LOGO

  SEPTEMBER 30, 2020

 

  

2020 Semi-Annual Report

(Unaudited)

 

iShares Trust

 

·  

iShares Focused Value Factor ETF  |  FOVL  |  NYSE Arca

 

·  

iShares U.S. Aerospace & Defense ETF  |  ITA  |  Cboe BZX

 

·  

iShares U.S. Broker-Dealers & Securities Exchanges ETF  |  IAI  |  NYSE Arca

 

·  

iShares U.S. Healthcare Providers ETF  |  IHF  |  NYSE Arca

 

·  

iShares U.S. Home Construction ETF  |  ITB  |  Cboe BZX

 

·  

iShares U.S. Infrastructure ETF  |  IFRA  |  Cboe BZX

 

·  

iShares U.S. Insurance ETF  |  IAK  |  NYSE Arca

 

·  

iShares U.S. Medical Devices ETF  |  IHI  |  NYSE Arca

 

·  

iShares U.S. Oil & Gas Exploration & Production ETF  |  IEO  |  Cboe BZX

 

·  

iShares U.S. Oil Equipment & Services ETF  |  IEZ  |  NYSE Arca

 

·  

iShares U.S. Pharmaceuticals ETF  |  IHE  |  NYSE Arca

 

·  

iShares U.S. Real Estate ETF  |  IYR  |  NYSE Arca

 

·  

iShares U.S. Regional Banks ETF  |  IAT  |  NYSE Arca

 

·  

iShares U.S. Telecommunications ETF  |  IYZ  |  Cboe BZX

 

 

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

You may elect to receive all future reports in paper free of charge. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds held with your financial intermediary.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary. Please note that not all financial intermediaries may offer this service.


The Markets in Review

Dear Shareholder,

The 12-month reporting period as of September 30, 2020 has been a time of sudden change in global financial markets, as the emergence and spread of the coronavirus led to a vast disruption in the global economy and financial markets. Prior to the outbreak of the virus, U.S. equities and bonds both delivered impressive returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, countries around the world took economically disruptive countermeasures. Stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off, and unemployment claims spiked, causing a global recession and a sharp fall in equity prices.

After markets hit their lowest point during the reporting period in late March 2020, a steady recovery ensued, as businesses began to re-open and governments learned to adapt to life with the virus. Equity prices continued to rise throughout the summer, fed by strong fiscal and monetary support and improving economic indicators. Many equity indices neared or surpassed all-time highs in early September 2020 before retreating amid concerns about a second wave of infections. In the United States, large-capitalization stocks advanced, outperforming small-capitalization stocks, which gained only marginally during the reporting period. International equities from developed economies were nearly flat, lagging emerging market stocks, which rebounded sharply.

During the market downturn, the performance of different types of fixed-income securities initially diverged due to a reduced investor appetite for risk. U.S. Treasuries benefited from the risk-off environment, and posted solid returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) touched an all-time low. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and both investment-grade and high-yield bonds recovered to post positive returns.

The Fed reduced short-term interest rates in late 2019 to support slowing economic growth. After the coronavirus outbreak, the Fed instituted an additional two emergency rate cuts, pushing short-term interest rates close to zero. To stabilize credit markets, the Fed also implemented a new bond-buying program, as did several other central banks around the world, including the European Central Bank and the Bank of Japan.

Looking ahead, while coronavirus-related disruptions have clearly hindered worldwide economic growth, we believe that the global expansion is likely to continue as economic activity resumes. Several risks remain, however, including a potential resurgence of the coronavirus amid loosened restrictions, policy fatigue among governments already deep into deficit spending, and structural damage to the financial system from lengthy economic interruptions.

Overall, we favor a moderately positive stance toward risk, and in particular toward credit given the extraordinary central bank measures taken in recent months. This support extends beyond investment-grade corporates and into high-yield, leading to attractive opportunities in that end of the market. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments. We remain neutral on equities overall while favoring European stocks, which are poised for cyclical upside as re-openings continue.

In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.

Sincerely,

 

LOGO

Rob Kapito

President, BlackRock, Inc.

LOGO

Rob Kapito

President, BlackRock, Inc.

 

Total Returns as of September 30, 2020
     6-Month   12-Month

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

  31.31%   15.15%

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

  31.60   0.39

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

  20.39   0.49

Emerging market equities
(MSCI Emerging Markets Index)

  29.37   10.54

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

  0.06   1.10

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

  0.71   10.74

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

  3.53   6.98

Tax-exempt municipal bonds
(S&P Municipal Bond Index)

  3.78   3.85

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

  15.18   3.20
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

 

 

2  

H I S  A G E  I S  N O T  A R T  O F  O U R  U N D  E P O R T


Table of Contents

 

      Page  

The Markets in Review

     2  

Fund Summary

     4  

About Fund Performance

     18  

Shareholder Expenses

     18  

Schedules of Investments

     19  

Financial Statements

  

Statements of Assets and Liabilities

     55  

Statements of Operations

     59  

Statements of Changes in Net Assets

     63  

Financial Highlights

     70  

Notes to Financial Statements

     84  

Board Review and Approval of Investment Advisory Contract

     96  

Supplemental Information

     104  

General Information

     105  

Glossary of Terms Used in this Report

     106  

 

 

 


Fund Summary  as of September 30, 2020    iShares® Focused Value Factor ETF

 

Investment Objective

The iShares Focused Value Factor ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. large- and mid-capitalization stocks with prominent value characteristics, as represented by the Focused Value Select Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     Since
Inception
           1 Year     Since
Inception
 

Fund NAV

    7.54       (32.35 )%      (22.18 )%        (32.35 )%      (31.99 )% 

Fund Market

    7.74         (32.20     (22.12       (32.20     (31.90

Index

    7.70               (32.27     (22.07             (32.27     (31.76

The inception date of the Fund was 3/19/19. The first day of secondary market trading was 3/21/19.

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value

(09/30/20)


 

 

      

Expenses
Paid During
the Period
 
 
 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,075.40        $ 1.30             $ 1,000.00        $ 1,023.80        $ 1.27          0.25

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Banks

    28.4

Materials

    19.9  

Diversified Financials

    13.1  

Insurance

    10.3  

Energy

    7.9  

Utilities

    5.1  

Retailing

    3.2  

Consumer Durables & Apparel

    2.5  

Telecommunication Services

    2.4  

Food, Beverage & Tobacco

    2.4  

Technology Hardware & Equipment

    2.4  

Capital Goods

    2.4  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Huntsman Corp.

    3.2

Penske Automotive Group Inc.

    3.2  

Westlake Chemical Corp.

    3.0  

Evercore Inc., Class A

    2.9  

Steel Dynamics Inc.

    2.8  

Olin Corp.

    2.8  

Reliance Steel & Aluminum Co.

    2.8  

LyondellBasell Industries NV, Class A

    2.8  

First American Financial Corp.

    2.7  

Regions Financial Corp.

    2.7  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  4


Fund Summary  as of September 30, 2020    iShares® U.S. Aerospace & Defense ETF

 

Investment Objective

The iShares U.S. Aerospace & Defense ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the aerospace and defense sector, as represented by the Dow Jones U.S. Select Aerospace & Defense IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    10.63       (28.28 )%      9.05     12.82       (28.28 )%      54.22     234.14

Fund Market

    10.63         (28.26     9.06       12.83         (28.26     54.29       234.44  

Index

    10.82               (27.96     9.54       13.29               (27.96     57.69       248.29  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)

 
 
      

Expenses
Paid During
the Period
 

 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,106.30        $ 2.22             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Aerospace & Defense

    97.9

Industrial Machinery

    1.3  

Leisure Products

    0.8  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Lockheed Martin Corp.

    18.7

Raytheon Technologies Corp.

    17.4  

Boeing Co. (The)

    9.3  

Teledyne Technologies Inc.

    4.6  

TransDigm Group Inc.

    4.4  

General Dynamics Corp.

    4.3  

L3Harris Technologies Inc.

    4.3  

Northrop Grumman Corp.

    4.3  

Textron Inc.

    3.4  

Howmet Aerospace Inc.

    2.7  

 

  (a) 

Excludes money market funds.

 

 

 

5  

2 0 2 0  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, 2020    iShares® U.S. Broker-Dealers & Securities Exchanges ETF

 

Investment Objective

The iShares U.S. Broker-Dealers & Securities Exchanges ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the investment services sector, as represented by the Dow Jones U.S. Select Investment Services IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    21.83       (1.72 )%      11.91     11.27       (1.72 )%      75.51     190.91

Fund Market

    22.04         (1.48     11.96       11.30         (1.48     75.91       191.80  

Index

    21.65               (1.61     12.29       11.64               (1.61     78.56       200.86  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
      

Annualized
Expense
Ratio


 
  $ 1,000.00        $ 1,218.30        $ 2.39             $ 1,000.00        $ 1,022.90        $ 2.18          0.43

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Investment Banking & Brokerage

    69.8

Financial Exchanges & Data

    30.0  

Asset Management & Custody Banks

    0.2  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Goldman Sachs Group Inc. (The)

    17.8

Morgan Stanley

    14.9  

CME Group Inc.

    11.9  

MarketAxess Holdings Inc.

    4.8  

Charles Schwab Corp. (The)

    4.7  

TD Ameritrade Holding Corp.

    4.7  

Raymond James Financial Inc.

    4.5  

Intercontinental Exchange Inc.

    4.5  

Cboe Global Markets Inc.

    4.5  

Nasdaq Inc.

    4.3  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  6


Fund Summary  as of September 30, 2020    iShares® U.S. Healthcare Providers ETF

 

Investment Objective

The iShares U.S. Healthcare Providers ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the healthcare providers sector, as represented by the Dow Jones U.S. Select Health Care Providers IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    21.51       25.89     11.52     16.00       25.89     72.49     341.32

Fund Market

    21.43         25.78       11.51       16.00         25.78       72.41       340.97  

Index

    21.76               26.41       11.98       16.43               26.41       76.10       357.91  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During

the Period


 

 (a) 

           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
      

Annualized
Expense
Ratio


 
  $ 1,000.00        $ 1,215.10        $ 2.33             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Managed Health Care

    45.6

Health Care Services

    34.0  

Health Care Facilities

    10.4  

Health Care Technology

    9.1  

Life Sciences Tools & Services

    0.9  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

UnitedHealth Group Inc.

    22.4

CVS Health Corp.

    11.7  

Anthem Inc.

    10.3  

Centene Corp.

    4.6  

Humana Inc.

    4.5  

Cigna Corp.

    4.4  

HCA Healthcare Inc.

    4.2  

Laboratory Corp. of America Holdings

    3.9  

Teladoc Health Inc.

    3.8  

Quest Diagnostics Inc.

    3.3  

 

  (a) 

Excludes money market funds.

 

 

 

7  

2 0 2 0  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, 2020    iShares® U.S. Home Construction ETF

 

Investment Objective

The iShares U.S. Home Construction ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the home construction sector, as represented by the Dow Jones U.S. Select Home Construction IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    96.10       31.56     17.32     17.33       31.56     122.29     394.23

Fund Market

    96.04         31.57       17.33       17.32         31.57       122.36       393.98  

Index

    96.63               32.17       17.83       17.84               32.17       127.10       416.25  

Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period

 
 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
      

Annualized
Expense
Ratio


 
  $ 1,000.00        $ 1,961.00        $ 3.12             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Homebuilding

    66.1

Building Products

    13.9  

Home Improvement Retail

    10.4  

Specialty Chemicals

    4.3  

Home Furnishings

    2.2  

Trading Companies & Distributors

    1.8  

Other (each representing less than 1%)

    1.3  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

DR Horton Inc.

    14.6

Lennar Corp., Class A

    13.1  

NVR Inc.

    8.3  

PulteGroup Inc.

    7.2  

Lowe’s Companies Inc.

    4.5  

Sherwin-Williams Co. (The)

    4.3  

Home Depot Inc. (The)

    4.3  

TopBuild Corp.

    3.3  

Toll Brothers Inc.

    3.3  

Masco Corp.

    2.8  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  8


Fund Summary  as of September 30, 2020    iShares® U.S. Infrastructure ETF

 

Investment Objective

The iShares U.S. Infrastructure ETF (the “Fund”) seeks to track the investment results of an index composed of equities of U.S. companies that have infrastructure exposure and that could benefit from a potential increase in domestic infrastructure activities, as represented by the NYSE® FactSet U.S. Infrastructure IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     Since
Inception
           1 Year     Since
Inception
 

Fund NAV

    21.27       (10.02 )%      0.78       (10.02 )%      1.96

Fund Market

    21.52         (9.84     0.86         (9.84     2.16  

Index

    21.57               (9.82     1.13               (9.82     2.83  

The inception date of the Fund was 4/3/18. The first day of secondary market trading was 4/5/18.

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
      

Annualized
Expense
Ratio


 
  $ 1,000.00        $ 1,212.70        $ 2.22             $ 1,000.00        $ 1,023.10        $ 2.03          0.40

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Electric Utilities

    18.6

Construction & Engineering

    11.6  

Multi-Utilities

    11.6  

Building Products

    7.0  

Steel

    7.0  

Gas Utilities

    6.7  

Water Utilities

    6.1  

Oil & Gas Storage & Transportation

    4.3  

Commodity Chemicals

    4.2  

Construction Machinery & Heavy Trucks

    3.6  

Construction Materials

    3.2  

Railroads

    3.2  

Specialty Chemicals

    2.0  

Trading Companies & Distributors

    1.5  

Industrial Machinery

    1.4  

Other (each representing less than 1%)

    8.0  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Duke Energy Corp.

    0.9

Pool Corp.

    0.8  

Consolidated Edison Inc.

    0.8  

Advanced Drainage Systems Inc.

    0.8  

Public Service Enterprise Group Inc.

    0.8  

Chesapeake Utilities Corp.

    0.8  

Avangrid Inc.

    0.8  

Southern Co. (The)

    0.8  

Vistra Corp.

    0.8  

American Electric Power Co. Inc.

    0.8  

 

  (a) 

Excludes money market funds.

 

 

 

9  

2 0 2 0  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, 2020    iShares® U.S. Insurance ETF

 

Investment Objective

The iShares U.S. Insurance ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the insurance sector, as represented by the Dow Jones U.S. Select Insurance IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

                Average Annual Total Returns           Cumulative Total Returns  
     6 Months            1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    13.07       (20.70 )%      4.86     8.71       (20.70 )%      26.78     130.52

Fund Market

    13.19         (20.58     4.91       8.72         (20.58     27.07       130.81  

Index

    13.31               (20.38     5.28       9.18               (20.38     29.32       140.71  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period


 (a) 
      

Annualized
Expense
Ratio


 
  $ 1,000.00        $ 1,130.70        $ 2.30             $ 1,000.00        $ 1,022.90        $ 2.18          0.43

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Property & Casualty Insurance

    55.1

Life & Health Insurance

    25.1  

Multi-line Insurance

    10.4  

Insurance Brokers

    6.7  

Reinsurance

    1.5  

Other Diversified Financial Services

    1.2  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Progressive Corp. (The)

    11.1

Chubb Ltd.

    10.5  

Allstate Corp. (The)

    5.9  

MetLife Inc.

    5.8  

Travelers Companies Inc. (The)

    5.5  

Prudential Financial Inc.

    5.0  

Aflac Inc.

    4.6  

American International Group Inc.

    4.4  

Arthur J Gallagher & Co.

    4.1  

Markel Corp.

    2.7  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  10


Fund Summary  as of September 30, 2020    iShares® U.S. Medical Devices ETF

 

Investment Objective

The iShares U.S. Medical Devices ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the medical devices sector, as represented by the Dow Jones U.S. Select Medical Equipment IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    33.46     21.72     22.57     19.32       21.72     176.67     485.18

Fund Market

    33.06       21.49       22.52       19.31         21.49       176.12       484.36  

Index

    33.75       22.21       23.11       19.83               22.21       182.75       510.63  

Certain sectors and markets performed exceptionally well based on market conditions during the six months period. Achieving such exceptional returns involves the risk of volatility and investors should not expect that such exceptional returns will be repeated.

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
           

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
      

Annualized
Expense
Ratio
 
 
 
$ 1,000.00        $ 1,334.60        $ 2.46             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Health Care Equipment

    84.4

Life Sciences Tools & Services

    15.3  

Other (each representing less than 1%)

    0.3  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Abbott Laboratories

    14.2

Thermo Fisher Scientific Inc.

    12.9  

Medtronic PLC

    10.3  

Danaher Corp.

    8.4  

Stryker Corp.

    4.5  

Becton Dickinson and Co.

    4.4  

Intuitive Surgical Inc.

    4.4  

Edwards Lifesciences Corp.

    4.2  

Boston Scientific Corp.

    4.1  

Baxter International Inc.

    3.4  

 

  (a) 

Excludes money market funds.

 

 

 

11  

2 0 2 0  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, 2020    iShares® U.S. Oil & Gas Exploration & Production ETF

 

Investment Objective

The iShares U.S. Oil & Gas Exploration & Production ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the oil and gas exploration and production sector, as represented by the Dow Jones U.S. Select Oil Exploration & Production IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    18.20     (46.08 )%      (12.17 )%      (5.21 )%        (46.08 )%      (47.72 )%      (41.42 )% 

Fund Market

    18.39       (46.05     (12.15     (5.20       (46.05     (47.66     (41.35

Index

    18.49       (45.88     (11.80     (4.83             (45.88     (46.63     (39.05

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
           

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,182.00        $ 2.30             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Oil & Gas Exploration & Production

    66.7

Oil & Gas Refining & Marketing

    26.8  

Oil & Gas Storage & Transportation

    6.5  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

ConocoPhillips

    16.0

Phillips 66

    10.3  

EOG Resources Inc.

    9.5  

Marathon Petroleum Corp.

    8.7  

Cheniere Energy Inc.

    4.7  

Valero Energy Corp.

    4.5  

Concho Resources Inc.

    4.5  

Pioneer Natural Resources Co.

    4.4  

Hess Corp.

    4.3  

Cabot Oil & Gas Corp.

    3.8  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  12


Fund Summary  as of September 30, 2020    iShares® U.S. Oil Equipment & Services ETF

 

Investment Objective

The iShares U.S. Oil Equipment & Services ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the oil equipment and services sector, as represented by the Dow Jones U.S. Select Oil Equipment & Services IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    22.32     (57.52 )%      (25.97 )%      (15.20 )%        (57.52 )%      (77.76 )%      (80.76 )% 

Fund Market

    22.35       (57.53     (25.98     (15.21       (57.53     (77.78     (80.79

Index

    22.88       (57.39     (25.77     (14.96             (57.39     (77.46     (80.21

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
           

Beginning
Account Value
(04/01/20)
 
 
 
      

Ending
Account Value
(09/30/20)
 
 
 
      

Expenses
Paid During
the Period
 
 
 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,223.20        $ 2.34             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Oil & Gas Equipment & Services

    90.1

Oil & Gas Drilling

    9.9  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Schlumberger Ltd.

    22.3

Halliburton Co.

    21.4  

Helmerich & Payne Inc.

    5.2  

Baker Hughes Co.

    5.0  

TechnipFMC PLC.

    4.7  

ChampionX Corp.

    4.5  

National Oilwell Varco Inc.

    4.2  

Cactus Inc., Class A

    3.7  

Dril-Quip Inc.

    3.5  

Archrock Inc.

    2.8  

 

  (a) 

Excludes money market funds.

 

 

 

13  

2 0 2 0  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, 2020    iShares® U.S. Pharmaceuticals ETF

 

Investment Objective

The iShares U.S. Pharmaceuticals ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the pharmaceuticals sector, as represented by the Dow Jones U.S. Select Pharmaceuticals IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    21.92     18.53     3.46     11.87       18.53     18.55     207.08

Fund Market

    22.03       18.71       3.51       11.89         18.71       18.83       207.63  

Index

    22.21       19.04       3.76       12.24               19.04       20.27       217.32  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value

(09/30/20)


 

 

      

Expenses
Paid During
the Period
 

 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,219.20        $ 2.34             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Pharmaceuticals

    95.8

Biotechnology

    4.2  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Johnson & Johnson

    22.4

Merck & Co. Inc.

    19.1  

Horizon Therapeutics PLC

    4.8  

Zoetis Inc.

    4.7  

Bristol-Myers Squibb Co.

    4.6  

Pfizer Inc.

    4.6  

Catalent Inc.

    4.5  

Eli Lilly & Co.

    4.4  

Elanco Animal Health Inc.

    3.7  

Jazz Pharmaceuticals PLC

    3.2  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  14


Fund Summary  as of September 30, 2020    iShares® U.S. Real Estate ETF

 

Investment Objective

The iShares U.S. Real Estate ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the real estate sector, as represented by the Dow Jones U.S. Real Estate IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    16.05     (11.79 )%      6.17     8.14       (11.79 )%      34.93     118.75

Fund Market

    16.16       (11.83     6.17       8.14         (11.83     34.91       118.77  

Index

    16.27       (11.39     6.62       8.65               (11.39     37.80       129.34  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value

(09/30/20)


 

 

      

Expenses
Paid During
the Period
 

 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,160.50        $ 2.27             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Specialized REITs

    41.5

Residential REITs

    13.6  

Industrial REITs

    10.9  

Health Care REITs

    8.6  

Retail REITs

    7.0  

Office REITs

    6.7  

Research & Consulting Services

    3.2  

Mortgage REITs

    2.8  

Diversified REITs

    2.7  

Real Estate Services

    2.0  

Other (each representing less than 1%)

    1.0  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

American Tower Corp.

    10.2

Prologis Inc.

    7.0  

Crown Castle International Corp.

    6.6  

Equinix Inc.

    4.7  

Digital Realty Trust Inc.

    3.7  

SBA Communications Corp.

    3.4  

Public Storage

    3.2  

CoStar Group Inc.

    3.2  

Welltower Inc.

    2.2  

Weyerhaeuser Co.

    2.0  

 

  (a) 

Excludes money market funds.

 

 

 

15  

2 0 2 0  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, 2020    iShares® U.S. Regional Banks ETF

 

Investment Objective

The iShares U.S. Regional Banks ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the regional banks sector, as represented by the Dow Jones U.S. Select Regional Banks IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    15.15     (27.00 )%      1.79     6.43       (27.00 )%      9.28     86.49

Fund Market

    15.19       (26.99     1.80       6.43         (26.99     9.31       86.48  

Index

    15.39       (26.78     2.21       6.90               (26.78     11.56       94.82  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value

(09/30/20)


 

 

      

Expenses
Paid During
the Period
 

 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,151.50        $ 2.27             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Regional Banks

    84.6

Diversified Banks

    13.4  

Thrifts & Mortgage Finance

    2.0  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Truist Financial Corp.

    14.0

U.S. Bancorp.

    13.4  

PNC Financial Services Group Inc. (The)

    12.7  

First Republic Bank/CA

    5.1  

Fifth Third Bancorp.

    4.1  

SVB Financial Group

    3.4  

M&T Bank Corp.

    3.2  

KeyCorp

    3.2  

Regions Financial Corp.

    3.0  

Citizens Financial Group Inc.

    2.9  

 

  (a) 

Excludes money market funds.

 

 

 

U N D  U M M A R Y

  16


Fund Summary  as of September 30, 2020    iShares® U.S. Telecommunications ETF

 

Investment Objective

The iShares U.S. Telecommunications ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities in the telecommunications sector, as represented by the Dow Jones U.S. Select Telecommunications IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns           Cumulative Total Returns  
     6 Months     1 Year     5 Years     10 Years            1 Year     5 Years     10 Years  

Fund NAV

    10.82     (4.03 )%      2.72     4.97       (4.03 )%      14.36     62.43

Fund Market

    10.78       (4.03     2.73       4.97         (4.03     14.40       62.42  

Index

    10.97       (3.74     2.85       5.19               (3.74     15.06       65.92  

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 18 for more information.

Expense Example

 

Actual           Hypothetical 5% Return           
 

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value

(09/30/20)


 

 

      

Expenses
Paid During
the Period
 

 (a) 
           

Beginning
Account Value
(04/01/20)


 
      

Ending
Account Value
(09/30/20)


 
      

Expenses
Paid During
the Period
 

 (a) 
      

Annualized
Expense
Ratio
 
 
 
  $ 1,000.00        $ 1,108.20        $ 2.22             $ 1,000.00        $ 1,023.00        $ 2.13          0.42

 

  (a) 

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (183 days) and divided by the number of days in the year (365 days). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Shareholder Expenses” on page 18 for more information.

 

Portfolio Information

 

ALLOCATION BY SECTOR

 

Sector    
Percent of
Total Investments
 
(a) 

Diversified Telecommunication Services

    59.4

Communications Equipment

    29.9  

Wireless Telecommunication Services

    6.4  

Household Durables

    4.3  

TEN LARGEST HOLDINGS

 

Security    
Percent of
Total Investments
 
(a) 

Verizon Communications Inc.

    22.9

AT&T Inc.

    22.5  

Motorola Solutions Inc.

    4.7  

T-Mobile U.S. Inc.

    4.7  

Cisco Systems Inc.

    4.5  

Garmin Ltd.

    4.3  

Arista Networks Inc.

    4.2  

CenturyLink Inc.

    3.7  

GCI Liberty Inc., Class A

    3.1  

Liberty Global PLC, Class C

    2.8  

 

  (a) 

Excludes money market funds.

 

 

 

17  

2 0 2 0  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


About Fund Performance

 

Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.

Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. 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.

Shareholder Expenses

As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.

Actual Expenses — The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”

Hypothetical Example for Comparison Purposes — The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

 

B O U T  U N D  E R F O R M A  N C E / S H A R E H O L D E R  X P E N S E S

  18


Schedule of Investments  (unaudited)

September 30, 2020

  

iShares® Focused Value Factor ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Asset Management & Custody Banks — 5.0%  

Affiliated Managers Group Inc.

    6,633     $ 453,564  

Ameriprise Financial Inc.

    3,296       507,947  
   

 

 

 
      961,511  
Automotive Retail — 3.2%            

Penske Automotive Group Inc.

    12,777       608,952  
   

 

 

 
Commodity Chemicals — 11.1%            

Cabot Corp.

    13,349       480,964  

LyondellBasell Industries NV, Class A

    7,526       530,508  

Olin Corp.

    43,046       532,910  

Westlake Chemical Corp.

    9,219       582,825  
   

 

 

 
          2,127,207  
Construction Machinery & Heavy Trucks — 2.4%  

Trinity Industries Inc.

    23,231       453,005  
   

 

 

 
Diversified Banks — 2.6%            

Bank of America Corp.

    20,825       501,674  
   

 

 

 
Diversified Chemicals — 3.2%            

Huntsman Corp.

    27,523       611,286  
   

 

 

 
Gas Utilities — 2.5%            

National Fuel Gas Co.

    11,796       478,800  
   

 

 

 
Home Furnishings — 2.5%            

Mohawk Industries Inc.(a)

    4,860       474,287  
   

 

 

 
Independent Power Producers & Energy Traders — 2.6%  

Vistra Corp.

    26,562       500,959  
   

 

 

 
Integrated Oil & Gas — 4.1%            

Chevron Corp.

    5,543       399,096  

Exxon Mobil Corp.

    11,060       379,690  
   

 

 

 
      778,786  
Integrated Telecommunication Services — 2.4%  

AT&T Inc.

    16,361       466,452  
   

 

 

 
Investment Banking & Brokerage — 8.1%            

Evercore Inc., Class A

    8,394       549,471  

Goldman Sachs Group Inc. (The)

    2,503       503,028  

Morgan Stanley

    10,240       495,104  
   

 

 

 
      1,547,603  
Life & Health Insurance — 2.6%            

Aflac Inc.

    13,727       498,977  
   

 

 

 
Security   Shares     Value  
Oil & Gas Exploration & Production — 3.8%            

ConocoPhillips

    11,770     $ 386,527  

EOG Resources Inc.

    9,763       350,882  
   

 

 

 
      737,409  
Packaged Foods & Meats — 2.4%            

Kraft Heinz Co. (The)

    15,509       464,495  
   

 

 

 
Property & Casualty Insurance — 7.7%            

First American Financial Corp.

    10,300       524,373  

Mercury General Corp.

    12,137       502,108  

Old Republic International Corp.

    30,325       446,990  
   

 

 

 
      1,473,471  
Regional Banks — 23.6%            

Associated Banc-Corp.

    36,154       456,263  

Bank OZK

    21,073       449,276  

East West Bancorp. Inc.

    13,648       446,836  

M&T Bank Corp.

    4,757       438,072  

People’s United Financial Inc.

    42,748       440,732  

Pinnacle Financial Partners Inc.

    11,779       419,215  

Popular Inc.

    13,306       482,609  

Regions Financial Corp.

    44,478       512,831  

Webster Financial Corp.

    17,287       456,550  

Zions Bancorp NA

    14,547       425,063  
   

 

 

 
      4,527,447  
Steel — 5.6%            

Reliance Steel & Aluminum Co.

    5,210       531,628  

Steel Dynamics Inc.

    18,957       542,739  
   

 

 

 
      1,074,367  
Technology Distributors — 2.4%            

Avnet Inc.

    17,737       458,324  
   

 

 

 
Thrifts & Mortgage Finance — 2.1%            

New York Community Bancorp. Inc.

    48,490       401,012  
   

 

 

 

Total Common Stocks — 99.9%
(Cost: $19,911,550)

 

    19,146,024  
   

 

 

 

Total Investments in Securities — 99.9%
(Cost: $19,911,550)

 

    19,146,024  

Other Assets, Less Liabilities — 0.1%

      26,192  
   

 

 

 

Net Assets — 100.0%

    $   19,172,216  
   

 

 

 

 

(a) 

Non-income producing security.

 

 

19  

2 0 2 0  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, 2020

  

iShares® Focused Value Factor ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2020, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
03/31/20
     Purchases
at Cost
     Proceeds
from Sales
    Net Realized
Gain (Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
09/30/20
     Shares
Held at
09/30/20
     Income     Capital
Gain
Distributions
from
Underlying
Funds
 

BlackRock Cash Funds: Institutional, SL Agency Shares(a)

   $ 477,236      $      $ (478,246) (b)    $ 826      $ 184      $             $ 4,654 (c)    $  

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

     29,000               (29,000 )(b)                                  17        
          

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 
           $ 826      $ 184      $         $ 4,671     $  
          

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 

 

  (a) 

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

 
  (b) 

Represents net amount purchased (sold).

 
  (c) 

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

 

Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of September 30, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.

 

      Level 1        Level 2        Level 3        Total  

Investments

                 

Assets

                 

Common Stocks

   $ 19,146,024        $             —        $             —        $ 19,146,024  
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

C H E D U L E  O F  N V E S T M E N T  S   20


Schedule of Investments  (unaudited)

September 30, 2020

  

iShares® U.S. Aerospace & Defense ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Aerospace & Defense — 97.8%  

AAR Corp.

    358,625     $ 6,742,150  

Aerojet Rocketdyne Holdings Inc.(a)(b)

    790,176       31,520,121  

Aerovironment Inc.(a)(b)

    237,056       14,225,731  

Axon Enterprise Inc.(a)(b)

    685,980       62,218,386  

Boeing Co. (The)

    1,459,897       241,262,578  

BWX Technologies Inc.

    1,029,781       57,986,968  

Cubic Corp.(b)

    338,571       19,694,675  

Curtiss-Wright Corp.

    449,320       41,903,583  

General Dynamics Corp.

    810,938       112,258,147  

HEICO Corp.(b)

    451,634       47,268,014  

HEICO Corp., Class A

    783,523       69,467,149  

Hexcel Corp.

    902,442       30,276,929  

Howmet Aerospace Inc.

    4,242,016       70,926,508  

Huntington Ingalls Industries Inc.

    437,594       61,591,356  

Kaman Corp.

    298,874       11,647,120  

Kratos Defense & Security Solutions
Inc.(a)(b)

    1,326,214       25,569,406  

L3Harris Technologies Inc.

    655,469       111,324,855  

Lockheed Martin Corp.

    1,258,716       482,440,669  

Maxar Technologies Inc.

    657,849       16,406,754  

Mercury Systems Inc.(a)(b)

    605,198       46,878,637  

Moog Inc., Class A

    324,239       20,598,904  

National Presto Industries Inc.

    56,118       4,593,819  

Northrop Grumman Corp.

    349,238       110,181,097  

PAE Inc.(a)(b)

    667,686       5,675,331  

Parsons Corp.(a)(b)

    250,361       8,397,108  

Raytheon Technologies Corp.

    7,816,692       449,772,458  

Spirit AeroSystems Holdings Inc.,
Class A(b)

    1,141,470       21,585,198  

Teledyne Technologies Inc.(a)(b)

    379,348       117,677,543  

Textron Inc.

    2,464,357       88,938,644  

TransDigm Group Inc.

    236,629       112,427,170  

Triumph Group Inc.

    562,095       3,659,238  

Virgin Galactic Holdings Inc.(a)(b)

    1,390,875       26,746,526  
   

 

 

 
        2,531,862,772  
Security   Shares     Value  
Industrial Machinery — 1.2%            

RBC Bearings Inc.(a)(b)

    270,950     $ 32,841,849  
   

 

 

 
Leisure Products — 0.8%            

Smith & Wesson Brands Inc.(b)

    601,491       9,335,140  

Sturm Ruger & Co. Inc.

    189,078       11,564,011  
   

 

 

 
      20,899,151  
   

 

 

 

Total Common Stocks — 99.8%
(Cost: $3,043,185,773)

 

    2,585,603,772  
   

 

 

 

Short-Term Investments

   
Money Market Funds — 5.5%            

BlackRock Cash Funds: Institutional,

   

SL Agency Shares,
0.31%(c)(d)(e)

    136,895,259       137,018,465  

BlackRock Cash Funds: Treasury,

   

SL Agency Shares,
0.04%(c)(d)

    4,340,000       4,340,000  
   

 

 

 
      141,358,465  
   

 

 

 

Total Short-Term Investments — 5.5%
(Cost: $141,272,274)

 

    141,358,465  
   

 

 

 

Total Investments in Securities — 105.3%
(Cost: $3,184,458,047)

 

    2,726,962,237  

Other Assets, Less Liabilities — (5.3)%

      (137,382,810
   

 

 

 

Net Assets — 100.0%

    $   2,589,579,427  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period-end.

(e) 

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

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2020, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
03/31/20
     Purchases
at Cost
    Proceeds
from Sales
     Net Realized
Gain (Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
09/30/20
     Shares
Held at
09/30/20
     Income    

Capital
Gain
Distributions
from

Underlying
Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

   $ 98,605,172      $ 38,315,939 (a)    $      $ 22,540      $ 74,814      $ 137,018,465        136,895,259      $ 470,787 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

            4,340,000 (a)                           4,340,000        4,340,000        2,670        
          

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 
           $ 22,540      $ 74,814      $ 141,358,465         $ 473,457     $  
          

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 

 

  (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.

 

 

 

21  

2 0 2 0  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, 2020

  

iShares® U.S. Aerospace & Defense ETF

 

Futures Contracts

 

Description    Number of
Contracts
     Expiration
Date
     Notional
Amount
(000)
     Value/
Unrealized
Appreciation
(Depreciation)
 

Long Contracts

           

S&P Select Sector Industrial E-Mini Index

     49        12/18/20      $   3,788      $ 34,997  
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of September 30, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Equity
Contracts
 

Assets — Derivative Financial Instruments

  

Futures contracts

  

Unrealized appreciation on futures contracts(a)

   $ 34,997  
  

 

 

 

 

  (a) 

Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss).

 

For the six months ended September 30, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Equity
Contracts
 

Net Realized Gain (Loss) from:

  

Futures contracts

   $ 1,474,508  
  

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:       

Futures contracts

   $ 3,314  
  

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — long

   $ 2,531,563  

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

Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of September 30, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.

 

      Level 1        Level 2        Level 3        Total  

Investments

                 

Assets

                 

Common Stocks

   $ 2,585,603,772        $        $        $ 2,585,603,772  

Money Market Funds

     141,358,465                            141,358,465  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,726,962,237        $        $        $ 2,726,962,237  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative financial instruments(a)

                 

Assets

                 

Futures Contracts

   $ 34,997        $                 —        $                 —        $ 34,997  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Shown at the unrealized appreciation (depreciation) on the contracts.

 

See notes to financial statements.

 

 

C H E D U L E  O F  N V E S T M E N T  S   22


Schedule of Investments  (unaudited)

September 30, 2020

  

iShares® U.S. Broker-Dealers & Securities Exchanges ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Asset Management & Custody Banks — 0.2%  

Diamond Hill Investment Group Inc.

    1,753     $ 221,439  
   

 

 

 
Financial Exchanges & Data — 30.0%            

Cboe Global Markets Inc.

    50,109       4,396,563  

CME Group Inc.

    70,584       11,809,409  

Intercontinental Exchange Inc.

    44,534       4,455,627  

MarketAxess Holdings Inc.

    9,827       4,732,585  

Nasdaq Inc.

    34,889       4,281,229  
   

 

 

 
        29,675,413  
Investment Banking & Brokerage — 69.7%            

BGC Partners Inc., Class A

    188,534       452,481  

Charles Schwab Corp. (The)

    128,670       4,661,714  

Cowen Inc., Class A(a)

    16,592       269,952  

E*TRADE Financial Corp.

    85,140       4,261,257  

Evercore Inc., Class A

    24,383       1,596,111  

Goldman Sachs Group Inc. (The)

    87,395       17,563,773  

Houlihan Lokey Inc.

    30,476       1,799,608  

Interactive Brokers Group Inc., Class A

    47,487       2,295,047  

Lazard Ltd., Class A

    67,739       2,238,774  

LPL Financial Holdings Inc.

    47,510       3,642,592  

Moelis & Co., Class A

    33,186       1,166,156  

Morgan Stanley

    304,376       14,716,580  

Piper Sandler Cos

    8,253       602,469  

PJT Partners Inc., Class A

    14,437       875,027  

Raymond James Financial Inc.

    61,274       4,458,296  

Stifel Financial Corp.

    41,183       2,082,212  

StoneX Group Inc.(b)

    9,776       500,140  

TD Ameritrade Holding Corp.

    118,989       4,658,419  
Security   Shares     Value  
Investment Banking & Brokerage (continued)            

Virtu Financial Inc., Class A

    48,592     $ 1,118,102  
   

 

 

 
      68,958,710  
   

 

 

 

Total Common Stocks — 99.9%
(Cost: $114,985,817)

 

    98,855,562  
   

 

 

 

Short-Term Investments

 

Money Market Funds — 0.3%  

BlackRock Cash Funds: Institutional,

   

SL Agency Shares,
0.31%(c)(d)(e)

    172,878       173,034  

BlackRock Cash Funds: Treasury,

   

SL Agency Shares,
0.04%(c)(d)

    140,000       140,000  
   

 

 

 
          313,034  
   

 

 

 

Total Short-Term Investments — 0.3%
(Cost: $312,884)

      313,034  
   

 

 

 

Total Investments in Securities — 100.2%
(Cost: $115,298,701)

 

    99,168,596  

Other Assets, Less Liabilities — (0.2)%

 

    (171,381
   

 

 

 

Net Assets — 100.0%

 

  $   98,997,215  
   

 

 

 

 

(a) 

All or a portion of this security is on loan.

(b) 

Non-income producing security.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period-end.

(e) 

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

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2020, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
03/31/20
     Purchases
at Cost
    Proceeds
from Sales
    Net Realized
Gain (Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
09/30/20
     Shares
Held at
09/30/20
     Income    

Capital
Gain
Distributions

from
Underlying
Funds

 

BlackRock Cash Funds: Institutional, SL Agency Shares

   $ 1,866,215      $     $ (1,694,300 )(a)    $ 1,017      $ 102      $ 173,034        172,878      $ 2,539 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

            140,000 (a)                          140,000        140,000        103        
         

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 
          $ 1,017      $ 102      $ 313,034         $ 2,642     $  
         

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

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

 

Futures Contracts

 

Description    Number of
Contracts
     Expiration
Date
     Notional
Amount
(000)
     Value/
Unrealized
Appreciation
(Depreciation)
 

Long Contracts

           

S&P Select Sector Financial E-Mini Index

     1        12/18/20      $ 74      $ (1,077
           

 

 

 

 

 

23  

2 0 2 0  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, 2020

  

iShares® U.S. Broker-Dealers & Securities Exchanges ETF

 

Derivative Financial Instruments Categorized by Risk Exposure

As of September 30, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

 

 
     Equity
Contracts
 

 

 

Liabilities — Derivative Financial Instruments

  

Futures contracts

  

Unrealized depreciation on futures contracts(a)

   $ 1,077  
  

 

 

 

 

  (a) 

Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss).

 

For the six months ended September 30, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

 

 
     Equity
Contracts
 

 

 

Net Realized Gain (Loss) from:

  

Futures contracts

   $ (2,478
  

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:       

Futures contracts

   $ (2,221
  

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts:

  

Average notional value of contracts — long

   $ 93,329  

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

Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of September 30, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Investments

                 

Assets

                 

Common Stocks

   $ 98,855,562        $             —        $             —        $ 98,855,562  

Money Market Funds

     313,034                            313,034  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 99,168,596        $        $        $ 99,168,596  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative financial instruments(a)

                 

Liabilities

                 

Futures Contracts

   $ (1,077      $        $        $ (1,077
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Shown at the unrealized appreciation (depreciation) on the contracts.

 

See notes to financial statements.

 

 

C H E D U L E  O F  N V E S T M E N T  S   24


Schedule of Investments  (unaudited)

September 30, 2020

  

iShares® U.S. Healthcare Providers ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Health Care Facilities — 10.4%            

Acadia Healthcare Co. Inc.(a)(b)

    173,728     $ 5,121,501  

Brookdale Senior Living Inc.(a)

    358,598       910,839  

Community Health Systems Inc.(a)(b)

    220,046       928,594  

Encompass Health Corp.

    194,199       12,619,051  

Ensign Group Inc. (The)

    98,704       5,632,050  

Hanger Inc.(a)

    74,564       1,179,603  

HCA Healthcare Inc.

    307,665       38,359,672  

National HealthCare Corp.

    24,043       1,498,119  

Pennant Group Inc. (The)(a)(b)

    49,042       1,891,060  

Select Medical Holdings Corp.(a)

    209,283       4,357,272  

Tenet Healthcare Corp.(a)

    205,804       5,044,256  

U.S. Physical Therapy Inc.

    25,032       2,174,780  

Universal Health Services Inc., Class B

    151,834       16,249,275  
   

 

 

 
      95,966,072  
Health Care Services — 33.9%            

1Life Healthcare Inc.(a)(b)

    140,481       3,984,041  

Addus HomeCare Corp.(a)

    29,028       2,743,436  

Amedisys Inc.(a)(b)

    63,401       14,989,898  

Chemed Corp.

    31,086       14,932,160  

Cigna Corp.(b)

    236,560       40,075,630  

CorVel Corp.(a)(b)

    17,897       1,528,941  

CVS Health Corp.

    1,833,873       107,098,183  

DaVita Inc.(a)

    147,213       12,608,793  

Guardant Health Inc.(a)(b)

    151,611       16,947,078  

Laboratory Corp. of America Holdings(a)

    190,416       35,849,620  

LHC Group Inc.(a)(b)

    61,689       13,112,614  

MEDNAX Inc.(a)(b)

    166,734       2,714,430  

Ontrak Inc.(a)(b)

    15,020       901,200  

Option Care Health Inc.(a)

    105,967       1,416,779  

Premier Inc., Class A

    138,033       4,531,623  

Providence Service Corp. (The)(a)(b)

    23,818       2,212,930  

Quest Diagnostics Inc.

    262,561       30,060,609  

R1 RCM Inc.(a)(b)

    225,612       3,869,246  

RadNet Inc.(a)

    83,772       1,285,900  

Tivity Health Inc.(a)

    73,174       1,025,900  
   

 

 

 
        311,889,011  
Health Care Technology — 9.1%            

Change Healthcare Inc.(a)(b)

    445,675       6,466,744  

Health Catalyst Inc.(a)

    58,026       2,123,752  

HealthStream Inc.(a)(b)

    50,095       1,005,407  

HMS Holdings Corp.(a)

    172,858       4,139,949  

Inovalon Holdings Inc., Class A(a)(b)

    148,527       3,928,539  

Inspire Medical Systems Inc.(a)(b)

    52,336       6,753,961  

Livongo Health Inc.(a)(b)

    125,854       17,625,853  
Security   Shares     Value  
Health Care Technology (continued)            

Phreesia Inc.(a)

    48,663     $ 1,563,542  

Schrodinger Inc.(a)(b)

    64,002       3,040,735  

Tabula Rasa HealthCare Inc.(a)(b)

    40,889       1,667,044  

Teladoc Health Inc.(a)(b)

    159,621       34,995,308  
   

 

 

 
      83,310,834  
Life Sciences Tools & Services — 0.9%            

NeoGenomics Inc.(a)(b)

    215,651       7,955,366  
   

 

 

 
Managed Health Care — 45.6%            

Anthem Inc.

    352,432       94,659,711  

Centene Corp.(a)

    717,849       41,872,132  

HealthEquity Inc.(a)(b)

    149,759       7,693,120  

Humana Inc.

    100,849       41,740,393  

Magellan Health Inc.(a)

    43,957       3,331,061  

Molina Healthcare Inc.(a)

    117,205       21,453,203  

Progyny Inc.(a)(b)

    70,671       2,079,848  

Triple-S Management Corp., Class B(a)

    45,868       819,661  

UnitedHealth Group Inc.

    659,711       205,678,098  
   

 

 

 
      419,327,227  
   

 

 

 

Total Common Stocks — 99.9%
(Cost: $889,015,430)

        918,448,510  
   

 

 

 

Short-Term Investments

   
Money Market Funds — 6.9%            

BlackRock Cash Funds: Institutional,

   

SL Agency Shares,
0.31%(c)(d)(e)

    62,575,817       62,632,135  

BlackRock Cash Funds: Treasury,

   

SL Agency Shares,
0.04%(c)(d)

    1,070,000       1,070,000  
   

 

 

 
      63,702,135  
   

 

 

 

Total Short-Term Investments — 6.9%
(Cost: $63,661,895)

 

    63,702,135  
   

 

 

 

Total Investments in Securities — 106.8%
(Cost: $952,677,325)

 

    982,150,645  

Other Assets, Less Liabilities — (6.8)%

      (62,938,387
   

 

 

 

Net Assets — 100.0%

    $ 919,212,258  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period-end.

(e) 

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

 

 

25  

2 0 2 0  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, 2020

  

iShares® U.S. Healthcare Providers ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2020, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer   Value at
03/31/20
    Purchases
at Cost
    Proceeds
from Sales
    Net Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
09/30/20
    Shares
Held at
09/30/20
    Income     Capital
Gain
Distributions
from
Underlying
Funds
 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 56,705,982     $ 5,887,795 (a)    $     $ 15,354     $ 23,004     $ 62,632,135       62,575,817     $ 135,180 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    2,165,000             (1,095,000 )(a)                  1,070,000       1,070,000       1,097        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ 15,354     $ 23,004     $ 63,702,135       $ 136,277     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b) 

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

 

Futures Contracts

 

Description    Number of
Contracts
     Expiration
Date
    

Notional
Amount

(000)

     Value/
Unrealized
Appreciation
(Depreciation)
 

Long Contracts

           

S&P Select Sector Health Care E-Mini Index

     7        12/18/20      $ 746      $ 2,668  
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of September 30, 2020, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Equity
Contracts
 

Assets — Derivative Financial Instruments

  

Futures contracts

  

Unrealized appreciation on futures contracts(a)

   $ 2,668  
  

 

 

 

 

  (a) 

Net cumulative appreciation (depreciation) on futures contracts are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss).

 

For the six months ended September 30, 2020, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Equity
Contracts
 

Net Realized Gain (Loss) from:

  

Futures contracts

   $ 435,878  
  

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:       

Futures contracts

   $ (101,036
  

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — long

   $ 1,527,200  

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

Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

 

 

C H E D U L E  O F  N V E S T M E N T  S   26


Schedule of Investments  (unaudited) (continued)

September 30, 2020

  

iShares® U.S. Healthcare Providers ETF

 

Fair Value Measurements (continued)

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of September 30, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.

 

      Level 1        Level 2        Level 3        Total  

Investments

                 

Assets

                 

Common Stocks

   $ 918,448,510        $        $        $ 918,448,510  

Money Market Funds

     63,702,135                            63,702,135  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 982,150,645        $        $        $ 982,150,645  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative financial instruments(a)

                 

Assets

                 

Futures Contracts

   $ 2,668        $             —        $             —        $ 2,668  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

Shown at the unrealized appreciation (depreciation) on the contracts.

 

See notes to financial statements.

 

 

27  

2 0 2 0  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, 2020

  

iShares® U.S. Home Construction ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

 

Building Products — 13.9%  

American Woodmark Corp.(a)

    79,460     $ 6,240,788  

AZEK Co. Inc. (The)(a)

    335,521       11,679,486  

Builders FirstSource Inc.(a)(b)

    545,015       17,778,389  

Fortune Brands Home & Security Inc.

    645,250       55,827,030  

JELD-WEN Holding Inc.(a)(b)

    315,050       7,120,130  

Lennox International Inc.

    162,584       44,322,024  

Masco Corp.

    1,221,541       67,343,555  

Masonite International Corp.(a)(b)

    114,521       11,268,866  

Owens Corning

    504,497       34,714,439  

PGT Innovations Inc.(a)

    275,715       4,830,527  

Quanex Building Products Corp.

    153,397       2,828,641  

Simpson Manufacturing Co. Inc.

    203,051       19,728,435  

Trex Co. Inc.(a)(b)

    540,658       38,711,113  

UFP Industries Inc.

    285,591       16,138,748  
   

 

 

 
      338,532,171  
Construction Materials — 0.7%            

Eagle Materials Inc.

    194,949       16,827,998  
   

 

 

 
Forest Products — 0.6%            

Louisiana-Pacific Corp.

    524,358       15,473,805  
   

 

 

 
Home Furnishings — 2.2%            

Ethan Allen Interiors Inc.

    101,902       1,379,753  

Leggett & Platt Inc.

    618,371       25,458,334  

Mohawk Industries Inc.(a)

    279,327       27,259,522  
   

 

 

 
          54,097,609  
Home Improvement Retail — 10.4%            

Floor & Decor Holdings Inc., Class A(a)

    484,503       36,240,824  

Home Depot Inc. (The)

    378,785       105,192,382  

Lowe’s Companies Inc.

    657,818       109,105,694  

Lumber Liquidators Holdings Inc.(a)(b)

    134,896       2,974,457  
   

 

 

 
        253,513,357  
Homebuilding — 66.0%            

Beazer Homes USA Inc.(a)(b)

    419,256       5,534,179  

Cavco Industries Inc.(a)(b)

    121,290       21,869,800  

Century Communities Inc.(a)(b)

    412,120       17,445,040  

DR Horton Inc.

    4,702,462       355,647,201  

Green Brick Partners Inc.(a)(b)

    683,816       11,009,438  

Installed Building Products Inc.(a)

    321,768       32,739,894  

KB Home

    1,251,167       48,032,301  

Lennar Corp., Class A(b)

    3,901,807       318,699,596  

Lennar Corp., Class B

    219,016       14,380,590  

LGI Homes Inc.(a)(b)

    313,692       36,441,600  
Security   Shares     Value  
Homebuilding (continued)            

M/I Homes Inc.(a)(b)

    405,472     $ 18,671,986  

MDC Holdings Inc.

    711,637       33,518,103  

Meritage Homes Corp.(a)(b)

    534,278       58,978,948  

NVR Inc.(a)

    49,440       201,869,453  

PulteGroup Inc.

    3,810,307       176,379,111  

Skyline Champion Corp.(a)

    740,708       19,828,753  

Taylor Morrison Home Corp.(a)

    1,842,728       45,312,681  

Toll Brothers Inc.

    1,631,463       79,386,989  

TopBuild Corp.(a)(b)

    470,012       80,226,348  

TRI Pointe Group Inc.(a)(b)

    1,851,685       33,589,566  
   

 

 

 
      1,609,561,577  
Specialty Chemicals — 4.3%            

Sherwin-Williams Co. (The)(b)

    151,111       105,285,078  
   

 

 

 
Trading Companies & Distributors — 1.8%  

Beacon Roofing Supply Inc.(a)(b)

    254,349       7,902,623  

Watsco Inc.

    153,308       35,703,900  
   

 

 

 
          43,606,523  
   

 

 

 

Total Common Stocks — 99.9%
(Cost: $2,155,916,854)

      2,436,898,118  
   

 

 

 

Short-Term Investments

   
Money Market Funds — 2.0%            

BlackRock Cash Funds: Institutional,

   

SL Agency Shares,
0.31%(c)(d)(e)

    47,109,074       47,151,472  

BlackRock Cash Funds: Treasury,

   

SL Agency Shares,
0.04%(c)(d)

    1,063,000       1,063,000  
   

 

 

 
      48,214,472  
   

 

 

 

Total Short-Term Investments — 2.0%
(Cost: $48,196,383)

 

    48,214,472  
   

 

 

 

Total Investments in Securities — 101.9%
(Cost: $2,204,113,237)

 

    2,485,112,590  

Other Assets, Less Liabilities — (1.9)%

      (47,045,236
   

 

 

 

Net Assets — 100.0%

    $   2,438,067,354  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period-end.

(e) 

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

 

 

C H E D U L E  O F  N V E S T M E N T  S   28


Schedule of Investments  (unaudited) (continued)

September 30, 2020

  

iShares® U.S. Home Construction ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended September 30, 2020, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
03/31/20
     Purchases
at Cost
    Proceeds
from Sales
    Net Realized
Gain (Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
09/30/20
     Shares
Held at
09/30/20
     Income     Capital
Gain
Distributions
from
Underlying
Funds
 

BlackRock Cash Funds: Institutional, SL Agency Shares

   $ 31,425,916      $ 15,704,444 (a)    $     $ 14,434      $ 6,678      $ 47,151,472        47,109,074      $ 82,204 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

     2,223,000              (1,160,000 )(a)                    1,063,000        1,063,000        764        
         

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 
          $ 14,434      $ 6,678      $ 48,214,472         $ 82,968     $  
         

 

 

    

 

 

    

 

 

       

 

 

   

 

 

 

 

  (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.

 

Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of September 30, 2020. The breakdown of the Fund’s investments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Investments

                 

Assets

                 

Common Stocks

   $ 2,436,898,118        $                 —        $                 —        $ 2,436,898,118  

Money Market Funds

     48,214,472                            48,214,472  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,485,112,590        $        $        $ 2,485,112,590  
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

29  

2 0 2 0  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, 2020

  

iShares® U.S. Infrastructure ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Aerospace & Defense — 0.7%            

Howmet Aerospace Inc.

    11,226     $ 187,699  
   

 

 

 
Aluminum — 0.6%            

Kaiser Aluminum Corp.

    3,083       165,218  
   

 

 

 
Building Products — 7.0%            

Advanced Drainage Systems Inc.

    3,581       223,598  

Apogee Enterprises Inc.

    9,475       202,481  

Armstrong World Industries Inc.

    2,782       191,429  

Builders FirstSource Inc.(a)(b)

    6,618       215,879  

Gibraltar Industries Inc.(a)

    3,170       206,494  

Insteel Industries Inc.

    11,038       206,410  

Owens Corning

    3,010       207,118  

Simpson Manufacturing Co. Inc.

    2,074       201,510  

Trex Co. Inc.(a)

    2,900       207,640  
   

 

 

 
          1,862,559  
Commodity Chemicals — 4.2%            

AdvanSix Inc.(a)

    14,336       184,648  

Hawkins Inc.

    4,011       184,907  

LyondellBasell Industries NV, Class A

    2,757       194,341  

Olin Corp.

    16,436       203,478  

Tredegar Corp.

    11,355       168,849  

Westlake Chemical Corp.

    3,162       199,901  
   

 

 

 
      1,136,124  
Construction & Engineering — 11.6%            

AECOM(a)

    5,178       216,648  

Aegion Corp.(a)

    12,419       175,480  

Argan Inc.

    4,699