LOGO

  OCTOBER 31, 2023

 

 

2023 Semi-Annual Report

(Unaudited)

 

 

iShares Trust

 

·  

iShares Core Dividend ETF | DIVB | Cboe BZX

 

·  

iShares Core Dividend Growth ETF | DGRO | NYSE Arca

 

·  

iShares Core High Dividend ETF | HDV | NYSE Arca

 

·  

iShares Select Dividend ETF | DVY | NASDAQ

 


The Markets in Review

Dear Shareholder,

The combination of continued economic growth and cooling inflation provided a supportive backdrop for investors during the 12-month reporting period ended October 31, 2023. Significantly tighter monetary policy helped to rein in inflation, as the annual increase in the Consumer Price Index declined to its long-term average of approximately 3% in October 2023. Meanwhile, real economic growth proved more resilient than many investors anticipated. A moderating labor market also helped ease inflationary pressure, although wages continued to grow and unemployment rates touched the lowest levels in decades before rising slightly. This robust labor market powered further growth in consumer spending, backstopping the economy. On October 7, 2023, Hamas launched a horrific attack on Israel. The ensuing war will have a significant humanitarian impact and could lead to heightened economic and market volatility. We see geopolitics as a structural market risk going forward. See our geopolitical risk dashboard at blackrock.com for more details.

Equity returns were solid during the period, as the durability of consumer spending mitigated investors’ concerns about the economy’s trajectory. The U.S. economy continued to show strength, and growth further accelerated in the third quarter of 2023. However, equity returns were uneven, as the performance of a few notable technology companies supported gains among large-capitalization U.S. stocks, while small-capitalization U.S. stocks declined overall. Meanwhile, international developed market equities advanced, and emerging market equities posted solid gains.

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

The U.S. Federal Reserve (the “Fed”), attempting to manage persistent inflation, raised interest rates six times during the 12-month period, but slowed and then paused its tightening later in the period. The Fed also wound down its bond-buying programs and incrementally reduced its balance sheet by not replacing securities that reach maturity.

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

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

Overall, our view is that investors need to think globally, position themselves to be prepared for a decarbonizing economy, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.

Sincerely,

 

LOGO

Rob Kapito

President, BlackRock, Inc.

LOGO

Rob Kapito

President, BlackRock, Inc.

 

Total Returns as of October 31, 2023  
       
         6-Month              12-Month  
   

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

    1.39             10.14
   

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

    (5.29             (8.56
   

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

    (7.88             14.40  
   

Emerging market equities (MSCI Emerging Markets Index)

    (4.78             10.80  
   

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

    2.63               4.77  
   

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

    (9.70             (3.25
   

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

    (6.13             0.36  
   

Tax-exempt municipal bonds (Bloomberg Municipal Bond Index)

    (4.65             2.64  
   

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

    0.02               6.23  

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

 

 

 

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


Table of Contents

 

      Page  

The Markets in Review

     2  

Semi-Annual Report:

  

Fund Summary

     4  

About Fund Performance

     8  

Disclosure of Expenses

     8  

Schedules of Investments

     9  

Financial Statements:

  

Statements of Assets and Liabilities

     30  

Statements of Operations

     31  

Statements of Changes in Net Assets

     32  

Financial Highlights

     34  

Notes to Financial Statements

     38  

Board Review and Approval of Investment Advisory Contract

     45  

Supplemental Information

     49  

General Information

     50  

Glossary of Terms Used in this Report

     51  

 

 

  3


Fund Summary   as of October 31, 2023       iShares® Core Dividend ETF

 

Investment Objective

The iShares Core Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. stocks with a history of dividend payments and/or share buybacks, as represented by the Morningstar® US Dividend and Buyback IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns     Cumulative Total Returns  
     6-Month Total
Returns
    1 Year     5 Years     Since
Inception
    1 Year     5 Years     Since
Inception
 

Fund NAV

    (2.06 )%      0.45     9.40     8.84     0.45     56.72     66.01

Fund Market

    (2.08     0.41       9.41       8.84       0.41       56.79       66.01  

Index

    (2.05     0.47       9.64       9.09       0.47       58.42       68.25  

The inception date of the Fund was November 7, 2017. The first day of secondary market trading was November 9, 2017.

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

 

Actual           Hypothetical 5% Return               
 

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
           

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
          

Annualized
Expense
Ratio
 
 
 
$ 1,000.00        $ 979.40        $ 0.25             $ 1,000.00        $ 1,024.89        $ 0.25              0.05

 

(a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION  
Sector    
Percent of
Total Investments
 
(a) 

Information Technology

    21.8

Financials

    18.4  

Health Care

    10.9  

Industrials

    9.8  

Energy

    9.5  

Consumer Staples

    9.2  

Consumer Discretionary

    6.0  

Communication Services

    4.8  

Materials

    3.4  

Real Estate

    3.1  

Utilities

    3.1  

 

(a) 

Excludes money market funds.

TEN LARGEST HOLDINGS  
Security    
Percent of
Total Investments
 
(a) 

Broadcom, Inc.

    5.0

Cisco Systems, Inc.

    4.6  

Exxon Mobil Corp.

    2.8  

International Business Machines Corp.

    2.5  

QUALCOMM, Inc.

    2.4  

Procter & Gamble Co. (The)

    2.1  

Texas Instruments, Inc.

    2.1  

Home Depot, Inc. (The)

    1.9  

JPMorgan Chase & Co.

    1.9  

Wells Fargo & Co.

    1.7  

 

 

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Fund Summary  as of  October 31, 2023       iShares® Core Dividend Growth ETF

 

Investment Objective

The iShares Core Dividend Growth ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities with a history of consistently growing dividends, as represented by the Morningstar® U.S. Dividend Growth IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns     Cumulative Total Returns  
     6-Month Total
Returns
    1 Year     5 Years     Since
Inception
    1 Year     5 Years     Since
Inception
 

Fund NAV

    (3.99 )%      1.01     9.20     9.80     1.01     55.30     140.62

Fund Market

    (3.99     0.95       9.20       9.80       0.95       55.27       140.62  

Index

    (3.98     1.02       9.28       9.87       1.02       55.83       141.94  

The inception date of the Fund was June 10, 2014. The first day of secondary market trading was June 12, 2014.

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

 

Actual           Hypothetical 5% Return               
 

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
           

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
          

Annualized
Expense
Ratio
 
 
 
$ 1,000.00        $ 960.10        $ 0.39             $ 1,000.00        $ 1,024.73        $ 0.41              0.08

 

(a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION  
Sector    
Percent of
Total Investments
 
(a) 

Health Care

    19.4

Financials

    18.8  

Information Technology

    15.6  

Industrials

    11.5  

Consumer Staples

    10.8  

Utilities

    6.9  

Energy

    6.8  

Consumer Discretionary

    6.0  

Materials

    2.7  

Communication Services

    1.5  

 

(a) 

Excludes money market funds.

TEN LARGEST HOLDINGS  
Security    
Percent of
Total Investments
 
(a) 

Microsoft Corp.

    3.2

JPMorgan Chase & Co.

    2.9  

Apple Inc.

    2.9  

Exxon Mobil Corp.

    2.8  

Johnson & Johnson

    2.8  

AbbVie, Inc.

    2.6  

Chevron Corp.

    2.4  

Procter & Gamble Co. (The)

    2.3  

Pfizer, Inc.

    2.1  

UnitedHealth Group, Inc.

    2.0  

 

 

F U N D   S U M M A R Y

  5


Fund Summary  as of  October 31, 2023    iShares® Core High Dividend ETF

 

Investment Objective

The iShares Core High Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Morningstar® Dividend Yield Focus IndexSM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

 

          Average Annual Total Returns     Cumulative Total Returns  
     6-Month Total
Returns
    1 Year     5 Years     10 Years     1 Year     5 Years     10 Years  

Fund NAV

    (5.31 )%      (3.46 )%      5.45     7.03     (3.46 )%      30.37     97.33

Fund Market

    (5.33     (3.51     5.44       7.03       (3.51     30.35       97.24  

Index

    (5.30     (3.41     5.52       7.14       (3.41     30.84       99.34  

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

 

Actual           Hypothetical 5% Return               
 

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
           

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
          

Annualized
Expense
Ratio
 
 
 
$ 1,000.00        $ 946.90        $ 0.39             $ 1,000.00        $ 1,024.73        $ 0.41              0.08

 

(a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION  
Sector    
Percent of
Total Investments
 
(a) 

Energy

    22.3

Health Care

    19.2  

Consumer Staples

    14.8  

Utilities

    10.4  

Communication Services

    9.4  

Information Technology

    9.3  

Financials

    8.3  

Industrials

    3.4  

Materials

    2.3  

Other (each representing less than 1%)

    0.6  

 

(a) 

Excludes money market funds.

TEN LARGEST HOLDINGS  
Security    
Percent of
Total Investments
 
(a) 

Exxon Mobil Corp.

    8.1

Verizon Communications, Inc.

    6.7  

Johnson & Johnson

    6.4  

AbbVie, Inc.

    6.0  

Chevron Corp.

    5.6  

Coca-Cola Co. (The)

    4.1  

PepsiCo, Inc.

    3.9  

Altria Group, Inc.

    3.7  

International Business Machines Corp.

    3.5  

Cisco Systems, Inc.

    3.5  

 

 

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Fund Summary  as of  October 31, 2023       iShares® Select Dividend ETF

 

Investment Objective

The iShares Select Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Dow Jones U.S. Select Dividend 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-Month Total
Returns
    1 Year     5 Years     10 Years     1 Year     5 Years     10 Years  

Fund NAV

    (9.13 )%      (7.93 )%      5.59     7.80     (7.93 )%      31.28     111.97

Fund Market

    (9.15     (7.99     5.58       7.79       (7.99     31.21       111.80  

Index

    (8.93     (7.53     6.02       8.24       (7.53     33.94       120.64  

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

 

Actual           Hypothetical 5% Return               
 

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
           

Beginning
Account Value
(05/01/23)
 
 
 
      

Ending
Account Value
(10/31/23)
 
 
 
      

Expenses
Paid During
the Period
 
 
(a) 
          

Annualized
Expense
Ratio
 
 
 
$ 1,000.00        $ 908.70        $ 1.84             $ 1,000.00        $ 1,023.21        $ 1.93              0.38

 

(a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

Portfolio Information

 

SECTOR ALLOCATION  
Sector    
Percent of
Total Investments
 
(a) 

Utilities

    27.3

Financials

    22.9  

Consumer Staples

    9.5  

Materials

    8.9  

Consumer Discretionary

    7.1  

Energy

    6.5  

Communication Services

    5.9  

Information Technology

    4.9  

Industrials

    3.7  

Health Care

    3.3  

 

(a) 

Excludes money market funds.

TEN LARGEST HOLDINGS  
Security    
Percent of
Total Investments
 
(a) 

Altria Group, Inc.

    2.5

Verizon Communications, Inc.

    2.3  

International Business Machines Corp.

    2.1  

ONEOK, Inc.

    2.0  

AT&T Inc.

    1.7  

Prudential Financial, Inc.

    1.7  

LyondellBasell Industries NV, Class A

    1.7  

Philip Morris International, Inc.

    1.7  

Seagate Technology Holdings PLC

    1.7  

International Paper Co.

    1.6  

 

 

 

F U N D   S U M M A R Y

  7


About Fund Performance   

 

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

Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. Beginning August 10, 2020, the price used to calculate market return (“Market Price”) is the closing price. Prior to August 10, 2020, Market Price was determined using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Since shares of a fund may not trade in the secondary market until after the fund’s inception, for the period from inception to the first day of secondary market trading in shares of the fund, the NAV of the fund is used as a proxy for the Market Price to calculate market returns. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.

An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.

Disclosure of Expenses

Shareholders of each Fund may incur the following charges: (1) transactional expenses, including brokerage commissions on purchases and sales of fund shares and (2) ongoing expenses, including management fees and other fund expenses. The expense examples shown (which are based on a hypothetical investment of $1,000 invested at the beginning of the period and held through the end of the period) are intended to assist shareholders both in calculating expenses based on an investment in each Fund and in comparing these expenses with similar costs of investing in other funds.

The expense examples provide information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”

The expense examples also provide information about hypothetical account values and hypothetical expenses based on a fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in the Funds and other funds, compare the 5% hypothetical examples with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

The expenses shown in the expense examples are intended to highlight shareholders’ ongoing costs only and do not reflect any transactional expenses, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing expenses only and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher.

 

 

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Schedule of Investments (unaudited)

October 31, 2023

  

iShares® Core Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Aerospace & Defense — 2.4%

 

General Dynamics Corp.

    2,691     $ 649,365  

Huntington Ingalls Industries, Inc.

    349       76,717  

L3Harris Technologies, Inc.

    4,656       835,333  

Lockheed Martin Corp.

    5,442       2,474,151  

RTX Corp.

    20,801       1,692,994  
   

 

 

 
      5,728,560  

Air Freight & Logistics — 1.2%

 

CH Robinson Worldwide, Inc.

    4,069       332,966  

FedEx Corp.

    2,683       644,189  

United Parcel Service, Inc., Class B

    12,781       1,805,316  
   

 

 

 
          2,782,471  

Automobile Components — 0.1%

 

Autoliv, Inc.

    806       73,870  

Dana, Inc.

    945       10,849  

LCI Industries

    276       29,943  

Lear Corp.

    600       77,856  
   

 

 

 
      192,518  

Automobiles — 0.3%

 

Ford Motor Co.

    62,851       612,797  

Harley-Davidson, Inc.

    2,667       71,609  

Thor Industries, Inc.

    662       58,210  
   

 

 

 
      742,616  

Banks — 8.5%

 

Associated Banc-Corp.

    2,245       36,392  

Atlantic Union Bankshares Corp.

    1,232       35,494  

Bank of America Corp.

    143,847       3,788,930  

Bank OZK

    2,931       104,959  

BOK Financial Corp.

    357       23,391  

Cadence Bank

    353       7,477  

Cathay General Bancorp

    1,460       49,509  

Citigroup, Inc.

    44,352       1,751,461  

Citizens Financial Group, Inc.

    11,347       265,860  

Columbia Banking System, Inc.

    519       10,209  

Comerica, Inc.

    2,551       100,509  

Commerce Bancshares, Inc.

    1,306       57,281  

Cullen/Frost Bankers, Inc.

    625       56,869  

CVB Financial Corp.

    2,352       36,738  

East West Bancorp, Inc.

    1,478       79,250  

Eastern Bankshares, Inc.

    2,963       32,623  

Fifth Third Bancorp

    13,241       313,944  

First Financial Bankshares, Inc.

    844       20,298  

First Hawaiian, Inc.

    2,067       37,061  

First Horizon Corp.

    9,649       103,727  

First Interstate BancSystem, Inc., Class A

    2,466       56,891  

FNB Corp.

    4,557       48,714  

Glacier Bancorp, Inc.

    1,195       36,077  

Hancock Whitney Corp.

    808       27,819  

Home BancShares, Inc.

    2,011       41,125  

Huntington Bancshares, Inc.

    26,565       256,352  

International Bancshares Corp.

    476       20,863  

JPMorgan Chase & Co.

    31,934       4,440,742  

KeyCorp

    24,308       248,428  

M&T Bank Corp.

    3,989       449,760  

New York Community Bancorp, Inc., Class A

    10,250       97,170  

Old National Bancorp

    3,500       47,950  

Pacific Premier Bancorp, Inc.

    361       6,859  

PNC Financial Services Group, Inc. (The)

    10,032       1,148,363  

Popular, Inc.

    1,706       110,958  

Prosperity Bancshares, Inc.

    1,260       68,720  
Security   Shares     Value  

Banks (continued)

 

Regions Financial Corp.

    13,828     $ 200,921  

ServisFirst Bancshares, Inc.

    239       11,271  

Simmons First National Corp., Class A

    2,333       33,152  

SouthState Corp.

    861       56,912  

Synovus Financial Corp.

    2,103       54,825  

Truist Financial Corp.

    25,170       713,821  

U.S. Bancorp

    17,936       571,800  

UMB Financial Corp.

    361       22,642  

United Bankshares, Inc.

    1,919       54,576  

United Community Banks, Inc.

    781       17,252  

Valley National Bancorp

    5,619       43,716  

Webster Financial Corp.

    2,729       103,620  

Wells Fargo & Co.

    103,208       4,104,582  

WSFS Financial Corp.

    714       25,276  
   

 

 

 
          20,033,139  

Beverages — 1.9%

 

Coca-Cola Co. (The)

    36,807       2,079,227  

Keurig Dr Pepper, Inc.

    8,138       246,826  

Molson Coors Beverage Co., Class B

    1,534       88,619  

PepsiCo, Inc.

    12,683       2,070,880  
   

 

 

 
      4,485,552  

Biotechnology — 3.2%

 

AbbVie, Inc.

    24,198       3,416,274  

Amgen, Inc.

    10,388       2,656,212  

Gilead Sciences, Inc.

    17,675       1,388,194  
   

 

 

 
          7,460,680  

Broadline Retail — 0.0%

 

Nordstrom, Inc.

    1,925       26,912  
   

 

 

 

Building Products — 0.5%

 

A O Smith Corp.

    1,913       133,451  

Fortune Brands Innovations, Inc.

    2,674       149,209  

Johnson Controls International PLC

    10,957       537,112  

Masco Corp.

    4,508       234,822  

Owens Corning

    1,764       199,985  
   

 

 

 
      1,254,579  

Capital Markets — 4.1%

 

Ameriprise Financial, Inc.

    1,853       582,898  

Ares Management Corp., Class A

    1,037       102,238  

Artisan Partners Asset Management, Inc., Class A

    951       31,383  

Bank of New York Mellon Corp. (The)

    18,038       766,615  

BlackRock, Inc.(a)

    1,700       1,040,876  

Blackstone, Inc., Class A, NVS

    7,112       656,793  

Blue Owl Capital, Inc., Class A

    4,251       52,415  

Carlyle Group, Inc. (The)

    3,146       86,641  

CME Group, Inc., Class A

    3,234       690,330  

Cohen & Steers, Inc.

    256       13,373  

Federated Hermes, Inc., Class B

    1,987       62,988  

Franklin Resources, Inc.

    3,803       86,670  

Goldman Sachs Group, Inc. (The)

    5,575       1,692,626  

Hamilton Lane, Inc., Class A

    359       30,199  

Houlihan Lokey, Inc., Class A

    578       58,100  

Invesco Ltd.

    8,775       113,812  

Janus Henderson Group PLC

    2,644       60,997  

Jefferies Financial Group, Inc.

    4,617       148,575  

Moelis & Co., Class A

    1,345       56,006  

Morgan Stanley

    34,301       2,429,197  

Northern Trust Corp.

    2,471       162,864  

State Street Corp.

    6,473       418,350  

 

 

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

  9


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Capital Markets (continued)

 

Stifel Financial Corp.

    1,302     $ 74,214  

T Rowe Price Group, Inc.

    4,151       375,665  
   

 

 

 
      9,793,825  

Chemicals — 1.9%

 

Air Products & Chemicals, Inc.

    1,486       419,706  

Ashland, Inc.

    1,739       133,260  

Avient Corp.

    805       25,454  

Celanese Corp., Class A

    1,175       134,549  

CF Industries Holdings, Inc.

    4,966       396,187  

Chemours Co. (The)

    4,402       106,132  

Dow, Inc.

    18,753       906,520  

DuPont de Nemours, Inc.

    12,571       916,175  

Eastman Chemical Co.

    4,691       350,558  

International Flavors & Fragrances, Inc.

    3,400       232,390  

LyondellBasell Industries NV, Class A

    4,817       434,686  

Mosaic Co. (The)

    11,433       371,344  

NewMarket Corp.

    135       65,090  

Scotts Miracle-Gro Co. (The)

    1,193       53,017  
   

 

 

 
      4,545,068  

Communications Equipment — 4.8%

 

Cisco Systems, Inc.

    209,057           10,898,141  

Juniper Networks, Inc.

    19,603       527,713  
   

 

 

 
      11,425,854  

Construction & Engineering — 0.0%

 

MDU Resources Group, Inc.

    2,502       46,562  
   

 

 

 

Consumer Finance — 0.3%

 

Discover Financial Services

    9,311       764,247  
   

 

 

 

Consumer Staples Distribution & Retail — 1.2%

 

Kroger Co. (The)

    10,313       467,901  

Sysco Corp.

    6,379       424,140  

Target Corp.

    13,536       1,499,653  

Walgreens Boots Alliance, Inc.

    19,493       410,912  
   

 

 

 
      2,802,606  

Containers & Packaging — 0.5%

 

Amcor PLC

    40,602       360,952  

Crown Holdings, Inc.

    2,588       208,593  

Greif, Inc., Class A, NVS

    366       23,241  

Greif, Inc., Class B

    103       6,598  

Packaging Corp. of America

    1,662       254,369  

Sealed Air Corp.

    2,897       89,199  

Sonoco Products Co.

    1,230       63,726  

Westrock Co.

    5,963       214,250  
   

 

 

 
      1,220,928  

Distributors — 0.2%

 

Genuine Parts Co.

    1,484       191,228  

LKQ Corp.

    5,916       259,831  
   

 

 

 
      451,059  

Diversified Consumer Services — 0.2%

 

ADT, Inc.

    1,583       8,960  

H&R Block, Inc.

    5,575       228,853  

Service Corp. International

    3,771       205,218  
   

 

 

 
      443,031  

Diversified REITs — 0.1%

 

WP Carey, Inc.

    3,040       163,096  
   

 

 

 

Diversified Telecommunication Services — 2.5%

 

AT&T Inc.

    168,580       2,596,132  
Security   Shares     Value  

Diversified Telecommunication Services (continued)

 

Cogent Communications Holdings, Inc.

    682     $ 44,317  

Verizon Communications, Inc.

    93,356       3,279,596  
   

 

 

 
      5,920,045  

Electric Utilities — 1.9%

 

Alliant Energy Corp.

    2,384       116,315  

American Electric Power Co., Inc.

    4,142       312,887  

Duke Energy Corp.

    10,362       921,078  

Edison International

    4,764       300,418  

Entergy Corp.

    1,158       110,693  

Evergy, Inc.

    3,085       151,597  

Eversource Energy

    3,910       210,319  

Exelon Corp.

    10,294       400,848  

FirstEnergy Corp.

    7,056       251,194  

Hawaiian Electric Industries, Inc.

    3,731       48,428  

IDACORP, Inc.

    495       46,881  

NRG Energy, Inc.

    5,160       218,681  

OGE Energy Corp.

    2,908       99,454  

Pinnacle West Capital Corp.

    1,531       113,570  

PNM Resources, Inc.

    903       38,161  

PPL Corp.

    8,199       201,449  

Southern Co. (The)

    9,104       612,699  

Xcel Energy, Inc.

    3,803       225,404  
   

 

 

 
      4,380,076  

Electrical Equipment — 0.3%

 

Emerson Electric Co.

    7,704       685,425  
   

 

 

 

Electronic Equipment, Instruments & Components — 0.5%

 

Avnet, Inc.

    5,857       271,355  

Corning, Inc.

    31,093       832,048  
   

 

 

 
      1,103,403  

Energy Equipment & Services — 0.2%

 

Baker Hughes Co., Class A

    10,363       356,695  

Helmerich & Payne, Inc.

    2,258       89,349  

Patterson-UTI Energy, Inc.

    2,679       34,023  
   

 

 

 
      480,067  

Entertainment — 0.0%

 

Warner Music Group Corp., Class A

    662       20,721  
   

 

 

 

Financial Services — 1.2%

 

Apollo Global Management, Inc.

    2,965       229,610  

Enact Holdings, Inc.

    287       7,910  

Essent Group Ltd.

    1,198       56,593  

Fidelity National Information Services, Inc.

    46,336       2,275,561  

MGIC Investment Corp.

    7,441       125,306  

TFS Financial Corp.

    964       11,433  

Voya Financial, Inc.

    3,195       213,330  

Walker & Dunlop, Inc.

    350       22,680  
   

 

 

 
          2,942,423  

Food Products — 1.3%

 

Archer-Daniels-Midland Co.

    8,215       587,947  

Bunge Ltd.

    1,007       106,722  

Cal-Maine Foods, Inc.

    1,251       56,683  

Campbell Soup Co.

    2,900       117,189  

Conagra Brands, Inc.

    7,422       203,066  

Flowers Foods, Inc.

    2,653       58,180  

General Mills, Inc.

    11,570       754,827  

Hormel Foods Corp.

    2,509       81,668  

Ingredion, Inc.

    729       68,220  

J M Smucker Co. (The)

    1,946       221,533  

Kellanova

    3,021       152,470  

 

 

10  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Food Products (continued)

 

Kraft Heinz Co. (The)

    11,434     $ 359,713  

Tyson Foods, Inc., Class A

    6,114       283,384  
   

 

 

 
      3,051,602  

Gas Utilities — 0.1%

 

National Fuel Gas Co.

    946       48,199  

New Jersey Resources Corp.

    888       36,035  

ONE Gas, Inc.

    278       16,791  

Spire, Inc.

    607       33,767  

UGI Corp.

    3,705       77,064  
   

 

 

 
      211,856  

Ground Transportation — 1.5%

 

Norfolk Southern Corp.

    5,637       1,075,483  

Ryder System, Inc.

    1,359       132,557  

Union Pacific Corp.

    11,029       2,289,731  
   

 

 

 
      3,497,771  

Health Care Equipment & Supplies — 0.6%

 

Baxter International, Inc.

    4,455       144,476  

Medtronic PLC

    17,277       1,219,065  
   

 

 

 
      1,363,541  

Health Care Providers & Services — 2.1%

 

Cardinal Health, Inc.

    6,714       610,974  

Cigna Group (The)

    7,941       2,455,357  

CVS Health Corp.

    21,272       1,467,981  

Patterson Cos., Inc.

    1,482       45,142  

Premier, Inc., Class A

    2,851       54,796  

Quest Diagnostics, Inc.

    2,652       345,025  
   

 

 

 
      4,979,275  

Health Care REITs — 0.3%

 

Healthpeak Properties, Inc.

    7,694       119,642  

Medical Properties Trust, Inc.

    25,777       123,214  

National Health Investors, Inc.

    1,338       66,954  

Omega Healthcare Investors, Inc.

    5,332       176,489  

Physicians Realty Trust

    1,538       16,703  

Sabra Health Care REIT, Inc.

    4,925       67,177  

Ventas, Inc.

    2,779       117,996  
   

 

 

 
      688,175  

Hotel & Resort REITs — 0.1%

 

Apple Hospitality REIT, Inc.

    3,892       61,027  

Host Hotels & Resorts, Inc.

    7,327       113,422  

Park Hotels & Resorts, Inc.

    6,538       75,383  
   

 

 

 
      249,832  

Hotels, Restaurants & Leisure — 0.6%

 

Bloomin’ Brands, Inc.

    1,596       37,251  

Cracker Barrel Old Country Store, Inc.

    885       58,729  

Darden Restaurants, Inc.

    2,619       381,143  

Domino’s Pizza, Inc.

    394       133,562  

Marriott Vacations Worldwide Corp.

    1,560       140,182  

Papa John’s International, Inc.

    908       59,038  

Red Rock Resorts, Inc., Class A

    2,061       81,512  

Travel + Leisure Co.

    3,033       103,213  

Vail Resorts, Inc.

    692       146,877  

Wendy’s Co. (The)

    4,016       76,384  

Wyndham Hotels & Resorts, Inc.

    1,820       131,768  
   

 

 

 
          1,349,659  

Household Durables — 0.3%

 

Garmin Ltd.

    4,897       502,089  

Leggett & Platt, Inc.

    2,909       68,158  

MDC Holdings, Inc.

    828       31,423  
Security   Shares     Value  

Household Durables (continued)

 

Newell Brands, Inc.

    6,634     $ 44,580  

Tempur Sealy International, Inc.

    4,185       167,107  
   

 

 

 
      813,357  

Household Products — 2.8%

 

Clorox Co. (The)

    1,138       133,943  

Colgate-Palmolive Co.

    11,324       850,659  

Energizer Holdings, Inc.

    1,006       31,769  

Kimberly-Clark Corp.

    3,950       472,578  

Procter & Gamble Co. (The)

    33,282       4,993,298  

Reynolds Consumer Products, Inc.

    606       15,411  

Spectrum Brands Holdings, Inc.

    1,496       112,679  
   

 

 

 
      6,610,337  

Independent Power and Renewable Electricity Producers — 0.1%

 

AES Corp. (The)

    7,358       109,634  

Clearway Energy, Inc., Class A

    693       14,117  

Clearway Energy, Inc., Class C

    1,524       33,086  
   

 

 

 
      156,837  

Industrial Conglomerates — 1.2%

 

3M Co.

    13,088       1,190,354  

Honeywell International, Inc.

    9,328       1,709,449  
   

 

 

 
      2,899,803  

Industrial REITs — 0.3%

 

LXP Industrial Trust

    2,203       17,426  

Prologis, Inc.

    7,352       740,714  
   

 

 

 
      758,140  

Insurance — 4.0%

 

Aflac, Inc.

    10,077       787,115  

Allstate Corp. (The)

    7,438       953,031  

American International Group, Inc.

    20,472       1,255,138  

Assurant, Inc.

    1,307       194,612  

Axis Capital Holdings Ltd.

    583       33,289  

Chubb Ltd.

    5,491       1,178,479  

Cincinnati Financial Corp.

    1,703       169,738  

CNO Financial Group, Inc.

    2,895       67,106  

Fidelity National Financial, Inc., Class A

    4,746       185,521  

First American Financial Corp.

    1,805       92,849  

Hanover Insurance Group, Inc. (The)

    338       39,617  

Hartford Financial Services Group, Inc. (The)

    7,118       522,817  

Kemper Corp.

    424       16,909  

MetLife, Inc.

    15,897       953,979  

Old Republic International Corp.

    4,569       125,099  

Principal Financial Group, Inc.

    5,105       345,506  

Prudential Financial, Inc.

    8,624       788,579  

Reinsurance Group of America, Inc.

    623       93,120  

Travelers Cos., Inc. (The)

    4,486       751,136  

Unum Group

    2,008       98,191  

Willis Towers Watson PLC

    3,650       860,999  
   

 

 

 
          9,512,830  

Interactive Media & Services — 0.0%

 

Shutterstock, Inc.

    421       17,126  
   

 

 

 

IT Services — 2.5%

 

International Business Machines Corp.

    40,145       5,806,573  
   

 

 

 

Leisure Products — 0.1%

 

Acushnet Holdings Corp.

    562       28,639  

Brunswick Corp.

    1,634       113,514  

Hasbro, Inc.

    1,697       76,620  

Polaris, Inc.

    1,207       104,309  
   

 

 

 
      323,082  

 

 

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

  11


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Machinery — 1.5%

 

Allison Transmission Holdings, Inc.

    2,123     $ 107,042  

Caterpillar, Inc.

    6,928       1,566,074  

Crane Co.

    646       62,875  

Cummins, Inc.

    1,517       328,127  

Flowserve Corp.

    758       27,834  

Hillenbrand, Inc.

    1,287       48,945  

Illinois Tool Works, Inc.

    3,319       743,854  

Kennametal, Inc.

    1,493       34,503  

Oshkosh Corp.

    343       30,091  

Snap-on, Inc.

    597       153,990  

Stanley Black & Decker, Inc.

    5,049       429,418  
   

 

 

 
          3,532,753  

Marine Transportation — 0.0%

 

Matson, Inc.

    1,322       115,080  
   

 

 

 

Media — 2.2%

 

Cable One, Inc.

    111       61,036  

Comcast Corp., Class A

    99,067       4,090,477  

Fox Corp., Class A, NVS

    8,993       273,297  

Fox Corp., Class B

    4,618       128,888  

Interpublic Group of Cos., Inc. (The)

    5,596       158,926  

John Wiley & Sons, Inc., Class A

    762       23,066  

Omnicom Group, Inc.

    4,905       367,434  

Paramount Global, Class A

    129       1,793  

Paramount Global, Class B, NVS

    8,605       93,622  

Sirius XM Holdings, Inc.

    13,856       59,304  

TEGNA, Inc.

    1,591       23,085  
   

 

 

 
      5,280,928  

Metals & Mining — 1.0%

 

Arch Resources, Inc., Class A

    541       81,599  

Newmont Corp.

    12,894       483,138  

Nucor Corp.

    6,059       895,460  

Southern Copper Corp.

    1,111       78,770  

Steel Dynamics, Inc.

    4,945       526,692  

United States Steel Corp.

    5,832       197,646  

Worthington Industries, Inc.

    300       18,486  
   

 

 

 
      2,281,791  

Mortgage Real Estate Investment Trusts (REITs) — 0.2%

 

AGNC Investment Corp.

    15,935       117,600  

Blackstone Mortgage Trust, Inc., Class A

    930       18,554  

Rithm Capital Corp.

    13,779       128,558  

Starwood Property Trust, Inc.

    5,400       95,850  
   

 

 

 
      360,562  

Multi-Utilities — 1.1%

 

Ameren Corp.

    1,661       125,754  

Black Hills Corp.

    300       14,505  

CenterPoint Energy, Inc.

    5,053       135,825  

CMS Energy Corp.

    3,355       182,311  

Consolidated Edison, Inc.

    5,418       475,646  

Dominion Energy, Inc.

    8,463       341,228  

DTE Energy Co.

    448       43,178  

Public Service Enterprise Group, Inc.

    5,453       336,177  

Sempra

    7,833       548,545  

WEC Energy Group, Inc.

    3,625       295,039  
   

 

 

 
      2,498,208  

Office REITs — 0.2%

 

Boston Properties, Inc.

    2,462       131,889  

COPT Defense Properties

    1,443       32,900  

Cousins Properties, Inc.

    2,441       43,621  

Douglas Emmett, Inc.

    4,088       45,827  

Highwoods Properties, Inc.

    2,506       44,832  
Security   Shares     Value  

Office REITs (continued)

   

Kilroy Realty Corp.

    1,893     $ 54,102  

Vornado Realty Trust

    2,840       54,528  
   

 

 

 
      407,699  

Oil, Gas & Consumable Fuels — 9.3%

 

Antero Midstream Corp.

    6,846       84,480  

APA Corp.

    9,075       360,459  

California Resources Corp.

    1,655       87,036  

Chevron Corp.

    16,702       2,433,982  

Chord Energy Corp.

    1,104       182,513  

Civitas Resources, Inc.

    555       41,864  

Comstock Resources, Inc.

    1,090       13,734  

ConocoPhillips

    21,223       2,521,292  

CONSOL Energy, Inc.

    304       27,935  

Coterra Energy, Inc.

    19,083       524,783  

CVR Energy, Inc.

    432       14,148  

Devon Energy Corp.

    19,299       898,754  

Diamondback Energy, Inc.

    4,175       669,336  

DT Midstream, Inc.

    1,371       73,993  

EOG Resources, Inc.

    4,487       566,484  

Equitrans Midstream Corp.

    7,332       65,035  

Exxon Mobil Corp.

    61,313       6,489,981  

HF Sinclair Corp.

    3,553       196,765  

Kinder Morgan, Inc.

    39,800       644,760  

Magnolia Oil & Gas Corp., Class A

    3,694       82,930  

Marathon Oil Corp.

    19,479       531,972  

Murphy Oil Corp.

    901       40,428  

New Fortress Energy, Inc., Class A

    1,481       44,874  

ONEOK, Inc.

    7,032       458,486  

Ovintiv, Inc.

    4,686       224,928  

Phillips 66

    8,225       938,226  

Pioneer Natural Resources Co.

    7,318       1,749,002  

Targa Resources Corp.

    2,028       169,561  

Valero Energy Corp.

    9,717       1,234,059  

Williams Cos., Inc. (The)

    16,767       576,785  
   

 

 

 
          21,948,585  

Pharmaceuticals — 5.0%

 

Bristol-Myers Squibb Co.

    53,345       2,748,868  

Johnson & Johnson

    27,103       4,020,459  

Merck & Co., Inc.

    21,426       2,200,450  

Organon & Co.

    4,206       62,207  

Perrigo Co. PLC

    1,241       34,301  

Pfizer, Inc.

    86,385       2,639,926  

Viatris, Inc.

    20,168       179,495  
   

 

 

 
      11,885,706  

Professional Services — 0.6%

 

Automatic Data Processing, Inc.

    4,085       891,429  

ManpowerGroup, Inc.

    1,349       94,389  

Paychex, Inc.

    2,773       307,942  

Robert Half, Inc.

    1,975       147,671  
   

 

 

 
      1,441,431  

Real Estate Management & Development — 0.0%

 

Kennedy-Wilson Holdings, Inc.

    2,720       35,006  
   

 

 

 

Residential REITs — 0.4%

   

Apartment Income REIT Corp.

    3,742       109,304  

AvalonBay Communities, Inc.

    1,058       175,353  

Equity LifeStyle Properties, Inc.

    1,010       66,458  

Equity Residential

    4,029       222,924  

Essex Property Trust, Inc.

    902       192,956  

 

 

12  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Residential REITs (continued)

 

Invitation Homes, Inc.

    777     $ 23,069  

Mid-America Apartment Communities, Inc.

    1,314       155,249  
   

 

 

 
      945,313  

Retail REITs — 0.5%

 

Brixmor Property Group, Inc.

    3,775       78,482  

Federal Realty Investment Trust

    438       39,941  

Kimco Realty Corp.

    8,051       144,435  

Kite Realty Group Trust

    2,887       61,551  

Macerich Co. (The)

    3,086       29,996  

NNN REIT, Inc.

    1,986       72,151  

Regency Centers Corp.

    1,872       112,807  

Simon Property Group, Inc.

    6,193       680,549  

SITE Centers Corp.

    2,450       28,567  
   

 

 

 
      1,248,479  

Semiconductors & Semiconductor Equipment — 12.3%

 

Broadcom, Inc.

    14,114       11,875,096  

Intel Corp.

    103,036       3,760,814  

NXP Semiconductors NV

    12,512       2,157,444  

QUALCOMM, Inc.

    51,294       5,590,533  

Skyworks Solutions, Inc.

    8,770       760,710  

Texas Instruments, Inc.

    34,820       4,944,788  
   

 

 

 
          29,089,385  

Software — 0.2%

 

Gen Digital, Inc.

    32,582       542,816  
   

 

 

 

Specialized REITs — 1.2%

 

American Tower Corp.

    2,840       506,060  

Crown Castle, Inc.

    8,009       744,677  

Digital Realty Trust, Inc.

    1,204       149,729  

EPR Properties

    1,697       72,462  

Extra Space Storage, Inc.

    2,876       297,925  

Gaming & Leisure Properties, Inc.

    646       29,322  

Iron Mountain, Inc.

    3,287       194,163  

Lamar Advertising Co., Class A

    1,390       114,355  

Outfront Media, Inc.

    4,681       45,687  

PotlatchDeltic Corp.

    1,076       46,107  

Public Storage

    1,662       396,736  

Rayonier, Inc.

    810       20,444  

Weyerhaeuser Co.

    8,232       236,176  
   

 

 

 
      2,853,843  

Specialty Retail — 3.8%

 

American Eagle Outfitters, Inc.

    4,144       72,396  

Dick’s Sporting Goods, Inc.

    2,713       290,155  

Gap, Inc. (The)

    5,318       68,070  

Home Depot, Inc. (The)

    15,823       4,504,650  

Lowe’s Cos., Inc.

    19,240       3,666,567  

Penske Automotive Group, Inc.

    578       82,700  

Williams-Sonoma, Inc.

    2,416       362,980  
   

 

 

 
      9,047,518  
Security   Shares     Value  

Technology Hardware, Storage & Peripherals — 1.5%

 

Hewlett Packard Enterprise Co.

    61,627     $ 947,823  

NetApp, Inc.

    15,195       1,105,892  

Seagate Technology Holdings PLC

    20,487       1,398,238  
   

 

 

 
      3,451,953  

Textiles, Apparel & Luxury Goods — 0.3%

 

Kontoor Brands, Inc.

    1,171       54,393  

Ralph Lauren Corp., Class A

    1,558       175,322  

Steven Madden Ltd.

    1,764       57,842  

Tapestry, Inc.

    12,806       352,933  

VF Corp.

    10,076       148,419  
   

 

 

 
      788,909  

Tobacco — 1.9%

 

Altria Group, Inc.

    55,931       2,246,748  

Philip Morris International, Inc.

    26,054       2,322,975  
   

 

 

 
      4,569,723  

Trading Companies & Distributors — 0.5%

 

Fastenal Co.

    4,678       272,915  

Ferguson PLC

    4,403       661,331  

Herc Holdings, Inc.

    350       37,376  

MSC Industrial Direct Co., Inc., Class A

    656       62,156  

Watsco, Inc.

    280       97,689  
   

 

 

 
      1,131,467  

Water Utilities — 0.0%

 

Essential Utilities, Inc.

    779       26,065  
   

 

 

 

Total Long-Term Investments — 99.6%
(Cost: $253,917,345)

 

      235,668,479  
   

 

 

 
Short-Term Securities  
Money Market Funds — 0.4%            

BlackRock Cash Funds: Treasury, SL Agency Shares, 5.33%(a)(b)

    863,690       863,690  
   

 

 

 

Total Short-Term Securities — 0.4%
(Cost: $863,690)

 

    863,690  
   

 

 

 

Total Investments — 100.0%
(Cost: $254,781,035)

 

    236,532,169  

Liabilities in Excess of Other Assets — (0.0)%

 

    (30,765
   

 

 

 

Net Assets — 100.0%

 

  $ 236,501,404  
   

 

 

 

 

(a) 

Affiliate of the Fund.

(b) 

Annualized 7-day yield as of period end.

 

 

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

  13


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    
Value at
04/30/23
 
 
   
Purchases
at Cost
 
 
   
Proceeds
from Sale
 
 
   
Net Realized
Gain (Loss)
 
 
   


Change in
Unrealized
Appreciation
(Depreciation)
 
 
 
 
   
Value at
10/31/23
 
 
   

Shares
Held at
10/31/23
 
 
 
    Income      




Capital

Gain
Distributions
from Underlying
Funds

 


 
 
 

BlackRock Cash Funds: Treasury, SL Agency Shares

  $ 859,810     $ 3,880 (a)    $     $     $     $ 863,690       863,690     $ 20,550     $  

BlackRock, Inc.

    1,322,935       104,745       (299,318     (34,925     (52,561     1,040,876       1,700       17,795        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ (34,925   $ (52,561   $   1,904,566       $   38,345     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

 

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

 

 
Long Contracts                                

Micro E-Mini S&P 500 Index

     38          12/15/23        $800      $ (25,025
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

 

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

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 25,025      $      $      $      $   25,025  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

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

 

For the period ended October 31, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

 

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

 

 

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $ 3,505      $      $      $      $ 3,505  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $ (42,854    $      $      $        $  (42,854
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

 

 
Futures contracts       

Average notional value of contracts — long

   $ 1,000,049  

 

 

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

 

 

14  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend ETF

 

Fair Value Hierarchy as of Period End

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

The following table summarizes the Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 235,668,479        $        $        $ 235,668,479  

Short-Term Securities

                 

Money Market Funds

     863,690                            863,690  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $         236,532,169        $                         —        $                         —        $         236,532,169  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (25,025      $        $        $ (25,025
  

 

 

      

 

 

      

 

 

      

 

 

 

 

(a) 

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

 

See notes to financial statements.

 

 

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

  15


Schedule of Investments (unaudited)

October 31, 2023

  

iShares® Core Dividend Growth ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Aerospace & Defense — 2.6%

 

BWX Technologies, Inc.

    67,675     $ 5,026,899  

Curtiss-Wright Corp.

    10,143       2,016,530  

General Dynamics Corp.

    317,569       76,632,575  

HEICO Corp.

    3,786       599,740  

HEICO Corp., Class A

    7,445       946,483  

Huntington Ingalls Industries, Inc.

    54,291       11,934,248  

L3Harris Technologies, Inc.

    295,047       52,934,382  

Lockheed Martin Corp.

    371,581       168,935,586  

Northrop Grumman Corp.

    147,001       69,300,682  

RTX Corp.

    2,405,259       195,764,030  
   

 

 

 
      584,091,155  

Air Freight & Logistics — 1.2%

 

CH Robinson Worldwide, Inc.

    190,199       15,563,984  

Expeditors International of Washington, Inc.

    105,994       11,579,845  

Forward Air Corp.

    20,513       1,321,242  

United Parcel Service, Inc., Class B

    1,685,513           238,078,711  
   

 

 

 
      266,543,782  

Automobile Components — 0.0%

 

Gentex Corp.

    202,220       5,799,670  
   

 

 

 

Automobiles — 0.0%

 

Thor Industries, Inc.

    54,804       4,818,916  
   

 

 

 

Banks — 8.2%

 

Associated Banc-Corp.

    441,602       7,158,368  

Atlantic Union Bankshares Corp.

    130,119       3,748,728  

BancFirst Corp.

    18,491       1,499,805  

Bank of America Corp.

    13,656,795       359,719,980  

Bank OZK

    232,243       8,316,622  

BOK Financial Corp.

    44,614       2,923,109  

Cadence Bank

    145,900       3,090,162  

Cathay General Bancorp

    153,149       5,193,283  

Citigroup, Inc.

    5,811,281       229,487,487  

Comerica, Inc.

    469,949       18,515,991  

Commerce Bancshares, Inc.

    150,322       6,593,123  

Community Bank System, Inc.

    101,405       4,051,130  

Cullen/Frost Bankers, Inc.

    148,718       13,531,851  

CVB Financial Corp.

    344,693       5,384,105  

East West Bancorp, Inc.

    298,453       16,003,050  

Fifth Third Bancorp

    1,976,296       46,857,978  

First Bancorp

    367,396       4,904,737  

First Financial Bankshares, Inc.

    199,086       4,788,018  

First Horizon Corp.

    1,585,168       17,040,556  

Glacier Bancorp, Inc.

    294,106       8,879,060  

Home BancShares, Inc.

    360,278       7,367,685  

Independent Bank Corp.

    69,304       3,382,035  

JPMorgan Chase & Co.

    4,697,280       653,203,757  

M&T Bank Corp.

    414,378       46,721,120  

PNC Financial Services Group, Inc. (The)

    1,217,880       139,410,724  

Popular, Inc.

    144,912       9,425,076  

Prosperity Bancshares, Inc.

    214,657       11,707,393  

Regions Financial Corp.

    2,910,061       42,283,186  

ServisFirst Bancshares, Inc.

    68,585       3,234,469  

Simmons First National Corp., Class A

    262,560       3,730,978  

SouthState Corp.

    130,272       8,610,979  

Synovus Financial Corp.

    424,793       11,074,354  

U.S. Bancorp

    4,319,418       137,703,046  

UMB Financial Corp.

    63,334       3,972,308  

United Community Banks, Inc.

    232,614       5,138,443  

Wintrust Financial Corp.

    74,663       5,576,579  
Security   Shares     Value  

Banks (continued)

 

WSFS Financial Corp.

    31,138     $ 1,102,285  

Zions Bancorp N.A.

    408,064       12,588,774  
   

 

 

 
      1,873,920,334  

Beverages — 3.6%

 

Brown-Forman Corp., Class A

    42,675       2,450,398  

Brown-Forman Corp., Class B, NVS

    138,714       7,790,178  

Coca-Cola Co. (The)

    7,097,175       400,919,416  

Constellation Brands, Inc., Class A

    129,026       30,211,438  

PepsiCo, Inc.

    2,324,056       379,471,864  
   

 

 

 
      820,843,294  

Biotechnology — 4.8%

 

AbbVie, Inc.

    4,178,391       589,905,241  

Amgen, Inc.

    1,065,013       272,323,824  

Gilead Sciences, Inc.

    2,936,246       230,612,761  
   

 

 

 
          1,092,841,826  

Broadline Retail — 0.0%

 

Dillard’s, Inc., Class A

    880       273,196  
   

 

 

 

Building Products — 0.5%

 

A O Smith Corp.

    120,968       8,438,728  

AAON, Inc.

    18,806       1,024,551  

Advanced Drainage Systems, Inc.

    18,857       2,014,493  

Allegion PLC

    85,377       8,397,682  

Carlisle Cos., Inc.

    39,479       10,031,219  

Fortune Brands Innovations, Inc.

    102,919       5,742,880  

Lennox International, Inc.

    21,891       8,111,491  

Masco Corp.

    260,380       13,563,194  

Owens Corning

    76,919       8,720,307  

Simpson Manufacturing Co., Inc.

    19,455       2,591,017  

Trane Technologies PLC

    194,870       37,085,710  

UFP Industries, Inc.

    42,297       4,025,405  
   

 

 

 
      109,746,677  

Capital Markets — 5.0%

 

Ameriprise Financial, Inc.

    96,228       30,270,442  

Bank of New York Mellon Corp. (The)

    1,569,713       66,712,802  

BlackRock, Inc.(a)

    251,439       153,951,071  

CME Group, Inc., Class A

    452,766       96,647,430  

Cohen & Steers, Inc.

    54,222       2,832,557  

Evercore, Inc., Class A

    45,422       5,913,036  

FactSet Research Systems, Inc.

    20,377       8,800,623  

Goldman Sachs Group, Inc. (The)

    663,322       201,391,192  

Hamilton Lane, Inc., Class A

    44,780       3,766,894  

Houlihan Lokey, Inc., Class A

    62,375       6,269,935  

Intercontinental Exchange, Inc.

    481,318       51,712,806  

Jefferies Financial Group, Inc.

    355,925       11,453,667  

MarketAxess Holdings, Inc.

    27,748       5,931,135  

Moody’s Corp.

    83,510       25,721,080  

Morgan Stanley

    3,065,620       217,107,208  

Morningstar, Inc.

    8,843       2,239,401  

MSCI, Inc., Class A

    47,709       22,497,179  

Nasdaq, Inc.

    338,060       16,767,776  

Northern Trust Corp.

    475,949       31,369,799  

Raymond James Financial, Inc.

    178,325       17,019,338  

S&P Global, Inc.

    174,060       60,800,899  

SEI Investments Co.

    87,989       4,721,490  

State Street Corp.

    700,920       45,300,460  

Stifel Financial Corp.

    137,682       7,847,874  

T Rowe Price Group, Inc.

    571,289       51,701,654  
   

 

 

 
      1,148,747,748  

Chemicals — 2.0%

 

Air Products & Chemicals, Inc.

    308,920       87,251,365  

 

 

16  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Chemicals (continued)

 

Albemarle Corp.

    57,833     $ 7,332,068  

Ashland, Inc.

    50,203       3,847,056  

Avient Corp.

    126,815       4,009,890  

Balchem Corp.

    9,978       1,159,843  

Cabot Corp.

    72,706       4,833,495  

Celanese Corp., Class A

    129,246       14,799,959  

Eastman Chemical Co.

    266,295       19,900,225  

Ecolab, Inc.

    169,188       28,379,595  

HB Fuller Co.

    37,732       2,495,972  

Innospec, Inc.

    19,353       1,896,594  

International Flavors & Fragrances, Inc.

    676,924       46,267,755  

Linde PLC

    379,454       145,012,141  

NewMarket Corp.

    8,093       3,902,040  

PPG Industries, Inc.

    259,525       31,861,884  

Quaker Chemical Corp.

    6,988       1,004,315  

RPM International, Inc.

    129,289       11,800,207  

Sensient Technologies Corp.

    62,628       3,533,472  

Sherwin-Williams Co. (The)

    122,687       29,225,270  

Stepan Co.

    22,532       1,685,394  

Westlake Corp.

    31,525       3,636,724  
   

 

 

 
      453,835,264  

Commercial Services & Supplies — 0.6%

 

ABM Industries, Inc.

    75,945       2,987,676  

Brady Corp., Class A, NVS

    48,976       2,520,305  

Cintas Corp.

    55,132       27,958,540  

MSA Safety, Inc.

    22,986       3,629,030  

Republic Services, Inc.

    164,075       24,363,497  

Tetra Tech, Inc.

    20,689       3,122,177  

Veralto Corp.(b)

    54,136       3,735,384  

Waste Management, Inc.

    386,392       63,495,797  
   

 

 

 
          131,812,406  

Communications Equipment — 1.6%

 

Cisco Systems, Inc.

    6,511,539       339,446,528  

Motorola Solutions, Inc.

    122,190       34,025,027  
   

 

 

 
      373,471,555  

Construction & Engineering — 0.0%

 

Comfort Systems U.S.A., Inc.

    10,429       1,896,513  

MDU Resources Group, Inc.

    536,134       9,977,454  
   

 

 

 
      11,873,967  

Construction Materials — 0.1%

 

Martin Marietta Materials, Inc.

    24,558       10,042,749  

Vulcan Materials Co.

    61,935       12,169,608  
   

 

 

 
      22,212,357  

Consumer Finance — 0.6%

 

American Express Co.

    526,491       76,883,481  

Discover Financial Services

    451,768       37,081,117  

FirstCash Holdings, Inc.

    32,125       3,499,055  

Nelnet, Inc., Class A

    11,564       980,743  

Synchrony Financial

    790,316       22,168,364  
   

 

 

 
      140,612,760  

Consumer Staples Distribution & Retail — 2.3%

 

Casey’s General Stores, Inc.

    15,902       4,323,913  

Costco Wholesale Corp.

    192,713       106,462,370  

Dollar General Corp.

    239,159       28,469,487  

Kroger Co. (The)

    975,159       44,242,964  

Sysco Corp.

    860,642       57,224,087  

Target Corp.

    956,241       105,941,940  

Walmart, Inc.

    1,153,701       188,526,280  
   

 

 

 
      535,191,041  
Security   Shares     Value  

Containers & Packaging — 0.2%

 

AptarGroup, Inc.

    50,909     $ 6,224,644  

Avery Dennison Corp.

    82,844       14,420,655  

Ball Corp.

    277,956       13,383,581  

Silgan Holdings, Inc.

    81,638       3,270,418  

Sonoco Products Co.

    211,667       10,966,467  
   

 

 

 
      48,265,765  

Distributors — 0.2%

 

Genuine Parts Co.

    205,874       26,528,924  

Pool Corp.

    28,528       9,008,286  
   

 

 

 
      35,537,210  

Diversified Consumer Services — 0.1%

 

Graham Holdings Co., Class B

    2,623       1,517,982  

H&R Block, Inc.

    265,656       10,905,179  

Service Corp. International

    154,042       8,382,966  
   

 

 

 
      20,806,127  

Electric Utilities — 4.4%

 

ALLETE, Inc.

    166,586       8,919,014  

Alliant Energy Corp.

    536,759       26,188,472  

American Electric Power Co., Inc.

    1,303,594       98,473,491  

Duke Energy Corp.

    2,103,820       187,008,560  

Edison International

    969,841       61,158,174  

Entergy Corp.

    562,800       53,798,052  

Evergy, Inc.

    613,667       30,155,596  

Eversource Energy

    897,930       48,299,655  

IDACORP, Inc.

    98,392       9,318,706  

MGE Energy, Inc.

    47,415       3,396,336  

NextEra Energy, Inc.

    3,355,351       195,616,963  

Otter Tail Corp.

    58,198       4,477,754  

PNM Resources, Inc.

    166,723       7,045,714  

Portland General Electric Co.

    248,665       9,951,573  

Southern Co. (The)

    2,684,515       180,667,860  

Xcel Energy, Inc.

    1,184,619       70,212,368  
   

 

 

 
      994,688,288  

Electrical Equipment — 0.9%

 

AMETEK, Inc.

    85,282       12,005,147  

Eaton Corp. PLC

    344,073       71,536,217  

Emerson Electric Co.

    702,413       62,493,685  

Hubbell, Inc.

    44,121       11,917,082  

nVent Electric PLC

    121,515       5,848,517  

Regal Rexnord Corp.

    33,477       3,964,012  

Rockwell Automation, Inc.

    102,215       26,863,124  
   

 

 

 
          194,627,784  

Electronic Equipment, Instruments & Components — 0.6%

 

Amphenol Corp., Class A

    332,572       26,788,675  

Avnet, Inc.

    124,747       5,779,529  

Badger Meter, Inc.

    10,138       1,404,620  

CDW Corp.

    87,206       17,476,082  

Cognex Corp.

    56,931       2,048,947  

Corning, Inc.

    1,570,586       42,028,881  

Littelfuse, Inc.

    14,566       3,156,015  

TD SYNNEX Corp.

    36,068       3,306,714  

TE Connectivity Ltd.

    332,370       39,169,804  
   

 

 

 
      141,159,267  

Financial Services — 1.6%

 

Equitable Holdings, Inc.

    608,283       16,162,079  

Fidelity National Information Services, Inc.

    1,294,971       63,596,026  

Jack Henry & Associates, Inc.

    57,343       8,084,790  

Mastercard, Inc., Class A

    268,873       101,190,353  

 

 

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

  17


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Financial Services (continued)

 

Visa, Inc., Class A

    689,317     $ 162,058,427  

Walker & Dunlop, Inc.

    59,430       3,851,064  
   

 

 

 
      354,942,739  

Food Products — 1.6%

 

Archer-Daniels-Midland Co.

    735,800       52,661,206  

Flowers Foods, Inc.

    459,985       10,087,471  

Hershey Co. (The)

    194,159       36,375,689  

Hormel Foods Corp.

    500,458       16,289,908  

Ingredion, Inc.

    109,290       10,227,358  

J & J Snack Foods Corp.

    15,029       2,353,692  

J M Smucker Co. (The)

    187,473       21,341,926  

Kellanova

    604,205       30,494,226  

Lamb Weston Holdings, Inc.

    98,601       8,854,370  

Lancaster Colony Corp.

    24,112       4,079,027  

McCormick & Co., Inc., NVS

    285,760       18,260,064  

Mondelez International, Inc., Class A

    1,752,951       116,062,886  

Tyson Foods, Inc., Class A

    622,143       28,836,328  

WK Kellogg Co.(b)

    151,179       1,514,813  
   

 

 

 
          357,438,964  

Gas Utilities — 0.4%

 

Atmos Energy Corp.

    222,968       24,004,735  

Chesapeake Utilities Corp.

    22,802       2,020,485  

National Fuel Gas Co.

    206,847       10,538,855  

New Jersey Resources Corp.

    213,952       8,682,172  

ONE Gas, Inc.

    114,834       6,935,974  

Southwest Gas Holdings, Inc.

    158,189       9,271,457  

Spire, Inc.

    151,589       8,432,896  

UGI Corp.

    735,159       15,291,307  
   

 

 

 
      85,177,881  

Ground Transportation — 1.4%

 

CSX Corp.

    1,755,705       52,407,794  

JB Hunt Transport Services, Inc.

    43,730       7,515,875  

Landstar System, Inc.

    15,125       2,492,298  

Norfolk Southern Corp.

    361,125       68,899,039  

Old Dominion Freight Line, Inc.

    19,835       7,471,051  

Ryder System, Inc.

    77,210       7,531,063  

Schneider National, Inc., Class B

    31,183       789,865  

Union Pacific Corp.

    867,800       180,163,958  

Werner Enterprises, Inc.

    41,696       1,514,399  
   

 

 

 
      328,785,342  

Health Care Equipment & Supplies — 2.4%

 

Abbott Laboratories

    2,034,680       192,378,994  

Baxter International, Inc.

    860,553       27,907,734  

Becton Dickinson & Co.

    225,437       56,985,965  

DENTSPLY SIRONA, Inc.

    189,670       5,767,865  

Medtronic PLC

    2,650,164       186,995,572  

ResMed, Inc.

    107,554       15,188,776  

STERIS PLC

    48,760       10,238,625  

Stryker Corp.

    204,685       55,309,980  
   

 

 

 
      550,773,511  

Health Care Providers & Services — 3.0%

 

Cardinal Health, Inc.

    339,568       30,900,688  

Cencora, Inc.

    105,532       19,539,250  

Chemed Corp.

    2,478       1,394,247  

Elevance Health, Inc.

    183,282       82,493,395  

Encompass Health Corp.

    49,651       3,106,166  

Ensign Group, Inc. (The)

    8,891       858,871  

HCA Healthcare, Inc.

    104,819       23,703,769  

Humana, Inc.

    55,668       29,152,775  

McKesson Corp.

    47,828       21,778,958  
Security   Shares     Value  

Health Care Providers & Services (continued)

 

Quest Diagnostics, Inc.

    146,271     $ 19,029,857  

UnitedHealth Group, Inc.

    855,029       457,919,331  
   

 

 

 
      689,877,307  

Hotels, Restaurants & Leisure — 1.9%

 

Domino’s Pizza, Inc.

    26,086       8,842,893  

McDonald’s Corp.

    938,723       246,105,009  

Starbucks Corp.

    1,475,487       136,098,921  

Texas Roadhouse, Inc.

    85,318       8,663,190  

Wingstop, Inc.

    9,978       1,823,679  

Yum! Brands, Inc.

    310,599       37,538,995  
   

 

 

 
      439,072,687  

Household Durables — 0.2%

 

DR Horton, Inc.

    156,163       16,303,417  

Garmin Ltd.

    252,276       25,865,858  
   

 

 

 
      42,169,275  

Household Products — 3.1%

 

Church & Dwight Co., Inc.

    168,143       15,290,924  

Colgate-Palmolive Co.

    1,283,328       96,403,599  

Kimberly-Clark Corp.

    733,069       87,704,375  

Procter & Gamble Co. (The)

    3,395,652       509,449,670  

WD-40 Co.

    13,664       2,888,570  
   

 

 

 
          711,737,138  

Independent Power and Renewable Electricity Producers — 0.1%

 

AES Corp. (The)

    1,490,970       22,215,453  
   

 

 

 

Industrial Conglomerates — 0.7%

 

Honeywell International, Inc.

    865,603       158,630,406  
   

 

 

 

Insurance — 3.3%

 

Aflac, Inc.

    723,560       56,517,272  

Allstate Corp. (The)

    503,952       64,571,370  

American Equity Investment Life Holding Co.(b)

    24,708       1,308,536  

American Financial Group, Inc.

    90,861       9,936,559  

Aon PLC, Class A

    87,956       27,213,586  

Arthur J. Gallagher & Co.

    120,245       28,316,495  

Assurant, Inc.

    63,263       9,419,861  

Assured Guaranty Ltd.

    65,270       4,072,848  

Axis Capital Holdings Ltd.

    146,873       8,386,448  

Brown & Brown, Inc.

    87,066       6,044,122  

Chubb Ltd.

    411,020       88,213,113  

Cincinnati Financial Corp.

    262,388       26,152,212  

CNO Financial Group, Inc.

    171,520       3,975,834  

Erie Indemnity Co., Class A, NVS

    25,427       7,022,683  

Everest Group Ltd.

    45,246       17,900,223  

First American Financial Corp.

    203,875       10,487,330  

Globe Life, Inc.

    43,583       5,071,318  

Hanover Insurance Group, Inc. (The)

    63,767       7,474,130  

Hartford Financial Services Group, Inc. (The)

    426,692       31,340,527  

Kinsale Capital Group, Inc.

    2,142       715,235  

Marsh & McLennan Cos., Inc.

    422,325       80,093,936  

MetLife, Inc.

    1,234,112       74,059,061  

Old Republic International Corp.

    580,458       15,892,940  

Primerica, Inc.

    29,007       5,544,978  

Principal Financial Group, Inc.

    441,109       29,854,257  

Reinsurance Group of America, Inc.

    95,183       14,227,003  

RenaissanceRe Holdings Ltd.

    22,692       4,982,936  

RLI Corp.

    19,342       2,577,128  

Selective Insurance Group, Inc.

    42,198       4,393,234  

Travelers Cos., Inc. (The)

    334,330       55,980,215  

Unum Group

    325,546       15,919,199  

 

 

18  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Insurance (continued)

 

W. R. Berkley Corp.

    81,689     $ 5,507,472  

Willis Towers Watson PLC

    99,683       23,514,223  
   

 

 

 
          746,686,284  

IT Services — 0.7%

 

Accenture PLC, Class A

    504,996       150,029,262  
   

 

 

 

Leisure Products — 0.1%

 

Acushnet Holdings Corp.

    30,070       1,532,367  

Brunswick Corp.

    85,382       5,931,487  

Polaris, Inc.

    75,180       6,497,056  
   

 

 

 
      13,960,910  

Life Sciences Tools & Services — 0.3%

 

Agilent Technologies, Inc.

    133,640       13,814,367  

Danaher Corp.

    162,040       31,114,921  

Thermo Fisher Scientific, Inc.

    58,814       26,158,703  

West Pharmaceutical Services, Inc.

    8,185       2,605,203  
   

 

 

 
      73,693,194  

Machinery — 2.3%

 

AGCO Corp.

    33,870       3,883,534  

Caterpillar, Inc.

    551,730       124,718,567  

Cummins, Inc.

    234,687       50,762,798  

Donaldson Co., Inc.

    112,106       6,464,032  

Dover Corp.

    115,014       14,946,069  

Franklin Electric Co., Inc.

    21,016       1,822,508  

Graco, Inc.

    120,296       8,944,008  

Hillenbrand, Inc.

    78,144       2,971,816  

IDEX Corp.

    51,070       9,775,309  

Illinois Tool Works, Inc.

    345,885       77,519,746  

Ingersoll Rand, Inc.

    30,962       1,878,774  

ITT, Inc.

    55,492       5,180,178  

Kadant, Inc.

    4,074       896,280  

Lincoln Electric Holdings, Inc.

    46,287       8,090,968  

Nordson Corp.

    35,806       7,611,998  

Oshkosh Corp.

    61,150       5,364,690  

Otis Worldwide Corp.

    387,148       29,891,697  

PACCAR, Inc.

    398,289       32,870,791  

Parker-Hannifin Corp.

    107,125       39,519,484  

Pentair PLC

    121,987       7,089,884  

Snap-on, Inc.

    76,427       19,713,580  

Stanley Black & Decker, Inc.

    305,904       26,017,135  

Terex Corp.

    41,558       1,903,356  

Timken Co. (The)

    67,201       4,644,933  

Toro Co. (The)

    80,771       6,529,528  

Watts Water Technologies, Inc., Class A

    12,736       2,203,455  

Xylem, Inc.

    188,919       17,671,483  
   

 

 

 
      518,886,601  

Marine Transportation — 0.0%

 

Matson, Inc.

    31,422       2,735,285  
   

 

 

 

Media — 1.5%

 

Cable One, Inc.

    5,331       2,931,357  

Comcast Corp., Class A

    6,255,496       258,289,430  

Interpublic Group of Cos., Inc. (The)

    864,267       24,545,183  

John Wiley & Sons, Inc., Class A

    100,046       3,028,392  

Nexstar Media Group, Inc., Class A

    80,485       11,274,339  

Omnicom Group, Inc.

    407,650       30,537,062  

Sirius XM Holdings, Inc.(c)

    913,483       3,909,707  
   

 

 

 
      334,515,470  

Metals & Mining — 0.4%

 

Nucor Corp.

    177,882       26,289,181  

Reliance Steel & Aluminum Co.

    51,056       12,987,625  
Security   Shares     Value  

Metals & Mining (continued)

 

Royal Gold, Inc.

    53,100     $ 5,539,923  

Southern Copper Corp.

    249,978       17,723,440  

Steel Dynamics, Inc.

    153,530       16,352,480  

Worthington Industries, Inc.

    29,446       1,814,463  
   

 

 

 
      80,707,112  

Multi-Utilities — 1.9%

 

Ameren Corp.

    495,232       37,494,015  

Black Hills Corp.

    182,179       8,808,355  

CMS Energy Corp.

    601,988       32,712,028  

Consolidated Edison, Inc.

    754,364       66,225,616  

DTE Energy Co.

    452,522       43,614,070  

NiSource, Inc.

    918,490       23,109,208  

Public Service Enterprise Group, Inc.

    1,119,683       69,028,457  

Sempra

    1,253,821       87,805,085  

WEC Energy Group, Inc.

    699,606       56,940,932  
   

 

 

 
      425,737,766  

Oil, Gas & Consumable Fuels — 6.8%

 

Chevron Corp.

    3,758,558       547,734,657  

ConocoPhillips

    1,168,459       138,812,929  

EOG Resources, Inc.

    844,494       106,617,368  

Exxon Mobil Corp.

    6,076,214       643,167,252  

Phillips 66

    962,534       109,796,254  

Texas Pacific Land Corp.

    2,495       4,605,645  
   

 

 

 
      1,550,734,105  

Paper & Forest Products — 0.0%

 

Louisiana-Pacific Corp.

    63,427       3,252,537  
   

 

 

 

Personal Care Products — 0.1%

 

Estee Lauder Cos., Inc. (The), Class A

    227,264       29,287,512  

Inter Parfums, Inc.

    20,615       2,620,372  
   

 

 

 
      31,907,884  

Pharmaceuticals — 8.8%

 

Bristol-Myers Squibb Co.

    4,676,163       240,962,679  

Eli Lilly & Co.

    370,444       205,200,045  

Johnson & Johnson

    4,225,617       626,828,026  

Merck & Co., Inc.

    4,053,067       416,249,981  

Perrigo Co. PLC

    257,862       7,127,306  

Pfizer, Inc.

    15,691,372       479,528,328  

Zoetis, Inc., Class A

    215,699       33,864,743  
   

 

 

 
          2,009,761,108  

Professional Services — 0.8%

 

Automatic Data Processing, Inc.

    479,361       104,606,158  

Booz Allen Hamilton Holding Corp., Class A

    127,074       15,239,985  

Broadridge Financial Solutions, Inc.

    107,935       18,418,028  

Exponent, Inc.

    34,582       2,534,515  

Genpact Ltd.

    148,297       4,973,881  

Insperity, Inc.

    48,061       5,086,776  

ManpowerGroup, Inc.

    113,995       7,976,230  

Robert Half, Inc.

    167,153       12,498,030  

SS&C Technologies Holdings, Inc.

    217,719       10,940,380  
   

 

 

 
      182,273,983  

Semiconductors & Semiconductor Equipment — 5.3%

 

Analog Devices, Inc.

    556,492       87,552,886  

Applied Materials, Inc.

    410,442       54,321,999  

Broadcom, Inc.

    512,272       431,010,293  

KLA Corp.

    80,883       37,990,745  

Lam Research Corp.

    77,353       45,500,582  

Microchip Technology, Inc.

    644,268       45,929,866  

Monolithic Power Systems, Inc.

    19,996       8,833,033  

NXP Semiconductors NV

    296,543       51,132,909  

 

 

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

  19


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Semiconductors & Semiconductor Equipment (continued)

 

Power Integrations, Inc.

    29,686     $ 2,058,130  

QUALCOMM, Inc.

    1,810,814       197,360,618  

Skyworks Solutions, Inc.

    238,477       20,685,495  

Texas Instruments, Inc.

    1,560,531       221,611,007  

Universal Display Corp.

    23,850       3,319,443  
   

 

 

 
          1,207,307,006  

Software — 4.0%

 

Dolby Laboratories, Inc., Class A

    46,010       3,724,050  

Intuit, Inc.

    92,415       45,740,804  

Microsoft Corp.

    2,171,517       734,211,613  

Oracle Corp.

    1,153,617       119,283,998  

Roper Technologies, Inc.

    34,476       16,843,939  
   

 

 

 
      919,804,404  

Specialty Retail — 3.0%

 

Best Buy Co., Inc.

    564,682       37,732,051  

Dick’s Sporting Goods, Inc.

    128,802       13,775,374  

Group 1 Automotive, Inc.

    6,667       1,682,284  

Home Depot, Inc. (The)

    1,512,754       430,665,936  

Lithia Motors, Inc., Class A

    10,512       2,546,111  

Lowe’s Cos., Inc.

    665,611       126,845,488  

Penske Automotive Group, Inc.

    25,296       3,619,352  

Ross Stores, Inc.

    223,640       25,935,531  

Tractor Supply Co.

    121,712       23,436,863  

Valvoline, Inc.

    129,810       3,851,463  

Williams-Sonoma, Inc.

    98,142       14,744,854  
   

 

 

 
      684,835,307  

Technology Hardware, Storage & Peripherals — 3.3%

 

Apple Inc.

    3,789,942       647,208,395  

Hewlett Packard Enterprise Co.

    2,037,107       31,330,706  

HP, Inc.

    1,763,968       46,445,278  

NetApp, Inc.

    313,149       22,790,984  
   

 

 

 
      747,775,363  

Textiles, Apparel & Luxury Goods — 0.5%

 

Carter’s, Inc.

    101,142       6,792,697  

Columbia Sportswear Co.

    31,573       2,330,087  

NIKE, Inc., Class B

    974,442       100,143,404  

Steven Madden Ltd.

    110,883       3,635,854  
   

 

 

 
      112,902,042  

Trading Companies & Distributors — 0.5%

 

Air Lease Corp., Class A

    118,019       4,086,998  
Security   Shares     Value  

Trading Companies & Distributors (continued)

 

Applied Industrial Technologies, Inc.

    19,950     $ 3,062,525  

Boise Cascade Co.

    17,498       1,640,438  

Fastenal Co.

    831,985       48,538,005  

GATX Corp.

    39,653       4,146,911  

McGrath RentCorp

    27,389       2,755,333  

MSC Industrial Direct Co., Inc., Class A

    93,031       8,814,687  

Rush Enterprises, Inc., Class A

    54,583       1,942,063  

Rush Enterprises, Inc., Class B

    9,937       401,852  

Watsco, Inc.

    54,690       19,080,794  

WW Grainger, Inc.

    28,005       20,438,889  
   

 

 

 
      114,908,495  

Water Utilities — 0.2%

 

American States Water Co.

    45,552       3,555,333  

American Water Works Co., Inc.

    235,897       27,753,282  

California Water Service Group

    70,160       3,415,389  

Essential Utilities, Inc.

    486,268       16,270,527  

SJW Group

    39,093       2,442,531  
   

 

 

 
      53,437,062  
   

 

 

 

Total Long-Term Investments — 99.7%
(Cost: $21,227,187,679)

 

    22,718,392,272  
   

 

 

 
Short-Term Securities  
Money Market Funds — 0.2%            

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

    3,963,080       3,964,665  

BlackRock Cash Funds: Treasury,
SL Agency Shares, 5.33%(a)(d)

    46,583,009       46,583,009  
   

 

 

 

Total Short-Term Securities — 0.2%
(Cost: $50,547,599)

 

    50,547,674  
   

 

 

 

Total Investments — 99.9%
(Cost: $21,277,735,278)

 

    22,768,939,946  

Other Assets Less Liabilities — 0.1%

 

    27,688,679  
   

 

 

 

Net Assets — 100.0%

 

  $   22,796,628,625  
   

 

 

 

 

(a) 

Affiliate of the Fund.

(b) 

Non-income producing security.

(c) 

All or a portion of this security is on loan.

(d) 

Annualized 7-day yield as of period end.

(e) 

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

 

 

20  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    
Value at
04/30/23
 
 
   
Purchases
at Cost
 
 
   
Proceeds
from Sale
 
 
   

Net
Realized
Gain (Loss)
 
 
 
   


Change in
Unrealized
Appreciation
(Depreciation)
 
 
 
 
   
Value at
10/31/23
 
 
   

Shares
Held at
10/31/23
 
 
 
    Income      




Capital

Gain
Distributions
from Underlying
Funds

 


 
 
 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 644,774     $ 3,319,464 (a)    $     $ 352     $ 75     $ 3,964,665       3,963,080     $ 221,846 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    46,636,422             (53,413 )(a)                  46,583,009       46,583,009       1,446,116        

BlackRock, Inc.

    162,805,601       15,312,289       (9,508,264     1,237,703       (15,896,258     153,951,071       251,439       2,464,715        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $   1,238,055     $ (15,896,183   $   204,498,745       $   4,132,677     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 

 

  (b) 

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

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

 

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

 

 
Long Contracts                                

S&P 500 E-Mini Index

     346          12/15/23        $72,872      $ (3,047,144
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

 

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

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 3,047,144      $      $      $      $ 3,047,144  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

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

 

For the period ended October 31, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

 

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

 

 

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $ 6,044,926      $      $      $      $ 6,044,926  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $        $  (7,658,504    $      $      $        $  (7,658,504
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

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

  21


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core Dividend Growth ETF

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

 

 
Futures contracts       

Average notional value of contracts — long

   $ 83,157,775  

 

 

Fair Value Hierarchy as of Period End

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

The following table summarizes the Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

   $ 22,718,392,272        $        $        $ 22,718,392,272  

Short-Term Securities

                 

Money Market Funds

     50,547,674                            50,547,674  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $     22,768,939,946        $                         —        $                         —        $     22,768,939,946  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $ (3,047,144      $        $        $ (3,047,144
  

 

 

      

 

 

      

 

 

      

 

 

 

 

(a) 

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

 

See notes to financial statements.

 

 

22  

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


Schedule of Investments (unaudited)

October 31, 2023

  

iShares® Core High Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Air Freight & Logistics — 2.4%

   

United Parcel Service, Inc., Class B

    1,671,521     $ 236,102,341  
   

 

 

 

Banks — 3.0%

 

Wells Fargo & Co.

    7,397,706       294,206,768  
   

 

 

 

Beverages — 8.0%

 

Coca-Cola Co. (The)

    7,038,019       397,577,693  

PepsiCo, Inc.

    2,304,684       376,308,804  
   

 

 

 
      773,886,497  

Biotechnology — 8.4%

 

AbbVie, Inc.

    4,143,586       584,991,471  

Gilead Sciences, Inc.

    2,911,713       228,685,939  
   

 

 

 
      813,677,410  

Capital Markets — 4.3%

 

Ares Management Corp., Class A

    281,823       27,784,930  

Artisan Partners Asset Management, Inc., Class A

    229,999       7,589,967  

BlackRock, Inc.(a)

    249,251       152,611,402  

Blackstone, Inc., Class A, NVS

    1,194,534       110,315,215  

Carlyle Group, Inc. (The)

    548,489       15,105,387  

Cohen & Steers, Inc.

    51,955       2,714,129  

Franklin Resources, Inc.

    764,357       17,419,696  

Invesco Ltd.

    1,369,207       17,758,615  

Janus Henderson Group PLC

    442,446       10,207,229  

Moelis & Co., Class A

    203,532       8,475,073  

T Rowe Price Group, Inc.

    568,740       51,470,970  
   

 

 

 
      421,452,613  

Chemicals — 1.7%

 

Dow, Inc.

    2,084,269       100,753,564  

LyondellBasell Industries NV, Class A

    735,234       66,347,516  
   

 

 

 
      167,101,080  

Communications Equipment — 3.5%

 

Cisco Systems, Inc.

    6,457,278       336,617,902  
   

 

 

 

Consumer Staples Distribution & Retail — 0.6%

 

Sysco Corp.

    855,201       56,862,314  
   

 

 

 

Containers & Packaging — 0.4%

 

Amcor PLC

    4,493,471       39,946,957  
   

 

 

 

Diversified Telecommunication Services — 6.7%

 

Verizon Communications, Inc.

    18,544,116       651,454,795  
   

 

 

 

Electric Utilities — 7.4%

 

ALLETE, Inc.

    166,777       8,929,241  

Alliant Energy Corp.

    529,888       25,853,236  

Duke Energy Corp.

    2,086,218       185,443,918  

IDACORP, Inc.

    98,612       9,339,543  

NextEra Energy, Inc.

    3,327,398       193,987,303  

PNM Resources, Inc.

    165,225       6,982,409  

PPL Corp.

    1,676,746       41,197,649  

Southern Co. (The)

    2,662,165       179,163,704  

Xcel Energy, Inc.

    1,173,724       69,566,621  
   

 

 

 
          720,463,624  

Financial Services — 0.2%

 

Radian Group, Inc.

    310,007       7,855,577  

Western Union Co. (The)

    1,453,864       16,414,125  
   

 

 

 
      24,269,702  

Food Products — 1.3%

 

General Mills, Inc.

    1,215,626       79,307,440  
Security   Shares     Value  

Food Products (continued)

 

Hormel Foods Corp.

    495,297     $ 16,121,917  

Kellanova

    601,869       30,376,329  
   

 

 

 
      125,805,686  

Gas Utilities — 0.1%

 

New Jersey Resources Corp.

    214,260       8,694,671  
   

 

 

 

Health Care Equipment & Supplies — 1.9%

 

Medtronic PLC

    2,628,135       185,441,206  
   

 

 

 

Hotels, Restaurants & Leisure — 0.4%

 

Darden Restaurants, Inc.

    246,204       35,830,068  
   

 

 

 

Household Durables — 0.3%

 

Garmin Ltd.

    249,046       25,534,686  
   

 

 

 

Household Products — 1.2%

 

Clorox Co. (The)

    223,920       26,355,384  

Kimberly-Clark Corp.

    726,673       86,939,158  

Reynolds Consumer Products, Inc.

    113,093       2,875,955  
   

 

 

 
      116,170,497  

Insurance — 0.6%

 

Cincinnati Financial Corp.

    261,636       26,077,260  

Old Republic International Corp.

    574,600       15,732,548  

Unum Group

    322,723       15,781,155  
   

 

 

 
      57,590,963  

IT Services — 3.5%

 

International Business Machines Corp.

    2,352,414       340,253,161  
   

 

 

 

Media — 2.6%

 

Comcast Corp., Class A

    6,203,352       256,136,404  
   

 

 

 

Metals & Mining — 0.2%

 

Southern Copper Corp.

    247,836       17,571,572  
   

 

 

 

Multi-Utilities — 2.7%

 

DTE Energy Co.

    449,945       43,365,699  

Northwestern Energy Group, Inc.

    178,974       8,592,542  

Public Service Enterprise Group, Inc.

    1,109,343       68,390,996  

Sempra

    1,242,912       87,041,127  

WEC Energy Group, Inc.

    692,718       56,380,318  
   

 

 

 
      263,770,682  

Oil, Gas & Consumable Fuels — 22.3%

 

Antero Midstream Corp.

    1,499,311       18,501,498  

Chevron Corp.

    3,727,163       543,159,464  

Chord Energy Corp.

    80,157       13,251,555  

Coterra Energy, Inc.

    1,249,262       34,354,705  

DT Midstream, Inc.

    308,414       16,645,104  

EOG Resources, Inc.

    837,525       105,737,531  

Exxon Mobil Corp.

    7,423,994       785,829,765  

Kinder Morgan, Inc.

    7,741,554       125,413,175  

ONEOK, Inc.

    1,551,239       101,140,783  

Phillips 66

    954,465       108,875,822  

Pioneer Natural Resources Co.

    747,351       178,616,889  

Williams Cos., Inc. (The)

    3,722,310       128,047,464  
   

 

 

 
          2,159,573,755  

Pharmaceuticals — 8.9%

 

Bristol-Myers Squibb Co.

    4,637,129       238,951,257  

Johnson & Johnson

    4,190,417       621,606,458  
   

 

 

 
      860,557,715  

Professional Services — 0.6%

 

Paychex, Inc.

    548,702       60,933,357  
   

 

 

 

Semiconductors & Semiconductor Equipment — 2.3%

 

Texas Instruments, Inc.

    1,547,531       219,764,877  
   

 

 

 

 

 

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

  23


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core High Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Tobacco — 3.7%

   

Altria Group, Inc.

    8,906,828     $ 357,787,281  
   

 

 

 

Trading Companies & Distributors — 0.3%

   

MSC Industrial Direct Co., Inc., Class A

    91,556       8,674,931  

Watsco, Inc.

    53,395       18,628,982  
   

 

 

 
      27,303,913  

Water Utilities — 0.2%

   

Essential Utilities, Inc.

    484,796       16,221,274  
   

 

 

 

Total Long-Term Investments — 99.7%
(Cost: $10,275,297,812)

      9,670,983,771  
   

 

 

 

Short-Term Securities

   

Money Market Funds — 0.1%

   

BlackRock Cash Funds: Treasury, SL Agency
Shares, 5.33%(a)(b)

    10,847,919       10,847,919  
   

 

 

 

Total Short-Term Securities — 0.1%
(Cost: $10,847,919)

 

    10,847,919  
   

 

 

 

Total Investments — 99.8%
(Cost: $10,286,145,731)

 

    9,681,831,690  

Other Assets Less Liabilities — 0.2%

 

    15,043,841  
   

 

 

 

Net Assets — 100.0%

 

  $   9,696,875,531  
   

 

 

 

 

(a) 

Affiliate of the Fund.

(b) 

Annualized 7-day yield as of period end.

    

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer   Value at
04/30/23
   

Purchases

at Cost

    Proceeds
from Sale
    Net
Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
10/31/23
    Shares
Held at
10/31/23
    Income    

Capital

Gain
Distributions
from Underlying
Funds

 

BlackRock Cash Funds: Treasury, SL Agency Shares

 

$

  22,682,184

 

 

$

 

 

$

  (11,834,265

)(a) 

 

$

 

 

$

 

 

$

10,847,919

 

 

 

10,847,919

 

 

$

522,602

 

 

$

 

BlackRock, Inc.

          197,547,708       (22,081,673     (339,197     (22,515,436     152,611,402       249,251       1,318,790        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ (339,197   $ (22,515,436   $   163,459,321       $   1,841,392     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

 

 
Description    Number of
Contracts
     Expiration
Date
    

Notional
Amount

(000)

    

Value/
Unrealized
Appreciation

(Depreciation)

 

 

 

Long Contracts

           

E-Mini Consumer Staples Index

     147        12/15/23      $ 10,090      $ 219,294  

E-Mini Dow Jones Industrial Average Index

     44        12/15/23        7,290        (44,111

E-Mini Energy Select Sector Index

     67        12/15/23        6,004        (64,801
           

 

 

 
            $ 110,382  
           

 

 

 

 

 

24  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Core High Dividend ETF

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

 

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

 

 

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized appreciation on futures contracts

   $      $      $   219,294      $      $      $      $ 219,294  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 108,912      $      $      $      $   108,912  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

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

 

For the period ended October 31, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

 

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

 

 

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $ (854,568    $      $      $      $ (854,568
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $ (1,675,345    $      $      $      $   (1,675,345
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts

        

Average notional value of contracts — long

   $ 28,591,108  

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

Fair Value Hierarchy as of Period End

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

The following table summarizes the Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1      Level 2      Level 3      Total  

 

 

Assets

           

Investments

           

Long-Term Investments

           

Common Stocks

   $ 9,670,983,771      $                     —      $                     —      $ 9,670,983,771  

Short-Term Securities

           

Money Market Funds

     10,847,919                      10,847,919  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $     9,681,831,690      $      $      $     9,681,831,690  
  

 

 

    

 

 

    

 

 

    

 

 

 

Derivative Financial Instruments(a)

           

Assets

           

Equity Contracts

   $ 219,294      $      $      $ 219,294  

Liabilities

           

Equity Contracts

     (108,912                    (108,912
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 110,382      $      $      $ 110,382  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

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

 

See notes to financial statements.

 

 

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

  25


Schedule of Investments (unaudited)

October 31, 2023

  

iShares® Select Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares      Value  

Common Stocks

    

Aerospace & Defense — 0.9%

    

Lockheed Martin Corp.

    321,370      $ 146,107,657  
    

 

 

 

Automobiles — 1.3%

    

Ford Motor Co.

    23,308,805        227,260,849  
    

 

 

 

Banks — 10.1%

    

Citizens Financial Group, Inc.

    6,422,962        150,490,000  

Comerica, Inc.

    3,150,301        124,121,859  

Fifth Third Bancorp

    6,562,184        155,589,383  

First Horizon Corp.

    6,976,837        75,000,998  

FNB Corp.

    8,407,965        89,881,146  

Huntington Bancshares, Inc.

    17,039,154        164,427,836  

KeyCorp

    15,763,547        161,103,450  

New York Community Bancorp, Inc., Class A

    16,499,091        156,411,383  

Regions Financial Corp.

    9,595,191        139,418,125  

Truist Financial Corp.

    6,153,651        174,517,542  

U.S. Bancorp

    5,376,192        171,393,001  

United Bankshares, Inc.

    3,225,975        91,746,729  

Valley National Bancorp

    10,260,067        79,823,321  
    

 

 

 
           1,733,924,773  

Beverages — 1.0%

    

Coca-Cola Co. (The)

    3,134,282        177,055,590  
    

 

 

 

Biotechnology — 1.3%

    

Gilead Sciences, Inc.

    2,824,045        221,800,494  
    

 

 

 

Broadline Retail — 0.4%

    

Kohl’s Corp.

    2,796,695        63,065,472  
    

 

 

 

Capital Markets — 4.1%

    

Federated Hermes, Inc., Class B

    1,927,397        61,098,485  

Franklin Resources, Inc.

    6,684,267        152,334,445  

Invesco Ltd.

    10,600,076        137,482,986  

Janus Henderson Group PLC

    3,124,087        72,072,687  

Lazard Ltd., Class A

    2,569,610        71,358,070  

T Rowe Price Group, Inc.

    2,348,211        212,513,095  
    

 

 

 
       706,859,768  

Chemicals — 2.8%

    

Chemours Co. (The)

    3,444,962        83,058,034  

Huntsman Corp.

    4,255,845        99,288,864  

LyondellBasell Industries NV, Class A

    3,213,437        289,980,555  
    

 

 

 
       472,327,453  

Consumer Staples Distribution & Retail — 1.2%

 

  

Walgreens Boots Alliance, Inc.

    9,528,448        200,859,684  
    

 

 

 

Containers & Packaging — 4.9%

    

International Paper Co.

    8,044,378        271,336,870  

Packaging Corp. of America

    1,612,090        246,730,375  

Sonoco Products Co.

    2,283,293        118,297,410  

Westrock Co.

    5,804,028        208,538,726  
    

 

 

 
       844,903,381  

Distributors — 0.6%

    

Genuine Parts Co.

    773,332        99,651,562  
    

 

 

 

Diversified Consumer Services — 0.8%

    

H&R Block, Inc.

    3,519,228        144,464,309  
    

 

 

 

Diversified Telecommunication Services — 4.0%

 

  

AT&T Inc.

    19,197,106        295,635,432  

Verizon Communications, Inc.

    10,906,089        383,130,907  
    

 

 

 
       678,766,339  

Electric Utilities — 15.4%

    

Alliant Energy Corp.

    4,166,476        203,282,364  
Security   Shares     Value  

Electric Utilities (continued)

   

American Electric Power Co., Inc.

    2,572,189     $ 194,303,157  

Edison International

    3,966,632       250,135,814  

Entergy Corp.

    2,437,829       233,032,074  

Eversource Energy

    2,910,558       156,558,915  

Exelon Corp.

    5,260,360       204,838,418  

FirstEnergy Corp.

    6,046,983       215,272,595  

IDACORP, Inc.

    1,171,396       110,942,915  

NextEra Energy, Inc.

    2,158,014       125,812,216  

NRG Energy, Inc.

    5,095,145       215,932,245  

OGE Energy Corp.

    4,588,231       156,917,500  

Pinnacle West Capital Corp.

    2,475,619       183,641,417  

PPL Corp.

    7,994,110       196,415,283  

Xcel Energy, Inc.

    3,044,372       180,439,929  
   

 

 

 
          2,627,524,842  

Electrical Equipment — 0.9%

   

Emerson Electric Co.

    1,785,715       158,875,064  
   

 

 

 

Financial Services — 0.6%

   

Western Union Co. (The)

    9,171,039       103,541,030  
   

 

 

 

Food Products — 1.8%

   

Conagra Brands, Inc.

    6,146,244       168,161,236  

General Mills, Inc.

    2,089,964       136,349,251  
   

 

 

 
      304,510,487  

Gas Utilities — 1.6%

   

New Jersey Resources Corp.

    2,177,118       88,347,448  

Southwest Gas Holdings, Inc.

    1,438,591       84,315,819  

UGI Corp.

    4,898,203       101,882,622  
   

 

 

 
      274,545,889  

Hotels, Restaurants & Leisure — 1.3%

   

McDonald’s Corp.

    528,657       138,598,006  

Wendy’s Co. (The)

    4,024,111       76,538,591  
   

 

 

 
      215,136,597  

Household Durables — 2.7%

   

Garmin Ltd.

    1,842,053       188,865,694  

Leggett & Platt, Inc.

    3,179,540       74,496,622  

Newell Brands, Inc.

    9,499,831       63,838,864  

Whirlpool Corp.

    1,259,017       131,642,818  
   

 

 

 
      458,843,998  

Household Products — 1.3%

   

Kimberly-Clark Corp.

    1,855,619       222,006,257  
   

 

 

 

Insurance — 8.0%

   

Cincinnati Financial Corp.

    1,294,005       128,973,478  

Fidelity National Financial, Inc., Class A

    6,734,884       263,266,616  

MetLife, Inc.

    2,511,363       150,706,894  

Old Republic International Corp.

    6,761,797       185,138,002  

Principal Financial Group, Inc.

    2,091,293       141,538,710  

Prudential Financial, Inc.

    3,208,946       293,426,022  

Unum Group

    4,094,076       200,200,316  
   

 

 

 
      1,363,250,038  

IT Services — 2.1%

   

International Business Machines Corp.

    2,426,144       350,917,468  
   

 

 

 

Media — 1.9%

   

Interpublic Group of Cos., Inc. (The)

    6,075,862       172,554,481  

Omnicom Group, Inc.

    2,087,021       156,338,743  
   

 

 

 
      328,893,224  

Metals & Mining — 1.2%

   

Newmont Corp.

    5,296,440       198,457,607  
   

 

 

 

 

 

26  

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


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Select Dividend ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Multi-Utilities — 10.3%

   

Avista Corp.

    1,709,226     $ 54,165,372  

Black Hills Corp.

    1,505,659       72,798,612  

CenterPoint Energy, Inc.

    5,935,967       159,558,793  

CMS Energy Corp.

    3,364,172       182,809,106  

Dominion Energy, Inc.

    5,315,993       214,340,838  

DTE Energy Co.

    1,969,285       189,799,688  

NiSource, Inc.

    8,001,586       201,319,904  

Northwestern Energy Group, Inc.

    1,350,019       64,814,412  

Public Service Enterprise Group, Inc.

    3,890,097       239,824,480  

Sempra

    2,596,990       181,867,210  

WEC Energy Group, Inc.

    2,397,194       195,107,620  
   

 

 

 
          1,756,406,035  

Oil, Gas & Consumable Fuels — 6.4%

   

Chevron Corp.

    1,401,378       204,222,816  

Exxon Mobil Corp.

    1,832,743       193,995,847  

Marathon Petroleum Corp.

    1,155,274       174,735,192  

ONEOK, Inc.

    5,294,763       345,218,548  

Valero Energy Corp.

    1,419,881       180,324,887  
   

 

 

 
      1,098,497,290  

Pharmaceuticals — 2.0%

   

Merck & Co., Inc.

    1,544,890       158,660,203  

Pfizer, Inc.

    6,132,377       187,405,441  
   

 

 

 
      346,065,644  

Technology Hardware, Storage & Peripherals — 2.8%

 

 

HP, Inc.

    7,657,695       201,627,110  

Seagate Technology Holdings PLC

    4,148,425       283,130,006  
   

 

 

 
      484,757,116  
Security   Shares     Value  

Tobacco — 4.1%

   

Altria Group, Inc.

    10,531,591     $ 423,054,010  

Philip Morris International, Inc.

    3,185,580       284,026,313  
   

 

 

 
      707,080,323  

Trading Companies & Distributors — 1.9%

   

MSC Industrial Direct Co., Inc., Class A

    1,066,039       101,007,195  

Watsco, Inc.

    638,168       222,650,434  
   

 

 

 
      323,657,629  
   

 

 

 

Total Long-Term Investments — 99.7%
(Cost: $18,715,110,990)

          17,040,013,869  
   

 

 

 

Short-Term Securities

   

Money Market Funds — 0.1%

   

BlackRock Cash Funds: Treasury, SL Agency Shares, 5.33%(a)(b)

    14,962,651       14,962,651  
   

 

 

 

Total Short-Term Securities — 0.1%
(Cost: $14,962,651)

 

    14,962,651  
   

 

 

 

Total Investments — 99.8%
(Cost: $18,730,073,641)

 

    17,054,976,520  

Other Assets Less Liabilities — 0.2%

 

    34,658,960  
   

 

 

 

Net Assets — 100.0%

 

  $ 17,089,635,480  
   

 

 

 

 

(a) 

Affiliate of the Fund.

(b) 

Annualized 7-day yield as of period end.

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the six months ended October 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

 

 
Affiliated Issuer   Value at
04/30/23
    Purchases
at Cost
    Proceeds
from Sale
    Net
Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
10/31/23
    Shares
Held at
10/31/23
    Income    

Capital

Gain
Distributions
from Underlying
Funds

 

 

 

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

  $     $     $ (48 )(b)    $ 48     $     $           $ 803 (c)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    30,848,274             (15,885,623 )(b)                  14,962,651       14,962,651       985,804        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
        $ 48     $     $   14,962,651       $   986,607     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

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

 
  (b) 

Represents net amount purchased (sold).

 
  (c) 

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

 

 

 

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

  27


Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Select Dividend ETF

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

 

 
Description    Number of
Contracts
     Expiration
Date
     Notional
Amount
(000)
    

Value/
Unrealized
Appreciation

(Depreciation)

 

 

 

Long Contracts

           

E-Mini Energy Select Sector Index

     74        12/15/23      $ 6,632      $ (96,819

E-Mini Financials Select Sector Index

     249        12/15/23        24,922        (485,718

E-Mini Utilities Select Sector Index

     278        12/15/23        16,791        171,268  
           

 

 

 
            $ (411,269
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

 

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

 

 

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized appreciation on futures contracts(a)

   $      $      $ 171,268      $      $      $      $ 171,268  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $ 582,537      $      $      $      $ 582,537  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

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

 

For the period ended October 31, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

 

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

 

 

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $ (3,119,889    $      $      $      $ (3,119,889
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $ (2,540,824    $      $      $      $ (2,540,824
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

 

 

Futures contracts

  

Average notional value of contracts — long

   $ 49,672,221  

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

 

 

28  

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Schedule of Investments (unaudited) (continued)

October 31, 2023

  

iShares® Select Dividend ETF

 

Fair Value Hierarchy as of Period End

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

The following table summarizes the Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

 

 
     Level 1      Level 2      Level 3      Total  

 

 

Assets

           

Investments

           

Long-Term Investments

           

Common Stocks

   $ 17,040,013,869      $      $      $ 17,040,013,869  

Short-Term Securities

           

Money Market Funds

     14,962,651                      14,962,651  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $     17,054,976,520      $      $      $     17,054,976,520  
  

 

 

    

 

 

    

 

 

    

 

 

 

Derivative Financial Instruments(a)

           

Assets

           

Equity Contracts

   $ 171,268      $      $      $ 171,268  

Liabilities

           

Equity Contracts

     (582,537                    (582,537
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ (411,269    $                         —      $                         —      $ (411,269
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

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

 

See notes to financial statements.

 

 

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

  29


 

Statements of Assets and Liabilities (unaudited)

October 31, 2023

 

   

iShares

Core Dividend
ETF

   

iShares

Core Dividend
Growth ETF

    

iShares

Core High
Dividend ETF

   

iShares

Select Dividend ETF

 

 

 

ASSETS

        

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

  $ 234,627,603     $ 22,564,441,201      $ 9,518,372,369     $ 17,040,013,869  

Investments, at value — affiliated(c)

    1,904,566       204,498,745        163,459,321       14,962,651  

Cash

    2       1,534        147       1,127  

Cash pledged:

        

Futures contracts

    41,000       3,914,000        1,255,000       2,056,000  

Receivables:

        

Investments sold

          220,256        395,861       2,497,185  

Securities lending income — affiliated

          86,381        22,951       225  

Capital shares sold

          1,871,302               

Dividends — unaffiliated

    436,957       26,613,380        30,241,741       35,781,652  

Dividends — affiliated

    3,777       244,931        84,408       142,018  

Variation margin on futures contracts

    5,003       458,450        76,780       384,577  
 

 

 

   

 

 

    

 

 

   

 

 

 

Total assets

    237,018,908       22,802,350,180        9,713,908,578       17,095,839,304  
 

 

 

   

 

 

    

 

 

   

 

 

 

LIABILITIES

        

Collateral on securities loaned

          3,964,612               

Payables:

        

Investments purchased

    507,566       220,256        16,322,381        

Capital shares redeemed

                 39,308       505,517  

Investment advisory fees

    9,938       1,536,687        671,358       5,698,307  
 

 

 

   

 

 

    

 

 

   

 

 

 

Total liabilities

    517,504       5,721,555        17,033,047       6,203,824  
 

 

 

   

 

 

    

 

 

   

 

 

 

Commitments and contingent liabilities

        

NET ASSETS

  $ 236,501,404     $ 22,796,628,625      $ 9,696,875,531     $ 17,089,635,480  
 

 

 

   

 

 

    

 

 

   

 

 

 

NET ASSETS CONSIST OF:

        

Paid-in capital

  $ 278,793,693     $ 22,145,928,378      $ 11,756,850,001     $ 19,718,952,610  

Accumulated earnings (loss)

    (42,292,289     650,700,247        (2,059,974,470     (2,629,317,130
 

 

 

   

 

 

    

 

 

   

 

 

 

NET ASSETS

  $ 236,501,404     $ 22,796,628,625      $ 9,696,875,531     $ 17,089,635,480  
 

 

 

   

 

 

    

 

 

   

 

 

 

NET ASSET VALUE

        

Shares outstanding

  $ 6,550,000     $ 472,700,000      $ 101,550,000     $ 163,250,000  
 

 

 

   

 

 

    

 

 

   

 

 

 

Net asset value

  $ 36.11     $ 48.23      $ 95.49     $ 104.68  
 

 

 

   

 

 

    

 

 

   

 

 

 

Shares authorized

    Unlimited       Unlimited        Unlimited       Unlimited  
 

 

 

   

 

 

    

 

 

   

 

 

 

Par value

    None       None        None       None  
 

 

 

   

 

 

    

 

 

   

 

 

 

(a) Investments, at cost — unaffiliated

  $ 252,666,874     $ 21,073,570,735      $ 10,100,170,974     $ 18,715,110,990  

(b) Securities loaned, at value

  $     $ 3,770,787      $     $  

(c) Investments, at cost — affiliated

  $ 2,114,161     $ 204,164,543      $ 185,974,757     $ 14,962,651  

See notes to financial statements.

 

 

30  

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


 

Statements of Operations (unaudited)

Six Months Ended October 31, 2023

 

   

iShares

Core Dividend
ETF

   

iShares

Core Dividend
Growth ETF

   

iShares

Core High
Dividend ETF

   

iShares

Select Dividend ETF

 

 

 

INVESTMENT INCOME

       

Dividends — unaffiliated

  $ 4,278,876     $ 305,286,669     $ 206,996,601     $ 436,527,397  

Dividends — affiliated

    38,345       3,910,831       1,841,392       985,804  

Interest — unaffiliated

          14,955       4,708        

Securities lending income — affiliated — net

          221,846             803  

Foreign taxes withheld

    (4,562     (107,484            
 

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

    4,312,659       309,326,817       208,842,701       437,514,004  
 

 

 

   

 

 

   

 

 

   

 

 

 

EXPENSES

       

Investment advisory

    63,526       9,437,676       4,196,470       37,213,594  

Interest expense

          61       249       1,358  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

    63,526       9,437,737       4,196,719       37,214,952  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    4,249,133       299,889,080       204,645,982       400,299,052  
 

 

 

   

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

       

Net realized gain (loss) from:

       

Investments — unaffiliated

    2,890,638       177,089,245       (36,450,778     (103,604,502

Investments — affiliated

    (41,009     (315,964     (267,637     48  

Futures contracts

    3,505       6,044,926       (854,568     (3,119,889

In-kind redemptions — unaffiliated(a)

    (9,589     182,575,429       108,614,167       447,144,030  

In-kind redemptions — affiliated(a)

    6,084       1,554,019       (71,560      
 

 

 

   

 

 

   

 

 

   

 

 

 
    2,849,629       366,947,655       70,969,624       340,419,687  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

       

Investments — unaffiliated

    (11,051,746     (1,574,133,397     (812,425,304     (2,567,032,472

Investments — affiliated

    (52,561     (15,896,183     (22,515,436      

Futures contracts

    (42,854     (7,658,504     (1,675,345     (2,540,824
 

 

 

   

 

 

   

 

 

   

 

 

 
    (11,147,161     (1,597,688,084     (836,616,085     (2,569,573,296
 

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized loss

    (8,297,532     (1,230,740,429     (765,646,461     (2,229,153,609
 

 

 

   

 

 

   

 

 

   

 

 

 

NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS

  $ (4,048,399   $ (930,851,349   $ (561,000,479   $ (1,828,854,557
 

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) 

See Note 2 of the Notes to Financial Statements.

See notes to financial statements.

 

 

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

  31


 

Statements of Changes in Net Assets

 

    iShares Core Dividend ETF            iShares Core Dividend Growth ETF  
 

 

 

      

 

 

 
    Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
          

Six Months Ended

10/31/23

(unaudited)

    Year Ended
04/30/23
 

 

 

INCREASE (DECREASE) IN NET ASSETS

          

OPERATIONS

          

Net investment income

  $ 4,249,133     $ 6,460,263        $ 299,889,080     $ 575,258,915  

Net realized gain (loss)

    2,849,629       (12,617,681        366,947,655       248,197,630  

Net change in unrealized appreciation (depreciation)

    (11,147,161     (962,486        (1,597,688,084     (65,720,886
 

 

 

   

 

 

      

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

    (4,048,399     (7,119,904        (930,851,349     757,735,659  
 

 

 

   

 

 

      

 

 

   

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS(a)

          

Decrease in net assets resulting from distributions to shareholders

    (4,275,715     (6,069,221        (298,719,311     (566,321,278
 

 

 

   

 

 

      

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

          

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

    (15,873,963     13,625,180          514,996,250       576,990,646  
 

 

 

   

 

 

      

 

 

   

 

 

 

NET ASSETS

          

Total increase (decrease) in net assets

    (24,198,077     436,055          (714,574,410     768,405,027  

Beginning of period

    260,699,481       260,263,426          23,511,203,035       22,742,798,008  
 

 

 

   

 

 

      

 

 

   

 

 

 

End of period

  $ 236,501,404     $ 260,699,481        $ 22,796,628,625     $ 23,511,203,035  
 

 

 

   

 

 

      

 

 

   

 

 

 

 

(a) 

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

See notes to financial statements.

 

 

32  

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


 

Statements of Changes in Net Assets  (continued)

 

    iShares Core High Dividend ETF           iShares Select Dividend ETF  
 

 

 

     

 

 

 
    Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
          Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
 

 

 

INCREASE (DECREASE) IN NET ASSETS

         

OPERATIONS

         

Net investment income

  $ 204,645,982     $ 467,160,044       $ 400,299,052     $ 779,187,674  

Net realized gain

    70,969,624       187,210,528         340,419,687       684,182,466  

Net change in unrealized appreciation (depreciation)

    (836,616,085     (426,134,339       (2,569,573,296     (1,827,432,545
 

 

 

   

 

 

     

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

    (561,000,479     228,236,233         (1,828,854,557     (364,062,405
 

 

 

   

 

 

     

 

 

   

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS(a)

         

Decrease in net assets resulting from distributions to shareholders

    (194,001,369     (476,667,345       (391,161,171     (783,757,169
 

 

 

   

 

 

     

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

         

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

    (685,787,406     1,755,194,226         (2,112,736,310     908,270,822  
 

 

 

   

 

 

     

 

 

   

 

 

 

NET ASSETS

         

Total increase (decrease) in net assets

    (1,440,789,254     1,506,763,114         (4,332,752,038     (239,548,752

Beginning of period

    11,137,664,785       9,630,901,671         21,422,387,518       21,661,936,270  
 

 

 

   

 

 

     

 

 

   

 

 

 

End of period

  $ 9,696,875,531     $ 11,137,664,785       $ 17,089,635,480     $ 21,422,387,518  
 

 

 

   

 

 

     

 

 

   

 

 

 

 

(a) 

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

See notes to financial statements.

 

 

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

  33


Financial Highlights  

(For a share outstanding throughout each period)

 

    iShares Core Dividend ETF  
 

 

 

 
   

Six Months Ended
10/31/23

(unaudited

 
 

   
Year Ended
04/30/23
 
 
    
Year Ended
04/30/22
 
 
    
Year Ended
04/30/21
 
 
    
Year Ended
04/30/20
 
 
    
Year Ended
04/30/19
 
 

 

 

Net asset value, beginning of period

  $ 37.51     $ 39.14      $ 38.39      $ 25.94      $ 27.96      $ 25.30  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.64       0.96        0.77        0.70        0.64        0.61  

Net realized and unrealized gain (loss)(b)

    (1.39     (1.68      0.68        12.43        (2.02      2.67  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    (0.75     (0.72      1.45        13.13        (1.38      3.28  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions(c)

               

From net investment income

    (0.65     (0.91      (0.70      (0.68      (0.64      (0.58

From net realized gain

                                      (0.04
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions

    (0.65     (0.91      (0.70      (0.68      (0.64      (0.62
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 36.11     $ 37.51      $ 39.14      $ 38.39      $ 25.94      $ 27.96  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return(d)

               

Based on net asset value

    (2.06 )%(e)      (1.75 )%       3.71      51.33      (4.95 )%       13.21
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets(f)

               

Total expenses

    0.05 %(g)      0.15      0.25      0.25      0.25      0.25
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income

    3.34 %(g)      2.54      1.87      2.20      2.31      2.34
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

               

Net assets, end of period (000)

  $ 236,501     $ 260,699      $ 260,263      $ 67,180      $ 24,645      $ 8,389  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate(h)

    24     65      25      30      33      31
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average shares outstanding.

(b) 

The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

 
(c) 

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

(d) 

Where applicable, assumes the reinvestment of distributions.

(e) 

Not annualized.

(f) 

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

(g) 

Annualized.

(h) 

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

34  

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


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Core Dividend Growth ETF  
 

 

 

 
    Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
     Year Ended
04/30/22
     Year Ended
04/30/21
     Year Ended
04/30/20
     Year Ended
04/30/19
 

 

 

Net asset value, beginning of period

  $ 50.88     $ 50.58      $ 49.87      $ 36.39      $ 38.13      $ 33.86  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.65       1.22        1.10        1.08        0.99        0.91  

Net realized and unrealized gain (loss)(b)

    (2.65     0.28        0.68        13.44        (1.77      4.20  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    (2.00     1.50        1.78        14.52        (0.78      5.11  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions from net investment income(c)

    (0.65     (1.20      (1.07      (1.04      (0.96      (0.84
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 48.23     $ 50.88      $ 50.58      $ 49.87      $ 36.39      $ 38.13  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return(d)

               

Based on net asset value

    (3.99 )%(e)      3.13      3.51      40.52      (2.05 )%       15.30
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets(f)

               

Total expenses

    0.08 %(g)      0.08      0.08      0.08      0.08      0.08
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income

    2.54 %(g)      2.47      2.10      2.53      2.55      2.55
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

               

Net assets, end of period (000)

  $ 22,796,629     $ 23,511,203      $ 22,742,798      $ 18,403,156      $ 9,355,727      $ 7,084,809  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate(h)

    10     30      22      31      24      26
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average shares outstanding.

(b) 

The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

 
(c) 

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

(d) 

Where applicable, assumes the reinvestment of distributions.

(e) 

Not annualized.

(f) 

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

(g) 

Annualized.

(h) 

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

F I N A N C I A L   H I G H L I G H T S

  35


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Core High Dividend ETF  
 

 

 

 
    Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
     Year Ended
04/30/22
     Year Ended
04/30/21
     Year Ended
04/30/20
     Year Ended
04/30/19
 

 

 

Net asset value, beginning of period

  $ 102.75     $ 103.67      $ 95.59      $ 81.85      $ 95.42      $ 84.44  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    1.97       3.95        3.68        3.56        3.24        3.09  

Net realized and unrealized gain (loss)(b)

    (7.36     (0.88      7.80        13.72        (13.51      11.01  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    (5.39     3.07        11.48        17.28        (10.27      14.10  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions from net investment income(c)

    (1.87     (3.99      (3.40      (3.54      (3.30      (3.12
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 95.49     $ 102.75      $ 103.67      $ 95.59      $ 81.85      $ 95.42  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return(d)

               

Based on net asset value

    (5.31 )%(e)      3.16      12.21      21.70      (10.86 )%       17.05
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets(f)

               

Total expenses

    0.08 %(g)      0.08      0.08      0.08      0.08      0.08
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income

    3.90 %(g)      3.86      3.68      4.13      3.53      3.48
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

               

Net assets, end of period (000)

  $ 9,696,876     $ 11,137,665      $ 9,630,902      $ 6,839,327      $ 6,036,798      $ 7,175,741  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate(h)

    35     74      74      75      62      57
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average shares outstanding.

(b) 

The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

 
(c) 

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

(d) 

Where applicable, assumes the reinvestment of distributions.

(e) 

Not annualized.

(f) 

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

(g) 

Annualized.

(h) 

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

36  

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Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    iShares Select Dividend ETF  
 

 

 

 
    Six Months Ended
10/31/23
(unaudited)
    Year Ended
04/30/23
     Year Ended
04/30/22
     Year Ended
04/30/21
     Year Ended
04/30/20
     Year Ended
04/30/19
 

 

 

Net asset value, beginning of period

  $ 117.61     $ 123.50      $ 118.37      $ 80.66      $ 101.13      $ 96.31  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    2.32       4.24        3.91        3.51        3.51        3.31  

Net realized and unrealized gain (loss)(b)

    (12.97     (5.87      4.97        37.74        (20.30      4.80  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    (10.65     (1.63      8.88        41.25        (16.79      8.11  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions from net investment income(c)

    (2.28     (4.26      (3.75      (3.54      (3.68      (3.29
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 104.68     $ 117.61      $ 123.50      $ 118.37      $ 80.66      $ 101.13  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return(d)

               

Based on net asset value

    (9.13 )%(e)      (1.23 )%       7.63      52.54      (16.96 )%       8.63
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets(f)

               

Total expenses

    0.38 %(g)      0.38      0.38      0.38      0.39      0.39
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income

    4.13 %(g)      3.52      3.23      3.78      3.60      3.40
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

               

Net assets, end of period (000)

  $ 17,089,635     $ 21,422,388      $ 21,666,936      $ 18,495,567      $ 13,257,023      $ 17,585,695  
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate(h)

    3     15      15      55      6      21
 

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average shares outstanding.

(b) 

The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

 
(c) 

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

(d) 

Where applicable, assumes the reinvestment of distributions.

(e) 

Not annualized.

(f) 

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

(g) 

Annualized.

(h) 

Portfolio turnover rate excludes in-kind transactions.

See notes to financial statements.

 

 

F I N A N C I A L   H I G H L I G H T S

  37


Notes to Financial Statements (unaudited)

 

1.

ORGANIZATION

iShares Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Delaware statutory trust and is authorized to have multiple series or portfolios.

These financial statements relate only to the following funds (each, a “Fund” and collectively, the “Funds”):

 

iShares ETF   Diversification
Classification
 

Core Dividend

    Diversified  

Core Dividend Growth

    Diversified  

Core High Dividend

    Non-Diversified  

Select Dividend

    Diversified  

 

2.

SIGNIFICANT ACCOUNTING POLICIES

The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:

Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend date. Non-cash dividends, if any, are recorded on the ex-dividend date at fair value. Upon notification from issuers or as estimated by management, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized daily on an accrual basis.

ForeignTaxes: The Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which each Fund invests. These foreign taxes, if any, are paid by each Fund and are reflected in its Statements of Operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “Other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of October 31, 2023, if any, are disclosed in the Statements of Assets and Liabilities.

The Funds file withholding tax reclaims in certain jurisdictions to recover a portion of amounts previously withheld. The Funds may record a reclaim receivable based on collectability, which includes factors such as the jurisdiction’s applicable laws, payment history and market convention. The Statements of Operations include tax reclaims recorded as well as professional and other fees, if any, associated with recovery of foreign withholding taxes.

Bank Overdraft: Certain Funds had outstanding cash disbursements exceeding deposited cash amounts at the custodian during the reporting period. The Funds are obligated to repay the custodian for any overdraft, including any related costs or expenses, where applicable. For financial reporting purposes, overdraft fees, if any, are included in interest expense in the Statements of Operations.

Collateralization: If required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments.

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

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

Indemnifications: In the normal course of business, each Fund enters into contracts that contain a variety of representations that provide general indemnification. The Funds’ maximum exposure under these arrangements is unknown because it involves future potential claims against the Funds, which cannot be predicted with any certainty.

 

3.

INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investment Valuation Policies: Each Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Board of Trustees of the Trust (the “Board”) of each Fund has approved the designation of BlackRock Fund Advisors (“BFA”), the Fund’s investment adviser, as the valuation designee for each Fund. Each Fund determines the fair values of its financial instruments using various independent dealers or pricing services under BFA’s policies. If a security’s market price is not readily available or does not otherwise

 

 

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Notes to Financial Statements (unaudited) (continued)

 

accurately represent the fair value of the security, the security will be valued in accordance with BFA’s policies and procedures as reflecting fair value. BFA has formed a committee (the “Valuation Committee”) to develop pricing policies and procedures and to oversee the pricing function for all financial instruments, with assistance from other BlackRock pricing committees.

Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:

 

   

Equity investments traded on a recognized securities exchange are valued at that day’s official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day may be valued at the last traded price.

 

   

Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV.

 

   

Futures contracts are valued based on that day’s last reported settlement or trade price on the exchange where the contract is traded.

If events (e.g., market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Valuation Committee, in accordance with BFA’s policies and procedures as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Valuation Committee include market approach, income approach and cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Valuation Committee seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Valuation Committee deems relevant and consistent with the principles of fair value measurement.

Fair value pricing could result in a difference between the prices used to calculate a fund’s NAV and the prices used by the fund’s underlying index, which in turn could result in a difference between the fund’s performance and the performance of the fund’s underlying index.

Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:

 

   

Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access;

 

   

Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs); and

 

   

Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Valuation Committee’s assumptions used in determining the fair value of financial instruments).

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

 

4.

SECURITIES AND OTHER INVESTMENTS

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

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

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

 

 

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

  39


Notes to Financial Statements (unaudited) (continued)

 

connection with loaned securities. Upon an event of default, the parties’ obligations to return the securities or collateral to the other party are extinguished, and the parties can resell or re-pledge the loaned securities or the collateral received in connection with the loaned securities in order to satisfy the defaulting party’s net payment obligation for all transactions under the MSLA. The defaulting party remains liable for any deficiency.

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

 

iShares ETF and Counterparty   Securities
Loaned at Value
     Cash
Collateral  Received(a)
    Non-Cash
Collateral Received,
at Fair Value(a)
     Net
Amount
 

Core Dividend Growth

         

Morgan Stanley

  $ 3,770,787      $ (3,770,787   $      $  

 

  (a) 

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

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

 

5.

DERIVATIVE FINANCIAL INSTRUMENTS

Futures Contracts: Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).

Futures contracts are exchange-traded agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained to an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the Statements of Assets and Liabilities.

Securities deposited as initial margin are designated in the Schedule of Investments and cash deposited, if any, are shown as cash pledged for futures contracts in the Statements of Assets and Liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the Statements of Assets and Liabilities. When the contract is closed, a realized gain or loss is recorded in the Statements of Operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest rates, foreign currency exchange rates or underlying assets.

 

6.

INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

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

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

 

iShares ETF   Investment Advisory Fees  

Core Dividend

    0.05

Core Dividend Growth

    0.08  

Core High Dividend

    0.08  

For its investment advisory services to the iShares Select Dividend ETF, BFA is entitled to an annual investment advisory fee, accrued daily and paid monthly by the Fund, based on the Fund’s allocable portion of the aggregate of the average daily net assets of the Fund and certain other iShares funds, as follows:

 

Aggregate Average Daily Net Assets   Investment Advisory Fees  

First $46 billion

    0.4000

Over $46 billion, up to and including $81 billion

    0.3800  

Over $81 billion, up to and including $111 billion

    0.3610  

Over $111 billion, up to and including $141 billion

    0.3430  

Over $141 billion, up to and including $171 billion

    0.3259  

Over $171 billion

    0.3096  

 

 

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Notes to Financial Statements (unaudited) (continued)

 

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

ETF Servicing Fees: Each Fund has entered into an ETF Services Agreement with BRIL to perform certain order processing, Authorized Participant communications, and related services in connection with the issuance and redemption of Creation Units (“ETF Services”). BRIL is entitled to a transaction fee from Authorized Participants on each creation or redemption order for the ETF Services provided. Each Fund does not pay BRIL for ETF Services.

Securities Lending: The U.S. Securities and Exchange Commission (the “SEC”) has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending, including any custodial costs. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan (the “collateral investment fees”). The cash collateral is invested in a money market fund, BlackRock Cash Funds: Institutional or BlackRock Cash Funds: Treasury, managed by BFA, or its affiliates. However, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an annual rate of 0.04%. The SL Agency Shares of such money market fund will not be subject to a sales load, distribution fee or service fee. The money market fund in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value redeemed or temporarily restrict redemptions for up to 10 business days during a 90 day period, in the event that the money market fund’s weekly liquid assets fall below certain thresholds.

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

Pursuant to the current securities lending agreement, each Fund retains 81% of securities lending income (which excludes collateral investment fees) and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

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

The share of securities lending income earned by each Fund is shown as securities lending income - affiliated - net in its Statements of Operations. For the six months ended October 31, 2023, the Funds paid BTC the following amounts for securities lending agent services:

 

   
iShares ETF   Amounts  

Core Dividend Growth

  $ 52,487  

Select Dividend

    237  

Officers and Trustees: Certain officers and/or trustees of the Trust are officers and/or trustees of BlackRock or its affiliates.

Other Transactions: Cross trading is the buying or selling of portfolio securities between funds to which BFA (or an affiliate) serves as investment adviser. At its regularly scheduled quarterly meetings, the Board reviews such transactions as of the most recent calendar quarter for compliance with the requirements and restrictions set forth by Rule 17a-7.

For the six months ended October 31, 2023, transactions executed by the Funds pursuant to Rule 17a-7 under the 1940 Act were as follows:

 

       
iShares ETF   Purchases      Sales      Net Realized
Gain (Loss)
 

Core Dividend

  $ 27,166,082      $ 28,207,082      $ (988,159

Core Dividend Growth

    716,034,495        758,240,703        68,265,671  

Core High Dividend

    545,950,029        280,481,990        4,425,675  

Select Dividend

    67,272,755        3,979,821        (1,067,412

Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is shown as dividends - affiliated in the Statements of Operations.

A fund, in order to improve its portfolio liquidity and its ability to track its underlying index, may invest in shares of other iShares funds that invest in securities in the fund’s underlying index.

 

7.

PURCHASES AND SALES

For the six months ended October 31, 2023, purchases and sales of investments, excluding short-term securities and in-kind transactions, were as follows:

 

iShares ETF   Purchases      Sales  

Core Dividend

  $ 59,083,422      $ 59,179,415  

Core Dividend Growth

    2,323,771,036        2,319,525,891  

Core High Dividend

    3,661,265,810        3,655,820,349  

Select Dividend

    523,365,474        572,040,926  

 

 

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

  41


Notes to Financial Statements (unaudited) (continued)

 

For the six months ended October 31, 2023, in-kind transactions were as follows:

 

     
iShares ETF  

In-kind

Purchases

    

In-kind

Sales

 

Core Dividend

  $ 8,988,916      $ 24,757,455  

Core Dividend Growth

    1,122,487,409        610,896,864  

Core High Dividend

    293,351,079        974,594,635  

Select Dividend

    395,339,687        2,464,554,013  

 

8.

INCOME TAX INFORMATION

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

Management has analyzed tax laws and regulations and their application to the Funds as of October 31, 2023, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.

As of April 30, 2023, the Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:

 

iShares ETF   Non-Expiring Capital
Loss  Carryforwards
 

Core Dividend

  $ 27,102,633  

Core Dividend Growth

    1,198,672,614  

Core High Dividend

    1,517,558,189  

Select Dividend

    1,183,909,294  

As of October 31, 2023, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:

 

         
iShares ETF   Tax Cost      Gross Unrealized
Appreciation
     Gross Unrealized
Depreciation
    Net Unrealized
Appreciation
(Depreciation)
 

Core Dividend

  $ 255,289,092      $ 8,863,888      $ (27,645,836   $ (18,781,948

Core Dividend Growth

    21,326,772,276        2,909,668,657        (1,470,548,131)       1,439,120,526  

Core High Dividend

    10,322,356,491        365,006,401        (1,005,420,820     (640,414,419

Select Dividend

    18,873,732,603        1,045,332,592        (2,864,499,944     (1,819,167,352

 

9.

PRINCIPAL RISKS

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

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

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

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

Valuation Risk: The market values of equities, such as common stocks and preferred securities or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company. They may also decline due to factors which affect a particular industry or industries. A fund may invest in illiquid investments. An illiquid investment is any investment that a fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A fund may experience difficulty in selling illiquid investments in a timely manner at the price that it believes the investments are worth. Prices may fluctuate widely over short or extended periods in response to company, market or economic news. Markets also tend to move in cycles, with periods of rising and falling prices. This volatility may cause a fund’s NAV to experience significant

 

 

42  

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Notes to Financial Statements (unaudited) (continued)

 

increases or decreases over short periods of time. If there is a general decline in the securities and other markets, the NAV of a fund may lose value, regardless of the individual results of the securities and other instruments in which a fund invests.

The price each Fund could receive upon the sale of any particular portfolio investment may differ from each Fund’s valuation of the investment, particularly for securities that trade in thin or volatile markets or that are valued using a fair valuation technique or a price provided by an independent pricing service. Changes to significant unobservable inputs and assumptions (i.e., publicly traded company multiples, growth rate, time to exit) due to the lack of observable inputs. may significantly impact the resulting fair value and therefore each Fund’s results of operations. As a result, the price received upon the sale of an investment may be less than the value ascribed by each Fund, and each Fund could realize a greater than expected loss or lesser than expected gain upon the sale of the investment. Each Fund’s ability to value its investments may also be impacted by technological issues and/or errors by pricing services or other third-party service providers.

Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Funds manage counterparty credit risk by entering into transactions only with counterparties that BFA believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the Statements of Assets and Liabilities, less any collateral held by the Funds.

A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.

With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.

Geographic/Asset Class Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its Schedule of Investments.

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

The Funds invest a significant portion of their assets in securities of issuers located in the United States. A decrease in imports or exports, changes in trade regulations, inflation and/or an economic recession in the United States may have a material adverse effect on the U.S. economy and the securities listed on U.S. exchanges. Proposed and adopted policy and legislative changes in the United States may also have a significant effect on U.S. markets generally, as well as on the value of certain securities. Governmental agencies project that the United States will continue to maintain elevated public debt levels for the foreseeable future which may constrain future economic growth. Circumstances could arise that could prevent the timely payment of interest or principal on U.S. government debt, such as reaching the legislative “debt ceiling.” Such non-payment would result in substantial negative consequences for the U.S. economy and the global financial system. If U.S. relations with certain countries deteriorate, it could adversely affect issuers that rely on the United States for trade. The United States has also experienced increased internal unrest and discord. If these trends were to continue, they may have an adverse impact on the U.S. economy and the issuers in which the Funds invest.

Significant Shareholder Redemption Risk: Certain shareholders may own or manage a substantial amount of fund shares and/or hold their fund investments for a limited period of time. Large redemptions of fund shares by these shareholders may force a fund to sell portfolio securities, which may negatively impact the fund’s NAV, increase the fund’s brokerage costs, and/or accelerate the realization of taxable income/gains and cause the fund to make additional taxable distributions to shareholders.

 

10.

CAPITAL SHARE TRANSACTIONS

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

Transactions in capital shares were as follows:

 

 

 
   

 

Six Months Ended

10/31/23

 

          

 

Year Ended

04/30/23

 

 
 

 

 

      

 

 

 
iShares ETF  

 

Shares

   

 

Amount

           

 

Shares

   

 

Amount

 

Core Dividend

          

Shares sold

    250,000     $ 9,081,019          3,000,000     $ 113,592,280  

Shares redeemed

    (650,000     (24,954,982        (2,700,000     (99,967,100
 

 

 

   

 

 

      

 

 

   

 

 

 
    (400,000   $ (15,873,963        300,000     $ 13,625,180  
 

 

 

   

 

 

      

 

 

   

 

 

 

 

 

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

  43


Notes to Financial Statements (unaudited) (continued)

 

 

   

 

Six Months Ended

10/31/23

 

          

 

Year Ended

04/30/23

 

 
 

 

 

      

 

 

 
iShares ETF  

 

Shares

   

 

Amount

           

 

Shares

   

 

Amount

 

Core Dividend Growth

          

Shares sold

    22,700,000     $ 1,129,529,079          70,700,000     $ 3,514,986,304  

Shares redeemed

    (12,050,000     (614,532,829        (58,300,000     (2,937,995,658
 

 

 

   

 

 

      

 

 

   

 

 

 
    10,650,000     $ 514,996,250          12,400,000     $ 576,990,646  
 

 

 

   

 

 

      

 

 

   

 

 

 

Core High Dividend

          

Shares sold

    2,950,000     $ 295,927,118          64,500,000     $ 6,706,128,749  

Shares redeemed

    (9,800,000     (981,714,524        (49,000,000     (4,950,934,523
 

 

 

   

 

 

      

 

 

   

 

 

 
    (6,850,000   $ (685,787,406        15,500,000     $ 1,755,194,226  
 

 

 

   

 

 

      

 

 

   

 

 

 

Select Dividend

          

Shares sold

    3,600,000     $ 405,101,684          48,000,000     $ 5,672,978,227  

Shares redeemed

    (22,500,000     (2,517,837,994        (41,250,000     (4,764,707,405
 

 

 

   

 

 

      

 

 

   

 

 

 
    (18,900,000   $ (2,112,736,310        6,750,000     $ 908,270,822  
 

 

 

   

 

 

      

 

 

   

 

 

 

The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to BRIL, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in shares sold in the table above.

From time to time, settlement of securities related to in-kind contributions or in-kind redemptions may be delayed. In such cases, securities related to in-kind transactions are reflected as a receivable or a payable in the Statements of Assets and Liabilities.

 

11.

SUBSEQUENT EVENTS

Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were available to be issued and has determined that there were no subsequent events requiring adjustment or additional disclosure in the financial statements.

 

 

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Board Review and Approval of Investment Advisory Contract

 

iShares Core Dividend ETF, iShares Core Dividend Growth ETF, iShares Core High Dividend ETF (each the “Fund”)

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

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

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

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2022, to that of such relevant comparison fund(s) for the same periods. The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.

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

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

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

Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates: The Board reviewed information about the estimated profitability to BlackRock in managing the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Agreement), and other sources of revenue and expense to BFA and its affiliates from the Fund’s operations for the last calendar year. The Board reviewed BlackRock’s methodology for calculating estimated profitability of the iShares funds, noting that the 15(c) Committee and the Board had focused on the methodology and profitability presentation. The Board recognized that profitability may be affected by numerous factors, including, among other things, fee waivers by BFA, the types of funds managed, expense allocations and business mix. The Board thus recognized that

 

 

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Board Review and Approval of Investment Advisory Contract (continued)

 

calculating and comparing profitability at individual fund levels is challenging. The Board discussed with management the sources of direct and ancillary revenue, including the revenues to BTC, a BlackRock affiliate, from securities lending by the Fund. The Board also discussed BFA’s estimated profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below).

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

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

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

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

The Board received detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate.

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

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

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

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Board Members who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Board Members”), is required annually to consider the approval of the Investment Advisory Agreement between the Trust and BFA (the “Advisory Agreement”) on behalf of the Fund. The Board’s consideration entails a year-long process whereby the Board and its committees (composed solely of Independent Board Members) assess BlackRock’s services to the Fund, including investment management; fund accounting; administrative and shareholder services; oversight of the Fund’s service providers; risk management and oversight; legal and compliance services; and ability to meet

 

 

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Board Review and Approval of Investment Advisory Contract (continued)

 

applicable legal and regulatory requirements. The Independent Board Members requested, and BFA provided, such information as the Independent Board Members, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Agreement. At meetings on May 2, 2023 and May 15, 2023, a committee composed of all of the Independent Board Members (the “15(c) Committee”), with independent counsel, met with management and reviewed and discussed information provided in response to initial requests of the 15(c) Committee and/or its independent counsel, and requested certain additional information, which management agreed to provide. At a meeting held on June 7-8, 2023, the Board, including the Independent Board Members, reviewed the additional information provided by management in response to these requests.

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

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

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-year, three-year, five-year, ten-year, and since inception periods, as applicable, and for the quarter ended December 31, 2022, to that of such relevant comparison fund(s) for the same periods. The Board noted that the Fund seeks to track its specified underlying index and that, during the year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its underlying index. Such periodic comparative performance information, including additional detailed information as requested by the Board, was also considered. The Board noted that the Fund generally performed in line with its underlying index over the relevant periods.

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

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

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

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

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

 

 

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Board Review and Approval of Investment Advisory Contract (continued)

 

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

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

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

The Board received detailed information regarding how the Other Accounts generally differ from the Fund, including in terms of the types of services and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded investment vehicle, as compared to the Other Accounts, particularly those that are institutional clients, in light of differing regulatory requirements and client-imposed mandates. The Board noted that BFA and its affiliates do not manage Other Accounts with substantially the same investment objective and strategy as the Fund and that track the same index as the Fund. The Board also acknowledged management’s assertion that, for certain iShares funds, and for client segmentation purposes, BlackRock has launched an iShares fund that may provide a similar investment exposure at a lower investment advisory fee rate.

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

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

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

 

 

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Supplemental Information  (unaudited)

 

Section 19(a) Notices

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

October 31, 2023

 

     Total Cumulative Distributions
for the Fiscal Year-to-Date
             % Breakdown of the Total Cumulative
Distributions for the Fiscal Year-to-Date
 
iShares ETF   Net
Investment
Income
     Net Realized
Capital Gains
     Return of
Capital
     Total Per
Share
             Net
Investment
Income
    Net Realized
Capital Gains
    Return of
Capital
    Total Per
Share
 

Core High Dividend(a)

  $   1.802137      $      $   0.072370      $   1.874507           96         4     100

Select Dividend(a)

    2.202923               0.078170        2.281093                 97             3       100  

 

(a) 

The Fund estimates that it has distributed more than its net investment income and net realized capital gains; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the shareholder’s investment in the Fund is returned to the shareholder. A return of capital does not necessarily reflect the Fund’s investment performance and should not be confused with “yield” or “income”. When distributions exceed total return performance, the difference will incrementally reduce the Fund’s net asset value per share.

Tailored Shareholder Reports for Open-End Mutual Funds and ETFs

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

 

 

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General Information

 

Electronic Delivery

Shareholders can sign up for e-mail notifications announcing that the shareholder report or prospectus has been posted on the iShares website at iShares.com. Once you have enrolled, you will no longer receive prospectuses and shareholder reports in the mail.

To enroll in electronic delivery:

 

   

Go to icsdelivery.com.

   

If your brokerage firm is not listed, electronic delivery may not be available. Please contact your broker-dealer or financial advisor.

Householding

Householding is an option available to certain fund investors. Householding is a method of delivery, based on the preference of the individual investor, in which a single copy of certain shareholder documents and Rule 30e-3 notices can be delivered to investors who share the same address, even if their accounts are registered under different names. Please contact your broker-dealer if you are interested in enrolling in householding and receiving a single copy of prospectuses and other shareholder documents, or if you are currently enrolled in householding and wish to change your householding status.

Availability of Quarterly Schedule of Investments

The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to their reports on Form N-PORT. The Funds’ Forms N-PORT are available on the SEC’s website at sec.gov. Additionally, each Fund makes its portfolio holdings for the first and third quarters of each fiscal year available at iShares.com/fundreports.

Availability of Proxy Voting Policies and Proxy Voting Records

A description of the policies and procedures that the iShares Funds use to determine how to vote proxies relating to portfolio securities and information about how the iShares Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request (1) by calling toll-free 1-800-474-2737; (2) on the iShares website at iShares.com; and (3) on the SEC website at sec.gov.

A description of the Trust’s policies and procedures with respect to the disclosure of the Fund’s portfolio securities is available in the Fund Prospectus. The Fund discloses its portfolio holdings daily and provides information regarding its top holdings in Fund fact sheets at iShares.com.

 

 

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Glossary of Terms Used in this Report

 

Portfolio Abbreviation
NVS   Non-Voting Shares
REIT   Real Estate Investment Trust
S&P   Standard & Poor’s

 

 

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Want to know more?

iShares.com  |  1-800-474-2737

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

Investing involves risk, including possible loss of principal.

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

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

©2022 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc. or its subsidiaries. All other marks are the property of their respective owners.

iS-SAR-409-1023

 

 

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