — | — | (7,606 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | (2,588 | ) | $ | — | $ | — | $ | (2,588 | ) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
19 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Large-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Food & Staples Retailing (continued) | ||||||||
|
Walmart Inc. |
101,273 | $ | 14,051,629 | |||||
|
|
|
|||||||
| 17,888,334 | ||||||||
| Food Products — 2.2% | ||||||||
|
General Mills Inc. |
44,526 | 2,632,377 | ||||||
|
Kraft Heinz Co. (The) |
47,304 | 1,447,029 | ||||||
|
Mondelez International Inc., Class A |
104,198 | 5,534,998 | ||||||
|
|
|
|||||||
| 9,614,404 | ||||||||
| Health Care Providers & Services — 1.7% | ||||||||
|
CVS Health Corp. |
95,474 | 5,355,137 | ||||||
|
HCA Healthcare Inc. |
19,213 | 2,381,259 | ||||||
|
|
|
|||||||
| 7,736,396 | ||||||||
| Hotels, Restaurants & Leisure — 0.7% | ||||||||
|
Las Vegas Sands Corp. |
23,978 | 1,152,383 | ||||||
|
Marriott International Inc./MD, Class A |
19,415 | 1,803,265 | ||||||
|
|
|
|||||||
| 2,955,648 | ||||||||
| Household Products — 7.5% | ||||||||
|
Colgate-Palmolive Co. |
62,557 | 4,935,122 | ||||||
|
Kimberly-Clark Corp. |
24,860 | 3,296,187 | ||||||
|
Procter & Gamble Co. (The) |
181,580 | 24,894,618 | ||||||
|
|
|
|||||||
| 33,125,927 | ||||||||
| Industrial Conglomerates — 2.6% | ||||||||
|
3M Co. |
42,016 | 6,720,879 | ||||||
|
General Electric Co. |
638,690 | 4,739,080 | ||||||
|
|
|
|||||||
| 11,459,959 | ||||||||
| Insurance — 2.3% | ||||||||
|
Aflac Inc. |
48,402 | 1,643,248 | ||||||
|
Allstate Corp. (The) |
22,802 | 2,023,678 | ||||||
|
Chubb Ltd. |
32,902 | 4,274,299 | ||||||
|
MetLife Inc. |
56,324 | 2,131,863 | ||||||
|
|
|
|||||||
| 10,073,088 | ||||||||
| Internet & Direct Marketing Retail — 0.5% | ||||||||
|
eBay Inc. |
48,451 | 2,307,721 | ||||||
|
|
|
|||||||
| IT Services — 1.6% | ||||||||
|
International Business Machines Corp. |
64,958 | 7,253,210 | ||||||
|
|
|
|||||||
| Machinery — 3.5% | ||||||||
|
Caterpillar Inc. |
39,501 | 6,203,632 | ||||||
|
Deere & Co. |
22,863 | 5,164,980 | ||||||
|
Illinois Tool Works Inc. |
20,972 | 4,107,996 | ||||||
|
|
|
|||||||
| 15,476,608 | ||||||||
| Media — 3.2% | ||||||||
|
Comcast Corp., Class A |
332,484 | 14,044,124 | ||||||
|
|
|
|||||||
| Multi-Utilities — 2.1% | ||||||||
|
Consolidated Edison Inc. |
24,419 | 1,916,647 | ||||||
|
Dominion Energy Inc. |
61,295 | 4,924,440 | ||||||
|
WEC Energy Group Inc. |
23,025 | 2,315,164 | ||||||
|
|
|
|||||||
| 9,156,251 | ||||||||
| Multiline Retail — 1.3% | ||||||||
|
Target Corp. |
36,521 | 5,559,227 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 5.7% | ||||||||
|
Chevron Corp. |
140,403 | 9,758,008 | ||||||
|
ConocoPhillips |
78,167 | 2,237,140 | ||||||
|
Exxon Mobil Corp. |
308,385 | 10,059,519 | ||||||
|
Kinder Morgan Inc./DE |
142,114 | 1,691,157 | ||||||
|
Phillips 66 |
31,881 | 1,487,567 | ||||||
|
|
|
|||||||
| 25,233,391 | ||||||||
| 20 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Pharmaceuticals — 9.2% |
||||||||
|
Johnson & Johnson |
192,024 | $ | 26,328,411 | |||||
|
Pfizer Inc. |
405,290 | 14,379,689 | ||||||
|
|
|
|||||||
| 40,708,100 | ||||||||
| Road & Rail — 1.9% | ||||||||
|
CSX Corp. |
55,825 | 4,406,825 | ||||||
|
Norfolk Southern Corp. |
18,596 | 3,888,796 | ||||||
|
|
|
|||||||
| 8,295,621 | ||||||||
| Semiconductors & Semiconductor Equipment — 6.4% | ||||||||
|
Broadcom Inc. |
29,333 | 10,255,697 | ||||||
|
Intel Corp. |
310,191 | 13,735,257 | ||||||
|
Micron Technology Inc.(a) |
80,984 | 4,076,735 | ||||||
|
|
|
|||||||
| 28,067,689 | ||||||||
| Tobacco — 2.9% | ||||||||
|
Altria Group Inc. |
135,587 | 4,891,979 | ||||||
|
Philip Morris International Inc. |
113,580 | 8,066,452 | ||||||
|
|
|
|||||||
| 12,958,431 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.6%
|
440,243,071 | |||||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 0.1% |
||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(b)(c) |
420,000 | $ | 420,000 | |||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.1%
|
420,000 | |||||||
|
|
|
|||||||
|
Total Investments in Securities — 99.7%
|
440,663,071 | |||||||
|
Other Assets, Less Liabilities — 0.3% |
1,257,045 | |||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 441,920,116 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
Affiliate of the Fund. |
| (c) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL
Agency
|
$ | — | $ | — | $ | 0 | (b) | $ | — | $ | — | $ | — | — | $ | 88 | (c) | $ | — | |||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
1,210,000 | — | (790,000 | )(b) | — | — | 420,000 | 420,000 | 571 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | — | $ | — | $ | 420,000 | $ | 659 | $ | — | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
As of period end, the entity is no longer held. |
| (b) |
Represents net amount purchased (sold). |
| (c) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
2 | 12/18/20 | $ | 327 | $ | (9,098 | ) | |||||||||
|
S&P Select Sector Consumer Staples E-Mini Index |
8 | 12/18/20 | 499 | (16,038 | ) | |||||||||||
|
S&P Select Sector Financial E-Mini Index |
11 | 12/18/20 | 805 | (27,487 | ) | |||||||||||
|
|
|
|||||||||||||||
| (52,623 | ) | |||||||||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
21 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Large-Cap Value ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 52,623 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 409,359 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (81,580 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,194,314 | ||
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 440,243,071 | $ | — | $ | — | $ | 440,243,071 | ||||||||
|
Money Market Funds |
420,000 | — | — | 420,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 440,663,071 | $ | — | $ | — | $ | 440,663,071 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (52,623 | ) | $ | — | $ | — | $ | (52,623 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 22 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Mid-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Aerospace & Defense — 0.3% | ||||||||
|
Huntington Ingalls Industries Inc. |
11,775 | $ | 1,736,577 | |||||
|
|
|
|||||||
| Air Freight & Logistics — 1.6% | ||||||||
|
CH Robinson Worldwide Inc. |
39,200 | 3,466,456 | ||||||
|
Expeditors International of Washington Inc. |
48,747 | 4,307,772 | ||||||
|
XPO Logistics Inc.(a)(b) |
26,553 | 2,389,770 | ||||||
|
|
|
|||||||
| 10,163,998 | ||||||||
| Auto Components — 1.5% | ||||||||
|
Aptiv PLC |
78,510 | 7,575,430 | ||||||
|
Gentex Corp. |
71,461 | 1,977,326 | ||||||
|
|
|
|||||||
| 9,552,756 | ||||||||
| Banks — 2.1% | ||||||||
|
Commerce Bancshares Inc. |
29,185 | 1,816,766 | ||||||
|
First Republic Bank/CA |
50,043 | 6,312,424 | ||||||
|
Signature Bank/New York NY |
15,515 | 1,252,681 | ||||||
|
SVB Financial Group(a) |
15,050 | 4,375,035 | ||||||
|
|
|
|||||||
| 13,756,906 | ||||||||
| Biotechnology — 2.0% | ||||||||
|
Alexion Pharmaceuticals Inc.(a) |
63,725 | 7,337,297 | ||||||
|
Moderna Inc.(a) |
87,192 | 5,882,844 | ||||||
|
|
|
|||||||
| 13,220,141 | ||||||||
| Building Products — 3.2% | ||||||||
|
A O Smith Corp. |
39,360 | 2,034,518 | ||||||
|
Allegion PLC |
26,817 | 2,641,474 | ||||||
|
Lennox International Inc. |
10,121 | 2,749,471 | ||||||
|
Masco Corp. |
76,041 | 4,075,798 | ||||||
|
Trane Technologies PLC |
69,592 | 9,238,338 | ||||||
|
|
|
|||||||
| 20,739,599 | ||||||||
| Capital Markets — 5.2% | ||||||||
|
Ameriprise Financial Inc. |
34,968 | 5,623,903 | ||||||
|
Apollo Global Management Inc. |
60,651 | 2,235,596 | ||||||
|
KKR & Co. Inc. |
162,571 | 5,551,800 | ||||||
|
Nasdaq Inc. |
33,431 | 4,044,817 | ||||||
|
Northern Trust Corp. |
60,503 | 4,735,570 | ||||||
|
Raymond James Financial Inc. |
35,493 | 2,713,085 | ||||||
|
T Rowe Price Group Inc. |
65,996 | 8,359,053 | ||||||
|
|
|
|||||||
| 33,263,824 | ||||||||
| Chemicals — 4.3% | ||||||||
|
CF Industries Holdings Inc. |
62,186 | 1,716,955 | ||||||
|
Corteva Inc. |
217,647 | 7,177,998 | ||||||
|
FMC Corp. |
37,671 | 3,870,319 | ||||||
|
International Flavors & Fragrances Inc.(b) |
31,091 | 3,191,802 | ||||||
|
PPG Industries Inc. |
68,611 | 8,900,219 | ||||||
|
RPM International Inc. |
37,789 | 3,199,595 | ||||||
|
|
|
|||||||
| 28,056,888 | ||||||||
| Commercial Services & Supplies — 0.8% | ||||||||
|
Republic Services Inc. |
61,117 | 5,388,686 | ||||||
|
|
|
|||||||
| Communications Equipment — 1.6% | ||||||||
|
F5 Networks Inc.(a) |
17,786 | 2,364,471 | ||||||
|
Motorola Solutions Inc. |
49,366 | 7,802,790 | ||||||
|
|
|
|||||||
| 10,167,261 | ||||||||
| Construction & Engineering — 0.6% | ||||||||
|
Jacobs Engineering Group Inc. |
37,858 | 3,596,510 | ||||||
|
|
|
|||||||
| Containers & Packaging — 2.4% | ||||||||
|
AptarGroup Inc. |
18,746 | 2,138,731 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
23 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
IT Services — 2.4% |
||||||||
|
CACI International Inc., Class A(a) |
7,303 | $ | 1,522,895 | |||||
|
Genpact Ltd. |
51,584 | 1,772,942 | ||||||
|
Leidos Holdings Inc. |
38,862 | 3,225,546 | ||||||
|
Paychex Inc. |
93,151 | 7,661,670 | ||||||
|
WEX Inc.(a)(b) |
12,821 | 1,622,497 | ||||||
|
|
|
|||||||
| 15,805,550 | ||||||||
| Leisure Products — 0.5% | ||||||||
|
Hasbro Inc. |
37,051 | 3,064,859 | ||||||
|
|
|
|||||||
| Life Sciences Tools & Services — 2.5% | ||||||||
|
Mettler-Toledo International Inc.(a)(b) |
6,970 | 6,955,433 | ||||||
|
PerkinElmer Inc. |
32,510 | 4,211,670 | ||||||
|
PPD Inc.(a) |
31,302 | 1,029,210 | ||||||
|
Waters Corp.(a) |
18,005 | 4,011,874 | ||||||
|
|
|
|||||||
| 16,208,187 | ||||||||
| Machinery — 5.3% | ||||||||
|
Donaldson Co. Inc. |
36,672 | 1,741,920 | ||||||
|
Dover Corp. |
41,859 | 4,634,210 | ||||||
|
Fortive Corp. |
98,004 | 6,037,046 | ||||||
|
Ingersoll Rand Inc.(a) |
107,922 | 3,770,795 | ||||||
|
Otis Worldwide Corp. |
118,363 | 7,253,284 | ||||||
|
Parker-Hannifin Corp. |
37,380 | 7,788,497 | ||||||
|
Westinghouse Air Brake Technologies Corp. |
52,010 | 3,084,193 | ||||||
|
|
|
|||||||
| 34,309,945 | ||||||||
| Media — 1.9% | ||||||||
|
Altice USA Inc., Class A(a) |
96,128 | 2,590,649 | ||||||
|
Liberty Broadband Corp., Class A(a) |
6,782 | 953,210 | ||||||
|
Liberty Broadband Corp., Class C, NVS(a) |
44,480 | 6,303,261 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class A(a) |
24,181 | 835,937 | ||||||
|
Liberty Media Corp.-Liberty SiriusXM, Class C, NVS(a) |
50,651 | 1,752,525 | ||||||
|
|
|
|||||||
| 12,435,582 | ||||||||
| Metals & Mining — 1.3% | ||||||||
|
Freeport-McMoRan Inc. |
422,234 | 7,321,537 | ||||||
|
Southern Copper Corp. |
24,632 | 1,289,239 | ||||||
|
|
|
|||||||
| 8,610,776 | ||||||||
| Multi-Utilities — 0.8% | ||||||||
|
CMS Energy Corp. |
83,236 | 5,271,336 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 0.8% | ||||||||
|
Diamondback Energy Inc. |
45,716 | 1,186,788 | ||||||
|
Pioneer Natural Resources Co. |
47,763 | 3,800,024 | ||||||
|
|
|
|||||||
| 4,986,812 | ||||||||
| Pharmaceuticals — 0.5% | ||||||||
|
Elanco Animal Health Inc.(a) |
95,104 | 2,949,175 | ||||||
|
|
|
|||||||
| Professional Services — 0.7% | ||||||||
|
Equifax Inc. |
35,314 | 4,823,892 | ||||||
|
|
|
|||||||
| Real Estate Management & Development — 0.8% | ||||||||
|
CBRE Group Inc., Class A(a) |
97,482 | 4,913,093 | ||||||
|
|
|
|||||||
| Road & Rail — 1.7% | ||||||||
|
JB Hunt Transport Services Inc. |
24,234 | 2,950,247 | ||||||
|
Kansas City Southern |
27,432 | 4,831,873 | ||||||
|
Knight-Swift Transportation Holdings Inc. |
36,653 | 1,392,447 | ||||||
|
Lyft Inc., Class A(a)(b) |
70,567 | 1,611,045 | ||||||
|
|
|
|||||||
| 10,785,612 | ||||||||
| Semiconductors & Semiconductor Equipment — 5.1% | ||||||||
|
Marvell Technology Group Ltd. |
193,437 | 7,255,822 | ||||||
|
Maxim Integrated Products Inc. |
77,624 | 5,406,512 | ||||||
| 24 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Semiconductors & Semiconductor Equipment (continued) |
|
|||||||
|
Microchip Technology Inc. |
73,401 | $ | 7,712,977 | |||||
|
MKS Instruments Inc. |
16,029 | 1,737,383 | ||||||
|
Qorvo Inc.(a) |
33,214 | 4,230,135 | ||||||
|
Skyworks Solutions Inc. |
48,566 | 6,861,890 | ||||||
|
|
|
|||||||
| 33,204,719 | ||||||||
| Software — 1.2% | ||||||||
|
Citrix Systems Inc. |
35,917 | 4,068,318 | ||||||
|
NortonLifeLock Inc. |
171,835 | 3,534,646 | ||||||
|
SolarWinds Corp.(a) |
20,749 | 423,902 | ||||||
|
|
|
|||||||
| 8,026,866 | ||||||||
| Specialty Retail — 3.6% | ||||||||
|
Advance Auto Parts Inc. |
20,102 | 2,960,623 | ||||||
|
AutoZone Inc.(a) |
6,792 | 7,668,032 | ||||||
|
CarMax Inc.(a) |
47,415 | 4,098,553 | ||||||
|
Tiffany & Co. |
31,406 | 4,109,161 | ||||||
|
Tractor Supply Co. |
33,792 | 4,501,432 | ||||||
|
|
|
|||||||
| 23,337,801 | ||||||||
| Trading Companies & Distributors — 1.6% | ||||||||
|
United Rentals Inc.(a) |
20,957 | 3,736,423 | ||||||
|
Watsco Inc. |
9,543 | 2,138,968 | ||||||
|
WW Grainger Inc. |
13,084 | 4,579,662 | ||||||
|
|
|
|||||||
| 10,455,053 | ||||||||
| Water Utilities — 1.6% | ||||||||
|
American Water Works Co. Inc. |
52,685 | 7,929,619 | ||||||
|
Essential Utilities Inc. |
64,864 | 2,672,397 | ||||||
|
|
|
|||||||
| 10,602,016 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
644,665,803 | |||||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
|
|
||||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 1.2% |
||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
6,639,928 | $ | 6,644,576 | |||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
822,000 | 822,000 | ||||||
|
|
|
|||||||
| 7,466,576 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.2%
|
|
7,466,576 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.0%
|
|
652,132,379 | ||||||
|
Other Assets, Less Liabilities — (1.0)% |
|
(6,463,185 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 645,669,194 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 14,992,505 | $ | — | $ | (8,345,151 | )(a) | $ | 20,361 | $ | (23,139 | ) | $ | 6,644,576 | 6,639,928 | $ | 32,235 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
822,000 | — | 0 | (a) | — | — | 822,000 | 822,000 | 730 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 20,361 | $ | (23,139 | ) | $ | 7,466,576 | $ | 32,965 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
25 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap ETF |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional
Amount
|
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P 500 E-Mini Index |
2 | 12/18/20 | $ | 326 | $ | (7,982 | ) | |||||||||
|
S&P MidCap 400 E-Mini Index |
3 | 12/18/20 | 569 | (30,922 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (38,904 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 38,904 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 292,758 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (129,732 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,141,620 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 644,665,803 | $ | — | $ | — | $ | 644,665,803 | ||||||||
|
Money Market Funds |
7,466,576 | — | — | 7,466,576 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 652,132,379 | $ | — | $ | — | $ | 652,132,379 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (38,904 | ) | $ | — | $ | — | $ | (38,904 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 26 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Mid-Cap Growth ETF (Percentages shown are based on Net Assets) |
|
S C H E D U L E O F I N V E S T M E N T S |
27 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Internet & Direct Marketing Retail — 3.2% |
||||||||
|
Etsy Inc.(b) |
52,127 | $ | 6,338,122 | |||||
|
Expedia Group Inc. |
59,281 | 5,581,306 | ||||||
|
MercadoLibre Inc.(b) |
19,978 | 24,254,291 | ||||||
|
|
|
|||||||
| 36,173,719 | ||||||||
| IT Services — 10.6% | ||||||||
|
Akamai Technologies Inc.(b) |
71,076 | 6,760,749 | ||||||
|
Black Knight Inc.(b) |
68,597 | 6,033,106 | ||||||
|
Booz Allen Hamilton Holding Corp. |
60,197 | 4,725,465 | ||||||
|
Broadridge Financial Solutions Inc. |
50,307 | 6,922,243 | ||||||
|
EPAM Systems Inc.(b) |
24,399 | 7,538,071 | ||||||
|
FleetCor Technologies Inc.(b) |
36,717 | 8,111,152 | ||||||
|
Gartner Inc.(b) |
38,981 | 4,681,618 | ||||||
|
GoDaddy Inc., Class A(b) |
72,875 | 5,155,178 | ||||||
|
Jack Henry & Associates Inc. |
33,480 | 4,963,410 | ||||||
|
MongoDB Inc.(b) |
22,087 | 5,046,217 | ||||||
|
Okta Inc.(b) |
50,732 | 10,645,096 | ||||||
|
Square Inc., Class A(b) |
162,196 | 25,120,917 | ||||||
|
Twilio Inc., Class A(b) |
60,022 | 16,744,337 | ||||||
|
VeriSign Inc.(b) |
44,152 | 8,419,786 | ||||||
|
|
|
|||||||
| 120,867,345 | ||||||||
| Life Sciences Tools & Services — 3.6% | ||||||||
|
Agilent Technologies Inc. |
134,682 | 13,749,685 | ||||||
|
Avantor Inc.(b) |
193,958 | 4,513,403 | ||||||
|
Bio-Rad Laboratories Inc., Class A(b) |
9,344 | 5,479,509 | ||||||
|
Bio-Techne Corp. |
16,840 | 4,250,584 | ||||||
|
Bruker Corp. |
44,795 | 1,905,579 | ||||||
|
Charles River Laboratories International Inc.(b) |
21,702 | 4,941,546 | ||||||
|
PRA Health Sciences Inc.(b) |
27,885 | 2,717,114 | ||||||
|
Repligen Corp.(b) |
21,319 | 3,551,106 | ||||||
|
|
|
|||||||
| 41,108,526 | ||||||||
| Machinery — 2.2% | ||||||||
|
Graco Inc. |
72,826 | 4,507,929 | ||||||
|
IDEX Corp. |
32,986 | 5,620,485 | ||||||
|
Nordson Corp. |
23,577 | 4,560,499 | ||||||
|
Toro Co. (The) |
46,872 | 3,848,191 | ||||||
|
Xylem Inc./NY |
78,613 | 6,850,337 | ||||||
|
|
|
|||||||
| 25,387,441 | ||||||||
| Media — 0.4% | ||||||||
|
Cable One Inc. |
2,367 | 4,099,313 | ||||||
|
|
|
|||||||
| Metals & Mining — 0.3% | ||||||||
|
Royal Gold Inc. |
28,641 | 3,402,837 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 1.0% | ||||||||
|
Cabot Oil & Gas Corp. |
173,968 | 3,094,890 | ||||||
|
Cheniere Energy Inc.(b) |
100,277 | 4,800,260 | ||||||
|
Concho Resources Inc. |
85,929 | 3,566,913 | ||||||
|
|
|
|||||||
| 11,462,063 | ||||||||
| Pharmaceuticals — 1.2% | ||||||||
|
Catalent Inc.(b) |
71,702 | 6,293,285 | ||||||
|
Horizon Therapeutics PLC(b) |
92,351 | 6,919,860 | ||||||
|
|
|
|||||||
| 13,213,145 | ||||||||
| Professional Services — 4.3% | ||||||||
|
Clarivate PLC, NVS(a)(b) |
115,005 | 3,191,389 | ||||||
|
CoStar Group Inc.(b) |
17,197 | 14,163,621 | ||||||
|
IHS Markit Ltd. |
162,942 | 13,177,120 | ||||||
|
TransUnion |
83,043 | 6,615,205 | ||||||
|
Verisk Analytics Inc. |
70,937 | 12,624,658 | ||||||
|
|
|
|||||||
| 49,771,993 | ||||||||
| Security | Shares | Value | ||||||
|
Road & Rail — 0.7% |
||||||||
|
Old Dominion Freight Line Inc. |
42,029 | $ | 8,001,061 | |||||
|
|
|
|||||||
| Semiconductors & Semiconductor Equipment — 4.1% | ||||||||
|
Entegris Inc. |
58,894 | 4,403,504 | ||||||
|
KLA Corp. |
67,912 | 13,390,888 | ||||||
|
Monolithic Power Systems Inc. |
18,443 | 5,894,383 | ||||||
|
Teradyne Inc. |
72,529 | 6,371,673 | ||||||
|
Universal Display Corp.(a) |
18,714 | 3,711,173 | ||||||
|
Xilinx Inc. |
106,726 | 12,667,309 | ||||||
|
|
|
|||||||
| 46,438,930 | ||||||||
| Software — 22.9% | ||||||||
|
Anaplan Inc.(b) |
60,049 | 3,323,712 | ||||||
|
ANSYS Inc.(b) |
37,476 | 11,406,570 | ||||||
|
Aspen Technology Inc.(b) |
29,576 | 3,247,741 | ||||||
|
Avalara Inc.(b) |
36,466 | 5,435,257 | ||||||
|
Cadence Design Systems Inc.(b) |
121,788 | 13,319,954 | ||||||
|
Ceridian HCM Holding Inc.(b) |
56,710 | 4,889,536 | ||||||
|
Coupa Software Inc.(b) |
29,301 | 7,843,878 | ||||||
|
Crowdstrike Holdings Inc., Class A(b) |
66,056 | 8,180,375 | ||||||
|
DocuSign Inc.(b) |
80,164 | 16,213,169 | ||||||
|
Dynatrace Inc.(b) |
79,683 | 2,813,607 | ||||||
|
Fair Isaac Corp.(b) |
12,668 | 4,958,889 | ||||||
|
Fortinet Inc.(b) |
58,677 | 6,476,180 | ||||||
|
Guidewire Software Inc.(a)(b) |
36,335 | 3,492,157 | ||||||
|
HubSpot Inc.(b) |
18,710 | 5,427,210 | ||||||
|
Palo Alto Networks Inc.(b) |
42,140 | 9,320,947 | ||||||
|
Paycom Software Inc.(b) |
21,389 | 7,787,521 | ||||||
|
Paylocity Holding Corp.(b) |
16,189 | 3,003,383 | ||||||
|
Pegasystems Inc. |
17,213 | 1,994,642 | ||||||
|
Proofpoint Inc.(b) |
25,200 | 2,412,648 | ||||||
|
PTC Inc.(b) |
45,652 | 3,829,290 | ||||||
|
RealPage Inc.(a)(b) |
38,733 | 2,157,041 | ||||||
|
RingCentral Inc., Class A(b) |
34,138 | 8,819,211 | ||||||
|
Slack Technologies Inc., Class A(a)(b) |
188,977 | 4,834,032 | ||||||
|
Smartsheet Inc., Class A(b) |
49,054 | 2,445,342 | ||||||
|
Splunk Inc.(b) |
69,400 | 13,743,976 | ||||||
|
SS&C Technologies Holdings Inc. |
97,893 | 5,797,223 | ||||||
|
Synopsys Inc.(b) |
66,296 | 14,178,063 | ||||||
|
Trade Desk Inc. (The), Class A(b) |
18,230 | 10,326,383 | ||||||
|
Tyler Technologies Inc.(b) |
17,579 | 6,757,016 | ||||||
|
VMware Inc., Class A(b) |
35,173 | 4,527,820 | ||||||
|
Workday Inc., Class A(b) |
76,010 | 15,971,221 | ||||||
|
Zendesk Inc.(b) |
50,423 | 5,593,928 | ||||||
|
Zoom Video Communications Inc., Class A(b) |
79,551 | 36,665,851 | ||||||
|
Zscaler Inc.(b) |
31,359 | 4,256,984 | ||||||
|
|
|
|||||||
| 261,450,757 | ||||||||
| Specialty Retail — 0.9% | ||||||||
|
Burlington Stores Inc.(b) |
28,765 | 5,568,329 | ||||||
|
Ulta Beauty Inc.(b) |
24,604 | 5,087,369 | ||||||
|
|
|
|||||||
| 10,655,698 | ||||||||
| Textiles, Apparel & Luxury Goods — 2.3% | ||||||||
|
Lululemon Athletica Inc.(b) |
51,760 | 16,526,451 | ||||||
|
VF Corp. |
139,576 | 9,379,507 | ||||||
|
|
|
|||||||
| 25,905,958 | ||||||||
| Trading Companies & Distributors — 0.9% | ||||||||
|
Fastenal Co. |
250,583 | 10,832,703 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
1,141,631,601 | |||||||
|
|
|
|||||||
| 28 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 3.2% |
||||||||
|
BlackRock Cash Funds: Institutional,
|
35,133,847 | $ | 35,158,441 | |||||
|
BlackRock Cash Funds: Treasury,
|
1,160,000 | 1,160,000 | ||||||
|
|
|
|||||||
| 36,318,441 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 3.2%
|
|
36,318,441 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 103.1%
|
|
1,177,950,042 | ||||||
|
Other Assets, Less Liabilities — (3.1)% |
|
(35,073,401 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,142,876,641 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|
||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 50,439,366 | $ | — | $ | (15,255,755 | )(a) | $ | 5,484 | $ | (30,654 | ) | $ | 35,158,441 | 35,133,847 | $ | 126,292 | (b) | $ | — | ||||||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
— | 1,160,000 | (a) | — | — | — | 1,160,000 | 1,160,000 | 408 | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| $ | 5,484 | $ | (30,654 | ) | $ | 36,318,441 | $ | 126,700 | $ | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional
Amount
|
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
Russell 2000 E-Mini Index |
6 | 12/18/20 | $ | 461 | $ | (14,428 | ) | |||||||||
|
S&P Select Sector Technology E-Mini Index |
5 | 12/18/20 | 557 | (32,862 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (47,290 | ) | ||||||||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
29 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Growth ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 47,290 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 157,305 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (96,122 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 722,093 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,141,631,601 | $ | — | $ | — | $ | 1,141,631,601 | ||||||||
|
Money Market Funds |
36,318,441 | — | — | 36,318,441 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,177,950,042 | $ | — | $ | — | $ | 1,177,950,042 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (47,290 | ) | $ | — | $ | — | $ | (47,290 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 30 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Mid-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Aerospace & Defense — 0.8% | ||||||||
|
Howmet Aerospace Inc. |
64,470 | $ | 1,112,108 | |||||
|
Textron Inc. |
37,454 | 1,340,853 | ||||||
|
|
|
|||||||
| 2,452,961 | ||||||||
| Airlines — 3.0% | ||||||||
|
American Airlines Group Inc.(a) |
83,527 | 942,185 | ||||||
|
Delta Air Lines Inc. |
104,909 | 3,214,412 | ||||||
|
Southwest Airlines Co. |
97,017 | 3,835,082 | ||||||
|
United Airlines Holdings Inc.(a)(b) |
47,890 | 1,621,555 | ||||||
|
|
|
|||||||
| 9,613,234 | ||||||||
| Auto Components — 1.1% | ||||||||
|
Autoliv Inc. |
12,910 | 978,578 | ||||||
|
BorgWarner Inc. |
40,224 | 1,407,035 | ||||||
|
Lear Corp. |
8,959 | 1,082,337 | ||||||
|
|
|
|||||||
| 3,467,950 | ||||||||
| Automobiles — 1.5% | ||||||||
|
Ford Motor Co. |
642,674 | 4,967,870 | ||||||
|
|
|
|||||||
| Banks — 4.4% | ||||||||
|
Citizens Financial Group Inc. |
70,229 | 1,913,740 | ||||||
|
Fifth Third Bancorp |
117,143 | 2,720,060 | ||||||
|
Huntington Bancshares Inc./OH |
167,419 | 1,747,854 | ||||||
|
KeyCorp. |
160,565 | 2,084,134 | ||||||
|
M&T Bank Corp. |
21,103 | 2,185,849 | ||||||
|
People’s United Financial Inc. |
69,767 | 744,414 | ||||||
|
Regions Financial Corp. |
157,958 | 2,100,841 | ||||||
|
Zions Bancorp NA |
26,932 | 869,096 | ||||||
|
|
|
|||||||
| 14,365,988 | ||||||||
| Beverages — 0.3% | ||||||||
|
Molson Coors Beverage Co., Class B |
30,887 | 1,089,076 | ||||||
|
|
|
|||||||
| Building Products — 3.5% | ||||||||
|
Carrier Global Corp. |
133,911 | 4,471,288 | ||||||
|
Fortune Brands Home & Security Inc. |
22,731 | 1,838,256 | ||||||
|
Johnson Controls International PLC |
122,374 | 5,165,407 | ||||||
|
|
|
|||||||
| 11,474,951 | ||||||||
| Capital Markets — 1.4% | ||||||||
|
Carlyle Group Inc. (The) |
18,935 | 471,860 | ||||||
|
Franklin Resources Inc. |
43,934 | 823,763 | ||||||
|
State Street Corp. |
57,957 | 3,413,667 | ||||||
|
|
|
|||||||
| 4,709,290 | ||||||||
| Chemicals — 2.7% | ||||||||
|
Albemarle Corp. |
17,503 | 1,631,455 | ||||||
|
Celanese Corp. |
19,458 | 2,208,677 | ||||||
|
Eastman Chemical Co. |
22,271 | 1,800,388 | ||||||
|
LyondellBasell Industries NV, Class A |
42,278 | 2,893,929 | ||||||
|
Westlake Chemical Corp. |
5,685 | 384,420 | ||||||
|
|
|
|||||||
| 8,918,869 | ||||||||
| Communications Equipment — 0.3% | ||||||||
|
Juniper Networks Inc. |
54,488 | 1,074,503 | ||||||
|
|
|
|||||||
| Construction & Engineering — 0.4% | ||||||||
|
AECOM(a)(b) |
26,342 | 1,181,175 | ||||||
|
|
|
|||||||
| Consumer Finance — 2.2% | ||||||||
|
Ally Financial Inc. |
61,522 | 1,641,407 | ||||||
|
Discover Financial Services |
50,397 | 3,276,309 | ||||||
|
Synchrony Financial |
89,293 | 2,234,111 | ||||||
|
|
|
|||||||
| 7,151,827 | ||||||||
| Security | Shares | Value | ||||||
|
Containers & Packaging — 3.3% |
|
|||||||
|
Amcor PLC |
257,969 | $ | 2,690,617 | |||||
|
Crown Holdings Inc.(b) |
22,172 | 1,902,357 | ||||||
|
International Paper Co. |
64,652 | 2,828,525 | ||||||
|
Packaging Corp. of America |
15,606 | 1,786,731 | ||||||
|
Westrock Co. |
42,731 | 1,604,549 | ||||||
|
|
|
|||||||
| 10,812,779 | ||||||||
| Distributors — 0.7% | ||||||||
|
Genuine Parts Co. |
23,730 | 2,145,904 | ||||||
|
|
|
|||||||
| Diversified Financial Services — 0.4% | ||||||||
|
Equitable Holdings Inc. |
66,431 | 1,427,602 | ||||||
|
|
|
|||||||
| Diversified Telecommunication Services — 0.4% | ||||||||
|
CenturyLink Inc. |
162,607 | 1,401,672 | ||||||
|
|
|
|||||||
| Electric Utilities — 8.4% | ||||||||
|
Alliant Energy Corp. |
41,060 | 2,269,797 | ||||||
|
Avangrid Inc. |
9,153 | 451,609 | ||||||
|
Edison International |
62,206 | 3,486,024 | ||||||
|
Entergy Corp. |
32,929 | 3,333,073 | ||||||
|
Evergy Inc. |
37,314 | 2,059,733 | ||||||
|
Eversource Energy |
56,359 | 4,918,450 | ||||||
|
FirstEnergy Corp. |
89,161 | 2,649,865 | ||||||
|
OGE Energy Corp. |
32,877 | 1,011,625 | ||||||
|
PG&E Corp.(a)(b) |
239,489 | 2,289,515 | ||||||
|
Pinnacle West Capital Corp. |
18,526 | 1,511,166 | ||||||
|
PPL Corp. |
126,442 | 3,477,155 | ||||||
|
|
|
|||||||
| 27,458,012 | ||||||||
| Electrical Equipment — 0.3% | ||||||||
|
Sensata Technologies Holding PLC(b) |
25,821 | 1,128,636 | ||||||
|
|
|
|||||||
| Electronic Equipment, Instruments & Components — 1.2% | ||||||||
|
Corning Inc. |
125,153 | 4,001,141 | ||||||
|
|
|
|||||||
| Energy Equipment & Services — 1.6% | ||||||||
|
Halliburton Co. |
144,547 | 1,743,237 | ||||||
|
Schlumberger Ltd. |
228,302 | 3,410,832 | ||||||
|
|
|
|||||||
| 5,154,069 | ||||||||
| Entertainment — 0.4% | ||||||||
|
Liberty Media Corp.-Liberty Formula One, Class A(b) |
4,238 | 141,125 | ||||||
|
Liberty Media Corp.-Liberty Formula One, Class C, NVS(b) |
33,414 | 1,207,248 | ||||||
|
|
|
|||||||
| 1,348,373 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 4.7% | ||||||||
|
Host Hotels & Resorts Inc. |
115,835 | 1,213,951 | ||||||
|
Iron Mountain Inc. |
47,326 | 1,233,315 | ||||||
|
Medical Properties Trust Inc. |
87,041 | 1,551,071 | ||||||
|
National Retail Properties Inc. |
28,502 | 912,349 | ||||||
|
Omega Healthcare Investors Inc. |
37,278 | 1,073,979 | ||||||
|
Simon Property Group Inc. |
50,311 | 3,160,034 | ||||||
|
Ventas Inc. |
61,362 | 2,421,958 | ||||||
|
Welltower Inc. |
68,634 | 3,690,450 | ||||||
|
|
|
|||||||
| 15,257,107 | ||||||||
| Food & Staples Retailing — 1.3% | ||||||||
|
Kroger Co. (The) |
127,946 | 4,121,141 | ||||||
|
|
|
|||||||
| Food Products — 5.7% | ||||||||
|
Archer-Daniels-Midland Co. |
91,388 | 4,225,781 | ||||||
|
Bunge Ltd. |
22,936 | 1,301,159 | ||||||
|
Campbell Soup Co. |
33,320 | 1,555,045 | ||||||
|
Conagra Brands Inc. |
80,341 | 2,819,166 | ||||||
|
JM Smucker Co. (The) |
18,766 | 2,105,545 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
31 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Machinery (continued) |
|
|||||||
|
Snap-on Inc. |
8,966 | $ | 1,412,414 | |||||
|
Stanley Black & Decker Inc. |
26,263 | 4,364,911 | ||||||
|
|
|
|||||||
| 17,338,076 | ||||||||
| Media — 3.5% | ||||||||
|
Discovery Inc., Class A(a)(b) |
26,337 | 533,061 | ||||||
|
Discovery Inc., Class C, NVS(b) |
50,842 | 931,425 | ||||||
|
DISH Network Corp., Class A(a)(b) |
40,520 | 1,032,855 | ||||||
|
Fox Corp., Class A, NVS |
56,574 | 1,500,342 | ||||||
|
Fox Corp., Class B(b) |
25,728 | 672,530 | ||||||
|
Interpublic Group of Companies Inc. (The) |
64,042 | 1,158,520 | ||||||
|
News Corp., Class A, NVS |
63,890 | 838,876 | ||||||
|
News Corp., Class B |
20,200 | 263,004 | ||||||
|
Omnicom Group Inc. |
35,359 | 1,668,945 | ||||||
|
ViacomCBS Inc., Class A |
1,714 | 51,180 | ||||||
|
ViacomCBS Inc., Class B, NVS |
92,724 | 2,649,125 | ||||||
|
|
|
|||||||
| 11,299,863 | ||||||||
| Metals & Mining — 1.1% | ||||||||
|
Nucor Corp. |
49,653 | 2,371,428 | ||||||
|
Reliance Steel & Aluminum Co. |
10,472 | 1,141,343 | ||||||
|
|
|
|||||||
| 3,512,771 | ||||||||
| Mortgage Real Estate Investment — 0.9% | ||||||||
|
AGNC Investment Corp. |
91,473 | 1,277,878 | ||||||
|
Annaly Capital Management Inc. |
230,873 | 1,636,889 | ||||||
|
|
|
|||||||
| 2,914,767 | ||||||||
| Multi-Utilities — 4.7% | ||||||||
|
Ameren Corp. |
40,637 | 3,296,473 | ||||||
|
CenterPoint Energy Inc. |
89,632 | 1,893,924 | ||||||
|
DTE Energy Co. |
31,685 | 3,910,563 | ||||||
|
NiSource Inc. |
63,046 | 1,448,167 | ||||||
|
Public Service Enterprise Group Inc. |
83,182 | 4,837,033 | ||||||
|
|
|
|||||||
| 15,386,160 | ||||||||
| Multiline Retail — 1.1% | ||||||||
|
Dollar Tree Inc.(b) |
39,030 | 3,525,190 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 4.7% | ||||||||
|
Continental Resources Inc./OK |
10,403 | 125,148 | ||||||
|
Hess Corp. |
44,987 | 1,674,416 | ||||||
|
HollyFrontier Corp. |
24,527 | 453,995 | ||||||
|
Marathon Petroleum Corp. |
107,020 | 3,157,090 | ||||||
|
Occidental Petroleum Corp. |
137,493 | 1,255,311 | ||||||
|
ONEOK Inc. |
73,070 | 2,119,030 | ||||||
|
Valero Energy Corp. |
67,064 | 2,589,341 | ||||||
|
Williams Companies Inc. (The) |
199,595 | 3,830,228 | ||||||
|
|
|
|||||||
| 15,204,559 | ||||||||
| Personal Products — 0.2% | ||||||||
|
Herbalife Nutrition Ltd.(b) |
16,090 | 726,303 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 1.1% | ||||||||
|
Jazz Pharmaceuticals PLC(b) |
9,132 | 1,315,921 | ||||||
|
Mylan NV(b) |
84,905 | 1,234,519 | ||||||
|
Perrigo Co. PLC |
22,416 | 983,390 | ||||||
|
|
|
|||||||
| 3,533,830 | ||||||||
| Professional Services — 0.5% | ||||||||
|
Nielsen Holdings PLC |
58,594 | 791,605 | ||||||
|
Robert Half International Inc. |
18,828 | 954,391 | ||||||
|
|
|
|||||||
| 1,745,996 | ||||||||
| Real Estate Management & Development — 0.3% | ||||||||
|
Jones Lang LaSalle Inc. |
8,504 | 959,761 | ||||||
|
|
|
|||||||
| 32 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Road & Rail — 0.2% |
||||||||
|
AMERCO |
1,487 | $ | 516,227 | |||||
|
|
|
|||||||
| Semiconductors & Semiconductor Equipment — 0.5% | ||||||||
|
ON Semiconductor Corp.(b) |
67,607 | 1,696,260 | ||||||
|
|
|
|||||||
| Specialty Retail — 1.3% | ||||||||
|
Best Buy Co. Inc. |
37,887 | 4,226,295 | ||||||
|
|
|
|||||||
| Technology Hardware, Storage & Peripherals — 4.1% | ||||||||
|
Dell Technologies Inc., Class C(a)(b) |
38,570 | 2,324,228 | ||||||
|
Hewlett Packard Enterprise Co. |
211,657 | 1,828,717 | ||||||
|
HP Inc. |
225,900 | 4,057,164 | ||||||
|
NetApp Inc. |
36,539 | 1,603,697 | ||||||
|
Seagate Technology PLC |
36,726 | 1,756,237 | ||||||
|
Western Digital Corp. |
49,771 | 1,877,860 | ||||||
|
|
|
|||||||
| 13,447,903 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
325,215,675 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 1.8% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
5,384,035 | 5,387,804 | ||||||
| Security | Shares | Value | ||||||
| Money Market Funds (continued) | ||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
345,000 | $ | 345,000 | |||||
|
|
|
|||||||
| 5,732,804 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 1.8%
|
|
5,732,804 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.6%
|
|
330,948,479 | ||||||
|
Other Assets, Less Liabilities — (1.6)% |
|
(5,057,455 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 325,891,024 | |||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Non-income producing security. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 7,269,938 | $ | — | $ | (1,879,527 | )(a) | $ | 2,437 | $ | (5,044 | ) | $ | 5,387,804 | 5,384 | $ | 45,875 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
525,000 | — | (180,000 | )(a) | — | — | 345,000 | 345 | 478 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 2,437 | $ | (5,044 | ) | $ | 5,732,804 | $ | 46,353 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
S&P MidCap 400 E-Mini Index |
3 | 12/18/20 | $ | 568 | $ | 7,013 | ||||||||||
|
S&P Select Sector Utilities E-Mini Index |
1 | 12/18/20 | 63 | (552 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | 6,461 | |||||||||||||||
|
|
|
|||||||||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
33 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Mid-Cap Value ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 7,013 | ||
|
|
|
|||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
552 | |||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 227,675 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (59,315 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 859,473 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 325,215,675 | $ | — | $ | — | $ | 325,215,675 | ||||||||
|
Money Market Funds |
5,732,804 | — | — | 5,732,804 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 330,948,479 | $ | — | $ | — | $ | 330,948,479 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 7,013 | $ | — | $ | — | $ | 7,013 | ||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
(552 | ) | — | — | (552 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 6,461 | $ | — | $ | — | $ | 6,461 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 34 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Small-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Aerospace & Defense — 1.7% | ||||||||
|
Aerojet Rocketdyne Holdings Inc.(a) |
19,524 | $ | 632,968 | |||||
|
Curtiss-Wright Corp. |
11,102 | 936,565 | ||||||
|
Moog Inc., Class A |
8,012 | 499,869 | ||||||
|
Spirit AeroSystems Holdings Inc., Class A(b) |
28,205 | 513,049 | ||||||
|
Virgin Galactic Holdings Inc.(a)(b) |
34,425 | 599,683 | ||||||
|
|
|
|||||||
| 3,182,134 | ||||||||
| Auto Components — 0.8% | ||||||||
|
LCI Industries |
6,717 | 736,586 | ||||||
|
Visteon Corp.(a) |
7,431 | 666,189 | ||||||
|
|
|
|||||||
| 1,402,775 | ||||||||
| Banks — 10.2% | ||||||||
|
Ameris Bancorp |
18,555 | 543,661 | ||||||
|
Atlantic Union Bankshares Corp. |
21,018 | 531,545 | ||||||
|
BancorpSouth Bank |
25,746 | 602,714 | ||||||
|
Bank of Hawaii Corp. |
10,694 | 648,484 | ||||||
|
Columbia Banking System Inc. |
19,124 | 543,313 | ||||||
|
Community Bank System Inc. |
14,293 | 828,851 | ||||||
|
Cullen/Frost Bankers Inc. |
14,901 | 1,047,093 | ||||||
|
CVB Financial Corp. |
34,016 | 595,280 | ||||||
|
East West Bancorp. Inc. |
37,781 | 1,378,251 | ||||||
|
First Citizens BancShares Inc./NC, Class A |
1,929 | 892,548 | ||||||
|
Glacier Bancorp. Inc. |
25,477 | 912,077 | ||||||
|
Independent Bank Corp. |
8,798 | 504,037 | ||||||
|
Investors Bancorp. Inc. |
60,726 | 513,742 | ||||||
|
Pinnacle Financial Partners Inc. |
20,252 | 927,339 | ||||||
|
Popular Inc. |
22,488 | 948,994 | ||||||
|
Prosperity Bancshares Inc. |
24,743 | 1,363,587 | ||||||
|
Simmons First National Corp., Class A |
29,110 | 494,579 | ||||||
|
South State Corp. |
18,938 | 1,162,793 | ||||||
|
Sterling Bancorp./DE |
51,931 | 694,837 | ||||||
|
United Bankshares Inc./WV |
34,648 | 908,817 | ||||||
|
United Community Banks Inc./GA |
22,953 | 480,636 | ||||||
|
Westamerica Bancorp |
7,191 | 376,593 | ||||||
|
Western Alliance Bancorp |
26,926 | 1,109,351 | ||||||
|
Wintrust Financial Corp. |
15,381 | 757,207 | ||||||
|
|
|
|||||||
| 18,766,329 | ||||||||
| Biotechnology — 1.7% | ||||||||
|
Alkermes PLC(a) |
42,469 | 690,121 | ||||||
|
Apellis Pharmaceuticals Inc.(a)(b) |
14,737 | 470,111 | ||||||
|
Bluebird Bio Inc.(a) |
17,683 | 914,388 | ||||||
|
Inovio Pharmaceuticals Inc.(a)(b) |
44,732 | 440,610 | ||||||
|
Kodiak Sciences Inc.(a) |
6,932 | 629,495 | ||||||
|
|
|
|||||||
| 3,144,725 | ||||||||
| Building Products — 0.4% | ||||||||
|
UFP Industries Inc. |
16,413 | 819,173 | ||||||
|
|
|
|||||||
| Capital Markets — 2.0% | ||||||||
|
Ares Management Corp., Class A |
25,239 | 1,067,609 | ||||||
|
Eaton Vance Corp., NVS |
30,487 | 1,822,818 | ||||||
|
Houlihan Lokey Inc. |
13,547 | 849,397 | ||||||
|
|
|
|||||||
| 3,739,824 | ||||||||
| Chemicals — 4.8% | ||||||||
|
Ashland Global Holdings Inc. |
14,532 | 1,013,898 | ||||||
|
Avient Corp. |
24,416 | 758,605 | ||||||
|
Axalta Coating Systems Ltd.(a) |
55,934 | 1,404,503 | ||||||
|
HB Fuller Co. |
13,770 | 623,093 | ||||||
|
Innospec Inc. |
6,558 | 433,746 | ||||||
| Security | Shares | Value | ||||||
|
Chemicals (continued) |
|
|||||||
|
Mosaic Co. (The) |
92,117 | $ | 1,704,164 | |||||
|
NewMarket Corp. |
1,954 | 698,926 | ||||||
|
Sensient Technologies Corp. |
11,310 | 740,013 | ||||||
|
Stepan Co. |
5,686 | 662,078 | ||||||
|
WR Grace & Co. |
16,614 | 722,543 | ||||||
|
|
|
|||||||
| 8,761,569 | ||||||||
| Commercial Services & Supplies — 2.3% | ||||||||
|
ABM Industries Inc. |
17,802 | 618,085 | ||||||
|
Brady Corp., Class A, NVS |
12,930 | 487,720 | ||||||
|
Brink’s Co. (The)(b) |
13,491 | 577,820 | ||||||
|
Casella Waste Systems Inc., Class A(a) |
12,020 | 648,960 | ||||||
|
Healthcare Services Group Inc. |
19,873 | 454,694 | ||||||
|
Stericycle Inc.(a)(b) |
24,428 | 1,521,864 | ||||||
|
|
|
|||||||
| 4,309,143 | ||||||||
| Communications Equipment — 0.5% | ||||||||
|
InterDigital Inc. |
8,226 | 460,492 | ||||||
|
NetScout Systems Inc.(a) |
19,347 | 397,000 | ||||||
|
|
|
|||||||
| 857,492 | ||||||||
| Construction & Engineering — 1.7% | ||||||||
|
Arcosa Inc. |
12,908 | 595,962 | ||||||
|
EMCOR Group Inc. |
14,661 | 999,734 | ||||||
|
MasTec Inc.(a) |
14,981 | 743,657 | ||||||
|
Valmont Industries Inc. |
5,704 | 809,683 | ||||||
|
|
|
|||||||
| 3,149,036 | ||||||||
| Construction Materials — 0.5% | ||||||||
|
Eagle Materials Inc. |
11,150 | 950,537 | ||||||
|
|
|
|||||||
| Consumer Finance — 0.5% | ||||||||
|
SLM Corp. |
100,198 | 920,820 | ||||||
|
|
|
|||||||
| Containers & Packaging — 0.9% | ||||||||
|
Graphic Packaging Holding Co. |
74,458 | 989,547 | ||||||
|
Silgan Holdings Inc. |
21,023 | 724,242 | ||||||
|
|
|
|||||||
| 1,713,789 | ||||||||
| Diversified Consumer Services — 0.8% | ||||||||
|
Adtalem Global Education Inc.(a) |
13,911 | 326,074 | ||||||
|
H&R Block Inc. |
51,509 | 889,045 | ||||||
|
WW International Inc.(a)(b) |
12,589 | 266,383 | ||||||
|
|
|
|||||||
| 1,481,502 | ||||||||
| Diversified Telecommunication Services — 1.1% | ||||||||
|
Iridium Communications Inc.(a)(b) |
31,142 | 822,460 | ||||||
|
Liberty Latin America Ltd., Class A(a) |
12,992 | 127,322 | ||||||
|
Liberty Latin America Ltd., Class C, NVS(a) |
40,451 | 393,184 | ||||||
|
Vonage Holdings Corp.(a)(b) |
61,635 | 652,098 | ||||||
|
|
|
|||||||
| 1,995,064 | ||||||||
| Electric Utilities — 1.2% | ||||||||
|
MGE Energy Inc. |
9,657 | 627,898 | ||||||
|
Otter Tail Corp. |
10,914 | 418,552 | ||||||
|
PNM Resources Inc. |
21,270 | 1,063,500 | ||||||
|
|
|
|||||||
| 2,109,950 | ||||||||
| Electrical Equipment — 2.1% | ||||||||
|
Acuity Brands Inc. |
10,584 | 943,458 | ||||||
|
EnerSys |
11,343 | 812,159 | ||||||
|
Sunrun Inc.(a) |
41,331 | 2,150,038 | ||||||
|
|
|
|||||||
| 3,905,655 | ||||||||
| Electronic Equipment, Instruments & Components — 2.6% | ||||||||
|
II-VI Inc.(a) |
27,682 | 1,258,700 | ||||||
|
Insight Enterprises Inc.(a) |
9,365 | 499,623 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
35 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Electronic Equipment, Instruments & Components (continued) |
|
|||||||
|
National Instruments Corp. |
35,097 | $ | 1,097,834 | |||||
|
Plexus Corp.(a) |
7,809 | 543,038 | ||||||
|
SYNNEX Corp. |
11,000 | 1,448,040 | ||||||
|
|
|
|||||||
| 4,847,235 | ||||||||
| Entertainment — 0.5% | ||||||||
|
Madison Square Garden Entertainment Corp.(a) |
4,680 | 304,200 | ||||||
|
Madison Square Garden Sports Corp.(a) |
4,626 | 655,227 | ||||||
|
|
|
|||||||
| 959,427 | ||||||||
| Equity Real Estate Investment Trusts (REITs) — 13.2% | ||||||||
|
Agree Realty Corp. |
14,380 | 892,567 | ||||||
|
Alexander’s Inc. |
578 | 140,564 | ||||||
|
American Assets Trust Inc. |
13,385 | 280,148 | ||||||
|
American Campus Communities Inc. |
36,752 | 1,376,730 | ||||||
|
Brandywine Realty Trust |
45,552 | 399,035 | ||||||
|
CareTrust REIT Inc. |
25,564 | 437,144 | ||||||
|
Corporate Office Properties Trust |
29,955 | 671,891 | ||||||
|
Cousins Properties Inc. |
39,672 | 1,010,843 | ||||||
|
CubeSmart |
51,736 | 1,755,402 | ||||||
|
Four Corners Property Trust Inc. |
18,781 | 475,911 | ||||||
|
Healthcare Realty Trust Inc. |
36,329 | 1,009,946 | ||||||
|
Healthcare Trust of America Inc., Class A |
58,358 | 1,418,099 | ||||||
|
Highwoods Properties Inc. |
27,743 | 825,909 | ||||||
|
Hudson Pacific Properties Inc. |
40,951 | 788,716 | ||||||
|
JBG SMITH Properties |
30,010 | 700,733 | ||||||
|
Lexington Realty Trust |
73,908 | 733,906 | ||||||
|
Life Storage Inc. |
12,528 | 1,430,071 | ||||||
|
National Storage Affiliates Trust |
16,532 | 560,269 | ||||||
|
Outfront Media Inc. |
38,561 | 505,535 | ||||||
|
Paramount Group Inc. |
44,954 | 259,834 | ||||||
|
Pebblebrook Hotel Trust |
34,945 | 418,641 | ||||||
|
Physicians Realty Trust |
55,580 | 937,079 | ||||||
|
Piedmont Office Realty Trust Inc., Class A |
33,659 | 384,386 | ||||||
|
PotlatchDeltic Corp. |
17,856 | 741,917 | ||||||
|
PS Business Parks Inc. |
5,357 | 610,859 | ||||||
|
Rayonier Inc. |
36,452 | 925,152 | ||||||
|
Spirit Realty Capital Inc. |
27,515 | 826,826 | ||||||
|
STAG Industrial Inc. |
39,825 | 1,239,354 | ||||||
|
STORE Capital Corp. |
60,909 | 1,565,361 | ||||||
|
Taubman Centers Inc. |
16,480 | 550,762 | ||||||
|
Washington REIT |
21,995 | 384,473 | ||||||
|
|
|
|||||||
| 24,258,063 | ||||||||
| Food & Staples Retailing — 1.7% | ||||||||
|
BJ’s Wholesale Club Holdings Inc.(a) |
36,835 | 1,410,412 | ||||||
|
Performance Food Group Co.(a) |
35,445 | 1,191,307 | ||||||
|
PriceSmart Inc. |
6,220 | 429,180 | ||||||
|
|
|
|||||||
| 3,030,899 | ||||||||
| Food Products — 2.7% | ||||||||
|
Cal-Maine Foods Inc.(a)(b) |
9,922 | 380,509 | ||||||
|
Darling Ingredients Inc.(a) |
43,248 | 1,859,664 | ||||||
|
Flowers Foods Inc. |
52,549 | 1,239,105 | ||||||
|
Hain Celestial Group Inc. (The)(a)(b) |
22,309 | 686,002 | ||||||
|
J&J Snack Foods Corp. |
3,986 | 540,382 | ||||||
|
Seaboard Corp. |
69 | 237,705 | ||||||
|
|
|
|||||||
| 4,943,367 | ||||||||
| Gas Utilities — 0.8% | ||||||||
|
ONE Gas Inc. |
14,131 | 975,604 | ||||||
|
South Jersey Industries Inc. |
26,860 | 517,592 | ||||||
|
|
|
|||||||
| 1,493,196 | ||||||||
| Security | Shares | Value | ||||||
|
Health Care Equipment & Supplies — 0.4% |
|
|||||||
|
LivaNova PLC(a) |
12,995 | $ | 654,168 | |||||
|
|
|
|||||||
| Health Care Providers & Services — 1.1% | ||||||||
|
AMN Healthcare Services Inc.(a) |
12,547 | 819,068 | ||||||
|
Premier Inc., Class A |
18,875 | 617,779 | ||||||
|
Select Medical Holdings Corp.(a)(b) |
28,620 | 600,448 | ||||||
|
|
|
|||||||
| 2,037,295 | ||||||||
| Hotels, Restaurants & Leisure — 3.7% | ||||||||
|
Boyd Gaming Corp. |
21,415 | 679,284 | ||||||
|
Dunkin’ Brands Group Inc. |
21,980 | 2,191,626 | ||||||
|
Hilton Grand Vacations Inc.(a)(b) |
22,718 | 467,991 | ||||||
|
Hyatt Hotels Corp., Class A |
9,448 | 520,963 | ||||||
|
Marriott Vacations Worldwide Corp. |
10,964 | 1,059,122 | ||||||
|
Papa John’s International Inc. |
8,762 | 671,169 | ||||||
|
Texas Roadhouse Inc. |
17,421 | 1,219,992 | ||||||
|
|
|
|||||||
| 6,810,147 | ||||||||
| Household Durables — 2.2% | ||||||||
|
Helen of Troy Ltd.(a) |
6,762 | 1,282,075 | ||||||
|
iRobot Corp.(a) |
7,446 | 592,553 | ||||||
|
Leggett & Platt Inc. |
35,353 | 1,475,281 | ||||||
|
LGI Homes Inc.(a) |
5,896 | 630,164 | ||||||
|
|
|
|||||||
| 3,980,073 | ||||||||
| Household Products — 0.3% | ||||||||
|
Central Garden & Pet Co.(a) |
2,596 | 101,140 | ||||||
|
Central Garden & Pet Co., Class A, NVS(a) |
10,373 | 367,101 | ||||||
|
|
|
|||||||
| 468,241 | ||||||||
| Independent Power and Renewable Electricity Producers — 0.4% | ||||||||
|
Clearway Energy Inc., Class A |
8,452 | 221,527 | ||||||
|
Clearway Energy Inc., Class C |
20,232 | 569,733 | ||||||
|
|
|
|||||||
| 791,260 | ||||||||
| Insurance — 2.5% | ||||||||
|
Axis Capital Holdings Ltd. |
21,387 | 913,011 | ||||||
|
Kemper Corp. |
16,398 | 1,011,101 | ||||||
|
Primerica Inc. |
10,553 | 1,163,363 | ||||||
|
Selective Insurance Group Inc. |
15,971 | 831,450 | ||||||
|
White Mountains Insurance Group Ltd. |
830 | 753,914 | ||||||
|
|
|
|||||||
| 4,672,839 | ||||||||
| Interactive Media & Services — 0.3% | ||||||||
|
TripAdvisor Inc. |
25,660 | 490,363 | ||||||
|
|
|
|||||||
| IT Services — 1.8% | ||||||||
|
CSG Systems International Inc. |
8,874 | 336,147 | ||||||
|
EVERTEC Inc. |
15,927 | 530,050 | ||||||
|
KBR Inc. |
38,013 | 847,310 | ||||||
|
ManTech International Corp./VA, Class A |
7,249 | 470,315 | ||||||
|
MAXIMUS Inc. |
16,372 | 1,106,420 | ||||||
|
|
|
|||||||
| 3,290,242 | ||||||||
| Leisure Products — 1.6% | ||||||||
|
Acushnet Holdings Corp. |
9,172 | 313,040 | ||||||
|
Mattel Inc.(a) |
92,631 | 1,275,529 | ||||||
|
Polaris Inc. |
15,396 | 1,398,881 | ||||||
|
|
|
|||||||
| 2,987,450 | ||||||||
| Life Sciences Tools & Services — 0.5% | ||||||||
|
Syneos Health Inc.(a) |
18,657 | 990,314 | ||||||
|
|
|
|||||||
| Machinery — 7.1% | ||||||||
|
Altra Industrial Motion Corp. |
16,229 | 693,952 | ||||||
|
Barnes Group Inc. |
12,413 | 455,557 | ||||||
|
Colfax Corp.(a) |
26,871 | 730,622 | ||||||
| 36 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Machinery (continued) |
|
|||||||
|
Flowserve Corp. |
34,756 | $ | 1,012,095 | |||||
|
ITT Inc. |
23,071 | 1,396,026 | ||||||
|
John Bean Technologies Corp. |
8,472 | 711,394 | ||||||
|
Lincoln Electric Holdings Inc. |
15,853 | 1,614,152 | ||||||
|
Middleby Corp. (The)(a) |
14,852 | 1,478,368 | ||||||
|
Mueller Industries Inc. |
15,165 | 438,723 | ||||||
|
Mueller Water Products Inc., Class A |
42,141 | 436,581 | ||||||
|
Rexnord Corp. |
32,219 | 1,033,586 | ||||||
|
SPX Corp.(a) |
11,933 | 505,840 | ||||||
|
Trinity Industries Inc. |
23,765 | 447,733 | ||||||
|
Watts Water Technologies Inc., Class A |
7,329 | 811,833 | ||||||
|
Woodward Inc. |
15,492 | 1,232,389 | ||||||
|
|
|
|||||||
| 12,998,851 | ||||||||
| Marine — 0.3% | ||||||||
|
Kirby Corp.(a) |
16,032 | 617,072 | ||||||
|
|
|
|||||||
| Media — 0.5% | ||||||||
|
Nexstar Media Group Inc., Class A |
12,093 | 996,463 | ||||||
|
|
|
|||||||
| Metals & Mining — 0.3% | ||||||||
|
Compass Minerals International Inc. |
9,064 | 547,284 | ||||||
|
|
|
|||||||
| Mortgage Real Estate Investment — 0.5% | ||||||||
|
Hannon Armstrong Sustainable Infrastructure Capital Inc. |
19,785 | 828,002 | ||||||
|
|
|
|||||||
| Oil, Gas & Consumable Fuels — 0.5% | ||||||||
|
CNX Resources Corp.(a)(b) |
59,967 | 581,680 | ||||||
|
Murphy Oil Corp. |
38,748 | 299,134 | ||||||
|
|
|
|||||||
| 880,814 | ||||||||
| Paper & Forest Products — 0.5% | ||||||||
|
Louisiana-Pacific Corp. |
29,989 | 857,086 | ||||||
|
|
|
|||||||
| Pharmaceuticals — 0.3% | ||||||||
|
Axsome Therapeutics Inc.(a) |
7,069 | 468,745 | ||||||
|
|
|
|||||||
| Professional Services — 1.5% | ||||||||
|
CoreLogic Inc. |
21,218 | 1,632,301 | ||||||
|
Insperity Inc. |
9,636 | 737,925 | ||||||
|
Korn Ferry |
15,024 | 453,574 | ||||||
|
|
|
|||||||
| 2,823,800 | ||||||||
| Real Estate Management & Development — 0.2% | ||||||||
|
Cushman & Wakefield PLC(a)(b) |
28,986 | 339,716 | ||||||
|
|
|
|||||||
| Road & Rail — 1.3% | ||||||||
|
Heartland Express Inc. |
13,338 | 244,219 | ||||||
|
Landstar System Inc. |
10,248 | 1,277,925 | ||||||
|
Schneider National Inc., Class B |
9,813 | 216,475 | ||||||
|
Werner Enterprises Inc. |
15,499 | 589,272 | ||||||
|
|
|
|||||||
| 2,327,891 | ||||||||
| Semiconductors & Semiconductor Equipment — 3.6% | ||||||||
|
Amkor Technology Inc.(a) |
28,488 | 337,583 | ||||||
|
Cirrus Logic Inc.(a) |
15,593 | 1,073,890 | ||||||
|
CMC Materials Inc. |
7,762 | 1,103,679 | ||||||
|
Cree Inc.(a) |
29,288 | 1,862,717 | ||||||
|
Diodes Inc.(a) |
11,211 | 648,332 | ||||||
|
MACOM Technology Solutions Holdings
|
12,145 | 443,292 | ||||||
|
Onto Innovation Inc.(a) |
13,035 | 418,032 | ||||||
|
Synaptics Inc.(a) |
9,140 | 700,764 | ||||||
|
|
|
|||||||
| 6,588,289 | ||||||||
| Software — 4.1% | ||||||||
|
Blackbaud Inc. |
13,238 | 653,163 | ||||||
| Security | Shares | Value | ||||||
|
Software (continued) |
|
|||||||
|
CDK Global Inc. |
32,455 | $ | 1,398,810 | |||||
|
CommVault Systems Inc.(a) |
12,388 | 490,441 | ||||||
|
j2 Global Inc.(a) |
11,949 | 811,098 | ||||||
|
Nuance Communications Inc.(a)(b) |
75,383 | 2,405,471 | ||||||
|
Progress Software Corp. |
12,026 | 437,386 | ||||||
|
Teradata Corp.(a) |
29,106 | 534,677 | ||||||
|
Verint Systems Inc.(a) |
17,230 | 836,000 | ||||||
|
|
|
|||||||
| 7,567,046 | ||||||||
| Specialty Retail — 3.1% | ||||||||
|
Lithia Motors Inc., Class A |
6,842 | 1,570,718 | ||||||
|
Murphy USA Inc.(a) |
7,246 | 886,113 | ||||||
|
RH(a) |
4,121 | 1,381,483 | ||||||
|
Williams-Sonoma Inc. |
20,774 | 1,894,797 | ||||||
|
|
|
|||||||
| 5,733,111 | ||||||||
| Textiles, Apparel & Luxury Goods — 2.1% | ||||||||
|
Columbia Sportswear Co. |
8,125 | 606,044 | ||||||
|
Crocs Inc.(a) |
18,014 | 942,673 | ||||||
|
Skechers U.S.A. Inc., Class A(a) |
36,396 | 1,154,117 | ||||||
|
Steven Madden Ltd. |
20,649 | 495,782 | ||||||
|
Wolverine World Wide Inc. |
21,863 | 583,086 | ||||||
|
|
|
|||||||
| 3,781,702 | ||||||||
| Thrifts & Mortgage Finance — 1.0% | ||||||||
|
Essent Group Ltd. |
30,020 | 1,196,297 | ||||||
|
TFS Financial Corp. |
12,810 | 201,245 | ||||||
|
WSFS Financial Corp. |
13,528 | 428,702 | ||||||
|
|
|
|||||||
| 1,826,244 | ||||||||
| Tobacco — 0.2% | ||||||||
|
Vector Group Ltd. |
34,130 | 313,655 | ||||||
|
|
|
|||||||
| Trading Companies & Distributors — 2.7% | ||||||||
|
Applied Industrial Technologies Inc. |
10,337 | 631,074 | ||||||
|
Beacon Roofing Supply Inc.(a) |
14,530 | 446,071 | ||||||
|
GATX Corp.(b) |
9,346 | 638,145 | ||||||
|
HD Supply Holdings Inc.(a) |
43,257 | 1,724,224 | ||||||
|
MSC Industrial Direct Co. Inc., Class A |
12,156 | 846,787 | ||||||
|
Univar Solutions Inc.(a) |
45,144 | 748,939 | ||||||
|
|
|
|||||||
| 5,035,240 | ||||||||
| Water Utilities — 0.6% | ||||||||
|
California Water Service Group |
13,191 | 587,923 | ||||||
|
SJW Group |
7,010 | 425,437 | ||||||
|
|
|
|||||||
| 1,013,360 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
|
183,458,467 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 4.4% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
7,253,417 | 7,258,495 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
37 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Money Market Funds (continued) |
||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
910,000 | $ | 910,000 | |||||
|
|
|
|||||||
| 8,168,495 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 4.4%
|
|
8,168,495 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 104.3%
|
|
191,626,962 | ||||||
|
Other Assets, Less Liabilities — (4.3)% |
|
(7,952,664 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
|
$ | 183,674,298 | |||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 12,032,962 | $ | — | $ | (4,770,971 | )(a) | $ | 5,769 | $ | (9,265 | ) | $ | 7,258,495 | 7,253,417 | $ | 51,967 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
104,000 | 806,000 | (a) | — | — | — | 910,000 | 910,000 | 196 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 5,769 | $ | (9,265 | ) | $ | 8,168,495 | $ | 52,163 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
Russell 2000 E-Mini Index |
2 | 12/18/20 | $ | 154 | $ | 20 | ||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 20 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
| 38 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap ETF |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 107,225 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (16,577 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 165,822 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 183,458,467 | $ | — | $ | — | $ | 183,458,467 | ||||||||
|
Money Market Funds |
8,168,495 | — | — | 8,168,495 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 191,626,962 | $ | — | $ | — | $ | 191,626,962 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 20 | $ | — | $ | — | $ | 20 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
39 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Small-Cap Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Aerospace & Defense — 2.0% | ||||||||
|
Axon Enterprise Inc.(a) |
19,853 | $ | 1,963,462 | |||||
|
BWX Technologies Inc. |
29,792 | 1,638,858 | ||||||
|
Kratos Defense & Security Solutions Inc.(a)(b) |
38,436 | 726,056 | ||||||
|
Mercury Systems Inc.(a) |
17,499 | 1,205,331 | ||||||
|
|
|
|||||||
| 5,533,707 | ||||||||
| Auto Components — 0.7% | ||||||||
|
Dorman Products Inc.(a) |
9,042 | 807,180 | ||||||
|
Fox Factory Holding Corp.(a) |
12,978 | 1,091,190 | ||||||
|
|
|
|||||||
| 1,898,370 | ||||||||
| Banks — 0.7% | ||||||||
|
First Financial Bankshares Inc. |
44,389 | 1,323,236 | ||||||
|
ServisFirst Bancshares Inc. |
14,682 | 541,766 | ||||||
|
|
|
|||||||
| 1,865,002 | ||||||||
| Beverages — 1.3% | ||||||||
|
Boston Beer Co. Inc. (The), Class A, NVS(a)(b) |
2,850 | 2,961,663 | ||||||
|
Coca-Cola Consolidated Inc. |
1,446 | 331,062 | ||||||
|
National Beverage Corp.(a)(b) |
3,631 | 284,271 | ||||||
|
|
|
|||||||
| 3,576,996 | ||||||||
| Biotechnology — 11.1% | ||||||||
|
Acceleron Pharma Inc.(a) |
16,294 | 1,704,027 | ||||||
|
Agios Pharmaceuticals Inc.(a) |
17,966 | 719,898 | ||||||
|
Alector Inc.(a) |
16,296 | 153,345 | ||||||
|
Amicus Therapeutics Inc.(a)(b) |
80,897 | 1,442,394 | ||||||
|
Arrowhead Pharmaceuticals Inc.(a) |
31,988 | 1,832,912 | ||||||
|
Blueprint Medicines Corp.(a) |
17,284 | 1,767,808 | ||||||
|
ChemoCentryx Inc.(a) |
15,536 | 745,728 | ||||||
|
CRISPR Therapeutics AG(a)(b) |
18,871 | 1,732,735 | ||||||
|
Deciphera Pharmaceuticals Inc.(a) |
12,360 | 717,745 | ||||||
|
Eidos Therapeutics Inc.(a)(b) |
3,364 | 238,575 | ||||||
|
Emergent BioSolutions Inc.(a) |
14,058 | 1,264,798 | ||||||
|
Fate Therapeutics Inc.(a) |
22,848 | 1,014,451 | ||||||
|
FibroGen Inc.(a) |
26,035 | 999,223 | ||||||
|
Global Blood Therapeutics Inc.(a)(b) |
19,218 | 1,016,248 | ||||||
|
Halozyme Therapeutics Inc.(a) |
40,243 | 1,126,804 | ||||||
|
Insmed Inc.(a) |
31,784 | 1,046,965 | ||||||
|
Intercept Pharmaceuticals Inc.(a) |
8,218 | 228,378 | ||||||
|
Invitae Corp.(a)(b) |
41,209 | 1,615,805 | ||||||
|
Iovance Biotherapeutics Inc.(a)(b) |
43,034 | 1,535,453 | ||||||
|
Ligand Pharmaceuticals Inc.(a)(b) |
5,036 | 415,218 | ||||||
|
Mirati Therapeutics Inc.(a) |
13,655 | 2,965,047 | ||||||
|
Natera Inc.(a) |
23,915 | 1,608,523 | ||||||
|
PTC Therapeutics Inc.(a) |
21,152 | 1,103,923 | ||||||
|
REVOLUTION Medicines Inc.(a)(b) |
12,802 | 386,492 | ||||||
|
Sage Therapeutics Inc.(a)(b) |
16,239 | 1,191,618 | ||||||
|
Ultragenyx Pharmaceutical Inc.(a)(b) |
19,124 | 1,921,962 | ||||||
|
Xencor Inc.(a) |
17,929 | 688,115 | ||||||
|
|
|
|||||||
| 31,184,190 | ||||||||
| Building Products — 2.3% | ||||||||
|
AAON Inc.(b) |
12,767 | 745,720 | ||||||
|
Advanced Drainage Systems Inc. |
15,289 | 969,781 | ||||||
|
Armstrong World Industries Inc. |
14,990 | 897,901 | ||||||
|
Simpson Manufacturing Co. Inc. |
13,583 | 1,205,084 | ||||||
|
Trex Co. Inc.(a) |
36,212 | 2,518,183 | ||||||
|
|
|
|||||||
| 6,336,669 | ||||||||
| Capital Markets — 2.1% | ||||||||
|
Assetmark Financial Holdings Inc.(a) |
5,415 | 114,527 | ||||||
|
Cohen & Steers Inc. |
7,343 | 413,484 | ||||||
| 40 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Equity Real Estate Investment Trusts (REITs) (continued) |
|
|||||||
|
First Industrial Realty Trust Inc. |
39,770 | $ | 1,583,244 | |||||
|
QTS Realty Trust Inc., Class A |
19,154 | 1,178,162 | ||||||
|
Rexford Industrial Realty Inc. |
38,710 | 1,798,467 | ||||||
|
Safehold Inc.(b) |
4,299 | 295,857 | ||||||
|
Terreno Realty Corp. |
21,349 | 1,201,522 | ||||||
|
|
|
|||||||
| 9,802,489 | ||||||||
| Food & Staples Retailing — 0.4% | ||||||||
|
Grocery Outlet Holding Corp.(a) |
26,043 | 1,146,413 | ||||||
|
|
|
|||||||
| Food Products — 1.3% | ||||||||
|
Freshpet Inc.(a) |
12,652 | 1,448,654 | ||||||
|
Lancaster Colony Corp. |
6,121 | 1,016,943 | ||||||
|
Sanderson Farms Inc. |
6,199 | 793,286 | ||||||
|
Simply Good Foods Co. (The)(a) |
26,288 | 494,214 | ||||||
|
|
|
|||||||
| 3,753,097 | ||||||||
| Health Care Equipment & Supplies — 7.4% | ||||||||
|
AtriCure Inc.(a) |
14,073 | 486,363 | ||||||
|
Avanos Medical Inc.(a) |
14,981 | 529,578 | ||||||
|
Cantel Medical Corp. |
11,750 | 562,120 | ||||||
|
CONMED Corp. |
8,948 | 697,675 | ||||||
|
Glaukos Corp.(a)(b) |
13,992 | 782,433 | ||||||
|
Globus Medical Inc., Class A(a) |
23,538 | 1,226,800 | ||||||
|
ICU Medical Inc.(a) |
6,083 | 1,081,497 | ||||||
|
Integer Holdings Corp.(a) |
10,288 | 601,334 | ||||||
|
Integra LifeSciences Holdings Corp.(a) |
22,171 | 977,741 | ||||||
|
iRhythm Technologies Inc.(a) |
8,963 | 1,895,226 | ||||||
|
Merit Medical Systems Inc.(a)(b) |
15,292 | 765,365 | ||||||
|
Neogen Corp.(a) |
16,568 | 1,155,452 | ||||||
|
Nevro Corp.(a) |
10,727 | 1,600,576 | ||||||
|
NuVasive Inc.(a) |
16,053 | 713,235 | ||||||
|
Quidel Corp.(a)(b) |
11,942 | 3,203,919 | ||||||
|
STAAR Surgical Co.(a) |
14,347 | 1,040,157 | ||||||
|
Tandem Diabetes Care Inc.(a) |
19,050 | 2,076,450 | ||||||
|
Wright Medical Group NV(a)(b) |
40,274 | 1,231,982 | ||||||
|
|
|
|||||||
| 20,627,903 | ||||||||
| Health Care Providers & Services — 2.9% | ||||||||
|
1Life Healthcare Inc.(a) |
22,536 | 635,741 | ||||||
|
Amedisys Inc.(a) |
10,157 | 2,630,663 | ||||||
|
Ensign Group Inc. (The) |
15,831 | 931,496 | ||||||
|
HealthEquity Inc.(a) |
23,963 | 1,233,855 | ||||||
|
LHC Group Inc.(a) |
9,880 | 2,139,514 | ||||||
|
Option Care Health Inc.(a)(b) |
16,867 | 224,837 | ||||||
|
Progyny Inc.(a)(b) |
11,249 | 274,138 | ||||||
|
|
|
|||||||
| 8,070,244 | ||||||||
| Health Care Technology — 1.2% | ||||||||
|
HMS Holdings Corp.(a) |
27,724 | 738,013 | ||||||
|
Inspire Medical Systems Inc.(a)(b) |
8,394 | 1,002,495 | ||||||
|
Omnicell Inc.(a)(b) |
13,360 | 1,156,308 | ||||||
|
Schrodinger Inc.(a)(b) |
10,269 | 500,922 | ||||||
|
|
|
|||||||
| 3,397,738 | ||||||||
| Hotels, Restaurants & Leisure — 3.5% | ||||||||
|
Caesars Entertainment Inc.(a) |
62,386 | 2,796,140 | ||||||
|
Choice Hotels International Inc. |
9,017 | 787,635 | ||||||
|
Churchill Downs Inc. |
11,097 | 1,655,118 | ||||||
|
Planet Fitness Inc., Class A(a) |
25,011 | 1,482,402 | ||||||
|
Shake Shack Inc., Class A(a) |
11,138 | 752,038 | ||||||
|
Wendy’s Co. (The) |
55,951 | 1,222,529 | ||||||
|
Wingstop Inc. |
9,270 | 1,078,379 | ||||||
|
|
|
|||||||
| 9,774,241 | ||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
41 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Growth ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Software (continued) |
||||||||
|
Pluralsight Inc., Class A(a)(b) |
31,199 | $ | 489,824 | |||||
|
Q2 Holdings Inc.(a) |
15,714 | 1,433,745 | ||||||
|
Qualys Inc.(a) |
10,571 | 928,662 | ||||||
|
Rapid7 Inc.(a) |
15,975 | 989,332 | ||||||
|
SailPoint Technologies Holding Inc.(a) |
28,334 | 1,176,144 | ||||||
|
SPS Commerce Inc.(a) |
11,002 | 941,661 | ||||||
|
SVMK Inc.(a) |
36,906 | 772,443 | ||||||
|
Tenable Holdings Inc.(a) |
20,615 | 703,178 | ||||||
|
Varonis Systems Inc.(a) |
9,856 | 1,139,058 | ||||||
|
|
|
|||||||
| 44,408,233 | ||||||||
| Specialty Retail — 3.3% | ||||||||
|
Carvana Co.(a) |
17,377 | 3,220,827 | ||||||
|
Five Below Inc.(a) |
17,468 | 2,329,183 | ||||||
|
Floor & Decor Holdings Inc., Class A(a) |
32,451 | 2,368,923 | ||||||
|
Monro Inc. |
10,439 | 439,064 | ||||||
|
National Vision Holdings Inc.(a)(b) |
25,189 | 1,015,873 | ||||||
|
|
|
|||||||
| 9,373,870 | ||||||||
| Technology Hardware, Storage & Peripherals — 0.4% | ||||||||
|
Pure Storage Inc., Class A(a)(b) |
74,536 | 1,200,030 | ||||||
|
|
|
|||||||
| Textiles, Apparel & Luxury Goods — 1.4% | ||||||||
|
Deckers Outdoor Corp.(a) |
8,764 | 2,220,535 | ||||||
|
Under Armour Inc., Class A(a) |
59,049 | 817,238 | ||||||
|
Under Armour Inc., Class C, NVS(a) |
60,907 | 744,892 | ||||||
|
|
|
|||||||
| 3,782,665 | ||||||||
| Thrifts & Mortgage Finance — 0.1% | ||||||||
|
Columbia Financial Inc.(a)(b) |
15,052 | 183,484 | ||||||
|
|
|
|||||||
| Trading Companies & Distributors — 0.6% | ||||||||
|
SiteOne Landscape Supply Inc.(a) |
13,807 | 1,649,798 | ||||||
|
|
|
|||||||
| Water Utilities — 0.3% | ||||||||
|
American States Water Co. |
11,552 | 862,819 | ||||||
|
|
|
|||||||
| Wireless Telecommunication Services — 0.2% | ||||||||
|
Shenandoah Telecommunications Co. |
15,614 | 681,083 | ||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
|
280,109,254 | ||||||
|
|
|
|||||||
|
Short-Term Investments |
||||||||
|
Money Market Funds — 14.8% |
||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
41,064,599 | 41,093,344 | ||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
290,000 | 290,000 | ||||||
|
|
|
|||||||
| 41,383,344 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 14.8%
|
|
41,383,344 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 114.7%
|
|
321,492,598 | ||||||
|
Other Assets, Less Liabilities — (14.7)% |
|
(41,091,041 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 280,401,557 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| 42 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Growth ETF |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at 04/30/20 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Value at 10/31/20 |
Shares Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 44,610,732 | $ | — | $ | (3,505,891 | )(a) | $ | 14,659 | $ | (26,156 | ) | $ | 41,093,344 | 41,064,599 | $ | 121,695 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
310,000 | — | (20,000 | )(a) | — | — | 290,000 | 290,000 | 149 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 14,659 | $ | (26,156 | ) | $ | 41,383,344 | $ | 121,844 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
Russell 2000 E-Mini Index |
3 | 12/18/20 | $ | 231 | $ | 6,579 | ||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 6,579 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 37,382 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (16,361 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 243,890 |
|
S C H E D U L E O F I N V E S T M E N T S |
43 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Growth ETF |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 280,109,254 | $ | — | $ | — | $ | 280,109,254 | ||||||||
|
Money Market Funds |
41,383,344 | — | — | 41,383,344 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 321,492,598 | $ | — | $ | — | $ | 321,492,598 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 6,579 | $ | — | $ | — | $ | 6,579 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 44 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Morningstar Small-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
| Aerospace & Defense — 0.5% | ||||||||
|
Hexcel Corp. |
31,533 | $ | 1,055,725 | |||||
|
Parsons Corp.(a) |
8,761 | 276,147 | ||||||
|
|
|
|||||||
| 1,331,872 | ||||||||
| Airlines — 1.4% | ||||||||
|
Alaska Air Group Inc. |
46,643 | 1,767,303 | ||||||
|
JetBlue Airways Corp.(a) |
102,830 | 1,230,875 | ||||||
|
SkyWest Inc. |
18,901 | 548,696 | ||||||
|
|
|
|||||||
| 3,546,874 | ||||||||
| Auto Components — 0.6% | ||||||||
|
Dana Inc. |
54,419 | 761,322 | ||||||
|
Goodyear Tire & Rubber Co. (The) |
87,763 | 726,678 | ||||||
|
|
|
|||||||
| 1,488,000 | ||||||||
| Automobiles — 1.4% | ||||||||
|
Harley-Davidson Inc. |
57,810 | 1,900,793 | ||||||
|
Thor Industries Inc.(b) |
20,824 | 1,761,294 | ||||||
|
|
|
|||||||
| 3,662,087 | ||||||||
| Banks — 10.7% | ||||||||
|
Associated Banc-Corp. |
57,885 | 792,446 | ||||||
|
Bank OZK |
45,641 | 1,130,984 | ||||||
|
BankUnited Inc. |
34,802 | 878,750 | ||||||
|
BOK Financial Corp. |
11,652 | 684,438 | ||||||
|
Cathay General Bancorp |
28,189 | 663,287 | ||||||
|
CIT Group Inc. |
37,172 | 1,094,715 | ||||||
|
Comerica Inc. |
52,452 | 2,387,091 | ||||||
|
First Financial Bancorp |
36,968 | 528,642 | ||||||
|
First Hawaiian Inc. |
48,921 | 844,376 | ||||||
|
First Horizon National Corp. |
208,722 | 2,172,796 | ||||||
|
First Merchants Corp. |
20,412 | 532,957 | ||||||
|
First Midwest Bancorp. Inc. |
43,121 | 541,169 | ||||||
|
FNB Corp. |
122,093 | 923,023 | ||||||
|
Fulton Financial Corp. |
61,070 | 671,159 | ||||||
|
Hancock Whitney Corp. |
32,524 | 743,824 | ||||||
|
Hilltop Holdings Inc. |
26,871 | 612,928 | ||||||
|
Home BancShares Inc./AR |
57,406 | 952,940 | ||||||
|
International Bancshares Corp. |
20,983 | 580,809 | ||||||
|
Old National Bancorp./IN |
62,181 | 869,290 | ||||||
|
PacWest Bancorp |
43,974 | 846,060 | ||||||
|
Renasant Corp. |
21,194 | 604,241 | ||||||
|
Synovus Financial Corp. |
55,590 | 1,445,340 | ||||||
|
TCF Financial Corp. |
57,436 | 1,562,834 | ||||||
|
Trustmark Corp. |
23,913 | 559,325 | ||||||
|
UMB Financial Corp. |
16,326 | 993,764 | ||||||
|
Umpqua Holdings Corp. |
83,156 | 1,044,439 | ||||||
|
Valley National Bancorp |
152,437 | 1,164,619 | ||||||
|
Webster Financial Corp. |
34,056 | 1,096,944 | ||||||
|
WesBanco Inc. |
25,331 | 615,290 | ||||||
|
|
|
|||||||
| 27,538,480 | ||||||||
| Biotechnology — 1.6% | ||||||||
|
Arena Pharmaceuticals Inc.(a)(b) |
21,747 | 1,864,153 | ||||||
|
United Therapeutics Corp.(a) |
16,754 | 2,248,889 | ||||||
|
|
|
|||||||
| 4,113,042 | ||||||||
| Building Products — 1.6% | ||||||||
|
Builders FirstSource Inc.(a) |
44,047 | 1,334,624 | ||||||
|
Owens Corning |
40,748 | 2,667,772 | ||||||
|
|
|
|||||||
| 4,002,396 | ||||||||
| Capital Markets — 3.7% | ||||||||
|
Affiliated Managers Group Inc.(b) |
17,569 | 1,324,176 | ||||||
| Security | Shares | Value | ||||||
|
Capital Markets (continued) |
||||||||
|
Evercore Inc., Class A |
15,321 | $ | 1,218,632 | |||||
|
Federated Hermes Inc. |
35,848 | 856,767 | ||||||
|
Invesco Ltd. |
142,040 | 1,862,144 | ||||||
|
Janus Henderson Group PLC |
56,885 | 1,382,306 | ||||||
|
Moelis & Co., Class A |
20,808 | 774,058 | ||||||
|
Stifel Financial Corp. |
25,865 | 1,512,068 | ||||||
|
Virtu Financial Inc., Class A |
30,467 | 651,384 | ||||||
|
|
|
|||||||
| 9,581,535 | ||||||||
| Chemicals — 3.1% | ||||||||
|
Cabot Corp. |
21,266 | 808,321 | ||||||
|
Chemours Co. (The) |
61,989 | 1,248,459 | ||||||
|
Element Solutions Inc.(a) |
82,727 | 969,560 | ||||||
|
Huntsman Corp. |
74,907 | 1,819,491 | ||||||
|
Minerals Technologies Inc. |
12,851 | 702,821 | ||||||
|
Olin Corp. |
53,670 | 888,239 | ||||||
|
PQ Group Holdings Inc.(a) |
14,913 | 172,394 | ||||||
|
Valvoline Inc. |
69,832 | 1,373,595 | ||||||
|
|
|
|||||||
| 7,982,880 | ||||||||
| Commercial Services & Supplies — 0.4% | ||||||||
|
ADT Inc. |
57,334 | 377,831 | ||||||
|
KAR Auction Services Inc. |
48,673 | 708,679 | ||||||
|
|
|
|||||||
| 1,086,510 | ||||||||
| Communications Equipment — 0.4% | ||||||||
|
CommScope Holding Co. Inc.(a) |
74,129 | 659,748 | ||||||
|
EchoStar Corp., Class A(a)(b) |
18,982 | 439,623 | ||||||
|
|
|
|||||||
| 1,099,371 | ||||||||
| Construction & Engineering — 1.5% | ||||||||
|
Fluor Corp. |
47,056 | 534,086 | ||||||
|
Quanta Services Inc. |
52,068 | 3,250,605 | ||||||
|
|
|
|||||||
| 3,784,691 | ||||||||
| Consumer Finance — 0.8% | ||||||||
|
Navient Corp. |
73,042 | 585,066 | ||||||
|
OneMain Holdings Inc. |
28,404 | 991,016 | ||||||
|
Santander Consumer USA Holdings Inc. |
27,381 | 556,930 | ||||||
|
|
|
|||||||
| 2,133,012 | ||||||||
| Containers & Packaging — 1.8% | ||||||||
|
Greif Inc., Class A, NVS |
9,987 | 405,372 | ||||||
|
Sealed Air Corp. |
58,729 | 2,325,081 | ||||||
|
Sonoco Products Co. |
37,867 | 1,851,318 | ||||||
|
|
|
|||||||
| 4,581,771 | ||||||||
| Diversified Consumer Services — 0.2% | ||||||||
|
Graham Holdings Co., Class B |
1,562 | 594,091 | ||||||
|
|
|
|||||||
| Diversified Financial Services — 0.6% | ||||||||
|
Jefferies Financial Group Inc. |
81,477 | 1,589,616 | ||||||
|
|
|
|||||||
| Electric Utilities — 2.1% | ||||||||
|
ALLETE Inc. |
19,589 | 1,010,401 | ||||||
|
Hawaiian Electric Industries Inc. |
41,200 | 1,361,248 | ||||||
|
IDACORP Inc. |
19,036 | 1,670,028 | ||||||
|
Portland General Electric Co. |
33,778 | 1,327,475 | ||||||
|
|
|
|||||||
| 5,369,152 | ||||||||
| Electrical Equipment — 1.1% | ||||||||
|
GrafTech International Ltd. |
35,366 | 238,721 | ||||||
|
nVent Electric PLC |
64,144 | 1,157,799 | ||||||
|
Regal Beloit Corp. |
15,312 | 1,510,529 | ||||||
|
|
|
|||||||
| 2,907,049 | ||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
45 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Health Care Technology — 0.5% |
||||||||
|
Change Healthcare Inc.(a) |
86,138 | $ | 1,218,853 | |||||
|
|
|
|||||||
| Hotels, Restaurants & Leisure — 3.7% | ||||||||
|
Cracker Barrel Old Country Store Inc. |
8,946 | 1,018,234 | ||||||
|
Extended Stay America Inc. |
60,166 | 682,884 | ||||||
|
Norwegian Cruise Line Holdings Ltd.(a)(b) |
103,977 | 1,729,137 | ||||||
|
Penn National Gaming Inc.(a) |
54,342 | 2,933,381 | ||||||
|
Six Flags Entertainment Corp. |
28,414 | 614,311 | ||||||
|
Wyndham Destinations Inc. |
32,189 | 1,050,327 | ||||||
|
Wyndham Hotels & Resorts Inc. |
35,145 | 1,634,594 | ||||||
|
|
|
|||||||
| 9,662,868 | ||||||||
| Household Durables — 2.6% | ||||||||
|
KB Home |
33,244 | 1,072,119 | ||||||
|
MDC Holdings Inc. |
18,865 | 821,005 | ||||||
|
Meritage Homes Corp.(a) |
14,192 | 1,235,981 | ||||||
|
Taylor Morrison Home Corp.(a) |
48,962 | 1,057,579 | ||||||
|
Toll Brothers Inc. |
43,318 | 1,831,485 | ||||||
|
TRI Pointe Group Inc.(a)(b) |
49,087 | 806,500 | ||||||
|
|
|
|||||||
| 6,824,669 | ||||||||
| Household Products — 0.7% | ||||||||
|
Energizer Holdings Inc. |
22,001 | 865,739 | ||||||
|
Spectrum Brands Holdings Inc. |
14,639 | 832,520 | ||||||
|
|
|
|||||||
| 1,698,259 | ||||||||
| Insurance — 5.7% | ||||||||
|
American Equity Investment Life Holding Co. |
34,634 | 859,616 | ||||||
|
American National Group Inc. |
3,436 | 236,397 | ||||||
|
Assured Guaranty Ltd. |
31,223 | 797,123 | ||||||
|
Athene Holding Ltd., Class A(a) |
47,640 | 1,528,291 | ||||||
|
Brighthouse Financial Inc.(a) |
35,126 | 1,162,671 | ||||||
|
CNO Financial Group Inc. |
53,524 | 950,051 | ||||||
|
Enstar Group Ltd.(a)(b) |
4,995 | 858,491 | ||||||
|
First American Financial Corp. |
42,070 | 1,875,901 | ||||||
|
Genworth Financial Inc., Class A(a) |
190,587 | 749,007 | ||||||
|
Hanover Insurance Group Inc. (The) |
14,235 | 1,361,720 | ||||||
|
Mercury General Corp. |
10,037 | 408,606 | ||||||
|
National General Holdings Corp. |
25,201 | 856,078 | ||||||
|
Old Republic International Corp. |
106,668 | 1,736,555 | ||||||
|
Unum Group |
76,813 | 1,356,518 | ||||||
|
|
|
|||||||
| 14,737,025 | ||||||||
| Internet & Direct Marketing Retail — 0.4% | ||||||||
|
Qurate Retail Inc., Series A |
146,305 | 990,485 | ||||||
|
|
|
|||||||
| IT Services — 2.3% | ||||||||
|
Alliance Data Systems Corp. |
17,972 | 926,277 | ||||||
|
DXC Technology Co. |
95,895 | 1,766,386 | ||||||
|
Perspecta Inc. |
51,614 | 925,439 | ||||||
|
Sabre Corp. |
117,366 | 765,226 | ||||||
|
Science Applications International Corp. |
21,943 | 1,675,787 | ||||||
|
|
|
|||||||
| 6,059,115 | ||||||||
| Leisure Products — 0.7% | ||||||||
|
Brunswick Corp./DE |
29,864 | 1,902,635 | ||||||
|
|
|
|||||||
| Machinery — 4.3% | ||||||||
|
AGCO Corp. |
23,169 | 1,784,708 | ||||||
|
Allison Transmission Holdings Inc. |
42,708 | 1,543,894 | ||||||
|
Crane Co. |
18,627 | 945,320 | ||||||
|
Gates Industrial Corp. PLC(a) |
16,473 | 182,850 | ||||||
|
Hillenbrand Inc. |
28,147 | 823,300 | ||||||
|
Kennametal Inc. |
31,318 | 970,858 | ||||||
|
Meritor Inc.(a) |
27,235 | 662,900 | ||||||
| 46 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Machinery (continued) |
||||||||
|
Navistar International Corp.(a) |
18,739 | $ | 807,838 | |||||
|
Oshkosh Corp. |
25,693 | 1,730,681 | ||||||
|
Timken Co. (The) |
25,502 | 1,522,470 | ||||||
|
|
|
|||||||
| 10,974,819 | ||||||||
| Media — 0.6% | ||||||||
|
John Wiley & Sons Inc., Class A |
16,457 | 509,509 | ||||||
|
TEGNA Inc. |
82,681 | 994,652 | ||||||
|
|
|
|||||||
| 1,504,161 | ||||||||
| Metals & Mining — 2.4% | ||||||||
|
Alcoa Corp.(a) |
70,230 | 907,372 | ||||||
|
Cleveland-Cliffs Inc.(b) |
150,672 | 1,247,564 | ||||||
|
Commercial Metals Co. |
44,975 | 928,734 | ||||||
|
Steel Dynamics Inc. |
75,392 | 2,373,340 | ||||||
|
Worthington Industries Inc. |
13,588 | 668,665 | ||||||
|
|
|
|||||||
| 6,125,675 | ||||||||
| Mortgage Real Estate Investment — 1.5% | ||||||||
|
Blackstone Mortgage Trust Inc., Class A |
55,186 | 1,197,536 | ||||||
|
New Residential Investment Corp. |
156,929 | 1,176,968 | ||||||
|
Starwood Property Trust Inc. |
107,320 | 1,499,260 | ||||||
|
|
|
|||||||
| 3,873,764 | ||||||||
| Multi-Utilities — 1.9% | ||||||||
|
Avista Corp. |
25,657 | 852,326 | ||||||
|
Black Hills Corp. |
23,678 | 1,341,595 | ||||||
|
MDU Resources Group Inc. |
75,647 | 1,797,373 | ||||||
|
NorthWestern Corp. |
19,096 | 995,474 | ||||||
|
|
|
|||||||
| 4,986,768 | ||||||||
| Multiline Retail — 1.0% | ||||||||
|
Kohl’s Corp. |
59,544 | 1,267,692 | ||||||
|
Macy’s Inc.(b) |
116,004 | 720,385 | ||||||
|
Nordstrom Inc.(b) |
40,877 | 494,611 | ||||||
|
|
|
|||||||
| 2,482,688 | ||||||||
| Oil, Gas & Consumable Fuels — 4.5% | ||||||||
|
Antero Midstream Corp. |
107,705 | 617,150 | ||||||
|
Apache Corp. |
142,484 | 1,182,617 | ||||||
|
Cimarex Energy Co. |
38,538 | 977,709 | ||||||
|
CVR Energy Inc. |
10,948 | 120,537 | ||||||
|
Delek U.S. Holdings Inc. |
23,370 | 235,102 | ||||||
|
Devon Energy Corp. |
144,483 | 1,290,233 | ||||||
|
EQT Corp. |
103,921 | 1,573,364 | ||||||
|
Equitrans Midstream Corp. |
153,451 | 1,114,054 | ||||||
|
Marathon Oil Corp. |
297,976 | 1,179,985 | ||||||
|
Ovintiv Inc. |
98,160 | 903,072 | ||||||
|
Southwestern Energy Co.(a)(b) |
228,056 | 608,910 | ||||||
|
Targa Resources Corp. |
87,995 | 1,412,320 | ||||||
|
World Fuel Services Corp. |
23,938 | 503,895 | ||||||
|
|
|
|||||||
| 11,718,948 | ||||||||
| Personal Products — 0.7% | ||||||||
|
Coty Inc., Class A |
106,828 | 309,801 | ||||||
|
Edgewell Personal Care Co.(a) |
20,473 | 536,802 | ||||||
|
Nu Skin Enterprises Inc., Class A |
19,406 | 957,686 | ||||||
|
|
|
|||||||
| 1,804,289 | ||||||||
| Pharmaceuticals — 1.1% | ||||||||
|
Nektar Therapeutics(a)(b) |
67,542 | 1,069,865 | ||||||
|
Prestige Consumer Healthcare Inc.(a) |
18,904 | 624,399 | ||||||
|
Reata Pharmaceuticals Inc., Class A(a)(b) |
9,059 | 1,057,276 | ||||||
|
|
|
|||||||
| 2,751,540 | ||||||||
| Professional Services — 1.1% | ||||||||
|
ASGN Inc.(a) |
19,813 | 1,321,131 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
47 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Value ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 5.5% | ||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares, 0.20%(c)(d)(e) |
14,019,891 | $ | 14,029,705 | |||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.04%(c)(d) |
290,000 | 290,000 | ||||||
|
|
|
|||||||
| 14,319,705 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 5.5%
|
|
14,319,705 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 105.4%
|
|
272,238,130 | ||||||
|
Other Assets, Less Liabilities — (5.4)% |
|
(14,040,040 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 258,198,090 | ||||||
|
|
|
|||||||
| (a) |
Non-income producing security. |
| (b) |
All or a portion of this security is on loan. |
| (c) |
Affiliate of the Fund. |
| (d) |
Annualized 7-day yield as of period-end. |
| (e) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
|
||||||||||||||||||||||||||||||||||||
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 14,494,125 | $ | — | $ | (459,536 | )(a) | $ | 7,676 | $ | (12,560 | ) | $ | 14,029,705 | 14,019,891 | $ | 59,811 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
663,000 | — | (373,000 | )(a) | — | — | 290,000 | 290,000 | 286 | — | ||||||||||||||||||||||||||
|
PennyMac Financial Services Inc.(c) |
— | 698,716 | (53,451 | ) | 9,097 | — | N/A | N/A | 2,415 | — | ||||||||||||||||||||||||||
|
PennyMac Mortgage Investment Trust(c) |
544,804 | — | (856,948 | ) | (329,294 | ) | 641,438 | N/A | N/A | — | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (312,521 | ) | $ | 628,878 | $ | 14,319,705 | $ | 62,512 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
| (c) |
As of period end, the entity is no longer an affiliate. |
Futures Contracts
|
|
||||||||||||||||
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
|
||||||||||||||||
|
Long Contracts |
||||||||||||||||
|
Russell 2000 E-Mini Index |
3 | 12/18/20 | $ | 231 | $ | (4,007 | ) | |||||||||
|
|
|
|||||||||||||||
| 48 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Morningstar Small-Cap Value ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 4,007 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
|
||||
|
Equity
Contracts |
||||
|
|
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 166,544 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (92,962 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 471,763 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 257,918,425 | $ | — | $ | — | $ | 257,918,425 | ||||||||
|
Money Market Funds |
14,319,705 | — | — | 14,319,705 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 272,238,130 | $ | — | $ | — | $ | 272,238,130 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (4,007 | ) | $ | — | $ | — | $ | (4,007 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
49 |
Statements of Assets and Liabilities (unaudited)
October 31, 2020
See notes to financial statements.
| 50 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Assets and Liabilities (unaudited) (continued)
October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
51 |
Statements of Assets and Liabilities (unaudited) (continued)
October 31, 2020
See notes to financial statements.
| 52 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Operations (unaudited)
Six Months Ended October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
53 |
Statements of Operations (unaudited) (continued)
Six Months Ended October 31, 2020
See notes to financial statements.
| 54 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Operations (unaudited) (continued)
Six Months Ended October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
55 |
Statements of Changes in Net Assets
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 56 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
57 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 58 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
59 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 60 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
(For a share outstanding throughout each period)
| iShares Morningstar Large-Cap ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 163.20 | $ | 167.61 | $ | 152.32 | $ | 142.88 | $ | 120.58 | $ | 122.54 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
1.32 | 3.22 | 3.24 | 2.93 | 2.57 | 2.27 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
24.39 | (3.51 | ) | 15.28 | 9.42 | 22.44 | (1.27 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
25.71 | (0.29 | ) | 18.52 | 12.35 | 25.01 | 1.00 | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(1.22 | ) | (4.12 | ) | (3.23 | ) | (2.91 | ) | (2.71 | ) | (2.96 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(1.22 | ) | (4.12 | ) | (3.23 | ) | (2.91 | ) | (2.71 | ) | (2.96 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 187.69 | $ | 163.20 | $ | 167.61 | $ | 152.32 | $ | 142.88 | $ | 120.58 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
15.79 | %(d) | (0.13 | )% | 12.33 | % | 8.66 | % | 20.97 | % | 0.87 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.20 | %(e) | 0.20 | % | 0.20 | % | 0.20 | % | 0.20 | % | 0.20 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
1.42 | %(e) | 1.90 | % | 2.05 | % | 1.91 | % | 1.96 | % | 1.91 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 760,145 | $ | 718,065 | $ | 863,172 | $ | 944,382 | $ | 814,433 | $ | 608,927 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
33 | %(d) | 49 | % | 38 | % | 46 | % | 45 | % | 39 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
61 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Large-Cap Growth ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 214.00 | $ | 190.39 | $ | 165.01 | $ | 136.27 | $ | 116.36 | $ | 118.09 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
0.36 | 1.07 | 1.16 | 1.48 | 1.12 | 1.13 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
41.37 | 23.64 | 25.47 | 28.70 | 19.88 | (1.64 | ) | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
41.73 | 24.71 | 26.63 | 30.18 | 21.00 | (0.51 | ) | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(0.38 | ) | (1.10 | ) | (1.25 | ) | (1.44 | ) | (1.09 | ) | (1.22 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(0.38 | ) | (1.10 | ) | (1.25 | ) | (1.44 | ) | (1.09 | ) | (1.22 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 255.35 | $ | 214.00 | $ | 190.39 | $ | 165.01 | $ | 136.27 | $ | 116.36 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
19.51 | %(d) | 13.04 | % | 16.21 | % | 22.26 | % | 18.15 | % | (0.44 | )% | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
0.29 | %(e) | 0.54 | % | 0.66 | % | 0.97 | % | 0.91 | % | 0.96 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,710,816 | $ | 1,519,374 | $ | 1,104,273 | $ | 932,317 | $ | 729,026 | $ | 791,246 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
26 | %(d) | 28 | % | 23 | % | 48 | % | 31 | % | 22 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 62 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Large-Cap Value ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20
(unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 96.23 | $ | 108.35 | $ | 101.09 | $ | 95.07 | $ | 85.03 | $ | 86.04 | ||||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
1.70 | 3.29 | 2.97 | 2.55 | 2.53 | 2.56 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
(0.23 | ) | (12.07 | ) | 7.17 | 6.02 | 10.03 | (1.03 | ) | |||||||||||||||||||||||||||||||||||||||
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|
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|
|
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|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
1.47 | (8.78 | ) | 10.14 | 8.57 | 12.56 | 1.53 | |||||||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(1.63 | ) | (3.34 | ) | (2.88 | ) | (2.55 | ) | (2.52 | ) | (2.54 | ) | ||||||||||||||||||||||||||||||||||||
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|
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|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(1.63 | ) | (3.34 | ) | (2.88 | ) | (2.55 | ) | (2.52 | ) | (2.54 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
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|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 96.07 | $ | 96.23 | $ | 108.35 | $ | 101.09 | $ | 95.07 | $ | 85.03 | ||||||||||||||||||||||||||||||||||||
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|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
1.51 | %(d) | (8.23 | )% | 10.22 | % | 9.07 | % | 14.95 | % | 1.92 | % | ||||||||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | ||||||||||||||||||||||||||||||||||||
|
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|
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|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
3.41 | %(e) | 3.06 | % | 2.86 | % | 2.54 | % | 2.78 | % | 3.10 | % | ||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 441,920 | $ | 447,483 | $ | 492,996 | $ | 374,024 | $ | 380,268 | $ | 289,101 | ||||||||||||||||||||||||||||||||||||
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|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
22 | %(d) | 36 | % | 24 | % | 24 | % | 31 | % | 27 | % | ||||||||||||||||||||||||||||||||||||
|
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|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
63 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Mid-Cap ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20
(unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 172.09 | $ | 196.31 | $ | 180.21 | $ | 168.00 | $ | 145.96 | $ | 151.49 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
1.18 | 2.69 | 2.99 | 2.48 | 2.01 | 2.30 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
26.61 | (24.12 | ) | 16.17 | 12.13 | 22.68 | (5.42 | ) | ||||||||||||||||||||||||||||||||||||||||
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|
|
|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
27.79 | (21.43 | ) | 19.16 | 14.61 | 24.69 | (3.12 | ) | ||||||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(1.21 | ) | (2.79 | ) | (3.06 | ) | (2.40 | ) | (2.65 | ) | (2.41 | ) | ||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(1.21 | ) | (2.79 | ) | (3.06 | ) | (2.40 | ) | (2.65 | ) | (2.41 | ) | ||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 198.67 | $ | 172.09 | $ | 196.31 | $ | 180.21 | $ | 168.00 | $ | 145.96 | ||||||||||||||||||||||||||||||||||||
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|
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|
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|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
16.18 | %(d) | (10.99 | )% | 10.79 | % | 8.73 | % | 17.06 | % | (2.03 | )% | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
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|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
1.21 | %(e) | 1.39 | % | 1.63 | % | 1.40 | % | 1.28 | % | 1.59 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
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|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 645,669 | $ | 567,905 | $ | 716,534 | $ | 747,858 | $ | 747,607 | $ | 540,062 | ||||||||||||||||||||||||||||||||||||
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|
|
|
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|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
29 | %(d) | 55 | % | 60 | % | 50 | % | 56 | % | 51 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
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|
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|
|
|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 64 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Mid-Cap Growth ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20
(unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 253.63 | $ | 243.96 | $ | 207.31 | $ | 177.31 | $ | 153.60 | $ | 165.11 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
0.14 | 0.78 | 0.55 | 0.75 | 0.84 | 0.60 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
68.37 | 9.66 | 36.74 | 30.14 | 23.76 | (11.46 | ) | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
68.51 | 10.44 | 37.29 | 30.89 | 24.60 | (10.86 | ) | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(0.20 | ) | (0.77 | ) | (0.64 | ) | (0.89 | ) | (0.89 | ) | (0.65 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(0.20 | ) | (0.77 | ) | (0.64 | ) | (0.89 | ) | (0.89 | ) | (0.65 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 321.94 | $ | 253.63 | $ | 243.96 | $ | 207.31 | $ | 177.31 | $ | 153.60 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
27.02 | %(d) | 4.29 | % | 18.03 | % | 17.46 | % | 16.06 | % | (6.58 | )% | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.30 | %(e) | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
0.09 | %(e) | 0.31 | % | 0.25 | % | 0.38 | % | 0.52 | % | 0.39 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
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|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,142,877 | $ | 532,633 | $ | 475,724 | $ | 259,139 | $ | 212,773 | $ | 207,355 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
20 | %(d) | 26 | % | 30 | % | 43 | % | 47 | % | 44 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
65 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Mid-Cap Value ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
|||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 120.38 | $ | 159.84 | $ | 157.66 | $ | 147.89 | $ | 125.61 | $ | 125.84 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income(a) |
1.87 | 4.51 | 3.69 | 3.26 | 2.87 | 2.86 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
12.56 | (39.25 | ) | 2.18 | 9.65 | 22.21 | (0.12 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net increase (decrease) from investment operations |
14.43 | (34.74 | ) | 5.87 | 12.91 | 25.08 | 2.74 | |||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||||||||||||||||||||||||||
|
From net investment income |
(1.79 | ) | (4.72 | ) | (3.69 | ) | (3.14 | ) | (2.80 | ) | (2.97 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total distributions |
(1.79 | ) | (4.72 | ) | (3.69 | ) | (3.14 | ) | (2.80 | ) | (2.97 | ) | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net asset value, end of period |
$ | 133.02 | $ | 120.38 | $ | 159.84 | $ | 157.66 | $ | 147.89 | $ | 125.61 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Total Return |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Based on net asset value |
12.05 | %(d) | (22.07 | )% | 3.83 | % | 8.81 | % | 20.15 | % | 2.29 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Total expenses |
0.30 | %(e) | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Net investment income |
2.86 | %(e) | 2.95 | % | 2.36 | % | 2.13 | % | 2.06 | % | 2.37 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 325,891 | $ | 331,048 | $ | 463,524 | $ | 417,801 | $ | 384,524 | $ | 194,702 | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Portfolio turnover rate(f) |
36 | %(d) | 51 | % | 35 | % | 45 | % | 38 | % | 38 | % | ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 66 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Small-Cap ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended
04/30/16 |
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Net asset value, beginning of period |
$ | 142.40 | $ | 175.58 | $ | 170.30 | $ | 161.10 | $ | 134.45 | $ | 140.33 | ||||||||||||||||||||||||||||||||||||
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Net investment income(a) |
1.09 | 2.29 | 2.30 | 1.96 | 1.67 | 2.05 | ||||||||||||||||||||||||||||||||||||||||||
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Net realized and unrealized gain (loss)(b) |
17.41 | (32.93 | ) | 5.37 | 9.40 | 27.48 | (5.99 | ) | ||||||||||||||||||||||||||||||||||||||||
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Net increase (decrease) from investment operations |
18.50 | (30.64 | ) | 7.67 | 11.36 | 29.15 | (3.94 | ) | ||||||||||||||||||||||||||||||||||||||||
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Distributions(c) |
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From net investment income |
(1.18 | ) | (2.54 | ) | (2.39 | ) | (2.16 | ) | (2.50 | ) | (1.94 | ) | ||||||||||||||||||||||||||||||||||||
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Total distributions |
(1.18 | ) | (2.54 | ) | (2.39 | ) | (2.16 | ) | (2.50 | ) | (1.94 | ) | ||||||||||||||||||||||||||||||||||||
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Net asset value, end of period |
$ | 159.72 | $ | 142.40 | $ | 175.58 | $ | 170.30 | $ | 161.10 | $ | 134.45 | ||||||||||||||||||||||||||||||||||||
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Total Return |
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Based on net asset value |
13.04 | %(d) | (17.58 | )% | 4.56 | % | 7.09 | % | 21.86 | % | (2.78 | )% | ||||||||||||||||||||||||||||||||||||
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Ratios to Average Net Assets |
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Total expenses |
0.25 | %(e) | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | ||||||||||||||||||||||||||||||||||||
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Net investment income |
1.39 | %(e) | 1.34 | % | 1.33 | % | 1.18 | % | 1.13 | % | 1.53 | % | ||||||||||||||||||||||||||||||||||||
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Supplemental Data |
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Net assets, end of period (000) |
$ | 183,674 | $ | 185,115 | $ | 237,032 | $ | 246,938 | $ | 241,644 | $ | 194,947 | ||||||||||||||||||||||||||||||||||||
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Portfolio turnover rate(f) |
43 | %(d) | 62 | % | 67 | % | 56 | % | 66 | % | 65 | % | ||||||||||||||||||||||||||||||||||||
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| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
67 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Small-Cap Growth ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
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Net asset value, beginning of period |
$ | 191.51 | $ | 205.00 | $ | 183.04 | $ | 154.83 | $ | 130.57 | $ | 139.32 | ||||||||||||||||||||||||||||||||||||
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Net investment income(a) |
0.12 | 0.49 | 0.24 | 0.72 | 0.86 | 0.83 | ||||||||||||||||||||||||||||||||||||||||||
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Net realized and unrealized gain (loss)(b) |
52.36 | (13.42 | ) | 22.31 | 28.26 | 25.25 | (8.79 | ) | ||||||||||||||||||||||||||||||||||||||||
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Net increase (decrease) from investment operations |
52.48 | (12.93 | ) | 22.55 | 28.98 | 26.11 | (7.96 | ) | ||||||||||||||||||||||||||||||||||||||||
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Distributions(c) |
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From net investment income |
(0.16 | ) | (0.56 | ) | (0.59 | ) | (0.77 | ) | (1.85 | ) | (0.79 | ) | ||||||||||||||||||||||||||||||||||||
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Total distributions |
(0.16 | ) | (0.56 | ) | (0.59 | ) | (0.77 | ) | (1.85 | ) | (0.79 | ) | ||||||||||||||||||||||||||||||||||||
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Net asset value, end of period |
$ | 243.83 | $ | 191.51 | $ | 205.00 | $ | 183.04 | $ | 154.83 | $ | 130.57 | ||||||||||||||||||||||||||||||||||||
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Total Return |
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Based on net asset value |
27.41 | %(d) | (6.32 | )% | 12.35 | % | 18.75 | % | 20.10 | % | (5.73 | )% | ||||||||||||||||||||||||||||||||||||
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Ratios to Average Net Assets |
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Total expenses |
0.30 | %(e) | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | ||||||||||||||||||||||||||||||||||||
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Net investment income |
0.11 | %(e) | 0.24 | % | 0.12 | % | 0.42 | % | 0.60 | % | 0.62 | % | ||||||||||||||||||||||||||||||||||||
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Supplemental Data |
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Net assets, end of period (000) |
$ | 280,402 | $ | 191,512 | $ | 215,251 | $ | 164,737 | $ | 116,125 | $ | 110,984 | ||||||||||||||||||||||||||||||||||||
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Portfolio turnover rate(f) |
31 | %(d) | 57 | % | 55 | % | 51 | % | 63 | % | 59 | % | ||||||||||||||||||||||||||||||||||||
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| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 68 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Morningstar Small-Cap Value ETF | ||||||||||||||||||||||||||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
|
10/31/20 (unaudited) |
Year Ended 04/30/20 |
Year Ended 04/30/19 |
Year Ended 04/30/18 |
Year Ended 04/30/17 |
Year Ended 04/30/16 |
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Net asset value, beginning of period |
$ | 98.85 | $ | 143.56 | $ | 144.25 | $ | 143.75 | $ | 122.26 | $ | 128.47 | ||||||||||||||||||||||||||||||||||||
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Net investment income(a) |
1.21 | 3.05 | 3.25 | 2.58 | 3.08 | 3.04 | ||||||||||||||||||||||||||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
11.11 | (44.22 | ) | (0.69 | ) | 0.61 | 21.83 | (6.28 | ) | |||||||||||||||||||||||||||||||||||||||
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Net increase (decrease) from investment operations |
12.32 | (41.17 | ) | 2.56 | 3.19 | 24.91 | (3.24 | ) | ||||||||||||||||||||||||||||||||||||||||
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Distributions(c) |
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From net investment income |
(1.30 | ) | (3.54 | ) | (3.25 | ) | (2.69 | ) | (3.42 | ) | (2.97 | ) | ||||||||||||||||||||||||||||||||||||
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Total distributions |
(1.30 | ) | (3.54 | ) | (3.25 | ) | (2.69 | ) | (3.42 | ) | (2.97 | ) | ||||||||||||||||||||||||||||||||||||
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Net asset value, end of period |
$ | 109.87 | $ | 98.85 | $ | 143.56 | $ | 144.25 | $ | 143.75 | $ | 122.26 | ||||||||||||||||||||||||||||||||||||
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Total Return |
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Based on net asset value |
12.53 | %(d) | (29.05 | )% | 1.83 | % | 2.23 | % | 20.58 | % | (2.42 | )% | ||||||||||||||||||||||||||||||||||||
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Ratios to Average Net Assets |
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Total expenses |
0.30 | %(e) | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | 0.30 | % | ||||||||||||||||||||||||||||||||||||
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Net investment income |
2.24 | %(e) | 2.34 | % | 2.24 | % | 1.78 | % | 2.29 | % | 2.56 | % | ||||||||||||||||||||||||||||||||||||
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Supplemental Data |
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Net assets, end of period (000) |
$ | 258,198 | $ | 257,012 | $ | 430,681 | $ | 447,161 | $ | 481,551 | $ | 379,000 | ||||||||||||||||||||||||||||||||||||
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Portfolio turnover rate(f) |
50 | %(d) | 65 | % | 48 | % | 54 | % | 48 | % | 51 | % | ||||||||||||||||||||||||||||||||||||
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| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
69 |
Notes to Financial Statements (unaudited)
| 1. |
ORGANIZATION |
iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.
These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):
| iShares ETF |
Diversification Classification |
|
|
Morningstar Large-Cap |
Diversified | |
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Morningstar Large-Cap Growth |
Diversified | |
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Morningstar Large-Cap Value |
Diversified | |
|
Morningstar Mid-Cap |
Diversified | |
|
Morningstar Mid-Cap Growth |
Diversified | |
|
Morningstar Mid-Cap Value |
Diversified | |
|
Morningstar Small-Cap |
Diversified | |
|
Morningstar Small-Cap Growth |
Diversified | |
|
Morningstar Small-Cap Value |
Diversified |
| 2. |
SIGNIFICANT ACCOUNTING POLICIES |
The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:
Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when the Funds are informed of the ex-dividend date. Under the applicable foreign tax laws, a withholding tax at various rates may be imposed on capital gains, dividends and interest. Any taxes withheld that are reclaimable from foreign tax authorities are reflected in tax reclaims receivable. Upon notification from issuers or as estimated by management, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain.
Foreign Taxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its statement of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “Other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2020, if any, are disclosed in the statement of assets and liabilities.
Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.
In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.
Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.
Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.
| 70 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 3. |
INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS |
Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. A fund determines the fair value of its financial instruments using various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.
Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:
| • |
Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price. |
| • |
Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV. |
| • |
Futures contracts are valued based on that day’s last reported settlement price on the exchange where the contract is traded. |
If events (e.g., a market closure, market volatility, company announcement, or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and the cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.
Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.
Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:
| • |
Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access; |
| • |
Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs); and |
| • |
Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments). |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgement exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.
| 4. |
SECURITIES AND OTHER INVESTMENTS |
Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.
As of October 31, 2020, any securities on loan were collateralized by cash and/or U.S. government obligations. Cash collateral received was invested in money market funds managed by BlackRock FundAdvisors (“BFA”), the Funds’ investment adviser, or its affiliates and is disclosed in the schedules of investments. Any non-cash collateral
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
71 |
Notes to Financial Statements (unaudited) (continued)
received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan for each Fund, if any, are also disclosed in its schedule of investments. The market value of any securities on loan as of October 31, 2020 and the value of the related cash collateral are disclosed in the statements of assets and liabilities.
Securities lending transactions are entered into by a fund under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value of the collateral is typically greater than the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the fund can reinvest cash collateral received in connection with loaned securities.
As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA as of October 31, 2020:
|
|
||||||||||||||||
|
iShares ETF and Counterparty |
|
Market Value of
Securities on Loan |
|
|
Cash Collateral
Received |
(a) |
|
Non-Cash Collateral
Received |
|
Net Amount | ||||||
|
|
||||||||||||||||
|
Morningstar Large-Cap Growth |
||||||||||||||||
|
Goldman Sachs & Co. |
$ | 1,889,754 | $ | 1,889,754 | $ | — | $ | — | ||||||||
|
Morgan Stanley & Co. LLC |
1,333,256 | 1,333,256 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 3,223,010 | 3,223,010 | — | $ | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap |
||||||||||||||||
|
Barclays Bank PLC |
$ | 15,194 | $ | 15,194 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
1,272,235 | 1,272,235 | — | — | ||||||||||||
|
BNP Paribas Securities Corp. |
13,394 | 13,394 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
1,594,927 | 1,594,927 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
2,357,010 | 2,357,010 | — | — | ||||||||||||
|
UBS Securities LLC |
1,197,492 | 1,197,492 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 6,450,252 | 6,450,252 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap Growth |
||||||||||||||||
|
Barclays Bank PLC |
$ | 23,253 | $ | 23,253 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
897,832 | 897,832 | — | — | ||||||||||||
|
BofA Securities, Inc. |
381,295 | 381,295 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
210,094 | 210,094 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
1,414,386 | 1,414,386 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
6,156,828 | 6,116,881 | — | (39,947 | )(b) | |||||||||||
|
Jefferies LLC |
6,955,470 | 6,955,470 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
13,232,210 | 13,232,210 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
2,328,893 | 2,328,893 | — | — | ||||||||||||
|
RBC Capital Markets LLC |
113,775 | 113,775 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
165,920 | 165,920 | — | — | ||||||||||||
|
UBS Securities LLC |
836,820 | 836,820 | — | — | ||||||||||||
|
Virtu Americas LLC |
363,525 | 363,525 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 33,080,301 | 33,040,354 | — | (39,947 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap Value |
||||||||||||||||
|
Goldman Sachs & Co. |
$ | 459,829 | 459,829 | $ | — | $ | — | |||||||||
|
HSBC Bank PLC |
362 | 362 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
9,391 | 9,391 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
518,326 | 518,134 | — | (192 | )(b) | |||||||||||
|
SG Americas Securities LLC |
2,263,454 | 2,263,454 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
1,618,558 | 1,618,558 | — | — | ||||||||||||
|
Wells Fargo Bank, National Association |
402,742 | 402,742 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 5,272,662 | 5,272,470 | — | (192 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 72 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
|
|
||||||||||||||||
|
iShares ETF and Counterparty |
|
Market Value of
Securities on Loan |
|
|
Cash Collateral
Received |
(a) |
|
Non-Cash Collateral
Received |
|
Net Amount | ||||||
|
|
||||||||||||||||
|
Morningstar Small-Cap |
||||||||||||||||
|
Barclays Bank PLC |
$ | 2,871,838 | $ | 2,871,838 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
174,134 | 174,134 | — | — | ||||||||||||
|
BNP Paribas Securities Corp. |
352,170 | 352,170 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
13,069 | 13,069 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
87,312 | 87,312 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
918,777 | 883,462 | — | (35,315 | )(b) | |||||||||||
|
Jefferies LLC |
3,802 | 3,802 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
3,170 | 3,170 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
724,865 | 724,865 | — | — | ||||||||||||
|
National Financial Services LLC |
841,489 | 841,489 | — | — | ||||||||||||
|
Nomura Securities International Inc. |
10,564 | 10,564 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
355,522 | 355,522 | — | — | ||||||||||||
|
UBS Securities LLC |
505,582 | 505,582 | — | — | ||||||||||||
|
Wells Fargo Bank, National Association |
122,220 | 122,220 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 6,984,514 | 6,949,199 | — | (35,315 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Small-Cap Growth |
||||||||||||||||
|
Barclays Bank PLC |
$ | 784,974 | $ | 784,974 | $ | — | $ | — | ||||||||
|
Barclays Capital Inc. |
366,900 | 366,900 | — | — | ||||||||||||
|
BMO Capital Markets |
36,985 | 36,985 | — | — | ||||||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
3,519,036 | 3,519,036 | — | — | ||||||||||||
|
BNP Paribas Securities Corp. |
214,309 | 214,309 | — | — | ||||||||||||
|
BofA Securities, Inc. |
2,123,340 | 2,123,340 | — | — | ||||||||||||
|
Citadel Clearing LLC |
1,681,941 | 1,681,941 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
3,096,798 | 3,096,798 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
686,726 | 686,726 | — | — | ||||||||||||
|
Deutsche Bank Securities Inc. |
90,672 | 90,672 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
4,636,173 | 4,636,173 | — | — | ||||||||||||
|
HSBC Bank PLC |
12,132 | 12,132 | — | — | ||||||||||||
|
Jefferies LLC |
1,095,267 | 1,095,267 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
5,015,171 | 5,015,171 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
11,087,062 | 11,087,062 | — | — | ||||||||||||
|
National Financial Services LLC |
330,747 | 327,010 | — | (3,737 | )(b) | |||||||||||
|
Natixis Securities Americas LLC |
23,526 | 23,526 | — | — | ||||||||||||
|
Nomura Securities International Inc. |
26,109 | 26,109 | — | — | ||||||||||||
|
SG Americas Securities LLC |
356,480 | 356,480 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
630,881 | 630,881 | — | — | ||||||||||||
|
UBS AG |
789,741 | 789,741 | — | — | ||||||||||||
|
UBS Securities LLC |
1,180,141 | 1,180,141 | — | — | ||||||||||||
|
Virtu Americas LLC |
653,968 | 653,968 | — | — | ||||||||||||
|
Wells Fargo Bank, National Association |
180,163 | 180,163 | — | — | ||||||||||||
|
Wells Fargo Securities LLC |
526,470 | 526,470 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 39,145,712 | 39,141,975 | — | (3,737 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Small-Cap Value |
||||||||||||||||
|
Barclays Bank PLC |
$ | 995,851 | $ | 995,851 | $ | — | $ | — | ||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
1,829,779 | 1,829,779 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
3,220,120 | 3,191,846 | — | (28,274 | )(b) | |||||||||||
|
Goldman Sachs & Co. |
1,694,853 | 1,694,853 | — | — | ||||||||||||
|
HSBC Bank PLC |
415,063 | 415,063 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
1,841,207 | 1,841,207 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
2,422,762 | 2,422,762 | — | — | ||||||||||||
|
National Financial Services LLC |
281,396 | 281,396 | — | — | ||||||||||||
|
RBC Capital Markets LLC |
13,896 | 13,896 | — | — | ||||||||||||
|
SG Americas Securities LLC |
34,374 | 34,374 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
233,853 | 233,853 | — | — | ||||||||||||
|
Wells Fargo Bank, National Association |
707,977 | 707,977 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 13,691,131 | 13,662,857 | — | (28,274 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s statement of assets and liabilities. |
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
73 |
Notes to Financial Statements (unaudited) (continued)
| (b) |
Additional collateral is delivered to the Fund on the next business day in accordance with the MSLA. The net amount would be subject to the borrower default indemnity in the event of default by a counterparty. |
The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.
| 5. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: Each Fund’s use of futures contracts is generally limited to cash equitization. This involves the use of available cash to invest in index futures contracts in order to gain exposure to the equity markets represented in or by the Fund’s underlying index and is intended to allow the Fund to better track its underlying index. Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).
Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the statement of assets and liabilities.
Securities deposited as initial margin are designated in the schedule of investments and cash deposited, if any, are shown as cash pledged for futures contracts in the statement of assets and liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the statement of assets and liabilities. When the contract is closed, a realized gain or loss is recorded in the statement of operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.
| 6. |
INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES |
Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).
For its investment advisory services to each Fund, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on the average daily net assets of each Fund as follows:
| iShares ETF | Investment Advisory Fee | |||
|
Morningstar Large-Cap |
0.20% | |||
|
Morningstar Large-Cap Growth |
0.25 | |||
|
Morningstar Large-Cap Value |
0.25 | |||
|
Morningstar Mid-Cap |
0.25 | |||
|
Morningstar Mid-Cap Growth |
0.30 | |||
|
Morningstar Mid-Cap Value |
0.30 | |||
|
Morningstar Small-Cap |
0.25 | |||
|
Morningstar Small-Cap Growth |
0.30 | |||
|
Morningstar Small-Cap Value |
0.30 | |||
Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.
Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money
| 74 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.
Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.
Pursuant to the current securities lending agreement, each Fund retains 75% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in that calendar year exceeds a specified threshold, each Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 80% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its statement of operations. For the six months ended October 31, 2020, the Funds paid BTC the following amounts for securities lending agent services:
| iShares ETF |
Fees Paid to BTC |
|||
|
Morningstar Large-Cap |
$ | 1,966 | ||
|
Morningstar Large-Cap Growth |
32,025 | |||
|
Morningstar Large-Cap Value |
37 | |||
|
Morningstar Mid-Cap |
13,152 | |||
|
Morningstar Mid-Cap Growth |
52,547 | |||
|
Morningstar Mid-Cap Value |
16,425 | |||
|
Morningstar Small-Cap |
19,295 | |||
|
Morningstar Small-Cap Growth |
47,294 | |||
|
Morningstar Small-Cap Value |
22,624 | |||
Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.
Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.
For the six months ended October 31, 2020, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:
| iShares ETF | Purchases | Sales |
Net Realized Gain (Loss) |
|||||||||
|
Morningstar Large-Cap |
$ | 145,012,856 | $ | 135,672,890 | $ | (9,236,206) | ||||||
|
Morningstar Large-Cap Growth |
173,748,073 | 208,025,577 | (12,940,752) | |||||||||
|
Morningstar Large-Cap Value |
46,095,099 | 56,810,512 | (3,948,424) | |||||||||
|
Morningstar Mid-Cap |
114,124,350 | 96,210,898 | (12,569,892) | |||||||||
|
Morningstar Mid-Cap Growth |
59,453,954 | 82,983,783 | 2,198,939 | |||||||||
|
Morningstar Mid-Cap Value |
69,494,990 | 64,936,911 | (21,194,745) | |||||||||
|
Morningstar Small-Cap |
49,700,616 | 36,023,787 | 463,492 | |||||||||
|
Morningstar Small-Cap Growth |
30,405,111 | 21,458,639 | (4,002,040) | |||||||||
|
Morningstar Small-Cap Value |
81,208,919 | 44,487,666 | (16,174,618) | |||||||||
Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends – affiliated in the statement of operations.
A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.
| 7. |
PURCHASES AND SALES |
For the six months ended October 31, 2020, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
75 |
Notes to Financial Statements (unaudited) (continued)
|
iShares ETF |
Purchases |
Sales |
||||||
|
Morningstar Large-Cap |
$ | 257,975,155 | $ | 256,456,047 | ||||
|
Morningstar Large-Cap Growth |
454,241,105 | 453,387,471 | ||||||
|
Morningstar Large-Cap Value |
95,970,956 | 95,996,371 | ||||||
|
Morningstar Mid-Cap |
185,151,500 | 184,588,671 | ||||||
|
Morningstar Mid-Cap Growth |
186,128,383 | 186,096,447 | ||||||
|
Morningstar Mid-Cap Value |
119,494,268 | 119,184,849 | ||||||
|
Morningstar Small-Cap |
77,922,245 | 78,343,979 | ||||||
|
Morningstar Small-Cap Growth |
73,383,284 | 73,313,845 | ||||||
|
Morningstar Small-Cap Value |
127,377,669 | 127,215,659 | ||||||
For the six months ended October 31, 2020, purchases and sales related to in-kind transactions were as follows:
| iShares ETF |
In-kind Purchases |
In-kind
Sales |
||||||
|
Morningstar Large-Cap |
$ | 18,371,051 | $ | 81,433,696 | ||||
|
Morningstar Large-Cap Growth |
566,391,084 | 673,833,910 | ||||||
|
Morningstar Large-Cap Value |
14,759,531 | 18,786,280 | ||||||
|
Morningstar Mid-Cap |
18,233,277 | 28,684,802 | ||||||
|
Morningstar Mid-Cap Growth |
471,699,538 | 44,143,103 | ||||||
|
Morningstar Mid-Cap Value |
6,707,577 | 44,055,473 | ||||||
|
Morningstar Small-Cap |
— | 21,338,594 | ||||||
|
Morningstar Small-Cap Growth |
68,960,183 | 32,592,457 | ||||||
|
Morningstar Small-Cap Value |
— | 25,315,066 | ||||||
| 8. |
INCOME TAX INFORMATION |
Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.
Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2020, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.
As of April 30, 2020, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
| iShares ETF |
Non-Expiring |
|||
|
Morningstar Large-Cap |
$ | 52,315,213 | ||
|
Morningstar Large-Cap Growth |
24,749,804 | |||
|
Morningstar Large-Cap Value |
10,108,212 | |||
|
Morningstar Mid-Cap |
45,083,340 | |||
|
Morningstar Mid-Cap Growth |
16,439,742 | |||
|
Morningstar Mid-Cap Value |
19,542,132 | |||
|
Morningstar Small-Cap |
27,272,705 | |||
|
Morningstar Small-Cap Growth |
7,569,180 | |||
|
Morningstar Small-Cap Value |
50,593,712 | |||
As of October 31, 2020, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:
| iShares ETF | Tax Cost |
Gross Unrealized Appreciation |
Gross Unrealized Depreciation |
Net Unrealized
Appreciation
|
||||||||||||
|
Morningstar Large-Cap |
$ | 604,479,566 | $ | 174,345,356 | $ | (19,258,623 | ) | $ | 155,086,733 | |||||||
|
Morningstar Large-Cap Growth |
1,254,853,984 | 473,576,502 | (14,084,244 | ) | 459,492,258 | |||||||||||
|
Morningstar Large-Cap Value |
448,233,043 | 50,399,450 | (58,022,045 | ) | (7,622,595 | ) | ||||||||||
|
Morningstar Mid-Cap |
561,655,885 | 129,740,256 | (39,302,666 | ) | 90,437,590 | |||||||||||
|
Morningstar Mid-Cap Growth |
958,371,642 | 236,032,719 | (16,501,609 | ) | 219,531,110 | |||||||||||
|
Morningstar Mid-Cap Value |
345,681,074 | 31,846,130 | (46,572,264 | ) | (14,726,134 | ) | ||||||||||
|
Morningstar Small-Cap |
188,560,457 | 23,094,440 | (20,027,915 | ) | 3,066,525 | |||||||||||
|
Morningstar Small-Cap Growth |
260,981,392 | 72,665,687 | (12,147,902 | ) | 60,517,785 | |||||||||||
|
Morningstar Small-Cap Value |
291,872,162 | 26,565,727 | (46,203,766 | ) | (19,638,039 | ) | ||||||||||
| 76 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
| 9. |
PRINCIPAL RISKS |
In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.
BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.
The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.
Market Risk: An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.
Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the statement of assets and liabilities, less any collateral held by the Funds.
A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.
With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.
Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.
Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific sectors are presented in the schedule of investments.
LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021, and it is expected that LIBOR will cease to be published after that time. The Funds may be exposed to financial instruments tied to LIBOR to determine payment obligations, financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Funds is uncertain.
| 10. |
CAPITAL SHARE TRANSACTIONS |
Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.
Transactions in capital shares were as follows:
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
77 |
Notes to Financial Statements (unaudited) (continued)
|
|
||||||||||||||||
|
Six Months Ended 10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF |
Shares |
Amount |
Shares |
Amount |
||||||||||||
|
|
||||||||||||||||
|
Morningstar Large-Cap |
||||||||||||||||
|
Shares sold |
100,000 | $ | 18,425,444 | 1,500,000 | $ | 259,485,127 | ||||||||||
|
Shares redeemed |
(450,000 | ) | (81,639,580 | ) | (2,250,000 | ) | (384,333,101 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(350,000 | ) | (63,214,136 | ) | (750,000 | ) | (124,847,974 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Large-Cap Growth |
||||||||||||||||
|
Shares sold |
2,400,000 | 567,277,791 | 2,850,000 | 588,806,800 | ||||||||||||
|
Shares redeemed |
(2,800,000 | ) | (675,010,221 | ) | (1,550,000 | ) | (301,105,937 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
(400,000 | ) | (107,732,430 | ) | 1,300,000 | 287,700,863 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Large-Cap Value |
||||||||||||||||
|
Shares sold |
150,000 | 14,935,914 | 1,800,000 | 196,396,198 | ||||||||||||
|
Shares redeemed |
(200,000 | ) | (18,843,419 | ) | (1,700,000 | ) | (184,653,379 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
(50,000 | ) | (3,907,505 | ) | 100,000 | 11,742,819 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap |
||||||||||||||||
|
Shares sold |
100,000 | 18,445,806 | 750,000 | 145,981,686 | ||||||||||||
|
Shares redeemed |
(150,000 | ) | (28,929,389 | ) | (1,100,000 | ) | (200,755,517 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(50,000 | ) | (10,483,583 | ) | (350,000 | ) | (54,773,831 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap Growth |
||||||||||||||||
|
Shares sold |
1,600,000 | 472,621,317 | 1,300,000 | 317,949,595 | ||||||||||||
|
Shares redeemed |
(150,000 | ) | (44,216,258 | ) | (1,150,000 | ) | (280,468,447 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
1,450,000 | 428,405,059 | 150,000 | 37,481,148 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Mid-Cap Value |
||||||||||||||||
|
Shares sold |
50,000 | 6,743,834 | 600,000 | 90,092,517 | ||||||||||||
|
Shares redeemed |
(350,000 | ) | (44,251,938 | ) | (750,000 | ) | (108,285,312 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(300,000 | ) | (37,508,104 | ) | (150,000 | ) | (18,192,795 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Small-Cap |
||||||||||||||||
|
Shares sold |
— | — | 250,000 | 43,217,116 | ||||||||||||
|
Shares redeemed |
(150,000 | ) | (21,987,812 | ) | (300,000 | ) | (52,311,159 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(150,000 | ) | (21,987,812 | ) | (50,000 | ) | (9,094,043 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Small-Cap Growth |
||||||||||||||||
|
Shares sold |
300,000 | 69,106,338 | 200,000 | 40,132,134 | ||||||||||||
|
Shares redeemed |
(150,000 | ) | (32,798,380 | ) | (250,000 | ) | (50,360,999 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase (decrease) |
150,000 | 36,307,958 | (50,000 | ) | (10,228,865 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Morningstar Small-Cap Value |
||||||||||||||||
|
Shares sold |
— | — | 400,000 | 53,954,280 | ||||||||||||
|
Shares redeemed |
(250,000 | ) | (26,060,395 | ) | (800,000 | ) | (94,278,219 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(250,000 | ) | (26,060,395 | ) | (400,000 | ) | (40,323,939 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.
From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the statement of assets and liabilities.
| 11. |
LEGAL PROCEEDINGS |
On June 16, 2016, investors in certain iShares funds (iShares Core S&P Small-Cap ETF, iShares Russell 1000 Growth ETF, iShares Core S&P 500 ETF, iShares Russell Mid-Cap Growth ETF, iShares Russell Mid-Cap ETF, iShares Russell Mid-Cap Value ETF, iShares Select Dividend ETF, iShares Morningstar Mid-Cap ETF, iShares Morningstar Large-Cap ETF, iShares U.S. Aerospace & Defense ETF and iShares Preferred and Income Securities ETF) filed a class action lawsuit against iShares Trust, BlackRock, Inc. and certain of its advisory affiliates, and certain directors/trustees and officers of the Funds (collectively, “Defendants”) in California State Court. The lawsuit
| 78 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
alleges the Defendants violated federal securities laws by failing to adequately disclose in the prospectuses issued by the funds noted above the risks of using stop-loss orders in the event of a ‘flash crash’, such as the one that occurred on May 6, 2010. On September 18, 2017, the court issued a Statement of Decision holding that the Plaintiffs lack standing to assert their claims. On October 11, 2017, the court entered final judgment dismissing all of the Plaintiffs’ claims with prejudice. In an opinion dated January 23, 2020, the California Court of Appeal affirmed the dismissal of Plaintiffs’ claims. On March 3, 2020, plaintiffs filed a petition for review by the California Supreme Court. On May 27, 2020, the California Supreme Court denied Plaintiff’s petition for review. The case is now closed.
Certain iShares funds (the “Impacted Funds”), along with thousands of other former shareholders of Tribune Company (“Tribune”), were named as defendants in one or more lawsuits (the “Litigation”) arising out of Tribune’s 2007 leveraged buyout transaction (“LBO”). The Litigation seeks to “claw back” from former Tribune shareholders, including the Impacted Funds, proceeds received in connection with the LBO. The iShares Morningstar Mid-Cap Value ETF received proceeds of $404,668 in the LBO. The claims that were originally brought against the Impacted Funds were dismissed but are currently subject to appeals in multiple appellate courts. The outcome of these appeals could result in new claims being brought against the Impacted Funds and/or previously dismissed claims being revived and subject to continuing litigation. The Impacted Funds intend to vigorously defend the Litigation.
| 12. |
SUBSEQUENT EVENTS |
Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were available to be issued and has determined that there were no subsequent events requiring adjustment or additional disclosure in the financial statements.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
79 |
Board Review and Approval of Investment Advisory Contract
iShares Morningstar Large-Cap ETF, iShares Morningstar Mid-Cap Growth ETF, iShares Morningstar Mid-Cap Value ETF, iShares Morningstar Small-Cap ETF, iShares Morningstar Small-Cap Growth ETF, iShares Morningstar Small-Cap Value ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA
| 80 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Board Review and Approval of Investment Advisory Contract (continued)
and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares Morningstar Large-Cap Growth ETF, iShares Morningstar Large-Cap Value ETF, iShares Morningstar Mid-Cap ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess
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Board Review and Approval of Investment Advisory Contract (continued)
BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the overall fund expenses (net of waivers and reimbursements) for the Fund were within range of the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue,
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Board Review and Approval of Investment Advisory Contract (continued)
including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
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Supplemental Information (unaudited)
Section 19(a) Notices
The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.
October 31, 2020
|
Total Cumulative Distributions
for the Fiscal Year-to-Date |
% Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date |
|||||||||||||||||||||||||||||||||
| iShares ETF |
Net
Investment Income |
Net Realized Capital Gains |
Return of
Capital |
Total Per
Share |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
||||||||||||||||||||||||||
|
Morningstar Large-Cap(a) |
$ | 1.212646 | $ | — | $ | 0.009866 | $ | 1.222512 | 99 | % | — | % | 1 | % | 100 | % | ||||||||||||||||||
|
Morningstar Large-Cap Growth(a) |
0.369334 | — | 0.009532 | 0.378866 | 97 | — | 3 | 100 | ||||||||||||||||||||||||||
|
Morningstar Large-Cap Value(a) |
1.624399 | — | 0.002651 | 1.627050 | 100 | — | 0 | (b) | 100 | |||||||||||||||||||||||||
|
Morningstar Mid-Cap(a) |
1.000501 | — | 0.206131 | 1.206632 | 83 | — | 17 | 100 | ||||||||||||||||||||||||||
|
Morningstar Mid-Cap Growth(a) |
0.199715 | — | 0.003968 | 0.203683 | 98 | — | 2 | 100 | ||||||||||||||||||||||||||
|
Morningstar Mid-Cap Value(a) |
1.562930 | — | 0.229345 | 1.792275 | 87 | — | 13 | 100 | ||||||||||||||||||||||||||
|
Morningstar Small-Cap(a) |
0.979971 | — | 0.201997 | 1.181968 | 83 | — | 17 | 100 | ||||||||||||||||||||||||||
|
Morningstar Small-Cap Growth(a) |
0.133455 | — | 0.022454 | 0.155909 | 86 | — | 14 | 100 | ||||||||||||||||||||||||||
|
Morningstar Small-Cap Value(a) |
1.107744 | — | 0.188805 | 1.296549 | 85 | — | 15 | 100 | ||||||||||||||||||||||||||
| (a) |
The Fund estimates that it has distributed more than its net investment income and net realized capital 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 shareholder’s investment in the Fund is returned 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”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share. |
| (b) |
Rounds to less than 1%. |
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Electronic Delivery
Shareholders can sign up for email notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.
To enroll in electronic delivery:
| • |
Go to icsdelivery.com. |
| • |
If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor. |
Householding
Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.
Availability of Quarterly Schedule of Investments
The iShares Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The iShares Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. The iShares Funds also disclose their complete schedule of portfolio holdings on a daily basis on the iShares website at iShares.com.
Availability of Proxy Voting Policies and Proxy Voting Records
A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.
A description of the Company’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.
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G E N E R A L I N F O R M A T I O N |
85 |
Glossary of Terms Used in this Report
| Portfolio Abbreviations - Equity | ||
| NVS | Non-Voting Shares | |
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Want to know more?
iShares.com | 1-800-474-2737
This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.
Investing involves risk, including possible loss of principal.
The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Morningstar, Inc., nor does this company make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the company listed above.
©2020 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.
iS-SAR-404-1020
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OCTOBER 31, 2020 |
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2020 Semi-Annual Report (Unaudited)
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iShares Trust
| · |
iShares Cohen & Steers REIT ETF | ICF | Cboe BZX |
| · |
iShares Core U.S. REIT ETF | USRT | NYSE Arca |
| · |
iShares Global REIT ETF | REET | NYSE Arca |
| · |
iShares International Developed Real Estate ETF | IFGL | NASDAQ |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.
Dear Shareholder,
The 12-month reporting period as of October 31, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus (or “COVID-19”) led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered solid returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.
After markets hit their lowest point of the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which declined marginally during the reporting period. International equities from developed economies declined, significantly lagging emerging market stocks, which rebounded sharply.
During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.
The Fed took an accommodative monetary stance in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted two emergency interest rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.
Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.
Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring emerging market stocks and tilting toward the quality factor for its resilience.
In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.
Sincerely,
Rob Kapito
President, BlackRock, Inc.
Rob Kapito
President, BlackRock, Inc.
| Total Returns as of October 31, 2020 | ||||
| 6-Month | 12-Month | |||
|
U.S. large cap equities
|
13.29% | 9.71% | ||
|
U.S. small cap equities
|
18.13 | (0.14) | ||
|
International equities
|
8.57 | (6.86) | ||
|
Emerging market equities
|
20.96 | 8.25 | ||
|
3-month Treasury
bills
|
0.06 | 0.92 | ||
|
U.S. Treasury securities
|
(1.63) | 8.92 | ||
|
U.S. investment grade bonds
|
1.27 | 6.19 | ||
|
Tax-exempt municipal
bonds
|
4.87 | 3.55 | ||
|
U.S. high yield bonds
|
10.73 | 3.42 | ||
|
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index. |
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T H I S P A G E I S N O T P A R T O F Y O U R F U N D R E P O R T |
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Financial Statements |
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| Fund Summary as of October 31, 2020 | iShares® Cohen & Steers REIT ETF |
Investment Objective
The iShares Cohen & Steers REIT ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. real estate investment trusts (REITs), as represented by the Cohen & Steers Realty Majors Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
0.51 | % | (15.37 | )% | 3.49 | % | 7.71 | % | (15.37 | )% | 18.70 | % | 110.24 | % | ||||||||||||||||||
|
Fund Market |
0.57 | (15.39 | ) | 3.49 | 7.72 | (15.39 | ) | 18.73 | 110.31 | |||||||||||||||||||||||
|
Index |
0.76 | (15.00 | ) | 3.86 | 8.09 | (15.00 | ) | 20.86 | 117.63 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 8 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,005.10 | $ | 1.67 | $ | 1,000.00 | $ | 1,023.50 | $ | 1.68 | 0.33 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 8 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Specialized REITs |
39.7 | % | ||
|
Residential REITs |
20.3 | |||
|
Industrial REITs |
11.0 | |||
|
Retail REITs |
11.0 | |||
|
Office REITs |
9.1 | |||
|
Health Care REITs |
7.4 | |||
|
Hotel & Resort REITs |
1.5 |
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Prologis Inc. |
8.2 | % | ||
|
Equinix Inc. |
8.0 | |||
|
American Tower Corp. |
7.7 | |||
|
Digital Realty Trust Inc. |
7.7 | |||
|
Public Storage |
6.9 | |||
|
SBA Communications Corp. |
6.4 | |||
|
Welltower Inc. |
4.5 | |||
|
Realty Income Corp. |
4.0 | |||
|
AvalonBay Communities Inc. |
3.9 | |||
|
Simon Property Group Inc. |
3.8 |
| (a) |
Excludes money market funds. |
| 4 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® Core U.S. REIT ETF |
Investment Objective
The iShares Core U.S. REIT ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. real estate equities, as represented by the FTSE Nareit Equity REITs Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
1.96 | % | (21.44 | )% | 2.18 | % | 6.57 | % | (21.44 | )% | 11.38 | % | 88.95 | % | ||||||||||||||||||
|
Fund Market |
2.03 | (21.44 | ) | 2.18 | 6.57 | (21.44 | ) | 11.40 | 88.93 | |||||||||||||||||||||||
|
Index |
2.00 | (21.38 | ) | 2.26 | 6.88 | (21.38 | ) | 11.82 | 94.48 | |||||||||||||||||||||||
Index performance through November 2, 2016 reflects the performance of the FTSE NAREIT Real Estate 50 Index. Index performance beginning on November 3, 2016 reflects the performance of the FTSE Nareit Equity REITS Index.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 8 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,019.60 | $ | 0.41 | $ | 1,000.00 | $ | 1,024.80 | $ | 0.41 | 0.08 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 8 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Specialized REITs |
28.1 | % | ||
|
Residential REITs |
17.8 | |||
|
Industrial REITs |
15.6 | |||
|
Health Care REITs |
11.4 | |||
|
Retail REITs |
10.7 | |||
|
Office REITs |
9.1 | |||
|
Diversified REITs |
4.5 | |||
|
Hotel & Resort REITs |
2.8 |
TEN LARGEST HOLDINGS
| Security |
|
Percent of
Total Investments |
(a) |
|
|
Prologis Inc. |
9.2 | % | ||
|
Equinix Inc. |
8.1 | |||
|
Digital Realty Trust Inc. |
4.8 | |||
|
Public Storage |
4.3 | |||
|
Welltower Inc. |
2.8 | |||
|
Realty Income Corp. |
2.5 | |||
|
AvalonBay Communities Inc. |
2.5 | |||
|
Simon Property Group Inc. |
2.4 | |||
|
Alexandria Real Estate Equities Inc. |
2.4 | |||
|
Equity Residential |
2.2 |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
5 |
| Fund Summary as of October 31, 2020 | iShares® Global REIT ETF |
Investment Objective
The iShares Global REIT ETF (the “Fund”) seeks to track the investment results of an index composed of global real estate equities in developed and emerging markets, as represented by the FTSE EPRA Nareit Global REITS Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years |
Since
Inception |
1 Year | 5 Years |
Since
Inception |
||||||||||||||||||||||||||
|
Fund NAV |
1.39 | % | (25.02 | )% | 0.35 | % | 1.31 | % | (25.02 | )% | 1.75 | % | 8.54 | % | ||||||||||||||||||
|
Fund Market |
2.04 | (24.98 | ) | 0.32 | 1.33 | (24.98 | ) | 1.62 | 8.69 | |||||||||||||||||||||||
|
Index |
0.93 | (25.67 | ) | (0.48 | ) | 0.51 | (25.67 | ) | (2.38 | ) | 3.27 | |||||||||||||||||||||
The inception date of the Fund was 7/8/14. The first day of secondary market trading was 7/10/14.
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 8 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,013.90 | $ | 0.71 | $ | 1,000.00 | $ | 1,024.50 | $ | 0.71 | 0.14 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 8 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Industrial REITs |
18.6 | % | ||
|
Retail REITs |
15.8 | |||
|
Residential REITs |
15.8 | |||
|
Specialized REITs |
13.7 | |||
|
Office REITs |
12.7 | |||
|
Diversified REITs |
11.4 | |||
|
Health Care REITs |
9.5 | |||
|
Hotel & Resort REITs |
2.5 |
TEN LARGEST GEOGRAPHIC ALLOCATION
| Country/Geographic Region |
|
Percent of
Total Investments |
(a) |
|
|
United States |
66.1 | % | ||
|
Japan |
9.7 | |||
|
United Kingdom |
5.5 | |||
|
Australia |
4.0 | |||
|
Singapore |
3.7 | |||
|
Canada |
3.3 | |||
|
France |
1.8 | |||
|
Hong Kong |
1.6 | |||
|
Belgium |
1.5 | |||
|
Mexico |
0.5 |
| (a) |
Excludes money market funds. |
| 6 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Fund Summary as of October 31, 2020 | iShares® International Developed Real Estate ETF |
Investment Objective
The iShares International Developed Real Estate ETF (the “Fund”) seeks to track the investment results of an index composed of real estate equities in developed non-U.S. markets, as represented by the FTSE EPRA Nareit Developed ex-U.S. Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.
Performance
| Average Annual Total Returns | Cumulative Total Returns | |||||||||||||||||||||||||||||||
| 6 Months | 1 Year | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years | ||||||||||||||||||||||||||
|
Fund NAV |
2.52 | % | (20.52 | )% | 0.38 | % | 2.57 | % | (20.52 | )% | 1.92 | % | 28.86 | % | ||||||||||||||||||
|
Fund Market |
3.20 | (20.33 | ) | 0.51 | 2.50 | (20.33 | ) | 2.58 | 28.05 | |||||||||||||||||||||||
|
Index |
2.20 | (20.45 | ) | 0.56 | 2.87 | (20.45 | ) | 2.84 | 32.76 | |||||||||||||||||||||||
Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 8 for more information.
Expense Example
| Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Beginning
Account Value (05/01/20) |
|
|
Ending
Account Value (10/31/20) |
|
|
Expenses
Paid During the Period |
(a) |
|
Annualized
Expense Ratio |
|
||||||||||
| $ | 1,000.00 | $ | 1,025.20 | $ | 2.45 | $ | 1,000.00 | $ | 1,022.80 | $ | 2.45 | 0.48 | % | |||||||||||||||||
| (a) |
Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (184 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 8 for more information. |
Portfolio Information
ALLOCATION BY SECTOR
| Sector |
|
Percent of
Total Investments |
(a) |
|
|
Real Estate Operating Companies |
25.6 | % | ||
|
Diversified Real Estate Activities |
14.7 | |||
|
Retail REITs |
13.4 | |||
|
Diversified REITs |
12.8 | |||
|
Industrial REITs |
11.4 | |||
|
Office REITs |
10.2 | |||
|
Residential REITs |
4.7 | |||
|
Real Estate Development |
2.7 | |||
|
Health Care REITs |
1.9 | |||
|
Specialized REITs |
1.3 | |||
|
Other (each representing less than 1%) |
1.3 |
TEN LARGEST GEOGRAPHIC ALLOCATION
| Country/Geographic Region |
|
Percent of
Total Investments |
(a) |
|
|
Japan |
25.6 | % | ||
|
Germany |
13.3 | |||
|
Hong Kong |
12.8 | |||
|
United Kingdom |
10.3 | |||
|
Singapore |
7.5 | |||
|
Australia |
7.0 | |||
|
Canada |
6.1 | |||
|
Sweden |
4.8 | |||
|
France |
3.2 | |||
|
Switzerland |
2.8 |
| (a) |
Excludes money market funds. |
|
F U N D S U M M A R Y |
7 |
Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.
Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Since shares of a fund may not trade in the secondary market until after the fund’s inception, for the period from inception to the first day of secondary market trading in shares of the fund, the NAV of the fund is used as a proxy for the Market Price to calculate market returns. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.
An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.
As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses – The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes – The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| 8 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Cohen & Steers REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
|
Health Care REITs — 7.4% |
||||||||
|
Ventas Inc. |
1,310,518 | $ | 51,726,145 | |||||
|
Welltower Inc. |
1,466,498 | 78,853,598 | ||||||
|
|
|
|||||||
| 130,579,743 | ||||||||
| Hotel & Resort REITs — 1.5% | ||||||||
|
Host Hotels & Resorts Inc. |
2,476,718 | 25,956,005 | ||||||
|
|
|
|||||||
|
Industrial REITs — 11.0% |
||||||||
|
Duke Realty Corp. |
1,294,033 | 49,160,313 | ||||||
|
Prologis Inc. |
1,453,609 | 144,198,013 | ||||||
|
|
|
|||||||
| 193,358,326 | ||||||||
| Office REITs — 9.1% | ||||||||
|
Alexandria Real Estate Equities Inc. |
411,999 | 62,426,089 | ||||||
|
Boston Properties Inc. |
507,568 | 36,752,999 | ||||||
|
Cousins Properties Inc. |
521,164 | 13,279,259 | ||||||
|
Douglas Emmett Inc. |
579,085 | 13,666,406 | ||||||
|
Kilroy Realty Corp. |
371,443 | 17,487,536 | ||||||
|
Vornado Realty Trust |
557,636 | 17,136,154 | ||||||
|
|
|
|||||||
| 160,748,443 | ||||||||
| Residential REITs — 20.3% | ||||||||
|
American Campus Communities Inc. |
482,815 | 18,086,250 | ||||||
|
AvalonBay Communities Inc. |
494,352 | 68,779,194 | ||||||
|
Equity LifeStyle Properties Inc. |
595,074 | 35,222,430 | ||||||
|
Equity Residential |
1,228,753 | 57,726,816 | ||||||
|
Essex Property Trust Inc. |
229,793 | 47,013,350 | ||||||
|
Invitation Homes Inc. |
1,910,119 | 52,069,844 | ||||||
|
Sun Communities Inc. |
345,198 | 47,509,601 | ||||||
|
UDR Inc. |
1,035,860 | 32,360,266 | ||||||
|
|
|
|||||||
| 358,767,751 | ||||||||
| Retail REITs — 10.9% | ||||||||
|
Federal Realty Investment Trust |
246,788 | 16,974,079 | ||||||
|
National Retail Properties Inc. |
604,435 | 19,347,964 | ||||||
| Security | Shares | Value | ||||||
|
Retail REITs (continued) |
||||||||
|
Realty Income Corp. |
1,206,334 | $ | 69,798,485 | |||||
|
Regency Centers Corp. |
554,490 | 19,734,299 | ||||||
|
Simon Property Group Inc. |
1,074,012 | 67,458,694 | ||||||
|
|
|
|||||||
| 193,313,521 | ||||||||
| Specialized REITs — 39.7% | ||||||||
|
American Tower Corp. |
592,876 | 136,153,973 | ||||||
|
Digital Realty Trust Inc. |
942,516 | 136,005,059 | ||||||
|
Equinix Inc. |
192,915 | 141,067,165 | ||||||
|
Extra Space Storage Inc. |
453,450 | 52,577,527 | ||||||
|
Public Storage |
528,043 | 120,958,810 | ||||||
|
SBA Communications Corp. |
392,110 | 113,856,981 | ||||||
|
|
|
|||||||
| 700,619,515 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.9%
|
1,763,343,304 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.1% | ||||||||
|
BlackRock Cash Funds: Treasury,
|
2,040,000 | 2,040,000 | ||||||
|
|
|
|||||||
|
Total Short -Term Investments — 0.1%
|
|
2,040,000 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.0%
|
|
1,765,383,304 | ||||||
|
Other Assets, Less Liabilities — 0.0% |
|
627,566 | ||||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,766,010,870 | ||||||
|
|
|
|||||||
| (a) |
Affiliate of the Fund. |
| (b) |
Annualized 7-day yield as of period-end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional,
|
$ | 56,103,503 | $ | — | $ | (56,090,150 | )(b) | $ | 18,999 | $ | (32,352 | ) | $ | — | — | $ | 76,125 | (c) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
4,230,000 | — | (2,190,000 | )(b) | — | — | 2,040,000 | 2,040,000 | 2,619 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 18,999 | $ | (32,352 | ) | $ | 2,040,000 | $ | 78,744 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
As of period end, the entity is no longer held. |
| (b) |
Represents net amount purchased (sold). |
| (c) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
9 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Cohen & Steers REIT ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
Dow Jones U.S. Real Estate Index |
82 | 12/18/20 | $ | 2,487 | $ | (22,826 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 22,826 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 367,055 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (362,506 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 4,057,510 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,763,343,304 | $ | — | $ | — | $ | 1,763,343,304 | ||||||||
|
Money Market Funds |
2,040,000 | — | — | 2,040,000 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,765,383,304 | $ | — | $ | — | $ | 1,765,383,304 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (22,826 | ) | $ | — | $ | — | $ | (22,826 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 10 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Core U.S. REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Diversified REITs — 4.4% | ||||||||
|
Alexander & Baldwin Inc. |
123,214 | $ | 1,583,300 | |||||
|
American Assets Trust Inc. |
85,949 | 1,798,913 | ||||||
|
Armada Hoffler Properties Inc. |
98,265 | 885,368 | ||||||
|
Colony Capital Inc. |
822,823 | 2,929,250 | ||||||
|
Empire State Realty Trust Inc., Class A |
249,046 | 1,339,867 | ||||||
|
Essential Properties Realty Trust Inc. |
158,470 | 2,617,924 | ||||||
|
Gladstone Commercial Corp. |
57,708 | 937,755 | ||||||
|
Global Net Lease Inc. |
154,466 | 2,198,051 | ||||||
|
One Liberty Properties Inc. |
27,450 | 423,554 | ||||||
|
PS Business Parks Inc. |
34,441 | 3,927,307 | ||||||
|
STORE Capital Corp. |
401,480 | 10,318,036 | ||||||
|
VEREIT Inc. |
1,860,859 | 11,537,326 | ||||||
|
Washington REIT |
141,356 | 2,470,903 | ||||||
|
WP Carey Inc. |
294,897 | 18,463,501 | ||||||
|
|
|
|||||||
| 61,431,055 | ||||||||
| Health Care REITs — 11.4% | ||||||||
|
CareTrust REIT Inc. |
163,687 | 2,799,048 | ||||||
|
Community Healthcare Trust Inc. |
36,865 | 1,706,849 | ||||||
|
Diversified Healthcare Trust |
408,878 | 1,183,702 | ||||||
|
Global Medical REIT Inc. |
71,958 | 894,438 | ||||||
|
Healthcare Realty Trust Inc. |
231,510 | 6,435,978 | ||||||
|
Healthcare Trust of America Inc., Class A |
374,562 | 9,101,857 | ||||||
|
Healthpeak Properties Inc. |
929,635 | 25,072,256 | ||||||
|
LTC Properties Inc. |
66,406 | 2,192,062 | ||||||
|
Medical Properties Trust Inc. |
896,244 | 15,971,068 | ||||||
|
National Health Investors Inc. |
73,721 | 4,132,062 | ||||||
|
New Senior Investment Group Inc. |
140,628 | 549,855 | ||||||
|
Omega Healthcare Investors Inc. |
387,718 | 11,170,156 | ||||||
|
Physicians Realty Trust |
357,600 | 6,029,136 | ||||||
|
Sabra Health Care REIT Inc. |
351,974 | 4,631,978 | ||||||
|
Universal Health Realty Income Trust |
22,196 | 1,186,820 | ||||||
|
Ventas Inc. |
643,472 | 25,397,840 | ||||||
|
Welltower Inc. |
720,998 | 38,768,062 | ||||||
|
|
|
|||||||
| 157,223,167 | ||||||||
| Hotel & Resort REITs — 2.8% | ||||||||
|
Apple Hospitality REIT Inc. |
361,206 | 3,575,939 | ||||||
|
Chatham Lodging Trust |
79,025 | 580,834 | ||||||
|
CorePoint Lodging Inc. |
67,931 | 324,710 | ||||||
|
DiamondRock Hospitality Co. |
342,709 | 1,692,982 | ||||||
|
Hersha Hospitality Trust |
60,444 | 296,176 | ||||||
|
Host Hotels & Resorts Inc. |
1,204,874 | 12,627,080 | ||||||
|
Park Hotels & Resorts Inc. |
405,023 | 4,021,878 | ||||||
|
Pebblebrook Hotel Trust |
223,476 | 2,677,243 | ||||||
|
RLJ Lodging Trust |
281,236 | 2,300,511 | ||||||
|
Ryman Hospitality Properties Inc. |
86,274 | 3,438,019 | ||||||
|
Service Properties Trust |
281,341 | 2,028,469 | ||||||
|
Summit Hotel Properties Inc. |
176,030 | 929,438 | ||||||
|
Sunstone Hotel Investors Inc. |
368,296 | 2,732,756 | ||||||
|
Xenia Hotels & Resorts Inc. |
194,492 | 1,602,614 | ||||||
|
|
|
|||||||
| 38,828,649 | ||||||||
| Industrial REITs — 15.5% | ||||||||
|
Americold Realty Trust |
350,842 | 12,711,005 | ||||||
|
Duke Realty Corp. |
635,015 | 24,124,220 | ||||||
|
EastGroup Properties Inc. |
66,213 | 8,811,626 | ||||||
|
First Industrial Realty Trust Inc. |
217,507 | 8,658,954 | ||||||
|
Industrial Logistics Properties Trust |
111,413 | 2,136,901 | ||||||
|
Lexington Realty Trust |
468,616 | 4,653,357 | ||||||
|
Monmouth Real Estate Investment Corp. |
162,655 | 2,252,772 | ||||||
| Security | Shares | Value | ||||||
|
Industrial REITs (continued) |
||||||||
|
Plymouth Industrial REIT Inc. |
27,052 | $ | 343,831 | |||||
|
Prologis Inc. |
1,270,799 | 126,063,261 | ||||||
|
Rexford Industrial Realty Inc. |
212,842 | 9,888,639 | ||||||
|
STAG Industrial Inc. |
256,811 | 7,991,958 | ||||||
|
Terreno Realty Corp. |
114,249 | 6,429,934 | ||||||
|
|
|
|||||||
| 214,066,458 | ||||||||
| Office REITs — 9.1% | ||||||||
|
Alexandria Real Estate Equities Inc. |
215,882 | 32,710,441 | ||||||
|
Boston Properties Inc. |
268,138 | 19,415,873 | ||||||
|
Brandywine Realty Trust |
290,348 | 2,543,448 | ||||||
|
City Office REIT Inc. |
73,498 | 464,507 | ||||||
|
Columbia Property Trust Inc. |
196,498 | 2,078,949 | ||||||
|
Corporate Office Properties Trust |
193,426 | 4,338,545 | ||||||
|
Cousins Properties Inc. |
255,053 | 6,498,750 | ||||||
|
Douglas Emmett Inc. |
286,673 | 6,765,483 | ||||||
|
Easterly Government Properties Inc. |
137,107 | 2,865,536 | ||||||
|
Franklin Street Properties Corp. |
181,112 | 760,670 | ||||||
|
Highwoods Properties Inc. |
176,996 | 5,269,171 | ||||||
|
Hudson Pacific Properties Inc. |
258,800 | 4,984,488 | ||||||
|
JBG SMITH Properties |
209,878 | 4,900,651 | ||||||
|
Kilroy Realty Corp. |
198,007 | 9,322,170 | ||||||
|
Mack-Cali Realty Corp. |
148,982 | 1,637,312 | ||||||
|
Office Properties Income Trust |
82,197 | 1,513,247 | ||||||
|
Paramount Group Inc. |
324,964 | 1,878,292 | ||||||
|
Piedmont Office Realty Trust Inc., Class A |
216,227 | 2,469,312 | ||||||
|
SL Green Realty Corp. |
125,608 | 5,377,279 | ||||||
|
Vornado Realty Trust |
302,398 | 9,292,691 | ||||||
|
|
|
|||||||
| 125,086,815 | ||||||||
| Residential REITs — 17.8% | ||||||||
|
American Campus Communities Inc. |
235,886 | 8,836,289 | ||||||
|
American Homes 4 Rent, Class A |
447,333 | 12,646,104 | ||||||
|
Apartment Investment & Management Co., Class A |
255,121 | 8,138,360 | ||||||
|
AvalonBay Communities Inc. |
242,637 | 33,758,086 | ||||||
|
Bluerock Residential Growth REIT Inc. |
42,077 | 364,387 | ||||||
|
BRT Apartments Corp. |
18,511 | 230,462 | ||||||
|
Camden Property Trust |
162,561 | 14,994,627 | ||||||
|
Clipper Realty Inc. |
25,716 | 144,524 | ||||||
|
Equity LifeStyle Properties Inc. |
299,681 | 17,738,118 | ||||||
|
Equity Residential |
633,742 | 29,773,199 | ||||||
|
Essex Property Trust Inc. |
112,418 | 22,999,599 | ||||||
|
Front Yard Residential Corp. |
85,179 | 1,140,547 | ||||||
|
Independence Realty Trust Inc. |
162,014 | 1,968,470 | ||||||
|
Investors Real Estate Trust |
21,938 | 1,478,841 | ||||||
|
Invitation Homes Inc. |
967,188 | 26,365,545 | ||||||
|
Mid-America Apartment Communities Inc. |
196,333 | 22,898,318 | ||||||
|
NexPoint Residential Trust Inc. |
37,045 | 1,641,834 | ||||||
|
Preferred Apartment Communities Inc., Class A |
80,373 | 434,014 | ||||||
|
Sun Communities Inc. |
166,599 | 22,929,020 | ||||||
|
UDR Inc. |
504,869 | 15,772,107 | ||||||
|
UMH Properties Inc. |
62,884 | 857,109 | ||||||
|
|
|
|||||||
| 245,109,560 | ||||||||
| Retail REITs — 10.7% | ||||||||
|
Acadia Realty Trust |
144,922 | 1,352,122 | ||||||
|
Agree Realty Corp. |
91,281 | 5,665,812 | ||||||
|
Alexander’s Inc. |
3,674 | 893,480 | ||||||
|
American Finance Trust Inc. |
187,741 | 1,082,327 | ||||||
|
Brixmor Property Group Inc. |
509,790 | 5,587,298 | ||||||
|
Brookfield Property REIT Inc., Class A |
79,113 | 1,166,917 | ||||||
|
Federal Realty Investment Trust |
129,675 | 8,919,046 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
11 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core U.S. REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Retail REITs (continued) |
||||||||
|
Getty Realty Corp. |
58,335 | $ | 1,533,044 | |||||
|
Kimco Realty Corp. |
711,782 | 7,302,883 | ||||||
|
Kite Realty Group Trust |
142,699 | 1,478,362 | ||||||
|
Macerich Co. (The)(a) |
255,661 | 1,779,401 | ||||||
|
National Retail Properties Inc. |
295,142 | 9,447,495 | ||||||
|
Realty Income Corp. |
593,014 | 34,311,790 | ||||||
|
Regency Centers Corp. |
290,378 | 10,334,553 | ||||||
|
Retail Opportunity Investments Corp. |
197,706 | 1,923,679 | ||||||
|
Retail Properties of America Inc., Class A |
367,980 | 1,928,215 | ||||||
|
Retail Value Inc. |
28,165 | 352,062 | ||||||
|
RPT Realty |
138,719 | 678,336 | ||||||
|
Saul Centers Inc. |
20,725 | 512,944 | ||||||
|
Simon Property Group Inc. |
524,633 | 32,952,199 | ||||||
|
SITE Centers Corp. |
263,342 | 1,793,359 | ||||||
|
Spirit Realty Capital Inc. |
176,996 | 5,318,730 | ||||||
|
Tanger Factory Outlet Centers Inc.(a) |
155,921 | 965,151 | ||||||
|
Taubman Centers Inc. |
103,387 | 3,455,193 | ||||||
|
Urban Edge Properties |
199,185 | 1,872,339 | ||||||
|
Urstadt Biddle Properties Inc., Class A |
50,890 | 483,964 | ||||||
|
Washington Prime Group Inc.(a) |
328,674 | 192,439 | ||||||
|
Weingarten Realty Investors |
208,989 | 3,314,566 | ||||||
|
Whitestone REIT |
67,003 | 399,338 | ||||||
|
|
|
|||||||
| 146,997,044 | ||||||||
| Specialized REITs — 28.1% | ||||||||
|
CoreCivic Inc. |
205,973 | 1,320,287 | ||||||
|
CoreSite Realty Corp. |
69,257 | 8,266,516 | ||||||
|
CubeSmart |
332,894 | 11,295,093 | ||||||
|
CyrusOne Inc. |
201,026 | 14,282,897 | ||||||
|
Digital Realty Trust Inc. |
461,054 | 66,530,092 | ||||||
|
EPR Properties |
127,520 | 3,040,077 | ||||||
|
Equinix Inc. |
151,742 | 110,959,820 | ||||||
|
Extra Space Storage Inc. |
217,354 | 25,202,196 | ||||||
|
Farmland Partners Inc. |
44,460 | 286,322 | ||||||
|
Four Corners Property Trust Inc. |
120,565 | 3,055,117 | ||||||
|
Gaming and Leisure Properties Inc. |
354,780 | 12,896,253 | ||||||
|
GEO Group Inc. (The) |
201,175 | 1,782,411 | ||||||
|
Gladstone Land Corp. |
33,390 | 463,119 | ||||||
| Security | Shares | Value | ||||||
|
Specialized REITs (continued) |
||||||||
|
Iron Mountain Inc. |
492,891 | $ | 12,844,740 | |||||
|
Jernigan Capital Inc. |
38,073 | 658,282 | ||||||
|
Lamar Advertising Co., Class A |
148,121 | 9,177,577 | ||||||
|
Life Storage Inc. |
80,364 | 9,173,551 | ||||||
|
National Storage Affiliates Trust |
107,308 | 3,636,668 | ||||||
|
Outfront Media Inc. |
247,695 | 3,247,282 | ||||||
|
Public Storage |
260,032 | 59,565,530 | ||||||
|
QTS Realty Trust Inc., Class A |
104,904 | 6,452,645 | ||||||
|
Safehold Inc.(a) |
29,544 | 2,033,218 | ||||||
|
VICI Properties Inc. |
921,481 | 21,147,989 | ||||||
|
|
|
|||||||
| 387,317,682 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.8%
|
1,376,060,430 | |||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 0.3% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
2,839,351 | 2,841,339 | ||||||
|
BlackRock Cash Funds: Treasury,
|
1,650,000 | 1,650,000 | ||||||
|
|
|
|||||||
| 4,491,339 | ||||||||
|
|
|
|||||||
|
Total Short -Term Investments — 0.3%
|
|
4,491,339 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.1%
|
|
1,380,551,769 | ||||||
|
Other Assets, Less Liabilities — (0.1)% |
|
(1,758,718 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 1,378,793,051 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Affiliate of the Fund. |
| (c) |
Annualized 7-day yield as of period-end. |
| (d) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain Distributions from Underlying Funds |
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 32,937,842 | $ | — | $ | (30,084,865 | )(a) | $ | 4,869 | $ | (16,507 | ) | $ | 2,841,339 | 2,839,351 | $ | 155,729 | (b) | $ | — | ||||||||||||||||
|
BlackRock Cash Funds: Treasury,
|
3,157,000 | — | (1,507,000 | )(a) | — | — | 1,650,000 | 1,650,000 | 1,958 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | 4,869 | $ | (16,507 | ) | $ | 4,491,339 | $ | 157,687 | $ | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
| 12 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Core U.S. REIT ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
Dow Jones U.S. Real Estate Index |
85 | 12/18/20 | $ | 2,578 | $ | (34,799 | ) | |||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 34,799 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 660,229 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (394,628 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 3,990,343 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
|
|
||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 1,376,060,430 | $ | — | $ | — | $ | 1,376,060,430 | ||||||||
|
Money Market Funds |
4,491,339 | — | — | 4,491,339 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 1,380,551,769 | $ | — | $ | — | $ | 1,380,551,769 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(a) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (34,799 | ) | $ | — | $ | — | $ | (34,799 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
13 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® Global REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
||||||||
|
Australia — 4.0% |
||||||||
|
BWP Trust |
923,117 | $ | 2,599,519 | |||||
|
Charter Hall Long Wale REIT |
825,743 | 2,766,019 | ||||||
|
Charter Hall Retail REIT |
912,885 | 2,205,293 | ||||||
|
Cromwell Property Group |
3,063,329 | 1,882,320 | ||||||
|
Dexus |
2,044,562 | 12,362,186 | ||||||
|
GPT Group (The) |
3,649,190 | 10,327,456 | ||||||
|
Mirvac Group |
7,324,856 | 10,853,589 | ||||||
|
National Storage REIT |
1,834,134 | 2,324,878 | ||||||
|
Scentre Group |
9,721,147 | 14,336,022 | ||||||
|
Shopping Centres Australasia Property Group |
2,017,070 | 3,286,252 | ||||||
|
Stockland |
4,459,126 | 12,055,974 | ||||||
|
Vicinity Centres |
7,012,740 | 5,958,884 | ||||||
|
|
|
|||||||
| 80,958,392 | ||||||||
| Belgium — 1.5% | ||||||||
|
Aedifica SA |
61,671 | 6,206,754 | ||||||
|
Ascencio |
9,980 | 479,539 | ||||||
|
Befimmo SA |
40,761 | 1,585,846 | ||||||
|
Cofinimmo SA |
50,572 | 6,868,763 | ||||||
|
Intervest Offices & Warehouses NV |
42,800 | 1,056,938 | ||||||
|
Leasinvest Real Estate SCA |
4,639 | 369,616 | ||||||
|
Montea C.V.A. |
24,346 | 2,671,458 | ||||||
|
Retail Estates NV |
19,123 | 1,129,364 | ||||||
|
Warehouses De Pauw CVA |
251,047 | 8,398,646 | ||||||
|
Wereldhave Belgium Comm VA |
4,508 | 188,516 | ||||||
|
Xior Student Housing NV(a) |
28,856 | 1,638,629 | ||||||
|
|
|
|||||||
| 30,594,069 | ||||||||
| Canada — 3.3% | ||||||||
|
Allied Properties REIT |
228,425 | 5,535,240 | ||||||
|
Artis REIT |
223,523 | 1,398,119 | ||||||
|
Boardwalk REIT |
70,713 | 1,420,253 | ||||||
|
Canadian Apartment Properties REIT |
316,663 | 10,171,880 | ||||||
|
Choice Properties REIT |
482,097 | 4,349,666 | ||||||
|
Cominar REIT |
314,975 | 1,677,221 | ||||||
|
Crombie REIT(a) |
175,873 | 1,714,740 | ||||||
|
Dream Industrial REIT |
287,794 | 2,553,420 | ||||||
|
Dream Office REIT |
79,709 | 1,046,765 | ||||||
|
First Capital Real Estate Investment Trust |
395,080 | 3,502,340 | ||||||
|
Granite REIT |
108,510 | 6,079,197 | ||||||
|
H&R Real Estate Investment Trust |
528,468 | 4,058,584 | ||||||
|
InterRent REIT |
212,676 | 1,811,977 | ||||||
|
Killam Apartment REIT |
183,086 | 2,198,378 | ||||||
|
Northview Apartment Real Estate Investment Trust(a) |
109,630 | 2,969,840 | ||||||
|
NorthWest Healthcare Properties REIT |
286,475 | 2,451,479 | ||||||
|
RioCan REIT |
592,342 | 6,388,329 | ||||||
|
SmartCentres Real Estate Investment Trust |
245,035 | 3,870,279 | ||||||
|
Summit Industrial Income REIT |
236,164 | 2,385,817 | ||||||
|
WPT Industrial Real Estate Investment Trust |
102,093 | 1,322,104 | ||||||
|
|
|
|||||||
| 66,905,628 | ||||||||
| China — 0.1% | ||||||||
|
Yuexiu REIT |
2,381,000 | 1,096,110 | ||||||
|
|
|
|||||||
| France — 1.8% | ||||||||
|
Carmila SA |
70,746 | 547,192 | ||||||
|
Covivio |
93,890 | 5,588,691 | ||||||
|
Gecina SA |
97,177 | 12,066,755 | ||||||
|
ICADE |
60,002 | 3,033,369 | ||||||
|
Klepierre SA |
353,374 | 4,476,449 | ||||||
|
Mercialys SA |
115,166 | 551,361 | ||||||
| Security | Shares | Value | ||||||
|
France (continued) |
||||||||
|
Unibail-Rodamco-Westfield |
251,754 | $ | 10,234,618 | |||||
|
|
|
|||||||
| 36,498,435 | ||||||||
| Germany — 0.3% | ||||||||
|
alstria office REIT-AG |
333,757 | 4,249,329 | ||||||
|
Hamborner REIT AG |
140,942 | 1,315,544 | ||||||
|
|
|
|||||||
| 5,564,873 | ||||||||
| Hong Kong — 1.6% | ||||||||
|
Champion REIT |
3,738,000 | 1,807,579 | ||||||
|
Hui Xian Real Estate Investment Trust(a) |
4,481,000 | 1,090,764 | ||||||
|
Link REIT |
3,852,300 | 29,333,683 | ||||||
|
|
|
|||||||
| 32,232,026 | ||||||||
| Ireland — 0.1% | ||||||||
|
Hibernia REIT PLC |
1,286,737 | 1,552,814 | ||||||
|
Irish Residential Properties REIT PLC |
825,650 | 1,317,608 | ||||||
|
|
|
|||||||
| 2,870,422 | ||||||||
| Italy — 0.0% | ||||||||
|
Immobiliare Grande Distribuzione SIIQ SpA |
139,910 | 406,620 | ||||||
|
|
|
|||||||
|
Japan — 9.6% |
||||||||
|
Activia Properties Inc. |
1,289 | 4,648,489 | ||||||
|
Advance Residence Investment Corp. |
2,402 | 7,007,939 | ||||||
|
AEON REIT Investment Corp. |
2,912 | 3,286,933 | ||||||
|
Comforia Residential REIT Inc. |
1,129 | 3,226,948 | ||||||
|
Daiwa House REIT Investment Corp. |
3,754 | 8,686,556 | ||||||
|
Daiwa Office Investment Corp. |
510 | 2,766,118 | ||||||
|
Daiwa Securities Living Investments Corp. |
3,501 | 3,419,285 | ||||||
|
Frontier Real Estate Investment Corp. |
846 | 2,828,362 | ||||||
|
Fukuoka REIT Corp. |
1,346 | 1,626,170 | ||||||
|
Global One Real Estate Investment Corp. |
1,822 | 1,641,787 | ||||||
|
GLP J-REIT |
7,041 | 10,843,706 | ||||||
|
Hulic Reit Inc. |
2,174 | 2,853,193 | ||||||
|
Ichigo Office REIT Investment Corp. |
2,252 | 1,454,085 | ||||||
|
Industrial & Infrastructure Fund Investment Corp. |
3,535 | 6,005,510 | ||||||
|
Invesco Office J-Reit Inc. |
16,351 | 2,023,933 | ||||||
|
Invincible Investment Corp. |
9,107 | 2,896,573 | ||||||
|
Japan Excellent Inc. |
2,343 | 2,577,434 | ||||||
|
Japan Hotel REIT Investment Corp. |
8,311 | 3,998,884 | ||||||
|
Japan Logistics Fund Inc. |
1,606 | 4,502,761 | ||||||
|
Japan Prime Realty Investment Corp. |
1,647 | 4,450,713 | ||||||
|
Japan Real Estate Investment Corp. |
2,434 | 11,920,872 | ||||||
|
Japan Retail Fund Investment Corp. |
4,877 | 7,011,795 | ||||||
|
Kenedix Office Investment Corp. |
710 | 4,102,162 | ||||||
|
Kenedix Residential Next Investment Corp. |
1,747 | 2,852,620 | ||||||
|
Kenedix Retail REIT Corp. |
1,002 | 1,909,302 | ||||||
|
LaSalle Logiport REIT |
3,049 | 4,742,370 | ||||||
|
MCUBS MidCity Investment Corp. |
3,111 | 2,225,969 | ||||||
|
Mitsubishi Estate Logistics REIT Investment Corp. |
552 | 2,196,595 | ||||||
|
Mitsui Fudosan Logistics Park Inc. |
766 | 3,656,342 | ||||||
|
Mori Hills REIT Investment Corp. |
2,852 | 3,505,663 | ||||||
|
Mori Trust Sogo REIT Inc. |
1,867 | 2,225,255 | ||||||
|
Nippon Accommodations Fund Inc. |
827 | 4,730,687 | ||||||
|
Nippon Building Fund Inc. |
2,756 | 13,919,724 | ||||||
|
Nippon Prologis REIT Inc. |
3,997 | 13,152,554 | ||||||
|
Nippon REIT Investment Corp. |
809 | 2,588,583 | ||||||
|
Nomura Real Estate Master Fund Inc. |
8,399 | 10,010,670 | ||||||
|
Orix JREIT Inc. |
4,932 | 6,911,594 | ||||||
|
Premier Investment Corp. |
2,369 | 2,599,238 | ||||||
|
Sekisui House Reit Inc. |
7,543 | 5,267,257 | ||||||
|
Tokyu REIT Inc. |
1,658 | 2,248,942 | ||||||
| 14 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Global REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Japan (continued) |
||||||||
|
United Urban Investment Corp. |
5,505 | $ | 5,860,977 | |||||
|
|
|
|||||||
| 194,384,550 | ||||||||
| Malaysia — 0.2% | ||||||||
|
Axis Real Estate Investment Trust |
2,218,500 | 1,121,264 | ||||||
|
IGB REIT |
3,354,200 | 1,348,138 | ||||||
|
Pavilion REIT |
1,592,800 | 532,850 | ||||||
|
Sunway REIT |
3,330,600 | 1,146,271 | ||||||
|
|
|
|||||||
| 4,148,523 | ||||||||
| Mexico — 0.5% | ||||||||
|
Concentradora Fibra Danhos SA de CV |
463,915 | 418,619 | ||||||
|
Fibra Uno Administracion SA de CV |
5,530,213 | 4,176,737 | ||||||
|
Macquarie Mexico Real Estate Management SA de CV(b) |
1,434,450 | 1,642,935 | ||||||
|
PLA Administradora Industrial S. de RL de
|
1,557,509 | 2,131,578 | ||||||
|
Prologis Property Mexico SA de CV |
894,948 | 1,787,583 | ||||||
|
|
|
|||||||
| 10,157,452 | ||||||||
| Netherlands — 0.2% | ||||||||
|
Eurocommercial Properties NV |
88,043 | 959,932 | ||||||
|
NSI NV |
34,472 | 1,092,208 | ||||||
|
Vastned Retail NV |
31,957 | 845,010 | ||||||
|
Wereldhave NV(a) |
75,036 | 697,497 | ||||||
|
|
|
|||||||
| 3,594,647 | ||||||||
| New Zealand — 0.3% | ||||||||
|
Goodman Property Trust |
2,084,273 | 3,416,191 | ||||||
|
Kiwi Property Group Ltd. |
3,142,297 | 2,554,395 | ||||||
|
|
|
|||||||
| 5,970,586 | ||||||||
| Saudi Arabia — 0.1% | ||||||||
|
Al Maather REIT Fund |
56,989 | 138,434 | ||||||
|
Al Rajhi REIT |
209,416 | 510,376 | ||||||
|
Alahli REIT Fund 1 |
80,921 | 185,564 | ||||||
|
Alkhabeer REIT, NVS |
47,861 | 117,920 | ||||||
|
Jadwa REIT Saudi Fund |
246,784 | 855,450 | ||||||
|
Musharaka Real Estate Income Fund, NVS |
124,786 | 296,135 | ||||||
|
Riyad REIT Fund |
277,831 | 598,585 | ||||||
|
Sedco Capital REIT Fund |
60,052 | 142,832 | ||||||
|
|
|
|||||||
| 2,845,296 | ||||||||
| Singapore — 3.7% | ||||||||
|
Ascendas REIT |
5,506,118 | 11,613,050 | ||||||
|
Ascott Residence Trust(a) |
3,411,932 | 2,073,895 | ||||||
|
CapitaLand Mall Trust |
8,157,026 | 10,334,423 | ||||||
|
CapitaLand Retail China Trust |
1,412,004 | 1,209,846 | ||||||
|
CDL Hospitality Trusts |
1,467,100 | 1,063,661 | ||||||
|
First REIT |
994,500 | 291,322 | ||||||
|
Fortune REIT |
2,583,000 | 2,151,709 | ||||||
|
Frasers Centrepoint Trust(a) |
1,995,870 | 3,084,061 | ||||||
|
Frasers Logistics & Commercial Trust(a) |
4,697,000 | 4,230,912 | ||||||
|
Keppel DC REIT(a) |
2,282,233 | 4,846,925 | ||||||
|
Keppel REIT(a) |
3,711,000 | 2,704,097 | ||||||
|
Lippo Malls Indonesia Retail Trust(a) |
4,423,900 | 285,099 | ||||||
|
Manulife US Real Estate Investment Trust |
2,700,800 | 1,931,072 | ||||||
|
Mapletree Commercial Trust(a) |
4,105,491 | 5,171,325 | ||||||
|
Mapletree Industrial Trust |
3,069,400 | 6,833,377 | ||||||
|
Mapletree Logistics Trust(a) |
4,815,640 | 6,876,967 | ||||||
|
Mapletree North Asia Commercial Trust |
4,379,400 | 2,790,244 | ||||||
|
Parkway Life REIT |
722,800 | 2,143,786 | ||||||
|
Sasseur Real Estate Investment Trust |
1,106,100 | 607,525 | ||||||
|
Suntec REIT |
3,887,500 | 3,814,903 | ||||||
|
|
|
|||||||
| 74,058,199 | ||||||||
| Security | Shares | Value | ||||||
|
South Africa — 0.4% |
||||||||
|
Attacq Ltd. |
1,428,067 | $ | 272,452 | |||||
|
Emira Property Fund Ltd. |
733,547 | 281,252 | ||||||
|
Equites Property Fund Ltd. |
1,034,927 | 991,696 | ||||||
|
Growthpoint Properties Ltd. |
5,640,683 | 3,683,215 | ||||||
|
Redefine Properties Ltd. |
10,598,262 | 1,297,979 | ||||||
|
SA Corporate Real Estate Ltd. |
4,706,533 | 350,483 | ||||||
|
Stor-Age Property REIT Ltd. |
602,716 | 441,408 | ||||||
|
Vukile Property Fund Ltd. |
1,658,974 | 490,073 | ||||||
|
|
|
|||||||
| 7,808,558 | ||||||||
| Spain — 0.4% | ||||||||
|
Inmobiliaria Colonial Socimi SA |
616,647 | 4,385,227 | ||||||
|
Lar Espana Real Estate Socimi SA |
115,248 | 410,794 | ||||||
|
Merlin Properties Socimi SA |
624,473 | 4,200,834 | ||||||
|
|
|
|||||||
| 8,996,855 | ||||||||
| Thailand — 0.1% | ||||||||
|
WHA Premium Growth Freehold & Leasehold Real Estate InvestmentTrust(a) |
2,446,802 | 997,013 | ||||||
|
|
|
|||||||
| Turkey — 0.1% | ||||||||
|
AKIS Gayrimenkul Yatirimi AS(c) |
312,826 | 148,147 | ||||||
|
Emlak Konut Gayrimenkul Yatirim Ortakligi AS(a) |
3,498,854 | 717,885 | ||||||
|
Halk Gayrimenkul Yatirim Ortakligi AS |
366,553 | 99,695 | ||||||
|
Is Gayrimenkul Yatirim Ortakligi AS(c) |
833,587 | 188,932 | ||||||
|
Torunlar Gayrimenkul Yatirim Ortakligi AS(c) |
262,571 | 105,868 | ||||||
|
|
|
|||||||
| 1,260,527 | ||||||||
| United Kingdom — 5.4% | ||||||||
|
Assura PLC |
4,910,115 | 4,837,771 | ||||||
|
Big Yellow Group PLC |
304,728 | 4,334,147 | ||||||
|
BMO Commercial Property Trust |
946,890 | 752,962 | ||||||
|
BMO Real Estate Investments Ltd. |
444,886 | 319,832 | ||||||
|
British Land Co. PLC (The) |
1,741,458 | 7,849,446 | ||||||
|
Capital & Counties Properties PLC |
1,370,691 | 1,853,830 | ||||||
|
Civitas Social Housing PLC |
1,177,900 | 1,583,946 | ||||||
|
Custodian REIT PLC |
727,350 | 802,216 | ||||||
|
Derwent London PLC |
188,816 | 6,489,219 | ||||||
|
Empiric Student Property PLC |
1,098,185 | 766,775 | ||||||
|
GCP Student Living PLC |
864,513 | 1,251,953 | ||||||
|
Great Portland Estates PLC |
479,211 | 3,575,207 | ||||||
|
Hammerson PLC(a)(c) |
7,147,643 | 1,506,893 | ||||||
|
Impact Healthcare REIT PLC |
447,758 | 573,162 | ||||||
|
Land Securities Group PLC |
1,335,948 | 8,797,553 | ||||||
|
LondonMetric Property PLC |
1,659,380 | 4,630,159 | ||||||
|
LXI REIT PLC |
978,354 | 1,383,923 | ||||||
|
NewRiver REIT PLC |
564,942 | 463,849 | ||||||
|
Picton Property Income Ltd. (The) |
1,014,508 | 817,226 | ||||||
|
Primary Health Properties PLC |
2,426,804 | 4,518,516 | ||||||
|
RDI REIT PLC |
491,114 | 563,889 | ||||||
|
Regional REIT Ltd.(b) |
680,194 | 548,802 | ||||||
|
Safestore Holdings PLC |
386,873 | 4,019,323 | ||||||
|
Schroder REIT Ltd. |
1,004,953 | 400,217 | ||||||
|
Segro PLC |
2,228,617 | 25,992,055 | ||||||
|
Shaftesbury PLC |
422,036 | 2,482,902 | ||||||
|
Shaftesbury PLC, New |
50,756 | 36,095 | ||||||
|
Standard Life Investment Property Income Trust Ltd. |
674,561 | 462,270 | ||||||
|
Target Healthcare REIT PLC |
858,982 | 1,188,410 | ||||||
|
Triple Point Social Housing REIT PLC(b) |
693,202 | 945,608 | ||||||
|
Tritax Big Box REIT PLC |
3,203,931 | 6,487,443 | ||||||
|
UK Commercial Property REIT Ltd. |
1,379,041 | 1,216,075 | ||||||
|
UNITE Group PLC (The)(c) |
599,124 | 6,452,981 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
15 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Global REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
United Kingdom (continued) |
||||||||
|
Workspace Group PLC |
249,642 | $ | 1,991,597 | |||||
|
|
|
|||||||
| 109,896,252 | ||||||||
| United States — 65.8% | ||||||||
|
Acadia Realty Trust |
156,000 | 1,455,480 | ||||||
|
Agree Realty Corp. |
97,827 | 6,072,122 | ||||||
|
Alexander’s Inc. |
4,115 | 1,000,727 | ||||||
|
Alexandria Real Estate Equities Inc. |
234,084 | 35,468,408 | ||||||
|
American Assets Trust Inc. |
93,333 | 1,953,460 | ||||||
|
American Campus Communities Inc. |
255,308 | 9,563,838 | ||||||
|
American Finance Trust Inc. |
203,730 | 1,174,503 | ||||||
|
American Homes 4 Rent, Class A |
485,059 | 13,712,618 | ||||||
|
Americold Realty Trust |
380,428 | 13,782,906 | ||||||
|
Apartment Investment & Management Co., Class A |
276,635 | 8,824,657 | ||||||
|
Apple Hospitality REIT Inc. |
390,300 | 3,863,970 | ||||||
|
Armada Hoffler Properties Inc. |
106,836 | 962,592 | ||||||
|
AvalonBay Communities Inc. |
263,097 | 36,604,686 | ||||||
|
Boston Properties Inc. |
290,749 | 21,053,135 | ||||||
|
Brandywine Realty Trust |
317,891 | 2,784,725 | ||||||
|
Brixmor Property Group Inc. |
551,517 | 6,044,626 | ||||||
|
Brookfield Property REIT Inc., Class A(a) |
85,406 | 1,259,739 | ||||||
|
Camden Property Trust |
176,266 | 16,258,776 | ||||||
|
CareTrust REIT Inc. |
176,049 | 3,010,438 | ||||||
|
Colony Capital Inc. |
891,830 | 3,174,915 | ||||||
|
Columbia Property Trust Inc. |
214,698 | 2,271,505 | ||||||
|
Community Healthcare Trust Inc. |
40,078 | 1,855,611 | ||||||
|
Corporate Office Properties Trust |
209,145 | 4,691,122 | ||||||
|
Cousins Properties Inc. |
276,559 | 7,046,723 | ||||||
|
CubeSmart |
361,063 | 12,250,868 | ||||||
|
CyrusOne Inc. |
217,975 | 15,487,124 | ||||||
|
DiamondRock Hospitality Co. |
371,737 | 1,836,381 | ||||||
|
Digital Realty Trust Inc. |
499,934 | 72,140,476 | ||||||
|
Diversified Healthcare Trust |
441,723 | 1,278,788 | ||||||
|
Douglas Emmett Inc. |
311,353 | 7,347,931 | ||||||
|
Duke Realty Corp. |
688,566 | 26,158,622 | ||||||
|
Easterly Government Properties Inc. |
148,901 | 3,112,031 | ||||||
|
EastGroup Properties Inc. |
71,912 | 9,570,049 | ||||||
|
Empire State Realty Trust Inc., Class A |
271,905 | 1,462,849 | ||||||
|
EPR Properties |
136,981 | 3,265,627 | ||||||
|
Equity Commonwealth |
218,646 | 5,776,627 | ||||||
|
Equity LifeStyle Properties Inc. |
324,951 | 19,233,850 | ||||||
|
Equity Residential |
687,191 | 32,284,233 | ||||||
|
Essential Properties Realty Trust Inc. |
170,299 | 2,813,340 | ||||||
|
Essex Property Trust Inc. |
121,897 | 24,938,907 | ||||||
|
Extra Space Storage Inc. |
235,680 | 27,327,096 | ||||||
|
Federal Realty Investment Trust |
140,380 | 9,655,336 | ||||||
|
First Industrial Realty Trust Inc. |
235,956 | 9,393,408 | ||||||
|
Four Corners Property Trust Inc. |
130,944 | 3,318,121 | ||||||
|
Franklin Street Properties Corp. |
193,295 | 811,839 | ||||||
|
Gaming and Leisure Properties Inc. |
384,727 | 13,984,826 | ||||||
|
Getty Realty Corp. |
63,524 | 1,669,411 | ||||||
|
Global Net Lease Inc. |
167,619 | 2,385,218 | ||||||
|
Healthcare Realty Trust Inc. |
251,439 | 6,990,004 | ||||||
|
Healthcare Trust of America Inc., Class A |
406,149 | 9,869,421 | ||||||
|
Healthpeak Properties Inc. |
1,007,167 | 27,163,294 | ||||||
|
Highwoods Properties Inc. |
192,603 | 5,733,791 | ||||||
|
Host Hotels & Resorts Inc.(a) |
1,307,463 | 13,702,212 | ||||||
|
Hudson Pacific Properties Inc. |
281,350 | 5,418,801 | ||||||
|
Independence Realty Trust Inc. |
178,996 | 2,174,801 | ||||||
|
Industrial Logistics Properties Trust |
124,028 | 2,378,857 | ||||||
|
Innovative Industrial Properties Inc. |
39,246 | 4,577,261 | ||||||
| Security | Shares | Value | ||||||
|
United States (continued) |
||||||||
|
Investors Real Estate Trust |
24,108 | $ | 1,625,120 | |||||
|
Invitation Homes Inc. |
1,048,759 | 28,589,170 | ||||||
|
JBG SMITH Properties |
228,170 | 5,327,770 | ||||||
|
Kilroy Realty Corp. |
214,953 | 10,119,987 | ||||||
|
Kimco Realty Corp. |
768,185 | 7,881,578 | ||||||
|
Kite Realty Group Trust |
154,082 | 1,596,290 | ||||||
|
Lexington Realty Trust |
508,296 | 5,047,379 | ||||||
|
Life Storage Inc. |
86,986 | 9,929,452 | ||||||
|
LTC Properties Inc. |
72,118 | 2,380,615 | ||||||
|
Macerich Co. (The)(a) |
277,949 | 1,934,525 | ||||||
|
Mack-Cali Realty Corp. |
165,009 | 1,813,449 | ||||||
|
Medical Properties Trust Inc. |
971,830 | 17,318,011 | ||||||
|
Mid-America Apartment Communities Inc. |
212,890 | 24,829,361 | ||||||
|
Monmouth Real Estate Investment Corp. |
180,555 | 2,500,687 | ||||||
|
National Health Investors Inc. |
79,937 | 4,480,469 | ||||||
|
National Retail Properties Inc. |
320,001 | 10,243,232 | ||||||
|
National Storage Affiliates Trust |
117,035 | 3,966,316 | ||||||
|
NexPoint Residential Trust Inc. |
40,229 | 1,782,949 | ||||||
|
Office Properties Income Trust |
90,112 | 1,658,962 | ||||||
|
Omega Healthcare Investors Inc. |
419,738 | 12,092,652 | ||||||
|
Paramount Group Inc. |
357,926 | 2,068,812 | ||||||
|
Park Hotels & Resorts Inc. |
436,617 | 4,335,607 | ||||||
|
Pebblebrook Hotel Trust(a) |
240,047 | 2,875,763 | ||||||
|
Physicians Realty Trust |
387,758 | 6,537,600 | ||||||
|
Piedmont Office Realty Trust Inc., Class A |
234,143 | 2,673,913 | ||||||
|
Prologis Inc. |
1,377,972 | 136,694,822 | ||||||
|
PS Business Parks Inc. |
37,341 | 4,257,994 | ||||||
|
Public Storage |
281,956 | 64,587,661 | ||||||
|
QTS Realty Trust Inc., Class A |
113,849 | 7,002,852 | ||||||
|
Realty Income Corp. |
641,990 | 37,145,541 | ||||||
|
Regency Centers Corp. |
314,865 | 11,206,045 | ||||||
|
Retail Opportunity Investments Corp. |
214,591 | 2,087,970 | ||||||
|
Retail Properties of America Inc., Class A |
393,607 | 2,062,501 | ||||||
|
Rexford Industrial Realty Inc. |
230,917 | 10,728,404 | ||||||
|
RLJ Lodging Trust |
305,720 | 2,500,790 | ||||||
|
RPT Realty |
150,463 | 735,764 | ||||||
|
Ryman Hospitality Properties Inc. |
92,963 | 3,704,576 | ||||||
|
Sabra Health Care REIT Inc. |
379,717 | 4,997,076 | ||||||
|
Safehold Inc. |
32,408 | 2,230,319 | ||||||
|
Service Properties Trust |
306,610 | 2,210,658 | ||||||
|
Simon Property Group Inc. |
567,956 | 35,673,316 | ||||||
|
SITE Centers Corp. |
284,517 | 1,937,561 | ||||||
|
SL Green Realty Corp. |
136,619 | 5,848,659 | ||||||
|
Spirit Realty Capital Inc. |
192,175 | 5,774,859 | ||||||
|
STAG Industrial Inc. |
279,455 | 8,696,640 | ||||||
|
STORE Capital Corp. |
434,633 | 11,170,068 | ||||||
|
Summit Hotel Properties Inc. |
192,445 | 1,016,110 | ||||||
|
Sun Communities Inc. |
180,644 | 24,862,034 | ||||||
|
Sunstone Hotel Investors Inc. |
403,394 | 2,993,184 | ||||||
|
Tanger Factory Outlet Centers Inc.(a) |
168,545 | 1,043,294 | ||||||
|
Taubman Centers Inc. |
111,991 | 3,742,739 | ||||||
|
Terreno Realty Corp. |
124,165 | 6,988,006 | ||||||
|
UDR Inc. |
547,008 | 17,088,530 | ||||||
|
Universal Health Realty Income Trust |
23,886 | 1,277,184 | ||||||
|
Urban Edge Properties |
215,107 | 2,022,006 | ||||||
|
Ventas Inc. |
697,740 | 27,539,798 | ||||||
|
VEREIT Inc. |
2,017,802 | 12,510,372 | ||||||
|
VICI Properties Inc. |
999,197 | 22,931,571 | ||||||
|
Vornado Realty Trust |
328,266 | 10,087,614 | ||||||
|
Washington REIT |
153,461 | 2,682,498 | ||||||
| 16 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Global REIT ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
United States (continued) |
||||||||
|
Weingarten Realty Investors |
223,392 | $ | 3,542,997 | |||||
|
Welltower Inc. |
781,802 | 42,037,494 | ||||||
|
WP Carey Inc. |
319,248 | 19,988,117 | ||||||
|
Xenia Hotels & Resorts Inc. |
210,859 | 1,737,478 | ||||||
|
|
|
|||||||
| 1,328,357,453 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.5%
|
2,009,602,486 | |||||||
|
|
|
|||||||
|
Rights |
|
|||||||
| Singapore — 0.0% | ||||||||
|
Mapletree Logistics Trust (Expires 12/11/20)(a)(c) |
91,177 | 0 | (d) | |||||
|
|
|
|||||||
|
Total Rights — 0.0%
|
0 | (d) | ||||||
|
|
|
|||||||
|
Short-Term Investments |
|
|||||||
|
Money Market Funds — 0.7% |
||||||||
|
BlackRock Cash Funds: Institutional,
|
11,297,247 | 11,305,156 | ||||||
|
BlackRock Cash Funds: Treasury,
|
2,780,000 | 2,780,000 | ||||||
|
|
|
|||||||
| 14,085,156 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 0.7%
|
|
14,085,156 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 100.2%
|
|
2,023,687,642 | ||||||
|
Other Assets, Less Liabilities — (0.2)% |
|
(3,774,369 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 2,019,913,273 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) |
Non-income producing security. |
| (d) |
Rounds to less than $1. |
| (e) |
Affiliate of the Fund. |
| (f) |
Annualized 7-day yield as of period-end. |
| (g) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 32,298,609 | $ | — | $ | (20,974,912 | )(a) | $ | (2,957 | ) | $ | (15,584 | ) | $ | 11,305,156 | 11,297,247 | $ | 491,840 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
3,440,000 | — | (660,000 | )(a) | — | — | 2,780,000 | 2,780,000 | 2,845 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (2,957 | ) | $ | (15,584 | ) | $ | 14,085,156 | $ | 494,685 | $ | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
|
S C H E D U L E O F I N V E S T M E N T S |
17 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Global REIT ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
ASX SPI 200 Index |
9 | 12/17/20 | $ | 931 | $ | 741 | ||||||||||
|
Dow Jones U.S. Real Estate Index |
264 | 12/18/20 | 8,007 | (255,701 | ) | |||||||||||
|
|
|
|||||||||||||||
| $ | (254,960 | ) | ||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Assets — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized appreciation on futures contracts(a) |
$ | 741 | ||
|
|
|
|||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
255,701 | |||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 1,260,166 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (802,186 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 9,351,576 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
| 18 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® Global REIT ETF |
Fair Value Measurements (continued)
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 2,009,566,391 | $ | 36,095 | $ | — | $ | 2,009,602,486 | ||||||||
|
Rights |
— | 0 | (a) | — | 0 | (a) | ||||||||||
|
Money Market Funds |
14,085,156 | — | — | 14,085,156 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 2,023,651,547 | $ | 36,095 | $ | — | $ | 2,023,687,642 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(b) |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Futures Contracts |
$ | 741 | $ | — | $ | — | $ | 741 | ||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
(255,701 | ) | — | — | (255,701 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | (254,960 | ) | $ | — | $ | — | $ | (254,960 | ) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Rounds to less than $1. |
| (b) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
|
S C H E D U L E O F I N V E S T M E N T S |
19 |
|
Schedule of Investments (unaudited) October 31, 2020 |
iShares® International Developed Real Estate ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
|
Common Stocks |
|
|||||||
| Australia — 7.0% | ||||||||
|
BWP Trust |
180,687 | $ | 508,819 | |||||
|
Charter Hall Long Wale REIT |
161,183 | 539,920 | ||||||
|
Charter Hall Retail REIT |
176,951 | 427,468 | ||||||
|
Cromwell Property Group |
547,387 | 336,352 | ||||||
|
Dexus |
402,902 | 2,436,096 | ||||||
|
GPT Group (The) |
720,417 | 2,038,829 | ||||||
|
Mirvac Group |
1,453,319 | 2,153,452 | ||||||
|
National Storage REIT |
354,132 | 448,884 | ||||||
|
Scentre Group |
1,917,777 | 2,828,194 | ||||||
|
Shopping Centres Australasia Property Group |
395,163 | 643,808 | ||||||
|
Stockland |
881,029 | 2,382,006 | ||||||
|
Vicinity Centres |
1,386,254 | 1,177,931 | ||||||
|
|
|
|||||||
| 15,921,759 | ||||||||
| Austria — 0.3% | ||||||||
|
CA Immobilien Anlagen AG |
25,361 | 695,708 | ||||||
|
|
|
|||||||
| Belgium — 2.8% | ||||||||
|
Aedifica SA |
12,151 | 1,222,913 | ||||||
|
Ascencio |
1,883 | 90,478 | ||||||
|
Befimmo SA |
7,851 | 305,451 | ||||||
|
Cofinimmo SA |
9,986 | 1,356,313 | ||||||
|
Intervest Offices & Warehouses NV |
8,204 | 202,596 | ||||||
|
Leasinvest Real Estate SCA |
881 | 70,194 | ||||||
|
Montea C.V.A. |
4,785 | 525,053 | ||||||
|
Retail Estates NV |
3,747 | 221,290 | ||||||
|
Shurgard Self Storage SA |
8,839 | 376,838 | ||||||
|
Warehouses De Pauw CVA |
49,352 | 1,651,045 | ||||||
|
Wereldhave Belgium Comm VA |
850 | 35,545 | ||||||
|
Xior Student Housing NV(a) |
5,638 | 320,162 | ||||||
|
|
|
|||||||
| 6,377,878 | ||||||||
| Canada — 6.0% | ||||||||
|
Allied Properties REIT |
44,932 | 1,088,801 | ||||||
|
Artis REIT |
42,651 | 266,779 | ||||||
|
Boardwalk REIT |
13,677 | 274,699 | ||||||
|
Canadian Apartment Properties REIT |
62,305 | 2,001,367 | ||||||
|
Chartwell Retirement Residences |
79,416 | 569,406 | ||||||
|
Choice Properties REIT |
94,152 | 849,476 | ||||||
|
Cominar REIT |
62,708 | 333,916 | ||||||
|
Crombie REIT(a) |
34,438 | 335,766 | ||||||
|
Dream Industrial REIT |
55,328 | 490,891 | ||||||
|
Dream Office REIT |
16,098 | 211,404 | ||||||
|
First Capital Real Estate Investment Trust |
79,438 | 704,209 | ||||||
|
Granite REIT |
21,301 | 1,193,374 | ||||||
|
H&R Real Estate Investment Trust |
103,576 | 795,454 | ||||||
|
InterRent REIT |
41,849 | 356,549 | ||||||
|
Killam Apartment REIT |
36,049 | 432,853 | ||||||
|
Northview Apartment Real Estate Investment Trust |
21,288 | 576,685 | ||||||
|
NorthWest Healthcare Properties REIT |
55,837 | 477,819 | ||||||
|
RioCan REIT |
116,928 | 1,261,053 | ||||||
|
SmartCentres Real Estate Investment Trust |
47,464 | 749,684 | ||||||
|
Summit Industrial Income REIT |
46,474 | 469,498 | ||||||
|
WPT Industrial Real Estate Investment Trust |
19,884 | 257,498 | ||||||
|
|
|
|||||||
| 13,697,181 | ||||||||
| Finland — 0.8% | ||||||||
|
Citycon OYJ(a) |
28,989 | 223,205 | ||||||
|
Kojamo OYJ |
71,754 | 1,479,412 | ||||||
|
|
|
|||||||
| 1,702,617 | ||||||||
| Security | Shares | Value | ||||||
| France — 3.2% | ||||||||
|
Carmila SA |
13,591 | $ | 105,121 | |||||
|
Covivio |
18,442 | 1,097,738 | ||||||
|
Gecina SA |
19,128 | 2,375,180 | ||||||
|
ICADE |
11,740 | 593,510 | ||||||
|
Klepierre SA |
68,741 | 870,793 | ||||||
|
Mercialys SA |
23,567 | 112,828 | ||||||
|
Unibail-Rodamco-Westfield |
49,804 | 2,024,694 | ||||||
|
|
|
|||||||
| 7,179,864 | ||||||||
| Germany — 13.2% | ||||||||
|
ADLER Group SA(b)(c) |
23,731 | 596,537 | ||||||
|
alstria office REIT-AG |
65,621 | 835,474 | ||||||
|
Aroundtown SA(c) |
441,136 | 2,115,550 | ||||||
|
Deutsche EuroShop AG(a)(c) |
18,438 | 232,816 | ||||||
|
Deutsche Wohnen SE |
127,870 | 6,453,973 | ||||||
|
Grand City Properties SA |
41,480 | 941,717 | ||||||
|
Hamborner REIT AG |
25,364 | 236,746 | ||||||
|
LEG Immobilien AG |
25,522 | 3,449,192 | ||||||
|
Sirius Real Estate Ltd. |
355,015 | 337,390 | ||||||
|
TAG Immobilien AG |
46,652 | 1,374,867 | ||||||
|
TLG Immobilien AG |
5,153 | 92,198 | ||||||
|
Vonovia SE |
209,115 | 13,353,467 | ||||||
|
|
|
|||||||
| 30,019,927 | ||||||||
| Hong Kong — 12.7% | ||||||||
|
Champion REIT |
737,000 | 356,390 | ||||||
|
CK Asset Holdings Ltd. |
991,000 | 4,587,697 | ||||||
|
Hang Lung Properties Ltd. |
749,000 | 1,817,724 | ||||||
|
Hongkong Land Holdings Ltd. |
428,200 | 1,571,494 | ||||||
|
Hysan Development Co. Ltd. |
225,000 | 715,198 | ||||||
|
Link REIT |
758,300 | 5,774,143 | ||||||
|
New World Development Co. Ltd. |
526,333 | 2,504,457 | ||||||
|
Sino Land Co. Ltd.(a) |
1,220,800 | 1,442,004 | ||||||
|
Sun Hung Kai Properties Ltd. |
524,000 | 6,699,627 | ||||||
|
Swire Properties Ltd. |
389,400 | 1,041,935 | ||||||
|
Wharf Real Estate Investment Co. Ltd. |
602,900 | 2,312,911 | ||||||
|
|
|
|||||||
| 28,823,580 | ||||||||
| Ireland — 0.3% | ||||||||
|
Hibernia REIT PLC |
253,776 | 306,253 | ||||||
|
Irish Residential Properties REIT PLC |
163,787 | 261,378 | ||||||
|
|
|
|||||||
| 567,631 | ||||||||
| Israel — 0.4% | ||||||||
|
Amot Investments Ltd. |
50,129 | 231,030 | ||||||
|
Azrieli Group Ltd. |
13,675 | 645,895 | ||||||
|
|
|
|||||||
| 876,925 | ||||||||
| Italy — 0.0% | ||||||||
|
Immobiliare Grande Distribuzione SIIQ SpA |
25,181 | 73,183 | ||||||
|
|
|
|||||||
| Japan — 25.4% | ||||||||
|
Activia Properties Inc. |
253 | 912,388 | ||||||
|
Advance Residence Investment Corp. |
476 | 1,388,751 | ||||||
|
Aeon Mall Co. Ltd. |
44,000 | 683,949 | ||||||
|
AEON REIT Investment Corp. |
580 | 654,678 | ||||||
|
Comforia Residential REIT Inc. |
223 | 637,387 | ||||||
|
Daiwa House REIT Investment Corp. |
743 | 1,719,262 | ||||||
|
Daiwa Office Investment Corp. |
100 | 542,376 | ||||||
|
Daiwa Securities Living Investments Corp. |
691 | 674,872 | ||||||
|
Frontier Real Estate Investment Corp. |
170 | 568,347 | ||||||
|
Fukuoka REIT Corp. |
267 | 322,576 | ||||||
|
Global One Real Estate Investment Corp. |
353 | 318,085 | ||||||
|
GLP J-REIT |
1,389 | 2,139,172 | ||||||
| 20 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Developed Real Estate ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| Japan (continued) | ||||||||
|
Hulic Co. Ltd. |
134,100 | $ | 1,239,149 | |||||
|
Hulic Reit Inc. |
416 | 545,965 | ||||||
|
Ichigo Office REIT Investment Corp. |
440 | 284,102 | ||||||
|
Industrial & Infrastructure Fund Investment Corp. |
698 | 1,185,812 | ||||||
|
Invesco Office J-Reit Inc. |
3,234 | 400,306 | ||||||
|
Invincible Investment Corp. |
1,795 | 570,918 | ||||||
|
Japan Excellent Inc. |
461 | 507,126 | ||||||
|
Japan Hotel REIT Investment Corp. |
1,650 | 793,907 | ||||||
|
Japan Logistics Fund Inc. |
316 | 885,973 | ||||||
|
Japan Prime Realty Investment Corp. |
324 | 875,550 | ||||||
|
Japan Real Estate Investment Corp. |
480 | 2,350,870 | ||||||
|
Japan Retail Fund Investment Corp. |
966 | 1,388,844 | ||||||
|
Kenedix Office Investment Corp. |
140 | 808,877 | ||||||
|
Kenedix Residential Next Investment Corp. |
349 | 569,871 | ||||||
|
Kenedix Retail REIT Corp. |
196 | 373,476 | ||||||
|
LaSalle Logiport REIT |
601 | 934,787 | ||||||
|
MCUBS MidCity Investment Corp. |
615 | 440,042 | ||||||
|
Mitsubishi Estate Co. Ltd. |
420,000 | 6,243,352 | ||||||
|
Mitsubishi Estate Logistics REIT Investment Corp. |
108 | 429,768 | ||||||
|
Mitsui Fudosan Co. Ltd. |
341,800 | 5,801,837 | ||||||
|
Mitsui Fudosan Logistics Park Inc. |
152 | 725,540 | ||||||
|
Mori Hills REIT Investment Corp. |
564 | 693,266 | ||||||
|
Mori Trust Sogo REIT Inc. |
367 | 437,423 | ||||||
|
Nippon Accommodations Fund Inc. |
164 | 938,129 | ||||||
|
Nippon Building Fund Inc. |
543 | 2,742,529 | ||||||
|
Nippon Prologis REIT Inc. |
786 | 2,586,417 | ||||||
|
Nippon REIT Investment Corp. |
161 | 515,157 | ||||||
|
Nomura Real Estate Holdings Inc. |
41,200 | 717,670 | ||||||
|
Nomura Real Estate Master Fund Inc. |
1,659 | 1,977,343 | ||||||
|
Orix JREIT Inc. |
972 | 1,362,139 | ||||||
|
Premier Investment Corp. |
455 | 499,220 | ||||||
|
Sekisui House Reit Inc. |
1,484 | 1,036,273 | ||||||
|
Sumitomo Realty & Development Co. Ltd. |
145,800 | 3,886,977 | ||||||
|
Tokyo Tatemono Co. Ltd. |
72,600 | 830,587 | ||||||
|
Tokyu REIT Inc. |
327 | 443,549 | ||||||
|
United Urban Investment Corp. |
1,096 | 1,166,872 | ||||||
|
|
|
|||||||
| 57,751,466 | ||||||||
| Malta — 0.0% | ||||||||
|
BGP Holdings PLC(c)(d) |
6,603,392 | 77 | ||||||
|
|
|
|||||||
| Netherlands — 0.3% | ||||||||
|
Eurocommercial Properties NV |
18,098 | 197,322 | ||||||
|
NSI NV |
6,635 | 210,223 | ||||||
|
Vastned Retail NV |
6,198 | 163,888 | ||||||
|
Wereldhave NV(a) |
15,508 | 144,155 | ||||||
|
|
|
|||||||
| 715,588 | ||||||||
| New Zealand — 0.7% | ||||||||
|
Goodman Property Trust |
398,871 | 653,762 | ||||||
|
Kiwi Property Group Ltd. |
586,240 | 476,559 | ||||||
|
Precinct Properties New Zealand Ltd. |
394,689 | 461,705 | ||||||
|
|
|
|||||||
| 1,592,026 | ||||||||
| Norway — 0.4% | ||||||||
|
Entra ASA(b) |
61,400 | 800,351 | ||||||
|
|
|
|||||||
| Singapore — 7.4% | ||||||||
|
Ascendas REIT |
1,083,890 | 2,286,051 | ||||||
|
Ascott Residence Trust(a) |
664,800 | 404,089 | ||||||
|
CapitaLand Ltd. |
924,800 | 1,740,561 | ||||||
|
CapitaLand Mall Trust |
1,611,288 | 2,041,397 | ||||||
|
CDL Hospitality Trusts(a) |
289,600 | 209,963 | ||||||
| Security | Shares | Value | ||||||
| Singapore (continued) | ||||||||
|
City Developments Ltd. |
173,000 | $ | 803,237 | |||||
|
Fortune REIT |
500,000 | 416,514 | ||||||
|
Frasers Centrepoint Trust |
394,649 | 609,820 | ||||||
|
Frasers Logistics & Commercial Trust |
919,400 | 828,167 | ||||||
|
Keppel DC REIT |
448,071 | 951,597 | ||||||
|
Keppel REIT(a) |
734,000 | 534,844 | ||||||
|
Manulife US Real Estate Investment Trust |
520,500 | 372,158 | ||||||
|
Mapletree Commercial Trust(a) |
808,617 | 1,018,544 | ||||||
|
Mapletree Industrial Trust |
603,900 | 1,344,457 | ||||||
|
Mapletree Logistics Trust |
940,861 | 1,343,595 | ||||||
|
Parkway Life REIT |
136,100 | 403,665 | ||||||
|
Suntec REIT |
758,100 | 743,943 | ||||||
|
UOL Group Ltd.(a) |
181,900 | 828,574 | ||||||
|
|
|
|||||||
| 16,881,176 | ||||||||
| Spain — 0.8% | ||||||||
|
Inmobiliaria Colonial Socimi SA |
120,002 | 853,383 | ||||||
|
Lar Espana Real Estate Socimi SA |
22,531 | 80,311 | ||||||
|
Merlin Properties Socimi SA |
122,485 | 823,957 | ||||||
|
|
|
|||||||
| 1,757,651 | ||||||||
| Sweden — 4.7% | ||||||||
|
Atrium Ljungberg AB, Class B |
17,041 | 275,301 | ||||||
|
Castellum AB |
99,561 | 2,073,733 | ||||||
|
Catena AB |
9,214 | 375,241 | ||||||
|
Dios Fastigheter AB |
30,670 | 214,835 | ||||||
|
Fabege AB |
97,453 | 1,231,143 | ||||||
|
Fastighets AB Balder, Class B(c) |
35,810 | 1,687,278 | ||||||
|
Hufvudstaden AB, Class A |
40,909 | 534,506 | ||||||
|
Klovern AB, Class B |
189,883 | 289,481 | ||||||
|
Kungsleden AB |
69,264 | 588,279 | ||||||
|
Nyfosa AB(c) |
65,582 | 543,008 | ||||||
|
Pandox AB(c) |
32,216 | 322,480 | ||||||
|
Samhallsbyggnadsbolaget i Norden AB |
347,232 | 957,300 | ||||||
|
Wallenstam AB, Class B |
59,593 | 790,677 | ||||||
|
Wihlborgs Fastigheter AB |
48,985 | 883,817 | ||||||
|
|
|
|||||||
| 10,767,079 | ||||||||
| Switzerland — 2.8% | ||||||||
|
Allreal Holding AG, Registered |
5,185 | 1,098,606 | ||||||
|
Hiag Immobilien Holding AG(c) |
1,063 | 107,860 | ||||||
|
Intershop Holding AG |
417 | 255,691 | ||||||
|
Mobimo Holding AG, Registered |
2,372 | 685,811 | ||||||
|
PSP Swiss Property AG, Registered |
15,895 | 1,923,251 | ||||||
|
Swiss Prime Site AG, Registered |
27,747 | 2,334,072 | ||||||
|
|
|
|||||||
| 6,405,291 | ||||||||
| United Kingdom — 10.2% | ||||||||
|
Aberdeen Standard European Logistics Income PLC(b) |
83,247 | 113,020 | ||||||
|
Assura PLC |
965,283 | 951,061 | ||||||
|
Big Yellow Group PLC |
59,381 | 844,576 | ||||||
|
BMO Commercial Property Trust |
187,551 | 149,140 | ||||||
|
BMO Real Estate Investments Ltd. |
95,238 | 68,467 | ||||||
|
British Land Co. PLC (The) |
341,670 | 1,540,043 | ||||||
|
Capital & Counties Properties PLC |
273,860 | 370,390 | ||||||
|
Civitas Social Housing PLC |
231,352 | 311,104 | ||||||
|
CLS Holdings PLC |
58,083 | 148,851 | ||||||
|
Custodian REIT PLC |
147,577 | 162,767 | ||||||
|
Derwent London PLC |
37,158 | 1,277,044 | ||||||
|
Empiric Student Property PLC |
214,118 | 149,502 | ||||||
|
GCP Student Living PLC |
168,402 | 243,873 | ||||||
|
Grainger PLC |
244,329 | 883,305 | ||||||
|
Great Portland Estates PLC |
93,024 | 694,016 | ||||||
|
S C H E D U L E O F I N V E S T M E N T S |
21 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Developed Real Estate ETF (Percentages shown are based on Net Assets) |
| Security | Shares | Value | ||||||
| United Kingdom (continued) | ||||||||
|
Hammerson PLC(a)(c) |
1,440,375 | $ | 303,665 | |||||
|
Helical PLC |
36,183 | 159,068 | ||||||
|
Impact Healthcare REIT PLC |
90,885 | 116,339 | ||||||
|
Intu Properties PLC(a)(d) |
6,694 | 0 | (e) | |||||
|
Land Securities Group PLC |
263,305 | 1,733,930 | ||||||
|
LondonMetric Property PLC |
324,458 | 905,333 | ||||||
|
LXI REIT PLC |
188,159 | 266,159 | ||||||
|
NewRiver REIT PLC(a) |
115,117 | 94,517 | ||||||
|
Phoenix Spree Deutschland Ltd. |
31,802 | 128,294 | ||||||
|
Picton Property Income Ltd. (The) |
198,798 | 160,140 | ||||||
|
Primary Health Properties PLC |
483,187 | 899,656 | ||||||
|
RDI REIT PLC |
99,375 | 114,101 | ||||||
|
Regional REIT Ltd.(b) |
128,762 | 103,889 | ||||||
|
Safestore Holdings PLC |
75,604 | 785,469 | ||||||
|
Schroder REIT Ltd. |
204,040 | 81,258 | ||||||
|
Segro PLC |
438,464 | 5,113,746 | ||||||
|
Shaftesbury PLC |
81,329 | 478,471 | ||||||
|
Shaftesbury PLC, New |
9,815 | 6,980 | ||||||
|
Standard Life Investment Property Income Trust Ltd. |
151,629 | 103,910 | ||||||
|
Target Healthcare REIT PLC |
169,093 | 233,942 | ||||||
|
Triple Point Social Housing REIT PLC(b) |
115,771 | 157,925 | ||||||
|
Tritax Big Box REIT PLC |
630,529 | 1,276,719 | ||||||
|
Tritax EuroBox PLC(b) |
153,301 | 176,414 | ||||||
|
UK Commercial Property REIT Ltd. |
273,992 | 241,613 | ||||||
|
UNITE Group PLC (The)(c) |
117,314 | 1,263,553 | ||||||
|
Workspace Group PLC |
49,583 | 395,564 | ||||||
|
|
|
|||||||
| 23,207,814 | ||||||||
|
|
|
|||||||
|
Total Common Stocks — 99.4%
|
|
225,814,772 | ||||||
|
|
|
|||||||
|
Rights |
|
|||||||
| Singapore — 0.0% | ||||||||
|
Mapletree Logistics Trust
|
17,876 | 0 | (e) | |||||
|
|
|
|||||||
|
Total Rights — 0.0%
|
|
0 | (e) | |||||
|
|
|
|||||||
| Security | Shares | Value | ||||||
|
Short-Term Investments |
|
|||||||
| Money Market Funds — 2.1% | ||||||||
|
BlackRock Cash Funds: Institutional,
|
4,679,322 | $ | 4,682,597 | |||||
|
BlackRock Cash Funds: Treasury,
|
110,000 | 110,000 | ||||||
|
|
|
|||||||
| 4,792,597 | ||||||||
|
|
|
|||||||
|
Total Short-Term Investments — 2.1%
|
|
4,792,597 | ||||||
|
|
|
|||||||
|
Total Investments in Securities — 101.5%
|
|
230,607,369 | ||||||
|
Other Assets, Less Liabilities — (1.5)% |
|
(3,297,358 | ) | |||||
|
|
|
|||||||
|
Net Assets — 100.0% |
$ | 227,310,011 | ||||||
|
|
|
|||||||
| (a) |
All or a portion of this security is on loan. |
| (b) |
Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) |
Non-income producing security. |
| (d) |
Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
| (e) |
Rounds to less than $1. |
| (f) |
Affiliate of the Fund. |
| (g) |
Annualized 7-day yield as of period-end. |
| (h) |
All or a portion of this security was purchased with cash collateral received from loaned securities. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2020 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
| Affiliated Issuer |
Value at
04/30/20 |
Purchases
at Cost |
Proceeds
from Sales |
Net Realized
Gain (Loss) |
Change in
Unrealized Appreciation (Depreciation) |
Value at
10/31/20 |
Shares
Held at 10/31/20 |
Income |
Capital
Gain
|
|||||||||||||||||||||||||||
|
BlackRock Cash Funds: Institutional, SL Agency Shares |
$ | 411,987 | $ | 4,275,027 | (a) | $ | — | $ | (2,752 | ) | $ | (1,665 | ) | $ | 4,682,597 | 4,679,322 | $ | 124,138 | (b) | $ | — | |||||||||||||||
|
BlackRock Cash Funds: Treasury, SL Agency Shares |
90,000 | 20,000 | (a) | — | — | — | 110,000 | 110,000 | 98 | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| $ | (2,752 | ) | $ | (1,665 | ) | $ | 4,792,597 | $ | 124,236 | $ | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
| (a) |
Represents net amount purchased (sold). |
| (b) |
All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities. |
| 22 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Developed Real Estate ETF |
Futures Contracts
| Description |
Number of
Contracts |
Expiration
Date |
Notional
Amount (000) |
Value/
Unrealized Appreciation (Depreciation) |
||||||||||||
|
Long Contracts |
||||||||||||||||
|
Dow Jones U.S. Real Estate Index |
24 | 12/18/20 | $ | 728 | $ | (44,291 | ) | |||||||||
|
Euro STOXX 50 Index |
6 | 12/18/20 | 207 | (10,134 | ) | |||||||||||
|
Hang Seng Index |
1 | 11/27/20 | 155 | (3,652 | ) | |||||||||||
|
TOPIX Index |
2 | 12/10/20 | 301 | (3,757 | ) | |||||||||||
|
|
|
|||||||||||||||
| (61,834) | ||||||||||||||||
|
|
|
|||||||||||||||
Derivative Financial Instruments Categorized by Risk Exposure
As of October 31, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:
|
Equity
Contracts |
||||
|
Liabilities — Derivative Financial Instruments |
||||
|
Futures contracts |
||||
|
Unrealized depreciation on futures contracts(a) |
$ | 61,834 | ||
|
|
|
|||
| (a) |
Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss). |
For the six months ended October 31, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
Equity
Contracts |
||||
|
Net Realized Gain (Loss) from: |
||||
|
Futures contracts |
$ | 271,835 | ||
|
|
|
|||
|
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
|
Futures contracts |
$ | (182,526 | ) | |
|
|
|
|||
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
Futures contracts: |
||||
|
Average notional value of contracts — long |
$ | 1,932,942 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Measurements
Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.
The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of October 31, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
Investments |
||||||||||||||||
|
Assets |
||||||||||||||||
|
Common Stocks |
$ | 225,807,715 | $ | 6,980 | $ | 77 | $ | 225,814,772 | ||||||||
|
Rights |
— | 0 | (a) | — | 0 | (a) | ||||||||||
|
Money Market Funds |
4,792,597 | — | — | 4,792,597 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 230,600,312 | $ | 6,980 | $ | 77 | $ | 230,607,369 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Derivative financial instruments(b) |
||||||||||||||||
|
Liabilities |
||||||||||||||||
|
Futures Contracts |
$ | (61,834 | ) | $ | — | $ | — | $ | (61,834 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
S C H E D U L E O F I N V E S T M E N T S |
23 |
|
Schedule of Investments (unaudited) (continued) October 31, 2020 |
iShares® International Developed Real Estate ETF |
| (a) |
Rounds to less than $1. |
| (b) |
Shown at the unrealized appreciation (depreciation) on the contracts. |
See notes to financial statements.
| 24 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Assets and Liabilities (unaudited)
October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
25 |
Statements of Assets and Liabilities (unaudited) (continued)
October 31, 2020
See notes to financial statements.
| 26 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Operations (unaudited)
Six Months Ended October 31, 2020
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
27 |
Statements of Operations (unaudited) (continued)
Six Months Ended October 31, 2020
See notes to financial statements.
| 28 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Statements of Changes in Net Assets
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
|
F I N A N C I A L S T A T E M E N T S |
29 |
Statements of Changes in Net Assets (continued)
| (a) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
| 30 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
(For a share outstanding throughout each period)
| iShares Cohen & Steers REIT ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 99.35 | $ | 111.02 | $ | 93.99 | $ | 99.68 | $ | 100.01 | $ | 95.12 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
1.25 | 2.77 | 2.55 | 2.60 | 2.42 | 2.23 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
(0.73 | ) | (11.56 | ) | 17.50 | (5.17 | ) | 1.15 | 6.33 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
0.52 | (8.79 | ) | 20.05 | (2.57 | ) | 3.57 | 8.56 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(1.21 | ) | (2.88 | ) | (3.02 | ) | (3.12 | ) | (3.90 | ) | (3.67 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(1.21 | ) | (2.88 | ) | (3.02 | ) | (3.12 | ) | (3.90 | ) | (3.67 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 98.66 | $ | 99.35 | $ | 111.02 | $ | 93.99 | $ | 99.68 | $ | 100.01 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
0.51 | %(d) | (8.10 | )% | 21.70 | % | (2.68 | )% | 3.58 | % | 9.22 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.33 | %(e) | 0.34 | % | 0.34 | % | 0.34 | % | 0.34 | % | 0.35 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
2.42 | %(e) | 2.43 | % | 2.51 | % | 2.63 | % | 2.37 | % | 2.33 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,766,011 | $ | 1,842,861 | $ | 2,187,126 | $ | 2,476,649 | $ | 3,239,748 | $ | 3,680,246 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
10 | %(d) | 19 | % | 17 | % | 12 | % | 8 | % | 14 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
31 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Core U.S. REIT ETF | ||||||||||||||||||||||||
|
Six Months Ended
10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 42.45 | $ | 51.60 | $ | 45.73 | $ | 48.93 | $ | 47.95 | $ | 46.04 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.62 | 1.62 | 1.79 | 1.70 | 1.27 | 1.02 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
0.22 | (8.95 | ) | 6.59 | (3.20 | ) | 1.60 | 2.77 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
0.84 | (7.33 | ) | 8.38 | (1.50 | ) | 2.87 | 3.79 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.67 | ) | (1.80 | ) | (2.44 | ) | (1.70 | ) | (1.89 | ) | (1.88 | ) | ||||||||||||
|
From net realized gain |
— | (0.02 | ) | (0.07 | ) | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.67 | ) | (1.82 | ) | (2.51 | ) | (1.70 | ) | (1.89 | ) | (1.88 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 42.62 | $ | 42.45 | $ | 51.60 | $ | 45.73 | $ | 48.93 | $ | 47.95 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
1.96 | %(d) | (14.60 | )% | 18.82 | % | (3.18 | )% | 6.02 | % | 8.48 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.08 | %(e) | 0.08 | % | 0.08 | % | 0.08 | % | 0.28 | % | 0.48 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
2.80 | %(e) | 3.12 | % | 3.64 | % | 3.60 | % | 2.57 | % | 2.22 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 1,378,793 | $ | 1,339,443 | $ | 1,290,051 | $ | 514,475 | $ | 124,765 | $ | 74,323 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
3 | %(d) | 8 | % | 11 | % | 8 | % | 30 | % | 11 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 32 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares Global REIT ETF | ||||||||||||||||||||||||
|
Six Months Ended 10/31/20 (unaudited) |
Year Ended
04/30/20 |
Year Ended
04/30/19 |
Year Ended
04/30/18 |
Year Ended
04/30/17 |
Year Ended
04/30/16 |
|||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net asset value, beginning of period |
$ | 20.42 | $ | 26.53 | $ | 24.82 | $ | 25.42 | $ | 26.35 | $ | 25.81 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.33 | 0.88 | 0.98 | 0.97 | 0.86 | 0.87 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
(0.04 | ) | (5.54 | ) | 2.08 | (0.56 | ) | (0.47 | ) | 0.64 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
0.29 | (4.66 | ) | 3.06 | 0.41 | 0.39 | 1.51 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.37 | ) | (1.45 | ) | (1.35 | ) | (0.99 | ) | (1.29 | ) | (0.97 | ) | ||||||||||||
|
From net realized gain |
— | — | — | (0.02 | ) | (0.03 | ) | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.37 | ) | (1.45 | ) | (1.35 | ) | (1.01 | ) | (1.32 | ) | (0.97 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 20.34 | $ | 20.42 | $ | 26.53 | $ | 24.82 | $ | 25.42 | $ | 26.35 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
1.39 | %(d) | (18.47 | )% | 12.77 | % | 1.61 | % | 1.53 | % | 6.17 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.14 | %(e) | 0.14 | % | 0.14 | % | 0.14 | % | 0.14 | % | 0.14 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
3.13 | %(e) | 3.36 | % | 3.85 | % | 3.83 | % | 3.31 | % | 3.47 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 2,019,913 | $ | 1,900,334 | $ | 1,637,157 | $ | 913,379 | $ | 350,819 | $ | 144,910 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(f) |
4 | %(d) | 8 | % | 9 | % | 7 | % | 5 | % | 9 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Annualized. |
| (f) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
|
F I N A N C I A L H I G H L I G H T S |
33 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
| iShares International Developed Real Estate ETF | ||||||||||||||||||||||||
|
Six Months
Ended 10/31/20 (unaudited) |
Year
Ended 04/30/20 |
Year
Ended 04/30/19 |
Year
Ended 04/30/18 |
Year
Ended 04/30/17 |
Year
Ended 04/30/16 |
|||||||||||||||||||
|
Net asset value, beginning of period |
$ | 22.75 | $ | 29.65 | $ | 30.40 | $ | 28.11 | $ | 30.06 | $ | 32.17 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income(a) |
0.38 | 0.86 | 0.93 | 0.91 | 0.82 | 0.75 | ||||||||||||||||||
|
Net realized and unrealized gain (loss)(b) |
0.20 | (5.47 | ) | (0.55 | ) | 2.86 | (0.76 | ) | (1.79 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net increase (decrease) from investment operations |
0.58 | (4.61 | ) | 0.38 | 3.77 | 0.06 | (1.04 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Distributions(c) |
||||||||||||||||||||||||
|
From net investment income |
(0.37 | ) | (2.29 | ) | (1.13 | ) | (1.48 | ) | (2.01 | ) | (1.07 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total distributions |
(0.37 | ) | (2.29 | ) | (1.13 | ) | (1.48 | ) | (2.01 | ) | (1.07 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net asset value, end of period |
$ | 22.96 | $ | 22.75 | $ | 29.65 | $ | 30.40 | $ | 28.11 | $ | 30.06 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total Return |
||||||||||||||||||||||||
|
Based on net asset value |
2.52 | %(d) | (16.93 | )% | 1.39 | % | 13.69 | % | 0.63 | %(e) | (3.11 | )% | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Ratios to Average Net Assets |
||||||||||||||||||||||||
|
Total expenses |
0.48 | %(f) | 0.48 | % | 0.48 | % | 0.48 | % | 0.48 | % | 0.48 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Total expenses excluding professional fees for foreign withholding tax claims |
N/A | N/A | 0.48 | % | N/A | 0.48 | % | N/A | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net investment income |
3.15 | %(f) | 2.99 | % | 3.20 | % | 3.08 | % | 2.85 | %(e) | 2.56 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Supplemental Data |
||||||||||||||||||||||||
|
Net assets, end of period (000) |
$ | 227,310 | $ | 259,384 | $ | 477,332 | $ | 535,093 | $ | 519,971 | $ | 700,478 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Portfolio turnover rate(g) |
7 | %(d) | 10 | % | 8 | % | 8 | % | 7 | % | 12 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) |
Based on average shares outstanding. |
| (b) |
The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities. |
| (c) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
| (d) |
Not annualized. |
| (e) |
Reflects the one-time, positive effect of foreign withholding tax claims, net of the associated professional fees, which resulted in the following increases: |
| • |
Total return by 0.04%. |
| • |
Ratio of net investment income to average net assets by 0.01%. |
| (f) |
Annualized. |
| (g) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
| 34 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
| Notes to Financial Statements (unaudited) |
| 1. |
ORGANIZATION |
iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.
These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):
| iShares ETF |
Diversification
Classification |
|
|
Cohen & Steers REIT |
Non-diversified | |
|
Core U.S. REIT |
Diversified | |
|
Global REIT |
Diversified | |
|
International Developed Real Estate |
Diversified |
| 2. |
SIGNIFICANT ACCOUNTING POLICIES |
The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:
Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when the Funds are informed of the ex-dividend date. Under the applicable foreign tax laws, a withholding tax at various rates may be imposed on capital gains, dividends and interest. Any taxes withheld that are reclaimable from foreign tax authorities are reflected in tax reclaims receivable. Upon notification from issuers or as estimated by management, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain.
Foreign Currency Translation: Each Fund’s books and records are maintained in U.S. dollars. Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars using prevailing market rates as quoted by one or more data service providers. Purchases and sales of investments are recorded at the rates of exchange prevailing on the respective dates of such transactions. Generally, when the U.S. dollar rises in value against a foreign currency, the investments denominated in that currency will lose value; the opposite effect occurs if the U.S. dollar falls in relative value.
Each Fund does not isolate the effect of fluctuations in foreign exchange rates from the effect of fluctuations in the market prices of investments for financial reporting purposes. Accordingly, the effects of changes in exchange rates on investments are not segregated in the statement of operations from the effects of changes in market prices of those investments, but are included as a component of net realized and unrealized gain (loss) from investments. Each Fund reports realized currency gains (losses) on foreign currency related transactions as components of net realized gain (loss) for financial reporting purposes, whereas such components are generally treated as ordinary income for U.S. federal income tax purposes.
Foreign Taxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its statement of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2020, if any, are disclosed in the statement of assets and liabilities.
Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.
In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.
Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
35 |
Notes to Financial Statements (unaudited) (continued)
Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.
| 3. |
INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS |
Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. A fund determines the fair value of its financial instruments using various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.
Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:
| • |
Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price. |
| • |
Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV. |
| • |
Futures contracts are valued based on that day’s last reported settlement price on the exchange where the contract is traded. |
If events (e.g., a market closure, market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and the cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.
Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.
Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:
| • |
Level 1 — Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access; |
| • |
Level 2 — Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs); and |
| • |
Level 3 — Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments). |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgement exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.
| 4. |
SECURITIES AND OTHER INVESTMENTS |
Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned
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Notes to Financial Statements (unaudited) (continued)
securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.
As of October 31, 2020, any securities on loan were collateralized by cash and/or U.S. government obligations. Cash collateral received was invested in money market funds managed by BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, or its affiliates and is disclosed in the schedules of investments. Any non-cash collateral received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan for each Fund, if any, are also disclosed in its schedule of investments. The market value of any securities on loan as of October 31, 2020 and the value of the related cash collateral are disclosed in the statements of assets and liabilities.
Securities lending transactions are entered into by a fund under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value of the collateral is typically greater than the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the fund can reinvest cash collateral received in connection with loaned securities.
As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA as of October 31, 2020:
| iShares ETF and Counterparty |
Market Value of
Securities on Loan |
Cash Collateral
Received(a) |
Non-Cash Collateral
Received |
Net Amount | ||||||||||||
|
Core U.S. REIT |
||||||||||||||||
|
Barclays Capital Inc. |
$ | 5,234 | $ | 5,234 | $ | — | $ | — | ||||||||
|
Goldman Sachs & Co. |
916,355 | 916,355 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
9,516 | 9,516 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
1,728,581 | 1,728,581 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
2,271 | 2,271 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 2,661,957 | 2,661,957 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Global REIT |
||||||||||||||||
|
BNP Paribas Prime Brokerage International Ltd. |
$ | 7,375 | $ | 7,375 | $ | — | $ | — | ||||||||
|
BofA Securities, Inc. |
2,456,301 | 2,456,301 | — | — | ||||||||||||
|
Citigroup Global Markets Inc. |
40,931 | 40,931 | — | — | ||||||||||||
|
Credit Suisse Securities (USA) LLC |
383,576 | 383,576 | — | — | ||||||||||||
|
Goldman Sachs & Co. |
2,117,931 | 2,117,931 | — | — | ||||||||||||
|
HSBC Bank PLC |
578,032 | 578,032 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
2,837,925 | 2,837,925 | — | — | ||||||||||||
|
National Financial Services LLC |
1,598,200 | 1,598,200 | — | — | ||||||||||||
|
State Street Bank & Trust Company |
780,976 | 780,976 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 10,801,247 | 10,801,247 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
International Developed Real Estate |
||||||||||||||||
|
BofA Securities, Inc. |
$ | 136,369 | $ | 136,369 | $ | — | $ | — | ||||||||
|
Goldman Sachs & Co. |
354,941 | 354,941 | — | — | ||||||||||||
|
HSBC Bank PLC |
207,856 | 207,856 | — | — | ||||||||||||
|
JPMorgan Securities LLC |
18,983 | 18,983 | — | — | ||||||||||||
|
Morgan Stanley & Co. LLC |
1,281,240 | 1,281,240 | — | — | ||||||||||||
|
SG Americas Securities LLC |
1,369,904 | 1,369,904 | — | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 3,369,293 | 3,369,293 | — | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (a) |
Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s statement of assets and liabilities. |
The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
37 |
Notes to Financial Statements (unaudited) (continued)
| 5. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: Each Fund’s use of futures contracts is generally limited to cash equitization. This involves the use of available cash to invest in index futures contracts in order to gain exposure to the equity markets represented in or by the Fund’s underlying index and is intended to allow the Fund to better track its underlying index. Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).
Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the statement of assets and liabilities.
Securities deposited as initial margin are designated in the schedule of investments and cash deposited, if any, are shown as cash pledged for futures contracts in the statement of assets and liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the statement of assets and liabilities. When the contract is closed, a realized gain or loss is recorded in the statement of operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.
| 6. |
INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES |
Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).
For its investment advisory services to the iShares Cohen & Steers REIT ETF, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Fund, based on the Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:
| Aggregate Average Daily Net Assets | Investment Advisory Fee | |||
|
First $121 billion |
0.3500 | % | ||
|
Over $121 billion, up to and including $181 billion |
0.3325 | |||
|
Over $181 billion, up to and including $231 billion |
0.3159 | |||
|
Over $231 billion, up to and including $281 billion |
0.3001 | |||
|
Over $281 billion |
0.2851 | |||
Each reduced investment advisory fee level reflects a 5% reduction (rounded to the fourth decimal place) from the investment advisory fee at the prior aggregate average daily net asset level.
For its investment advisory services to each of the following Funds, BFAis entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on the average daily net assets of each Fund as follows:
| iShares ETF | Investment Advisory Fee | |||
|
Core U.S. REIT |
0.08 | % | ||
|
Global REIT |
0.14 | |||
|
International Developed Real Estate |
0.48 | |||
Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.
Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money
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Notes to Financial Statements (unaudited) (continued)
market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.
Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.
Pursuant to the current securities lending agreement, each of iShares Cohen & Steers REIT ETF and iShares Core U.S. REIT ETF (the “Group 1 Funds”), retains 75% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
Pursuant to the current securities lending agreement, each of iShares Global REIT ETF and iShares International Developed Real Estate ETF (the “Group 2 Funds”), retains 82% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in a given calendar year exceeds a specified threshold: (1) each Group 1 Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 80% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees, and (2) each Group 2 Fund will retain for the remainder of that calendar year 85% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.
The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its statement of operations. For the six months ended October 31, 2020, the Funds paid BTC the following amounts for securities lending agent services:
| iShares ETF |
Fees Paid
to BTC |
|||
|
Cohen & Steers REIT |
$ | 32,069 | ||
|
Core U.S. REIT |
57,973 | |||
|
Global REIT |
116,475 | |||
|
International Developed Real Estate |
28,380 | |||
Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.
Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.
For the six months ended October 31, 2020, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:
| iShares ETF | Purchases | Sales |
Net Realized
Gain (Loss) |
|||||||||
|
Cohen & Steers REIT |
$ | 10,274,434 | $ | 1,526,490 | $ | (577,952 | ) | |||||
|
Core U.S. REIT |
4,353,624 | 4,946,260 | (2,578,138 | ) | ||||||||
|
Global REIT |
2,866,242 | 12,896,911 | (7,067,747) | |||||||||
|
International Developed Real Estate |
1,005,495 | 753,874 | (418,735 | ) | ||||||||
Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends – affiliated in the statement of operations.
A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.
| 7. |
PURCHASES AND SALES |
For the six months ended October 31, 2020, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
| iShares ETF | Purchases | Sales | ||||||
|
Cohen & Steers REIT |
$ | 180,915,885 | $ | 173,956,318 | ||||
|
Core U.S. REIT |
40,997,852 | 34,426,962 | ||||||
|
Global REIT |
102,957,782 | 71,191,688 | ||||||
|
International Developed Real Estate |
16,483,019 | 17,466,267 | ||||||
|
N O T E S T O F I N A N C I A L S T A T E M E N T S |
39 |
Notes to Financial Statements (unaudited) (continued)
For the six months ended October 31, 2020, purchases and sales related to in-kind transactions were as follows:
| iShares ETF |
In-kind
Purchases |
In-kind
Sales |
||||||
|
Cohen & Steers REIT |
$ | 62,225,987 | $ | 125,523,023 | ||||
|
Core U.S. REIT |
203,161,503 | 162,845,260 | ||||||
|
Global REIT |
213,523,835 | 113,515,198 | ||||||
|
International Developed Real Estate |
13,292,890 | 47,643,152 | ||||||
| 8. |
INCOME TAX INFORMATION |
Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.
Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2020, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.
As of April 30, 2020, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
| iShares ETF | Non-Expiring | |||
|
Cohen & Steers REIT |
$ | 74,530,498 | ||
|
Global REIT |
10,949,984 | |||
|
International Developed Real Estate |
66,975,112 | |||
A fund may own shares in certain foreign investment entities, referred to, under U.S. tax law, as “passive foreign investment companies.” Such fund may elect to mark-to-market annually the shares of each passive foreign investment company and would be required to distribute to shareholders any such marked-to-market gains.
As of October 31, 2020, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:
| iShares ETF | Tax Cost |
Gross Unrealized
Appreciation |
Gross Unrealized
Depreciation |
Net Unrealized
Appreciation (Depreciation) |
||||||||||||
|
Cohen & Steers REIT |
$ | 1,862,446,816 | $ | 285,767,512 | $ | (382,853,850 | ) | $ | (97,086,338 | ) | ||||||
|
Core U.S. REIT |
1,648,081,927 | 110,840,695 | (378,405,652 | ) | (267,564,957 | ) | ||||||||||
|
Global REIT |
2,451,862,965 | 132,807,823 | (561,238,106 | ) | (428,430,283 | ) | ||||||||||
|
International Developed Real Estate |
295,787,573 | 21,905,966 | (87,148,004 | ) | (65,242,038 | ) | ||||||||||
| 9. |
PRINCIPAL RISKS |
In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.
BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.
The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.
Market Risk: An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.
| 40 |
2 0 2 0 I S H A R E S S E M I - A N N U A L R E P O R T T O S H A R E H O L D E R S |
Notes to Financial Statements (unaudited) (continued)
Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A fund may invest in illiquid investments. An illiquid investment is any investment that a fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A fund may experience difficulty in selling illiquid investments in a timely manner at the price that it believes the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause a fund’s NAV to experience significant increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a fund may lose value, regardless of the individual results of the securities and other instruments in which a fund invests.
The price each Fund could receive upon the sale of any particular portfolio investment may differ from each Fund’s valuation of the investment, particularly for securities that trade in thin or volatile markets or that are valued using a fair valuation technique or a price provided by an independent pricing service. Changes to significant unobservable inputs and assumptions (i.e., publicly traded company multiples, growth rate, time to exit) due to the lack of observable inputs.
Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the statement of assets and liabilities, less any collateral held by the Funds.
A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.
With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.
Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.
Certain Funds invest a significant portion of their assets in issuers located in a single country or a limited number of countries. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions in that country or those countries may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Foreign issuers may not be subject to the same uniform accounting, auditing and financial reporting standards and practices as used in the United States. Foreign securities markets may also be more volatile and less liquid than U.S. securities and may be less subject to governmental supervision not typically associated with investing in U.S. securities. Investment percentages in specific countries are presented in the schedule of investments.
Certain Funds invest a significant portion of their assets in securities of issuers located in Europe or with significant exposure to European issuers or countries. The European financial markets have recently experienced volatility and adverse trends due to concerns about economic downturns in, or rising government debt levels of, several European countries. These events may spread to other countries in Europe and may affect the value and liquidity of certain of the Funds’ investments.
Responses to the financial problems by European governments, central banks and others, including austerity measures and reforms, may not work, may result in social unrest and may limit future growth and economic recovery or have other unintended consequences. Further defaults or restructurings by governments and others of their debt could have additional adverse effects on economies, financial markets and asset valuations around the world. In addition, the United Kingdom has withdrawn from the European Union, and one or more other countries may withdraw from the European Union and/or abandon the Euro, the common currency of the European Union. The impact of these actions, especially if they occur in a disorderly fashion, is not clear but could be significant and far reaching.
Certain Funds invest a significant portion of their assets in securities of issuers located in Asia or with significant exposure to Asian issuers or countries. The Asian financial markets have recently experienced volatility and adverse trends due to concerns in several Asian countries regarding monetary policy, government intervention in the markets, rising government debt levels or economic downturns. These events may spread to other countries in Asia and may affect the value and liquidity of certain of the Funds’ investments.
Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific sectors are presented in the schedule of investments.
LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021, and it is expected that LIBOR will cease to be published after that time. The Funds may be exposed to financial instruments tied to LIBOR to determine payment obligations,
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N O T E S T O F I N A N C I A L S T A T E M E N T S |
41 |
Notes to Financial Statements (unaudited) (continued)
financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Funds is uncertain.
| 10. |
CAPITAL SHARE TRANSACTIONS |
Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.
Transactions in capital shares were as follows:
|
|
||||||||||||||||
|
Six Months Ended
10/31/20 |
Year Ended
04/30/20 |
|||||||||||||||
| iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
|
Cohen & Steers REIT |
||||||||||||||||
|
Shares sold |
600,000 | $ | 62,438,070 | 2,050,000 | $ | 241,031,203 | ||||||||||
|
Shares redeemed |
(1,250,000 | ) | (125,876,394 | ) | (3,200,000 | ) | (338,936,004 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(650,000 | ) | (63,438,324 | ) | (1,150,000 | ) | (97,904,801 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Core U.S. REIT |
||||||||||||||||
|
Shares sold |
4,750,000 | 204,398,767 | 15,600,000 | 781,521,024 | ||||||||||||
|
Shares redeemed |
(3,950,000 | ) | (163,698,115 | ) | (9,050,000 | ) | (419,158,586 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
800,000 | 40,700,652 | 6,550,000 | 362,362,438 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Global REIT |
||||||||||||||||
|
Shares sold |
11,900,000 | 251,029,969 | 37,850,000 | 946,728,517 | ||||||||||||
|
Shares redeemed |
(5,650,000 | ) | (120,109,702 | ) | (6,500,000 | ) | (167,002,706 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net increase |
6,250,000 | 130,920,267 | 31,350,000 | 779,725,811 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
International Developed Real Estate |
||||||||||||||||
|
Shares sold |
600,000 | 13,805,489 | 400,000 | 12,029,743 | ||||||||||||
|
Shares redeemed |
(2,100,000 | ) | (49,617,530 | ) | (5,100,000 | ) | (144,398,770 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net decrease |
(1,500,000 | ) | (35,812,041 | ) | (4,700,000 | ) | (132,369,027 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.
From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the statement of assets and liabilities.
| 11. |
FOREIGN WITHHOLDING TAX CLAIMS |
The Internal Revenue Service (“IRS”) has issued guidance to address U.S. income tax liabilities attributable to fund shareholders resulting from the recovery of foreign taxes withheld in prior calendar years. These withheld foreign taxes were passed through to shareholders in the form of foreign tax credits in the year the taxes were withheld. Assuming there are sufficient foreign taxes paid which the iShares International Developed Real Estate ETF is able to pass through to shareholders as a foreign tax credit in the current year, the Fund will be able to offset the prior years’ withholding taxes recovered against the foreign taxes paid in the current year. Accordingly, no federal income tax liability is recorded by the Fund.
| 12. |
LEGAL PROCEEDINGS |
On June 16, 2016, investors in certain iShares funds (iShares Core S&P Small-Cap ETF, iShares Russell 1000 Growth ETF, iShares Core S&P 500 ETF, iShares Russell Mid-Cap Growth ETF, iShares Russell Mid-Cap ETF, iShares Russell Mid-Cap Value ETF, iShares Select Dividend ETF, iShares Morningstar Mid-Cap ETF, iShares Morningstar Large-Cap ETF, iShares U.S. Aerospace & Defense ETF and iShares Preferred and Income Securities ETF) filed a class action lawsuit against iShares Trust, BlackRock, Inc. and certain of its advisory affiliates, and certain directors/trustees and officers of the Funds (collectively, “Defendants”) in California State Court. The lawsuit alleges the Defendants violated federal securities laws by failing to adequately disclose in the prospectuses issued by the funds noted above the risks of using stop-loss orders in the event of a ‘flash crash’, such as the one that occurred on May 6, 2010. On September 18, 2017, the court issued a Statement of Decision holding that the Plaintiffs lack standing to assert their claims. On October 11, 2017, the court entered final judgment dismissing all of the Plaintiffs’ claims with prejudice. In an opinion dated
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Notes to Financial Statements (unaudited) (continued)
January 23, 2020, the California Court of Appeal affirmed the dismissal of Plaintiffs’ claims. On March 3, 2020, plaintiffs filed a petition for review by the California Supreme Court. On May 27, 2020, the California Supreme Court denied Plaintiff’s petition for review. The case is now closed.
| 13. |
SUBSEQUENT EVENTS |
Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were available to be issued and the following items were noted:
On September 17, 2020, the Board approved a two-for-one stock split for the iShares Cohen & Steers REIT ETF, effective after the close of trading on December 4, 2020. The impact of the stock split will be to increase the number of shares outstanding by a factor of two, while decreasing the NAV per share by a factor of two, resulting in no effect on the net assets of the Fund.
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N O T E S T O F I N A N C I A L S T A T E M E N T S |
43 |
Board Review and Approval of Investment Advisory Contract
iShares Cohen & Steers REIT ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares
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Board Review and Approval of Investment Advisory Contract (continued)
funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board further noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares Core U.S. REIT ETF, iShares Global REIT ETF (each the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers;
|
B O A R D R E V I E W A N D A P P R O V A L O F I N V E S T M E N T A D V I S O R Y C O N T R A C T |
45 |
Board Review and Approval of Investment Advisory Contract (continued)
risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue,
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Board Review and Approval of Investment Advisory Contract (continued)
including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
iShares International Developed Real Estate ETF (the “Fund”)
Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. At meetings on April 17, 2020 and May 19, 2020, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with
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Board Review and Approval of Investment Advisory Contract (continued)
independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 8-10, 2020, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.
After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Contract are discussed below.
Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of another fund in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs (including, where applicable, funds sponsored by an “at cost” service provider), objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that overall fund expenses (net of waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of waivers and reimbursements ) of the funds in its Peer Group, excluding iShares funds.
In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2019, to that of relevant comparison fund(s) for the same periods.
The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.
Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided at the June 8-10, 2020 meeting and throughout the year.
Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).
Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors and other information considered.
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Board Review and Approval of Investment Advisory Contract (continued)
Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability, including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Contract for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board would continue to assess the appropriateness of adding breakpoints in the future.
The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Contract for the coming year.
Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.
Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, such as payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services and BlackRock’s profile in the investment community. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates (including associated commissions) are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.
Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Contract for the coming year.
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Supplemental Information (unaudited)
Section 19(a) Notices
The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.
October 31, 2020
|
Total Cumulative Distributions
for the Fiscal Year-to-Date |
% Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date |
|||||||||||||||||||||||||||||||
| iShares ETF |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
Net
Investment Income |
Net Realized
Capital Gains |
Return of
Capital |
Total Per
Share |
||||||||||||||||||||||||
|
Core U.S. REIT |
$ | 0.673175 | $ | — | $ | — | $ | 0.673175 | 100 | % | — | % | — | % | 100 | % | ||||||||||||||||
|
Global REIT(a) |
0.344725 | — | 0.027889 | 0.372614 | 93 | — | 7 | 100 | ||||||||||||||||||||||||
|
International Developed Real Estate(a) |
0.353469 | — | 0.019407 | 0.372876 | 95 | — | 5 | 100 | ||||||||||||||||||||||||
| (a) |
The Fund estimates that it has distributed more than its net investment income and net realized capital 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 shareholder’s investment in the Fund is returned 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”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share. |
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Electronic Delivery
Shareholders can sign up for email notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.
To enroll in electronic delivery:
| • |
Go to icsdelivery.com. |
| • |
If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor. |
Householding
Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.
Availability of Quarterly Schedule of Investments
The iShares Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The iShares Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. The iShares Funds also disclose their complete schedule of portfolio holdings on a daily basis on the iShares website at iShares.com.
Availability of Proxy Voting Policies and Proxy Voting Records
A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.
A description of the Company’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.
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Glossary of Terms Used in this Report
Portfolio Abbreviations - Equity
| NVS | Non-Voting Shares | |
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Want to know more?
iShares.com | 1-800-474-2737
This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.
Investing involves risk, including possible loss of principal.
The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Cohen & Steers Capital Management, Inc. or FTSE International Limited, nor do these companies make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the companies listed above.
©2020 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.
iS-SAR-405-1020
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|
|
| Item 2. |
Code of Ethics. |
Not applicable to this semi-annual report.
| Item 3. |
Audit Committee Financial Expert. |
Not applicable to this semi-annual report.
| Item 4. |
Principal Accountant Fees and Services. |
Not applicable to this semi-annual report.
| Item 5. |
Audit Committee of Listed Registrants. |
Not applicable to this semi-annual report.
| Item 6. |
Investments. |
| (a) |
Schedules of investments are included as part of the reports to shareholders filed under Item 1 of this Form. |
| (b) |
Not applicable. |
| Item 7. |
Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Not applicable to the registrant.
| Item 8. |
Portfolio Managers of Closed-End Management Investment Companies. |
Not applicable to the registrant.
| Item 9. |
Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Not applicable to the registrant.
| Item 10. |
Submission of Matters to a Vote of Security Holders. |
There were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s Board of Trustees.
| Item 11. |
Controls and Procedures. |
| (a) |
The President (the registrant’s Principal Executive Officer) and Treasurer and Chief Financial Officer (the registrant’s Principal Financial Officer) have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are effective as of a date within 90 days of the filing date of this report, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the Investment Company Act of 1940 and Rules 13a-15(b) or 15d-15(b) under the Exchange Act of 1934. |
| (b) |
There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during 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. |
Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. |
Not applicable to the registrant.
| Item 13. |
Exhibits. |
(a) (1) Not applicable to this semi-annual report.
(a) (2) Section 302 Certifications are attached.
(a) (3) Not applicable.
(a) (4) Not applicable.
(b) Section 906 Certifications are attached.
SIGNATURES
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.
iShares Trust
| By: |
/s/ Armando Senra |
|||
| Armando Senra, President (Principal Executive Officer) |
Date: January 06, 2021
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/ Armando Senra |
|||
| Armando Senra, President (Principal Executive Officer) |
Date: January 06, 2021
| By: |
/s/ Trent Walker |
|||
| Trent Walker, Treasurer and Chief Financial Officer (Principal Financial Officer) |
Date: January 06, 2021