LOGO

  SEPTEMBER 30, 2023

 

  

2023 Semi-Annual Report

(Unaudited)

 

iShares Trust

 

·  

iShares Copper and Metals Mining ETF | ICOP | NASDAQ

 

·  

iShares Environmental Infrastructure and Industrials ETF | EFRA | NASDAQ

 

·  

iShares Global 100 ETF | IOO | NYSE Arca

 

·  

iShares Global Infrastructure ETF | IGF | NASDAQ

 

·  

iShares Global Timber & Forestry ETF | WOOD | NASDAQ

 

·  

iShares Lithium Miners and Producers ETF | ILIT | NASDAQ

 


The Markets in Review

Dear Shareholder,

The combination of continued economic growth and moderating inflation provided a supportive backdrop for investors during the 12-month reporting period ended September 30, 2023. Significantly tighter monetary policy helped to rein in inflation while the economy proved more resilient than many investors anticipated. A moderating labor market also helped ease inflationary pressure, although wages continued to grow and unemployment rates touched the lowest levels in decades. This robust labor market powered further growth in consumer spending, backstopping the economy. On October 7, 2023, Hamas launched a horrific attack on Israel. The ensuing war will have a significant humanitarian impact and could lead to heightened economic and market volatility. We see geopolitics as a structural market risk going forward. See our geopolitical risk dashboard at blackrock.com for more details.

Equity returns were substantial, as the durability of consumer sentiment and spending mitigated investors’ concerns about the economy’s trajectory. The U.S. economy resumed growth in the third quarter of 2022 and continued to expand thereafter. All major classes of equities rose, although large-capitalization U.S. stocks posted significantly higher returns than small-capitalization U.S. stocks due primarily to the performance of large technology companies. International developed market equities also advanced strongly, and emerging market equities posted solid gains.

The 10-year U.S. Treasury yield rose during the reporting period, driving its price down, as investors reacted to elevated inflation and attempted to anticipate future interest rate changes. The corporate bond market benefited from improving economic sentiment, although high-yield corporate bond prices fared significantly better than investment-grade bonds as demand from yield-seeking investors remained strong.

The U.S. Federal Reserve (the “Fed”), attempting to manage persistent inflation, raised interest rates six times during the 12-month period. Furthermore, the Fed wound down its bond-buying programs and incrementally reduced its balance sheet by not replacing securities that reach maturity. However, the Fed declined to raise interest rates at two of its meetings late in the period.

Supply constraints appear to have become an embedded feature of the new macroeconomic environment, making it difficult for developed economies to increase production without sparking higher inflation. Geopolitical fragmentation and an aging population risk further exacerbating these constraints, keeping the labor market tight and wage growth high. Although the Fed has decelerated the pace of interest rate hikes and recently opted for two pauses, we believe that the new economic regime means that the Fed will need to maintain high rates for an extended period to keep inflation under control. Furthermore, ongoing structural changes may mean that the Fed will be hesitant to cut interest rates in the event of faltering economic activity lest inflation accelerate again. We believe investors should expect a period of higher volatility as markets adjust to the new economic reality and policymakers attempt to adapt.

While we favor an overweight position in developed market equities in the long term, we prefer an underweight stance in the near term. Expectations for corporate earnings remain elevated, which seems inconsistent with macroeconomic constraints. Nevertheless, we are overweight on Japanese stocks in the near term as shareholder-friendly policies generate increased investor interest. We also believe that stocks with an AI tilt should benefit from an investment cycle that is set to support revenues and margins. In credit, there are selective opportunities in the near term despite tightening credit and financial conditions. For fixed income investing with a six- to twelve-month horizon, we see the most attractive investments in short-term U.S. Treasuries, U.S. inflation-linked bonds, euro area government bonds and gilts, U.S. mortgage-backed securities, and hard-currency emerging market bonds.

Overall, our view is that investors need to think globally, position themselves to be prepared for a decarbonizing economy, 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.

 

LOGO

Rob Kapito

President, BlackRock, Inc.

LOGO

Rob Kapito

President, BlackRock, Inc.

 

Total Returns as of September 30, 2023

 

    

 

6-Month

 

 

 

12-Month

 

 

U.S. large cap equities
(S&P 500® Index)

 

 

 

    5.18%

 

 

   21.62%

 

U.S. small cap equities
(Russell 2000® Index)

 

 

 

  (0.19)

 

 

 8.93

 

International equities
(MSCI Europe, Australasia, Far East Index)

 

 

 

  (1.28)

 

 

25.65

 

Emerging market equities
(MSCI Emerging Markets Index)

 

 

 

  (2.05)

 

 

11.70

 

3-month Treasury bills
(ICE BofA 3-Month U.S. Treasury Bill Index)

 

 

 

   2.50 

 

 

 4.47

 

U.S. Treasury securities
(ICE BofA 10-Year U.S. Treasury Index)

 

 

 

  (6.98)

 

 

  (2.90)

 

 

U.S. investment grade bonds
(Bloomberg U.S. Aggregate Bond Index)

 

 

 

  (4.05)

 

 

 0.64

 

Tax-exempt municipal bonds
(Bloomberg Municipal Bond Index)

 

 

 

  (4.05)

 

 

 2.66

 

U.S. high yield bonds
(Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index)

 

 

 

   2.22 

 

 

10.28

 

Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

 

 

2  

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


Table of Contents

 

      Page  

The Markets in Review

     2  

Semi-Annual Report:

  

Fund Summary

     4  

About Fund Performance

     10  

Disclosure of Expenses

     10  

Schedules of Investments

     11  

Financial Statements

  

Statements of Assets and Liabilities

     27  

Statements of Operations

     29  

Statements of Changes in Net Assets

     31  

Financial Highlights

     34  

Notes to Financial Statements

     40  

Board Review and Approval of Investment Advisory Contract

     49  

Supplemental Information

     55  

General Information

     56  

Glossary of Terms Used in this Report

     57  

 

 

      


Fund Summary  as of September 30, 2023    iShares® Copper and Metals Mining ETF

 

Investment Objective

The iShares Copper and Metals Mining ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. equities of companies primarily engaged in copper and metal ore mining, as represented by the STOXX Global Copper and Metals Mining 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

  (4.72)%

Fund Market

  (4.05)   

Index

  (3.92)   

The inception date of the Fund was June 21, 2023. The first day of secondary market trading was June 23, 2023.

Past performance is not an indication 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” for more information.

Expense Example

 

    Actual           Hypothetical 5% Return                  
 

 

 

     

 

           
    Beginning        Ending        Expenses       Beginning      Ending        Expenses               Annualized  
    Account Value        Account Value        Paid During       Account Value      Account Value        Paid During               Expense  
      (06/21/23) (a)        (09/30/23)        the Period (b)            (04/01/23)      (09/30/23)        the Period (b)                Ratio  
      $      1,000.00        $        952.80        $          1.27             $      1,000.00      $      1,022.70        $        2.38                 0.47

 

  (a) 

Commencement of operations.

 
  (b) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 101/366 for actual expenses and 183/366 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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

INDUSTRY ALLOCATION

 

   
Industry    

Percent of

Total Investments

 

(a) 

Diversified Metals & Mining

    42.9

Copper

    42.3  

Gold

    11.8  

Steel

    3.0  

TEN LARGEST HOLDINGS

   
Security    
Percent of
Total Investments
 
(a) 

Grupo Mexico SAB de CV, Series B

    8.2

BHP Group Ltd.

    8.2  

Newcrest Mining Ltd.

    7.9  

Freeport-McMoRan Inc.

    7.6  

Antofagasta PLC

    6.1  

First Quantum Minerals Ltd.

    6.0  

KGHM Polska Miedz SA

    4.6  

Ivanhoe Mines Ltd., Class A

    4.5  

Lundin Mining Corp.

    4.5  

Southern Copper Corp.

    4.4  

 

  (a) 

Excludes money market funds.

 

 

 

4  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Fund Summary  as of September 30, 2023    iShares® Environmental Infrastructure and Industrials ETF

 

Investment Objective

The iShares Environmental Infrastructure and Industrials ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. companies that provide infrastructure and industrials solutions aiming to support energy efficiency and emissions mitigation, pollution reduction or land and resource optimization, as represented by the FTSE Green Revenues Select Infrastructure and Industrials 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    
    

6-Month

Total Returns

        

Since    

Inception    

Fund NAV

    (5.00 )%      4.27%    

Fund Market

    (4.85     4.58       

Index

    (4.65       4.66       

The inception date of the Fund was November 01, 2022. The first day of secondary market trading was November 3, 2022.

Past performance is not an indication 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” for more information.

Expense Example

 

    Actual           Hypothetical 5% Return                  
 

 

     

 

           
  Beginning      Ending        Expenses       Beginning      Ending        Expenses               Annualized  
  Account Value      Account Value        Paid During       Account Value      Account Value        Paid During               Expense  
    (04/01/23)      (09/30/23)        the Period (a)            (04/01/23)      (09/30/23)        the Period (a)                Ratio  
    $        1,000.00      $        950.00        $        2.29             $        1,000.00      $        1,022.70        $        2.38                 0.47

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/366 (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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION

 

   
Sector    

Percent of

Total Investments

 

(a) 

Industrials

    56.0

Utilities

    28.6  

Materials

    8.6  

Information Technology

    6.8  

TEN LARGEST HOLDINGS

 

   
Security    
Percent of
Total Investments

(a) 

Westinghouse Air Brake Technologies Corp.

    6.2

Veolia Environnement SA

    6.0  

Xylem Inc./NY

    6.0  

American Water Works Co. Inc.

    5.6  

Pentair PLC

    5.3  

Clean Harbors Inc.

    4.2  

Essential Utilities Inc.

    4.1  

Intertek Group PLC

    4.0  

Tetra Tech Inc.

    4.0  

United Utilities Group PLC

    3.9  

 

  (a) 

Excludes money market funds.

 

 

 

U N D    U M M A R Y

  5


Fund Summary  as of September 30, 2023    iShares® Global 100 ETF

 

Investment Objective

The iShares Global 100 ETF (the “Fund”) seeks to track the investment results of an index composed of 100 large-capitalization global equities, as represented by the S&P Global 100TM (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-Month

Total Returns

     1 Year      5 Years     10 Years             1 Year      5 Years      10 Years  

Fund NAV

    5.57      25.09      10.42     9.87        25.09      64.17      156.38

Fund Market

    5.63        25.27        10.49       9.87          25.27        64.71        156.31  

Index

    5.64        24.86        10.37       9.78                24.86        63.80        154.20  

Past performance is not an indication 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” for more information.

Expense Example

 

Actual           Hypothetical 5% Return           

 

 

     

 

 

      
 


Beginning

Account Value
(04/01/23)

 


 

      


Ending

Account Value
(09/30/23)

 


 

      

Expenses

Paid During

the Period

 

 

(a) 

           

Beginning

Account Value

(04/01/23)

 

 

 

      


Ending

Account Value
(09/30/23)

 


 

      

Expenses

Paid During

the Period

 

 

(a) 

      

Annualized

Expense

Ratio

 

 

 

  $      1,000.00          $      1,055.70          $      2.11               $      1,000.00          $      1,023.00          $      2.07          0.41

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/366 (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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION

 

   
Sector    

Percent of

Total Investments

 

(a) 

Information Technology

    35.4

Health Care

    12.8  

Consumer Discretionary

    10.7  

Financials

    9.9  

Consumer Staples

    9.3  

Communication Services

    8.8  

Energy

    6.1  

Industrials

    4.4  

Materials

    1.6  

Other (each representing less than 1%)

    1.0  

GEOGRAPHIC ALLOCATION

 

Country/Geographic Region    

Percent of

Total Investments

 

(a) 

United States

    75.2

United Kingdom

    6.0  

Switzerland

    4.3  

France

    3.7  

Japan

    2.9  

Germany

    2.7  

Netherlands

    1.5  

South Korea

    1.2  

China

    1.2  

Australia

    0.7  

 

  (a) 

Excludes money market funds.

 

 

 

6  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Fund Summary  as of September 30, 2023    iShares® Global Infrastructure ETF

 

Investment Objective

The iShares Global Infrastructure ETF (the “Fund”) seeks to track the investment results of an index composed of developed market equities in the infrastructure industry, as represented by the S&P Global Infrastructure IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

           Average Annual Total Returns            Cumulative Total Returns  
    

6-Month

Total Returns

     1 Year      5 Years     10 Years             1 Year      5 Years      10 Years  

Fund NAV

    (7.85 )%       6.44      3.34     4.36        6.44      17.87      53.19

Fund Market

    (7.93      6.13        3.36       4.33          6.13        17.95        52.77  

Index

    (7.89      5.90        3.18       4.20                5.90        16.92        50.88  

Past performance is not an indication 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” for more information.

Expense Example

 

Actual           Hypothetical 5% Return           

 

 

     

 

 

      
 

Beginning

Account Value

(04/01/23)

 

 

 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a) 

           

Beginning

Account Value

(04/01/23)

 

 

 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a) 

      

Annualized

Expense

Ratio

 

 

 

  $      1,000.00          $      921.50          $      2.07               $      1,000.00          $      1,022.80          $      2.17          0.43

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/366 (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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

INDUSTRY ALLOCATION

 

Industry    

Percent of

Total Investments

 

(a) 

Airport Services

    24.7

Electric Utilities

    23.8  

Oil & Gas Storage & Transportation

    20.5  

Multi-Utilities

    11.8  

Highways & Railtracks

    11.8  

Marine Ports & Services

    4.0  

Independent Power Producers & Energy Traders

    1.4  

Water Utilities

    1.3  

Other (each representing less than 1%)

    0.7  

GEOGRAPHIC ALLOCATION

 

Country/Geographic Region    

Percent of

Total Investments

 

(a) 

United States

    38.3

Australia

    8.9  

Canada

    8.8  

Spain

    8.1  

Mexico

    7.0  

France

    6.4  

China

    4.7  

Germany

    3.3  

New Zealand

    3.1  

Italy

    2.6  

 

  (a) 

Excludes money market funds.

 

 

 

U N D    U M M A R Y

  7


Fund Summary  as of September 30, 2023    iShares® Global Timber & Forestry ETF

 

Investment Objective

The iShares Global Timber & Forestry ETF (the “Fund”) seeks to track the investment results of an index composed of global equities in or related to the timber and forestry industry, as represented by the S&P Global Timber & Forestry IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

           Average Annual Total Returns            Cumulative Total Returns  
    

6-Month

Total Returns

     1 Year      5 Years     10 Years             1 Year      5 Years      10 Years  

Fund NAV

    4.92      15.10      1.54     5.90        15.10      7.95      77.44

Fund Market

    5.33        15.40        1.63       5.89          15.40        8.43        77.31  

Index

    5.39        14.82        1.38       5.77                14.82        7.08        75.20  

Past performance is not an indication 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” for more information.

Expense Example

 

Actual           Hypothetical 5% Return           

 

 

     

 

 

      
 

Beginning

Account Value

(04/01/23)

 

 

 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a) 

           

Beginning

Account Value

(04/01/23)

 

 

 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a) 

      

Annualized

Expense

Ratio

 

 

 

  $      1,000.00          $      1,049.20          $      2.10               $      1,000.00          $      1,023.00          $      2.07          0.41

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/366 (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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

INDUSTRY ALLOCATION

 

Industry    

Percent of

Total Investments

 

(a) 

Paper Products

    39.0

Paper & Plastic Packaging Products & Materials

    22.5  

Timber REITs

    16.9  

Forest Products

    16.2  

Homebuilding

    3.5  

Oil & Gas Refining & Marketing

    1.9  

GEOGRAPHIC ALLOCATION

 

Country/Geographic Region    

Percent of

Total Investments

 

(a) 

United States

    30.1

Sweden

    12.7  

Brazil

    11.8  

Finland

    9.3  

Japan

    8.3  

Canada

    8.3  

Ireland

    5.9  

United Kingdom

    4.0  

Chile

    3.3  

Taiwan

    1.7  

 

  (a)

Excludes money market funds.

 

 

 

8  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Fund Summary  as of September 30, 2023    iShares® Lithium Miners and Producers ETF

 

Investment Objective

The iShares Lithium Miners and Producers ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. equities of companies primarily engaged in lithium ore mining and/or lithium compounds manufacturing, as represented by the STOXX Global Lithium Miners and Producers 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

                      (26.41 )% 

Fund Market

                      (25.91

Index

                                    (26.03

The inception date of the Fund was June 21, 2023. The first day of secondary market trading was June 23, 2023.

Past performance is not an indication 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” for more information.

Expense Example

 

Actual           Hypothetical 5% Return           

 

 

     

 

 

      
 

Beginning

Account Value

(06/21/23)

 

 

(a) 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(b) 

           

Beginning

Account Value

(04/01/23)

 

 

 

      

Ending

Account Value

(09/30/23)

 

 

 

      

Expenses

Paid During

the Period

 

 

(b) 

      

Annualized

Expense

Ratio

 

 

 

  $      1,000.00          $      735.90          $      1.13               $      1,000.00          $      1,022.70          $      2.38          0.47

 

  (a) 

Commencement of operations.

 
  (b) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 101/366 for actual expenses and 183/366 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 “Disclosure of Expenses” for more information.

 

Portfolio Information

 

INDUSTRY ALLOCATION

 

Industry    

Percent of

Total Investments

 

(a) 

Diversified Metals & Mining

    43.3

Specialty Chemicals

    30.9  

Electrical Components & Equipment

    12.5  

Commodity Chemicals

    8.6  

Technology Hardware, Storage & Peripherals

    4.7  

TEN LARGEST HOLDINGS

 

Security    

Percent of

Total Investments

 

(a) 

Sociedad Quimica y Minera de Chile SA

    8.6

Pilbara Minerals Ltd.

    8.1  

Albemarle Corp.

    8.0  

Livent Corp.

    7.7  

Allkem Ltd.

    7.6  

Sigma Lithium Corp.

    4.9  

Liontown Resources Ltd.

    4.8  

CosmoAM&T Co. Ltd.

    4.7  

Lithium Americas Corp.

    4.6  

SK IE Technology Co. Ltd.

    4.4  

 

  (a) 

Excludes money market funds.

 

 

 

U N D    U M M A R Y

  9


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.

Disclosure of Expenses

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 the 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 the 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.

 

 

10  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) 

September 30, 2023

  

iShares® Copper and Metals Mining ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Metals & Mining — 99.6%            

29Metals Ltd.

    26,030     $ 11,511  

Al Masane Al Kobra Mining Co.

    2,751       38,240  

Anglo American PLC

    5,735       157,481  

Antofagasta PLC

    16,564       287,547  

Baiyin Nonferrous Group Co. Ltd.

    29,900       11,667  

BHP Group Ltd.

    13,853       389,142  

Capstone Mining Corp.(a)

    29,337       124,411  

Chengtun Mining Group Co. Ltd., Class A(a)

    1,600       1,028  

China Nonferrous Mining Corp Ltd.

    79,000       50,503  

CMOC Group Ltd., Class A

    7,900       6,432  

ERO Copper Corp.(a)

    5,415       93,370  

Evolution Mining Ltd.

    14,136       29,510  

Filo Corp., NVS(a)

    5,888       87,957  

First Quantum Minerals Ltd.

    11,970       282,803  

Freeport-McMoRan Inc.

    9,711       362,123  

Glencore PLC

    27,431       156,206  

Grupo Mexico SAB de CV, Series B

    82,276       389,439  

Hudbay Minerals Inc.

    23,718       115,425  

Ivanhoe Mines Ltd., Class A(a)

    25,178       215,772  

Jiangxi Copper Co. Ltd., Class A

    8,400       22,216  

Jinchuan Group International Resources Co. Ltd.

    182,000       9,962  

KGHM Polska Miedz SA

    8,600       219,089  

Lundin Mining Corp.

    28,855       215,204  

MMG Ltd.(a)

    192,000       58,457  

Newcrest Mining Ltd.

    23,741       374,076  

Newmont Corp.

    3,779       139,634  

Nittetsu Mining Co. Ltd.

    900       30,127  

Rio Tinto PLC, ADR(b)

    3,082         196,138  

Sandfire Resources Ltd.(a)

    31,247       121,743  
Security   Shares     Value  
Metals & Mining (continued)            

Southern Copper Corp.

    2,776     $ 209,005  

Teck Resources Ltd., Class B

    3,496       150,470  

Vale SA

    10,618       142,755  

WA1 Resources Ltd., NVS

    2,530       8,341  

Western Mining Co. Ltd., Class A

    9,600       16,953  

Yunnan Copper Co. Ltd.

    8,100       13,090  

Zijin Mining Group Co. Ltd., Class A

    9,200       15,318  
   

 

 

 
      4,753,145  
   

 

 

 

Total Long-Term Investments — 99.6%
(Cost: $5,031,390)

      4,753,145  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 4.1%            

BlackRock Cash Funds: Institutional, SL Agency Shares, 5.54%(c)(d)(e)

    195,222       195,281  
   

 

 

 

Total Short-Term Securities — 4.1%
(Cost: $195,300)

      195,281  
   

 

 

 

Total Investments — 103.7%
(Cost: $5,226,690)

      4,948,426  

Liabilities in Excess of Other Assets — (3.7)%

      (176,536
   

 

 

 

Net Assets — 100.0%

    $   4,771,890  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period end.

(e) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the period ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    

Value at

06/21/23

 

(a) 

   

Purchases

at Cost

 

 

   

Proceeds

from Sale

 

 

   

Net Realized

Gain (Loss)

 

 

   

Change in

Unrealized

Appreciation

(Depreciation)

 

 

 

 

   

Value at

09/30/23

 

 

   

Shares

Held at

09/30/23

 

 

 

    Income      

Capital

Gain

Distributions

from

Underlying

Funds

 

 

 

 

 

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $     $ 195,300 (b)    $     $     $ (19   $ 195,281       195,222     $ 9 (c)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares(d)

          0 (b)                                    19        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $     $ (19   $ 195,281       $ 28     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Commencement of operations.

 
  (b) 

Represents net amount purchased (sold).

 
  (c)

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 
  (d) 

As of period end, the entity is no longer held.

 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  11


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Copper and Metals Mining ETF

 

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

                 

Micro E-Mini Russell 2000 Index

     2          12/15/23        $ 18        $ (670
                 

 

 

 

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:

 

     

Commodity

Contracts

      

Credit

Contracts

      

Equity

Contracts

      

Foreign

Currency

Exchange

Contracts

      

Interest

Rate

Contracts

      

Other

Contracts

       Total  

Liabilities — Derivative Financial Instruments

                                

Futures contracts

                                

Unrealized depreciation on futures contracts(a)

   $        $        $ 670        $        $        $        $ 670  
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

     

Commodity

Contracts

      

Credit

Contracts

      

Equity

Contracts

      

Foreign

Currency

Exchange

Contracts

      

Interest

Rate

Contracts

      

Other

Contracts

       Total  

Net Realized Gain (Loss) from

                                

Futures contracts

   $        $        $ (2,391      $        $        $        $ (2,391
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                                

Futures contracts

   $        $        $ (670      $        $        $        $ (670
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 8,993  

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  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 2,724,506        $ 2,028,639        $        $ 4,753,145  

Short-Term Securities

                 

Money Market Funds

     195,281                            195,281  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,919,787        $ 2,028,639        $        $ 4,948,426  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (670      $        $        $ (670
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

12  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) 

September 30, 2023

  

iShares® Environmental Infrastructure and Industrials ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Building Products — 6.9%            

Advanced Drainage Systems Inc.(a)

    1,399     $ 159,248  

China Lesso Group Holdings Ltd.

    20,000       10,615  

Reliance Worldwide Corp. Ltd.

    16,120       40,060  

TOTO Ltd.

    3,000       77,415  
   

 

 

 
      287,338  
Chemicals — 2.4%            

Umicore SA

    4,190       99,205  
   

 

 

 
Commercial Services & Supplies — 11.0%            

Befesa SA(b)

    818       24,933  

Beijing GeoEnviron Engineering & Technology Inc.

    2,400       3,099  

Clean Harbors Inc.(c)

    1,039       173,887  

Stericycle Inc.(c)

    1,890       84,502  

Sunny Friend Environmental Technology Co. Ltd.

    1,124       3,954  

Tetra Tech Inc.

    1,088       165,409  
   

 

 

 
      455,784  
Construction & Engineering — 4.5%            

Stantec Inc.

    2,289       148,521  

Sweco AB, Class B

    4,132       38,536  
   

 

 

 
      187,057  
Containers & Packaging — 2.2%            

DS Smith PLC

    26,288       91,685  
   

 

 

 
Electronic Equipment, Instruments & Components — 6.8%  

Badger Meter Inc.

    599       86,178  

Landis+Gyr Group AG

    440       31,756  

Riken Keiki Co. Ltd.

    400       16,115  

Shimadzu Corp.

    5,500       145,889  
   

 

 

 
      279,938  
Machinery — 27.4%            

Construcciones y Auxiliar de Ferrocarriles SA

    535       16,696  

Dawonsys Co. Ltd.(c)

    576       7,087  

Franklin Electric Co. Inc.

    947       84,501  

Lindsay Corp.

    224       26,360  

METAWATER Co. Ltd.

    400       4,986  

Mueller Water Products Inc., Class A

    3,144       39,866  

NGK Insulators Ltd.

    5,200       68,919  

Organo Corp.

    500       14,021  

Pentair PLC

    3,366       217,949  

TOMRA Systems ASA

    4,784       54,365  

Torishima Pump Manufacturing Co. Ltd.

    400       5,083  

Watts Water Technologies Inc., Class A

    560       96,779  

Westinghouse Air Brake Technologies Corp.

    2,399       254,942  

Xylem Inc./NY

    2,701       245,872  
   

 

 

 
      1,137,426  
Metals & Mining — 3.9%            

Asahi Holdings Inc.

    1,500       19,022  

Dowa Holdings Co. Ltd.

    900       27,967  

Sibanye Stillwater Ltd.

    57,520       88,304  

Sims Ltd.

    3,244       27,905  
   

 

 

 
      163,198  
Multi-Utilities — 7.0%            

Qatar Electricity & Water Co. QSC

    9,320       44,787  
Security   Shares     Value  

Multi-Utilities (continued)

   

Veolia Environnement SA

    8,526     $ 246,454  
   

 

 

 
      291,241  
Professional Services — 5.6%            

Arcadis NV

    1,476       66,225  

Intertek Group PLC

    3,316       165,830  
   

 

 

 
      232,055  
Water Utilities — 21.5%            

Aguas Andinas SA, Class A

    56,191       16,944  

American States Water Co.

    752       59,167  

American Water Works Co. Inc.

    1,877       232,429  

Beijing Enterprises Water Group Ltd.

    80,000       17,413  

California Water Service Group

    1,177       55,684  

Cia. de Saneamento Basico do Estado de Sao Paulo

    7,042       85,501  

Cia. de Saneamento de Minas Gerais-COPASA

    3,856       13,279  

Essential Utilities Inc.

    4,983       171,066  

Penno Group PLC

    5,332       38,067  

SJW Group

    650       39,072  

United Utilities Group PLC

    14,033       162,151  
   

 

 

 
      890,773  
   

 

 

 

Total Common Stocks — 99.2%
(Cost: $3,983,849)

      4,115,700  
   

 

 

 

Preferred Stocks

   
Machinery — 0.3%            

Marcopolo SA, Preference Shares, NVS

    11,986       13,878  
   

 

 

 

Total Preferred Stocks — 0.3%
(Cost: $15,442)

      13,878  
   

 

 

 

Total Long-Term Investments — 99.5%
(Cost: $3,999,291)

      4,129,578  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 3.6%            

BlackRock Cash Funds: Institutional,
SL Agency Shares, 5.54%(d)(e)(f)

    146,782       146,826  
   

 

 

 

Total Short-Term Securities — 3.6%
(Cost: $146,826)

      146,826  
   

 

 

 

Total Investments — 103.1%
(Cost: $4,146,117)

      4,276,404  

Liabilities in Excess of Other Assets — (3.1)%

      (127,217
   

 

 

 

Net Assets — 100.0%

    $   4,149,187  
   

 

 

 

 

(a) 

All or a portion of this security is on loan.

(b) 

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(c) 

Non-income producing security.

(d) 

Affiliate of the Fund.

(e) 

Annualized 7-day yield as of period end.

(f) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  13


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Environmental Infrastructure and Industrials ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer  

Value at

03/31/23

   

Purchases

at Cost

   

Proceeds

from Sale

   

Net Realized

Gain (Loss)

   

Change in

Unrealized

Appreciation

(Depreciation)

   

Value at

09/30/23

   

Shares

Held at

09/30/23

   

Income

   

Capital

Gain

Distributions

from

Underlying

Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $     $ 146,824 (a)    $     $ 2     $     $ 146,826       146,782     $ 44 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares(c)

          0 (a)                                    27        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ 2     $     $ 146,826       $ 71     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 
  (c)

As of period end, the entity is no longer held.

 

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

           

Micro E-Mini Russell 2000 Index

     2        12/15/23      $ 18      $ (448
           

 

 

 

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:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 448      $      $      $      $ 448  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $ 1,213      $      $      $      $ 1,213  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $ (793    $      $      $      $ (793
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 13,753  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

 

 

14  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Environmental Infrastructure and Industrials ETF

 

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  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 2,440,212        $ 1,675,488        $        $ 4,115,700  

Preferred Stocks

     13,878                            13,878  

Short-Term Securities

                 

Money Market Funds

     146,826                            146,826  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,600,916        $ 1,675,488        $        $ 4,276,404  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (448      $        $             —        $ (448
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  15


Schedule of Investments  (unaudited)

September 30, 2023

  

iShares® Global 100 ETF

(Percentages shown are based on Net Assets)

 

Security   Shares      Value  

Common Stocks

 

Australia — 0.7%  

BHP Group Ltd.

    1,020,878      $ 28,677,287  
    

 

 

 
China — 1.2%             

Tencent Holdings Ltd.

    1,251,700        48,520,813  
    

 

 

 
France — 3.7%             

AXA SA

    351,496        10,428,486  

Cie. de Saint-Gobain

    103,094        6,170,215  

Engie SA

    351,710        5,393,880  

L’Oreal SA

    46,465        19,255,656  

LVMH Moet Hennessy Louis Vuitton SE

    52,605        39,707,854  

Sanofi

    224,248        24,078,685  

Schneider Electric SE

    108,620        17,899,715  

TotalEnergies SE

    468,208        30,784,357  
    

 

 

 
       153,718,848  
Germany — 2.7%             

Allianz SE, Registered

    81,302        19,347,934  

BASF SE

    181,131        8,198,885  

Bayer AG, Registered

    197,064        9,463,878  

Deutsche Bank AG, Registered

    409,249        4,497,757  

Deutsche Telekom AG, Registered

    704,742        14,783,227  

E.ON SE

    450,353        5,325,878  

Mercedes-Benz Group AG

    162,370        11,300,420  

Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen, Registered

    27,621        10,757,068  

RWE AG

    135,780        5,040,125  

Siemens AG, Registered

    151,535        21,655,660  
    

 

 

 
       110,370,832  
Japan — 2.9%             

Bridgestone Corp.

    117,400        4,574,836  

Canon Inc.

    202,450        4,876,744  

Honda Motor Co. Ltd.

    1,001,200        11,263,191  

Mitsubishi UFJ Financial Group Inc.

    2,544,500        21,562,489  

Panasonic Holdings Corp.

    491,900        5,552,453  

Seven & i Holdings Co. Ltd.

    159,620        6,249,152  

Sony Group Corp.

    252,700        20,664,682  

Toyota Motor Corp.

    2,486,100        44,601,442  
    

 

 

 
       119,344,989  
Netherlands — 1.5%             

ASML Holding NV

    81,233        47,825,929  

ING Groep NV

    733,283        9,664,719  

Koninklijke Philips NV(a)(b)

    186,273        3,716,565  
    

 

 

 
       61,207,213  
South Korea — 1.3%             

Samsung Electronics Co. Ltd.

    1,031,877        52,165,622  
    

 

 

 
Spain — 0.6%             

Banco Bilbao Vizcaya Argentaria SA

    1,209,695        9,789,975  

Banco Santander SA

    3,273,277        12,464,864  

Telefonica SA

    1,153,490        4,712,400  
    

 

 

 
       26,967,239  
Switzerland — 4.3%             

ABB Ltd., Registered

    327,437        11,687,268  

Nestle SA, Registered

    538,061        60,906,351  

Novartis AG, Registered

    417,657        42,654,738  

Roche Holding AG, Bearer

    5,680        1,668,709  

Roche Holding AG, NVS

    141,581        38,651,759  

Swiss Re AG

    57,953        5,951,793  
Security   Shares      Value  
Switzerland (continued)             

UBS Group AG, Registered

    614,976      $ 15,148,206  
    

 

 

 
       176,668,824  
United Kingdom — 5.9%             

Anglo American PLC

    268,306        7,367,574  

AstraZeneca PLC

    312,332        42,128,718  

Barclays PLC

    2,944,778        5,675,849  

BP PLC

    3,450,568        22,242,135  

Diageo PLC

    451,582        16,648,967  

GSK PLC

    827,187        14,966,950  

HSBC Holdings PLC

    4,034,798        31,573,839  

National Grid PLC

    750,019        8,969,737  

Prudential PLC

    552,272        5,936,553  

Rio Tinto PLC

    225,760        14,176,022  

Shell PLC

    1,349,707        42,777,905  

Standard Chartered PLC

    463,097        4,259,348  

Unilever PLC

    507,151        25,087,132  

Vodafone Group PLC

    4,566,547        4,280,677  
    

 

 

 
       246,091,406  
United States — 74.9%             

3M Co.

    111,705        10,457,822  

Abbott Laboratories

    349,714        33,869,801  

Alphabet Inc., Class A(a)

    1,195,641        156,461,582  

Alphabet Inc., Class C, NVS(a)

    1,017,063        134,099,757  

Amazon.com Inc.(a)

    1,829,754        232,598,328  

American Tower Corp.

    94,064        15,468,825  

Aon PLC, Class A

    40,990        13,289,778  

Apple Inc.

    2,961,629        507,060,501  

Bristol-Myers Squibb Co.

    421,002        24,434,956  

Broadcom Inc.

    83,160        69,071,033  

Caterpillar Inc.

    102,796        28,063,308  

Chevron Corp.

    357,555        60,290,924  

Citigroup Inc.

    388,617        15,983,817  

Coca-Cola Co.(The)

    784,309        43,905,618  

Colgate-Palmolive Co.

    167,195        11,889,236  

DuPont de Nemours Inc.

    92,080        6,868,247  

Eli Lilly & Co.

    160,696        86,314,642  

Emerson Electric Co.

    114,635        11,070,302  

Exxon Mobil Corp.

    806,737        94,856,136  

Ford Motor Co.

    796,603        9,893,809  

General Electric Co.

    219,324        24,246,268  

Goldman Sachs Group Inc. (The)

    66,429        21,494,432  

Honeywell International Inc.

    133,801        24,718,397  

HP Inc.

    174,033        4,472,648  

Intel Corp.

    843,981        30,003,525  

International Business Machines Corp.

    183,586        25,757,116  

Johnson & Johnson

    485,272        75,581,114  

Johnson Controls International PLC

    136,460        7,261,037  

JPMorgan Chase & Co.

    585,637        84,929,078  

Kimberly-Clark Corp.

    67,827        8,196,893  

Marsh & McLennan Companies Inc.

    99,592        18,952,358  

Mastercard Inc., Class A

    167,668        66,381,438  

McDonald’s Corp.

    146,854        38,687,218  

Merck & Co. Inc.

    511,370        52,645,542  

Microsoft Corp.

    1,497,268        472,762,371  

Morgan Stanley

    257,114        20,998,500  

Nike Inc., Class B

    246,879        23,606,570  

Nvidia Corp.

    497,764        216,522,362  

PepsiCo Inc.

    277,411        47,004,520  

Pfizer Inc.

    1,137,797        37,740,727  

Philip Morris International Inc.

    312,828        28,961,616  

 

 

16  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global 100 ETF

(Percentages shown are based on Net Assets)

 

Security

 

Shares

   

    

Value

 
United States (continued)            

Procter & Gamble Co.(The)

    475,054     $ 69,291,376  

Raytheon Technologies Corp.

    293,318       21,110,096  

Texas Instruments Inc.

    182,968       29,093,742  

Thermo Fisher Scientific Inc.

    77,770       39,364,841  

Walmart Inc.

    287,612       45,997,787  
   

 

 

 
      3,101,729,994  
   

 

 

 

Total Long-Term Investments — 99.7%
(Cost: $3,052,785,551)

 

    4,125,463,067  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 0.3%            

BlackRock Cash Funds: Institutional, SL Agency Shares, 5.54%(c)(d)(e)

    3,647,608       3,648,702  

BlackRock Cash Funds: Treasury, SL Agency Shares, 5.31%(c)(d)

    7,180,000       7,180,000  
   

 

 

 

Total Short-Term Securities — 0.3%
(Cost: $10,828,702)

 

    10,828,702  
   

 

 

 

Total Investments — 100.0%
(Cost: $3,063,614,253)

      4,136,291,769  

Other Assets Less Liabilities — 0.0%

      1,881,744  
   

 

 

 

Net Assets — 100.0%

    $ 4,138,173,513  
   

 

 

 
(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period end.

(e) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer   Value at
03/31/23
    Purchases
at Cost
    Proceeds
from Sale
    Net Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
09/30/23
    Shares
Held at
09/30/23
    Income    

Capital

Gain
Distributions
from
Underlying
Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 607,245     $ 3,039,160 (a)    $     $ 2,234     $ 63     $ 3,648,702       3,647,608     $ 3,366 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    3,900,000       3,280,000 (a)                        7,180,000       7,180,000       167,704        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ 2,234     $ 63     $ 10,828,702       $ 171,070     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 

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

                 

Euro Stoxx 50 Index

     27          12/15/23        $ 1,196        $ (31,391

FTSE 100 Index

     7          12/15/23          653          (9,824

S&P 500 E-Mini Index

     45          12/15/23          9,732          (318,948
                 

 

 

 
                  $ (360,163
                 

 

 

 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  17


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global 100 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:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 360,163      $      $      $      $ 360,163  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $ 1,068,337      $      $      $      $ 1,068,337  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $ (850,871    $      $      $      $ (850,871
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 11,369,938  

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  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 3,101,729,994        $ 1,023,733,073        $        $ 4,125,463,067  

Short-Term Securities

                 

Money Market Funds

     10,828,702                            10,828,702  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 3,112,558,696        $ 1,023,733,073        $        $ 4,136,291,769  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (318,948      $ (41,215      $           —        $ (360,163
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

18  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited)

September 30, 2023

  

iShares® Global Infrastructure ETF

(Percentages shown are based on Net Assets)

 

Security   Shares      Value  

Common Stocks

 

Argentina — 0.2%  

Corp. America Airports SA(a)

    498,307      $ 6,647,416  
    

 

 

 
Australia — 8.9%             

Atlas Arteria Ltd.

    19,372,720        68,594,728  

Dalrymple Bay Infrastructure Ltd.(b)

    4,328,345        7,785,069  

Qube Holdings Ltd.

    30,228,086        55,522,171  

Transurban Group

    20,949,707        170,230,117  
    

 

 

 
       302,132,085  
Brazil — 0.8%             

Centrais Eletricas Brasileiras SA, ADR

    1,576,932        11,527,373  

Cia. de Saneamento Basico do Estado de Sao Paulo, ADR(b)

    521,316        6,318,350  

Cia. Paranaense de Energia, ADR

    564,608        4,951,612  

Ultrapar Participacoes SA, ADR

    1,624,757        5,962,858  
    

 

 

 
       28,760,193  
Canada — 8.7%             

Enbridge Inc.

    4,734,152        157,020,834  

Keyera Corp.

    513,622        12,059,198  

Pembina Pipeline Corp.

    1,230,966        37,012,812  

TC Energy Corp.

    2,307,456        79,353,042  

Westshore Terminals Investment Corp.

    588,609        10,916,297  
    

 

 

 
       296,362,183  
China — 4.7%             

Anhui Expressway Co. Ltd., Class H

    5,150,000        5,386,128  

Beijing Capital International Airport Co. Ltd., Class H(a)

    29,604,000        13,690,941  

CGN Power Co. Ltd., Class H(c)

    16,179,000        4,188,429  

China Gas Holdings Ltd.

    4,481,600        4,224,426  

China Longyuan Power Group Corp. Ltd., Class H

    5,096,000        4,419,629  

China Merchants Port Holdings Co. Ltd.

    21,928,000        27,257,302  

China Resources Gas Group Ltd.

    1,412,100        4,129,067  

China Resources Power Holdings Co. Ltd.

    2,720,000        5,175,244  

COSCO SHIPPING International Hong Kong Co. Ltd.

    7,282,000        3,143,062  

COSCO SHIPPING Ports Ltd.

    25,170,000        16,397,089  

Jiangsu Expressway Co. Ltd., Class H

    20,922,000        18,871,321  

Kunlun Energy Co. Ltd.

    6,080,000        5,232,170  

Shenzhen Expressway Co. Ltd., Class H

    10,498,000        8,563,595  

Shenzhen International Holdings Ltd.

    22,811,500        14,037,729  

Yuexiu Transport Infrastructure Ltd.

    16,042,000        8,479,916  

Zhejiang Expressway Co. Ltd., Class H

    20,132,000        14,980,119  
    

 

 

 
       158,176,167  
France — 6.3%             

Aeroports de Paris

    677,646        79,915,563  

Engie SA

    2,674,659        41,018,993  

Getlink SE

    5,555,115        88,559,087  

Scorpio Tankers Inc.

    107,488        5,817,250  
    

 

 

 
       215,310,893  
Germany — 3.3%             

E.ON SE

    3,424,728        40,552,893  

Fraport AG Frankfurt Airport Services Worldwide(a)

    617,362        32,638,090  

RWE AG

    1,032,543        38,327,779  
    

 

 

 
       111,518,762  
Italy — 2.6%             

Enav SpA(c)

    4,358,835        16,120,063  

Enel SpA

    11,786,336        72,282,557  
    

 

 

 
       88,402,620  
Security   Shares      Value  
Japan — 2.2%             

Iwatani Corp.

    119,600      $ 6,030,420  

Japan Airport Terminal Co. Ltd.

    1,594,600        67,554,200  
    

 

 

 
       73,584,620  
Mexico — 7.0%             

Grupo Aeroportuario del Centro Norte SAB de CV, ADR

    589,919        51,269,860  

Grupo Aeroportuario del Pacifico SAB de CV, ADR

    670,919        110,278,956  

Grupo Aeroportuario del Sureste SAB de CV, ADR

    313,028        76,914,110  
    

 

 

 
       238,462,926  
New Zealand — 3.1%             

Auckland International Airport Ltd.

    22,439,762        106,383,748  
    

 

 

 
Singapore — 1.6%             

Hutchison Port Holdings Trust, Class U(b)

    84,400,500        14,497,389  

SATS Ltd.(a)(b)

    16,672,066        31,643,350  

SIA Engineering Co. Ltd.

    4,327,912        7,556,300  
    

 

 

 
       53,697,039  
South Korea — 0.0%             

Sebang Co. Ltd.

    150,454        1,228,676  
    

 

 

 
Spain — 8.0%             

Aena SME SA(c)

    1,160,266        174,593,999  

Iberdrola SA

    8,814,957        98,590,427  
    

 

 

 
       273,184,426  
Switzerland — 1.8%             

Flughafen Zurich AG, Registered

    325,864        62,043,244  
    

 

 

 
United Kingdom — 2.0%             

National Grid PLC

    5,643,282        67,489,964  
    

 

 

 
United States — 38.1%             

American Electric Power Co. Inc.

    785,854        59,111,937  

American Water Works Co. Inc.

    296,950        36,771,319  

Antero Midstream Corp.

    763,354        9,144,981  

Cheniere Energy Inc.

    539,330        89,507,207  

Consolidated Edison Inc.

    526,151        45,001,695  

Constellation Energy Corp.

    490,562        53,510,503  

Dominion Energy Inc.

    1,276,420        57,017,681  

DTE Midstream LLC(a)

    217,197        11,494,065  

Duke Energy Corp.

    1,175,646        103,762,516  

Edison International

    584,675        37,004,081  

Equitrans Midstream Corp.

    974,817        9,134,035  

Exelon Corp.

    1,518,118        57,369,679  

Kinder Morgan Inc.

    4,344,941        72,039,122  

NextEra Energy Inc.

    2,653,699        152,030,416  

ONEOK Inc.

    1,003,412        63,646,423  

Public Service Enterprise Group Inc.

    761,351        43,328,485  

Sempra Energy

    959,953        65,305,603  

Southern Co.(The)

    1,663,530        107,663,662  

Targa Resources Corp.

    501,428        42,982,408  

WEC Energy Group Inc.

    481,170        38,758,243  

Williams Companies Inc. (The)

    2,726,472        91,854,842  

Xcel Energy Inc.

    841,315        48,140,044  
    

 

 

 
       1,294,578,947  
    

 

 

 

Total Common Stocks — 99.3%
(Cost: $3,505,431,866)

       3,377,963,909  
    

 

 

 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  19


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global Infrastructure ETF

(Percentages shown are based on Net Assets)

 

    

Security

  Shares     Value  

Preferred Stocks

   
Brazil — 0.2%            

Cia. Energetica de Minas Gerais, Preference Shares, ADR

    2,235,523     $ 5,409,966  
   

 

 

 

Total Preferred Stocks — 0.2%
(Cost: $4,123,185)

      5,409,966  
   

 

 

 

Total Long-Term Investments — 99.5%
(Cost: $3,509,555,051)

 

    3,383,373,875  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 0.1%            

BlackRock Cash Funds: Institutional, SL Agency Shares, 5.54%(d)(e)(f)

    1,069,105       1,069,426  

BlackRock Cash Funds: Treasury, SL Agency Shares, 5.31%(d)(e)

    2,690,000       2,690,000  
   

 

 

 

Total Short-Term Securities — 0.1%
(Cost: $3,758,036)

 

    3,759,426  
   

 

 

 

Total Investments — 99.6%
(Cost: $3,513,313,087)

      3,387,133,301  

Other Assets Less Liabilities — 0.4%

 

    12,840,010  
   

 

 

 

Net Assets — 100.0%

 

  $   3,399,973,311  
   

 

 

 
(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(d) 

Affiliate of the Fund.

(e) 

Annualized 7-day yield as of period end.

(f) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer   Value at
03/31/23
    Purchases
at Cost
    Proceeds
from Sale
    Net Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
09/30/23
    Shares
Held at
09/30/23
    Income    

Capital

Gain
Distributions
from
Underlying
Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 8,023,535     $     $ (6,947,927 )(a)    $ (4,649   $ (1,533   $ 1,069,426       1,069,105     $ 119,402 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    16,620,000             (13,930,000 )(a)                  2,690,000       2,690,000       119,354        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ (4,649   $ (1,533   $ 3,759,426       $ 238,756     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 

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

           

IBEX 35 Index

     35        10/20/23      $ 3,483      $ (14,348

S&P/TSE 60 Index

     29        12/14/23        5,023        (124,813

Dow Jones U.S. Real Estate Index

     82        12/15/23        2,494        (79,950

SPI 200 Index

     35        12/21/23        3,960        (78,754
           

 

 

 
            $ (297,865
           

 

 

 

 

 

20  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global Infrastructure 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:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 297,865      $      $      $      $ 297,865  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $ 1,139,463      $      $      $      $ 1,139,463  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $ (1,320,144    $      $      $      $ (1,320,144
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 21,225,527  

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  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 1,977,012,663        $ 1,400,951,246        $        $ 3,377,963,909  

Preferred Stocks

     5,409,966                            5,409,966  

Short-Term Securities

                 

Money Market Funds

     3,759,426                            3,759,426  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 1,986,182,055        $ 1,400,951,246        $        $ 3,387,133,301  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (204,763      $ (93,102      $             —        $ (297,865
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  21


Schedule of Investments  (unaudited)

September 30, 2023

  

iShares® Global Timber & Forestry ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Brazil — 11.7%            

Dexco SA

    518,033     $ 793,557  

Klabin SA

    1,726,030       8,175,940  

Suzano SA

    1,339,193       14,461,489  
   

 

 

 
      23,430,986  
Canada — 8.3%            

Canfor Corp.(a)

    158,397       1,967,353  

Interfor Corp.(a)

    144,346       2,141,411  

Stella-Jones Inc.

    70,580       3,394,284  

West Fraser Timber Co. Ltd.

    124,007       9,003,004  
   

 

 

 
      16,506,052  
Chile — 3.3%            

Empresas CMPC SA

    1,577,496       2,904,340  

Empresas COPEC SA

    521,950       3,700,315  
   

 

 

 
      6,604,655  
China — 1.4%            

Nine Dragons Paper Holdings Ltd.

    3,555,000       1,994,005  

Shandong Sun Paper Industry JSC Ltd., Class A

    481,700       810,306  
   

 

 

 
      2,804,311  
Finland — 9.2%            

Stora Enso OYJ, Class R

    829,498       10,396,404  

UPM-Kymmene OYJ

    232,811       7,971,648  
   

 

 

 
      18,368,052  
Ireland — 5.8%            

Smurfit Kappa Group PLC

    349,649       11,615,258  
   

 

 

 
Japan — 8.3%            

Daio Paper Corp.

    166,100       1,359,138  

Nippon Paper Industries Co. Ltd.(a)

    244,700       2,205,576  

Oji Holdings Corp.

    1,423,100       5,987,295  

Sumitomo Forestry Co. Ltd.

    274,500       6,962,277  
   

 

 

 
      16,514,286  
Portugal — 0.9%            

Altri SGPS SA

    172,669       780,959  

Navigator Co. SA(The)

    299,319       1,127,929  
   

 

 

 
      1,908,888  
Saudi Arabia — 0.2%            

Middle East Paper Co.

    46,919       406,582  
   

 

 

 
South Africa — 1.4%            

Sappi Ltd.

    1,184,193       2,754,439  
   

 

 

 
Spain — 0.6%            

Ence Energia y Celulosa SA

    367,958       1,234,761  
   

 

 

 
Security   Shares     Value  
Sweden — 12.7%            

Billerud AB

    308,160     $ 2,852,464  

Holmen AB, Class B

    194,949       7,577,717  

Svenska Cellulosa AB SCA, Class B

    1,082,713       14,824,629  
   

 

 

 
      25,254,810  
Taiwan — 1.7%            

Cheng Loong Corp.

    1,348,000       1,197,027  

Chung Hwa Pulp Corp.

    998,000       699,533  

YFY Inc.

    1,481,000       1,494,605  
   

 

 

 
      3,391,165  
United Kingdom — 4.0%            

Mondi PLC

    473,796       7,903,795  
   

 

 

 
United States — 29.9%            

Clearwater Paper Corp.(a)(b)

    23,447       849,954  

International Paper Co.

    358,800       12,726,636  

Mercer International Inc.

    123,195       1,057,013  

PotlatchDeltic Corp.

    200,443       9,098,108  

Rayonier Inc.

    310,755       8,844,087  

Sylvamo Corp.

    74,885       3,290,447  

Westrock Co.

    227,015       8,127,137  

Weyerhaeuser Co.

    508,083       15,577,825  
   

 

 

 
      59,571,207  
   

 

 

 

Total Long-Term Investments — 99.4%
(Cost: $210,534,453)

      198,269,247  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 0.0%            

BlackRock Cash Funds: Institutional,
SL Agency Shares, 5.54%(c)(d)(e)

    3,820       3,821  
   

 

 

 

Total Short-Term Securities — 0.0%
(Cost: $3,823)

      3,821  
   

 

 

 

Total Investments — 99.4%
(Cost: $210,538,276)

      198,273,068  

Other Assets Less Liabilities — 0.6%

      1,241,597  
   

 

 

 

Net Assets — 100.0%

    $   199,514,665  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period end.

(e) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

 

22  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global Timber & Forestry ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer  

Value at

03/31/23

   

Purchases

at Cost

   

Proceeds

from Sale

   

Net Realized

Gain (Loss)

   

Change in

Unrealized

Appreciation

(Depreciation)

   

Value at

09/30/23

   

Shares

Held at

09/30/23

    Income    

Capital

Gain

Distributions

from

Underlying

Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 666,559     $     $ (662,963 )(a)    $ (11   $ 236     $ 3,821       3,820     $ 19,461 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares(c)

    260,000             (260,000 )(a)                              7,228        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ (11   $ 236     $ 3,821       $ 26,689     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 
  (c) 

As of period end, the entity is no longer held.

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

 

 
Description   

Number of

Contracts

      

Expiration

Date

      

Notional

Amount

(000)

      

Value/

Unrealized

Appreciation

(Depreciation)

 

 

 

Futures

                 

Russell 1000 E-Mini Value Index

     12          12/15/23        $ 905        $ (31,861
                 

 

 

 

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:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 31,861      $      $      $      $ 31,861  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

     

Commodity

Contracts

    

Credit

Contracts

    

Equity

Contracts

    

Foreign

Currency

Exchange

Contracts

    

Interest

Rate

Contracts

    

Other

Contracts

     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $ 70,703      $      $      $      $ 70,703  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $ (98,121    $      $      $      $ (98,121
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 1,001,105  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  23


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Global Timber & Forestry ETF

 

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  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 109,273,921        $ 88,995,326        $        $ 198,269,247  

Short-Term Securities

                 

Money Market Funds

     3,821                            3,821  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 109,277,742        $     88,995,326        $        $ 198,273,068  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (31,861      $        $             —        $ (31,861
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

24  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Schedule of Investments  (unaudited) 

September 30, 2023

  

iShares® Lithium Miners and Producers ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

 

Chemicals — 38.8%

 

Albemarle Corp.

    1,688     $ 287,028  

Chengxin Lithium Group Co. Ltd., Class A

    7,600       23,386  

Chunbo Co. Ltd.

    624       60,380  

CNGR Advanced Material Co. Ltd.

    5,600       38,974  

Do-Fluoride New Materials Co. Ltd., Class A

    8,800       19,345  

Foosung Co. Ltd.

    7,248       54,873  

Ganfeng Lithium Group Co. Ltd., Class A

    13,200       81,101  

Guangzhou Tinci Materials Technology Co. Ltd., Class A

    16,000       59,442  

Hunan Changyuan Lico Co. Ltd.

    16,000       18,812  

Livent Corp.(a)(b)

    15,072       277,476  

Ningbo Shanshan Co. Ltd.

    18,800       35,916  

Shenzhen Capchem Technology Co. Ltd., Class A

    6,400       38,517  

Shenzhen Dynanonic Co. Ltd.

    2,400       25,281  

Shenzhen Senior Technology Co. Ltd., Class A

    10,800       19,417  

Sichuan Yahua Industrial Group Co. Ltd., Class A

    9,600       19,767  

SK IE Technology Co. Ltd.(a)(c)

    2,888       157,785  

SuZhou TA&A Ultra Clean Technology Co. Ltd., Class A

    6,800       24,055  

Tanaka Chemical Corp.(a)

    2,400       20,509  

Tianqi Lithium Corp., Class A

    12,400       93,757  

Yunnan Energy New Material Co. Ltd., Class A

    8,200       67,604  
   

 

 

 
      1,423,425  
Electrical Equipment — 12.3%            

Beijing Easpring Material Technology Co. Ltd., Class A

    4,400       25,485  

Hunan Yuneng New Energy Battery Material Co. Ltd., NVS

    6,400       31,960  

Jiangsu Ruitai New Energy Materials Co. Ltd., NVS

    6,000       14,879  

Jiangxi Special Electric Motor Co. Ltd., NVS(a)

    14,400       17,583  

Ningbo Ronbay New Energy Technology Co. Ltd.

    3,599       20,768  

Shijiazhuang Shangtai Technology Co. Ltd., NVS

    2,000       13,256  

Sociedad Quimica y Minera de Chile SA, ADR

    5,180       309,091  

XTC New Energy Materials Xiamen Co. Ltd., NVS

    3,200       18,997  
   

 

 

 
      452,019  
Metals & Mining — 42.6%            

Allkem Ltd.(a)

    36,700       274,421  

American Lithium Corp., NVS

    29,772       42,574  

Core Lithium Ltd.(a)

    258,100       66,510  

Lake Resources NL(a)

    197,687       22,677  

Latin Resources Ltd., NVS

    339,902       53,359  
Security   Shares     Value  
Metals & Mining (continued)            

Liontown Resources Ltd.(a)

    92,072     $ 172,550  

Lithium Americas Corp.(a)

    9,855       167,634  

Piedmont Lithium Inc.(a)

    2,664       105,761  

Pilbara Minerals Ltd.

    107,268       292,647  

Sayona Mining Ltd.(a)

    1,264,189       74,922  

Sigma Lithium Corp.(a)

    5,441       176,506  

Sinomine Resource Group Co. Ltd., Class A

    6,000       30,039  

Tibet Mineral Development Co.(a)

    4,400       14,357  

Vulcan Energy Resources Ltd.(a)

    18,080       33,325  

Winsome Resources Ltd., NVS

    23,692       22,182  

Youngy Co. Ltd.

    2,000       15,027  
   

 

 

 
      1,564,491  
Technology Hardware, Storage & Peripherals — 4.6%        

CosmoAM&T Co. Ltd.(a)

    1,544       170,007  
   

 

 

 

Total Long-Term Investments — 98.3%
(Cost: $4,771,640)

      3,609,942  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 12.5%            

BlackRock Cash Funds: Institutional, SL Agency Shares, 5.54%(d)(e)(f)

    459,070       459,208  
   

 

 

 

Total Short-Term Securities — 12.5%
(Cost: $459,252)

      459,208  
   

 

 

 

Total Investments — 110.8%
(Cost: $5,230,892)

      4,069,150  

Liabilities in Excess of Other Assets — (10.8)%

 

    (397,956
   

 

 

 

Net Assets — 100.0%

    $   3,671,194  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(d) 

Affiliate of the Fund.

(e) 

Annualized 7-day yield as of period end.

(f) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the period ended September 30, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer  

Value at   

06/21/23(a)

   

Purchases

at Cost

   

Proceeds

from Sale

   

Net Realized

Gain (Loss)

   

Change in

Unrealized

Appreciation

(Depreciation)

   

Value at

09/30/23

   

Shares

Held at

09/30/23

    Income    

Capital

Gain
Distributions
from
Underlying
Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $     $ 459,252 (b)    $     $     $ (44   $ 459,208       459,070     $     $  

BlackRock Cash Funds: Treasury, SL Agency Shares(c)

          0 (b)                                    313        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $     $ (44   $ 459,208       $ 313     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Commencement of operations.

 
  (b) 

Represents net amount purchased (sold).

 
  (c) 

As of period end, the entity is no longer held.

 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  25


Schedule of Investments  (unaudited) (continued)

September 30, 2023

  

iShares® Lithium Miners and Producers ETF

 

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

                 

Micro E-Mini Russell 2000 Index

     6          12/15/23        $ 54        $ (1,914
                 

 

 

 

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:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 1,914      $      $      $      $ 1,914  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 September 30, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $ (211    $      $      $      $ (211
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $ (1,914    $      $      $      $ (1,914
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 26,979  

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  

Assets

           

Investments

           

Long-Term Investments

           

Common Stocks

   $ 1,398,030      $ 2,211,912      $      $ 3,609,942  

Short-Term Securities

           

Money Market Funds

     459,208                      459,208  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 1,857,238      $ 2,211,912      $      $ 4,069,150  
  

 

 

    

 

 

    

 

 

    

 

 

 

Derivative Financial Instruments(a)

           

Liabilities

           

Equity Contracts

   $ (1,914    $      $           —      $ (1,914
  

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

See notes to financial statements.

 

 

26  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


 

Statements of Assets and Liabilities  (unaudited)

September 30, 2023

 

    

iShares

Copper and

Metals

Mining ETF

   

iShares

Environmental

Infrastructure

and

Industrials

ETF

    

iShares

Global 100 ETF

    

iShares

Global

Infrastructure ETF

 

ASSETS

         

Investments, at value — unaffiliated(a)(b)

  $ 4,753,145     $ 4,129,578      $ 4,125,463,067      $ 3,383,373,875  

Investments, at value — affiliated(c)

    195,281       146,826        10,828,702        3,759,426  

Cash

    3,129       2,602        13,107        35,028  

Cash pledged for futures contracts

    2,000       2,000        453,000        280,000  

Foreign currency collateral pledged for futures contracts(d)

                 119,637        1,150,960  

Foreign currency, at value(e)

          5,979        2,337,737        5,471,248  

Receivables:

         

Investments sold

    39,484                     231,999,925  

Securities lending income — affiliated

    9       25        932        14,395  

Capital shares sold

                 1,333,497         

Dividends — unaffiliated

    338       10,562        3,686,762        10,022,211  

Dividends — affiliated

    19              26,680        12,987  

Tax reclaims

    21       259        1,275,403        263,941  

Variation margin on futures contracts

    50                      
 

 

 

   

 

 

    

 

 

    

 

 

 

Total assets

    4,993,476       4,297,831        4,145,538,524        3,636,383,996  
 

 

 

   

 

 

    

 

 

    

 

 

 

LIABILITIES

         

Foreign bank overdraft(f)

    18,415                      

Collateral on securities loaned, at value

    195,300       146,824        3,648,664        1,073,192  

Payables:

         

Investments purchased

    5,988       8        822,473        233,384,457  

Capital shares redeemed

                        309,839  

Investment advisory fees

    1,883       1,659        1,383,338        1,230,101  

IRS compliance fee for foreign withholding tax claims

                 1,488,716         

Professional fees

                 4,706        381,727  

Variation margin on futures contracts

          153        17,114        31,369  
 

 

 

   

 

 

    

 

 

    

 

 

 

Total liabilities

    221,586       148,644        7,365,011        236,410,685  
 

 

 

   

 

 

    

 

 

    

 

 

 

Commitments and contingent liabilities

         

NET ASSETS

  $ 4,771,890     $ 4,149,187      $ 4,138,173,513      $ 3,399,973,311  
 

 

 

   

 

 

    

 

 

    

 

 

 

NET ASSETS CONSIST OF

         

Paid-in capital

  $ 4,975,310     $ 4,016,012      $ 3,311,391,391      $ 3,879,807,564  

Accumulated earnings (loss)

    (203,420     133,175        826,782,122        (479,834,253
 

 

 

   

 

 

    

 

 

    

 

 

 

NET ASSETS

  $ 4,771,890     $ 4,149,187      $ 4,138,173,513      $ 3,399,973,311  
 

 

 

   

 

 

    

 

 

    

 

 

 

NET ASSETVALUE

         

Shares outstanding

    200,000       160,000        56,550,000        78,500,000  
 

 

 

   

 

 

    

 

 

    

 

 

 

Net asset value

  $ 23.86     $ 25.93      $ 73.18      $ 43.31  
 

 

 

   

 

 

    

 

 

    

 

 

 

Shares authorized

    Unlimited       Unlimited        Unlimited        Unlimited  
 

 

 

   

 

 

    

 

 

    

 

 

 

Par value

    None       None        None        None  
 

 

 

   

 

 

    

 

 

    

 

 

 

(a) Investments, at cost — unaffiliated

  $ 5,031,390     $ 3,999,291      $ 3,052,785,551      $ 3,509,555,051  

(b) Securities loaned, at value

  $ 190,920     $ 143,767      $ 3,478,215      $ 1,008,235  

(c)  Investments, at cost — affiliated

  $ 195,300     $ 146,826      $ 10,828,702      $ 3,758,036  

(d) Foreign currency collateral pledged, at cost

  $     $      $ 125,426      $ 1,178,084  

(e) Foreign currency, at cost

  $     $ 6,061      $ 2,355,813      $ 5,487,880  

(f)  Foreign bank overdraft, at cost

  $ 18,532     $      $      $  

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  27


 

Statements of Assets and Liabilities (unaudited) (continued)

September 30, 2023

 

   

iShares

Global

Timber &

Forestry ETF

   

iShares

Lithium

Miners and

Producers

ETF

 

 

 

ASSETS

   

Investments, at value — unaffiliated(a)(b)

  $ 198,269,247     $ 3,609,942  

Investments, at value — affiliated(c)

    3,821       459,208  

Cash

          2,389  

Cash pledged for futures contracts

    63,000       4,000  

Foreign currency, at value(d)

    5,203,729       55,991  

Receivables:

   

Investments sold

    23,256,535        

Securities lending income — affiliated

    1,948        

Dividends — unaffiliated

    234,936       723  

Dividends — affiliated

    615        

Tax reclaims

    519,008        
 

 

 

   

 

 

 

Total assets

    227,552,839       4,132,253  
 

 

 

   

 

 

 

LIABILITIES

   

Bank overdraft

    4,636,763        

Collateral on securities loaned, at value

    3,847       459,252  

Payables:

   

Investments purchased

    22,522,206        

Capital shares redeemed

    801,631        

Investment advisory fees

    68,337       1,492  

Variation margin on futures contracts

    5,390       315  
 

 

 

   

 

 

 

Total liabilities

    28,038,174       461,059  
 

 

 

   

 

 

 

Commitments and contingent liabilities

   

NET ASSETS

  $ 199,514,665     $ 3,671,194  
 

 

 

   

 

 

 

NET ASSETS CONSIST OF

   

Paid-in capital

  $ 251,309,760     $ 5,003,149  

Accumulated loss

    (51,795,095     (1,331,955
 

 

 

   

 

 

 

NET ASSETS

  $ 199,514,665     $ 3,671,194  
 

 

 

   

 

 

 

NET ASSET VALUE

   

Shares outstanding

    2,700,000       200,000  
 

 

 

   

 

 

 

Net asset value

  $ 73.89     $ 18.36  
 

 

 

   

 

 

 

Shares authorized

    Unlimited       Unlimited  
 

 

 

   

 

 

 

Par value

    None       None  
 

 

 

   

 

 

 

(a) Investments, at cost — unaffiliated

  $ 210,534,453     $ 4,771,640  

(b) Securities loaned, at value

  $ 3,625     $ 274,696  

(c) Investments, at cost — affiliated

  $ 3,823     $ 459,252  

(d) Foreign currency, at cost

  $ 5,206,857     $ 56,211  

See notes to financial statements.

 

 

28  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


 

Statements of Operations (unaudited)

Six Months Ended September 30, 2023

 

   

iShares

Copper

and Metals

Mining

ETF

 

 

 

 

(a) 

   

iShares

Environmental

Infrastructure

and

Industrials

ETF

 

 

 

 

 

 

   

iShares

Global 100

ETF

 

 

 

   

iShares

Global

Infrastructure

ETF

 

 

 

 

 

 

INVESTMENT INCOME

       

Dividends — unaffiliated

  $ 74,430     $ 62,338     $ 43,144,755     $ 94,617,853  

Dividends — affiliated

    19       27       167,704       119,354  

Interest — unaffiliated

          69       18,488       37,168  

Securities lending income — affiliated — net

    9       44       3,366       119,402  

Other income — unaffiliated

                188,648       677,858  

Foreign taxes withheld

    (2,698     (4,309     (2,231,130     (6,508,760

Foreign withholding tax claims

                1,709,951       3,261,875  

IRS compliance fee for foreign withholding tax claims

                5,747        
 

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

    71,760       58,169       43,007,529       92,324,750  
 

 

 

   

 

 

   

 

 

   

 

 

 

EXPENSES

       

Investment advisory

    6,121       10,407       7,896,653       7,781,676  

Commitment costs

          5       1,561       3,438  

Professional

                195,380       394,011  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

    6,121       10,412       8,093,594       8,179,125  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    65,639       47,757       34,913,935       84,145,625  
 

 

 

   

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

       

Net realized gain (loss) from:

       

Investments — unaffiliated

    12,878       11,586       (78,037,717     (51,247,695

Investments — affiliated

          2       2,234       (4,649

Foreign currency transactions

    (742     (496     41,717       (51,266

Futures contracts

    (2,391     1,213       1,068,337       1,139,463  

In-kind redemptions — unaffiliated(b)

                6,069,220       53,292,146  
 

 

 

   

 

 

   

 

 

   

 

 

 
    9,745       12,305       (70,856,209     3,127,999  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

       

Investments — unaffiliated

    (278,245     (276,844     229,297,060       (392,816,086

Investments — affiliated

    (19           63       (1,533

Foreign currency translations

    130       (314     (74,714     (43,412

Futures contracts

    (670     (793     (850,871     (1,320,144
 

 

 

   

 

 

   

 

 

   

 

 

 
    (278,804     (277,951     228,371,538       (394,181,175
 

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized gain (loss)

    (269,059     (265,646     157,515,329       (391,053,176
 

 

 

   

 

 

   

 

 

   

 

 

 

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS

  $ (203,420   $ (217,889   $ 192,429,264     $ (306,907,551
 

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) 

For the period from June 21, 2023 (commencement of operations) to to September 30, 2023.

(b) 

See Note 2 of the Notes to Financial Statements.

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  29


 

Statements of Operations (unaudited) (continued)

Six Months Ended September 30, 2023

 

   

iShares

Global

Timber &

Forestry ETF

 

 

 

 

   

iShares

Lithium

Miners and

Producers

ETF

 

 

 

 

(a) 

 

 

INVESTMENT INCOME

   

Dividends — unaffiliated

  $ 3,006,583     $ 22,027  

Dividends — affiliated

    7,228       313  

Securities lending income — affiliated — net

    19,461        

Foreign taxes withheld

    (117,594     (1,613
 

 

 

   

 

 

 

Total investment income

    2,915,678       20,727  
 

 

 

   

 

 

 

EXPENSES

   

Investment advisory

    419,022       5,411  

Professional

    3,782        

Commitment costs

    779        
 

 

 

   

 

 

 

Total expenses

    423,583       5,411  
 

 

 

   

 

 

 

Net investment income

    2,492,095       15,316  
 

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

   

Net realized gain (loss) from:

   

Investments — unaffiliated

    (11,079,416     (184,356

Investments — affiliated

    (11      

Foreign currency transactions

    (55,950     1,172  

Futures contracts

    70,703       (211

In-kind redemptions — unaffiliated(b)

    1,671,577        
 

 

 

   

 

 

 
    (9,393,097     (183,395
 

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

   

Investments — unaffiliated

    16,803,142       (1,161,698

Investments — affiliated

    236       (44

Foreign currency translations

    32,529       (220

Futures contracts

    (98,121     (1,914
 

 

 

   

 

 

 
    16,737,786       (1,163,876
 

 

 

   

 

 

 

Net realized and unrealized gain (loss)

    7,344,689       (1,347,271
 

 

 

   

 

 

 

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS

  $ 9,836,784     $ (1,331,955
 

 

 

   

 

 

 

 

(a) 

For the period from June 21, 2023 (commencement of operations) to to September 30, 2023.

(b)

See Note 2 of the Notes to Financial Statements.

See notes to financial statements.

 

 

30  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


 

Statements of Changes in Net Assets

 

   

iShares

Copper and

Metals

Mining ETF

   

iShares

Environmental Infrastructure and

Industrials ETF

 
    

 

 

   

 

 

 
   

Period From

06/21/23

to 09/30/23

(unaudited)

 

(a) 

 

 

   

Six Months

Ended

09/30/23

(unaudited)

 

 

 

 

   

Period From

11/01/22

to 03/31/23

 

(a) 

 

 

 

INCREASE (DECREASE) IN NET ASSETS

     

OPERATIONS

     

Net investment income

  $ 65,639     $ 47,757     $ 17,976  

Net realized gain (loss)

    9,745       12,305       (33,572

Net change in unrealized appreciation (depreciation)

    (278,804     (277,951     407,577  
 

 

 

   

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

    (203,420     (217,889     391,981  
 

 

 

   

 

 

   

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS(b)

     

Decrease in net assets resulting from distributions to shareholders

          (35,127     (5,790
 

 

 

   

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

     

Net increase in net assets derived from capital share transactions

    4,975,310             4,016,012  
 

 

 

   

 

 

   

 

 

 

NET ASSETS

     

Total increase (decrease) in net assets

    4,771,890       (253,016     4,402,203  

Beginning of period

          4,402,203        
 

 

 

   

 

 

   

 

 

 

End of period

  $ 4,771,890     $ 4,149,187     $ 4,402,203  
 

 

 

   

 

 

   

 

 

 

 

(a) 

Commencement of operations.

(b) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  31


 

Statements of Changes in Net Assets (continued)

 

   

iShares

Global 100 ETF

          

iShares

Global Infrastructure ETF

 
 

 

 

      

 

 

 
   

Six Months Ended

09/30/23

(unaudited)

   

Year Ended

03/31/23

          

Six Months Ended

09/30/23
(unaudited)

    Year Ended
03/31/23
 

 

 

INCREASE (DECREASE) IN NET ASSETS

          

OPERATIONS

          

Net investment income

  $ 34,913,935     $ 68,704,768        $ 84,145,625     $ 101,234,304  

Net realized gain (loss)

    (70,856,209     138,328,173          3,127,999       (461,244

Net change in unrealized appreciation (depreciation)

    228,371,538       (446,564,115        (394,181,175     (211,054,358
 

 

 

   

 

 

      

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

    192,429,264       (239,531,174        (306,907,551     (110,281,298
 

 

 

   

 

 

      

 

 

   

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS(a)

          

Decrease in net assets resulting from distributions to shareholders

    (39,844,361     (66,133,768        (54,439,577 )(b)      (92,664,851
 

 

 

   

 

 

      

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

          

Net increase (decrease) in net assets derived from capital share transactions

    381,435,541       66,208,396          (82,113,551     613,390,828  
 

 

 

   

 

 

      

 

 

   

 

 

 

NET ASSETS

          

Total increase (decrease) in net assets

    534,020,444       (239,456,546        (443,460,679     410,444,679  

Beginning of period

    3,604,153,069       3,843,609,615          3,843,433,990       3,432,989,311  
 

 

 

   

 

 

      

 

 

   

 

 

 

End of period

  $ 4,138,173,513     $ 3,604,153,069        $ 3,399,973,311     $ 3,843,433,990  
 

 

 

   

 

 

      

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year-end.

See notes to financial statements.

 

 

32  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


 

Statements of Changes in Net Assets (continued)

 

   

iShares

Global Timber & Forestry ETF

          

iShares

Lithium Miners

and Producers

ETF

 
 

 

 

      

 

 

 
   

Six Months

Ended

09/30/23

(unaudited)

 

 

 

 

   

Year Ended

03/31/23

 

 

      

Period From

06/21/23

to 09/30/23

(unaudited)

 

(a) 

 

 

 

 

INCREASE (DECREASE) IN NET ASSETS

        

OPERATIONS

        

Net investment income

  $ 2,492,095     $ 4,471,918        $ 15,316  

Net realized loss

    (9,393,097     (12,234,927        (183,395

Net change in unrealized appreciation (depreciation)

    16,737,786       (45,341,807        (1,163,876
 

 

 

   

 

 

      

 

 

 

Net increase (decrease) in net assets resulting from operations

    9,836,784       (53,104,816        (1,331,955
 

 

 

   

 

 

      

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS(b)

        

Decrease in net assets resulting from distributions to shareholders

    (3,848,829 )(c)      (5,674,714         
 

 

 

   

 

 

      

 

 

 

CAPITAL SHARE TRANSACTIONS

        

Net increase (decrease) in net assets derived from capital share transactions

    (8,776,643     (54,370,685        5,003,149  
 

 

 

   

 

 

      

 

 

 

NET ASSETS

        

Total increase (decrease) in net assets

    (2,788,688     (113,150,215        3,671,194  

Beginning of period

    202,303,353       315,453,568           
 

 

 

   

 

 

      

 

 

 

End of period

  $ 199,514,665     $ 202,303,353        $ 3,671,194  
 

 

 

   

 

 

      

 

 

 

 

(a) 

Commencement of operations.

(b) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c) 

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year-end.

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  33


Financial Highlights

(For a share outstanding throughout the period)

 

   

iShares

Copper and

Metals

  Mining ETF

 
 

 

 

 
   


Period From

06/21/23

to
09/30/23 (unaudited)

 

(a) 


 

 

 

Net asset value, beginning of period

  $ 25.04  
 

 

 

 

Net investment income(b)

    0.35  

Net realized and unrealized loss(c)

    (1.53
 

 

 

 

Net decrease from investment operations

    (1.18
 

 

 

 

Net asset value, end of period

  $ 23.86  
 

 

 

 

Total Return(d)

 

Based on net asset value

    (4.72 )%(e) 
 

 

 

 

Ratios to Average Net Assets(f)

 

Total expenses

    0.47 %(g) 
 

 

 

 

Net investment income

    5.04 %(g) 
 

 

 

 

Supplemental Data

 

Net assets, end of period (000)

  $ 4,772  
 

 

 

 

Portfolio turnover rate(h)

    31
 

 

 

 

 

(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.

 

 

34  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Environmental Infrastructure and Industrials ETF  
 

 

 

 
   

Six Months Ended

09/30/23

(unaudited)

 

 

 

   

Period From

11/01/22

to 03/31/23

 

(a) 

 

 

 

Net asset value, beginning of period

  $ 27.51     $ 25.10  
 

 

 

   

 

 

 

Net investment income(b)

    0.30       0.11  

Net realized and unrealized gain(c)

    (1.66     2.34  
 

 

 

   

 

 

 

Net increase from investment operations

    (1.36     2.45  
 

 

 

   

 

 

 

Distributions from net investment income(d)

    (0.22     (0.04
 

 

 

   

 

 

 

Net asset value, end of period

  $ 25.93     $ 27.51  
 

 

 

   

 

 

 

Total Return(e)

   

Based on net asset value

    (5.00 )%(f)      9.76 %(f) 
 

 

 

   

 

 

 

Ratios to Average Net Assets(g)

   

Total expenses

    0.47 %(h)      0.47 %(h) 
 

 

 

   

 

 

 

Net investment income

    2.16 %(h)      1.01 %(h) 
 

 

 

   

 

 

 

Supplemental Data

   

Net assets, end of period (000)

  $ 4,149     $ 4,402  
 

 

 

   

 

 

 

Portfolio turnover rate(i)

    6     13
 

 

 

   

 

 

 

 

(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.

 

 

I N A N C I A L    I G H L I G H T  S

  35


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Global 100 ETF  
 

 

 

 
   

Six Months Ended
09/30/23
(unaudited)
 
 
 
   
Year Ended
03/31/23
 
 
   
Year Ended
03/31/22
 
 
   
Year Ended
03/31/21
 
 
   
Year Ended
03/31/20
 
 
   
Year Ended
03/31/19
 
(a)  

 

 

Net asset value, beginning of period

  $ 70.05     $ 75.96     $ 65.92     $ 44.71     $ 47.57     $ 45.54  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income(b)

    0.66 (c)      1.30 (c)      1.16       0.99       1.06       1.14  

Net realized and unrealized gain (loss)(d)

    3.23       (5.93     10.08       21.16       (2.83     1.97  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) from investment operations

    3.89       (4.63     11.24       22.15       (1.77     3.11  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Distributions from net investment income(e)

    (0.76     (1.28     (1.20     (0.94     (1.09     (1.08
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net asset value, end of period

  $ 73.18     $ 70.05     $ 75.96     $ 65.92     $ 44.71     $ 47.57  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Return(f)

           

Based on net asset value

    5.57 %(c)(g)      (6.02 )%(c)      17.11     49.88     (3.91 )%      7.00
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratios to Average Net Assets(h)

           

Total expenses

    0.41 %(i)      0.41     0.40     0.40     0.40     0.40
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses excluding professional fees for foreign withholding tax claims

    0.40 %(i)      0.40     0.40     N/A       0.40     N/A  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    1.77 %(c)(i)      1.95 %(c)      1.58     1.71     2.11     2.46
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Supplemental Data

           

Net assets, end of period (000)

  $ 4,138,174     $ 3,604,153     $ 3,843,610     $ 2,973,065     $ 1,855,568     $ 2,031,281  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Portfolio turnover rate(j)

    15     2     2     3     5     9
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Per share amounts reflect a two-for-one stock split effective after the close of trading on May 1, 2018.

(b)

Based on average shares outstanding.

(c)

Reflects the positive effect of foreign withholding tax claims, net of the associated professional fees, which resulted in the following increases for the six months ended September 30, 2023 and year ended March 31, 2023 respectively:

   

Net investment income per share by $0.03 and $0.06.

   

Total return by 0.01% and 0.08%.

   

Ratio of net investment income to average net assets by 0.04% and 0.09%.

(d)

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.

(e)

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(f)

Where applicable, assumes the reinvestment of distributions.

(g)

Not annualized.

(h)

Excludes fees and expenses incurred indirectly as a result of investments in underlying funds.

(i)

Annualized.

(j)

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

36  

2 0 2 3    H A R E S     E M I - A N N U A L    E P O R T    T O     H A R E H O L D E R S


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Global Infrastructure ETF  
 

 

 

 
   

Six Months Ended
09/30/23
(unaudited)
 
 
 
   
Year Ended
03/31/23
 
 
   
Year Ended
03/31/22
 
 
   
Year Ended
03/31/21
 
 
   
Year Ended
03/31/20
 
 
   
Year Ended
03/31/19
 
 

 

 

Net asset value, beginning of period

  $ 47.69     $ 50.78     $ 45.05     $ 33.89     $ 44.78     $ 42.73  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income(a)

    1.04 (b)      1.33       1.04       1.04       1.54       1.34  

Net realized and unrealized gain (loss)(c)

    (4.74     (3.20     5.84       11.14       (10.86     2.10  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) from investment operations

    (3.70     (1.87     6.88       12.18       (9.32     3.44  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Distributions from net investment income(d)

    (0.68 )(e)      (1.22     (1.15     (1.02     (1.57     (1.39
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net asset value, end of period

  $ 43.31     $ 47.69     $ 50.78     $ 45.05     $ 33.89     $ 44.78  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Return(f)

           

Based on net asset value

    (7.85 )%(b)(g)      (3.74 )%(b)      15.54     36.27 %(h)      (21.75 )%      8.40
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratios to Average Net Assets(i)

           

Total expenses

    0.43 %(j)      0.41     0.40     0.43     0.46     0.46
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses excluding professional fees for foreign withholding tax claims

    0.41 %(j)      0.41     N/A       N/A       N/A       N/A  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    4.43 %(b)(j)      2.81 %(b)      2.23     2.57     3.38     3.15
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Supplemental Data

           

Net assets, end of period (000)

  $ 3,399,973     $ 3,843,434     $ 3,432,989     $ 3,063,620     $ 2,741,647     $ 2,825,830  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Portfolio turnover rate(k)

    7     19     16     25     9     19
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Based on average shares outstanding.

(b)

Reflects the positive effect of foreign withholding tax claims, net of the associated professional fees, which resulted in the following increases for the six months ended September 30, 2023 and year ended March 31, 2023 respectively:

   

Net investment income per share by $0.04.

   

Total return by 0.08% and 0.01%.

   

Ratio of net investment income to average net assets by 0.08% and 0.01%.

(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)

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year-end.

(f)

Where applicable, assumes the reinvestment of distributions.

(g)

Not annualized.

(h)

Includes payment received from an affiliate, which had no impact on the Fund’s total return.

(i)

Excludes fees and expenses incurred indirectly as a result of investments in underlying funds.

(j)

Annualized.

(k)

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

 

I N A N C I A L    I G H L I G H T  S

  37


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Global Timber & Forestry ETF  
 

 

 

 
   

Six Months Ended
09/30/23
(unaudited)
 
 
 
   
Year Ended
03/31/23
 
 
   
Year Ended
03/31/22
 
 
   
Year Ended
03/31/21
 
 
   
Year Ended
03/31/20
 
 
   
Year Ended
03/31/19
 
 

 

 

Net asset value, beginning of period

  $ 71.74     $ 89.11     $ 85.14     $ 48.10     $ 63.82     $ 78.11  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income(a)

    0.88       1.40 (b)      1.58 (b)      0.78       0.79       1.57  

Net realized and unrealized gain (loss)(c)

    2.61       (17.13     3.53       37.04       (15.27     (14.25
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) from investment operations

    3.49       (15.73     5.11       37.82       (14.48     (12.68
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Distributions from net investment income(d)

    (1.34 )(e)      (1.64     (1.14     (0.78     (1.24     (1.61
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net asset value, end of period

  $ 73.89     $ 71.74     $ 89.11     $ 85.14     $ 48.10     $ 63.82  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Return(f)

           

Based on net asset value

    4.92 %(g)      (17.90 )%(b)      6.04 %(b)      79.23     (23.04 )%      (16.22 )% 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratios to Average Net Assets(h)

           

Total expenses

    0.41 %(i)      0.42     0.41     0.43     0.46     0.46
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses excluding professional fees for foreign withholding tax claims

    0.41 %(i)      0.41     0.40     N/A       N/A       0.46
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    2.43 %(i)      1.81 %(b)      1.78 %(b)      1.15     1.30     2.17
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Supplemental Data

           

Net assets, end of period (000)

  $ 199,515     $ 202,303     $ 315,454     $ 332,050     $ 173,178     $ 279,553  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Portfolio turnover rate(j)

    19     29     18     14     10     18
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Based on average shares outstanding.

(b)

Reflects the positive effect of foreign withholding tax claims, net of the associated professional fees, which resulted in the following increases for the years ended March 31, 2022 and March 31, 2023, respectively:

   

Net investment income per share by $0.07 and $0.05.

   

Total return by 0.09% and 0.07%.

   

Ratio of net investment income to average net assets by 0.07% and 0.06%.

(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)

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year-end.

(f)

Where applicable, assumes the reinvestment of distributions.

(g)

Not annualized.

(h)

Excludes fees and expenses incurred indirectly as a result of investments in underlying funds.

(i)

Annualized.

(j)

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

38  

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Financial Highlights (continued)

(For a share outstanding throughout the period)

 

   

iShares

Lithium

Miners and

Producers

ETF

 
 

 

 

 
   


Period From

06/21/23

to
09/30/23 (unaudited)

 

(a) 


 

 

 

Net asset value, beginning of period

  $ 24.94  
 

 

 

 

Net investment income(b)

    0.08  

Net realized and unrealized loss(c)

    (6.66
 

 

 

 

Net decrease from investment operations

    (6.58
 

 

 

 

Net asset value, end of period

  $ 18.36  
 

 

 

 

Total Return(d)

 

Based on net asset value

    (26.41 )%(e) 
 

 

 

 

Ratios to Average Net Assets(f)

 

Total expenses

    0.47 %(g) 
 

 

 

 

Net investment income

    1.33 %(g) 
 

 

 

 

Supplemental Data

 

Net assets, end of period (000)

  $ 3,671  
 

 

 

 

Portfolio turnover rate(h)

    17
 

 

 

 

 

(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.

 

 

I N A N C I A L    I G H L I G H T  S

  39


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    

Copper and Metals Mining(a)

  Non-diversified    

Environmental Infrastructure and Industrials

  Non-diversified    

Global 100(b)

  Diversified    

Global Infrastructure

  Diversified    

Global Timber & Forestry

  Non-diversified    

Lithium Miners and Producers(a)

  Non-diversified    

 

  (a) 

The Funds commenced operations on June 21, 2023.

  (b) 

The Fund intends to be diversified in approximately the same proportion as its underlying index is diversified. The Fund may become non-diversified, as defined in the 1940 Act, solely as a result of a change in relative market capitalization or index weighting of one or more constituents of its underlying index. Shareholder approval will not be sought if the Fund crosses from diversified to non-diversified status due solely to a change in its relative market capitalization or index weighting of one or more constituents of its underlying index.

 

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 September 30, 2023, 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.

Bank Overdraft: The Funds had outstanding cash disbursements exceeding deposited cash amounts at the custodian and utilized its ability to temporarily borrow from that custodian for operational purposes. The Funds are obligated to repay the custodian for any overdraft, including any related costs or expenses, where applicable.

Collateralization: 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.

 

 

40  

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Notes to Financial Statements (unaudited) (continued)

 

In-kind Redemptions: For financial reporting purposes, in-kind redemptions are treated as sales of securities resulting in realized capital gains or losses to the Funds. Because such gains or losses are not taxable to the Funds and are not distributed to existing Fund shareholders, the gains or losses are reclassified from accumulated net realized gain (loss) to paid-in capital at the end of the Funds’ tax year. These reclassifications have no effect on net assets or net asset value (“NAV”) per share.

Distributions: Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds.

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. The Board of Trustees of the Trust (the “Board”) of each Fund has approved the designation of BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, as the valuation designee for each Fund. Each Fund determines the fair values of its financial instruments using various independent dealers or pricing services under BFA’s policies. 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 BFA’s policies and procedures as reflecting fair value. BFA has formed a committee (the “Valuation Committee”) to develop pricing policies and procedures and to oversee the pricing function for all financial instruments, with assistance from other BlackRock pricing committees.

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 Valuation Committee, in accordance with BFA’s policies and procedures as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the 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 Valuation Committee 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 Valuation Committee deems relevant and consistent with the principles of fair value measurement.

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 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

 

 

O T E S  T O    I N A N C I A L     T A T E M E N T S

  41


Notes to Financial Statements  (unaudited) (continued)

 

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 Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

 

4.

SECURITIES AND OTHER INVESTMENTS

Securities Lending: Each Fund may lend its securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by an approved bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund or excess collateral is returned by the Fund, on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities but does not receive interest income on securities received as collateral. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.

As of period end, any securities on loan were collateralized by cash and/or U.S. Government obligations. Cash collateral invested in money market funds managed by BFA, or its affiliates is disclosed in the Schedule of Investments. Any non-cash collateral received cannot be sold, re-invested or pledged by the Fund, except in the event of borrower default. The securities on loan, if any, are also disclosed in each Fund’s Schedule of Investments. The market value of any securities on loan and the value of any related cash collateral are disclosed in the Statements of Assets and Liabilities.

Securities lending transactions are entered into by the Funds under Master Securities Lending Agreements (each, an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the Funds, as lender, would offset the market value of the collateral received against the market value of the securities loaned. When the value of the collateral is greater than that of the market value of the securities loaned, the lender is left with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell or re-pledge the loaned securities, and the Funds can reinvest cash collateral received in connection with loaned securities. Upon an event of default, the parties’ obligations to return the securities or collateral to the other party are extinguished, and the parties can resell or re-pledge the loaned securities or the collateral received in connection with the loaned securities in order to satisfy the defaulting party’s net payment obligation for all transactions under the MSLA. The defaulting party remains liable for any deficiency.

As of period end, the following table is a summary of the securities on loan by counterparty which are subject to offset under an MSLA:

 

iShares ETF and Counterparty    

Securities Loaned

at Value

 

 

    

Cash Collateral

Received

 

(a) 

   

Non-Cash Collateral

Received, at Fair Value

 

(a) 

    Net Amount  

Copper and Metals Mining

        

UBS AG

  $ 190,920      $ (190,920   $     $  
 

 

 

    

 

 

   

 

 

   

 

 

 

Environmental Infrastructure and Industrials

        

RBC Capital Markets LLC

  $ 143,767      $ (143,767   $     $  
 

 

 

    

 

 

   

 

 

   

 

 

 

Global 100

        

Goldman Sachs & Co. LLC

  $ 3,478,215      $ (3,478,215   $     $  
 

 

 

    

 

 

   

 

 

   

 

 

 

Global Infrastructure

        

BofA Securities, Inc.

  $ 371,271      $ (371,271   $     $  

HSBC Bank PLC

    40,196        (40,196            

Morgan Stanley

    584,648        (584,648            

Wells Fargo Securities LLC

    12,120        (11,955           165 (b) 
 

 

 

    

 

 

   

 

 

   

 

 

 
  $ 1,008,235      $ (1,008,070)     $     $ 165  
 

 

 

    

 

 

   

 

 

   

 

 

 

Global Timber & Forestry

        

Nomura Securities International Inc.

  $ 3,625      $ (3,625   $     $  
 

 

 

    

 

 

   

 

 

   

 

 

 

Lithium Miners and Producers

        

BofA Securities, Inc.

  $ 274,696      $ (274,696   $     $  
 

 

 

    

 

 

   

 

 

   

 

 

 

 

  (a) 

Collateral received, if any, in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by each Fund is disclosed in the Fund’s Statements of Assets and Liabilities.

 
  (b) 

The market value of the loaned securities is determined as of September 30, 2023. Additional collateral is delivered to the Fund on the next business day in accordance with the MSLA. The net amount would be subject to the borrower default indemnity in the event of default by a counterparty.

 

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, each Fund benefits from a borrower default indemnity provided by BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of the securities loaned to the extent the collateral received does not cover the value of the securities loaned in the event of borrower default. Each Fund could incur a loss if the

 

 

42  

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Notes to Financial Statements (unaudited) (continued)

 

value of an investment purchased with cash collateral falls below the market value of the loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received. Such losses are borne entirely by each Fund.

 

5.

DERIVATIVE FINANCIAL INSTRUMENTS

Futures Contracts: 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.

 

6.

INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Advisory Fees: Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to BFA; and (v) litigation expenses and any extraordinary expenses (in each case as determined by a majority of the independent trustees).

For its investment advisory services to each of the following Funds, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on the average daily net assets of each Fund as follows:

 

 

iShares ETF

 

 

 

Investment Advisory Fees

 

 

Copper and Metals Mining

    0.47

Environmental Infrastructure and Industrials

    0.47  

Global 100

    0.40  

Lithium Miners and Producers

 

   

 

0.47

 

 

 

For its investment advisory services to each of the iShares Global Infrastructure and iShares Global Timber & Forestry ETFs, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Funds, based on each Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds as follows:

 

 

Aggregate Average Daily Net Assets

 

 

 

Investment Advisory Fees

 

 

First $10 billion

    0.4800

Over $10 billion, up to and including $20 billion

    0.4300  

Over $20 billion, up to and including $30 billion

    0.3800  

Over $30 billion, up to and including $40 billion

    0.3420  

Over $40 billion

 

   

 

0.3078

 

 

 

Distributor: BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.

Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending, including any custodial costs. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution

 

 

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Notes to Financial Statements (unaudited) (continued)

 

fee or service fee. The money market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.

Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. Each Fund retains a portion of securities lending income and remits the remaining portion to BTC as compensation for its services as securities lending agent.

Pursuant to the current securities lending agreement, the iShares Global 100 ETF (the “Group 1 Fund”), retains 81% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

Pursuant to the current securities lending agreement, the iShares Copper and Metals Mining ETF, iShares Environmental Infrastructure and Industrials ETF, iShares Global Infrastructure ETF, iShares Global Timber & Forestry ETF and iShares Lithium Miners and Producers ETF (the “Group 2 Fund”), retains 82% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in a given calendar year exceeds a specified threshold: (1) the Group 1 Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year 81% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees, and (2) each Group 2 Fund will retain for the remainder of that calendar year 85% of securities lending income (which excludes collateral investment fees), and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

The share of securities lending income earned by each Fund is shown as securities lending income – affiliated – net in its Statements of Operations. For the six months ended September 30, 2023, the Funds paid BTC the following amounts for securities lending agent services:

 

 

iShares ETF

 

 

 

Amounts

 

 

Copper and Metals Mining

  $ 2  

Environmental Infrastructure and Industrials

    18  

Global 100

    1,101  

Global Infrastructure

    28,646  

Global Timber & Forestry

    4,415  

Lithium Miners and Producers

    4  

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 September 30, 2023, 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)

 

Global 100

  $   219,322,709      $   122,773,499      $ (16,077,682

Global Infrastructure

    4,687,454        11,227,921        (1,800,266

Global Timber & Forestry

    990,331        2,096,572        (88,857

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.

 

 

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Notes to Financial Statements (unaudited) (continued)

 

7.

PURCHASES AND SALES

For the six months ended September 30, 2023, purchases and sales of investments, excluding short-term securities and in-kind transactions, were as follows:

 

iShares ETF   Purchases      Sales  

Copper and Metals Mining

  $ 1,978,168      $ 1,384,834  

Environmental Infrastructure and Industrials

    275,944        268,704  

Global 100

     627,525,728         605,269,090  

Global Infrastructure

    336,570,528        261,866,706  

Global Timber & Forestry

    38,542,147        39,920,354  

Lithium Miners and Producers

    1,954,310        670,726  

For the six months ended September 30, 2023, in-kind transactions were as follows:

 

iShares ETF   In-kind
Purchases
    

In-kind

Sales

 

Copper and Metals Mining

  $ 4,425,178      $  

Global 100

     364,481,098        10,386,993  

Global Infrastructure

    221,590,504         330,809,604  

Global Timber & Forestry

    11,153,959        18,723,169  

Lithium Miners and Producers

    3,672,411         

 

8.

INCOME TAX INFORMATION

Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.

Management has analyzed tax laws and regulations and their application to the Funds as of September 30, 2023, 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 March 31, 2023, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:

 

iShares ETF  

Non-Expiring

Capital Loss

Carryforwards

 

Environmental Infrastructure and Industrials

  $ (33,072

Global 100

    (138,980,093

Global Infrastructure

    (370,265,257

Global Timber & Forestry

    (27,091,323

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 September 30, 2023, 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)
 

Copper and Metals Mining

  $ 5,226,690      $ 25,088      $ (304,022    $ (278,934

Environmental Infrastructure and Industrials

    4,147,081        389,933        (261,058      128,875  

Global 100

    3,109,098,065        1,180,337,145        (153,503,604      1,026,833,541  

Global Infrastructure

    3,546,555,574        193,928,183        (353,648,321      (159,720,138

Global Timber & Forestry

    212,331,555        14,789,818        (28,880,166      (14,090,348

Lithium Miners and Producers

    5,230,892        625        (1,164,281      (1,163,656

 

9.

LINE OF CREDIT

The Funds, along with certain other iShares funds (“Participating Funds”), are parties to a $800 million credit agreement (“Syndicated Credit Agreement”) with a group of lenders, which expires on August 9, 2024. 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

 

 

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Notes to Financial Statements (unaudited) (continued)

 

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) Daily Simple Secured Overnight Financing Rate (“SOFR”) plus 0.10% and 1.00% per annum or (b) the U.S. Federal Funds rate 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 September 30, 2023, the Funds did not borrow under the Syndicated Credit Agreement.

 

10.

PRINCIPAL RISKS

In the normal course of business, each Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including, among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate or price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Funds and their investments. Each Fund’s prospectus provides details of the risks to which the Fund is subject.

BFA uses a “passive” or index approach to try to achieve each Fund’s investment objective following the securities included in its underlying index during upturns as well as downturns. BFA does not take steps to reduce market exposure or to lessen the effects of a declining market. Divergence from the underlying index and the composition of the portfolio is monitored by BFA.

The Funds may be exposed to additional risks when reinvesting cash collateral in money market funds that do not seek to maintain a stable NAV per share of $1.00, which may be subject to redemption gates or liquidity fees under certain circumstances.

Infectious Illness Risk: An outbreak of an infectious illness, such as the COVID-19 pandemic, may adversely impact the economies of many nations and the global economy, and may impact individual issuers and capital markets in ways that cannot be foreseen. An infectious illness outbreak may result in, among other things, closed international borders, prolonged quarantines, supply chain disruptions, market volatility or disruptions and other significant economic, social and political impacts.

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 BFA 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.

Geographic/Asset Class 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 securities of issuers located in the United States. A decrease in imports or exports, changes in trade regulations, inflation and/or an economic recession in the United States may have a material adverse effect on the U.S. economy and the securities listed on U.S. exchanges. Proposed and adopted policy and legislative changes in the United States may also have a significant effect on U.S. markets generally, as well as on the value of certain securities.

 

 

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Notes to Financial Statements (unaudited) (continued)

 

Governmental agencies project that the United States will continue to maintain elevated public debt levels for the foreseeable future which may constrain future economic growth. Circumstances could arise that could prevent the timely payment of interest or principal on U.S. government debt, such as reaching the legislative “debt ceiling.” Such non-payment would result in substantial negative consequences for the U.S. economy and the global financial system. If U.S. relations with certain countries deteriorate, it could adversely affect issuers that rely on the United States for trade. The United States has also experienced increased internal unrest and discord. If these trends were to continue, they may have an adverse impact on the U.S. economy and the issuers in which the the Funds invest.

Certain Funds invest a significant portion of their assets in securities of issuers located in Europe or with significant exposure to European issuers or countries. The European financial markets have recently experienced volatility and adverse trends due to concerns about economic downturns in, or rising government debt levels of, several European countries as well as acts of war in the region. These events may spread to other countries in Europe and may affect the value and liquidity of certain of the Funds’ investments.

Responses to the financial problems by European governments, central banks and others, including austerity measures and reforms, may not work, may result in social unrest and may limit future growth and economic recovery or have other unintended consequences. Further defaults or restructurings by governments and others of their debt could have additional adverse effects on economies, financial markets and asset valuations around the world. The United Kingdom has withdrawn from the European Union, and one or more other countries may withdraw from the European Union and/or abandon the Euro, the common currency of the European Union. These events and actions have adversely affected, and may in the future adversely affect, the value and exchange rate of the Euro and may continue to significantly affect the economies of every country in Europe, including countries that do not use the Euro and non-European Union member states. The impact of these actions, especially if they occur in a disorderly fashion, is not clear but could be significant and far reaching. In addition, Russia launched a large-scale invasion of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting future market disruptions in the region are impossible to predict, but have been, and may continue to be significant and have a severe adverse effect on the region, including significant negative impacts on the economy and the markets for certain securities and commodities, such as oil and natural gas, as well as other sectors.

Certain Funds invest a significant portion of their assets in securities within a single or limited number of market sectors. When a fund concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio.

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.

 

11.

CAPITAL SHARE TRANSACTIONS

Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable.

Transactions in capital shares were as follows:

 

 

 
                                

Period Ended

09/30/23

 
     

 

 

 
iShares ETF                          Shares          Amount  

 

 

Copper and Metals Mining(a)

               

Shares sold

             200,000        $ 4,975,310  
          

 

 

      

 

 

 

 

  (a)

The Fund commenced operations on June 21, 2023.

 

 

 

 
    Six Months Ended
09/30/23
          

Period Ended

03/31/23

 
                  
iShares ETF   Shares             Amount            Shares            Amount  

 

 

Environmental Infrastructure and Industrials(a)

                 

Shares sold

            $          160,000        $ 4,016,012  
 

 

 

       

 

 

      

 

 

      

 

 

 

 

  (a)

The Fund commenced operations on November 01, 2022.

 

 

 

 
   

Six Months Ended

09/30/23

       

Year Ended

03/31/23

 
 

 

 

     

 

 

 
iShares ETF   Shares          Amount         Shares          Amount  

 

 

Global 100

               

Shares sold

    5,250,000        $ 392,203,839              5,700,000        $ 385,994,005  

Shares redeemed

    (150,000        (10,768,298       (4,850,000        (319,785,609
 

 

 

      

 

 

     

 

 

      

 

 

 
    5,100,000        $ 381,435,541         850,000        $ 66,208,396  
 

 

 

      

 

 

     

 

 

      

 

 

 

 

 

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Notes to Financial Statements (unaudited) (continued)

 

 

 
   

Six Months Ended

09/30/23

          

Year Ended

03/31/23

 
 

 

 

      

 

 

 
iShares ETF   Shares            Amount            Shares            Amount  

 

 

Global Infrastructure

                

Shares sold

    5,500,000        $  252,546,083          21,600,000        $  1,019,069,803  

Shares redeemed

    (7,600,000        (334,659,634        (8,600,000        (405,678,975
 

 

 

      

 

 

      

 

 

      

 

 

 
    (2,100,000      $ (82,113,551        13,000,000        $ 613,390,828  
 

 

 

      

 

 

      

 

 

      

 

 

 

Global Timber & Forestry

                

Shares sold

    180,000        $ 13,009,832                 $ (1,137

Shares redeemed

    (300,000        (21,786,475        (720,000        (54,369,548
 

 

 

      

 

 

      

 

 

      

 

 

 
    (120,000      $ (8,776,643        (720,000      $ (54,370,685
 

 

 

      

 

 

      

 

 

      

 

 

 

 

 

 
                               

Period Ended

09/30/23

 
       

 

 

 
iShares ETF                               Shares             Amount  

 

 

Lithium Miners and Producers(a)

                   

Shares sold

                200,000         $ 5,003,149  
             

 

 

       

 

 

 

 

  (a) 

The Fund commenced operations on June 21, 2023.

 

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.

 

12.

FOREIGN WITHHOLDING TAX CLAIMS

The Internal Revenue Service (“IRS”) has issued guidance to address U.S. income tax liabilities attributable to fund shareholders resulting from the recovery of foreign taxes withheld in prior calendar years. These withheld foreign taxes were passed through to shareholders in the form of foreign tax credits in the year the taxes were withheld. Assuming there are sufficient foreign taxes paid which the iShares Global Infrastructure ETF is able to pass through to shareholders as a foreign tax credit in the current year, the Fund will be able to offset the prior years’ withholding taxes recovered against the foreign taxes paid in the current year. Accordingly, no federal income tax liability is recorded by the Fund.

The iShares Global 100 ETF is seeking a closing agreement with the Internal Revenue Service (“IRS”) to address any prior years’ U.S. income tax liabilities attributable to Fund shareholders resulting from the recovery of foreign taxes. The closing agreement would result in the Fund paying a compliance fee to the IRS, on behalf of its shareholders, representing the estimated tax savings generated from foreign tax credits claimed by Fund shareholders on their tax returns in prior years. The Fund has accrued a liability for the estimated IRS compliance fee related to foreign withholding tax claims, which is disclosed in the Statement of Assets and Liabilities. The actual IRS compliance fee may differ from the estimate and that difference may be material.

 

13.

SUBSEQUENT EVENTS

Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were available to be issued and the following item was noted:

Effective October 18, 2023, the Syndicated Credit Agreement to which the Participating Funds are party was amended to extend the maturity date to October 2024 under the same terms.

 

 

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Board Review and Approval of Investment Advisory Contract

 

iShares Copper and Metals Mining ETF, iShares Lithium Miners and Producers ETF (each the “Fund”)

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members”), is required to consider and approve the proposed Investment Advisory Agreement between the Trust and BFA (the “Advisory Agreement”) on behalf of the Fund. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the terms of the proposed Advisory Agreement. At a meeting held on March 29-30, 2023, the Board, including the Independent Board Members, approved the selection of BFA as investment adviser and approved the proposed Advisory Agreement 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 Agreement 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; (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 Agreement 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 expense peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances.

The Board also noted that the investment advisory fee rate and overall expenses (net of any waivers and reimbursements) for the Fund were lower than the median of the investment advisory fee rates and overall 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 Agreement.

Nature, Extent and Quality of Services to be Provided by BFA: The Board reviewed the scope of services to be provided by BFA under the Advisory Agreement. 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 appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons 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, and other matters related to BFA’s portfolio compliance program.

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 Agreement supported the Board’s approval of the Advisory Agreement.

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 Agreement 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 potential 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 Agreement 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 Agreement.

Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board received and considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board

 

 

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Board Review and Approval of Investment Advisory Contract  (continued)

 

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 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 also reviewed and considered information provided by BFA concerning authorized participant primary market order processing services that will be provided by BlackRock Investments, LLC (“BRIL”), an affiliate of BFA, and paid for by authorized participants under the ETF Servicing Platform. 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 Agreement.

Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Agreement 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 Agreement.

iShares Global 100 ETF (the “Fund”)

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members”), is required annually to consider the approval of the Investment Advisory Agreement between the Trust and BFA (the “Advisory Agreement”) on behalf of the Fund. The Board’s consideration entails a year-long process whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Agreement. At meetings on May 2, 2023 and May 15, 2023, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 7-8, 2023, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.

After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Agreement for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Agreement for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Agreement are discussed below.

Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of other fund(s) in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs, objectively selected by Broadridge as comprising the Fund’s applicable expense peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the investment advisory fee rate and overall expenses (net of any waivers and reimbursements) for the Fund were lower than the median of the investment advisory fee rates and overall expenses (net of any waivers and reimbursements) of the funds in its Peer Group, excluding iShares funds.

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2022, to that of such relevant comparison fund(s) for the same periods. The Board noted that the Fund seeks to track its specified underlying

 

 

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Board Review and Approval of Investment Advisory Contract  (continued)

 

index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.

Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about ongoing enhancements and initiatives with respect to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Agreement for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund, including related programs implemented pursuant to regulatory requirements. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies provided at the May 2, 2023 meeting and throughout the year, and matters related to BFA’s portfolio compliance program and other compliance programs and services.

Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Agreement supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Agreement), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).

Based on this review, the Board concluded that the information considered with respect to the profits realized by BFA and its affiliates under the Advisory Agreement and from other relationships between the Fund and BFA and/or its affiliates, if any, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability (as discussed above), including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Agreement for the Fund did not provide for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board noted that it would continue to assess the appropriateness of adding breakpoints in the future.

The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board received and considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts.

The Board received detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and

 

 

O A R D    E V I E W    A N D     P P R O V A L    O F    N V E S T M E N T    A D V I S O R Y    O N T R A C T

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Board Review and Approval of Investment Advisory Contract  (continued)

 

strategy as the Fund and that track the same index as the Fund. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate.

The Board considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement and noted that the investment advisory fee rate under the Advisory Agreement for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.

Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, including, but not limited to, payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities, as applicable (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services, and BlackRock’s profile in the investment community. The Board further considered other direct benefits that might accrue to BFA, including the potential for reduction in the Fund’s expenses that are borne by BFA under the “all-inclusive” management fee arrangement, due in part to the size and scope of BFA’s investment operations servicing the Fund (and other funds in the iShares complex) as well as in response to a changing market environment. The Board also reviewed and considered information provided by BFA concerning authorized participant primary market order processing services that are provided by BlackRock Investments, LLC (“BRIL”), an affiliate of BFA, and paid for by authorized participants under the ETF Servicing Platform. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Agreement for the coming year.

Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Agreement does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Agreement for the coming year.

iShares Global Infrastructure ETF, iShares Global Timber & Forestry ETF (each the “Fund”)

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members”), is required annually to consider the approval of the Investment Advisory Agreement between the Trust and BFA (the “Advisory Agreement”) on behalf of the Fund. The Board’s consideration entails a year-long process whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Agreement. At meetings on May 2, 2023 and May 15, 2023, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 7-8, 2023, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.

After extensive discussions and deliberations, the Board, including all of the Independent Board Members, approved the continuance of the Advisory Agreement for the Fund, based on a review of qualitative and quantitative information provided by BFA and their cumulative experience as Board Members. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Independent Board Members were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the continuance of the Advisory Agreement for the Fund, the Board, including the Independent Board Members, considered various factors, including: (i) the expenses and performance of the Fund; (ii) the nature, extent and quality of the services provided by BFA; (iii) the costs of services provided to the Fund and profits realized by BFA and its affiliates; (iv) potential economies of scale and the sharing of related benefits; (v) the fees and services provided for other comparable funds/accounts managed by BFA and its affiliates; and (vi) other benefits to BFA and/or its affiliates. The material factors, none of which was controlling, and conclusions that formed the basis for the Board, including the Independent Board Members, to approve the continuance of the Advisory Agreement are discussed below.

Expenses and Performance of the Fund: The Board reviewed statistical information prepared by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, fees and expenses of other fund(s) in which the Fund invests (if applicable), and waivers/reimbursements (if applicable) of the Fund in comparison with the same information for other ETFs, objectively selected by Broadridge as comprising the Fund’s applicable expense peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of the proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board noted that, due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances. The Board also noted that the investment advisory fee rate and overall expenses (net of any waivers and reimbursements) for the Fund were lower than the median of the investment advisory fee rates and overall expenses (net of any waivers and reimbursements) of the funds in its Peer Group, excluding iShares funds.

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2022, to that of such relevant comparison fund(s) for the same periods. The Board noted that the Fund seeks to track its specified underlying

 

 

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Board Review and Approval of Investment Advisory Contract  (continued)

 

index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.

Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Nature, Extent and Quality of Services Provided: Based on management’s representations, including information about ongoing enhancements and initiatives with respect to the iShares business, including with respect to capital markets support and analysis, technology, portfolio management, product design and quality, compliance and risk management, global public policy and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Agreement for the coming year as compared with the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to support the iShares funds and their shareholders and have made significant investments into the iShares business. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund, including related programs implemented pursuant to regulatory requirements. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made relevant officers and other employees of BFA (and its affiliates) available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies provided at the May 2, 2023 meeting and throughout the year, and matters related to BFA’s portfolio compliance program and other compliance programs and services.

Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided to the Fund under the Advisory Agreement supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Agreement), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).

Based on this review, the Board concluded that the information considered with respect to the profits realized by BFA and its affiliates under the Advisory Agreement and from other relationships between the Fund and BFA and/or its affiliates, if any, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Economies of Scale: The Board reviewed information and considered the extent to which economies of scale might be realized as the assets of the Fund increase, noting that the issue of potential economies of scale had been focused on by the 15(c) Committee and the Board during their meetings and addressed by management. The 15(c) Committee and the Board received information regarding BlackRock’s historical estimated profitability (as discussed above), including BFA’s and its affiliates’ estimated costs in providing services. The estimated cost information distinguished, among other things, between fixed and variable costs, and showed how the level and nature of fixed and variable costs may impact the existence or size of scale benefits, with the Board recognizing that potential economies of scale are difficult to measure. The 15(c) Committee and the Board reviewed information provided by BFA regarding the sharing of scale benefits with the iShares funds through various means, including, as applicable, through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board noted that the Advisory Agreement for the Fund already provided for breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund, on an aggregated basis with the assets of certain other iShares funds, increase. The Board noted that it would continue to assess the appropriateness of adding new or revised breakpoints in the future.

The Board concluded that this review of potential economies of scale and the sharing of related benefits, as well as the other factors considered at the meeting, supported the Board’s approval of the continuance of the Advisory Agreement for the coming year.

Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates: The Board received and considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds and institutional separate accounts (collectively, the “Other Accounts”). The Board acknowledged BFA’s representation that the iShares funds are fundamentally different investment vehicles from the Other Accounts.

The Board received detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and

 

 

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Board Review and Approval of Investment Advisory Contract  (continued)

 

strategy as the Fund and that track the same index as the Fund. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate.

The Board considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund’s expenses borne by BFA under this arrangement and noted that the investment advisory fee rate under the Advisory Agreement for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.

Other Benefits to BFA and/or its Affiliates: The Board reviewed other benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Fund by BFA, both direct and indirect, including, but not limited to, payment of revenue to BTC, the Fund’s securities lending agent, for loaning portfolio securities, as applicable (which was included in the profit margins reviewed by the Board pursuant to BFA’s estimated profitability methodology), payment of advisory fees or other fees to BFA (or its affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services or other services, and BlackRock’s profile in the investment community. The Board further considered other direct benefits that might accrue to BFA, including the potential for reduction in the Fund’s expenses that are borne by BFA under the “all-inclusive” management fee arrangement, due in part to the size and scope of BFA’s investment operations servicing the Fund (and other funds in the iShares complex) as well as in response to a changing market environment. The Board also reviewed and considered information provided by BFA concerning authorized participant primary market order processing services that are provided by BlackRock Investments, LLC (“BRIL”), an affiliate of BFA, and paid for by authorized participants under the ETF Servicing Platform. The Board also noted the revenue received by BFA and/or its affiliates pursuant to an agreement that permits a service provider to use certain portions of BlackRock’s technology platform to service accounts managed by BFA and/or its affiliates, including the iShares funds. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Agreement for the coming year.

Conclusion: Based on a review of the factors described above, as well as such other factors as deemed appropriate by the Board, the Board, including all of the Independent Board Members, determined that the Fund’s investment advisory fee rate under the Advisory Agreement does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded to approve the continuance of the Advisory Agreement for the coming year.

 

 

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Supplemental Information  (unaudited)

 

Section 19(a) Notices

The amounts and sources of distributions reported are estimates and are being provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each Fund’s investment experience during the year and may be subject to changes based on tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.

September 30, 2023

 

     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

 

Global Infrastructure(a)

  $  0.668984     $     $  0.006445     $  0.675429       99         1     100

Global Timber & Forestry(a)

    0.601373             0.735026       1.336399       45             55       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.

 

Tailored Shareholder Reports for Open-End Mutual Funds and ETFs

Effective January 24, 2023, the SEC adopted rule and form amendments to require open-end mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these amendments on the shareholder reports for the Funds.

 

 

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  55


General Information

 

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’ Forms 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.

 

 

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Glossary of Terms Used in this Report  

 

Portfolio Abbreviation

 

ADR    American Depositary Receipt
JSC    Joint Stock Company
NVS    Non-Voting Shares

 

 

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Want to know more?

iShares.com    |     1-800-474-2737

This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.

Investing involves risk, including possible loss of principal.

The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).

The iShares Funds are not sponsored, endorsed, issued, sold or promoted by FTSE International Limited, S&P Dow Jones Indices LLC, or STOXX Ltd. nor do these companies make any representation regarding the advisability of investing in the iShares Funds. BlackRock is not affiliated with the companies listed above.

©2023 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-303-0923

 

 

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