|
FEBRUARY 28, 2022 |
2022 Semi-Annual Report (Unaudited)
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iShares Trust
· |
iShares MSCI China Multisector Tech ETF | TCHI | NASDAQ |
· |
iShares MSCI Japan Equal Weighted ETF | EWJE | NASDAQ |
· |
iShares MSCI Japan Value ETF | EWJV | NASDAQ |
Dear Shareholder,
The 12-month reporting period as of February 28, 2022 saw a continuation of the resurgent growth that followed the initial coronavirus (or “COVID-19”) pandemic reopening, albeit at a slower pace. The global economy weathered the emergence of several variant strains and the resulting peaks and troughs in infections amid optimism that increasing vaccinations and economic adaptation could help contain the pandemic’s disruptions. However, rapid changes in consumer spending led to supply constraints and elevated inflation. Moreover, while the foremost effect of Russia’s invasion of Ukraine has been a severe humanitarian crisis, the invasion has presented challenges for both investors and policymakers.
Equity prices were mixed, as persistently high inflation drove investors’ expectations for higher interest rates, which particularly weighed on relatively high valuation growth stocks and economically sensitive small-capitalization stocks. Overall, small-capitalization U.S. stocks declined, while large-capitalization U.S. stocks posted a solid advance. International equities from developed markets gained slightly, although emerging market stocks declined, pressured by rising interest rates and a strengthening U.S. dollar.
The 10-year U.S. Treasury yield (which is inversely related to bond prices) rose during the reporting period as the economy expanded rapidly and inflation reached its highest annualized reading in decades. In the corporate bond market, the improving economy assuaged credit concerns and led to modest returns for high-yield corporate bonds, outpacing the negative return of investment-grade corporate bonds.
The U.S. Federal Reserve (the “Fed”) maintained accommodative monetary policy during the reporting period by keeping near-zero interest rates. However, the Fed’s tone shifted during the period, as it reduced its bond-buying program and raised the prospect of higher rates in 2022. Continued high inflation and the Fed’s new stance led many analysts to anticipate that the Fed will raise interest rates multiple times throughout the year.
Looking ahead, however, the horrific war in Ukraine has significantly clouded the outlook for the global economy. Sanctions on Russia and general wartime disruption are likely to drive already-high commodity prices even further upwards, and we have already seen spikes in energy and metal markets. While this will exacerbate inflationary pressure, it could also constrain economic growth, making the Fed’s way forward less clear. Its challenge will be combating inflation without stifling a recovery that is now facing additional supply shocks.
In this environment, we favor an overweight to equities, as we believe low interest rates and continued economic growth will support further gains, albeit likely more modest than what we saw in 2021. Sectors that are better poised to manage the transition to a lower-carbon world, such as technology and health care, are particularly attractive in the long term. U.S. and other developed market equities have room for further growth, while we believe Chinese equities stand to gain from a more accommodative monetary and fiscal environment. We are underweight long-term credit, but inflation-protected U.S. Treasuries, Asian fixed income, and emerging market local-currency bonds offer potential opportunities. 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.
Overall, 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 February 28, 2022
| ||||||
6-Month
|
12-Month
| |||||
U.S. large cap equities (S&P 500® Index) |
(2.62)% | 16.39% | ||||
U.S. small cap equities (Russell 2000® Index) |
(9.46) | (6.01) | ||||
International equities (MSCI Europe, Australasia, Far East Index) |
(6.78) | 2.83 | ||||
Emerging market equities (MSCI Emerging Markets Index) |
(9.81) | (10.69) | ||||
3-month Treasury bills (ICE BofA 3-Month U.S. Treasury Bill Index) |
0.02 | 0.04 | ||||
U.S. Treasury securities (ICE BofA 10-Year U.S. Treasury Index) |
(3.94) | (1.67) | ||||
U.S. investment grade bonds (Bloomberg U.S. Aggregate Bond Index) |
(4.07) | (2.64) | ||||
Tax-exempt municipal bonds (Bloomberg Municipal Bond Index) |
(3.09) | (0.66) | ||||
U.S. high yield bonds (Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index) |
(3.07) | 0.64 | ||||
Past performance is not an indication 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 | ||
7 | ||
7 | ||
8 | ||
Financial Statements |
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20 | ||
21 | ||
22 | ||
24 | ||
27 | ||
33 | ||
35 | ||
36 | ||
37 | ||
38 |
Fund Summary as of February 28, 2022 | iShares® MSCI China Multisector Tech ETF |
Investment Objective
The iShares MSCI China Multisector Tech ETF (the “Fund”) seeks to track the investment results of an index composed of Chinese equities in technology and technology-related industries, as represented by the MSCI China Technology Sub-Industries Select Capped 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
Cumulative Total Returns | ||||
Since Inception |
||||
Fund NAV |
(5.71 | )% | ||
Fund Market |
(5.36 | ) | ||
Index |
(5.52 | ) |
The inception date of the Fund was 1/25/22. The first day of secondary market trading was 1/27/22.
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 7 for more information.
Expense Example
Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
Beginning Account Value (01/25/22) |
(a) |
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Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(b) |
|
Beginning Account Value (09/01/21) |
|
|
Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(b) |
|
Annualized Expense Ratio |
| ||||||||||
$ 1,000.00 | $ 942.90 | $ 0.53 | $ 1,000.00 | $ 1,021.90 | $ 2.96 | 0.59 | % |
(a) |
Commencement of operations. |
(b) |
Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 34/365 for actual expenses and 181/365 for hypothetical expenses (to reflect the six month period shown). 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” for more information. |
Portfolio Information
ALLOCATION BY SECTOR
Sector |
Percent of Total Investments(a) |
|||
Information Technology |
44.1% | |||
Consumer Discretionary |
22.4 | |||
Communication Services |
20.9 | |||
Industrials |
9.7 | |||
Financials |
2.8 | |||
Health Care |
0.1 |
(a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
Security | |
Percent of Total Investments |
(a) | |
Sunny Optical Technology Group Co. Ltd. |
4.1 | % | ||
NetEase Inc. |
4.1 | |||
JDcom Inc, Class A |
4.0 | |||
Baidu Inc. |
3.9 | |||
Xiaomi Corp., Class B |
3.7 | |||
Contemporary Amperex Technology Co. Ltd., Class A |
3.7 | |||
Pinduoduo Inc. |
3.6 | |||
Tencent Holdings Ltd. |
3.5 | |||
Alibaba Group Holding Ltd. |
3.4 | |||
Meituan, Class B |
3.2 |
4 |
2 0 2 2 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 February 28,2022 | iShares® MSCI Japan Equal Weighted ETF |
Investment Objective
The iShares MSCI Japan Equal Weighted ETF (the “Fund”) seeks to track the investment results of an index composed of equal weighted Japanese equities, as represented by the MSCI Japan Equal Weighted Index (USD) (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 |
(8.24 | )% | (6.02 | )% | 4.62 | % | (6.02 | )% | 14.44 | % | ||||||||||||||
Fund Market |
(7.66 | ) | (6.54 | ) | 4.82 | (6.54 | ) | 15.12 | ||||||||||||||||
Index |
(9.25 | ) | (6.93 | ) | 4.13 | (6.93 | ) | 12.85 |
The inception date of the Fund was 3/5/19. The first day of secondary market trading was 3/7/19.
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 7 for more information.
Expense Example
Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
Beginning Account Value (09/01/21) |
|
|
Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(a) |
|
Beginning Account Value (09/01/21) |
|
|
Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(a) |
|
Annualized Expense Ratio |
| ||||||||||
$ 1,000.00 | $ | 917.60 | $ | 0.71 | $ | 1,000.00 | $ | 1,024.10 | $ | 0.75 | 0.15 | % |
(a) |
Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). 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” for more information. |
Portfolio Information
ALLOCATION BY SECTOR
Sector | |
Percent of Total Investments |
(a) | |
Industrials |
23.6 | % | ||
Consumer Discretionary |
13.6 | |||
Information Technology |
13.5 | |||
Consumer Staples |
10.2 | |||
Financials |
8.6 | |||
Health Care |
7.9 | |||
Materials |
7.3 | |||
Communication Services |
6.3 | |||
Real Estate |
5.8 | |||
Utilities |
2.0 | |||
Energy |
1.2 |
(a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
Security | |
Percent of Total Investments |
(a) | |
Nintendo Co. Ltd. |
0.7 | % | ||
Tokyo Electron Ltd. |
0.7 | |||
USS Co. Ltd. |
0.6 | |||
GMO Payment Gateway Inc. |
0.5 | |||
Nippon Yusen KK |
0.5 | |||
Oriental Land Co. Ltd./Japan |
0.5 | |||
FANUC Corp. |
0.5 | |||
Kobayashi Pharmaceutical Co. Ltd. |
0.5 | |||
Trend Micro Inc/Japan |
0.5 | |||
Rinnai Corp. |
0.5 |
F U N D S U M M A R Y |
5 |
Fund Summary as of February 28, 2022 | iShares® MSCI Japan Value ETF |
Investment Objective
The iShares MSCI Japan Value ETF (the “Fund”) seeks to track the investment results of an index composed of large- and mid-capitalization Japanese equities with value characteristics and relatively lower valuations, as represented by the MSCI Japan Value Index (USD) (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 |
(0.74 | )% | 2.48 | % | 6.35 | % | 2.48 | % | 20.20 | % | ||||||||||||||
Fund Market |
(0.57 | ) | 1.28 | 6.48 | 1.28 | 20.66 | ||||||||||||||||||
Index |
(0.97 | ) | 2.49 | 6.26 | 2.49 | 19.88 |
The inception date of the Fund was 3/5/19. The first day of secondary market trading was 3/7/19.
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 7 for more information.
Expense Example
Actual | Hypothetical 5% Return | |||||||||||||||||||||||||||||
|
Beginning Account Value (09/01/21) |
|
|
Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(a) |
|
Beginning Account Value (09/01/21) |
|
|
Ending Account Value (02/28/22) |
|
|
Expenses Paid During the Period |
(a) |
|
Annualized Expense Ratio |
| ||||||||||
$ 1,000.00 | $ 992.60 | $ 0.74 | $ 1,000.00 | $ 1,024.10 | $ 0.75 | 0.15 | % |
(a) |
Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). 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” for more information. |
Portfolio Information
ALLOCATION BY SECTOR
Sector | |
Percent of Total Investments |
(a) | |
Industrials |
20.9 | % | ||
Consumer Discretionary |
19.8 | |||
Financials |
17.8 | |||
Communication Services |
10.2 | |||
Consumer Staples |
6.8 | |||
Real Estate |
6.4 | |||
Health Care |
6.0 | |||
Materials |
5.0 | |||
Information Technology |
3.9 | |||
Utilities |
1.7 | |||
Energy |
1.5 |
(a) |
Excludes money market funds. |
TEN LARGEST HOLDINGS
Security | |
Percent of Total Investments |
(a) | |
Toyota Motor Corp. |
10.1 | % | ||
Mitsubishi UFJ Financial Group Inc. |
3.8 | |||
SoftBank Group Corp. |
2.8 | |||
KDDI Corp. |
2.8 | |||
Honda Motor Co. Ltd. |
2.6 | |||
Takeda Pharmaceutical Co. Ltd. |
2.5 | |||
Sumitomo Mitsui Financial Group Inc. |
2.4 | |||
Mitsubishi Corp. |
2.2 | |||
Seven & i Holdings Co. Ltd. |
2.0 | |||
SoftBank Corp. |
1.9 |
6 |
2 0 2 2 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 |
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 each 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. Beginning August 10, 2020, the price used to calculate market return (“Market Price”) is the closing price. Prior to August 10, 2020, Market Price was determined 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.
Shareholders of each Fund may incur the following charges: (1) transactional expenses, including brokerage commissions on purchases and sales of fund shares and (2) ongoing expenses, including management fees and other fund expenses. The expense examples shown (which are based on a hypothetical investment of $1,000 invested at the beginning of the period and held through the end of the period) are intended to assist shareholders both in calculating expenses based on an investment in each Fund and in comparing these expenses with similar costs of investing in other funds.
The expense examples provide information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number under the heading entitled “Expenses Paid During Period.”
The expense examples also provide information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in a Funds and other funds, compare the 5% hypothetical examples with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
The expenses shown in the expense examples are intended to highlight shareholders’ ongoing costs only and do not reflect any transactional expenses, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing expenses only and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses 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 |
7 |
Schedule of Investments (unaudited) February 28, 2022 |
iShares® MSCI China Multisector Tech ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
|
||||||||
Common Stocks |
||||||||
Capital Markets — 1.0% | ||||||||
East Money Information Co. Ltd., Class A |
18,800 | $ | 80,131 | |||||
Hithink RoyalFlush Information Network Co. Ltd., Class A |
800 | 13,739 | ||||||
|
|
|||||||
93,870 | ||||||||
Communications Equipment — 2.3% | ||||||||
Addsino Co. Ltd., Class A |
3,200 | 7,627 | ||||||
Beijing BDStar Navigation Co. Ltd., Class A(a) |
800 | 4,732 | ||||||
BYD Electronic International Co. Ltd. |
20,000 | 56,436 | ||||||
Fiberhome Telecommunication Technologies Co. Ltd., Class A |
1,600 | 4,372 | ||||||
Guangzhou Haige Communications Group Inc. Co., Class A |
2,400 | 3,798 | ||||||
Hengtong Optic-Electric Co. Ltd., Class A |
3,600 | 8,449 | ||||||
Shenzhen Sunway Communication Co. Ltd., Class A |
2,000 | 6,766 | ||||||
Tianjin 712 Communication & Broadcasting Co. Ltd., Class A |
1,200 | 6,545 | ||||||
Yealink Network Technology Corp. Ltd., Class A |
1,600 | 19,395 | ||||||
Zhongji Innolight Co. Ltd., Class A |
1,600 | 9,754 | ||||||
ZTE Corp., Class A |
6,800 | 31,468 | ||||||
ZTE Corp., Class H |
22,400 | 55,184 | ||||||
|
|
|||||||
214,526 | ||||||||
Consumer Finance — 1.8% | ||||||||
360 DigiTech Inc., ADR |
2,604 | 48,825 | ||||||
Lufax Holding Ltd., ADR(a) |
18,048 | 116,770 | ||||||
|
|
|||||||
165,595 | ||||||||
Diversified Consumer Services — 1.2% | ||||||||
China Education Group Holdings Ltd. |
4,000 | 3,427 | ||||||
New Oriental Education & Technology Group Inc., ADR(a) |
45,616 | 68,880 | ||||||
TAL Education Group, ADR(a) |
12,780 | 36,295 | ||||||
|
|
|||||||
108,602 | ||||||||
Electrical Equipment — 7.3% | ||||||||
Contemporary Amperex Technology Co. Ltd., Class A |
4,000 | 342,637 | ||||||
Eve Energy Co. Ltd., Class A |
3,600 | 51,663 | ||||||
Fangda Carbon New Material Co. Ltd., Class A |
7,200 | 11,805 | ||||||
Ginlong Technologies Co. Ltd., Class A |
400 | 16,151 | ||||||
Gotion High-tech Co. Ltd., Class A(a) |
3,200 | 21,958 | ||||||
Hongfa Technology Co. Ltd., Class A |
1,200 | 11,993 | ||||||
Jiangsu Zhongtian Technology Co. Ltd., Class A |
5,200 | 15,455 | ||||||
Ningbo Ronbay New Energy Technology Co. Ltd. |
832 | 19,428 | ||||||
Sieyuan Electric Co. Ltd. |
1,600 | 12,004 | ||||||
Sungrow Power Supply Co. Ltd., Class A |
800 | 15,491 | ||||||
Sunwoda Electronic Co. Ltd., Class A |
3,200 | 18,771 | ||||||
TBEA Co. Ltd., Class A |
6,800 | 21,912 | ||||||
Zhejiang Chint Electrics Co. Ltd., Class A |
3,600 | 28,693 | ||||||
Zhejiang HangKe Technology Inc. Co., Class A |
800 | 9,853 | ||||||
Zhuzhou CRRC Times Electric Co. Ltd. |
16,400 | 85,485 | ||||||
|
|
|||||||
683,299 | ||||||||
Electronic Equipment, Instruments & Components — 12.8% | ||||||||
AAC Technologies Holdings Inc. |
22,000 | 60,153 | ||||||
Avary Holding Shenzhen Co. Ltd., Class A |
2,800 | 15,430 | ||||||
Beijing Yuanliu Hongyuan Electronic Technology Co. Ltd., Class A |
400 | 10,250 | ||||||
BOE Technology Group Co. Ltd., Class A |
65,200 | 48,661 | ||||||
Chaozhou Three-Circle Group Co. Ltd., Class A |
3,600 | 19,938 | ||||||
China Railway Signal & Communication Corp. Ltd., Class A |
12,000 | 9,233 | ||||||
China Zhenhua Group Science & Technology Co. Ltd., Class A |
1,200 | 22,367 | ||||||
Foxconn Industrial Internet Co. Ltd., Class A |
13,600 | 24,104 | ||||||
GoerTek Inc., Class A |
6,400 | 44,809 | ||||||
Guangzhou Shiyuan Electronic Technology Co. Ltd., Class A |
1,200 | 16,343 | ||||||
Huagong Tech Co. Ltd., Class A |
1,600 | 6,249 | ||||||
Kingboard Holdings Ltd. |
20,000 | 93,563 |
Security | Shares | Value | ||||||
|
||||||||
Electronic Equipment, Instruments & Components (continued) | ||||||||
Kingboard Laminates Holdings Ltd. |
26,000 | $ | 43,325 | |||||
Lens Technology Co. Ltd., Class A |
10,000 | 23,134 | ||||||
Leyard Optoelectronic Co. Ltd., Class A |
5,200 | 7,000 | ||||||
Lingyi iTech Guangdong Co., Class A(a) |
14,800 | 14,125 | ||||||
Luxshare Precision Industry Co. Ltd., Class A |
12,800 | 88,769 | ||||||
Maxscend Microelectronics Co. Ltd., Class A |
800 | 34,378 | ||||||
OFILM Group Co. Ltd., Class A(a) |
7,200 | 9,157 | ||||||
Raytron Technology Co. Ltd., Class A |
800 | 8,073 | ||||||
Shengyi Technology Co. Ltd., Class A |
4,000 | 12,369 | ||||||
Shennan Circuits Co. Ltd., Class A |
800 | 14,913 | ||||||
Shenzhen Kaifa Technology Co. Ltd., Class A |
2,000 | 4,333 | ||||||
Shenzhen Sunlord Electronics Co. Ltd., Class A |
1,600 | 8,152 | ||||||
Sunny Optical Technology Group Co. Ltd. |
16,000 | 383,423 | ||||||
Suzhou Dongshan Precision Manufacturing Co. Ltd., Class A |
3,200 | 11,309 | ||||||
Tianma Microelectronics Co. Ltd., Class A |
2,800 | 5,203 | ||||||
Unisplendour Corp. Ltd., Class A |
5,600 | 19,521 | ||||||
Universal Scientific Industrial Shanghai Co. Ltd., Class A |
2,800 | 6,242 | ||||||
Westone Information Industry Inc., Class A |
1,600 | 11,713 | ||||||
Wingtech Technology Co. Ltd., Class A |
2,400 | 44,726 | ||||||
Wuhan Guide Infrared Co. Ltd., Class A |
4,400 | 15,649 | ||||||
Wuhu Token Science Co. Ltd., Class A |
4,800 | 7,374 | ||||||
WUS Printed Circuit Kunshan Co. Ltd., Class A |
3,600 | 9,625 | ||||||
Xiamen Faratronic Co. Ltd. |
400 | 13,573 | ||||||
Zhejiang Dahua Technology Co. Ltd., Class A |
5,200 | 15,484 | ||||||
Zhuzhou Hongda Electronics Corp. Ltd |
800 | 10,662 | ||||||
|
|
|||||||
1,193,332 | ||||||||
Entertainment — 8.2% | ||||||||
Alibaba Pictures Group Ltd.(a) |
40,000 | 3,999 | ||||||
Beijing Enlight Media Co. Ltd., Class A |
6,000 | 8,990 | ||||||
Bilibili Inc., ADR(a) |
4,984 | 157,544 | ||||||
Giant Network Group Co. Ltd., Class A |
4,000 | 6,072 | ||||||
iQIYI Inc., ADR(a) |
8,596 | 35,588 | ||||||
Kingsoft Corp. Ltd. |
29,600 | 110,698 | ||||||
Kunlun Tech Co. Ltd., Class A |
2,400 | 6,725 | ||||||
Mango Excellent Media Co. Ltd., Class A |
3,600 | 19,616 | ||||||
NetEase Inc |
19,600 | 379,097 | ||||||
Perfect World Co. Ltd., Class A |
4,400 | 9,240 | ||||||
Tencent Music Entertainment Group, ADR(a) |
824 | 4,442 | ||||||
Wuhu Sanqi Interactive Entertainment Network Technology Group Co. Ltd., Class A |
4,000 | 13,284 | ||||||
Zhejiang Century Huatong Group Co. Ltd., Class A(a) |
15,200 | 15,760 | ||||||
|
|
|||||||
771,055 | ||||||||
Health Care Technology — 0.1% | ||||||||
Winning Health Technology Group Co. Ltd., Class A |
4,400 | 7,998 | ||||||
|
|
|||||||
Household Durables — 4.2% | ||||||||
Ecovacs Robotics Co. Ltd., Class A |
800 | 17,157 | ||||||
Gree Electric Appliances Inc. of Zhuhai, Class A |
5,200 | 30,269 | ||||||
Haier Smart Home Co. Ltd., Class A |
10,800 | 43,784 | ||||||
Haier Smart Home Co. Ltd., Class H |
68,000 | 238,277 | ||||||
Hang Zhou Great Star Industrial Co. Ltd., Class A(a) |
2,400 | 7,638 | ||||||
Hangzhou Robam Appliances Co. Ltd., Class A |
1,600 | 8,463 | ||||||
Shenzhen MTC Co. Ltd., Class A(a) |
10,800 | 7,568 | ||||||
TCL Technology Group Corp., Class A |
24,400 | 21,565 | ||||||
Xiamen Intretech Inc., Class A |
1,600 | 7,538 | ||||||
Zhejiang Supor Co. Ltd., Class A |
1,200 | 9,636 | ||||||
|
|
|||||||
391,895 | ||||||||
Interactive Media & Services — 12.6% | ||||||||
Autohome Inc., ADR |
2,316 | 70,847 |
8 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI China Multisector Tech ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
|
||||||||
Interactive Media & Services (continued) | ||||||||
Baidu Inc., ADR(a) |
2,380 | $ | 362,807 | |||||
Hello Group Inc., ADR |
4,768 | 45,439 | ||||||
JOYY Inc., ADR |
1,660 | 76,841 | ||||||
Kanzhun Ltd.(a) |
2,536 | 81,913 | ||||||
Kuaishou Technology(a)(b) |
14,400 | 166,643 | ||||||
Tencent Holdings Ltd. |
6,000 | 323,768 | ||||||
Weibo Corp., ADR(a) |
1,908 | 52,336 | ||||||
|
|
|||||||
1,180,594 | ||||||||
Internet & Direct Marketing Retail — 16.7% | ||||||||
Alibaba Group Holding Ltd.(a) |
24,400 | 321,198 | ||||||
Alibaba Health Information Technology Ltd.(a) |
8,000 | 5,602 | ||||||
China Ruyi Holdings Ltd.(a) |
96,000 | 28,572 | ||||||
Dada Nexus Ltd., ADR(a) |
1,912 | 15,889 | ||||||
JD Health International Inc.(a)(b) |
2,200 | 16,420 | ||||||
JDcom Inc, Class A(a) |
10,400 | 371,482 | ||||||
Meituan, Class B(a)(b) |
13,600 | 302,126 | ||||||
Pinduoduo Inc., ADR(a) |
6,520 | 338,127 | ||||||
Ping An Healthcare and Technology Co. Ltd.(a)(b) |
14,000 | 43,176 | ||||||
Vipshop Holdings Ltd., ADR(a) |
13,428 | 116,421 | ||||||
|
|
|||||||
1,559,013 | ||||||||
IT Services — 3.2% | ||||||||
Beijing Sinnet Technology Co. Ltd., Class A |
3,600 | 8,575 | ||||||
China TransInfo Technology Co. Ltd., Class A |
4,000 | 8,837 | ||||||
Chinasoft International Ltd. |
80,000 | 72,992 | ||||||
Chindata Group Holdings Ltd., ADR(a) |
3,712 | 20,379 | ||||||
DHC Software Co. Ltd., Class A |
4,000 | 5,244 | ||||||
GDS Holdings Ltd., ADR(a) |
2,680 | 119,314 | ||||||
Kingsoft Cloud Holdings Ltd., ADR(a) |
96 | 647 | ||||||
Lakala Payment Co. Ltd., Class A |
1,600 | 6,854 | ||||||
TravelSky Technology Ltd., Class H |
28,000 | 52,742 | ||||||
|
|
|||||||
295,584 | ||||||||
Machinery — 2.4% | ||||||||
Haitian International Holdings Ltd. |
20,000 | 53,286 | ||||||
Hefei Meiya Optoelectronic Technology Inc., Class A |
1,200 | 6,886 | ||||||
Jiangsu Hengli Hydraulic Co. Ltd., Class A |
2,800 | 29,845 | ||||||
Luoyang Xinqianglian Slewing Bearing Co. Ltd. |
400 | 9,661 | ||||||
North Industries Group Red Arrow Co. Ltd., Class A(a) |
2,800 | 10,013 | ||||||
Riyue Heavy Industry Co. Ltd., Class A |
2,000 | 8,747 | ||||||
Shenzhen Inovance Technology Co. Ltd., Class A |
4,800 | 48,854 | ||||||
Wuxi Lead Intelligent Equipment Co. Ltd., Class A |
1,600 | 17,248 | ||||||
Wuxi Shangji Automation Co. Ltd., Class A |
800 | 20,198 | ||||||
Yantai Eddie Precision Machinery Co. Ltd., Class A |
1,600 | 7,837 | ||||||
Zhejiang Sanhua Intelligent Controls Co. Ltd., Class A |
4,000 | 12,798 | ||||||
|
|
|||||||
225,373 | ||||||||
Media — 0.0% | ||||||||
China Literature Ltd.(a)(b) |
800 | 4,342 | ||||||
|
|
|||||||
Semiconductors & Semiconductor Equipment — 12.9% | ||||||||
Advanced Micro-Fabrication Equipment Inc., Class A(a) |
800 | 16,321 | ||||||
China Resources Microelectronics Ltd. |
2,064 | 19,170 | ||||||
Daqo New Energy Corp., ADR(a) |
1,768 | 84,793 | ||||||
Flat Glass Group Co. Ltd., Class A |
2,800 | 21,921 | ||||||
Flat Glass Group Co. Ltd., Class H |
12,000 | 49,622 | ||||||
GCL System Integration Technology Co. Ltd., Class A(a) |
9,200 | 5,364 | ||||||
Gigadevice Semiconductor Beijing Inc., Class A |
1,200 | 29,384 | ||||||
Hangzhou First Applied Material Co. Ltd., Class A |
1,600 | 30,364 | ||||||
Hangzhou Silan Microelectronics Co. Ltd., Class A |
2,800 | 25,594 | ||||||
Hua Hong Semiconductor Ltd.(a)(b) |
16,000 | 83,356 | ||||||
Ingenic Semiconductor Co. Ltd., Class A |
800 | 14,194 |
Security | Shares | Value | ||||||
|
||||||||
Semiconductors & Semiconductor Equipment (continued) | ||||||||
JA Solar Technology Co. Ltd., Class A |
3,200 | $ | 48,481 | |||||
JCET Group Co. Ltd., Class A |
3,200 | 14,296 | ||||||
LONGi Green Energy Technology Co. Ltd., Class A |
10,000 | 124,475 | ||||||
Montage Technology Co. Ltd., Class A |
2,400 | 29,502 | ||||||
National Silicon Industry Group Co. Ltd., Class A(a) |
4,000 | 15,546 | ||||||
NAURA Technology Group Co. Ltd., Class A |
800 | 38,781 | ||||||
SG Micro Corp., Class A |
400 | 22,139 | ||||||
Shenzhen Goodix Technology Co. Ltd., Class A |
800 | 11,585 | ||||||
Shenzhen SC New Energy Technology Corp., Class A |
800 | 11,221 | ||||||
StarPower Semiconductor Ltd., Class A |
400 | 23,068 | ||||||
Tianjin Zhonghuan Semiconductor Co. Ltd., Class A |
5,600 | 42,876 | ||||||
Tianshui Huatian Technology Co. Ltd., Class A |
5,600 | 10,673 | ||||||
TongFu Microelectronics Co. Ltd., Class A |
2,800 | 8,100 | ||||||
Trina Solar Co. Ltd. |
3,148 | 38,518 | ||||||
Unigroup Guoxin Microelectronics Co. Ltd., Class A |
1,200 | 42,142 | ||||||
Will Semiconductor Co. Ltd. Shanghai, Class A |
1,600 | 62,789 | ||||||
Xinyi Solar Holdings Ltd |
144,000 | 261,557 | ||||||
Zhejiang Jingsheng Mechanical & Electrical Co. Ltd., Class A |
2,400 | 24,874 | ||||||
|
|
|||||||
1,210,706 | ||||||||
Software — 5.9% | ||||||||
360 Security Technology Inc., Class A(a) |
12,800 | 21,306 | ||||||
Beijing E-Hualu Information Technology Co. Ltd., Class A |
1,600 | 7,133 | ||||||
Beijing Kingsoft Office Software Inc., Class A |
800 | 27,141 | ||||||
Beijing Shiji Information Technology Co. Ltd., Class A |
2,000 | 7,598 | ||||||
Hundsun Technologies Inc., Class A |
2,800 | 23,270 | ||||||
Iflytek Co. Ltd., Class A |
4,400 | 34,383 | ||||||
Kingdee International Software Group Co. Ltd.(a) |
80,000 | 197,731 | ||||||
Ming Yuan Cloud Group Holdings Ltd. |
20,000 | 39,474 | ||||||
NavInfo Co. Ltd., Class A(a) |
4,400 | 11,980 | ||||||
Sangfor Technologies Inc., Class A |
800 | 18,555 | ||||||
Shanghai Baosight Software Co. Ltd., Class A |
2,400 | 20,530 | ||||||
Shanghai Baosight Software Co. Ltd., Class B |
11,600 | 50,095 | ||||||
Thunder Software Technology Co. Ltd., Class A |
800 | 17,822 | ||||||
Topsec Technologies Group Inc., Class A |
2,400 | 5,610 | ||||||
Weimob Inc.(a)(b) |
60,000 | 39,681 | ||||||
Yonyou Network Technology Co. Ltd., Class A |
6,400 | 31,939 | ||||||
|
|
|||||||
554,248 | ||||||||
Specialty Retail — 0.4% | ||||||||
GOME Retail Holdings Ltd.(a) |
352,000 | 26,194 | ||||||
Suningcom Co Ltd, Class A(a) |
18,000 | 10,268 | ||||||
|
|
|||||||
36,462 | ||||||||
Technology Hardware, Storage & Peripherals — 7.0% | ||||||||
China Greatwall Technology Group Co. Ltd., Class A |
6,400 | 13,539 | ||||||
GRG Banking Equipment Co. Ltd., Class A |
3,600 | 6,803 | ||||||
Inspur Electronic Information Industry Co. Ltd., Class A |
2,800 | 14,641 | ||||||
Lenovo Group Ltd. |
216,000 | 240,531 | ||||||
Ninestar Corp., Class A |
2,400 | 19,098 | ||||||
Shenzhen Transsion Holding Co. Ltd., Class A |
800 | 17,151 | ||||||
Xiaomi Corp., Class B(a)(b) |
184,800 | 347,834 | ||||||
|
|
|||||||
659,597 | ||||||||
|
|
|||||||
Total Common Stocks — 100.0% (Cost: $9,860,046) |
9,356,091 | |||||||
|
|
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) February 28, 2022 |
iShares® MSCI China Multisector Tech 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, 0.03%(c)(d) |
10,000 | $ | 10,000 | |||||
|
|
|||||||
Total
Short-Term Investments — 0.1% |
|
10,000 | ||||||
|
|
|||||||
Total
Investments in Securities — 100.1% |
|
9,366,091 | ||||||
Other Assets, Less Liabilities — (0.1)% |
|
(9,515 | ) | |||||
|
|
|||||||
Net Assets — 100.0% |
|
$ | 9,356,576 | |||||
|
|
(a) |
Non-income producing security. |
(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) |
Affiliate of the Fund. |
(d) |
Annualized 7-day yield as of period end. |
Affiliates
Investments in issuers considered to be affiliate(s) of the Fund during the period ended February 28, 2022 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
Affiliated Issuer | Value
at 01/25/22(a) |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change
in Unrealized Appreciation (Depreciation) |
Value at 02/28/22 |
Shares Held at 02/28/22 |
Income |
Capital Gain |
|||||||||||||||||||||||||||
BlackRock Cash Funds: Treasury, SL Agency Shares |
$ | — | $ | 10,000(b) | $ | — | $ | — | $ | — | $ | 10,000 | 10,000 | $ | — | $ | — | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
(a) |
Commencement of operations. |
(b) |
Represents net amount purchased (sold). |
Fair Value Hierarchy as of Period End
Various inputs are used in determining the fair value of financial instruments. For a 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 Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.
|
||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
||||||||||||||||
Investments |
||||||||||||||||
Assets |
||||||||||||||||
Common Stocks |
$ | 2,096,403 | $ | 7,259,688 | $ | — | $ | 9,356,091 | ||||||||
Money Market Funds |
10,000 | — | — | 10,000 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 2,106,403 | $ | 7,259,688 | $ | — | $ | 9,366,091 | |||||||||
|
|
|
|
|
|
|
|
See notes to financial statements.
10 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI Japan Equal Weighted ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Common Stocks |
||||||||
Air Freight & Logistics — 0.8% | ||||||||
SG Holdings Co. Ltd. |
1,400 | $ | 29,673 | |||||
Yamato Holdings Co. Ltd. |
1,400 | 27,495 | ||||||
|
|
|||||||
57,168 | ||||||||
Airlines — 0.8% | ||||||||
ANA Holdings Inc.(a) |
1,200 | 26,422 | ||||||
Japan Airlines Co. Ltd.(a) |
1,400 | 27,760 | ||||||
|
|
|||||||
54,182 | ||||||||
Auto Components — 2.3% | ||||||||
Aisin Corp. |
800 | 29,139 | ||||||
Bridgestone Corp. |
700 | 28,827 | ||||||
Denso Corp. |
400 | 28,128 | ||||||
Koito Manufacturing Co. Ltd. |
600 | 31,034 | ||||||
Stanley Electric Co. Ltd. |
1,000 | 23,763 | ||||||
Sumitomo Electric Industries Ltd. |
2,000 | 26,550 | ||||||
|
|
|||||||
167,441 | ||||||||
Automobiles — 3.0% | ||||||||
Honda Motor Co. Ltd. |
1,000 | 30,381 | ||||||
Isuzu Motors Ltd. |
2,000 | 27,049 | ||||||
Mazda Motor Corp.(a) |
3,400 | 25,148 | ||||||
Nissan Motor Co. Ltd.(a) |
5,400 | 25,754 | ||||||
Subaru Corp. |
1,600 | 26,241 | ||||||
Suzuki Motor Corp. |
600 | 23,891 | ||||||
Toyota Motor Corp. |
1,400 | 25,615 | ||||||
Yamaha Motor Co. Ltd. |
1,200 | 26,975 | ||||||
|
|
|||||||
211,054 | ||||||||
Banks — 3.3% | ||||||||
Chiba Bank Ltd/The |
4,000 | 25,144 | ||||||
Concordia Financial Group Ltd. |
6,400 | 26,037 | ||||||
Japan Post Bank Co. Ltd. |
3,000 | 26,323 | ||||||
Mitsubishi UFJ Financial Group Inc. |
4,200 | 25,784 | ||||||
Mizuho Financial Group Inc. |
2,080 | 27,412 | ||||||
Resona Holdings Inc. |
5,800 | 25,939 | ||||||
Shizuoka Bank Ltd/The |
3,400 | 25,137 | ||||||
Sumitomo Mitsui Financial Group Inc. |
800 | 28,370 | ||||||
Sumitomo Mitsui Trust Holdings Inc. |
800 | 28,425 | ||||||
|
|
|||||||
238,571 | ||||||||
Beverages — 1.5% | ||||||||
Asahi Group Holdings Ltd. |
600 | 24,203 | ||||||
Ito En Ltd. |
400 | 23,005 | ||||||
Kirin Holdings Co. Ltd. |
1,600 | 26,601 | ||||||
Suntory Beverage & Food Ltd. |
800 | 31,879 | ||||||
|
|
|||||||
105,688 | ||||||||
Building Products — 1.4% | ||||||||
AGC Inc. |
600 | 26,618 | ||||||
Daikin Industries Ltd. |
100 | 18,480 | ||||||
Lixil Corp. |
1,200 | 26,745 | ||||||
TOTO Ltd. |
600 | 25,258 | ||||||
|
|
|||||||
97,101 | ||||||||
Capital Markets — 1.5% | ||||||||
Daiwa Securities Group Inc. |
4,400 | 26,015 | ||||||
Japan Exchange Group Inc. |
1,400 | 26,217 | ||||||
Nomura Holdings Inc. |
6,000 | 27,378 | ||||||
SBI Holdings Inc/Japan |
1,000 | 26,232 | ||||||
|
|
|||||||
105,842 | ||||||||
Chemicals — 5.3% | ||||||||
Asahi Kasei Corp. |
2,800 | 26,278 |
Security | Shares | Value | ||||||
Chemicals (continued) | ||||||||
JSR Corp. |
800 | $ | 25,166 | |||||
Kansai Paint Co. Ltd. |
1,400 | 28,099 | ||||||
Mitsubishi Chemical Holdings Corp. |
3,800 | 26,995 | ||||||
Mitsubishi Gas Chemical Co. Inc. |
1,600 | 28,387 | ||||||
Mitsui Chemicals Inc. |
1,000 | 25,565 | ||||||
Nippon Paint Holdings Co. Ltd. |
3,200 | 28,640 | ||||||
Nippon Sanso Holdings Corp. |
1,400 | 27,361 | ||||||
Nissan Chemical Corp. |
400 | 22,736 | ||||||
Nitto Denko Corp. |
400 | 29,191 | ||||||
Shin-Etsu Chemical Co. Ltd. |
200 | 31,238 | ||||||
Sumitomo Chemical Co. Ltd. |
5,600 | 26,736 | ||||||
Toray Industries Inc. |
4,800 | 27,373 | ||||||
Tosoh Corp. |
1,600 | 24,829 | ||||||
|
|
|||||||
378,594 | ||||||||
Commercial Services & Supplies — 1.6% | ||||||||
Dai Nippon Printing Co. Ltd. |
1,000 | 26,105 | ||||||
Secom Co. Ltd. |
400 | 29,379 | ||||||
Sohgo Security Services Co. Ltd. |
800 | 28,883 | ||||||
TOPPAN INC. |
1,400 | 27,586 | ||||||
|
|
|||||||
111,953 | ||||||||
Construction & Engineering — 1.5% | ||||||||
Kajima Corp. |
2,000 | 26,917 | ||||||
Obayashi Corp. |
3,400 | 28,468 | ||||||
Shimizu Corp. |
4,200 | 27,801 | ||||||
Taisei Corp. |
800 | 26,601 | ||||||
|
|
|||||||
109,787 | ||||||||
Diversified Financial Services — 1.1% | ||||||||
Mitsubishi HC Capital Inc. |
5,400 | 28,083 | ||||||
ORIX Corp. |
1,400 | 27,752 | ||||||
Tokyo Century Corp. |
600 | 26,305 | ||||||
|
|
|||||||
82,140 | ||||||||
Diversified Telecommunication Services — 0.4% | ||||||||
Nippon Telegraph & Telephone Corp. |
1,000 | 28,741 | ||||||
|
|
|||||||
Electric Utilities — 1.2% | ||||||||
Chubu Electric Power Co. Inc. |
2,800 | 27,968 | ||||||
Kansai Electric Power Co Inc/The |
2,800 | 28,232 | ||||||
Tokyo Electric Power Co. Holdings Inc.(a) |
9,000 | 28,251 | ||||||
|
|
|||||||
84,451 | ||||||||
Electrical Equipment — 1.0% | ||||||||
Fuji Electric Co. Ltd. |
600 | 30,871 | ||||||
Mitsubishi Electric Corp. |
2,200 | 26,610 | ||||||
Nidec Corp. |
200 | 17,387 | ||||||
|
|
|||||||
74,868 | ||||||||
Electronic Equipment, Instruments & Components — 4.0% | ||||||||
Azbil Corp. |
800 | 30,367 | ||||||
Hamamatsu Photonics KK |
600 | 30,403 | ||||||
Hirose Electric Co. Ltd. |
200 | 30,073 | ||||||
Ibiden Co. Ltd. |
600 | 29,303 | ||||||
Kyocera Corp. |
400 | 23,021 | ||||||
Murata Manufacturing Co. Ltd. |
400 | 27,186 | ||||||
Omron Corp. |
400 | 27,219 | ||||||
Shimadzu Corp. |
800 | 28,813 | ||||||
TDK Corp. |
800 | 32,379 | ||||||
Yokogawa Electric Corp. |
1,800 | 29,042 | ||||||
|
|
|||||||
287,806 | ||||||||
Entertainment — 2.9% | ||||||||
Capcom Co. Ltd. |
1,000 | 24,271 |
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) February 28, 2022 |
iShares® MSCI Japan Equal Weighted ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Entertainment (continued) | ||||||||
Koei Tecmo Holdings Co. Ltd |
620 | $ | 21,530 | |||||
Konami Holdings Corp. |
400 | 22,757 | ||||||
Nexon Co. Ltd. |
1,400 | 30,586 | ||||||
Nintendo Co. Ltd. |
100 | 50,645 | ||||||
Square Enix Holdings Co. Ltd. |
600 | 29,261 | ||||||
Toho Co. Ltd./Tokyo |
600 | 25,023 | ||||||
|
|
|||||||
204,073 | ||||||||
Equity Real Estate Investment Trusts (REITs) — 3.1% | ||||||||
Daiwa House REIT Investment Corp. |
10 | 27,120 | ||||||
GLP J-Reit |
18 | 26,874 | ||||||
Japan Metropolitan Fund Invest |
34 | 27,518 | ||||||
Japan Real Estate Investment Corp. |
6 | 32,051 | ||||||
Nippon Building Fund Inc. |
4 | 22,921 | ||||||
Nippon Prologis REIT Inc. |
10 | 29,401 | ||||||
Nomura Real Estate Master Fund Inc. |
20 | 26,375 | ||||||
Orix JREIT Inc. |
20 | 27,980 | ||||||
|
|
|||||||
220,240 | ||||||||
Food & Staples Retailing — 2.7% | ||||||||
Aeon Co. Ltd. |
1,200 | 27,184 | ||||||
Cosmos Pharmaceutical Corp. |
200 | 27,730 | ||||||
Kobe Bussan Co. Ltd. |
800 | 26,488 | ||||||
Lawson Inc. |
600 | 25,017 | ||||||
Seven & i Holdings Co. Ltd. |
600 | 29,195 | ||||||
Tsuruha Holdings Inc. |
400 | 32,158 | ||||||
Welcia Holdings Co. Ltd. |
1,000 | 26,667 | ||||||
|
|
|||||||
194,439 | ||||||||
Food Products — 2.8% | ||||||||
Ajinomoto Co. Inc. |
1,000 | 29,141 | ||||||
Kikkoman Corp. |
400 | 29,819 | ||||||
MEIJI Holdings Co. Ltd. |
400 | 24,007 | ||||||
Nisshin Seifun Group Inc. |
2,000 | 28,388 | ||||||
Nissin Foods Holdings Co. Ltd. |
400 | 31,959 | ||||||
Toyo Suisan Kaisha Ltd. |
600 | 25,222 | ||||||
Yakult Honsha Co. Ltd. |
600 | 32,562 | ||||||
|
|
|||||||
201,098 | ||||||||
Gas Utilities — 0.8% | ||||||||
Osaka Gas Co. Ltd. |
1,600 | 29,282 | ||||||
Tokyo Gas Co. Ltd. |
1,400 | 28,516 | ||||||
|
|
|||||||
57,798 | ||||||||
Health Care Equipment & Supplies — 2.0% | ||||||||
Asahi Intecc Co. Ltd. |
1,400 | 30,230 | ||||||
Hoya Corp. |
200 | 26,054 | ||||||
Olympus Corp. |
1,400 | 28,435 | ||||||
Sysmex Corp. |
400 | 32,020 | ||||||
Terumo Corp. |
800 | 25,983 | ||||||
|
|
|||||||
142,722 | ||||||||
Health Care Providers & Services — 0.4% | ||||||||
Medipal Holdings Corp. |
1,600 | 29,283 | ||||||
|
|
|||||||
Health Care Technology — 0.4% |
||||||||
M3 Inc. |
800 | 30,099 | ||||||
|
|
|||||||
Hotels, Restaurants & Leisure — 0.9% | ||||||||
McDonald’s Holdings Co. Japan Ltd. |
600 | 25,799 | ||||||
Oriental Land Co. Ltd./Japan |
200 | 36,973 | ||||||
|
|
|||||||
62,772 | ||||||||
Household Durables — 3.0% | ||||||||
Iida Group Holdings Co. Ltd. |
1,400 | 25,983 | ||||||
Open House Group Co. Ltd. |
600 | 27,281 |
Security | Shares | Value | ||||||
Household Durables (continued) | ||||||||
Panasonic Corp. |
2,600 | $ | 27,153 | |||||
Rinnai Corp. |
400 | 32,907 | ||||||
Sekisui Chemical Co. Ltd. |
1,600 | 26,202 | ||||||
Sekisui House Ltd. |
1,400 | 28,543 | ||||||
Sharp Corp./Japan |
2,600 | 24,586 | ||||||
Sony Group Corp. |
200 | 20,434 | ||||||
|
|
|||||||
213,089 | ||||||||
Household Products — 0.8% | ||||||||
Lion Corp. |
2,200 | 28,836 | ||||||
Unicharm Corp. |
800 | 30,155 | ||||||
|
|
|||||||
58,991 | ||||||||
Industrial Conglomerates — 0.9% | ||||||||
Hitachi Ltd. |
600 | 29,671 | ||||||
Toshiba Corp. |
800 | 31,896 | ||||||
|
|
|||||||
61,567 | ||||||||
Insurance — 2.6% | ||||||||
Dai-ichi Life Holdings Inc. |
1,200 | 24,922 | ||||||
Japan Post Holdings Co. Ltd. |
3,400 | 28,103 | ||||||
Japan Post Insurance Co. Ltd. |
1,600 | 27,326 | ||||||
MS&AD Insurance Group Holdings Inc. |
800 | 27,069 | ||||||
Sompo Holdings Inc. |
600 | 26,051 | ||||||
T&D Holdings Inc. |
1,800 | 26,142 | ||||||
Tokio Marine Holdings Inc. |
400 | 22,761 | ||||||
|
|
|||||||
182,374 | ||||||||
Interactive Media & Services — 0.8% | ||||||||
Kakaku.com Inc. |
1,200 | 26,401 | ||||||
Z Holdings Corp. |
5,600 | 27,411 | ||||||
|
|
|||||||
53,812 | ||||||||
Internet & Direct Marketing Retail — 1.2% | ||||||||
Mercari Inc.(a) |
1,000 | 31,320 | ||||||
Rakuten Group Inc. |
3,200 | 27,202 | ||||||
ZOZO Inc. |
1,000 | 28,475 | ||||||
|
|
|||||||
86,997 | ||||||||
IT Services — 4.1% | ||||||||
Fujitsu Ltd. |
200 | 29,057 | ||||||
GMO Payment Gateway Inc |
400 | 38,691 | ||||||
Itochu Techno-Solutions Corp. |
1,000 | 25,923 | ||||||
NEC Corp. |
600 | 25,959 | ||||||
Nomura Research Institute Ltd. |
800 | 28,082 | ||||||
NTT Data Corp. |
1,400 | 26,592 | ||||||
Obic Co. Ltd. |
200 | 32,167 | ||||||
Otsuka Corp. |
800 | 31,075 | ||||||
SCSK Corp. |
1,600 | 27,393 | ||||||
TIS Inc. |
1,200 | 28,402 | ||||||
|
|
|||||||
293,341 | ||||||||
Leisure Products — 1.1% | ||||||||
Bandai Namco Holdings Inc. |
400 | 29,324 | ||||||
Shimano Inc. |
100 | 23,287 | ||||||
Yamaha Corp. |
600 | 28,151 | ||||||
|
|
|||||||
80,762 | ||||||||
Machinery — 6.3% | ||||||||
Daifuku Co. Ltd. |
400 | 28,931 | ||||||
FANUC Corp. |
200 | 36,740 | ||||||
Hino Motors Ltd. |
3,000 | 28,190 | ||||||
Hitachi Construction Machinery Co. Ltd. |
1,000 | 24,472 | ||||||
Hoshizaki Corp. |
400 | 27,889 | ||||||
Komatsu Ltd. |
1,200 | 27,605 | ||||||
Kubota Corp. |
1,600 | 28,707 |
12 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI Japan Equal Weighted ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Machinery (continued) | ||||||||
Kurita Water Industries Ltd. |
600 | $ | 24,795 | |||||
Makita Corp. |
800 | 28,513 | ||||||
MINEBEA MITSUMI Inc. |
1,200 | 26,341 | ||||||
MISUMI Group Inc. |
800 | 25,646 | ||||||
Mitsubishi Heavy Industries Ltd. |
1,000 | 29,492 | ||||||
Miura Co. Ltd. |
1,000 | 27,408 | ||||||
NGK Insulators Ltd. |
1,800 | 27,954 | ||||||
Toyota Industries Corp. |
400 | 30,424 | ||||||
Yaskawa Electric Corp. |
600 | 24,022 | ||||||
|
|
|||||||
447,129 | ||||||||
Marine — 1.0% | ||||||||
Mitsui OSK Lines Ltd. |
400 | 32,497 | ||||||
Nippon Yusen KK |
400 | 37,476 | ||||||
|
|
|||||||
69,973 | ||||||||
Media — 1.1% | ||||||||
CyberAgent Inc. |
2,200 | 28,788 | ||||||
Dentsu Group Inc. |
600 | 23,940 | ||||||
Hakuhodo DY Holdings Inc. |
2,000 | 26,577 | ||||||
|
|
|||||||
79,305 | ||||||||
Metals & Mining — 1.6% | ||||||||
Hitachi Metals Ltd.(a) |
1,600 | 28,521 | ||||||
JFE Holdings Inc. |
2,000 | 29,775 | ||||||
Nippon Steel Corp. |
1,600 | 29,294 | ||||||
Sumitomo Metal Mining Co. Ltd. |
600 | 29,930 | ||||||
|
|
|||||||
117,520 | ||||||||
Multiline Retail — 0.7% | ||||||||
Pan Pacific International Holdings Corp. |
1,600 | 26,189 | ||||||
Ryohin Keikaku Co. Ltd. |
1,800 | 26,510 | ||||||
|
|
|||||||
52,699 | ||||||||
Oil, Gas & Consumable Fuels — 1.2% | ||||||||
ENEOS Holdings Inc. |
7,400 | 29,302 | ||||||
Idemitsu Kosan Co. Ltd. |
1,000 | 26,807 | ||||||
Inpex Corp. |
2,800 | 28,861 | ||||||
|
|
|||||||
84,970 | ||||||||
Paper & Forest Products — 0.4% | ||||||||
Oji Holdings Corp. |
5,200 | 26,567 | ||||||
|
|
|||||||
Personal Products — 1.9% | ||||||||
Kao Corp. |
600 | 28,048 | ||||||
Kobayashi Pharmaceutical Co. Ltd. |
400 | 34,260 | ||||||
Kose Corp. |
200 | 22,928 | ||||||
Pola Orbis Holdings Inc. |
1,800 | 28,355 | ||||||
Shiseido Co. Ltd. |
400 | 22,954 | ||||||
|
|
|||||||
136,545 | ||||||||
Pharmaceuticals — 5.1% | ||||||||
Astellas Pharma Inc. |
1,600 | 26,695 | ||||||
Chugai Pharmaceutical Co. Ltd. |
700 | 23,222 | ||||||
Daiichi Sankyo Co. Ltd. |
1,200 | 29,274 | ||||||
Eisai Co. Ltd. |
600 | 29,769 | ||||||
Kyowa Kirin Co. Ltd. |
1,000 | 25,591 | ||||||
Nippon Shinyaku Co. Ltd. |
400 | 26,052 | ||||||
Ono Pharmaceutical Co. Ltd. |
1,200 | 29,544 | ||||||
Otsuka Holdings Co. Ltd. |
800 | 27,579 | ||||||
Santen Pharmaceutical Co. Ltd. |
2,400 | 27,353 | ||||||
Shionogi & Co. Ltd. |
400 | 26,597 | ||||||
Sumitomo Dainippon Pharma Co. Ltd. |
2,600 | 28,534 | ||||||
Taisho Pharmaceutical Holdings Co. Ltd. |
600 | 29,784 |
Security | Shares | Value | ||||||
Pharmaceuticals (continued) | ||||||||
Takeda Pharmaceutical Co. Ltd. |
1,000 | $ | 30,490 | |||||
|
|
|||||||
360,484 | ||||||||
Professional Services — 1.5% | ||||||||
Benefit One Inc. |
1,200 | 27,794 | ||||||
Nihon M&A Center Holdings Inc. |
1,800 | 26,624 | ||||||
Persol Holdings Co. Ltd. |
1,200 | 26,882 | ||||||
Recruit Holdings Co. Ltd. |
600 | 25,326 | ||||||
|
|
|||||||
106,626 | ||||||||
Real Estate Management & Development — 2.7% | ||||||||
Daito Trust Construction Co. Ltd. |
200 | 22,128 | ||||||
Daiwa House Industry Co. Ltd. |
1,000 | 28,360 | ||||||
Hulic Co. Ltd. |
3,000 | 27,330 | ||||||
Mitsubishi Estate Co. Ltd. |
1,800 | 27,483 | ||||||
Mitsui Fudosan Co. Ltd. |
1,200 | 26,707 | ||||||
Nomura Real Estate Holdings Inc. |
1,200 | 29,879 | ||||||
Sumitomo Realty & Development Co. Ltd. |
1,000 | 29,418 | ||||||
|
|
|||||||
191,305 | ||||||||
Road & Rail — 4.1% | ||||||||
Central Japan Railway Co. |
200 | 27,023 | ||||||
East Japan Railway Co. |
400 | 23,763 | ||||||
Hankyu Hanshin Holdings Inc. |
1,000 | 29,917 | ||||||
Keio Corp. |
600 | 24,550 | ||||||
Keisei Electric Railway Co. Ltd. |
1,000 | 28,006 | ||||||
Kintetsu Group Holdings Co. Ltd.(a) |
1,000 | 30,042 | ||||||
Nippon Express Holdings Inc. |
400 | 24,248 | ||||||
Odakyu Electric Railway Co. Ltd. |
1,600 | 26,398 | ||||||
Tobu Railway Co. Ltd. |
1,000 | 24,581 | ||||||
Tokyu Corp. |
2,000 | 26,673 | ||||||
West Japan Railway Co. |
600 | 25,886 | ||||||
|
|
|||||||
291,087 | ||||||||
Semiconductors & Semiconductor Equipment — 2.6% | ||||||||
Advantest Corp. |
400 | 32,146 | ||||||
Lasertec Corp. |
100 | 18,537 | ||||||
Renesas Electronics Corp.(a) |
2,200 | 25,918 | ||||||
Rohm Co. Ltd. |
400 | 31,901 | ||||||
SUMCO Corp. |
1,600 | 26,702 | ||||||
Tokyo Electron Ltd. |
100 | 49,078 | ||||||
|
|
|||||||
184,282 | ||||||||
Software — 0.9% | ||||||||
Oracle Corp. Japan |
400 | 28,570 | ||||||
Trend Micro Inc/Japan |
600 | 33,520 | ||||||
|
|
|||||||
62,090 | ||||||||
Specialty Retail — 1.3% | ||||||||
Hikari Tsushin Inc. |
200 | 24,852 | ||||||
Nitori Holdings Co. Ltd. |
200 | 30,096 | ||||||
USS Co. Ltd. |
2,400 | 39,869 | ||||||
|
|
|||||||
94,817 | ||||||||
Technology Hardware, Storage & Peripherals — 1.9% | ||||||||
Brother Industries Ltd. |
1,400 | 25,481 | ||||||
Canon Inc. |
1,200 | 28,240 | ||||||
FUJIFILM Holdings Corp. |
400 | 25,426 | ||||||
Ricoh Co. Ltd. |
3,000 | 25,592 | ||||||
Seiko Epson Corp. |
1,800 | 27,685 | ||||||
|
|
|||||||
132,424 | ||||||||
Tobacco — 0.4% | ||||||||
Japan Tobacco Inc. |
1,400 | 25,748 | ||||||
|
|
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) February 28, 2022 |
iShares® MSCI Japan Equal Weighted ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Trading Companies & Distributors — 2.8% | ||||||||
ITOCHU Corp. |
800 | $ | 26,071 | |||||
Marubeni Corp. |
2,800 | 29,391 | ||||||
Mitsubishi Corp. |
800 | 26,899 | ||||||
Mitsui & Co. Ltd. |
1,200 | 29,919 | ||||||
MonotaRO Co. Ltd. |
1,600 | 30,117 | ||||||
Sumitomo Corp. |
1,800 | 29,368 | ||||||
Toyota Tsusho Corp. |
600 | 24,909 | ||||||
|
|
|||||||
196,674 | ||||||||
Wireless Telecommunication Services — 1.1% | ||||||||
KDDI Corp. |
800 | 26,033 | ||||||
SoftBank Corp. |
2,200 | 27,796 | ||||||
SoftBank Group Corp. |
600 | 26,925 | ||||||
|
|
|||||||
80,754 | ||||||||
|
|
|||||||
Total
Common Stocks — 99.8% |
7,109,843 | |||||||
|
|
|||||||
Total
Investments in Securities — 99.8% |
7,109,843 | |||||||
Other Assets, Less Liabilities — 0.2% |
12,137 | |||||||
|
|
|||||||
Net Assets — 100.0% |
$ | 7,121,980 | ||||||
|
|
(a) |
Non-income producing security. |
Derivative Financial Instruments Outstanding as of Period End
Futures Contracts
|
||||||||||||||||
Description | Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
||||||||||||||||
Long Contracts |
||||||||||||||||
Mini TOPIX Index |
1 | 03/10/22 | $ | 16 | $ | (890 | ) | |||||||||
|
|
Derivative Financial Instruments Categorized by Risk Exposure
As of period end, 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) |
$ | 890 | ||
|
|
(a) |
Net cumulative unrealized 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 period ended February 28, 2022, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
||||
Equity Contracts |
||||
|
||||
Net Realized Gain (Loss) from: |
||||
Futures contracts |
$ | 82 | ||
|
|
|||
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
Futures contracts |
$ | (953 | ) | |
|
|
14 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI Japan Equal Weighted ETF |
Average Quarterly Balances of Outstanding Derivative Financial Instruments
Futures contracts: |
||||
Average notional value of contracts — long |
$ | 28,110 |
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Hierarchy as of Period End
Various inputs are used in determining the fair value of financial instruments. For a 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 Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.
|
||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
||||||||||||||||
Investments |
||||||||||||||||
Assets |
||||||||||||||||
Common Stocks |
$ | — | $ | 7,109,843 | $ | — | $ | 7,109,843 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Derivative financial instruments(a) |
||||||||||||||||
Liabilities |
||||||||||||||||
Futures Contracts |
$ | — | $ | (890 | ) | $ | — | $ | (890 | ) | ||||||
|
|
|
|
|
|
|
|
(a) |
Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument. |
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) February 28, 2022 |
iShares® MSCI Japan Value ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Common Stocks |
||||||||
Airlines — 0.2% | ||||||||
ANA Holdings Inc.(a) |
3,500 | $ | 77,064 | |||||
Japan Airlines Co. Ltd.(a) |
3,500 | 69,400 | ||||||
|
|
|||||||
146,464 | ||||||||
Auto Components — 2.2% | ||||||||
Aisin Corp. |
7,200 | 262,255 | ||||||
Bridgestone Corp. |
28,000 | 1,153,066 | ||||||
Stanley Electric Co. Ltd. |
7,000 | 166,339 | ||||||
Sumitomo Electric Industries Ltd. |
38,500 | 511,092 | ||||||
|
|
|||||||
2,092,752 | ||||||||
Automobiles — 14.7% | ||||||||
Honda Motor Co. Ltd. |
80,500 | 2,445,662 | ||||||
Isuzu Motors Ltd. |
14,000 | 189,344 | ||||||
Mazda Motor Corp.(a) |
28,000 | 207,098 | ||||||
Nissan Motor Co. Ltd.(a) |
115,500 | 550,841 | ||||||
Subaru Corp. |
31,500 | 516,625 | ||||||
Suzuki Motor Corp. |
8,700 | 346,416 | ||||||
Toyota Motor Corp. |
521,500 | 9,541,457 | ||||||
Yamaha Motor Co. Ltd. |
7,300 | 164,101 | ||||||
|
|
|||||||
13,961,544 | ||||||||
Banks — 9.7% | ||||||||
Chiba Bank Ltd/The |
24,600 | 154,634 | ||||||
Concordia Financial Group Ltd. |
52,600 | 213,992 | ||||||
Japan Post Bank Co. Ltd. |
21,000 | 184,261 | ||||||
Mitsubishi UFJ Financial Group Inc. |
588,500 | 3,612,792 | ||||||
Mizuho Financial Group Inc. |
119,050 | 1,568,974 | ||||||
Resona Holdings Inc. |
101,600 | 454,385 | ||||||
Shizuoka Bank Ltd/The |
21,000 | 155,256 | ||||||
Sumitomo Mitsui Financial Group Inc. |
63,000 | 2,234,122 | ||||||
Sumitomo Mitsui Trust Holdings Inc. |
17,500 | 621,810 | ||||||
|
|
|||||||
9,200,226 | ||||||||
Beverages — 2.0% | ||||||||
Asahi Group Holdings Ltd. |
21,900 | 883,432 | ||||||
Kirin Holdings Co. Ltd. |
42,000 | 698,269 | ||||||
Suntory Beverage & Food Ltd. |
7,000 | 278,944 | ||||||
|
|
|||||||
1,860,645 | ||||||||
Building Products — 0.9% | ||||||||
AGC Inc. |
10,500 | 465,807 | ||||||
Lixil Corp. |
10,500 | 234,017 | ||||||
TOTO Ltd. |
3,500 | 147,339 | ||||||
|
|
|||||||
847,163 | ||||||||
Capital Markets — 1.5% | ||||||||
Daiwa Securities Group Inc. |
70,000 | 413,875 | ||||||
Nomura Holdings Inc. |
150,500 | 686,743 | ||||||
SBI Holdings Inc/Japan |
12,100 | 317,406 | ||||||
|
|
|||||||
1,418,024 | ||||||||
Chemicals — 2.9% | ||||||||
Asahi Kasei Corp. |
63,000 | 591,244 | ||||||
Mitsubishi Chemical Holdings Corp. |
42,000 | 298,361 | ||||||
Mitsubishi Gas Chemical Co. Inc. |
7,000 | 124,194 | ||||||
Mitsui Chemicals Inc. |
10,500 | 268,428 | ||||||
Nitto Denko Corp. |
7,000 | 510,849 | ||||||
Sumitomo Chemical Co. Ltd. |
73,500 | 350,906 | ||||||
Toray Industries Inc. |
66,600 | 379,799 | ||||||
Tosoh Corp. |
14,000 | 217,253 | ||||||
|
|
|||||||
2,741,034 |
Security | Shares | Value | ||||||
Commercial Services & Supplies — 0.8% | ||||||||
Dai Nippon Printing Co. Ltd. |
10,500 | $ | 274,099 | |||||
Secom Co. Ltd. |
3,500 | 257,062 | ||||||
TOPPAN INC. |
14,000 | 275,861 | ||||||
|
|
|||||||
807,022 | ||||||||
Construction & Engineering — 1.1% | ||||||||
Kajima Corp. |
21,100 | 283,974 | ||||||
Obayashi Corp. |
31,500 | 263,749 | ||||||
Shimizu Corp. |
28,000 | 185,337 | ||||||
Taisei Corp. |
10,500 | 349,140 | ||||||
|
|
|||||||
1,082,200 | ||||||||
Diversified Financial Services — 1.5% | ||||||||
Mitsubishi HC Capital Inc. |
31,500 | 163,814 | ||||||
ORIX Corp. |
59,500 | 1,179,476 | ||||||
Tokyo Century Corp. |
1,800 | 78,915 | ||||||
|
|
|||||||
1,422,205 | ||||||||
Diversified Telecommunication Services — 1.8% | ||||||||
Nippon Telegraph & Telephone Corp. |
59,600 | 1,712,957 | ||||||
|
|
|||||||
Electric Utilities — 0.9% | ||||||||
Chubu Electric Power Co. Inc. |
31,500 | 314,643 | ||||||
Kansai Electric Power Co Inc/The |
35,000 | 352,896 | ||||||
Tokyo Electric Power Co. Holdings Inc.(a) |
73,600 | 231,030 | ||||||
|
|
|||||||
898,569 | ||||||||
Electrical Equipment — 1.5% | ||||||||
Fuji Electric Co. Ltd. |
7,000 | 360,162 | ||||||
Mitsubishi Electric Corp. |
91,000 | 1,100,692 | ||||||
|
|
|||||||
1,460,854 | ||||||||
Electronic Equipment, Instruments & Components — 1.1% | ||||||||
Hirose Electric Co. Ltd. |
600 | 90,217 | ||||||
Kyocera Corp. |
14,600 | 840,274 | ||||||
Yokogawa Electric Corp. |
7,000 | 112,940 | ||||||
|
|
|||||||
1,043,431 | ||||||||
Entertainment — 0.1% | ||||||||
Toho Co. Ltd./Tokyo |
1,900 | 79,240 | ||||||
|
|
|||||||
Equity Real Estate Investment Trusts (REITs) — 2.4% | ||||||||
Daiwa House REIT Investment Corp. |
108 | 292,899 | ||||||
GLP J-Reit |
210 | 313,532 | ||||||
Japan Metropolitan Fund Invest |
350 | 283,270 | ||||||
Japan Real Estate Investment Corp. |
61 | 325,847 | ||||||
Nippon Building Fund Inc. |
73 | 418,313 | ||||||
Nippon Prologis REIT Inc. |
70 | 205,803 | ||||||
Nomura Real Estate Master Fund Inc. |
210 | 276,940 | ||||||
Orix JREIT Inc. |
140 | 195,863 | ||||||
|
|
|||||||
2,312,467 | ||||||||
Food & Staples Retailing — 2.0% | ||||||||
Seven & i Holdings Co. Ltd. |
38,500 | 1,873,322 | ||||||
|
|
|||||||
Food Products — 1.1% | ||||||||
Ajinomoto Co. Inc. |
10,500 | 305,980 | ||||||
MEIJI Holdings Co. Ltd. |
7,000 | 420,126 | ||||||
Nisshin Seifun Group Inc. |
10,500 | 149,037 | ||||||
Nissin Foods Holdings Co. Ltd. |
500 | 39,949 | ||||||
Toyo Suisan Kaisha Ltd. |
3,500 | 147,129 | ||||||
|
|
|||||||
1,062,221 | ||||||||
Gas Utilities — 0.7% | ||||||||
Osaka Gas Co. Ltd. |
17,500 | 320,272 | ||||||
Tokyo Gas Co. Ltd . |
17,500 | 356,446 | ||||||
|
|
|||||||
676,718 |
16 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI Japan Value ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
Health Care Providers & Services — 0.2% | ||||||||
Medipal Holdings Corp. |
10,500 | $ | 192,171 | |||||
|
|
|||||||
Household Durables — 2.3% | ||||||||
Iida Group Holdings Co. Ltd. |
7,000 | 129,914 | ||||||
Panasonic Corp. |
108,500 | 1,133,099 | ||||||
Sekisui Chemical Co. Ltd. |
17,500 | 286,579 | ||||||
Sekisui House Ltd. |
31,500 | 642,225 | ||||||
|
|
|||||||
2,191,817 | ||||||||
Household Products — 0.1% | ||||||||
Lion Corp. |
7,000 | 91,750 | ||||||
|
|
|||||||
Industrial Conglomerates — 2.5% | ||||||||
Hitachi Ltd. |
31,500 | 1,557,760 | ||||||
Toshiba Corp. |
19,300 | 769,487 | ||||||
|
|
|||||||
2,327,247 | ||||||||
Insurance — 5.0% | ||||||||
Dai-ichi Life Holdings Inc. |
49,000 | 1,017,639 | ||||||
Japan Post Holdings Co. Ltd. |
119,100 | 984,445 | ||||||
Japan Post Insurance Co. Ltd. |
10,500 | 179,327 | ||||||
MS&AD Insurance Group Holdings Inc. |
21,000 | 710,571 | ||||||
Sompo Holdings Inc. |
15,400 | 668,638 | ||||||
T&D Holdings Inc. |
24,600 | 357,277 | ||||||
Tokio Marine Holdings Inc. |
15,200 | 864,896 | ||||||
|
|
|||||||
4,782,793 | ||||||||
Interactive Media & Services — 0.3% | ||||||||
Z Holdings Corp. |
66,500 | 325,507 | ||||||
|
|
|||||||
Internet & Direct Marketing Retail — 0.1% | ||||||||
Rakuten Group Inc. |
14,000 | 119,009 | ||||||
|
|
|||||||
Machinery — 2.3% | ||||||||
Hino Motors Ltd. |
14,000 | 131,555 | ||||||
Hitachi Construction Machinery Co. Ltd. |
7,000 | 171,301 | ||||||
Hoshizaki Corp. |
1,000 | 69,721 | ||||||
Kubota Corp. |
31,500 | 565,163 | ||||||
Mitsubishi Heavy Industries Ltd. |
17,500 | 516,120 | ||||||
NGK Insulators Ltd. |
14,000 | 217,418 | ||||||
Toyota Industries Corp. |
7,000 | 532,428 | ||||||
|
|
|||||||
2,203,706 | ||||||||
Marine — 1.2% | ||||||||
Mitsui OSK Lines Ltd. |
5,500 | 446,832 | ||||||
Nippon Yusen KK |
7,000 | 655,837 | ||||||
|
|
|||||||
1,102,669 | ||||||||
Media — 0.5% | ||||||||
Dentsu Group Inc. |
10,500 | 418,952 | ||||||
Hakuhodo DY Holdings Inc. |
7,000 | 93,019 | ||||||
|
|
|||||||
511,971 | ||||||||
Metals & Mining — 1.9% | ||||||||
Hitachi Metals Ltd.(a) |
3,700 | 65,954 | ||||||
JFE Holdings Inc. |
24,500 | 364,745 | ||||||
Nippon Steel Corp. |
42,000 | 768,977 | ||||||
Sumitomo Metal Mining Co. Ltd. |
11,900 | 593,601 | ||||||
|
|
|||||||
1,793,277 | ||||||||
Multiline Retail — 0.2% | ||||||||
Ryohin Keikaku Co. Ltd. |
14,000 | 206,187 | ||||||
|
|
|||||||
Oil, Gas & Consumable Fuels — 1.5% | ||||||||
ENEOS Holdings Inc. |
150,500 | 595,949 | ||||||
Idemitsu Kosan Co. Ltd. |
10,592 | 283,935 |
Security | Shares | Value | ||||||
Oil, Gas & Consumable Fuels (continued) | ||||||||
Inpex Corp. |
49,000 | $ | 505,068 | |||||
|
|
|||||||
1,384,952 | ||||||||
Paper & Forest Products — 0.2% | ||||||||
Oji Holdings Corp. |
38,500 | 196,702 | ||||||
|
|
|||||||
Personal Products — 0.5% | ||||||||
Kao Corp. |
8,000 | 373,975 | ||||||
Pola Orbis Holdings Inc. |
3,500 | 55,135 | ||||||
|
|
|||||||
429,110 | ||||||||
Pharmaceuticals — 5.8% | ||||||||
Astellas Pharma Inc. |
91,000 | 1,518,264 | ||||||
Otsuka Holdings Co. Ltd. |
18,600 | 641,220 | ||||||
Santen Pharmaceutical Co. Ltd. |
17,500 | 199,449 | ||||||
Shionogi & Co. Ltd. |
8,200 | 545,237 | ||||||
Sumitomo Dainippon Pharma Co. Ltd. |
10,500 | 115,234 | ||||||
Taisho Pharmaceutical Holdings Co. Ltd. |
1,900 | 94,317 | ||||||
Takeda Pharmaceutical Co. Ltd. |
77,000 | 2,347,753 | ||||||
|
|
|||||||
5,461,474 | ||||||||
Real Estate Management & Development — 4.0% | ||||||||
Daito Trust Construction Co. Ltd. |
3,500 | 387,239 | ||||||
Daiwa House Industry Co. Ltd. |
28,000 | 794,088 | ||||||
Hulic Co. Ltd. |
10,500 | 95,656 | ||||||
Mitsubishi Estate Co. Ltd. |
59,500 | 908,462 | ||||||
Mitsui Fudosan Co. Ltd. |
45,500 | 1,012,650 | ||||||
Nomura Real Estate Holdings Inc. |
7,000 | 174,290 | ||||||
Sumitomo Realty & Development Co. Ltd. |
14,000 | 411,857 | ||||||
|
|
|||||||
3,784,242 | ||||||||
Road & Rail — 3.6% | ||||||||
Central Japan Railway Co. |
7,000 | 945,814 | ||||||
East Japan Railway Co |
14,800 | 879,249 | ||||||
Hankyu Hanshin Holdings Inc. |
10,500 | 314,129 | ||||||
Keio Corp. |
3,500 | 143,210 | ||||||
Keisei Electric Railway Co. Ltd. |
3,500 | 98,020 | ||||||
Kintetsu Group Holdings Co. Ltd.(a) |
3,500 | 105,148 | ||||||
Nippon Express Holdings Inc. |
3,500 | 212,169 | ||||||
Odakyu Electric Railway Co. Ltd. |
7,200 | 118,789 | ||||||
Tokyu Corp. |
10,500 | 140,032 | ||||||
West Japan Railway Co. |
10,700 | 461,640 | ||||||
|
|
|||||||
3,418,200 | ||||||||
Semiconductors & Semiconductor Equipment — 0.1% | ||||||||
Rohm Co. Ltd. |
1,100 | 87,729 | ||||||
|
|
|||||||
Software — 0.2% | ||||||||
Trend Micro Inc/Japan |
3,500 | 195,533 | ||||||
|
|
|||||||
Specialty Retail — 0.2% | ||||||||
USS Co. Ltd. |
10,500 | 174,427 | ||||||
|
|
|||||||
Technology Hardware, Storage & Peripherals — 2.5% | ||||||||
Brother Industries Ltd. |
10,500 | 191,109 | ||||||
Canon Inc. |
49,000 | 1,153,114 | ||||||
FUJIFILM Holdings Corp. |
11,400 | 724,631 | ||||||
Ricoh Co. Ltd. |
10,500 | 89,574 | ||||||
Seiko Epson Corp. |
14,000 | 215,326 | ||||||
|
|
|||||||
2,373,754 | ||||||||
Tobacco — 1.2% | ||||||||
Japan Tobacco Inc. |
59,500 | 1,094,274 | ||||||
|
|
|||||||
Trading Companies & Distributors — 6.8% | ||||||||
ITOCHU Corp. |
28,000 | 912,481 |
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) February 28, 2022 |
iShares® MSCI Japan Value ETF (Percentages shown are based on Net Assets) |
Security | Shares | Value | ||||||
|
||||||||
Trading Companies & Distributors (continued) | ||||||||
Marubeni Corp. |
77,000 | $ | 808,241 | |||||
Mitsubishi Corp. |
63,000 | 2,118,292 | ||||||
Mitsui & Co. Ltd. |
49,000 | 1,221,702 | ||||||
Sumitomo Corp. |
56,000 | 913,674 | ||||||
Toyota Tsusho Corp. |
10,500 | 435,907 | ||||||
|
|
|||||||
6,410,297 | ||||||||
Wireless Telecommunication Services — 7.4% | ||||||||
KDDI Corp. |
80,500 | 2,619,570 | ||||||
SoftBank Corp. |
140,100 | 1,770,077 | ||||||
SoftBank Group Corp. |
59,500 | 2,670,121 | ||||||
|
|
|||||||
7,059,768 | ||||||||
|
|
|||||||
Total
Common Stocks — 99.7% |
94,617,624 | |||||||
|
|
|||||||
Short-Term Investments |
||||||||
Money Market Funds — 0.0% | ||||||||
BlackRock Cash Funds: Treasury, SL Agency Shares, 0.03%(b)(c) |
20,000 | 20,000 | ||||||
|
|
|||||||
Total
Short-Term Investments — 0.0% |
20,000 | |||||||
|
|
|||||||
Total
Investments in Securities — 99.7% |
94,637,624 | |||||||
Other Assets, Less Liabilities — 0.3% |
296,664 | |||||||
|
|
|||||||
Net Assets — 100.0% |
$ | 94,934,288 | ||||||
|
|
(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 February 28, 2022 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:
|
||||||||||||||||||||||||||||||||||||||||
Affiliated Issuer | Value
at 08/31/21 |
Purchases at Cost |
Proceeds from Sales |
Net Realized Gain (Loss) |
Change
in Unrealized Appreciation (Depreciation) |
Value
at 02/28/22 |
Shares Held at 02/28/22 |
Income |
Capital Gain |
|||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
BlackRock Cash Funds: Treasury, SL Agency Shares |
$ | — | $ | 20,000 | (a) | $ | — | $ | — | $ | — | $ | 20,000 | 20,000 | $ | 2 | $ | — | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
(a) |
Represents net amount purchased (sold). |
Derivative Financial Instruments Outstanding as of Period End
Futures Contracts
|
||||||||||||||||
Description |
Number of Contracts |
Expiration Date |
Notional Amount (000) |
Value/ Unrealized Appreciation (Depreciation) |
||||||||||||
|
||||||||||||||||
Long Contracts |
||||||||||||||||
Mini TOPIX Index |
20 | 03/10/22 | $ | 329 | $ | (11,652 | ) | |||||||||
|
|
18 |
2 0 2 2 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) February 28, 2022 |
iShares® MSCI Japan Value ETF |
Derivative Financial Instruments Categorized by Risk Exposure
As of period end, 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) |
$ | 11,652 | ||
|
|
(a) |
Net cumulative unrealized 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 period ended February 28, 2022, the effect of derivative financial instruments in the Statements of Operations was as follows:
|
||||
Equity Contracts |
||||
|
||||
Net Realized Gain (Loss) from: |
||||
Futures contracts |
$ | (1,961 | ) | |
|
|
|||
Net Change in Unrealized Appreciation (Depreciation) on: |
||||
Futures contracts |
$ | (13,085 | ) | |
|
|
Average Quarterly Balances of Outstanding Derivative Financial Instruments
|
||||
Futures contracts: |
||||
Average notional value of contracts — long |
$ | 456,718 | ||
|
For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.
Fair Value Hierarchy as of Period End
Various inputs are used in determining the fair value of financial instruments. For a 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 Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.
|
||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
||||||||||||||||
Investments |
||||||||||||||||
Assets |
||||||||||||||||
Common Stocks |
$ | — | $ | 94,617,624 | $ | — | $ | 94,617,624 | ||||||||
Money Market Funds |
20,000 | — | — | 20,000 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 20,000 | $ | 94,617,624 | $ | — | $ | 94,637,624 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Derivative financial instruments(a) |
||||||||||||||||
Liabilities |
||||||||||||||||
Futures Contracts |
$ | — | $ | (11,652 | ) | $ | — | $ | (11,652 | ) | ||||||
|
|
|
|
|
|
|
|
(a) |
Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument. |
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 |
Statements of Assets and Liabilities (unaudited)
February 28, 2022
iShares MSCI China Multisector Tech ETF |
iShares MSCI Japan Equal Weighted ETF |
iShares MSCI Japan Value ETF |
||||||||||||||||||
ASSETS |
||||||||||||||||||||
Investments in securities, at value: |
||||||||||||||||||||
Unaffiliated(a) |
$ | 9,356,091 | $ | 7,109,843 | $ | 94,617,624 | ||||||||||||||
Affiliated(b) |
10,000 | — | 20,000 | |||||||||||||||||
Cash |
5,356 | 866 | 7,247 | |||||||||||||||||
Foreign currency, at value(c) |
151,399 | 5,673 | 178,391 | |||||||||||||||||
Foreign currency collateral pledged: |
||||||||||||||||||||
Futures contracts(d) |
— | 796 | 14,280 | |||||||||||||||||
Receivables: |
||||||||||||||||||||
Investments sold |
322,499 | 390,879 | 526,906 | |||||||||||||||||
Variation margin on futures contracts |
— | 320 | 6,096 | |||||||||||||||||
Dividends |
621 | 15,857 | 186,346 | |||||||||||||||||
Tax reclaims |
— | 743 | 171 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Total assets |
9,845,966 | 7,524,977 | 95,557,061 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
LIABILITIES |
||||||||||||||||||||
Payables: |
||||||||||||||||||||
Investments purchased |
485,023 | 402,171 | 612,258 | |||||||||||||||||
Investment advisory fees |
4,367 | 826 | 10,515 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Total liabilities |
489,390 | 402,997 | 622,773 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
NET ASSETS |
$ | 9,356,576 | $ | 7,121,980 | $ | 94,934,288 | ||||||||||||||
|
|
|
|
|
|
|||||||||||||||
NET ASSETS CONSIST OF: |
||||||||||||||||||||
Paid-in capital |
$ | 9,892,974 | $ | 7,211,200 | $ | 96,403,304 | ||||||||||||||
Accumulated loss |
(536,398 | ) | (89,220 | ) | (1,469,016 | ) | ||||||||||||||
|
|
|
|
|
|
|||||||||||||||
NET ASSETS |
$ | 9,356,576 | $ | 7,121,980 | $ | 94,934,288 | ||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Shares outstanding |
400,000 | 200,000 | 3,500,000 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Net asset value |
$ | 23.39 | $ | 35.61 | $ | 27.12 | ||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Shares authorized |
Unlimited | Unlimited | Unlimited | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Par value |
None | None | None | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
(a) Investments, at cost — Unaffiliated |
$ | 9,860,046 | $ | 6,915,422 | $ | 94,617,391 | ||||||||||||||
(b) Investments, at cost — Affiliated |
$ | 10,000 | $ | — | $ | 20,000 | ||||||||||||||
(c) Foreign currency, at cost |
$ | 151,559 | $ | 5,675 | $ | 177,804 | ||||||||||||||
(d) Foreign currency collateral pledged, at cost |
$ | — | $ | 798 | $ | 14,244 |
See notes to financial statements.
20 |
2 0 2 2 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 February 28, 2022
|
iShares MSCI China |
|
|
iShares MSCI Japan Equal ETF |
|
|
iShares MSCI Japan |
| ||||
|
||||||||||||
INVESTMENT INCOME |
||||||||||||
Dividends — Unaffiliated |
$ | 620 | $ | 81,545 | $ | 808,982 | ||||||
Dividends — Affiliated |
— | — | 2 | |||||||||
Foreign taxes withheld |
— | (8,143 | ) | (80,790 | ) | |||||||
|
|
|
|
|
|
|||||||
Total investment income |
620 | 73,402 | 728,194 | |||||||||
|
|
|
|
|
|
|||||||
EXPENSES |
||||||||||||
Investment advisory fees |
5,298 | 5,700 | 54,467 | |||||||||
|
|
|
|
|
|
|||||||
Total expenses |
5,298 | 5,700 | 54,467 | |||||||||
|
|
|
|
|
|
|||||||
Net investment income (loss) |
(4,678 | ) | 67,702 | 673,727 | ||||||||
|
|
|
|
|
|
|||||||
REALIZED AND UNREALIZED GAIN (LOSS) |
||||||||||||
Net realized gain (loss) from: |
||||||||||||
Investments — Unaffiliated |
(27,592 | ) | (16,413 | ) | (362,164 | ) | ||||||
Futures contracts |
— | 82 | (1,961 | ) | ||||||||
Foreign currency transactions |
7 | (1,025 | ) | (16,551 | ) | |||||||
|
|
|
|
|
|
|||||||
Net realized loss |
(27,585 | ) | (17,356 | ) | (380,676 | ) | ||||||
|
|
|
|
|
|
|||||||
Net change in unrealized appreciation (depreciation) on: |
||||||||||||
Investments — Unaffiliated |
(503,955 | ) | (690,458 | ) | (1,628,292 | ) | ||||||
Futures contracts |
— | (953 | ) | (13,085 | ) | |||||||
Foreign currency translations |
(180 | ) | 15 | 760 | ||||||||
|
|
|
|
|
|
|||||||
Net change in unrealized appreciation (depreciation) |
(504,135 | ) | (691,396 | ) | (1,640,617 | ) | ||||||
|
|
|
|
|
|
|||||||
Net realized and unrealized loss |
(531,720 | ) | (708,752 | ) | (2,021,293 | ) | ||||||
|
|
|
|
|
|
|||||||
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | (536,398 | ) | $ | (641,050 | ) | $ | (1,347,566 | ) | |||
|
|
|
|
|
|
(a) For the period from January 25, 2022 (commencement of operations) to February 28, 2022.
See notes to financial statements.
F I N A N C I A L S T A T E M E N T S |
21 |
Statements of Changes in Net Assets
iShares MSCI China Multisector Tech ETF |
iShares MSCI Japan Equal Weighted ETF |
|||||||||||||||
Period From 01/25/22(a) to
02/28/22 |
Six
Months Ended 02/28/22 (unaudited) |
Year Ended 08/31/21 |
||||||||||||||
| ||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS |
||||||||||||||||
OPERATIONS |
||||||||||||||||
Net investment income (loss) |
$ | (4,678 | ) | $ | 67,702 | $ | 134,256 | |||||||||
Net realized loss |
(27,585 | ) | (17,356 | ) | (163,375 | ) | ||||||||||
Net change in unrealized appreciation (depreciation) |
(504,135 | ) | (691,396 | ) | 1,181,460 | |||||||||||
|
|
|
|
|
|
|||||||||||
Net increase (decrease) in net assets resulting from operations |
(536,398 | ) | (641,050 | ) | 1,152,341 | |||||||||||
|
|
|
|
|
|
|||||||||||
DISTRIBUTIONS TO SHAREHOLDERS(b) |
||||||||||||||||
Decrease in net assets resulting from distributions to shareholders |
— | (131,155 | ) | (116,528 | ) | |||||||||||
|
|
|
|
|
|
|||||||||||
CAPITAL SHARE TRANSACTIONS |
||||||||||||||||
Net increase in net assets derived from capital share transactions |
9,892,974 | — | — | |||||||||||||
|
|
|
|
|
|
|||||||||||
NET ASSETS |
||||||||||||||||
Total increase (decrease) in net assets |
9,356,576 | (772,205 | ) | 1,035,813 | ||||||||||||
Beginning of period |
— | 7,894,185 | 6,858,372 | |||||||||||||
|
|
|
|
|
|
|||||||||||
End of period |
$ | 9,356,576 | $ | 7,121,980 | $ | 7,894,185 | ||||||||||
|
|
|
|
|
|
(a) |
Commencement of operations. |
(b) |
Distributions for annual periods determined in accordance with U.S. federal income tax regulations. |
See notes to financial statements.
22 |
2 0 2 2 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)
iShares MSCI Japan Value ETF |
||||||||
Six
Months Ended 02/28/22 (unaudited) |
Year Ended 08/31/21 |
|||||||
| ||||||||
INCREASE (DECREASE) IN NET ASSETS |
||||||||
OPERATIONS |
||||||||
Net investment income |
$ | 673,727 | $ | 607,492 | ||||
Net realized loss |
(380,676 | ) | (111,985 | ) | ||||
Net change in unrealized appreciation (depreciation) |
(1,640,617 | ) | 1,980,603 | |||||
|
|
|
|
|||||
Net increase (decrease) in net assets resulting from operations |
(1,347,566 | ) | 2,476,110 | |||||
|
|
|
|
|||||
DISTRIBUTIONS TO SHAREHOLDERS(a) |
||||||||
Decrease in net assets resulting from distributions to shareholders |
(1,096,497 | ) | (537,816 | ) | ||||
|
|
|
|
|||||
CAPITAL SHARE TRANSACTIONS |
||||||||
Net increase in net assets derived from capital share transactions |
53,017,656 | 35,457,668 | ||||||
|
|
|
|
|||||
NET ASSETS |
||||||||
Total increase in net assets |
50,573,593 | 37,395,962 | ||||||
Beginning of period |
44,360,695 | 6,964,733 | ||||||
|
|
|
|
|||||
End of period |
$ | 94,934,288 | $ | 44,360,695 | ||||
|
|
|
|
(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 |
23 |
(For a share outstanding throughout the period)
iShares MSCI China |
||||
|
Period From 01/25/22 to 02/28/22 |
(a)
| ||
|
||||
Net asset value, beginning of period |
$ | 24.81 | ||
|
|
|||
Net investment loss(b) |
(0.01 | ) | ||
Net realized and unrealized loss(c) |
(1.41 | ) | ||
|
|
|||
Net decrease from investment operations |
(1.42 | ) | ||
|
|
|||
Net asset value, end of period |
$ | 23.39 | ||
|
|
|||
Total Return(d) |
||||
Based on net asset value |
(5.71 | )%(e) | ||
|
|
|||
Ratios to Average Net Assets(f) |
||||
Total expenses |
0.59 | %(g) | ||
|
|
|||
Net investment loss |
(0.52 | )%(g) | ||
|
|
|||
Supplemental Data |
||||
Net assets, end of period (000) |
$ | 9,357 | ||
|
|
|||
Portfolio turnover rate(h) |
5 | %(e) | ||
|
|
(a) |
Commencement of operations. |
(b) |
Based on average shares outstanding. |
(c) |
The amount 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) |
Where applicable, assumes the reinvestment of distributions. |
(e) |
Not annualized. |
(f) |
Excludes fees and expenses incurred indirectly as a result of investments in underlying funds. |
(g) |
Annualized. |
(h) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
24 |
2 0 2 2 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 Japan Equal Weighted ETF | ||||||||||||||||||||||||
|
|
|||||||||||||||||||||||
|
Six Months Ended 02/28/22 (unaudited) |
|
|
Year Ended 08/31/21 |
|
|
Year Ended 08/31/20 |
|
|
Period From 03/05/19 to 08/31/19 |
(a)
| |||||||||||||
|
||||||||||||||||||||||||
Net asset value, beginning of period |
$ | 39.47 | $ | 34.29 | $ | 32.59 | $ | 33.43 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Net investment income(b) |
0.34 | 0.67 | 0.66 | 0.44 | ||||||||||||||||||||
Net realized and unrealized gain (loss)(c) |
(3.54 | ) | 5.09 | 1.95 | (0.82 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Net increase (decrease) from investment operations |
(3.20 | ) | 5.76 | 2.61 | (0.38 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Distributions(d) |
||||||||||||||||||||||||
From net investment income |
(0.66 | ) | (0.58 | ) | (0.91 | ) | (0.46 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total distributions |
(0.66 | ) | (0.58 | ) | (0.91 | ) | (0.46 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Net asset value, end of period |
$ | 35.61 | $ | 39.47 | $ | 34.29 | $ | 32.59 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Return(e) |
||||||||||||||||||||||||
Based on net asset value |
(8.24 | )%(f) | 16.83 | % | 7.98 | % | (1.14 | )%(f) | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Ratios to Average Net Assets(g) |
||||||||||||||||||||||||
Total expenses |
0.15 | %(h) | 0.15 | % | 0.15 | % | 0.15 | %(h) | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Net investment income |
1.78 | %(h) | 1.75 | % | 1.98 | % | 2.68 | %(h) | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Supplemental Data |
||||||||||||||||||||||||
Net assets, end of period (000) |
$ | 7,122 | $ | 7,894 | $ | 6,858 | $ | 6,519 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Portfolio turnover rate(i) |
15 | %(f) | 25 | % | 17 | % | 6 | %(f) | ||||||||||||||||
|
|
|
|
|
|
|
|
(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) |
Where applicable, assumes the reinvestment of distributions. |
(f) |
Not annualized. |
(g) |
Excludes fees and expenses incurred indirectly as a result of investments in underlying funds. |
(h) |
Annualized. |
(i) |
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 |
25 |
Financial Highlights (continued)
(For a share outstanding throughout each period)
iShares MSCI Japan Value ETF | ||||||||||||||||
|
|
|||||||||||||||
|
Six Months Ended 02/28/22 (unaudited) |
|
|
Year Ended 08/31/21 |
|
|
Year Ended 08/31/20 |
|
|
Period From 03/05/19 to 08/31/19 |
(a)
| |||||
|
||||||||||||||||
Net asset value, beginning of period. |
$ | 27.73 | $ | 23.22 | $ | 23.70 | $ | 24.67 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net investment income(b) |
0.26 | 0.65 | 0.71 | 0.46 | ||||||||||||
Net realized and unrealized gain (loss)(c) |
(0.48 | ) | 4.36 | (0.26 | ) | (0.97 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase (decrease) from investment operations |
(0.22 | ) | 5.01 | 0.45 | (0.51 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Distributions(d) |
||||||||||||||||
From net investment income |
(0.39 | ) | (0.50 | ) | (0.93 | ) | (0.46 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total distributions |
(0.39 | ) | (0.50 | ) | (0.93 | ) | (0.46 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net asset value, end of period |
$ | 27.12 | $ | 27.73 | $ | 23.22 | $ | 23.70 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Return(e) |
||||||||||||||||
Based on net asset value |
(0.74 | )%(f) | 21.62 | % | 1.71 | % | (2.10 | )%(f) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Ratios to Average Net Assets(g) |
||||||||||||||||
Total expenses |
0.15 | %(h) | 0.15 | % | 0.15 | % | 0.15 | %(h) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net investment income |
1.86 | %(h) | 2.39 | % | 2.98 | % | 3.83 | %(h) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Supplemental Data |
||||||||||||||||
Net assets, end of period (000) |
$ | 94,934 | $ | 44,361 | $ | 6,965 | $ | 7,111 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Portfolio turnover rate(i) |
10 | %(f) | 24 | % | 35 | % | 9 | %(f) | ||||||||
|
|
|
|
|
|
|
|
(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) |
Where applicable, assumes the reinvestment of distributions. |
(f) |
Not annualized. |
(g) |
Excludes fees and expenses incurred indirectly as a result of investments in underlying funds. |
(h) |
Annualized. |
(i) |
Portfolio turnover rate excludes in-kind transactions. |
See notes to financial statements.
26 |
2 0 2 2 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 | |
MSCI China Multisector Tech(a) |
Non-diversified | |
MSCI Japan Equal Weighted(b) |
Diversified | |
MSCI Japan Value(b) |
Diversified |
(a) |
The Fund commenced operation on January 25, 2022. |
(b) |
The Fund’s classification changed from non-diversified to diversified during the reporting period. |
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. 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 Statements 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 Statements 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 February 28, 2022, if any, are disclosed in the Statements of Assets and Liabilities.
The Funds file withholding tax reclaims in certain jurisdictions to recover a portion of amounts previously withheld. The Funds may record a reclaim receivable based on collectability, which includes factors such as the jurisdiction’s applicable laws, payment history and market convention. The Statements of Operations includes tax reclaims recorded as well as professional and other fees, if any, associated with recovery of foreign withholding taxes.
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 record 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.
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 |
27 |
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. Each Fund determines the fair values 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 or trade price on the exchange where the contract is traded. |
Generally, trading in foreign instruments is substantially completed each day at various times prior to the close of trading on the New York Stock Exchange (“NYSE”). Each business day, the Funds use current market factors supplied by independent pricing services to value certain foreign instruments (“Systematic Fair Value Price”). The Systematic Fair Value Price is designed to value such foreign securities at fair value as of the close of trading on the NYSE, which follows the close of the local markets.
If events (e.g., 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 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 judgment 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.
28 |
2 0 2 2 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)
4. |
DERIVATIVE FINANCIAL INSTRUMENTS |
Futures Contracts: 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 Statements 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 Statements 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 Statements of Assets and Liabilities. When the contract is closed, a realized gain or loss is recorded in the Statements 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 rates, foreign currency exchange rates or underlying assets.
5. |
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 Fund, based on the average daily net assets of each Fund as follows:
iShares ETF | Investment Advisory Fee | |||
MSCI China Multisector Tech |
0.59 | % | ||
MSCI Japan Equal Weighted |
0.15 | |||
MSCI Japan Value |
0.15 |
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.
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 February 28, 2022, 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) | |||
MSCI Japan Value |
$3,841,038 | $3,175,545 | $(137,429) |
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 Statements 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.
6. |
PURCHASES AND SALES |
For the six months ended February 28, 2022, purchases and sales of investments, excluding short-term investments and in-kind transactions, were as follows:
iShares ETF | Purchases | Sales | ||
MSCI China Multisector Tech |
$8,515,083 | $ 473,092 | ||
MSCI Japan Equal Weighted |
1,107,091 | 1,159,303 | ||
MSCI Japan Value |
8,169,181 | 7,441,607 |
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 |
29 |
Notes to Financial Statements (unaudited) (continued)
For the six months ended February 28, 2022, in-kind transactions were as follows:
iShares ETF | In-kind Purchases |
In-kind Sales |
||||||
MSCI China Multisector Tech |
$ | 1,845,647 | $ | — | ||||
MSCI Japan Value |
51,633,834 | — |
7. |
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 February 28, 2022, 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 August 31, 2021, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:
iShares ETF | Non-Expiring | |||
MSCI Japan Equal Weighted |
$ | 161,727 | ||
MSCI Japan Value |
424,703 |
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 February 28, 2022, 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) |
||||||||||||
MSCI China Multisector Tech |
$ | 9,870,046 | $ | 170,164 | $ | (674,119 | ) | $ | (503,955 | ) | ||||||
MSCI Japan Equal Weighted |
7,016,176 | 699,337 | (606,560 | ) | 92,777 | |||||||||||
MSCI Japan Value |
95,201,605 | 4,059,641 | (4,635,274 | ) | (575,633 | ) |
8. |
LINE OF CREDIT |
The iShares MSCI China Multisector Tech ETF, along with certain other iShares funds (“Participating Funds”), is a party to a $800 million credit agreement (“Syndicated Credit Agreement”) with a group of lenders, which expires on August 12, 2022. 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 Funds may borrow up to the aggregate commitment amount subject to asset coverage and other limitations as specified in the Syndicated Credit Agreement. The Syndicated Credit Agreement has the following terms: a commitment fee of 0.15% 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 Syndicated Credit Agreement.
During the six months ended February 28, 2022, the Fund did not borrow under the Syndicated Credit Agreement.
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.
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Notes to Financial Statements (unaudited) (continued) |
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. Although vaccines have been developed and approved for use by various governments, 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 Statements 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.
The 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. Unanticipated or sudden political or social developments may cause uncertainty in the markets and as a result adversely affect the Fund’s investments. 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.
The Funds invest a significant portion of their assets in securities of issuers located in China or with significant exposure to Chinese issuers or countries. Investments in Chinese securities, including certain Hong Kong-listed securities, involves risks specific to China. China may be subject to considerable degrees of economic, political and social instability and demonstrates significantly higher volatility from time to time in comparison to developed markets. Chinese markets generally continue to experience inefficiency, volatility and pricing anomalies resulting from governmental influence, a lack of publicly available information and/or political and social instability. Internal social unrest or confrontations with other neighboring countries may disrupt economic development in China and result in a greater risk of currency fluctuations, currency non-convertibility, interest rate fluctuations and higher rates of inflation. Incidents involving China’s or the region’s security may cause uncertainty in Chinese markets and may adversely affect the Chinese economy and a fund’s investments. Reduction in spending on Chinese products and services, institution of tariffs or other trade barriers, or a downturn in any of the economies of China’s key trading partners may have an adverse impact on the Chinese economy. In addition, measures may be taken to limit the flow of capital and/or sanctions may be imposed, which could prohibit or restrict the ability to own or transfer fund assets and may also include retaliatory actions, such as seizure of fund assets.
The 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.
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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Notes to Financial Statements (unaudited) (continued)
The 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.
Significant Shareholder Redemption Risk: Certain shareholders may own or manage a substantial amount of fund shares and/or hold their fund investments for a limited period of time. Large redemptions of fund shares by these shareholders may force a Fund to sell portfolio securities, which may negatively impact the fund’s NAV, increase the fund’s brokerage costs, and/or accelerate the realization of taxable income/gains and cause the fund to make additional taxable distributions to shareholders.
LIBORTransition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”). Although many LIBOR rates ceased to be published or no longer are representative of the underlying market they seek to measure after December 31, 2021, a selection of widely used USD LIBOR rates will continue to be published through June 2023 in order to assist with the transition. 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:
Period Ended 02/28/22 | ||||||||
iShares ETF | Shares | Amount | ||||||
MSCI China Multisector Tech |
||||||||
Shares sold |
400,000 | $ | 9,892,974 | |||||
|
|
|
|
Six Months Ended
02/28/22 |
Year Ended
08/31/21 |
|||||||||||||||
iShares ETF | Shares | Amount | Shares | Amount | ||||||||||||
MSCI Japan Value |
||||||||||||||||
Shares sold |
1,900,000 | $ | 53,017,656 | 1,400,000 | $ | 37,929,376 | ||||||||||
Shares redeemed |
— | — | (100,000 | ) | (2,471,708 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase |
1,900,000 | $ | 53,017,656 | 1,300,000 | $ | 35,457,668 | ||||||||||
|
|
|
|
|
|
|
|
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 Statements of Assets and Liabilities.
11. |
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.
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Board Review and Approval of Investment Advisory Contract
iShares MSCI China Multisector Tech 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 Trustees who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members”), is required to consider and approve the proposed Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) on behalf of the Fund. The Independent Trustees requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the terms of the proposed Advisory Contract. At a meeting held on September 29 – October 1, 2021, the Board, including the Independent Board Members, approved the selection of BFA as investment adviser and approved the proposed Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA. The Board also considered information previously provided by BFA, BlackRock Institutional Trust Company, N.A. (“BTC”), and BlackRock, Inc. (“BlackRock”), as applicable, at prior Board meetings. 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 Advisory Contract for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses of the Fund; (ii) the nature, extent and quality of the services to be provided by BFA; (iii) the costs of services to be provided to the Fund and the availability of information related to profits to be 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, no one of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the Advisory Contract are discussed below.
Expenses 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 of the Fund in comparison with the same information for other ETFs, 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 further 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 any waivers and reimbursements) for the Fund were lower than the median of the overall fund expenses (net of any waivers and reimbursements) of the funds in its Peer Group, excluding iShares funds.
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 of the Fund supported the Board’s approval of the Advisory Contract.
Nature, Extent and Quality of Services: The Board reviewed the scope of services to be provided by BFA under the Advisory Contract. 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 and have made significant investments into the iShares business to support the iShares funds and their shareholders. The Board considered representations by BFA, BTC, and BlackRock that the scope and quality of services to be provided to the Fund would be similar to the scope and quality of services provided to other iShares funds. The Board also considered BFA’s compliance program and its compliance record with respect to other iShares funds. 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 relevant, and has provided information and made appropriate 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 who will be responsible for the day-to-day management of the Fund, as well as the resources that will be available to them in managing the Fund. The Board also considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies, which were provided throughout the year with respect to other iShares funds.
Based on review of this information, the Board concluded that the nature, extent and quality of services to be provided to the Fund under the Advisory Contract supported the Board’s approval of the Advisory Contract.
Costs of Services to be Provided to the Fund and Profits to be Realized by BFA and Affiliates: The Board did not consider the profitability of the Fund to BFA based on the fees payable under the Advisory Contract or revenue to be received by BFA or its affiliates in connection with services to be provided to the Fund since the proposed relationship had not yet commenced. The Board noted that it expects to receive profitability information from BFA periodically following the Fund’s launch and will thus be in a position to evaluate whether any new or additional breakpoints or other adjustments in Fund fees would be appropriate.
Economies of Scale: The Board considered information that it had previously received regarding economies of scale, efficiencies and scale benefits shared with the iShares funds through relatively low fee rates established at inception, breakpoints and 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 any breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board noted that it would continue to assess the appropriateness of adding breakpoints in the future.
This consideration 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 Advisory Contract.
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”), and acknowledged BFA’s assertion 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 previously provided the Board with detailed information regarding how the Other Accounts (particularly institutional clients) generally differ from 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 |
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Board Review and Approval of Investment Advisory Contract (continued)
funds, including in terms of the different and generally more extensive services provided to the iShares funds, 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 considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement.
Other Benefits to BFA and/or its Affiliates: Except as noted below, the Board did not consider the “fallout” benefits or ancillary revenue to be received by BFA and/or its affiliates in connection with the services to be provided to the Fund by BFA since the proposed relationship had not yet commenced. However, 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 considered the potential payment of advisory fees and/or administration 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 and/or administration services. The Board also noted the potential revenue to be received by BFA and/or its affiliates pursuant to an agreement that would permit 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 also considered the potential for revenue to BTC, the Fund’s securities lending agent, and its affiliates in the event of any loaning of portfolio securities of 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), will be 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 Advisory Contract.
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 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 to be rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the Advisory Contract.
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Statement Regarding Liquidity Risk Management Program (unaudited)
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), iShares Trust (the “Trust”) has adopted and implemented a liquidity risk management program (the “Program”) for iShares MSCI Japan Equal Weighted ETF and iShares MSCI Japan Value ETF (the “Funds” or “ETFs”), each a series of the Trust, which is reasonably designed to assess and manage each Fund’s liquidity risk.
The Board of Trustees (the “Board”) of the Trust, on behalf of the Funds, met on December 9, 2021 (the “Meeting”) to review the Program. The Board previously appointed BlackRock Fund Advisors (“BlackRock”), the investment adviser to the Funds, as the program administrator for each Fund’s Program. BlackRock also previously delegated oversight of the Program to the 40 Act Liquidity Risk Management Committee (the “Committee”). At the Meeting, the Committee, on behalf of BlackRock, provided the Board with a report that addressed the operation of the Program and assessed its adequacy and effectiveness of implementation, including the management of each Fund’s Highly Liquid Investment Minimum (“HLIM”) where applicable, and any material changes to the Program (the “Report”). The Report covered the period from October 1, 2020 through September 30, 2021 (the “Program Reporting Period”).
The Report described the Program’s liquidity classification methodology for categorizing each Fund’s investments (including derivative transactions) into one of four liquidity buckets. It also referenced the methodology used by BlackRock to establish each Fund’s HLIM and noted that the Committee reviews and ratifies the HLIM assigned to each Fund no less frequently than annually. The Report also discussed notable events affecting liquidity over the Program Reporting Period, including extended market holidays and the imposition of capital controls in certain non-U.S. countries.
The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing each Fund’s liquidity risk, as follows:
a) |
The Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions. During the Program Reporting Period, the Committee reviewed whether each Fund’s strategy is appropriate for an open-end fund structure, with a focus on funds with more significant and consistent holdings of less liquid and illiquid assets. The Committee also factored a fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account. Derivative exposure was also considered in the calculation of a fund’s liquidity bucketing. Finally, a factor for consideration under the Liquidity Rule is a Fund’s use of borrowings for investment purposes. However, the Funds do not borrow for investment purposes. |
b) |
Short-term and long-term cash flow projections during both normal and reasonably foreseeable stressed conditions. During the Program Reporting Period, the Committee reviewed historical redemption activity and used this information as a component to establish each ETF’s reasonably anticipated trading size (“RATS”). The Committee may also take into consideration a fund’s shareholder ownership concentration (which, depending on product type and distribution channel, may or may not be available), a fund’s distribution channels, and the degree of certainty associated with a fund’s short-term and long-term cash flow projections. |
c) |
Holdings of cash and cash equivalents, as well as borrowing arrangements. The Committee considered that ETFs generally do not hold more than de minimis amounts of cash. While the ETFs generally do not engage in borrowing, certain of the ETFs have the flexibility to draw on a line of credit to meet redemption requests or facilitate settlements. |
d) |
The relationship between an ETF’s portfolio liquidity and the way in which, and the prices and spreads at which, ETF shares trade, including the efficiency of the arbitrage function and the level of active participation by market participants, including authorized participants. The Committee monitored the prevailing bid/ask spread and the ETF price premium (or discount) to NAV for all ETFs and reviewed any persistent deviations from long-term averages. |
e) |
The effect of the composition of baskets on the overall liquidity of an ETF’s portfolio. In reviewing the linkage between the composition of custom baskets accepted by an ETF and any significant change in the liquidity profile of such ETF, the Committee reviewed changes in the proportion of each ETF’s portfolio comprised of less liquid and illiquid holdings to determine if applicable thresholds were met requiring enhanced review. |
As part of BlackRock’s continuous review of the effectiveness of the Program, the Committee made the following material changes to the Program: (1) updates to certain model components in the Program’s methodology; and (2) certain iShares Funds entered into a $800 million credit agreement with a group of lenders that replaced a previous liquidity facility. The Report provided to the Board stated that the Committee concluded that based on the operation of the functions, as described in the Report, the Program is operating as intended and is effective in implementing the requirements of the Liquidity Rule.
S T A T E M E N T R E G A R D I N G L I Q U I D I T Y R I S K M A N A G E M E N T P R O G R A M |
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Supplemental Information (unaudited)
Regulation Regarding Derivatives
On October 28, 2020, the Securities and Exchange Commission (the “SEC”) adopted regulations governing the use of derivatives by registered investment companies (“Rule 18f-4”). The Funds will be required to implement and comply with Rule 18f-4 by August 19, 2022. Once implemented, Rule 18f-4 will impose limits on the amount of derivatives a fund can enter into, eliminate the asset segregation framework currently used by funds to comply with Section 18 of the 1940 Act, treat derivatives as senior securities and require funds whose use of derivatives is more than a limited specified exposure amount to establish and maintain a comprehensive derivatives risk management program and appoint a derivatives risk manager.
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.
February 28, 2022
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 |
||||||||||||||||||||||||
MSCI Japan Equal Weighted(a) |
$ | 0.570443 | $ | — | $ | 0.085332 | $ | 0.655775 | 87 | % | — | % | 13 | % | 100% | |||||||||||||||||
MSCI Japan Value(a) |
0.303401 | — | 0.088205 | 0.391606 | 77 | — | 23 | 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 e-mail 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 and Rule 30e-3 notices 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 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 their reports on Form N-PORT. The Funds’ Form N-PORT are available on the SEC’s website at sec.gov. Additionally, each Fund makes its portfolio holdings for the first and third quarters of each fiscal year available at iShares.com/fundreports.
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 Trust’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 |
37 |
Glossary of Terms Used in this Report
Portfolio Abbreviations - Equity
ADR | American Depositary Receipt |
38 |
2 0 2 2 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 | |
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., 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.
©2022 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-819-0222
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