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November 29, 2024 |
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Summary Prospectus |
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iShares U.S. Consumer Focused
ETF | IEDI |
Cboe BZX
Before you invest, you may want to review the Fund’s prospectus, which contains more information about the Fund and its risks. You can find the Fund’s prospectus (including amendments and supplements) and other information about the Fund, including the Fund’s statement of additional information and shareholder reports, online at https://www.blackrock.com/prospectus. You can also get this information at no cost by calling 1-800-iShares (1-800-474-2737) or by sending an e-mail request to
iSharesETFs@blackrock.com, or from your financial professional. The Fund’s prospectus and statement of additional information, both dated November 29, 2024, as amended and supplemented from time to time, are incorporated by reference into (legally made a part of) this Summary Prospectus. Information on the Fund’s net asset value, market price, premiums and discounts, and bid-ask spreads can be found at https://www.iShares.com.
The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this prospectus. Any representation to the contrary is a criminal offense.
iSHARES® U.S. CONSUMER FOCUSED ETF
Ticker: IEDIStock Exchange: Cboe BZX
Investment Objective
The iShares U.S. Consumer Focused ETF (the
“Fund”) seeks to provide access to U.S. companies with discretionary spending exposure, as classified using a proprietary
classification system, while targeting increased exposure to U.S. companies with a greater proportion of consumer spending revenues and consumer goods and service production in
the U.S. relative to the proprietary classification system.
Fees and Expenses
The following table describes the fees and expenses that you will incur if you buy, hold and sell shares of the Fund. The investment advisory agreement between iShares U.S. ETF Trust (the “Trust”) and BlackRock Fund Advisors
(“BFA”) (the “Investment Advisory Agreement”) provides that BFA will pay all
operating expenses of the Fund, except: (i) the management fees, (ii) interest expenses, (iii) taxes, (iv) expenses incurred with respect to the acquisition and disposition of
portfolio securities and the execution of portfolio transactions, including brokerage commissions, (v) distribution fees or expenses, and (vi) litigation expenses and any
extraordinary expenses.
You may pay other fees, such as brokerage commissions and other fees to financial intermediaries, which are not reflected in the tables and examples below.
| Annual Fund
Operating Expenses (ongoing expenses that you pay each year as a
percentage of the value of your investments)1 | |||
| Management
Fees |
Distribution and Service (12b-1)
Fees |
Other
Expenses2 |
Total
Annual Fund
Operating
Expenses |
| 0.18% |
None |
0.00% |
0.18% |
1Operating expenses paid by BFA under the Investment Advisory Agreement exclude acquired fund fees and expenses, if any.
2The amount rounded to 0.00%.
Example. This Example is intended to help you compare the cost of owning shares of the Fund with the
cost of investing in other funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then sell all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions, your costs would be:
| 1
Year |
3
Years |
5
Years |
10
Years |
| $18 |
$58 |
$101 |
$230 |
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Portfolio Turnover. The Fund may pay transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are
not reflected in the Annual Fund Operating Expenses or in the Example, affect the Fund’s performance.
During the most recent fiscal year, the Fund's portfolio turnover rate was 15% of the average value of its
portfolio.
Principal Investment Strategies
The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in U.S. listed common stock of large-, mid- and
small-capitalization consumer discretionary spending companies, as defined by a proprietary classification
system (“Consumer Discretionary
Spending Evolved Sector”),
while targeting increased exposure to U.S. companies with a greater proportion of consumer spending
revenues and consumer goods and service production in the U.S. relative to the Consumer Discretionary
Spending Evolved Sector. The Consumer Discretionary Spending Evolved Sector classification process, which
uses data analysis tools consisting, in part, of machine learning, natural language processing
(“NLP”) and clustering algorithms to allocate companies to one or more sectors according to a proprietary classification system, is forward looking and evolves as companies
evolve.
The eligible universe of securities that are part of the
classification process includes U.S. listed common stock of large-, mid- and small-capitalization
companies. Based on data and information in the company’s public filings
(e.g., regulatory filings), a company is classified in one or more of the twelve defined sectors (each an “Evolved Sector”). Currently these public
filings consist of several years of a company’s 10-Ks and S-1s (if no 10-Ks are available). The
Fund's allocation rules additionally utilize proprietary data to target increased exposure to U.S. listed companies with a greater proportion of consumer spending revenues and consumer goods and services production in the U.S. relative to the Consumer
Discretionary Spending Evolved Sector (“US Consumer Score”). While the Fund is actively managed, the Fund generally allocates its investments to securities of its Evolved Sectors on
a market capitalization basis (based on the available free floating capitalization) while modifying
allocations to companies based on their US Consumer Score. The Evolved Sector classification system allows
for a company to be classified into multiple sectors rather than being assigned solely to a single sector. For the Evolved Sectors, the market capitalization of a single company will be allocated proportionally based on the one or more
Evolved Sectors in which the company is classified. This reflects the multi-dimensional nature of these
companies. Evolved Sector constituents are expected to evolve dynamically over time to reflect changing
business models. The constituents in the Evolved Sectors will be reviewed and updated at least annually.
BFA may exercise discretion in managing the classification process in limited instances. For example, a company may be excluded (or its inclusion limited) from an Evolved Sector,
in part or whole, most commonly in response to position limit restrictions, limited liquidity of a
particular security or the fit of a particular company in the Fund. This is different from traditional
classification systems that typically will assign a company only to
one sector and tend to group companies
together on the basis of backward looking metrics like revenue. The Fund will not provide the same returns
as a fund that tracks the consumer discretionary sector as traditionally defined by other classification systems and as a result may not be appropriate for an investor seeking the same exposure as the consumer discretionary sector as
defined by such classification systems.
In certain situations or market conditions, the Fund may temporarily depart from its normal investment process, provided
that the alternative, in the opinion of BFA, is consistent with the Fund’s investment objective and
is in the best interest of the Fund. The Fund has no stated minimum holding period for investments and may
buy or sell securities whenever Fund management sees an appropriate opportunity. The Fund may engage in
active and frequent trading of its investments.
As of July 31, 2024,
there were twelve Evolved Sectors: Consumer Staples, Discretionary Spending, Energy, Financials, Healthcare
Staples, Industrials, Innovative Healthcare, Media and Entertainment, Real Estate, Technology,
Telecommunications and Utilities. Sector classifications are reviewed on a quarterly basis and may evolve
over time.
The Fund will hold common stock of those companies that
fall into the Consumer Discretionary Spending Evolved Sector, while targeting increased exposure to
companies with higher US Consumer Scores relative to the Consumer Discretionary Spending Evolved Sector.
Companies in the Consumer Discretionary Spending Evolved Sector have economic characteristics that have
been historically correlated with companies traditionally defined as consumer discretionary companies. The
Fund may also invest in other securities, including but not limited to, cash and cash equivalents, including shares of money market funds advised by BFA or its affiliates. The Fund's 80% investment policy may be changed by the Fund's Board
of Trustees (the “Board”) upon 60 days' notice to shareholders.
The Fund is an actively managed exchange-traded fund (“ETF”) and does not seek to replicate the performance of a specified index and may have a higher degree of portfolio turnover than such index funds.
The Fund may lend securities representing up to one-third of the value of the Fund's total assets (including the value of the collateral received).
Industry Concentration Policy. The Fund will concentrate its investments (i.e., hold 25% or more of its total assets) in an industry or group of industries that constitute the discretionary spending sector. 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.
Industry concentration designations are based on output of the classification methodology referenced above.
Summary of Principal Risks
As with any investment, you could lose all or part of your investment in the Fund, and the Fund's performance could trail that of other investments. The Fund is subject to certain
risks, including the principal risks noted below, any of which may adversely affect the Fund's net asset
value per share
(“NAV”),
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trading price, yield, total return and
ability to meet its investment objective. Certain key risks are prioritized below (with others following in
alphabetical order), but the relative significance of any risk is difficult to predict and may change over time. You should review each risk factor carefully.
Risk of Investing in the U.S. Investing in U.S. issuers subjects the Fund to legal, regulatory, political, currency, security, and economic risks that are specific to the U.S. Certain changes in the U.S., such as a weakening of the U.S. economy or a
decline in its financial markets, may have an adverse effect on U.S. issuers.
Consumer Goods and Services Companies Risk.
Consumer goods and services companies
(“consumer
companies”) face risks related
to changes in consumer preferences and disposable income, commodity prices, government regulation, supply chain disruptions, damage to brand or reputation, economic slowdown and labor shortages, among other things.
Evolved Sector Model Risk. BFA and the Fund cannot offer
assurances that the Evolved Sector classification system, the US Consumer Score and the constituent
allocation rules will achieve the Fund’s investment objective or maintain a level of risk similar to
that of a portfolio of companies defined as consumer discretionary companies by another classification system. In addition, a company categorized in a particular sector under another classification system may not be allocated
completely or at all to the corresponding Evolved Sector. Similarly, a company that is allocated in part or
completely to a particular Evolved Sector may not be included in the corresponding sector defined by
another classification system.
Equity Securities Risk. Equity securities are subject to changes in value, and their values may be more volatile than those of other asset classes. The value of a security may decline for a number of reasons that may directly relate to the issuer as
well as due to general industry or market conditions. Common stock is subordinated to preferred securities
and debt in a company’s capital structure. Common stock has the lowest priority, and the greatest
risk, with respect to dividends and any liquidation payments in the event of an issuer’s bankruptcy.
Market Risk. The Fund could lose money over short periods due to short-term market movements and over longer periods during more prolonged market downturns. Local, regional or global
events such as war, acts of terrorism, pandemics or other public health issues, recessions, the prospect or
occurrence of a sovereign default or other financial crisis, or other events could have a significant
impact on the Fund and its investments and could result in increased premiums or discounts to the Fund’s NAV.
Asset Class Risk. The securities and other assets in the Fund’s portfolio may underperform in comparison to financial markets generally, a particular financial market, an index, or
other asset classes.
Assets Under Management (AUM) Risk. From time to time, an Authorized Participant (as defined below in Authorized Participant Concentration Risk), a third-party investor, the Fund’s adviser, an affiliate of the Fund’s adviser, or another fund may
invest in the Fund and hold its investment for a specific period of time to allow the Fund to achieve size
or scale. There can be no assurance that any such entity would not redeem its investment or that the size
of the Fund would be maintained at such
levels, which could negatively impact the Fund.
Authorized Participant Concentration Risk. An “Authorized Participant” is a member or participant of a clearing agency registered with the SEC, which has a written agreement with the Fund or one of its service providers that allows the
Authorized Participant to place orders for the purchase and redemption of creation units (“Creation Units”). Only an Authorized Participant may engage in creation or redemption transactions directly with the Fund. There are a limited number of institutions that may act as Authorized Participants for the Fund, including on
an agency basis on behalf of other market participants. No Authorized Participant is obligated to engage in
creation or redemption transactions. To the extent that Authorized Participants exit the business or do not
place creation or redemption orders for the Fund and no other Authorized Participant places orders, Fund
shares are more likely to trade at a premium or discount to NAV and possibly face trading halts or
delisting.
Concentration
Risk. The Fund may be susceptible to an increased risk of loss, including losses due to adverse events that
affect the Fund’s investments more than the market as a whole, to the extent that the Fund’s
investments are concentrated in the securities or other assets of one or more issuers, countries or other
geographic units, markets, industries, project types, or asset classes.
Cybersecurity Risk. Failures or breaches of the electronic systems of the Fund, its adviser, distributor, other service providers, counterparties, or issuers of assets in which the Fund invests may cause disruptions that negatively impact
the Fund and its shareholders. While the Fund has established business continuity plans and risk management
systems seeking to address system breaches or failures, there are inherent limitations in such plans and
systems. The Fund cannot control the cybersecurity plans and systems of its service providers,
counterparties, and other third parties whose activities affect the Fund. In addition, cyber incidents may
adversely impact the issuers of securities in which the Fund invests, which may cause such investments to
lose value.
Issuer Risk. The performance of the Fund depends on the performance of individual securities or other assets to which the Fund has exposure. The value of securities or other
assets may decline, or perform differently from the market as a whole, due to changes in the financial
condition or credit rating of the issuer or counterparty.
Large-Capitalization Companies Risk. Large-capitalization companies may be less able than smaller-capitalization companies to adapt to changing market conditions and competitive challenges. Large-capitalization companies may be more mature and subject to more limited growth potential
compared with smaller-capitalization companies. The performance of large-capitalization companies could
trail the overall performance of the broader securities markets.
Management Risk. The Fund is subject to management
risk, which is the risk that the investment process, techniques, models and/or risk analyses applied by BFA
will not produce the desired results. The securities or other assets selected by BFA may result in returns
that are inconsistent with the Fund’s investment
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objective, and the Fund may underperform the
market or any relevant benchmark. In addition, legislative, regulatory, or tax developments may affect the
investment techniques available to BFA in connection with managing the Fund and may adversely affect the
ability of the Fund to achieve its investment objective.
Market Trading Risk. The Fund faces numerous market trading risks, including the potential lack of an active market for Fund shares (including through a trading halt), losses from trading in secondary markets, periods of high volatility, and
disruptions in the process of creating and redeeming Fund shares. Any of these factors, among others, may
lead to the Fund’s shares trading in the secondary market at a premium or discount to NAV or to the
intraday value of the Fund’s portfolio holdings. If you buy Fund shares at a time when the market
price is at a premium to NAV or sell Fund shares at a time when the market price is at a discount to NAV,
you may pay significantly more or receive significantly less than the underlying value of the Fund shares.
Non-Diversification Risk. The Fund is classified as
“non-diversified.”
This means that, compared with funds that are classified as “diversified,” the Fund may invest a greater percentage of its assets in securities or other instruments representing a small number of issuers or counterparties and thus may be more susceptible to the risks associated with
these particular issuers or counterparties. As a result, the Fund's performance may depend to a greater
extent on the performance of a small number of issuers or counterparties, which may lead to more volatility
in the Fund’s NAV.
Operational Risk. The Fund is exposed to operational risks arising from a number of factors, including, but not limited to, human error, processing and communication errors, errors of the Fund’s service providers, counterparties or other third
parties, failed or inadequate processes and technology or systems failures. The Fund and BFA seek to reduce
these operational risks through controls and procedures. However, these measures do not address every
possible risk and may be inadequate to address significant operational risks.
Securities Lending Risk. The Fund may engage in
securities lending. Securities lending involves the risk that the Fund may lose money because the borrower
of the loaned securities fails to return the securities in a timely manner or at all. The Fund could also
lose money in the event of a decline in the value of collateral provided for loaned securities or a decline in the value of any investments made with cash collateral. These events could also trigger adverse tax consequences for the
Fund.
Small Fund Risk. When the Fund’s size is small, the Fund may experience low trading volume and wide bid/ask spreads. In addition, the Fund may face the risk of being delisted if it does not meet certain requirements set by the listing
exchange. Any resulting liquidation of the Fund could lead to elevated transaction costs for the Fund and
negative tax consequences for its shareholders.
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Performance
Information
The Fund's total returns for the period prior to December
1, 2022 as reflected in the bar chart and the table are the returns of the Fund when it followed a different investment objective and different investment strategies and
investment process under the name “iShares Evolved U.S. Discretionary Spending ETF.”
The performance information below illustrates how the Fund’s performance has varied over different periods and provides some indication of the risks of investing in the
Fund. The bar chart shows how the performance of the Fund has varied from one calendar year to another over the periods shown. The table compares the Fund’s performance to
that of an appropriate broad-based securities market index. Fund returns assume the reinvestment of any dividends and distributions. The Fund’s returns reflect the impact of any agreements to waive or reimburse expenses, which would reduce performance if not in effect. Past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Updated performance information, including the Fund’s current NAV, may be obtained by visiting www.iShares.com or by calling 1-800-iShares (1-800-474-2737) (toll free).
Calendar Year-by-Year Returns
| |
Return (%) |
Period Ended |
| Calendar Year-to-Date Return |
18.57% |
September 30, 2024 |
| During the periods shown in the chart:
| ||
| Best Quarter |
27.44% |
June 30, 2020 |
| Worst Quarter |
-20.34% |
June 30, 2022 |
Average Annual Total Returns
(for the periods ended December 31, 2023)
(for the periods ended December 31, 2023)
| |
One Year |
Five Years |
Since Fund
Inception |
| (Inception Date: 03/21/2018) |
|
|
|
| Return Before Taxes |
24.26% |
14.29% |
12.20% |
| Return After Taxes on Distributions |
23.89% |
13.86% |
11.76% |
| Return After Taxes on Distributions and Sale of Fund Shares |
14.57% |
11.43% |
9.73% |
| S&P Total Market Index (Returns do not reflect deductions for
fees, expenses or taxes) |
26.06% |
15.05% |
11.44% |
After-tax returns in the table above are calculated using the historical highest
individual U.S. federal marginal income tax rates and do not reflect the impact of state or local taxes. Actual after-tax returns depend on an investor’s tax situation and
may differ from those shown, and after-tax returns shown are not relevant to tax-exempt investors or investors who hold shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts (“IRAs”). Fund returns after taxes on
distributions and sales of Fund shares are calculated assuming that an investor has sufficient capital gains of the same character from other investments to offset any capital
losses from the sales of Fund shares. As a result, Fund returns after taxes on distributions and sales of Fund shares may exceed Fund returns before taxes and/or returns after taxes on distributions.
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Management
Investment Adviser. BlackRock Fund Advisors.
Portfolio Managers. Travis Cooke, Linus Franngard and Jeff Shen (the “Portfolio Managers”) are primarily responsible for the day-to-day management of the Fund. Each Portfolio Manager supervises a portfolio management team. Mr. Cooke and Dr. Shen have been Portfolio Managers of the Fund since 2018. Mr. Franngard has been a Portfolio Manager of the Fund since
2022.
Purchase and Sale of Fund
Shares
The Fund is an ETF. Individual shares of the Fund may only be
bought and sold in the secondary market through a broker-dealer. Because ETF shares trade at market prices
rather than at NAV, shares may trade at a price greater than NAV (a premium) or less than NAV (a discount).
An investor may incur costs attributable to the difference between the highest price a buyer is willing to pay to purchase shares of the Fund (bid) and the lowest price a seller is willing to accept for shares of the Fund (ask)
when buying or selling shares in the secondary market (the “bid-ask spread”).
Tax Information
The Fund intends to make distributions that may be taxable to you as ordinary income or capital gains, unless you are investing
through a tax-deferred arrangement such as a 401(k) plan or an
IRA, in which case, your distributions generally will be taxed when withdrawn.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), BFA or
other related companies may pay the intermediary for marketing activities and presentations, educational
training programs, conferences, the development of technology platforms and reporting systems or other
services related to the sale or promotion of the Fund. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary’s website for more information.
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