Investment Objective
The Portfolio seeks to track the investment results of an index composed of mid-capitalization U.S. equities.
Investment Strategy
The Portfolio invests substantially all its assets in iShares Core S&P Mid-Cap ETF. The Fund seeks to track the investment results of the S&P MidCap 400 Index, which measures the performance of the mid-capitalization sector of the U.S. equity market, as determined by S&P Dow Jones Indices LLC (the "SPDJI"). As of March 31, 2021, the index included approximately 6% of the market capitalization of all publicly-traded U.S. equity securities. The securities in the index are weighted based on the float-adjusted market value of their outstanding shares, and have, as of March 31, 2021, a market capitalization between $1.3 billion and $14.8 billion at the time of inclusion in the index, which may fluctuate depending on the overall level of the equity markets. The securities are selected by SPDJI based on SPDJI's liquidity measures. The index consists of securities from a broad range of industries. As of March 31, 2021, a significant portion of the index is represented by securities of companies in the financials and industrials industries or sectors. The components of the index are likely to change over time.
BlackRock uses a "passive" or indexing approach to try to achieve the Fund's investment objective. Unlike many investment companies, the Fund does not try to "beat" the index it tracks and does not seek temporary defensive positions when markets decline or appear overvalued.
Indexing may eliminate the chance that the Fund will substantially outperform the underlying index but also may reduce some of the risks of active management, such as poor security selection. Indexing seeks to achieve lower costs and better after-tax performance by aiming to keep portfolio turnover low in comparison to actively managed investment companies.
BlackRock uses a representative sampling indexing strategy to manage the Fund. "Representative sampling" is an indexing strategy that involves investing in a representative sample of securities that collectively has an investment profile similar to that of an applicable underlying index. The securities selected are expected to have, in the aggregate, investment characteristics (based on factors such as market capitalization and industry weightings), fundamental characteristics (such as return variability and yield) and liquidity measures similar to those of an applicable underlying index. The Fund may or may not hold all of the securities in the index.
The Fund generally will invest at least 80% of its assets in the component securities of its underlying index and in investments that have economic characteristics that are substantially identical to the component securities of its underlying index (i.e., depositary receipts representing securities of the underlying index) and may invest up to 20% of its assets in certain futures, options and swap contracts, cash and cash equivalents, including shares of money market funds advised by BlackRock or its affiliates, as well as in securities not included in the underlying index, but which BlackRock believes will help the Fund track the underlying index. Cash and cash equivalent investments associated with a derivative position will be treated as part of that position for the purposes of calculating investments not included in the underlying index. The Fund seeks to track the investment results of the underlying index before fees and expenses of the Fund.
The Fund may lend securities representing up to one-third of the value of the Fund's total assets (including the value of any collateral received).
The underlying index is a product of SPDJI, which is independent of the Fund and BlackRock. SPDJI determines the composition and relative weightings of the securities in the index and publishes information regarding the market value of the index.
Industry Concentration Policy. The Fund will concentrate its investments (i.e., hold 25% or more of its total assets) in a particular industry or group of industries to approximately the same extent that the underlying index is concentrated. For purposes of this limitation, securities of the U.S. government (including its agencies and instrumentalities) and repurchase agreements collateralized by U.S. government securities are not considered to be issued by members of any industry.
Investment Risks
Asset Class Risk, Authorized Participant Concentration Risk, Concentration Risk, Cybersecurity Risk, Equity Securities Risk, Financial Sector Risk, Index-Related Risk, Industrials Sector Risk, Infectious Illness Risk, Information Technology Sector Risk, Issuer Risk, Management Risk, Market Risk, Market Trading Risk, Mid-Capitalization Companies Risk, Operational Risk, Passive Investment Risk, Risk of Investing in the U.S., Securities Lending Risk, and Tracking Error Risk. These risks are discussed under BlackRock (iShares) Investment Risks, per the disclosure booklet.
