UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-22555
FlexShares Trust
(Exact name of registrant as specified in charter)
50 South LaSalle Street
Chicago, Illinois 60603
(Address of principal executive offices) (Zip code)
Michael Mabry, Esq.
Stradley Ronon Stevens & Young, LLP
2005 Market Street, Suite 2600
Philadelphia, Pennsylvania 19103-6996
(Name and Address of Agent for Service)
with a copy to:
Himanshu Surti
Jose Del Real, Esq.
Northern Trust Investments, Inc.
50 South LaSalle Street
Chicago, Illinois 60603
(Name and Address of Agent for Service)
Registrant’s telephone number, including area code: 855-353-9383
Date of fiscal year end: October 31
Date of reporting period: October 31, 2023
Item 1. Reports to Stockholders.
a.) | The following is a copy of the report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1). |
FlexShares® Trust
Annual Report
October 31, 2023
Table of Contents
Letter to Shareholders
Dear Shareholder,
The past year reminded investors of the cyclicality – and resilience – of the capital markets. Despite the ongoing challenges of inflation, rising interest rates, and geopolitical uncertainty, we see reason for optimism as we move forward.
Having emerged from the pandemic with greater momentum than its peers, we believe the U.S. economy can keep growing at a modest pace through the year ahead. We believe the Federal Reserve’s rate hiking cycle appears to be near, if not at, its peak.
Looking abroad, although growth in the Eurozone area has been tepid, unemployment is holding at record lows. Inflation is falling across categories and countries, which may allow workers to achieve real wage gains. Meanwhile, as China’s economy slows after four decades of remarkable growth, other emerging markets are benefiting from improving labor market conditions, fiscal support and excess private savings accumulated through the pandemic.
There are, of course, variables that could potentially mitigate these positive trends – not the least of which being geopolitical tensions and the ongoing movement toward global
decoupling. Given the increase in global macro instability, there is higher potential for market volatility. The short-and long-term ramifications should not be underestimated.
We are pleased to provide this update for the FlexShares exchange-traded funds, sponsored and managed by Northern Trust Asset Management (“NTAM”), for the year ended October 31, 2023. In addition to financial results for each fund, NTAM explains the factors that have influenced its investment decisions and fund performance. As always, we encourage you to make the Insights Section on our website a destination for up to date analysis and perspective.
On behalf of all of us at Northern Trust, I want to thank you for your ongoing confidence and support. We are proud to share our insight and acumen to help you navigate this multifaceted environment.
Best wishes to you and yours for a joyful, safe, and prosperous new year.
Sincerely,
Darek Wojnar, CFA
Senior Advisor, Registered Funds, Northern Trust
Asset Management
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Quality Low Volatility Index Fund Ticker: QLV
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | Fund Inception 7/15/2019 | |
| | | | |
| | | |
FlexShares US Quality Low Volatility Index Fund (Based on Net Asset Value) | | | 4.56 | % | | | 9.46 | % | | | 7.48 | % |
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FlexShares US Quality Low Volatility Index Fund (Based on Market Price) | | | 4.46 | % | | | 9.40 | % | | | 7.47 | % |
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Russell 1000® Index | | | 9.48 | % | | | 9.52 | % | | | 9.40 | % |
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Northern Trust Quality Low Volatility IndexSM | | | 4.77 | % | | | 9.72 | % | | | 7.76 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Quality Low Volatility IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower overall absolute volatility characteristics relative to the Northern Trust 1250 Index (the “Parent Index”), a float-adjusted market capitalization weighted index of U.S. domiciled large- and mid-capitalization companies. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which Northern Trust Investments, Inc. (“NTI”) believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2023, there were 117 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022, U.S. equity markets moved modestly lower as inflation remained elevated and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023 as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)1 growth was more resilient than expected. The Fed continued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June 2023
1 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Quality Low Volatility Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
meeting. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023 as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023 as inflation remained resilient, and there were increased concerns of slowing global growth due to weakness in China’s economy.
Because U.S. domestic investments trended higher, and higher volatile securities outperformed less volatile securities during the 12 months ended October 31, 2023, we believe the low volatility2 approach was a negative driver of Fund performance for the 12-month period. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor3 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12-month period. Overall, the positive performance derived from the quality factor exposure was not enough to offset the negative performance of the low volatility approach, which was the primary source of the Underlying Index’s underperformance against the Russell 1000® Index4 by -4.71%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -21 basis points (“bps”)5, which is reflective of the management fee (-22 bps) and securities lending (+1 bp).
2 | Volatility is the measurement of the price movements of a group of stocks over a defined time frame. |
3 | The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index. |
4 | The Russell 1000® Index refers to a stock market index that represents the 1000 top companies in the United States. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® Developed | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Markets ex-US Quality Low Volatility Index Fund Ticker: QLVD
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | Fund Inception 7/15/2019 | |
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FlexShares Developed Markets ex-US Quality Low Volatility Index Fund (Based on Net Asset Value) | | | 10.16 | % | | | 3.15 | % | | | 1.31 | % |
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FlexShares Developed Markets ex-US Quality Low Volatility Index Fund (Based on Market Price) | | | 10.41 | % | | | 3.20 | % | | | 1.45 | % |
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MSCI World ex-US Index | | | 12.56 | % | | | 5.97 | % | | | 2.93 | % |
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Northern Trust Developed Markets ex-US Quality Low Volatility IndexSM | | | 10.30 | % | | | 3.33 | % | | | 1.52 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.33% and the net expense ratio is 0.32%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Developed Markets ex-US Quality Low Volatility IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower overall absolute volatility characteristics relative to a broad universe of securities domiciled in developed market countries, excluding the U.S. (the “Parent Index”). The Parent Index is a subset of the Northern Trust Global Index, where eligible securities are limited to those securities domiciled in non-U.S. developed market countries and designated as large- and midcapitalization companies by Northern Trust Investments, Inc. (“NTI”), acting in its capacity as the index provider. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which NTI believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2023, there were 166 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on developed international equity securities generally traded higher. Over the course of the 12-month period, the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, developed international markets rose as falling inflation in Europe, a stabilized fiscal environment in the United Kingdom and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported
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FlexShares® Developed | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Markets ex-US Quality Low Volatility Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
equity security prices. Developed international equities continued higher in Q1 of 2023 as investors looked past concerns in the banking sector to falling energy prices, lower inflation in Europe, and strength in the technology and consumer discretionary sectors. Developed international equity securities continued higher in Q2 of 2023, but, in the aggregate, lagged U.S. equity markets as regional performance varied greatly between different markets. Japanese equity markets moved higher on the back of corporate governance reform while Eurozone equities benefited from technology and semiconductor companies connected to artificial intelligence. Equity markets in the United Kingdom traded lower in local currency terms, but were positive in USD terms as falling energy prices and monetary tightening by the Bank of England impacted equities. Asia Pacific equity markets excluding Japan were lower as concerns over growth in China due to weak consumer spending as well as increased geopolitical tensions between the U.S. and China impacted the region. Developed international equities declined in Q3 of 2023 as higher energy prices and concerns on consumer spending in China and Europe weighed on investors’ global growth outlook. Developed equities continued lower in October of 2023 as slowing global growth and increased geopolitical tensions weighed on markets.
Because developed international investments trended higher, and higher volatile securities outperformed less volatile securities during the 12 months ended October 31, 2023, we believe the low volatility1 approach was a negative driver of Fund performance for the 12-month period. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor2 companies, resulting
in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the quality factor exposure was not enough to offset the negative performance of the low volatility approach, which was the primary source of the Underlying Index’s underperformance against the MSCI World ex-US Index3 by -2.26%. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12month period was -14 basis points (“bps”)4, which is reflective of the Fund’s management fee (32 bps), stock selection/futures (+2 bps), securities lending (+2 bps), and dividend tax differential (+14 bps).
1 | Volatility is the measurement of the price movements of a group of stocks over a defined time frame. |
2 | The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index. |
3 | The MSCI All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by MSCI and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. |
4 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® Emerging | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Markets Quality Low Volatility Index Fund Ticker: QLVE
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | Fund Inception 7/15/2019 | |
| | | | |
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FlexShares Emerging Markets Quality Low Volatility Index Fund (Based on Net Asset Value) | | | 8.52 | % | | | -0.81 | % | | | -0.85 | % |
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FlexShares Emerging Markets Quality Low Volatility Index Fund (Based on Market Price) | | | 9.01 | % | | | -1.20 | % | | | -0.90 | % |
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MSCI Emerging Markets Index | | | 10.80 | % | | | -3.67 | % | | | -0.94 | % |
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Northern Trust Emerging Markets Quality Low Volatility IndexSM | | | 9.39 | % | | | 0.12 | % | | | -0.06 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.41% and the net expense ratio is 0.40%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Emerging Markets Quality Low Volatility IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower overall absolute volatility characteristics relative to a broad universe of securities domiciled in emerging market countries (the “Parent Index”). The Parent Index is a subset of the Northern Trust Global Index, limited to those securities domiciled in emerging markets and designated as large- and mid- capitalization companies by Northern Trust Investments, Inc. (“NTI”), acting in its capacity as the index provider. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which NTI believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2023, there were 163 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on emerging market equities generally traded higher. Over the course of the 12-month period, the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, emerging equities traded higher as China relaxed some pandemic-related restrictions, boosting investors’ expectations that increased spending could aid global growth, and that a global recession may be less severe than previously expected. Emerging market equity securities continued to rise in Q1 of 2023 but lagged
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FlexShares® Emerging | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Markets Quality Low Volatility Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
behind developed markets as continued monetary tightening across global central banks and increased U.S. and China geopolitical tensions weighed on the region. Emerging market equities continued higher in Q2 of 2023, but again trailed developed equity securities as optimism around China’s reopening was dampened by worse than expected consumer spending. Tensions between the U.S. and China increased as new restrictions around chip manufacturing in both the U.S. and Europe limited Chinese access to these technologies. Emerging equities declined in Q3 of 2023 as weakness in China’s property sector and overall economy negatively impacted global growth. We believe continued economic strength in the U.S. could result in global interest rates remaining at higher levels for longer than anticipated, also impinging on the growth outlook for emerging markets. Emerging markets continued lower in October of 2023 as slowing global growth, weak energy prices and increased geopolitical tensions weighed on markets.
Because emerging investments trended higher, and higher volatile securities outperformed less volatile securities during the 12 months ended October 31, 2023, we believe the low volatility1 approach was a negative driver of Fund performance for the 12-month period. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor2 companies, resulting in the highquality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the quality factor exposure was not enough to offset the negative performance of the low volatility factor, which was the primary source of the Underlying Index’s underperformance against the
MSCI Emerging Markets Index3 by -1.41%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -87 basis points (“bps”)4, which is reflective of the Fund’s management fee (-40 bps), stock selection/futures (-26 bps), India Capital Gains Taxes (-20 bps), and the compounding effect of tracking error over time (-1 bps).
1 | Volatility is the measurement of the price movements of a group of stocks over a defined time frame. |
2 | The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index. |
3 | The MSCI Emerging Markets Index is a selection of stocks that are designed to track the financial performance of key companies in fast-growing nations. |
4 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Market Factor Tilt Index Fund Ticker: TILT
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/16/2011 | |
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FlexShares Morningstar US Market Factor Tilt Index Fund (Based on Net Asset Value) | | | 5.67 | % | | | 9.09 | % | | | 9.27 | % | | | 11.56 | % |
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FlexShares Morningstar US Market Factor Tilt Index Fund (Based on Market Price) | | | 5.61 | % | | | 9.08 | % | | | 9.25 | % | | | 11.56 | % |
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Morningstar® U.S. Market Factor Tilt IndexSM | | | 5.83 | % | | | 9.24 | % | | | 9.42 | % | | | 11.72 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.25%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar® US Market Factor Tilt Index (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to size and value factors relative to the Morningstar US Market Index (the “Parent Index”), a float-adjusted market-capitalization weighted index of U.S.-incorporated large-, mid-, small- and micro- capitalization companies. The Underlying Index seeks to achieve increased exposures to size and value factors, or a “factor tilt,” by adjusting the Parent Index’s constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc. pursuant to its index methodology. The Underlying Index is designed to measure the performance of U.S. equity markets with increased exposure toward small-capitalization and value stocks. As of October 31, 2023, there were 2,373 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022, U.S. equity markets moved modestly lower as inflation remained elevated and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Market Factor Tilt Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
Gross Domestic Product (GDP)1 growth was more resilient than expected. The Fed continued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June meeting. Over the first six months of 2023 technology companies led all sectors, as artificial intelligence related companies drew interest with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023 as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023 as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
Because of the resiliency of the economic data, the falling inflation environment and the rising rate environment, U.S. domestic investments trended higher during the 12 months ended October 31, 2023; however, a large portion of the overall return for market weighted indices was concentrated in seven mega cap growth companies. We believe the value factor2 was a negative driver of Fund performance during the fiscal year ended October 31, 2023, as U.S. value stocks underperformed U.S. growth stocks3. The size factor4 was also impacted by the outsized performance of those mega cap growth companies that contributed outsized performance over the 12 months, resulting in size being a negative driver of Fund performance. Overall, the negative performance derived from both the value and size factors of the Underlying Index were the primary drivers behind the Underlying Index’s
underperformance against the Russell 3000 Index®5 by -2.55%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -16 basis points (“bps”)6, which is reflective of the management fee (-25 bps), stock selection/futures (+4 bps) and securities lending (+5 bps).
The Morningstar U.S. Market Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
2 | The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier. |
3 | Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market. |
4 | The Morningstar size factor measures a stock’s total capitalization, which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. |
5 | The Russell 3000 Index is a market-capitalization-weighted equity index that seeks to track 3000 of the largest U.S.-traded stocks. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Developed Markets ex-US Factor Tilt Index Fund Ticker: TLTD
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/25/2012 | |
| | | | |
| | | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (Based on Net Asset Value) | | | 13.21 | % | | | 3.24 | % | | | 2.74 | % | | | 4.48 | % |
| | | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (Based on Market Price) | | | 14.31 | % | | | 3.45 | % | | | 2.76 | % | | | 4.55 | % |
| | | | |
Morningstar® Developed Markets ex-US Factor Tilt IndexSM | | | 13.31 | % | | | 3.24 | % | | | 2.80 | % | | | 4.56 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.40% and the net expense ratio is 0.39%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar® Developed Markets ex-US Factor Tilt IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to size and value factors relative to the Morningstar Developed Markets ex-US Index (the “Parent Index”), a float adjusted market-capitalization weighted index of companies incorporated in Developed-market countries, excluding the U.S. The Underlying Index seeks to achieve increased exposures to size and value factors, or a “factor tilt”, by adjusting the Parent Index’s constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc. pursuant to its index methodology. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader developed international equity market by featuring size and value risk premiums, which Northern Trust Investments, Inc. (“NTI”) believes have been historically demonstrated over a full market cycle. As of October 31, 2023, there were 3,189 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on Developed international equity securities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, Developed international markets rose as falling inflation in Europe, a stabilized fiscal environment in the United Kingdom, and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. Developed international equities continued higher in Q1 of
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Developed Markets ex-US Factor Tilt Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
2023 as investors looked past concerns in the banking sector to falling energy prices, lower inflation in Europe, and strength in the technology and consumer discretionary sectors. Developed international equity securities continued higher in Q2 of 2023, but, in the aggregate, lagged U.S. equity markets as regional performance varied greatly between different markets. Japanese equity markets moved higher on the back of corporate governance reform, while Eurozone equities benefited from technology and semiconductor companies connected to artificial intelligence. Equity markets in the United Kingdom traded lower in local currency terms, but were positive in USD terms as falling energy prices and monetary tightening by the Bank of England impacted equities. Asia Pacific equity markets excluding Japan were lower, as concerns over growth in China due to weak consumer spending as well as increased geopolitical tensions between the U.S. and China impacted the region. Developed international equities declined in Q3 of 2023, as higher energy prices and concerns on consumer spending in China and Europe weighed on investors’ global growth outlook. Developed equities continued lower in October as slowing global growth and increased geopolitical tensions weighed on markets.
Because of the improved inflation outlook over the 12-month period, developed international investments trended higher during the 12 months ended October 31, 2023. We believe that the rising rate environment was beneficial to international value stocks relative to international growth stocks over the 12-month period and the value factor1 was a positive driver of Fund performance during the fiscal year ended October 31, 2023, as international value stocks outperformed international growth stocks2. The size
factor3, however, was a negative driver of Fund performance over the 12 months, as developed market small cap stocks underperformed developed market large cap stocks. Overall, the positive performance derived from the value factor exposures of the Underlying Index offset the negative performance of its size factor, leading to the Underlying Index’s outperformance against the MSCI World ex-USA IMI Index4 by 1.74%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -10 basis points (“bps”)5, which is reflective of the Fund’s management fee (-39 bps), securities lending (+9 bps) and dividend tax differential (+20 bps).
The Morningstar Developed Markets ex-US Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier. |
2 | Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market. |
3 | The Morningstar size factor measures a stock’s total capitalization, which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. |
4 | The MSCI World ex-USA Investable Market Index captures large, mid and small cap representation across 22 of 23 Developed Markets (DM) countries - excluding the U.S. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Emerging Markets Factor Tilt Index Fund Ticker: TLTE
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/25/2012 | |
| | | | |
| | | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (Based on Net Asset Value) | | | 13.63 | % | | | 2.51 | % | | | 1.42 | % | | | 1.80 | % |
| | | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (Based on Market Price) | | | 13.27 | % | | | 2.56 | % | | | 1.35 | % | | | 1.75 | % |
| | | | |
Morningstar® Emerging Markets Factor Tilt IndexSM | | | 14.59 | % | | | 3.36 | % | | | 2.15 | % | | | 2.57 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.60% and the net expense ratio is 0.59%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar® Emerging Markets Factor Tilt IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to size and value factors relative to the Morningstar Emerging Markets Index (the “Parent Index”), a float-adjusted market-capitalization weighted index of companies incorporated in emerging-market countries. The Underlying Index seeks to achieve increased exposures to size and value factors, or a “factor tilt,” by adjusting the Parent Index’s constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc., pursuant to its index methodology. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader emerging equity market by featuring size and value risk premiums, which Northern Trust Investments, Inc. (“NTI”) believes have been historically demonstrated over a full market cycle. As of October 31, 2023, there were 3,701 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund reserves the right to invest in substantially all of the securities in its Underlying Index in approximately the same proportions (i.e., replication) if NTI determines that it is in the best interest of the Fund.
During the 12 months ending October 31, 2023, prices on emerging market equities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD.
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Emerging Markets Factor Tilt Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
Through Q4 of 2022, emerging equities traded higher as China relaxed some pandemic-related restrictions, boosting investors’ expectations that increased spending could aid global growth, and that a global recession may be less severe than previously expected. Emerging market equity securities continued to rise in Q1 of 2023, but lagged behind Developed markets as continued monetary tightening across global central banks and increased U.S.China geopolitical tensions weighed on the region. Emerging market equities continued higher in Q2 of 2023, but again trailed Developed equity securities as optimism around China’s reopening was dampened by worse than expected consumer spending. Tensions between the U.S. and China increased as new restrictions around chip manufacturing in both the U.S. and Europe limited Chinese access to these technologies. Emerging equities declined in Q3 of 2023 as weakness in China’s property sector and overall economy negatively impacted global growth. We believe that continued economic strength in the U.S. could result in global interest rates remaining at higher levels for longer than anticipated, also impinging on the growth outlook for emerging markets. Emerging markets continued lower in October of 2023 as slowing global growth, weak energy prices, and increased geopolitical tensions weighed on markets.
Investors showed a preference for value companies in emerging markets for the 12 months ending October 31, 2023, resulting in the high value factor1 exposure being a positive driver of Fund performance as emerging market value stocks outperformed emerging market growth stocks.2 In addition, the size factor3 was a positive driver of Fund performance over the 12 months, as emerging market small cap stocks outperformed emerging market large cap stocks. Overall, the positive performance derived from the value and size factor exposures of the Underlying Index was the primary source of the Underlying Index’s outperformance against the MSCI Emerging Markets Investable Market Index (IMI)4 by 2.91%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was
-96 basis points (“bps”)5, which is reflective of the Fund’s management fee (-59 bps), stock selection/futures (-19 bps), securities lending (+6 bps) and dividend tax differential (+1 bps), and India Capital Gains Taxes (-25 bps).
The Morningstar Emerging Markets Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier. |
2 | Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market. |
3 | The Morningstar size factor measures a stock’s total capitalization, which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. |
4 | The MSCI Emerging Markets Investable Market Index (IMI) captures large, mid and small cap representation across 24 Emerging Markets (EM) countries. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Quality Large Cap Index Fund Ticker: QLC
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 9/23/2015 | |
| | | | |
| | | | |
FlexShares US Quality Large Cap Index Fund Index Fund (Based on Net Asset Value) | | | 9.54 | % | | | 10.93 | % | | | 8.56 | % | | | 9.71 | % |
| | | | |
FlexShares US Quality Large Cap Index Fund Index Fund (Based on Market Price) | | | 9.47 | % | | | 10.92 | % | | | 8.54 | % | | | 9.71 | % |
| | | | |
S&P 500 Index | | | 10.14 | % | | | 10.36 | % | | | 11.01 | % | | | 12.04 | % |
| | | | |
Northern Trust Quality Large Cap IndexSM | | | 9.89 | % | | | 11.31 | % | | | 8.84 | % | | | 10.04 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.25%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Quality Large Cap IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to quality, value and momentum factors relative to a universe of publicly traded U.S. large-capitalization equity securities. The universe is comprised of the 600 largest companies in the Northern Trust 1250 Index, a floatadjusted market-capitalization weighted index of U.S. domiciled companies. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader U.S. large-cap equity market by featuring quality, value and momentum risk premiums, which Northern Trust Investments, Inc. (“NTI”) believes have been historically demonstrated over a full market cycle. As of October 31, 2023, there were 183 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022, U.S. equity markets moved modestly lower as inflation remained elevated and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)1 growth was more resilient than expected. The Fed continued to hike interest rates through May 2023, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June 2023 meeting. Over the first six months of 2023, technology
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Quality Large Cap Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023 as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023 as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
Because of the resiliency of the economic data, the falling inflation environment and the rising rate environment, U.S. domestic investments trended higher during the 12 months ended October 31, 2023; however, a large portion of the overall return for market weighted indices was concentrated in seven mega cap2 growth companies. Because of the outsized performance of these large cap growth names, we believe the value factor3 was a negative driver of Fund performance during the fiscal year ended October 31, 2023, as U.S. value stocks underperformed U.S. growth stocks4. We believe that investors showed a preference for high quality factor5 companies within the large cap universe utilized by the Underlying Index, resulting in the high-quality factor exposure enhancing Fund performance over the 12 months. The momentum factor exposure6 of the Underlying Index was also a positive driver of Fund performance as positive momentum companies outperformed negative momentum companies over the 12 months. Overall, the positive performance from the quality and momentum exposures of the Underlying Index was not enough to offset the negative performance of the value factor of the Underlying Index,
and this was the primary source of the Underlying Index’s underperformance relative to the S&P 500 Index7 by -25 basis points (“bps”)8. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -35 bps which is reflective of the management fee (-25 bps), stock selection/futures (-10 bps), securities lending (+1 bps) and performance calculation differences between the Underlying Index and the Fund (-1 bps).
1 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
2 | Size is measured by a stock’s total capitalization which can be found by multiplying the current share price by all the outstanding shares of stock. |
3 | The value factor is a factor reflecting the current worth of a company relative to its own historical value, book value, or valuation versus peers. |
4 | Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market. |
5 | The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the market. |
6 | The momentum factor is a factor that reflects market sentiment and changes in security price over a given time period. |
7 | The Standard & Poor’s 500 Index is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S. |
8 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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16 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
STOXX US ESG Select Index Fund Ticker: ESG
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 7/13/2016 | |
| | | | |
| | | | |
FlexShares STOXX® US ESG Select Index Fund (Based on Net Asset Value) | | | 11.91 | % | | | 10.43 | % | | | 11.37 | % | | | 12.01 | % |
| | | | |
FlexShares STOXX® US ESG Select Index Fund (Based on Market Price) | | | 11.87 | % | | | 10.41 | % | | | 11.38 | % | | | 12.01 | % |
| | | | |
Russell 1000® Index | | | 9.48 | % | | | 9.52 | % | | | 10.71 | % | | | 11.31 | % |
| | | | |
STOXX® USA ESG Select KPIs IndexSM | | | 11.83 | % | | | 10.33 | % | | | 11.15 | % | | | 11.57 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.33% and the net expense ratio is 0.32%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX® USA ESG Select KPIs IndexSM (“Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, score better with respect to a set of environmental, social and governance (“ESG”) key performance indicators relative to the U.S. companies in the STOXX® Global 1800 Index, a float adjusted market-capitalization weighted index of companies incorporated in the U.S. and in developed international markets. As of October 31, 2023, there were 263 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022, U.S. equity markets moved modestly lower as inflation remained elevated, and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)1 growth was more resilient than expected. The Fed continued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June meeting. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in
1 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
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| | FLEXSHARES ANNUAL REPORT | | | 17 | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
STOXX US ESG Select Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
Q3 of 2023 as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023 as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
The Underlying Index had a positive total return during the 12 months ended October 31, 2023, and outperformed domestic equity markets, as defined by the Russell 1000® Index2 by 2.35%. The Underlying Index’s ESG-tilted approach led to underweight Fund exposure to the utilities, real estate and industrials sectors, which benefited Fund performance. Likewise, the ESG tilt led to differences in security weights within the communication services, financials and health care sectors that were also positive drivers of Fund performance. Overall, the only sector within the Underlying Index that contributed negatively to relative performance was the energy sector.
Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was +8 basis points (“bps”)3, which is reflective of the management fee (-32 bps), stock selection/futures (-7 bps) and dividend tax differential (+47 bps). The STOXX USA ESG Select KPIs Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.
2 | The Russell 1000® Index refers to a stock market index that represents the 1000 top companies in the United States. |
3 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
STOXX® Global ESG Select Index Fund Ticker: ESGG
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
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| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 7/13/2016 | |
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FlexShares STOXX® Global ESG Select Index Fund (Based on Net Asset Value) | | | 14.17 | % | | | 9.38 | % | | | 9.50 | % | | | 10.00 | % |
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FlexShares STOXX® Global ESG Select Index Fund (Based on Market Price) | | | 14.52 | % | | | 9.33 | % | | | 9.46 | % | | | 10.04 | % |
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MSCI World Index | | | 10.48 | % | | | 8.14 | % | | | 8.27 | % | | | 8.82 | % |
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STOXX® Global ESG Select KPIs IndexSM | | | 14.30 | % | | | 9.47 | % | | | 9.56 | % | | | 10.03 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.43% and the net expense ratio is 0.42%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX® Global ESG Select KPIs IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, score better with respect to a set of environmental, social and governance (“ESG”) key performance indicators relative to the STOXX® Global 1800 Index, a float-adjusted market-capitalization weighted index of companies incorporated in the U.S. and in developed international markets. As of October 31, 2023, there were 865 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on global equity securities generally traded higher. Through Q4 of 2022 global markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity securities prices. Global equities continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation, and global growth was more resilient than expected. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven U.S. large cap growth companies contributing a large portion of equity market gains. Global equities declined in Q3 of 2023 as higher energy prices, consumer spending concerns in China, and the U.S. Federal Reserve’s outlook of “higher rates for longer” weighed on investors’ global growth outlook. Global equities continued lower in October of 2023 as slowing global growth concerns and increased geopolitical tensions weighed on markets.
The Underlying Index had a positive total return during the 12 months ended
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
STOXX® Global ESG Select Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
October 31, 2023, and outperformed global equity markets, as defined by the MSCI World Index1, by 3.82%. The Underlying Index’s ESG-tilted approach led to underweights to the utilities and real estate sectors as well as overweights to the technology and energy sectors that benefited Fund performance. The ESG tilt also led to overweights to the healthcare and energy sectors as well as an underweight to the communication services sector that detracted from performance. Likewise, the ESG tilt led to differences in security weights within the communication services, financials and industrials sectors that were positive drivers of Fund performance as well as security selections within the technology and energy sectors that detracted from performance. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -13 basis points (“bps”)2, which is reflective of the management fee (-42 bps), stock selection/futures (-10 bps), securities lending (+1 bps), and dividend tax differential (+38 bps).
The STOXX Global ESG Select KPIs Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | The MSCI World Index captures large and mid-cap representation across 23 Developed Markets countries. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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20 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Large Cap Core Index Fund Ticker: FEUS
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
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| | 1 Year | | | Fund Inception 9/20/2021 | |
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FlexShares ESG & Climate US Large Cap Core Index Fund (Based on Net Asset Value) | | | 9.33 | % | | | -0.97 | % |
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FlexShares ESG & Climate US Large Cap Core Index Fund (Based on Market Price) | | | 9.29 | % | | | -0.99 | % |
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S&P 500 Index | | | 10.14 | % | | | -0.23 | % |
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Northern Trust ESG & Climate US Large Cap Core IndexSM | | | 9.47 | % | | | -0.88 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.10% and the net expense ratio is 0.09%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate US Large Cap Core IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance (“ESG”) characteristics, while also seeking to provide broad-market, core exposure to publicly traded U.S. large capitalization equity securities, i.e., the 600 largest companies in the Northern Trust 1250 IndexSM (the “Starting Universe”), as measured by largest float adjusted market capitalization. The Underlying Index is designed to minimize tracking differences relative to the Starting Universe, while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Starting Universe. As of October 31, 2023, there were 166 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022 U.S. equity markets moved modestly lower as inflation remained elevated, and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)1 growth was more resilient than expected. The Fed con-
1 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Large Cap Core Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
tinued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June meeting. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023, as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023, as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
The Underlying Index had a positive total return during the 12 months ended October 31, 2023, and underperformed the U.S. large cap equity market, as defined by the S&P 500 Index2 by -0.67%. The Underlying Index’s Climate and ESG focused approach led to differences in security weights within the healthcare, industrials, communication services and consumer staples sectors that negatively impacted performance. Overall, it was the differences in these sectors that were the primary source of the Underlying Index’s underperformance. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was - 14 basis point (“bps”)3, which is reflective of the management fee (-9 bps), stock selection/futures (-4 bps), and compounding of tracking error over time (-1 bps).
2 | The S&P 500 Index is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S. |
3 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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22 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Developed Markets ex-US Core Index Fund Ticker: FEDM
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
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| | 1 Year | | | Fund Inception 9/20/2021 | |
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FlexShares ESG & Climate Developed Markets Ex-US Core Index Fund (Based on Net Asset Value) | | | 12.08 | % | | | -5.90 | % |
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FlexShares ESG & Climate Developed Markets Ex-US Core Index Fund (Based on Market Price) | | | 12.80 | % | | | -5.49 | % |
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MSCI World ex-US Index | | | 12.56 | % | | | -5.22 | % |
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Northern Trust ESG & Climate Developed Markets ex-US Core IndexSM | | | 12.21 | % | | | -5.93 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.13% and the net expense ratio is 0.12%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Developed Markets ex-US Core IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance (“ESG”) characteristics, while also seeking to provide broad-market, core exposure to publicly traded equity securities issued by companies domiciled in developed market countries, excluding the U.S. The Underlying Index is designed to minimize tracking differences relative to the Northern Trust Developed Markets ex-US Large Cap IndexSM (the “Parent Index”), while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2023, there were 281 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on developed international equity securities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, developed international markets rose as falling inflation in Europe, a stabilized fiscal environment in the United Kingdom, and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. Developed international equities continued higher in Q1 of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation in Europe,
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Developed Markets ex-US Core Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
and strength in the technology and consumer discretionary sectors. Developed international equity securities continued higher in Q2 of 2023, but, in the aggregate, lagged U.S. equity markets as regional performance varied greatly between different markets. Japanese equity markets moved higher on the back of corporate governance reform, while Eurozone equities benefited from technology and semiconductor companies connected to artificial intelligence. Equity markets in the United Kingdom traded lower in local currency terms, but were positive in USD terms as falling energy prices and monetary tightening by the Bank of England impacted equities. Asia Pacific equity markets excluding Japan were lower as concerns over growth in China due to weak consumer spending, as well as increased geopolitical tensions between the U.S. and China impact the region. Developed international equities declined in Q3 of 2023, as higher energy prices and concerns on consumer spending in China and Europe weighed on investors’ global growth outlook. Developed equities continued lower in October of 2023 as slowing global growth and increased geopolitical tensions weighed on markets.
The Underlying Index had a positive total return during the 12 months ended October 31, 2023, and underperformed the developed international equity market, as defined by the MSCI World ex-US Index1 by -0.35%. The Underlying Index’s Climate and ESG focused approach led to differences in security weights within the utilities, financials and consumer discretionary sectors that negatively impacted performance. Overall, it was the differences in these sectors that were the primary source of the Underlying Index’s underperformance. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -13 basis points (“bps”)2, which is reflective of the management fee (-12 bps), stock selection/futures (-5 bps), and dividend tax differential (+4 bps).
1 | The MSCI World ex USA Index captures large and mid cap representation across 22 of 23 Developed Markets (DM) countries – excluding the United States. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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24 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Emerging Markets Core Index Fund Ticker: FEEM
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
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| | 1 Year | | | Fund Inception 4/20/2022 | |
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FlexShares ESG & Climate Emerging Markets Core Index Fund (Based on Net Asset Value) | | | 11.14 | % | | | -8.50 | % |
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FlexShares ESG & Climate Emerging Markets Core Index Fund (Based on Market Price) | | | 10.98 | % | | | -8.23 | % |
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MSCI Emerging Markets Index | | | 10.80 | % | | | -8.38 | % |
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Northern Trust ESG & Climate Emerging Markets Core IndexSM | | | 11.79 | % | | | -8.30 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Emerging Markets Core IndexSM (the “Underlying Index”) The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance (“ESG”) characteristics, while also seeking to provide broad-market, core exposure to publicly traded equity securities issued by companies domiciled in emerging market countries. The Underlying Index is designed to minimize tracking differences relative to the Northern Trust Emerging Markets Large Cap IndexSM (the “Parent Index”), while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2023, there were 265 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on emerging market equities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, emerging equities traded higher as China relaxed some pandemic-related restrictions, boosting investors’ expectations that increased spending could aid global growth, and that a global recession may be less severe than previously expected. Emerging market equity securities continued to rise in Q1 of 2023, but lagged behind developed markets as continued monetary tightening across global central banks and increased U.S.China geopolitical
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FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Emerging Markets Core Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
tensions weighed on the region. Emerging market equities continued higher in Q2 of 2023, but again trailed developed equity securities as optimism around China’s reopening was dampened by worse than expected consumer spending. Tensions between the U.S. and China increased as new restrictions around chip manufacturing in both the U.S. and Europe limited Chinese access to these technologies. Emerging equities declined in Q3 of 2023, as weakness in China’s property sector and overall economy negatively impacted global growth. We believe continued economic strength in the U.S. could result in global interest rates remaining at higher levels for longer than anticipated, also impinging on the growth outlook for emerging markets. Emerging markets continued lower in October of 2023 as slowing global growth, weak energy prices and increased geopolitical tensions weighed on markets.
The Underlying Index had a positive total return during the 12 months ended October 31, 2023, and outperformed the emerging equity market, as defined by the MSCI Emerging Markets Index1 by 0.99% The Underlying Index’s Climate and ESG focused approach led to differences in security weights within the financials, consumer discretionary and materials sectors that positively impacted performance. Overall, it was the differences in these sectors that were the primary source of the Underlying Index’s outperformance. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -65 basis points (“bps”)2, which is reflective of the management fee (-18 bps), stock selection/futures (-45 bps), dividend tax differential (-1 bps), and India Capital Gains Taxes (-1 bps).
1 | The MSCI Emerging Markets Index is a selection of stocks that are designed to track the financial performance of key companies in fast-growing nations. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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26 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Upstream Natural Resources Index Fund Ticker: GUNR
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
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| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/16/2011 | |
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FlexShares Morningstar Global Upstream Natural Resources Index Fund (Based on Net Asset Value) | | | -3.92 | % | | | 7.97 | % | | | 4.50 | % | | | 3.73 | % |
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FlexShares Morningstar Global Upstream Natural Resources Index Fund (Based on Market Price) | | | -3.96 | % | | | 7.99 | % | | | 4.49 | % | | | 3.74 | % |
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Morningstar® Global Upstream Natural Resources IndexSM | | | -3.32 | % | | | 8.57 | % | | | 5.02 | % | | | 4.18 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.47% and the net expense ratio is 0.46%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar Global Upstream Natural Resources IndexSM (the “Underlying Index”). The Underlying Index reflects the performance of a selection of equity securities that are traded in or are issued by companies classified as developed or emerging markets (including the U.S.), as determined by Morningstar, Inc., the index provider, pursuant to its index methodology. To be eligible for inclusion in the Underlying Index, a security must be issued by a company that has significant economic interests in one of the following natural resource categories: energy, agriculture, precious or industrial metals, timber or water, as determined by the Index Provider pursuant to its index methodology (collectively, the “Natural Resources sector”). As of October 31, 2023, there were 120 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective and a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on global equity securities generally traded higher. Through Q4 of 2022 global markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. Global equities continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation and global growth was more resilient than expected. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven U.S. large cap growth companies contributing a large portion of equity market gains. Global equities declined in Q3 of 2023 as higher energy prices, consumer spending concerns in China, and the U.S. Federal Reserve’s outlook of “higher rates for longer” weighed on
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| | FLEXSHARES ANNUAL REPORT | | | 27 | |
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FlexShares® Morningstar® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Upstream Natural Resources Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
investors’ global growth outlook. Global equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
For the 12-month period ended October 31, 2023, the Underlying Index underperformed the global natural resource equity markets, as defined by the S&P Global Natural Resources Index1, by -4.28%. Due to the Underlying Index’s focus on the upstream section of the natural resource supply chain, security selection in Energy and Metals detracted from performance. Sector allocation within Agriculture and Metals also detracted from performance versus the benchmark. The Water Resources sector was a drag on performance, as higher interest rates negatively impacted returns due to the capital intensive nature of the sector. Relative performance in Timber did not aid or detract from the Underlying Index’s relative performance, as negative performance attributed to allocation was offset by positive security selection within the sector. Tracking difference for the period between the Fund’s NAV and the Underlying Index was -60 basis points (bps)2, which is reflective of the Fund’s management fee (-46 bps), stock selection/futures (-20 bps), securities lending (+3 bps), and dividend tax differential (+3 bps).
The Morningstar Global Upstream Natural Resources Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | The S&P Global Natural Resources Index includes 90 of the largest publicly-traded companies in natural resources and commodities businesses that meet specific investability requirements, offering investors diversified and investable equity exposure across 3 primary commodityrelated sectors: agribusiness, energy, and metals & mining. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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28 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® STOXX | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Broad Infrastructure Index Fund Ticker: NFRA
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 10/8/2013 | |
| | | | |
| | | | |
FlexShares STOXX® Global Broad Infrastructure Index Fund (Based on Net Asset Value) | | | 1.24 | % | | | 3.71 | % | | | 4.05 | % | | | 4.44 | % |
| | | | |
FlexShares STOXX® Global Broad Infrastructure Index Fund (Based on Market Price) | | | 1.41 | % | | | 3.84 | % | | | 4.06 | % | | | 4.46 | % |
| | | | |
STOXX® Global Broad Infrastructure Index | | | 1.10 | % | | | 3.59 | % | | | 3.95 | % | | | 4.34 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX® Global Broad Infrastructure Index (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, offer broad exposure to publicly traded developed- and emerging-market infrastructure companies, including U.S. companies, as defined by STOXX Ltd. (“STOXX”) pursuant to its index methodology. As of October 31, 2023, there were 172 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on global equity securities generally traded higher. Through Q4 of 2022 global markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. Global equities continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation and global growth was more resilient than expected. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven U.S. large cap growth companies contributing a large portion of equity market gains. Global equities declined in Q3 of 2023, as higher energy prices, consumer spending concerns in China, and the U.S. Federal Reserve’s outlook of “higher rates for longer” weighed on investors’ global growth outlook. Global equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
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FlexShares® STOXX | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Broad Infrastructure Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
The Underlying Index had a positive total return during the 12 months ended October 31, 2023, and outperformed the global infrastructure market, as defined by the S&P Global Infrastructure Index1, by 3.33%. The Underlying Index’s exposures to the communication, energy, utilities and social infrastructure sectors positively benefited Fund performance, while exposure to transportation infrastructure negatively contributed to Fund performance. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was +14 basis points (“bps”)2, which is reflective of the Fund’s management fee (-47 bps), stock selection/futures (+2 bps), securities lending (+4 bps), dividend tax differential (+54 bps), and India Capital Gain taxes (+1 bps).
The STOXX Global Infrastructure Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.
1 | The S&P Global Infrastructure Index is designed to track 75 companies from around the world chosen to represent the listed infrastructure industry while maintaining liquidity and tradability. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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30 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Quality Real Estate Index Fund Ticker: GQRE
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 11/5/2013 | |
| | | | |
| | | | |
FlexShares Global Quality Real Estate Index Fund (Based on Net Asset Value) | | | -7.16 | % | | | -0.05 | % | | | -1.19 | % | | | 2.23 | % |
| | | | |
FlexShares Global Quality Real Estate Index Fund (Based on Market Price) | | | -6.84 | % | | | 0.02 | % | | | -1.13 | % | | | 2.25 | % |
| | | | |
FTSE EPRA/NAREIT Developed IndexSM | | | -6.03 | % | | | 0.08 | % | | | -1.46 | % | | | 1.34 | % |
| | | | |
Northern Trust Global Quality Real Estate IndexSM | | | -7.38 | % | | | -0.34 | % | | | -1.37 | % | | | 2.11 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.46% and the net expense ratio is 0.45%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Global Quality Real Estate IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to quality, value and momentum factors relative to the Northern Trust Global Real Estate Index (the “Parent Index”), a float-adjusted market-capitalization weighted index of publicly traded equity securities of U.S. and non-U.S. real estate investment trusts (“REITs”) and real estate operating companies. In addition, the Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the global publicly traded real-estate market by featuring quality, value and momentum risk premiums, which Northern Trust Investments, Inc. (“NTI”) believes have been historically demonstrated over a full market cycle. As of October 31, 2023, there were 137 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on global equity securities generally traded higher. Through Q4 of 2022 global markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. Global equities continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation, and global growth was more resilient than expected. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven U.S. large cap growth companies contributing a large portion of equity market gains. Global equities declined in Q3 of 2023, as higher energy prices, consumer spending concerns in
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Global Quality Real Estate Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
China, and the U.S. Federal Reserve’s outlook of “higher rates for longer” weighed on investors’ global growth outlook. Global equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
The Underlying Index had a negative total return during the 12 months ended October 31, 2023, and underperformed the global equity real estate markets, as defined by the FTSE EPRA/NAREIT Developed Net Index1, by -1.35%. The value2 and quality3 factor exposures of the Underlying Index were negative drivers of Fund performance, while the momentum4 factor exposure was a positive driver of Fund performance. Overall, the positive exposure to momentum was not enough to offset the headwinds from the negative performance derived from the value and quality exposures. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was +22 basis points (“bps”)5, which is reflective of the Fund’s management fee (-45 bps), stock selection/futures (+8 bps), securities lending (+2 bps), dividend tax differential (+58 bps), and compounding of tracking error over time (-1 bps).
1 | The FTSE EPRA/NAREIT Developed Net Index is an index designed to track the performance of listed real estate companies in both developed and emerging countries worldwide. |
2 | The value factor is a factor reflecting the current worth of a company relative to its own historical value, book value or valuation versus peers. |
3 | The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index. |
4 | The momentum factor is a factor that reflects market sentiment and changes in a security price over a given time period. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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32 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Real Assets Allocation Index Fund Ticker: ASET
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 11/23/2015 | |
| | | | |
| | | | |
FlexShares Real Assets Allocation Index Fund (Based on Net Asset Value) | | | -1.78 | % | | | 5.14 | % | | | 3.67 | % | | | 4.15 | % |
| | | | |
FlexShares Real Assets Allocation Index Fund (Based on Market Price) | | | -1.99 | % | | | 5.09 | % | | | 3.63 | % | | | 4.13 | % |
| | | | |
MSCI ACWI Index | | | 10.50 | % | | | 6.68 | % | | | 7.48 | % | | | 7.69 | % |
| | | | |
Northern Trust Real Assets Allocation IndexSM | | | -1.69 | % | | | 5.27 | % | | | 3.80 | % | | | 4.27 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. Prior to September 1, 2023, the gross expense ratio of the Fund was 1.04% and the net expense ratio was 0.57%. Effective September 1, 2023, the gross expense ratio of the Fund is 0.96% and the net expense ratio is 0.49%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Real Assets Allocation IndexSM (the “Underlying Index”). The Fund is a fund of funds and seeks to achieve its investment objective by investing primarily in the shares of other FlexShares ETFs (each an “Underlying Fund,” and together, the “Underlying Funds”) that are eligible for inclusion in the Underlying Index, rather than in securities of individual companies. The Underlying Funds themselves seek investment results corresponding to their own respective underlying indexes. The Underlying Funds invest primarily in separate sets of securities representing or providing exposures to global “real assets.” Real assets are defined by the index provider as physical or tangible assets. Examples of real assets include but are not limited to commodities, precious metals, oil, and real estate. Each Underlying Fund has its own risk profile and will contribute differently to the overall risk profile of the Fund. Each of the Underlying Funds invests in equity securities that are traded in or are issued by companies domiciled in global developed or emerging markets (including the U.S.). Certain of the Underlying Funds may invest in publicly traded units of master limited partnerships and real estate investment trusts. As of October 31, 2023, there were three Underlying Funds in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. “Representative sampling” means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on global equity securities generally traded higher. Through Q4 of 2022 global markets rose as falling inflation and the anticipated boost to global growth
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| | FLEXSHARES ANNUAL REPORT | | | 33 | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Real Assets Allocation Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
resulting from the re-opening of China’s economy all supported equity security prices. Global equities continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation and global growth was more resilient than expected. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven U.S. large cap growth companies contributing a large portion of equity market gains. Global equities declined in Q3 of 2023, as higher energy prices, consumer spending concerns in China, and the U.S. Federal Reserve’s outlook of “higher rates for longer” weighed on investors’ global growth outlook. Global equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
The Underlying Index had a negative total return during the 12 months ended October 31, 2023, underperforming global equity markets, as defined by the MSCI All Country World Index (ACWI)1 by -12.19%. All three asset classes within reals assets underperformed global equities. Global real estate and natural resources had negative performance over the 12-month period as rising global interest rates and falling energy prices negatively impacted each asset class, respectively. Infrastructure delivered positive performance for the 12-month period, but still trailed global equities as it was also negatively impacted by the rising rate environment. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was -9 basis points (“bps”)2, which is largely reflective of the Fund’s management fee (-57 bps), a reimbursement amount equal to the Acquired Fund Fees and Expenses attributable to the Fund’s investments in the Underlying Funds (+47 bps) and performance calculation differences between the Underlying Index and the Fund (+1 bp).
1 | The MSCI All Country World Index is a market-capitalization-weighted index maintained by MSCI and is designed to provide a broad measure of stock performance throughout the world. |
2 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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34 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Index Fund Ticker: QDF
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 12/14/2012 | |
| | | | |
| | | | |
FlexShares Quality Dividend Index Fund (Based on Net Asset Value) | | | 6.52 | % | | | 7.13 | % | | | 8.49 | % | | | 10.46 | % |
| | | | |
FlexShares Quality Dividend Index Fund (Based on Market Price) | | | 6.50 | % | | | 7.13 | % | | | 8.48 | % | | | 10.46 | % |
| | | | |
Russell 1000® Index | | | 9.48 | % | | | 10.71 | % | | | 10.88 | % | | | 12.44 | % |
| | | | |
Northern Trust Quality Dividend IndexSM | | | 6.96 | % | | | 7.71 | % | | | 9.00 | % | | | 10.98 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust Quality Dividend IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, provide exposure to a high-quality income-oriented universe of long-only U.S. equity securities, with an emphasis on long-term capital growth and a targeted overall beta1 that is similar to that of the Northern Trust 1250 Index2. As of October 31, 2023, there were 138 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022 U.S. equity markets moved modestly lower as inflation remained elevated, and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)3 growth was
1 | A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor’s (“S&P”) 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. |
2 | Northern Trust 1250 Index is a float-adjusted market-capitalization weighted index comprised of U.S. domiciled large- and mid-capitalization companies. |
3 | 9 GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
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| | FLEXSHARES ANNUAL REPORT | | | 35 | |
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FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Index Fund (cont.)
PORTFOLIO ANALYSIS(cont.)
more resilient than expected. The Fed continued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June meeting. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023, as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023, as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
Because of the resiliency of the economic data, the falling inflation environment, and the rising rate environment, U.S. domestic investments trended higher during the 12 months ended October 31, 2023; however, a large portion of the overall return for market weighted indices was concentrated in seven mega cap growth companies4. We believe the dividend yield factor5 was a negative driver of Fund performance as higher yielding investments underperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor6 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the quality factor exposure was not enough to offset the negative performance from the dividend yield factor of the Underlying Index and was the primary source of the Underlying Index’s underperformance against the Russell 1000® Index7 by
-2.52%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -44 basis points (“bps”)8, which is reflective of the management fee (-37 bps), stock selection/futures (-8 bps), securities lending (+6 bps), and dividend tax differential (-5 bps).
4 | Size is measured by a stock’s total capitalization which can be found by multiplying the current share price by all the outstanding shares of stock. |
5 | Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index. |
6 | The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market. |
7 | The Russell 1000® Index refers to a stock market index that represents the 1000 top companies in the United States. |
8 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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36 | | FLEXSHARES ANNUAL REPORT | | |
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FlexShares® Quality | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Dividend Defensive Index Fund Ticker: QDEF
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 12/14/2012 | |
| | | | |
| | | | |
FlexShares Quality Dividend Defensive Index Fund (Based on Net Asset Value) | | | 7.82 | % | | | 7.34 | % | | | 8.80 | % | | | 10.50 | % |
| | | | |
FlexShares Quality Dividend Defensive Index Fund (Based on Market Price) | | | 7.74 | % | | | 7.33 | % | | | 8.77 | % | | | 10.50 | % |
| | | | |
Russell 1000® Index | | | 9.48 | % | | | 10.71 | % | | | 10.88 | % | | | 12.44 | % |
| | | | |
Northern Trust Quality Dividend Defensive IndexSM | | | 8.20 | % | | | 7.79 | % | | | 9.35 | % | | | 11.04 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust Quality Dividend Defensive IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, provide exposure to a high-quality income-oriented universe of long-only U.S. equity securities, with an emphasis on long-term capital growth and a targeted overall beta1 that is generally between 0.5 to 1.0 times that of the Northern Trust 1250 Index2. As of October 31, 2023, there were 127 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on domestic equity securities generally traded higher. Through Q4 of 2022 U.S. equity markets moved modestly lower as inflation remained elevated, and the U.S. Federal Reserve (the “Fed”) continued to tighten monetary conditions through rate hikes. U.S. equities rose over the first half of 2023, as investors looked past the collapse of Silicon Valley Bank and the potential of a banking crisis, as inflation declined while Gross Domestic Product (GDP)3 growth was
1 | A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the S&P 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. |
2 | Northern Trust 1250 Index is a float-adjusted market-capitalization weighted index comprised of U.S. domiciled large- and mid-capitalization companies. |
3 | GDP is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States. |
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| | FLEXSHARES ANNUAL REPORT | | | 37 | |
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FlexShares® Quality | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Dividend Defensive Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
more resilient than expected. The Fed continued to hike interest rates through the first three meetings of the year, but lowered the magnitude of those hikes to one-quarter percent each before pausing at the June meeting. Over the first six months of 2023, technology companies led all sectors as artificial intelligence related companies drew interest, with seven large cap growth companies contributing a large portion of equity market gains. Domestic equity securities declined in Q3 of 2023, as inflation increased in July and August of 2023, and the Fed reiterated their outlook of “higher rates for longer” than we believe markets had priced in at the beginning of Q3 of 2023. U.S. equity markets continued to decline in October of 2023, as inflation remained resilient and there were increased concerns of slowing global growth due to weakness in China’s economy.
Because of the resiliency of the economic data, the falling inflation environment, and the rising rate environment, U.S. domestic investments trended higher during the 12 months ended October 31, 2023; however, a large portion of the overall return for market weighted indices was concentrated in seven mega cap growth companies4. We believe the dividend yield factor5 was a negative driver of Fund performance as higher yielding investments underperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor6 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Though equity markets were generally higher over the full 12-month period, there were several downturns within the year, and we believe the lower beta exposure benefited the Underlying Index. Overall, the positive performance derived from the quality factor exposure was not enough to offset the negative performance from the dividend yield factor of the Underlying Index, and was the primary source of the Underlying Index’s underperformance against the Russell 1000® Index7 by -1.28%.
Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12month period was -38 basis points (“bps”)8, which is reflective of the management fee (-37 bps), stock selection/futures (-3 bps), securities lending (+6 bps), dividend tax differential (-4 bps).
4 | Size is measured by a stock’s total capitalization which can be found by multiplying the current share price by all the outstanding shares of stock. |
5 | Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index. |
6 | The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market. |
7 | The Russell 1000® Index refers to a stock market index that represents the 1000 top companies in the United States. |
8 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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38 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Index Fund Ticker: IQDF
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 4/12/2013 | |
| | | | |
| | | | |
FlexShares International Quality Dividend Index Fund (Based on Net Asset Value) | | | 17.45 | % | | | 3.10 | % | | | 1.67 | % | | | 4.44 | % |
| | | | |
FlexShares International Quality Dividend Index Fund (Based on Market Price) | | | 17.92 | % | | | 3.27 | % | | | 1.66 | % | | | 4.44 | % |
| | | | |
MSCI AC World ex USA Index | | | 12.07 | % | | | 3.46 | % | | | 2.54 | % | | | 3.27 | % |
| | | | |
Northern Trust International Quality Dividend IndexSM | | | 18.24 | % | | | 3.40 | % | | | 2.02 | % | | | 2.79 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, provide exposure to a high-quality income-oriented universe of long-only international securities issued by non-U.S. based companies, with an emphasis on long-term capital growth and a targeted overall beta1 that is similar to that of the Northern Trust International Large Cap Index2. As of October 31, 2023, there were 191 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on international equity securities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, international markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. International equities continued higher over the first half of 2023, as investors looked past concerns in the
1 | A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the S&P 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. |
2 | Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large-and mid-capitalization companies. |
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| | FLEXSHARES ANNUAL REPORT | | | 39 | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
banking sector to falling energy prices, lower inflation, and strength in the technology and consumer discretionary sectors. International equities declined in Q3 of 2023, as higher energy prices and consumer spending concerns in China and Europe weighed on investors’ global growth outlook. International equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
Because of the improved inflation outlook over the 12-month period, developed international investments trended higher during the 12 months ended October 31, 2023, and we believe the dividend yield factor3 was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor4 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the dividend and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index’s outperformance against the MSCI All Country World Index Ex-U.S. Index5 by 6.17%. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -79 basis points (“bps”)6, which is reflective of the Fund’s management fee (-47 bps), stock selection/futures (-16 bps), securities lending (+5 bps), India Capital Gains Taxes (-20 bps), and compounding of tracking error over time (-1 bps).
3 | Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index. |
4 | The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market. |
5 | The MSCI All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by MSCI and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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40 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Defensive Index Fund Ticker: IQDE
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 4/12/2013 | |
| | | | |
| | | | |
FlexShares International Quality Dividend Defensive Index Fund (Based on Net Asset Value) | | | 12.54 | % | | | 2.10 | % | | | 0.89 | % | | | 1.60 | % |
| | | | |
FlexShares International Quality Dividend Defensive Index Fund (Based on Market Price) | | | 13.05 | % | | | 2.22 | % | | | 0.84 | % | | | 1.61 | % |
| | | | |
MSCI AC World ex USA Index | | | 12.07 | % | | | 3.46 | % | | | 2.54 | % | | | 3.27 | % |
| | | | |
Northern Trust International Quality Dividend Defensive IndexSM | | | 13.27 | % | | | 2.46 | % | | | 1.40 | % | | | 2.09 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend Defensive IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, provide exposure to a high-quality income-oriented universe of long-only international securities issued by non-U.S. based companies, with an emphasis on long-term capital growth and a targeted overall beta1 that is generally between 0.5 to 1.0 times that of the Northern Trust International Large Cap Index2. As of October 31, 2023, there were 197 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on international equity securities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, international markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. International equities
1 | A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the S&P 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. |
2 | Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large- and mid-capitalization companies. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 41 | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Defensive Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation, and strength in the technology and consumer discretionary sectors. International equities declined in Q3 of 2023, as higher energy prices and consumer spending concerns in China and Europe weighed on investors’ global growth outlook. International equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
Because of the improved inflation outlook over the 12-month period, developed international investments trended higher during the 12 months ended October 31, 2023, and we believe the dividend yield factor3 was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor4 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Because international equities moved higher over the 12 months, we believe that the low beta exposure detracted from Fund performance. Overall, the positive performance derived from the dividend and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index’s outperformance against the MSCI All Country World Index Ex-U.S. Index5 by 1.20%.Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -73 basis points (“bps”)6, which is reflective of the Fund’s
management fee (-47 bps), stock selection/futures (-29 bps), securities lending (+5 bps), India Cap Gain Tax (-1 bps) and compounding of tracking error over time (-1 bps).
3 | Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index. |
4 | The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market. |
5 | The MSCI All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by MSCI and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
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42 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Dynamic Index Fund Ticker: IQDY
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 4/12/2013 | |
| | | | |
| | | | |
FlexShares International Quality Dividend Dynamic Index Fund (Based on Net Asset Value) | | | 19.39 | % | | | 5.20 | % | | | 3.04 | % | | | 3.95 | % |
| | | | |
FlexShares International Quality Dividend Dynamic Index Fund (Based on Market Price) | | | 20.37 | % | | | 5.42 | % | | �� | 3.09 | % | | | 4.00 | % |
| | | | |
MSCI AC World ex USA Index | | | 12.07 | % | | | 3.46 | % | | | 2.54 | % | | | 3.27 | % |
| | | | |
Northern Trust International Quality Dividend Dynamic IndexSM | | | 20.36 | % | | | 5.61 | % | | | 3.49 | % | | | 4.40 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend Dynamic IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, provide exposure to a high-quality income-oriented universe of long-only international securities issued by non-U.S. based companies, with an emphasis on long-term capital growth and a targeted overall beta1 that is generally between 1.0 to 1.5 times that of the Northern Trust International Large Cap Index2. As of October 31, 2023, there were 171 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
During the 12 months ending October 31, 2023, prices on international equity securities generally traded higher. Over the course of the 12-month period the U.S. dollar (USD) declined and positively impacted U.S. investors as returns in international currencies generally were aided by the falling USD. Through Q4 of 2022, international markets rose as falling inflation and the anticipated boost to global growth resulting from the re-opening of China’s economy all supported equity security prices. International equities
1 | A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the S&P 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. |
2 | Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large- and mid-capitalization companies. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 43 | |
| | |
FlexShares® International | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Quality Dividend Dynamic Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
continued higher over the first half of 2023, as investors looked past concerns in the banking sector to falling energy prices, lower inflation, and strength in the technology and consumer discretionary sectors. International equities declined in Q3 of 2023, as higher energy prices and consumer spending concerns in China and Europe weighed on investors’ global growth outlook. International equities continued lower in October of 2023, as slowing global growth concerns and increased geopolitical tensions weighed on markets.
Because of the improved inflation outlook over the 12-month period, developed international investments trended higher during the 12 months ended October 31, 2023 and we believe the dividend yield factor3 was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor4 companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Because international equities moved higher over the 12 months, we believe that the high beta exposure also positively contributed to Fund performance. Overall, the positive performance derived from the dividend and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index’s outperformance against the MSCI All Country World Index Ex-U.S. Index5 by 8.29%.
Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -97 basis points (“bps”)6, which is reflective of the Fund’s management fee (47 bps), stock selection/futures (-24 bps), securities lending (+4 bps), dividend tax differential (1 bps), performance calculation differences between the Underlying Index and the Fund (+1 bps), and India Cap Gain Tax (-30 bps).
3 | Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index. |
4 | The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market. |
5 | The MSCI All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by MSCI and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
| | | | |
44 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® iBoxx | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
3-Year Target Duration TIPS Index Fund Ticker: TDTT
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/19/2011 | |
| | | | |
| | | | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (Based on Net Asset Value) | | | 1.84 | % | | | 3.01 | % | | | 1.59 | % | | | 1.42 | % |
| | | | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (Based on Market Price) | | | 1.76 | % | | | 3.03 | % | | | 1.60 | % | | | 1.42 | % |
| | | | |
iBoxx 3-Year Target Duration TIPS Index | | | 1.99 | % | | | 3.20 | % | | | 1.77 | % | | | 1.58 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the iBoxx 3-Year Target Duration TIPS Index (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of inflation protected public obligations of the U.S. Treasury, commonly known as “TIPS”, with a targeted average modified adjusted duration1 as defined by S&P Dow Jones Indices LLC as the index provider, of approximately three years. The Underlying Index includes publicly issued TIPS that have maturity dates of at least one year but not more than ten years from an index rebalancing date. As of October 31, 2023, there were 27 TIPS in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to achieve the Fund’s investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. “Representative sampling” means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as
1 | The duration calculated from the real modified duration of a TIPS security, adjusted for the market’s estimated beta for a TIPS security versus a nominal Treasury security due to the actual and expected changes in inflation. |
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| | FLEXSHARES ANNUAL REPORT | | | 45 | |
| | |
FlexShares® iBoxx | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
3-Year Target Duration TIPS Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
well as a rescue of a Swiss Bank. The ICE BofA MOVE Index2, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2-year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve3 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
TIPS inflation breakeven4 spreads moved lower during the fiscal year as investors weighed the impact of Fed actions and geopolitical events on future inflation potential. Headline inflation measures receded, though core services components remained elevated. The disinflationary period post the pandemic-era inflation shocks coincided with longer-term, structural forces such as labor market demographics, supply chain orientation, and green transition. Inflation expectations diminished, but remained modestly elevated against Fed policy levels. By the end of the fiscal year 2023, the 12-month change in TIPs breakeven spreads were: 1-year: -50 basis points (“bps”)5, 5-year: -28 bps, 10-year: -10 bps and 30-year: -2 bps.
Despite rising real interest rates, or an interest rate that has been adjusted for inflation, during the fiscal year 2023, both the Fund and the Underlying Index displayed positive total return performance. For the 12-month period, the NAV performance of the Fund outperformed the Bloomberg U.S. TIPS 1-10 Year Index6 by 79 bps, due in part to lower overall duration in the 1-3-year section of the TIPS yield curve with rising real interest rates. Tracking difference between the Fund’s NAV and the Underlying Index for the 12-month period was -15 bps, reflective of the Fund’s management fee (-18 bps), duration and yield curve positioning (+2 bps), security selection (+1 bps), trading costs (-2 bps), and other factors (+2 bps).
2 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
3 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
4 | Bloomberg. In this analysis we are making a comparison between the difference in the nominal yield and real yield rates of the 1-year, 5-year, 10-year and 30-year maturities using data available as of October 31, 2022 and October 31, 2023. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
6 | The Bloomberg US Treasury Inflation Notes: 1-10 Year Index (Series-B) measures the performance of the US Treasury Inflation Protected Securities (TIPS) market with less than 10 years to maturity. |
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46 | | FLEXSHARES ANNUAL REPORT | | |
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 9/19/2011 | |
| | | | |
| | | | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (Based on Net Asset Value) | | | -0.11 | % | | | 2.61 | % | | | 1.47 | % | | | 1.46 | % |
| | | | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (Based on Market Price) | | | -0.15 | % | | | 2.61 | % | | | 1.48 | % | | | 1.46 | % |
| | | | |
iBoxx 5-Year Target Duration TIPS Index | | | 0.19 | % | | | 2.85 | % | | | 1.64 | % | | | 1.63 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the iBoxx 5-Year Target Duration TIPS Index (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of inflation protected public obligations of the U.S. Treasury, commonly known as “TIPS”, with a targeted average modified adjusted duration1, as defined by S&P Dow Jones Indices LLC as the index provider, of approximately five years. The Underlying Index includes publicly issued TIPS that have maturity dates of at least three years but not more than twenty years from an index rebalancing date. As of October 31, 2023, there were 25 TIPS in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to achieve the Fund’s investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. “Representative sampling” means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE
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| | FLEXSHARES ANNUAL REPORT | | | 47 | |
| | |
FlexShares® iBoxx | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
5-Year Target Duration TIPS Index Fund Ticker: TDTF
1 | The duration calculated from the real modified duration of a TIPS security, adjusted for the market’s estimated beta for a TIPS security versus a nominal Treasury security due to the actual and expected changes in inflation. |
PORTFOLIO ANALYSIS (cont.)
BofA MOVE Index2, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2-year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve3 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
TIPS inflation breakeven4 spreads moved lower during the fiscal year as investors weighed the impact of Fed actions and geopolitical events on future inflation potential. Headline inflation measures receded, though core services components remained elevated. The disinflationary period post the pandemic-era inflation shocks coincided with longer-term, structural forces such as labor market demographics, supply chain orientation, and green transition. Inflation expectations diminished, but remained modestly elevated against Fed policy levels. By the end of the fiscal year 2023, the 12-month change in TIPs breakeven spreads were: 1-year: -50 basis points (“bps”) 5, 5-year: -28 bps, 10-year: -10 bps and 30-year: -2 bps.
Rising real interest rates, or an interest rate that has been adjusted for inflation, during the fiscal year led to nearly flat total return performance for both the Fund and the Underlying Index. For the 12-month period, the NAV performance of the Fund outperformed the Bloomberg U.S. TIPS 1-10 Year Index6 by 61 bps against the backdrop of rising real interest rates. Tracking difference between the Fund’s NAV and the Underlying Index for the 12-month period was -30 bps, reflective of the Fund’s management fee (-18 bps), duration and yield curve positioning (+2 bps), security selection (-2 bp), trading costs (-3 bps), and other factors (-9 bps).
The iBoxx 5-Year Target Duration TIPS Index is the intellectual property (including registered trademarks) of Markit iBoxx and/or its licensors (“Licensors”), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Markit iBoxx and its Licensors and neither of the Licensors shall have any liability with respect thereto.
2 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
3 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
4 | Bloomberg. In this analysis we are making a comparison between the difference in the nominal yield and real yield rates of the 1-year, 5-year, 10-year and 30-year maturities using data available as of October 31, 2022 and October 31, 2023. |
5 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
6 | The Bloomberg US Treasury Inflation Linked Bond Index (Series-L) measures the performance of the US Treasury Inflation Protected Securities (TIPS) market. |
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48 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® iBoxx | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
5-Year Target Duration TIPS Index Fund (cont.)
| | |
FlexShares® Disciplined | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Duration MBS Index Fund Ticker: MBSD
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 9/3/2014 | |
| | | | |
| | | | |
FlexShares Disciplined Duration MBS Index Fund (Based on Net Asset Value) | | | 0.98 | % | | | -4.01 | % | | | -0.02 | % | | | 0.35 | % |
| | | | |
FlexShares Disciplined Duration MBS Index Fund (Based on Market Price) | | | 1.13 | % | | | -3.99 | % | | | -0.06 | % | | | 0.36 | % |
| | | | |
ICE BofA® Constrained Duration US Mortgage Backed Securities IndexSM | | | 1.57 | % | | | -3.28 | % | | | 0.52 | % | | | 0.84 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.21% and the net expense ratio is 0.20%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the ICE BofA® Constrained Duration US Mortgage Backed Securities Index (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of investment-grade US agency residential mortgage-backed pass-through securities (“MBS”). Pursuant to the Underlying Index’s methodology, the Underlying Index constituents are capitalization-weighted, based on their outstanding face value times price plus accrued interest, adjusted by the index provider to achieve an effective duration1 that is generally between 3.25 and 4.25 years. As of October 31, 2023, there were 117 securities in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 49 | |
1 | Effective duration provides a measure of a fund’s interest-rate sensitivity and the longer a fund’s duration, the more sensitive the fund is to shifts in interest rates. Duration also gives an indication of how a fund’s NAV will change as interest rates change. A fund with a five-year duration would be expected to lose 5% of its NAV if interest rates rose by 1 percentage point or gain 5%, if interest rates fell by 1 percentage point. Morningstar surveys fund companies for this information. |
| | |
FlexShares® Disciplined | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Duration MBS Index Fund (cont.)
PORTFOLIO ANALYSIS(cont.)
of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE BofA MOVE Index2, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2 year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve3 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
The average 30-year mortgage rates (Freddie Mac Index4) dipped to 5.95% in January of 2023, and subsequently rose the remainder of the fiscal year to finish at 7.79%.
Despite rising interest rates and an inverted yield curve during the fiscal year, the Fund and the Underlying Index achieved a positive total return. For the 12-month period, the NAV performance of the Fund outperformed the Bloomberg U.S. Mortgage Backed Securities Index5 by 180 basis points (“bps”)6 due to the Underlying Index’s exposure to a selection of higher coupon7, more seasoned MBS securities, which were both higher yielding and shorter duration and outperformed the newer MBS that skewed heavily toward lower coupon and longer duration. Tracking difference between the Fund’s NAV and the Underlying Index’s total return for the 12-month period was -59 bps, reflective of the Fund’s management fee (-20 bps), trading costs and fees (-46 bps), yield curve positioning (+23 bps), sector allocation (+3 bps), security selection (-74 bps), and other factors (+55 bps).
The ICE BofA® Constrained Duration US Mortgage Backed Securities Index is the intellectual property (including registered trademarks) of ICE BofA® and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by ICE BofA® and its Licensors and neither of the Licensors shall have any liability with respect thereto.
2 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
3 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
4 | Source: Bloomberg, Freddie Mac US Mortgage Market Survey 30 Year Homeowner Commitment National. October 31, 2022 through November 1, 2023. |
5 | The Bloomberg U.S. Mortgage Backed Securities Index tracks fixed-rate agency mortgage backed passthrough securities guaranteed by Ginnie Mae (GNMA), Fannie Mae (FNMA), and Freddie Mac (FHLMC). |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
7 | A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. |
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50 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® Credit-Scored | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Corporate Bond Index Fund Ticker: SKOR
CUMULATIVE PERFORMANCE
Through October 31, 2023
* | The hybrid index performance information reflects the performance of the Northern Trust Credit-Scored US Corporate Bond IndexSM (Previous Index) through April 30, 2020 and the Northern Trust US Corporate Bond Quality Value IndexSM thereafter. The Previous Index terminated as of May 1, 2020. |
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 11/12/2014 | |
| | | | |
| | | | |
FlexShares Credit-Scored US Corporate Bond Index Fund (Based on Net Asset Value) | | | 3.92 | % | | | -3.05 | % | | | 1.76 | % | | | 1.76 | % |
| | | | |
FlexShares Credit-Scored US Corporate Bond Index Fund (Based on Market Price) | | | 3.94 | % | | | -3.00 | % | | | 1.77 | % | | | 1.78 | % |
| | | | |
Bloomberg Intermediate U.S. Corporate Index | | | 3.75 | % | | | -2.82 | % | | | 1.53 | % | | | 1.74 | % |
| | | | |
Hybrid Northern Trust Credit-Scored US Corporate Bond IndexSM/Northern Trust US Corporate Bond Quality Value IndexSM | | | 4.41 | % | | | -2.49 | % | | | 2.31 | %* | | | 2.50 | %* |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust US Corporate Bond Quality Value IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a diversified universe of intermediate maturity, US-dollar denominated bonds of companies with investment grade credit quality, favorable valuations, and enhanced short-term and long-term solvency. As of October 31, 2023, there were 2,851 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE BofA MOVE Index1, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
1 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 51 | |
| | |
FlexShares® Credit-Scored | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Corporate Bond Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2-year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve2 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads3 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)4 of the Bloomberg U.S. Credit Index5 peaked at 150 basis points
(“bps”)6 on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the fiscal year at 119 bps. Credit spreads in the U.S. high yield7 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index8. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
During the fiscal year, the Fund’s NAV outperformed the Bloomberg U.S. Intermediate Corporate Bond Index9 by 17 bps. Overall, credit performed well as investment grade spreads generally tightened throughout the trailing 12-month period. The Fund is designed to be sector neutral with performance predominantly driven by security selection within sectors and industries. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was -49 bps, which is reflective of the Fund’s management fee (-22 bps), trading costs (-15 bps), sampling (-15 bps), and other factors (+3 bps).
2 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
3 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
4 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the riskfree rate) and that spread is added to the fixed-income security for comparison purposes. |
5 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
7 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
8 | The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
9 | Bloomberg U.S. Intermediate Corporate Bond Index measures the investment grade, fixedrate, taxable corporate bond market that have between 1 and up to, but not including, 10 years to maturity. |
| | | | |
52 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® Credit-Scored | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Long Corporate Bond Index Fund Ticker: LKOR
CUMULATIVE PERFORMANCE
Through October 31, 2023
* | The hybrid index performance information reflects the performance of the Northern Trust Credit-Scored US Long Corporate Bond IndexSM (Previous Index) through April 30, 2020 and the Northern Trust US Long Corporate Bond Quality Value IndexSM thereafter. The Previous Index terminated as of May 1, 2020. |
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 9/23/2015 | |
| | | | |
| | | | |
FlexShares Credit-Scored US Long Corp Bond Index Fund (Based on Net Asset Value) | | | 1.59 | % | | | -9.92 | % | | | 0.24 | % | | | 1.33 | % |
| | | | |
FlexShares Credit-Scored US Long Corp Bond Index Fund (Based on Market Price) | | | 1.26 | % | | | -9.84 | % | | | 0.34 | % | | | 1.34 | % |
| | | | |
Bloomberg Long U.S. Corporate Index | | | 0.50 | % | | | -10.18 | % | | | -0.28 | % | | | 1.20 | % |
| | | | |
Hybrid Northern Trust Credit-Scored US Long Corporate Bond IndexSM/Northern Trust US Long Corporate Bond Quality Value IndexSM | | | 2.38 | % | | | -9.30 | % | | | 1.04 | %* | | | 2.28 | %* |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust US Long Corporate Bond Quality Value IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a diversified universe of longer term maturity, US-dollar denominated bonds of companies with investment grade credit quality, favorable valuations, and enhanced short-term and long-term solvency. As of October 31, 2023, there were 1,463 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE BofA MOVE Index1, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as
1 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 53 | |
| | |
FlexShares® Credit-Scored | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
US Long Corporate Bond Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2-year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve2 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads3 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)4 of the Bloomberg U.S. Credit Index5 peaked at 150 basis points (“bps”)6
on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the fiscal year at 119 bps. Credit spreads in the U.S. high yield7 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index8. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
During the fiscal year, the Fund’s NAV outperformed the Bloomberg U.S. Long Corporate Bond Index9 by 109 bps. Overall, credit performed well as investment grade spreads generally tightened throughout the trailing 12-month period. The Fund is designed to be sector neutral with performance predominantly driven by security selection within sectors and industries. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was -79 bps, which is reflective of the Fund’s management fee (-22 bps), trading costs (-19 bps), sampling (-33 bps), and other factors (-5 bps).
2 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
3 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
4 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the riskfree rate) and that spread is added to the fixed-income security for comparison purposes. |
5 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
7 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
8 | The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
9 | Bloomberg U.S. Long Corporate Bond Index measures the investment grade, fixed-rate, taxable corporate bond market that have a maturity of greater than or equal to 10 years. |
| | | | |
54 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® High Yield | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Value-Scored Bond Index Fund Ticker: HYGV
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 7/17/2018 | |
| | | | |
| | | | |
FlexShares High Yield Value-Scored US Bond Index Fund (Based on Net Asset Value) | | | 5.45 | % | | | 1.30 | % | | | 2.85 | % | | | 2.73 | % |
| | | | |
FlexShares High Yield Value-Scored US Bond Index Fund (Based on Market Price) | | | 5.48 | % | | | 1.28 | % | | | 2.89 | % | | | 2.76 | % |
| | | | |
ICE BofA® US High Yield Index | | | 5.82 | % | | | 1.24 | % | | | 2.88 | % | | | 2.76 | % |
| | | | |
Northern Trust High Yield Value-Scored US Corporate Bond IndexSM | | | 7.14 | % | | | 2.50 | % | | | 4.27 | % | | | 4.11 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust High Yield Value-Scored US Corporate Bond IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a diversified universe of U.S.-dollar denominated bonds of companies exhibiting favorable fundamental qualities, market valuations and liquidity, as defined by Northern Trust Investments, Inc.’s (“NTI”) proprietary scoring models. The securities included in the Underlying Index are a subset of the securities included in the Northern Trust High Yield US Corporate Bond IndexSM (the “Parent Index”) 1. The Underlying Index begins with the Parent Index and then follows a rules-based methodology to select and weight securities, subject to certain constraints, to optimize exposure to a proprietary value score2, credit-score3, and
1 | The Northern Trust High Yield US Corporate Bond IndexSM is a market capitalization weighted index comprised of U.S. dollar-denominated high yield corporate bonds. |
2 | The value score has multiple components, including: (a) valuation (e.g., to assess the relative value of the security versus other similar securities); (b) spread analysis (e.g., to assess the risk/return trade-off associated with each security versus other similar securities); and (c) financial solvency (e.g., debt servicing capacity). |
3 | The credit score has three components: (i) management efficiency (e.g., corporate finance activities and corporate governance), (ii) profitability (e.g., reliability and sustainability of financial performance); and (iii) financial solvency. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 55 | |
| | |
FlexShares® High Yield | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Value-Scored Bond Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
liquidity score4, each as determined by NTI, acting in its capacity as index provider. The primary objective of the optimization process is to maximize exposure to the value score relative to the Underlying Index’s eligible universe. As of October 31, 2023, there were 952 issues in the Underlying Index. NTI uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE BofA MOVE Index5, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed
did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve6 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads7 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)8 of the Bloomberg U.S. Credit Index9 peaked at 150 basis points
(“bps”)10 on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the
4 | The core components of the proprietary liquidity score are based on a quantitative ranking of security characteristics obtained from company filings. Examples of data sets utilized to determine liquidity include time to maturity (e.g. time until the security reaches its maturity date as measured in in years), total issuer debt outstanding (e.g. the sum of all debt outstanding for a single corporate issuer), and time since original issuance (e.g. the time that has elapsed since the security was originally issued as measured in years). |
5 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
6 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
7 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
8 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes. |
9 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
10 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
| | | | |
56 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® High Yield | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Value-Scored Bond Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
fiscal year at 119 bps. Credit spreads in the U.S. high yield11 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index12. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
During the fiscal year, the Fund’s NAV underperformed the ICE® BofA® U.S. High Yield Index by -37 bps. Both the Fund and the market index posted mid-single digit total returns for the fiscal year period. The Fund is designed to be sector neutral with performance predominantly driven by security selection within sectors and industries. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was -169 bps, which is reflective of the Fund’s management fee (-37 bps), trading costs (-53 bps), sampling (-60 bps), and other factors (-19 bps).
11 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
12 | The ICE® BofA® US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 57 | |
| | |
FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Investment Grade Corporate Core Index Fund Ticker: FEIG
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | |
| | 1 Year | | | Fund Inception 9/20/2021 | |
| | | | |
| | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund (Based on Net Asset Value) | | | 2.41 | % | | | -9.43 | % |
| | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund (Based on Market Price) | | | 2.28 | % | | | -9.41 | % |
| | |
Bloomberg US Corporate Total Return Value Unhedged Index | | | 2.77 | % | | | -9.16 | % |
| | |
Northern Trust ESG & Climate Investment Grade U.S. Corporate Core IndexSM | | | 2.88 | % | | | -9.12 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.13% and the net expense ratio is 0.12%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Investment Grade U.S. Corporate Core IndexSM (the “Underlying Index”). The Underlying Index is designed to reflect the performance of a selection of U.S.-dollar-denominated corporate bonds issued by companies that exhibit certain environmental, social and governance (“ESG”) characteristics, while also seeking to provide broad-market, core exposure to U.S.-dollar-denominated investment grade corporate bonds of U.S. and non-U.S. issuers. The Underlying Index is designed to minimize tracking differences relative to the Northern Trust US Corporate Bond IndexSM (the “Parent Index”) while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2023, there were 3,667 issues in the Underlying Index. Northern Trust Investments, Inc. (“NTI”) uses a “passive” or indexing approach to try to achieve the Fund’s investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE
| | | | |
58 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® ESG & Climate | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Investment Grade Corporate Core Index Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
BofA MOVE Index1, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve2 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads3 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)4 of the Bloomberg U.S. Credit Index5 peaked at 150 basis points (“bps”)6 on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the fiscal year at 119 bps. Credit spreads in the U.S. high yield7 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index8. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
During the fiscal year, the Fund’s NAV underperformed the Bloomberg U.S. Corporate Bond Index9 by -36 bps. Overall, credit performed well as investment grade spreads generally tightened throughout the trailing 12-month period. The Fund is designed to be sector neutral with security selection predominantly driven by ESG and carbon-related risk characteristics within sectors and industries. The tracking difference between the Fund’s NAV and the Underlying Index’s total return for the period was -47 bps, which is reflective of the Fund’s management fee (-12 bps), trading costs (-7 bps), sampling (-29 bps), and other factors (+1 bps).
1 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
2 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30-year maturities. |
3 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
4 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes. |
5 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
7 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
8 | The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
9 | Bloomberg U.S. Corporate Bond Index measures the investment grade, taxable corporate bond market. |
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| | FLEXSHARES ANNUAL REPORT | | | 59 | |
| | |
FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Ultra-Short Income Fund Ticker: RAVI
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 5 Year | | | 10 Year | | | Fund Inception 10/9/2012 | |
| | | | |
| | | | |
FlexShares Ultra-Short Income Fund (Based on Net Asset Value) | | | 5.27 | % | | | 1.99 | % | | | 1.54 | % | | | 1.46 | % |
| | | | |
FlexShares Ultra-Short Income Fund (Based on Market Price) | | | 5.30 | % | | | 1.98 | % | | | 1.53 | % | | | 1.46 | % |
| | | | |
Bloomberg 1-3 Month U.S. Treasury Bill Index | | | 4.88 | % | | | 1.77 | % | | | 1.14 | % | | | 1.03 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.25%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks maximum current income consistent with the preservation of capital and liquidity. The Fund seeks to achieve its investment objective by investing under normal circumstances at least 80% of its total assets in a portfolio of fixed-income instruments, including bonds, debt securities and other similar instruments issued by U.S. and non-U.S. public and private sector entities. Such issuers include, without limitation, U.S. and non-U.S. governments and their agencies, instrumentalities or sponsored enterprises, U.S. state and local governments and municipalities, and U.S. and non-U.S. private-sector entities, such as corporations and banks. The average effective duration1 of the Fund will vary based on The Northern Trust Company Investment Policy Committee’s forecast for interest rates and will normally not exceed one year. The dollar-weighted average portfolio maturity of the Fund is normally not expected to exceed two years.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE
1 | Average effective duration provides a measure of a fund’s interest-rate sensitivity and the longer a fund’s duration, the more sensitive the fund is to shifts in interest rates. Duration also gives an indication of how a fund’s NAV will change as interest rates change. A fund with a five-year duration would be expected to lose 5% of its NAV if interest rates rose by 1 percentage point, or gain 5%, if interest rates fell by 1 percentage point. Morningstar surveys fund companies for this information. |
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60 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Ultra-Short Income Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
BofA MOVE Index2, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve3 with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and
fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads4 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)5 of the Bloomberg U.S. Credit Index6 peaked at 150 basis points (“bps”)7 on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the fiscal year at 119 bps. Credit spreads in the U.S. high yield8 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index9. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
For the 12 months ended October 31, 2023, the Fund outperformed the generic Treasury Bill index, as defined by the Bloomberg 1-3 Month U.S. Treasury Bill Index10, by 39 basis points (“bps”)11. During this period, 1-3 month Treasury yields rose drastically (1-month Treasury Bill yields rose by 179 bps and 3-month Bill yields rose by 141 bps). The Fund’s underweight to Treasuries, as well as its long to duration positioning, detracted slightly from performance as short-term rates rose, while the Fund’s curve positioning contributed positively to performance. The Fund’s exposure to corporate credit securities positively impacted performance versus the benchmark index.
2 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
3 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year, and 30year maturities. |
4 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
5 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the riskfree rate) and that spread is added to the fixed-income security for comparison purposes. |
6 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
7 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
8 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
9 | The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
10 | The Bloomberg 1-3 Month U.S. Treasury Bill Index is designed to measure the performance of public obligations of the U.S. Treasury that have a remaining maturity of greater than or equal to 1 month and less than 3 months. |
11 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 61 | |
| | |
FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Core Select Bond Fund Ticker: BNDC
CUMULATIVE PERFORMANCE
Through October 31, 2023
AVERAGE ANNUAL TOTAL RETURN
For the period ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | 1 Year | | | 3 Year | | | 5 Year | | | Fund Inception 11/18/2016 | |
| | | | |
| | | | |
FlexShares Core Select Bond Fund (Based on Net Asset Value) | | | -0.15 | % | | | -5.71 | % | | | -0.08 | % | | | -0.05 | % |
| | | | |
FlexShares Core Select Bond Fund (Based on Market Price) | | | -0.15 | % | | | -5.72 | % | | | -0.10 | % | | | -0.05 | % |
| | | | |
Bloomberg U.S. Aggregate Bond Index | | | 0.36 | % | | | -5.57 | % | | | -0.06 | % | | | 0.13 | % |
All data as of 10/31/23. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value (“NAV”) assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund’s portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.
Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund’s total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.
Performance reflects contractual reimbursements in effect until March 1, 2024. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.56% and the net expense ratio is 0.35%. The gross and net expense ratios disclosed are as reported in the Fund’s prospectus, which may differ from the gross and net expense ratios presented in the Fund’s financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.
FlexShares ETFs’ performance data current to the most recent month-end is available at www.flexshares.com.
PORTFOLIO ANALYSIS
The Fund seeks total return and preservation of capital. The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in U.S. dollar-denominated investment-grade fixed-income securities either directly or indirectly through exchange-traded funds (“ETFs”) and other registered investment companies (together with ETFs, “Underlying Funds”). The Fund primarily invests in fixed-rate securities of varying maturities, including bonds, debt securities and other similar instruments issued by U.S. public and U.S and non-U.S. private sector entities. Such issuers include, without limitation, U.S. governments and their agencies, instrumentalities or sponsored enterprises, and U.S. and non-U.S. private-sector entities, such as corporations and banks. The Fund may invest in fixed income securities of any maturity.
The Fund seeks to provide attractive risk-adjusted performance by investing in a portfolio of fixed-income securities and Underlying Funds. The Fund generally adjusts its allocations to securities based on Northern Trust Investment Inc.’s (“NTI”) assessment of potential changes in interest rate levels, the shape of the yield curve1 and credit spread relationships, which is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. The Fund also seeks to balance the potential for return and risk while emphasizing liquidity and diversification across a spectrum of U.S. dollar-denominated investment-grade fixed income securities.
In the beginning of the fiscal year ending October 31, 2023, fixed income investments moved higher coming off extremely depressed levels, as market implied odds over a soft landing versus hard landing fluctuated. The beginning of the 2023 calendar year saw fixed income assets continue to post positive
1 | A yield curve is constructed by plotting a session’s final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year and 30year maturities. |
| | | | |
62 | | FLEXSHARES ANNUAL REPORT | | |
| | |
FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Core Select Bond Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
results despite significant interest rate volatility. Ultimately, the 2-year and 10-year treasury yields dropped in parallel down 0.40% in Q1 of 2023, while the U.S. Federal Reserve (the “Fed”) raised the Fed Funds rate twice. Overall, the markets entered a period of extreme volatility in March of 2023, following the regional banking disruptions as well as a rescue of a Swiss Bank. The ICE BofA MOVE Index2, which measures bond market volatility, spiked on March 15, 2023 to a price of 198, which was a level last seen during the Great Financial Crisis. As Q1 of 2023 came to a close, fixed income investments rallied as investors sought relative safety, and systemic banking concerns were diminishing.
By the summer of 2023, treasury rates increased as inflation remained elevated as strength persisted in the U.S. labor market amidst the rising rate environment. During Q2 of 2023, the 2year treasury yields rose 0.87%, the 10-year treasury yields rose 0.37%, and the 30-year treasury yields rose by 0.21%. While the Fed did hike rates heading into the summer, they chose to pause in June of 2023. Inflation remained elevated into Q3 of 2023, and the labor market remained resilient. The Fed left rates unchanged at their September 2023 meeting, though market participants interpreted that decision as a hawkish pause to allow time to further evaluate the influence of the overall tightening on the U.S. economy. Treasuries sold off throughout Q3 of 2023, specifically in the middle to long end of the yield curve with 10-year and 30-year treasury yields rising to 4.57% and 4.70%, respectively.
During October of 2023, fixed income investments were under pressure as we observed a continuation in the rise of interest rates, which we believe was driven not by the changing expectations for inflation or the
Fed, but instead an increase in the required term premium, or the compensation that investors require for bearing the risk that interest rates may change over the life of the bond, given economic uncertainty and interest rate volatility.
Credit fundamentals remained relatively stable throughout the year as the U.S. economy was resilient, and fears of a recession seemed to subside or at least pushed out further into the future. Investment grade credit spreads3 generally tightened throughout the fiscal year with a short-lived spike wider in March of 2023. The option adjusted spread (“OAS”)4 of the Bloomberg U.S. Credit Index5 peaked at 150 basis points (“bps”)6 on March 15, 2023 amidst the extreme market volatility centered around regional bank uncertainty, then declined to a low of 104 bps at the end of July 2023. OAS then held relatively steady around these period low levels until October of 2023, which saw spreads mildly widen back out to finish the fiscal year at 119 bps. Credit spreads in the U.S. high yield7 market followed a similar path, as investment grade spreads during the fiscal year spiked up to 520 bps in March, measured by the OAS of the ICE BofA U.S. High Yield Index8. High yield spreads then tightened to a period low at the end of July 2023, and subsequently widened gently to finish the fiscal year at 448 bps.
During the fiscal year, the Fund was generally positioned neutral in comparison to the Bloomberg U.S. Aggregate Bond Index9 from a bond sector standpoint. The Fund did have a modest overweight to mortgage-backed securities (“MBS”) where we saw opportunity, given how cheap MBS spreads were trading relative to historical averages. While MBS spreads rallied through most of the fiscal year, they have sold off since July 2023 on the back of increased interest rate volatility,
2 | The ICE BofA MOVE Index measures U.S. bond market volatility by tracking a basket of OTC options on U.S. interest rate swaps. |
3 | Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. |
4 | The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the riskfree rate) and that spread is added to the fixed-income security for comparison purposes. |
5 | Bloomberg U.S. Credit Index measures the investment grade, US dollar-denominated, taxable corporate and government related bond markets. |
6 | A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. |
7 | High yield are fixed income securities that are rated in the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below. |
8 | The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as “junk”) corporate debt publicly issued in the U.S. domestic market. |
9 | Bloomberg U.S. Aggregate Bond Index is a broad based benchmark that measures the investment grade, US dollar denominated, taxable bond market that includes treasuries, government related and corporate securities, mortgage backed securities, asset backed securities and collateralized mortgage backed securities. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 63 | |
| | |
FlexShares® | | MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE |
Core Select Bond Fund (cont.)
PORTFOLIO ANALYSIS (cont.)
which was followed by MBS spread widening. Overall, the allocation to MBS was a modest positive contributor to Fund performance, which was offset by selection effects. Toward the end of the fiscal year, we changed the Fund’s duration positioning, moving from neutral on duration and yield curve positioning to a modest overweight position at the portfolio level. Treasury yields have risen significantly over the last several weeks of the fiscal year with the bulk of the move driven by wider term premiums. Our view is that the current level of term premium, or the added compensation we believe investors expect for the unknowns associated with holding longer-term debt, we see (in 10 year rates) is not justified by relevant macroeconomic factors such as long term growth and inflation expectations. We believe that the term premium could compress closer to our expectations of fair value. Over the fiscal year, the Fund underperformed the broader bond index, as defined by the Bloomberg U.S. Aggregate Bond Index, by -51 basis points.
| | | | |
64 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Trust
Statements of Assets and Liabilities October 31, 2023
| | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Low Volatility Index Fund | | | FlexShares® Developed Markets ex- US Quality Low Volatility Index Fund | | | FlexShares® Emerging Markets Quality Low Volatility Index Fund | | | FlexShares® Morningstar US Market Factor Tilt Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 173,345,381 | | | $ | 65,665,911 | | | $ | 13,811,847 | | | $ | 853,779,239 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | 511,950 | |
Securities Lending Reinvestments, at cost | | | 2,683,994 | | | | — | | | | — | | | | 167,140,618 | |
| | | | |
Securities, at value† | | | 184,796,795 | | | | 64,658,984 | | | | 12,867,943 | | | | 1,323,299,186 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | 459,393 | |
Securities Lending Reinvestments, at value | | | 2,683,994 | | | | — | | | | — | | | | 167,151,673 | |
Cash | | | — | | | | 601,264 | | | | 90,240 | | | | 10,768,083 | |
Cash segregated at broker* | | | 283 | | | | 163,088 | | | | 20,694 | | | | 1,779,829 | |
Foreign cash†† | | | — | | | | 457,840 | | | | 34,302 | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | — | | | | 27,699 | | | | — | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 149,206 | | | | 477,672 | | | | 10,022 | | | | 889,549 | |
Securities lending income | | | 1,261 | | | | 635 | | | | — | | | | 52,209 | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | 729 | | | | 286 | | | | 119 | | | | 5,223 | |
Securities sold | | | 113,852 | | | | — | | | | — | | | | 411 | |
Variation margin on futures contracts | | | 1,976 | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 187,748,096 | | | | 66,387,468 | | | | 13,023,320 | | | | 1,504,405,556 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | 13,058 | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | — | | | | 18,644 | | | | — | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 2,683,994 | | | | — | | | | — | | | | 167,151,893 | |
Deferred compensation (Note 7) | | | 8,045 | | | | 4,295 | | | | 729 | | | | 169,566 | |
Investment advisory fees (Note 4) | | | 35,020 | | | | 18,329 | | | | 4,464 | | | | 290,517 | |
Trustee fees (Note 7) | | | 1,259 | | | | 613 | | | | 125 | | | | 10,807 | |
Securities purchased | | | — | | | | — | | | | — | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | — | | | | 20,095 | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | 411 | |
Variation margin on futures contracts | | | — | | | | 82,236 | | | | 14,061 | | | | 763,593 | |
Capital shares redeemed | | | — | | | | — | | | | — | | | | — | |
Other | | | 2,100 | | | | — | | | | 4,000 | | | | 7,708 | |
| | | | |
Total Liabilities | | | 2,743,476 | | | | 124,117 | | | | 43,474 | | | | 168,394,495 | |
| | | | |
Net Assets | | $ | 185,004,620 | | | $ | 66,263,351 | | | $ | 12,979,846 | | | $ | 1,336,011,061 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 184,240,592 | | | $ | 72,298,348 | | | $ | 15,413,162 | | | $ | 910,599,852 | |
Distributable earnings (loss) | | | 764,028 | | | | (6,034,997 | ) | | | (2,433,316 | ) | | | 425,411,209 | |
| | | | |
Net Assets | | $ | 185,004,620 | | | $ | 66,263,351 | | | $ | 12,979,846 | | | $ | 1,336,011,061 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 3,600,001 | | | | 2,800,001 | | | | 600,001 | | | | 8,500,001 | |
Net Asset Value | | $ | 51.39 | | | $ | 23.67 | | | $ | 21.63 | | | $ | 157.18 | |
| | | | |
† Securities on loan, at value | | $ | 13,821,520 | | | $ | 2,212,131 | | | $ | — | | | $ | 206,017,475 | |
†† Cost of foreign cash | | $ | — | | | $ | 463,825 | | | $ | 33,435 | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 65 | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | | | FlexShares® US Quality Large Cap Index Fund | | | FlexShares® STOXX® US ESG Select Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 439,193,329 | | | $ | 212,305,889 | | | $ | 138,888,823 | | | $ | 153,363,355 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | 94,332 | |
Securities Lending Reinvestments, at cost | | | 8,760,452 | | | | 677,315 | | | | — | | | | 97,159 | |
| | | | |
Securities, at value† | | | 462,046,494 | | | | 218,908,022 | | | | 145,727,979 | | | | 164,852,322 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | 77,115 | |
Securities Lending Reinvestments, at value | | | 8,760,452 | | | | 677,315 | | | | — | | | | 97,159 | |
Cash | | | 1,014,072 | | | | 204,890 | | | | 927,601 | | | | 1,747,305 | |
Cash segregated at broker* | | | 845,221 | | | | 120,659 | | | | 153,608 | | | | 305,740 | |
Foreign cash†† | | | 2,442,412 | | | | 481,779 | | | | — | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | 14,407 | | | | 6,171 | | | | — | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 3,421,440 | | | | 315,948 | | | | 107,697 | | | | 119,805 | |
Securities lending income | | | 23,942 | | | | 8,626 | | | | 442 | | | | 486 | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | 5,571 | | | | 25,931 | | | | — | | | | 641 | |
Securities sold | | | 84,733 | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 478,658,744 | | | | 220,749,341 | | | | 146,917,327 | | | | 167,200,573 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | 44,298 | | | | 333 | | | | — | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 8,760,452 | | | | 677,315 | | | | — | | | | 97,159 | |
Deferred compensation (Note 7) | | | 94,455 | | | | 46,877 | | | | 7,498 | | | | 9,310 | |
Investment advisory fees (Note 4) | | | 158,640 | | | | 113,389 | | | | 31,354 | | | | 46,246 | |
Trustee fees (Note 7) | | | 4,045 | | | | 1,788 | | | | 2,377 | | | | 1,281 | |
Securities purchased | | | — | | | | — | | | | — | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | 1,078,422 | | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | 331,029 | | | | 57,692 | | | | 67,206 | | | | 121,129 | |
Capital shares redeemed | | | — | | | | — | | | | — | | | | — | |
Other | | | 27,000 | | | | 50,000 | | | | 3,000 | | | | 700 | |
| | | | |
Total Liabilities | | | 9,419,919 | | | | 2,025,816 | | | | 111,435 | | | | 275,825 | |
| | | | |
Net Assets | | $ | 469,238,825 | | | $ | 218,723,525 | | | $ | 146,805,892 | | | $ | 166,924,748 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 573,435,084 | | | $ | 291,920,670 | | | $ | 147,359,786 | | | $ | 162,616,808 | |
Distributable earnings (loss) | | | (104,196,259 | ) | | | (73,197,145 | ) | | | (553,894 | ) | | | 4,307,940 | |
| | | | |
Net Assets | | $ | 469,238,825 | | | $ | 218,723,525 | | | $ | 146,805,892 | | | $ | 166,924,748 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 7,800,001 | | | | 4,700,001 | | | | 3,150,001 | | | | 1,625,001 | |
Net Asset Value | | $ | 60.16 | | | $ | 46.54 | | | $ | 46.61 | | | $ | 102.72 | |
| | | | |
† Securities on loan, at value | | $ | 53,104,871 | | | $ | 5,168,593 | | | $ | 4,023,270 | | | $ | 4,105,867 | |
†† Cost of foreign cash | | $ | 2,454,649 | | | $ | 432,693 | | | $ | — | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | |
66 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® Global ESG Select Index Fund | | | FlexShares® ESG & Climate US Large Cap Core Index Fund | | | FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | | FlexShares® ESG & Climate Emerging Markets Core Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 125,624,190 | | | $ | 36,531,669 | | | $ | 38,644,229 | | | $ | 4,738,015 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at cost | | | 857,504 | | | | — | | | | — | | | | — | |
| | | | |
Securities, at value† | | | 150,048,123 | | | | 36,613,279 | | | | 36,835,813 | | | | 4,152,508 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at value | | | 857,504 | | | | — | | | | — | | | | — | |
Cash | | | 1,149,258 | | | | 252,917 | | | | 199,496 | | | | 9,025 | |
Cash segregated at broker* | | | 205,971 | | | | 20,080 | | | | 69,280 | | | | 6,742 | |
Foreign cash†† | | | 169,454 | | | | — | | | | 260,687 | | | | 30,703 | |
Unrealized appreciation on forward foreign currency contracts | | | 7,756 | | | | — | | | | 6,492 | | | | 3 | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 402,478 | | | | 30,508 | | | | 147,985 | | | | 5,319 | |
Securities lending income | | | 1,000 | | | | — | | | | — | | | | — | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | — | | | | 169 | | | | 208 | | | | 18 | |
Securities sold | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 152,841,544 | | | | 36,916,953 | | | | 37,519,961 | | | | 4,204,318 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | — | | | | — | | | | 3,294 | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 857,504 | | | | — | | | | — | | | | — | |
Deferred compensation (Note 7) | | | 10,464 | | | | 410 | | | | 422 | | | | 81 | |
Investment advisory fees (Note 4) | | | 54,993 | | | | 2,797 | | | | 3,890 | | | | 656 | |
Trustee fees (Note 7) | | | 7,085 | | | | 162 | | | | 193 | | | | 34 | |
Securities purchased | | | — | | | | — | | | | — | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | — | | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | 95,878 | | | | 17,698 | | | | 23,456 | | | | 3,510 | |
Capital shares redeemed | | | — | | | | — | | | | — | | | | — | |
Other | | | — | | | | — | | | | 4,500 | | | | — | |
| | | | |
Total Liabilities | | | 1,025,924 | | | | 21,067 | | | | 35,755 | | | | 4,281 | |
| | | | |
Net Assets | | $ | 151,815,620 | | | $ | 36,895,886 | | | $ | 37,484,206 | | | $ | 4,200,037 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 135,039,800 | | | $ | 37,339,681 | | | $ | 41,394,939 | | | $ | 5,009,376 | |
Distributable earnings (loss) | | | 16,775,820 | | | | (443,795 | ) | | | (3,910,733 | ) | | | (809,339 | ) |
| | | | |
Net Assets | | $ | 151,815,620 | | | $ | 36,895,886 | | | $ | 37,484,206 | | | $ | 4,200,037 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 1,150,001 | | | | 775,000 | | | | 900,000 | | | | 100,000 | |
Net Asset Value | | $ | 132.01 | | | $ | 47.61 | | | $ | 41.65 | | | $ | 42.00 | |
| | | | |
† Securities on loan, at value | | $ | 6,708,462 | | | $ | — | | | $ | — | | | $ | — | |
†† Cost of foreign cash | | $ | 172,364 | | | $ | — | | | $ | 263,945 | | | $ | 30,684 | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 67 | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | FlexShares® STOXX® Global Broad Infrastructure Index Fund | | | FlexShares® Global Quality Real Estate Index Fund | | | FlexShares® Real Assets Allocation Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 6,639,775,626 | | | $ | 2,132,513,770 | | | $ | 283,496,998 | | | $ | — | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | 20,377,865 | |
Securities Lending Reinvestments, at cost | | | 303,751,788 | | | | 40,144,363 | | | | 2,704,220 | | | | — | |
| | | | |
Securities, at value† | | | 6,897,383,095 | | | | 2,006,949,303 | | | | 241,286,554 | | | | — | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | 16,571,447 | |
Securities Lending Reinvestments, at value | | | 303,763,185 | | | | 40,144,363 | | | | 2,704,220 | | | | — | |
Cash | | | 6,822,064 | | | | 5,640,536 | | | | 1,449,049 | | | | 2,514 | |
Cash segregated at broker* | | | 4,513,288 | | | | 2,107,602 | | | | 663,575 | | | | — | |
Foreign cash†† | | | 14,711,263 | | | | 6,213,137 | | | | 502,063 | | | | — | |
Due from Custodian | | | 322,346 | | | | — | | | | — | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | 805,889 | | | | 78,847 | | | | 17,694 | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 6,938,045 | | | | 6,579,205 | | | | 1,154,225 | | | | — | |
Securities lending income | | | 56,938 | | | | 51,122 | | | | 3,174 | | | | — | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | 81,718 | | | | 6,879 | | | | 1,144 | | | | 54 | |
Securities sold | | | — | | | | 22,684 | | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 7,235,397,831 | | | | 2,067,793,678 | | | | 247,781,698 | | | | 16,574,015 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | 827,889 | | | | 14,821 | | | | 20,492 | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 303,760,945 | | | | 40,144,363 | | | | 2,704,220 | | | | — | |
Deferred compensation (Note 7) | | | 630,214 | | | | 187,777 | | | | 33,220 | | | | 1,098 | |
Investment advisory fees (Note 4) | | | 2,773,369 | | | | 804,125 | | | | 102,691 | | | | 164 | |
Trustee fees (Note 7) | | | 56,957 | | | | 20,170 | | | | 2,787 | | | | 202 | |
Securities purchased | | | 322,346 | | | | — | | | | — | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | 467,278 | | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | 1,738,563 | | | | 961,681 | | | | 240,957 | | | | — | |
Capital shares redeemed | | | — | | | | — | | | | — | | | | — | |
Other | | | 1,500 | | | | 12,000 | | | | 4,000 | | | | — | |
| | | | |
Total Liabilities | | | 310,111,783 | | | | 42,612,215 | | | | 3,108,367 | | | | 1,464 | |
| | | | |
Net Assets | | $ | 6,925,286,048 | | | $ | 2,025,181,463 | | | $ | 244,673,331 | | | $ | 16,572,551 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 7,763,793,249 | | | $ | 2,386,937,469 | | | $ | 352,923,923 | | | $ | 21,145,503 | |
Distributable earnings (loss) | | | (838,507,201 | ) | | | (361,756,006 | ) | | | (108,250,592 | ) | | | (4,572,952 | ) |
| | | | |
Net Assets | | $ | 6,925,286,048 | | | $ | 2,025,181,463 | | | $ | 244,673,331 | | | $ | 16,572,551 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 179,600,001 | | | | 42,400,001 | | | | 5,200,001 | | | | 600,001 | |
Net Asset Value | | $ | 38.56 | | | $ | 47.76 | | | $ | 47.05 | | | $ | 27.62 | |
| | | | |
† Securities on loan, at value | | $ | 491,197,028 | | | $ | 185,056,097 | | | $ | 27,759,368 | | | $ | — | |
†† Cost of foreign cash | | $ | 14,296,646 | | | $ | 6,273,330 | | | $ | 508,327 | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | |
68 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Quality Dividend Index Fund | | | FlexShares® Quality Dividend Defensive Index Fund | | | FlexShares® International Quality Dividend Index Fund | | | FlexShares® International Quality Dividend Defensive Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 1,330,163,281 | | | $ | 287,654,026 | | | $ | 509,465,426 | | | $ | 26,583,706 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at cost | | | 129,443,897 | | | | 18,783,683 | | | | 2,149,574 | | | | 125,891 | |
| | | | |
Securities, at value† | | | 1,475,944,235 | | | | 311,680,030 | | | | 489,966,079 | | | | 25,342,351 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at value | | | 129,449,855 | | | | 18,783,683 | | | | 2,149,574 | | | | 125,891 | |
Cash | | | 790,358 | | | | 1,159,428 | | | | 1,044,964 | | | | 362,273 | |
Cash segregated at broker* | | | 392,110 | | | | 276,551 | | | | 956,449 | | | | 142,747 | |
Foreign cash†† | | | — | | | | — | | | | 4,801,677 | | | | 460,971 | |
Unrealized appreciation on forward foreign currency contracts | | | — | | | | — | | | | 212,595 | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 1,832,869 | | | | 331,873 | | | | 3,363,902 | | | | 288,033 | |
Securities lending income | | | 51,201 | | | | 8,919 | | | | 11,655 | | | | 595 | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | 5,563 | | | | 992 | | | | 46,981 | | | | 45 | |
Securities sold | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 1,608,466,191 | | | | 332,241,476 | | | | 502,553,876 | | | | 26,722,906 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | — | | | | — | | | | 135,605 | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 129,448,662 | | | | 18,783,683 | | | | 2,149,574 | | | | 125,891 | |
Deferred compensation (Note 7) | | | 195,602 | | | | 45,058 | | | | 76,714 | | | | 9,844 | |
Investment advisory fees (Note 4) | | | 473,493 | | | | 100,017 | | | | 202,770 | | | | 7,264 | |
Trustee fees (Note 7) | | | 11,840 | | | | 2,716 | | | | 3,914 | | | | 312 | |
Securities purchased | | | — | | | | — | | | | — | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | — | | | | 574,995 | | | | 1,768 | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | 58,788 | | | | 76,404 | | | | 522,390 | | | | 74,455 | |
Capital shares redeemed | | | — | | | | — | | | | — | | | | — | |
Other | | | 4,990 | | | | 2,500 | | | | 12,000 | | | | — | |
| | | | |
Total Liabilities | | | 130,193,375 | | | | 19,010,378 | | | | 3,677,962 | | | | 219,534 | |
| | | | |
Net Assets | | $ | 1,478,272,816 | | | $ | 313,231,098 | | | $ | 498,875,914 | | | $ | 26,503,372 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 1,477,021,150 | | | $ | 326,777,651 | | | $ | 713,024,210 | | | $ | 57,004,550 | |
Distributable earnings (loss) | | | 1,251,666 | | | | (13,546,553 | ) | | | (214,148,296 | ) | | | (30,501,178 | ) |
| | | | |
Net Assets | | $ | 1,478,272,816 | | | $ | 313,231,098 | | | $ | 498,875,914 | | | $ | 26,503,372 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 27,167,921 | | | | 5,875,001 | | | | 24,100,001 | | | | 1,400,001 | |
Net Asset Value | | $ | 54.41 | | | $ | 53.32 | | | $ | 20.70 | | | $ | 18.93 | |
| | | | |
† Securities on loan, at value | | $ | 149,621,313 | | | $ | 26,472,637 | | | $ | 24,751,395 | | | $ | 1,119,564 | |
†† Cost of foreign cash | | $ | — | | | $ | — | | | $ | 4,828,308 | | | $ | 460,068 | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 69 | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Dynamic Index Fund | | | FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | | | FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund | | | FlexShares® Disciplined Duration MBS Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 70,125,114 | | | $ | 2,015,549,742 | | | $ | 871,004,354 | | | $ | 81,464,885 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at cost | | | 695,880 | | | | — | | | | — | | | | — | |
| | | | |
Securities, at value† | | | 64,781,455 | | | | 1,923,187,015 | | | | 809,374,738 | | | | 73,778,449 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at value | | | 695,880 | | | | — | | | | — | | | | — | |
Cash | | | 466,450 | | | | 2,971,936 | | | | 1,785,614 | | | | 11,917,382 | |
Cash segregated at broker* | | | 117,684 | | | | — | | | | — | | | | — | |
Foreign cash†† | | | 120,651 | | | | — | | | | — | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | 5,506 | | | | — | | | | — | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 479,002 | | | | 3,504,025 | | | | 1,664,433 | | | | 204,321 | |
Securities lending income | | | 1,055 | | | | 2,335 | | | | 1,155 | | | | — | |
Capital shares issued | | | — | | | | — | | | | — | | | | — | |
Investment adviser | | | — | | | | 4,709 | | | | 1,790 | | | | 150 | |
Securities sold | | | — | | | | 60,279,072 | | | | 36,313,271 | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 66,667,683 | | | | 1,989,949,092 | | | | 849,141,001 | | | | 85,900,302 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | 1,549 | | | | — | | | | — | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | 695,880 | | | | — | | | | — | | | | — | |
Deferred compensation (Note 7) | | | 6,642 | | | | 278,900 | | | | 98,966 | | | | 8,144 | |
Investment advisory fees (Note 4) | | | 26,663 | | | | 295,604 | | | | 124,152 | | | | 11,320 | |
Trustee fees (Note 7) | | | 3,958 | | | | 15,863 | | | | 5,056 | | | | 772 | |
Securities purchased | | | — | | | | 60,275,369 | | | | 33,947,342 | | | | 11,454,027 | |
Deferred non-US capital gains taxes | | | 147,073 | | | | — | | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | 68,710 | | | | — | | | | — | | | | — | |
Capital shares redeemed | | | — | | | | 1,160,119 | | | | 3,415,083 | | | | — | |
Other | | | 3,500 | | | | — | | | | — | | | | 2,000 | |
| | | | |
Total Liabilities | | | 953,975 | | | | 62,025,855 | | | | 37,590,599 | | | | 11,476,263 | |
| | | | |
Net Assets | | $ | 65,713,708 | | | $ | 1,927,923,237 | | | $ | 811,550,402 | | | $ | 74,424,039 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 94,685,648 | | | $ | 2,172,291,648 | | | $ | 921,517,996 | | | $ | 96,332,336 | |
Distributable earnings (loss) | | | (28,971,940 | ) | | | (244,368,411 | ) | | | (109,967,594 | ) | | | (21,908,297 | ) |
| | | | |
Net Assets | | $ | 65,713,708 | | | $ | 1,927,923,237 | | | $ | 811,550,402 | | | $ | 74,424,039 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 2,700,001 | | | | 83,204,000 | | | | 35,650,001 | | | | 3,800,001 | |
Net Asset Value | | $ | 24.34 | | | $ | 23.17 | | | $ | 22.76 | | | $ | 19.59 | |
| | | | |
† Securities on loan, at value | | $ | 2,403,416 | | | $ | 1,197,583 | | | $ | — | | | $ | — | |
†† Cost of foreign cash | | $ | 121,554 | | | $ | — | | �� | $ | — | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | |
70 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Credit-Scored US Corporate Bond Index Fund | | | FlexShares® Credit-Scored US Long Corporate Bond Index Fund | | | FlexShares® High Yield Value-Scored Bond Index Fund | | | FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | |
|
ASSETS | |
Securities, at cost | | $ | 280,469,072 | | | $ | 34,128,436 | | | $ | 1,262,089,529 | | | $ | 27,258,976 | |
Affiliate securities, at cost | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at cost | | | — | | | | — | | | | — | | | | — | |
| | | | |
Securities, at value† | | | 265,621,732 | | | | 27,787,389 | | | | 1,199,469,056 | | | | 23,856,368 | |
Affiliate securities, at value | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments, at value | | | — | | | | — | | | | — | | | | — | |
Cash | | | 4,973,677 | | | | 444,830 | | | | 11,721,098 | | | | 544,398 | |
Cash segregated at broker* | | | — | | | | — | | | | — | | | | — | |
Foreign cash†† | | | — | | | | — | | | | — | | | | — | |
Due from Custodian | | | — | | | | — | | | | 370,076 | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | — | | | | — | | | | — | | | | — | |
Receivables: | | | — | | | | — | | | | — | | | | — | |
Dividends and interest | | | 2,871,765 | | | | 435,805 | | | | 23,574,590 | | | | 281,528 | |
Securities lending income | | | — | | | | — | | | | — | | | | — | |
Capital shares issued | | | — | | | | — | | | | 3,875,284 | | | | — | |
Investment adviser | | | 686 | | | | 88 | | | | 25,072 | | | | 224 | |
Securities sold | | | 25,582,442 | | | | 2,521,186 | | | | 100,752,851 | | | | 688,634 | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Assets | | | 299,050,302 | | | | 31,189,298 | | | | 1,339,788,027 | | | | 25,371,152 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | — | | | | — | | | | — | | | | — | |
Payables: | | | | | | | | | | | | | | | | |
Cash collateral received from securities loaned | | | — | | | | — | | | | — | | | | — | |
Deferred compensation (Note 7) | | | 17,626 | | | | 3,747 | | | | 24,907 | | | | 407 | |
Investment advisory fees (Note 4) | | | 50,990 | | | | 5,433 | | | | 387,076 | | | | 2,534 | |
Trustee fees (Note 7) | | | 1,600 | | | | 298 | | | | 6,315 | | | | 232 | |
Securities purchased | | | 24,427,347 | | | | 2,604,356 | | | | 111,225,782 | | | | 693,832 | |
Deferred non-US capital gains taxes | | | — | | | | — | | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | — | | | | — | | | | — | |
Capital shares redeemed | | | — | | | | — | | | | 5,812,926 | | | | — | |
Other | | | 3,000 | | | | — | | | | 24,500 | | | | 2,000 | |
| | | | |
Total Liabilities | | | 24,500,563 | | | | 2,613,834 | | | | 117,481,506 | | | | 699,005 | |
| | | | |
Net Assets | | $ | 274,549,739 | | | $ | 28,575,464 | | | $ | 1,222,306,521 | | | $ | 24,672,147 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 315,628,424 | | | $ | 47,053,815 | | | $ | 1,434,834,992 | | | $ | 36,124,837 | |
Distributable earnings (loss) | | | (41,078,685 | ) | | | (18,478,351 | ) | | | (212,528,471 | ) | | | (11,452,690 | ) |
| | | | |
Net Assets | | $ | 274,549,739 | | | $ | 28,575,464 | | | $ | 1,222,306,521 | | | $ | 24,672,147 | |
| | | | |
| | | | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 6,050,001 | | | | 750,001 | | | | 31,550,001 | | | | 650,000 | |
Net Asset Value | | $ | 45.38 | | | $ | 38.10 | | | $ | 38.74 | | | $ | 37.96 | |
| | | | |
† Securities on loan, at value | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
†† Cost of foreign cash | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 71 | |
Statements of Assets and Liabilities (cont.)
| | | | | | | | |
| | FlexShares® Ultra-Short Income Fund | | | FlexShares® Core Select Bond Fund | |
|
ASSETS | |
Securities, at cost | | $ | 1,072,642,754 | | | $ | 150,905,727 | |
Affiliate securities, at cost | | | — | | | | 48,573,769 | |
Securities Lending Reinvestments, at cost | | | — | | | | 80,325 | |
| | | | |
Securities, at value† | | | 1,069,254,268 | | | | 134,862,826 | |
Affiliate securities, at value | | | — | | | | 47,171,295 | |
Securities Lending Reinvestments, at value | | | — | | | | 80,325 | |
Cash | | | 21,785,475 | | | | 500,987 | |
Cash segregated at broker* | | | — | | | | 30,288 | |
Foreign cash†† | | | — | | | | — | |
Unrealized appreciation on forward foreign currency contracts | | | — | | | | — | |
Receivables: | | | — | | | | — | |
Dividends and interest | | | 7,100,320 | | | | — | |
Securities lending income | | | — | | | | 1,207 | |
Capital shares issued | | | — | | | | — | |
Investment adviser | | | 3,133 | | | | 808 | |
Securities sold | | | — | | | | 1,524,606 | |
Variation margin on futures contracts | | | — | | | | — | |
| | | | |
Total Assets | �� | | 1,098,143,196 | | | | 184,172,342 | |
| | | | |
|
LIABILITIES | |
Cash overdraft | | | — | | | | — | |
Unrealized depreciation on forward foreign currency contracts | | | — | | | | — | |
Payables: | | | | | | | | |
Cash collateral received from securities loaned | | | — | | | | 80,325 | |
Deferred compensation (Note 7) | | | 43,881 | | | | 8,287 | |
Investment advisory fees (Note 4) | | | 226,882 | | | | 55,310 | |
Trustee fees (Note 7) | | | 6,119 | | | | 1,264 | |
Securities purchased | | | 21,475,311 | | | | — | |
Deferred non-US capital gains taxes | | | — | | | | — | |
Due to Authorized Participant | | | — | | | | — | |
Variation margin on futures contracts | | | — | | | | 37,055 | |
Capital shares redeemed | | | — | | | | 1,559,238 | |
Other | | | 1,925 | | | | — | |
| | | | |
Total Liabilities | | | 21,754,118 | | | | 1,741,479 | |
| | | | |
Net Assets | | $ | 1,076,389,078 | | | $ | 182,430,863 | |
| | | | |
|
NET ASSETS CONSIST OF: | |
Paid-in capital | | $ | 1,075,994,186 | | | $ | 218,122,992 | |
Distributable earnings (loss) | | | 394,892 | | | | (35,692,129 | ) |
| | | | |
Net Assets | | $ | 1,076,389,078 | | | $ | 182,430,863 | |
| | | | |
| | |
Shares Outstanding (unlimited number of shares authorized $ 0.0001 par value) | | | 14,330,001 | | | | 8,775,001 | |
Net Asset Value | | $ | 75.11 | | | $ | 20.79 | |
| | |
† Securities on loan, at value | | $ | — | | | $ | 12,937,865 | |
†† Cost of foreign cash | | $ | — | | | $ | — | |
* | Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/23. |
See Accompanying Notes to the Financial Statements.
| | | | |
72 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Trust
Statements of Operations
For the year ended October 31, 2023
| | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Low Volatility Index Fund | | | FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | | | FlexShares® Emerging Markets Quality Low Volatility Index Fund | | | FlexShares® Morningstar US Market Factor Tilt Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 3,483,589 | | | $ | 2,497,047 | | | $ | 625,262 | | | $ | 25,401,167 | |
Income from non-cash dividends | | | — | | | | 125,957 | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | 19,468 | |
Interest income | | | 3,542 | | | | — | | | | 1,413 | | | | — | |
Securities lending income (net of fees) (Note 2) | | | 16,398 | | | | 14,422 | | | | — | | | | 748,875 | |
Foreign withholding tax on dividends | | | (6,941 | ) | | | (238,253 | ) | | | (66,575 | ) | | | (12,119 | ) |
Foreign withholding tax on interest | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investment Income | | | 3,496,588 | | | | 2,399,173 | | | | 560,100 | | | | 26,157,391 | |
| | | | |
|
EXPENSES | |
Deferred compensation (Note 7) | | | 1,755 | | | | 735 | | | | 128 | | | | 14,333 | |
Investment advisory fees | | | 399,546 | | | | 234,875 | | | | 59,599 | | | | 3,564,943 | |
Trustee fees (Note 7) | | | 13,356 | | | | 5,529 | | | | 1,117 | | | | 106,872 | |
Other expenses (Note 4) | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 414,657 | | | | 241,139 | | | | 60,844 | | | | 3,686,148 | |
| | | | |
|
Less: | |
Investment advisory fees reimbursed (Note 4) | | | (6,191 | ) | | | (2,620 | ) | | | (515 | ) | | | (50,967 | ) |
| | | | |
Total Net Expenses | | | 408,466 | | | | 238,519 | | | | 60,329 | | | | 3,635,181 | |
| | | | |
Net Investment Income (Loss) | | | 3,088,122 | | | | 2,160,654 | | | | 499,771 | | | | 22,522,210 | |
| | | | |
|
NET REALIZED GAIN (LOSS) FROM: | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | (27,260 | ) |
Transactions in investment securities | | | (7,143,809 | ) | | | (1,372,962 | ) | | | (396,042 | )(1) | | | (24,155,740 | ) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | 10,777 | |
In-kind redemptions on investments in securities | | | 11,134,030 | | | | 950,797 | | | | (2,860 | ) | | | 68,199,579 | |
Expiration or closing of futures contracts | | | 82,116 | | | | 202,228 | | | | (5,586 | ) | | | 292,338 | |
Settlement of forward foreign currency contracts | | | — | | | | (1,334 | ) | | | (8 | ) | | | — | |
Foreign currency transactions | | | — | | | | 4,617 | | | | (37,558 | ) | | | — | |
| | | | |
Net Realized Gain (Loss) | | | 4,072,337 | | | | (216,654 | ) | | | (442,054 | ) | | | 44,319,694 | |
| | | | |
|
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | |
Investments in unaffiliated securities | | | 325,198 | | | | 4,899,856 | | | | 362,558 | (2) | | | 16,612,800 | |
Investments in affiliated securities | | | — | | | | — | | | | — | | | | (110,312 | ) |
Securities lending | | | — | | | | — | | | | — | | | | 16,008 | |
Futures contracts | | | (4,832 | ) | | | (36,753 | ) | | | (4,868 | ) | | | (1,016,036 | ) |
Forward foreign currency contracts | | | — | | | | (5,891 | ) | | | — | | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | — | | | | 15,682 | | | | 1,036 | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 320,366 | | | | 4,872,894 | | | | 358,726 | | | | 15,502,460 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 4,392,703 | | | | 4,656,240 | | | | (83,328 | ) | | | 59,822,154 | |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 7,480,825 | | | $ | 6,816,894 | | | $ | 416,443 | | | $ | 82,344,364 | |
| | | | |
(1) | Net of non-US capital gains tax of $18,661. |
(2) | Net of deferred non-US capital gains tax of $20,095. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 73 | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | | | FlexShares® US Quality Large Cap Index Fund | | | FlexShares® STOXX® US ESG Select Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 19,128,162 | | | $ | 8,893,222 | | | $ | 2,269,040 | | | $ | 2,799,817 | |
Income from non-cash dividends | | | — | | | | 435,726 | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | 2,449 | |
Interest income | | | — | | | | 16,242 | | | | — | | | | — | |
Securities lending income (net of fees) (Note 2) | | | 470,436 | | | | 131,089 | | | | 8,292 | | | | 7,363 | |
Foreign withholding tax on dividends | | | (1,821,129 | ) | | | (1,098,147 | ) | | | — | | | | — | |
Foreign withholding tax on interest | | | — | | | | (8 | ) | | | — | | | | — | |
| | | | |
Total Investment Income | | | 17,777,469 | | | | 8,378,124 | | | | 2,277,332 | | | | 2,809,629 | |
| | | | |
| | | | |
EXPENSES | | | | | | | | | | | | | | | | |
Deferred compensation (Note 7) | | | 5,144 | | | | 2,327 | | | | 1,293 | | | | 1,720 | |
Investment advisory fees | | | 2,016,539 | | | | 1,388,377 | | | | 335,673 | | | | 551,704 | |
Trustee fees (Note 7) | | | 38,626 | | | | 17,571 | | | | 9,802 | | | | 12,924 | |
Other expenses (Note 4) | | | 3,381 | | | | 21,119 | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 2,063,690 | | | | 1,429,394 | | | | 346,768 | | | | 566,348 | |
| | | | |
| | | | |
Less: | | | | | | | | | | | | | | | | |
Investment advisory fees reimbursed (Note 4) | | | (21,291 | ) | | | (45,848 | ) | | | (4,459 | ) | | | (6,051 | ) |
| | | | |
Total Net Expenses | | | 2,042,399 | | | | 1,383,546 | | | | 342,309 | | | | 560,297 | |
| | | | |
Net Investment Income (Loss) | | | 15,735,070 | | | | 6,994,578 | | | | 1,935,023 | | | | 2,249,332 | |
| | | | |
| | | | |
NET REALIZED GAIN (LOSS) FROM: | | | | | | | | | | | | | | | | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | (7,201 | ) |
Transactions in investment securities | | | (10,341,168 | ) | | | (7,087,688 | )(1) | | | (2,857,571 | ) | | | (861,087 | ) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | (266 | ) |
In-kind redemptions on investments in securities | | | 4,871,522 | | | | 384,978 | | | | 3,349,919 | | | | 7,404,431 | |
Expiration or closing of futures contracts | | | 1,184,364 | | | | (15,728 | ) | | | 20,757 | | | | 112,767 | |
Settlement of forward foreign currency contracts | | | (47,567 | ) | | | 18,704 | | | | — | | | | — | |
Foreign currency transactions | | | 70,392 | | | | (343,019 | ) | | | — | | | | — | |
| | | | |
Net Realized Gain (Loss) | | | (4,262,457 | ) | | | (7,042,753 | ) | | | 513,105 | | | | 6,648,644 | |
| | | | |
| | | | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities | | | 49,637,108 | | | | 27,389,253 | (2) | | | 8,250,292 | | | | 10,548,192 | |
Investments in affiliated securities | | | — | | | | — | | | | — | | | | (17,217 | ) |
Securities lending | | | — | | | | — | | | | — | | | | — | |
Futures contracts | | | (391,983 | ) | | | 125,329 | | | | (17,315 | ) | | | (80,050 | ) |
Forward foreign currency contracts | | | 21,599 | | | | 1,326 | | | | — | | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | 172,194 | | | | 59,719 | | | | — | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 49,438,918 | | | | 27,575,627 | | | | 8,232,977 | | | | 10,450,925 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 45,176,461 | | | | 20,532,874 | | | | 8,746,082 | | | | 17,099,569 | |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 60,911,531 | | | $ | 27,527,452 | | | $ | 10,681,105 | | | $ | 19,348,901 | |
| | | | |
(1) | Net of non-US capital gains tax of $239,046. |
(2) | Net of deferred non-US capital gains tax of $1,069,681. |
See Accompanying Notes to the Financial Statements.
| | | | |
74 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® Global ESG Select Index Fund | | | FlexShares® ESG & Climate US Large Cap Core Index Fund | | | FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | | FlexShares® ESG & Climate Emerging Markets Core Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 3,724,221 | | | $ | 534,743 | | | $ | 1,232,134 | | | $ | 128,645 | |
Income from non-cash dividends | | | — | | | | — | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | — | |
Interest income | | | — | | | | 1,195 | | | | — | | | | — | |
Securities lending income (net of fees) (Note 2) | | | 18,246 | | | | — | | | | — | | | | — | |
Foreign withholding tax on dividends | | | (223,585 | ) | | | (258 | ) | | | (125,217 | ) | | | (18,455 | ) |
Foreign withholding tax on interest | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investment Income | | | 3,518,882 | | | | 535,680 | | | | 1,106,917 | | | | 110,190 | |
| | | | |
|
EXPENSES | |
Deferred compensation (Note 7) | | | 1,563 | | | | 272 | | | | 293 | | | | 45 | |
Investment advisory fees | | | 656,624 | | | | 28,256 | | | | 41,277 | | | | 8,066 | |
Trustee fees (Note 7) | | | 11,717 | | | | 2,197 | | | | 2,406 | | | | 350 | |
Other expenses (Note 4) | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 669,904 | | | | 30,725 | | | | 43,976 | | | | 8,461 | |
| | | | |
|
Less: | |
Investment advisory fees reimbursed (Note 4) | | | (5,417 | ) | | | (927 | ) | | | (1,012 | ) | | | (173 | ) |
| | | | |
Total Net Expenses | | | 664,487 | | | | 29,798 | | | | 42,964 | | | | 8,288 | |
| | | | |
Net Investment Income (Loss) | | | 2,854,395 | | | | 505,882 | | | | 1,063,953 | | | | 101,902 | |
| | | | |
|
NET REALIZED GAIN (LOSS) FROM: | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | — | |
Transactions in investment securities | | | (1,349,624 | ) | | | (399,518 | ) | | | (1,289,113 | ) | | | (175,668 | )(1) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
In-kind redemptions on investments in securities | | | 3,774,231 | | | | 358,040 | | | | — | | | | — | |
Expiration or closing of futures contracts | | | 140,996 | | | | 23,434 | | | | 34,251 | | | | (1,316 | ) |
Settlement of forward foreign currency contracts | | | 957 | | | | — | | | | 343 | | | | 7 | |
Foreign currency transactions | | | 8,247 | | | | — | | | | (12,117 | ) | | | (5,294 | ) |
| | | | |
Net Realized Gain (Loss) | | | 2,574,807 | | | | (18,044 | ) | | | (1,266,636 | ) | | | (182,271 | ) |
| | | | |
| | | | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities | | | 14,843,615 | | | | 2,089,029 | | | | 1,681,403 | | | | 513,921 | |
Investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
Securities lending | | | — | | | | — | | | | — | | | | — | |
Futures contracts | | | (54,222 | ) | | | (12,103 | ) | | | (16,718 | ) | | | 3,300 | |
Forward foreign currency contracts | | | 3,160 | | | | — | | | | 408 | | | | 3 | |
Translation of other assets and liabilities denominated in foreign currencies | | | 14,108 | | | | — | | | | (4,452 | ) | | | 310 | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 14,806,661 | | | | 2,076,926 | | | | 1,660,641 | | | | 517,534 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 17,381,468 | | | | 2,058,882 | | | | 394,005 | | | | 335,263 | |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 20,235,863 | | | $ | 2,564,764 | | | $ | 1,457,958 | | | $ | 437,165 | |
| | | | |
(1) | Net of non-US capital gains tax of $432. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 75 | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | FlexShares® STOXX® Global Broad Infrastructure Index Fund | | | FlexShares® Global Quality Real Estate Index Fund | | | FlexShares® Real Assets Allocation Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 303,850,295 | | | $ | 78,759,280 | | | $ | 10,952,298 | | | $ | — | |
Income from non-cash dividends | | | — | | | | — | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | 532,845 | |
Interest income | | | — | | | | 55,626 | | | | — | | | | — | |
Securities lending income (net of fees) (Note 2) | | | 2,505,995 | | | | 908,051 | | | | 60,398 | | | | — | |
Foreign withholding tax on dividends | | | (17,078,398 | ) | | | (5,143,864 | ) | | | (523,558 | ) | | | — | |
Foreign withholding tax on interest | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investment Income | | | 289,277,892 | | | | 74,579,093 | | | | 10,489,138 | | | | 532,845 | |
| | | | |
| | | | |
EXPENSES | | | | | | | | | | | | | | | | |
Deferred compensation (Note 7) | | | 74,311 | | | | 24,745 | | | | 3,362 | | | | 232 | |
Investment advisory fees | | | 33,743,024 | | | | 10,896,769 | | | | 1,435,405 | | | | 118,048 | |
Administration fees (Note 5) | | | — | | | | — | | | | 1,573 | | | | — | |
Trustee fees (Note 7) | | | 545,297 | | | | 179,574 | | | | 24,562 | | | | 1,706 | |
Other expenses (Note 4) | | | 56,856 | | | | — | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 34,419,488 | | | | 11,101,088 | | | | 1,464,902 | | | | 119,986 | |
| | | | |
|
Less: | |
Investment advisory fees reimbursed (Note 4) | | | (322,945 | ) | | | (90,757 | ) | | | (14,271 | ) | | | (98,833 | ) |
| | | | |
Total Net Expenses | | | 34,096,543 | | | | 11,010,331 | | | | 1,450,631 | | | | 21,153 | |
| | | | |
Net Investment Income (Loss) | | | 255,181,349 | | | | 63,568,762 | | | | 9,038,507 | | | | 511,692 | |
| | | | |
|
NET REALIZED GAIN (LOSS) FROM: | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | (574,000 | ) |
Transactions in investment securities | | | 26,611,649 | (1) | | | (60,907,295 | )(2) | | | (30,195,487 | ) | | | — | |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | (1,193,639 | ) |
In-kind redemptions on investments in securities | | | 13,171,091 | | | | 118,182,191 | | | | 3,452,008 | | | | — | |
Expiration or closing of futures contracts | | | (1,699,233 | ) | | | 1,789,383 | | | | 425,518 | | | | — | |
Settlement of forward foreign currency contracts | | | (492,100 | ) | | | 53,105 | | | | 112,370 | | | | — | |
Foreign currency transactions | | | (297,240 | ) | | | (351,195 | ) | | | 2,470 | | | | — | |
| | | | |
Net Realized Gain (Loss) | | | 37,294,167 | | | | 58,766,189 | | | | (26,203,121 | ) | | | (1,767,639 | ) |
| | | | |
|
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | |
Investments in unaffiliated securities | | | (603,501,036 | ) | | | (59,229,140 | )(3) | | | (2,528,412 | ) | | | — | |
Investments in affiliated securities | | | — | | | | — | | | | — | | | | 1,536,542 | (4) |
Securities lending | | | 14,613 | | | | — | | | | — | | | | — | |
Futures contracts | | | (1,694,521 | ) | | | (921,993 | ) | | | (187,225 | ) | | | — | |
Forward foreign currency contracts | | | 266,510 | | | | 112,999 | | | | (16,487 | ) | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | (107,065 | ) | | | 104,982 | | | | 16,041 | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | (605,021,499 | ) | | | (59,933,152 | ) | | | (2,716,083 | ) | | | 1,536,542 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | (567,727,332 | ) | | | (1,166,963 | ) | | | (28,919,204 | ) | | | (231,097 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | (312,545,983 | ) | | $ | 62,401,799 | | | $ | (19,880,697 | ) | | $ | 280,595 | |
| | | | |
(1) | Net of non-US capital gains tax of $306. |
(2) | Net of non-US capital gains tax of $544,794. |
(3) | Net of deferred non-US capital gains tax of $467,278. |
See Accompanying Notes to the Financial Statements.
| | | | |
76 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Quality Dividend Index Fund | | | FlexShares® Quality Dividend Defensive Index Fund | | | FlexShares® International Quality Dividend Index Fund | | | FlexShares® International Quality Dividend Defensive Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 43,558,447 | | | $ | 9,322,276 | | | $ | 33,308,880 | | | $ | 1,851,409 | |
Income from non-cash dividends | | | — | | | | — | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | — | |
Interest income | | | — | | | | — | | | | — | | | | — | |
Securities lending income (net of fees) (Note 2) | | | 1,121,444 | | | | 218,965 | | | | 261,483 | | | | 14,727 | |
Foreign withholding tax on dividends | | | (656,478 | ) | | | (147,831 | ) | | | (3,864,449 | ) | | | (191,639 | ) |
Foreign withholding tax on interest | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investment Income | | | 44,023,413 | | | | 9,393,410 | | | | 29,705,914 | | | | 1,674,497 | |
| | | | |
|
EXPENSES | |
Deferred compensation (Note 7) | | | 15,772 | | | | 3,500 | | | | 5,125 | | | | 372 | |
Investment advisory fees | | | 5,758,194 | | | | 1,253,222 | | | | 2,485,060 | | | | 152,814 | |
Trustee fees (Note 7) | | | 116,387 | | | | 25,461 | | | | 38,858 | | | | 2,619 | |
Other expenses (Note 4) | | | — | | | | — | | | | 44,638 | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 5,890,353 | | | | 1,282,183 | | | | 2,573,681 | | | | 155,805 | |
| | | | |
|
Less: | |
Investment advisory fees reimbursed (Note 4) | | | (55,150 | ) | | | (12,200 | ) | | | (62,037 | ) | | | (1,348 | ) |
| | | | |
Total Net Expenses | | | 5,835,203 | | | | 1,269,983 | | | | 2,511,644 | | | | 154,457 | |
| | | | |
Net Investment Income (Loss) | | | 38,188,210 | | | | 8,123,427 | | | | 27,194,270 | | | | 1,520,040 | |
| | | | |
|
NET REALIZED GAIN (LOSS) FROM: | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | — | |
Transactions in investment securities | | | (92,662,836 | ) | | | (10,859,478 | ) | | | (14,259,749 | )(1) | | | (1,098,205 | )(2) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
In-kind redemptions on investments in securities | | | 152,543,538 | | | | 26,282,096 | | | | 3,130,154 | | | | 1,103,875 | |
Expiration or closing of futures contracts | | | 357,938 | | | | 154,895 | | | | 926,785 | | | | 68,091 | |
Settlement of forward foreign currency contracts | | | — | | | | — | | | | (74,191 | ) | | | (41,670 | ) |
Foreign currency transactions | | | — | | | | — | | | | (120,659 | ) | | | (12,764 | ) |
| | | | |
Net Realized Gain (Loss) | | | 60,238,640 | | | | 15,577,513 | | | | (10,397,660 | ) | | | 19,327 | |
| | | | |
| | | | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities | | | 3,681,484 | | | | 2,034,842 | | | | 58,195,156 | (3) | | | 3,826,375 | (4) |
Securities lending | | | 7,965 | | | | — | | | | — | | | | — | |
Futures contracts | | | (101,537 | ) | | | (31,829 | ) | | | (180,632 | ) | | | (41,044 | ) |
Forward foreign currency contracts | | | — | | | | — | | | | 93,106 | | | | (18,270 | ) |
Translation of other assets and liabilities denominated in foreign currencies | | | — | | | | — | | | | 101,623 | | | | 16,509 | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 3,587,912 | | | | 2,003,013 | | | | 58,209,253 | | | | 3,783,570 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 63,826,552 | | | | 17,580,526 | | | | 47,811,593 | | | | 3,802,897 | |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 102,014,762 | | | $ | 25,703,953 | | | $ | 75,005,863 | | | $ | 5,322,937 | |
| | | | |
(1) | Net of non-US capital gains tax of $456,107. |
(2) | Net of non-US capital gains tax of $533. |
(3) | Net of deferred non-US capital gains tax of $574,995. |
(4) | Net of deferred non-US capital gains tax of $1,768. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 77 | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Dynamic Index Fund | | | FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | | | FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund | | | FlexShares® Disciplined Duration MBS Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | 5,371,014 | | | $ | — | | | $ | — | | | $ | — | |
Income from non-cash dividends | | | — | | | | — | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | — | |
Interest income | | | — | | | | 84,496,641 | | | | 31,719,995 | | | | 2,376,090 | |
Securities lending income (net of fees) (Note 2) | | | 39,993 | | | | 22,418 | | | | 37,494 | | | | — | |
Foreign withholding tax on dividends | | | (635,023 | ) | | | — | | | | — | | | | — | |
Foreign withholding tax on interest | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investment Income | | | 4,775,984 | | | | 84,519,059 | | | | 31,757,489 | | | | 2,376,090 | |
| | | | |
|
EXPENSES | |
Deferred compensation (Note 7) | | | 882 | | | | 20,699 | | | | 6,962 | | | | 914 | |
Investment advisory fees | | | 412,971 | | | | 3,566,309 | | | | 1,283,920 | | | | 163,535 | |
Trustee fees (Note 7) | | | 6,874 | | | | 150,333 | | | | 51,916 | | | | 6,496 | |
Other expenses (Note 4) | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 420,727 | | | | 3,737,341 | | | | 1,342,798 | | | | 170,945 | |
| | | | |
|
Less: | |
Investment advisory fees reimbursed (Note 4) | | | (3,318 | ) | | | (74,099 | ) | | | (24,059 | ) | | | (3,410 | ) |
| | | | |
Total Net Expenses | | | 417,409 | | | | 3,663,242 | | | | 1,318,739 | | | | 167,535 | |
| | | | |
Net Investment Income (Loss) | | | 4,358,575 | | | | 80,855,817 | | | | 30,438,750 | | | | 2,208,555 | |
| | | | |
|
NET REALIZED GAIN (LOSS) FROM: | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | — | |
Transactions in investment securities | | | (4,515,937 | )(1) | | | (65,630,974 | ) | | | (34,032,343 | ) | | | (3,912,271 | ) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
In-kind redemptions on investments in securities | | | 4,726,915 | | | | (4,342,963 | ) | | | 394,493 | | | | — | |
Expiration or closing of futures contracts | | | 234,106 | | | | — | | | | — | | | | — | |
Settlement of forward foreign currency contracts | | | (4,559 | ) | | | — | | | | — | | | | — | |
Foreign currency transactions | | | (26,497 | ) | | | — | | | | — | | | | — | |
| | | | |
Net Realized Gain (Loss) | | | 414,028 | | | | (69,973,937 | ) | | | (33,637,850 | ) | | | (3,912,271 | ) |
| | | | |
| | | | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities | | | 9,195,011 | (2) | | | 26,655,120 | | | | 1,002,375 | | | | 3,495,416 | |
Securities lending | | | — | | | | — | | | | — | | | | — | |
Futures contracts | | | (24,231 | ) | | | — | | | | — | | | | — | |
Forward foreign currency contracts | | | (6,064 | ) | | | — | | | | — | | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | 5,958 | | | | — | | | | — | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 9,170,674 | | | | 26,655,120 | | | | 1,002,375 | | | | 3,495,416 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 9,584,702 | | | | (43,318,817 | ) | | | (32,635,475 | ) | | | (416,855 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 13,943,277 | | | $ | 37,537,000 | | | $ | (2,196,725 | ) | | $ | 1,791,700 | |
| | | | |
(1) | Net of non-US capital gains tax of $53,469. |
(2) | Net of deferred non-US capital gains tax of $147,073. |
See Accompanying Notes to the Financial Statements.
| | | | |
78 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Operations (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Credit-Scored US Corporate Bond Index Fund | | | FlexShares® Credit-Scored US Long Corporate Bond Index Fund | | | FlexShares® High Yield Value-Scored Bond Index Fund | | | FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
Income from non-cash dividends | | | — | | | | — | | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | — | | | | — | | | | — | |
Interest income | | | 9,866,877 | | | | 1,761,884 | | | | 100,562,917 | | | | 1,372,483 | |
Securities lending income (net of fees) (Note 2) | | | — | | | | — | | | | — | | | | — | |
Foreign withholding tax on dividends | | | — | | | | — | | | | — | | | | — | |
Foreign withholding tax on interest | | | — | | | | — | | | | (47,362 | ) | | | — | |
| | | | |
Total Investment Income | | | 9,866,877 | | | | 1,761,884 | | | | 100,515,555 | | | | 1,372,483 | |
| | | | |
| | | | |
EXPENSES | | | | | | | | | | | | | | | | |
Deferred compensation (Note 7) | | | 2,438 | | | | 359 | | | | 10,094 | | | | 310 | |
Investment advisory fees | | | 547,702 | | | | 73,984 | | | | 4,010,051 | | | | 39,929 | |
Trustee fees (Note 7) | | | 18,203 | | | | 2,648 | | | | 77,019 | | | | 2,580 | |
Other expenses (Note 4) | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 568,343 | | | | 76,991 | | | | 4,097,164 | | | | 42,819 | |
| | | | |
| | | | |
Less: | | | | | | | | | | | | | | | | |
Investment advisory fees reimbursed (Note 4) | | | (8,442 | ) | | | (3,529 | ) | | | (119,275 | ) | | | (1,263 | ) |
| | | | |
Total Net Expenses | | | 559,901 | | | | 73,462 | | | | 3,977,889 | | | | 41,556 | |
| | | | |
Net Investment Income (Loss) | | | 9,306,976 | | | | 1,688,422 | | | | 96,537,666 | | | | 1,330,927 | |
| | | | |
| | | | |
NET REALIZED GAIN (LOSS) FROM: | | | | | | | | | | | | | | | | |
Transactions in investment securities of affiliated issuers | | | — | | | | — | | | | — | | | | — | |
Transactions in investment securities | | | (16,010,333 | ) | | | (7,142,718 | ) | | | (73,703,129 | ) | | | (2,757,523 | ) |
In-kind redemptions on investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
In-kind redemptions on investments in securities | | | — | | | | — | | | | — | | | | — | |
Expiration or closing of futures contracts | | | — | | | | — | | | | — | | | | — | |
Settlement of forward foreign currency contracts | | | — | | | | — | | | | — | | | | — | |
Foreign currency transactions | | | — | | | | — | | | | — | | | | — | |
| | | | |
Net Realized Gain (Loss) | | | (16,010,333 | ) | | | (7,142,718 | ) | | | (73,703,129 | ) | | | (2,757,523 | ) |
| | | | |
| | | | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities | | | 15,511,584 | | | | 6,730,934 | | | | 27,158,390 | | | | 1,697,139 | |
Investments in affiliated securities | | | — | | | | — | | | | — | | | | — | |
Securities lending | | | — | | | | — | | | | — | | | | — | |
Futures contracts | | | — | | | | — | | | | — | | | | — | |
Forward foreign currency contracts | | | — | | | | — | | | | — | | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | — | | | | — | | | | — | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 15,511,584 | | | | 6,730,934 | | | | 27,158,390 | | | | 1,697,139 | |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | (498,749 | ) | | | (411,784 | ) | | | (46,544,739 | ) | | | (1,060,384 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 8,808,227 | | | $ | 1,276,638 | | | $ | 49,992,927 | | | $ | 270,543 | |
| | | | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 79 | |
Statements of Operations (cont.)
| | | | | | | | |
| | FlexShares® Ultra-Short Income Fund | | | FlexShares® Core Select Bond Fund | |
|
INVESTMENT INCOME | |
Dividend income | | $ | — | | | $ | 4,175,668 | |
Income from non-cash dividends | | | — | | | | — | |
Dividend income received from affiliate | | | — | | | | 1,698,833 | |
Interest income | | | 43,894,643 | | | | 20,770 | |
Securities lending income (net of fees) (Note 2) | | | — | | | | 60,907 | |
Foreign withholding tax on dividends | | | — | | | | — | |
Foreign withholding tax on interest | | | — | | | | — | |
| | | | |
Total Investment Income | | | 43,894,643 | | | | 5,956,178 | |
| | | | |
| | |
EXPENSES | | | | | | | | |
Deferred compensation (Note 7) | | | 9,162 | | | | 1,771 | |
Investment advisory fees | | | 2,391,804 | | | | 646,164 | |
Trustee fees (Note 7) | | | 68,480 | | | | 13,518 | |
Other expenses (Note 4) | | | — | | | | — | |
| | | | |
Total Gross Expenses Before Fees Reimbursed | | | 2,469,446 | | | | 661,453 | |
| | | | |
| | |
Less: | | | | | | | | |
Investment advisory fees reimbursed (Note 4) | | | (30,684 | ) | | | (200,471 | ) |
| | | | |
Total Net Expenses | | | 2,438,762 | | | | 460,982 | |
| | | | |
Net Investment Income (Loss) | | | 41,455,881 | | | | 5,495,196 | |
| | | | |
| | |
NET REALIZED GAIN (LOSS) FROM: | | | | | | | | |
Transactions in investment securities of affiliated issuers | | | — | | | | (1,126,110 | ) |
Transactions in investment securities | | | 14,152 | | | | (2,046,267 | ) |
In-kind redemptions on investments in affiliated securities | | | — | | | | 25,550 | |
In-kind redemptions on investments in securities | | | — | | | | 103,017 | |
Expiration or closing of futures contracts | | | — | | | | (145,963 | ) |
Settlement of forward foreign currency contracts | | | — | | | | — | |
Foreign currency transactions | | | — | | | | — | |
| | | | |
Net Realized Gain (Loss) | | | 14,152 | | | | (3,189,773 | ) |
| | | | |
| | |
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: | | | | | | | | |
Investments in unaffiliated securities | | | 7,484,444 | | | | (5,423,104 | ) |
Investments in affiliated securities | | | — | | | | 1,535,186 | |
Securities lending | | | — | | | | — | |
Futures contracts | | | — | | | | (33,289 | ) |
Forward foreign currency contracts | | | — | | | | — | |
Translation of other assets and liabilities denominated in foreign currencies | | | — | | | | — | |
| | | | |
Net Change in Unrealized Appreciation (Depreciation) | | | 7,484,444 | | | | (3,921,207 | ) |
| | | | |
Net Realized and Unrealized Gain (Loss) | | | 7,498,596 | | | | (7,110,980 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | $ | 48,954,477 | | | $ | (1,615,784 | ) |
| | | | |
See Accompanying Notes to the Financial Statements.
| | | | |
80 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Trust
Statements of Changes in Net Assets
| | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Low Volatility Index Fund | | | FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 3,088,122 | | | $ | 2,565,712 | | | $ | 2,160,654 | | | $ | 1,827,612 | |
Net realized gain (loss) | | | 4,072,337 | | | | 4,986,550 | | | | (216,654 | ) | | | (2,233,170 | ) |
Net change in unrealized appreciation (depreciation) | | | 320,366 | | | | (19,711,109 | ) | | | 4,872,894 | | | | (13,557,671 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 7,480,825 | | | | (12,158,847 | ) | | | 6,816,894 | | | | (13,963,229 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (3,156,833 | ) | | | (2,196,287 | ) | | | (2,014,225 | ) | | | (2,140,729 | ) |
| | | | |
Total distributions | | | (3,156,833 | ) | | | (2,196,287 | ) | | | (2,014,225 | ) | | | (2,140,729 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 69,071,863 | | | | 51,896,738 | | | | 7,306,967 | | | | 10,600,255 | |
Cost of shares redeemed | | | (50,959,758 | ) | | | (36,047,573 | ) | | | (7,698,033 | ) | | | (8,015,506 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 18,112,105 | | | | 15,849,165 | | | | (391,066 | ) | | | 2,584,749 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 22,436,097 | | | | 1,494,031 | | | | 4,411,603 | | | | (13,519,209 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 162,568,523 | | | $ | 161,074,492 | | | $ | 61,851,748 | | | $ | 75,370,957 | |
| | | | |
End of Period | | $ | 185,004,620 | | | $ | 162,568,523 | | | $ | 66,263,351 | | | $ | 61,851,748 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 3,250,001 | | | | 2,950,001 | | | | 2,800,001 | | | | 2,700,001 | |
Shares issued | | | — | | | | — | | | | — | | | | 100,000 | |
Shares issued in-kind | | | 1,325,000 | | | | 1,000,000 | | | | 300,000 | | | | 300,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (975,000 | ) | | | (700,000 | ) | | | (300,000 | ) | | | (300,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 3,600,001 | | | | 3,250,001 | | | | 2,800,001 | | | | 2,800,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 81 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Emerging Markets Quality Low Volatility Index Fund | | | FlexShares® Morningstar US Market Factor Tilt Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 499,771 | | | $ | 388,332 | | | $ | 22,522,210 | | | $ | 22,502,916 | |
Net realized gain (loss) | | | (442,054 | ) | | | (866,287 | ) | | | 44,319,694 | | | | 68,387,164 | |
Net change in unrealized appreciation (depreciation) | | | 358,726 | | | | (2,322,376 | ) | | | 15,502,460 | | | | (329,620,719 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 416,443 | | | | (2,800,331 | ) | | | 82,344,364 | | | | (238,730,639 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (436,593 | ) | | | (416,284 | ) | | | (21,821,054 | ) | | | (22,299,297 | ) |
Tax return of capital | | | — | | | | (24,777 | ) | | | — | | | | — | |
| | | | |
Total distributions | | | (436,593 | ) | | | (441,061 | ) | | | (21,821,054 | ) | | | (22,299,297 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 9,401,694 | | | | — | | | | — | | | | 59,308,274 | |
Cost of shares redeemed | | | (4,615,590 | ) | | | (4,388,407 | ) | | | (121,919,751 | ) | | | (127,889,854 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 4,786,104 | | | | (4,388,407 | ) | | | (121,919,751 | ) | | | (68,581,580 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | 4,765,954 | | | | (7,629,799 | ) | | | (61,396,441 | ) | | | (329,611,516 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 8,213,892 | | | $ | 15,843,691 | | | $ | 1,397,407,502 | | | $ | 1,727,019,018 | |
| | | | |
End of Period | | $ | 12,979,846 | | | $ | 8,213,892 | | | $ | 1,336,011,061 | | | $ | 1,397,407,502 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 400,001 | | | | 600,001 | | | | 9,250,001 | | | | 9,650,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 400,000 | | | | — | | | | — | | | | 350,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (200,000 | ) | | | (200,000 | ) | | | (750,000 | ) | | | (750,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 600,001 | | | | 400,001 | | | | 8,500,001 | | | | 9,250,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
82 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 15,735,070 | | | $ | 16,741,670 | | | $ | 6,994,578 | | | $ | 9,809,271 | |
Net realized gain (loss) | | | (4,262,457 | ) | | | 1,512,421 | | | | (7,042,753 | ) | | | (13,258,134 | ) |
Net change in unrealized appreciation (depreciation) | | | 49,438,918 | | | | (161,673,906 | ) | | | 27,575,627 | | | | (79,920,628 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 60,911,531 | | | | (143,419,815 | ) | | | 27,527,452 | | | | (83,369,491 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (13,198,440 | ) | | | (22,504,833 | ) | | | (7,099,686 | ) | | | (12,431,512 | ) |
Tax return of capital | | | — | | | | (992,999 | ) | | | — | | | | — | |
| | | | |
Total distributions | | | (13,198,440 | ) | | | (23,497,832 | ) | | | (7,099,686 | ) | | | (12,431,512 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | — | | | | 14,617,000 | | | | 10,189,317 | | | | 10,793,304 | |
Cost of shares redeemed | | | (25,228,446 | ) | | | (49,583,666 | ) | | | (18,782,471 | ) | | | (42,475,383 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | (25,228,446 | ) | | | (34,966,666 | ) | | | (8,593,154 | ) | | | (31,682,079 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | 22,484,645 | | | | (201,884,313 | ) | | | 11,834,612 | | | | (127,483,082 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 446,754,180 | | | $ | 648,638,493 | | | $ | 206,888,913 | | | $ | 334,371,995 | |
| | | | |
End of Period | | $ | 469,238,825 | | | $ | 446,754,180 | | | $ | 218,723,525 | | | $ | 206,888,913 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 8,200,001 | | | | 8,800,001 | | | | 4,900,001 | | | | 5,500,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | — | | | | 200,000 | | | | 200,000 | | | | 200,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (400,000 | ) | | | (800,000 | ) | | | (400,000 | ) | | | (800,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 7,800,001 | | | | 8,200,001 | | | | 4,700,001 | | | | 4,900,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 83 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Large Cap Index Fund | | | FlexShares® STOXX® US ESG Select Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 1,935,023 | | | $ | 1,866,119 | | | $ | 2,249,332 | | | $ | 2,217,868 | |
Net realized gain (loss) | | | 513,105 | | | | 11,695,699 | | | | 6,648,644 | | | | 4,095,701 | |
Net change in unrealized appreciation (depreciation) | | | 8,232,977 | | | | (32,784,418 | ) | | | 10,450,925 | | | | (39,534,134 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 10,681,105 | | | | (19,222,600 | ) | | | 19,348,901 | | | | (33,220,565 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (1,897,433 | ) | | | (1,808,374 | ) | | | (2,147,796 | ) | | | (2,266,829 | ) |
| | | | |
Total distributions | | | (1,897,433 | ) | | | (1,808,374 | ) | | | (2,147,796 | ) | | | (2,266,829 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 26,273,873 | | | | 57,305,777 | | | | 7,197,512 | | | | 37,713,363 | |
Cost of shares redeemed | | | (15,601,493 | ) | | | (53,400,212 | ) | | | (29,453,795 | ) | | | (21,888,788 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 10,672,380 | | | | 3,905,565 | | | | (22,256,283 | ) | | | 15,824,575 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 19,456,052 | | | | (17,125,409 | ) | | | (5,055,178 | ) | | | (19,662,819 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 127,349,840 | | | $ | 144,475,249 | | | $ | 171,979,926 | | | $ | 191,642,745 | |
| | | | |
End of Period | | $ | 146,805,892 | | | $ | 127,349,840 | | | $ | 166,924,748 | | | $ | 171,979,926 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 2,950,001 | | | | 2,875,001 | | | | 1,850,001 | | | | 1,700,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 550,000 | | | | 1,300,000 | | | | 75,000 | | | | 350,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (350,000 | ) | | | (1,225,000 | ) | | | (300,000 | ) | | | (200,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 3,150,001 | | | | 2,950,001 | | | | 1,625,001 | | | | 1,850,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
84 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® Global ESG Select Index Fund | | | FlexShares® ESG & Climate US Large Cap Core Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 2,854,395 | | | $ | 2,805,170 | | | $ | 505,882 | | | $ | 162,899 | |
Net realized gain (loss) | | | 2,574,807 | | | | 3,353,319 | | | | (18,044 | ) | | | (133,446 | ) |
Net change in unrealized appreciation (depreciation) | | | 14,806,661 | | | | (41,798,644 | ) | | | 2,076,926 | | | | (2,180,219 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 20,235,863 | | | | (35,640,155 | ) | | | 2,564,764 | | | | (2,150,766 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (2,604,964 | ) | | | (3,114,461 | ) | | | (460,917 | ) | | | (129,697 | ) |
| | | | |
Total distributions | | | (2,604,964 | ) | | | (3,114,461 | ) | | | (460,917 | ) | | | (129,697 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | — | | | | 14,352,429 | | | | 13,970,255 | | | | 24,984,332 | |
Cost of shares redeemed | | | (12,740,756 | ) | | | (14,389,810 | ) | | | (1,281,601 | ) | | | (3,269,970 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | (12,740,756 | ) | | | (37,381 | ) | | | 12,688,654 | | | | 21,714,362 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 4,890,143 | | | | (38,791,997 | ) | | | 14,792,501 | | | | 19,433,899 | |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 146,925,477 | | | $ | 185,717,474 | | | $ | 22,103,385 | | | $ | 2,669,486 | |
| | | | |
End of Period | | $ | 151,815,620 | | | $ | 146,925,477 | | | $ | 36,895,886 | | | $ | 22,103,385 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 1,250,001 | | | | 1,250,001 | | | | 500,000 | | | | 50,000 | |
Shares issued | | | — | | | | 50,000 | | | | — | | | | — | |
Shares issued in-kind | | | — | | | | 50,000 | | | | 300,000 | | | | 525,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (100,000 | ) | | | (100,000 | ) | | | (25,000 | ) | | | (75,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 1,150,001 | | | | 1,250,001 | | | | 775,000 | | | | 500,000 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 85 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | | FlexShares® ESG & Climate Emerging Markets Core Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | April 20, 2022* through October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 1,063,953 | | | $ | 441,657 | | | $ | 101,902 | | | $ | 75,840 | |
Net realized gain (loss) | | | (1,266,636 | ) | | | (966,117 | ) | | | (182,271 | ) | | | (45,285 | ) |
Net change in unrealized appreciation (depreciation) | | | 1,660,641 | | | | (3,597,163 | ) | | | 517,534 | | | | (1,106,532 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 1,457,958 | | | | (4,121,623 | ) | | | 437,165 | | | | (1,075,977 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (958,970 | ) | | | (406,987 | ) | | | (104,863 | ) | | | (65,664 | ) |
| | | | |
Total distributions | | | (958,970 | ) | | | (406,987 | ) | | | (104,863 | ) | | | (65,664 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 19,816,298 | | | | 16,578,470 | | | | — | | | | — | |
Cost of shares redeemed | | | — | | | | — | | | | — | | | | — | |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 19,816,298 | | | | 16,578,470 | | | | — | | | | — | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 20,315,286 | | | | 12,049,860 | | | | 332,302 | | | | (1,141,641 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 17,168,920 | | | $ | 5,119,060 | | | $ | 3,867,735 | | | $ | 5,009,376 | (2),(3) |
| | | | |
End of Period | | $ | 37,484,206 | | | $ | 17,168,920 | | | $ | 4,200,037 | | | $ | 3,867,735 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 450,000 | | | | 100,000 | | | | 100,000 | | | | 100,000 | (2) |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 450,000 | | | | 350,000 | | | | — | | | | — | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | — | | | | — | | | | — | | | | — | |
| | | | |
Shares Outstanding, End of Period | | | 900,000 | | | | 450,000 | | | | 100,000 | | | | 100,000 | |
| | | | |
* | Commencement of investment operations. |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
(2) | Amount includes the initial subscription. |
(3) | Includes amounts paid in capital from the Authorized Participant in addition to the order’s original cash component. This amount is made to offset taxes, commissions, and price differences from the NAV that would otherwise impact the fund on these order trades. |
See Accompanying Notes to the Financial Statements.
| | | | |
86 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | FlexShares® STOXX® Global Broad Infrastructure Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 255,181,349 | | | $ | 326,558,353 | | | $ | 63,568,762 | | | $ | 64,519,296 | |
Net realized gain (loss) | | | 37,294,167 | | | | 543,920,180 | | | | 58,766,189 | | | | (34,284,707 | ) |
Net change in unrealized appreciation (depreciation) | | | (605,021,499 | ) | | | (257,516,529 | ) | | | (59,933,152 | ) | | | (413,573,085 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | (312,545,983 | ) | | | 612,962,004 | | | | 62,401,799 | | | | (383,338,496 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (217,789,649 | ) | | | (349,767,759 | ) | | | (54,907,766 | ) | | | (71,164,043 | ) |
| | | | |
Total distributions | | | (217,789,649 | ) | | | (349,767,759 | ) | | | (54,907,766 | ) | | | (71,164,043 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 660,926,417 | | | | 2,228,186,786 | | | | 12,129,246 | | | | 376,096,311 | |
Cost of shares redeemed | | | (40,156,731 | ) | | | (1,709,239,303 | ) | | | (494,960,229 | ) | | | (64,981,425 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 620,769,686 | | | | 518,947,483 | | | | (482,830,983 | ) | | | 311,114,886 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 90,434,054 | | | | 782,141,728 | | | | (475,336,950 | ) | | | (143,387,653 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 6,834,851,994 | | | $ | 6,052,710,266 | | | $ | 2,500,518,413 | | | $ | 2,643,906,066 | |
| | | | |
End of Period | | $ | 6,925,286,048 | | | $ | 6,834,851,994 | | | $ | 2,025,181,463 | | | $ | 2,500,518,413 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 165,300,001 | | | | 156,550,001 | | | | 51,750,001 | | | | 45,800,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 15,250,000 | | | | 51,400,000 | | | | 250,000 | | | | 7,100,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (950,000 | ) | | | (42,650,000 | ) | | | (9,600,000 | ) | | | (1,150,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 179,600,001 | | | | 165,300,001 | | | | 42,400,001 | | | | 51,750,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 87 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Global Quality Real Estate Index Fund | | | FlexShares® Real Assets Allocation Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 9,038,507 | | | $ | 10,527,149 | | | $ | 511,692 | | | $ | 1,052,524 | |
Net realized gain (loss) | | | (26,203,121 | ) | | | (1,205,777 | ) | | | (1,767,639 | ) | | | (347,185 | ) |
Net change in unrealized appreciation (depreciation) | | | (2,716,083 | ) | | | (112,605,358 | ) | | | 1,536,542 | | | | (6,504,289 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | (19,880,697 | ) | | | (103,283,986 | ) | | | 280,595 | | | | (5,798,950 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (8,872,134 | ) | | | (12,433,295 | ) | | | (512,404 | ) | | | (1,056,448 | ) |
Tax return of capital | | | — | | | | (212,283 | ) | | | — | | | | — | |
| | | | |
Total distributions | | | (8,872,134 | ) | | | (12,645,578 | ) | | | (512,404 | ) | | | (1,056,448 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 13,506,842 | | | | 61,391,019 | | | | 744,410 | | | | 31,091,126 | |
Cost of shares redeemed | | | (68,461,361 | ) | | | (35,678,157 | ) | | | (12,804,666 | ) | | | (25,670,798 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | (54,954,519 | ) | | | 25,712,862 | | | | (12,060,256 | ) | | | 5,420,328 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | (83,707,350 | ) | | | (90,216,702 | ) | | | (12,292,065 | ) | | | (1,435,070 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 328,380,681 | | | $ | 418,597,383 | | | $ | 28,864,616 | | | $ | 30,299,686 | |
| | | | |
End of Period | | $ | 244,673,331 | | | $ | 328,380,681 | | | $ | 16,572,551 | | | $ | 28,864,616 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 6,300,001 | | | | 5,950,001 | | | | 1,000,001 | | | | 900,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 250,000 | | | | 900,000 | | | | 25,000 | | | | 925,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (1,350,000 | ) | | | (550,000 | ) | | | (425,000 | ) | | | (825,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 5,200,001 | | | | 6,300,001 | | | | 600,001 | | | | 1,000,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
88 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Quality Dividend Index Fund | | | FlexShares® Quality Dividend Defensive Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 38,188,210 | | | $ | 36,130,232 | | | $ | 8,123,427 | | | $ | 8,686,945 | |
Net realized gain (loss) | | | 60,238,640 | | | | 74,523,974 | | | | 15,577,513 | | | | 35,613,228 | |
Net change in unrealized appreciation (depreciation) | | | 3,587,912 | | | | (248,957,784 | ) | | | 2,003,013 | | | | (74,967,194 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 102,014,762 | | | | (138,303,578 | ) | | | 25,703,953 | | | | (30,667,021 | ) |
| | | | |
| | | | |
DISTRIBUTIONS TO SHAREHOLDERS | | | | | | | | | | | | | | | | |
Distributable earnings | | | (36,041,105 | ) | | | (36,901,147 | ) | | | (7,830,976 | ) | | | (9,019,363 | ) |
| | | | |
Total distributions | | | (36,041,105 | ) | | | (36,901,147 | ) | | | (7,830,976 | ) | | | (9,019,363 | ) |
| | | | |
| | | | |
CAPITAL TRANSACTIONS(1) | | | | | | | | | | | | | | | | |
Proceeds from shares issued | | | 481,283,890 | | | | 512,092,494 | | | | 57,240,190 | | | | 100,491,773 | |
Cost of shares redeemed | | | (608,656,345 | ) | | | (456,702,830 | ) | | | (107,325,647 | ) | | | (163,419,797 | ) |
From merger | | | 16,941,795 | | | | — | | | | — | | | | — | |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | (110,430,660 | ) | | | 55,389,664 | | | | (50,085,457 | ) | | | (62,928,024 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | (44,457,003 | ) | | | (119,815,061 | ) | | | (32,212,480 | ) | | | (102,614,408 | ) |
| | | | |
| | | | |
NET ASSETS | | | | | | | | | | | | | | | | |
Beginning of Period | | $ | 1,522,729,819 | | | $ | 1,642,544,880 | | | $ | 345,443,578 | | | $ | 448,057,986 | |
| | | | |
End of Period | | $ | 1,478,272,816 | | | $ | 1,522,729,819 | | | $ | 313,231,098 | | | $ | 345,443,578 | |
| | | | |
| | | | |
SHARE TRANSACTIONS | | | | | | | | | | | | | | | | |
Beginning of period | | | 29,125,001 | | | | 28,150,001 | | | | 6,825,001 | | | | 8,000,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 8,675,000 | | | | 9,150,000 | | | | 1,075,000 | | | | 1,850,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (10,925,060 | ) | | | (8,175,000 | ) | | | (2,025,000 | ) | | | (3,025,000 | ) |
From Merger (Note12) | | | 292,980 | | | | — | | | | — | | | | — | |
| | | | |
Shares Outstanding, End of Period | | | 27,167,921 | | | | 29,125,001 | | | | 5,875,001 | | | | 6,825,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 89 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Index Fund | | | FlexShares® International Quality Dividend Defensive Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 27,194,270 | | | $ | 28,081,621 | | | $ | 1,520,040 | | | $ | 2,830,675 | |
Net realized gain (loss) | | | (10,397,660 | ) | | | (35,389,643 | ) | | | 19,327 | | | | (4,890,674 | ) |
Net change in unrealized appreciation (depreciation) | | | 58,209,253 | | | | (140,731,898 | ) | | | 3,783,570 | | | | (12,707,606 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 75,005,863 | | | | (148,039,920 | ) | | | 5,322,937 | | | | (14,767,605 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (25,465,739 | ) | | | (29,536,094 | ) | | | (1,463,869 | ) | | | (2,940,092 | ) |
| | | | |
Total distributions | | | (25,465,739 | ) | | | (29,536,094 | ) | | | (1,463,869 | ) | | | (2,940,092 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 44,718,076 | | | | 30,204,474 | | | | — | | | | — | |
Cost of shares redeemed | | | (27,479,378 | ) | | | (36,538,271 | ) | | | (17,901,037 | ) | | | (13,205,553 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 17,238,698 | | | | (6,333,797 | ) | | | (17,901,037 | ) | | | (13,205,553 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | 66,778,822 | | | | (183,909,811 | ) | | | (14,041,969 | ) | | | (30,913,250 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 432,097,092 | | | $ | 616,006,903 | | | $ | 40,545,341 | | | $ | 71,458,591 | |
| | | | |
End of Period | | $ | 498,875,914 | | | $ | 432,097,092 | | | $ | 26,503,372 | | | $ | 40,545,341 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 23,400,001 | | | | 23,900,001 | | | | 2,300,001 | | | | 3,000,001 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 2,000,000 | | | | 1,200,000 | | | | — | | | | — | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (1,300,000 | ) | | | (1,700,000 | ) | | | (900,000 | ) | | | (700,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 24,100,001 | | | | 23,400,001 | | | | 1,400,001 | | | | 2,300,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
90 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Dynamic Index Fund | | | FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 4,358,575 | | | $ | 4,143,080 | | | $ | 80,855,817 | | | $ | 129,946,912 | |
Net realized gain (loss) | | | 414,028 | | | | (6,336,149 | ) | | | (69,973,937 | ) | | | (61,202,821 | ) |
Net change in unrealized appreciation (depreciation) | | | 9,170,674 | | | | (19,667,897 | ) | | | 26,655,120 | | | | (171,934,382 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | 13,943,277 | | | | (21,860,966 | ) | | | 37,537,000 | | | | (103,190,291 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (4,043,930 | ) | | | (4,368,329 | ) | | | (70,475,144 | ) | | | (131,367,411 | ) |
Tax return of capital | | | — | | | | — | | | | — | | | | (2,470,987 | ) |
| | | | |
Total distributions | | | (4,043,930 | ) | | | (4,368,329 | ) | | | (70,475,144 | ) | | | (133,838,398 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 41,723,239 | | | | 14,075,676 | | | | 357,413,947 | | | | 1,154,710,930 | |
Cost of shares redeemed | | | (47,697,235 | ) | | | (2,032,721 | ) | | | (554,491,181 | ) | | | (197,328,045 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | (5,973,996 | ) | | | 12,042,955 | | | | (197,077,234 | ) | | | 957,382,885 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 3,925,351 | | | | (14,186,340 | ) | | | (230,015,378 | ) | | | 720,354,196 | |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 61,788,357 | | | $ | 75,974,697 | | | $ | 2,157,938,615 | | | $ | 1,437,584,419 | |
| | | | |
End of Period | | $ | 65,713,708 | | | $ | 61,788,357 | | | $ | 1,927,923,237 | | | $ | 2,157,938,615 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 2,900,001 | | | | 2,500,001 | | | | 91,504,000 | | | | 54,504,000 | |
Shares issued | | | — | | | | — | | | | — | | | | — | |
Shares issued in-kind | | | 1,600,000 | | | | 500,000 | | | | 15,150,000 | | | | 45,050,000 | |
Shares redeemed | | | — | | | | — | | | | — | | | | — | |
Shares redeemed in-kind | | | (1,800,000 | ) | | | (100,000 | ) | | | (23,450,000 | ) | | | (8,050,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 2,700,001 | | | | 2,900,001 | | | | 83,204,000 | | | | 91,504,000 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 91 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund | | | FlexShares® Disciplined Duration MBS Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 30,438,750 | | | $ | 52,412,741 | | | $ | 2,208,555 | | | $ | 1,315,458 | |
Net realized gain (loss) | | | (33,637,850 | ) | | | (23,575,612 | ) | | | (3,912,271 | ) | | | (4,182,658 | ) |
Net change in unrealized appreciation (depreciation) | | | 1,002,375 | | | | (102,258,738 | ) | | | 3,495,416 | | | | (11,405,968 | ) |
| | | | |
| | | | |
Net Increase (Decrease) in Net Assets | | | | | | | | | | | | | | | | |
Resulting from Operations | | | (2,196,725 | ) | | | (73,421,609 | ) | | | 1,791,700 | | | | (14,273,168 | ) |
| | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS | |
Distributable earnings | | | (25,865,870 | ) | | | (53,319,431 | ) | | | (2,711,658 | ) | | | (2,906,209 | ) |
Tax return of capital | | | — | | | | (769,089 | ) | | | — | | | | — | |
| | | | |
Total distributions | | | (25,865,870 | ) | | | (54,088,520 | ) | | | (2,711,658 | ) | | | (2,906,209 | ) |
| | | | |
|
CAPITAL TRANSACTIONS(1) | |
Proceeds from shares issued | | | 377,819,623 | | | | 259,127,932 | | | | 19,682,625 | | | | 24,467,825 | |
Cost of shares redeemed | | | (182,093,124 | ) | | | (202,210,614 | ) | | | (41,527,581 | ) | | | (21,342,283 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 195,726,499 | | | | 56,917,318 | | | | (21,844,956 | ) | | | 3,125,542 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 167,663,904 | | | | (70,592,811 | ) | | | (22,764,914 | ) | | | (14,053,835 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 643,886,498 | | | $ | 714,479,309 | | | $ | 97,188,953 | | | $ | 111,242,788 | |
| | | | |
End of Period | | $ | 811,550,402 | | | $ | 643,886,498 | | | $ | 74,424,039 | | | $ | 97,188,953 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 27,250,001 | | | | 25,500,001 | | | | 4,850,001 | | | | 4,750,001 | |
Shares issued | | | — | | | | — | | | | 1,000,000 | | | | 1,100,000 | |
Shares issued in-kind | | | 16,100,000 | | | | 9,600,000 | | | | — | | | | — | |
Shares redeemed | | | — | | | | — | | | | (2,050,000 | ) | | | (1,000,000 | ) |
Shares redeemed in-kind | | | (7,700,000 | ) | | | (7,850,000 | ) | | | — | | | | — | |
| | | | |
Shares Outstanding, End of Period | | | 35,650,001 | | | | 27,250,001 | | | | 3,800,001 | | | | 4,850,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
92 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Credit-Scored US Corporate Bond Index Fund | | | FlexShares® Credit-Scored US Long Corporate Bond Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 9,306,976 | | | $ | 5,647,170 | | | $ | 1,688,422 | | | $ | 1,897,648 | |
Net realized gain (loss) | | | (16,010,333 | ) | | | (11,524,528 | ) | | | (7,142,718 | ) | | | (5,104,776 | ) |
Net change in unrealized appreciation (depreciation) | | | 15,511,584 | | | | (31,515,973 | ) | | | 6,730,934 | | | | (14,928,195 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | | 8,808,227 | | | | (37,393,331 | ) | | | 1,276,638 | | | | (18,135,323 | ) |
| | | | |
| |
DISTRIBUTIONS TO SHAREHOLDERS | | | | |
Distributable earnings | | | (8,908,201 | ) | | | (8,289,209 | ) | | | (1,709,535 | ) | | | (2,837,455 | ) |
| | | | |
Total distributions | | | (8,908,201 | ) | | | (8,289,209 | ) | | | (1,709,535 | ) | | | (2,837,455 | ) |
| | | | |
| |
CAPITAL TRANSACTIONS(1) | | | | |
Proceeds from shares issued | | | 55,818,255 | | | | 54,188,645 | | | | — | | | | — | |
Cost of shares redeemed | | | (23,307,499 | ) | | | (82,107,127 | ) | | | (6,489,373 | ) | | | (4,384,065 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 32,510,756 | | | | (27,918,482 | ) | | | (6,489,373 | ) | | | (4,384,065 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | 32,410,782 | | | | (73,601,022 | ) | | | (6,922,270 | ) | | | (25,356,843 | ) |
| | | | |
|
NET ASSETS | |
Beginning of Period | | $ | 242,138,957 | | | $ | 315,739,979 | | | $ | 35,497,734 | | | $ | 60,854,577 | |
| | | | |
End of Period | | $ | 274,549,739 | | | $ | 242,138,957 | | | $ | 28,575,464 | | | $ | 35,497,734 | |
| | | | |
|
SHARE TRANSACTIONS | |
Beginning of period | | | 5,350,001 | | | | 5,900,001 | | | | 900,001 | | | | 1,000,001 | |
Shares issued | | | 1,150,000 | | | | 950,000 | | | | — | | | | — | |
Shares issued in-kind | | | 50,000 | | | | 150,000 | | | | — | | | | — | |
Shares redeemed | | | (500,000 | ) | | | (1,500,000 | ) | | | (150,000 | ) | | | (100,000 | ) |
Shares redeemed in-kind | | | — | | | | (150,000 | ) | | | — | | | | — | |
| | | | |
Shares Outstanding, End of Period | | | 6,050,001 | | | | 5,350,001 | | | | 750,001 | | | | 900,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 93 | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® High Yield Value-Scored Bond Index Fund | | | FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 96,537,666 | | | $ | 54,264,979 | | | $ | 1,330,927 | | | $ | 1,023,293 | |
Net realized gain (loss) | | | (73,703,129 | ) | | | (84,823,660 | ) | | | (2,757,523 | ) | | | (5,269,138 | ) |
Net change in unrealized appreciation (depreciation) | | | 27,158,390 | | | | (89,845,656 | ) | | | 1,697,139 | | | | (4,417,178 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | | 49,992,927 | | | | (120,404,337 | ) | | | 270,543 | | | | (8,663,023 | ) |
| | | | |
| | | | |
DISTRIBUTIONS TO SHAREHOLDERS | | | | | | | | | | | | | | | | |
Distributable earnings | | | (93,229,360 | ) | | | (56,016,563 | ) | | | (1,318,208 | ) | | | (1,093,741 | ) |
| | | | |
Total distributions | | | (93,229,360 | ) | | | (56,016,563 | ) | | | (1,318,208 | ) | | | (1,093,741 | ) |
| | | | |
| | | | |
CAPITAL TRANSACTIONS(1) | | | | | | | | | | | | | | | | |
Proceeds from shares issued | | | 811,946,065 | | | | 746,832,545 | | | | 14,243,947 | | | | 6,485,716 | |
Cost of shares redeemed | | | (434,348,479 | ) | | | (257,649,977 | ) | | | (11,679,660 | ) | | | (22,920,483 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 377,597,586 | | | | 489,182,568 | | | | 2,564,287 | | | | (16,434,767 | ) |
| | | | |
Total Increase (Decrease) in Net Assets | | | 334,361,153 | | | | 312,761,668 | | | | 1,516,622 | | | | (26,191,531 | ) |
| | | | |
| | | | |
NET ASSETS | | | | | | | | | | | | | | | | |
Beginning of Period | | $ | 887,945,368 | | | $ | 575,183,700 | | | $ | 23,155,525 | | | $ | 49,347,056 | |
| | | | |
End of Period | | $ | 1,222,306,521 | | | $ | 887,945,368 | | | $ | 24,672,147 | | | $ | 23,155,525 | |
| | | | |
| | | | |
SHARE TRANSACTIONS | | | | | | | | | | | | | | | | |
Beginning of period | | | 22,150,001 | | | | 11,600,001 | | | | 600,000 | | | | 1,000,000 | |
Shares issued | | | 20,050,000 | | | | 14,850,000 | | | | 350,000 | | | | 150,000 | |
Shares issued in-kind | | | 200,000 | | | | 1,700,000 | | | | — | | | | — | |
Shares redeemed | | | (10,850,000 | ) | | | (5,500,000 | ) | | | (300,000 | ) | | | (550,000 | ) |
Shares redeemed in-kind | | | — | | | | (500,000 | ) | | | — | | | | — | |
| | | | |
Shares Outstanding, End of Period | | | 31,550,001 | | | | 22,150,001 | | | | 650,000 | | | | 600,000 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | |
94 | | FLEXSHARES ANNUAL REPORT | | |
Statements of Changes in Net Assets (cont.)
| | | | | | | | | | | | | | | | |
| | FlexShares® Ultra-Short Income Fund | | | FlexShares® Core Select Bond Fund | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | | | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
|
OPERATIONS | |
Net investment income (loss) | | $ | 41,455,881 | | | $ | 8,594,946 | | | $ | 5,495,196 | | | $ | 3,278,852 | |
Net realized gain (loss) | | | 14,152 | | | | (815,721 | ) | | | (3,189,773 | ) | | | (14,903,388 | ) |
Net change in unrealized appreciation (depreciation) | | | 7,484,444 | | | | (11,518,881 | ) | | | (3,921,207 | ) | | | (13,967,521 | ) |
| | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | | 48,954,477 | | | | (3,739,656 | ) | | | (1,615,784 | ) | | | (25,592,057 | ) |
| | | | |
| | | | |
DISTRIBUTIONS TO SHAREHOLDERS | | | | | | | | | | | | | | | | |
Distributable earnings | | | (38,566,601 | ) | | | (7,907,561 | ) | | | (5,547,838 | ) | | | (3,352,156 | ) |
| | | | |
Total distributions | | | (38,566,601 | ) | | | (7,907,561 | ) | | | (5,547,838 | ) | | | (3,352,156 | ) |
| | | | |
| | | | |
CAPITAL TRANSACTIONS(1) | | | | | | | | | | | | | | | | |
Proceeds from shares issued | | | 250,651,014 | | | | 583,737,232 | | | | 51,364,787 | | | | 73,291,854 | |
Cost of shares redeemed | | | (41,006,742 | ) | | | (90,072,224 | ) | | | (21,132,381 | ) | | | (11,502,530 | ) |
| | | | |
Net Increase (Decrease) from Capital Transactions | | | 209,644,272 | | | | 493,665,008 | | | | 30,232,406 | | | | 61,789,324 | |
| | | | |
Total Increase (Decrease) in Net Assets | | | 220,032,148 | | | | 482,017,791 | | | | 23,068,784 | | | | 32,845,111 | |
| | | | |
| | | | |
NET ASSETS | | | | | | | | | | | | | | | | |
Beginning of Period | | $ | 856,356,930 | | | $ | 374,339,139 | | | $ | 159,362,079 | | | $ | 126,516,968 | |
| | | | |
End of Period | | $ | 1,076,389,078 | | | $ | 856,356,930 | | | $ | 182,430,863 | | | $ | 159,362,079 | |
| | | | |
| | | | |
SHARE TRANSACTIONS | | | | | | | | | | | | | | | | |
Beginning of period | | | 11,525,001 | | | | 4,925,001 | | | | 7,425,001 | | | | 4,825,001 | |
Shares issued | | | 3,355,000 | | | | 7,800,000 | | | | — | | | | — | |
Shares issued in-kind | | | — | | | | — | | | | 2,325,000 | | | | 3,075,000 | |
Shares redeemed | | | (550,000 | ) | | | (1,200,000 | ) | | | — | | | | — | |
Shares redeemed in-kind | | | — | | | | — | | | | (975,000 | ) | | | (475,000 | ) |
| | | | |
Shares Outstanding, End of Period | | | 14,330,001 | | | | 11,525,001 | | | | 8,775,001 | | | | 7,425,001 | |
| | | | |
(1) | Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 95 | |
FlexShares® Trust
Financial Highlights
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Low Volatility Index Fund | |
| | | | | | | | | | | | | | For the period 07/15/19* through 10/31/19 | |
| | | | | | | | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | |
| | | | | |
Net asset value, beginning of period | | $ | 50.02 | | | $ | 54.60 | | | $ | 40.93 | | | $ | 40.44 | | | $ | 40.00 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.88 | | | | 0.82 | | | | 0.57 | | | | 0.64 | | | | 0.17 | |
Net Realized and Unrealized Gain (Loss) | | | 1.40 | | | | (4.70 | ) | | | 13.69 | | | | 0.38 | | | | 0.35 | |
| | | | |
Total from Operations | | | 2.28 | | | | (3.88 | ) | | | 14.26 | | | | 1.02 | | | | 0.52 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.91 | ) | | | (0.70 | ) | | | (0.59 | ) | | | (0.53 | ) | | | (0.08 | ) |
| | | | |
Total from Distributions | | | (0.91 | ) | | | (0.70 | ) | | | (0.59 | ) | | | (0.53 | ) | | | (0.08 | ) |
| | | | |
Net Asset Value, end of period | | $ | 51.39 | | | $ | 50.02 | | | $ | 54.60 | | | $ | 40.93 | | | $ | 40.44 | |
| | | | |
Total Return(b) | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 4.56 | % | | | (7.12 | )% | | | 35.05 | % | | | 2.63 | % | | | 1.30 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets(c) | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % |
Expenses net of reimbursements | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % |
Net Investment Income Before Reimbursements | | | 1.70 | % | | | 1.58 | % | | | 1.17 | % | | | 1.55 | % | | | 1.45 | % |
Net Investment Income Net of Reimbursements | | | 1.70 | % | | | 1.58 | % | | | 1.17 | % | | | 1.56 | % | | | 1.45 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 51 | % | | | 48 | % | | | 43 | % | | | 47 | % | | | 9 | % |
Net assets, end of period (thousands) | | $ | 185,005 | | | $ | 162,569 | | | $ | 161,074 | | | $ | 110,524 | | | $ | 6,067 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | |
96 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | |
| | | | | | | | | | | | | | For the period 07/15/19* through 10/31/19 | |
| | | | | | | | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | |
| | | | | |
Net asset value, beginning of period | | $ | 22.09 | | | $ | 27.92 | | | $ | 23.48 | | | $ | 25.60 | | | $ | 25.00 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.73 | | | | 0.66 | | | | 0.73 | | | | 0.64 | | | | 0.16 | |
Net Realized and Unrealized Gain (Loss) | | | 1.55 | | | | (5.71 | ) | | | 4.43 | | | | (2.22 | ) | | | 0.53 | |
| | | | |
Total from Operations | | | 2.28 | | | | (5.05 | ) | | | 5.16 | | | | (1.58 | ) | | | 0.69 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.70 | ) | | | (0.78 | ) | | | (0.72 | ) | | | (0.54 | ) | | | (0.09 | ) |
| | | | |
Total from Distributions | | | (0.70 | ) | | | (0.78 | ) | | | (0.72 | ) | | | (0.54 | ) | | | (0.09 | ) |
| | | | |
Net Asset Value, end of period | | $ | 23.67 | | | $ | 22.09 | | | $ | 27.92 | | | $ | 23.48 | | | $ | 25.60 | |
| | | | |
Total Return(b) | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 10.16 | % | | | (18.36 | )% | | | 22.05 | % | | | (6.24 | )% | | | 2.76 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets(c) | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % | | | 0.32 | % |
Expenses net of reimbursements | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % |
Net Investment Income Before Reimbursements | | | 2.94 | % | | | 2.60 | % | | | 2.68 | % | | | 2.63 | % | | | 2.21 | % |
Net Investment Income Net of Reimbursements | | | 2.94 | % | | | 2.60 | % | | | 2.68 | % | | | 2.64 | % | | | 2.21 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 52 | % | | | 56 | % | | | 56 | % | | | 62 | % | | | 14 | % |
Net assets, end of period (thousands) | | $ | 66,263 | | | $ | 61,852 | | | $ | 75,371 | | | $ | 65,747 | | | $ | 5,120 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 97 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Emerging Markets Quality Low Volatility Index Fund | |
| | | | | | | | | | | | | | For the period 07/15/19* through 10/31/19 | |
| | | | | | | | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | |
| | | | | |
Net asset value, beginning of period | | $ | 20.53 | | | $ | 26.41 | | | $ | 23.95 | | | $ | 24.94 | | | $ | 25.00 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.76 | | | | 0.67 | | | | 0.69 | | | | 0.56 | | | | 0.23 | |
Net Realized and Unrealized Gain (Loss) | | | 1.02 | | | | (5.82 | ) | | | 2.22 | | | | (0.91 | ) | | | (0.18 | ) |
| | | | |
Total from Operations | | | 1.78 | | | | (5.15 | ) | | | 2.91 | | | | (0.35 | ) | | | 0.05 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.68 | ) | | | (0.69 | ) | | | (0.45 | ) | | | (0.64 | ) | | | (0.11 | ) |
Tax Return of Capital | | | — | | | | (0.04 | ) | | | — | | | | — | | | | — | |
| | | | |
Total from Distributions | | | (0.68 | ) | | | (0.73 | ) | | | (0.45 | ) | | | (0.64 | ) | | | (0.11 | ) |
| | | | |
Net Asset Value, end of period | | $ | 21.63 | | | $ | 20.53 | | | $ | 26.41 | | | $ | 23.95 | | | $ | 24.94 | |
| | | | |
Total Return(b) | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 8.52 | % | | | (19.77 | )% | | | 12.09 | % | | | (1.41 | )% | | | 0.19 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets(c) | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.41 | % | | | 0.41 | % | | | 0.41 | % | | | 0.41 | % | | | 0.40 | % |
Expenses net of reimbursements | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % |
Net Investment Income Before Reimbursements | | | 3.35 | % | | | 2.75 | % | | | 2.57 | % | | | 2.38 | % | | | 3.18 | % |
Net Investment Income Net of Reimbursements | | | 3.35 | % | | | 2.75 | % | | | 2.58 | % | | | 2.39 | % | | | 3.18 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 75 | % | | | 53 | % | | | 54 | % | | | 81 | % | | | 12 | % |
Net assets, end of period (thousands) | | $ | 12,980 | | | $ | 8,214 | | | $ | 15,844 | | | $ | 9,578 | | | $ | 4,989 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | |
98 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar US Market Factor Tilt Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 151.07 | | | $ | 178.97 | | | $ | 121.11 | | | $ | 119.52 | | | $ | 110.13 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 2.53 | | | | 2.39 | | | | 2.08 | | | | 2.10 | | | | 1.95 | |
Net Realized and Unrealized Gain (Loss) | | | 6.03 | | | | (27.93 | ) | | | 57.80 | | | | 1.60 | | | | 9.33 | |
| | | | |
Total from Operations | | | 8.56 | | | | (25.54 | ) | | | 59.88 | | | | 3.70 | | | | 11.28 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (2.45 | ) | | | (2.36 | ) | | | (2.02 | ) | | | (2.11 | ) | | | (1.89 | ) |
| | | | |
Total from Distributions | | | (2.45 | ) | | | (2.36 | ) | | | (2.02 | ) | | | (2.11 | ) | | | (1.89 | ) |
| | | | |
Net Asset Value, end of period | | $ | 157.18 | | | $ | 151.07 | | | $ | 178.97 | | | $ | 121.11 | | | $ | 119.52 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 5.67 | % | | | (14.33 | )% | | | 49.68 | % | | | 3.28 | % | | | 10.41 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % |
Expenses net of reimbursements | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % |
Net Investment Income Before Reimbursements | | | 1.58 | % | | | 1.47 | % | | | 1.28 | % | | | 1.78 | % | | | 1.72 | % |
Net Investment Income Net of Reimbursements | | | 1.58 | % | | | 1.47 | % | | | 1.29 | % | | | 1.79 | % | | | 1.72 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 15 | % | | | 14 | % | | | 24 | % | | | 26 | % | | | 28 | % |
Net assets, end of period (thousands) | | $ | 1,336,011 | | | $ | 1,397,408 | | | $ | 1,727,019 | | | $ | 1,174,786 | | | $ | 1,446,137 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 99 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 54.48 | | | $ | 73.71 | | | $ | 54.24 | | | $ | 62.67 | | | $ | 59.76 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.93 | | | | 1.94 | | | | 1.71 | | | | 1.31 | | | | 1.85 | |
Net Realized and Unrealized Gain (Loss) | | | 5.37 | | | | (18.44 | ) | | | 19.27 | | | | (7.88 | ) | | | 2.89 | |
| | | | |
Total from Operations | | | 7.30 | | | | (16.50 | ) | | | 20.98 | | | | (6.57 | ) | | | 4.74 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.62 | ) | | | (2.61 | ) | | | (1.51 | ) | | | (1.86 | ) | | | (1.83 | ) |
Tax Return of Capital | | | — | | | | (0.12 | ) | | | — | | | | — | | | | — | |
| | | | |
Total from Distributions | | | (1.62 | ) | | | (2.73 | ) | | | (1.51 | ) | | | (1.86 | ) | | | (1.83 | ) |
| | | | |
Net Asset Value, end of period | | $ | 60.16 | | | $ | 54.48 | | | $ | 73.71 | | | $ | 54.24 | | | $ | 62.67 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 13.21 | % | | | (22.83 | )% | | | 38.79 | % | | | (10.57 | )% | | | 8.13 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % | | | 0.40 | % |
Expenses net of reimbursements | | | 0.39 | % | | | 0.39 | % | | | 0.39 | % | | | 0.39 | % | | | 0.39 | % |
Net Investment Income Before Reimbursements | | | 3.04 | % | | | 3.02 | % | | | 2.42 | % | | | 2.28 | % | | | 3.09 | % |
Net Investment Income Net of Reimbursements | | | 3.04 | % | | | 3.02 | % | | | 2.42 | % | | | 2.28 | % | | | 3.09 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 22 | % | | | 27 | % | | | 29 | % | | | 21 | % | | | 25 | % |
Net assets, end of period (thousands) | | $ | 469,239 | | | $ | 446,754 | | | $ | 648,638 | | | $ | 499,016 | | | $ | 965,142 | |
See Accompanying Notes to the Financial Statements.
| | | | |
100 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 42.22 | | | $ | 60.79 | | | $ | 48.05 | | | $ | 50.42 | | | $ | 47.92 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.45 | | | | 1.86 | | | | 1.51 | | | | 1.02 | | | | 1.49 | |
Net Realized and Unrealized Gain (Loss) | | | 4.36 | | | | (18.06 | ) | | | 12.40 | | | | (1.97 | ) | | | 2.46 | |
| | | | |
Total from Operations | | | 5.81 | | | | (16.20 | ) | | | 13.91 | | | | (0.95 | ) | | | 3.95 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.49 | ) | | | (2.37 | ) | | | (1.17 | ) | | | (1.42 | ) | | | (1.45 | ) |
| | | | |
Total from Distributions | | | (1.49 | ) | | | (2.37 | ) | | | (1.17 | ) | | | (1.42 | ) | | | (1.45 | ) |
| | | | |
Net Asset Value, end of period | | $ | 46.54 | | | $ | 42.22 | | | $ | 60.79 | | | $ | 48.05 | | | $ | 50.42 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 13.63 | %(f) | | | (27.32 | )% | | | 28.95 | % | | | (1.86 | )% | | | 8.29 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.61 | % | | | 0.60 | % | | | 0.60 | % | | | 0.60 | % | | | 0.60 | % |
Expenses net of reimbursements | | | 0.59 | % | | | 0.59 | % | | | 0.59 | % | | | 0.59 | % | | | 0.59 | % |
Net Investment Income Before Reimbursements | | | 2.95 | % | | | 3.49 | % | | | 2.46 | % | | | 2.13 | % | | | 2.92 | % |
Net Investment Income Net of Reimbursements | | | 2.97 | % | | | 3.49 | % | | | 2.47 | % | | | 2.14 | % | | | 2.93 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 39 | % | | | 34 | % | | | 40 | % | | | 41 | % | | | 45 | % |
Net assets, end of period (thousands) | | $ | 218,724 | | | $ | 206,889 | | | $ | 334,372 | | | $ | 225,847 | | | $ | 413,414 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 101 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® US Quality Large Cap Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 43.17 | | | $ | 50.25 | | | $ | 35.48 | | | $ | 34.69 | | | $ | 33.44 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.67 | | | | 0.61 | | | | 0.50 | | | | 0.62 | | | | 0.68 | |
Net Realized and Unrealized Gain (Loss) | | | 3.43 | | | | (7.11 | ) | | | 14.76 | | | | 0.76 | | | | 1.29 | |
| | | | |
Total from Operations | | | 4.10 | | | | (6.50 | ) | | | 15.26 | | | | 1.38 | | | | 1.97 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.66 | ) | | | (0.58 | ) | | | (0.49 | ) | | | (0.59 | ) | | | (0.72 | ) |
| | | | |
Total from Distributions | | | (0.66 | ) | | | (0.58 | ) | | | (0.49 | ) | | | (0.59 | ) | | | (0.72 | ) |
| | | | |
Net Asset Value, end of period | | $ | 46.61 | | | $ | 43.17 | | | $ | 50.25 | | | $ | 35.48 | | | $ | 34.69 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 9.54 | % | | | (12.98 | )% | | | 43.21 | % | | | 4.13 | % | | | 6.04 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.26 | % | | | 0.30 | % | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % |
Expenses net of reimbursements | | | 0.25 | % | | | 0.30 | % | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % |
Net Investment Income Before Reimbursements | | | 1.44 | % | | | 1.31 | % | | | 1.11 | % | | | 1.77 | % | | | 2.04 | % |
Net Investment Income Net of Reimbursements | | | 1.44 | % | | | 1.31 | % | | | 1.11 | % | | | 1.77 | % | | | 2.05 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 20 | % | | | 22 | % | | | 30 | % | | | 48 | % | | | 69 | % |
Net assets, end of period (thousands) | | $ | 146,806 | | | $ | 127,350 | | | $ | 144,475 | | | $ | 71,842 | | | $ | 51,171 | |
See Accompanying Notes to the Financial Statements.
| | | | |
102 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® US ESG Select Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 92.96 | | | $ | 112.73 | | | $ | 79.16 | | | $ | 72.29 | | | $ | 64.33 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.32 | | | | 1.22 | | | | 1.26 | | | | 1.27 | | | | 1.21 | |
Net Realized and Unrealized Gain (Loss) | | | 9.71 | | | | (19.75 | ) | | | 33.50 | | | | 6.81 | | | | 7.83 | |
| | | | |
Total from Operations | | | 11.03 | | | | (18.53 | ) | | | 34.76 | | | | 8.08 | | | | 9.04 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.27 | ) | | | (1.24 | ) | | | (1.19 | ) | | | (1.21 | ) | | | (1.08 | ) |
| | | | |
Total from Distributions | | | (1.27 | ) | | | (1.24 | ) | | | (1.19 | ) | | | (1.21 | ) | | | (1.08 | ) |
| | | | |
Net Asset Value, end of period | | $ | 102.72 | | | $ | 92.96 | | | $ | 112.73 | | | $ | 79.16 | | | $ | 72.29 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 11.91 | % | | | (16.51 | )% | | | 44.15 | % | | | 11.40 | % | | | 14.21 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % | | | 0.33 | % |
Expenses net of reimbursements | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % | | | 0.32 | % |
Net Investment Income Before Reimbursements | | | 1.30 | % | | | 1.20 | % | | | 1.25 | % | | | 1.67 | % | | | 1.78 | % |
Net Investment Income Net of Reimbursements | | | 1.30 | % | | | 1.20 | % | | | 1.26 | % | | | 1.68 | % | | | 1.79 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 28 | % | | | 46 | % | | | 40 | % | | | 66 | % | | | 75 | % |
Net assets, end of period (thousands) | | $ | 166,925 | | | $ | 171,980 | | | $ | 191,643 | | | $ | 89,052 | | | $ | 56,024 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 103 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® Global ESG Select Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 117.54 | | | $ | 148.57 | | | $ | 106.02 | | | $ | 101.77 | | | $ | 91.61 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 2.42 | | | | 2.24 | | | | 2.03 | | | | 1.72 | | | | 2.05 | |
Net Realized and Unrealized Gain (Loss) | | | 14.27 | | | | (30.82 | ) | | | 42.38 | | | | 4.26 | | | | 10.12 | |
| | | | |
Total from Operations | | | 16.69 | | | | (28.58 | ) | | | 44.41 | | | | 5.98 | | | | 12.17 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (2.22 | ) | | | (2.45 | ) | | | (1.86 | ) | | | (1.73 | ) | | | (2.01 | ) |
| | | | |
Total from Distributions | | | (2.22 | ) | | | (2.45 | ) | | | (1.86 | ) | | | (1.73 | ) | | | (2.01 | ) |
| | | | |
Net Asset Value, end of period | | $ | 132.01 | | | $ | 117.54 | | | $ | 148.57 | | | $ | 106.02 | | | $ | 101.77 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 14.17 | % | | | (19.35 | )% | | | 42.10 | % | | | 6.03 | % | | | 13.49 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | |
Expenses | | | 0.43 | % | | | 0.43 | % | | | 0.43 | % | | | 0.43 | % | | | 0.43 | % |
Expenses net of reimbursements | | | 0.42 | % | | | 0.42 | % | | | 0.42 | % | | | 0.42 | % | | | 0.42 | % |
Net Investment Income Before Reimbursements | | | 1.82 | % | | | 1.69 | % | | | 1.50 | % | | | 1.66 | % | | | 2.15 | % |
Net Investment Income Net of Reimbursements | | | 1.83 | % | | | 1.69 | % | | | 1.51 | % | | | 1.66 | % | | | 2.16 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 35 | % | | | 54 | % | | | 48 | % | | | 58 | % | | | 66 | % |
Net assets, end of period (thousands) | | $ | 151,816 | | | $ | 146,925 | | | $ | 185,717 | | | $ | 111,323 | | | $ | 91,590 | |
See Accompanying Notes to the Financial Statements.
| | | | |
104 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | |
| | FlexShares® ESG & Climate US Large Cap Core Index Fund | |
| | | | | For the period 09/20/21* through 10/31/21 | |
| | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | |
| | | |
Net asset value, beginning of period | | $ | 44.21 | | | $ | 53.39 | | | $ | 50.00 | |
| | | | |
| | | |
PER SHARE | | | | | | | | | | | | |
| | | |
Investment Operations | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.77 | | | | 0.70 | | | | 0.06 | |
Net Realized and Unrealized Gain (Loss) | | | 3.35 | | | | (9.25 | ) | | | 3.33 | |
| | | | |
Total from Operations | | | 4.12 | | | | (8.55 | ) | | | 3.39 | |
| | | | |
Distributions | | | | | | | | | | | | |
Net Investment Income | | | (0.72 | ) | | | (0.62 | ) | | | — | |
From Net Realized Gains | | | — | | | | (0.01 | ) | | | — | |
| | | | |
Total from Distributions | | | (0.72 | ) | | | (0.63 | ) | | | — | |
| | | | |
Net Asset Value, end of period | | $ | 47.61 | | | $ | 44.21 | | | $ | 53.39 | |
| | | | |
Total Return(b) | | | | | | | | | | | | |
Net Asset Value(d) | | | 9.33 | % | | | (16.09 | )% | | | 6.78 | % |
| | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | |
|
Ratios to Average Net Assets(c) | |
Expenses | | | 0.10 | % | | | 0.10 | % | | | 0.09 | % |
Expenses net of reimbursements | | | 0.09 | % | | | 0.09 | % | | | 0.09 | % |
Net Investment Income Before Reimbursements | | | 1.61 | % | | | 1.53 | % | | | 0.96 | % |
Net Investment Income Net of Reimbursements | | | 1.61 | % | | | 1.53 | % | | | 0.96 | % |
| | | |
Supplemental Data | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 16 | % | | | 18 | % | | | — | %(g) |
Net assets, end of period (thousands) | | $ | 36,896 | | | $ | 22,103 | | | $ | 2,669 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 105 | |
Financial Highlights (cont.)
| | | | | | | | | | | | |
| | FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | |
| | | | | | | | For the period 09/20/21* through 10/31/21 | |
| | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | |
| | | |
Net asset value, beginning of period | | $ | 38.15 | | | $ | 51.19 | | | $ | 50.00 | |
| | | | |
| | | |
PER SHARE | | | | | | | | | | | | |
| | | |
Investment Operations | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.38 | | | | 1.44 | | | | 0.16 | |
Net Realized and Unrealized Gain (Loss) | | | 3.31 | | | | (13.28 | ) | | | 1.03 | |
| | | | |
Total from Operations | | | 4.69 | | | | (11.84 | ) | | | 1.19 | |
| | | | |
Distributions | | | | | | | | | | | | |
Net Investment Income | | | (1.19 | ) | | | (1.20 | ) | | | — | |
| | | | |
Total from Distributions | | | (1.19 | ) | | | (1.20 | ) | | | — | |
| | | | |
Net Asset Value, end of period | | $ | 41.65 | | | $ | 38.15 | | | $ | 51.19 | |
| | | | |
Total Return(b) | | | | | | | | | | | | |
Net Asset Value(d) | | | 12.08 | % | | | (23.36 | )% | | | 2.38 | % |
| | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | |
|
Ratios to Average Net Assets(c) | |
Expenses | | | 0.13 | % | | | 0.13 | % | | | 0.12 | % |
Expenses net of reimbursements | | | 0.12 | % | | | 0.12 | % | | | 0.12 | % |
Net Investment Income Before Reimbursements | | | 3.09 | % | | | 3.35 | % | | | 2.72 | % |
Net Investment Income Net of Reimbursements | | | 3.09 | % | | | 3.35 | % | | | 2.72 | % |
| | | |
Supplemental Data | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 32 | % | | | 33 | % | | | — | %(g) |
Net assets, end of period (thousands) | | $ | 37,484 | | | $ | 17,169 | | | $ | 5,119 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | |
106 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | |
| | FlexShares® ESG & Climate Emerging Markets Core Index Fund | |
| | Year ended October 31, 2023 | | | For the period 04/20/22* through 10/31/22 | |
| | |
Net asset value, beginning of period | | $ | 38.68 | | | $ | 50.00 | |
| | | | |
| | |
PER SHARE | | | | | | | | |
| | |
Investment Operations | | | | | | | | |
Net Investment Income(a) | | | 1.02 | | | | 0.76 | |
Net Realized and Unrealized Gain (Loss) | | | 3.35 | | | | (11.42 | ) |
| | | | |
Total from Operations | | | 4.37 | | | | (10.66 | ) |
| | | | |
Distributions | | | | | | | | |
Net Investment Income | | | (1.05 | ) | | | (0.66 | ) |
| | | | |
Total from Distributions | | | (1.05 | ) | | | (0.66 | ) |
| | | | |
Net Asset Value, end of period | | $ | 42.00 | | | $ | 38.68 | |
| | | | |
Total Return(b) | | | | | | | | |
Net Asset Value(d) | | | 11.14 | % | | | (21.47 | )% |
| | |
RATIOS/SUPPLEMENT DATA | | | | | | | | |
|
Ratios to Average Net Assets(c) | |
Expenses | | | 0.19 | % | | | 0.19 | % |
Expenses net of reimbursements | | | 0.18 | % | | | 0.18 | % |
Net Investment Income Before Reimbursements | | | 2.27 | % | | | 3.15 | % |
Net Investment Income Net of Reimbursements | | | 2.27 | % | | | 3.15 | % |
| | |
Supplemental Data | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 36 | % | | | 18 | % |
Net assets, end of period (thousands) | | $ | 4,200 | | | $ | 3,868 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 107 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Morningstar Global Upstream Natural Resources Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 41.35 | | | $ | 38.66 | | | $ | 26.71 | | | $ | 31.40 | | | $ | 31.51 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.46 | | | | 1.88 | | | | 1.44 | | | | 0.89 | | | | 1.08 | |
Net Realized and Unrealized Gain (Loss) | | | (3.01 | ) | | | 2.76 | | | | 11.72 | | | | (4.65 | ) | | | (0.09 | ) |
| | | | |
Total from Operations | | | (1.55 | ) | | | 4.64 | | | | 13.16 | | | | (3.76 | ) | | | 0.99 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.24 | ) | | | (1.95 | ) | | | (1.21 | ) | | | (0.93 | ) | | | (1.10 | ) |
| | | | |
Total from Distributions | | | (1.24 | ) | | | (1.95 | ) | | | (1.21 | ) | | | (0.93 | ) | | | (1.10 | ) |
| | | | |
Net Asset Value, end of period | | $ | 38.56 | | | $ | 41.35 | | | $ | 38.66 | | | $ | 26.71 | | | $ | 31.40 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | (3.92 | )% | | | 12.20 | % | | | 49.70 | % | | | (11.87 | )% | | | 3.16 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % |
Expenses net of reimbursements | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % |
Net Investment Income Before Reimbursements | | | 3.48 | % | | | 4.48 | % | | | 3.95 | % | | | 3.03 | % | | | 3.40 | % |
Net Investment Income Net of Reimbursements | | | 3.48 | % | | | 4.48 | % | | | 3.95 | % | | | 3.04 | % | | | 3.41 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 27 | % | | | 32 | % | | | 28 | % | | | 29 | % | | | 24 | % |
Net assets, end of period (thousands) | | $ | 6,925,286 | | | $ | 6,834,852 | | | $ | 6,052,710 | | | $ | 2,924,726 | | | $ | 5,510,201 | |
See Accompanying Notes to the Financial Statements.
| | | | |
108 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® STOXX® Global Broad Infrastructure Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 48.32 | | | $ | 57.73 | | | $ | 48.10 | | | $ | 52.56 | | | $ | 45.09 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.40 | | | | 1.35 | | | | 1.38 | | | | 1.25 | | | | 1.35 | |
Net Realized and Unrealized Gain (Loss) | | | (0.73 | ) | | | (9.27 | ) | | | 9.57 | | | | (4.53 | ) | | | 7.34 | |
| | | | |
Total from Operations | | | 0.67 | | | | (7.92 | ) | | | 10.95 | | | | (3.28 | ) | | | 8.69 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.23 | ) | | | (1.49 | ) | | | (1.32 | ) | | | (1.18 | ) | | | (1.22 | ) |
| | | | |
Total from Distributions | | | (1.23 | ) | | | (1.49 | ) | | | (1.32 | ) | | | (1.18 | ) | | | (1.22 | ) |
| | | | |
Net Asset Value, end of period | | $ | 47.76 | | | $ | 48.32 | | | $ | 57.73 | | | $ | 48.10 | | | $ | 52.56 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 1.24 | % | | | (13.92 | )% | | | 22.85 | % | | | (6.23 | )% | | | 19.52 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % |
Expenses net of reimbursements | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % |
Net Investment Income Before Reimbursements | | | 2.74 | % | | | 2.51 | % | | | 2.45 | % | | | 2.51 | % | | | 2.73 | % |
Net Investment Income Net of Reimbursements | | | 2.74 | % | | | 2.51 | % | | | 2.45 | % | | | 2.52 | % | | | 2.74 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 12 | % | | | 16 | % | | | 13 | % | | | 13 | % | | | 12 | % |
Net assets, end of period (thousands) | | $ | 2,025,181 | | | $ | 2,500,518 | | | $ | 2,643,906 | | | $ | 1,856,596 | | | $ | 1,477,030 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 109 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Global Quality Real Estate Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 52.12 | | | $ | 70.35 | | | $ | 50.88 | | | $ | 66.60 | | | $ | 57.96 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.50 | | | | 1.67 | | | | 1.38 | | | | 1.43 | | | | 1.76 | |
Net Realized and Unrealized Gain(Loss) | | | (5.09 | ) | | | (17.88 | ) | | | 19.13 | | | | (14.62 | ) | | | 8.68 | |
| | | | |
Total from Operations | | | (3.59 | ) | | | (16.21 | ) | | | 20.51 | | | | (13.19 | ) | | | 10.44 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.48 | ) | | | (1.99 | ) | | | (1.04 | ) | | | (2.50 | ) | | | (1.80 | ) |
Tax Return of Capital | | | — | | | | (0.03 | ) | | | — | | | | (0.03 | ) | | | — | |
| | | | |
Total from Distributions | | | (1.48 | ) | | | (2.02 | ) | | | (1.04 | ) | | | (2.53 | ) | | | (1.80 | ) |
| | | | |
Net Asset Value, end of period | | $ | 47.05 | | | $ | 52.12 | | | $ | 70.35 | | | $ | 50.88 | | | $ | 66.60 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | (7.16 | )% | | | (23.51 | )% | | | 40.58 | % | | | (20.29 | )% | | | 18.37 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % | | | 0.46 | % |
Expenses net of reimbursements | | | 0.45 | % | | | 0.45 | % | | | 0.45 | % | | | 0.45 | % | | | 0.45 | % |
Net Investment Income Before Reimbursements | | | 2.83 | % | | | 2.63 | % | | | 2.16 | % | | | 2.53 | % | | | 2.80 | % |
Net Investment Income Net of Reimbursements | | | 2.83 | % | | | 2.63 | % | | | 2.17 | % | | | 2.54 | % | | | 2.81 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 49 | % | | | 54 | % | | | 52 | % | | | 56 | % | | | 53 | % |
Net assets, end of period (thousands) | | $ | 244,673 | | | $ | 328,381 | | | $ | 418,597 | | | $ | 264,574 | | | $ | 376,264 | |
See Accompanying Notes to the Financial Statements.
| | | | |
110 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Real Assets Allocation Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 28.86 | | | $ | 33.67 | | | $ | 25.72 | | | $ | 30.30 | | | $ | 26.45 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.73 | | | | 0.93 | | | | 0.83 | | | | 0.86 | | | | 0.76 | |
Net Realized and Unrealized Gain(Loss) | | | (1.21 | ) | | | (4.72 | ) | | | 7.78 | | | | (4.58 | ) | | | 3.85 | |
| | | | |
Total from Operations | | | (0.48 | ) | | | (3.79 | ) | | | 8.61 | | | | (3.72 | ) | | | 4.61 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.76 | ) | | | (1.02 | ) | | | (0.66 | ) | | | (0.86 | ) | | | (0.76 | ) |
| | | | |
Total from Distributions | | | (0.76 | ) | | | (1.02 | ) | | | (0.66 | ) | | | (0.86 | ) | | | (0.76 | ) |
| | | | |
Net Asset Value, end of period | | $ | 27.62 | | | $ | 28.86 | | | $ | 33.67 | | | $ | 25.72 | | | $ | 30.30 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | (1.78 | )% | | | (11.49 | )% | | | 33.66 | % | | | (12.45 | )% | | | 17.69 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.57 | %(h) | | | 0.58 | %(h) | | | 0.58 | %(h) | | | 0.58 | %(h) | | | 0.58 | %(h) |
Expenses net of reimbursements | | | 0.10 | %(h) | | | 0.11 | %(h) | | | 0.12 | %(h) | | | 0.11 | %(h) | | | 0.11 | %(h) |
Net Investment Income Before Reimbursements | | | 1.96 | % | | | 2.40 | % | | | 2.07 | % | | | 2.65 | % | | | 2.22 | % |
Net Investment Income Net of Reimbursements | | | 2.42 | % | | | 2.86 | % | | | 2.53 | % | | | 3.11 | % | | | 2.69 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 11 | % | | | 7 | % | | | 40 | % | | | 14 | % | | | 4 | % |
Net assets, end of period(thousands) | | $ | 16,573 | | | $ | 28,865 | | | $ | 30,300 | | | $ | 4,502 | | | $ | 11,361 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 111 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Quality Dividend Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 52.28 | | | $ | 58.35 | | | $ | 43.40 | | | $ | 46.33 | | | $ | 44.53 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.36 | | | | 1.25 | | | | 1.16 | | | | 1.24 | | | | 1.24 | |
Net Realized and Unrealized Gain(Loss) | | | 2.05 | | | | (6.05 | ) | | | 14.89 | | | | (2.67 | ) | | | 2.29 | |
| | | | |
Total from Operations | | | 3.41 | | | | (4.80 | ) | | | 16.05 | | | | (1.43 | ) | | | 3.53 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.28 | ) | | | (1.27 | ) | | | (1.10 | ) | | | (1.25 | ) | | | (1.19 | ) |
From Net Realized Gains | | | — | | | | — | | | | — | | | | (0.25 | ) | | | (0.54 | ) |
| | | | |
Total from Distributions | | | (1.28 | ) | | | (1.27 | ) | | | (1.10 | ) | | | (1.50 | ) | | | (1.73 | ) |
| | | | |
Net Asset Value, end of period | | $ | 54.41 | | | $ | 52.28 | | | $ | 58.35 | | | $ | 43.40 | | | $ | 46.33 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 6.52 | % | | | (8.29 | )% | | | 37.27 | % | | | (2.98 | )% | | | 8.45 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % |
Expenses net of reimbursements | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % |
Net Investment Income Before Reimbursements | | | 2.45 | % | | | 2.24 | % | | | 2.16 | % | | | 2.79 | % | | | 2.80 | % |
Net Investment Income Net of Reimbursements | | | 2.45 | % | | | 2.24 | % | | | 2.16 | % | | | 2.79 | % | | | 2.81 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 51 | % | | | 40 | % | | | 51 | % | | | 75 | % | | | 95 | % |
Net assets, end of period (thousands) | | $ | 1,478,273 | | | $ | 1,522,730 | | | $ | 1,642,545 | | | $ | 1,265,177 | | | $ | 1,707,344 | |
See Accompanying Notes to the Financial Statements.
| | | | |
112 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Quality Dividend Defensive Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 50.61 | | | $ | 56.01 | | | $ | 42.61 | | | $ | 46.25 | | | $ | 44.46 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.29 | | | | 1.16 | | | | 1.09 | | | | 1.21 | | | | 1.22 | |
Net Realized and Unrealized Gain(Loss) | | | 2.66 | | | | (5.35 | ) | | | 13.39 | | | | (3.28 | ) | | | 3.35 | |
| | | | |
Total from Operations | | | 3.95 | | | | (4.19 | ) | | | 14.48 | | | | (2.07 | ) | | | 4.57 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.24 | ) | | | (1.21 | ) | | | (1.08 | ) | | | (1.21 | ) | | | (1.14 | ) |
From Net Realized Gains | | | — | | | | — | | | | — | | | | (0.36 | ) | | | (1.64 | ) |
| | | | |
Total from Distributions | | | (1.24 | ) | | | (1.21 | ) | | | (1.08 | ) | | | (1.57 | ) | | | (2.78 | ) |
| | | | |
Net Asset Value, end of period | | $ | 53.32 | | | $ | 50.61 | | | $ | 56.01 | | | $ | 42.61 | | | $ | 46.25 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 7.82 | % | | | (7.53 | )% | | | 34.28 | % | | | (4.45 | )% | | | 11.40 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % |
Expenses net of reimbursements | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % |
Net Investment Income Before Reimbursements | | | 2.39 | % | | | 2.16 | % | | | 2.10 | % | | | 2.77 | % | | | 2.76 | % |
Net Investment Income Net of Reimbursements | | | 2.40 | % | | | 2.16 | % | | | 2.11 | % | | | 2.77 | % | | | 2.76 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 51 | % | | | 47 | % | | | 57 | % | | | 76 | % | | | 91 | % |
Net assets, end of period(thousands) | | $ | 313,231 | | | $ | 345,444 | | | $ | 448,058 | | | $ | 411,173 | | | $ | 450,963 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 113 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 18.47 | | | $ | 25.77 | | | $ | 20.15 | | | $ | 23.06 | | | $ | 22.37 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.12 | | | | 1.15 | | | | 0.97 | | | | 0.79 | | | | 1.13 | |
Net Realized and Unrealized Gain(Loss) | | | 2.14 | | | | (7.23 | ) | | | 5.55 | | | | (2.86 | ) | | | 0.70 | |
| | | | |
Total from Operations | | | 3.26 | | | | (6.08 | ) | | | 6.52 | | | | (2.07 | ) | | | 1.83 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.03 | ) | | | (1.22 | ) | | | (0.90 | ) | | | (0.84 | ) | | | (1.14 | ) |
| | | | |
Total from Distributions | | | (1.03 | ) | | | (1.22 | ) | | | (0.90 | ) | | | (0.84 | ) | | | (1.14 | ) |
| | | | |
Net Asset Value, end of period | | $ | 20.70 | | | $ | 18.47 | | | $ | 25.77 | | | $ | 20.15 | | | $ | 23.06 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 17.45 | % | | | (24.11 | )% | | | 32.42 | % | | | (8.94 | )% | | | 8.41 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.49 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % |
Expenses net of reimbursements | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % |
Net Investment Income Before Reimbursements | | | 5.13 | % | | | 5.11 | % | | | 3.80 | % | | | 3.68 | % | | | 4.98 | % |
Net Investment Income Net of Reimbursements | | | 5.14 | % | | | 5.11 | % | | | 3.81 | % | | | 3.68 | % | | | 4.98 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 49 | % | | | 69 | % | | | 68 | % | | | 74 | % | | | 71 | % |
Net assets, end of period(thousands) | | $ | 498,876 | | | $ | 432,097 | | | $ | 616,007 | | | $ | 453,477 | | | $ | 774,685 | |
See Accompanying Notes to the Financial Statements.
| | | | |
114 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Defensive Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 17.63 | | | $ | 23.82 | | | $ | 19.16 | | | $ | 21.87 | | | $ | 21.39 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.93 | | | | 0.99 | | | | 0.93 | | | | 0.74 | | | | 1.09 | |
Net Realized and Unrealized Gain(Loss) | | | 1.32 | | | | (6.14 | ) | | | 4.62 | | | | (2.70 | ) | | | 0.51 | |
| | | | |
Total from Operations | | | 2.25 | | | | (5.15 | ) | | | 5.55 | | | | (1.96 | ) | | | 1.60 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.95 | ) | | | (1.04 | ) | | | (0.89 | ) | | | (0.75 | ) | | | (1.12 | ) |
| | | | |
Total from Distributions | | | (0.95 | ) | | | (1.04 | ) | | | (0.89 | ) | | | (0.75 | ) | | | (1.12 | ) |
| | | | |
Net Asset Value, end of period | | $ | 18.93 | | | $ | 17.63 | | | $ | 23.82 | | | $ | 19.16 | | | $ | 21.87 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 12.54 | % | | | (22.06 | )% | | | 29.03 | % | | | (8.92 | )% | | | 7.66 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % |
Expenses net of reimbursements | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % |
Net Investment Income Before Reimbursements | | | 4.67 | % | | | 4.62 | % | | | 3.91 | % | | | 3.65 | % | | | 5.02 | % |
Net Investment Income Net of Reimbursements | | | 4.67 | % | | | 4.62 | % | | | 3.92 | % | | | 3.66 | % | | | 5.03 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 67 | % | | | 65 | % | | | 65 | % | | | 75 | % | | | 63 | % |
Net assets, end of period(thousands) | | $ | 26,503 | | | $ | 40,545 | | | $ | 71,459 | | | $ | 59,404 | | | $ | 78,719 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 115 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® International Quality Dividend Dynamic Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 21.31 | | | $ | 30.39 | | | $ | 22.38 | | | $ | 24.94 | | | $ | 23.51 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.28 | | | | 1.45 | | | | 1.28 | | | | 0.70 | | | | 1.05 | |
Net Realized and Unrealized Gain(Loss) | | | 2.91 | | | | (9.01 | ) | | | 7.63 | | | | (2.45 | ) | | | 1.52 | |
| | | | |
Total from Operations | | | 4.19 | | | | (7.56 | ) | | | 8.91 | | | | (1.75 | ) | | | 2.57 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.16 | ) | | | (1.52 | ) | | | (0.90 | ) | | | (0.81 | ) | | | (1.14 | ) |
| | | | |
Total from Distributions | | | (1.16 | ) | | | (1.52 | ) | | | (0.90 | ) | | | (0.81 | ) | | | (1.14 | ) |
| | | | |
Net Asset Value, end of period | | $ | 24.34 | | | $ | 21.31 | | | $ | 30.39 | | | $ | 22.38 | | | $ | 24.94 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 19.39 | % | | | (25.48 | )% | | | 39.87 | % | | | (6.99 | )% | | | 11.30 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % | | | 0.48 | % |
Expenses net of reimbursements | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % | | | 0.47 | % |
Net Investment Income Before Reimbursements | | | 4.96 | % | | | 5.49 | % | | | 4.24 | % | | | 2.90 | % | | | 4.36 | % |
Net Investment Income Net of Reimbursements | | | 4.96 | % | | | 5.49 | % | | | 4.25 | % | | | 2.91 | % | | | 4.37 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 78 | % | | | 74 | % | | | 72 | % | | | 85 | % | | | 88 | % |
Net assets, end of period(thousands) | | $ | 65,714 | | | $ | 61,788 | | | $ | 75,975 | | | $ | 22,376 | | | $ | 47,391 | |
See Accompanying Notes to the Financial Statements.
| | | | |
116 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 23.58 | | | $ | 26.38 | | | $ | 25.73 | | | $ | 24.58 | | | $ | 23.81 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.96 | | | | 1.72 | | | | 1.09 | | | | 0.33 | | | | 0.46 | |
Net Realized and Unrealized Gain(Loss) | | | (0.52 | ) | | | (2.83 | ) | | | 0.68 | | | | 1.09 | | | | 0.79 | |
| | | | |
Total from Operations | | | 0.44 | | | | (1.11 | ) | | | 1.77 | | | | 1.42 | | | | 1.25 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.85 | ) | | | (1.66 | ) | | | (1.12 | ) | | | (0.27 | ) | | | (0.48 | ) |
Tax Return of Capital | | | — | | | | (0.03 | ) | | | — | | | | — | | | | — | |
| | | | |
Total from Distributions | | | (0.85 | ) | | | (1.69 | ) | | | (1.12 | ) | | | (0.27 | ) | | | (0.48 | ) |
| | | | |
Net Asset Value, end of period | | $ | 23.17 | | | $ | 23.58 | | | $ | 26.38 | | | $ | 25.73 | | | $ | 24.58 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 1.84 | % | | | (4.44 | )% | | | 6.95 | % | | | 5.81 | % | | | 5.30 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % |
Expenses net of reimbursements | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % |
Net Investment Income Before Reimbursements | | | 4.08 | % | | | 6.82 | % | | | 4.14 | % | | | 1.33 | % | | | 1.89 | % |
Net Investment Income Net of Reimbursements | | | 4.08 | % | | | 6.83 | % | | | 4.15 | % | | | 1.33 | % | | | 1.89 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 63 | % | | | 116 | % | | | 53 | % | | | 71 | % | | | 52 | % |
Net assets, end of period(thousands) | | $ | 1,927,923 | | | $ | 2,157,939 | | | $ | 1,437,584 | | | $ | 1,429,491 | | | $ | 1,178,722 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 117 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 23.63 | | | $ | 28.02 | | | $ | 27.34 | | | $ | 25.50 | | | $ | 23.95 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.01 | | | | 1.83 | | | | 1.16 | | | | 0.36 | | | | 0.44 | |
Net Realized and Unrealized Gain(Loss) | | | (1.01 | ) | | | (4.35 | ) | | | 0.70 | | | | 1.76 | | | | 1.59 | |
| | | | |
Total from Operations | | | 0.00 | | | | (2.52 | ) | | | 1.86 | | | | 2.12 | | | | 2.03 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.87 | ) | | | (1.84 | ) | | | (1.18 | ) | | | (0.28 | ) | | | (0.48 | ) |
Tax Return of Capital | | | — | | | | (0.03 | ) | | | — | | | | — | | | | — | |
| | | | |
Total from Distributions | | | (0.87 | ) | | | (1.87 | ) | | | (1.18 | ) | | | (0.28 | ) | | | (0.48 | ) |
| | | | |
Net Asset Value, end of period | | $ | 22.76 | | | $ | 23.63 | | | $ | 28.02 | | | $ | 27.34 | | | $ | 25.50 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | (0.11 | )% | | | (9.46 | )% | | | 6.88 | % | | | 8.39 | % | | | 8.53 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % | | | 0.19 | % |
Expenses net of reimbursements | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % | | | 0.18 | % |
Net Investment Income Before Reimbursements | | | 4.26 | % | | | 6.98 | % | | | 4.17 | % | | | 1.35 | % | | | 1.77 | % |
Net Investment Income Net of Reimbursements | | | 4.27 | % | | | 6.98 | % | | | 4.17 | % | | | 1.35 | % | | | 1.78 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 52 | % | | | 80 | % | | | 46 | % | | | 66 | % | | | 41 | % |
Net assets, end of period(thousands) | | $ | 811,550 | | | $ | 643,886 | | | $ | 714,479 | | | $ | 596,095 | | | $ | 557,185 | |
See Accompanying Notes to the Financial Statements.
| | | | |
118 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Disciplined Duration MBS Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 20.04 | | | $ | 23.42 | | | $ | 24.10 | | | $ | 23.55 | | | $ | 22.74 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.55 | | | | 0.26 | | | | 0.09 | | | | 0.37 | | | | 0.61 | |
Net Realized and Unrealized Gain (Loss) | | | (0.34 | ) | | | (3.07 | ) | | | (0.16 | ) | | | 0.85 | | | | 1.03 | |
| | | | |
Total from Operations | | | 0.21 | | | | (2.81 | ) | | | (0.07 | ) | | | 1.22 | | | | 1.64 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.66 | ) | | | (0.57 | ) | | | (0.61 | ) | | | (0.67 | ) | | | (0.83 | ) |
| | | | |
Total from Distributions | | | (0.66 | ) | | | (0.57 | ) | | | (0.61 | ) | | | (0.67 | ) | | | (0.83 | ) |
| | | | |
Net Asset Value, end of period | | $ | 19.59 | | | $ | 20.04 | | | $ | 23.42 | | | $ | 24.10 | | | $ | 23.55 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 0.98 | % | | | (12.16 | )% | | | (0.28 | )% | | | 5.19 | % | | | 7.36 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.21 | % | | | 0.21 | % | | | 0.21 | % | | | 0.21 | % | | | 0.21 | % |
Expenses net of reimbursements | | | 0.20 | % | | | 0.20 | % | | | 0.20 | % | | | 0.20 | % | | | 0.20 | % |
Net Investment Income Before Reimbursements | | | 2.70 | % | | | 1.19 | % | | | 0.35 | % | | | 1.54 | % | | | 2.64 | % |
Net Investment Income Net of Reimbursements | | | 2.70 | % | | | 1.19 | % | | | 0.36 | % | | | 1.54 | % | | | 2.65 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 46 | % | | | 222 | % | | | 476 | % | | | 175 | % | | | 61 | % |
Net assets, end of period (thousands) | | $ | 74,424 | | | $ | 97,189 | | | $ | 111,243 | | | $ | 100,020 | | | $ | 35,330 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 119 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Credit-Scored US Corporate Bond Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 45.26 | | | $ | 53.52 | | | $ | 54.70 | | | $ | 52.58 | | | $ | 48.59 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.74 | | | | 1.04 | | | | 0.91 | | | | 1.32 | | | | 1.63 | |
Net Realized and Unrealized Gain (Loss) | | | 0.05 | | | | (7.83 | ) | | | (0.51 | ) | | | 2.39 | | | | 3.94 | |
| | | | |
Total from Operations | | | 1.79 | | | | (6.79 | ) | | | 0.40 | | | | 3.71 | | | | 5.57 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (1.67 | ) | | | (1.06 | ) | | | (0.96 | ) | | | (1.37 | ) | | | (1.58 | ) |
From Net Realized Gains | | | — | | | | (0.41 | ) | | | (0.62 | ) | | | (0.22 | ) | | | — | |
| | | | |
Total from Distributions | | | (1.67 | ) | | | (1.47 | ) | | | (1.58 | ) | | | (1.59 | ) | | | (1.58 | ) |
| | | | |
Net Asset Value, end of period | | $ | 45.38 | | | $ | 45.26 | | | $ | 53.52 | | | $ | 54.70 | | | $ | 52.58 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 3.92 | % | | | (12.91 | )% | | | 0.70 | % | | | 7.20 | % | | | 11.66 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % |
Expenses net of reimbursements | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % |
Net Investment Income Before Reimbursements | | | 3.74 | % | | | 2.11 | % | | | 1.68 | % | | | 2.46 | % | | | 3.20 | % |
Net Investment Income Net of Reimbursements | | | 3.74 | % | | | 2.11 | % | | | 1.69 | % | | | 2.46 | % | | | 3.21 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 121 | % | | | 66 | % | | | 53 | % | | | 62 | % | | | 65 | % |
Net assets, end of period (thousands) | | $ | 274,550 | | | $ | 242,139 | | | $ | 315,740 | | | $ | 202,397 | | | $ | 97,275 | |
See Accompanying Notes to the Financial Statements.
| | | | |
120 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Credit-Scored US Long Corporate Bond Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 39.44 | | | $ | 60.85 | | | $ | 61.81 | | | $ | 57.84 | | | $ | 48.04 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 2.14 | | | | 1.93 | | | | 1.90 | | | | 1.99 | | | | 2.11 | |
Net Realized and Unrealized Gain (Loss) | | | (1.33 | ) | | | (20.48 | ) | | | 1.22 | | | | 3.90 | | | | 9.89 | |
| | | | |
Total from Operations | | | 0.81 | | | | (18.55 | ) | | | 3.12 | | | | 5.89 | | | | 12.00 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (2.15 | ) | | | (1.92 | ) | | | (1.88 | ) | | | (1.92 | ) | | | (2.20 | ) |
From Net Realized Gains | | | — | | | | (0.94 | ) | | | (2.20 | ) | | | — | | | | — | |
| | | | |
Total from Distributions | | | (2.15 | ) | | | (2.86 | ) | | | (4.08 | ) | | | (1.92 | ) | | | (2.20 | ) |
| | | | |
Net Asset Value, end of period | | $ | 38.10 | | | $ | 39.44 | | | $ | 60.85 | | | $ | 61.81 | | | $ | 57.84 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 1.59 | %(i) | | | (31.58 | )% | | | 5.14 | % | | | 10.34 | % | | | 25.57 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % | | | 0.23 | % |
Expenses net of reimbursements | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % | | | 0.22 | % |
Net Investment Income Before Reimbursements | | | 5.01 | % | | | 3.86 | % | | | 3.13 | % | | | 3.27 | % | | | 4.06 | % |
Net Investment Income Net of Reimbursements | | | 5.02 | % | | | 3.86 | % | | | 3.14 | % | | | 3.28 | % | | | 4.07 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 103 | % | | | 58 | % | | | 88 | % | | | 74 | % | | | 44 | % |
Net assets, end of period (thousands) | | $ | 28,575 | | | $ | 35,498 | | | $ | 60,855 | | | $ | 46,360 | | | $ | 17,352 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 121 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® High Yield Value-Scored Bond Index Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 40.09 | | | $ | 49.58 | | | $ | 46.25 | | | $ | 47.85 | | | $ | 48.84 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 3.57 | | | | 2.98 | | | | 2.67 | | | | 3.12 | | | | 2.67 | |
Net Realized and Unrealized Gain (Loss) | | | (1.40 | ) | | | (9.24 | ) | | | 3.42 | | | | (1.77 | ) | | | 0.78 | |
| | | | |
Total from Operations | | | 2.17 | | | | (6.26 | ) | | | 6.09 | | | | 1.35 | | | | 3.45 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (3.52 | ) | | | (2.86 | ) | | | (2.76 | ) | | | (2.95 | ) | | | (3.57 | ) |
From Net Realized Gains | | | — | | | | (0.37 | ) | | | — | | | | — | | | | — | |
Tax Return of Capital | | | — | | | | — | | | | — | | | | — | | | | (0.87 | ) |
| | | | |
Total from Distributions | | | (3.52 | ) | | | (3.23 | ) | | | (2.76 | ) | | | (2.95 | ) | | | (4.44 | ) |
| | | | |
Net Asset Value, end of period | | $ | 38.74 | | | $ | 40.09 | | | $ | 49.58 | | | $ | 46.25 | | | $ | 47.85 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 5.45 | %(j) | | | (13.06 | )% | | | 13.38 | % | | | 3.07 | % | | | 7.48 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % | | | 0.38 | % |
Expenses net of reimbursements | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % | | | 0.37 | % |
Net Investment Income Before Reimbursements | | | 8.90 | % | | | 6.81 | % | | | 5.40 | % | | | 6.78 | % | | | 5.56 | % |
Net Investment Income Net of Reimbursements | | | 8.91 | % | | | 6.81 | % | | | 5.40 | % | | | 6.78 | % | | | 5.57 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 167 | % | | | 146 | % | | | 128 | % | | | 95 | % | | | 44 | % |
Net assets, end of period (thousands) | | $ | 1,222,307 | | | $ | 887,945 | | | $ | 575,184 | | | $ | 189,623 | | | $ | 100,480 | |
See Accompanying Notes to the Financial Statements.
| | | | |
122 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | |
| | FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | |
| | | | | | | | For the period 09/20/21* through 10/31/21 | |
| | | | | | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | |
| | | |
Net asset value, beginning of period | | $ | 38.59 | | | $ | 49.35 | | | $ | 50.00 | |
| | | | |
| | | |
PER SHARE | | | | | | | | | | | | |
| | | |
Investment Operations | | | | | | | | | | | | |
Net Investment Income(a) | | | 1.61 | | | | 1.07 | | | | 0.10 | |
Net Realized and Unrealized Gain (Loss) | | | (0.62 | ) | | | (10.68 | ) | | | (0.75 | ) |
| | | | |
Total from Operations | | | 0.99 | | | | (9.61 | ) | | | (0.65 | ) |
| | | | |
Distributions | | | | | | | | | | | | |
Net Investment Income | | | (1.62 | ) | | | (1.15 | ) | | | — | |
| | | | |
Total from Distributions | | | (1.62 | ) | | | (1.15 | ) | | | — | |
| | | | |
Net Asset Value, end of period | | $ | 37.96 | | | $ | 38.59 | | | $ | 49.35 | |
| | | | |
Total Return(b) | | | | | | | | | | | | |
Net Asset Value(d) | | | 2.41 | % | | | (19.73 | )% | | | (1.32 | )% |
| | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | |
|
Ratios to Average Net Assets(c) | |
Expenses | | | 0.13 | % | | | 0.13 | % | | | 0.12 | % |
Expenses net of reimbursements | | | 0.12 | % | | | 0.12 | % | | | 0.12 | % |
Net Investment Income Before Reimbursements | | | 4.00 | % | | | 2.41 | % | | | 1.81 | % |
Net Investment Income Net of Reimbursements | | | 4.00 | % | | | 2.41 | % | | | 1.81 | % |
| | | |
Supplemental Data | | | | | | | | | | | | |
Portfolio Turnover Rate(b)(e) | | | 87 | % | | | 66 | % | | | 8 | % |
Net assets, end of period(thousands) | | $ | 24,672 | | | $ | 23,156 | | | $ | 49,347 | |
* | Commencement of investment operations. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 123 | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Ultra-Short Income Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 74.30 | | | $ | 76.01 | | | $ | 76.29 | | | $ | 75.89 | | | $ | 75.48 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 3.24 | | | | 1.07 | | | | 0.48 | | | | 1.07 | | | | 1.98 | |
Net Realized and Unrealized Gain (Loss) | | | 0.59 | | | | (1.80 | ) | | | (0.22 | ) | | | 0.57 | | | | 0.41 | |
| | | | |
Total from Operations | | | 3.83 | | | | (0.73 | ) | | | 0.26 | | | | 1.64 | | | | 2.39 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (3.02 | ) | | | (0.78 | ) | | | (0.52 | ) | | | (1.23 | ) | | | (1.98 | ) |
From Net Realized Gains | | | — | | | | (0.20 | ) | | | (0.02 | ) | | | (0.01 | ) | | | — | |
| | | | |
Total from Distributions | | | (3.02 | ) | | | (0.98 | ) | | | (0.54 | ) | | | (1.24 | ) | | | (1.98 | ) |
| | | | |
Net Asset Value, end of period | | $ | 75.11 | | | $ | 74.30 | | | $ | 76.01 | | | $ | 76.29 | | | $ | 75.89 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | 5.27 | % | | | (0.94 | )% | | | 0.34 | % | | | 2.18 | % | | | 3.21 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % | | | 0.26 | % |
Expenses net of reimbursements | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % | | | 0.25 | % |
Net Investment Income Before Reimbursements | | | 4.33 | % | | | 1.43 | % | | | 0.62 | % | | | 1.41 | % | | | 2.61 | % |
Net Investment Income Net of Reimbursements | | | 4.33 | % | | | 1.43 | % | | | 0.63 | % | | | 1.41 | % | | | 2.62 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 37 | % | | | 50 | % | | | 84 | % | | | 79 | % | | | 73 | % |
Net assets, end of period(thousands) | | $ | 1,076,389 | | | $ | 856,357 | | | $ | 374,339 | | | $ | 469,201 | | | $ | 275,097 | |
See Accompanying Notes to the Financial Statements.
| | | | |
124 | | FLEXSHARES ANNUAL REPORT | | |
Financial Highlights (cont.)
| | | | | | | | | | | | | | | | | | | | |
| | FlexShares® Core Select Bond Fund | |
| | Year ended October 31, | |
| | 2023 | | | 2022 | | | 2021 | | | 2020 | | | 2019 | |
| | | | | |
Net asset value, beginning of period | | $ | 21.46 | | | $ | 26.22 | | | $ | 26.78 | | | $ | 25.66 | | | $ | 23.74 | |
| | | | |
| | | | | |
PER SHARE | | | | | | | | | | | | | | | | | | | | |
| | | | | |
Investment Operations | | | | | | | | | | | | | | | | | | | | |
Net Investment Income(a) | | | 0.65 | | | | 0.53 | | | | 0.46 | | | | 0.51 | | | | 0.73 | |
Net Realized and Unrealized Gain (Loss) | | | (0.66 | ) | | | (4.75 | ) | | | (0.39 | ) | | | 1.19 | | | | 1.93 | |
| | | | |
Total from Operations | | | (0.01 | ) | | | (4.22 | ) | | | 0.07 | | | | 1.70 | | | | 2.66 | |
| | | | |
Distributions | | | | | | | | | | | | | | | | | | | | |
Net Investment Income | | | (0.66 | ) | | | (0.54 | ) | | | (0.52 | ) | | | (0.58 | ) | | | (0.74 | ) |
From Net Realized Gains | | | — | | | | — | | | | (0.11 | ) | | | — | | | | — | |
| | | | |
Total from Distributions | | | (0.66 | ) | | | (0.54 | ) | | | (0.63 | ) | | | (0.58 | ) | | | (0.74 | ) |
| | | | |
Net Asset Value, end of period | | $ | 20.79 | | | $ | 21.46 | | | $ | 26.22 | | | $ | 26.78 | | | $ | 25.66 | |
| | | | |
Total Return | | | | | | | | | | | | | | | | | | | | |
Net Asset Value(d) | | | (0.15 | )% | | | (16.27 | )% | | | 0.26 | % | | | 6.69 | % | | | 11.38 | % |
| | | | | |
RATIOS/SUPPLEMENT DATA | | | | | | | | | | | | | | | | | | | | |
|
Ratios to Average Net Assets | |
Expenses | | | 0.36 | %(h) | | | 0.36 | %(h) | | | 0.36 | %(h) | | | 0.36 | %(h) | | | 0.36 | %(h) |
Expenses net of reimbursements | | | 0.25 | %(h) | | | 0.22 | %(h) | | | 0.20 | %(h) | | | 0.20 | %(h) | | | 0.19 | %(h) |
Net Investment Income Before Reimbursements | | | 2.87 | % | | | 2.10 | % | | | 1.56 | % | | | 1.76 | % | | | 2.80 | % |
Net Investment Income Net of Reimbursements | | | 2.98 | % | | | 2.24 | % | | | 1.72 | % | | | 1.93 | % | | | 2.97 | % |
| | | | | |
Supplemental Data | | | | | | | | | | | | | | | | | | | | |
Portfolio Turnover Rate(e) | | | 26 | % | | | 121 | % | | | 50 | % | | | 91 | % | | | 135 | % |
Net assets, end of period(thousands) | | $ | 182,431 | | | $ | 159,362 | | | $ | 126,517 | | | $ | 109,123 | | | $ | 26,299 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 125 | |
Financial Highlights (cont.)
(a) | Net investment income per share is based on average shares outstanding. |
(b) | Not annualized for periods less than one year. |
(c) | Annualized for periods less than one year. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period and redemption on the last day of the period at adjusted net asset value. |
(e) | In-kind transactions are not included in portfolio turnover calculations. |
(f) | Northern Trust Investments, Inc. voluntarily reimbursed expenses of the Fund in the amount of approximately $16,693. Total return excluding the voluntary reimbursement would have been 13.62% (see Note 4). |
(h) | The Fund indirectly bears its proportionate share of fees and expenses incurred by the Underlying Fund(s) in which the Fund is invested. This ratio does not include these indirect fees and expenses. |
(i) | Northern Trust Investments, Inc. voluntarily reimbursed expenses of the Fund in the amount of approximately $2,167. Total return excluding the voluntary reimbursement would have been 1.59% (see Note 4). |
(j) | Northern Trust Investments, Inc. voluntarily reimbursed expenses of the Fund in the amount of approximately $84,821. Total return excluding the voluntary reimbursement would have been 5.44% (see Note 4). |
See Accompanying Notes to the Financial Statements.
| | | | |
126 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® US Quality Low Volatility Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.8% | |
|
Aerospace & Defense – 2.8% | |
| | |
General Dynamics Corp. | | | 1,872 | | | $ | 451,732 | |
| | |
Huntington Ingalls Industries, Inc.(a) | | | 4,608 | | | | 1,012,931 | |
| | |
Lockheed Martin Corp. | | | 5,184 | | | | 2,356,854 | |
| | |
Northrop Grumman Corp. | | | 2,880 | | | | 1,357,718 | |
| | | | | | | 5,179,235 | |
|
Air Freight & Logistics – 1.7% | |
| | |
CH Robinson Worldwide, Inc. | | | 14,400 | | | | 1,178,352 | |
| | |
Expeditors International of Washington, Inc. | | | 13,392 | | | | 1,463,076 | |
| | |
United Parcel Service, Inc., Class B | | | 4,176 | | | | 589,860 | |
| | | | | | | 3,231,288 | |
|
Automobiles – 0.5% | |
| | |
Tesla, Inc.* | | | 4,896 | | | | 983,313 | |
|
Banks – 0.0%(b) | |
| | |
JPMorgan Chase & Co. | | | 432 | | | | 60,074 | |
|
Beverages – 2.0% | |
| | |
PepsiCo, Inc. | | | 22,320 | | | | 3,644,410 | |
|
Biotechnology – 6.4% | |
| | |
AbbVie, Inc. | | | 3,024 | | | | 426,928 | |
| | |
Amgen, Inc. | | | 12,384 | | | | 3,166,589 | |
| | |
Biogen, Inc.* | | | 6,192 | | | | 1,470,848 | |
| | |
BioMarin Pharmaceutical, Inc.* | | | 6,336 | | | | 516,067 | |
| | |
Gilead Sciences, Inc. | | | 28,512 | | | | 2,239,333 | |
| | |
Regeneron Pharmaceuticals, Inc.* | | | 2,461 | | | | 1,919,309 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 5,904 | | | | 2,137,897 | |
| | | | | | | 11,876,971 | |
|
Broadline Retail – 0.3% | |
| | |
Dillard’s, Inc., Class A(a) | | | 1,728 | | | | 536,458 | |
|
Capital Markets – 1.0% | |
| | |
CME Group, Inc. | | | 8,784 | | | | 1,875,033 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – 0.5% | |
| | |
Ashland, Inc. | | | 9,360 | | | $ | 717,257 | |
| | |
Linde plc | | | 576 | | | | 220,124 | |
| | | | | | | 937,381 | |
|
Commercial Services & Supplies – 2.4% | |
| | |
Republic Services, Inc., Class A | | | 7,632 | | | | 1,133,276 | |
| | |
Tetra Tech, Inc.(a) | | | 6,336 | | | | 956,166 | |
| | |
Waste Connections, Inc. | | | 8,208 | | | | 1,062,936 | |
| | |
Waste Management, Inc. | | | 7,920 | | | | 1,301,493 | |
| | | | | | | 4,453,871 | |
|
Consumer Staples Distribution & Retail – 1.7% | |
| | |
Costco Wholesale Corp. | | | 2,889 | | | | 1,595,999 | |
| | |
Kroger Co. (The) | | | 32,400 | | | | 1,469,988 | |
| | | | | | | 3,065,987 | |
|
Containers & Packaging – 1.7% | |
| | |
AptarGroup, Inc. | | | 7,488 | | | | 915,558 | |
| | |
Packaging Corp. of America | | | 10,368 | | | | 1,586,822 | |
| | |
Sonoco Products Co. | | | 12,960 | | | | 671,458 | |
| | | | | | | 3,173,838 | |
|
Diversified Consumer Services – 1.0% | |
| | |
Grand Canyon Education, Inc.* | | | 8,496 | | | | 1,005,331 | |
| | |
Service Corp. International(a) | | | 15,264 | | | | 830,667 | |
| | | | | | | 1,835,998 | |
|
Diversified Telecommunication Services – 2.3% | |
| | |
AT&T, Inc. | | | 101,520 | | | | 1,563,408 | |
| | |
Iridium Communications, Inc. | | | 26,640 | | | | 987,012 | |
| | |
Verizon Communications, Inc. | | | 48,528 | | | | 1,704,789 | |
| | | | | | | 4,255,209 | |
|
Electric Utilities – 3.2% | |
| | |
American Electric Power Co., Inc. | | | 13,104 | | | | 989,876 | |
| | |
Constellation Energy Corp. | | | 2,880 | | | | 325,210 | |
| | |
Duke Energy Corp. | | | 19,008 | | | | 1,689,621 | |
| | |
Eversource Energy | | | 14,256 | | | | 766,830 | |
| | |
Pinnacle West Capital Corp. | | | 12,960 | | | | 961,373 | |
| | |
Xcel Energy, Inc. | | | 19,296 | | | | 1,143,674 | |
| | | | | | | 5,876,584 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 127 | |
FlexShares® US Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Entertainment – 0.7% | |
| | |
Electronic Arts, Inc. | | | 3,168 | | | $ | 392,167 | |
| | |
Madison Square Garden Sports Corp.* | | | 5,616 | | | | 944,274 | |
| | | | | | | 1,336,441 | |
|
Financial Services – 5.2% | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 15,264 | | | | 5,210,061 | |
| | |
Visa, Inc., Class A(a) | | | 18,576 | | | | 4,367,218 | |
| | | | | | | 9,577,279 | |
|
Food Products – 2.4% | |
| | |
Flowers Foods, Inc. | | | 17,280 | | | | 378,950 | |
| | |
General Mills, Inc. | | | 1,440 | | | | 93,946 | |
| | |
Hershey Co. (The) | | | 5,040 | | | | 944,244 | |
| | |
Hormel Foods Corp. | | | 22,608 | | | | 735,890 | |
| | |
J M Smucker Co. (The) | | | 7,344 | | | | 836,041 | |
| | |
Lancaster Colony Corp. | | | 8,064 | | | | 1,364,187 | |
| | | | | | | 4,353,258 | |
|
Gas Utilities – 0.8% | |
| | |
Atmos Energy Corp.(a) | | | 6,480 | | | | 697,637 | |
| | |
Spire, Inc.(a) | | | 13,536 | | | | 753,007 | |
| | | | | | | 1,450,644 | |
|
Ground Transportation – 2.0% | |
| | |
JB Hunt Transport Services, Inc. | | | 5,328 | | | | 915,724 | |
| | |
Landstar System, Inc.(a) | | | 7,776 | | | | 1,281,329 | |
| | |
Old Dominion Freight Line, Inc. | | | 4,032 | | | | 1,518,693 | |
| | | | | | | 3,715,746 | |
|
Health Care Equipment & Supplies – 1.3% | |
| | |
Abbott Laboratories | | | 26,352 | | | | 2,491,582 | |
|
Health Care Providers & Services – 1.2% | |
| | |
Chemed Corp.(a) | | | 2,892 | | | | 1,627,184 | |
| | |
Laboratory Corp. of America Holdings | | | 1,008 | | | | 201,328 | |
| | |
UnitedHealth Group, Inc. | | | 576 | | | | 308,482 | |
| | | | | | | 2,136,994 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotels, Restaurants & Leisure – 3.0% | |
| | |
McDonald’s Corp. | | | 15,552 | | | $ | 4,077,268 | |
| | |
Restaurant Brands International, Inc.(a) | | | 22,320 | | | | 1,499,904 | |
| | | | | | | 5,577,172 | |
|
Household Products – 3.1% | |
| | |
Clorox Co. (The) | | | 8,640 | | | | 1,016,928 | |
| | |
Procter & Gamble Co. (The) | | | 25,920 | | | | 3,888,778 | |
| | |
WD-40 Co.(a) | | | 4,320 | | | | 913,248 | |
| | | | | | | 5,818,954 | |
|
Insurance – 6.3% | |
| | |
Allstate Corp. (The) | | | 14,976 | | | | 1,918,875 | |
| | |
American Financial Group, Inc. | | | 12,960 | | | | 1,417,305 | |
| | |
Assurant, Inc. | | | 10,512 | | | | 1,565,237 | |
| | |
Chubb Ltd. | | | 6,624 | | | | 1,421,643 | |
| | |
Erie Indemnity Co., Class A | | | 3,600 | | | | 994,284 | |
| | |
Markel Group, Inc.* | | | 720 | | | | 1,058,774 | |
| | |
RLI Corp. | | | 7,488 | | | | 997,701 | |
| | |
Travelers Cos., Inc. (The) | | | 7,056 | | | | 1,181,457 | |
| | |
W R Berkley Corp. | | | 16,704 | | | | 1,126,184 | |
| | | | | | | 11,681,460 | |
|
Interactive Media & Services – 2.0% | |
| | |
Alphabet, Inc., Class A* | | | 12,240 | | | | 1,518,739 | |
| | |
Alphabet, Inc., Class C* | | | 9,072 | | | | 1,136,722 | |
| | |
Meta Platforms, Inc., Class A* | | | 3,600 | | | | 1,084,572 | |
| | | | | | | 3,740,033 | |
|
IT Services – 1.7% | |
| | |
Amdocs Ltd. | | | 17,280 | | | | 1,385,165 | |
| | |
International Business Machines Corp. | | | 11,808 | | | | 1,707,909 | |
| | | | | | | 3,093,074 | |
|
Life Sciences Tools & Services – 0.5% | |
| | |
ICON plc* | | | 144 | | | | 35,130 | |
| | |
QIAGEN NV* | | | 23,184 | | | | 867,777 | |
| | | | | | | 902,907 | |
|
Metals & Mining – 0.8% | |
| | |
Newmont Corp. | | | 41,760 | | | | 1,564,747 | |
See Accompanying Notes to the Financial Statements.
| | | | |
128 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® US Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Multi-Utilities – 2.5% | |
| | |
Ameren Corp. | | | 13,248 | | | $ | 1,003,006 | |
| | |
CMS Energy Corp.(a) | | | 18,432 | | | | 1,001,595 | |
| | |
Consolidated Edison, Inc. | | | 17,856 | | | | 1,567,578 | |
| | |
WEC Energy Group, Inc. | | | 12,816 | | | | 1,043,094 | |
| | | | | | | 4,615,273 | |
|
Oil, Gas & Consumable Fuels – 1.3% | |
| | |
Chesapeake Energy Corp.(a) | | | 5,328 | | | | 458,634 | |
| | |
Chevron Corp. | | | 2,160 | | | | 314,777 | |
| | |
Coterra Energy, Inc. | | | 42,480 | | | | 1,168,200 | |
| | |
Exxon Mobil Corp. | | | 4,032 | | | | 426,787 | |
| | | | | | | 2,368,398 | |
|
Pharmaceuticals – 7.9% | |
| | |
Eli Lilly & Co. | | | 12,096 | | | | 6,700,337 | |
| | |
Johnson & Johnson | | | 20,592 | | | | 3,054,617 | |
| | |
Merck & Co., Inc. | | | 47,952 | | | | 4,924,671 | |
| | | | | | | 14,679,625 | |
|
Professional Services – 2.2% | |
| | |
Automatic Data Processing, Inc. | | | 7,344 | | | | 1,602,608 | |
| | |
CACI International, Inc., Class A* | | | 3,024 | | | | 982,074 | |
| | |
Verisk Analytics, Inc., Class A | | | 6,336 | | | | 1,440,553 | |
| | | | | | | 4,025,235 | |
|
Residential REITs – 0.2% | |
| | |
Essex Property Trust, Inc., REIT | | | 1,872 | | | | 400,458 | |
|
Semiconductors & Semiconductor Equipment – 2.7% | |
| | |
Broadcom, Inc. | | | 715 | | | | 601,579 | |
| | |
NVIDIA Corp. | | | 7,275 | | | | 2,966,745 | |
| | |
Texas Instruments, Inc. | | | 10,368 | | | | 1,472,360 | |
| | | | | | | 5,040,684 | |
|
Software – 12.8% | |
| | |
Cadence Design Systems, Inc.* | | | 3,024 | | | | 725,306 | |
| | |
Check Point Software Technologies Ltd.* | | | 11,376 | | | | 1,527,228 | |
| | |
Dolby Laboratories, Inc., Class A | | | 8,640 | | | | 699,322 | |
| | |
Microsoft Corp. | | | 45,792 | | | | 15,482,733 | |
| | |
Qualys, Inc.* (a) | | | 9,360 | | | | 1,431,612 | |
| | |
Roper Technologies, Inc. | | | 3,456 | | | | 1,688,498 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Software – (continued) | |
| | |
SPS Commerce, Inc.* | | | 2,016 | | | $ | 323,245 | |
| | |
Tyler Technologies, Inc.* | | | 4,032 | | | | 1,503,533 | |
| | |
VMware, Inc., Class A* | | | 2,465 | | | | 359,027 | |
| | | | | | | 23,740,504 | |
|
Specialized REITs – 1.4% | |
| | |
Equinix, Inc., REIT | | | 1,728 | | | | 1,260,818 | |
| | |
Public Storage, REIT | | | 5,472 | | | | 1,306,221 | |
| | | | | | | 2,567,039 | |
|
Specialty Retail – 3.0% | |
| | |
AutoZone, Inc.* | | | 176 | | | | 435,975 | |
| | |
Home Depot, Inc. (The) | | | 8,496 | | | | 2,418,726 | |
| | |
O’Reilly Automotive, Inc.* | | | 1,837 | | | | 1,709,218 | |
| | |
Tractor Supply Co. | | | 5,040 | | | | 970,503 | |
| | | | | | | 5,534,422 | |
|
Technology Hardware, Storage & Peripherals – 5.7% | |
| | |
Apple, Inc. | | | 61,632 | | | | 10,524,897 | |
|
Tobacco – 0.8% | |
| | |
Altria Group, Inc. | | | 36,000 | | | | 1,446,120 | |
|
Wireless Telecommunication Services – 0.8% | |
| | |
T-Mobile US, Inc.* | | | 9,792 | | | | 1,408,677 | |
Total Common Stocks (Cost $173,325,857) | | | | 184,777,273 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 1.5%(c) | |
|
REPURCHASE AGREEMENTS – 1.5% | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $2,684,389, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $2,706,537 (Cost $2,683,994) | | $ | 2,683,994 | | | | 2,683,994 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 129 | |
FlexShares® US Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SHORT-TERM INVESTMENTS – 0.0%(b)(d)(e) | |
|
U.S. TREASURY OBLIGATIONS – 0.0% | |
| | |
U.S. Treasury Bills 5.43%, 4/11/2024 (Cost $19,524) | | $ | 20,000 | | | $ | 19,522 | |
Total Investments – 101.3% (Cost $176,029,375) | | | | 187,480,789 | |
| |
Liabilities in excess of other assets – (1.3%) | | | | (2,476,169 | ) |
NET ASSETS – 100.0% | | | $ | 185,004,620 | |
* | Non-income producing security. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $13,821,520, collateralized in the form of cash with a value of $2,683,994 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $11,006,326 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $327,945 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – |
| 4.25%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $14,018,264. |
(b) | Represents less than 0.05% of net assets. |
(c) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $2,683,994. |
(d) | All or a portion of the security pledged as collateral for Futures Contracts. |
(e) | The rate shown was the current yield as of October 31, 2023. |
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 19,540,583 | |
Aggregate gross unrealized depreciation | | | (8,248,947 | ) |
Net unrealized appreciation | | $ | 11,291,636 | |
Federal income tax cost | | $ | 176,191,118 | |
Futures Contracts
FlexShares® US Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Appreciation/ (Depreciation)* | |
Long Contracts | |
S&P 500 E-Mini Index | | | 1 | | | | 12/15/2023 | | | | USD | | | $ | 210,612 | | | $ | 2,310 | |
S&P 500 Micro E-Mini Index | | | 7 | | | | 12/15/2023 | | | | USD | | | | 147,429 | | | | (345 | ) |
| | | | | | | | | | | | | | | | | | $ | 1,965 | |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.8 | % |
Securities Lending Reinvestments | | | 1.5 | |
Short-Term Investments | | | 0.0 | † |
Others(1) | | | (1.3 | ) |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
130 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 97.6% | |
|
Aerospace & Defense – 2.3% | |
| | |
BAE Systems plc(a) | | | 51,828 | | | $ | 694,313 | |
| | |
Dassault Aviation SA | | | 1,400 | | | | 277,463 | |
| | |
Thales SA | | | 3,976 | | | | 584,796 | |
| | | | | | | 1,556,572 | |
|
Air Freight & Logistics – 0.8% | |
| | |
Yamato Holdings Co. Ltd. | | | 30,800 | | | | 509,249 | |
|
Automobile Components – 0.2% | |
| | |
Bridgestone Corp. | | | 2,800 | | | | 104,775 | |
|
Automobiles – 1.0% | |
| | |
Ferrari NV | | | 2,212 | | | | 667,523 | |
|
Banks – 12.8% | |
| | |
Bank Hapoalim BM | | | 67,676 | | | | 482,952 | |
| | |
Bank Leumi Le-Israel BM | | | 69,664 | | | | 447,545 | |
| | |
Banque Cantonale Vaudoise (Registered) | | | 5,012 | | | | 565,058 | |
| | |
BOC Hong Kong Holdings Ltd. | | | 210,000 | | | | 555,556 | |
| | |
DBS Group Holdings Ltd. | | | 30,800 | | | | 738,499 | |
| | |
Hang Seng Bank Ltd. | | | 22,400 | | | | 256,647 | |
| | |
HSBC Holdings plc | | | 10,696 | | | | 76,875 | |
| | |
Japan Post Bank Co. Ltd. | | | 70,000 | | | | 646,868 | |
| | |
Mizrahi Tefahot Bank Ltd. | | | 14,952 | | | | 461,989 | |
| | |
Mizuho Financial Group, Inc. | | | 39,200 | | | | 658,877 | |
| | |
Oversea-Chinese Banking Corp. Ltd. | | | 56,000 | | | | 518,288 | |
| | |
Resona Holdings, Inc. | | | 53,200 | | | | 282,256 | |
| | |
Royal Bank of Canada | | | 12,292 | | | | 980,704 | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | 21,300 | | | | 1,015,458 | |
| | |
Toronto-Dominion Bank (The) | | | 6,944 | | | | 387,453 | |
| | |
United Overseas Bank Ltd. | | | 19,600 | | | | 386,549 | |
| | | | | | | 8,461,574 | |
|
Beverages – 0.7% | |
| | |
Budweiser Brewing Co. APAC Ltd.(b) | | | 168,000 | | | | 319,485 | |
| | |
Suntory Beverage & Food Ltd. | | | 5,600 | | | | 165,583 | |
| | | | | | | 485,068 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Biotechnology – 0.2% | |
| | |
Genmab A/S* | | | 532 | | | $ | 149,926 | |
|
Broadline Retail – 2.2% | |
| | |
Dollarama, Inc. | | | 5,208 | | | | 355,266 | |
| | |
Pan Pacific International Holdings Corp. | | | 28,000 | | | | 537,370 | |
| | |
Wesfarmers Ltd. | | | 18,088 | | | | 578,576 | |
| | | | | | | 1,471,212 | |
|
Capital Markets – 1.7% | |
| | |
Deutsche Boerse AG | | | 3,640 | | | | 597,129 | |
| | |
Singapore Exchange Ltd. | | | 78,400 | | | | 541,913 | |
| | | | | | | 1,139,042 | |
|
Chemicals – 2.3% | |
| | |
Air Liquide SA | | | 6,692 | | | | 1,143,635 | |
| | |
ICL Group Ltd. | | | 84,672 | | | | 410,221 | |
| | | | | | | 1,553,856 | |
|
Commercial Services & Supplies – 1.6% | |
| | |
Brambles Ltd. | | | 26,936 | | | | 223,585 | |
| | |
Dai Nippon Printing Co. Ltd. | | | 9,500 | | | | 245,208 | |
| | |
Secom Co. Ltd. | | | 8,400 | | | | 579,616 | |
| | | | | | | 1,048,409 | |
|
Construction & Engineering – 0.3% | |
| | |
Obayashi Corp. | | | 11,200 | | | | 95,253 | |
| | |
Taisei Corp. | | | 2,800 | | | | 94,273 | |
| | | | | | | 189,526 | |
|
Consumer Staples Distribution & Retail – 2.7% | |
| | |
Carrefour SA | | | 1,400 | | | | 24,535 | |
| | |
Jeronimo Martins SGPS SA | | | 13,692 | | | | 315,210 | |
| | |
Koninklijke Ahold Delhaize NV | | | 19,992 | | | | 591,683 | |
| | |
Loblaw Cos. Ltd. | | | 3,276 | | | | 267,649 | |
| | |
Metro, Inc., Class A | | | 11,312 | | | | 573,973 | |
| | | | | | | 1,773,050 | |
|
Containers & Packaging – 0.3% | |
| | |
CCL Industries, Inc., Class B | | | 5,096 | | | | 199,031 | |
|
Diversified Consumer Services – 0.1% | |
| | |
Pearson plc | | | 3,892 | | | | 44,942 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 131 | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (cont.)
��
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Diversified Telecommunication Services – 5.0% | |
| | |
BCE, Inc. | | | 784 | | | $ | 29,110 | |
| | |
Deutsche Telekom AG (Registered) | | | 21,112 | | | | 456,907 | |
| | |
Elisa OYJ | | | 11,312 | | | | 479,228 | |
| | |
Koninklijke KPN NV | | | 164,752 | | | | 552,904 | |
| | |
Nippon Telegraph & Telephone Corp. | | | 498,400 | | | | 581,842 | |
| | |
Orange SA | | | 32,760 | | | | 384,709 | |
| | |
Singapore Telecommunications Ltd. | | | 81,200 | | | | 141,058 | |
| | |
Swisscom AG (Registered) | | | 980 | | | | 585,814 | |
| | |
Telefonica Deutschland Holding AG | | | 72,184 | | | | 122,345 | |
| | | | | | | 3,333,917 | |
|
Electric Utilities – 4.7% | |
| | |
Chubu Electric Power Co., Inc. | | | 14,000 | | | | 168,477 | |
| | |
CLP Holdings Ltd. | | | 41,000 | | | | 299,983 | |
| | |
Emera, Inc.(a) | | | 1,568 | | | | 51,301 | |
| | |
Fortis, Inc.(a) | | | 7,732 | | | | 306,662 | |
| | |
Hydro One Ltd.(a) (b) | | | 20,020 | | | | 518,580 | |
| | |
Iberdrola SA | | | 59,556 | | | | 660,982 | |
| | |
Kansai Electric Power Co., Inc. (The) | | | 22,400 | | | | 284,946 | |
| | |
Power Assets Holdings Ltd. | | | 51,000 | | | | 243,770 | |
| | |
Redeia Corp. SA | | | 35,280 | | | | 548,364 | |
| | | | | | | 3,083,065 | |
|
Entertainment – 0.5% | |
| | |
Nintendo Co. Ltd. | | | 2,800 | | | | 115,017 | |
| | |
Toho Co. Ltd. | | | 6,600 | | | | 223,610 | |
| | | | | | | 338,627 | |
|
Food Products – 5.7% | |
| | |
JDE Peet’s NV(a) | | | 4,060 | | | | 112,607 | |
| | |
MEIJI Holdings Co. Ltd. | | | 10,400 | | | | 255,322 | |
| | |
Nestle SA (Registered) | | | 26,376 | | | | 2,842,075 | |
| | |
Nissin Foods Holdings Co. Ltd. | | | 2,200 | | | | 191,026 | |
| | |
Yakult Honsha Co. Ltd. | | | 16,200 | | | | 380,491 | |
| | | | | | | 3,781,521 | |
|
Gas Utilities – 1.4% | |
| | |
Naturgy Energy Group SA(a) | | | 3,668 | | | | 103,518 | |
| | |
Osaka Gas Co. Ltd. | | | 16,800 | | | | 315,267 | |
| | |
Snam SpA | | | 51,548 | | | | 235,925 | |
| | |
Tokyo Gas Co. Ltd. | | | 12,400 | | | | 276,666 | |
| | | | | | | 931,376 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Ground Transportation – 4.3% | |
| | |
Canadian National Railway Co. | | | 8,568 | | | $ | 905,588 | |
| | |
Central Japan Railway Co. | | | 12,500 | | | | 280,300 | |
| | |
East Japan Railway Co. | | | 5,600 | | | | 291,084 | |
| | |
Hankyu Hanshin Holdings, Inc. | | | 8,400 | | | | 262,186 | |
| | |
Keisei Electric Railway Co. Ltd. | | | 7,100 | | | | 265,210 | |
| | |
Kintetsu Group Holdings Co. Ltd. | | | 8,400 | | | | 235,119 | |
| | |
Tobu Railway Co. Ltd.(a) | | | 19,600 | | | | 469,018 | |
| | |
West Japan Railway Co. | | | 3,400 | | | | 129,000 | |
| | | | | | | 2,837,505 | |
|
Health Care Providers & Services – 0.2% | |
| | |
Fresenius Medical Care AG & Co. KGaA | | | 3,080 | | | | 101,964 | |
|
Hotels, Restaurants & Leisure – 0.7% | |
| | |
Compass Group plc | | | 3,220 | | | | 80,998 | |
| | |
Genting Singapore Ltd. | | | 352,800 | | | | 221,458 | |
| | |
La Francaise des Jeux SAEM(b) | | | 952 | | | | 30,610 | |
| | |
Sodexo SA | | | 1,512 | | | | 159,627 | |
| | | | | | | 492,693 | |
|
Household Durables – 1.1% | |
| | |
Sekisui Chemical Co. Ltd. | | | 35,800 | | | | 485,544 | |
| | |
Sekisui House Ltd. | | | 14,000 | | | | 271,689 | |
| | | | | | | 757,233 | |
|
Household Products – 0.8% | |
| | |
Henkel AG & Co. KGaA | | | 168 | | | | 10,594 | |
| | |
Reckitt Benckiser Group plc | | | 7,504 | | | | 500,997 | |
| | | | | | | 511,591 | |
|
Independent Power and Renewable Electricity Producers – 0.0%(c) | |
| | |
Meridian Energy Ltd. | | | 11,480 | | | | 32,252 | |
|
Industrial Conglomerates – 1.7% | |
| | |
CK Hutchison Holdings Ltd. | | | 56,000 | | | | 283,056 | |
| | |
Jardine Cycle & Carriage Ltd. | | | 22,400 | | | | 461,063 | |
| | |
Jardine Matheson Holdings Ltd. | | | 5,600 | | | | 226,520 | |
| | |
Keppel Corp. Ltd. | | | 30,800 | | | | 139,607 | |
| | | | | | | 1,110,246 | |
|
Insurance – 3.4% | |
| | |
Fairfax Financial Holdings Ltd. | | | 364 | | | | 302,587 | |
| | |
Hannover Rueck SE | | | 1,400 | | | | 308,242 | |
See Accompanying Notes to the Financial Statements.
| | | | |
132 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Insurance Australia Group Ltd. | | | 45,416 | | | $ | 163,042 | |
| | |
Medibank Pvt Ltd. | | | 249,872 | | | | 542,648 | |
| | |
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | | | 196 | | | | 78,415 | |
| | |
Sampo OYJ, Class A | | | 12,376 | | | | 485,452 | |
| | |
Talanx AG | | | 1,764 | | | | 110,847 | |
| | |
Zurich Insurance Group AG | | | 588 | | | | 278,219 | |
| | | | | | | 2,269,452 | |
|
IT Services – 2.1% | |
| | |
CGI, Inc.* | | | 3,416 | | | | 329,432 | |
| | |
Obic Co. Ltd. | | | 3,400 | | | | 499,409 | |
| | |
Otsuka Corp. | | | 400 | | | | 15,908 | |
| | |
SCSK Corp. | | | 30,800 | | | | 522,367 | |
| | | | | | | 1,367,116 | |
|
Machinery – 0.9% | |
| | |
Hoshizaki Corp. | | | 4,000 | | | | 128,046 | |
| | |
Kone OYJ, Class B | | | 10,976 | | | | 474,391 | |
| | | | | | | 602,437 | |
|
Marine Transportation – 0.5% | |
| | |
Kuehne + Nagel International AG (Registered) | | | 1,232 | | | | 330,997 | |
|
Metals & Mining – 0.7% | |
| | |
BHP Group Ltd. | | | 2,072 | | | | 58,379 | |
| | |
Franco-Nevada Corp. | | | 3,228 | | | | 392,266 | |
| | | | | | | 450,645 | |
|
Multi-Utilities – 1.1% | |
| | |
Canadian Utilities Ltd., Class A(a) | | | 18,704 | | | | 395,300 | |
| | |
National Grid plc | | | 29,176 | | | | 346,460 | |
| | | | | | | 741,760 | |
|
Office REITs – 0.0%(c) | |
| | |
Keppel REIT, REIT | | | 6,160 | | | | 3,575 | |
|
Oil, Gas & Consumable Fuels – 3.5% | |
| | |
ENEOS Holdings, Inc. | | | 75,600 | | | | 278,399 | |
| | |
Galp Energia SGPS SA | | | 22,624 | | | | 339,812 | |
| | |
Idemitsu Kosan Co. Ltd. | | | 11,200 | | | | 252,849 | |
| | |
Pembina Pipeline Corp. | | | 4,368 | | | | 134,288 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Shell plc | | | 30,940 | | | $ | 993,606 | |
| | |
TotalEnergies SE | | | 4,480 | | | | 299,275 | |
| | | | | | | 2,298,229 | |
|
Passenger Airlines – 0.8% | |
| | |
Cathay Pacific Airways Ltd.* | | | 504,000 | | | | 506,280 | |
|
Personal Care Products – 2.7% | |
| | |
Beiersdorf AG | | | 952 | | | | 124,827 | |
| | |
Unilever plc | | | 35,336 | | | | 1,667,544 | |
| | | | | | | 1,792,371 | |
|
Pharmaceuticals – 11.0% | |
| | |
AstraZeneca plc | | | 2,828 | | | | 351,743 | |
| | |
GSK plc | | | 44,296 | | | | 783,367 | |
| | |
Novartis AG (Registered) | | | 7,056 | | | | 655,474 | |
| | |
Novo Nordisk A/S, Class B | | | 10,528 | | | | 1,009,362 | |
| | |
Otsuka Holdings Co. Ltd. | | | 2,800 | | | | 93,367 | |
| | |
Roche Holding AG | | | 84 | | | | 22,817 | |
| | |
Roche Holding AG – BR | | | 9,436 | | | | 2,424,712 | |
| | |
Sanofi SA | | | 19,124 | | | | 1,732,346 | |
| | |
UCB SA | | | 3,304 | | | | 241,180 | |
| | | | | | | 7,314,368 | |
|
Professional Services – 2.6% | |
| | |
RELX plc | | | 6,608 | | | | 229,970 | |
| | |
SGS SA (Registered) | | | 5,908 | | | | 480,274 | |
| | |
Thomson Reuters Corp. | | | 2,632 | | | | 314,930 | |
| | |
Wolters Kluwer NV | | | 5,544 | | | | 709,647 | |
| | | | | | | 1,734,821 | |
|
Real Estate Management & Development – 1.6% | |
| | |
CK Asset Holdings Ltd. | | | 102,000 | | | | 509,700 | |
| | |
Sino Land Co. Ltd. | | | 11,163 | | | | 11,142 | |
| | |
Sun Hung Kai Properties Ltd. | | | 52,000 | | | | 533,983 | |
| | | | | | | 1,054,825 | |
|
Retail REITs – 0.6% | |
| | |
Link REIT, REIT | | | 81,200 | | | | 372,553 | |
|
Semiconductors & Semiconductor Equipment – 0.8% | |
| | |
ASML Holding NV | | | 868 | | | | 518,649 | |
|
Software – 1.7% | |
| | |
Constellation Software, Inc.(a) | | | 28 | | | | 56,071 | |
| | |
Oracle Corp. Japan | | | 7,600 | | | | 535,455 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 133 | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – (continued) | |
| | |
SAP SE | | | 4,004 | | | $ | 536,393 | |
| | | | | | | 1,127,919 | |
|
Specialty Retail – 1.0% | |
| | |
Industria de Diseno Textil SA(a) | | | 18,844 | | | | 648,334 | |
|
Technology Hardware, Storage & Peripherals – 0.6% | |
| | |
Canon, Inc. | | | 16,800 | | | | 393,917 | |
|
Textiles, Apparel & Luxury Goods – 0.6% | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 560 | | | | 399,250 | |
|
Tobacco – 0.4% | |
| | |
Japan Tobacco, Inc. | | | 10,200 | | | | 237,144 | |
|
Trading Companies & Distributors – 2.2% | |
| | |
Bunzl plc | | | 7,392 | | | | 262,995 | |
| | |
Ferguson plc | | | 3,528 | | | | 527,854 | |
| | |
ITOCHU Corp. | | | 19,600 | | | | 695,373 | |
| | | | | | | 1,486,222 | |
|
Transportation Infrastructure – 0.8% | |
| | |
Aena SME SA(b) | | | 1,988 | | | | 287,355 | |
| | |
Auckland International Airport Ltd. | | | 1,098 | | | | 4,688 | |
| | |
Flughafen Zurich AG (Registered) | | | 1,372 | | | | 255,087 | |
| | |
Getlink SE | | | 28 | | | | 451 | |
| | | | | | | 547,581 | |
|
Wireless Telecommunication Services – 2.7% | |
| | |
KDDI Corp. | | | 25,200 | | | | 746,623 | |
| | |
Rogers Communications, Inc., Class B | | | 4,844 | | | | 179,279 | |
| | |
SoftBank Corp. | | | 47,600 | | | | 535,891 | |
| | |
Vodafone Group plc | | | 362,516 | | | | 333,001 | |
| | | | | | | 1,794,794 | |
Total Common Stocks (Cost $65,665,911) | | | | 64,658,984 | |
| | | | | | | | |
Investments | | Number of Warrants | | | Value | |
|
WARRANTS – 0.0% | |
|
Software – 0.0% | |
| | |
Constellation Software, Inc., expiring 3/31/2040, price 11.50 CAD* ‡ (Cost $–) | | | 28 | | | $ | — | |
Total Investments – 97.6% (Cost $65,665,911) | | | | 64,658,984 | |
| |
Other assets less liabilities – 2.4% | | | | 1,604,367 | |
NET ASSETS – 100.0% | | | $ | 66,263,351 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $2,212,131, collateralized by $1,823,311 in U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.13%, and maturity dates ranging from November 16, 2023 – August 15, 2053 and $627,612 in Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $2,450,923. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
Abbreviations
OYJ – Public Limited Company
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 4,588,367 | |
Aggregate gross unrealized depreciation | | | (5,879,577 | ) |
Net unrealized depreciation | | $ | (1,291,210 | ) |
Federal income tax cost | | $ | 65,879,973 | |
See Accompanying Notes to the Financial Statements.
| | | | |
134 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (cont.)
Futures Contracts
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
MSCI EAFE E-Mini Index | | | 13 | | | | 12/15/2023 | | | | USD | | | $ | 1,283,165 | | | $ | (79,276 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | | | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 77,079 | | | | | Toronto-Dominion Bank (The) | | AUD | | | 119,288 | | | | 12/20/2023 | | | $ | 1,427 | |
USD | | | 189,827 | | | | | Toronto-Dominion Bank (The) | | CHF | | | 167,993 | | | | 12/20/2023 | | | | 4,186 | |
USD | | | 43,617 | | | | | JPMorgan Chase Bank NA | | DKK | | | 303,190 | | | | 12/20/2023 | | | | 562 | |
USD | | | 301,456 | | | | | Morgan Stanley | | EUR | | | 281,420 | | | | 12/20/2023 | | | | 3,310 | |
USD | | | 24,818 | | | | | Citibank NA | | GBP | | | 19,939 | | | | 12/20/2023 | | | | 614 | |
USD | | | 540,444 | | | | | JPMorgan Chase Bank NA | | JPY | | | 78,676,131 | | | | 12/20/2023 | | | | 16,570 | |
USD | | | 12,263 | | | | | Citibank NA | | NOK | | | 131,563 | | | | 12/20/2023 | | | | 469 | |
USD | | | 24,409 | | | | | Morgan Stanley | | NZD | | | 41,229 | | | | 12/20/2023 | | | | 424 | |
USD | | | 69,008 | | | | | Goldman Sachs & Co. | | SEK | | | 767,599 | | | | 12/20/2023 | | | | 137 | |
Total unrealized appreciation | | | | | | | $ | 27,699 | |
CAD | | | 91,112 | | | | | Citibank NA | | USD | | | 67,349 | | | | 12/20/2023 | | | $ | (1,661 | ) |
EUR | | | 63,000 | | | | | Toronto-Dominion Bank (The) | | USD | | | 67,466 | | | | 12/20/2023 | | | | (722 | ) |
HKD | | | 282,833 | | | | | Toronto-Dominion Bank (The) | | USD | | | 36,198 | | | | 12/20/2023 | | | | (22 | ) |
ILS | | | 73,522 | | | | | Citibank NA | | USD | | | 19,320 | | | | 12/20/2023 | | | | (1,096 | ) |
JPY | | | 71,113,000 | | | | | JPMorgan Chase Bank NA | | USD | | | 488,314 | | | | 12/20/2023 | | | | (14,800 | ) |
SGD | | | 16,357 | | | | | BNP Paribas SA | | USD | | | 12,078 | | | | 12/20/2023 | | | | (113 | ) |
USD | | | 64,395 | | | | | Toronto-Dominion Bank (The) | | EUR | | | 61,000 | | | | 12/20/2023 | | | | (230 | ) |
Total unrealized depreciation | | | | | | | $ | (18,644 | ) |
Net unrealized appreciation | | | | | | | $ | 9,055 | |
Abbreviations:
AUD – Australian Dollar
CAD – Canadian Dollar
CHF – Swiss Franc
DKK – Danish Krone
EUR – Euro
GBP – British Pound
HKD – Hong Kong Dollar
ILS – Israeli Shekel
JPY– Japanese Yen
NOK – Norwegian Krone
NZD – New Zealand Dollar
SEK – Swedish Krona
SGD – Singapore Dollar
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 135 | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (cont.)
FlexShares® Developed Markets ex-US Quality Low Volatility Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 2.4 | % |
Belgium | | | 0.4 | |
Canada | | | 10.1 | |
Denmark | | | 1.7 | |
Finland | | | 2.2 | |
France | | | 7.6 | |
Germany | | | 3.7 | |
Hong Kong | | | 5.9 | |
Israel | | | 2.7 | |
Italy | | | 0.3 | |
Japan | | | 23.2 | |
Netherlands | | | 4.8 | |
New Zealand | | | 0.0 | † |
Portugal | | | 1.0 | |
Singapore | | | 5.1 | |
Spain | | | 3.4 | |
Switzerland | | | 12.7 | |
United Kingdom | | | 10.4 | |
Other1 | | | 2.4 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 97.6 | % |
Warrants | | | — | |
Others(1) | | | 2.4 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
136 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Emerging Markets Quality Low Volatility Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.1% | |
|
Automobile Components – 1.1% | |
| | |
Cheng Shin Rubber Industry Co. Ltd. | | | 48,000 | | | $ | 65,337 | |
| | |
Hyundai Mobis Co. Ltd. | | | 24 | | | | 3,705 | |
| | |
MRF Ltd. | | | 54 | | | | 70,240 | |
| | | | | | | 139,282 | |
|
Automobiles – 2.4% | |
| | |
Bajaj Auto Ltd. | | | 1,938 | | | | 123,694 | |
| | |
Hero MotoCorp Ltd. | | | 2,064 | | | | 76,561 | |
| | |
Maruti Suzuki India Ltd. | | | 864 | | | | 107,844 | |
| | | | | | | 308,099 | |
|
Banks – 18.3% | |
| | |
Abu Dhabi Islamic Bank PJSC | | | 22,170 | | | | 62,170 | |
| | |
Agricultural Bank of China Ltd., Class H | | | 372,000 | | | | 137,397 | |
| | |
Al Rajhi Bank | | | 2,106 | | | | 37,667 | |
| | |
Axis Bank Ltd. | | | 738 | | | | 8,703 | |
| | |
Banco BBVA Peru SA | | | 5,514 | | | | 2,013 | |
| | |
Bank Central Asia Tbk. PT | | | 117,600 | | | | 64,778 | |
| | |
Bank of China Ltd., Class H | | | 408,000 | | | | 142,872 | |
| | |
Bank of Communications Co. Ltd., Class H | | | 138,000 | | | | 81,658 | |
| | |
Boubyan Bank KSCP | | | 36,360 | | | | 68,832 | |
| | |
Chang Hwa Commercial Bank Ltd. | | | 126,000 | | | | 66,623 | |
| | |
China CITIC Bank Corp. Ltd., Class H | | | 174,000 | | | | 77,609 | |
| | |
China Construction Bank Corp., Class H | | | 443,000 | | | | 251,376 | |
| | |
China Zheshang Bank Co. Ltd., Class H | | | 234,000 | | | | 58,017 | |
| | |
Dubai Islamic Bank PJSC | | | 71,100 | | | | 104,530 | |
| | |
Emirates NBD Bank PJSC | | | 18,090 | | | | 83,481 | |
| | |
First Financial Holding Co. Ltd. | | | 120,000 | | | | 95,822 | |
| | |
Grupo Financiero Banorte SAB de CV, Class O | | | 600 | | | | 4,863 | |
| | |
HDFC Bank Ltd. | | | 528 | | | | 9,364 | |
| | |
Hong Leong Bank Bhd. | | | 16,800 | | | | 68,406 | |
| | |
Hong Leong Financial Group Bhd. | | | 15,000 | | | | 55,284 | |
| | |
ICICI Bank Ltd. | | | 7,194 | | | | 79,091 | |
| | |
Industrial & Commercial Bank of China Ltd., Class H | | | 570,000 | | | | 273,905 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Itau Unibanco Holding SA (Preference) | | | 3,000 | | | $ | 15,955 | |
| | |
Kuwait Finance House KSCP | | | 43,728 | | | | 96,624 | |
| | |
Malayan Banking Bhd. | | | 44,400 | | | | 84,057 | |
| | |
National Bank of Kuwait SAKP | | | 39,480 | | | | 111,853 | |
| | |
Qatar International Islamic Bank QSC | | | 26,130 | | | | 66,384 | |
| | |
Qatar National Bank QPSC | | | 24,612 | | | | 100,652 | |
| | |
Saudi Investment Bank (The) | | | 15,870 | | | | 62,184 | |
| | |
Sberbank of Russia PJSC‡ | | | 12,360 | | | | — | |
| | | | | | | 2,372,170 | |
|
Beverages – 0.7% | |
| | |
Emperador, Inc. | | | 181,200 | | | | 66,425 | |
| | |
Nongfu Spring Co. Ltd., Class H(a) | | | 4,800 | | | | 27,329 | |
| | | | | | | 93,754 | |
|
Broadline Retail – 3.7% | |
| | |
Alibaba Group Holding Ltd., ADR* | | | 4,950 | | | | 408,573 | |
| | |
PDD Holdings, Inc., ADR* | | | 576 | | | | 58,418 | |
| | |
Prosus NV* | | | 170 | | | | 4,749 | |
| | |
Robinson PCL* ‡ | | | 600 | | | | — | |
| | |
Vipshop Holdings Ltd., ADR* | | | 222 | | | | 3,166 | |
| | | | | | | 474,906 | |
|
Capital Markets – 0.8% | |
| | |
Macquarie Korea Infrastructure Fund | | | 12,084 | | | | 107,549 | |
|
Chemicals – 3.8% | |
| | |
Asian Paints Ltd. | | | 2,952 | | | | 106,215 | |
| | |
Berger Paints India Ltd. | | | 2,181 | | | | 14,633 | |
| | |
Fertiglobe plc | | | 105,726 | | | | 92,399 | |
| | |
Mesaieed Petrochemical Holding Co. | | | 137,448 | | | | 60,022 | |
| | |
PhosAgro PJSC‡ | | | 1,158 | | | | — | |
| | |
Pidilite Industries Ltd. | | | 2,538 | | | | 74,928 | |
| | |
SABIC Agri-Nutrients Co. | | | 3,192 | | | | 113,842 | |
| | |
Saudi Basic Industries Corp. | | | 1,740 | | | | 35,713 | |
| | | | | | | 497,752 | |
|
Construction & Engineering – 0.4% | |
| | |
China Railway Group Ltd., Class H | | | 102,000 | | | | 48,102 | |
| | |
Larsen & Toubro Ltd. | | | 156 | | | | 5,488 | |
| | | | | | | 53,590 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 137 | |
FlexShares® Emerging Markets Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Construction Materials – 0.8% | |
| | |
Asia Cement Corp. | | | 32,000 | | | $ | 39,464 | |
| | |
LafargeHolcim Maroc SA | | | 396 | | | | 71,723 | |
| | | | | | | 111,187 | |
|
Consumer Finance – 0.6% | |
| | |
Bajaj Finance Ltd. | | | 78 | | | | 7,019 | |
| | |
Samsung Card Co. Ltd. | | | 3,030 | | | | 70,335 | |
| | | | | | | 77,354 | |
|
Consumer Staples Distribution & Retail – 0.8% | |
| | |
Nahdi Medical Co. | | | 162 | | | | 6,123 | |
| | |
President Chain Store Corp. | | | 12,000 | | | | 95,268 | |
| | |
Wal-Mart de Mexico SAB de CV | | | 1,200 | | | | 4,289 | |
| | | | | | | 105,680 | |
|
Diversified Telecommunication Services – 4.3% | |
| | |
Chunghwa Telecom Co. Ltd. | | | 39,000 | | | | 139,479 | |
| | |
Emirates Integrated Telecommunications Co. PJSC | | | 46,146 | | | | 67,592 | |
| | |
Itissalat Al-Maghrib | | | 8,532 | | | | 79,501 | |
| | |
LG Uplus Corp. | | | 7,902 | | | | 59,153 | |
| | |
Ooredoo QPSC | | | 6,852 | | | | 18,612 | |
| | |
Saudi Telecom Co. | | | 8,334 | | | | 85,304 | |
| | |
Telkom Indonesia Persero Tbk. PT | | | 511,200 | | | | 112,313 | |
| | | | | | | 561,954 | |
|
Electric Utilities – 3.7% | |
| | |
CPFL Energia SA | | | 15,000 | | | | 99,465 | |
| | |
CTEEP-Cia de Transmissao de Energia Eletrica Paulista (Preference) | | | 4,800 | | | | 20,169 | |
| | |
Manila Electric Co. | | | 11,340 | | | | 70,950 | |
| | |
Power Grid Corp. of India Ltd. | | | 54,280 | | | | 131,790 | |
| | |
Saudi Electricity Co. | | | 13,404 | | | | 63,597 | |
| | |
Transmissora Alianca de Energia Eletrica SA | | | 14,400 | | | | 96,485 | |
| | | | | | | 482,456 | |
|
Electrical Equipment – 0.8% | |
| | |
ABB India Ltd. | | | 2,028 | | | | 100,094 | |
|
Electronic Equipment, Instruments & Components – 0.7% | |
| | |
MOG Digitech Holdings Ltd.* | | | 6,000 | | | | 1,687 | |
| | |
WPG Holdings Ltd. | | | 42,000 | | | | 92,715 | |
| | | | | | | 94,402 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Entertainment – 0.8% | |
| | |
NetEase, Inc., ADR | | | 1,020 | | | $ | 109,058 | |
|
Food Products – 4.4% | |
| | |
Almarai Co. JSC | | | 4,266 | | | | 63,565 | |
| | |
Nestle India Ltd. | | | 114 | | | | 33,183 | |
| | |
Nestle Malaysia Bhd. | | | 3,600 | | | | 93,542 | |
| | |
Orion Corp. | | | 600 | | | | 53,223 | |
| | |
Tingyi Cayman Islands Holding Corp. | | | 74,000 | | | | 98,167 | |
| | |
Uni-President China Holdings Ltd. | | | 60,000 | | | | 40,871 | |
| | |
Uni-President Enterprises Corp. | | | 42,000 | | | | 87,924 | |
| | |
Want Want China Holdings Ltd. | | | 156,000 | | | | 96,894 | |
| | | | | | | 567,369 | |
|
Gas Utilities – 0.8% | |
| | |
Petronas Gas Bhd. | | | 28,200 | | | | 101,803 | |
|
Health Care Providers & Services – 3.6% | |
| | |
Bangkok Dusit Medical Services PCL, NVDR | | | 102,000 | | | | 75,203 | |
| | |
Bumrungrad Hospital PCL, NVDR | | | 15,000 | | | | 108,507 | |
| | |
Dr Sulaiman Al Habib Medical Services Group Co. | | | 1,134 | | | | 76,172 | |
| | |
Mitra Keluarga Karyasehat Tbk. PT(b) | | | 523,200 | | | | 90,247 | |
| | |
Mouwasat Medical Services Co. | | | 2,328 | | | | 62,053 | |
| | |
Sinopharm Group Co. Ltd., Class H | | | 24,000 | | | | 57,358 | |
| | | | | | | 469,540 | |
|
Hotels, Restaurants & Leisure – 0.8% | |
| | |
Kangwon Land, Inc. | | | 2,490 | | | | 27,047 | |
| | |
Meituan, Class B* (b) | | | 4,200 | | | | 59,366 | |
| | |
Yum China Holdings, Inc. | | | 228 | | | | 11,984 | |
| | | | | | | 98,397 | |
|
Household Products – 0.6% | |
| | |
Unilever Indonesia Tbk. PT | | | 346,200 | | | | 78,895 | |
|
Independent Power and Renewable Electricity Producers – 0.8% | |
| | |
ACWA Power Co. | | | 648 | | | | 39,209 | |
| | |
Engie Brasil Energia SA | | | 1,800 | | | | 14,027 | |
| | |
NTPC Ltd. | | | 18,318 | | | | 51,879 | |
| | |
Unipro PJSC* ‡ | | | 726,000 | | | | — | |
| | | | | | | 105,115 | |
See Accompanying Notes to the Financial Statements.
| | | | |
138 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Emerging Markets Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – 2.1% | |
| | |
Alpha Dhabi Holding PJSC* | | | 14,796 | | | $ | 76,054 | |
| | |
Far Eastern New Century Corp. | | | 72,000 | | | | 65,485 | |
| | |
Samsung C&T Corp. | | | 780 | | | | 61,624 | |
| | |
Sime Darby Bhd. | | | 139,200 | | | | 66,905 | |
| | | | | | | 270,068 | |
|
Insurance – 2.2% | |
| | |
Bupa Arabia for Cooperative Insurance Co. | | | 1,356 | | | | 76,988 | |
| | |
DB Insurance Co. Ltd. | | | 246 | | | | 16,011 | |
| | |
PICC Property & Casualty Co. Ltd., Class H | | | 72,000 | | | | 82,264 | |
| | |
Ping An Insurance Group Co. of China Ltd., Class H | | | 6,000 | | | | 30,749 | |
| | |
Samsung Fire & Marine Insurance Co. Ltd. | | | 420 | | | | 80,389 | |
| | | | | | | 286,401 | |
|
Interactive Media & Services – 3.4% | |
| | |
Tencent Holdings Ltd. | | | 11,800 | | | | 436,132 | |
|
IT Services – 4.4% | |
| | |
Arabian Internet & Communications Services Co. | | | 798 | | | | 66,535 | |
| | |
HCL Technologies Ltd. | | | 2,184 | | | | 33,471 | |
| | |
Infosys Ltd. | | | 4,644 | | | | 76,327 | |
| | |
Samsung SDS Co. Ltd. | | | 726 | | | | 74,291 | |
| | |
Tata Consultancy Services Ltd. | | | 7,806 | | | | 315,840 | |
| | | | | | | 566,464 | |
|
Life Sciences Tools & Services – 0.1% | |
| | |
Divi’s Laboratories Ltd. | | | 72 | | | | 2,930 | |
| | |
Samsung Biologics Co. Ltd.* (b) | | | 24 | | | | 12,599 | |
| | | | | | | 15,529 | |
|
Marine Transportation – 0.5% | |
| | |
MISC Bhd. | | | 45,600 | | | | 69,388 | |
|
Metals & Mining – 0.5% | |
| | |
China Steel Corp. | | | 12,000 | | | | 8,935 | |
| | |
Industrias CH SAB de CV, Class B, Series B* | | | 350 | | | | 3,742 | |
| | |
Polyus PJSC* ‡ | | | 546 | | | | — | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Vale SA | | | 3,600 | | | $ | 49,256 | |
| | | | | | | 61,933 | |
|
Multi-Utilities – 0.6% | |
| | |
Dubai Electricity & Water Authority PJSC | | | 113,886 | | | | 73,795 | |
|
Office REITs – 0.2% | |
| | |
Embassy Office Parks REIT, REIT | | | 6,396 | | | | 23,942 | |
|
Oil, Gas & Consumable Fuels – 3.2% | |
| | |
China Shenhua Energy Co. Ltd., Class H | | | 6,000 | | | | 18,404 | |
| | |
PetroChina Co. Ltd., Class H | | | 36,000 | | | | 23,464 | |
| | |
Petroleo Brasileiro SA | | | 1,800 | | | | 13,506 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 3,600 | | | | 24,800 | |
| | |
Petronas Dagangan Bhd. | | | 13,800 | | | | 66,212 | |
| | |
Petronet LNG Ltd. | | | 1,554 | | | | 3,726 | |
| | |
Qatar Fuel QSC | | | 23,838 | | | | 97,224 | |
| | |
Qatar Gas Transport Co. Ltd. | | | 68,034 | | | | 65,773 | |
| | |
Reliance Industries Ltd. | | | 2,964 | | | | 81,449 | |
| | |
Surgutneftegas PJSC (Preference)‡ | | | 156,600 | | | | — | |
| | |
United Tractors Tbk. PT | | | 13,800 | | | | 21,827 | |
| | | | | | | 416,385 | |
|
Personal Care Products – 2.2% | |
| | |
Colgate-Palmolive India Ltd. | | | 348 | | | | 8,835 | |
| | |
Hengan International Group Co. Ltd. | | | 28,500 | | | | 95,430 | |
| | |
Hindustan Unilever Ltd. | | | 6,318 | | | | 188,496 | |
| | | | | | | 292,761 | |
|
Pharmaceuticals – 3.4% | |
| | |
Alkem Laboratories Ltd. | | | 414 | | | | 18,507 | |
| | |
Cipla Ltd. | | | 7,806 | | | | 112,507 | |
| | |
Dr Reddy’s Laboratories Ltd. | | | 1,638 | | | | 105,599 | |
| | |
Kalbe Farma Tbk. PT | | | 508,800 | | | | 54,131 | |
| | |
Sun Pharmaceutical Industries Ltd. | | | 6,786 | | | | 88,726 | |
| | |
Torrent Pharmaceuticals Ltd. | | | 192 | | | | 4,437 | |
| | |
Yuhan Corp. | | | 1,332 | | | | 56,612 | |
| | | | | | | 440,519 | |
|
Real Estate Management & Development – 0.3% | |
| | |
Aldar Properties PJSC | | | 26,538 | | | | 37,571 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 139 | |
FlexShares® Emerging Markets Quality Low Volatility Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – 6.3% | |
| | |
MediaTek, Inc. | | | 1,200 | | | $ | 31,152 | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 48,000 | | | | 782,857 | |
| | | | | | | 814,009 | |
|
Specialty Retail – 2.1% | |
| | |
Abu Dhabi National Oil Co. for Distribution PJSC | | | 68,688 | | | | 62,835 | |
| | |
Home Product Center PCL, NVDR | | | 181,200 | | | | 59,993 | |
| | |
Jarir Marketing Co. | | | 26,376 | | | | 101,803 | |
| | |
MR DIY Group M Bhd.(b) | | | 148,200 | | | | 46,035 | |
| | | | | | | 270,666 | |
|
Technology Hardware, Storage & Peripherals – 4.2% | |
| | |
Compal Electronics, Inc. | | | 102,000 | | | | 88,210 | |
| | |
Pegatron Corp. | | | 25,000 | | | | 58,116 | |
| | |
Samsung Electronics Co. Ltd. | | | 7,938 | | | | 393,212 | |
| | | | | | | 539,538 | |
|
Textiles, Apparel & Luxury Goods – 0.7% | |
| | |
Titan Co. Ltd. | | | 2,520 | | | | 96,541 | |
|
Tobacco – 0.6% | |
| | |
KT&G Corp. | | | 1,236 | | | | 78,065 | |
|
Transportation Infrastructure – 2.0% | |
| | |
Airports of Thailand PCL, NVDR* | | | 42,000 | | | | 77,999 | |
| | |
Salik Co. PJSC | | | 112,398 | | | | 97,618 | |
| | |
Taiwan High Speed Rail Corp. | | | 93,000 | | | | 84,298 | |
| | | | | | | 259,915 | |
|
Water Utilities – 0.7% | |
| | |
Emirates Central Cooling Systems Corp. | | | 200,406 | | | | 97,666 | |
|
Wireless Telecommunication Services – 4.7% | |
| | |
Advanced Info Service PCL, NVDR | | | 18,000 | | | | 110,176 | |
| | |
America Movil SAB de CV, Series B | | | 35,400 | | | | 29,198 | |
| | |
Etihad Etisalat Co. | | | 8,010 | | | | 98,427 | |
| | |
Far EasTone Telecommunications Co. Ltd. | | | 43,000 | | | | 100,623 | |
| | |
Intouch Holdings PCL, NVDR | | | 48,000 | | | | 94,818 | |
| | |
Mobile Telecommunications Co. KSCP | | | 43,584 | | | | 67,724 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Taiwan Mobile Co. Ltd. | | | 37,000 | | | $ | 109,283 | |
| | | | | | | 610,249 | |
Total Common Stocks (Cost $13,811,847) | | | | 12,867,943 | |
| | | | | | | | |
Total Investments – 99.1% (Cost $13,811,847) | | | | 12,867,943 | |
| |
Other assets less liabilities – 0.9% | | | | 111,903 | |
NET ASSETS – 100.0% | | | $ | 12,979,846 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
NVDR – Non-Voting Depositary Receipt
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 727,786 | |
Aggregate gross unrealized depreciation | | | (1,776,759 | ) |
Net unrealized depreciation | | $ | (1,048,973 | ) |
Federal income tax cost | | $ | 13,904,379 | |
See Accompanying Notes to the Financial Statements.
| | | | |
140 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Emerging Markets Quality Low Volatility Index Fund (cont.)
Futures Contracts
FlexShares® Emerging Markets Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | |
MSCI Emerging Markets E-Mini Index | | | 4 | | | | 12/15/2023 | | | | USD | | | $ | 183,840 | | | $ | (12,537 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
FlexShares® Emerging Markets Quality Low Volatility Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Brazil | | | 2.6 | % |
China | | | 21.0 | |
India | | | 16.7 | |
Indonesia | | | 3.2 | |
Kuwait | | | 2.7 | |
Malaysia | | | 5.0 | |
Mexico | | | 0.3 | |
Morocco | | | 1.2 | |
Peru | | | 0.0 | † |
Philippines | | | 1.1 | |
Qatar | | | 3.1 | |
Saudi Arabia | | | 7.6 | |
South Africa | | | 0.0 | † |
South Korea | | | 8.4 | |
Taiwan | | | 15.5 | |
Thailand | | | 4.1 | |
United Arab Emirates | | | 6.6 | |
Other1 | | | 0.9 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.1 | % |
Others(1) | | | 0.9 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 141 | |
Schedule of Investments
FlexShares® Morningstar US Market Factor Tilt Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.1% | |
|
Aerospace & Defense – 1.4% | |
| | |
AAR Corp.* | | | 2,565 | | | $ | 152,259 | |
| | |
AeroVironment, Inc.* (a) | | | 1,197 | | | | 137,248 | |
| | |
Axon Enterprise, Inc.* (a) | | | 1,539 | | | | 314,710 | |
| | |
Boeing Co. (The)* | | | 16,830 | | | | 3,144,181 | |
| | |
BWX Technologies, Inc.(a) | | | 3,933 | | | | 292,143 | |
| | |
Curtiss-Wright Corp. | | | 2,210 | | | | 439,370 | |
| | |
Ducommun, Inc.* | | | 513 | | | | 24,542 | |
| | |
General Dynamics Corp. | | | 6,669 | | | | 1,609,296 | |
| | |
HEICO Corp.(a) | | | 1,360 | | | | 215,438 | |
| | |
HEICO Corp., Class A | | | 1,710 | | | | 217,392 | |
| | |
Hexcel Corp. | | | 3,060 | | | | 189,475 | |
| | |
Howmet Aerospace, Inc. | | | 10,880 | | | | 479,808 | |
| | |
Huntington Ingalls Industries, Inc. | | | 1,197 | | | | 263,125 | |
| | |
Kratos Defense & Security Solutions, Inc.* | | | 3,933 | | | | 67,058 | |
| | |
L3Harris Technologies, Inc. | | | 4,930 | | | | 884,491 | |
| | |
Lockheed Martin Corp. | | | 6,630 | | | | 3,014,263 | |
| | |
Mercury Systems, Inc.* (a) | | | 1,020 | | | | 36,700 | |
| | |
Moog, Inc., Class A | | | 2,040 | | | | 236,742 | |
| | |
Northrop Grumman Corp. | | | 3,570 | | | | 1,683,005 | |
| | |
Parsons Corp.* | | | 3,238 | | | | 183,109 | |
| | |
Rocket Lab USA, Inc.* (a) | | | 22,610 | | | | 95,640 | |
| | |
RTX Corp. | | | 37,060 | | | | 3,016,313 | |
| | |
Spirit AeroSystems Holdings, Inc., Class A* (a) | | | 4,104 | | | | 92,750 | |
| | |
Textron, Inc. | | | 6,120 | | | | 465,120 | |
| | |
TransDigm Group, Inc.* | | | 1,360 | | | | 1,126,202 | |
| | |
Triumph Group, Inc.* | | | 6,498 | | | | 48,475 | |
| | |
V2X, Inc.* (a) | | | 850 | | | | 43,410 | |
| | |
Woodward, Inc.(a) | | | 3,078 | | | | 383,827 | |
| | | | | | | 18,856,092 | |
|
Air Freight & Logistics – 0.5% | |
| | |
Air Transport Services Group, Inc.* (a) | | | 13,600 | | | | 266,152 | |
| | |
CH Robinson Worldwide, Inc.(a) | | | 3,591 | | | | 293,852 | |
| | |
Expeditors International of Washington, Inc.(a) | | | 4,250 | | | | 464,312 | |
| | |
FedEx Corp. | | | 7,310 | | | | 1,755,131 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Air Freight & Logistics – (continued) | |
| | |
Forward Air Corp. | | | 855 | | | $ | 55,071 | |
| | |
GXO Logistics, Inc.* (a) | | | 6,800 | | | | 343,468 | |
| | |
Hub Group, Inc., Class A* (a) | | | 7,820 | | | | 537,625 | |
| | |
United Parcel Service, Inc., Class B | | | 21,590 | | | | 3,049,587 | |
| | | | | | | 6,765,198 | |
|
Automobile Components – 0.5% | |
| | |
Adient plc* (a) | | | 21,930 | | | | 738,822 | |
| | |
American Axle & Manufacturing Holdings, Inc.* (a) | | | 13,430 | | | | 90,652 | |
| | |
Aptiv plc* | | | 7,011 | | | | 611,359 | |
| | |
Autoliv, Inc.(a) | | | 3,570 | | | | 327,190 | |
| | |
BorgWarner, Inc. | | | 7,990 | | | | 294,831 | |
| | |
Dana, Inc. | | | 6,120 | | | | 70,257 | |
| | |
Dorman Products, Inc.* (a) | | | 850 | | | | 52,853 | |
| | |
Fox Factory Holding Corp.* (a) | | | 1,870 | | | | 152,349 | |
| | |
Garrett Motion, Inc.* (a) | | | 23,290 | | | | 164,427 | |
| | |
Gentex Corp. | | | 11,050 | | | | 316,914 | |
| | |
Gentherm, Inc.* (a) | | | 1,026 | | | | 41,266 | |
| | |
Goodyear Tire & Rubber Co. (The)* | | | 57,782 | | | | 687,606 | |
| | |
LCI Industries(a) | | | 5,130 | | | | 556,554 | |
| | |
Lear Corp. | | | 2,380 | | | | 308,829 | |
| | |
Mobileye Global, Inc., Class A* (a) | | | 4,080 | | | | 145,534 | |
| | |
Modine Manufacturing Co.* | | | 9,520 | | | | 376,040 | |
| | |
Patrick Industries, Inc.(a) | | | 5,440 | | | | 408,816 | |
| | |
QuantumScape Corp., Class A* (a) | | | 72,250 | | | | 377,145 | |
| | |
Standard Motor Products, Inc. | | | 4,420 | | | | 154,391 | |
| | |
Stoneridge, Inc.* | | | 6,669 | | | | 108,505 | |
| | |
Visteon Corp.* | | | 1,700 | | | | 195,721 | |
| | |
XPEL, Inc.* (b) | | | 1,197 | | | | 55,421 | |
| | | | | | | 6,235,482 | |
|
Automobiles – 1.4% | |
| | |
Fisker, Inc., Class A* (a) | | | 15,810 | | | | 71,145 | |
| | |
Ford Motor Co. | | | 120,336 | | | | 1,173,276 | |
| | |
General Motors Co. | | | 39,610 | | | | 1,117,002 | |
See Accompanying Notes to the Financial Statements.
| | | | |
142 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Automobiles – (continued) | |
| | |
Harley-Davidson, Inc. | | | 28,560 | | | $ | 766,836 | |
| | |
Lucid Group, Inc.* (a) | | | 31,620 | | | | 130,274 | |
| | |
Rivian Automotive, Inc., Class A* (a) | | | 22,780 | | | | 369,492 | |
| | |
Tesla, Inc.* | | | 68,170 | | | | 13,691,263 | |
| | |
Thor Industries, Inc.(a) | | | 11,050 | | | | 971,626 | |
| | |
Winnebago Industries, Inc.(a) | | | 5,440 | | | | 315,248 | |
| | | | | | | 18,606,162 | |
|
Banks – 5.6% | |
| | |
1st Source Corp. | | | 2,210 | | | | 100,820 | |
| | |
Amalgamated Financial Corp.(a) | | | 6,120 | | | | 111,629 | |
| | |
Amerant Bancorp, Inc., Class A | | | 8,500 | | | | 154,955 | |
| | |
Ameris Bancorp | | | 14,790 | | | | 551,667 | |
| | |
Associated Banc-Corp. | | | 36,890 | | | | 597,987 | |
| | |
Atlantic Union Bankshares Corp.(a) | | | 16,150 | | | | 465,282 | |
| | |
Axos Financial, Inc.* (a) | | | 11,286 | | | | 406,635 | |
| | |
Banc of California, Inc. | | | 18,020 | | | | 202,004 | |
| | |
BancFirst Corp.(a) | | | 1,535 | | | | 124,504 | |
| | |
Bancorp, Inc. (The)* | | | 4,760 | | | | 169,694 | |
| | |
Bank of America Corp. | | | 206,720 | | | | 5,445,005 | |
| | |
Bank of Hawaii Corp. | | | 170 | | | | 8,396 | |
| | |
Bank OZK(a) | | | 24,650 | | | | 882,717 | |
| | |
BankUnited, Inc. | | | 19,890 | | | | 433,801 | |
| | |
Banner Corp. | | | 9,520 | | | | 401,839 | |
| | |
Berkshire Hills Bancorp, Inc. | | | 7,310 | | | | 143,349 | |
| | |
BOK Financial Corp. | | | 5,270 | | | | 345,290 | |
| | |
Brookline Bancorp, Inc. | | | 11,970 | | | | 97,436 | |
| | |
Byline Bancorp, Inc.(a) | | | 7,480 | | | | 141,896 | |
| | |
Cadence Bank(a) | | | 35,870 | | | | 759,727 | |
| | |
Camden National Corp.(a) | | | 340 | | | | 9,914 | |
| | |
Capitol Federal Financial, Inc.(a) | | | 19,890 | | | | 103,428 | |
| | |
Cathay General Bancorp(a) | | | 15,130 | | | | 513,058 | |
| | |
Central Pacific Financial Corp.(a) | | | 2,550 | | | | 40,239 | |
| | |
Citigroup, Inc. | | | 57,120 | | | | 2,255,669 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Citizens Financial Group, Inc.(a) | | | 17,170 | | | $ | 402,293 | |
| | |
City Holding Co.(a) | | | 342 | | | | 31,047 | |
| | |
Coastal Financial Corp.* | | | 3,400 | | | | 126,378 | |
| | |
Columbia Banking System, Inc. | | | 50,150 | | | | 986,451 | |
| | |
Comerica, Inc. | | | 30,770 | | | | 1,212,338 | |
| | |
Commerce Bancshares, Inc.(a) | | | 3,740 | | | | 164,036 | |
| | |
Community Bank System, Inc.(a) | | | 1,530 | | | | 61,123 | |
| | |
Community Trust Bancorp, Inc. | | | 1,881 | | | | 70,650 | |
| | |
ConnectOne Bancorp, Inc. | | | 12,750 | | | | 207,698 | |
| | |
CrossFirst Bankshares, Inc.* (a) | | | 5,780 | | | | 61,152 | |
| | |
Cullen/Frost Bankers, Inc. | | | 2,040 | | | | 185,620 | |
| | |
Customers Bancorp, Inc.* | | | 5,301 | | | | 213,153 | |
| | |
CVB Financial Corp.(a) | | | 26,520 | | | | 414,242 | |
| | |
Dime Community Bancshares, Inc.(a) | | | 11,900 | | | | 218,841 | |
| | |
Eagle Bancorp, Inc. | | | 10,370 | | | | 202,008 | |
| | |
East West Bancorp, Inc.(a) | | | 5,130 | | | | 275,071 | |
| | |
Eastern Bankshares, Inc. | | | 36,040 | | | | 396,800 | |
| | |
Enterprise Financial Services Corp. | | | 3,230 | | | | 112,307 | |
| | |
Farmers National Banc Corp.(a) | | | 9,350 | | | | 105,562 | |
| | |
FB Financial Corp. | | | 1,020 | | | | 29,957 | |
| | |
Fifth Third Bancorp | | | 22,059 | | | | 523,019 | |
| | |
First Bancorp/NC(a) | | | 3,249 | | | | 94,286 | |
| | |
First Bancorp/PR(a) | | | 43,883 | | | | 585,838 | |
| | |
First Bancshares, Inc. (The)(a) | | | 9,350 | | | | 226,457 | |
| | |
First Busey Corp.(a) | | | 15,810 | | | | 313,987 | |
| | |
First Citizens BancShares, Inc., Class A | | | 342 | | | | 472,213 | |
| | |
First Commonwealth Financial Corp.(a) | | | 23,256 | | | | 283,258 | |
| | |
First Financial Bancorp(a) | | | 17,271 | | | | 319,514 | |
| | |
First Financial Bankshares, Inc.(a) | | | 3,060 | | | | 73,593 | |
| | |
First Financial Corp. | | | 1,020 | | | | 35,098 | |
| | |
First Hawaiian, Inc.(a) | | | 32,640 | | | | 585,235 | |
| | |
First Horizon Corp. | | | 19,040 | | | | 204,680 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 143 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
First Interstate BancSystem, Inc., Class A | | | 14,620 | | | $ | 337,283 | |
| | |
First Merchants Corp. | | | 16,150 | | | | 441,056 | |
| | |
First Mid Bancshares, Inc. | | | 7,310 | | | | 199,709 | |
| | |
FNB Corp.(a) | | | 71,570 | | | | 765,083 | |
| | |
Fulton Financial Corp.(a) | | | 36,550 | | | | 474,785 | |
| | |
Glacier Bancorp, Inc.(a) | | | 2,210 | | | | 66,720 | |
| | |
Great Southern Bancorp, Inc.(a) | | | 340 | | | | 16,905 | |
| | |
Hancock Whitney Corp. | | | 17,613 | | | | 606,416 | |
| | |
Hanmi Financial Corp. | | | 11,900 | | | | 174,692 | |
| | |
HarborOne Bancorp, Inc. | | | 1,881 | | | | 18,509 | |
| | |
Heartland Financial USA, Inc. | | | 11,390 | | | | 312,086 | |
| | |
Heritage Commerce Corp. | | | 23,290 | | | | 190,512 | |
| | |
Heritage Financial Corp. | | | 2,720 | | | | 44,254 | |
| | |
Hilltop Holdings, Inc.(a) | | | 4,760 | | | | 131,471 | |
| | |
Home BancShares, Inc.(a) | | | 37,060 | | | | 757,877 | |
| | |
Hope Bancorp, Inc. | | | 17,850 | | | | 156,366 | |
| | |
Horizon Bancorp, Inc. | | | 5,440 | | | | 51,626 | |
| | |
Huntington Bancshares, Inc. | | | 46,410 | | | | 447,857 | |
| | |
Independent Bank Corp. | | | 10,880 | | | | 530,944 | |
| | |
Independent Bank Group, Inc. | | | 5,610 | | | | 198,314 | |
| | |
International Bancshares Corp. | | | 12,312 | | | | 539,635 | |
| | |
JPMorgan Chase & Co. | | | 88,230 | | | | 12,269,264 | |
| | |
KeyCorp | | | 23,800 | | | | 243,236 | |
| | |
Lakeland Bancorp, Inc. | | | 11,115 | | | | 125,377 | |
| | |
Lakeland Financial Corp. | | | 684 | | | | 33,687 | |
| | |
Live Oak Bancshares, Inc. | | | 680 | | | | 19,618 | |
| | |
M&T Bank Corp.(a) | | | 5,723 | | | | 645,268 | |
| | |
Mercantile Bank Corp.(a) | | | 2,210 | | | | 72,797 | |
| | |
Midland States Bancorp, Inc. | | | 4,446 | | | | 97,012 | |
| | |
National Bank Holdings Corp., Class A | | | 7,990 | | | | 249,128 | |
| | |
NBT Bancorp, Inc.(a) | | | 340 | | | | 11,380 | |
| | |
New York Community Bancorp, Inc.(a) | | | 156,910 | | | | 1,487,507 | |
| | |
Nicolet Bankshares, Inc.(a) | | | 1,499 | | | | 109,157 | |
| | |
Northfield Bancorp, Inc. | | | 4,420 | | | | 38,012 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Northwest Bancshares, Inc.(a) | | | 26,010 | | | $ | 271,024 | |
| | |
OceanFirst Financial Corp.(a) | | | 14,535 | | | | 184,013 | |
| | |
OFG Bancorp | | | 12,410 | | | | 367,584 | |
| | |
Old National Bancorp(a) | | | 63,070 | | | | 864,059 | |
| | |
Old Second Bancorp, Inc.(a) | | | 4,250 | | | | 57,630 | |
| | |
Origin Bancorp, Inc.(a) | | | 3,570 | | | | 105,636 | |
| | |
Pacific Premier Bancorp, Inc. | | | 18,639 | | | | 354,141 | |
| | |
PacWest Bancorp | | | 32,470 | | | | 229,888 | |
| | |
Park National Corp.(a) | | | 342 | | | | 34,675 | |
| | |
Pathward Financial, Inc. | | | 2,736 | | | | 123,913 | |
| | |
Peoples Bancorp, Inc.(a) | | | 5,472 | | | | 150,918 | |
| | |
Pinnacle Financial Partners, Inc.(a) | | | 17,850 | | | | 1,113,126 | |
| | |
PNC Financial Services Group, Inc. (The) | | | 11,730 | | | | 1,342,733 | |
| | |
Popular, Inc. | | | 16,320 | | | | 1,061,453 | |
| | |
Preferred Bank(a) | | | 4,250 | | | | 253,172 | |
| | |
Premier Financial Corp. | | | 12,580 | | | | 218,263 | |
| | |
Prosperity Bancshares, Inc. | | | 19,152 | | | | 1,044,550 | |
| | |
Provident Financial Services, Inc.(a) | | | 20,740 | | | | 291,397 | |
| | |
QCR Holdings, Inc. | | | 1,881 | | | | 89,253 | |
| | |
Regions Financial Corp.(a) | | | 30,600 | | | | 444,618 | |
| | |
Renasant Corp.(a) | | | 10,370 | | | | 252,924 | |
| | |
S&T Bancorp, Inc.(a) | | | 7,310 | | | | 188,306 | |
| | |
Sandy Spring Bancorp, Inc. | | | 7,140 | | | | 146,013 | |
| | |
Seacoast Banking Corp. of Florida(a) | | | 7,650 | | | | 154,607 | |
| | |
ServisFirst Bancshares, Inc.(a) | | | 3,910 | | | | 184,396 | |
| | |
Simmons First National Corp., Class A | | | 24,795 | | | | 352,337 | |
| | |
Southern Missouri Bancorp, Inc.(a) | | | 4,250 | | | | 171,912 | |
| | |
Southside Bancshares, Inc.(a) | | | 4,250 | | | | 113,475 | |
| | |
SouthState Corp.(a) | | | 15,300 | | | | 1,011,330 | |
| | |
Stellar Bancorp, Inc.(a) | | | 9,180 | | | | 199,573 | |
| | |
Stock Yards Bancorp, Inc.(a) | | | 513 | | | | 20,063 | |
| | |
Synovus Financial Corp.(a) | | | 34,680 | | | | 904,108 | |
| | |
Texas Capital Bancshares, Inc.* (a) | | | 3,060 | | | | 168,484 | |
| | |
Tompkins Financial Corp.(a) | | | 171 | | | | 8,564 | |
See Accompanying Notes to the Financial Statements.
| | | | |
144 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Towne Bank | | | 12,996 | | | $ | 311,124 | |
| | |
TriCo Bancshares(a) | | | 513 | | | | 16,596 | |
| | |
Triumph Financial, Inc.* (a) | | | 2,210 | | | | 137,573 | |
| | |
Truist Financial Corp. | | | 43,520 | | | | 1,234,227 | |
| | |
TrustCo Bank Corp. NY(a) | | | 3,249 | | | | 82,947 | |
| | |
Trustmark Corp. | | | 17,000 | | | | 341,870 | |
| | |
UMB Financial Corp. | | | 9,690 | | | | 607,757 | |
| | |
United Bankshares, Inc.(a) | | | 8,160 | | | | 232,070 | |
| | |
United Community Banks, Inc.(a) | | | 23,800 | | | | 525,742 | |
| | |
Univest Financial Corp. | | | 5,472 | | | | 91,164 | |
| | |
US Bancorp(a) | | | 47,430 | | | | 1,512,068 | |
| | |
Valley National Bancorp(a) | | | 86,665 | | | | 674,254 | |
| | |
Veritex Holdings, Inc.(a) | | | 6,970 | | | | 120,023 | |
| | |
WaFd, Inc.(a) | | | 15,640 | | | | 385,995 | |
| | |
Washington Trust Bancorp, Inc. | | | 2,209 | | | | 51,227 | |
| | |
Webster Financial Corp. | | | 38,930 | | | | 1,478,172 | |
| | |
Wells Fargo & Co. | | | 111,690 | | | | 4,441,911 | |
| | |
WesBanco, Inc. | | | 11,799 | | | | 287,778 | |
| | |
Westamerica Bancorp | | | 5,780 | | | | 273,047 | �� |
| | |
Western Alliance Bancorp | | | 24,650 | | | | 1,013,115 | |
| | |
Wintrust Financial Corp. | | | 12,483 | | | | 932,355 | |
| | |
WSFS Financial Corp.(a) | | | 11,900 | | | | 421,260 | |
| | |
Zions Bancorp NA(a) | | | 34,680 | | | | 1,069,878 | |
| | | | | | | 74,244,680 | |
|
Beverages – 1.1% | |
| | |
Boston Beer Co., Inc. (The), Class A* | | | 340 | | | | 113,543 | |
| | |
Brown-Forman Corp., Class A | | | 1,368 | | | | 78,551 | |
| | |
Brown-Forman Corp., Class B(a) | | | 3,740 | | | | 210,038 | |
| | |
Celsius Holdings, Inc.* (a) | | | 1,881 | | | | 286,081 | |
| | |
Coca-Cola Co. (The) | | | 94,350 | | | | 5,329,832 | |
| | |
Coca-Cola Consolidated, Inc. | | | 340 | | | | 216,379 | |
| | |
Constellation Brands, Inc., Class A | | | 4,080 | | | | 955,332 | |
| | |
Duckhorn Portfolio, Inc. (The)* | | | 7,650 | | | | 79,790 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Beverages – (continued) | |
| | |
Keurig Dr Pepper, Inc.(a) | | | 27,880 | | | $ | 845,600 | |
| | |
MGP Ingredients, Inc. | | | 170 | | | | 16,092 | |
| | |
Molson Coors Beverage Co., Class B(a) | | | 6,327 | | | | 365,511 | |
| | |
Monster Beverage Corp.* | | | 18,810 | | | | 961,191 | |
| | |
National Beverage Corp.* | | | 1,026 | | | | 47,586 | |
| | |
PepsiCo, Inc. | | | 34,000 | | | | 5,551,520 | |
| | |
Vita Coco Co., Inc. (The)* (a) | | | 4,080 | | | | 110,568 | |
| | | | | | | 15,167,614 | |
|
Biotechnology – 2.4% | |
| | |
AbbVie, Inc. | | | 53,720 | | | | 7,584,190 | |
| | |
ACADIA Pharmaceuticals, Inc.* | | | 6,800 | | | | 153,476 | |
| | |
Agios Pharmaceuticals, Inc.* | | | 4,695 | | | | 98,642 | |
| | |
Akero Therapeutics, Inc.* | | | 2,380 | | | | 28,370 | |
| | |
Alkermes plc* | | | 5,440 | | | | 131,594 | |
| | |
Alnylam Pharmaceuticals, Inc.* | | | 3,060 | | | | 464,508 | |
| | |
Amgen, Inc. | | | 16,490 | | | | 4,216,493 | |
| | |
Amicus Therapeutics, Inc.* | | | 6,669 | | | | 73,159 | |
| | |
Anavex Life Sciences Corp.* (a) | | | 10,370 | | | | 57,865 | |
| | |
Apellis Pharmaceuticals, Inc.* (a) | | | 3,400 | | | | 165,444 | |
| | |
Arrowhead Pharmaceuticals, Inc.* | | | 5,610 | | | | 137,950 | |
| | |
Aurinia Pharmaceuticals, Inc.* (a) | | | 13,430 | | | | 98,576 | |
| | |
BioCryst Pharmaceuticals, Inc.* (a) | | | 17,170 | | | | 94,263 | |
| | |
Biogen, Inc.* | | | 3,740 | | | | 888,400 | |
| | |
Biohaven Ltd.* (a) | | | 14,280 | | | | 378,563 | |
| | |
BioMarin Pharmaceutical, Inc.* | | | 4,760 | | | | 387,702 | |
| | |
Blueprint Medicines Corp.* | | | 3,230 | | | | 190,118 | |
| | |
Bridgebio Pharma, Inc.* (a) | | | 5,270 | | | | 137,231 | |
| | |
CareDx, Inc.* | | | 21,930 | | | | 118,641 | |
| | |
Catalyst Pharmaceuticals, Inc.* (a) | | | 9,153 | | | | 113,589 | |
| | |
Cerevel Therapeutics Holdings, Inc.* | | | 2,907 | | | | 68,750 | |
| | |
CRISPR Therapeutics AG* (a) | | | 18,020 | | | | 701,519 | |
| | |
Cytokinetics, Inc.* (a) | | | 2,890 | | | | 100,745 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 145 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Biotechnology – (continued) | |
| | |
Deciphera Pharmaceuticals, Inc.* | | | 2,907 | | | $ | 34,855 | |
| | |
Denali Therapeutics, Inc.* | | | 3,400 | | | | 64,022 | |
| | |
Dynavax Technologies Corp.* (a) | | | 25,479 | | | | 362,057 | |
| | |
Editas Medicine, Inc.* (a) | | | 11,390 | | | | 76,085 | |
| | |
EQRx, Inc.* (a) | | | 89,080 | | | | 194,194 | |
| | |
Exact Sciences Corp.* | | | 5,440 | | | | 335,050 | |
| | |
Exelixis, Inc.* | | | 17,850 | | | | 367,531 | |
| | |
Geron Corp.* (a) | | | 14,877 | | | | 28,266 | |
| | |
Gilead Sciences, Inc. | | | 37,060 | | | | 2,910,692 | |
| | |
Halozyme Therapeutics, Inc.* | | | 7,140 | | | | 241,832 | |
| | |
ImmunoGen, Inc.* (a) | | | 5,440 | | | | 80,838 | |
| | |
Immunovant, Inc.* | | | 2,210 | | | | 73,040 | |
| | |
Incyte Corp.* | | | 3,570 | | | | 192,530 | |
| | |
Inhibrx, Inc.* | | | 513 | | | | 7,936 | |
| | |
Insmed, Inc.* (a) | | | 9,690 | | | | 242,831 | |
| | |
Intellia Therapeutics, Inc.* (a) | | | 5,270 | | | | 132,013 | |
| | |
Ionis Pharmaceuticals, Inc.* (a) | | | 6,840 | | | | 302,807 | |
| | |
Iovance Biotherapeutics, Inc.* | | | 2,736 | | | | 10,451 | |
| | |
Ironwood Pharmaceuticals, Inc., Class A* (a) | | | 20,230 | | | | 181,463 | |
| | |
Karuna Therapeutics, Inc.* (a) | | | 1,020 | | | | 169,942 | |
| | |
Karyopharm Therapeutics, Inc.* (a) | | | 6,669 | | | | 5,802 | |
| | |
Krystal Biotech, Inc.* (a) | | | 1,700 | | | | 198,679 | |
| | |
Kura Oncology, Inc.* (a) | | | 25,160 | | | | 212,602 | |
| | |
Lyell Immunopharma, Inc.* (a) | | | 28,220 | | | | 46,704 | |
| | |
Madrigal Pharmaceuticals, Inc.* | | | 340 | | | | 44,669 | |
| | |
MannKind Corp.* (a) | | | 7,182 | | | | 30,811 | |
| | |
Mirati Therapeutics, Inc.* | | | 3,570 | | | | 198,242 | |
| | |
Moderna, Inc.* (a) | | | 10,540 | | | | 800,618 | |
| | |
Morphic Holding, Inc.* | | | 2,890 | | | | 57,655 | |
| | |
Myriad Genetics, Inc.* (a) | | | 2,907 | | | | 45,291 | |
| | |
Natera, Inc.* (a) | | | 4,959 | | | | 195,732 | |
| | |
Neurocrine Biosciences, Inc.* | | | 2,052 | | | | 227,649 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Biotechnology – (continued) | |
| | |
Novavax, Inc.* (a) | | | 12,070 | | | $ | 80,386 | |
| | |
OmniAb, Inc.* ‡ (a) | | | 281 | | | | 149 | |
| | |
Prothena Corp. plc* (a) | | | 1,700 | | | | 61,982 | |
| | |
PTC Therapeutics, Inc.* | | | 3,249 | | | | 60,919 | |
| | |
Recursion Pharmaceuticals, Inc., Class A* (a) | | | 14,450 | | | | 76,296 | |
| | |
Regeneron Pharmaceuticals, Inc.* | | | 2,720 | | | | 2,121,301 | |
| | |
Relay Therapeutics, Inc.* | | | 9,520 | | | | 62,832 | |
| | |
Replimune Group, Inc.* | | | 15,980 | | | | 232,829 | |
| | |
REVOLUTION Medicines, Inc.* (a) | | | 6,120 | | | | 121,176 | |
| | |
Rocket Pharmaceuticals, Inc.* | | | 6,460 | | | | 116,926 | |
| | |
Sarepta Therapeutics, Inc.* (a) | | | 2,720 | | | | 183,083 | |
| | |
Seagen, Inc.* (a) | | | 3,230 | | | | 687,376 | |
| | |
Seres Therapeutics, Inc.* (a) | | | 2,052 | | | | 3,140 | |
| | |
SpringWorks Therapeutics, Inc.* (a) | | | 4,080 | | | | 93,432 | |
| | |
TG Therapeutics, Inc.* (a) | | | 7,353 | | | | 56,839 | |
| | |
Travere Therapeutics, Inc.* | | | 1,710 | | | | 11,081 | |
| | |
Twist Bioscience Corp.* | | | 1,530 | | | | 24,113 | |
| | |
Ultragenyx Pharmaceutical, Inc.* | | | 1,530 | | | | 54,162 | |
| | |
uniQure NV* (a) | | | 5,270 | | | | 30,039 | |
| | |
United Therapeutics Corp.* | | | 1,530 | | | | 340,976 | |
| | |
Vaxcyte, Inc.* (a) | | | 18,870 | | | | 907,647 | |
| | |
Veracyte, Inc.* (a) | | | 3,249 | | | | 67,319 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 6,460 | | | | 2,339,231 | |
| | |
Vir Biotechnology, Inc.* | | | 10,200 | | | | 80,886 | |
| | |
Zymeworks, Inc.* | | | 15,130 | | | | 106,213 | |
| | | | | | | 32,383,010 | |
|
Broadline Retail – 2.6% | |
| | |
Amazon.com, Inc.* | | | 224,400 | | | | 29,865,396 | |
| | |
Coupang, Inc., Class A* | | | 31,620 | | | | 537,540 | |
| | |
Dillard’s, Inc., Class A(a) | | | 510 | | | | 158,329 | |
| | |
eBay, Inc. | | | 17,340 | | | | 680,248 | |
| | |
Etsy, Inc.* (a) | | | 2,550 | | | | 158,865 | |
| | |
Kohl’s Corp.(a) | | | 21,930 | | | | 494,521 | |
| | |
Macy’s, Inc.(a) | | | 52,020 | | | | 633,604 | |
| | |
MercadoLibre, Inc.* | | | 1,190 | | | | 1,476,481 | |
See Accompanying Notes to the Financial Statements.
| | | | |
146 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Broadline Retail – (continued) | |
| | |
Nordstrom, Inc.(a) | | | 24,990 | | | $ | 349,360 | |
| | |
Ollie’s Bargain Outlet Holdings, Inc.* (a) | | | 3,078 | | | | 237,745 | |
| | | | | | | 34,592,089 | |
|
Building Products – 0.8% | |
| | |
A O Smith Corp. | | | 3,249 | | | | 226,650 | |
| | |
AAON, Inc.(a) | | | 3,591 | | | | 195,638 | |
| | |
Advanced Drainage Systems, Inc.(a) | | | 2,720 | | | | 290,578 | |
| | |
Allegion plc(a) | | | 1,870 | | | | 183,933 | |
| | |
American Woodmark Corp.* | | | 4,080 | | | | 274,298 | |
| | |
Apogee Enterprises, Inc.(a) | | | 2,720 | | | | 116,742 | |
| | |
Armstrong World Industries, Inc. | | | 850 | | | | 64,507 | |
| | |
AZEK Co., Inc. (The), Class A* | | | 4,080 | | | | 106,896 | |
| | |
AZZ, Inc.(a) | | | 7,140 | | | | 337,508 | |
| | |
Builders FirstSource, Inc.* | | | 4,420 | | | | 479,658 | |
| | |
Carlisle Cos., Inc.(a) | | | 1,368 | | | | 347,595 | |
| | |
Carrier Global Corp. | | | 22,230 | | | | 1,059,482 | |
| | |
Fortune Brands Innovations, Inc.(a) | | | 3,933 | | | | 219,461 | |
| | |
Gibraltar Industries, Inc.* (a) | | | 855 | | | | 52,035 | |
| | |
Griffon Corp. | | | 9,747 | | | | 389,295 | |
| | |
Hayward Holdings, Inc.* (a) | | | 11,730 | | | | 123,165 | |
| | |
Insteel Industries, Inc.(a) | | | 2,550 | | | | 71,171 | |
| | |
JELD-WEN Holding, Inc.* | | | 12,070 | | | | 136,753 | |
| | |
Johnson Controls International plc | | | 19,380 | | | | 950,008 | |
| | |
Lennox International, Inc. | | | 1,020 | | | | 377,951 | |
| | |
Masco Corp. | | | 6,840 | | | | 356,296 | |
| | |
Masonite International Corp.* | | | 4,250 | | | | 336,345 | |
| | |
Masterbrand, Inc.* | | | 24,650 | | | | 273,862 | |
| | |
Owens Corning | | | 3,400 | | | | 385,458 | |
| | |
PGT Innovations, Inc.* | | | 5,780 | | | | 173,053 | |
| | |
Quanex Building Products Corp.(a) | | | 4,275 | | | | 114,784 | |
| | |
Resideo Technologies, Inc.* (a) | | | 28,557 | | | | 413,505 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Building Products – (continued) | |
| | |
Simpson Manufacturing Co., Inc. | | | 1,539 | | | $ | 204,964 | |
| | |
Trane Technologies plc | | | 5,472 | | | | 1,041,376 | |
| | |
Trex Co., Inc.* (a) | | | 6,120 | | | | 344,005 | |
| | |
UFP Industries, Inc. | | | 12,654 | | | | 1,204,281 | |
| | |
Zurn Elkay Water Solutions Corp.(a) | | | 4,446 | | | | 117,641 | |
| | | | | | | 10,968,894 | |
|
Capital Markets – 2.8% | |
| | |
Affiliated Managers Group, Inc. | | | 8,330 | | | | 1,022,591 | |
| | |
Ameriprise Financial, Inc. | | | 2,720 | | | | 855,630 | |
| | |
Ares Management Corp., Class A | | | 3,420 | | | | 337,178 | |
| | |
Artisan Partners Asset Management, Inc., Class A(a) | | | 2,040 | | | | 67,320 | |
| | |
Avantax, Inc.* | | | 4,590 | | | | 118,468 | |
| | |
B. Riley Financial, Inc.(a) | | | 3,591 | | | | 130,030 | |
| | |
Bank of New York Mellon Corp. (The) | | | 21,760 | | | | 924,800 | |
| | |
BGC Group, Inc., Class A(a) | | | 69,530 | | | | 408,141 | |
| | |
BlackRock, Inc. | | | 4,250 | | | | 2,602,190 | |
| | |
Blackstone, Inc.(a) | | | 16,660 | | | | 1,538,551 | |
| | |
Blue Owl Capital, Inc., Class A(a) | | | 18,468 | | | | 227,710 | |
| | |
Brightsphere Investment Group, Inc. | | | 5,130 | | | | 80,336 | |
| | |
Carlyle Group, Inc. (The)(a) | | | 5,100 | | | | 140,454 | |
| | |
Charles Schwab Corp. (The) | | | 36,210 | | | | 1,884,368 | |
| | |
CME Group, Inc. | | | 8,500 | | | | 1,814,410 | |
| | |
Cohen & Steers, Inc.(a) | | | 1,530 | | | | 79,927 | |
| | |
Coinbase Global, Inc., Class A* (a) | | | 5,100 | | | | 393,312 | |
| | |
Donnelley Financial Solutions, Inc.* | | | 1,190 | | | | 64,772 | |
| | |
Evercore, Inc., Class A(a) | | | 1,870 | | | | 243,437 | |
| | |
FactSet Research Systems, Inc. | | | 855 | | | | 369,266 | |
| | |
Federated Hermes, Inc., Class B | | | 5,610 | | | | 177,837 | |
| | |
Franklin Resources, Inc.(a) | | | 10,089 | | | | 229,928 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 147 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
Goldman Sachs Group, Inc. (The) | | | 10,030 | | | $ | 3,045,208 | |
| | |
Hamilton Lane, Inc., Class A | | | 2,550 | | | | 214,506 | |
| | |
Houlihan Lokey, Inc., Class A(a) | | | 1,710 | | | | 171,889 | |
| | |
Interactive Brokers Group, Inc., Class A | | | 3,570 | | | | 285,850 | |
| | |
Intercontinental Exchange, Inc. | | | 14,096 | | | | 1,514,474 | |
| | |
Invesco Ltd. | | | 13,509 | | | | 175,212 | |
| | |
Janus Henderson Group plc(a) | | | 29,410 | | | | 678,489 | |
| | |
Jefferies Financial Group, Inc. | | | 37,910 | | | | 1,219,944 | |
| | |
KKR & Co., Inc. | | | 18,190 | | | | 1,007,726 | |
| | |
LPL Financial Holdings, Inc. | | | 2,210 | | | | 496,189 | |
| | |
MarketAxess Holdings, Inc. | | | 855 | | | | 182,756 | |
| | |
Moelis & Co., Class A(a) | | | 3,249 | | | | 135,288 | |
| | |
Moody’s Corp. | | | 4,080 | | | | 1,256,640 | |
| | |
Morgan Stanley | | | 39,780 | | | | 2,817,220 | |
| | |
Morningstar, Inc.(a) | | | 513 | | | | 129,912 | |
| | |
MSCI, Inc., Class A | | | 1,881 | | | | 886,986 | |
| | |
Nasdaq, Inc. | | | 8,208 | | | | 407,117 | |
| | |
Northern Trust Corp.(c) | | | 6,970 | | | | 459,393 | |
| | |
Oppenheimer Holdings, Inc., Class A | | | 342 | | | | 11,994 | |
| | |
Piper Sandler Cos.(a) | | | 1,190 | | | | 166,421 | |
| | |
PJT Partners, Inc., Class A | | | 342 | | | | 26,799 | |
| | |
Raymond James Financial, Inc.(a) | | | 5,440 | | | | 519,194 | |
| | |
Robinhood Markets, Inc., Class A* (a) | | | 19,210 | | | | 175,579 | |
| | |
S&P Global, Inc. | | | 8,160 | | | | 2,850,370 | |
| | |
SEI Investments Co. | | | 2,907 | | | | 155,990 | |
| | |
State Street Corp. | | | 10,431 | | | | 674,155 | |
| | |
Stifel Financial Corp.(a) | | | 21,590 | | | | 1,230,630 | |
| | |
StoneX Group, Inc.* (a) | | | 4,250 | | | | 405,110 | |
| | |
T. Rowe Price Group, Inc.(a) | | | 5,440 | | | | 492,320 | |
| | |
TPG, Inc., Class A(a) | | | 2,223 | | | | 61,444 | |
| | |
Tradeweb Markets, Inc., Class A | | | 5,610 | | | | 504,956 | |
| | |
Victory Capital Holdings, Inc., Class A | | | 5,472 | | | | 161,205 | |
| | |
Virtu Financial, Inc., Class A | | | 22,780 | | | | 421,202 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
Virtus Investment Partners, Inc.(a) | | | 1,190 | | | $ | 219,234 | |
| | |
WisdomTree, Inc.(a) | | | 171 | | | | 1,060 | |
| | | | | | | 36,873,118 | |
|
Chemicals – 1.6% | |
| | |
AdvanSix, Inc. | | | 7,650 | | | | 210,758 | |
| | |
Air Products and Chemicals, Inc. | | | 5,270 | | | | 1,488,459 | |
| | |
Albemarle Corp.(a) | | | 3,400 | | | | 431,052 | |
| | |
Ashland, Inc. | | | 1,881 | | | | 144,141 | |
| | |
Avient Corp. | | | 20,230 | | | | 639,673 | |
| | |
Axalta Coating Systems Ltd.* | | | 8,721 | | | | 228,752 | |
| | |
Balchem Corp. | | | 1,881 | | | | 218,647 | |
| | |
Cabot Corp. | | | 3,570 | | | | 237,334 | |
| | |
Celanese Corp., Class A(a) | | | 3,420 | | | | 391,624 | |
| | |
CF Industries Holdings, Inc. | | | 6,630 | | | | 528,941 | |
| | |
Chase Corp.(a) | | | 171 | | | | 21,727 | |
| | |
Chemours Co. (The) | | | 34,170 | | | | 823,839 | |
| | |
Corteva, Inc. | | | 16,660 | | | | 802,012 | |
| | |
Dow, Inc. | | | 22,440 | | | | 1,084,750 | |
| | |
DuPont de Nemours, Inc.(a) | | | 11,390 | | | | 830,103 | |
| | |
Eastman Chemical Co. | | | 3,933 | | | | 293,913 | |
| | |
Ecolab, Inc. | | | 5,780 | | | | 969,537 | |
| | |
Ecovyst, Inc.* | | | 1,197 | | | | 11,012 | |
| | |
Element Solutions, Inc.(a) | | | 13,167 | | | | 240,034 | |
| | |
FMC Corp. | | | 3,570 | | | | 189,924 | |
| | |
Ginkgo Bioworks Holdings, Inc., Class A* (a) | | | 77,860 | | | | 106,668 | |
| | |
Hawkins, Inc.(a) | | | 513 | | | | 29,462 | |
| | |
HB Fuller Co. | | | 1,539 | | | | 101,805 | |
| | |
Huntsman Corp. | | | 39,270 | | | | 916,169 | |
| | |
Innospec, Inc. | | | 684 | | | | 67,032 | |
| | |
International Flavors & Fragrances, Inc.(a) | | | 5,100 | | | | 348,585 | |
| | |
Koppers Holdings, Inc. | | | 3,570 | | | | 130,555 | |
| | |
Kronos Worldwide, Inc. | | | 3,230 | | | | 22,287 | |
| | |
Linde plc | | | 12,240 | | | | 4,677,638 | |
| | |
Livent Corp.* (a) | | | 7,182 | | | | 104,785 | |
| | |
LSB Industries, Inc.* (a) | | | 13,770 | | | | 125,445 | |
| | |
LyondellBasell Industries NV, Class A | | | 7,695 | | | | 694,397 | |
| | |
Mativ Holdings, Inc.(a) | | | 5,780 | | | | 75,718 | |
See Accompanying Notes to the Financial Statements.
| | | | |
148 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Minerals Technologies, Inc. | | | 3,060 | | | $ | 165,424 | |
| | |
Mosaic Co. (The) | | | 11,730 | | | | 380,990 | |
| | |
NewMarket Corp.(a) | | | 510 | | | | 245,896 | |
| | |
Olin Corp. | | | 5,270 | | | | 225,134 | |
| | |
Perimeter Solutions SA* (a) | | | 19,210 | | | | 61,472 | |
| | |
PPG Industries, Inc. | | | 5,270 | | | | 646,998 | |
| | |
PureCycle Technologies, Inc.* (a) | | | 29,750 | | | | 132,387 | |
| | |
Quaker Chemical Corp. | | | 855 | | | | 122,881 | |
| | |
RPM International, Inc. | | | 2,736 | | | | 249,715 | |
| | |
Scotts Miracle-Gro Co. (The)(a) | | | 3,400 | | | | 151,096 | |
| | |
Sensient Technologies Corp.(a) | | | 2,210 | | | | 124,688 | |
| | |
Sherwin-Williams Co. (The) | | | 5,610 | | | | 1,336,358 | |
| | |
Stepan Co. | | | 1,530 | | | | 114,444 | |
| | |
Trinseo plc | | | 4,250 | | | | 26,308 | |
| | |
Tronox Holdings plc(a) | | | 21,546 | | | | 230,327 | |
| | |
Westlake Corp.(a) | | | 510 | | | | 58,834 | |
| | | | | | | 21,459,730 | |
|
Commercial Services & Supplies – 0.8% | |
| | |
ABM Industries, Inc.(a) | | | 12,240 | | | | 481,522 | |
| | |
ACCO Brands Corp. | | | 28,900 | | | | 146,234 | |
| | |
ACV Auctions, Inc., Class A* (a) | | | 7,820 | | | | 104,241 | |
| | |
Brady Corp., Class A | | | 1,026 | | | | 52,798 | |
| | |
BrightView Holdings, Inc.* | | | 7,011 | | | | 47,254 | |
| | |
Brink’s Co. (The) | | | 9,918 | | | | 663,117 | |
| | |
Casella Waste Systems, Inc., Class A* (a) | | | 2,052 | | | | 154,823 | |
| | |
Cimpress plc* | | | 5,100 | | | | 304,317 | |
| | |
Cintas Corp. | | | 2,052 | | | | 1,040,610 | |
| | |
Clean Harbors, Inc.* (a) | | | 1,870 | | | | 287,363 | |
| | |
Copart, Inc.* | | | 21,760 | | | | 946,995 | |
| | |
CoreCivic, Inc.* | | | 17,000 | | | | 215,900 | |
| | |
Deluxe Corp.(a) | | | 10,370 | | | | 176,809 | |
| | |
Ennis, Inc.(a) | | | 4,590 | | | | 98,042 | |
| | |
Enviri Corp.* (a) | | | 21,250 | | | | 121,975 | |
| | |
GEO Group, Inc. (The)* (a) | | | 22,780 | | | | 199,097 | |
| | |
Healthcare Services Group, Inc. | | | 6,290 | | | | 59,755 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Commercial Services & Supplies – (continued) | |
| | |
HNI Corp. | | | 3,420 | | | $ | 118,640 | |
| | |
Interface, Inc., Class A | | | 21,590 | | | | 191,935 | |
| | |
Liquidity Services, Inc.* | | | 513 | | | | 9,886 | |
| | |
Matthews International Corp., Class A(a) | | | 3,400 | | | | 120,496 | |
| | |
MillerKnoll, Inc.(a) | | | 21,590 | | | | 507,365 | |
| | |
Montrose Environmental Group, Inc.* | | | 2,890 | | | | 66,817 | |
| | |
MSA Safety, Inc.(a) | | | 2,210 | | | | 348,915 | |
| | |
OPENLANE, Inc.* | | | 3,060 | | | | 41,096 | |
| | |
Republic Services, Inc., Class A | | | 5,130 | | | | 761,754 | |
| | |
Rollins, Inc. | | | 6,327 | | | | 237,958 | |
| | |
SP Plus Corp.* | | | 3,230 | | | | 163,212 | |
| | |
Steelcase, Inc., Class A(a) | | | 30,260 | | | | 330,137 | |
| | |
Stericycle, Inc.* (a) | | | 5,440 | | | | 224,346 | |
| | |
Tetra Tech, Inc.(a) | | | 1,710 | | | | 258,056 | |
| | |
UniFirst Corp.(a) | | | 1,026 | | | | 168,705 | |
| | |
Viad Corp.* (a) | | | 2,223 | | | | 53,863 | |
| | |
Waste Management, Inc. | | | 9,234 | | | | 1,517,423 | |
| | | | | | | 10,221,456 | |
|
Communications Equipment – 0.8% | |
| | |
ADTRAN Holdings, Inc.(a) | | | 22,270 | | | | 146,314 | |
| | |
Arista Networks, Inc.* | | | 6,120 | | | | 1,226,264 | |
| | |
Calix, Inc.* | | | 3,591 | | | | 118,934 | |
| | |
Ciena Corp.* (a) | | | 6,120 | | | | 258,264 | |
| | |
Cisco Systems, Inc. | | | 122,060 | | | | 6,362,988 | |
| | |
CommScope Holding Co., Inc.* | | | 56,950 | | | | 84,286 | |
| | |
Digi International, Inc.* (a) | | | 3,420 | | | | 86,116 | |
| | |
Extreme Networks, Inc.* (a) | | | 9,350 | | | | 192,797 | |
| | |
F5, Inc.* | | | 1,368 | | | | 207,375 | |
| | |
Harmonic, Inc.* (a) | | | 2,565 | | | | 27,676 | |
| | |
Infinera Corp.* (a) | | | 6,669 | | | | 19,540 | |
| | |
Juniper Networks, Inc. | | | 10,370 | | | | 279,160 | |
| | |
Lumentum Holdings, Inc.* (a) | | | 1,190 | | | | 46,660 | |
| | |
Motorola Solutions, Inc. | | | 4,275 | | | | 1,190,417 | |
| | |
NetScout Systems, Inc.* (a) | | | 5,359 | | | | 116,987 | |
| | |
Viasat, Inc.* (a) | | | 15,810 | | | | 291,537 | |
| | |
Viavi Solutions, Inc.* | | | 6,630 | | | | 51,581 | |
| | | | | | | 10,706,896 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 149 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Construction & Engineering – 0.4% | |
| | |
AECOM(a) | | | 4,330 | | | $ | 331,462 | |
| | |
Ameresco, Inc., Class A* (a) | | | 1,197 | | | | 31,302 | |
| | |
API Group Corp.* (a) | | | 6,630 | | | | 171,518 | |
| | |
Arcosa, Inc. | | | 1,368 | | | | 94,488 | |
| | |
Argan, Inc. | | | 1,710 | | | | 78,215 | |
| | |
Comfort Systems USA, Inc.(a) | | | 2,040 | | | | 370,974 | |
| | |
Construction Partners, Inc., Class A* | | | 855 | | | | 32,875 | |
| | |
Dycom Industries, Inc.* (a) | | | 1,368 | | | | 116,526 | |
| | |
EMCOR Group, Inc. | | | 1,530 | | | | 316,174 | |
| | |
Fluor Corp.* | | | 5,814 | | | | 193,548 | |
| | |
Granite Construction, Inc.(a) | | | 3,420 | | | | 138,442 | |
| | |
IES Holdings, Inc.* | | | 1,870 | | | | 116,370 | |
| | |
MasTec, Inc.* | | | 3,570 | | | | 212,201 | |
| | |
MDU Resources Group, Inc. | | | 42,221 | | | | 785,733 | |
| | |
MYR Group, Inc.* | | | 1,360 | | | | 157,529 | |
| | |
Primoris Services Corp. | | | 10,431 | | | | 313,556 | |
| | |
Quanta Services, Inc.(a) | | | 3,910 | | | | 653,439 | |
| | |
Sterling Infrastructure, Inc.* (a) | | | 5,985 | | | | 436,007 | |
| | |
Valmont Industries, Inc. | | | 850 | | | | 167,373 | |
| | |
WillScot Mobile Mini Holdings Corp.* | | | 6,815 | | | | 268,579 | |
| | | | | | | 4,986,311 | |
|
Construction Materials – 0.1% | |
| | |
Eagle Materials, Inc. | | | 1,710 | | | | 263,186 | |
| | |
Martin Marietta Materials, Inc. | | | 1,539 | | | | 629,359 | |
| | |
Summit Materials, Inc., Class A* | | | 5,050 | | | | 166,145 | |
| | |
Vulcan Materials Co.(a) | | | 3,078 | | | | 604,796 | |
| | | | | | | 1,663,486 | |
|
Consumer Finance – 0.7% | |
| | |
Ally Financial, Inc.(a) | | | 11,050 | | | | 267,300 | |
| | |
American Express Co. | | | 17,510 | | | | 2,556,985 | |
| | |
Bread Financial Holdings, Inc. | | | 11,900 | | | | 321,657 | |
| | |
Capital One Financial Corp. | | | 12,335 | | | | 1,249,412 | |
| | |
Credit Acceptance Corp.* | | | 286 | | | | 115,095 | |
| | |
Discover Financial Services | | | 7,820 | | | | 641,866 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Consumer Finance – (continued) | |
| | |
Encore Capital Group, Inc.* (a) | | | 6,290 | | | $ | 237,007 | |
| | |
Enova International, Inc.* | | | 7,353 | | | | 293,238 | |
| | |
EZCORP, Inc., Class A* (a) | | | 3,400 | | | | 27,880 | |
| | |
FirstCash Holdings, Inc. | | | 1,368 | | | | 149,003 | |
| | |
Green Dot Corp., Class A* (a) | | | 13,940 | | | | 155,849 | |
| | |
LendingClub Corp.* | | | 6,290 | | | | 32,645 | |
| | |
Navient Corp.(a) | | | 23,256 | | | | 370,003 | |
| | |
Nelnet, Inc., Class A | | | 1,530 | | | | 129,759 | |
| | |
NerdWallet, Inc., Class A* (a) | | | 10,540 | | | | 113,621 | |
| | |
OneMain Holdings, Inc. | | | 25,500 | | | | 916,215 | |
| | |
PROG Holdings, Inc.* (a) | | | 7,650 | | | | 209,533 | |
| | |
SLM Corp. | | | 55,590 | | | | 722,670 | |
| | |
SoFi Technologies, Inc.* (a) | | | 43,350 | | | | 327,293 | |
| | |
Synchrony Financial | | | 10,030 | | | | 281,342 | |
| | |
Upstart Holdings, Inc.* (a) | | | 4,080 | | | | 98,042 | |
| | |
World Acceptance Corp.* | | | 342 | | | | 33,728 | |
| | | | | | | 9,250,143 | |
|
Consumer Staples Distribution & Retail – 1.5% | |
| | |
Albertsons Cos., Inc., Class A | | | 8,670 | | | | 188,139 | |
| | |
Andersons, Inc. (The) | | | 6,800 | | | | 340,884 | |
| | |
BJ’s Wholesale Club Holdings, Inc.* (a) | | | 4,185 | | | | 285,082 | |
| | |
Casey’s General Stores, Inc.(a) | | | 1,190 | | | | 323,573 | |
| | |
Chefs’ Warehouse, Inc. (The)* | | | 3,570 | | | | 67,937 | |
| | |
Costco Wholesale Corp. | | | 11,050 | | | | 6,104,462 | |
| | |
Dollar General Corp. | | | 5,100 | | | | 607,104 | |
| | |
Dollar Tree, Inc.* (a) | | | 4,930 | | | | 547,674 | |
| | |
Grocery Outlet Holding Corp.* (a) | | | 2,907 | | | | 80,437 | |
| | |
Ingles Markets, Inc., Class A(a) | | | 1,360 | | | | 109,099 | |
| | |
Kroger Co. (The) | | | 21,080 | | | | 956,400 | |
| | |
Performance Food Group Co.* | | | 3,740 | | | | 216,022 | |
| | |
PriceSmart, Inc. | | | 342 | | | | 21,371 | |
| | |
SpartanNash Co. | | | 8,160 | | | | 183,518 | |
| | |
Sprouts Farmers Market, Inc.* (a) | | | 24,310 | | | | 1,021,506 | |
See Accompanying Notes to the Financial Statements.
| | | | |
150 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Sysco Corp. | | | 12,312 | | | $ | 818,625 | |
| | |
Target Corp. | | | 14,280 | | | | 1,582,081 | |
| | |
United Natural Foods, Inc.* | | | 13,600 | | | | 198,288 | |
| | |
US Foods Holding Corp.* | | | 7,140 | | | | 278,032 | |
| | |
Walgreens Boots Alliance, Inc.(a) | | | 20,400 | | | | 430,032 | |
| | |
Walmart, Inc. | | | 34,680 | | | | 5,667,059 | |
| | |
Weis Markets, Inc.(a) | | | 1,676 | | | | 109,108 | |
| | | | | | | 20,136,433 | |
|
Containers & Packaging – 0.6% | |
| | |
Amcor plc | | | 34,510 | | | | 306,794 | |
| | |
AptarGroup, Inc. | | | 2,210 | | | | 270,217 | |
| | |
Avery Dennison Corp. | | | 1,710 | | | | 297,660 | |
| | |
Ball Corp.(a) | | | 9,180 | | | | 442,017 | |
| | |
Berry Global Group, Inc. | | | 25,330 | | | | 1,393,150 | |
| | |
Crown Holdings, Inc. | | | 4,250 | | | | 342,550 | |
| | |
Graphic Packaging Holding Co.(a) | | | 63,410 | | | | 1,363,949 | |
| | |
Greif, Inc., Class A(a) | | | 5,643 | | | | 358,331 | |
| | |
Greif, Inc., Class B | | | 170 | | | | 10,890 | |
| | |
International Paper Co. | | | 7,990 | | | | 269,503 | |
| | |
Myers Industries, Inc. | | | 171 | | | | 2,868 | |
| | |
O-I Glass, Inc.* (a) | | | 29,920 | | | | 462,264 | |
| | |
Packaging Corp. of America | | | 2,907 | | | | 444,916 | |
| | |
Pactiv Evergreen, Inc. | | | 13,260 | | | | 114,301 | |
| | |
Sealed Air Corp. | | | 4,590 | | | | 141,326 | |
| | |
Silgan Holdings, Inc.(a) | | | 5,440 | | | | 217,926 | |
| | |
Sonoco Products Co.(a) | | | 20,060 | | | | 1,039,309 | |
| | |
TriMas Corp.(a) | | | 1,368 | | | | 33,119 | |
| | |
Westrock Co. | | | 5,440 | | | | 195,459 | |
| | | | | | | 7,706,549 | |
|
Distributors – 0.1% | |
| | |
Genuine Parts Co. | | | 3,910 | | | | 503,843 | |
| | |
LKQ Corp. | | | 9,234 | | | | 405,557 | |
| | |
Pool Corp.(a) | | | 1,190 | | | | 375,766 | |
| | | | | | | 1,285,166 | |
|
Diversified Consumer Services – 0.2% | |
| | |
Adtalem Global Education, Inc.* (a) | | | 4,080 | | | | 211,344 | |
| | |
Bright Horizons Family Solutions, Inc.* (a) | | | 3,400 | | | | 251,804 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Diversified Consumer Services – (continued) | |
| | |
Coursera, Inc.* | | | 7,820 | | | $ | 135,599 | |
| | |
Duolingo, Inc., Class A* (a) | | | 1,020 | | | | 148,971 | |
| | |
Frontdoor, Inc.* | | | 2,380 | | | | 68,853 | |
| | |
Graham Holdings Co., Class B | | | 855 | | | | 494,806 | |
| | |
Grand Canyon Education, Inc.* | | | 1,190 | | | | 140,813 | |
| | |
H&R Block, Inc.(a) | | | 9,010 | | | | 369,861 | |
| | |
Laureate Education, Inc. | | | 9,180 | | | | 129,805 | |
| | |
OneSpaWorld Holdings Ltd.* (a) | | | 8,721 | | | | 91,396 | |
| | |
Perdoceo Education Corp. | | | 11,970 | | | | 216,537 | |
| | |
Rover Group, Inc., Class A* (a) | | | 18,360 | | | | 118,422 | |
| | |
Service Corp. International(a) | | | 4,446 | | | | 241,951 | |
| | |
Strategic Education, Inc.(a) | | | 1,710 | | | | 140,750 | |
| | |
Stride, Inc.* (a) | | | 3,719 | | | | 204,471 | |
| | |
Udemy, Inc.* (a) | | | 1,368 | | | | 12,216 | |
| | | | | | | 2,977,599 | |
|
Diversified REITs – 0.1% | |
| | |
Alexander & Baldwin, Inc., REIT | | | 2,907 | | | | 45,931 | |
| | |
Armada Hoffler Properties, Inc., REIT | | | 1,360 | | | | 13,546 | |
| | |
Broadstone Net Lease, Inc., REIT | | | 2,890 | | | | 40,893 | |
| | |
Empire State Realty Trust, Inc., Class A, REIT(a) | | | 15,470 | | | | 125,152 | |
| | |
Essential Properties Realty Trust, Inc., REIT(a) | | | 8,037 | | | | 176,412 | |
| | |
Global Net Lease, Inc., REIT(a) | | | 48,791 | | | | 387,401 | |
| | |
WP Carey, Inc., REIT | | | 5,440 | | | | 291,856 | |
| | | | | | | 1,081,191 | |
|
Diversified Telecommunication Services – 0.7% | |
| | |
Anterix, Inc.* (a) | | | 3,230 | | | | 98,483 | |
| | |
AT&T, Inc. | | | 210,800 | | | | 3,246,320 | |
| | |
ATN International, Inc. | | | 680 | | | | 21,046 | |
| | |
Cogent Communications Holdings, Inc. | | | 3,060 | | | | 198,839 | |
| | |
Consolidated Communications Holdings, Inc.* | | | 12,996 | | | | 54,193 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 151 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Diversified Telecommunication Services – (continued) | |
| | |
EchoStar Corp., Class A* | | | 6,290 | | | $ | 87,179 | |
| | |
Frontier Communications Parent, Inc.* (a) | | | 15,640 | | | | 280,269 | |
| | |
Iridium Communications, Inc. | | | 6,840 | | | | 253,422 | |
| | |
Liberty Latin America Ltd., Class A* | | | 10,880 | | | | 74,310 | |
| | |
Liberty Latin America Ltd., Class C* | | | 15,300 | | | | 104,805 | |
| | |
Lumen Technologies, Inc.* (a) | | | 159,290 | | | | 232,563 | |
| | |
Verizon Communications, Inc. | | | 124,950 | | | | 4,389,494 | |
| | | | | | | 9,040,923 | |
|
Electric Utilities – 1.3% | |
| | |
ALLETE, Inc. | | | 1,700 | | | | 91,018 | |
| | |
Alliant Energy Corp. | | | 7,182 | | | | 350,410 | |
| | |
American Electric Power Co., Inc. | | | 15,980 | | | | 1,207,129 | |
| | |
Constellation Energy Corp. | | | 7,480 | | | | 844,642 | |
| | |
Duke Energy Corp. | | | 23,970 | | | | 2,130,693 | |
| | |
Edison International | | | 10,710 | | | | 675,373 | |
| | |
Entergy Corp. | | | 5,950 | | | | 568,760 | |
| | |
Evergy, Inc. | | | 5,950 | | | | 292,383 | |
| | |
Eversource Energy | | | 7,140 | | | | 384,061 | |
| | |
Exelon Corp. | | | 26,520 | | | | 1,032,689 | |
| | |
FirstEnergy Corp.(a) | | | 16,758 | | | | 596,585 | |
| | |
Hawaiian Electric Industries, Inc. | | | 6,156 | | | | 79,905 | |
| | |
IDACORP, Inc.(a) | | | 2,736 | | | | 259,126 | |
| | |
MGE Energy, Inc. | | | 1,026 | | | | 73,492 | |
| | |
NextEra Energy, Inc. | | | 51,000 | | | | 2,973,300 | |
| | |
NRG Energy, Inc.(a) | | | 8,721 | | | | 369,596 | |
| | |
OGE Energy Corp. | | | 7,728 | | | | 264,298 | |
| | |
Otter Tail Corp.(a) | | | 3,060 | | | | 235,436 | |
| | |
PG&E Corp.* | | | 58,480 | | | | 953,224 | |
| | |
Pinnacle West Capital Corp. | | | 3,591 | | | | 266,380 | |
| | |
PNM Resources, Inc. | | | 4,788 | | | | 202,341 | |
| | |
Portland General Electric Co. | | | 5,610 | | | | 224,512 | |
| | |
PPL Corp. | | | 15,810 | | | | 388,452 | |
| | |
Southern Co. (The) | | | 32,640 | | | | 2,196,672 | |
| | |
Xcel Energy, Inc. | | | 13,770 | | | | 816,148 | |
| | | | | | | 17,476,625 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electrical Equipment – 0.8% | |
| | |
Acuity Brands, Inc.(a) | | | 1,870 | | | $ | 302,884 | |
| | |
AMETEK, Inc. | | | 5,270 | | | | 741,858 | |
| | |
Array Technologies, Inc.* (a) | | | 4,080 | | | | 70,706 | |
| | |
Atkore, Inc.* (a) | | | 8,840 | | | | 1,098,635 | |
| | |
Blink Charging Co.* (a) | | | 17,680 | | | | 42,078 | |
| | |
Bloom Energy Corp., Class A* (a) | | | 15,130 | | | | 157,352 | |
| | |
ChargePoint Holdings, Inc.* (a) | | | 1,190 | | | | 3,023 | |
| | |
Eaton Corp. plc | | | 9,747 | | | | 2,026,499 | |
| | |
Emerson Electric Co. | | | 14,790 | | | | 1,315,866 | |
| | |
Encore Wire Corp.(a) | | | 3,933 | | | | 703,338 | |
| | |
EnerSys | | | 1,026 | | | | 87,805 | |
| | |
Enovix Corp.* (a) | | | 10,030 | | | | 89,367 | |
| | |
Fluence Energy, Inc., Class A* (a) | | | 6,669 | | | | 115,507 | |
| | |
FREYR Battery SA* (a) | | | 25,840 | | | | 82,946 | |
| | |
FuelCell Energy, Inc.* (a) | | | 42,330 | | | | 46,140 | |
| | |
Generac Holdings, Inc.* (a) | | | 3,230 | | | | 271,546 | |
| | |
Hubbell, Inc., Class B | | | 1,197 | | | | 323,310 | |
| | |
NEXTracker, Inc., Class A* (a) | | | 3,060 | | | | 106,366 | |
| | |
nVent Electric plc | | | 9,010 | | | | 433,651 | |
| | |
Plug Power, Inc.* (a) | | | 29,920 | | | | 176,229 | |
| | |
Preformed Line Products Co. | | | 170 | | | | 23,010 | |
| | |
Regal Rexnord Corp.(a) | | | 2,052 | | | | 242,977 | |
| | |
Rockwell Automation, Inc. | | | 2,736 | | | | 719,048 | |
| | |
Sensata Technologies Holding plc | | | 6,460 | | | | 205,945 | |
| | |
Shoals Technologies Group, Inc., Class A* (a) | | | 6,290 | | | | 96,615 | |
| | |
Stem, Inc.* (a) | | | 35,360 | | | | 119,517 | |
| | |
SunPower Corp.* (a) | | | 5,985 | | | | 25,556 | |
| | |
Sunrun, Inc.* (a) | | | 43,931 | | | | 423,934 | |
| | |
Vertiv Holdings Co., Class A | | | 13,430 | | | | 527,396 | |
| | |
Vicor Corp.* (a) | | | 2,210 | | | | 85,616 | |
| | | | | | | 10,664,720 | |
|
Electronic Equipment, Instruments & Components – 1.2% | |
| | |
Advanced Energy Industries, Inc.(a) | | | 1,026 | | | | 89,529 | |
| | |
Amphenol Corp., Class A | | | 13,940 | | | | 1,122,867 | |
| | |
Arrow Electronics, Inc.* | | | 11,730 | | | | 1,330,299 | |
See Accompanying Notes to the Financial Statements.
| | | | |
152 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Avnet, Inc. | | | 19,836 | | | $ | 919,002 | |
| | |
Badger Meter, Inc. | | | 1,870 | | | | 259,088 | |
| | |
Bel Fuse, Inc., Class B | | | 680 | | | | 36,842 | |
| | |
Belden, Inc. | | | 2,720 | | | | 192,848 | |
| | |
Benchmark Electronics, Inc. | | | 8,208 | | | | 198,716 | |
| | |
CDW Corp. | | | 3,078 | | | | 616,831 | |
| | |
Cognex Corp.(a) | | | 5,270 | | | | 189,667 | |
| | |
Coherent Corp.* | | | 28,221 | | | | 835,329 | |
| | |
Corning, Inc. | | | 21,250 | | | | 568,650 | |
| | |
Crane NXT Co.(a) | | | 9,180 | | | | 477,360 | |
| | |
CTS Corp. | | | 855 | | | | 31,986 | |
| | |
ePlus, Inc.* | | | 6,460 | | | | 403,750 | |
| | |
Fabrinet* (a) | | | 2,052 | | | | 318,060 | |
| | |
Flex Ltd.* | | | 17,271 | | | | 444,210 | |
| | |
Insight Enterprises, Inc.* (a) | | | 6,970 | | | | 998,801 | |
| | |
IPG Photonics Corp.* | | | 2,040 | | | | 175,236 | |
| | |
Itron, Inc.* | | | 1,881 | | | | 107,744 | |
| | |
Jabil, Inc.(a) | | | 4,760 | | | | 584,528 | |
| | |
Keysight Technologies, Inc.* | | | 4,446 | | | | 542,634 | |
| | |
Kimball Electronics, Inc.* | | | 3,400 | | | | 89,080 | |
| | |
Knowles Corp.* (a) | | | 2,565 | | | | 33,319 | |
| | |
Lightwave Logic, Inc.* (a) | | | 855 | | | | 3,873 | |
| | |
Littelfuse, Inc. | | | 1,020 | | | | 221,003 | |
| | |
Methode Electronics, Inc. | | | 3,400 | | | | 77,758 | |
| | |
Mirion Technologies, Inc., Class A* (a) | | | 28,390 | | | | 196,743 | |
| | |
nLight, Inc.* | | | 8,160 | | | | 67,973 | |
| | |
Novanta, Inc.* | | | 1,881 | | | | 248,405 | |
| | |
OSI Systems, Inc.* | | | 510 | | | | 53,178 | |
| | |
PC Connection, Inc. | | | 171 | | | | 9,162 | |
| | |
Plexus Corp.* (a) | | | 680 | | | | 66,858 | |
| | |
Rogers Corp.* | | | 680 | | | | 83,565 | |
| | |
Sanmina Corp.* (a) | | | 13,260 | | | | 674,536 | |
| | |
ScanSource, Inc.* | | | 3,933 | | | | 119,563 | |
| | |
SmartRent, Inc., Class A* (a) | | | 33,490 | | | | 80,711 | |
| | |
TD SYNNEX Corp. | | | 684 | | | | 62,709 | |
| | |
TE Connectivity Ltd. | | | 8,500 | | | | 1,001,725 | |
| | |
Teledyne Technologies, Inc.* | | | 1,197 | | | | 448,384 | |
| | |
Trimble, Inc.* | | | 6,156 | | | | 290,132 | |
| | |
TTM Technologies, Inc.* | | | 20,691 | | | | 237,740 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Vishay Intertechnology, Inc.(a) | | | 25,308 | | | $ | 562,850 | |
| | |
Vontier Corp. | | | 33,150 | | | | 979,914 | |
| | |
Zebra Technologies Corp., Class A* (a) | | | 1,190 | | | | 249,222 | |
| | | | | | | 16,302,380 | |
|
Energy Equipment & Services – 0.8% | |
| | |
Archrock, Inc. | | | 12,825 | | | | 162,493 | |
| | |
Atlas Energy Solutions, Inc.(a) | | | 2,720 | | | | 49,531 | |
| | |
Baker Hughes Co., Class A | | | 22,572 | | | | 776,928 | |
| | |
Cactus, Inc., Class A(a) | | | 4,275 | | | | 200,669 | |
| | |
ChampionX Corp.(a) | | | 11,220 | | | | 345,576 | |
| | |
Dril-Quip, Inc.* | | | 171 | | | | 3,704 | |
| | |
Halliburton Co. | | | 27,710 | | | | 1,090,111 | |
| | |
Helix Energy Solutions Group, Inc.* | | | 13,940 | | | | 136,612 | |
| | |
Helmerich & Payne, Inc.(a) | | | 23,630 | | | | 935,039 | |
| | |
Liberty Energy, Inc., Class A(a) | | | 38,930 | | | | 766,921 | |
| | |
Nabors Industries Ltd.* | | | 850 | | | | 83,019 | |
| | |
NOV, Inc. | | | 21,760 | | | | 434,330 | |
| | |
Oceaneering International, Inc.* | | | 8,330 | | | | 183,177 | |
| | |
Oil States International, Inc.* | | | 513 | | | | 3,724 | |
| | |
Patterson-UTI Energy, Inc.(a) | | | 75,835 | | | | 963,105 | |
| | |
ProPetro Holding Corp.* (a) | | | 27,370 | | | | 286,838 | |
| | |
RPC, Inc.(a) | | | 12,240 | | | | 101,837 | |
| | |
Schlumberger NV | | | 41,820 | | | | 2,327,701 | |
| | |
Select Water Solutions, Inc., Class A | | | 12,410 | | | | 92,330 | |
| | |
Tidewater, Inc.* (a) | | | 1,360 | | | | 92,956 | |
| | |
Transocean Ltd.* (a) | | | 143,310 | | | | 948,712 | |
| | |
US Silica Holdings, Inc.* | | | 17,000 | | | | 205,190 | |
| | |
Valaris Ltd.* | | | 1,700 | | | | 112,268 | |
| | |
Weatherford International plc* (a) | | | 4,080 | | | | 379,807 | |
| | | | | | | 10,682,578 | |
|
Entertainment – 1.0% | |
| | |
AMC Entertainment Holdings, Inc., Class A* | | | 271 | | | | 2,894 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 153 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Entertainment – (continued) | |
| | |
Atlanta Braves Holdings, Inc., Class C* (a) | | | 203 | | | $ | 7,060 | |
| | |
Cinemark Holdings, Inc.* (a) | | | 9,860 | | | | 162,591 | |
| | |
Electronic Arts, Inc. | | | 6,120 | | | | 757,595 | |
| | |
Endeavor Group Holdings, Inc., Class A | | | 10,200 | | | | 232,152 | |
| | |
IMAX Corp.* | | | 1,881 | | | | 34,253 | |
| | |
Liberty Media Corp-Liberty Formula One, Class A* | | | 1,710 | | | | 98,411 | |
| | |
Liberty Media Corp-Liberty Formula One, Class C* | | | 5,301 | | | | 342,922 | |
| | |
Lions Gate Entertainment Corp., Class B* | | | 10,200 | | | | 76,092 | |
| | |
Live Nation Entertainment, Inc.* | | | 4,420 | | | | 353,688 | |
| | |
Madison Square Garden Sports Corp.* | | | 510 | | | | 85,751 | |
| | |
Netflix, Inc.* | | | 11,050 | | | | 4,549,175 | |
| | |
Playtika Holding Corp.* | | | 8,670 | | | | 72,828 | |
| | |
ROBLOX Corp., Class A* (a) | | | 10,880 | | | | 346,093 | |
| | |
Roku, Inc., Class A* (a) | | | 5,440 | | | | 324,061 | |
| | |
Sphere Entertainment Co.* | | | 6,630 | | | | 218,193 | |
| | |
Take-Two Interactive Software, Inc.* | | | 4,250 | | | | 568,438 | |
| | |
TKO Group Holdings, Inc.(a) | | | 2,380 | | | | 195,112 | |
| | |
Walt Disney Co. (The)* | | | 44,710 | | | | 3,647,889 | |
| | |
Warner Bros Discovery, Inc.* | | | 72,760 | | | | 723,234 | |
| | |
Warner Music Group Corp., Class A | | | 4,080 | | | | 127,704 | |
| | | | | | | 12,926,136 | |
|
Financial Services – 4.1% | |
| | |
Affirm Holdings, Inc., Class A* (a) | | | 47,940 | | | | 844,223 | |
| | |
A-Mark Precious Metals, Inc.(a) | | | 2,736 | | | | 74,091 | |
| | |
Apollo Global Management, Inc. | | | 14,280 | | | | 1,105,843 | |
| | |
AvidXchange Holdings, Inc.* (a) | | | 14,620 | | | | 126,317 | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 55,590 | | | | 18,974,535 | |
| | |
Block, Inc., Class A* | | | 11,900 | | | | 478,975 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Financial Services – (continued) | |
| | |
Cantaloupe, Inc.* | | | 2,550 | | | $ | 16,779 | |
| | |
Compass Diversified Holdings | | | 3,740 | | | | 64,253 | |
| | |
Enact Holdings, Inc. | | | 3,570 | | | | 98,389 | |
| | |
Equitable Holdings, Inc. | | | 12,750 | | | | 338,768 | |
| | |
Essent Group Ltd.(a) | | | 21,590 | | | | 1,019,912 | |
| | |
Euronet Worldwide, Inc.* | | | 1,870 | | | | 143,691 | |
| | |
EVERTEC, Inc.(a) | | | 5,100 | | | | 162,078 | |
| | |
Federal Agricultural Mortgage Corp., Class C | | | 1,020 | | | | 151,531 | |
| | |
Fidelity National Information Services, Inc. | | | 17,340 | | | | 851,567 | |
| | |
Fiserv, Inc.* | | | 19,040 | | | | 2,165,800 | |
| | |
FleetCor Technologies, Inc.* | | | 1,530 | | | | 344,510 | |
| | |
Flywire Corp.* (a) | | | 5,270 | | | | 141,710 | |
| | |
Global Payments, Inc. | | | 7,310 | | | | 776,468 | |
| | |
International Money Express, Inc.* | | | 2,394 | | | | 38,208 | |
| | |
Jack Henry & Associates, Inc.(a) | | | 1,881 | | | | 265,202 | |
| | |
Jackson Financial, Inc., Class A(a) | | | 13,770 | | | | 505,497 | |
| | |
Marqeta, Inc., Class A* | | | 24,820 | | | | 128,319 | |
| | |
Mastercard, Inc., Class A | | | 20,570 | | | | 7,741,520 | |
| | |
Merchants Bancorp(a) | | | 3,078 | | | | 92,001 | |
| | |
MGIC Investment Corp. | | | 58,480 | | | | 984,803 | |
| | |
Mr Cooper Group, Inc.* | | | 16,320 | | | | 922,570 | |
| | |
NMI Holdings, Inc., Class A* | | | 18,810 | | | | 514,454 | |
| | |
PayPal Holdings, Inc.* | | | 31,960 | | | | 1,655,528 | |
| | |
PennyMac Financial Services, Inc.(a) | | | 7,480 | | | | 502,656 | |
| | |
Radian Group, Inc.(a) | | | 36,908 | | | | 935,249 | |
| | |
Remitly Global, Inc.* (a) | | | 8,840 | | | | 238,061 | |
| | |
Repay Holdings Corp., Class A* (a) | | | 27,370 | | | | 163,946 | |
| | |
Rocket Cos., Inc., Class A* (a) | | | 7,140 | | | | 52,765 | |
| | |
Shift4 Payments, Inc., Class A* (a) | | | 2,040 | | | | 90,821 | |
| | |
Toast, Inc., Class A* (a) | | | 13,600 | | | | 217,464 | |
| | |
Visa, Inc., Class A(a) | | | 39,950 | | | | 9,392,245 | |
| | |
Voya Financial, Inc.(a) | | | 21,930 | | | | 1,464,266 | |
| | |
Walker & Dunlop, Inc.(a) | | | 6,630 | | | | 429,624 | |
See Accompanying Notes to the Financial Statements.
| | | | |
154 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Financial Services – (continued) | |
| | |
Western Union Co. (The) | | | 75,140 | | | $ | 848,331 | |
| | |
WEX, Inc.* | | | 1,530 | | | | 254,714 | |
| | | | | | | 55,317,684 | |
|
Food Products – 0.9% | |
| | |
Archer-Daniels-Midland Co. | | | 17,000 | | | | 1,216,690 | |
| | |
B&G Foods, Inc.(a) | | | 7,650 | | | | 61,736 | |
| | |
Beyond Meat, Inc.* (a) | | | 8,500 | | | | 50,745 | |
| | |
Bunge Ltd. | | | 3,910 | | | | 414,382 | |
| | |
Calavo Growers, Inc. | | | 171 | | | | 4,333 | |
| | |
Cal-Maine Foods, Inc.(a) | | | 7,480 | | | | 338,919 | |
| | |
Campbell Soup Co.(a) | | | 5,985 | | | | 241,854 | |
| | |
Conagra Brands, Inc. | | | 15,048 | | | | 411,713 | |
| | |
Darling Ingredients, Inc.* | | | 4,446 | | | | 196,913 | |
| | |
Flowers Foods, Inc. | | | 11,286 | | | | 247,502 | |
| | |
Freshpet, Inc.* (a) | | | 2,210 | | | | 126,854 | |
| | |
General Mills, Inc. | | | 15,640 | | | | 1,020,354 | |
| | |
Hershey Co. (The) | | | 3,420 | | | | 640,737 | |
| | |
Hormel Foods Corp. | | | 5,440 | | | | 177,072 | |
| | |
Hostess Brands, Inc., Class A* | | | 3,910 | | | | 130,594 | |
| | |
Ingredion, Inc. | | | 13,851 | | | | 1,296,177 | |
| | |
J & J Snack Foods Corp.(a) | | | 1,197 | | | | 187,462 | |
| | |
J M Smucker Co. (The) | | | 3,060 | | | | 348,350 | |
| | |
John B Sanfilippo & Son, Inc. | | | 1,190 | | | | 121,689 | |
| | |
Kellogg Co. | | | 6,120 | | | | 308,876 | |
| | |
Kraft Heinz Co. (The) | | | 22,780 | | | | 716,659 | |
| | |
Lamb Weston Holdings, Inc. | | | 3,591 | | | | 322,472 | |
| | |
Lancaster Colony Corp. | | | 1,190 | | | | 201,312 | |
| | |
McCormick & Co., Inc. (Non-Voting) | | | 5,440 | | | | 347,616 | |
| | |
Mondelez International, Inc., Class A | | | 34,510 | | | | 2,284,907 | |
| | |
Pilgrim’s Pride Corp.* | | | 5,270 | | | | 134,385 | |
| | |
Post Holdings, Inc.* (a) | | | 3,078 | | | | 247,102 | |
| | |
Seaboard Corp.(a) | | | 62 | | | | 217,431 | |
| | |
Simply Good Foods Co. (The)* (a) | | | 2,394 | | | | 89,272 | |
| | |
Tootsie Roll Industries, Inc. | | | 2,455 | | | | 76,376 | |
| | |
TreeHouse Foods, Inc.* | | | 1,020 | | | | 42,524 | |
| | |
Tyson Foods, Inc., Class A | | | 7,140 | | | | 330,939 | |
| | |
Utz Brands, Inc.(a) | | | 7,353 | | | | 89,633 | |
| | | | | | | 12,643,580 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Gas Utilities – 0.2% | |
| | |
Atmos Energy Corp.(a) | | | 3,078 | | | $ | 331,377 | |
| | |
Chesapeake Utilities Corp.(a) | | | 513 | | | | 45,457 | |
| | |
National Fuel Gas Co. | | | 21,590 | | | | 1,100,011 | |
| | |
New Jersey Resources Corp. | | | 5,780 | | | | 234,552 | |
| | |
ONE Gas, Inc.(a) | | | 3,420 | | | | 206,568 | |
| | |
Southwest Gas Holdings, Inc. | | | 2,223 | | | | 130,290 | |
| | |
Spire, Inc.(a) | | | 3,570 | | | | 198,599 | |
| | |
UGI Corp.(a) | | | 49,640 | | | | 1,032,512 | |
| | | | | | | 3,279,366 | |
|
Ground Transportation – 1.0% | |
| | |
ArcBest Corp.(a) | | | 4,788 | | | | 521,317 | |
| | |
Avis Budget Group, Inc.* | | | 1,020 | | | | 166,056 | |
| | |
CSX Corp. | | | 52,139 | | | | 1,556,349 | |
| | |
Heartland Express, Inc.(a) | | | 5,301 | | | | 61,810 | |
| | |
Hertz Global Holdings, Inc.* (a) | | | 23,800 | | | | 200,634 | |
| | |
JB Hunt Transport Services, Inc.(a) | | | 2,052 | | | | 352,677 | |
| | |
Knight-Swift Transportation Holdings, Inc., Class A | | | 4,446 | | | | 217,365 | |
| | |
Landstar System, Inc.(a) | | | 1,710 | | | | 281,774 | |
| | |
Lyft, Inc., Class A* | | | 19,210 | | | | 176,156 | |
| | |
Marten Transport Ltd. | | | 2,565 | | | | 45,093 | |
| | |
Norfolk Southern Corp. | | | 6,460 | | | | 1,232,503 | |
| | |
Old Dominion Freight Line, Inc. | | | 2,394 | | | | 901,724 | |
| | |
RXO, Inc.* | | | 850 | | | | 14,883 | |
| | |
Ryder System, Inc. | | | 9,918 | | | | 967,402 | |
| | |
Saia, Inc.* (a) | | | 1,197 | | | | 429,113 | |
| | |
Schneider National, Inc., Class B(a) | | | 7,140 | | | | 180,856 | |
| | |
Uber Technologies, Inc.* | | | 52,360 | | | | 2,266,141 | |
| | |
U-Haul Holding Co.* (a) | | | 171 | | | | 8,399 | |
| | |
U-Haul Holding Co. | | | 2,040 | | | | 96,308 | |
| | |
Union Pacific Corp. | | | 14,960 | | | | 3,105,846 | |
| | |
Werner Enterprises, Inc. | | | 13,090 | | | | 475,429 | |
| | |
XPO, Inc.* | | | 5,270 | | | | 399,519 | |
| | | | | | | 13,657,354 | |
|
Health Care Equipment & Supplies – 2.0% | |
| | |
Abbott Laboratories | | | 41,990 | | | | 3,970,155 | |
| | |
Align Technology, Inc.* | | | 1,870 | | | | 345,183 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 155 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Alphatec Holdings, Inc.* (a) | | | 171 | | | $ | 1,570 | |
| | |
AtriCure, Inc.* | | | 3,740 | | | | 129,554 | |
| | |
Avanos Medical, Inc.* | | | 1,026 | | | | 18,837 | |
| | |
Axonics, Inc.* (a) | | | 2,736 | | | | 140,111 | |
| | |
Baxter International, Inc. | | | 14,790 | | | | 479,640 | |
| | |
Becton Dickinson & Co. | | | 7,140 | | | | 1,804,849 | |
| | |
Boston Scientific Corp.* | | | 36,380 | | | | 1,862,292 | |
| | |
CONMED Corp.(a) | | | 2,040 | | | | 198,818 | |
| | |
Cooper Cos., Inc. (The) | | | 1,197 | | | | 373,165 | |
| | |
Dentsply Sirona, Inc. | | | 7,480 | | | | 227,467 | |
| | |
Dexcom, Inc.* | | | 9,576 | | | | 850,636 | |
| | |
Edwards Lifesciences Corp.* | | | 15,300 | | | | 974,916 | |
| | |
Enovis Corp.* (a) | | | 3,740 | | | | 171,682 | |
| | |
Envista Holdings Corp.* (a) | | | 8,840 | | | | 205,707 | |
| | |
Establishment Labs Holdings, Inc.* (a) | | | 1,368 | | | | 40,055 | |
| | |
GE HealthCare Technologies, Inc.(a) | | | 9,690 | | | | 645,063 | |
| | |
Glaukos Corp.* (a) | | | 2,394 | | | | 163,271 | |
| | |
Globus Medical, Inc., Class A* (a) | | | 3,751 | | | | 171,458 | |
| | |
Haemonetics Corp.* | | | 2,736 | | | | 233,189 | |
| | |
Hologic, Inc.* | | | 6,970 | | | | 461,205 | |
| | |
ICU Medical, Inc.* (a) | | | 510 | | | | 50,011 | |
| | |
IDEXX Laboratories, Inc.* | | | 2,040 | | | | 814,919 | |
| | |
Inari Medical, Inc.* (a) | | | 3,230 | | | | 196,093 | |
| | |
Inspire Medical Systems, Inc.* | | | 1,368 | | | | 201,315 | |
| | |
Insulet Corp.* | | | 1,539 | | | | 204,025 | |
| | |
Integer Holdings Corp.* (a) | | | 855 | | | | 69,400 | |
| | |
Integra LifeSciences Holdings Corp.* (a) | | | 1,530 | | | | 55,019 | |
| | |
Intuitive Surgical, Inc.* | | | 8,840 | | | | 2,318,025 | |
| | |
iRhythm Technologies, Inc.* (a) | | | 1,870 | | | | 146,832 | |
| | |
Lantheus Holdings, Inc.* | | | 4,167 | | | | 269,188 | |
| | |
LeMaitre Vascular, Inc. | | | 171 | | | | 8,307 | |
| | |
LivaNova plc* | | | 2,040 | | | | 100,062 | |
| | |
Masimo Corp.* (a) | | | 1,700 | | | | 137,921 | |
| | |
Medtronic plc | | | 39,270 | | | | 2,770,891 | |
| | |
Merit Medical Systems, Inc.* | | | 1,700 | | | | 116,858 | |
| | |
Neogen Corp.* (a) | | | 12,070 | | | | 179,722 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Novocure Ltd.* (a) | | | 2,394 | | | $ | 31,840 | |
| | |
Omnicell, Inc.* | | | 2,210 | | | | 78,543 | |
| | |
OrthoPediatrics Corp.* (a) | | | 2,550 | | | | 62,373 | |
| | |
Penumbra, Inc.* (a) | | | 1,190 | | | | 227,469 | |
| | |
PROCEPT BioRobotics Corp.* (a) | | | 1,710 | | | | 45,811 | |
| | |
Pulmonx Corp.* (a) | | | 7,480 | | | | 65,749 | |
| | |
QuidelOrtho Corp.* | | | 1,360 | | | | 83,069 | |
| | |
ResMed, Inc. | | | 3,420 | | | | 482,972 | |
| | |
Shockwave Medical, Inc.* | | | 1,190 | | | | 245,449 | |
| | |
STAAR Surgical Co.* | | | 510 | | | | 21,328 | |
| | |
STERIS plc(a) | | | 2,736 | | | | 574,505 | |
| | |
Stryker Corp. | | | 8,330 | | | | 2,250,933 | |
| | |
Tandem Diabetes Care, Inc.* (a) | | | 5,950 | | | | 102,935 | |
| | |
Teleflex, Inc.(a) | | | 850 | | | | 157,038 | |
| | |
TransMedics Group, Inc.* (a) | | | 1,368 | | | | 51,273 | |
| | |
Treace Medical Concepts, Inc.* | | | 2,394 | | | | 24,012 | |
| | |
Zimmer Biomet Holdings, Inc. | | | 5,643 | | | | 589,186 | |
| | | | | | | 26,201,896 | |
|
Health Care Providers & Services – 2.9% | |
| | |
Acadia Healthcare Co., Inc.* | | | 3,060 | | | | 224,941 | |
| | |
Accolade, Inc.* | | | 9,350 | | | | 60,775 | |
| | |
AdaptHealth Corp., Class A* (a) | | | 23,290 | | | | 170,716 | |
| | |
Addus HomeCare Corp.* (a) | | | 1,020 | | | | 80,478 | |
| | |
Agiliti, Inc.* (a) | | | 342 | | | | 1,925 | |
| | |
agilon health, Inc.* (a) | | | 4,420 | | | | 79,560 | |
| | |
Amedisys, Inc.* | | | 1,700 | | | | 155,533 | |
| | |
AMN Healthcare Services, Inc.* (a) | | | 9,234 | | | | 700,491 | |
| | |
Apollo Medical Holdings, Inc.* (a) | | | 2,720 | | | | 84,891 | |
| | |
Brookdale Senior Living, Inc.* (a) | | | 49,745 | | | | 194,503 | |
| | |
Cardinal Health, Inc. | | | 8,670 | | | | 788,970 | |
| | |
Cencora, Inc.(a) | | | 4,959 | | | | 918,159 | |
| | |
Centene Corp.* | | | 17,680 | | | | 1,219,566 | |
| | |
Chemed Corp.(a) | | | 342 | | | | 192,426 | |
| | |
Cigna Group (The) | | | 9,350 | | | | 2,891,020 | |
See Accompanying Notes to the Financial Statements.
| | | | |
156 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Providers & Services – (continued) | |
| | |
Community Health Systems, Inc.* (a) | | | 24,795 | | | $ | 53,061 | |
| | |
Cross Country Healthcare, Inc.* | | | 7,353 | | | | 170,296 | |
| | |
CVS Health Corp. | | | 38,760 | | | | 2,674,828 | |
| | |
DaVita, Inc.* (a) | | | 2,380 | | | | 183,807 | |
| | |
Elevance Health, Inc. | | | 7,353 | | | | 3,309,512 | |
| | |
Encompass Health Corp. | | | 3,570 | | | | 223,339 | |
| | |
Ensign Group, Inc. (The)(a) | | | 1,870 | | | | 180,642 | |
| | |
Guardant Health, Inc.* | | | 6,120 | | | | 158,386 | |
| | |
HCA Healthcare, Inc. | | | 5,950 | | | | 1,345,533 | |
| | |
HealthEquity, Inc.* (a) | | | 3,762 | | | | 269,660 | |
| | |
Henry Schein, Inc.* | | | 4,275 | | | | 277,790 | |
| | |
Humana, Inc. | | | 3,740 | | | | 1,958,601 | |
| | |
Laboratory Corp. of America Holdings | | | 2,907 | | | | 580,615 | |
| | |
McKesson Corp. | | | 4,250 | | | | 1,935,280 | |
| | |
ModivCare, Inc.* (a) | | | 170 | | | | 7,181 | |
| | |
Molina Healthcare, Inc.* | | | 1,530 | | | | 509,414 | |
| | |
National Research Corp.(a) | | | 2,223 | | | | 93,944 | |
| | |
NeoGenomics, Inc.* (a) | | | 3,249 | | | | 45,551 | |
| | |
OPKO Health, Inc.* (a) | | | 134,980 | | | | 168,725 | |
| | |
Option Care Health, Inc.* | | | 9,234 | | | | 256,059 | |
| | |
Owens & Minor, Inc.* (a) | | | 12,580 | | | | 180,271 | |
| | |
Patterson Cos., Inc. | | | 18,639 | | | | 567,744 | |
| | |
Pediatrix Medical Group, Inc.* (a) | | | 23,800 | | | | 272,748 | |
| | |
Premier, Inc., Class A(a) | | | 22,270 | | | | 428,029 | |
| | |
Privia Health Group, Inc.* (a) | | | 5,440 | | | | 114,349 | |
| | |
Progyny, Inc.* | | | 3,570 | | | | 110,170 | |
| | |
Quest Diagnostics, Inc. | | | 3,400 | | | | 442,340 | |
| | |
R1 RCM, Inc.* (a) | | | 3,933 | | | | 46,370 | |
| | |
RadNet, Inc.* | | | 1,026 | | | | 27,661 | |
| | |
Select Medical Holdings Corp.(a) | | | 4,080 | | | | 92,738 | |
| | |
Surgery Partners, Inc.* | | | 3,249 | | | | 75,149 | |
| | |
Tenet Healthcare Corp.* (a) | | | 23,290 | | | | 1,250,673 | |
| | |
UnitedHealth Group, Inc. | | | 22,780 | | | | 12,200,057 | |
| | |
Universal Health Services, Inc., Class B | | | 1,870 | | | | 235,414 | |
| | |
US Physical Therapy, Inc. | | | 171 | | | | 14,383 | |
| | | | | | | 38,224,274 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care REITs – 0.2% | |
| | |
CareTrust REIT, Inc., REIT | | | 7,182 | | | $ | 154,557 | |
| | |
Community Healthcare Trust, Inc., REIT(a) | | | 3,230 | | | | 92,604 | |
| | |
Healthcare Realty Trust, Inc., Class A, REIT(a) | | | 13,770 | | | | 197,600 | |
| | |
Healthpeak Properties, Inc., REIT | | | 17,850 | | | | 277,567 | |
| | |
Medical Properties Trust, Inc., REIT(a) | | | 117,640 | | | | 562,319 | |
| | |
National Health Investors, Inc., REIT | | | 680 | | | | 34,027 | |
| | |
Omega Healthcare Investors, Inc., REIT(a) | | | 8,500 | | | | 281,350 | |
| | |
Physicians Realty Trust, REIT(a) | | | 16,490 | | | | 179,081 | |
| | |
Sabra Health Care REIT, Inc., REIT | | | 11,220 | | | | 153,041 | |
| | |
Ventas, Inc., REIT | | | 9,520 | | | | 404,219 | |
| | |
Welltower, Inc., REIT | | | 12,070 | | | | 1,009,173 | |
| | | | | | | 3,345,538 | |
|
Health Care Technology – 0.1% | |
| | |
Doximity, Inc., Class A* (a) | | | 7,310 | | | | 149,343 | |
| | |
Evolent Health, Inc., Class A* (a) | | | 5,780 | | | | 141,205 | |
| | |
Health Catalyst, Inc.* | | | 10,200 | | | | 76,398 | |
| | |
HealthStream, Inc. | | | 171 | | | | 4,344 | |
| | |
Multiplan Corp.* (a) | | | 63,070 | | | | 106,588 | |
| | |
NextGen Healthcare, Inc.* | | | 513 | | | | 12,271 | |
| | |
Phreesia, Inc.* (a) | | | 4,590 | | | | 62,699 | |
| | |
Teladoc Health, Inc.* (a) | | | 3,570 | | | | 59,048 | |
| | |
Veeva Systems, Inc., Class A* | | | 3,570 | | | | 687,975 | |
| | |
Veradigm, Inc.* (a) | | | 9,442 | | | | 124,540 | |
| | | | | | | 1,424,411 | |
|
Hotel & Resort REITs – 0.2% | |
| | |
Apple Hospitality REIT, Inc., REIT(a) | | | 6,290 | | | | 98,627 | |
| | |
Chatham Lodging Trust, REIT | | | 7,011 | | | | 64,852 | |
| | |
DiamondRock Hospitality Co., REIT(a) | | | 17,606 | | | | 136,094 | |
| | |
Host Hotels & Resorts, Inc., REIT | | | 16,245 | | | | 251,473 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 157 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Hotel & Resort REITs – (continued) | |
| | |
Park Hotels & Resorts, Inc., REIT(a) | | | 15,597 | | | $ | 179,833 | |
| | |
Pebblebrook Hotel Trust, REIT(a) | | | 31,620 | | | | 377,227 | |
| | |
RLJ Lodging Trust, REIT | | | 15,470 | | | | 145,418 | |
| | |
Ryman Hospitality Properties, Inc., REIT(a) | | | 3,249 | | | | 278,114 | |
| | |
Service Properties Trust, REIT | | | 37,740 | | | | 273,615 | |
| | |
Summit Hotel Properties, Inc., REIT(a) | | | 38,930 | | | | 219,565 | |
| | |
Sunstone Hotel Investors, Inc., REIT(a) | | | 8,550 | | | | 79,515 | |
| | |
Xenia Hotels & Resorts, Inc., REIT(a) | | | 9,601 | | | | 111,660 | |
| | | | | | | 2,215,993 | |
|
Hotels, Restaurants & Leisure – 2.0% | |
| | |
Airbnb, Inc., Class A* | | | 10,030 | | | | 1,186,449 | |
| | |
Aramark | | | 5,814 | | | | 156,571 | |
| | |
Bally’s Corp.* (a) | | | 6,120 | | | | 55,814 | |
| | |
BJ’s Restaurants, Inc.* | | | 2,052 | | | | 52,778 | |
| | |
Bloomin’ Brands, Inc.(a) | | | 17,271 | | | | 403,105 | |
| | |
Booking Holdings, Inc.* | | | 850 | | | | 2,371,126 | |
| | |
Boyd Gaming Corp. | | | 3,933 | | | | 217,298 | |
| | |
Brinker International, Inc.* (a) | | | 7,650 | | | | 259,488 | |
| | |
Caesars Entertainment, Inc.* | | | 6,970 | | | | 278,033 | |
| | |
Carnival Corp.* (a) | | | 25,330 | | | | 290,282 | |
| | |
Cheesecake Factory, Inc. (The)(a) | | | 3,060 | | | | 95,074 | |
| | |
Chipotle Mexican Grill, Inc., Class A* | | | 684 | | | | 1,328,465 | |
| | |
Choice Hotels International, Inc. | | | 1,026 | | | | 113,373 | |
| | |
Churchill Downs, Inc.(a) | | | 1,710 | | | | 187,826 | |
| | |
Cracker Barrel Old Country Store, Inc.(a) | | | 1,020 | | | | 67,687 | |
| | |
Darden Restaurants, Inc. | | | 2,736 | | | | 398,170 | |
| | |
Dave & Buster’s Entertainment, Inc.* (a) | | | 3,740 | | | | 130,676 | |
| | |
Denny’s Corp.* (a) | | | 1,539 | | | | 13,266 | |
| | |
Dine Brands Global, Inc. | | | 3,570 | | | | 175,965 | |
| | |
Domino’s Pizza, Inc. | | | 680 | | | | 230,513 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
DoorDash, Inc., Class A* (a) | | | 6,460 | | | $ | 484,177 | |
| | |
DraftKings, Inc., Class A* | | | 14,110 | | | | 389,718 | |
| | |
Dutch Bros, Inc., Class A* | | | 2,720 | | | | 66,205 | |
| | |
Everi Holdings, Inc.* | | | 7,695 | | | | 83,029 | |
| | |
Expedia Group, Inc.* | | | 3,910 | | | | 372,584 | |
| | |
Hilton Grand Vacations, Inc.* (a) | | | 17,955 | | | | 645,482 | |
| | |
Hilton Worldwide Holdings, Inc. | | | 6,327 | | | | 958,730 | |
| | |
Hyatt Hotels Corp., Class A(a) | | | 2,890 | | | | 296,052 | |
| | |
Jack in the Box, Inc.(a) | | | 342 | | | | 21,608 | |
| | |
Las Vegas Sands Corp. | | | 7,140 | | | | 338,864 | |
| | |
Life Time Group Holdings, Inc.* | | | 7,480 | | | | 88,414 | |
| | |
Light & Wonder, Inc.* (a) | | | 5,270 | | | | 385,290 | |
| | |
Lindblad Expeditions Holdings, Inc.* | | | 8,500 | | | | 52,870 | |
| | |
Marriott International, Inc., Class A | | | 6,630 | | | | 1,250,153 | |
| | |
Marriott Vacations Worldwide Corp. | | | 2,210 | | | | 198,591 | |
| | |
McDonald’s Corp. | | | 18,126 | | | | 4,752,094 | |
| | |
MGM Resorts International(a) | | | 9,010 | | | | 314,629 | |
| | |
Norwegian Cruise Line Holdings Ltd.* (a) | | | 14,110 | | | | 191,896 | |
| | |
Papa John’s International, Inc.(a) | | | 510 | | | | 33,160 | |
| | |
Penn Entertainment, Inc.* (a) | | | 29,920 | | | | 590,322 | |
| | |
Planet Fitness, Inc., Class A* | | | 3,910 | | | | 216,106 | |
| | |
Red Rock Resorts, Inc., Class A(a) | | | 2,052 | | | | 81,157 | |
| | |
Royal Caribbean Cruises Ltd.* (a) | | | 6,970 | | | | 590,568 | |
| | |
Sabre Corp.* | | | 57,460 | | | | 201,110 | |
| | |
SeaWorld Entertainment, Inc.* | | | 3,230 | | | | 139,148 | |
| | |
Shake Shack, Inc., Class A* | | | 680 | | | | 38,107 | |
| | |
Six Flags Entertainment Corp.* | | | 18,530 | | | | 368,747 | |
| | |
Starbucks Corp. | | | 27,370 | | | | 2,524,609 | |
| | |
Sweetgreen, Inc., Class A* (a) | | | 9,180 | | | | 94,829 | |
See Accompanying Notes to the Financial Statements.
| | | | |
158 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
Texas Roadhouse, Inc., Class A | | | 3,910 | | | $ | 397,021 | |
| | |
Travel + Leisure Co. | | | 15,810 | | | | 538,014 | |
| | |
Vail Resorts, Inc.(a) | | | 1,026 | | | | 217,769 | |
| | |
Wendy’s Co. (The)(a) | | | 11,220 | | | | 213,404 | |
| | |
Wingstop, Inc. | | | 1,881 | | | | 343,790 | |
| | |
Wyndham Hotels & Resorts, Inc. | | | 3,249 | | | | 235,228 | |
| | |
Wynn Resorts Ltd.(a) | | | 3,060 | | | | 268,607 | |
| | |
Yum! Brands, Inc. | | | 7,480 | | | | 904,033 | |
| | | | | | | 26,898,074 | |
|
Household Durables – 1.1% | |
| | |
Beazer Homes USA, Inc.* (a) | | | 3,400 | | | | 82,246 | |
| | |
Cavco Industries, Inc.* (a) | | | 1,530 | | | | 381,750 | |
| | |
Century Communities, Inc. | | | 7,182 | | | | 441,693 | |
| | |
Cricut, Inc., Class A(a) | | | 684 | | | | 5,835 | |
| | |
DR Horton, Inc. | | | 9,747 | | | | 1,017,587 | |
| | |
Dream Finders Homes, Inc., Class A* (a) | | | 1,700 | | | | 33,473 | |
| | |
Ethan Allen Interiors, Inc.(a) | | | 4,275 | | | | 112,261 | |
| | |
Garmin Ltd. | | | 4,104 | | | | 420,783 | |
| | |
GoPro, Inc., Class A* (a) | | | 12,750 | | | | 32,003 | |
| | |
Green Brick Partners, Inc.* (a) | | | 7,650 | | | | 296,055 | |
| | |
Helen of Troy Ltd.* (a) | | | 4,930 | | | | 484,718 | |
| | |
Hovnanian Enterprises, Inc., Class A* | | | 340 | | | | 23,623 | |
| | |
Installed Building Products, Inc. | | | 684 | | | | 76,382 | |
| | |
iRobot Corp.* | | | 1,368 | | | | 45,048 | |
| | |
KB Home | | | 18,700 | | | | 826,540 | |
| | |
La-Z-Boy, Inc.(a) | | | 7,866 | | | | 230,002 | |
| | |
Leggett & Platt, Inc. | | | 2,720 | | | | 63,730 | |
| | |
Lennar Corp., Class A | | | 8,160 | | | | 870,509 | |
| | |
Lennar Corp., Class B(a) | | | 513 | | | | 50,587 | |
| | |
LGI Homes, Inc.* (a) | | | 4,959 | | | | 468,675 | |
| | |
M/I Homes, Inc.* (a) | | | 7,182 | | | | 589,427 | |
| | |
MDC Holdings, Inc.(a) | | | 12,312 | | | | 467,240 | |
| | |
Meritage Homes Corp. | | | 8,208 | | | | 935,876 | |
| | |
Mohawk Industries, Inc.* | | | 12,410 | | | | 997,516 | |
| | |
Newell Brands, Inc. | | | 74,630 | | | | 501,514 | |
| | |
NVR, Inc.* | | | 104 | | | | 562,912 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Household Durables – (continued) | |
| | |
PulteGroup, Inc. | | | 7,820 | | | $ | 575,474 | |
| | |
Skyline Champion Corp.* | | | 3,570 | | | | 209,309 | |
| | |
Sonos, Inc.* | | | 6,630 | | | | 71,471 | |
| | |
Taylor Morrison Home Corp., Class A* (a) | | | 24,820 | | | | 951,102 | |
| | |
Tempur Sealy International, Inc.(a) | | | 9,690 | | | | 386,922 | |
| | |
Toll Brothers, Inc.(a) | | | 22,780 | | | | 1,610,774 | |
| | |
TopBuild Corp.* | | | 1,190 | | | | 272,224 | |
| | |
Tri Pointe Homes, Inc.* | | | 24,140 | | | | 604,948 | |
| | |
Vizio Holding Corp., Class A* | | | 10,540 | | | | 53,649 | |
| | |
Whirlpool Corp.(a) | | | 2,052 | | | | 214,557 | |
| | | | | | | 14,968,415 | |
|
Household Products – 1.0% | |
| | |
Central Garden & Pet Co.* (a) | | | 1,539 | | | | 67,147 | |
| | |
Central Garden & Pet Co., Class A* | | | 4,080 | | | | 161,935 | |
| | |
Church & Dwight Co., Inc. | | | 6,630 | | | | 602,932 | |
| | |
Clorox Co. (The) | | | 3,230 | | | | 380,171 | |
| | |
Colgate-Palmolive Co. | | | 20,060 | | | | 1,506,907 | |
| | |
Energizer Holdings, Inc.(a) | | | 11,730 | | | | 370,433 | |
| | |
Kimberly-Clark Corp. | | | 7,990 | | | | 955,924 | |
| | |
Procter & Gamble Co. (The) | | | 58,650 | | | | 8,799,260 | |
| | |
Reynolds Consumer Products, Inc.(a) | | | 340 | | | | 8,646 | |
| | |
Spectrum Brands Holdings, Inc. | | | 2,720 | | | | 204,870 | |
| | |
WD-40 Co.(a) | | | 340 | | | | 71,876 | |
| | | | | | | 13,130,101 | |
|
Independent Power and Renewable Electricity Producers – 0.1% | |
| | |
AES Corp. (The)(a) | | | 20,910 | | | | 311,559 | |
| | |
Clearway Energy, Inc., Class A | | | 510 | | | | 10,389 | |
| | |
Clearway Energy, Inc., Class C(a) | | | 1,360 | | | | 29,525 | |
| | |
Ormat Technologies, Inc.(a) | | | 1,530 | | | | 94,156 | |
| | |
Vistra Corp. | | | 13,090 | | | | 428,305 | |
| | | | | | | 873,934 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 159 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – 0.5% | |
| | |
3M Co. | | | 15,810 | | | $ | 1,437,919 | |
| | |
General Electric Co. | | | 26,520 | | | | 2,880,868 | |
| | |
Honeywell International, Inc. | | | 15,810 | | | | 2,897,341 | |
| | | | | | | 7,216,128 | |
|
Industrial REITs – 0.3% | |
| | |
Americold Realty Trust, Inc., REIT | | | 5,610 | | | | 147,094 | |
| | |
EastGroup Properties, Inc., REIT | | | 1,469 | | | | 239,814 | |
| | |
First Industrial Realty Trust, Inc., REIT | | | 7,182 | | | | 303,799 | |
| | |
Innovative Industrial Properties, Inc., REIT | | | 340 | | | | 24,422 | |
| | |
LXP Industrial Trust, REIT | | | 5,780 | | | | 45,720 | |
| | |
Plymouth Industrial REIT, Inc., REIT(a) | | | 5,440 | | | | 108,474 | |
| | |
Prologis, Inc., REIT | | | 22,928 | | | | 2,309,996 | |
| | |
Rexford Industrial Realty, Inc., REIT(a) | | | 4,617 | | | | 199,639 | |
| | |
STAG Industrial, Inc., REIT(a) | | | 10,200 | | | | 338,844 | |
| | |
Terreno Realty Corp., REIT | | | 3,933 | | | | 209,550 | |
| | | | | | | 3,927,352 | |
|
Insurance – 2.8% | |
| | |
Aflac, Inc. | | | 17,510 | | | | 1,367,706 | |
| | |
Allstate Corp. (The) | | | 7,140 | | | | 914,848 | |
| | |
Ambac Financial Group, Inc.* | | | 6,630 | | | | 80,422 | |
| | |
American Equity Investment Life Holding Co.(a) | | | 15,130 | | | | 801,285 | |
| | |
American Financial Group, Inc.(a) | | | 2,565 | | | | 280,508 | |
| | |
American International Group, Inc. | | | 22,950 | | | | 1,407,065 | |
| | |
AMERISAFE, Inc. | | | 342 | | | | 17,432 | |
| | |
Aon plc, Class A | | | 5,130 | | | | 1,587,222 | |
| | |
Arch Capital Group Ltd.* | | | 12,410 | | | | 1,075,699 | |
| | |
Argo Group International Holdings Ltd.(a) | | | 8,330 | | | | 248,567 | |
| | |
Arthur J Gallagher & Co. | | | 4,930 | | | | 1,160,966 | |
| | |
Assurant, Inc. | | | 11,560 | | | | 1,721,284 | |
| | |
Assured Guaranty Ltd. | | | 3,910 | | | | 243,984 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Insurance – (continued) | |
| | |
Axis Capital Holdings Ltd. | | | 15,390 | | | $ | 878,769 | |
| | |
Brighthouse Financial, Inc.* | | | 15,980 | | | | 723,894 | |
| | |
Brown & Brown, Inc. | | | 5,643 | | | | 391,737 | |
| | |
BRP Group, Inc., Class A* (a) | | | 1,539 | | | | 32,211 | |
| | |
Chubb Ltd. | | | 12,920 | | | | 2,772,890 | |
| | |
Cincinnati Financial Corp. | | | 3,762 | | | | 374,959 | |
| | |
CNO Financial Group, Inc. | | | 27,374 | | | | 634,529 | |
| | |
Employers Holdings, Inc. | | | 684 | | | | 25,992 | |
| | |
Enstar Group Ltd.* | | | 2,720 | | | | 644,558 | |
| | |
Erie Indemnity Co., Class A(a) | | | 340 | | | | 93,905 | |
| | |
Everest Group Ltd. | | | 1,026 | | | | 405,906 | |
| | |
F&G Annuities & Life, Inc.(a) | | | 680 | | | | 20,869 | |
| | |
Fidelity National Financial, Inc. | | | 9,918 | | | | 387,695 | |
| | |
First American Financial Corp. | | | 21,717 | | | | 1,117,122 | |
| | |
Genworth Financial, Inc., Class A* (a) | | | 85,850 | | | | 514,242 | |
| | |
Globe Life, Inc. | | | 2,394 | | | | 278,566 | |
| | |
Goosehead Insurance, Inc., Class A* (a) | | | 2,210 | | | | 143,363 | |
| | |
Hanover Insurance Group, Inc. (The) | | | 2,040 | | | | 239,108 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | 10,540 | | | | 774,163 | |
| | |
Horace Mann Educators Corp. | | | 510 | | | | 16,182 | |
| | |
Kemper Corp.(a) | | | 4,420 | | | | 176,270 | |
| | |
Kinsale Capital Group, Inc.(a) | | | 680 | | | | 227,059 | |
| | |
Lincoln National Corp. | | | 37,060 | | | | 806,796 | |
| | |
Loews Corp. | | | 6,970 | | | | 446,150 | |
| | |
Markel Group, Inc.* | | | 422 | | | | 620,559 | |
| | |
Marsh & McLennan Cos., Inc. | | | 12,580 | | | | 2,385,797 | |
| | |
MBIA, Inc.* (a) | | | 5,985 | | | | 41,177 | |
| | |
Mercury General Corp.(a) | | | 8,330 | | | | 257,230 | |
| | |
MetLife, Inc. | | | 20,400 | | | | 1,224,204 | |
| | |
National Western Life Group, Inc., Class A | | | 342 | | | | 163,784 | |
| | |
Old Republic International Corp. | | | 11,050 | | | | 302,549 | |
| | |
Oscar Health, Inc., Class A* | | | 27,370 | | | | 140,134 | |
See Accompanying Notes to the Financial Statements.
| | | | |
160 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Primerica, Inc. | | | 1,360 | | | $ | 259,978 | |
| | |
Principal Financial Group, Inc.(a) | | | 7,820 | | | | 529,258 | |
| | |
ProAssurance Corp.(a) | | | 1,539 | | | | 26,163 | |
| | |
Progressive Corp. (The) | | | 14,790 | | | | 2,338,151 | |
| | |
Prudential Financial, Inc. | | | 11,286 | | | | 1,031,992 | |
| | |
Reinsurance Group of America, Inc.(a) | | | 1,530 | | | | 228,689 | |
| | |
RenaissanceRe Holdings Ltd. | | | 2,040 | | | | 447,964 | |
| | |
RLI Corp. | | | 1,360 | | | | 181,206 | |
| | |
Ryan Specialty Holdings, Inc., Class A* (a) | | | 2,550 | | | | 110,160 | |
| | |
Safety Insurance Group, Inc. | | | 170 | | | | 12,779 | |
| | |
Selective Insurance Group, Inc. | | | 3,570 | | | | 371,673 | |
| | |
SiriusPoint Ltd.* (a) | | | 13,851 | | | | 136,432 | |
| | |
Stewart Information Services Corp. | | | 6,327 | | | | 276,300 | |
| | |
Travelers Cos., Inc. (The) | | | 7,480 | | | | 1,252,451 | |
| | |
Trupanion, Inc.* (a) | | | 510 | | | | 10,506 | |
| | |
Universal Insurance Holdings, Inc.(a) | | | 5,440 | | | | 85,190 | |
| | |
Unum Group | | | 5,780 | | | | 282,642 | |
| | |
W R Berkley Corp. | | | 4,617 | | | | 311,278 | |
| | |
White Mountains Insurance Group Ltd.(a) | | | 170 | | | | 243,228 | |
| | |
Willis Towers Watson plc | | | 2,736 | | | | 645,395 | |
| | | | | | | 36,950,792 | |
|
Interactive Media & Services – 4.0% | |
| | |
Alphabet, Inc., Class A* | | | 147,390 | | | | 18,288,151 | |
| | |
Alphabet, Inc., Class C* | | | 124,950 | | | | 15,656,235 | |
| | |
Bumble, Inc., Class A* (a) | | | 7,990 | | | | 107,385 | |
| | |
Cargurus, Inc., Class A* | | | 3,910 | | | | 67,369 | |
| | |
Cars.com, Inc.* | | | 6,630 | | | | 100,975 | |
| | |
IAC, Inc.* | | | 15,300 | | | | 651,015 | |
| | |
Match Group, Inc.* | | | 5,270 | | | | 182,342 | |
| | |
Meta Platforms, Inc., Class A* | | | 54,910 | | | | 16,542,736 | |
| | |
Pinterest, Inc., Class A* | | | 13,940 | | | | 416,527 | |
| | |
QuinStreet, Inc.* | | | 1,539 | | | | 17,406 | |
| | |
Shutterstock, Inc.(a) | | | 1,360 | | | | 55,325 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Interactive Media & Services – (continued) | |
| | |
Snap, Inc., Class A* (a) | | | 25,330 | | | $ | 253,553 | |
| | |
Taboola.com Ltd.* (a) | | | 39,440 | | | | 144,745 | |
| | |
TripAdvisor, Inc.* (a) | | | 5,643 | | | | 83,291 | |
| | |
Vimeo, Inc.* | | | 54,400 | | | | 167,552 | |
| | |
Yelp, Inc., Class A* | | | 4,590 | | | | 193,652 | |
| | |
Ziff Davis, Inc.* | | | 680 | | | | 41,113 | |
| | |
ZipRecruiter, Inc., Class A* | | | 7,140 | | | | 76,041 | |
| | |
ZoomInfo Technologies, Inc., Class A* | | | 7,480 | | | | 96,941 | |
| | | | | | | 53,142,354 | |
|
IT Services – 1.2% | |
| | |
Accenture plc, Class A | | | 15,810 | | | | 4,696,993 | |
| | |
Akamai Technologies, Inc.* | | | 3,420 | | | | 353,389 | |
| | |
Cloudflare, Inc., Class A* | | | 6,156 | | | | 348,984 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 16,150 | | | | 1,041,190 | |
| | |
DigitalOcean Holdings, Inc.* (a) | | | 2,380 | | | | 48,695 | |
| | |
DXC Technology Co.* (a) | | | 47,600 | | | | 960,092 | |
| | |
EPAM Systems, Inc.* | | | 1,530 | | | | 332,882 | |
| | |
Fastly, Inc., Class A* (a) | | | 4,760 | | | | 69,829 | |
| | |
Gartner, Inc.* | | | 2,040 | | | | 677,362 | |
| | |
GoDaddy, Inc., Class A* (a) | | | 3,933 | | | | 288,014 | |
| | |
International Business Machines Corp.(a) | | | 27,030 | | | | 3,909,619 | |
| | |
Kyndryl Holdings, Inc.* (a) | | | 48,280 | | | | 706,336 | |
| | |
MongoDB, Inc., Class A* | | | 1,539 | | | | 530,324 | |
| | |
Okta, Inc., Class A* | | | 3,249 | | | | 219,015 | |
| | |
Perficient, Inc.* (a) | | | 2,380 | | | | 138,492 | |
| | |
Snowflake, Inc., Class A* | | | 8,500 | | | | 1,233,605 | |
| | |
Squarespace, Inc., Class A* | | | 1,710 | | | | 48,581 | |
| | |
Twilio, Inc., Class A* (a) | | | 4,420 | | | | 226,569 | |
| | |
VeriSign, Inc.* | | | 2,394 | | | | 477,986 | |
| | | | | | | 16,307,957 | |
|
Leisure Products – 0.3% | |
| | |
Acushnet Holdings Corp.(a) | | | 1,026 | | | | 52,285 | |
| | |
Brunswick Corp.(a) | | | 15,903 | | | | 1,104,781 | |
| | |
Funko, Inc., Class A* (a) | | | 7,820 | | | | 60,292 | |
| | |
Hasbro, Inc.(a) | | | 4,760 | | | | 214,914 | |
| | |
Malibu Boats, Inc., Class A* (a) | | | 3,762 | | | | 164,099 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 161 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Leisure Products – (continued) | |
| | |
MasterCraft Boat Holdings, Inc.* | | | 2,890 | | | $ | 59,072 | |
| | |
Mattel, Inc.* | | | 15,980 | | | | 304,898 | |
| | |
Peloton Interactive, Inc., Class A* (a) | | | 19,550 | | | | 93,058 | |
| | |
Polaris, Inc.(a) | | | 11,050 | | | | 954,941 | |
| | |
Smith & Wesson Brands, Inc. | | | 7,695 | | | | 113,347 | |
| | |
Sturm Ruger & Co., Inc. | | | 1,360 | | | | 75,276 | |
| | |
Topgolf Callaway Brands Corp.* (a) | | | 8,330 | | | | 101,793 | |
| | |
Vista Outdoor, Inc.* (a) | | | 10,944 | | | | 274,913 | |
| | |
YETI Holdings, Inc.* (a) | | | 2,040 | | | | 86,741 | |
| | | | | | | 3,660,410 | |
|
Life Sciences Tools & Services – 1.0% | |
| | |
10X Genomics, Inc., Class A* | | | 4,760 | | | | 167,933 | |
| | |
Agilent Technologies, Inc. | | | 6,630 | | | | 685,343 | |
| | |
Avantor, Inc.* | | | 19,890 | | | | 346,683 | |
| | |
Azenta, Inc.* (a) | | | 4,420 | | | | 200,889 | |
| | |
Bio-Rad Laboratories, Inc., Class A* | | | 510 | | | | 140,393 | |
| | |
Bio-Techne Corp. | | | 3,060 | | | | 167,168 | |
| | |
Bruker Corp. | | | 2,394 | | | | 136,458 | |
| | |
Charles River Laboratories International, Inc.* (a) | | | 1,700 | | | | 286,212 | |
| | |
CryoPort, Inc.* (a) | | | 1,539 | | | | 14,928 | |
| | |
Danaher Corp. | | | 15,980 | | | | 3,068,480 | |
| | |
Illumina, Inc.* | | | 3,400 | | | | 372,028 | |
| | |
IQVIA Holdings, Inc.* | | | 4,930 | | | | 891,492 | |
| | |
Maravai LifeSciences Holdings, Inc., Class A* | | | 10,880 | | | | 74,637 | |
| | |
Medpace Holdings, Inc.* | | | 1,026 | | | | 248,979 | |
| | |
Mesa Laboratories, Inc.(a) | | | 850 | | | | 79,755 | |
| | |
Mettler-Toledo International, Inc.* | | | 513 | | | | 505,408 | |
| | |
OmniAb, Inc.* ‡ (a) | | | 281 | | | | 90 | |
| | |
Pacific Biosciences of California, Inc.* (a) | | | 8,500 | | | | 52,530 | |
| | |
Repligen Corp.* (a) | | | 1,368 | | | | 184,078 | |
| | |
Revvity, Inc. | | | 3,910 | | | | 323,943 | |
| | |
Sotera Health Co.* (a) | | | 10,200 | | | | 129,132 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Life Sciences Tools & Services – (continued) | |
| | |
Thermo Fisher Scientific, Inc. | | | 9,520 | | | $ | 4,234,210 | |
| | |
Waters Corp.* (a) | | | 1,539 | | | | 367,098 | |
| | |
West Pharmaceutical Services, Inc. | | | 2,040 | | | | 649,312 | |
| | | | | | | 13,327,179 | |
|
Machinery – 2.0% | |
| | |
3D Systems Corp.* (a) | | | 11,220 | | | | 41,851 | |
| | |
AGCO Corp.(a) | | | 2,394 | | | | 274,496 | |
| | |
Alamo Group, Inc. | | | 342 | | | | 54,823 | |
| | |
Albany International Corp., Class A(a) | | | 2,052 | | | | 167,464 | |
| | |
Allison Transmission Holdings, Inc. | | | 18,190 | | | | 917,140 | |
| | |
Astec Industries, Inc. | | | 1,539 | | | | 61,622 | |
| | |
Barnes Group, Inc. | | | 1,368 | | | | 28,441 | |
| | |
Caterpillar, Inc. | | | 15,300 | | | | 3,458,565 | |
| | |
Chart Industries, Inc.* (a) | | | 1,530 | | | | 177,832 | |
| | |
Columbus McKinnon Corp. | | | 513 | | | | 15,682 | |
| | |
Crane Co. | | | 1,190 | | | | 115,823 | |
| | |
Cummins, Inc. | | | 4,275 | | | | 924,682 | |
| | |
Deere & Co. | | | 8,160 | | | | 2,981,338 | |
| | |
Desktop Metal, Inc., Class A* (a) | | | 58,650 | | | | 50,814 | |
| | |
Donaldson Co., Inc.(a) | | | 6,630 | | | | 382,286 | |
| | |
Douglas Dynamics, Inc.(a) | | | 342 | | | | 8,304 | |
| | |
Dover Corp. | | | 3,420 | | | | 444,429 | |
| | |
Energy Recovery, Inc.* (a) | | | 170 | | | | 2,584 | |
| | |
Enerpac Tool Group Corp., Class A | | | 4,788 | | | | 135,500 | |
| | |
EnPro Industries, Inc.(a) | | | 1,197 | | | | 132,939 | |
| | |
Esab Corp. | | | 3,740 | | | | 236,742 | |
| | |
ESCO Technologies, Inc. | | | 340 | | | | 33,055 | |
| | |
Federal Signal Corp. | | | 1,710 | | | | 99,248 | |
| | |
Flowserve Corp. | | | 6,840 | | | | 251,165 | |
| | |
Fortive Corp. | | | 7,650 | | | | 499,392 | |
| | |
Franklin Electric Co., Inc.(a) | | | 1,190 | | | | 103,197 | |
| | |
Gates Industrial Corp. plc* | | | 21,760 | | | | 237,619 | |
| | |
Gorman-Rupp Co. (The)(a) | | | 1,539 | | | | 45,477 | |
| | |
Graco, Inc. | | | 5,156 | | | | 383,349 | |
| | |
Greenbrier Cos., Inc. (The)(a) | | | 6,800 | | | | 235,212 | |
| | |
Helios Technologies, Inc.(a) | | | 2,550 | | | | 131,886 | |
| | |
Hillenbrand, Inc. | | | 5,100 | | | | 193,953 | |
See Accompanying Notes to the Financial Statements.
| | | | |
162 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
Hillman Solutions Corp.* | | | 8,330 | | | $ | 54,645 | |
| | |
Hyster-Yale Materials Handling, Inc. | | | 2,210 | | | | 88,422 | |
| | |
IDEX Corp. | | | 2,040 | | | | 390,476 | |
| | |
Illinois Tool Works, Inc. | | | 6,970 | | | | 1,562,116 | |
| | |
Ingersoll Rand, Inc. | | | 9,010 | | | | 546,727 | |
| | |
ITT, Inc.(a) | | | 4,446 | | | | 415,034 | |
| | |
John Bean Technologies Corp.(a) | | | 1,368 | | | | 142,299 | |
| | |
Kadant, Inc.(a) | | | 342 | | | | 75,240 | |
| | |
Kennametal, Inc.(a) | | | 4,788 | | | | 110,651 | |
| | |
Lincoln Electric Holdings, Inc.(a) | | | 1,870 | | | | 326,876 | |
| | |
Lindsay Corp. | | | 342 | | | | 42,723 | |
| | |
Luxfer Holdings plc | | | 5,950 | | | | 49,206 | |
| | |
Middleby Corp. (The)* (a) | | | 1,710 | | | | 193,008 | |
| | |
Mueller Industries, Inc.(a) | | | 25,836 | | | | 974,276 | |
| | |
Mueller Water Products, Inc., Class A(a) | | | 4,959 | | | | 61,343 | |
| | |
Nikola Corp.* (a) | | | 24,650 | | | | 26,622 | |
| | |
Nordson Corp. | | | 1,197 | | | | 254,470 | |
| | |
Oshkosh Corp. | | | 13,851 | | | | 1,215,148 | |
| | |
Otis Worldwide Corp. | | | 10,431 | | | | 805,377 | |
| | |
PACCAR, Inc. | | | 15,300 | | | | 1,262,709 | |
| | |
Parker-Hannifin Corp. | | | 3,078 | | | | 1,135,505 | |
| | |
Pentair plc | | | 4,590 | | | | 266,771 | |
| | |
RBC Bearings, Inc.* (a) | | | 1,020 | | | | 224,237 | |
| | |
REV Group, Inc. | | | 6,498 | | | | 92,532 | |
| | |
Shyft Group, Inc. (The) | | | 4,590 | | | | 50,398 | |
| | |
Snap-on, Inc. | | | 1,539 | | | | 396,970 | |
| | |
SPX Technologies, Inc.* | | | 1,368 | | | | 109,604 | |
| | |
Standex International Corp. | | | 171 | | | | 24,550 | |
| | |
Stanley Black & Decker, Inc. | | | 2,720 | | | | 231,336 | |
| | |
Tennant Co. | | | 1,870 | | | | 138,791 | |
| | |
Terex Corp.(a) | | | 13,509 | | | | 618,712 | |
| | |
Timken Co. (The) | | | 3,910 | | | | 270,259 | |
| | |
Titan International, Inc.* | | | 11,900 | | | | 135,184 | |
| | |
Toro Co. (The)(a) | | | 3,078 | | | | 248,825 | |
| | |
Trinity Industries, Inc. | | | 2,736 | | | | 56,991 | |
| | |
Wabash National Corp.(a) | | | 8,160 | | | | 168,830 | |
| | |
Watts Water Technologies, Inc., Class A | | | 855 | | | | 147,924 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Machinery – (continued) | |
| | |
Westinghouse Air Brake Technologies Corp. | | | 4,617 | | | $ | 489,494 | |
| | |
Xylem, Inc. | | | 6,800 | | | | 636,072 | |
| | | | | | | 26,867,263 | |
|
Marine Transportation – 0.1% | |
| | |
Eagle Bulk Shipping, Inc.(a) | | | 3,230 | | | | 131,784 | |
| | |
Genco Shipping & Trading Ltd.(a) | | | 11,900 | | | | 156,723 | |
| | |
Kirby Corp.* | | | 3,740 | | | | 279,378 | |
| | |
Matson, Inc.(a) | | | 6,800 | | | | 591,940 | |
| | | | | | | 1,159,825 | |
|
Media – 1.0% | |
| | |
Altice USA, Inc., Class A* (a) | | | 26,520 | | | | 76,643 | |
| | |
Cable One, Inc.(a) | | | 170 | | | | 93,478 | |
| | |
Charter Communications, Inc., Class A* (a) | | | 3,230 | | | | 1,301,044 | |
| | |
Clear Channel Outdoor Holdings, Inc.* (a) | | | 119,340 | | | | 131,274 | |
| | |
Comcast Corp., Class A | | | 126,990 | | | | 5,243,417 | |
| | |
DISH Network Corp., Class A* (a) | | | 39,610 | | | | 194,089 | |
| | |
EW Scripps Co. (The), Class A* (a) | | | 4,590 | | | | 25,107 | |
| | |
Fox Corp., Class A | | | 9,860 | | | | 299,645 | |
| | |
Fox Corp., Class B | | | 1,870 | | | | 52,192 | |
| | |
Gray Television, Inc. | | | 11,560 | | | | 75,371 | |
| | |
Integral Ad Science Holding Corp.* (a) | | | 6,800 | | | | 78,064 | |
| | |
Interpublic Group of Cos., Inc. (The)(a) | | | 10,431 | | | | 296,240 | |
| | |
John Wiley & Sons, Inc., Class A(a) | | | 11,220 | | | | 339,629 | |
| | |
Liberty Broadband Corp., Class A* | | | 1,360 | | | | 113,315 | |
| | |
Liberty Broadband Corp., Class C* | | | 2,550 | | | | 212,441 | |
| | |
Liberty Media Corp-Liberty SiriusXM* (a) | | | 4,446 | | | | 109,149 | |
| | |
Liberty Media Corp-Liberty SiriusXM, Class A* | | | 1,881 | | | | 46,066 | |
| | |
Magnite, Inc.* (a) | | | 13,090 | | | | 86,918 | |
| | |
New York Times Co. (The), Class A | | | 9,234 | | | | 372,223 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 163 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Media – (continued) | |
| | |
News Corp., Class A | | | 8,892 | | | $ | 183,887 | |
| | |
News Corp., Class B(a) | | | 2,907 | | | | 62,326 | |
| | |
Nexstar Media Group, Inc., Class A(a) | | | 7,990 | | | | 1,119,239 | |
| | |
Omnicom Group, Inc. | | | 6,498 | | | | 486,765 | |
| | |
Paramount Global, Class B(a) | | | 11,730 | | | | 127,622 | |
| | |
PubMatic, Inc., Class A* (a) | | | 6,630 | | | | 74,720 | |
| | |
Scholastic Corp.(a) | | | 684 | | | | 25,240 | |
| | |
Sinclair, Inc.(a) | | | 10,710 | | | | 116,418 | |
| | |
Sirius XM Holdings, Inc.(a) | | | 28,010 | | | | 119,883 | |
| | |
Stagwell, Inc., Class A* | | | 24,140 | | | | 99,457 | |
| | |
TechTarget, Inc.* (a) | | | 1,026 | | | | 25,835 | |
| | |
TEGNA, Inc.(a) | | | 44,710 | | | | 648,742 | |
| | |
Thryv Holdings, Inc.* (a) | | | 850 | | | | 14,815 | |
| | |
Trade Desk, Inc. (The), Class A* | | | 10,431 | | | | 740,184 | |
| | |
WideOpenWest, Inc.* | | | 6,156 | | | | 43,338 | |
| | | | | | | 13,034,776 | |
|
Metals & Mining – 0.9% | |
| | |
Alcoa Corp.(a) | | | 9,860 | | | | 252,810 | |
| | |
Alpha Metallurgical Resources, Inc.(a) | | | 3,060 | | | | 673,078 | |
| | |
Arch Resources, Inc. | | | 3,933 | | | | 593,214 | |
| | |
ATI, Inc.* (a) | | | 7,650 | | | | 288,940 | |
| | |
Carpenter Technology Corp. | | | 3,400 | | | | 213,248 | |
| | |
Century Aluminum Co.* (a) | | | 9,234 | | | | 61,037 | |
| | |
Cleveland-Cliffs, Inc.* | | | 17,442 | | | | 292,677 | |
| | |
Coeur Mining, Inc.* (a) | | | 6,327 | | | | 15,881 | |
| | |
Commercial Metals Co. | | | 26,520 | | | | 1,121,531 | |
| | |
Compass Minerals International, Inc. | | | 855 | | | | 21,067 | |
| | |
Freeport-McMoRan, Inc. | | | 44,880 | | | | 1,516,046 | |
| | |
Hecla Mining Co.(a) | | | 13,680 | | | | 55,678 | |
| | |
Materion Corp. | | | 513 | | | | 49,751 | |
| | |
MP Materials Corp.* (a) | | | 10,370 | | | | 170,068 | |
| | |
Newmont Corp.(a) | | | 28,560 | | | | 1,070,143 | |
| | |
Nucor Corp. | | | 8,160 | | | | 1,205,966 | |
| | |
Olympic Steel, Inc. | | | 340 | | | | 17,262 | |
| | |
Piedmont Lithium, Inc.* | | | 3,078 | | | | 84,553 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Reliance Steel & Aluminum Co. | | | 2,040 | | | $ | 518,935 | |
| | |
Royal Gold, Inc.(a) | | | 2,380 | | | | 248,305 | |
| | |
Ryerson Holding Corp. | | | 3,570 | | | | 103,709 | |
| | |
Schnitzer Steel Industries, Inc., Class A | | | 3,230 | | | | 73,353 | |
| | |
Southern Copper Corp.(a) | | | 1,710 | | | | 121,239 | |
| | |
Steel Dynamics, Inc. | | | 5,610 | | | | 597,521 | |
| | |
SunCoke Energy, Inc. | | | 9,350 | | | | 88,918 | |
| | |
TimkenSteel Corp.* (a) | | | 8,550 | | | | 173,822 | |
| | |
United States Steel Corp.(a) | | | 46,580 | | | | 1,578,596 | |
| | |
Warrior Met Coal, Inc. | | | 9,520 | | | | 463,910 | |
| | |
Worthington Industries, Inc. | | | 7,480 | | | | 460,918 | |
| | | | | | | 12,132,176 | |
|
Mortgage Real Estate Investment Trusts (REITs) – 0.6% | |
| | |
AGNC Investment Corp.(a) | | | 124,610 | | | | 919,622 | |
| | |
Annaly Capital Management, Inc.(a) | | | 10,880 | | | | 169,837 | |
| | |
Apollo Commercial Real Estate Finance, Inc.(a) | | | 20,400 | | | | 203,184 | |
| | |
Arbor Realty Trust, Inc.(a) | | | 41,650 | | | | 525,206 | |
| | |
Ares Commercial Real Estate Corp. | | | 20,230 | | | | 185,509 | |
| | |
ARMOUR Residential REIT, Inc.(a) | | | 12,648 | | | | 184,281 | |
| | |
Blackstone Mortgage Trust, Inc., Class A(a) | | | 34,000 | | | | 678,300 | |
| | |
BrightSpire Capital, Inc., Class A(a) | | | 27,030 | | | | 152,990 | |
| | |
Chimera Investment Corp.(a) | | | 36,890 | | | | 177,072 | |
| | |
Claros Mortgage Trust, Inc.(a) | | | 34,000 | | | | 354,620 | |
| | |
Ellington Financial, Inc.(a) | | | 14,706 | | | | 176,913 | |
| | |
Franklin BSP Realty Trust, Inc.(a) | | | 17,510 | | | | 220,801 | |
| | |
Hannon Armstrong Sustainable Infrastructure Capital, Inc.(a) | | | 7,820 | | | | 134,035 | |
| | |
Invesco Mortgage Capital, Inc. | | | 1 | | | | 4 | |
| | |
KKR Real Estate Finance Trust, Inc.(a) | | | 16,490 | | | | 172,156 | |
See Accompanying Notes to the Financial Statements.
| | | | |
164 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Mortgage Real Estate Investment Trusts (REITs) – (continued) | |
| | |
Ladder Capital Corp., Class A | | | 31,280 | | | $ | 316,241 | |
| | |
MFA Financial, Inc.(a) | | | 19,380 | | | | 172,288 | |
| | |
New York Mortgage Trust, Inc.(a) | | | 7,310 | | | | 56,945 | |
| | |
PennyMac Mortgage Investment Trust(a) | | | 19,720 | | | | 249,458 | |
| | |
Ready Capital Corp.(a) | | | 26,010 | | | | 245,274 | |
| | |
Redwood Trust, Inc.(a) | | | 18,700 | | | | 117,436 | |
| | |
Rithm Capital Corp.(a) | | | 110,330 | | | | 1,029,379 | |
| | |
Starwood Property Trust, Inc.(a) | | | 63,580 | | | | 1,128,545 | |
| | |
TPG RE Finance Trust, Inc. | | | 2,210 | | | | 12,177 | |
| | |
Two Harbors Investment Corp. | | | 18,870 | | | | 219,081 | |
| | | | | | | 7,801,354 | |
|
Multi-Utilities – 0.5% | |
| | |
Ameren Corp. | | | 5,985 | | | | 453,124 | |
| | |
Avista Corp.(a) | | | 5,950 | | | | 188,555 | |
| | |
Black Hills Corp. | | | 1,700 | | | | 82,195 | |
| | |
CenterPoint Energy, Inc. | | | 17,340 | | | | 466,099 | |
| | |
CMS Energy Corp. | | | 5,780 | | | | 314,085 | |
| | |
Consolidated Edison, Inc. | | | 9,350 | | | | 820,837 | |
| | |
Dominion Energy, Inc. | | | 27,200 | | | | 1,096,704 | |
| | |
DTE Energy Co. | | | 5,270 | | | | 507,923 | |
| | |
NiSource, Inc.(a) | | | 12,166 | | | | 306,097 | |
| | |
Northwestern Energy Group, Inc.(a) | | | 3,910 | | | | 187,719 | |
| | |
Public Service Enterprise Group, Inc.(a) | | | 13,090 | | | | 806,998 | |
| | |
Sempra | | | 18,020 | | | | 1,261,941 | |
| | |
Unitil Corp. | | | 2,040 | | | | 93,167 | |
| | |
WEC Energy Group, Inc. | | | 6,800 | | | | 553,452 | |
| | | | | | | 7,138,896 | |
|
Office REITs – 0.2% | |
| | |
Alexandria Real Estate Equities, Inc., REIT | | | 3,060 | | | | 284,978 | |
| | |
Boston Properties, Inc., REIT(a) | | | 4,930 | | | | 264,100 | |
| | |
Brandywine Realty Trust, REIT(a) | | | 40,460 | | | | 151,321 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Office REITs – (continued) | |
| | |
COPT Defense Properties, REIT | | | 2,890 | | | $ | 65,892 | |
| | |
Cousins Properties, Inc., REIT | | | 2,890 | | | | 51,644 | |
| | |
Douglas Emmett, Inc., REIT(a) | | | 14,110 | | | | 158,173 | |
| | |
Easterly Government Properties, Inc., Class A, REIT(a) | | | 9,350 | | | | 100,606 | |
| | |
Equity Commonwealth, REIT | | | 2,210 | | | | 41,857 | |
| | |
Highwoods Properties, Inc., REIT(a) | | | 8,670 | | | | 155,106 | |
| | |
Hudson Pacific Properties, Inc., REIT(a) | | | 40,460 | | | | 180,452 | |
| | |
Kilroy Realty Corp., REIT | | | 7,310 | | | | 208,920 | |
| | |
Paramount Group, Inc., REIT(a) | | | 37,230 | | | | 159,344 | |
| | |
Piedmont Office Realty Trust, Inc., Class A, REIT | | | 13,090 | | | | 68,199 | |
| | |
SL Green Realty Corp., REIT(a) | | | 16,150 | | | | 473,034 | |
| | |
Vornado Realty Trust, REIT(a) | | | 35,360 | | | | 678,912 | |
| | | | | | | 3,042,538 | |
|
Oil, Gas & Consumable Fuels – 5.4% | |
| | |
Antero Midstream Corp. | | | 22,440 | | | | 276,910 | |
| | |
Antero Resources Corp.* | | | 63,070 | | | | 1,856,781 | |
| | |
APA Corp. | | | 11,390 | | | | 452,411 | |
| | |
Berry Corp. | | | 24,990 | | | | 208,667 | |
| | |
California Resources Corp.(a) | | | 14,280 | | | | 750,985 | |
| | |
Callon Petroleum Co.* (a) | | | 9,918 | | | | 370,437 | |
| | |
Cheniere Energy, Inc. | | | 7,695 | | | | 1,280,602 | |
| | |
Chesapeake Energy Corp.(a) | | | 3,609 | | | | 310,663 | |
| | |
Chevron Corp. | | | 54,174 | | | | 7,894,777 | |
| | |
Chord Energy Corp. | | | 8,670 | | | | 1,433,324 | |
| | |
Civitas Resources, Inc.(a) | | | 17,850 | | | | 1,346,432 | |
| | |
Clean Energy Fuels Corp.* (a) | | | 2,907 | | | | 10,145 | |
| | |
CNX Resources Corp.* (a) | | | 39,270 | | | | 852,944 | |
| | |
Comstock Resources, Inc.(a) | | | 16,416 | | | | 206,842 | |
| | |
ConocoPhillips | | | 37,060 | | | | 4,402,728 | |
| | |
CONSOL Energy, Inc.(a) | | | 5,950 | | | | 546,746 | |
| | |
Coterra Energy, Inc. | | | 24,796 | | | | 681,889 | |
| | |
Crescent Energy Co., Class A | | | 18,360 | | | | 223,625 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 165 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
CVR Energy, Inc.(a) | | | 7,990 | | | $ | 261,673 | |
| | |
Delek US Holdings, Inc.(a) | | | 11,900 | | | | 313,565 | |
| | |
Denbury, Inc.* | | | 3,060 | | | | 272,003 | |
| | |
Devon Energy Corp. | | | 17,680 | | | | 823,358 | |
| | |
Diamondback Energy, Inc.(a) | | | 5,814 | | | | 932,100 | |
| | |
Dorian LPG Ltd.(a) | | | 7,695 | | | | 246,009 | |
| | |
DT Midstream, Inc.(a) | | | 5,950 | | | | 321,121 | |
| | |
Earthstone Energy, Inc., Class A* | | | 9,860 | | | | 208,736 | |
| | |
EOG Resources, Inc. | | | 17,000 | | | | 2,146,250 | |
| | |
EQT Corp.(a) | | | 11,115 | | | | 471,054 | |
| | |
Equitrans Midstream Corp. | | | 93,160 | | | | 826,329 | |
| | |
Exxon Mobil Corp. | | | 122,230 | | | | 12,938,045 | |
| | |
Green Plains, Inc.* (a) | | | 4,617 | | | | 135,647 | |
| | |
Gulfport Energy Corp.* (a) | | | 1,870 | | | | 231,151 | |
| | |
Hess Corp. | | | 7,310 | | | | 1,055,564 | |
| | |
HF Sinclair Corp. | | | 5,610 | | | | 310,682 | |
| | |
HighPeak Energy, Inc.(a) | | | 5,950 | | | | 105,374 | |
| | |
International Seaways, Inc. | | | 6,120 | | | | 294,311 | |
| | |
Kinder Morgan, Inc.(a) | | | 56,610 | | | | 917,082 | |
| | |
Kosmos Energy Ltd.* (a) | | | 89,401 | | | | 647,263 | |
| | |
Magnolia Oil & Gas Corp., Class A(a) | | | 37,570 | | | | 843,447 | |
| | |
Marathon Oil Corp. | | | 21,590 | | | | 589,623 | |
| | |
Marathon Petroleum Corp. | | | 12,750 | | | | 1,928,437 | |
| | |
Matador Resources Co.(a) | | | 23,460 | | | | 1,447,247 | |
| | |
Murphy Oil Corp. | | | 30,600 | | | | 1,373,022 | |
| | |
New Fortress Energy, Inc.(a) | | | 16,660 | | | | 504,798 | |
| | |
NextDecade Corp.* (a) | | | 3,078 | | | | 13,512 | |
| | |
Northern Oil and Gas, Inc.(a) | | | 16,830 | | | | 645,262 | |
| | |
Occidental Petroleum Corp.(a) | | | 20,060 | | | | 1,239,909 | |
| | |
ONEOK, Inc. | | | 17,680 | | | | 1,152,736 | |
| | |
Ovintiv, Inc. | | | 9,023 | | | | 433,104 | |
| | |
Par Pacific Holdings, Inc.* | | | 10,200 | | | | 334,764 | |
| | |
PBF Energy, Inc., Class A | | | 23,651 | | | | 1,124,132 | |
| | |
Peabody Energy Corp.(a) | | | 23,769 | | | | 560,711 | |
| | |
Permian Resources Corp., Class A(a) | | | 61,200 | | | | 891,684 | |
| | |
Phillips 66 | | | 13,940 | | | | 1,590,136 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Pioneer Natural Resources Co. | | | 6,800 | | | $ | 1,625,200 | |
| | |
Range Resources Corp.(a) | | | 50,150 | | | | 1,797,376 | |
| | |
SandRidge Energy, Inc. | | | 1,700 | | | | 26,945 | |
| | |
SilverBow Resources, Inc.* (a) | | | 1,020 | | | | 34,782 | |
| | |
Sitio Royalties Corp., Class A | | | 1,190 | | | | 29,417 | |
| | |
SM Energy Co.(a) | | | 27,370 | | | | 1,103,558 | |
| | |
Southwestern Energy Co.* (a) | | | 253,810 | | | | 1,809,665 | |
| | |
Talos Energy, Inc.* (a) | | | 18,190 | | | | 281,945 | |
| | |
Targa Resources Corp.(a) | | | 6,460 | | | | 540,121 | |
| | |
Tellurian, Inc.* (a) | | | 166,090 | | | | 114,602 | |
| | |
Texas Pacific Land Corp.(a) | | | 171 | | | | 315,657 | |
| | |
Uranium Energy Corp.* (a) | | | 3,249 | | | | 19,332 | |
| | |
VAALCO Energy, Inc.(a) | | | 12,580 | | | | 56,233 | |
| | |
Valero Energy Corp.(a) | | | 11,390 | | | | 1,446,530 | |
| | |
Vertex Energy, Inc.* (a) | | | 20,570 | | | | 88,657 | |
| | |
Vital Energy, Inc.* (a) | | | 2,720 | | | | 136,109 | |
| | |
Vitesse Energy, Inc. | | | 2,380 | | | | 56,382 | |
| | |
W&T Offshore, Inc.* (a) | | | 28,390 | | | | 117,818 | |
| | |
Williams Cos., Inc. (The) | | | 31,620 | | | | 1,087,728 | |
| | |
World Kinect Corp.(a) | | | 12,141 | | | | 224,608 | |
| | | | | | | 72,149,414 | |
|
Paper & Forest Products – 0.0%(d) | |
| | |
Clearwater Paper Corp.* | | | 2,223 | | | | 75,160 | |
| | |
Louisiana-Pacific Corp. | | | 4,420 | | | | 226,658 | |
| | |
Mercer International, Inc.(a) | | | 9,576 | | | | 76,033 | |
| | |
Sylvamo Corp.(a) | | | 5,814 | | | | 257,560 | |
| | | | | | | 635,411 | |
|
Passenger Airlines – 0.2% | |
| | |
Alaska Air Group, Inc.* (a) | | | 26,350 | | | | 833,450 | |
| | |
Allegiant Travel Co.(a) | | | 1,360 | | | | 90,603 | |
| | |
American Airlines Group, Inc.* (a) | | | 25,500 | | | | 284,325 | |
| | |
Delta Air Lines, Inc. | | | 18,639 | | | | 582,469 | |
| | |
Frontier Group Holdings, Inc.* (a) | | | 7,053 | | | | 23,910 | |
| | |
Hawaiian Holdings, Inc.* (a) | | | 9,690 | | | | 40,795 | |
| | |
JetBlue Airways Corp.* (a) | | | 64,093 | | | | 240,990 | |
| | |
Joby Aviation, Inc.* (a) | | | 11,390 | | | | 60,025 | |
| | |
SkyWest, Inc.* | | | 11,220 | | | | 473,147 | |
See Accompanying Notes to the Financial Statements.
| | | | |
166 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Passenger Airlines – (continued) | |
| | |
Southwest Airlines Co.(a) | | | 16,320 | | | $ | 362,794 | |
| | |
United Airlines Holdings, Inc.* | | | 7,990 | | | | 279,730 | |
| | | | | | | 3,272,238 | |
|
Personal Care Products – 0.2% | |
| | |
BellRing Brands, Inc.* | | | 4,788 | | | | 209,379 | |
| | |
Coty, Inc., Class A* (a) | | | 16,320 | | | | 152,918 | |
| | |
Edgewell Personal Care Co.(a) | | | 4,262 | | | | 148,744 | |
| | |
elf Beauty, Inc.* (a) | | | 1,870 | | | | 173,218 | |
| | |
Estee Lauder Cos., Inc. (The), Class A | | | 5,270 | | | | 679,145 | |
| | |
Herbalife Ltd.* (a) | | | 15,810 | | | | 225,293 | |
| | |
Inter Parfums, Inc. | | | 513 | | | | 65,207 | |
| | |
Medifast, Inc.(a) | | | 3,400 | | | | 235,144 | |
| | |
Nu Skin Enterprises, Inc., Class A | | | 5,270 | | | | 100,077 | |
| | |
USANA Health Sciences, Inc.* | | | 1,530 | | | | 69,692 | |
| | | | | | | 2,058,817 | |
|
Pharmaceuticals – 3.1% | |
| | |
Aclaris Therapeutics, Inc.* (a) | | | 684 | | | | 3,406 | |
| | |
Amphastar Pharmaceuticals, Inc.* (a) | | | 1,026 | | | | 46,447 | |
| | |
ANI Pharmaceuticals, Inc.* (a) | | | 171 | | | | 10,558 | |
| | |
Arvinas, Inc.* (a) | | | 5,440 | | | | 87,693 | |
| | |
Axsome Therapeutics, Inc.* (a) | | | 1,710 | | | | 106,499 | |
| | |
Bristol-Myers Squibb Co. | | | 62,730 | | | | 3,232,477 | |
| | |
Catalent, Inc.* | | | 4,590 | | | | 157,850 | |
| | |
Collegium Pharmaceutical, Inc.* (a) | | | 9,405 | | | | 204,653 | |
| | |
Corcept Therapeutics, Inc.* (a) | | | 4,159 | | | | 116,785 | |
| | |
Elanco Animal Health, Inc.* (a) | | | 112,540 | | | | 991,477 | |
| | |
Eli Lilly & Co. | | | 19,720 | | | | 10,923,500 | |
| | |
Evolus, Inc.* | | | 1,881 | | | | 14,296 | |
| | |
Harmony Biosciences Holdings, Inc.* | | | 684 | | | | 16,101 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Pharmaceuticals – (continued) | |
| | |
Innoviva, Inc.* (a) | | | 18,020 | | | $ | 223,628 | |
| | |
Intra-Cellular Therapies, Inc.* | | | 2,890 | | | | 143,806 | |
| | |
Jazz Pharmaceuticals plc* | | | 2,550 | | | | 323,901 | |
| | |
Johnson & Johnson | | | 59,500 | | | | 8,826,230 | |
| | |
Ligand Pharmaceuticals, Inc.* | | | 684 | | | | 35,766 | |
| | |
Merck & Co., Inc. | | | 63,410 | | | | 6,512,207 | |
| | |
Organon & Co. | | | 51,510 | | | | 761,833 | |
| | |
Perrigo Co. plc | | | 6,120 | | | | 169,157 | |
| | |
Pfizer, Inc. | | | 173,740 | | | | 5,309,494 | |
| | |
Prestige Consumer Healthcare, Inc.* | | | 3,740 | | | | 222,007 | |
| | |
Revance Therapeutics, Inc.* (a) | | | 2,907 | | | | 22,936 | |
| | |
Royalty Pharma plc, Class A | | | 14,620 | | | | 392,839 | |
| | |
Scilex Holding Co.* | | | 14,036 | | | | 26,247 | |
| | |
Supernus Pharmaceuticals, Inc.* | | | 4,420 | | | | 105,417 | |
| | |
Tilray Brands, Inc.* | | | 171,190 | | | | 308,142 | |
| | |
Viatris, Inc. | | | 30,940 | | | | 275,366 | |
| | |
Zoetis, Inc., Class A | | | 11,900 | | | | 1,868,300 | |
| | | | | | | 41,439,018 | |
|
Professional Services – 1.2% | |
| | |
Alight, Inc., Class A* | | | 75,480 | | | | 501,187 | |
| | |
ASGN, Inc.* (a) | | | 10,540 | | | | 879,668 | |
| | |
Automatic Data Processing, Inc. | | | 10,370 | | | | 2,262,941 | |
| | |
Barrett Business Services, Inc. | | | 855 | | | | 78,198 | |
| | |
Booz Allen Hamilton Holding Corp., Class A | | | 3,078 | | | | 369,145 | |
| | |
Broadridge Financial Solutions, Inc. | | | 2,550 | | | | 435,132 | |
| | |
CACI International, Inc., Class A* | | | 1,190 | | | | 386,464 | |
| | |
CBIZ, Inc.* | | | 1,710 | | | | 88,852 | |
| | |
Ceridian HCM Holding, Inc.* (a) | | | 4,760 | | | | 304,688 | |
| | |
Clarivate plc* (a) | | | 84,150 | | | | 536,877 | |
| | |
Concentrix Corp.(a) | | | 8,330 | | | | 634,829 | |
| | |
Conduent, Inc.* | | | 44,273 | | | | 141,231 | |
| | |
CSG Systems International, Inc.(a) | | | 2,736 | | | | 128,209 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 167 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Professional Services – (continued) | |
| | |
Dun & Bradstreet Holdings, Inc.(a) | | | 52,360 | | | $ | 458,674 | |
| | |
Equifax, Inc.(a) | | | 3,230 | | | | 547,711 | |
| | |
ExlService Holdings, Inc.* | | | 5,950 | | | | 155,355 | |
| | |
Exponent, Inc. | | | 1,870 | | | | 137,052 | |
| | |
First Advantage Corp. | | | 684 | | | | 8,899 | |
| | |
FTI Consulting, Inc.* (a) | | | 1,190 | | | | 252,589 | |
| | |
Genpact Ltd. | | | 3,591 | | | | 120,442 | |
| | |
Heidrick & Struggles International, Inc. | | | 5,610 | | | | 136,547 | |
| | |
Huron Consulting Group, Inc.* | | | 513 | | | | 50,972 | |
| | |
ICF International, Inc.(a) | | | 513 | | | | 65,013 | |
| | |
Insperity, Inc. | | | 1,190 | | | | 125,950 | |
| | |
Jacobs Solutions, Inc. | | | 3,570 | | | | 475,881 | |
| | |
KBR, Inc.(a) | | | 4,760 | | | | 276,794 | |
| | |
Kelly Services, Inc., Class A | | | 7,524 | | | | 134,304 | |
| | |
Kforce, Inc.(a) | | | 342 | | | | 20,876 | |
| | |
Korn Ferry | | | 9,860 | | | | 448,827 | |
| | |
Legalzoom.com, Inc.* | | | 11,220 | | | | 111,863 | |
| | |
Leidos Holdings, Inc. | | | 3,591 | | | | 355,940 | |
| | |
ManpowerGroup, Inc. | | | 9,860 | | | | 689,904 | |
| | |
Maximus, Inc. | | | 3,570 | | | | 266,751 | |
| | |
NV5 Global, Inc.* | | | 170 | | | | 16,040 | |
| | |
Paychex, Inc. | | | 7,695 | | | | 854,530 | |
| | |
Paycom Software, Inc. | | | 1,197 | | | | 293,229 | |
| | |
Paylocity Holding Corp.* | | | 1,026 | | | | 184,064 | |
| | |
Resources Connection, Inc. | | | 5,472 | | | | 73,708 | |
| | |
Robert Half, Inc.(a) | | | 3,420 | | | | 255,713 | |
| | |
Science Applications International Corp.(a) | | | 3,060 | | | | 334,274 | |
| | |
SS&C Technologies Holdings, Inc. | | | 5,301 | | | | 266,375 | |
| | |
Sterling Check Corp.* (a) | | | 8,160 | | | | 91,229 | |
| | |
TransUnion | | | 3,740 | | | | 164,111 | |
| | |
TriNet Group, Inc.* | | | 1,870 | | | | 192,143 | |
| | |
TrueBlue, Inc.* | | | 1,870 | | | | 20,701 | |
| | |
TTEC Holdings, Inc. | | | 340 | | | | 6,997 | |
| | |
Upwork, Inc.* | | | 11,900 | | | | 124,355 | |
| | |
Verisk Analytics, Inc., Class A | | | 3,762 | | | | 855,328 | |
| | |
Verra Mobility Corp., Class A* | | | 10,260 | | | | 202,840 | |
| | | | | | | 15,523,402 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Real Estate Management & Development – 0.4% | |
| | |
Anywhere Real Estate, Inc.* (a) | | | 28,730 | | | $ | 134,169 | |
| | |
CBRE Group, Inc., Class A* | | | 9,918 | | | | 687,714 | |
| | |
Compass, Inc., Class A* (a) | | | 76,500 | | | | 151,470 | |
| | |
CoStar Group, Inc.* | | | 10,030 | | | | 736,302 | |
| | |
Cushman & Wakefield plc* (a) | | | 47,430 | | | | 349,559 | |
| | |
DigitalBridge Group, Inc. | | | 8,840 | | | | 140,114 | |
| | |
eXp World Holdings, Inc.(a) | | | 2,565 | | | | 34,038 | |
| | |
Forestar Group, Inc.* (a) | | | 7,140 | | | | 169,575 | |
| | |
Howard Hughes Holdings, Inc.* (a) | | | 2,040 | | | | 135,313 | |
| | |
Jones Lang LaSalle, Inc.* (a) | | | 10,370 | | | | 1,326,530 | |
| | |
Kennedy-Wilson Holdings, Inc.(a) | | | 7,310 | | | | 94,080 | |
| | |
Newmark Group, Inc., Class A(a) | | | 38,590 | | | | 218,805 | |
| | |
Opendoor Technologies, Inc.* (a) | | | 132,430 | | | | 251,617 | |
| | |
Redfin Corp.* (a) | | | 4,930 | | | | 22,974 | |
| | |
Seritage Growth Properties, Class A, REIT* (a) | | | 13,338 | | | | 96,567 | |
| | |
St Joe Co. (The) | | | 513 | | | | 23,926 | |
| | |
Zillow Group, Inc., Class A* | | | 513 | | | | 18,227 | |
| | |
Zillow Group, Inc., Class C* (a) | | | 5,610 | | | | 203,363 | |
| | | | | | | 4,794,343 | |
|
Residential REITs – 0.3% | |
| | |
American Homes 4 Rent, Class A, REIT | | | 6,156 | | | | 201,548 | |
| | |
Apartment Income REIT Corp., Class A, REIT | | | 9,010 | | | | 263,182 | |
| | |
AvalonBay Communities, Inc., REIT | | | 3,230 | | | | 535,340 | |
| | |
Camden Property Trust, REIT | | | 3,060 | | | | 259,733 | |
| | |
Equity LifeStyle Properties, Inc., REIT(a) | | | 4,446 | | | | 292,547 | |
| | |
Equity Residential, REIT | | | 7,310 | | | | 404,462 | |
| | |
Essex Property Trust, Inc., REIT(a) | | | 1,530 | | | | 327,298 | |
| | |
Independence Realty Trust, Inc., REIT(a) | | | 6,290 | | | | 77,933 | |
See Accompanying Notes to the Financial Statements.
| | | | |
168 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Residential REITs – (continued) | |
| | |
Invitation Homes, Inc., REIT(a) | | | 12,996 | | | $ | 385,851 | |
| | |
Mid-America Apartment Communities, Inc., REIT | | | 2,736 | | | | 323,258 | |
| | |
NexPoint Residential Trust, Inc., REIT | | | 2,720 | | | | 73,413 | |
| | |
Sun Communities, Inc., REIT(a) | | | 3,740 | | | | 416,038 | |
| | |
UDR, Inc., REIT | | | 9,520 | | | | 302,831 | |
| | | | | | | 3,863,434 | |
|
Retail REITs – 0.4% | |
| | |
Acadia Realty Trust, REIT(a) | | | 9,690 | | | | 138,761 | |
| | |
Agree Realty Corp., REIT(a) | | | 5,780 | | | | 323,333 | |
| | |
Alexander’s, Inc., REIT(a) | | | 510 | | | | 95,875 | |
| | |
Brixmor Property Group, Inc., REIT(a) | | | 10,431 | | | | 216,860 | |
| | |
CBL & Associates Properties, Inc., REIT(a) | | | 3,740 | | | | 77,530 | |
| | |
Federal Realty Investment Trust, REIT(a) | | | 1,710 | | | | 155,935 | |
| | |
Getty Realty Corp., REIT | | | 171 | | | | 4,552 | |
| | |
Kimco Realty Corp., REIT | | | 18,126 | | | | 325,180 | |
| | |
Kite Realty Group Trust, REIT(a) | | | 46,070 | | | | 982,212 | |
| | |
Macerich Co. (The), REIT(a) | | | 51,680 | | | | 502,330 | |
| | |
NNN REIT, Inc., REIT(a) | | | 2,907 | | | | 105,611 | |
| | |
Phillips Edison & Co., Inc., REIT(a) | | | 3,230 | | | | 114,051 | |
| | |
Realty Income Corp., REIT(a) | | | 16,660 | | | | 789,351 | |
| | |
Regency Centers Corp., REIT | | | 4,456 | | | | 268,519 | |
| | |
Retail Opportunity Investments Corp., REIT | | | 11,900 | | | | 139,706 | |
| | |
RPT Realty, REIT | | | 8,550 | | | | 92,255 | |
| | |
Simon Property Group, Inc., REIT | | | 7,480 | | | | 821,977 | |
| | |
SITE Centers Corp., REIT | | | 4,959 | | | | 57,822 | |
| | |
Spirit Realty Capital, Inc., REIT | | | 5,950 | | | | 214,141 | |
| | |
Tanger Factory Outlet Centers, Inc., REIT(a) | | | 8,330 | | | | 187,841 | |
| | |
Urban Edge Properties, REIT(a) | | | 4,617 | | | | 73,226 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Retail REITs – (continued) | |
| | |
Whitestone REIT, REIT(a) | | | 3,060 | | | $ | 30,447 | |
| | | | | | | 5,717,515 | |
|
Semiconductors & Semiconductor Equipment – 5.5% | |
| | |
ACM Research, Inc., Class A* | | | 10,540 | | | | 143,344 | |
| | |
Advanced Micro Devices, Inc.* | | | 39,827 | | | | 3,922,960 | |
| | |
Allegro MicroSystems, Inc.* | | | 1,700 | | | | 44,132 | |
| | |
Alpha & Omega Semiconductor Ltd.* | | | 3,910 | | | | 92,745 | |
| | |
Ambarella, Inc.* | | | 850 | | | | 38,242 | |
| | |
Amkor Technology, Inc. | | | 18,810 | | | | 392,377 | |
| | |
Analog Devices, Inc. | | | 12,920 | | | | 2,032,704 | |
| | |
Applied Materials, Inc. | | | 21,250 | | | | 2,812,437 | |
| | |
Axcelis Technologies, Inc.* | | | 1,026 | | | | 130,815 | |
| | |
Broadcom, Inc. | | | 12,578 | | | | 10,582,752 | |
| | |
Cirrus Logic, Inc.* (a) | | | 2,040 | | | | 136,537 | |
| | |
Cohu, Inc.* | | | 1,197 | | | | 36,078 | |
| | |
Credo Technology Group Holding Ltd.* (a) | | | 5,780 | | | | 82,192 | |
| | |
Diodes, Inc.* (a) | | | 9,234 | | | | 600,949 | |
| | |
Enphase Energy, Inc.* (a) | | | 2,890 | | | | 229,986 | |
| | |
Entegris, Inc.(a) | | | 3,910 | | | | 344,236 | |
| | |
First Solar, Inc.* | | | 2,210 | | | | 314,815 | |
| | |
FormFactor, Inc.* | | | 2,223 | | | | 75,315 | |
| | |
Ichor Holdings Ltd.* (a) | | | 3,740 | | | | 90,732 | |
| | |
Impinj, Inc.* (a) | | | 1,368 | | | | 88,386 | |
| | |
indie Semiconductor, Inc., Class A* (a) | | | 9,180 | | | | 44,890 | |
| | |
Intel Corp. | | | 100,980 | | | | 3,685,770 | |
| | |
KLA Corp. | | | 3,570 | | | | 1,676,829 | |
| | |
Kulicke & Soffa Industries, Inc.(a) | | | 4,250 | | | | 176,843 | |
| | |
Lam Research Corp. | | | 4,250 | | | | 2,499,935 | |
| | |
Lattice Semiconductor Corp.* | | | 4,250 | | | | 236,342 | |
| | |
MACOM Technology Solutions Holdings, Inc.* (a) | | | 1,368 | | | | 96,499 | |
| | |
Magnachip Semiconductor Corp.* | | | 4,959 | | | | 36,647 | |
| | |
Marvell Technology, Inc. | | | 20,691 | | | | 977,029 | |
| | |
MaxLinear, Inc., Class A* | | | 340 | | | | 5,168 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 169 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Microchip Technology, Inc. | | | 12,750 | | | $ | 908,948 | |
| | |
Micron Technology, Inc. | | | 28,050 | | | | 1,875,703 | |
| | |
MKS Instruments, Inc.(a) | | | 3,570 | | | | 234,406 | |
| | |
Monolithic Power Systems, Inc. | | | 1,190 | | | | 525,671 | |
| | |
Navitas Semiconductor Corp., Class A* | | | 13,600 | | | | 71,264 | |
| | |
NVIDIA Corp. | | | 61,200 | | | | 24,957,360 | |
| | |
NXP Semiconductors NV | | | 7,650 | | | | 1,319,089 | |
| | |
ON Semiconductor Corp.* | | | 11,560 | | | | 724,118 | |
| | |
Onto Innovation, Inc.* | | | 2,890 | | | | 324,749 | |
| | |
PDF Solutions, Inc.* (a) | | | 342 | | | | 9,073 | |
| | |
Photronics, Inc.* | | | 14,877 | | | | 273,142 | |
| | |
Power Integrations, Inc. | | | 2,550 | | | | 176,791 | |
| | |
Qorvo, Inc.* | | | 2,720 | | | | 237,782 | |
| | |
QUALCOMM, Inc. | | | 33,150 | | | | 3,613,018 | |
| | |
Rambus, Inc.* (a) | | | 3,420 | | | | 185,809 | |
| | |
Semtech Corp.* (a) | | | 4,760 | | | | 66,450 | |
| | |
Silicon Laboratories, Inc.* (a) | | | 1,870 | | | | 172,377 | |
| | |
Skyworks Solutions, Inc. | | | 5,610 | | | | 486,611 | |
| | |
SMART Global Holdings, Inc.* (a) | | | 13,260 | | | | 181,662 | |
| | |
SolarEdge Technologies, Inc.* (a) | | | 1,368 | | | | 103,900 | |
| | |
Synaptics, Inc.* (a) | | | 9,690 | | | | 810,665 | |
| | |
Teradyne, Inc.(a) | | | 3,570 | | | | 297,274 | |
| | |
Texas Instruments, Inc. | | | 21,760 | | | | 3,090,138 | |
| | |
Ultra Clean Holdings, Inc.* | | | 4,760 | | | | 113,574 | |
| | |
Universal Display Corp.(a) | | | 2,565 | | | | 356,997 | |
| | |
Veeco Instruments, Inc.* (a) | | | 1,368 | | | | 32,750 | |
| | |
Wolfspeed, Inc.* (a) | | | 5,610 | | | | 189,842 | |
| | | | | | | 72,966,849 | |
|
Software – 8.5% | |
| | |
ACI Worldwide, Inc.* (a) | | | 4,959 | | | | 101,015 | |
| | |
Adeia, Inc.(a) | | | 20,740 | | | | 174,838 | |
| | |
Adobe, Inc.* | | | 11,220 | | | | 5,969,713 | |
| | |
Agilysys, Inc.* (a) | | | 342 | | | | 29,340 | |
| | |
Alarm.com Holdings, Inc.* (a) | | | 850 | | | | 43,461 | |
| | |
Alkami Technology, Inc.* (a) | | | 7,140 | | | | 128,163 | |
| | |
Altair Engineering, Inc., Class A* (a) | | | 3,400 | | | | 211,208 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Software – (continued) | |
| | |
Alteryx, Inc., Class A* (a) | | | 510 | | | $ | 16,325 | |
| | |
Amplitude, Inc., Class A* | | | 9,860 | | | | 98,206 | |
| | |
ANSYS, Inc.* | | | 2,380 | | | | 662,259 | |
| | |
Appfolio, Inc., Class A* | | | 1,360 | | | | 255,095 | |
| | |
Appian Corp., Class A* (a) | | | 680 | | | | 26,833 | |
| | |
AppLovin Corp., Class A* (a) | | | 6,800 | | | | 247,792 | |
| | |
Asana, Inc., Class A* (a) | | | 3,230 | | | | 59,658 | |
| | |
Aspen Technology, Inc.* | | | 855 | | | | 151,976 | |
| | |
Atlassian Corp., Class A* | | | 4,080 | | | | 737,011 | |
| | |
Aurora Innovation, Inc., Class A* (a) | | | 59,670 | | | | 104,423 | |
| | |
Autodesk, Inc.* | | | 5,100 | | | | 1,007,913 | |
| | |
Bentley Systems, Inc., Class B(a) | | | 6,630 | | | | 322,483 | |
| | |
BILL Holdings, Inc.* (a) | | | 2,052 | | | | 187,327 | |
| | |
Blackbaud, Inc.* | | | 2,736 | | | | 178,934 | |
| | |
BlackLine, Inc.* | | | 680 | | | | 33,388 | |
| | |
Box, Inc., Class A* | | | 4,959 | | | | 123,281 | |
| | |
Braze, Inc., Class A* (a) | | | 3,910 | | | | 166,488 | |
| | |
C3.ai, Inc., Class A* (a) | | | 4,420 | | | | 107,848 | |
| | |
Cadence Design Systems, Inc.* | | | 6,669 | | | | 1,599,560 | |
| | |
CCC Intelligent Solutions Holdings, Inc.* (a) | | | 12,410 | | | | 133,656 | |
| | |
Cerence, Inc.* (a) | | | 4,420 | | | | 67,670 | |
| | |
CommVault Systems, Inc.* | | | 2,736 | | | | 178,798 | |
| | |
Confluent, Inc., Class A* (a) | | | 6,800 | | | | 196,588 | |
| | |
Crowdstrike Holdings, Inc., Class A* | | | 5,610 | | | | 991,680 | |
| | |
Datadog, Inc., Class A* | | | 7,650 | | | | 623,245 | |
| | |
Digital Turbine, Inc.* | | | 8,500 | | | | 40,290 | |
| | |
DocuSign, Inc., Class A* | | | 3,230 | | | | 125,582 | |
| | |
Dolby Laboratories, Inc., Class A | | | 2,720 | | | | 220,157 | |
| | |
DoubleVerify Holdings, Inc.* (a) | | | 5,780 | | | | 160,857 | |
| | |
Dropbox, Inc., Class A* (a) | | | 10,370 | | | | 272,731 | |
| | |
Dynatrace, Inc.* | | | 6,460 | | | | 288,827 | |
| | |
Ebix, Inc.(a) | | | 5,950 | | | | 36,235 | |
| | |
Elastic NV* | | | 4,590 | | | | 344,434 | |
| | |
Enfusion, Inc., Class A* (a) | | | 684 | | | | 5,677 | |
| | |
EngageSmart, Inc.* (a) | | | 4,760 | | | | 107,814 | |
| | |
Envestnet, Inc.* | | | 1,530 | | | | 56,610 | |
See Accompanying Notes to the Financial Statements.
| | | | |
170 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – (continued) | |
| | |
Everbridge, Inc.* | | | 3,400 | | | $ | 70,074 | |
| | |
EverCommerce, Inc.* (a) | | | 8,500 | | | | 81,430 | |
| | |
Fair Isaac Corp.* | | | 684 | | | | 578,575 | |
| | |
Five9, Inc.* (a) | | | 4,250 | | | | 245,948 | |
| | |
Fortinet, Inc.* | | | 16,245 | | | | 928,727 | |
| | |
Freshworks, Inc., Class A* (a) | | | 9,690 | | | | 173,839 | |
| | |
Gen Digital, Inc. | | | 17,000 | | | | 283,220 | |
| | |
Gitlab, Inc., Class A* (a) | | | 3,910 | | | | 169,225 | |
| | |
Guidewire Software, Inc.* | | | 4,590 | | | | 413,697 | |
| | |
HashiCorp, Inc., Class A* | | | 5,780 | | | | 113,808 | |
| | |
HubSpot, Inc.* (a) | | | 1,360 | | | | 576,327 | |
| | |
Informatica, Inc., Class A* | | | 5,780 | | | | 110,860 | |
| | |
Intapp, Inc.* (a) | | | 684 | | | | 23,393 | |
| | |
InterDigital, Inc.(a) | | | 680 | | | | 51,170 | |
| | |
Intuit, Inc. | | | 7,140 | | | | 3,533,943 | |
| | |
Jamf Holding Corp.* (a) | | | 4,590 | | | | 73,715 | |
| | |
JFrog Ltd.* | | | 6,290 | | | | 141,462 | |
| | |
LiveRamp Holdings, Inc.* | | | 3,249 | | | | 89,867 | |
| | |
Manhattan Associates, Inc.* (a) | | | 2,040 | | | | 397,759 | |
| | |
Marathon Digital Holdings, Inc.* (a) | | | 7,480 | | | | 65,899 | |
| | |
Matterport, Inc.* (a) | | | 36,040 | | | | 73,522 | |
| | |
MeridianLink, Inc.* (a) | | | 4,930 | | | | 80,951 | |
| | |
Microsoft Corp. | | | 183,770 | | | | 62,134,475 | |
| | |
MicroStrategy, Inc., Class A* (a) | | | 342 | | | | 144,799 | |
| | |
Mitek Systems, Inc.* (a) | | | 855 | | | | 9,131 | |
| | |
Model N, Inc.* | | | 684 | | | | 16,484 | |
| | |
nCino, Inc.* (a) | | | 680 | | | | 19,108 | |
| | |
NCR Voyix Corp.* (a) | | | 26,690 | | | | 408,090 | |
| | |
New Relic, Inc.* | | | 2,550 | | | | 221,008 | |
| | |
Nutanix, Inc., Class A* (a) | | | 8,330 | | | | 301,463 | |
| | |
Olo, Inc., Class A* (a) | | | 12,410 | | | | 63,415 | |
| | |
ON24, Inc.(a) | | | 12,070 | | | | 74,230 | |
| | |
OneSpan, Inc.* (a) | | | 1,368 | | | | 10,807 | |
| | |
Oracle Corp. | | | 38,080 | | | | 3,937,472 | |
| | |
PagerDuty, Inc.* (a) | | | 7,820 | | | | 157,729 | |
| | |
Palantir Technologies, Inc., Class A* | | | 46,410 | | | | 686,868 | |
| | |
Palo Alto Networks, Inc.* | | | 7,650 | | | | 1,859,103 | |
| | |
Pegasystems, Inc. | | | 680 | | | | 29,063 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Software – (continued) | |
| | |
PowerSchool Holdings, Inc., Class A* (a) | | | 2,052 | | | $ | 40,876 | |
| | |
Procore Technologies, Inc.* | | | 3,060 | | | | 186,935 | |
| | |
Progress Software Corp.(a) | | | 680 | | | | 34,938 | |
| | |
PTC, Inc.* | | | 2,380 | | | | 334,200 | |
| | |
Q2 Holdings, Inc.* (a) | | | 4,250 | | | | 127,628 | |
| | |
Qualys, Inc.* (a) | | | 1,368 | | | | 209,236 | |
| | |
Rapid7, Inc.* (a) | | | 2,890 | | | | 134,356 | |
| | |
RingCentral, Inc., Class A* | | | 15,640 | | | | 415,711 | |
| | |
Riot Platforms, Inc.* (a) | | | 7,820 | | | | 76,480 | |
| | |
Roper Technologies, Inc. | | | 2,550 | | | | 1,245,853 | |
| | |
Salesforce, Inc.* | | | 23,800 | | | | 4,779,754 | |
| | |
Samsara, Inc., Class A* | | | 7,990 | | | | 184,329 | |
| | |
SentinelOne, Inc., Class A* (a) | | | 13,430 | | | | 209,911 | |
| | |
ServiceNow, Inc.* | | | 4,930 | | | | 2,868,521 | |
| | |
Smartsheet, Inc., Class A* | | | 6,120 | | | | 241,985 | |
| | |
SolarWinds Corp.* | | | 10,880 | | | | 100,205 | |
| | |
Splunk, Inc.* | | | 3,740 | | | | 550,378 | |
| | |
Sprinklr, Inc., Class A* (a) | | | 9,350 | | | | 127,066 | |
| | |
Sprout Social, Inc., Class A* (a) | | | 3,740 | | | | 161,867 | |
| | |
SPS Commerce, Inc.* | | | 1,190 | | | | 190,805 | |
| | |
Synopsys, Inc.* | | | 3,740 | | | | 1,755,706 | |
| | |
Tenable Holdings, Inc.* | | | 5,270 | | | | 221,920 | |
| | |
Teradata Corp.* | | | 2,890 | | | | 123,461 | |
| | |
Tyler Technologies, Inc.* | | | 1,190 | | | | 443,751 | |
| | |
UiPath, Inc., Class A* (a) | | | 15,470 | | | | 240,249 | |
| | |
Unity Software, Inc.* (a) | | | 3,910 | | | | 99,197 | |
| | |
Varonis Systems, Inc., Class B* (a) | | | 4,590 | | | | 154,408 | |
| | |
Verint Systems, Inc.* | | | 1,881 | | | | 35,382 | |
| | |
VMware, Inc., Class A* | | | 5,780 | | | | 841,857 | |
| | |
Workday, Inc., Class A* | | | 5,440 | | | | 1,151,702 | |
| | |
Workiva, Inc., Class A* (a) | | | 2,890 | | | | 251,690 | |
| | |
Yext, Inc.* | | | 11,560 | | | | 69,707 | |
| | |
Zoom Video Communications, Inc., Class A* (a) | | | 7,480 | | | | 448,650 | |
| | |
Zscaler, Inc.* | | | 1,710 | | | | 271,360 | |
| | | | | | | 113,276,119 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 171 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Specialized REITs – 0.8% | |
| | |
American Tower Corp., REIT | | | 12,070 | | | $ | 2,150,753 | |
| | |
Crown Castle, Inc., REIT | | | 9,860 | | | | 916,783 | |
| | |
CubeSmart, REIT | | | 6,669 | | | | 227,346 | |
| | |
Digital Realty Trust, Inc., REIT(a) | | | 6,800 | | | | 845,648 | |
| | |
EPR Properties, REIT(a) | | | 5,130 | | | | 219,051 | |
| | |
Equinix, Inc., REIT | | | 2,223 | | | | 1,621,990 | |
| | |
Extra Space Storage, Inc., REIT(a) | | | 5,697 | | | | 590,152 | |
| | |
Four Corners Property Trust, Inc., REIT(a) | | | 1,539 | | | | 32,781 | |
| | |
Gaming and Leisure Properties, Inc., REIT(a) | | | 6,669 | | | | 302,706 | |
| | |
Gladstone Land Corp., REIT(a) | | | 7,140 | | | | 97,532 | |
| | |
Iron Mountain, Inc., REIT(a) | | | 6,840 | | | | 404,039 | |
| | |
Lamar Advertising Co., Class A, REIT(a) | | | 2,736 | | | | 225,091 | |
| | |
National Storage Affiliates Trust, REIT(a) | | | 1,360 | | | | 38,787 | |
| | |
PotlatchDeltic Corp., REIT | | | 3,910 | | | | 167,543 | |
| | |
Public Storage, REIT(a) | | | 3,762 | | | | 898,027 | |
| | |
Rayonier, Inc., REIT(a) | | | 8,208 | | | | 207,170 | |
| | |
SBA Communications Corp., Class A, REIT | | | 3,060 | | | | 638,408 | |
| | |
Uniti Group, Inc., REIT(a) | | | 70,210 | | | | 322,966 | |
| | |
VICI Properties, Inc., Class A, REIT | | | 27,370 | | | | 763,623 | |
| | |
Weyerhaeuser Co., REIT | | | 15,300 | | | | 438,957 | |
| | | | | | | 11,109,353 | |
|
Specialty Retail – 2.5% | |
| | |
Aaron’s Co., Inc. (The) | | | 7,990 | | | | 59,206 | |
| | |
Abercrombie & Fitch Co., Class A* (a) | | | 3,910 | | | | 237,806 | |
| | |
Academy Sports & Outdoors, Inc.(a) | | | 17,442 | | | | 782,099 | |
| | |
Advance Auto Parts, Inc.(a) | | | 340 | | | | 17,690 | |
| | |
American Eagle Outfitters, Inc.(a) | | | 44,710 | | | | 781,084 | |
| | |
America’s Car-Mart, Inc.* (a) | | | 340 | | | | 22,773 | |
| | |
Arko Corp.(a) | | | 2,565 | | | | 19,366 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Specialty Retail – (continued) | |
| | |
Asbury Automotive Group, Inc.* (a) | | | 4,446 | | | $ | 850,831 | |
| | |
AutoNation, Inc.* (a) | | | 6,460 | | | | 840,317 | |
| | |
AutoZone, Inc.* | | | 459 | | | | 1,137,003 | |
| | |
Bath & Body Works, Inc. | | | 7,353 | | | | 218,016 | |
| | |
Best Buy Co., Inc.(a) | | | 6,840 | | | | 457,049 | |
| | |
Boot Barn Holdings, Inc.* (a) | | | 2,380 | | | | 165,410 | |
| | |
Buckle, Inc. (The)(a) | | | 6,498 | | | | 219,437 | |
| | |
Burlington Stores, Inc.* | | | 1,539 | | | | 186,265 | |
| | |
Caleres, Inc.(a) | | | 8,840 | | | | 226,127 | |
| | |
Camping World Holdings, Inc., Class A(a) | | | 10,370 | | | | 173,697 | |
| | |
CarMax, Inc.* (a) | | | 4,080 | | | | 249,247 | |
| | |
Carvana Co., Class A* (a) | | | 22,780 | | | | 615,060 | |
| | |
Chewy, Inc., Class A* (a) | | | 5,130 | | | | 99,163 | |
| | |
Chico’s FAS, Inc.* | | | 23,970 | | | | 179,296 | |
| | |
Designer Brands, Inc., Class A(a) | | | 18,020 | | | | 182,182 | |
| | |
Dick’s Sporting Goods, Inc.(a) | | | 2,550 | | | | 272,723 | |
| | |
Five Below, Inc.* (a) | | | 1,026 | | | | 178,503 | |
| | |
Floor & Decor Holdings, Inc., Class A* (a) | | | 3,400 | | | | 280,160 | |
| | |
Foot Locker, Inc.(a) | | | 18,020 | | | | 378,240 | |
| | |
GameStop Corp., Class A* (a) | | | 11,560 | | | | 159,181 | |
| | |
Gap, Inc. (The)(a) | | | 38,930 | | | | 498,304 | |
| | |
Group 1 Automotive, Inc.(a) | | | 3,400 | | | | 857,922 | |
| | |
Guess?, Inc.(a) | | | 6,669 | | | | 143,384 | |
| | |
Haverty Furniture Cos., Inc. | | | 340 | | | | 8,857 | |
| | |
Hibbett, Inc. | | | 1,360 | | | | 62,655 | |
| | |
Home Depot, Inc. (The) | | | 24,820 | | | | 7,066,006 | |
| | |
Lithia Motors, Inc., Class A(a) | | | 5,950 | | | | 1,441,150 | |
| | |
Lowe’s Cos., Inc. | | | 18,020 | | | | 3,434,071 | |
| | |
MarineMax, Inc.* (a) | | | 5,643 | | | | 154,505 | |
| | |
Monro, Inc.(a) | | | 513 | | | | 12,733 | |
| | |
Murphy USA, Inc. | | | 850 | | | | 308,287 | |
| | |
National Vision Holdings, Inc.* | | | 3,078 | | | | 47,832 | |
| | |
ODP Corp. (The)* | | | 9,350 | | | | 420,002 | |
| | |
O’Reilly Automotive, Inc.* | | | 1,530 | | | | 1,423,573 | |
| | |
Overstock.com, Inc.* (a) | | | 11,900 | | | | 185,640 | |
| | |
Penske Automotive Group, Inc.(a) | | | 1,190 | | | | 170,265 | |
See Accompanying Notes to the Financial Statements.
| | | | |
172 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Specialty Retail – (continued) | |
| | |
Petco Health & Wellness Co., Inc., Class A* | | | 5,780 | | | $ | 19,999 | |
| | |
RH* (a) | | | 1,020 | | | | 222,319 | |
| | |
Ross Stores, Inc. | | | 8,037 | | | | 932,051 | |
| | |
Sally Beauty Holdings, Inc.* (a) | | | 15,130 | | | | 128,605 | |
| | |
Shoe Carnival, Inc.(a) | | | 7,480 | | | | 171,142 | |
| | |
Signet Jewelers Ltd.(a) | | | 8,721 | | | | 608,987 | |
| | |
Sleep Number Corp.* (a) | | | 4,250 | | | | 69,147 | |
| | |
Sonic Automotive, Inc., Class A(a) | | | 4,760 | | | | 227,766 | |
| | |
TJX Cos., Inc. (The) | | | 28,050 | | | | 2,470,364 | |
| | |
Tractor Supply Co.(a) | | | 2,736 | | | | 526,844 | |
| | |
Ulta Beauty, Inc.* | | | 1,197 | | | | 456,428 | |
| | |
Upbound Group, Inc.(a) | | | 12,312 | | | | 320,851 | |
| | |
Urban Outfitters, Inc.* (a) | | | 10,370 | | | | 359,009 | |
| | |
Valvoline, Inc.(a) | | | 8,037 | | | | 238,458 | |
| | |
Victoria’s Secret & Co.* (a) | | | 18,020 | | | | 322,198 | |
| | |
Warby Parker, Inc., Class A* (a) | | | 9,860 | | | | 127,983 | |
| | |
Wayfair, Inc., Class A* (a) | | | 18,360 | | | | 782,320 | |
| | |
Williams-Sonoma, Inc.(a) | | | 2,223 | | | | 333,984 | |
| | | | | | | 33,541,572 | |
|
Technology Hardware, Storage & Peripherals – 5.1% | |
| | |
Apple, Inc. | | | 363,290 | | | | 62,039,033 | |
| | |
Dell Technologies, Inc., Class C | | | 6,290 | | | | 420,864 | |
| | |
Hewlett Packard Enterprise Co. | | | 40,853 | | | | 628,319 | |
| | |
HP, Inc. | | | 29,070 | | | | 765,413 | |
| | |
IonQ, Inc.* (a) | | | 12,070 | | | | 116,355 | |
| | |
NetApp, Inc. | | | 6,156 | | | | 448,034 | |
| | |
Pure Storage, Inc., Class A* | | | 11,050 | | | | 373,601 | |
| | |
Seagate Technology Holdings plc(a) | | | 6,120 | | | | 417,690 | |
| | |
Super Micro Computer, Inc.* | | | 10,260 | | | | 2,456,962 | |
| | |
Western Digital Corp.* | | | 9,690 | | | | 389,053 | |
| | |
Xerox Holdings Corp.(a) | | | 21,250 | | | | 272,850 | |
| | | | | | | 68,328,174 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Textiles, Apparel & Luxury Goods – 0.8% | |
| | |
Capri Holdings Ltd.* | | | 24,820 | | | $ | 1,270,288 | |
| | |
Carter’s, Inc.(a) | | | 9,180 | | | | 616,529 | |
| | |
Columbia Sportswear Co.(a) | | | 1,881 | | | | 138,818 | |
| | |
Crocs, Inc.* (a) | | | 12,996 | | | | 1,160,803 | |
| | |
Deckers Outdoor Corp.* | | | 855 | | | | 510,486 | |
| | |
Figs, Inc., Class A* | | | 10,200 | | | | 56,202 | |
| | |
G-III Apparel Group Ltd.* (a) | | | 11,730 | | | | 299,701 | |
| | |
Kontoor Brands, Inc.(a) | | | 9,010 | | | | 418,515 | |
| | |
Lululemon Athletica, Inc.* | | | 2,736 | | | | 1,076,561 | |
| | |
NIKE, Inc., Class B | | | 29,580 | | | | 3,039,937 | |
| | |
Oxford Industries, Inc.(a) | | | 1,026 | | | | 86,594 | |
| | |
PVH Corp. | | | 13,680 | | | | 1,017,108 | |
| | |
Ralph Lauren Corp., Class A | | | 2,550 | | | | 286,951 | |
| | |
Skechers USA, Inc., Class A* | | | 5,985 | | | | 288,597 | |
| | |
Steven Madden Ltd.(a) | | | 3,570 | | | | 117,060 | |
| | |
Tapestry, Inc. | | | 8,840 | | | | 243,630 | |
| | |
Under Armour, Inc., Class A* (a) | | | 29,580 | | | | 202,623 | |
| | |
Under Armour, Inc., Class C* (a) | | | 30,940 | | | | 198,944 | |
| | |
VF Corp.(a) | | | 8,840 | | | | 130,213 | |
| | |
Wolverine World Wide, Inc. | | | 10,370 | | | | 83,479 | |
| | | | | | | 11,243,039 | |
|
Tobacco – 0.5% | |
| | |
Altria Group, Inc. | | | 52,020 | | | | 2,089,644 | |
| | |
Philip Morris International, Inc. | | | 46,070 | | | | 4,107,601 | |
| | |
Universal Corp.(a) | | | 6,460 | | | | 290,700 | |
| | |
Vector Group Ltd.(a) | | | 27,030 | | | | 277,868 | |
| | | | | | | 6,765,813 | |
|
Trading Companies & Distributors – 0.9% | |
| | |
Air Lease Corp., Class A | | | 20,570 | | | | 712,339 | |
| | |
Applied Industrial Technologies, Inc.(a) | | | 2,210 | | | | 339,257 | |
| | |
Beacon Roofing Supply, Inc.* (a) | | | 12,070 | | | | 859,022 | |
| | |
BlueLinx Holdings, Inc.* (a) | | | 1,881 | | | | 133,758 | |
| | |
Boise Cascade Co. | | | 8,208 | | | | 769,500 | |
| | |
Core & Main, Inc., Class A* (a) | | | 19,380 | | | | 582,950 | |
| | |
DXP Enterprises, Inc.* | | | 2,040 | | | | 66,504 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 173 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Trading Companies & Distributors – (continued) | |
| | |
Fastenal Co. | | | 12,996 | | | $ | 758,187 | |
| | |
Ferguson plc | | | 4,420 | | | | 663,884 | |
| | |
FTAI Aviation Ltd.(a) | | | 2,040 | | | | 76,724 | |
| | |
GATX Corp.(a) | | | 2,210 | | | | 231,122 | |
| | |
GMS, Inc.* (a) | | | 10,200 | | | | 596,496 | |
| | |
H&E Equipment Services, Inc. | | | 6,800 | | | | 276,896 | |
| | |
Herc Holdings, Inc. | | | 5,610 | | | | 599,092 | |
| | |
McGrath RentCorp | | | 1,870 | | | | 188,122 | |
| | |
MRC Global, Inc.* | | | 17,340 | | | | 182,243 | |
| | |
MSC Industrial Direct Co., Inc., Class A(a) | | | 2,890 | | | | 273,828 | |
| | |
NOW, Inc.* | | | 11,223 | | | | 123,677 | |
| | |
Rush Enterprises, Inc., Class A | | | 11,730 | | | | 417,353 | |
| | |
Rush Enterprises, Inc., Class B(a) | | | 766 | | | | 30,977 | |
| | |
SiteOne Landscape Supply, Inc.* (a) | | | 2,223 | | | | 306,263 | |
| | |
Titan Machinery, Inc.* | | | 3,230 | | | | 80,233 | |
| | |
United Rentals, Inc. | | | 1,870 | | | | 759,725 | |
| | |
Veritiv Corp. | | | 2,550 | | | | 431,996 | |
| | |
Watsco, Inc.(a) | | | 684 | | | | 238,641 | |
| | |
WESCO International, Inc. | | | 9,747 | | | | 1,249,565 | |
| | |
WW Grainger, Inc. | | | 1,026 | | | | 748,806 | |
| | | | | | | 11,697,160 | |
|
Water Utilities – 0.1% | |
| | |
American States Water Co. | | | 2,394 | | | | 186,852 | |
| | |
American Water Works Co., Inc. | | | 4,275 | | | | 502,954 | |
| | |
California Water Service Group(a) | | | 3,420 | | | | 166,485 | |
| | |
Essential Utilities, Inc. | | | 4,420 | | | | 147,893 | |
| | |
Middlesex Water Co. | | | 513 | | | | 32,591 | |
| | |
SJW Group | | | 513 | | | | 32,052 | |
| | |
York Water Co. (The) | | | 2,040 | | | | 73,583 | |
| | | | | | | 1,142,410 | |
|
Wireless Telecommunication Services – 0.2% | |
| | |
Gogo, Inc.* (a) | | | 8,037 | | | | 84,389 | |
| | |
Shenandoah Telecommunications Co.(a) | | | 2,052 | | | | 48,550 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Telephone and Data Systems, Inc. | | | 21,760 | | | $ | 395,814 | |
| | |
T-Mobile US, Inc.* (a) | | | 16,150 | | | | 2,323,339 | |
| | | | | | | 2,852,092 | |
Total Common Stocks (Cost $854,268,940) | | | | 1,323,526,454 | |
| | Number of Warrants | | | | |
|
WARRANTS – 0.0%(d) | |
|
Oil, Gas & Consumable Fuels – 0.0%(d) | |
| | |
Occidental Petroleum Corp., expiring 8/3/2027, price 22.00* (Cost $21,117) | | | 4,266 | | | | 170,043 | |
| | Number of Rights | | | | |
|
RIGHTS – 0.0%(d) | |
|
Biotechnology – 0.0%(d) | |
| | |
Achillion Pharmaceuticals, Inc., CVR* ‡ | | | 44,344 | | | | 62,082 | |
|
Financial Services – 0.0% | |
| | |
Resolute Forest Products, Inc., CVR* ‡ | | | 6,734 | | | | — | |
|
Health Care Equipment & Supplies – 0.0% | |
| | |
ABIOMED, Inc., CVR* ‡ | | | 1,110 | | | | — | |
Total Rights (Cost $1,132) | | | | 62,082 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 12.5%(e) | |
|
CERTIFICATES OF DEPOSIT – 3.8% | |
| |
Barclays Bank plc, New York | | | | | |
(SOFR + 0.32%), 5.48%, 11/24/2023(f) | | $ | 2,000,000 | | | | 2,000,186 | |
| |
Citibank NA, New York | | | | | |
(SOFR + 0.40%), 5.62%, 12/15/2023(f) | | | 5,000,000 | | | | 5,000,540 | |
See Accompanying Notes to the Financial Statements.
| | | | |
174 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
CERTIFICATES OF DEPOSIT – (continued) | |
| | |
Credit Industriel et Commercial, London | | | | | | | | |
5.69%, 1/16/2024 | | $ | 3,000,000 | | | $ | 2,964,270 | |
| |
Mizuho Bank Ltd., New York | | | | | |
(SOFR + 0.40%), 5.71%, 3/12/2024(f) | | | 4,000,000 | | | | 4,001,152 | |
| | |
MUFG Bank Ltd., London Branch | | | | | | | | |
5.63%, 11/27/2023 | | | 4,000,000 | | | | 4,000,000 | |
| | |
National Westminster Bank PLC | | | | | | | | |
5.88%, 5/2/2024 | | | 4,000,000 | | | | 4,002,680 | |
| | |
Nordea Bank Abp, New York Branch | | | | | | | | |
(SOFR + 0.47%), 5.78%, 4/26/2024(f) | | | 4,000,000 | | | | 4,003,104 | |
| | |
Oversea-Chinese Banking Corp. Ltd., New York | | | | | | | | |
(SOFR + 0.37%), 5.68%, 11/16/2023(f) | | | 3,000,000 | | | | 3,000,000 | |
| | |
Royal Bank of Canada, New York | | | | | | | | |
(SOFR + 0.53%), 5.84%, 5/23/2024(f) | | | 3,000,000 | | | | 3,002,712 | |
| | |
Sumitomo Mitsui Trust Bank Ltd., New York | | | | | | | | |
(SOFR + 0.23%), 5.54%, 11/22/2023(f) | | | 4,000,000 | | | | 4,000,000 | |
| | |
Svenska Handelsbanken, New York 5.80%, 4/4/2024 | | | 1,000,000 | | | | 999,882 | |
(SOFR + 0.33%), 5.64%, 4/4/2024(f) | | | 1,000,000 | | | | 999,870 | |
| | |
The Sumitomo Bank Ltd., New York | | | | | | | | |
(SOFR + 0.47%), 5.60%, 1/9/2024(f) | | | 3,000,000 | | | | 3,001,839 | |
| | |
Toronto-Dominion Bank, New York 5.64%, 2/28/2024 | | | 2,000,000 | | | | 2,000,000 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CERTIFICATES OF DEPOSIT – (continued) | |
| | |
(US Federal Funds Effective Rate (continuous series) + 0.61%), 5.94%, 7/26/2024(f) | | $ | 4,000,000 | | | $ | 4,001,992 | |
| | |
Wells Fargo Bank (San Francisco) NA | | | | | | | | |
(SOFR + 0.37%), 5.62%, 12/12/2023(f) | | | 4,000,000 | | | | 4,000,290 | |
Total Certificates Of Deposit (Cost $50,967,462) | | | | 50,978,517 | |
| | |
| | | | | | | | |
|
COMMERCIAL PAPER – 0.4%(f) | |
| |
Bank of Montreal, Montreal | | | | | |
(SOFR + 0.35%), 5.66%, 11/9/2023 (Cost $6,000,000) | | | 6,000,000 | | | | 6,000,000 | |
|
INVESTMENT COMPANIES – 1.3% | |
| | |
BlackRock Liquidity FedFund, Institutional Shares 5.35%, 11/1/2023 | | | 2,000,000 | | | | 2,000,000 | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 | | | 5,000,000 | | | | 5,000,000 | |
| | |
Fidelity Government Portfolio, Institutional Class 5.34%, 11/1/2023 | | | 2,000,000 | | | | 2,000,000 | |
| | |
Goldman Sachs Financial Square Government Fund, Institutional Class 5.36%, 11/1/2023 | | | 5,000,000 | | | | 5,000,000 | |
| | |
Morgan Stanley Institutional Liquidity Fund – Government Portfolio 5.35%, 11/1/2023 | | | 3,000,000 | | | | 3,000,000 | |
Total Investment Companies (Cost $17,000,000) | | | | 17,000,000 | |
| | |
| | | | | | | | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 175 | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
REPURCHASE AGREEMENTS – 7.0% | |
| | |
BofA Securities, Inc., 5.77%, dated 10/31/2023, due 1/31/2024, repurchase price $6,088,473, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 6.13%, maturing 7/15/2024 – 11/15/2044; total market value $6,042,385 | | $ | 6,000,000 | | | $ | 6,000,000 | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $5,000,736, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $5,041,997 | | | 5,000,000 | | | | 5,000,000 | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $5,173,914, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $5,231,980 | | | 5,173,156 | | | | 5,173,156 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
REPURCHASE AGREEMENTS – (continued) | |
| | |
MetLife, Inc., 5.32%, dated 10/31/2023, due 11/1/2023, repurchase price $30,004,433, collateralized by various U.S. Treasury Securities, 0.00%, maturing 8/15/2041 – 11/15/2050; total market value $30,216,462 | | $ | 30,000,000 | | | $ | 30,000,000 | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $47,007,076, collateralized by various Common Stocks; total market value $52,052,944 | | | 47,000,000 | | | | 47,000,000 | |
Total Repurchase Agreements (Cost $93,173,156) | | | | 93,173,156 | |
Total Securities Lending Reinvestments (Cost $167,140,618) | | | | 167,151,673 | |
Total Investments – 111.6% (Cost $1,021,431,807) | | | | 1,490,910,252 | |
| |
Liabilities in excess of other assets – (11.6%) | | | | (154,899,191 | ) |
NET ASSETS – 100.0% | | | $ | 1,336,011,061 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $206,017,475, collateralized in the form of cash with a value of $167,151,893 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $36,526,260 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $5,775,820 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 4.50%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $209,453,973. |
See Accompanying Notes to the Financial Statements.
| | | | |
176 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar US Market Factor Tilt Index Fund (cont.)
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | Investment in affiliated company. Northern Trust Investments, Inc., the Investment Adviser of the Fund, is a subsidiary of Northern Trust Corporation. |
(d) | Represents less than 0.05% of net assets. |
(e) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $167,151,673. |
(f) | Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2023. |
Percentages shown are based on Net Assets.
Abbreviations
CVR – Contingent Value Rights
REIT – Real Estate Investment Trust
SOFR – Secured Overnight Financing Rate
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 524,557,601 | |
Aggregate gross unrealized depreciation | | | (54,592,043 | ) |
Net unrealized appreciation | | $ | 469,965,558 | |
Federal income tax cost | | $ | 1,020,214,088 | |
Investment in a company which was affiliated for the period ended October 31, 2023, was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Security | | Value October 31, 2022 | | | Purchases at Cost | | | Sales Proceeds | | | Shares October 31, 2023 | | | Value October 31, 2023 | | | Change in Unrealized Appreciation (Depreciation) | | | Dividend Income | | | Realized Loss | |
Northern Trust Corp. | | $ | 564,807 | | | $ | 210,086 | | | $ | 188,705 | | | | 6,970 | | | $ | 459,393 | | | $ | (110,312 | ) | | $ | 19,468 | | | $ | (16,483 | ) |
Futures Contracts
FlexShares® Morningstar US Market Factor Tilt Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | |
Russell 2000 E-Mini Index | | | 33 | | | | 12/15/2023 | | | | USD | | | $ | 2,752,860 | | | $ | (260,959 | ) |
S&P 500 E-Mini Index | | | 36 | | | | 12/15/2023 | | | | USD | | | | 7,582,050 | | | | (370,690 | ) |
S&P Midcap 400 E-Mini Index | | | 6 | | | | 12/15/2023 | | | | USD | | | | 1,425,060 | | | | (98,957 | ) |
| | | | | | | | | | | | | | | | | | $ | (730,606 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.1 | % |
Warrants | | | 0.0 | † |
Rights | | | 0.0 | † |
Securities Lending Reinvestments | | | 12.5 | |
Others(1) | | | (11.6 | ) |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 177 | |
Schedule of Investments
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.4% | |
|
Aerospace & Defense – 1.0% | |
| | |
Airbus SE | | | 9,087 | | | $ | 1,212,914 | |
| | |
Babcock International Group plc* (a) | | | 29,289 | | | | 138,893 | |
| | |
BAE Systems plc | | | 46,839 | | | | 627,478 | |
| | |
Bombardier, Inc., Class B* | | | 1,886 | | | | 60,442 | |
| | |
CAE, Inc.* | | | 4,716 | | | | 98,380 | |
| | |
Chemring Group plc | | | 15,334 | | | | 52,007 | |
| | |
Dassault Aviation SA | | | 369 | | | | 73,131 | |
| | |
Elbit Systems Ltd. | | | 412 | | | | 76,411 | |
| | |
Hensoldt AG | | | 800 | | | | 23,592 | |
| | |
INVISIO AB | | | 2,552 | | | | 38,282 | |
| | |
Kongsberg Gruppen ASA | | | 1,540 | | | | 62,859 | |
| | |
Leonardo SpA | | | 8,715 | | | | 131,129 | |
| | |
LISI SA | | | 880 | | | | 20,324 | |
| | |
Melrose Industries plc | | | 22,161 | | | | 125,582 | |
| | |
Montana Aerospace AG* (b) | | | 1,496 | | | | 17,951 | |
| | |
MTU Aero Engines AG | | | 702 | | | | 131,337 | |
| | |
QinetiQ Group plc | | | 14,473 | | | | 58,131 | |
| | |
Rheinmetall AG | | | 741 | | | | 211,787 | |
| | |
Rolls-Royce Holdings plc* | | | 130,611 | | | | 341,387 | |
| | |
Saab AB, Class B | | | 1,596 | | | | 81,710 | |
| | |
Safran SA | | | 5,148 | | | | 800,000 | |
| | |
Senior plc | | | 16,810 | | | | 31,903 | |
| | |
Singapore Technologies Engineering Ltd. | | | 17,900 | | | | 49,125 | |
| | |
Thales SA | | | 1,521 | | | | 223,711 | |
| | | | | | | 4,688,466 | |
|
Air Freight & Logistics – 0.7% | |
| | |
bpost SA(a) | | | 33,228 | | | | 179,825 | |
| | |
Cargojet, Inc. | | | 943 | | | | 53,663 | |
| | |
Cia de Distribucion Integral Logista Holdings SA | | | 2,419 | | | | 59,269 | |
| | |
Deutsche Post AG | | | 20,124 | | | | 781,925 | |
| | |
DSV A/S | | | 2,730 | | | | 406,715 | |
| | |
Freightways Group Ltd.(a) | | | 12,878 | | | | 55,804 | |
| | |
Hamakyorex Co. Ltd. | | | 3,900 | | | | 96,699 | |
| | |
ID Logistics Group SACA* | | | 81 | | | | 21,918 | |
| | |
InPost SA* | | | 3,608 | | | | 35,574 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Air Freight & Logistics – (continued) | |
| | |
International Distributions Services plc* | | | 14,455 | | | $ | 44,307 | |
| | |
Kerry Logistics Network Ltd. | | | 18,500 | | | | 15,676 | |
| | |
Konoike Transport Co. Ltd.(a) | | | 11,700 | | | | 153,275 | |
| | |
Mainfreight Ltd.(a) | | | 1,312 | | | | 43,681 | |
| | |
Mitsui-Soko Holdings Co. Ltd. | | | 7,800 | | | | 220,436 | |
| | |
Nippon Express Holdings, Inc. | | | 1,600 | | | | 81,550 | |
| | |
PostNL NV(a) | | | 25,992 | | | | 48,312 | |
| | |
Sankyu, Inc. | | | 1,333 | | | | 39,758 | |
| | |
SBS Holdings, Inc.(a) | | | 7,800 | | | | 137,309 | |
| | |
Senko Group Holdings Co. Ltd. | | | 46,800 | | | | 319,839 | |
| | |
SG Holdings Co. Ltd. | | | 8,000 | | | | 112,622 | |
| | |
Trancom Co. Ltd. | | | 900 | | | | 41,183 | |
| | |
Yamato Holdings Co. Ltd. | | | 6,200 | | | | 102,511 | |
| | | | | | | 3,051,851 | |
|
Automobile Components – 1.4% | |
| | |
Aisan Industry Co. Ltd.(a) | | | 12,000 | | | | 93,975 | |
| | |
Aisin Corp. | | | 4,100 | | | | 140,831 | |
| | |
ARB Corp. Ltd.(a) | | | 4,845 | | | | 89,482 | |
| | |
Brembo SpA | | | 1,435 | | | | 15,396 | |
| | |
Bridgestone Corp. | | | 11,700 | | | | 437,808 | |
| | |
CIE Automotive SA | | | 2,091 | | | | 53,177 | |
| | |
Cie Generale des Etablissements Michelin SCA | | | 14,274 | | | | 422,755 | |
| | |
Cie Plastic Omnium SE | | | 19,227 | | | | 215,423 | |
| | |
Continental AG | | | 2,223 | | | | 144,366 | |
| | |
Denso Corp. | | | 31,200 | | | | 453,131 | |
| | |
Dometic Group AB(c) | | | 5,962 | | | | 36,660 | |
| | |
Dowlais Group plc | | | 75,855 | | | | 92,046 | |
| | |
Eagle Industry Co. Ltd.(a) | | | 8,200 | | | | 88,419 | |
| | |
Exedy Corp. | | | 11,700 | | | | 193,371 | |
| | |
FCC Co. Ltd. | | | 11,700 | | | | 137,515 | |
| | |
Forvia SE* | | | 2,542 | | | | 42,561 | |
| | |
Gestamp Automocion SA(b) | | | 50,388 | | | | 184,919 | |
| | |
G-Tekt Corp. | | | 8,000 | | | | 92,284 | |
| | |
GUD Holdings Ltd.(a) | | | 6,543 | | | | 44,078 | |
| | |
Hella GmbH & Co. KGaA | | | 328 | | | | 24,927 | |
| | |
Johnson Electric Holdings Ltd.(a) | | | 136,500 | | | | 169,042 | |
| | |
JTEKT Corp. | | | 6,700 | | | | 54,261 | |
| | |
Koito Manufacturing Co. Ltd. | | | 5,000 | | | | 73,938 | |
See Accompanying Notes to the Financial Statements.
| | | | |
178 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Automobile Components – (continued) | |
| | |
KYB Corp.(a) | | | 7,800 | | | $ | 227,390 | |
| | |
Linamar Corp. | | | 1,066 | | | | 46,042 | |
| | |
Magna International, Inc.(a) | | | 5,499 | | | | 263,968 | |
| | |
Musashi Seimitsu Industry Co. Ltd. | | | 4,100 | | | | 38,849 | |
| | |
NHK Spring Co. Ltd. | | | 2,900 | | | | 20,240 | |
| | |
Nifco, Inc. | | | 2,400 | | | | 55,482 | |
| | |
Niterra Co. Ltd. | | | 2,700 | | | | 59,725 | |
| | |
NOK Corp.(a) | | | 4,100 | | | | 47,837 | |
| | |
Nokian Renkaat OYJ(a) | | | 8,364 | | | | 63,017 | |
| | |
Pacific Industrial Co. Ltd. | | | 23,400 | | | | 211,526 | |
| | |
Pirelli & C SpA(b) | | | 3,854 | | | | 17,114 | |
| | |
PWR Holdings Ltd. | | | 3,772 | | | | 23,453 | |
| | |
Schaeffler AG (Preference) | | | 55,380 | | | | 285,893 | |
| | |
Seiren Co. Ltd. | | | 4,100 | | | | 60,182 | |
| | |
Shoei Co. Ltd.(a) | | | 1,600 | | | | 21,056 | |
| | |
Stanley Electric Co. Ltd. | | | 4,100 | | | | 64,690 | |
| | |
Sumitomo Electric Industries Ltd. | | | 19,500 | | | | 202,024 | |
| | |
Tokai Rika Co. Ltd.(a) | | | 18,000 | | | | 278,596 | |
| | |
Topre Corp.(a) | | | 19,500 | | | | 206,530 | |
| | |
Toyo Tire Corp. | | | 4,500 | | | | 65,846 | |
| | |
Toyoda Gosei Co. Ltd. | | | 2,000 | | | | 39,156 | |
| | |
Toyota Boshoku Corp. | | | 2,700 | | | | 46,300 | |
| | |
TS Tech Co. Ltd. | | | 4,700 | | | | 52,091 | |
| | |
Valeo SE | | | 4,746 | | | | 62,406 | |
| | |
Vitesco Technologies Group AG* | | | 7,254 | | | | 706,175 | |
| | |
Yokohama Rubber Co. Ltd. (The) | | | 4,100 | | | | 74,625 | |
| | | | | | | 6,540,578 | |
|
Automobiles – 2.3% | |
| | |
Aston Martin Lagonda Global Holdings plc* (b) | | | 16,400 | | | | 43,542 | |
| | |
Bayerische Motoren Werke AG | | | 5,850 | | | | 541,856 | |
| | |
Bayerische Motoren Werke AG (Preference) | | | 1,198 | | | | 101,493 | |
| | |
Ferrari NV | | | 1,872 | | | | 564,920 | |
| | |
Honda Motor Co. Ltd. | | | 105,300 | | | | 1,047,472 | |
| | |
Isuzu Motors Ltd. | | | 15,600 | | | | 171,044 | |
| | |
Mazda Motor Corp. | | | 12,400 | | | | 116,594 | |
| | |
Mercedes-Benz Group AG | | | 16,575 | | | | 971,121 | |
| | |
Mitsubishi Motors Corp. | | | 13,500 | | | | 43,020 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Automobiles – (continued) | |
| | |
Nissan Motor Co. Ltd. | | | 42,900 | | | $ | 160,728 | |
| | |
Piaggio & C SpA | | | 48,438 | | | | 129,943 | |
| | |
PIERER Mobility AG | | | 440 | | | | 25,190 | |
| | |
Porsche Automobil Holding SE (Preference) | | | 3,432 | | | | 152,904 | |
| | |
Renault SA | | | 4,056 | | | | 141,692 | |
| | |
Stellantis NV | | | 46,176 | | | | 859,021 | |
| | |
Subaru Corp. | | | 12,100 | | | | 204,496 | |
| | |
Suzuki Motor Corp. | | | 7,800 | | | | 297,898 | |
| | |
Toyota Motor Corp.(a) | | | 261,300 | | | | 4,468,731 | |
| | |
Trigano SA | | | 2,769 | | | | 362,342 | |
| | |
Volkswagen AG (Preference) | | | 3,549 | | | | 374,492 | |
| | |
Volvo Car AB, Class B* (a) | | | 10,332 | | | | 35,428 | |
| | |
Yamaha Motor Co. Ltd.(a) | | | 7,800 | | | | 187,320 | |
| | | | | | | 11,001,247 | |
|
Banks – 11.2% | |
| | |
77 Bank Ltd. (The) | | | 27,300 | | | | 601,179 | |
| | |
ABN AMRO Bank NV, CVA(b) | | | 8,612 | | | | 115,470 | |
| | |
AIB Group plc | | | 18,788 | | | | 81,302 | |
| | |
Aktia Bank OYJ(a) | | | 19,734 | | | | 186,061 | |
| | |
Alior Bank SA* | | | 2,640 | | | | 41,461 | |
| | |
AMCO - Asset Management Co. SpA* ‡ (a) | | | 239 | | | | — | |
| | |
ANZ Group Holdings Ltd. | | | 43,329 | | | | 677,888 | |
| | |
Aozora Bank Ltd.(a) | | | 2,900 | | | | 58,710 | |
| | |
Awa Bank Ltd. (The)(a) | | | 15,600 | | | | 256,386 | |
| | |
Banca Popolare di Sondrio SpA | | | 154,596 | | | | 841,551 | |
| | |
Banco Bilbao Vizcaya Argentaria SA(a) | | | 123,318 | | | | 967,436 | |
| | |
Banco BPM SpA | | | 30,638 | | | | 156,190 | |
| | |
Banco Comercial Portugues SA, Class R* | | | 189,546 | | | | 58,021 | |
| | |
Banco de Sabadell SA | | | 119,847 | | | | 148,340 | |
| | |
Banco Santander SA(a) | | | 347,958 | | | | 1,274,766 | |
| | |
Bank Hapoalim BM | | | 25,779 | | | | 183,965 | |
| | |
Bank Leumi Le-Israel BM | | | 31,902 | | | | 204,949 | |
| | |
Bank Millennium SA* | | | 25,740 | | | | 44,712 | |
| | |
Bank of Cyprus Holdings plc | | | 129,480 | | | | 395,936 | |
| | |
Bank of East Asia Ltd. (The) | | | 24,600 | | | | 29,176 | |
| | |
Bank of Georgia Group plc | | | 13,104 | | | | 529,505 | |
| | |
Bank of Ireland Group plc | | | 21,021 | | | | 187,752 | |
| | |
Bank of Montreal | | | 15,171 | | | | 1,145,161 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 179 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Bank of Nova Scotia (The) | | | 25,194 | | | $ | 1,019,012 | |
| | |
Bank of Queensland Ltd.(a) | | | 13,492 | | | | 43,567 | |
| | |
Bank Polska Kasa Opieki SA | | | 3,907 | | | | 118,397 | |
| | |
Bankinter SA(a) | | | 13,940 | | | | 87,848 | |
| | |
Banque Cantonale de Geneve | | | 663 | | | | 163,920 | |
| | |
Banque Cantonale Vaudoise (Registered)(a) | | | 410 | | | | 46,224 | |
| | |
Barclays plc | | | 303,849 | | | | 485,217 | |
| | |
BAWAG Group AG(b) | | | 2,105 | | | | 93,316 | |
| | |
Bendigo & Adelaide Bank Ltd. | | | 16,482 | | | | 90,790 | |
| | |
Berner Kantonalbank AG (Registered) | | | 328 | | | | 85,780 | |
| | |
BNP Paribas SA | | | 22,464 | | | | 1,289,086 | |
| | |
BPER Banca | | | 28,167 | | | | 91,372 | |
| | |
CaixaBank SA | | | 80,145 | | | | 324,875 | |
| | |
Canadian Imperial Bank of Commerce | | | 19,865 | | | | 699,872 | |
| | |
Canadian Western Bank | | | 33,891 | | | | 670,862 | |
| | |
Chiba Bank Ltd. (The) | | | 17,000 | | | | 125,666 | |
| | |
Chugin Financial Group, Inc. | | | 66,300 | | | | 524,683 | |
| | |
Close Brothers Group plc(a) | | | 52,338 | | | | 506,171 | |
| | |
Commerzbank AG | | | 21,489 | | | | 230,546 | |
| | |
Commonwealth Bank of Australia | | | 24,726 | | | | 1,511,673 | |
| | |
Concordia Financial Group Ltd. | | | 30,921 | | | | 142,207 | |
| | |
Credit Agricole SA | | | 22,230 | | | | 267,350 | |
| | |
Credito Emiliano SpA | | | 26,715 | | | | 216,019 | |
| | |
Dah Sing Banking Group Ltd. | | | 149,440 | | | | 97,977 | |
| | |
Dah Sing Financial Holdings Ltd. | | | 62,400 | | | | 140,995 | |
| | |
Daishi Hokuetsu Financial Group, Inc. | | | 15,600 | | | | 403,275 | |
| | |
Danske Bank A/S | | | 13,845 | | | | 324,001 | |
| | |
DBS Group Holdings Ltd. | | | 27,356 | | | | 655,921 | |
| | |
DNB Bank ASA | | | 19,344 | | | | 348,555 | |
| | |
EQB, Inc. | | | 9,048 | | | | 448,538 | |
| | |
Erste Group Bank AG | | | 7,020 | | | | 250,430 | |
| | |
FIBI Holdings Ltd. | | | 533 | | | | 18,735 | |
| | |
FinecoBank Banca Fineco SpA | | | 8,736 | | | | 102,635 | |
| | |
First International Bank of Israel Ltd. (The) | | | 1,144 | | | | 38,882 | |
| | |
Fukuoka Financial Group, Inc. | | | 2,800 | | | | 73,159 | |
| | |
Graubuendner Kantonalbank | | | 7 | | | | 12,692 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Gunma Bank Ltd. (The) | | | 16,400 | | | $ | 78,619 | |
| | |
Hachijuni Bank Ltd. (The) | | | 15,500 | | | | 87,343 | |
| | |
Hang Seng Bank Ltd. | | | 11,700 | | | | 134,052 | |
| | |
Heartland Group Holdings Ltd.(a) | | | 222,222 | | | | 197,761 | |
| | |
Hirogin Holdings, Inc. | | | 9,200 | | | | 57,960 | |
| | |
Hokkoku Financial Holdings, Inc. | | | 1,300 | | | | 42,619 | |
| | |
Hokuhoku Financial Group, Inc. | | | 42,900 | | | | 495,300 | |
| | |
HSBC Holdings plc | | | 417,651 | | | | 3,001,768 | |
| | |
Hyakugo Bank Ltd. (The) | | | 85,800 | | | | 321,229 | |
| | |
ING Bank Slaski SA* | | | 1,281 | | | | 66,421 | |
| | |
ING Groep NV | | | 74,334 | | | | 945,052 | |
| | |
Intesa Sanpaolo SpA(a) | | | 331,695 | | | | 861,253 | |
| | |
Israel Discount Bank Ltd., Class A | | | 28,410 | | | | 124,650 | |
| | |
Iyogin Holdings, Inc. | | | 8,200 | | | | 58,504 | |
| | |
Japan Post Bank Co. Ltd. | | | 27,300 | | | | 252,279 | |
| | |
Judo Capital Holdings Ltd.* (a) | | | 31,857 | | | | 17,044 | |
| | |
Juroku Financial Group, Inc.(a) | | | 11,700 | | | | 312,886 | |
| | |
Jyske Bank A/S (Registered)* | | | 1,292 | | | | 90,789 | |
| | |
KBC Ancora | | | 803 | | | | 30,301 | |
| | |
KBC Group NV | | | 7,098 | | | | 389,384 | |
| | |
Keiyo Bank Ltd. (The) | | | 42,900 | | | | 192,908 | |
| | |
Kiyo Bank Ltd. (The)(a) | | | 21,700 | | | | 221,807 | |
| | |
Kyoto Financial Group, Inc. | | | 1,600 | | | | 89,907 | |
| | |
Kyushu Financial Group, Inc. | | | 12,000 | | | | 74,807 | |
| | |
Laurentian Bank of Canada(a) | | | 15,054 | | | | 275,434 | |
| | |
Liechtensteinische Landesbank AG | | | 1,025 | | | | 70,845 | |
| | |
Lloyds Banking Group plc | | | 1,377,207 | | | | 667,466 | |
| | |
Luzerner Kantonalbank AG (Registered) | | | 697 | | | | 54,685 | |
| | |
Mebuki Financial Group, Inc.(a) | | | 28,010 | | | | 84,153 | |
| | |
Mediobanca Banca di Credito Finanziario SpA(a) | | | 13,104 | | | | 156,100 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | 269,100 | | | | 2,233,542 | |
| | |
Mizrahi Tefahot Bank Ltd. | | | 3,510 | | | | 108,452 | |
| | |
Mizuho Financial Group, Inc. | | | 54,600 | | | | 917,721 | |
| | |
Musashino Bank Ltd. (The) | | | 11,700 | | | | 218,402 | |
| | |
Nanto Bank Ltd. (The) | | | 11,700 | | | | 208,591 | |
| | |
National Australia Bank Ltd. | | | 47,502 | | | | 843,629 | |
| | |
National Bank of Canada | | | 5,460 | | | | 339,104 | |
| | |
NatWest Group plc | | | 115,986 | | | | 250,804 | |
See Accompanying Notes to the Financial Statements.
| | | | |
180 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Nishi-Nippon Financial Holdings, Inc. | | | 46,800 | | | $ | 551,915 | |
| | |
Nordea Bank Abp | | | 71,799 | | | | 753,807 | |
| | |
Norion Bank AB* | | | 1,353 | | | | 4,366 | |
| | |
North Pacific Bank Ltd. | | | 101,400 | | | | 257,777 | |
| | |
Oberbank AG | | | 902 | | | | 60,637 | |
| | |
Ogaki Kyoritsu Bank Ltd. (The) | | | 15,600 | | | | 216,007 | |
| | |
Oversea-Chinese Banking Corp. Ltd. | | | 78,000 | | | | 721,901 | |
| | |
Powszechna Kasa Oszczednosci Bank Polski SA* | | | 15,902 | | | | 164,228 | |
| | |
Raiffeisen Bank International AG* | | | 1,107 | | | | 15,995 | |
| | |
Resona Holdings, Inc. | | | 46,800 | | | | 248,300 | |
| | |
Ringkjoebing Landbobank A/S | | | 492 | | | | 66,923 | |
| | |
Royal Bank of Canada | | | 20,814 | | | | 1,660,622 | |
| | |
San-In Godo Bank Ltd. (The) | | | 54,600 | | | | 372,785 | |
| | |
Santander Bank Polska SA* | | | 836 | | | | 90,544 | |
| | |
Senshu Ikeda Holdings, Inc.(a) | | | 101,400 | | | | 236,351 | |
| | |
Seven Bank Ltd. | | | 28,700 | | | | 56,530 | |
| | |
Shiga Bank Ltd. (The) | | | 16,600 | | | | 435,155 | |
| | |
Shizuoka Financial Group, Inc. | | | 13,100 | | | | 110,417 | |
| | |
Skandinaviska Enskilda Banken AB, Class A | | | 35,763 | | | | 397,877 | |
| | |
Skandinaviska Enskilda Banken AB, Class C | | | 684 | | | | 7,849 | |
| | |
Societe Generale SA | | | 15,561 | | | | 347,792 | |
| | |
Spar Nord Bank A/S | | | 25,311 | | | | 382,818 | |
| | |
SpareBank 1 Nord Norge | | | 32,253 | | | | 272,535 | |
| | |
Sparebank 1 Oestlandet | | | 1,329 | | | | 14,751 | |
| | |
SpareBank 1 SMN | | | 3,103 | | | | 37,608 | |
| | |
SpareBank 1 Sorost-Norge | | | 25,506 | | | | 135,616 | |
| | |
SpareBank 1 SR-Bank ASA | | | 4,796 | | | | 52,031 | |
| | |
Sparebanken Vest | | | 32,136 | | | | 294,559 | |
| | |
St Galler Kantonalbank AG (Registered) | | | 41 | | | | 22,233 | |
| | |
Standard Chartered plc | | | 47,814 | | | | 365,525 | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | 28,600 | | | | 1,363,478 | |
| | |
Sumitomo Mitsui Trust Holdings, Inc. | | | 7,800 | | | | 288,937 | |
| | |
Suruga Bank Ltd.(a) | | | 67,100 | | | | 284,448 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Svenska Handelsbanken AB, Class A | | | 31,590 | | | $ | 268,607 | |
| | |
Svenska Handelsbanken AB, Class B(a) | | | 908 | | | | 9,346 | |
| | |
Swedbank AB, Class A | | | 18,681 | | | | 305,563 | |
| | |
Sydbank A/S | | | 19,656 | | | | 851,783 | |
| | |
TBC Bank Group plc | | | 14,586 | | | | 475,228 | |
| | |
Tokyo Kiraboshi Financial Group, Inc.(a) | | | 11,700 | | | | 340,312 | |
| | |
Toronto-Dominion Bank (The) | | | 38,844 | | | | 2,167,373 | |
| | |
Unicaja Banco SA(a) (b) | | | 441,129 | | | | 457,880 | |
| | |
UniCredit SpA | | | 37,947 | | | | 947,598 | |
| | |
United Overseas Bank Ltd. | | | 31,226 | | | | 615,836 | |
| | |
Valiant Holding AG (Registered) | | | 5,499 | | | | 598,210 | |
| | |
Virgin Money UK plc | | | 30,176 | | | | 54,541 | |
| | |
Walliser Kantonalbank (Registered) | | | 485 | | | | 58,090 | |
| | |
Westpac Banking Corp.(a) | | | 50,739 | | | | 661,783 | |
| | |
Yamaguchi Financial Group, Inc. | | | 4,100 | | | | 37,198 | |
| | |
Zuger Kantonalbank AG | | | 10 | | | | 86,369 | |
| | | | | | | 52,737,770 | |
|
Beverages – 1.0% | |
| | |
Anheuser-Busch InBev SA/NV | | | 15,483 | | | | 877,683 | |
| | |
Asahi Group Holdings Ltd. | | | 6,700 | | | | 240,491 | |
| | |
Britvic plc | | | 3,520 | | | | 35,794 | |
| | |
Budweiser Brewing Co. APAC Ltd.(b) | | | 22,600 | | | | 42,978 | |
| | |
C&C Group plc(a) | | | 27,840 | | | | 47,025 | |
| | |
Carlsberg A/S, Class B | | | 1,521 | | | | 180,934 | |
| | |
Coca-Cola Europacific Partners plc(a) | | | 3,092 | | | | 180,913 | |
| | |
Coca-Cola HBC AG | | | 3,806 | | | | 98,464 | |
| | |
Davide Campari-Milano NV(a) | | | 9,602 | | | | 105,857 | |
| | |
Diageo plc | | | 33,306 | | | | 1,255,699 | |
| | |
Fevertree Drinks plc | | | 5,658 | | | | 68,932 | |
| | |
Heineken Holding NV | | | 1,391 | | | | 105,567 | |
| | |
Heineken NV | | | 3,627 | | | | 324,871 | |
| | |
Ito En Ltd. | | | 800 | | | | 25,868 | |
| | |
Kirin Holdings Co. Ltd. | | | 11,700 | | | | 163,744 | |
| | |
Pernod Ricard SA | | | 3,042 | | | | 538,578 | |
| | |
Primo Water Corp. | | | 8,385 | | | | 109,263 | |
| | |
Remy Cointreau SA | | | 398 | | | | 45,077 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 181 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Beverages – (continued) | |
| | |
Royal Unibrew A/S | | | 836 | | | $ | 60,356 | |
| | |
Sapporo Holdings Ltd. | | | 1,900 | | | | 66,543 | |
| | |
Suntory Beverage & Food Ltd. | | | 1,800 | | | | 53,223 | |
| | |
Takara Holdings, Inc. | | | 4,100 | | | | 33,868 | |
| | |
Treasury Wine Estates Ltd. | | | 8,668 | | | | 66,407 | |
| | | | | | | 4,728,135 | |
|
Biotechnology – 0.5% | |
| | |
Argenx SE* | | | 897 | | | | 421,064 | |
| | |
Bavarian Nordic A/S* (a) | | | 3,730 | | | | 70,914 | |
| | |
BioGaia AB, Class B | | | 5,670 | | | | 50,546 | |
| | |
BoneSupport Holding AB* (b) | | | 2,665 | | | | 34,634 | |
| | |
Clinuvel Pharmaceuticals Ltd.(a) | | | 1,368 | | | | 12,724 | |
| | |
CSL Ltd. | | | 7,137 | | | | 1,049,941 | |
| | |
Galapagos NV* (a) | | | 2,964 | | | | 97,842 | |
| | |
Genmab A/S* | | | 975 | | | | 274,770 | |
| | |
Genus plc | | | 3,640 | | | | 94,435 | |
| | |
Grifols SA* | | | 6,478 | | | | 72,478 | |
| | |
Idorsia Ltd.* (a) | | | 7,462 | | | | 14,079 | |
| | |
Imugene Ltd.* | | | 411,693 | | | | 11,208 | |
| | |
Nykode Therapeutics ASA* | | | 11,562 | | | | 17,770 | |
| | |
PeptiDream, Inc.* | | | 2,500 | | | | 18,002 | |
| | |
Pharma Mar SA | | | 824 | | | | 28,045 | |
| | |
PureTech Health plc* | | | 12,751 | | | | 23,457 | |
| | |
Swedish Orphan Biovitrum AB* | | | 3,561 | | | | 73,115 | |
| | |
Takara Bio, Inc. | | | 400 | | | | 3,500 | |
| | |
Telix Pharmaceuticals Ltd.* | | | 4,018 | | | | 22,489 | |
| | |
Valneva SE* (a) | | | 3,485 | | | | 19,707 | |
| | |
Vitrolife AB(a) | | | 880 | | | | 11,429 | |
| | |
Zealand Pharma A/S, Class A* | | | 2,519 | | | | 104,451 | |
| | | | | | | 2,526,600 | |
|
Broadline Retail – 0.6% | |
| | |
Allegro.eu SA* (b) | | | 6,278 | | | | 44,917 | |
| | |
ASKUL Corp.(a) | | | 1,000 | | | | 12,922 | |
| | |
B&M European Value Retail SA | | | 16,102 | | | | 103,322 | |
| | |
Belluna Co. Ltd.(a) | | | 15,600 | | | | 63,041 | |
| | |
Boozt AB* (b) | | | 2,508 | | | | 17,509 | |
| | |
Canadian Tire Corp. Ltd., Class A(a) | | | 1,108 | | | | 106,758 | |
| | |
Dollarama, Inc.(a) | | | 3,939 | | | | 268,701 | |
| | |
Europris ASA(b) | | | 12,997 | | | | 73,584 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Broadline Retail – (continued) | |
| | |
Harvey Norman Holdings Ltd.(a) | | | 17,952 | | | $ | 41,714 | |
| | |
Isetan Mitsukoshi Holdings Ltd. | | | 5,000 | | | | 55,928 | |
| | |
Izumi Co. Ltd. | | | 1,300 | | | | 32,645 | |
| | |
J Front Retailing Co. Ltd. | | | 4,100 | | | | 38,727 | |
| | |
Mercari, Inc.* (a) | | | 1,900 | | | | 37,650 | |
| | |
Next plc | | | 2,106 | | | | 175,923 | |
| | |
Pan Pacific International Holdings Corp. | | | 7,800 | | | | 149,696 | |
| | |
Prosus NV* | | | 22,659 | | | | 633,013 | |
| | |
Rakuten Group, Inc. | | | 35,100 | | | | 129,048 | |
| | |
Ryohin Keikaku Co. Ltd. | | | 6,000 | | | | 84,050 | |
| | |
Seria Co. Ltd. | | | 1,000 | | | | 13,853 | |
| | |
Takashimaya Co. Ltd. | | | 4,300 | | | | 58,007 | |
| | |
THG plc, Class B* (a) | | | 50,904 | | | | 43,189 | |
| | |
Tokmanni Group Corp.(a) | | | 14,664 | | | | 197,623 | |
| | |
Warehouse Group Ltd. (The)(a) | | | 30,712 | | | | 30,726 | |
| | |
Wesfarmers Ltd. | | | 15,834 | | | | 506,478 | |
| | | | | | | 2,919,024 | |
|
Building Products – 1.0% | |
| | |
AGC, Inc. | | | 4,800 | | | | 161,992 | |
| | |
Arbonia AG | | | 3,837 | | | | 32,634 | |
| | |
Assa Abloy AB, Class B | | | 14,118 | | | | 300,110 | |
| | |
Belimo Holding AG (Registered) | | | 123 | | | | 51,495 | |
| | |
Bunka Shutter Co. Ltd. | | | 21,200 | | | | 177,501 | |
| | |
Carel Industries SpA(b) | | | 840 | | | | 17,474 | |
| | |
Central Glass Co. Ltd. | | | 7,800 | | | | 146,374 | |
| | |
Cie de Saint-Gobain SA | | | 11,076 | | | | 601,757 | |
| | |
Daikin Industries Ltd. | | | 4,200 | | | | 599,861 | |
| | |
dormakaba Holding AG | | | 126 | | | | 57,320 | |
| | |
Fletcher Building Ltd.(a) | | | 3,362 | | | | 8,448 | |
| | |
Forbo Holding AG (Registered) | | | 41 | | | | 45,052 | |
| | |
Geberit AG (Registered) | | | 468 | | | | 216,914 | |
| | |
Genuit Group plc | | | 15,480 | | | | 49,872 | |
| | |
Inwido AB | | | 20,748 | | | | 211,516 | |
| | |
James Halstead plc | | | 18,023 | | | | 41,881 | |
| | |
Kingspan Group plc | | | 2,341 | | | | 157,077 | |
| | |
Lindab International AB | | | 4,346 | | | | 66,789 | |
| | |
Lixil Corp. | | | 6,000 | | | | 65,410 | |
| | |
Munters Group AB(b) | | | 4,428 | | | | 53,821 | |
| | |
Nibe Industrier AB, Class B(a) | | | 22,581 | | | | 129,714 | |
| | |
Nichias Corp.(a) | | | 20,300 | | | | 398,909 | |
| | |
Nichiha Corp. | | | 11,700 | | | | 228,677 | |
See Accompanying Notes to the Financial Statements.
| | | | |
182 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Building Products – (continued) | |
| | |
Nitto Boseki Co. Ltd. | | | 1,900 | | | $ | 42,154 | |
| | |
Reliance Worldwide Corp. Ltd.(a) | | | 13,860 | | | | 30,626 | |
| | |
ROCKWOOL A/S, Class A | | | 88 | | | | 19,441 | |
| | |
ROCKWOOL A/S, Class B | | | 174 | | | | 38,637 | |
| | |
Sanwa Holdings Corp. | | | 5,400 | | | | 71,973 | |
| | |
Schweiter Technologies AG | | | 56 | | | | 31,260 | |
| | |
Sekisui Jushi Corp.(a) | | | 11,700 | | | | 189,045 | |
| | |
Systemair AB | | | 4,018 | | | | 22,009 | |
| | |
Takara Standard Co. Ltd.(a) | | | 19,500 | | | | 235,115 | |
| | |
Takasago Thermal Engineering Co. Ltd. | | | 4,100 | | | | 80,378 | |
| | |
TOTO Ltd. | | | 3,000 | | | | 71,769 | |
| | |
Uponor OYJ | | | 3,440 | | | | 103,846 | |
| | |
Volution Group plc | | | 11,378 | | | | 50,063 | |
| | | | | | | 4,806,914 | |
|
Capital Markets – 3.0% | |
| | |
3i Group plc | | | 19,968 | | | | 468,733 | |
| | |
abrdn plc | | | 16,031 | | | | 30,473 | |
| | |
AJ Bell plc | | | 21,520 | | | | 66,119 | |
| | |
Allfunds Group plc | | | 4,048 | | | | 20,615 | |
| | |
Alpha Group International plc | | | 1,804 | | | | 34,149 | |
| | |
Altshuler Shaham Finance Ltd.(a) | | | 22,509 | | | | 25,260 | |
| | |
Amundi SA(b) | | | 1,312 | | | | 68,258 | |
| | |
Anima Holding SpA(b) | | | 65,754 | | | | 268,000 | |
| | |
Ashmore Group plc | | | 22,554 | | | | 46,389 | |
| | |
ASX Ltd.(a) | | | 3,471 | | | | 123,355 | |
| | |
Avanza Bank Holding AB(a) | | | 2,704 | | | | 45,500 | |
| | |
Azimut Holding SpA | | | 2,501 | | | | 52,554 | |
| | |
Banca Generali SpA | | | 1,397 | | | | 45,214 | |
| | |
Brederode SA(a) | | | 285 | | | | 25,305 | |
| | |
Bridgepoint Group plc(b) | | | 16,760 | | | | 36,912 | |
| | |
Brookfield Asset Management Ltd., Class A | | | 5,265 | | | | 150,754 | |
| | |
Brookfield Corp., Class A(a) | | | 29,914 | | | | 870,524 | |
| | |
Bure Equity AB | | | 968 | | | | 19,286 | |
| | |
CI Financial Corp. | | | 51,441 | | | | 465,776 | |
| | |
Cie Financiere Tradition SA | | | 615 | | | | 78,391 | |
| | |
Daiwa Securities Group, Inc. | | | 27,300 | | | | 155,748 | |
| | |
Deutsche Bank AG (Registered) | | | 43,563 | | | | 476,853 | |
| | |
Deutsche Boerse AG | | | 2,808 | | | | 460,642 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
EFG International AG | | | 1,680 | | | $ | 20,085 | |
| | |
EQT AB(a) | | | 4,756 | | | | 86,371 | |
| | |
Euronext NV(b) | | | 1,394 | | | | 96,954 | |
| | |
Fairfax India Holdings Corp.* (a) (b) | | | 4,510 | | | | 54,977 | |
| | |
flatexDEGIRO AG* | | | 4,400 | | | | 44,424 | |
| | |
Flow Traders Ltd.(a) | | | 11,193 | | | | 204,321 | |
| | |
Gimv NV(a) | | | 6,456 | | | | 249,076 | |
| | |
GMO Financial Holdings, Inc.(a) | | | 8,200 | | | | 36,981 | |
| | |
Hargreaves Lansdown plc | | | 5,061 | | | | 43,394 | |
| | |
Hong Kong Exchanges & Clearing Ltd. | | | 17,358 | | | | 610,057 | |
| | |
HUB24 Ltd. | | | 4,532 | | | | 86,743 | |
| | |
iFAST Corp. Ltd. | | | 16,400 | | | | 79,004 | |
| | |
IG Group Holdings plc | | | 8,448 | | | | 65,403 | |
| | |
IGM Financial, Inc.(a) | | | 2,200 | | | | 49,475 | |
| | |
Impax Asset Management Group plc | | | 2,132 | | | | 9,960 | |
| | |
Insignia Financial Ltd.(a) | | | 223,002 | | | | 290,859 | |
| | |
IntegraFin Holdings plc(b) | | | 15,498 | | | | 41,148 | |
| | |
Intermediate Capital Group plc | | | 6,435 | | | | 101,863 | |
| | |
Investec plc | | | 16,636 | | | | 92,073 | |
| | |
IP Group plc | | | 362,154 | | | | 192,701 | |
| | |
JAFCO Group Co. Ltd. | | | 5,000 | | | | 53,452 | |
| | |
Japan Exchange Group, Inc. | | | 7,800 | | | | 152,683 | |
| | |
JTC plc(b) | | | 7,558 | | | | 58,558 | |
| | |
Julius Baer Group Ltd. | | | 4,446 | | | | 261,860 | |
| | |
Jupiter Fund Management plc | | | 181,233 | | | | 172,635 | |
| | |
Kingkey Financial International Holdings Ltd.* (a) | | | 410,000 | | | | 45,587 | |
| | |
Leonteq AG | | | 2,964 | | | | 126,859 | |
| | |
London Stock Exchange Group plc | | | 6,162 | | | | 619,119 | |
| | |
Macquarie Group Ltd. | | | 5,304 | | | | 540,607 | |
| | |
Magellan Financial Group Ltd. | | | 7,995 | | | | 32,853 | |
| | |
Man Group plc | | | 32,340 | | | | 86,138 | |
| | |
Matsui Securities Co. Ltd. | | | 8,200 | | | | 40,609 | |
| | |
Monex Group, Inc.(a) | | | 12,300 | | | | 53,360 | |
| | |
Ninety One plc(a) | | | 15,252 | | | | 29,260 | |
| | |
Nomura Holdings, Inc. | | | 66,300 | | | | 253,870 | |
| | |
Nordnet AB publ | | | 2,420 | | | | 34,115 | |
| | |
Okasan Securities Group, Inc. | | | 78,000 | | | | 348,681 | |
| | |
Onex Corp. | | | 1,394 | | | | 78,042 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 183 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
Partners Group Holding AG | | | 312 | | | $ | 328,028 | |
| | |
Perpetual Ltd.(a) | | | 5,289 | | | | 64,128 | |
| | |
Pinnacle Investment Management Group Ltd.(a) | | | 10,281 | | | | 50,383 | |
| | |
Quilter plc(a) (b) | | | 475,137 | | | | 460,667 | |
| | |
Rathbones Group plc | | | 3,608 | | | | 65,584 | |
| | |
Ratos AB, Class B | | | 71,097 | | | | 197,395 | |
| | |
SBI Holdings, Inc. | | | 4,800 | | | | 102,279 | |
| | |
Schroders plc | | | 12,054 | | | | 54,017 | |
| | |
Singapore Exchange Ltd. | | | 12,300 | | | | 85,020 | |
| | |
Sprott, Inc.(a) | | | 1,056 | | | | 30,587 | |
| | |
St James’s Place plc | | | 7,920 | | | | 61,469 | |
| | |
Swissquote Group Holding SA (Registered) | | | 205 | | | | 39,173 | |
| | |
Tamburi Investment Partners SpA | | | 6,642 | | | | 55,533 | |
| | |
Tel Aviv Stock Exchange Ltd.* | | | 4,141 | | | | 18,425 | |
| | |
Tikehau Capital SCA(a) | | | 1,672 | | | | 34,462 | |
| | |
TMX Group Ltd. | | | 4,180 | | | | 86,957 | |
| | |
Tokai Tokyo Financial Holdings, Inc. | | | 28,700 | | | | 96,649 | |
| | |
TP ICAP Group plc | | | 265,473 | | | | 506,079 | |
| | |
UBS Group AG (Registered) | | | 63,882 | | | | 1,489,562 | |
| | |
UOB-Kay Hian Holdings Ltd. | | | 5,767 | | | | 5,514 | |
| | |
Van Lanschot Kempen NV, CVA | | | 13,494 | | | | 361,571 | |
| | |
Vontobel Holding AG (Registered) | | | 339 | | | | 19,743 | |
| | |
VZ Holding AG | | | 285 | | | | 27,935 | |
| | |
WealthNavi, Inc.* (a) | | | 2,400 | | | | 17,416 | |
| | |
XTB SA(b) | | | 13,760 | | | | 106,841 | |
| | |
Yangzijiang Financial Holding Ltd. | | | 881,400 | | | | 205,867 | |
| | | | | | | 14,050,251 | |
|
Chemicals – 3.1% | |
| | |
ADEKA Corp. | | | 2,300 | | | | 37,952 | |
| | |
Aica Kogyo Co. Ltd. | | | 1,500 | | | | 34,250 | |
| | |
Air Liquide SA | | | 7,683 | | | | 1,312,992 | |
| | |
Air Water, Inc. | | | 4,100 | | | | 51,343 | |
| | |
Akzo Nobel NV | | | 2,730 | | | | 182,544 | |
| | |
Arkema SA | | | 1,521 | | | | 142,088 | |
| | |
Asahi Kasei Corp. | | | 35,100 | | | | 214,014 | |
| | |
ASAHI YUKIZAI Corp. | | | 4,000 | | | | 96,669 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – (continued) | |
| | |
BASF SE | | | 18,252 | | | $ | 839,893 | |
| | |
Borregaard ASA | | | 1,692 | | | | 22,930 | |
| | |
C Uyemura & Co. Ltd. | | | 600 | | | | 32,329 | |
| | |
Chr Hansen Holding A/S | | | 1,546 | | | | 105,200 | |
| | |
Clariant AG (Registered) | | | 5,002 | | | | 70,739 | |
| | |
Corbion NV | | | 3,321 | | | | 57,323 | |
| | |
Covestro AG* (b) | | | 2,730 | | | | 137,644 | |
| | |
Croda International plc | | | 2,262 | | | | 120,168 | |
| | |
Daicel Corp. | | | 8,900 | | | | 74,899 | |
| | |
Denka Co. Ltd. | | | 1,400 | | | | 25,084 | |
| | |
DIC Corp. | | | 2,899 | | | | 45,319 | |
| | |
DSM-Firmenich AG | | | 3,198 | | | | 289,319 | |
| | |
Elementis plc* | | | 41,976 | | | | 60,308 | |
| | |
Elkem ASA(b) | | | 5,870 | | | | 9,079 | |
| | |
EMS-Chemie Holding AG (Registered)(a) | | | 126 | | | | 85,841 | |
| | |
Essentra plc | | | 16,940 | | | | 30,546 | |
| | |
Evonik Industries AG | | | 4,160 | | | | 76,334 | |
| | |
FUCHS SE | | | 711 | | | | 23,823 | |
| | |
FUCHS SE (Preference) | | | 1,182 | | | | 47,876 | |
| | |
Fujimori Kogyo Co. Ltd. | | | 4,000 | | | | 99,838 | |
| | |
Fuso Chemical Co. Ltd. | | | 1,100 | | | | 29,453 | |
| | |
Givaudan SA (Registered) | | | 117 | | | | 388,264 | |
| | |
Grupa Azoty SA* | | | 3,720 | | | | 19,421 | |
| | |
Hexpol AB | | | 5,784 | | | | 51,096 | |
| | |
ICL Group Ltd. | | | 18,163 | | | | 87,997 | |
| | |
Incitec Pivot Ltd. | | | 36,784 | | | | 63,814 | |
| | |
Israel Corp. Ltd.* | | | 104 | | | | 22,396 | |
| | |
JCU Corp. | | | 1,400 | | | | 30,090 | |
| | |
Johnson Matthey plc | | | 4,320 | | | | 78,317 | |
| | |
JSR Corp. | | | 3,100 | | | | 82,267 | |
| | |
K+S AG (Registered) | | | 4,961 | | | | 83,219 | |
| | |
Kaneka Corp. | | | 1,300 | | | | 31,495 | |
| | |
Kansai Paint Co. Ltd. | | | 5,300 | | | | 76,957 | |
| | |
Kanto Denka Kogyo Co. Ltd.(a) | | | 19,500 | | | | 101,720 | |
| | |
Kemira OYJ | | | 2,992 | | | | 48,324 | |
| | |
KH Neochem Co. Ltd.(a) | | | 11,700 | | | | 175,139 | |
| | |
Kumiai Chemical Industry Co. Ltd.(a) | | | 31,200 | | | | 224,969 | |
| | |
Kuraray Co. Ltd. | | | 8,000 | | | | 90,858 | |
| | |
Kureha Corp. | | | 800 | | | | 47,067 | |
| | |
LANXESS AG | | | 2,156 | | | | 49,224 | |
| | |
Lenzing AG* (a) | | | 1,068 | | | | 41,486 | |
See Accompanying Notes to the Financial Statements.
| | | | |
184 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Lintec Corp. | | | 15,600 | | | $ | 255,665 | |
| | |
Methanex Corp. | | | 1,290 | | | | 53,208 | |
| | |
Mitsubishi Chemical Group Corp. | | | 31,200 | | | | 174,722 | |
| | |
Mitsubishi Gas Chemical Co., Inc. | | | 6,200 | | | | 83,004 | |
| | |
Mitsui Chemicals, Inc. | | | 5,300 | | | | 131,691 | |
| | |
Nihon Nohyaku Co. Ltd. | | | 16,400 | | | | 69,306 | |
| | |
Nihon Parkerizing Co. Ltd. | | | 4,100 | | | | 29,347 | |
| | |
Nippon Kayaku Co. Ltd. | | | 3,800 | | | | 32,343 | |
| | |
Nippon Paint Holdings Co. Ltd. | | | 15,600 | | | | 103,729 | |
| | |
Nippon Pillar Packing Co. Ltd. | | | 7,800 | | | | 191,594 | |
| | |
Nippon Sanso Holdings Corp.(a) | | | 2,800 | | | | 69,720 | |
| | |
Nippon Shokubai Co. Ltd. | | | 1,400 | | | | 51,629 | |
| | |
Nippon Soda Co. Ltd. | | | 9,539 | | | | 338,868 | |
| | |
Nissan Chemical Corp. | | | 2,900 | | | | 116,712 | |
| | |
Nitto Denko Corp.(a) | | | 1,800 | | | | 115,087 | |
| | |
NOF Corp. | | | 1,200 | | | | 47,011 | |
| | |
Novozymes A/S, Class B(a) | | | 3,393 | | | | 152,127 | |
| | |
Nufarm Ltd.(a) | | | 20,418 | | | | 55,977 | |
| | |
Nutrien Ltd. | | | 10,218 | | | | 548,198 | |
| | |
OCI NV(a) | | | 1,933 | | | | 44,970 | |
| | |
Okamoto Industries, Inc.(a) | | | 5,700 | | | | 195,715 | |
| | |
Orica Ltd.(a) | | | 6,731 | | | | 62,477 | |
| | |
Osaka Soda Co. Ltd.(a) | | | 8,400 | | | | 486,989 | |
| | |
Recticel SA(a) | | | 2,200 | | | | 19,743 | |
| | |
Resonac Holdings Corp. | | | 4,200 | | | | 67,183 | |
| | |
Sanyo Chemical Industries Ltd. | | | 3,900 | | | | 103,136 | |
| | |
Shikoku Kasei Holdings Corp. | | | 3,200 | | | | 35,836 | |
| | |
Shin-Etsu Chemical Co. Ltd. | | | 42,900 | | | | 1,265,655 | |
| | |
Shin-Etsu Polymer Co. Ltd. | | | 800 | | | | 7,163 | |
| | |
Sika AG (Registered) | | | 2,262 | | | | 539,122 | |
| | |
SOL SpA | | | 3,009 | | | | 86,510 | |
| | |
Solvay SA | | | 1,599 | | | | 168,575 | |
| | |
Sumitomo Chemical Co. Ltd.(a) | | | 46,800 | | | | 118,047 | |
| | |
Symrise AG, Class A | | | 2,067 | | | | 210,180 | |
| | |
T Hasegawa Co. Ltd. | | | 900 | | | | 18,541 | |
| | |
Taiyo Holdings Co. Ltd.(a) | | | 1,800 | | | | 29,001 | |
| | |
Teijin Ltd. | | | 4,100 | | | | 36,764 | |
| | |
Tessenderlo Group SA(a) | | | 8,931 | | | | 259,602 | |
| | |
Toagosei Co. Ltd. | | | 42,900 | | | | 389,639 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – (continued) | |
| | |
Tokai Carbon Co. Ltd. | | | 6,600 | | | $ | 49,986 | |
| | |
Tokuyama Corp. | | | 23,400 | | | | 350,896 | |
| | |
Tokyo Ohka Kogyo Co. Ltd. | | | 700 | | | | 39,838 | |
| | |
Toray Industries, Inc. | | | 19,500 | | | | 93,325 | |
| | |
Tosoh Corp. | | | 7,800 | | | | 94,638 | |
| | |
Toyo Gosei Co. Ltd.(a) | | | 300 | | | | 12,321 | |
| | |
Toyo Ink SC Holdings Co. Ltd.(a) | | | 13,300 | | | | 224,382 | |
| | |
Toyobo Co. Ltd. | | | 27,300 | | | | 181,886 | |
| | |
UBE Corp. | | | 4,100 | | | | 62,646 | |
| | |
Umicore SA | | | 3,034 | | | | 71,996 | |
| | |
Victrex plc | | | 5,289 | | | | 88,375 | |
| | |
Wacker Chemie AG | | | 256 | | | | 31,253 | |
| | |
W-Scope Corp.* | | | 4,100 | | | | 23,364 | |
| | |
Yara International ASA | | | 2,583 | | | | 84,391 | |
| | |
Zeon Corp. | | | 3,600 | | | | 29,417 | |
| | | | | | | 14,353,417 | |
|
Commercial Services & Supplies – 1.1% | |
| | |
Aker Carbon Capture ASA* | | | 23,288 | | | | 22,054 | |
| | |
Befesa SA(b) | | | 1,394 | | | | 40,579 | |
| | |
Big Technologies plc* | | | 11,924 | | | | 26,044 | |
| | |
Bilfinger SE | | | 9,360 | | | | 342,514 | |
| | |
Boyd Group Services, Inc. | | | 372 | | | | 63,354 | |
| | |
Brambles Ltd. | | | 22,737 | | | | 188,731 | |
| | |
Bravida Holding AB(b) | | | 984 | | | | 6,139 | |
| | |
Caverion OYJ | | | 8,888 | | | | 80,136 | |
| | |
Cleanaway Waste Management Ltd.(a) | | | 35,024 | | | | 49,673 | |
| | |
Coor Service Management Holding AB(b) | | | 6,692 | | | | 23,048 | |
| | |
Dai Nippon Printing Co. Ltd.(a) | | | 3,900 | | | | 100,664 | |
| | |
Daiseki Co. Ltd.(a) | | | 1,499 | | | | 40,928 | |
| | |
Derichebourg SA | | | 30,264 | | | | 130,579 | |
| | |
DO & CO AG | | | 369 | | | | 43,060 | |
| | |
Downer EDI Ltd.(a) | | | 229,515 | | | | 547,847 | |
| | |
Duskin Co. Ltd. | | | 4,100 | | | | 88,987 | |
| | |
Elis SA | | | 4,777 | | | | 77,785 | |
| | |
GFL Environmental, Inc. | | | 2,416 | | | | 69,526 | |
| | |
Intrum AB(a) | | | 26,715 | | | | 136,771 | |
| | |
ISS A/S | | | 2,508 | | | | 36,228 | |
| | |
Japan Elevator Service Holdings Co. Ltd. | | | 4,200 | | | | 55,050 | |
| | |
Kokuyo Co. Ltd. | | | 4,100 | | | | 63,025 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 185 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Commercial Services & Supplies – (continued) | |
| | |
Loomis AB, Class B | | | 984 | | | $ | 25,488 | |
| | |
Matsuda Sangyo Co. Ltd. | | | 4,100 | | | | 70,795 | |
| | |
Mitie Group plc | | | 481,455 | | | | 575,458 | |
| | |
Mitsubishi Pencil Co. Ltd. | | | 1,800 | | | | 22,036 | |
| | |
Nippon Kanzai Holdings Co. Ltd. | | | 1,300 | | | | 21,426 | |
| | |
Okamura Corp. | | | 29,100 | | | | 410,238 | |
| | |
Park24 Co. Ltd.* | | | 2,200 | | | | 24,565 | |
| | |
Prestige International, Inc. | | | 4,000 | | | | 16,085 | |
| | |
Prosegur Cash SA(b) | | | 90,528 | | | | 49,184 | |
| | |
Prosegur Cia de Seguridad SA | | | 57,195 | | | | 85,363 | |
| | |
RB Global, Inc. | | | 2,691 | | | | 175,911 | |
| | |
Rentokil Initial plc | | | 35,256 | | | | 178,313 | |
| | |
Sdiptech AB, Class B* | | | 1,958 | | | | 38,309 | |
| | |
Secom Co. Ltd. | | | 2,700 | | | | 186,305 | |
| | |
Securitas AB, Class B(a) | | | 11,275 | | | | 90,078 | |
| | |
Serco Group plc | | | 59,046 | | | | 102,459 | |
| | |
Smart Metering Systems plc | | | 7,215 | | | | 55,945 | |
| | |
Societe BIC SA | | | 328 | | | | 20,542 | |
| | |
Sohgo Security Services Co. Ltd. | | | 9,500 | | | | 55,302 | |
| | |
SPIE SA | | | 2,992 | | | | 78,557 | |
| | |
Takkt AG | | | 2,728 | | | | 34,890 | |
| | |
TOPPAN Holdings, Inc. | | | 4,100 | | | | 93,454 | |
| | |
Veridis Environment Ltd.* (a) | | | 2,870 | | | | 14,855 | |
| | |
Waste Connections, Inc. | | | 3,744 | | | | 484,259 | |
| | | | | | | 5,142,539 | |
|
Communications Equipment – 0.2% | |
| | |
Nokia OYJ | | | 79,911 | | | | 265,223 | |
| | |
Spirent Communications plc | | | 25,338 | | | | 29,901 | |
| | |
Telefonaktiebolaget LM Ericsson, Class A | | | 3,789 | | | | 17,703 | |
| | |
Telefonaktiebolaget LM Ericsson, Class B | | | 65,169 | | | | 291,703 | |
| | |
VTech Holdings Ltd. | | | 54,600 | | | | 317,848 | |
| | | | | | | 922,378 | |
|
Construction & Engineering – 2.0% | |
| | |
Ackermans & van Haaren NV | | | 454 | | | | 67,327 | |
| | |
ACS Actividades de Construccion y Servicios SA | | | 4,873 | | | | 176,002 | |
| | |
AF Gruppen ASA | | | 704 | | | | 7,335 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Construction & Engineering – (continued) | |
| | |
Ashtrom Group Ltd.(a) | | | 1,861 | | | $ | 20,019 | |
| | |
Balfour Beatty plc | | | 18,286 | | | | 68,609 | |
| | |
Bouygues SA | | | 2,760 | | | | 96,884 | |
| | |
Burkhalter Holding AG | | | 615 | | | | 57,307 | |
| | |
Chiyoda Corp.* (a) | | | 58,500 | | | | 136,356 | |
| | |
Chudenko Corp. | | | 4,100 | | | | 66,382 | |
| | |
Daiho Corp. | | | 3,900 | | | | 99,016 | |
| | |
Eiffage SA | | | 1,560 | | | | 141,313 | |
| | |
Elco Ltd. | | | 3,666 | | | | 87,428 | |
| | |
Elecnor SA | | | 14,781 | | | | 248,414 | |
| | |
Electra Ltd. | | | 15 | | | | 4,745 | |
| | |
EXEO Group, Inc. | | | 4,100 | | | | 84,629 | |
| | |
Ferrovial SE | | | 6,772 | | | | 203,574 | |
| | |
Fugro NV* | | | 6,864 | | | | 113,109 | |
| | |
Gold Finance Holdings Ltd.* ‡ | | | 89,827 | | | | — | |
| | |
Hazama Ando Corp. | | | 57,000 | | | | 437,723 | |
| | |
HOCHTIEF AG | | | 442 | | | | 45,598 | |
| | |
INFRONEER Holdings, Inc. | | | 4,100 | | | | 42,951 | |
| | |
Instalco AB(a) (b) | | | 11,606 | | | | 32,389 | |
| | |
JGC Holdings Corp. | | | 5,400 | | | | 65,679 | |
| | |
Johns Lyng Group Ltd.(a) | | | 4,879 | | | | 18,844 | |
| | |
Kajima Corp. | | | 11,800 | | | | 193,154 | |
| | |
Kinden Corp. | | | 2,300 | | | | 34,611 | |
| | |
Kumagai Gumi Co. Ltd. | | | 12,500 | | | | 311,169 | |
| | |
Kvutzat Acro Ltd.(a) | | | 4,223 | | | | 34,082 | |
| | |
Kyudenko Corp. | | | 2,100 | | | | 62,191 | |
| | |
Maire Tecnimont SpA | | | 53,820 | | | | 249,737 | |
| | |
MIRAIT ONE Corp. | | | 35,100 | | | | 462,144 | |
| | |
Monadelphous Group Ltd.(a) | | | 7,216 | | | | 64,192 | |
| | |
Morgan Sindall Group plc | | | 14,898 | | | | 339,866 | |
| | |
NCC AB, Class B | | | 25,467 | | | | 260,308 | |
| | |
Nippon Densetsu Kogyo Co. Ltd. | | | 1,700 | | | | 22,933 | |
| | |
Nippon Road Co. Ltd. (The) | | | 6,900 | | | | 90,029 | |
| | |
Nishimatsu Construction Co. Ltd. | | | 1,700 | | | | 40,781 | |
| | |
NRW Holdings Ltd.(a) | | | 161,694 | | | | 255,941 | |
| | |
NYAB OYJ(a) | | | 33,784 | | | | 16,926 | |
| | |
Obayashi Corp. | | | 12,000 | | | | 102,057 | |
| | |
Okumura Corp. | | | 11,700 | | | | 355,377 | |
| | |
Peab AB, Class B(a) | | | 63,102 | | | | 234,275 | |
| | |
Penta-Ocean Construction Co. Ltd. | | | 9,700 | | | | 56,588 | |
| | |
Raito Kogyo Co. Ltd. | | | 3,200 | | | | 41,203 | |
| | |
Raiznext Corp.(a) | | | 11,700 | | | | 108,776 | |
See Accompanying Notes to the Financial Statements.
| | | | |
186 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Construction & Engineering – (continued) | |
| | |
Sacyr SA(a) | | | 29,203 | | | $ | 84,145 | |
| | |
Sanki Engineering Co. Ltd.(a) | | | 17,200 | | | | 199,093 | |
| | |
Shapir Engineering and Industry Ltd.(a) | | | 2,525 | | | | 13,531 | |
| | |
Shikun & Binui Ltd.* (a) | | | 20,336 | | | | 45,945 | |
| | |
Shimizu Corp. | | | 12,000 | | | | 84,863 | |
| | |
Shinnihon Corp. | | | 12,300 | | | | 98,030 | |
| | |
SHO-BOND Holdings Co. Ltd. | | | 1,200 | | | | 46,908 | |
| | |
Skanska AB, Class B | | | 8,190 | | | | 122,674 | |
| | |
SNC-Lavalin Group, Inc. | | | 2,068 | | | | 57,381 | |
| | |
Stantec, Inc. | | | 1,758 | | | | 107,449 | |
| | |
Sumitomo Densetsu Co. Ltd.(a) | | | 6,400 | | | | 111,312 | |
| | |
Sumitomo Mitsui Construction Co. Ltd. | | | 62,400 | | | | 164,812 | |
| | |
Sweco AB, Class B | | | 4,708 | | | | 43,192 | |
| | |
Taihei Dengyo Kaisha Ltd. | | | 5,200 | | | | 134,940 | |
| | |
Taikisha Ltd. | | | 1,000 | | | | 28,855 | |
| | |
Taisei Corp. | | | 4,400 | | | | 148,144 | |
| | |
Takamatsu Construction Group Co. Ltd. | | | 7,800 | | | | 141,224 | |
| | |
Toa Corp. | | | 7,800 | | | | 193,139 | |
| | |
Toda Corp. | | | 5,200 | | | | 28,691 | |
| | |
Toenec Corp. | | | 4,000 | | | | 108,290 | |
| | |
Toyo Construction Co. Ltd. | | | 8,200 | | | | 66,544 | |
| | |
Veidekke ASA | | | 3,088 | | | | 26,646 | |
| | |
Ventia Services Group Pty. Ltd.(a) | | | 28,618 | | | | 49,829 | |
| | |
Vinci SA | | | 7,683 | | | | 848,475 | |
| | |
Webuild SpA(a) | | | 28,249 | | | | 50,820 | |
| | |
Worley Ltd. | | | 7,728 | | | | 80,196 | |
| | |
WSP Global, Inc. | | | 1,677 | | | | 219,239 | |
| | |
Yokogawa Bridge Holdings Corp. | | | 14,200 | | | | 232,815 | |
| | | | | | | 9,195,155 | |
|
Construction Materials – 0.7% | |
| | |
Adbri Ltd.* (a) | | | 123,864 | | | | 154,496 | |
| | |
Boral Ltd.* (a) | | | 3,476 | | | | 9,904 | |
| | |
Breedon Group plc | | | 97,165 | | | | 368,453 | |
| | |
Brickworks Ltd.(a) | | | 1,435 | | | | 22,269 | |
| | |
Buzzi SpA | | | 3,148 | | | | 83,186 | |
| | |
Cementir Holding NV | | | 17,199 | | | | 143,071 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Construction Materials – (continued) | |
| | |
CSR Ltd. | | | 24,887 | | | $ | 88,398 | |
| | |
Heidelberg Materials AG | | | 2,925 | | | | 211,721 | |
| | |
Holcim AG | | | 11,583 | | | | 713,779 | |
| | |
Ibstock plc(b) | | | 27,720 | | | | 41,205 | |
| | |
Imerys SA | | | 1,103 | | | | 29,170 | |
| | |
James Hardie Industries plc, CHDI* | | | 5,889 | | | | 145,752 | |
| | |
Marshalls plc | | | 88,491 | | | | 220,987 | |
| | |
Mitani Sekisan Co. Ltd.(a) | | | 1,200 | | | | 35,894 | |
| | |
RHI Magnesita NV(a) | | | 11,037 | | | | 343,660 | |
| | |
Sumitomo Osaka Cement Co. Ltd. | | | 1,700 | | | | 39,210 | |
| | |
Taiheiyo Cement Corp. | | | 2,200 | | | | 37,312 | |
| | |
Titan Cement International SA(a) | | | 12,324 | | | | 232,913 | |
| | |
Vicat SACA | | | 5,226 | | | | 160,193 | |
| | |
Wienerberger AG | | | 2,596 | | | | 62,947 | |
| | | | | | | 3,144,520 | |
|
Consumer Finance – 0.3% | |
| | |
Acom Co. Ltd. | | | 20,500 | | | | 47,770 | |
| | |
AEON Financial Service Co. Ltd. | | | 4,100 | | | | 33,516 | |
| | |
Cembra Money Bank AG | | | 1,638 | | | | 112,404 | |
| | |
Credit Corp. Group Ltd.(a) | | | 6,068 | | | | 46,372 | |
| | |
Credit Saison Co. Ltd. | | | 2,100 | | | | 31,137 | |
| | |
Direct Finance of Direct Group 2006 Ltd.(a) | | | 574 | | | | 43,558 | |
| | |
goeasy Ltd.(a) | | | 4,290 | | | | 339,924 | |
| | |
Gruppo MutuiOnline SpA | | | 1,056 | | | | 29,691 | |
| | |
Isracard Ltd. | | | 15,211 | | | | 47,375 | |
| | |
J Trust Co. Ltd.(a) | | | 32,800 | | | | 102,659 | |
| | |
Jaccs Co. Ltd. | | | 9,500 | | | | 323,055 | |
| | |
KRUK SA | | | 738 | | | | 81,506 | |
| | |
Latitude Group Holdings Ltd.(a) | | | 88,452 | | | | 66,084 | |
| | |
Marui Group Co. Ltd. | | | 3,200 | | | | 50,067 | |
| | |
Orient Corp. | | | 4,100 | | | | 30,402 | |
| | |
Sun Hung Kai & Co. Ltd. | | | 246,000 | | | | 82,057 | |
| | | | | | | 1,467,577 | |
|
Consumer Staples Distribution & Retail – 1.6% | |
| | |
Aeon Co. Ltd. | | | 13,213 | | | | 276,309 | |
| | |
Ain Holdings, Inc. | | | 800 | | | | 22,408 | |
| | |
Alimentation Couche-Tard, Inc. | | | 11,271 | | | | 612,892 | |
| | |
Arcs Co. Ltd. | | | 18,418 | | | | 349,887 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 187 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Axfood AB | | | 1,496 | | | $ | 33,019 | |
| | |
Axial Retailing, Inc. | | | 7,800 | | | | 198,032 | |
| | |
Belc Co. Ltd. | | | 800 | | | | 37,294 | |
| | |
Carrefour SA | | | 11,934 | | | | 209,144 | |
| | |
Casino Guichard Perrachon SA* (a) | | | 14,640 | | | | 13,927 | |
| | |
Coles Group Ltd. | | | 20,046 | | | | 193,809 | |
| | |
Cosmos Pharmaceutical Corp.(a) | | | 200 | | | | 20,727 | |
| | |
Create SD Holdings Co. Ltd. | | | 500 | | | | 10,647 | |
| | |
Dino Polska SA* (b) | | | 988 | | | | 93,431 | |
| | |
Distribuidora Internacional de Alimentacion SA* | | | 3,367,945 | | | | 43,431 | |
| | |
Empire Co. Ltd., Class A | | | 3,918 | | | | 107,246 | |
| | |
Endeavour Group Ltd. | | | 17,056 | | | | 53,347 | |
| | |
Etablissements Franz Colruyt NV | | | 1,044 | | | | 43,114 | |
| | |
Fuji Co. Ltd. | | | 4,200 | | | | 52,859 | |
| | |
George Weston Ltd. | | | 1,092 | | | | 118,321 | |
| | |
GrainCorp Ltd., Class A(a) | | | 74,841 | | | | 328,856 | |
| | |
HelloFresh SE* | | | 2,970 | | | | 64,544 | |
| | |
Inageya Co. Ltd.(a) | | | 2,998 | | | | 31,634 | |
| | |
J Sainsbury plc | | | 36,677 | | | | 114,513 | |
| | |
Jeronimo Martins SGPS SA | | | 4,905 | | | | 112,920 | |
| | |
Kansai Food Market Ltd.(a) | | | 8,200 | | | | 72,771 | |
| | |
Kato Sangyo Co. Ltd. | | | 700 | | | | 19,505 | |
| | |
Kesko OYJ, Class A | | | 2,248 | | | | 38,683 | |
| | |
Kesko OYJ, Class B | | | 4,715 | | | | 79,566 | |
| | |
Kobe Bussan Co. Ltd.(a) | | | 1,900 | | | | 46,959 | |
| | |
Koninklijke Ahold Delhaize NV | | | 20,865 | | | | 617,521 | |
| | |
Kusuri no Aoki Holdings Co. Ltd. | | | 600 | | | | 38,988 | |
| | |
Life Corp. | | | 7,800 | | | | 182,324 | |
| | |
Loblaw Cos. Ltd. | | | 2,340 | | | | 191,178 | |
| | |
Marks & Spencer Group plc* | | | 46,416 | | | | 122,109 | |
| | |
MARR SpA | | | 4,018 | | | | 47,567 | |
| | |
MatsukiyoCocokara & Co. | | | 7,100 | | | | 123,674 | |
| | |
Maxvalu Tokai Co. Ltd. | | | 500 | | | | 9,865 | |
| | |
Metcash Ltd. | | | 18,048 | | | | 42,052 | |
| | |
METRO AG* | | | 4,346 | | | | 27,562 | |
| | |
Metro, Inc., Class A | | | 3,432 | | | | 174,140 | |
| | |
Mitsubishi Shokuhin Co. Ltd. | | | 7,800 | | | | 203,698 | |
| | |
North West Co., Inc. (The) | | | 2,419 | | | | 61,614 | |
| | |
Ocado Group plc* | | | 13,301 | | | | 75,100 | |
| | |
Oisix ra daichi, Inc.* (a) | | | 2,000 | | | | 15,055 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Olam Group Ltd. | | | 28,700 | | | $ | 20,739 | |
| | |
Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. | | | 574 | | | | 30,931 | |
| | |
Redcare Pharmacy NV* (b) | | | 748 | | | | 83,214 | |
| | |
Seven & i Holdings Co. Ltd. | | | 12,000 | | | | 435,247 | |
| | |
Sheng Siong Group Ltd. | | | 17,900 | | | | 20,251 | |
| | |
Shufersal Ltd.* | | | 3,578 | | | | 15,062 | |
| | |
Sugi Holdings Co. Ltd. | | | 800 | | | | 32,165 | |
| | |
Sundrug Co. Ltd. | | | 1,600 | | | | 43,253 | |
| | |
Tesco plc | | | 143,715 | | | | 470,332 | |
| | |
Tsuruha Holdings, Inc. | | | 900 | | | | 65,667 | |
| | |
United Super Markets Holdings, Inc.(a) | | | 2,000 | | | | 14,144 | |
| | |
Valor Holdings Co. Ltd. | | | 15,600 | | | | 242,480 | |
| | |
Welcia Holdings Co. Ltd. | | | 2,300 | | | | 37,960 | |
| | |
Woolworths Group Ltd. | | | 19,383 | | | | 432,232 | |
| | | | | | | 7,275,919 | |
|
Containers & Packaging – 0.3% | |
| | |
Billerud Aktiebolag | | | 5,485 | | | | 50,811 | |
| | |
CCL Industries, Inc., Class B | | | 2,625 | | | | 102,523 | |
| | |
DS Smith plc | | | 26,376 | | | | 91,281 | |
| | |
FP Corp. | | | 1,200 | | | | 22,907 | |
| | |
Fuji Seal International, Inc. | | | 2,000 | | | | 22,094 | |
| | |
Huhtamaki OYJ | | | 2,051 | | | | 70,262 | |
| | |
Mayr Melnhof Karton AG(a) | | | 275 | | | | 32,265 | |
| | |
Metsa Board OYJ, Class B(a) | | | 3,813 | | | | 28,777 | |
| | |
Orora Ltd. | | | 26,585 | | | | 41,407 | |
| | |
Rengo Co. Ltd. | | | 5,200 | | | | 34,240 | |
| | |
SIG Group AG | | | 5,850 | | | | 128,500 | |
| | |
Smurfit Kappa Group plc(a) | | | 5,499 | | | | 178,675 | |
| | |
Toyo Seikan Group Holdings Ltd. | | | 5,600 | | | | 93,367 | |
| | |
Transcontinental, Inc., Class A | | | 24,141 | | | | 177,547 | |
| | |
Verallia SA(b) | | | 1,364 | | | | 44,319 | |
| | |
Vidrala SA | | | 560 | | | | 41,494 | |
| | |
Winpak Ltd. | | | 1,716 | | | | 46,675 | |
| | | | | | | 1,207,144 | |
|
Distributors – 0.1% | |
| | |
Arata Corp. | | | 5,700 | | | | 210,017 | |
| | |
Bapcor Ltd.(a) | | | 17,917 | | | | 60,578 | |
| | |
D’ieteren Group | | | 343 | | | | 50,793 | |
See Accompanying Notes to the Financial Statements.
| | | | |
188 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Distributors – (continued) | |
| | |
Inchcape plc | | | 6,396 | | | $ | 51,690 | |
| | |
Inter Cars SA | | | 205 | | | | 27,729 | |
| | |
PALTAC Corp. | | | 800 | | | | 25,672 | |
| | | | | | | 426,479 | |
|
Diversified Consumer Services – 0.1% | |
| | |
AcadeMedia AB(b) | | | 29,406 | | | | 121,702 | |
| | |
Auction Technology Group plc* | | | 2,583 | | | | 17,584 | |
| | |
G8 Education Ltd.(a) | | | 51,492 | | | | 30,972 | |
| | |
IDP Education Ltd.(a) | | | 2,501 | | | | 34,283 | |
| | |
InvoCare Ltd. | | | 6,933 | | | | 55,573 | |
| | |
Pearson plc | | | 12,792 | | | | 147,711 | |
| | | | | | | 407,825 | |
|
Diversified REITs – 0.5% | |
| | |
Argosy Property Ltd., REIT | | | 68,432 | | | | 42,192 | |
| | |
British Land Co. plc (The), REIT | | | 12,400 | | | | 44,764 | |
| | |
Centuria Capital Group, REIT(a) | | | 55,661 | | | | 40,352 | |
| | |
Charter Hall Group, REIT(a) | | | 8,140 | | | | 44,684 | |
| | |
Charter Hall Long Wale REIT, REIT(a) | | | 20,910 | | | | 39,982 | |
| | |
Cromwell European REIT, REIT(b) | | | 93,674 | | | | 113,865 | |
| | |
Daiwa House REIT Investment Corp., REIT | | | 42 | | | | 74,213 | |
| | |
GPT Group (The), REIT | | | 14,186 | | | | 32,514 | |
| | |
Growthpoint Properties Australia Ltd., REIT(a) | | | 27,019 | | | | 33,701 | |
| | |
H&R REIT, REIT | | | 45,942 | | | | 282,287 | |
| | |
Hankyu Hanshin REIT, Inc., REIT(a) | | | 82 | | | | 76,886 | |
| | |
Heiwa Real Estate REIT, Inc., REIT(a) | | | 43 | | | | 40,119 | |
| | |
Hulic Reit, Inc., REIT | | | 24 | | | | 24,437 | |
| | |
ICADE, REIT | | | 836 | | | | 27,216 | |
| | |
Land Securities Group plc, REIT | | | 6,027 | | | | 41,614 | |
| | |
LXI REIT plc, REIT(b) | | | 107,679 | | | | 112,044 | |
| | |
Merlin Properties Socimi SA, REIT | | | 7,011 | | | | 58,248 | |
| | |
Mirvac Group, REIT | | | 36,859 | | | | 42,474 | |
| | |
Mori Trust Reit, Inc., REIT | | | 82 | | | | 39,905 | |
| | |
NIPPON REIT Investment Corp., REIT | | | 18 | | | | 41,480 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Diversified REITs – (continued) | |
| | |
Nomura Real Estate Master Fund, Inc., REIT | | | 82 | | | $ | 90,368 | |
| | |
NTT UD REIT Investment Corp., REIT(a) | | | 24 | | | | 19,762 | |
| | |
OUE Commercial REIT, REIT | | | 175,177 | | | | 30,048 | |
| | |
Reit 1 Ltd., REIT | | | 65,325 | | | | 235,913 | |
| | |
Sekisui House Reit, Inc., REIT(a) | | | 55 | | | | 28,908 | |
| | |
Sella Capital Real Estate Ltd., REIT | | | 81,042 | | | | 143,832 | |
| | |
Star Asia Investment Corp., REIT | | | 240 | | | | 90,330 | |
| | |
Stockland, REIT | | | 23,534 | | | | 52,748 | |
| | |
Stride Property Group, REIT(a) | | | 33,231 | | | | 26,287 | |
| | |
Suntec REIT, REIT | | | 43,500 | | | | 34,926 | |
| | |
Takara Leben Real Estate Investment Corp., REIT(a) | | | 312 | | | | 203,955 | |
| | |
Tokyu REIT, Inc., REIT | | | 22 | | | | 26,206 | |
| | |
United Urban Investment Corp., REIT | | | 40 | | | | 40,252 | |
| | | | | | | 2,276,512 | |
|
Diversified Telecommunication Services – 1.2% | |
| | |
BCE, Inc.(a) | | | 3,549 | | | | 131,606 | |
| | |
Bezeq The Israeli Telecommunication Corp. Ltd. | | | 38,130 | | | | 46,881 | |
| | |
BT Group plc(a) | | | 121,173 | | | | 165,785 | |
| | |
Cellnex Telecom SA(b) | | | 8,502 | | | | 249,109 | |
| | |
Chorus Ltd.(a) | | | 8,733 | | | | 36,446 | |
| | |
Deutsche Telekom AG (Registered) | | | 72,540 | | | | 1,569,916 | |
| | |
Elisa OYJ | | | 2,262 | | | | 95,829 | |
| | |
Gamma Communications plc | | | 4,867 | | | | 61,775 | |
| | |
Helios Towers plc* | | | 26,527 | | | | 19,491 | |
| | |
HKBN Ltd. | | | 51,500 | | | | 17,837 | |
| | |
HKT Trust & HKT Ltd. | | | 53,400 | | | | 55,280 | |
| | |
Infrastrutture Wireless Italiane SpA(b) | | | 5,179 | | | | 56,494 | |
| | |
Internet Initiative Japan, Inc. | | | 2,000 | | | | 32,018 | |
| | |
Koninklijke KPN NV | | | 50,934 | | | | 170,933 | |
| | |
Nippon Telegraph & Telephone Corp. | | | 460,200 | | | | 537,247 | |
| | |
NOS SGPS SA | | | 9,348 | | | | 34,128 | |
| | |
Orange Polska SA | | | 38,417 | | | | 71,145 | |
| | |
Orange SA | | | 35,568 | | | | 417,685 | |
| | |
PCCW Ltd. | | | 77,035 | | | | 37,707 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 189 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Diversified Telecommunication Services – (continued) | |
| | |
Proximus SADP | | | 3,640 | | | $ | 30,095 | |
| | |
Quebecor, Inc., Class B(a) | | | 2,728 | | | | 56,220 | |
| | |
RAI Way SpA(b) | | | 8,120 | | | | 40,339 | |
| | |
Singapore Telecommunications Ltd. | | | 101,400 | | | | 176,148 | |
| | |
Spark New Zealand Ltd. | | | 29,930 | | | | 86,522 | |
| | |
Swisscom AG (Registered) | | | 429 | | | | 256,443 | |
| | |
Telecom Italia SpA* | | | 69,160 | | | | 17,969 | |
| | |
Telecom Italia SpA* (a) | | | 169,960 | | | | 43,852 | |
| | |
Telefonica Deutschland Holding AG | | | 10,209 | | | | 17,303 | |
| | |
Telefonica SA(a) | | | 115,869 | | | | 446,538 | |
| | |
Telekom Austria AG, Class A | | | 4,091 | | | | 28,540 | |
| | |
Telenor ASA | | | 7,093 | | | | 72,475 | |
| | |
Telia Co. AB | | | 35,720 | | | | 75,483 | |
| | |
Telstra Group Ltd. | | | 60,801 | | | | 146,670 | |
| | |
TELUS Corp. | | | 8,385 | | | | 135,054 | |
| | |
TPG Telecom Ltd. | | | 11,890 | | | | 38,996 | |
| | |
United Internet AG (Registered) | | | 1,720 | | | | 35,724 | |
| | | | | | | 5,511,683 | |
|
Electric Utilities – 1.5% | |
| | |
Acciona SA | | | 369 | | | | 46,414 | |
| | |
BKW AG | | | 440 | | | | 73,781 | |
| | |
Chubu Electric Power Co., Inc. | | | 15,600 | | | | 187,732 | |
| | |
Chugoku Electric Power Co., Inc. (The) | | | 4,206 | | | | 26,142 | |
| | |
CK Infrastructure Holdings Ltd. | | | 11,000 | | | | 50,961 | |
| | |
CLP Holdings Ltd. | | | 24,500 | | | | 179,258 | |
| | |
Contact Energy Ltd. | | | 11,528 | | | | 52,234 | |
| | |
EDP – Energias de Portugal SA | | | 44,655 | | | | 187,385 | |
| | |
Elia Group SA/NV | | | 640 | | | | 60,646 | |
| | |
Emera, Inc.(a) | | | 3,978 | | | | 130,150 | |
| | |
Endesa SA(a) | | | 4,510 | | | | 84,687 | |
| | |
Enea SA* | | | 80,808 | | | | 139,889 | |
| | |
Enel SpA | | | 160,875 | | | | 1,018,229 | |
| | |
EVN AG | | | 748 | | | | 20,280 | |
| | |
Fortis, Inc.(a) | | | 7,017 | | | | 278,304 | |
| | |
Fortum OYJ | | | 10,023 | | | | 118,656 | |
| | |
Genesis Energy Ltd. | | | 16,699 | | | | 22,437 | |
| | |
HK Electric Investments & HK Electric Investments Ltd.(b) | | | 44,500 | | | | 24,682 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electric Utilities – (continued) | |
| | |
Hokkaido Electric Power Co., Inc. | | | 74,100 | | | $ | 309,523 | |
| | |
Hokuriku Electric Power Co.* | | | 70,200 | | | | 346,121 | |
| | |
Hydro One Ltd.(a) (b) | | | 4,407 | | | | 114,155 | |
| | |
Iberdrola SA | | | 82,797 | | | | 918,922 | |
| | |
Kansai Electric Power Co., Inc. (The) | | | 15,600 | | | | 198,444 | |
| | |
Kyushu Electric Power Co., Inc.* | | | 9,100 | | | | 57,913 | |
| | |
Manawa Energy Ltd.(a) | | | 5,123 | | | | 12,724 | |
| | |
Mercury NZ Ltd. | | | 11,013 | | | | 37,794 | |
| | |
Origin Energy Ltd. | | | 25,077 | | | | 144,962 | |
| | |
Orsted A/S | | | 2,730 | | | | 131,371 | |
| | |
PGE Polska Grupa Energetyczna SA* | | | 25,070 | | | | 43,417 | |
| | |
Power Assets Holdings Ltd. | | | 22,500 | | | | 107,545 | |
| | |
Redeia Corp. SA | | | 6,474 | | | | 100,627 | |
| | |
Romande Energie Holding SA (Registered) | | | 525 | | | | 32,652 | |
| | |
Shikoku Electric Power Co., Inc. | | | 70,200 | | | | 476,745 | |
| | |
SSE plc | | | 15,591 | | | | 308,946 | |
| | |
Tauron Polska Energia SA* | | | 377,520 | | | | 331,383 | |
| | |
Terna—Rete Elettrica Nazionale | | | 20,372 | | | | 155,599 | |
| | |
Tohoku Electric Power Co., Inc. | | | 10,900 | | | | 67,662 | |
| | |
Tokyo Electric Power Co. Holdings, Inc.* | | | 22,400 | | | | 94,218 | |
| | |
Verbund AG | | | 1,326 | | | | 114,930 | |
| | | | | | | 6,807,520 | |
|
Electrical Equipment – 1.2% | |
| | |
ABB Ltd. (Registered) | | | 24,687 | | | | 825,748 | |
| | |
Accelleron Industries AG | | | 4,290 | | | | 105,311 | |
| | |
Alfen N.V.* (a) (b) | | | 1,230 | | | | 38,574 | |
| | |
Ballard Power Systems, Inc.* (a) | | | 13,202 | | | | 44,031 | |
| | |
Ceres Power Holdings plc* (a) | | | 5,412 | | | | 13,003 | |
| | |
Daihen Corp.(a) | | | 7,800 | | | | 243,098 | |
| | |
DiscoverIE Group plc | | | 4,796 | | | | 35,908 | |
| | |
Energiekontor AG | | | 410 | | | | 30,206 | |
| | |
Fagerhult Group AB | | | 6,336 | | | | 31,984 | |
| | |
Fuji Electric Co. Ltd. | | | 1,500 | | | | 56,238 | |
| | |
Fujikura Ltd. | | | 8,200 | | | | 57,989 | |
| | |
Furukawa Electric Co. Ltd. | | | 23,400 | | | | 346,569 | |
| | |
GS Yuasa Corp. | | | 4,100 | | | | 65,150 | |
| | |
Hexatronic Group AB | | | 2,337 | | | | 5,432 | |
See Accompanying Notes to the Financial Statements.
| | | | |
190 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electrical Equipment – (continued) | |
| | |
Huber + Suhner AG (Registered) | | | 867 | | | $ | 59,162 | |
| | |
Idec Corp. | | | 2,200 | | | | 38,961 | |
| | |
Legrand SA | | | 4,056 | | | | 349,320 | |
| | |
Mabuchi Motor Co. Ltd. | | | 1,600 | | | | 45,366 | |
| | |
Mersen SA | | | 8,580 | | | | 283,862 | |
| | |
Mitsubishi Electric Corp. | | | 31,200 | | | | 345,591 | |
| | |
NEL ASA* | | | 12,688 | | | | 8,314 | |
| | |
Nexans SA | | | 451 | | | | 31,796 | |
| | |
Nidec Corp.(a) | | | 7,910 | | | | 283,140 | |
| | |
NKT A/S* | | | 3,217 | | | | 161,275 | |
| | |
Nordex SE* | | | 7,130 | | | | 74,806 | |
| | |
PNE AG | | | 2,173 | | | | 27,516 | |
| | |
Prysmian SpA | | | 3,744 | | | | 139,657 | |
| | |
Sanyo Denki Co. Ltd.(a) | | | 3,900 | | | | 142,666 | |
| | |
Schneider Electric SE | | | 8,073 | | | | 1,237,138 | |
| | |
Siemens Energy AG* | | | 6,229 | | | | 55,109 | |
| | |
Signify NV(b) | | | 2,730 | | | | 70,582 | |
| | |
TKH Group NV, CVA | | | 2,141 | | | | 78,030 | |
| | |
Varta AG* | | | 1,008 | | | | 20,340 | |
| | |
Vestas Wind Systems A/S* | | | 14,859 | | | | 320,396 | |
| | | | | | | 5,672,268 | |
|
Electronic Equipment, Instruments & Components – 1.9% | |
| | |
Ai Holdings Corp. | | | 4,100 | | | | 62,808 | |
| | |
Alps Alpine Co. Ltd. | | | 5,348 | | | | 43,400 | |
| | |
ALSO Holding AG (Registered) | | | 369 | | | | 93,664 | |
| | |
Amano Corp. | | | 800 | | | | 16,222 | |
| | |
Anritsu Corp. | | | 8,200 | | | | 60,751 | |
| | |
AT&S Austria Technologie & Systemtechnik AG(a) | | | 8,307 | | | | 207,922 | |
| | |
Azbil Corp. | | | 2,100 | | | | 61,206 | |
| | |
Barco NV | | | 3,731 | | | | 57,144 | |
| | |
Canon Electronics, Inc. | | | 8,000 | | | | 101,317 | |
| | |
Canon Marketing Japan, Inc. | | | 1,500 | | | | 35,647 | |
| | |
Celestica, Inc.* (a) | | | 38,727 | | | | 903,002 | |
| | |
Citizen Watch Co. Ltd. | | | 8,200 | | | | 47,269 | |
| | |
Codan Ltd.(a) | | | 7,304 | | | | 35,979 | |
| | |
Comet Holding AG (Registered) | | | 440 | | | | 86,110 | |
| | |
Daiwabo Holdings Co. Ltd. | | | 4,100 | | | | 76,981 | |
| | |
Dexerials Corp.(a) | | | 19,500 | | | | 436,624 | |
| | |
Elematec Corp. | | | 8,000 | | | | 90,066 | |
| | |
FIH Mobile Ltd.* | | | 328,000 | | | | 24,313 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
FIT Hon Teng Ltd.* (a) (b) | | | 600,000 | | | $ | 80,515 | |
| | |
Halma plc | | | 6,201 | | | | 138,829 | |
| | |
Hamamatsu Photonics KK | | | 2,700 | | | | 99,072 | |
| | |
Hexagon AB, Class B | | | 29,289 | | | | 237,769 | |
| | |
Hioki EE Corp. | | | 700 | | | | 30,136 | |
| | |
Hirose Electric Co. Ltd.(a) | | | 582 | | | | 65,139 | |
| | |
Horiba Ltd. | | | 800 | | | | 39,919 | |
| | |
Hosiden Corp. | | | 19,500 | | | | 226,746 | |
| | |
Ibiden Co. Ltd. | | | 2,800 | | | | 117,236 | |
| | |
Inficon Holding AG (Registered) | | | 82 | | | | 88,753 | |
| | |
Iriso Electronics Co. Ltd. | | | 1,200 | | | | 28,010 | |
| | |
Japan Display, Inc.* (a) | | | 80,000 | | | | 19,545 | |
| | |
Jenoptik AG | | | 2,585 | | | | 61,095 | |
| | |
Kaga Electronics Co. Ltd.(a) | | | 7,900 | | | | 311,420 | |
| | |
Keyence Corp. | | | 3,000 | | | | 1,151,903 | |
| | |
Kitron ASA | | | 9,471 | | | | 24,924 | |
| | |
Koa Corp.(a) | | | 4,100 | | | | 38,984 | |
| | |
Kyocera Corp. | | | 5,500 | | | | 267,800 | |
| | |
Lagercrantz Group AB, Class B | | | 2,640 | | | | 24,031 | |
| | |
Landis+Gyr Group AG | | | 1,102 | | | | 81,374 | |
| | |
LEM Holding SA (Registered) | | | 27 | | | | 54,590 | |
| | |
Macnica Holdings, Inc. | | | 1,600 | | | | 63,653 | |
| | |
Maxell Ltd.(a) | | | 15,600 | | | | 165,636 | |
| | |
Meiko Electronics Co. Ltd. | | | 7,800 | | | | 158,632 | |
| | |
MOG Digitech Holdings Ltd.* | | | 30,000 | | | | 8,435 | |
| | |
Murata Manufacturing Co. Ltd. | | | 27,000 | | | | 441,695 | |
| | |
Mycronic AB | | | 924 | | | | 20,179 | |
| | |
NCAB Group AB | | | 9,298 | | | | 44,357 | |
| | |
Nichicon Corp. | | | 3,200 | | | | 26,370 | |
| | |
Nissha Co. Ltd.(a) | | | 15,600 | | | | 160,074 | |
| | |
Nohmi Bosai Ltd. | | | 2,500 | | | | 29,813 | |
| | |
Omron Corp. | | | 2,800 | | | | 98,858 | |
| | |
Optex Group Co. Ltd. | | | 4,100 | | | | 45,536 | |
| | |
Oxford Instruments plc | | | 3,036 | | | | 66,386 | |
| | |
PAX Global Technology Ltd. | | | 234,000 | | | | 161,491 | |
| | |
Renishaw plc | | | 880 | | | | 32,932 | |
| | |
Restar Holdings Corp. | | | 7,800 | | | | 126,751 | |
| | |
Riken Keiki Co. Ltd. | | | 1,200 | | | | 48,414 | |
| | |
Ryosan Co. Ltd.(a) | | | 7,800 | | | | 243,098 | |
| | |
Sensirion Holding AG* (a) (b) | | | 733 | | | | 54,771 | |
| | |
Sesa SpA | | | 294 | | | | 29,600 | |
| | |
SES-imagotag SA* (a) | | | 246 | | | | 24,546 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 191 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Shimadzu Corp. | | | 4,700 | | | $ | 110,017 | |
| | |
Siix Corp. | | | 11,700 | | | | 107,772 | |
| | |
Softwareone Holding AG | | | 5,917 | | | | 115,863 | |
| | |
Spectris plc | | | 2,112 | | | | 79,447 | |
| | |
Taiyo Yuden Co. Ltd.(a) | | | 2,500 | | | | 55,070 | |
| | |
TDK Corp. | | | 6,500 | | | | 238,549 | |
| | |
Tokyo Electron Device Ltd. | | | 5,600 | | | | 141,437 | |
| | |
Topcon Corp. | | | 4,100 | | | | 36,859 | |
| | |
Vaisala OYJ, Class A | | | 836 | | | | 28,454 | |
| | |
Venture Corp. Ltd. | | | 4,500 | | | | 38,429 | |
| | |
VSTECS Holdings Ltd. | | | 238,000 | | | | 120,147 | |
| | |
Yokogawa Electric Corp. | | | 4,900 | | | | 87,763 | |
| | | | | | | 8,839,249 | |
|
Energy Equipment & Services – 0.5% | |
| | |
Aker Solutions ASA(b) | | | 7,560 | | | | 30,127 | |
| | |
Borr Drilling Ltd.* (a) | | | 4,018 | | | | 24,960 | |
| | |
BW Offshore Ltd. | | | 23,042 | | | | 48,098 | |
| | |
John Wood Group plc* | | | 33,661 | | | | 57,961 | |
| | |
Lapidoth Capital Ltd.(a) | | | 7,527 | | | | 101,698 | |
| | |
Modec, Inc.* | | | 8,000 | | | | 86,949 | |
| | |
Odfjell Drilling Ltd. | | | 33,899 | | | | 118,340 | |
| | |
PGS ASA* | | | 303,108 | | | | 273,760 | |
| | |
Saipem SpA* | | | 24,641 | | | | 37,415 | |
| | |
SBM Offshore NV(a) | | | 60,996 | | | | 757,555 | |
| | |
Schoeller-Bleckmann Oilfield Equipment AG | | | 615 | | | | 31,008 | |
| | |
Secure Energy Services, Inc. | | | 82,290 | | | | 456,426 | |
| | |
Subsea 7 SA | | | 3,608 | | | | 47,281 | |
| | |
Technip Energies NV | | | 3,977 | | | | 86,806 | |
| | |
Tenaris SA | | | 9,321 | | | | 146,208 | |
| | |
TGS ASA | | | 1,927 | | | | 26,253 | |
| | |
Vallourec SACA* | | | 5,740 | | | | 68,712 | |
| | | | | | | 2,399,557 | |
|
Entertainment – 0.5% | |
| | |
Bollore SE | | | 12,858 | | | | 69,993 | |
| | |
Capcom Co. Ltd. | | | 3,400 | | | | 108,638 | |
| | |
CD Projekt SA | | | 1,193 | | | | 29,726 | |
| | |
COLOPL, Inc.* (a) | | | 8,200 | | | | 31,296 | |
| | |
CTS Eventim AG & Co. KGaA | | | 704 | | | | 42,453 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Entertainment – (continued) | |
| | |
Daiichikosho Co. Ltd. | | | 2,200 | | | $ | 32,220 | |
| | |
DeNA Co. Ltd. | | | 1,100 | | | | 10,659 | |
| | |
Embracer Group AB, Class B* (a) | | | 13,161 | | | | 21,328 | |
| | |
EVT Ltd.(a) | | | 6,232 | | | | 40,997 | |
| | |
Kahoot! ASA* | | | 22,755 | | | | 71,086 | |
| | |
Kinepolis Group NV(a) | | | 1,030 | | | | 50,625 | |
| | |
Koei Tecmo Holdings Co. Ltd. | | | 2,492 | | | | 32,317 | |
| | |
Konami Group Corp. | | | 1,000 | | | | 51,200 | |
| | |
Modern Times Group MTG AB, Class B* | | | 7,040 | | | | 56,300 | |
| | |
Nexon Co. Ltd. | | | 7,800 | | | | 141,404 | |
| | |
Nintendo Co. Ltd. | | | 17,200 | | | | 706,535 | |
| | |
Paradox Interactive AB | | | 952 | | | | 18,064 | |
| | |
Shochiku Co. Ltd.(a) | | | 800 | | | | 50,521 | |
| | |
Square Enix Holdings Co. Ltd. | | | 1,800 | | | | 59,428 | |
| | |
Stillfront Group AB* | | | 152,529 | | | | 157,476 | |
| | |
Toei Animation Co. Ltd.(a) | | | 200 | | | | 17,842 | |
| | |
Toho Co. Ltd. | | | 1,200 | | | | 40,656 | |
| | |
Ubisoft Entertainment SA* | | | 1,425 | | | | 40,487 | |
| | |
Universal Music Group NV | | | 10,920 | | | | 266,630 | |
| | | | | | | 2,147,881 | |
|
Financial Services – 1.5% | |
| | |
Adyen NV* (b) | | | 468 | | | | 313,575 | |
| | |
AMP Ltd.(a) | | | 65,142 | | | | 43,101 | |
| | |
Banca Mediolanum SpA | | | 4,444 | | | | 36,197 | |
| | |
BFF Bank SpA(b) | | | 58,110 | | | | 557,407 | |
| | |
Burford Capital Ltd. | | | 3,280 | | | | 40,478 | |
| | |
Challenger Ltd. | | | 9,812 | | | | 36,343 | |
| | |
Creades AB, Class A | | | 22,464 | | | | 119,632 | |
| | |
Deutsche Pfandbriefbank AG(b) | | | 45,903 | | | | 305,673 | |
| | |
Edenred SE | | | 3,861 | | | | 205,033 | |
| | |
Element Fleet Management Corp. | | | 7,332 | | | | 99,080 | |
| | |
Eurazeo SE | | | 1,144 | | | | 64,269 | |
| | |
EXOR NV(a) | | | 2,496 | | | | 213,542 | |
| | |
Financial Partners Group Co. Ltd.(a) | | | 19,500 | | | | 182,710 | |
| | |
First National Financial Corp. | | | 123 | | | | 3,066 | |
| | |
Fuyo General Lease Co. Ltd. | | | 1,000 | | | | 80,425 | |
| | |
GMO Payment Gateway, Inc. | | | 1,000 | | | | 39,526 | |
| | |
GRENKE AG | | | 1,804 | | | | 38,518 | |
See Accompanying Notes to the Financial Statements.
| | | | |
192 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Financial Services – (continued) | |
| | |
Groupe Bruxelles Lambert NV | | | 1,326 | | | $ | 96,709 | |
| | |
HAL Trust | | | 1,131 | | | | 127,198 | |
| | |
Helia Group Ltd. | | | 104,013 | | | | 238,398 | |
| | |
Hypoport SE* | | | 252 | | | | 30,659 | |
| | |
Industrivarden AB, Class A | | | 5,109 | | | | 131,787 | |
| | |
Industrivarden AB, Class C(a) | | | 2,173 | | | | 55,858 | |
| | |
Investment AB Oresund | | | 9,198 | | | | 81,914 | |
| | |
Investor AB, Class A(a) | | | 9,789 | | | | 177,597 | |
| | |
Investor AB, Class B(a) | | | 25,311 | | | | 463,057 | |
| | |
Japan Securities Finance Co. Ltd. | | | 4,700 | | | | 46,272 | |
| | |
Kinnevik AB, Class A* | | | 2,665 | | | | 23,042 | |
| | |
Kinnevik AB, Class B* | | | 902 | | | | 7,668 | |
| | |
L E Lundbergforetagen AB, Class B | | | 1,348 | | | | 54,860 | |
| | |
Liberty Financial Group Ltd.(a) (b) | | | 14,555 | | | | 35,940 | |
| | |
M&G plc | | | 46,020 | | | | 110,681 | |
| | |
Mitsubishi HC Capital, Inc. | | | 19,529 | | | | 127,520 | |
| | |
Mizuho Leasing Co. Ltd. | | | 11,838 | | | | 372,857 | |
| | |
Network International Holdings plc* (b) | | | 14,574 | | | | 68,582 | |
| | |
Nexi SpA* (b) | | | 14,840 | | | | 85,896 | |
| | |
Nuvei Corp.(a) (b) | | | 1,328 | | | | 18,472 | |
| | |
ORIX Corp. | | | 24,900 | | | | 446,390 | |
| | |
OSB Group plc | | | 147,381 | | | | 536,161 | |
| | |
Paragon Banking Group plc | | | 81,159 | | | | 436,868 | |
| | |
PEUGEOT INVEST | | | 308 | | | | 29,853 | |
| | |
Plus500 Ltd. | | | 22,659 | | | | 387,962 | |
| | |
Ricoh Leasing Co. Ltd.(a) | | | 5,200 | | | | 154,340 | |
| | |
Sofina SA | | | 316 | | | | 59,788 | |
| | |
Tokyo Century Corp. | | | 600 | | | | 22,796 | |
| | |
Tyro Payments Ltd.* (a) | | | 8,888 | | | | 4,840 | |
| | |
Washington H Soul Pattinson & Co. Ltd.(a) | | | 2,856 | | | | 60,433 | |
| | |
Wendel SE | | | 497 | | | | 37,088 | |
| | |
Wise plc, Class A* | | | 9,328 | | | | 75,340 | |
| | |
Worldline SA* (b) | | | 3,978 | | | | 50,373 | |
| | |
Zenkoku Hosho Co. Ltd. | | | 600 | | | | 19,076 | |
| | | | | | | 7,054,850 | |
|
Food Products – 2.6% | |
| | |
a2 Milk Co. Ltd. (The)* (a) | | | 12,579 | | | | 30,583 | |
| | |
AAK AB | | | 2,860 | | | | 54,268 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Food Products – (continued) | |
| | |
Agrana Beteiligungs AG(a) | | | 5,742 | | | $ | 91,343 | |
| | |
Ajinomoto Co., Inc. | | | 7,800 | | | | 282,241 | |
| | |
Ariake Japan Co. Ltd. | | | 800 | | | | 25,144 | |
| | |
Aryzta AG* | | | 62,524 | | | | 114,255 | |
| | |
Associated British Foods plc | | | 4,797 | | | | 117,932 | |
| | |
Ausnutria Dairy Corp. Ltd. | | | 98,000 | | | | 34,443 | |
| | |
Austevoll Seafood ASA | | | 3,432 | | | | 23,440 | |
| | |
Bakkafrost P/F | | | 820 | | | | 36,957 | |
| | |
Barry Callebaut AG (Registered) | | | 78 | | | | 117,851 | |
| | |
Bega Cheese Ltd.(a) | | | 2,583 | | | | 4,546 | |
| | |
Bell Food Group AG (Registered) | | | 123 | | | | 36,492 | |
| | |
Bumitama Agri Ltd. | | | 269,100 | | | | 111,957 | |
| | |
Calbee, Inc. | | | 600 | | | | 11,509 | |
| | |
Chocoladefabriken Lindt & Spruengli AG | | | 24 | | | | 265,040 | |
| | |
Chocoladefabriken Lindt & Spruengli AG (Registered) | | | 2 | | | | 217,570 | |
| | |
Costa Group Holdings Ltd.(a) | | | 28,801 | | | | 56,530 | |
| | |
Cranswick plc | | | 2,860 | | | | 121,258 | |
| | |
Danone SA | | | 9,165 | | | | 543,948 | |
| | |
DyDo Group Holdings, Inc. | | | 500 | | | | 19,281 | |
| | |
Ebro Foods SA | | | 1,618 | | | | 27,500 | |
| | |
Elders Ltd.(a) | | | 56,199 | | | | 211,004 | |
| | |
Emmi AG (Registered) | | | 41 | | | | 38,655 | |
| | |
First Pacific Co. Ltd. | | | 780,000 | | | | 295,069 | |
| | |
First Resources Ltd. | | | 5,100 | | | | 5,621 | |
| | |
Fuji Oil Holdings, Inc. | | | 1,200 | | | | 18,941 | |
| | |
Glanbia plc(a) | | | 3,500 | | | | 55,049 | |
| | |
Golden Agri-Resources Ltd. | | | 213,400 | | | | 42,055 | |
| | |
Grieg Seafood ASA | | | 3,299 | | | | 21,896 | |
| | |
Hilton Food Group plc | | | 25,779 | | | | 204,268 | |
| | |
Hokuto Corp. | | | 4,100 | | | | 49,137 | |
| | |
House Foods Group, Inc. | | | 2,400 | | | | 50,442 | |
| | |
Inghams Group Ltd.(a) | | | 17,712 | | | | 41,269 | |
| | |
Itoham Yonekyu Holdings, Inc. | | | 1,240 | | | | 34,102 | |
| | |
JDE Peet’s NV(a) | | | 1,804 | | | | 50,035 | |
| | |
Kagome Co. Ltd.(a) | | | 900 | | | | 18,631 | |
| | |
Kameda Seika Co. Ltd. | | | 900 | | | | 24,246 | |
| | |
Kerry Group plc, Class A | | | 2,457 | | | | 189,273 | |
| | |
Kikkoman Corp. | | | 3,400 | | | | 191,300 | |
| | |
Kotobuki Spirits Co. Ltd. | | | 2,500 | | | | 32,900 | |
| | |
Leroy Seafood Group ASA | | | 5,456 | | | | 21,586 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 193 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Food Products – (continued) | |
| | |
Lotus Bakeries NV | | | 6 | | | $ | 44,394 | |
| | |
Maple Leaf Foods, Inc.(a) | | | 3,772 | | | | 75,019 | |
| | |
Maruha Nichiro Corp.(a) | | | 15,600 | | | | 265,863 | |
| | |
Megmilk Snow Brand Co. Ltd. | | | 17,600 | | | | 282,516 | |
| | |
MEIJI Holdings Co. Ltd. | | | 3,400 | | | | 83,471 | |
| | |
Morinaga & Co. Ltd. | | | 1,100 | | | | 39,571 | |
| | |
Morinaga Milk Industry Co. Ltd. | | | 1,200 | | | | 46,742 | |
| | |
Mowi ASA | | | 5,412 | | | | 87,829 | |
| | |
Nestle SA (Registered) | | | 39,507 | | | | 4,256,971 | |
| | |
Neto Malinda Trading Ltd.* (a) | | | 615 | | | | 5,585 | |
| | |
NH Foods Ltd. | | | 3,200 | | | | 95,718 | |
| | |
Nichirei Corp. | | | 1,600 | | | | 34,526 | |
| | |
Nippn Corp. | | | 4,000 | | | | 60,722 | |
| | |
Nisshin Oillio Group Ltd. (The)(a) | | | 8,900 | | | | 247,410 | |
| | |
Nisshin Seifun Group, Inc. | | | 2,690 | | | | 40,445 | |
| | |
Nissin Foods Holdings Co. Ltd. | | | 1,500 | | | | 130,245 | |
| | |
Nissui Corp. | | | 109,200 | | | | 527,235 | |
| | |
Orkla ASA | | | 8,856 | | | | 60,992 | |
| | |
Premier Foods plc | | | 46,494 | | | | 66,122 | |
| | |
Premium Brands Holdings Corp., Class A | | | 660 | | | | 42,445 | |
| | |
Prima Meat Packers Ltd. | | | 11,700 | | | | 177,147 | |
| | |
Riken Vitamin Co. Ltd. | | | 1,800 | | | | 26,742 | |
| | |
S Foods, Inc. | | | 7,200 | | | | 150,946 | |
| | |
Sakata Seed Corp. | | | 1,400 | | | | 37,393 | |
| | |
Salmar ASA | | | 788 | | | | 37,299 | |
| | |
Saputo, Inc. | | | 4,403 | | | | 88,805 | |
| | |
Savencia SA | | | 1,676 | | | | 98,143 | |
| | |
Schouw & Co. A/S | | | 656 | | | | 40,412 | |
| | |
Societe LDC SADIR | | | 1,326 | | | | 173,796 | |
| | |
Strauss Group Ltd.* | | | 952 | | | | 17,616 | |
| | |
Suedzucker AG | | | 1,979 | | | | 29,913 | |
| | |
SunOpta, Inc.* (a) | | | 4,428 | | | | 16,905 | |
| | |
Tate & Lyle plc | | | 5,494 | | | | 42,033 | |
| | |
Toyo Suisan Kaisha Ltd. | | | 1,800 | | | | 82,723 | |
| | |
United Malt Grp Ltd.* | | | 15,129 | | | | 47,895 | |
| | |
Viscofan SA | | | 943 | | | | 54,423 | |
| | |
Vitasoy International Holdings Ltd.(a) | | | 60,000 | | | | 73,921 | |
| | |
WH Group Ltd.(b) | | | 214,500 | | | | 128,021 | |
| | |
Wilmar International Ltd. | | | 66,300 | | | | 172,277 | |
| | |
Yakult Honsha Co. Ltd. | | | 4,900 | | | | 115,087 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Food Products – (continued) | |
| | |
Yamazaki Baking Co. Ltd. | | | 2,900 | | | $ | 61,372 | |
| | | | | | | 12,106,257 | |
|
Gas Utilities – 0.3% | |
| | |
AltaGas Ltd.(a) | | | 5,772 | | | | 107,104 | |
| | |
APA Group | | | 15,548 | | | | 81,116 | |
| | |
Brookfield Infrastructure Corp., Class A(a) | | | 1,506 | | | | 38,739 | |
| | |
Enagas SA(a) | | | 4,223 | | | | 70,504 | |
| | |
Hong Kong & China Gas Co. Ltd. | | | 156,000 | | | | 108,657 | |
| | |
Italgas SpA | | | 6,908 | | | | 35,034 | |
| | |
K&O Energy Group, Inc. | | | 4,100 | | | | 63,837 | |
| | |
Keppel Infrastructure Trust | | | 114,394 | | | | 36,738 | |
| | |
Naturgy Energy Group SA(a) | | | 3,034 | | | | 85,625 | |
| | |
Nippon Gas Co. Ltd. | | | 1,900 | | | | 28,360 | |
| | |
Osaka Gas Co. Ltd. | | | 9,100 | | | | 170,770 | |
| | |
Rubis SCA | | | 3,034 | | | | 65,871 | |
| | |
Saibu Gas Holdings Co. Ltd. | | | 1,400 | | | | 17,647 | |
| | |
Shizuoka Gas Co. Ltd.(a) | | | 15,600 | | | | 105,068 | |
| | |
Snam SpA | | | 28,002 | | | | 128,160 | |
| | |
Superior Plus Corp. | | | 10,208 | | | | 68,531 | |
| | |
Toho Gas Co. Ltd. | | | 2,000 | | | | 34,243 | |
| | |
Tokyo Gas Co. Ltd. | | | 7,800 | | | | 174,032 | |
| | | | | | | 1,420,036 | |
|
Ground Transportation – 1.2% | |
| | |
ALD SA(b) | | | 2,214 | | | | 14,825 | |
| | |
Aurizon Holdings Ltd.(a) | | | 15,826 | | | | 34,269 | |
| | |
Canadian National Railway Co.(a) | | | 8,814 | | | | 931,589 | |
| | |
Canadian Pacific Kansas City Ltd. | | | 13,533 | | | | 959,812 | |
| | |
Central Japan Railway Co. | | | 14,200 | | | | 318,421 | |
| | |
ComfortDelGro Corp. Ltd. | | | 73,800 | | | | 71,104 | |
| | |
East Japan Railway Co. | | | 5,300 | | | | 275,490 | |
| | |
Firstgroup plc | | | 31,646 | | | | 60,635 | |
| | |
Hankyu Hanshin Holdings, Inc. | | | 4,100 | | | | 127,972 | |
| | |
Jungfraubahn Holding AG (Registered) | | | 287 | | | | 48,630 | |
| | |
Keikyu Corp. | | | 5,700 | | | | 48,101 | |
| | |
Keio Corp.(a) | | | 1,800 | | | | 53,128 | |
| | |
Keisei Electric Railway Co. Ltd. | | | 2,900 | | | | 108,325 | |
See Accompanying Notes to the Financial Statements.
| | | | |
194 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Ground Transportation – (continued) | |
| | |
Kelsian Group Ltd.(a) | | | 14,850 | | | $ | 56,602 | |
| | |
Kintetsu Group Holdings Co. Ltd. | | | 2,200 | | | | 61,579 | |
| | |
Kyushu Railway Co. | | | 2,100 | | | | 42,722 | |
| | |
Maruzen Showa Unyu Co. Ltd. | | | 7,800 | | | | 195,200 | |
| | |
Mobico Group plc | | | 193,128 | | | | 146,469 | |
| | |
MTR Corp. Ltd. | | | 25,264 | | | | 94,442 | |
| | |
Mullen Group Ltd.(a) | | | 29,211 | | | | 276,907 | |
| | |
Nagoya Railroad Co. Ltd. | | | 4,400 | | | | 61,230 | |
| | |
Nankai Electric Railway Co. Ltd. | | | 3,000 | | | | 57,149 | |
| | |
Nikkon Holdings Co. Ltd.(a) | | | 22,100 | | | | 465,217 | |
| | |
Nishi-Nippon Railroad Co. Ltd. | | | 1,100 | | | | 17,643 | |
| | |
NTG Nordic Transport Group A/S* (a) | | | 792 | | | | 31,349 | |
| | |
Odakyu Electric Railway Co. Ltd.(a) | | | 4,600 | | | | 65,031 | |
| | |
Redde Northgate plc | | | 81,471 | | | | 332,173 | |
| | |
Seibu Holdings, Inc. | | | 6,700 | | | | 65,011 | |
| | |
Seino Holdings Co. Ltd. | | | 3,100 | | | | 44,818 | |
| | |
Sixt SE | | | 308 | | | | 26,468 | |
| | |
Sixt SE (Preference) | | | 298 | | | | 17,104 | |
| | |
Stef SA | | | 1,326 | | | | 142,401 | |
| | |
TFI International, Inc. | | | 1,209 | | | | 133,602 | |
| | |
Tobu Railway Co. Ltd.(a) | | | 3,900 | | | | 93,325 | |
| | |
Tokyu Corp. | | | 8,300 | | | | 93,169 | |
| | |
West Japan Railway Co. | | | 3,900 | | | | 147,970 | |
| | | | | | | 5,719,882 | |
|
Health Care Equipment & Supplies – 1.1% | |
| | |
Alcon, Inc. | | | 7,410 | | | | 527,791 | |
| | |
Ambu A/S, Class B* (a) | | | 3,172 | | | | 31,211 | |
| | |
Ansell Ltd. | | | 2,200 | | | | 29,558 | |
| | |
Arjo AB, Class B | | | 11,562 | | | | 38,558 | |
| | |
Asahi Intecc Co. Ltd. | | | 3,200 | | | | 53,067 | |
| | |
BioMerieux | | | 825 | | | | 78,918 | |
| | |
Carl Zeiss Meditec AG | | | 715 | | | | 61,775 | |
| | |
Cochlear Ltd. | | | 942 | | | | 143,644 | |
| | |
Coloplast A/S, Class B | | | 1,443 | | | | 150,199 | |
| | |
ConvaTec Group plc(b) | | | 26,387 | | | | 65,383 | |
| | |
Demant A/S* | | | 1,980 | | | | 75,343 | |
| | |
DiaSorin SpA | | | 293 | | | | 26,170 | |
| | |
Eckert & Ziegler Strahlen- und Medizintechnik AG | | | 820 | | | | 32,191 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Eiken Chemical Co. Ltd. | | | 1,600 | | | $ | 15,689 | |
| | |
El.En. SpA | | | 2,684 | | | | 24,994 | |
| | |
Elekta AB, Class B | | | 6,069 | | | | 41,229 | |
| | |
EssilorLuxottica SA | | | 1,622 | | | | 292,554 | |
| | |
EssilorLuxottica SA | | | 2,629 | | | | 473,016 | |
| | |
Fisher & Paykel Healthcare Corp. Ltd. | | | 9,617 | | | | 116,405 | |
| | |
Fukuda Denshi Co. Ltd. | | | 7,800 | | | | 277,091 | |
| | |
Getinge AB, Class B | | | 2,980 | | | | 53,451 | |
| | |
Hogy Medical Co. Ltd. | | | 1,200 | | | | 25,871 | |
| | |
Hoya Corp. | | | 5,600 | | | | 530,067 | |
| | |
Japan Lifeline Co. Ltd. | | | 3,000 | | | | 22,642 | |
| | |
Koninklijke Philips NV* (a) | | | 14,001 | | | | 264,874 | |
| | |
Medacta Group SA(b) | | | 336 | | | | 38,472 | |
| | |
Medistim ASA | | | 1,188 | | | | 20,577 | |
| | |
Medmix AG(b) | | | 1,517 | | | | 31,439 | |
| | |
Menicon Co. Ltd. | | | 1,900 | | | | 21,773 | |
| | |
Nagaileben Co. Ltd. | | | 1,500 | | | | 20,522 | |
| | |
Nanosonics Ltd.* (a) | | | 16,777 | | | | 39,621 | |
| | |
Nihon Kohden Corp. | | | 2,300 | | | | 54,035 | |
| | |
Nipro Corp. | | | 4,100 | | | | 31,039 | |
| | |
Olympus Corp. | | | 19,500 | | | | 257,390 | |
| | |
Paramount Bed Holdings Co. Ltd. | | | 1,600 | | | | 26,983 | |
| | |
PolyNovo Ltd.* (a) | | | 32,604 | | | | 23,843 | |
| | |
Revenio Group OYJ | | | 574 | | | | 13,324 | |
| | |
Siemens Healthineers AG(b) | | | 4,485 | | | | 219,587 | |
| | |
Smith & Nephew plc | | | 10,881 | | | | 121,578 | |
| | |
Sonova Holding AG (Registered) | | | 747 | | | | 176,069 | |
| | |
STRATEC SE | | | 308 | | | | 14,194 | |
| | |
Straumann Holding AG (Registered) | | | 1,738 | | | | 204,252 | |
| | |
Surgical Science Sweden AB* | | | 1,584 | | | | 17,935 | |
| | |
Sysmex Corp. | | | 2,700 | | | | 127,526 | |
| | |
Terumo Corp. | | | 11,700 | | | | 316,131 | |
| | |
Xvivo Perfusion AB* | | | 1,892 | | | | 39,287 | |
| | |
Ypsomed Holding AG (Registered) | | | 123 | | | | 33,789 | |
| | | | | | | 5,301,057 | |
|
Health Care Providers & Services – 0.4% | |
| | |
Alfresa Holdings Corp. | | | 1,500 | | | | 23,652 | |
| | |
Amplifon SpA | | | 2,112 | | | | 59,471 | |
| | |
Arvida Group Ltd. | | | 256,833 | | | | 168,807 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 195 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Providers & Services – (continued) | |
| | |
As One Corp. | | | 800 | | | $ | 25,245 | |
| | |
BML, Inc.(a) | | | 7,800 | | | | 146,528 | |
| | |
Chartwell Retirement Residences(a) | | | 5,472 | | | | 40,047 | |
| | |
Clariane SE(a) | | | 24,180 | | | | 91,039 | |
| | |
CVS Group plc | | | 4,250 | | | | 75,552 | |
| | |
dentalcorp Holdings Ltd.* (a) | | | 6,768 | | | | 26,814 | |
| | |
EBOS Group Ltd.(a) | | | 2,066 | | | | 42,047 | |
| | |
Fagron | | | 3,775 | | | | 66,157 | |
| | |
Fresenius Medical Care AG & Co. KGaA | | | 2,574 | | | | 85,213 | |
| | |
Fresenius SE & Co. KGaA | | | 8,346 | | | | 213,839 | |
| | |
Galenica AG(b) | | | 792 | | | | 59,658 | |
| | |
H.U. Group Holdings, Inc. | | | 4,100 | | | | 68,561 | |
| | |
Healius Ltd.* | | | 27,347 | | | | 31,340 | |
| | |
Medicover AB, Class B | | | 3,403 | | | | 38,317 | |
| | |
Medipal Holdings Corp. | | | 5,100 | | | | 85,199 | |
| | |
NMC Health plc* ‡ | | | 2,074 | | | | — | |
| | |
Raffles Medical Group Ltd. | | | 4,124 | | | | 3,582 | |
| | |
Ramsay Health Care Ltd.(a) | | | 2,894 | | | | 89,198 | |
| | |
Ryman Healthcare Ltd.(a) | | | 11,375 | | | | 37,580 | |
| | |
Ship Healthcare Holdings, Inc. | | | 1,900 | | | | 29,169 | |
| | |
Sonic Healthcare Ltd. | | | 7,098 | | | | 129,205 | |
| | |
Spire Healthcare Group plc(b) | | | 14,036 | | | | 36,363 | |
| | |
Summerset Group Holdings Ltd.(a) | | | 13,895 | | | | 78,719 | |
| | |
Suzuken Co. Ltd. | | | 1,880 | | | | 57,277 | |
| | |
Terveystalo OYJ(b) | | | 4,480 | | | | 30,922 | |
| | |
Tokai Corp. | | | 4,100 | | | | 51,384 | |
| | |
Uniphar plc(a) | | | 15,050 | | | | 33,327 | |
| | |
Well Health Technologies Corp.* (a) | | | 10,947 | | | | 29,176 | |
| | | | | | | 1,953,388 | |
|
Health Care REITs – 0.1% | |
| | |
Aedifica SA, REIT | | | 832 | | | | 45,246 | |
| | |
Assura plc, REIT | | | 174,391 | | | | 86,635 | |
| | |
Cofinimmo SA, REIT | | | 41 | | | | 2,544 | |
| | |
NorthWest Healthcare Properties REIT, REIT(a) | | | 46,683 | | | | 134,845 | |
| | |
Parkway Life REIT, REIT | | | 12,500 | | | | 30,656 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care REITs – (continued) | |
| | |
Primary Health Properties plc, REIT | | | 79,089 | | | $ | 86,134 | |
| | |
Vital Healthcare Property Trust, REIT(a) | | | 30,155 | | | | 35,079 | |
| | | | | | | 421,139 | |
|
Health Care Technology – 0.1% | |
| | |
CompuGroup Medical SE & Co. KGaA | | | 1,599 | | | | 58,378 | |
| | |
M3, Inc. | | | 6,500 | | | | 99,317 | |
| | |
Medley, Inc.* | | | 1,000 | | | | 28,558 | |
| | |
Nexus AG | | | 984 | | | | 47,896 | |
| | |
Pro Medicus Ltd.(a) | | | 1,100 | | | | 51,914 | |
| | |
Sectra AB, Class B* | | | 2,948 | | | | 31,821 | |
| | | | | | | 317,884 | |
|
Hotel & Resort REITs – 0.0%(d) | |
| | |
CapitaLand Ascott Trust, REIT | | | 32,566 | | | | 21,393 | |
| | |
CDL Hospitality Trusts, REIT | | | 38,294 | | | | 27,112 | |
| | |
Far East Hospitality Trust, REIT | | | 53,976 | | | | 23,244 | |
| | |
Frasers Hospitality Trust, REIT | | | 39,200 | | | | 14,592 | |
| | |
Hoshino Resorts REIT, Inc., REIT(a) | | | 12 | | | | 47,067 | |
| | |
Invincible Investment Corp., REIT | | | 121 | | | | 46,420 | |
| | |
Japan Hotel REIT Investment Corp., REIT | | | 77 | | | | 34,930 | |
| | | | | | | 214,758 | |
|
Hotels, Restaurants & Leisure – 1.7% | |
| | |
Accor SA | | | 2,133 | | | | 67,795 | |
| | |
Amadeus IT Group SA | | | 6,435 | | | | 366,073 | |
| | |
AmRest Holdings SE* | | | 6,191 | | | | 39,226 | |
| | |
Aristocrat Leisure Ltd. | | | 8,619 | | | | 210,263 | |
| | |
Atom Corp.* | | | 5,800 | | | | 34,736 | |
| | |
Basic-Fit NV* (a) (b) | | | 2,632 | | | | 67,102 | |
| | |
Betsson AB, Class B* | | | 7,708 | | | | 77,407 | |
| | |
Cafe de Coral Holdings Ltd. | | | 4,000 | | | | 5,035 | |
| | |
Carnival plc* | | | 8,307 | | | | 84,411 | |
| | |
Colowide Co. Ltd.(a) | | | 3,500 | | | | 54,148 | |
| | |
Compass Group plc | | | 25,818 | | | | 649,447 | |
| | |
Corporate Travel Management Ltd.(a) | | | 3,366 | | | | 35,250 | |
| | |
Create Restaurants Holdings, Inc. | | | 4,400 | | | | 30,332 | |
| | |
Dalata Hotel Group plc | | | 8,159 | | | | 34,582 | |
See Accompanying Notes to the Financial Statements.
| | | | |
196 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
Deliveroo plc, Class A* (a) (b) | | | 60,106 | | | $ | 94,816 | |
| | |
Delivery Hero SE* (b) | | | 3,315 | | | | 83,990 | |
| | |
Domino’s Pizza Enterprises Ltd.(a) | | | 1,408 | | | | 45,287 | |
| | |
Domino’s Pizza Group plc | | | 22,191 | | | | 92,362 | |
| | |
Entain plc | | | 9,087 | | | | 102,592 | |
| | |
Evolution AB(b) | | | 2,886 | | | | 256,217 | |
| | |
Flight Centre Travel Group Ltd.(a) | | | 4,576 | | | | 53,977 | |
| | |
Flutter Entertainment plc* | | | 2,691 | | | | 421,144 | |
| | |
Food & Life Cos. Ltd. | | | 2,000 | | | | 33,411 | |
| | |
Fuji Kyuko Co. Ltd. | | | 1,000 | | | | 27,964 | |
| | |
Galaxy Entertainment Group Ltd. | | | 36,000 | | | | 201,748 | |
| | |
Genting Singapore Ltd. | | | 104,400 | | | | 65,533 | |
| | |
Greggs plc | | | 1,558 | | | | 44,806 | |
| | |
Heiwa Corp.(a) | | | 2,450 | | | | 34,490 | |
| | |
Hongkong & Shanghai Hotels Ltd. (The)* | | | 61,500 | | | | 47,395 | |
| | |
Ichibanya Co. Ltd. | | | 1,000 | | | | 35,128 | |
| | |
InterContinental Hotels Group plc | | | 2,769 | | | | 195,219 | |
| | |
J D Wetherspoon plc* | | | 6,583 | | | | 50,485 | |
| | |
Jumbo Interactive Ltd. | | | 3,476 | | | | 30,504 | |
| | |
Just Eat Takeaway.com NV* (a) (b) | | | 3,403 | | | | 41,170 | |
| | |
Kappa Create Co. Ltd.* (a) | | | 4,100 | | | | 42,910 | |
| | |
Kindred Group plc, SDR | | | 5,043 | | | | 41,192 | |
| | |
KOMEDA Holdings Co. Ltd. | | | 1,200 | | | | 21,790 | |
| | |
Kyoritsu Maintenance Co. Ltd.(a) | | | 1,100 | | | | 41,793 | |
| | |
La Francaise des Jeux SAEM(b) | | | 1,897 | | | | 60,996 | |
| | |
Lottery Corp. Ltd. (The) | | | 31,280 | | | | 89,716 | |
| | |
Mandarin Oriental International Ltd. | | | 8,000 | | | | 12,000 | |
| | |
McDonald’s Holdings Co. Japan Ltd.(a) | | | 1,100 | | | | 42,781 | |
| | |
Melco International Development Ltd.* | | | 41,000 | | | | 28,557 | |
| | |
Melia Hotels International SA* | | | 9,988 | | | | 55,373 | |
| | |
Mitchells & Butlers plc* | | | 22,924 | | | | 57,693 | |
| | |
Monogatari Corp. (The) | | | 1,500 | | | | 40,312 | |
| | |
MOS Food Services, Inc.(a) | | | 2,100 | | | | 45,690 | |
| | |
MTY Food Group, Inc. | | | 1,452 | | | | 54,576 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
NagaCorp Ltd.* | | | 40,372 | | | $ | 17,336 | |
| | |
Ohsho Food Service Corp. | | | 704 | | | | 32,447 | |
| | |
Oriental Land Co. Ltd. | | | 17,200 | | | | 551,622 | |
| | |
Playtech plc* | | | 16,197 | | | | 77,163 | |
| | |
Resorttrust, Inc. | | | 4,100 | | | | 58,585 | |
| | |
Restaurant Brands International, Inc.(a) | | | 4,251 | | | | 285,237 | |
| | |
Restaurant Brands New Zealand Ltd. | | | 1,154 | | | | 2,524 | |
| | |
Round One Corp.(a) | | | 78,000 | | | | 279,666 | |
| | |
Royal Holdings Co. Ltd. | | | 1,600 | | | | 27,120 | |
| | |
Saizeriya Co. Ltd. | | | 1,800 | | | | 72,739 | |
| | |
Sands China Ltd.* | | | 38,800 | | | | 104,133 | |
| | |
Scandic Hotels Group AB* (a) (b) | | | 9,870 | | | | 33,172 | |
| | |
SkiStar AB | | | 2,828 | | | | 26,831 | |
| | |
SKYCITY Entertainment Group Ltd.(a) | | | 56,129 | | | | 61,051 | |
| | |
Skylark Holdings Co. Ltd.* (a) | | | 3,700 | | | | 54,372 | |
| | |
Societe des Bains de Mer et du Cercle des Etrangers a Monaco | | | 451 | | | | 49,578 | |
| | |
Sodexo SA | | | 1,326 | | | | 139,990 | |
| | |
SSP Group plc* | | | 41,223 | | | | 90,040 | |
| | |
Star Entertainment Grp Ltd. (The)* | | | 146,381 | | | | 49,121 | |
| | |
Tabcorp Holdings Ltd. | | | 125,870 | | | | 61,763 | |
| | |
Tokyotokeiba Co. Ltd. | | | 1,200 | | | | 30,823 | |
| | |
Toridoll Holdings Corp. | | | 1,100 | | | | 26,468 | |
| | |
Trainline plc* (b) | | | 31,585 | | | | 99,803 | |
| | |
TUI AG* | | | 153,660 | | | | 771,164 | |
| | |
Webjet Ltd.* | | | 20,377 | | | | 78,571 | |
| | |
Whitbread plc | | | 2,446 | | | | 98,778 | |
| | |
Wynn Macau Ltd.* | | | 12,800 | | | | 11,304 | |
| | |
Yoshinoya Holdings Co. Ltd. | | | 4,900 | | | | 114,278 | |
| | |
Zensho Holdings Co. Ltd.(a) | | | 1,800 | | | | 94,193 | |
| | | | | | | 7,749,296 | |
|
Household Durables – 1.2% | |
| | |
Ariston Holding NV | | | 5,411 | | | | 30,256 | |
| | |
Azorim-Investment Development & Construction Co. Ltd.* (a) | | | 5,535 | | | | 17,307 | |
| | |
Barratt Developments plc | | | 21,567 | | | | 108,320 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 197 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Household Durables – (continued) | |
| | |
Bellway plc | | | 2,640 | | | $ | 66,889 | |
| | |
Berkeley Group Holdings plc | | | 1,312 | | | | 64,255 | |
| | |
Breville Group Ltd.(a) | | | 2,420 | | | | 32,483 | |
| | |
Cairn Homes plc(a) | | | 198,042 | | | | 231,903 | |
| | |
Casio Computer Co. Ltd. | | | 3,600 | | | | 28,573 | |
| | |
Danya Cebus Ltd. | | | 2,870 | | | | 71,510 | |
| | |
De’ Longhi SpA | | | 1,012 | | | | 22,592 | |
| | |
Dom Development SA | | | 2,244 | | | | 83,391 | |
| | |
Duniec Brothers Ltd.* (a) | | | 451 | | | | 16,722 | |
| | |
Electra Consumer Products 1970 Ltd.(a) | | | 656 | | | | 9,499 | |
| | |
Electrolux AB, Class B* | | | 3,198 | | | | 26,792 | |
| | |
Fiskars OYJ Abp | | | 574 | | | | 8,773 | |
| | |
Fujitsu General Ltd. | | | 2,100 | | | | 37,162 | |
| | |
GN Store Nord A/S* | | | 2,064 | | | | 34,286 | |
| | |
Haseko Corp. | | | 3,500 | | | | 42,766 | |
| | |
Iida Group Holdings Co. Ltd. | | | 5,400 | | | | 83,044 | |
| | |
JM AB(a) | | | 22,815 | | | | 242,594 | |
| | |
JS Global Lifestyle Co. Ltd.(a) (b) | | | 22,000 | | | | 3,458 | |
| | |
JVCKenwood Corp. | | | 8,200 | | | | 34,870 | |
| | |
Ki-Star Real Estate Co. Ltd.(a) | | | 3,300 | | | | 91,954 | |
| | |
Man Wah Holdings Ltd. | | | 52,000 | | | | 32,298 | |
| | |
Maytronics Ltd.(a) | | | 2,870 | | | | 26,674 | |
| | |
Nagawa Co. Ltd. | | | 500 | | | | 20,205 | |
| | |
Nikon Corp. | | | 5,800 | | | | 54,230 | |
| | |
Open House Group Co. Ltd.(a) | | | 1,800 | | | | 58,572 | |
| | |
Panasonic Holdings Corp. | | | 50,700 | | | | 438,221 | |
| | |
Persimmon plc | | | 2,091 | | | | 25,779 | |
| | |
Pressance Corp. | | | 8,000 | | | | 85,364 | |
| | |
Redrow plc | | | 100,269 | | | | 592,053 | |
| | |
Rinnai Corp. | | | 1,800 | | | | 32,846 | |
| | |
Sangetsu Corp. | | | 2,256 | | | | 42,053 | |
| | |
SEB SA | | | 616 | | | | 60,651 | |
| | |
Sekisui Chemical Co. Ltd. | | | 10,100 | | | | 136,983 | |
| | |
Sekisui House Ltd. | | | 15,600 | | | | 302,740 | |
| | |
Sony Group Corp. | | | 18,400 | | | | 1,509,591 | |
| | |
Sumitomo Forestry Co. Ltd. | | | 3,300 | | | | 77,006 | |
| | |
Tama Home Co. Ltd.(a) | | | 4,400 | | | | 98,782 | |
| | |
Tamron Co. Ltd. | | | 7,800 | | | | 209,878 | |
| | |
Taylor Wimpey plc | | | 49,487 | | | | 66,535 | |
| | |
Token Corp.(a) | | | 2,600 | | | | 135,627 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Household Durables – (continued) | |
| | |
Victoria plc* (a) | | | 5,192 | | | $ | 20,287 | |
| | |
Vistry Group plc | | | 7,920 | | | | 67,946 | |
| | |
YIT OYJ(a) | | | 56,628 | | | | 100,678 | |
| | |
Zojirushi Corp. | | | 5,400 | | | | 54,982 | |
| | | | | | | 5,639,380 | |
|
Household Products – 0.3% | |
| | |
Earth Corp. | | | 600 | | | | 19,651 | |
| | |
Essity AB, Class A | | | 2,009 | | | | 45,942 | |
| | |
Essity AB, Class B | | | 7,332 | | | | 166,883 | |
| | |
Henkel AG & Co. KGaA | | | 1,148 | | | | 72,394 | |
| | |
Henkel AG & Co. KGaA (Preference) | | | 2,613 | | | | 188,033 | |
| | |
Lion Corp. | | | 8,200 | | | | 78,592 | |
| | |
Pigeon Corp.(a) | | | 2,400 | | | | 25,364 | |
| | |
Reckitt Benckiser Group plc | | | 10,686 | | | | 713,440 | |
| | |
Sano-Brunos Enterprises Ltd.(a) | | | 308 | | | | 18,637 | |
| | |
Unicharm Corp. | | | 7,800 | | | | 263,751 | |
| | | | | | | 1,592,687 | |
|
Independent Power and Renewable Electricity Producers – 0.3% | |
| | |
Boralex, Inc., Class A | | | 2,081 | | | | 38,689 | |
| | |
Brookfield Renewable Corp., Class A | | | 2,068 | | | | 46,998 | |
| | |
Capital Power Corp. | | | 1,845 | | | | 47,167 | |
| | |
Corp. ACCIONA Energias Renovables SA | | | 1,276 | | | | 34,501 | |
| | |
Doral Group Renewable Energy Resources Ltd.* (a) | | | 34,563 | | | | 46,271 | |
| | |
Drax Group plc | | | 9,389 | | | | 48,147 | |
| | |
EDP Renovaveis SA | | | 3,946 | | | | 63,356 | |
| | |
Electric Power Development Co. Ltd.(a) | | | 3,100 | | | | 47,274 | |
| | |
Encavis AG* | | | 2,296 | | | | 29,863 | |
| | |
Enlight Renewable Energy Ltd.* | | | 1,428 | | | | 19,206 | |
| | |
ERG SpA | | | 704 | | | | 17,264 | |
| | |
Greenvolt-Energias Renovaveis SA* (a) | | | 6,900 | | | | 46,021 | |
| | |
Grenergy Renovables SA* (a) | | | 861 | | | | 20,422 | |
| | |
Innergex Renewable Energy, Inc. | | | 9,635 | | | | 59,271 | |
| | |
Meridian Energy Ltd. | | | 20,828 | | | | 58,514 | |
| | |
Neoen SA(b) | | | 1,514 | | | | 39,815 | |
| | |
Northland Power, Inc.(a) | | | 3,566 | | | | 50,064 | |
See Accompanying Notes to the Financial Statements.
| | | | |
198 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Independent Power and Renewable Electricity Producers – (continued) | |
| | |
RENOVA, Inc.* | | | 1,000 | | | $ | 7,125 | |
| | |
RWE AG | | | 10,062 | | | | 384,262 | |
| | |
Scatec ASA(b) | | | 8,405 | | | | 42,357 | |
| | |
Solaria Energia y Medio Ambiente SA* (a) | | | 4,811 | | | | 71,956 | |
| | |
TransAlta Corp. | | | 11,271 | | | | 82,406 | |
| | |
Uniper SE* | | | 7,462 | | | | 38,206 | |
| | |
Voltalia SA (Registered)* | | | 2,112 | | | | 17,614 | |
| | | | | | | 1,356,769 | |
|
Industrial Conglomerates – 1.0% | |
| | |
Aker ASA, Class A | | | 264 | | | | 15,833 | |
| | |
Arad Investment & Industrial Development Ltd.(a) | | | 920 | | | | 89,486 | |
| | |
Bonheur ASA | | | 5,889 | | | | 101,843 | |
| | |
Brookfield Business Corp., Class A(a) | | | 9,438 | | | | 133,386 | |
| | |
CK Hutchison Holdings Ltd. | | | 58,856 | | | | 297,492 | |
| | |
DCC plc | | | 2,028 | | | | 112,339 | |
| | |
Hikari Tsushin, Inc. | | | 400 | | | | 57,103 | |
| | |
Hitachi Ltd. | | | 14,500 | | | | 907,369 | |
| | |
Infratil Ltd. | | | 8,272 | | | | 47,248 | |
| | |
Investment AB Latour, Class B(a) | | | 2,024 | | | | 34,918 | |
| | |
Italmobiliare SpA(a) | | | 1,024 | | | | 25,814 | |
| | |
Jardine Matheson Holdings Ltd. | | | 3,900 | | | | 157,755 | |
| | |
Keihan Holdings Co. Ltd. | | | 2,500 | | | | 60,600 | |
| | |
Keppel Corp. Ltd. | | | 20,500 | | | | 92,920 | |
| | |
Lifco AB, Class B | | | 4,576 | | | | 83,471 | |
| | |
Nisshinbo Holdings, Inc. | | | 54,100 | | | | 387,232 | |
| | |
Nolato AB, Class B | | | 11,029 | | | | 48,666 | |
| | |
Noritsu Koki Co. Ltd. | | | 7,800 | | | | 163,525 | |
| | |
NWS Holdings Ltd. | | | 44,000 | | | | 52,072 | |
| | |
Siemens AG (Registered) | | | 11,232 | | | | 1,483,553 | |
| | |
Smiths Group plc | | | 5,109 | | | | 100,029 | |
| | |
Storskogen Group AB, Class B(a) | | | 531,609 | | | | 313,370 | |
| | |
TOKAI Holdings Corp.(a) | | | 4,100 | | | | 26,342 | |
| | | | | | | 4,792,366 | |
|
Industrial REITs – 0.3% | |
| | |
AIMS APAC REIT, REIT | | | 55,165 | | | | 48,318 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Industrial REITs – (continued) | |
| | |
ARGAN SA, REIT | | | 533 | | | $ | 36,394 | |
| | |
CapitaLand Ascendas REIT, REIT | | | 57,235 | | | | 108,617 | |
| | |
Centuria Industrial REIT, REIT(a) | | | 20,824 | | | | 37,445 | |
| | |
CRE Logistics REIT, Inc., REIT(a) | | | 44 | | | | 46,195 | |
| | |
Dream Industrial REIT, REIT(a) | | | 7,125 | | | | 60,100 | |
| | |
ESR-LOGOS REIT, REIT | | | 188,600 | | | | 37,856 | |
| | |
GLP J-REIT, REIT | | | 74 | | | | 66,209 | |
| | |
Goodman Group, REIT(a) | | | 24,453 | | | | 321,105 | |
| | |
Goodman Property Trust, REIT(a) | | | 19,085 | | | | 22,313 | |
| | |
Granite REIT, REIT(a) | | | 484 | | | | 22,017 | |
| | |
Japan Logistics Fund, Inc., REIT | | | 19 | | | | 35,116 | |
| | |
LaSalle Logiport REIT, REIT | | | 44 | | | | 43,057 | |
| | |
LondonMetric Property plc, REIT | | | 60,255 | | | | 120,934 | |
| | |
Mapletree Industrial Trust, REIT | | | 35,086 | | | | 55,060 | |
| | |
Mapletree Logistics Trust, REIT | | | 62,253 | | | | 66,795 | |
| | |
Montea NV, REIT | | | 672 | | | | 47,377 | |
| | |
Nippon Prologis REIT, Inc., REIT(a) | | | 41 | | | | 72,771 | |
| | |
Property for Industry Ltd., REIT | | | 26,697 | | | | 32,765 | |
| | |
Segro plc, REIT | | | 20,514 | | | | 177,435 | |
| | |
Tritax Big Box REIT plc, REIT | | | 33,836 | | | | 56,168 | |
| | |
Urban Logistics REIT plc, REIT | | | 29,257 | | | | 36,993 | |
| | |
Warehouses De Pauw CVA, REIT | | | 3,077 | | | | 75,846 | |
| | | | | | | 1,626,886 | |
|
Insurance – 4.3% | |
| | |
Admiral Group plc | | | 4,173 | | | | 123,707 | |
| | |
Aegon Ltd. | | | 29,562 | | | | 143,236 | |
| | |
Ageas SA/NV | | | 3,510 | | | | 134,527 | |
| | |
AIA Group Ltd. | | | 170,800 | | | | 1,481,070 | |
| | |
Allianz SE (Registered) | | | 8,385 | | | | 1,957,824 | |
| | |
Alm Brand A/S | | | 57,708 | | | | 83,358 | |
| | |
ASR Nederland NV | | | 3,210 | | | | 119,432 | |
| | |
Assicurazioni Generali SpA | | | 24,843 | | | | 492,226 | |
| | |
AUB Group Ltd.(a) | | | 5,730 | | | | 97,701 | |
| | |
Aviva plc | | | 57,681 | | | | 278,292 | |
| | |
AXA SA | | | 35,451 | | | | 1,047,522 | |
| | |
Baloise Holding AG (Registered) | | | 936 | | | | 133,913 | |
| | |
Beazley plc | | | 14,268 | | | | 89,078 | |
| | |
Clal Insurance Enterprises Holdings Ltd.* | | | 4,387 | | | | 54,741 | |
| | |
Coface SA | | | 36,387 | | | | 437,687 | |
| | |
Conduit Holdings Ltd. | | | 55,770 | | | | 296,413 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 199 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Dai-ichi Life Holdings, Inc. | | | 19,500 | | | $ | 408,940 | |
| | |
Definity Financial Corp. | | | 1,025 | | | | 28,308 | |
| | |
Direct Line Insurance Group plc* | | | 28,600 | | | | 52,508 | |
| | |
Fairfax Financial Holdings Ltd.(a) | | | 507 | | | | 421,461 | |
| | |
Gjensidige Forsikring ASA | | | 4,360 | | | | 65,292 | |
| | |
Great-West Lifeco, Inc. | | | 5,624 | | | | 155,645 | |
| | |
Grupo Catalana Occidente SA | | | 704 | | | | 22,510 | |
| | |
Hannover Rueck SE | | | 975 | | | | 214,669 | |
| | |
Harel Insurance Investments & Financial Services Ltd.(a) | | | 3,957 | | | | 25,372 | |
| | |
Helvetia Holding AG (Registered) | | | 838 | | | | 112,157 | |
| | |
Hiscox Ltd. | | | 5,060 | | | | 57,594 | |
| | |
iA Financial Corp., Inc. | | | 2,262 | | | | 131,475 | |
| | |
Insurance Australia Group Ltd. | | | 40,287 | | | | 144,629 | |
| | |
Intact Financial Corp. | | | 2,652 | | | | 372,206 | |
| | |
Japan Post Holdings Co. Ltd. | | | 42,900 | | | | 377,884 | |
| | |
Japan Post Insurance Co. Ltd. | | | 4,400 | | | | 84,153 | |
| | |
Just Group plc | | | 349,050 | | | | 320,207 | |
| | |
Lancashire Holdings Ltd. | | | 83,616 | | | | 576,315 | |
| | |
Legal & General Group plc | | | 121,758 | | | | 312,338 | |
| | |
Linea Directa Aseguradora SA Cia de Seguros y Reaseguros(a) | | | 40,084 | | | | 34,488 | |
| | |
Manulife Financial Corp. | | | 37,986 | | | | 660,531 | |
| | |
Mapfre SA | | | 22,440 | | | | 46,537 | |
| | |
Medibank Pvt Ltd. | | | 46,515 | | | | 101,017 | |
| | |
Menora Mivtachim Holdings Ltd. | | | 492 | | | | 9,790 | |
| | |
Migdal Insurance & Financial Holdings Ltd. | | | 135,252 | | | | 127,043 | |
| | |
MS&AD Insurance Group Holdings, Inc. | | | 9,200 | | | | 333,689 | |
| | |
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | | | 2,886 | | | | 1,154,615 | |
| | |
nib holdings Ltd.(a) | | | 11,260 | | | | 51,616 | |
| | |
NN Group NV | | | 5,817 | | | | 186,056 | |
| | |
Phoenix Group Holdings plc | | | 19,656 | | | | 108,238 | |
| | |
Phoenix Holdings Ltd. (The) | | | 5,085 | | | | 43,151 | |
| | |
Poste Italiane SpA(b) | | | 10,869 | | | | 107,303 | |
| | |
Power Corp. of Canada | | | 11,475 | | | | 276,160 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Insurance – (continued) | |
| | |
Powszechny Zaklad Ubezpieczen SA | | | 11,833 | | | $ | 133,690 | |
| | |
Protector Forsikring ASA | | | 4,092 | | | | 64,099 | |
| | |
Prudential plc | | | 39,624 | | | | 412,445 | |
| | |
PSC Insurance Group Ltd. | | | 14,212 | | | | 40,043 | |
| | |
QBE Insurance Group Ltd. | | | 29,484 | | | | 291,218 | |
| | |
Sampo OYJ, Class A | | | 6,357 | | | | 249,355 | |
| | |
SCOR SE | | | 3,124 | | | | 92,953 | |
| | |
Sompo Holdings, Inc. | | | 7,800 | | | | 335,135 | |
| | |
Steadfast Group Ltd. | | | 17,908 | | | | 61,228 | |
| | |
Storebrand ASA | | | 12,259 | | | | 102,205 | |
| | |
Sun Life Financial, Inc. | | | 11,934 | | | | 544,498 | |
| | |
Suncorp Group Ltd. | | | 25,974 | | | | 220,040 | |
| | |
Swiss Life Holding AG (Registered) | | | 624 | | | | 398,927 | |
| | |
Swiss Re AG | | | 5,967 | | | | 649,908 | |
| | |
T&D Holdings, Inc. | | | 11,700 | | | | 206,466 | |
| | |
Talanx AG | | | 968 | | | | 60,828 | |
| | |
Tokio Marine Holdings, Inc. | | | 42,900 | | | | 946,975 | |
| | |
Topdanmark A/S | | | 880 | | | | 39,381 | |
| | |
Trisura Group Ltd.* | | | 3,061 | | | | 67,228 | |
| | |
Tryg A/S | | | 4,880 | | | | 95,128 | |
| | |
Unipol Gruppo SpA | | | 6,080 | | | | 32,853 | |
| | |
UnipolSai Assicurazioni SpA | | | 11,528 | | | | 27,270 | |
| | |
Wuestenrot & Wuerttembergische AG | | | 6,669 | | | | 92,485 | |
| | |
Zurich Insurance Group AG | | | 2,262 | | | | 1,070,290 | |
| | | | | | | 20,329,272 | |
|
Interactive Media & Services – 0.2% | |
| | |
Adevinta ASA* | | | 1,107 | | | | 9,716 | |
| | |
Auto Trader Group plc(b) | | | 14,118 | | | | 106,421 | |
| | |
Baltic Classifieds Group plc | | | 16,280 | | | | 38,996 | |
| | |
Better Collective A/S* | | | 2,464 | | | | 59,545 | |
| | |
carsales.com Ltd. | | | 6,510 | | | | 113,885 | |
| | |
Domain Holdings Australia Ltd.(a) | | | 12,956 | | | | 27,726 | |
| | |
Hemnet Group AB | | | 2,993 | | | | 51,890 | |
| | |
Infocom Corp. | | | 1,600 | | | | 26,381 | |
| | |
Kakaku.com, Inc. | | | 1,600 | | | | 15,309 | |
| | |
Karnov Group AB* | | | 5,418 | | | | 23,762 | |
| | |
LY Corp. | | | 38,600 | | | | 97,440 | |
See Accompanying Notes to the Financial Statements.
| | | | |
200 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Interactive Media & Services – (continued) | |
| | |
Moneysupermarket.com Group plc | | | 29,179 | | | $ | 91,705 | |
| | |
New Work SE | | | 159 | | | | 11,361 | |
| | |
REA Group Ltd.(a) | | | 1,030 | | | | 93,720 | |
| | |
Rightmove plc | | | 13,244 | | | | 76,015 | |
| | |
Scout24 SE(b) | | | 1,232 | | | | 75,555 | |
| | |
SEEK Ltd.(a) | | | 5,397 | | | | 70,427 | |
| | |
Wirtualna Polska Holding SA(b) | | | 1,107 | | | | 28,213 | |
| | | | | | | 1,018,067 | |
|
IT Services – 1.1% | |
| | |
Addnode Group AB, Class B | | | 9,440 | | | | 58,680 | |
| | |
Adesso SE | | | 220 | | | | 20,719 | |
| | |
Alten SA | | | 616 | | | | 72,469 | |
| | |
Atea ASA | | | 2,420 | | | | 25,171 | |
| | |
Atos SE* (a) | | | 38,610 | | | | 268,861 | |
| | |
Bechtle AG | | | 1,364 | | | | 60,669 | |
| | |
BIPROGY, Inc. | | | 1,100 | | | | 27,238 | |
| | |
CANCOM SE | | | 1,981 | | | | 49,249 | |
| | |
Capgemini SE | | | 2,262 | | | | 398,091 | |
| | |
CGI, Inc.* | | | 3,081 | | | | 297,125 | |
| | |
Change Holdings, Inc.(a) | | | 3,500 | | | | 35,175 | |
| | |
Computacenter plc | | | 1,092 | | | | 34,002 | |
| | |
Data#3 Ltd.(a) | | | 12,760 | | | | 54,695 | |
| | |
Digital Garage, Inc. | | | 1,300 | | | | 25,752 | |
| | |
DTS Corp. | | | 2,100 | | | | 42,639 | |
| | |
Econocom Group SA/NV | | | 34,295 | | | | 83,918 | |
| | |
FDM Group Holdings plc | | | 5,818 | | | | 30,816 | |
| | |
Formula Systems 1985 Ltd. | | | 389 | | | | 22,029 | |
| | |
Fujitsu Ltd. | | | 2,600 | | | | 333,316 | |
| | |
Future Corp. | | | 3,400 | | | | 38,368 | |
| | |
GFT Technologies SE | | | 924 | | | | 27,523 | |
| | |
GMO internet group, Inc. | | | 1,200 | | | | 17,293 | |
| | |
Indra Sistemas SA(a) | | | 39,507 | | | | 553,305 | |
| | |
Kainos Group plc | | | 4,469 | | | | 60,845 | |
| | |
Keywords Studios plc | | | 4,346 | | | | 68,821 | |
| | |
KNOW IT AB | | | 1,144 | | | | 14,335 | |
| | |
Kontron AG | | | 3,168 | | | | 63,623 | |
| | |
Matrix IT Ltd. | | | 11,427 | | | | 192,834 | |
| | |
Megaport Ltd.* (a) | | | 10,561 | | | | 63,591 | |
| | |
NEC Corp. | | | 3,900 | | | | 185,543 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
IT Services – (continued) | |
| | |
NEC Networks & System Integration Corp. | | | 2,400 | | | $ | 32,186 | |
| | |
NET One Systems Co. Ltd. | | | 2,300 | | | | 34,869 | |
| | |
Netcompany Group A/S* (a) (b) | | | 1,886 | | | | 58,813 | |
| | |
NEXTDC Ltd.* | | | 12,078 | | | | 89,854 | |
| | |
Nomura Research Institute Ltd. | | | 6,245 | | | | 162,635 | |
| | |
NS Solutions Corp. | | | 800 | | | | 23,084 | |
| | |
NTT Data Group Corp. | | | 9,400 | | | | 114,424 | |
| | |
Obic Co. Ltd. | | | 800 | | | | 117,508 | |
| | |
One Software Technologies Ltd. | | | 3,880 | | | | 39,351 | |
| | |
Otsuka Corp. | | | 2,500 | | | | 99,426 | |
| | |
Reply SpA | | | 484 | | | | 45,455 | |
| | |
SCSK Corp. | | | 2,700 | | | | 45,792 | |
| | |
Secunet Security Networks AG | | | 123 | | | | 16,667 | |
| | |
SHIFT, Inc.* | | | 300 | | | | 53,782 | |
| | |
Shopify, Inc., Class A* | | | 17,940 | | | | 846,311 | |
| | |
Simplex Holdings, Inc. | | | 4,100 | | | | 67,952 | |
| | |
Societe pour l’Informatique Industrielle | | | 656 | | | | 31,133 | |
| | |
Softcat plc | | | 369 | | | | 5,664 | |
| | |
Sopra Steria Group SACA | | | 396 | | | | 70,864 | |
| | |
SUNeVision Holdings Ltd. | | | 90,000 | | | | 33,471 | |
| | |
TechMatrix Corp. | | | 3,300 | | | | 32,380 | |
| | |
TietoEVRY OYJ | | | 2,254 | | | | 47,125 | |
| | |
TIS, Inc. | | | 4,600 | | | | 97,349 | |
| | | | | | | 5,392,790 | |
|
Leisure Products – 0.5% | |
| | |
Bandai Namco Holdings, Inc. | | | 11,700 | | | | 239,724 | |
| | |
Beneteau SACA | | | 13,143 | | | | 158,093 | |
| | |
BRP, Inc.(a) | | | 12,207 | | | | 824,176 | |
| | |
Games Workshop Group plc | | | 684 | | | | 81,962 | |
| | |
MIPS AB(b) | | | 1,517 | | | | 37,271 | |
| | |
Mizuno Corp. | | | 7,800 | | | | 226,102 | |
| | |
Sanlorenzo SpA(a) | | | 984 | | | | 34,947 | |
| | |
Sega Sammy Holdings, Inc. | | | 2,600 | | | | 40,276 | |
| | |
Shimano, Inc. | | | 1,100 | | | | 156,562 | |
| | |
Spin Master Corp.(b) | | | 1,936 | | | | 46,230 | |
| | |
Technogym SpA(b) | | | 4,905 | | | | 36,836 | |
| | |
Thule Group AB(b) | | | 2,024 | | | | 45,887 | |
| | |
Tomy Co. Ltd. | | | 4,600 | | | | 62,920 | |
| | |
Universal Entertainment Corp. | | | 300 | | | | 4,241 | |
| | |
Yamaha Corp. | | | 2,800 | | | | 73,566 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 201 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Leisure Products – (continued) | |
| | |
Yonex Co. Ltd.(a) | | | 5,600 | | | $ | 60,088 | |
| | | | | | | 2,128,881 | |
|
Life Sciences Tools & Services – 0.3% | |
| | |
AddLife AB, Class B | | | 6,847 | | | | 44,553 | |
| | |
Bachem Holding AG(a) | | | 328 | | | | 23,644 | |
| | |
Biotage AB | | | 3,690 | | | | 37,585 | |
| | |
Chemometec A/S | | | 902 | | | | 37,172 | |
| | |
Eurofins Scientific SE(a) | | | 1,950 | | | | 98,585 | |
| | |
Evotec SE* | | | 3,042 | | | | 52,314 | |
| | |
Gerresheimer AG | | | 574 | | | | 53,331 | |
| | |
Lonza Group AG (Registered) | | | 1,092 | | | | 380,139 | |
| | |
Oxford Nanopore Technologies plc* | | | 35,096 | | | | 86,708 | |
| | |
QIAGEN NV* | | | 3,377 | | | | 125,360 | |
| | |
Sartorius AG (Preference) | | | 390 | | | | 97,369 | |
| | |
Sartorius Stedim Biotech | | | 390 | | | | 72,779 | |
| | |
Siegfried Holding AG (Registered) | | | 88 | | | | 69,574 | |
| | |
SKAN Group AG | | | 451 | | | | 33,749 | |
| | |
Tecan Group AG (Registered) | | | 220 | | | | 62,950 | |
| | |
Wuxi Biologics Cayman, Inc.* (b) | | | 55,500 | | | | 344,720 | |
| | | | | | | 1,620,532 | |
|
Machinery – 3.4% | |
| | |
Aalberts NV | | | 1,454 | | | | 45,215 | |
| | |
Alfa Laval AB | | | 4,680 | | | | 151,048 | |
| | |
Alstom SA(a) | | | 6,346 | | | | 85,523 | |
| | |
Amada Co. Ltd. | | | 7,200 | | | | 68,936 | |
| | |
ANDRITZ AG | | | 1,517 | | | | 69,591 | |
| | |
Atlas Copco AB, Class A | | | 38,142 | | | | 492,280 | |
| | |
Atlas Copco AB, Class B | | | 24,609 | | | | 275,437 | |
| | |
ATS Corp.* | | | 1,476 | | | | 49,652 | |
| | |
AutoStore Holdings Ltd.* (b) | | | 15,006 | | | | 16,548 | |
| | |
Beijer Alma AB | | | 2,304 | | | | 36,583 | |
| | |
Bodycote plc | | | 11,283 | | | | 78,588 | |
| | |
Bucher Industries AG (Registered) | | | 82 | | | | 29,140 | |
| | |
Burckhardt Compression Holding AG | | | 132 | | | | 66,722 | |
| | |
Bystronic AG | | | 55 | | | | 26,229 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Machinery – (continued) | |
| | |
Cargotec OYJ, Class B | | | 684 | | | $ | 26,910 | |
| | |
CKD Corp. | | | 4,100 | | | | 50,978 | |
| | |
CNH Industrial NV | | | 19,227 | | | | 212,680 | |
| | |
Concentric AB | | | 902 | | | | 12,643 | |
| | |
Construcciones y Auxiliar de Ferrocarriles SA(a) | | | 5,967 | | | | 177,861 | |
| | |
Daetwyler Holding AG | | | 176 | | | | 30,905 | |
| | |
Daifuku Co. Ltd. | | | 6,900 | | | | 112,376 | |
| | |
Daimler Truck Holding AG | | | 11,154 | | | | 349,213 | |
| | |
Danieli & C Officine Meccaniche SpA(a) | | | 4,095 | | | | 108,210 | |
| | |
Danieli & C Officine Meccaniche SpA (Retirement Savings Plan) | | | 13,221 | | | | 266,356 | |
| | |
DMG Mori Co. Ltd. | | | 2,100 | | | | 34,243 | |
| | |
Duerr AG | | | 3,240 | | | | 66,336 | |
| | |
Ebara Corp. | | | 1,100 | | | | 47,938 | |
| | |
Electrolux Professional AB, Class B | | | 13,038 | | | | 52,583 | |
| | |
Epiroc AB, Class A | | | 9,048 | | | | 148,605 | |
| | |
Epiroc AB, Class B | | | 6,280 | | | | 86,955 | |
| | |
FANUC Corp. | | | 14,900 | | | | 359,402 | |
| | |
FLSmidth & Co. A/S(a) | | | 2,730 | | | | 102,143 | |
| | |
Fluidra SA | | | 912 | | | | 16,021 | |
| | |
Fuji Corp. | | | 1,000 | | | | 14,900 | |
| | |
Fujitec Co. Ltd. | | | 2,400 | | | | 51,551 | |
| | |
GEA Group AG | | | 2,886 | | | | 98,318 | |
| | |
Georg Fischer AG (Registered) | | | 1,517 | | | | 78,213 | |
| | |
Giken Ltd.(a) | | | 1,200 | | | | 14,104 | |
| | |
Glory Ltd. | | | 4,200 | | | | 77,555 | |
| | |
Harmonic Drive Systems, Inc. | | | 1,500 | | | | 32,091 | |
| | |
Hitachi Construction Machinery Co. Ltd. | | | 2,800 | | | | 71,218 | |
| | |
Hitachi Zosen Corp. | | | 58,500 | | | | 301,684 | |
| | |
Hoshizaki Corp. | | | 2,400 | | | | 76,828 | |
| | |
Husqvarna AB, Class B | | | 7,480 | | | | 48,270 | |
| | |
IHI Corp. | | | 2,500 | | | | 47,278 | |
| | |
IMI plc | | | 3,784 | | | | 67,268 | |
| | |
Indutrade AB | | | 4,894 | | | | 86,358 | |
| | |
Interpump Group SpA | | | 1,584 | | | | 65,967 | |
| | |
Iveco Group NV* | | | 68,328 | | | | 574,459 | |
| | |
Japan Steel Works Ltd. (The) | | | 900 | | | | 14,399 | |
| | |
Jungheinrich AG (Preference) | | | 3,036 | | | | 81,317 | |
| | |
Kardex Holding AG (Registered) | | | 264 | | | | 50,882 | |
See Accompanying Notes to the Financial Statements.
| | | | |
202 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
Kawasaki Heavy Industries Ltd. | | | 2,800 | | | $ | 60,864 | |
| | |
KION Group AG | | | 1,419 | | | | 43,257 | |
| | |
Kitz Corp.(a) | | | 27,300 | | | | 182,246 | |
| | |
Komatsu Ltd. | | | 19,500 | | | | 445,895 | |
| | |
Komax Holding AG (Registered) | | | 258 | | | | 50,973 | |
| | |
Kone OYJ, Class B | | | 5,460 | | | | 235,985 | |
| | |
Konecranes OYJ | | | 1,394 | | | | 45,545 | |
| | |
Krones AG | | | 246 | | | | 23,870 | |
| | |
KSB SE & Co. KGaA (Preference) | | | 273 | | | | 152,360 | |
| | |
Kubota Corp. | | | 15,600 | | | | 207,458 | |
| | |
Kurita Water Industries Ltd. | | | 2,500 | | | | 74,912 | |
| | |
Kyokuto Kaihatsu Kogyo Co. Ltd. | | | 11,700 | | | | 141,146 | |
| | |
Makino Milling Machine Co. Ltd.(a) | | | 7,800 | | | | 321,384 | |
| | |
Makita Corp. | | | 4,400 | | | | 112,175 | |
| | |
Manitou BF SA | | | 3,958 | | | | 83,421 | |
| | |
Max Co. Ltd. | | | 2,800 | | | | 46,758 | |
| | |
Meidensha Corp. | | | 15,600 | | | | 241,759 | |
| | |
METAWATER Co. Ltd. | | | 4,100 | | | | 51,194 | |
| | |
Metso OYJ | | | 12,051 | | | | 105,801 | |
| | |
MINEBEA MITSUMI, Inc. | | | 7,311 | | | | 112,457 | |
| | |
MISUMI Group, Inc. | | | 4,100 | | | | 61,170 | |
| | |
Mitsubishi Heavy Industries Ltd. | | | 7,800 | | | | 396,168 | |
| | |
Mitsubishi Logisnext Co. Ltd. | | | 4,300 | | | | 33,334 | |
| | |
Mitsuboshi Belting Ltd. | | | 1,300 | | | | 37,169 | |
| | |
Miura Co. Ltd. | | | 2,100 | | | | 40,261 | |
| | |
Morgan Advanced Materials plc | | | 19,516 | | | | 53,284 | |
| | |
Morita Holdings Corp. | | | 15,600 | | | | 158,632 | |
| | |
Nabtesco Corp. | | | 2,900 | | | | 50,745 | |
| | |
Nachi-Fujikoshi Corp. | | | 7,800 | | | | 192,624 | |
| | |
NGK Insulators Ltd. | | | 4,100 | | | | 49,597 | |
| | |
Nikkiso Co. Ltd. | | | 4,100 | | | | 25,908 | |
| | |
Nitta Corp. | | | 7,800 | | | | 174,598 | |
| | |
Noritake Co. Ltd.(a) | | | 3,900 | | | | 150,649 | |
| | |
NTN Corp. | | | 175,500 | | | | 307,208 | |
| | |
OC Oerlikon Corp. AG (Registered)(a) | | | 60,723 | | | | 241,010 | |
| | |
Organo Corp. | | | 7,800 | | | | 253,141 | |
| | |
OSG Corp. | | | 1,600 | | | | 18,066 | |
| | |
Palfinger AG | | | 787 | | | | 19,008 | |
| | |
Pfeiffer Vacuum Technology AG | | | 220 | | | | 33,904 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Machinery – (continued) | |
| | |
Rational AG | | | 55 | | | $ | 31,248 | |
| | |
Rotork plc | | | 13,640 | | | | 48,463 | |
| | |
Sandvik AB | | | 16,224 | | | | 275,321 | |
| | |
Schindler Holding AG | | | 626 | | | | 126,019 | |
| | |
Schindler Holding AG (Registered) | | | 400 | | | | 77,578 | |
| | |
Seatrium Ltd.* | | | 649,543 | | | | 53,099 | |
| | |
SFS Group AG | | | 220 | | | | 21,854 | |
| | |
Shibaura Machine Co. Ltd.(a) | | | 7,800 | | | | 190,049 | |
| | |
Shibuya Corp. | | | 7,800 | | | | 126,081 | |
| | |
Shima Seiki Manufacturing Ltd. | | | 4,100 | | | | 41,286 | |
| | |
Shinmaywa Industries Ltd.(a) | | | 19,500 | | | | 154,383 | |
| | |
SKF AB, Class A | | | 1,408 | | | | 22,709 | |
| | |
SKF AB, Class B | | | 5,760 | | | | 92,850 | |
| | |
SMC Corp. | | | 900 | | | | 408,148 | |
| | |
Spirax-Sarco Engineering plc | | | 1,092 | | | | 108,551 | |
| | |
Stabilus SE | | | 1,516 | | | | 95,985 | |
| | |
Stadler Rail AG | | | 1,056 | | | | 35,647 | |
| | |
Star Micronics Co. Ltd. | | | 11,700 | | | | 139,138 | |
| | |
Sulzer AG (Registered) | | | 280 | | | | 22,983 | |
| | |
Sumitomo Heavy Industries Ltd. | | | 3,300 | | | | 74,587 | |
| | |
Tadano Ltd. | | | 8,900 | | | | 65,966 | |
| | |
Takeuchi Manufacturing Co. Ltd. | | | 2,600 | | | | 72,964 | |
| | |
Takuma Co. Ltd.(a) | | | 27,500 | | | | 263,660 | |
| | |
Techtronic Industries Co. Ltd. | | | 19,500 | | | | 177,690 | |
| | |
THK Co. Ltd. | | | 1,700 | | | | 29,971 | |
| | |
Tocalo Co. Ltd. | | | 3,800 | | | | 33,949 | |
| | |
TOMRA Systems ASA | | | 3,872 | | | | 30,604 | |
| | |
Toyota Industries Corp. | | | 3,900 | | | | 284,688 | |
| | |
Trelleborg AB, Class B | | | 4,454 | | | | 112,260 | |
| | |
Troax Group AB | | | 1,806 | | | | 28,837 | |
| | |
Tsubakimoto Chain Co. | | | 10,000 | | | | 250,586 | |
| | |
Tsugami Corp. | | | 19,500 | | | | 137,773 | |
| | |
Union Tool Co. | | | 500 | | | | 11,753 | |
| | |
Valmet OYJ(a) | | | 3,228 | | | | 72,198 | |
| | |
VAT Group AG(b) | | | 429 | | | | 151,179 | |
| | |
Vesuvius plc | | | 74,763 | | | | 365,606 | |
| | |
Volvo AB, Class A | | | 3,212 | | | | 64,225 | |
| | |
Volvo AB, Class B | | | 33,150 | | | | 655,425 | |
| | |
Wacker Neuson SE | | | 10,023 | | | | 183,282 | |
| | |
Wartsila OYJ Abp | | | 5,720 | | | | 67,958 | |
| | |
Weir Group plc (The) | | | 3,920 | | | | 81,197 | |
| | |
Yaskawa Electric Corp. | | | 3,900 | | | | 125,592 | |
| | | | | | | 16,055,788 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 203 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Marine Transportation – 0.8% | |
| | |
AP Moller – Maersk A/S, Class A | | | 65 | | | $ | 105,858 | |
| | |
AP Moller – Maersk A/S, Class B | | | 117 | | | | 194,272 | |
| | |
Clarkson plc | | | 1,408 | | | | 45,191 | |
| | |
D/S Norden A/S | | | 7,839 | | | | 444,717 | |
| | |
Dfds A/S | | | 11,154 | | | | 321,604 | |
| | |
Golden Ocean Group Ltd. | | | 4,796 | | | | 35,417 | |
| | |
Gram Car Carriers ASA | | | 4,879 | | | | 89,529 | |
| | |
Hoegh Autoliners ASA | | | 25,350 | | | | 204,902 | |
| | |
Iino Kaiun Kaisha Ltd. | | | 35,100 | | | | 248,455 | |
| | |
Irish Continental Group plc | | | 7,708 | | | | 35,034 | |
| | |
Kawasaki Kisen Kaisha Ltd.(a) | | | 5,900 | | | | 200,361 | |
| | |
Kuehne + Nagel International AG (Registered)(a) | | | 780 | | | | 209,560 | |
| | |
Mitsui OSK Lines Ltd.(a) | | | 8,900 | | | | 228,193 | |
| | |
MPC Container Ships ASA | | | 111,618 | | | | 157,610 | |
| | |
Nippon Yusen KK(a) | | | 11,700 | | | | 284,070 | |
| | |
NS United Kaiun Kaisha Ltd.(a) | | | 4,000 | | | | 112,780 | |
| | |
Odfjell SE, Class A | | | 11,760 | | | | 124,740 | |
| | |
Pacific Basin Shipping Ltd. | | | 1,755,000 | | | | 506,901 | |
| | |
SITC International Holdings Co. Ltd. | | | 24,000 | | | | 36,930 | |
| | |
Stolt-Nielsen Ltd. | | | 1,435 | | | | 47,205 | |
| | |
Wallenius Wilhelmsen ASA | | | 2,952 | | | | 24,772 | |
| | |
Wilh Wilhelmsen Holding ASA, Class A | | | 5,187 | | | | 145,790 | |
| | |
Wilh Wilhelmsen Holding ASA, Class B | | | 2,091 | | | | 58,771 | |
| | | | | | | 3,862,662 | |
|
Media – 1.0% | |
| | |
4imprint Group plc | | | 1,517 | | | | 92,408 | |
| | |
Ascential plc* | | | 26,292 | | | | 83,525 | |
| | |
Atresmedia Corp. de Medios de Comunicacion SA | | | 32,019 | | | | 119,740 | |
| | |
Cogeco Communications, Inc. | | | 5,460 | | | | 214,821 | |
| | |
CyberAgent, Inc. | | | 6,300 | | | | 32,851 | |
| | |
Dentsu Group, Inc. | | | 3,900 | | | | 112,021 | |
| | |
Eutelsat Communications SACA(a) | | | 48,594 | | | | 206,996 | |
| | |
Future plc | | | 38,649 | | | | 414,818 | |
| | |
Hakuhodo DY Holdings, Inc. | | | 4,700 | | | | 37,660 | |
| | |
Informa plc | | | 18,720 | | | | 161,646 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Media – (continued) | |
| | |
IPSOS SA | | | 12,909 | | | $ | 625,751 | |
| | |
ITV plc | | | 84,280 | | | | 65,309 | |
| | |
JCDecaux SE* | | | 968 | | | | 15,102 | |
| | |
Kadokawa Corp. | | | 2,200 | | | | 41,902 | |
| | |
Lagardere SA(a) | | | 1,722 | | | | 34,110 | |
| | |
Metropole Television SA | | | 23,322 | | | | 291,626 | |
| | |
MFE-MediaForEurope NV, Class A(a) | | | 59,459 | | | | 107,748 | |
| | |
MFE-MediaForEurope NV, Class B(a) | | | 21,558 | | | | 57,081 | |
| | |
Next 15 Group plc | | | 5,104 | | | | 39,143 | |
| | |
Nine Entertainment Co. Holdings Ltd.(a) | | | 34,440 | | | | 40,231 | |
| | |
oOh!media Ltd.(a) | | | 47,520 | | | | 39,264 | |
| | |
ProSiebenSat.1 Media SE | | | 60,333 | | | | 336,588 | |
| | |
Publicis Groupe SA | | | 3,627 | | | | 274,956 | |
| | |
RTL Group SA(a) | | | 1,056 | | | | 36,790 | |
| | |
S4 Capital plc* (a) | | | 22,509 | | | | 17,330 | |
| | |
Sanoma OYJ | | | 3,895 | | | | 30,095 | |
| | |
Schibsted ASA, Class A | | | 2,870 | | | | 57,340 | |
| | |
SES SA, Class A, ADR | | | 17,940 | | | | 104,389 | |
| | |
SKY Perfect JSAT Holdings, Inc. | | | 54,600 | | | | 250,206 | |
| | |
Stroeer SE & Co. KGaA | | | 620 | | | | 28,337 | |
| | |
Television Francaise 1 SA(a) | | | 29,796 | | | | 209,752 | |
| | |
TV Asahi Holdings Corp. | | | 8,400 | | | | 89,799 | |
| | |
TX Group AG | | | 205 | | | | 19,035 | |
| | |
Viaplay Group AB, Class B* (a) | | | 1,188 | | | | 2,533 | |
| | |
Vivendi SE | | | 11,795 | | | | 105,424 | |
| | |
WPP plc | | | 21,684 | | | | 185,924 | |
| | |
YouGov plc | | | 4,715 | | | | 48,632 | |
| | | | | | | 4,630,883 | |
|
Metals & Mining – 5.0% | |
| | |
Acerinox SA | | | 66,924 | | | | 650,654 | |
| | |
Agnico Eagle Mines Ltd. | | | 7,421 | | | | 347,676 | |
| | |
Alamos Gold, Inc., Class A | | | 4,007 | | | | 49,559 | |
| | |
Alleima AB | | | 73,788 | | | | 448,435 | |
| | |
Allkem Ltd.* (a) | | | 8,316 | | | | 50,231 | |
| | |
Alumina Ltd.* | | | 7,667 | | | | 3,786 | |
| | |
AMG Critical Materials NV | | | 10,920 | | | | 283,713 | |
| | |
Anglo American plc | | | 27,456 | | | | 698,480 | |
| | |
Antofagasta plc | | | 5,371 | | | | 87,660 | |
| | |
Aperam SA(a) | | | 1,640 | | | | 45,330 | |
See Accompanying Notes to the Financial Statements.
| | | | |
204 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
ArcelorMittal SA | | | 10,881 | | | $ | 240,145 | |
| | |
ARE Holdings, Inc.(a) | | | 27,300 | | | | 344,303 | |
| | |
Aurubis AG | | | 738 | | | | 60,580 | |
| | |
AVZ Minerals Ltd.* ‡ (a) | | | 111,012 | | | | 13,355 | |
| | |
Aya Gold & Silver, Inc.* | | | 5,002 | | | | 27,059 | |
| | |
B2Gold Corp. | | | 28,059 | | | | 89,740 | |
| | |
Barrick Gold Corp. | | | 25,662 | | | | 411,585 | |
| | |
Bekaert SA | | | 11,817 | | | | 477,140 | |
| | |
Bellevue Gold Ltd.* (a) | | | 49,941 | | | | 45,691 | |
| | |
BHP Group Ltd. | | | 107,757 | | | | 3,036,072 | |
| | |
BlueScope Steel Ltd. | | | 9,711 | | | | 115,592 | |
| | |
Boliden AB | | | 5,577 | | | | 142,637 | |
| | |
Capricorn Metals Ltd.* (a) | | | 19,272 | | | | 57,716 | |
| | |
Capstone Copper Corp.* | | | 7,626 | | | | 25,928 | |
| | |
Centamin plc | | | 402,129 | | | | 402,326 | |
| | |
Centerra Gold, Inc. | | | 17,010 | | | | 86,382 | |
| | |
Chalice Mining Ltd.* (a) | | | 6,068 | | | | 6,877 | |
| | |
Champion Iron Ltd.(a) | | | 6,468 | | | | 29,158 | |
| | |
Chubu Steel Plate Co. Ltd. | | | 7,800 | | | | 105,222 | |
| | |
Core Lithium Ltd.* (a) | | | 98,236 | | | | 22,391 | |
| | |
De Grey Mining Ltd.* (a) | | | 86,240 | | | | 65,250 | |
| | |
Deterra Royalties Ltd. | | | 29,807 | | | | 88,700 | |
| | |
Dowa Holdings Co. Ltd. | | | 1,100 | | | | 33,252 | |
| | |
Dundee Precious Metals, Inc.(a) | | | 66,222 | | | | 433,609 | |
| | |
Eldorado Gold Corp.* | | | 9,840 | | | | 106,321 | |
| | |
Emerald Resources NL* | | | 21,402 | | | | 35,096 | |
| | |
Endeavour Mining plc | | | 3,344 | | | | 68,982 | |
| | |
Equinox Gold Corp.* (a) | | | 14,247 | | | | 62,294 | |
| | |
Eramet SA | | | 3,627 | | | | 250,151 | |
| | |
ERO Copper Corp.* (a) | | | 4,268 | | | | 57,860 | |
| | |
Evolution Mining Ltd. | | | 35,786 | | | | 80,889 | |
| | |
Falcon Metals Ltd.* | | | 1 | | | | — | (e) |
| | |
Ferrexpo plc* | | | 104,040 | | | | 95,632 | |
| | |
Filo Corp.* | | | 4,428 | | | | 57,605 | |
| | |
First Majestic Silver Corp.(a) | | | 14,596 | | | | 75,070 | |
| | |
First Quantum Minerals Ltd.(a) | | | 8,697 | | | | 100,674 | |
| | |
Fortescue Metals Group Ltd.(a) | | | 35,958 | | | | 507,700 | |
| | |
Fortuna Silver Mines, Inc.* | | | 9,512 | | | | 26,653 | |
| | |
Franco-Nevada Corp. | | | 2,821 | | | | 342,808 | |
| | |
Fresnillo plc | | | 3,872 | | | | 26,020 | |
| | |
Glencore plc | | | 233,571 | | | | 1,233,331 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Gold Road Resources Ltd.(a) | | | 59,580 | | | $ | 71,485 | |
| | |
Granges AB | | | 37,167 | | | | 356,945 | |
| | |
Grupa Kety SA | | | 308 | | | | 51,894 | |
| | |
Hill & Smith plc | | | 3,280 | | | | 65,592 | |
| | |
Hudbay Minerals, Inc. | | | 119,301 | | | | 519,914 | |
| | |
IAMGOLD Corp.* | | | 25,911 | | | | 66,259 | |
| | |
IGO Ltd. | | | 10,332 | | | | 62,212 | |
| | |
Iluka Resources Ltd. | | | 9,909 | | | | 45,423 | |
| | |
Imdex Ltd. | | | 25,872 | | | | 27,028 | |
| | |
Ivanhoe Mines Ltd., Class A* (a) | | | 10,250 | | | | 75,458 | |
| | |
Jastrzebska Spolka Weglowa SA* | | | 18,681 | | | | 221,388 | |
| | |
JFE Holdings, Inc. | | | 11,700 | | | | 161,040 | |
| | |
K92 Mining, Inc.* (a) | | | 16,544 | | | | 59,586 | |
| | |
KGHM Polska Miedz SA | | | 3,160 | | | | 84,174 | |
| | |
Kinross Gold Corp. | | | 21,865 | | | | 114,030 | |
| | |
Kobe Steel Ltd.(a) | | | 10,800 | | | | 125,654 | |
| | |
Kyoei Steel Ltd.(a) | | | 7,800 | | | | 97,754 | |
| | |
Labrador Iron Ore Royalty Corp. | | | 22,074 | | | | 484,968 | |
| | |
Liontown Resources Ltd.* (a) | | | 27,470 | | | | 28,002 | |
| | |
Lithium Americas Corp.* (a) | | | 2,508 | | | | 13,857 | |
| | |
Lundin Gold, Inc. | | | 6,342 | | | | 76,383 | |
| | |
Lundin Mining Corp. | | | 12,726 | | | | 79,386 | |
| | |
Lynas Rare Earths Ltd.* (a) | | | 13,899 | | | | 62,041 | |
| | |
MAG Silver Corp.* | | | 4,656 | | | | 46,518 | |
| | |
Maruichi Steel Tube Ltd. | | | 2,000 | | | | 49,166 | |
| | |
Mineral Resources Ltd.(a) | | | 2,808 | | | | 102,691 | |
| | |
Mitsubishi Materials Corp. | | | 4,100 | | | | 65,164 | |
| | |
Mitsui Mining & Smelting Co. Ltd. | | | 19,500 | | | | 502,034 | |
| | |
Nickel Industries Ltd.(a) | | | 886,548 | | | | 418,182 | |
| | |
Nippon Light Metal Holdings Co. Ltd. | | | 19,500 | | | | 212,453 | |
| | |
Nippon Steel Corp. | | | 19,415 | | | | 414,337 | |
| | |
Nittetsu Mining Co. Ltd.(a) | | | 3,900 | | | | 121,420 | |
| | |
Norsk Hydro ASA | | | 28,470 | | | | 162,282 | |
| | |
Northern Star Resources Ltd. | | | 16,700 | | | | 123,605 | |
| | |
Novagold Resources, Inc.* | | | 7,749 | | | | 26,960 | |
| | |
OceanaGold Corp. | | | 237,716 | | | | 397,264 | |
| | |
Orla Mining Ltd.* (a) | | | 10,780 | | | | 33,002 | |
| | |
OSAKA Titanium Technologies Co. Ltd.(a) | | | 1,300 | | | | 27,297 | |
| | |
Osisko Gold Royalties Ltd. | | | 8,590 | | | | 104,881 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 205 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Osisko Mining, Inc.* | | | 17,794 | | | $ | 34,479 | |
| | |
Outokumpu OYJ(a) | | | 7,392 | | | | 30,261 | |
| | |
Pan American Silver Corp.(a) | | | 6,630 | | | | 96,758 | |
| | |
Perseus Mining Ltd. | | | 37,802 | | | | 40,808 | |
| | |
Pilbara Minerals Ltd.(a) | | | 34,446 | | | | 80,041 | |
| | |
Regis Resources Ltd.* | | | 40,098 | | | | 43,921 | |
| | |
Resolute Mining Ltd.* | | | 109,347 | | | | 24,924 | |
| | |
Rio Tinto Ltd. | | | 7,761 | | | | 577,774 | |
| | |
Rio Tinto plc | | | 23,517 | | | | 1,499,604 | |
| | |
Salzgitter AG | | | 13,221 | | | | 328,683 | |
| | |
Sandfire Resources Ltd.* (a) | | | 11,931 | | | | 45,098 | |
| | |
Sandstorm Gold Ltd. | | | 13,772 | | | | 62,995 | |
| | |
Sanyo Special Steel Co. Ltd. | | | 8,200 | | | | 137,691 | |
| | |
Sayona Mining Ltd.* (a) | | | 407,175 | | | | 19,335 | |
| | |
Seabridge Gold, Inc.* | | | 5,588 | | | | 61,062 | |
| | |
Silver Lake Resources Ltd.* (a) | | | 2,337 | | | | 1,554 | |
| | |
SilverCrest Metals, Inc.* (a) | | | 9,416 | | | | 46,597 | |
| | |
Sims Ltd.(a) | | | 3,192 | | | | 25,222 | |
| | |
South32 Ltd. | | | 97,266 | | | | 204,459 | |
| | |
SSAB AB, Class A | | | 6,150 | | | | 36,792 | |
| | |
SSAB AB, Class B | | | 12,333 | | | | 71,442 | |
| | |
SSR Mining, Inc. | | | 3,864 | | | | 53,413 | |
| | |
Stelco Holdings, Inc. | | | 11,856 | | | | 333,753 | |
| | |
Straits Trading Co. Ltd. | | | 53,300 | | | | 74,695 | |
| | |
Sumitomo Metal Mining Co. Ltd. | | | 5,700 | | | | 158,679 | |
| | |
Teck Resources Ltd., Class B | | | 9,438 | | | | 333,126 | |
| | |
thyssenkrupp AG | | | 8,316 | | | | 57,645 | |
| | |
Toho Titanium Co. Ltd.(a) | | | 1,700 | | | | 21,822 | |
| | |
Tokyo Steel Manufacturing Co. Ltd. | | | 4,100 | | | | 46,890 | |
| | |
UACJ Corp. | | | 10,700 | | | | 215,491 | |
| | |
voestalpine AG | | | 1,880 | | | | 46,817 | |
| | |
Vulcan Energy Resources Ltd.* (a) | | | 6,732 | | | | 8,823 | |
| | |
Wesdome Gold Mines Ltd.* | | | 8,888 | | | | 47,505 | |
| | |
West African Resources Ltd.* (a) | | | 335,049 | | | | 156,981 | |
| | |
Wheaton Precious Metals Corp.(a) | | | 6,591 | | | | 278,073 | |
| | |
Yamato Kogyo Co. Ltd. | | | 1,300 | | | | 61,616 | |
| | |
Yodogawa Steel Works Ltd. | | | 10,700 | | | | 247,991 | |
| | |
Zimplats Holdings Ltd. | | | 2,255 | | | | 28,541 | |
| | | | | | | 23,552,410 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Multi-Utilities – 0.7% | |
| | |
A2A SpA | | | 29,479 | | | $ | 55,183 | |
| | |
ACEA SpA | | | 1,552 | | | | 18,652 | |
| | |
AGL Energy Ltd. | | | 12,344 | | | | 84,018 | |
| | |
Algonquin Power & Utilities Corp.(a) | | | 11,661 | | | | 58,630 | |
| | |
Atco Ltd., Class I | | | 1,968 | | | | 50,396 | |
| | |
Canadian Utilities Ltd., Class A | | | 1,628 | | | | 34,407 | |
| | |
Centrica plc | | | 126,555 | | | | 241,563 | |
| | |
E.ON SE | | | 48,633 | | | | 576,765 | |
| | |
Engie SA | | | 38,454 | | | | 609,851 | |
| | |
Hera SpA | | | 19,272 | | | | 54,063 | |
| | |
Iren SpA | | | 210,717 | | | | 420,733 | |
| | |
National Grid plc | | | 53,469 | | | | 634,935 | |
| | |
REN – Redes Energeticas Nacionais SGPS SA | | | 17,917 | | | | 46,588 | |
| | |
Sembcorp Industries Ltd. | | | 16,300 | | | | 54,609 | |
| | |
Telecom Plus plc | | | 4,728 | | | | 88,582 | |
| | |
Veolia Environnement SA | | | 12,675 | | | | 346,057 | |
| | | | | | | 3,375,032 | |
|
Office REITs – 0.3% | |
| | |
Allied Properties REIT, REIT(a) | | | 22,464 | | | | 256,477 | |
| | |
Centuria Office REIT, REIT(a) | | | 187,161 | | | | 129,759 | |
| | |
Champion REIT, REIT | | | 108,000 | | | | 34,092 | |
| | |
CLS Holdings plc, REIT | | | 14,403 | | | | 15,153 | |
| | |
Covivio SA, REIT | | | 760 | | | | 32,454 | |
| | |
Cromwell Property Group, REIT(a) | | | 581,100 | | | | 117,736 | |
| | |
Derwent London plc, REIT | | | 2,870 | | | | 63,488 | |
| | |
Dexus, REIT | | | 14,476 | | | | 59,392 | |
| | |
Gecina SA, REIT | | | 440 | | | | 43,066 | |
| | |
Global One Real Estate Investment Corp., REIT | | | 48 | | | | 36,386 | |
| | |
Great Portland Estates plc, REIT | | | 12,800 | | | | 60,575 | |
| | |
Ichigo Office REIT Investment Corp., REIT | | | 41 | | | | 22,985 | |
| | |
Japan Excellent, Inc., REIT(a) | | | 41 | | | | 35,898 | |
| | |
Japan Prime Realty Investment Corp., REIT | | | 13 | | | | 30,387 | |
| | |
Japan Real Estate Investment Corp., REIT | | | 24 | | | | 88,904 | |
| | |
KDX Realty Investment Corp., REIT(a) | | | 143 | | | | 148,833 | |
See Accompanying Notes to the Financial Statements.
| | | | |
206 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Office REITs – (continued) | |
| | |
Keppel REIT, REIT | | | 73,833 | | | $ | 42,843 | |
| | |
Mirai Corp., REIT(a) | | | 88 | | | | 26,526 | |
| | |
Mori Hills REIT Investment Corp., REIT | | | 16 | | | | 14,949 | |
| | |
Nippon Building Fund, Inc., REIT(a) | | | 24 | | | | 96,193 | |
| | |
One REIT, Inc., REIT | | | 14 | | | | 24,202 | |
| | |
Orix JREIT, Inc., REIT | | | 49 | | | | 56,233 | |
| | |
Precinct Properties Group, REIT(a) | | | 103,566 | | | | 66,865 | |
| | |
Workspace Group plc, REIT | | | 8,954 | | | | 52,392 | |
| | | | | | | 1,555,788 | |
|
Oil, Gas & Consumable Fuels – 7.2% | |
| | |
Advantage Energy Ltd.* | | | 59,046 | | | | 428,304 | |
| | |
Africa Oil Corp. | | | 140,972 | | | | 259,959 | |
| | |
Aker BP ASA | | | 6,011 | | | | 172,770 | |
| | |
Ampol Ltd. | | | 5,226 | | | | 105,420 | |
| | |
ARC Resources Ltd. | | | 14,313 | | | | 230,018 | |
| | |
Athabasca Oil Corp.* | | | 204,633 | | | | 607,303 | |
| | |
Baytex Energy Corp. | | | 232,323 | | | | 1,004,097 | |
| | |
Beach Energy Ltd. | | | 39,336 | | | | 38,479 | |
| | |
Birchcliff Energy Ltd.(a) | | | 88,842 | | | | 490,207 | |
| | |
Bluenord ASA* | | | 8,424 | | | | 447,151 | |
| | |
Boss Energy Ltd.* | | | 21,197 | | | | 57,978 | |
| | |
BP plc | | | 361,686 | | | | 2,205,851 | |
| | |
BRIGHTOIL* ‡ | | | 50,147 | | | | — | |
| | |
BW Energy Ltd.* | | | 31,818 | | | | 79,462 | |
| | |
BW LPG Ltd.(b) | | | 25,545 | | | | 361,280 | |
| | |
Cameco Corp.(a) | | | 6,435 | | | | 262,962 | |
| | |
Canadian Natural Resources Ltd. | | | 23,166 | | | | 1,469,475 | |
| | |
Cardinal Energy Ltd.(a) | | | 39,585 | | | | 211,576 | |
| | |
Cenovus Energy, Inc.(a) | | | 28,275 | | | | 538,106 | |
| | |
Cool Co. Ltd. | | | 7,917 | | | | 103,111 | |
| | |
Cosmo Energy Holdings Co. Ltd.(a) | | | 1,600 | | | | 58,107 | |
| | |
Crescent Point Energy Corp. | | | 12,163 | | | | 97,427 | |
| | |
CropEnergies AG | | | 9,640 | | | | 82,739 | |
| | |
Denison Mines Corp.* | | | 53,196 | | | | 85,068 | |
| | |
Diversified Energy Co. plc(a) (b) | | | 326,079 | | | | 264,512 | |
| | |
DNO ASA | | | 290,667 | | | | 295,826 | |
| | |
Enbridge, Inc. | | | 31,551 | | | | 1,009,996 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
ENEOS Holdings, Inc. | | | 66,300 | | | $ | 244,151 | |
| | |
Energean plc | | | 4,182 | | | | 43,236 | |
| | |
Energy Fuels, Inc.* (a) | | | 10,296 | | | | 82,249 | |
| | |
Enerplus Corp. | | | 5,535 | | | | 93,496 | |
| | |
Eni SpA | | | 51,519 | | | | 840,141 | |
| | |
Equinor ASA | | | 20,982 | | | | 703,269 | |
| | |
Equital Ltd.* (a) | | | 6,201 | | | | 134,717 | |
| | |
Etablissements Maurel et Prom SA | | | 20,428 | | | | 121,241 | |
| | |
Euronav NV | | | 2,829 | | | | 50,505 | |
| | |
FLEX LNG Ltd. | | | 1,176 | | | | 36,001 | |
| | |
Freehold Royalties Ltd.(a) | | | 5,060 | | | | 52,049 | |
| | |
Frontera Energy Corp.* | | | 17,667 | | | | 149,659 | |
| | |
Galp Energia SGPS SA | | | 11,154 | | | | 167,533 | |
| | |
Gaztransport Et Technigaz SA | | | 410 | | | | 52,308 | |
| | |
Gibson Energy, Inc. | | | 7,137 | | | | 108,321 | |
| | |
Hafnia Ltd. | | | 7,872 | | | | 51,650 | |
| | |
Harbour Energy plc | | | 13,992 | | | | 43,092 | |
| | |
Headwater Exploration, Inc.(a) | | | 78,195 | | | | 420,194 | |
| | |
Idemitsu Kosan Co. Ltd. | | | 5,882 | | | | 132,791 | |
| | |
Imperial Oil Ltd.(a) | | | 4,134 | | | | 235,339 | |
| | |
Inpex Corp. | | | 21,500 | | | | 309,840 | |
| | |
International Petroleum Corp.* (a) | | | 28,977 | | | | 302,450 | |
| | |
Itochu Enex Co. Ltd.(a) | | | 19,600 | | | | 191,542 | |
| | |
Iwatani Corp. | | | 1,397 | | | | 66,306 | |
| | |
Japan Petroleum Exploration Co. Ltd.(a) | | | 1,700 | | | | 57,810 | |
| | |
Karoon Energy Ltd.* | | | 188,916 | | | | 301,423 | |
| | |
Keyera Corp. | | | 3,108 | | | | 72,201 | |
| | |
Koninklijke Vopak NV | | | 1,558 | | | | 52,385 | |
| | |
MEG Energy Corp.* | | | 4,928 | | | | 97,264 | |
| | |
Naphtha Israel Petroleum Corp. Ltd.(a) | | | 10,742 | | | | 41,183 | |
| | |
Neste OYJ(a) | | | 6,045 | | | | 202,613 | |
| | |
New Hope Corp. Ltd. | | | 17,010 | | | | 62,142 | |
| | |
NexGen Energy Ltd.* | | | 21,987 | | | | 132,563 | |
| | |
NuVista Energy Ltd.* | | | 57,798 | | | | 559,973 | |
| | |
Oil Refineries Ltd. | | | 814,086 | | | | 222,963 | |
| | |
Okeanis Eco Tankers Corp.(b) | | | 4,680 | | | | 134,681 | |
| | |
OMV AG(a) | | | 2,691 | | | | 117,644 | |
| | |
ORLEN SA | | | 11,503 | | | | 181,526 | |
| | |
Paladin Energy Ltd.* (a) | | | 151,044 | | | | 90,374 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 207 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Paramount Resources Ltd., Class A | | | 2,772 | | | $ | 66,552 | |
| | |
Parex Resources, Inc. | | | 36,075 | | | | 690,707 | |
| | |
Parkland Corp. | | | 3,878 | | | | 117,241 | |
| | |
Paz Oil Co. Ltd.* (a) | | | 575 | | | | 40,815 | |
| | |
Pembina Pipeline Corp. | | | 7,956 | | | | 244,597 | |
| | |
Peyto Exploration & Development Corp.(a) | | | 59,787 | | | | 628,770 | |
| | |
PrairieSky Royalty Ltd. | | | 3,977 | | | | 69,757 | |
| | |
Repsol SA | | | 26,871 | | | | 392,667 | |
| | |
San-Ai Obbli Co. Ltd.(a) | | | 19,500 | | | | 208,076 | |
| | |
Santos Ltd. | | | 66,105 | | | | 321,023 | |
| | |
Saras SpA(a) | | | 151,281 | | | | 219,468 | |
| | |
Serica Energy plc | | | 96,486 | | | | 272,564 | |
| | |
Shell plc | | | 140,088 | | | | 4,498,780 | |
| | |
Spartan Delta Corp.(a) | | | 8,979 | | | | 28,847 | |
| | |
Strike Energy Ltd.* (a) | | | 129,355 | | | | 31,941 | |
| | |
Suncor Energy, Inc. | | | 27,690 | | | | 895,774 | |
| | |
Tamarack Valley Energy Ltd.(a) | | | 183,963 | | | | 555,235 | |
| | |
TC Energy Corp.(a) | | | 15,054 | | | | 517,903 | |
| | |
Topaz Energy Corp. | | | 3,731 | | | | 56,976 | |
| | |
TORM plc, Class A(a) | | | 10,764 | | | | 328,041 | |
| | |
TotalEnergies SE | | | 48,594 | | | | 3,246,196 | |
| | |
Tourmaline Oil Corp. | | | 6,334 | | | | 334,574 | |
| | |
United Energy Group Ltd.(a) | | | 358,000 | | | | 57,191 | |
| | |
Var Energi ASA | | | 7,339 | | | | 24,720 | |
| | |
VERBIO Vereinigte BioEnergie AG | | | 1,107 | | | | 37,291 | |
| | |
Vermilion Energy, Inc.(a) | | | 54,951 | | | | 792,054 | |
| | |
Viva Energy Group Ltd.(b) | | | 17,630 | | | | 31,590 | |
| | |
Whitecap Resources, Inc. | | | 12,245 | | | | 94,467 | |
| | |
Whitehaven Coal Ltd.(a) | | | 16,702 | | | | 78,254 | |
| | |
Woodside Energy Group Ltd. | | | 39,859 | | | | 864,608 | |
| | | | | | | 33,672,688 | |
|
Paper & Forest Products – 0.5% | |
| | |
Altri SGPS SA | | | 21,115 | | | | 101,951 | |
| | |
Canfor Corp.* | | | 20,241 | | | | 206,748 | |
| | |
Daio Paper Corp. | | | 3,745 | | | | 30,564 | |
| | |
Ence Energia y Celulosa SA | | | 11,726 | | | | 34,977 | |
| | |
Hokuetsu Corp.(a) | | | 54,600 | | | | 415,327 | |
| | |
Holmen AB, Class B | | | 1,540 | | | | 57,988 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Paper & Forest Products – (continued) | |
| | |
Interfor Corp.* | | | 2,378 | | | $ | 29,308 | |
| | |
Mondi plc | | | 11,778 | | | | 189,941 | |
| | |
Navigator Co. SA (The) | | | 5,269 | | | | 20,941 | |
| | |
Nippon Paper Industries Co. Ltd.* | | | 39,000 | | | | 336,835 | |
| | |
Oji Holdings Corp.(a) | | | 23,400 | | | | 99,413 | |
| | |
Semapa-Sociedade de Investimento e Gestao | | | 4,873 | | | | 68,814 | |
| | |
Stella-Jones, Inc.(a) | | | 2,574 | | | | 134,684 | |
| | |
Stora Enso OYJ, Class A(a) | | | 2,501 | | | | 30,533 | |
| | |
Stora Enso OYJ, Class R | | | 9,711 | | | | 116,246 | |
| | |
Svenska Cellulosa AB SCA, Class A | | | 2,068 | | | | 28,208 | |
| | |
Svenska Cellulosa AB SCA, Class B(a) | | | 6,314 | | | | 86,437 | |
| | |
UPM-Kymmene OYJ(a) | | | 7,956 | | | | 267,170 | |
| | |
West Fraser Timber Co. Ltd.(a) | | | 1,271 | | | | 85,685 | |
| | | | | | | 2,341,770 | |
|
Passenger Airlines – 0.2% | |
| | |
Air Canada* | | | 5,192 | | | | 62,570 | |
| | |
Air France-KLM* | | | 3,677 | | | | 41,408 | |
| | |
Air New Zealand Ltd.(a) | | | 11,968 | | | | 4,664 | |
| | |
ANA Holdings, Inc.* | | | 2,400 | | | | 46,781 | |
| | |
Deutsche Lufthansa AG (Registered)* | | | 11,462 | | | | 80,010 | |
| | |
easyJet plc* | | | 6,806 | | | | 30,227 | |
| | |
Exchange Income Corp. | | | 2,255 | | | | 69,278 | |
| | |
Finnair OYJ* (a) | | | 82,324 | | | | 5,012 | |
| | |
Japan Airlines Co. Ltd. | | | 2,800 | | | | 51,102 | |
| | |
JET2 plc | | | 4,018 | | | | 48,854 | |
| | |
Norwegian Air Shuttle ASA* | | | 158,886 | | | | 113,977 | |
| | |
Qantas Airways Ltd.* | | | 22,968 | | | | 71,402 | |
| | |
Singapore Airlines Ltd. | | | 16,799 | | | | 74,918 | |
| | |
Wizz Air Holdings plc* (b) | | | 1,394 | | | | 26,160 | |
| | | | | | | 726,363 | |
|
Personal Care Products – 1.0% | |
| | |
Beiersdorf AG | | | 1,560 | | | | 204,548 | |
| | |
Best World International Ltd.* | | | 57,400 | | | | 70,805 | |
| | |
euglena Co. Ltd.* (a) | | | 4,400 | | | | 21,180 | |
| | |
Fancl Corp. | | | 400 | | | | 5,955 | |
| | |
Haleon plc | | | 72,774 | | | | 290,974 | |
See Accompanying Notes to the Financial Statements.
| | | | |
208 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Personal Care Products – (continued) | |
| | |
Interparfums SA | | | 159 | | | $ | 7,487 | |
| | |
Jamieson Wellness, Inc.(b) | | | 2,330 | | | | 38,217 | |
| | |
Kao Corp. | | | 7,300 | | | | 264,824 | |
| | |
Kobayashi Pharmaceutical Co. Ltd. | | | 900 | | | | 36,964 | |
| | |
Kose Corp. | | | 700 | | | | 45,792 | |
| | |
L’Occitane International SA | | | 4,500 | | | | 11,560 | |
| | |
L’Oreal SA | | | 3,471 | | | | 1,453,414 | |
| | |
Mandom Corp. | | | 4,100 | | | | 37,414 | |
| | |
Milbon Co. Ltd. | | | 1,000 | | | | 26,260 | |
| | |
Noevir Holdings Co. Ltd.(a) | | | 1,000 | | | | 34,864 | |
| | |
Pola Orbis Holdings, Inc. | | | 2,000 | | | | 19,994 | |
| | |
PZ Cussons plc | | | 17,220 | | | | 27,958 | |
| | |
Rohto Pharmaceutical Co. Ltd. | | | 4,000 | | | | 92,231 | |
| | |
Shiseido Co. Ltd. | | | 6,200 | | | | 194,951 | |
| | |
Unilever plc | | | 37,011 | | | | 1,746,558 | |
| | | | | | | 4,631,950 | |
|
Pharmaceuticals – 4.9% | |
| | |
ALK-Abello A/S, Class B* | | | 7,913 | | | | 87,575 | |
| | |
Almirall SA | | | 4,564 | | | | 41,439 | |
| | |
Astellas Pharma, Inc. | | | 27,300 | | | | 342,501 | |
| | |
AstraZeneca plc | | | 23,166 | | | | 2,881,355 | |
| | |
Bausch Health Cos., Inc.* (a) | | | 97,851 | | | | 665,380 | |
| | |
Bayer AG (Registered) | | | 20,748 | | | | 891,700 | |
| | |
Camurus AB* | | | 1,435 | | | | 42,950 | |
| | |
Chugai Pharmaceutical Co. Ltd. | | | 8,900 | | | | 262,102 | |
| | |
COSMO Pharmaceuticals NV | | | 741 | | | | 28,132 | |
| | |
Daiichi Sankyo Co. Ltd. | | | 28,400 | | | | 723,479 | |
| | |
Dechra Pharmaceuticals plc | | | 2,142 | | | | 98,978 | |
| | |
Eisai Co. Ltd. | | | 4,300 | | | | 226,038 | |
| | |
Euroapi SA* | | | 3,444 | | | | 18,001 | |
| | |
Faes Farma SA | | | 17,897 | | | | 56,089 | |
| | |
Financiere de Tubize SA | | | 510 | | | | 34,932 | |
| | |
GSK plc | | | 60,879 | | | | 1,076,634 | |
| | |
H Lundbeck A/S, Class A | | | 5,650 | | | | 25,540 | |
| | |
Haw Par Corp. Ltd. | | | 8,200 | | | | 57,218 | |
| | |
Hikma Pharmaceuticals plc | | | 2,800 | | | | 64,607 | |
| | |
Hutchmed China Ltd.* (a) | | | 27,388 | | | | 106,016 | |
| | |
Indivior plc* | | | 7,254 | | | | 138,637 | |
| | |
Ipsen SA | | | 751 | | | | 88,509 | |
| | |
JCR Pharmaceuticals Co. Ltd. | | | 2,400 | | | | 18,129 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Pharmaceuticals – (continued) | |
| | |
Kaken Pharmaceutical Co. Ltd. | | | 1,500 | | | $ | 33,012 | |
| | |
Kissei Pharmaceutical Co. Ltd. | | | 1,400 | | | | 29,351 | |
| | |
Kyowa Kirin Co. Ltd. | | | 4,300 | | | | 66,951 | |
| | |
Laboratorios Farmaceuticos Rovi SA | | | 1,435 | | | | 76,522 | |
| | |
Merck KGaA | | | 1,989 | | | | 299,273 | |
| | |
Mochida Pharmaceutical Co. Ltd. | | | 900 | | | | 19,671 | |
| | |
Nippon Shinyaku Co. Ltd. | | | 1,400 | | | | 56,335 | |
| | |
Novartis AG (Registered) | | | 30,888 | | | | 2,869,371 | |
| | |
Novo Nordisk A/S, Class B | | | 48,282 | | | | 4,628,989 | |
| | |
Ono Pharmaceutical Co. Ltd. | | | 7,800 | | | | 133,987 | |
| | |
Orion OYJ, Class A | | | 352 | | | | 13,952 | |
| | |
Orion OYJ, Class B | | | 1,855 | | | | 73,606 | |
| | |
Otsuka Holdings Co. Ltd. | | | 7,900 | | | | 263,429 | |
| | |
Recordati Industria Chimica e Farmaceutica SpA | | | 1,628 | | | | 75,027 | |
| | |
Roche Holding AG | | | 429 | | | | 116,531 | |
| | |
Roche Holding AG—BR | | | 10,530 | | | | 2,705,830 | |
| | |
Sanofi SA | | | 16,692 | | | | 1,512,043 | |
| | |
Santen Pharmaceutical Co. Ltd. | | | 4,500 | | | | 38,851 | |
| | |
Sawai Group Holdings Co. Ltd. | | | 15,600 | | | | 495,055 | |
| | |
Shionogi & Co. Ltd. | | | 4,200 | | | | 193,769 | |
| | |
Sumitomo Pharma Co. Ltd.(a) | | | 3,600 | | | | 10,935 | |
| | |
Taisho Pharmaceutical Holdings Co. Ltd. | | | 600 | | | | 23,617 | |
| | |
Takeda Pharmaceutical Co. Ltd. | | | 23,400 | | | | 627,780 | |
| | |
Teva Pharmaceutical Industries Ltd.* | | | 23,868 | | | | 201,833 | |
| | |
Torii Pharmaceutical Co. Ltd. | | | 800 | | | | 19,228 | |
| | |
Towa Pharmaceutical Co. Ltd. | | | 9,200 | | | | 168,090 | |
| | |
Tsumura & Co. | | | 900 | | | | 16,028 | |
| | |
UCB SA | | | 2,067 | | | | 150,884 | |
| | |
Vetoquinol SA | | | 308 | | | | 25,947 | |
| | |
Virbac SACA(a) | | | 132 | | | | 37,811 | |
| | |
ZERIA Pharmaceutical Co. Ltd. | | | 1,800 | | | | 23,723 | |
| | | | | | | 22,983,372 | |
|
Professional Services – 1.6% | |
| | |
Adecco Group AG (Registered) | | | 3,549 | | | | 133,529 | |
| | |
AFRY AB | | | 2,640 | | | | 27,646 | |
| | |
ALS Ltd. | | | 8,712 | | | | 59,187 | |
| | |
APM Human Services International Ltd.(a) | | | 211,185 | | | | 279,458 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 209 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Professional Services – (continued) | |
| | |
Applus Services SA | | | 44,577 | | | $ | 468,823 | |
| | |
Arcadis NV | | | 1,189 | | | | 50,170 | |
| | |
BayCurrent Consulting, Inc. | | | 1,400 | | | | 34,749 | |
| | |
Bell System24 Holdings, Inc.(a) | | | 12,900 | | | | 131,602 | |
| | |
Benefit One, Inc. | | | 1,000 | | | | 7,085 | |
| | |
Bureau Veritas SA | | | 4,797 | | | | 108,964 | |
| | |
Computershare Ltd. | | | 8,463 | | | | 132,833 | |
| | |
Danel Adir Yeoshua Ltd.(a) | | | 533 | | | | 38,194 | |
| | |
dip Corp. | | | 1,400 | | | | 27,456 | |
| | |
DKSH Holding AG | | | 660 | | | | 40,396 | |
| | |
en Japan, Inc. | | | 2,000 | | | | 29,450 | |
| | |
Experian plc | | | 14,157 | | | | 427,924 | |
| | |
Funai Soken Holdings, Inc. | | | 2,700 | | | | 43,911 | |
| | |
GlobalData plc | | | 17,900 | | | | 32,581 | |
| | |
Hays plc | | | 567,918 | | | | 662,264 | |
| | |
Hilan Ltd. | | | 1,025 | | | | 43,984 | |
| | |
Infomart Corp. | | | 17,600 | | | | 41,488 | |
| | |
Insource Co. Ltd. | | | 3,800 | | | | 22,081 | |
| | |
Intertek Group plc | | | 2,106 | | | | 97,698 | |
| | |
IPH Ltd. | | | 14,227 | | | | 61,433 | |
| | |
JAC Recruitment Co. Ltd. | | | 1,300 | | | | 20,481 | |
| | |
Learning Technologies Group plc | | | 32,868 | | | | 24,668 | |
| | |
Link Administration Holdings Ltd.(a) | | | 180,570 | | | | 136,050 | |
| | |
McMillan Shakespeare Ltd. | | | 3,198 | | | | 33,936 | |
| | |
MEITEC Group Holdings, Inc. | | | 2,400 | | | | 41,821 | |
| | |
Nihon M&A Center Holdings, Inc. | | | 4,800 | | | | 21,727 | |
| | |
Nomura Co. Ltd. | | | 6,000 | | | | 34,191 | |
| | |
Open Up Group, Inc.(a) | | | 4,400 | | | | 53,865 | |
| | |
Outsourcing, Inc.(a) | | | 35,100 | | | | 256,566 | |
| | |
Pagegroup plc | | | 21,372 | | | | 97,408 | |
| | |
Persol Holdings Co. Ltd. | | | 42,000 | | | | 62,205 | |
| | |
Randstad NV | | | 2,301 | | | | 118,787 | |
| | |
Recruit Holdings Co. Ltd. | | | 26,100 | | | | 746,748 | |
| | |
RELX plc | | | 28,860 | | | | 1,004,378 | |
| | |
RWS Holdings plc(a) | | | 105,144 | | | | 264,871 | |
| | |
SGS SA (Registered) | | | 3,315 | | | | 269,484 | |
| | |
SmartGroup Corp. Ltd.(a) | | | 7,766 | | | | 42,188 | |
| | |
SMS Co. Ltd. | | | 2,000 | | | | 31,298 | |
| | |
Synergie SE | | | 2,870 | | | | 89,946 | |
| | |
TechnoPro Holdings, Inc. | | | 1,100 | | | | 21,354 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Professional Services – (continued) | |
| | |
Teleperformance SE | | | 780 | | | $ | 89,165 | |
| | |
TELUS International CDA, Inc.* | | | 2,214 | | | | 14,162 | |
| | |
Thomson Reuters Corp.(a) | | | 2,223 | | | | 265,991 | |
| | |
Tinexta Spa | | | 1,056 | | | | 18,138 | |
| | |
Transcosmos, Inc.(a) | | | 7,800 | | | | 157,344 | |
| | |
Wolters Kluwer NV | | | 3,705 | | | | 474,250 | |
| | | | | | | 7,393,928 | |
|
Real Estate Management & Development – 2.5% | |
| | |
Aeon Mall Co. Ltd. | | | 1,990 | | | | 22,509 | |
| | |
AFI Properties Ltd.* (a) | | | 2,460 | | | | 66,341 | |
| | |
Africa Israel Residences Ltd.(a) | | | 2,120 | | | | 89,819 | |
| | |
Airport City Ltd.* | | | 1,928 | | | | 25,311 | |
| | |
Allreal Holding AG (Registered) | | | 366 | | | | 58,637 | |
| | |
Alony Hetz Properties & Investments Ltd. | | | 7,216 | | | | 35,085 | |
| | |
Altus Group Ltd. | | | 2,578 | | | | 87,465 | |
| | |
Amot Investments Ltd. | | | 5,448 | | | | 22,786 | |
| | |
Aroundtown SA* (a) | | | 317,109 | | | | 712,937 | |
| | |
Atrium Ljungberg AB, Class B | | | 792 | | | | 12,150 | |
| | |
Aura Investments Ltd.(a) | | | 44,280 | | | | 91,941 | |
| | |
Azrieli Group Ltd. | | | 532 | | | | 22,842 | |
| | |
Big Shopping Centers Ltd.* | | | 287 | | | | 20,077 | |
| | |
Blue Square Real Estate Ltd.(a) | | | 1,833 | | | | 89,712 | |
| | |
Bukit Sembawang Estates Ltd. | | | 8,200 | | | | 21,666 | |
| | |
CA Immobilien Anlagen AG | | | 572 | | | | 19,287 | |
| | |
Capitaland India Trust | | | 55,054 | | | | 38,577 | |
| | |
CapitaLand Investment Ltd. | | | 42,131 | | | | 90,409 | |
| | |
Castellum AB | | | 10,335 | | | | 98,562 | |
| | |
Catena AB | | | 924 | | | | 30,517 | |
| | |
Cibus Nordic Real Estate AB publ | | | 21,762 | | | | 203,642 | |
| | |
City Developments Ltd. | | | 9,400 | | | | 43,362 | |
| | |
Citycon OYJ | | | 7,298 | | | | 38,524 | |
| | |
CK Asset Holdings Ltd. | | | 39,000 | | | | 194,885 | |
| | |
Colliers International Group, Inc.(a) | | | 748 | | | | 67,734 | |
| | |
Corem Property Group AB, Class B(a) | | | 184,002 | | | | 118,412 | |
| | |
Daito Trust Construction Co. Ltd. | | | 1,500 | | | | 159,959 | |
| | |
Daiwa House Industry Co. Ltd. | | | 14,700 | | | | 400,587 | |
| | |
Deutsche EuroShop AG | | | 4,592 | | | | 83,193 | |
| | |
Deutsche Wohnen SE | | | 1,012 | | | | 21,715 | |
See Accompanying Notes to the Financial Statements.
| | | | |
210 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Real Estate Management & Development – (continued) | |
| | |
Dios Fastigheter AB | | | 7,480 | | | $ | 40,404 | |
| | |
Electra Real Estate Ltd.(a) | | | 1,476 | | | | 11,876 | |
| | |
Entra ASA(b) | | | 2,068 | | | | 16,132 | |
| | |
ESR Group Ltd.(b) | | | 32,800 | | | | 42,087 | |
| | |
Fabege AB(a) | | | 5,412 | | | | 40,234 | |
| | |
Fastighets AB Balder, Class B* (a) | | | 12,348 | | | | 52,154 | |
| | |
FastPartner AB, Class A | | | 3,124 | | | | 10,849 | |
| | |
FirstService Corp. | | | 676 | | | | 95,553 | |
| | |
G City Ltd.(a) | | | 28,290 | | | | 68,285 | |
| | |
Gav-Yam Lands Corp. Ltd. | | | 593 | | | | 3,349 | |
| | |
Goldcrest Co. Ltd. | | | 4,100 | | | | 58,044 | |
| | |
Grainger plc | | | 39,273 | | | | 108,369 | |
| | |
Grand City Properties SA* | | | 27,417 | | | | 244,444 | |
| | |
Great Eagle Holdings Ltd.(a) | | | 79,451 | | | | 129,362 | |
| | |
GuocoLand Ltd.* | | | 95,200 | | | | 104,925 | |
| | |
Hang Lung Group Ltd. | | | 273,000 | | | | 363,553 | |
| | |
Hang Lung Properties Ltd. | | | 44,000 | | | | 58,032 | |
| | |
Heiwa Real Estate Co. Ltd.(a) | | | 1,300 | | | | 33,005 | |
| | |
Henderson Land Development Co. Ltd. | | | 33,239 | | | | 86,660 | |
| | |
Ho Bee Land Ltd. | | | 75,000 | | | | 99,084 | |
| | |
Hufvudstaden AB, Class A | | | 2,610 | | | | 27,752 | |
| | |
Hulic Co. Ltd. | | | 11,700 | | | | 106,381 | |
| | |
Ichigo, Inc. | | | 17,800 | | | | 38,551 | |
| | |
IES Holdings Ltd.* | | | 943 | | | | 45,500 | |
| | |
IMMOFINANZ AG* | | | 2,132 | | | | 42,817 | |
| | |
Intershop Holding AG | | | 76 | | | | 50,358 | |
| | |
Israel Canada T.R Ltd.(a) | | | 44,720 | | | | 93,960 | |
| | |
Isras Investment Co. Ltd. | | | 533 | | | | 90,064 | |
| | |
IWG plc* | | | 41,041 | | | | 65,738 | |
| | |
Jeudan A/S | | | 3,237 | | | | 104,976 | |
| | |
K Wah International Holdings Ltd. | | | 390,000 | | | | 104,670 | |
| | |
Katitas Co. Ltd. | | | 1,100 | | | | 14,578 | |
| | |
Keihanshin Building Co. Ltd. | | | 4,100 | | | | 37,333 | |
| | |
Kerry Properties Ltd. | | | 16,500 | | | | 27,751 | |
| | |
Kojamo OYJ | | | 3,579 | | | | 30,491 | |
| | |
Kowloon Development Co. Ltd. | | | 117,000 | | | | 103,175 | |
| | |
LEG Immobilien SE* | | | 1,120 | | | | 69,657 | |
| | |
Lendlease Corp. Ltd.(a) | | | 14,582 | | | | 57,334 | |
| | |
Lifestyle Communities Ltd.(a) | | | 6,920 | | | | 68,218 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Real Estate Management & Development – (continued) | |
| | |
Mega Or Holdings Ltd., REIT(a) | | | 2,542 | | | $ | 34,773 | |
| | |
Melisron Ltd. | | | 460 | | | | 24,890 | |
| | |
Mitsubishi Estate Co. Ltd. | | | 19,500 | | | | 246,446 | |
| | |
Mitsui Fudosan Co. Ltd. | | | 15,600 | | | | 334,466 | |
| | |
Mivne Real Estate KD Ltd. | | | 14,248 | | | | 30,715 | |
| | |
Mobimo Holding AG (Registered) | | | 352 | | | | 97,085 | |
| | |
Morguard Corp. | | | 1,025 | | | | 74,949 | |
| | |
New World Development Co. Ltd.(a) | | | 33,590 | | | | 61,560 | |
| | |
Nexity SA(a) | | | 14,898 | | | | 207,548 | |
| | |
Nomura Real Estate Holdings, Inc. | | | 1,400 | | | | 32,401 | |
| | |
NP3 Fastigheter AB | | | 1,462 | | | | 19,484 | |
| | |
Nyfosa AB(a) | | | 48,945 | | | | 235,686 | |
| | |
OUE Ltd. | | | 140,400 | | | | 105,552 | |
| | |
Pandox AB, Class B | | | 5,412 | | | | 53,090 | |
| | |
PEXA Group Ltd.* | | | 7,380 | | | | 50,792 | |
| | |
Platzer Fastigheter Holding AB, Class B | | | 3,080 | | | | 16,127 | |
| | |
Prashkovsky Investments and Construction Ltd.(a) | | | 3,040 | | | | 55,276 | |
| | |
PSP Swiss Property AG (Registered) | | | 736 | | | | 90,337 | |
| | |
Relo Group, Inc. | | | 2,270 | | | | 22,289 | |
| | |
Sagax AB, Class B(a) | | | 2,420 | | | | 43,645 | |
| | |
Samhallsbyggnadsbolaget i Norden AB(a) | | | 22,748 | | | | 6,588 | |
| | |
SAMTY Co. Ltd.(a) | | | 15,600 | | | | 255,047 | |
| | |
Savills plc(a) | | | 48,867 | | | | 466,969 | |
| | |
Sino Land Co. Ltd. | | | 73,785 | | | | 73,647 | |
| | |
Sirius Real Estate Ltd. | | | 58,680 | | | | 56,822 | |
| | |
Starts Corp., Inc.(a) | | | 11,700 | | | | 219,947 | |
| | |
StorageVault Canada, Inc. | | | 12,833 | | | | 39,749 | |
| | |
Sumitomo Realty & Development Co. Ltd.(a) | | | 10,800 | | | | 267,709 | |
| | |
Summit Real Estate Holdings Ltd.* | | | 2,706 | | | | 25,832 | |
| | |
Sun Frontier Fudousan Co. Ltd.(a) | | | 11,700 | | | | 112,484 | |
| | |
Sun Hung Kai Properties Ltd. | | | 33,500 | | | | 344,008 | |
| | |
Swire Pacific Ltd., Class A | | | 10,500 | | | | 67,230 | |
| | |
Swire Properties Ltd. | | | 16,400 | | | | 31,733 | |
| | |
Swiss Prime Site AG (Registered) | | | 1,197 | | | | 111,012 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 211 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Real Estate Management & Development – (continued) | |
| | |
TAG Immobilien AG* | | | 59,709 | | | $ | 649,111 | |
| | |
Tokyo Tatemono Co. Ltd. | | | 5,200 | | | | 68,294 | |
| | |
Tokyu Fudosan Holdings Corp. | | | 11,200 | | | | 64,473 | |
| | |
Tosei Corp.(a) | | | 8,000 | | | | 93,605 | |
| | |
Tricon Residential, Inc.(a) | | | 16,263 | | | | 107,659 | |
| | |
UOL Group Ltd. | | | 6,799 | | | | 29,279 | |
| | |
VGP NV | | | 738 | | | | 59,870 | |
| | |
Villar International Ltd. | | | 1,599 | | | | 59,999 | |
| | |
Vonovia SE | | | 17,004 | | | | 390,019 | |
| | |
Wallenstam AB, Class B(a) | | | 8,888 | | | | 29,943 | |
| | |
Wharf Holdings Ltd. (The) | | | 17,000 | | | | 43,105 | |
| | |
Wharf Real Estate Investment Co. Ltd. | | | 25,000 | | | | 87,385 | |
| | |
Wihlborgs Fastigheter AB | | | 7,304 | | | | 47,167 | |
| | |
Wing Tai Holdings Ltd. | | | 57,400 | | | | 56,560 | |
| | |
Yanlord Land Group Ltd.* | | | 192,000 | | | | 79,180 | |
| | |
YH Dimri Construction & Development Ltd.(a) | | | 452 | | | | 24,256 | |
| | | | | | | 11,640,141 | |
|
Residential REITs – 0.1% | |
| | |
Advance Residence Investment Corp., REIT(a) | | | 18 | | | | 39,044 | |
| | |
Altarea SCA, REIT | | | 92 | | | | 6,535 | |
| | |
Boardwalk REIT, REIT(a) | | | 1,000 | | | | 46,649 | |
| | |
Canadian Apartment Properties REIT, REIT(a) | | | 1,012 | | | | 29,757 | |
| | |
Comforia Residential REIT, Inc., REIT | | | 19 | | | | 40,272 | |
| | |
Daiwa Securities Living Investments Corp., REIT | | | 26 | | | | 19,194 | |
| | |
Ingenia Communities Group, REIT | | | 20,254 | | | | 50,013 | |
| | |
InterRent REIT, REIT | | | 4,600 | | | | 38,967 | |
| | |
Killam Apartment REIT, REIT | | | 2,624 | | | | 29,618 | |
| | |
Nippon Accommodations Fund, Inc., REIT | | | 8 | | | | 32,170 | |
| | |
UNITE Group plc (The), REIT | | | 8,364 | | | | 88,146 | |
| | |
Xior Student Housing NV, REIT(b) | | | 1,581 | | | | 45,371 | |
| | | | | | | 465,736 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Retail REITs – 0.7% | |
| | |
AEON REIT Investment Corp., REIT | | | 29 | | | $ | 27,574 | |
| | |
BWP Trust, REIT | | | 32,513 | | | | 66,903 | |
| | |
CapitaLand China Trust, REIT | | | 44,000 | | | | 25,371 | |
| | |
CapitaLand Integrated Commercial Trust, REIT | | | 75,746 | | | | 97,305 | |
| | |
Carmila SA, REIT* (a) | | | 20,748 | | | | 289,923 | |
| | |
Charter Hall Retail REIT, REIT | | | 35,342 | | | | 68,249 | |
| | |
Choice Properties REIT, REIT | | | 3,957 | | | | 34,318 | |
| | |
Crombie REIT, REIT(a) | | | 3,256 | | | | 28,567 | |
| | |
Eurocommercial Properties NV, REIT | | | 15,249 | | | | 326,232 | |
| | |
First Capital REIT, REIT | | | 5,822 | | | | 54,687 | |
| | |
Fortune REIT, REIT | | | 41,000 | | | | 22,951 | |
| | |
Frasers Centrepoint Trust, REIT | | | 12,749 | | | | 19,262 | |
| | |
Fukuoka REIT Corp., REIT | | | 82 | | | | 88,148 | |
| | |
Hammerson plc, REIT(a) | | | 237,021 | | | | 63,390 | |
| | |
HMC Capital Ltd., REIT(a) | | | 9,954 | | | | 26,785 | |
| | |
HomeCo Daily Needs REIT, REIT(a) (b) | | | 636,012 | | | | 430,879 | |
| | |
Japan Metropolitan Fund Invest, REIT | | | 103 | | | | 66,311 | |
| | |
Kiwi Property Group Ltd., REIT | | | 37,660 | | | | 16,976 | |
| | |
Klepierre SA, REIT | | | 3,861 | | | | 93,457 | |
| | |
Lendlease Global Commercial REIT, REIT | | | 143,500 | | | | 53,418 | |
| | |
Link REIT, REIT | | | 38,323 | | | | 175,829 | |
| | |
Mapletree Pan Asia Commercial Trust, REIT | | | 30,462 | | | | 29,572 | |
| | |
Mercialys SA, REIT(a) | | | 31,200 | | | | 265,146 | |
| | |
Primaris REIT, REIT(a) | | | 2,706 | | | | 24,229 | |
| | |
Region RE Ltd., REIT(a) | | | 19,923 | | | | 24,787 | |
| | |
Retail Estates NV, REIT | | | 3,978 | | | | 241,773 | |
| | |
Scentre Group, REIT | | | 82,290 | | | | 126,608 | |
| | |
Shaftesbury Capital plc, REIT | | | 109,824 | | | | 138,597 | |
| | |
SmartCentres REIT, REIT(a) | | | 1,558 | | | | 24,118 | |
| | |
Starhill Global REIT, REIT | | | 80,696 | | | | 26,211 | |
| | |
Unibail-Rodamco-Westfield, REIT* | | | 2,145 | | | | 105,791 | |
| | |
Unibail-Rodamco-Westfield, REIT, CHDI* | | | 5 | | | | 12 | |
| | |
Vicinity Ltd., REIT | | | 65,692 | | | | 70,708 | |
| | |
Waypoint REIT Ltd., REIT | | | 47,560 | | | | 63,839 | |
| | | | | | | 3,217,926 | |
See Accompanying Notes to the Financial Statements.
| | | | |
212 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – 2.1% | |
| | |
Advantest Corp. | | | 12,100 | | | $ | 304,807 | |
| | |
AEM Holdings Ltd. | | | 13,200 | | | | 33,336 | |
| | |
AIXTRON SE | | | 2,337 | | | | 65,362 | |
| | |
Alphawave IP Group plc* (a) | | | 19,492 | | | | 23,179 | |
| | |
ams-OSRAM AG* (a) | | | 87,360 | | | | 309,967 | |
| | |
ASM International NV | | | 702 | | | | 288,272 | |
| | |
ASML Holding NV | | | 6,084 | | | | 3,635,324 | |
| | |
ASMPT Ltd. | | | 5,000 | | | | 42,175 | |
| | |
BE Semiconductor Industries NV | | | 1,400 | | | | 143,985 | |
| | |
Camtek Ltd.* | | | 1,025 | | | | 53,080 | |
| | |
Disco Corp. | | | 1,200 | | | | 207,244 | |
| | |
Elmos Semiconductor SE | | | 410 | | | | 26,739 | |
| | |
Ferrotec Holdings Corp.(a) | | | 15,600 | | | | 269,365 | |
| | |
Furuya Metal Co. Ltd. | | | 1,000 | | | | 63,786 | |
| | |
Infineon Technologies AG | | | 19,149 | | | | 556,108 | |
| | |
Japan Material Co. Ltd. | | | 2,500 | | | | 34,583 | |
| | |
Lasertec Corp. | | | 1,300 | | | | 216,359 | |
| | |
Megachips Corp. | | | 4,900 | | | | 124,890 | |
| | |
Melexis NV | | | 495 | | | | 36,285 | |
| | |
Meyer Burger Technology AG* (a) | | | 187,149 | | | | 50,054 | |
| | |
Nordic Semiconductor ASA* | | | 3,828 | | | | 30,893 | |
| | |
Nova Ltd.* | | | 352 | | | | 33,490 | |
| | |
Optorun Co. Ltd. | | | 2,900 | | | | 33,032 | |
| | |
REC Silicon ASA* | | | 22,352 | | | | 29,021 | |
| | |
Renesas Electronics Corp.* | | | 21,900 | | | | 282,779 | |
| | |
Rohm Co. Ltd. | | | 6,300 | | | | 99,256 | |
| | |
Rorze Corp.(a) | | | 400 | | | | 29,291 | |
| | |
SCREEN Holdings Co. Ltd. | | | 2,200 | | | | 100,728 | |
| | |
Shinko Electric Industries Co. Ltd. | | | 1,400 | | | | 44,104 | |
| | |
Siltronic AG | | | 5,421 | | | | 463,557 | |
| | |
SMA Solar Technology AG* | | | 328 | | | | 20,022 | |
| | |
Socionext, Inc.(a) | | | 600 | | | | 57,130 | |
| | |
SOITEC* | | | 369 | | | | 54,800 | |
| | |
STMicroelectronics NV | | | 9,672 | | | | 367,834 | |
| | |
SUMCO Corp.(a) | | | 5,700 | | | | 72,828 | |
| | |
Tokyo Electron Ltd. | | | 7,300 | | | | 952,237 | |
| | |
Tokyo Seimitsu Co. Ltd. | | | 1,600 | | | | 73,775 | |
| | |
Tower Semiconductor Ltd.* | | | 2,139 | | | | 49,484 | |
| | |
Tri Chemical Laboratories, Inc. | | | 1,800 | | | | 37,558 | |
| | |
u-blox Holding AG* (a) | | | 2,418 | | | | 227,705 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Ulvac, Inc. | | | 1,000 | | | $ | 33,880 | |
| | |
Weebit Nano Ltd.* (a) | | | 9,758 | | | | 20,450 | |
| | |
X-Fab Silicon Foundries SE* (b) | | | 4,480 | | | | 40,440 | |
| | | | | | | 9,639,194 | |
|
Software – 1.1% | |
| | |
Altium Ltd. | | | 1,716 | | | | 42,894 | |
| | |
Appier Group, Inc.* | | | 4,100 | | | | 33,191 | |
| | |
Asseco Poland SA | | | 3,362 | | | | 61,472 | |
| | |
Atoss Software AG | | | 176 | | | | 37,020 | |
| | |
BlackBerry Ltd.* | | | 28,587 | | | | 102,755 | |
| | |
Bytes Technology Group plc | | | 15,205 | | | | 90,813 | |
| | |
Constellation Software, Inc. | | | 312 | | | | 624,789 | |
| | |
Crayon Group Holding ASA* (b) | | | 4,100 | | | | 23,635 | |
| | |
Darktrace plc* | | | 19,721 | | | | 83,757 | |
| | |
Dassault Systemes SE | | | 10,035 | | | | 411,710 | |
| | |
Descartes Systems Group, Inc. (The)* | | | 1,375 | | | | 99,273 | |
| | |
Enghouse Systems Ltd. | | | 2,552 | | | | 59,855 | |
| | |
Fortnox AB | | | 7,995 | | | | 31,586 | |
| | |
Fuji Soft, Inc. | | | 1,400 | | | | 49,919 | |
| | |
GB Group plc | | | 8,897 | | | | 25,803 | |
| | |
Hansen Technologies Ltd. | | | 5,576 | | | | 18,323 | |
| | |
IRESS Ltd.(a) | | | 10,123 | | | | 31,983 | |
| | |
Kinaxis, Inc.* (a) | | | 520 | | | | 50,725 | |
| | |
Lectra | | | 1,762 | | | | 44,512 | |
| | |
Lightspeed Commerce, Inc.* | | | 7,761 | | | | 96,771 | |
| | |
Money Forward, Inc.* | | | 1,100 | | | | 27,397 | |
| | |
Nemetschek SE | | | 884 | | | | 65,781 | |
| | |
Nice Ltd.* | | | 937 | | | | 144,665 | |
| | |
Open Text Corp. | | | 5,577 | | | | 186,000 | |
| | |
Oracle Corp. Japan | | | 800 | | | | 56,364 | |
| | |
QT Group OYJ* (a) | | | 308 | | | | 17,938 | |
| | |
Rakus Co. Ltd.(a) | | | 1,600 | | | | 19,608 | |
| | |
Sage Group plc (The) | | | 16,731 | | | | 197,053 | |
| | |
SAP SE | | | 15,132 | | | | 2,027,146 | |
| | |
Sinch AB* (b) | | | 14,637 | | | | 23,063 | |
| | |
SiteMinder Ltd.* | | | 17,179 | | | | 44,269 | |
| | |
Systena Corp. | | | 24,600 | | | | 41,421 | |
| | |
TeamViewer SE* (b) | | | 3,239 | | | | 49,625 | |
| | |
Technology One Ltd. | | | 5,166 | | | | 47,493 | |
| | |
Temenos AG (Registered) | | | 779 | | | | 55,760 | |
| | |
TomTom NV* | | | 6,776 | | | | 40,467 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 213 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – (continued) | |
| | |
Trend Micro, Inc. | | | 2,500 | | | $ | 93,136 | |
| | |
Truecaller AB, Class B* (a) | | | 16,113 | | | | 38,852 | |
| | |
Vitec Software Group AB, Class B | | | 1,025 | | | | 40,807 | |
| | |
WiseTech Global Ltd. | | | 3,081 | | | | 113,455 | |
| | | | | | | 5,351,086 | |
|
Specialized REITs – 0.0%(d) | |
| | |
Arena REIT, REIT | | | 15,269 | | | | 30,646 | |
| | |
Big Yellow Group plc, REIT | | | 4,224 | | | | 48,950 | |
| | |
Charter Hall Social Infrastructure REIT, REIT | | | 16,831 | | | | 25,363 | |
| | |
Keppel DC REIT, REIT | | | 21,100 | | | | 26,027 | |
| | |
National Storage REIT, REIT(a) | | | 20,921 | | | | 26,492 | |
| | |
Safestore Holdings plc, REIT | | | 4,488 | | | | 37,223 | |
| | | | | | | 194,701 | |
|
Specialty Retail – 1.4% | |
| | |
ABC-Mart, Inc. | | | 2,100 | | | | 32,316 | |
| | |
Accent Group Ltd. | | | 42,845 | | | | 50,864 | |
| | |
Alpen Co. Ltd.(a) | | | 4,600 | | | | 59,381 | |
| | |
ARCLANDS Corp.(a) | | | 19,518 | | | | 207,881 | |
| | |
Aritzia, Inc.* | | | 1,716 | | | | 26,662 | |
| | |
Autobacs Seven Co. Ltd. | | | 2,100 | | | | 21,507 | |
| | |
Bic Camera, Inc.(a) | | | 4,200 | | | | 31,699 | |
| | |
Bilia AB, Class A | | | 22,854 | | | | 211,712 | |
| | |
Carasso Motors Ltd.(a) | | | 11,193 | | | | 32,897 | |
| | |
CECONOMY AG* | | | 64,623 | | | | 122,269 | |
| | |
Currys plc | | | 366,912 | | | | 199,285 | |
| | |
DCM Holdings Co. Ltd. | | | 4,100 | | | | 31,891 | |
| | |
Delek Automotive Systems Ltd. | | | 18,837 | | | | 86,885 | |
| | |
Dufry AG (Registered)* (a) | | | 1,330 | | | | 46,343 | |
| | |
Dunelm Group plc | | | 3,649 | | | | 43,194 | |
| | |
Eagers Automotive Ltd.(a) | | | 4,180 | | | | 34,061 | |
| | |
EDION Corp.(a) | | | 27,300 | | | | 271,477 | |
| | |
Fast Retailing Co. Ltd. | | | 3,000 | | | | 654,099 | |
| | |
Fenix Outdoor International AG | | | 369 | | | | 21,864 | |
| | |
Fielmann Group AG | | | 607 | | | | 26,062 | |
| | |
Fnac Darty SA(a) | | | 7,051 | | | | 165,305 | |
| | |
Fox Wizel Ltd.(a) | | | 533 | | | | 30,237 | |
| | |
Frasers Group plc* | | | 4,620 | | | | 45,017 | |
| | |
Geo Holdings Corp.(a) | | | 8,000 | | | | 123,768 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Specialty Retail – (continued) | |
| | |
H & M Hennes & Mauritz AB, Class B | | | 7,596 | | | $ | 101,505 | |
| | |
Hornbach Holding AG & Co. KGaA | | | 3,081 | | | | 183,348 | |
| | |
Hour Glass Ltd. (The) | | | 93,600 | | | | 112,726 | |
| | |
IDOM, Inc. | | | 19,600 | | | | 117,254 | |
| | |
Industria de Diseno Textil SA(a) | | | 16,380 | | | | 563,560 | |
| | |
JB Hi-Fi Ltd.(a) | | | 1,722 | | | | 49,248 | |
| | |
JD Sports Fashion plc | | | 53,934 | | | | 83,444 | |
| | |
JINS Holdings, Inc.(a) | | | 900 | | | | 24,662 | |
| | |
Joyful Honda Co. Ltd. | | | 2,000 | | | | 23,348 | |
| | |
Kingfisher plc | | | 39,898 | | | | 101,573 | |
| | |
KMD Brands Ltd.(a) | | | 64,862 | | | | 31,313 | |
| | |
Kohnan Shoji Co. Ltd.(a) | | | 9,300 | | | | 240,107 | |
| | |
Komeri Co. Ltd. | | | 11,700 | | | | 241,811 | |
| | |
K’s Holdings Corp. | | | 6,100 | | | | 56,592 | |
| | |
Leon’s Furniture Ltd. | | | 6,840 | | | | 83,514 | |
| | |
Luk Fook Holdings International Ltd. | | | 117,672 | | | | 291,450 | |
| | |
MEKO AB | | | 14,235 | | | | 114,414 | |
| | |
Musti Group OYJ | | | 492 | | | | 9,678 | |
| | |
Nick Scali Ltd.(a) | | | 1,599 | | | | 10,914 | |
| | |
Nishimatsuya Chain Co. Ltd. | | | 15,600 | | | | 199,835 | |
| | |
Nitori Holdings Co. Ltd. | | | 1,600 | | | | 173,370 | |
| | |
Nojima Corp. | | | 23,400 | | | | 207,045 | |
| | |
Pet Valu Holdings Ltd.(a) | | | 1,716 | | | | 30,704 | |
| | |
Pets at Home Group plc | | | 24,204 | | | | 82,472 | |
| | |
Premier Investments Ltd.(a) | | | 1,517 | | | | 21,813 | |
| | |
Sanrio Co. Ltd. | | | 1,800 | | | | 76,067 | |
| | |
Shimamura Co. Ltd. | | | 500 | | | | 49,176 | |
| | |
Super Retail Group Ltd.(a) | | | 5,324 | | | | 44,428 | |
| | |
T-Gaia Corp. | | | 5,100 | | | | 60,515 | |
| | |
USS Co. Ltd. | | | 5,600 | | | | 97,120 | |
| | |
VT Holdings Co. Ltd. | | | 35,100 | | | | 117,506 | |
| | |
Watches of Switzerland Group plc*(c) | | | 13,640 | | | | 82,923 | |
| | |
WH Smith plc | | | 6,786 | | | | 95,520 | |
| | |
Yamada Holdings Co. Ltd. | | | 17,300 | | | | 54,580 | |
| | |
Yellow Hat Ltd. | | | 11,900 | | | | 143,088 | |
| | |
Zalando SE* (b) | | | 3,444 | | | | 80,050 | |
| | |
ZOZO, Inc.(a) | | | 2,800 | | | | 52,813 | |
| | | | | | | 6,686,162 | |
See Accompanying Notes to the Financial Statements.
| | | | |
214 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Technology Hardware, Storage & Peripherals – 0.3% | |
| | |
Brother Industries Ltd. | | | 4,000 | | | $ | 61,778 | |
| | |
Canon, Inc.(a) | | | 15,600 | | | | 365,780 | |
| | |
Eizo Corp.(a) | | | 1,500 | | | | 47,691 | |
| | |
Elecom Co. Ltd. | | | 1,600 | | | | 17,982 | |
| | |
FUJIFILM Holdings Corp. | | | 6,200 | | | | 335,822 | |
| | |
Konica Minolta, Inc.* | | | 14,200 | | | | 39,343 | |
| | |
Logitech International SA (Registered) | | | 2,759 | | | | 215,736 | |
| | |
MCJ Co. Ltd. | | | 23,400 | | | | 167,336 | |
| | |
Ricoh Co. Ltd.(a) | | | 12,100 | | | | 96,875 | |
| | |
Riso Kagaku Corp. | | | 1,700 | | | | 26,222 | |
| | |
Seiko Epson Corp. | | | 7,800 | | | | 106,948 | |
| | |
Toshiba TEC Corp. | | | 1,100 | | | | 23,642 | |
| | | | | | | 1,505,155 | |
|
Textiles, Apparel & Luxury Goods – 1.7% | |
| | |
adidas AG | | | 2,574 | | | | 454,904 | |
| | |
Asics Corp. | | | 3,400 | | | | 106,168 | |
| | |
Brunello Cucinelli SpA | | | 660 | | | | 52,914 | |
| | |
Burberry Group plc | | | 5,889 | | | | 120,910 | |
| | |
Canada Goose Holdings, Inc.* (a) | | | 2,464 | | | | 27,298 | |
| | |
Chow Sang Sang Holdings International Ltd. | | | 137,000 | | | | 157,580 | |
| | |
Cie Financiere Richemont SA (Registered) | | | 7,605 | | | | 893,329 | |
| | |
Coats Group plc | | | 93,931 | | | | 77,051 | |
| | |
Crystal International Group Ltd.(b) | | | 209,500 | | | | 63,456 | |
| | |
Delta Galil Ltd. | | | 3,588 | | | | 113,257 | |
| | |
Descente Ltd. | | | 1,200 | | | | 33,002 | |
| | |
Dr. Martens plc | | | 33,087 | | | | 46,734 | |
| | |
Gildan Activewear, Inc. | | | 2,703 | | | | 76,695 | |
| | |
Goldwin, Inc. | | | 1,000 | | | | 62,425 | |
| | |
Hermes International SCA | | | 507 | | | | 942,968 | |
| | |
HUGO BOSS AG | | | 1,232 | | | | 71,753 | |
| | |
Japan Wool Textile Co. Ltd. (The) | | | 21,900 | | | | 197,967 | |
| | |
Kering SA | | | 1,053 | | | | 426,510 | |
| | |
LPP SA | | | 24 | | | | 77,228 | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 3,861 | | | | 2,752,686 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Textiles, Apparel & Luxury Goods – (continued) | |
| | |
Moncler SpA | | | 2,925 | | | $ | 151,309 | |
| | |
New Wave Group AB, Class B | | | 5,104 | | | | 33,216 | |
| | |
Pandora A/S | | | 1,170 | | | | 132,254 | |
| | |
Puma SE | | | 1,599 | | | | 90,085 | |
| | |
Samsonite International SA* (b) | | | 24,600 | | | | 76,083 | |
| | |
Seiko Group Corp. | | | 1,200 | | | | 18,526 | |
| | |
Stella International Holdings Ltd. | | | 175,500 | | | | 198,275 | |
| | |
Swatch Group AG (The) | | | 429 | | | | 109,460 | |
| | |
Swatch Group AG (The) (Registered) | | | 792 | | | | 38,205 | |
| | |
Tod’s SpA* | | | 778 | | | | 25,986 | |
| | |
Wacoal Holdings Corp. | | | 4,100 | | | | 92,886 | |
| | |
Yue Yuen Industrial Holdings Ltd. | | | 273,000 | | | | 319,592 | |
| | | | | | | 8,040,712 | |
|
Tobacco – 0.5% | |
| | |
British American Tobacco plc | | | 46,761 | | | | 1,392,452 | |
| | |
Imperial Brands plc | | | 19,461 | | | | 413,498 | |
| | |
Japan Tobacco, Inc. | | | 15,600 | | | | 362,690 | |
| | |
Scandinavian Tobacco Group A/S(b) | | | 19,734 | | | | 292,600 | |
| | | | | | | 2,461,240 | |
|
Trading Companies & Distributors – 2.3% | |
| | |
AddTech AB, Class B | | | 4,180 | | | | 61,133 | |
| | |
Ashtead Group plc | | | 6,591 | | | | 376,219 | |
| | |
Azelis Group NV | | | 1,148 | | | | 19,536 | |
| | |
BayWa AG | | | 828 | | | | 27,569 | |
| | |
Beijer Ref AB, Class B(a) | | | 6,100 | | | | 57,710 | |
| | |
Bossard Holding AG (Registered), Class A | | | 220 | | | | 45,255 | |
| | |
Brenntag SE | | | 2,228 | | | | 165,132 | |
| | |
Bufab AB | | | 968 | | | | 22,908 | |
| | |
Bunzl plc | | | 5,304 | | | | 188,708 | |
| | |
Chori Co. Ltd. | | | 4,100 | | | | 78,673 | |
| | |
Daiichi Jitsugyo Co. Ltd. | | | 11,700 | | | | 149,644 | |
| | |
Diploma plc | | | 1,979 | | | | 68,248 | |
| | |
Finning International, Inc. | | | 2,562 | | | | 68,578 | |
| | |
Grafton Group plc | | | 11,661 | | | | 109,111 | |
| | |
Hanwa Co. Ltd. | | | 14,500 | | | | 431,807 | |
| | |
Howden Joinery Group plc | | | 11,221 | | | | 86,816 | |
| | |
IMCD NV | | | 936 | | | | 112,291 | |
| | |
Inaba Denki Sangyo Co. Ltd. | | | 4,100 | | | | 84,737 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 215 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Trading Companies & Distributors – (continued) | |
| | |
Inabata & Co. Ltd.(a) | | | 15,600 | | | $ | 322,414 | |
| | |
ITOCHU Corp.(a) | | | 31,200 | | | | 1,106,921 | |
| | |
Japan Pulp & Paper Co. Ltd. | | | 3,900 | | | | 121,420 | |
| | |
Kanamoto Co. Ltd.(a) | | | 11,700 | | | | 188,118 | |
| | |
Kanematsu Corp. | | | 27,300 | | | | 365,214 | |
| | |
Kloeckner & Co. SE | | | 26,793 | | | | 165,956 | |
| | |
Marubeni Corp. | | | 35,100 | | | | 504,789 | |
| | |
Mitani Corp. | | | 11,700 | | | | 106,999 | |
| | |
Mitsubishi Corp. | | | 29,500 | | | | 1,354,766 | |
| | |
Mitsui & Co. Ltd. | | | 32,800 | | | | 1,173,215 | |
| | |
MonotaRO Co. Ltd. | | | 5,600 | | | | 44,391 | |
| | |
Nagase & Co. Ltd. | | | 2,200 | | | | 33,027 | |
| | |
Nishio Holdings Co. Ltd. | | | 8,100 | | | | 177,837 | |
| | |
OEM International AB, Class B | | | 9,061 | | | | 58,797 | |
| | |
Reece Ltd.(a) | | | 3,403 | | | | 37,620 | |
| | |
Rexel SA | | | 4,415 | | | | 89,763 | |
| | |
Richelieu Hardware Ltd. | | | 3,422 | | | | 102,247 | |
| | |
RS GROUP plc | | | 4,346 | | | | 35,713 | |
| | |
Russel Metals, Inc. | | | 21,489 | | | | 534,806 | |
| | |
Scope Metals Group Ltd.* (a) | | | 1,845 | | | | 47,476 | |
| | |
Seven Group Holdings Ltd.(a) | | | 3,036 | | | | 53,323 | |
| | |
Sojitz Corp. | | | 3,999 | | | | 82,016 | |
| | |
Sumitomo Corp. | | | 25,600 | | | | 496,719 | |
| | |
Theme International Holdings Ltd.* (a) | | | 1,560,000 | | | | 115,635 | |
| | |
Thermador Groupe(a) | | | 396 | | | | 28,086 | |
| | |
Toromont Industries Ltd. | | | 1,230 | | | | 92,499 | |
| | |
Toyota Tsusho Corp. | | | 4,800 | | | | 250,578 | |
| | |
Travis Perkins plc | | | 74,568 | | | | 669,224 | |
| | |
Trusco Nakayama Corp. | | | 1,800 | | | | 26,873 | |
| | |
Yamazen Corp. | | | 23,400 | | | | 187,886 | |
| | |
Yellow Cake plc* (b) | | | 7,602 | | | | 50,920 | |
| | |
Yuasa Trading Co. Ltd.(a) | | | 7,800 | | | | 211,681 | |
| | | | | | | 10,991,004 | |
|
Transportation Infrastructure – 0.3% | |
| | |
Aena SME SA(b) | | | 975 | | | | 140,931 | |
| | |
Aeroports de Paris SA | | | 555 | | | | 62,066 | |
| | |
Atlas Arteria Ltd. | | | 18,448 | | | | 62,023 | |
| | |
Auckland International Airport Ltd. | | | 21,921 | | | | 93,588 | |
| | |
Dalrymple Bay Infrastructure Ltd. | | | 15,200 | | | | 26,081 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Transportation Infrastructure – (continued) | |
| | |
Enav SpA(b) | | | 12,657 | | | $ | 42,062 | |
| | |
Flughafen Zurich AG (Registered) | | | 320 | | | | 59,496 | |
| | |
Fraport AG Frankfurt Airport Services Worldwide* | | | 890 | | | | 43,960 | |
| | |
Getlink SE | | | 6,552 | | | | 105,509 | |
| | |
Hamburger Hafen und Logistik AG | | | 9,009 | | | | 159,407 | |
| | |
Japan Airport Terminal Co. Ltd. | | | 1,200 | | | | 52,534 | |
| | |
Kamigumi Co. Ltd. | | | 3,100 | | | | 62,432 | |
| | |
Mitsubishi Logistics Corp. | | | 1,700 | | | | 44,014 | |
| | |
Port of Tauranga Ltd. | | | 5,225 | | | | 15,499 | |
| | |
Qube Holdings Ltd.(a) | | | 36,652 | | | | 61,728 | |
| | |
SATS Ltd.* | | | 8,200 | | | | 14,723 | |
| | |
Sumitomo Warehouse Co. Ltd. (The) | | | 4,100 | | | | 65,191 | |
| | |
Transurban Group | | | 41,106 | | | | 307,630 | |
| | |
Westshore Terminals Investment Corp.(a) | | | 1,647 | | | | 27,750 | |
| | | | | | | 1,446,624 | |
|
Water Utilities – 0.1% | |
| | |
Pennon Group plc | | | 6,109 | | | | 53,855 | |
| | |
Severn Trent plc | | | 3,666 | | | | 118,153 | |
| | |
United Utilities Group plc | | | 9,945 | | | | 128,280 | |
| | | | | | | 300,288 | |
|
Wireless Telecommunication Services – 0.7% | |
| | |
1&1 AG | | | 13,338 | | | | 228,674 | |
| | |
Airtel Africa plc(b) | | | 34,804 | | | | 47,850 | |
| | |
Freenet AG | | | 4,141 | | | | 104,786 | |
| | |
KDDI Corp. | | | 23,400 | | | | 693,293 | |
| | |
Millicom International Cellular SA, SDR* | | | 4,102 | | | | 64,251 | |
| | |
Okinawa Cellular Telephone Co. | | | 7,800 | | | | 164,555 | |
| | |
Orange Belgium SA* | | | 1,188 | | | | 17,002 | |
| | |
Partner Communications Co. Ltd.* | | | 10,619 | | | | 38,559 | |
| | |
Rogers Communications, Inc., Class B | | | 5,811 | | | | 215,069 | |
| | |
SoftBank Corp. | | | 42,900 | | | | 482,977 | |
| | |
SoftBank Group Corp.(a) | | | 15,600 | | | | 630,819 | |
| | |
StarHub Ltd. | | | 61,500 | | | | 46,236 | |
| | |
Tele2 AB, Class B | | | 8,052 | | | | 57,035 | |
See Accompanying Notes to the Financial Statements.
| | | | |
216 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Vodafone Group plc | | | 474,123 | | | $ | 435,521 | |
| | | | | | | 3,226,627 | |
Total Common Stocks (Cost $439,086,097) | | | | 461,953,866 | |
| | |
| | | | | | | | |
|
CLOSED END FUNDS – 0.0%(d) | |
|
Independent Power and Renewable Electricity Producers – 0.0%(d) | |
| | |
Renewables Infrastructure Group Ltd. (The) (Cost $70,852) | | | 47,630 | | | | 58,143 | |
| | Number of Rights | | | | |
|
RIGHTS – 0.0%(d) | |
|
Containers & Packaging – 0.0%(d) | |
| | |
Vidrala SA, expiring 11/2/2023* | | | 560 | | | | 2,063 | |
|
Passenger Airlines – 0.0%(d) | |
| | |
Finnair OYJ, expiring 11/3/2023, price 0.03 EUR* | | | 82,324 | | | | 32,422 | |
Total Rights (Cost $36,380) | | | | 34,485 | |
| | Number of Warrants | | | | |
|
WARRANTS – 0.0% | |
|
Construction & Engineering – 0.0% | |
| | |
Webuild SpA, expiring 8/2/2030*‡(a) | | | 10,785 | | | | — | |
|
Software – 0.0% | |
| | |
Constellation Software, Inc., expiring 3/31/2040, price 11.50 CAD* ‡ | | | 280 | | | | — | |
Total Warrants (Cost $–) | | | | | | | — | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 1.9%(f) | |
|
INVESTMENT COMPANIES – 0.2% | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 (Cost $1,000,000) | | $ | 1,000,000 | | | $ | 1,000,000 | |
| | |
| | | | | | | | |
|
REPURCHASE AGREEMENTS – 1.7% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $7,382,140, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $7,464,989 | | | 7,381,058 | | | | 7,381,058 | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $379,451, collateralized by various Common Stocks; total market value $420,182 | | | 379,394 | | | | 379,394 | |
Total Repurchase Agreements (Cost $7,760,452) | | | | 7,760,452 | |
Total Securities Lending Reinvestments (Cost $8,760,452) | | | | 8,760,452 | |
Total Investments – 100.3% (Cost $447,953,781) | | | | 470,806,946 | |
| |
Liabilities in excess of other assets – (0.3%) | | | | (1,568,121 | ) |
NET ASSETS – 100.0% | | | $ | 469,238,825 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $53,104,871, collateralized in the form of cash with a value of $8,760,452 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $38,403,500 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 15, 2023 – |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 217 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| August 15, 2053 and $11,001,357 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $58,165,309. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(d) | Represents less than 0.05% of net assets. |
(e) | Amount less than one dollar. |
(f) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $8,760,452. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
CHDI – Clearing House Electronic Subregister System (CHESS) Depository Interest
CVA – Dutch Certification
OYJ – Public Limited Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA – Limited partnership with share capital
SDR – Swedish Depositary Receipt
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 77,056,355 | |
Aggregate gross unrealized depreciation | | | (58,985,396 | ) |
Net unrealized appreciation | | $ | 18,070,959 | |
Federal income tax cost | | $ | 452,376,331 | |
Futures Contracts
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
EURO STOXX 50 Index | | | 45 | | | | 12/15/2023 | | | | EUR | | | $ | 1,935,896 | | | $ | (83,880 | ) |
FTSE 100 Index | | | 17 | | | | 12/15/2023 | | | | GBP | | | | 1,511,667 | | | | (52,659 | ) |
Nikkei 225 Index | | | 18 | | | | 12/07/2023 | | | | JPY | | | | 1,834,825 | | | | (79,339 | ) |
S&P/TSX 60 Index | | | 9 | | | | 12/14/2023 | | | | CAD | | | | 1,471,637 | | | | (73,953 | ) |
SPI 200 Index | | | 6 | | | | 12/21/2023 | | | | AUD | | | | 644,198 | | | | (39,934 | ) |
| | | | | | | | | | | | | | | | | | $ | (329,765 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
See Accompanying Notes to the Financial Statements.
| | | | |
218 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
Forward Foreign Currency Contracts
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 680,268 | | | | | BNP Paribas SA | | JPY | | | 100,000,000 | | | | 12/20/2023 | | | $ | 14,407 | |
Total unrealized appreciation | | | | | | | $ | 14,407 | |
CAD | | | 723,792 | | | | | Citibank NA | | USD | | | 534,925 | | | | 12/20/2023 | | | $ | (13,108 | ) |
GBP | | | 323,203 | | | | | Toronto-Dominion Bank (The) | | USD | | | 402,451 | | | | 12/20/2023 | | | | (10,107 | ) |
JPY | | | 96,108,298 | | | | | Toronto-Dominion Bank (The) | | USD | | | 661,031 | | | | 12/20/2023 | | | | (21,083 | ) |
Total unrealized depreciation | | | $ | (44,298 | ) |
Net unrealized depreciation | | | $ | (29,891 | ) |
Abbreviations:
AUD – Australian Dollar
CAD – Canadian Dollar
EUR – Euro
GBP – British Pound
JPY – Japanese Yen
USD – US Dollar
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 5.7 | % |
Austria | | | 0.3 | |
Belgium | | | 1.1 | |
Canada | | | 10.9 | |
Denmark | | | 2.4 | |
Finland | | | 0.7 | |
France | | | 7.3 | |
Germany | | | 6.4 | |
Hong Kong | | | 2.1 | |
Ireland | | | 0.3 | |
Israel | | | 1.1 | |
Italy | | | 3.0 | |
Japan | | | 26.6 | |
Netherlands | | | 3.1 | |
New Zealand | | | 0.3 | |
Norway | | | 1.4 | |
Poland | | | 0.5 | |
Portugal | | | 0.2 | |
Singapore | | | 1.2 | |
Spain | | | 2.3 | |
Sweden | | | 3.1 | |
Switzerland | | | 5.8 | |
United Kingdom | | | 12.6 | |
Other1 | | | 1.6 | |
| | | 100.0 | % |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 219 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.4 | % |
Closed End Funds | | | 0.0 | † |
Rights | | | 0.0 | † |
Warrants | | | — | |
Securities Lending Reinvestments | | | 1.9 | |
Others(1) | | | (0.3 | ) |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
220 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 100.1% | |
|
Aerospace & Defense – 0.3% | |
| | |
AECC Aviation Power Co. Ltd., Class A | | | 4,700 | | | $ | 22,703 | |
| | |
Aselsan Elektronik Sanayi ve Ticaret A/S | | | 34,545 | | | | 50,475 | |
| | |
AviChina Industry & Technology Co. Ltd., Class H(a) | | | 81,000 | | | | 36,646 | |
| | |
Bharat Dynamics Ltd.(b) | | | 705 | | | | 8,249 | |
| | |
Bharat Electronics Ltd. | | | 59,406 | | | | 95,075 | |
| | |
Colt CZ Group SE | | | 3,149 | | | | 75,292 | |
| | |
Data Patterns India Ltd. | | | 588 | | | | 13,188 | |
| | |
Embraer SA* | | | 9,400 | | | | 32,787 | |
| | |
Hanwha Aerospace Co. Ltd. | | | 564 | | | | 42,178 | |
| | |
Hanwha Systems Co. Ltd. | | | 689 | | | | 6,479 | |
| | |
Hindustan Aeronautics Ltd.(b) | | | 3,279 | | | | 71,798 | |
| | |
Korea Aerospace Industries Ltd. | | | 1,128 | | | | 36,917 | |
| | |
Kuang-Chi Technologies Co. Ltd., Class A | | | 5,600 | | | | 10,706 | |
| | |
LIG Nex1 Co. Ltd. | | | 250 | | | | 16,123 | |
| | |
Mazagon Dock Shipbuilders Ltd. | | | 1,175 | | | | 27,757 | |
| | |
United Aircraft Corp. PAO* ‡ | | | 25,155,036 | | | | — | |
| | | | | | | 546,373 | |
|
Air Freight & Logistics – 0.3% | |
| | |
Abu Dhabi Aviation Co. | | | 5,978 | | | | 10,953 | |
| | |
Agility Public Warehousing Co. KSC* | | | 26,571 | | | | 45,151 | |
| | |
Allcargo Logistics Ltd. | | | 29,563 | | | | 90,810 | |
| | |
Aramex PJSC | | | 32,940 | | | | 20,627 | |
| | |
Blue Dart Express Ltd. | | | 245 | | | | 19,361 | |
| | |
CJ Logistics Corp. | | | 245 | | | | 13,769 | |
| | |
Delhivery Ltd.* | | | 7,008 | | | | 34,792 | |
| | |
Hyundai Glovis Co. Ltd. | | | 658 | | | | 83,361 | |
| | |
JD Logistics, Inc.* (a) (b) | | | 28,200 | | | | 33,373 | |
| | |
Kerry Express Thailand PCL, NVDR* | | | 8,700 | | | | 1,123 | |
| | |
Kerry TJ Logistics Co. Ltd. | | | 8,000 | | | | 9,151 | |
| | |
SCGJWD Logistics PCL, NVDR | | | 29,300 | | | | 9,456 | |
| | |
SF Holding Co. Ltd., Class A | | | 7,300 | | | | 39,203 | |
| | |
Sinotrans Ltd., Class A | | | 4,700 | | | | 2,820 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Air Freight & Logistics – (continued) | |
| | |
Sinotrans Ltd., Class H | | | 47,000 | | | $ | 15,437 | |
| | |
YTO Express Group Co. Ltd., Class A | | | 4,700 | | | | 8,722 | |
| | |
Yunda Holding Co. Ltd., Class A | | | 5,800 | | | | 7,220 | |
| | |
ZTO Express Cayman, Inc. | | | 7,050 | | | | 164,974 | |
| | | | | | | 610,303 | |
|
Automobile Components – 1.2% | |
| | |
Apollo Tyres Ltd. | | | 4,465 | | | | 20,448 | |
| | |
Asahi India Glass Ltd. | | | 4,900 | | | | 32,905 | |
| | |
Balkrishna Industries Ltd. | | | 1,225 | | | | 37,574 | |
| | |
Bharat Forge Ltd. | | | 3,791 | | | | 46,414 | |
| | |
Bosch Ltd. | | | 147 | | | | 34,342 | |
| | |
Ceat Ltd. | | | 799 | | | | 20,235 | |
| | |
Cheng Shin Rubber Industry Co. Ltd. | | | 34,272 | | | | 46,650 | |
| | |
CIE Automotive India Ltd. | | | 1,715 | | | | 9,478 | |
| | |
Cub Elecparts, Inc. | | | 3,269 | | | | 13,203 | |
| | |
Depo Auto Parts Ind Co. Ltd. | | | 43,152 | | | | 172,954 | |
| | |
DN Automotive Corp. | | | 1,457 | | | | 85,335 | |
| | |
Endurance Technologies Ltd.(b) | | | 350 | | | | 6,711 | |
| | |
Exide Industries Ltd. | | | 8,526 | | | | 26,154 | |
| | |
Fuyao Glass Industry Group Co. Ltd., Class A | | | 4,800 | | | | 24,400 | |
| | |
Fuyao Glass Industry Group Co. Ltd., Class H(b) | | | 8,400 | | | | 38,272 | |
| | |
Hankook & Co. Co Ltd. | | | 907 | | | | 8,247 | |
| | |
Hankook Tire & Technology Co. Ltd. | | | 2,392 | | | | 67,657 | |
| | |
Hanon Systems | | | 2,756 | | | | 14,040 | |
| | |
HL Mando Co. Ltd. | | | 1,045 | | | | 25,341 | |
| | |
Hota Industrial Manufacturing Co. Ltd. | | | 12,134 | | | | 23,157 | |
| | |
Huayu Automotive Systems Co. Ltd., Class A | | | 9,400 | | | | 22,530 | |
| | |
Hyundai Mobis Co. Ltd. | | | 1,692 | | | | 261,214 | |
| | |
Hyundai Wia Corp. | | | 583 | | | | 24,174 | |
| | |
Iljin Hysolus Co. Ltd.* | | | 383 | | | | 5,445 | |
| | |
JBM Auto Ltd. | | | 784 | | | | 11,305 | |
| | |
Kordsa Teknik Tekstil A/S | | | 23,265 | | | | 68,662 | |
| | |
Kumho Tire Co., Inc.* | | | 5,635 | | | | 17,545 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 221 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Automobile Components – (continued) | |
| | |
Minda Corp. Ltd. | | | 3,724 | | | $ | 14,572 | |
| | |
Minth Group Ltd. | | | 22,000 | | | | 49,035 | |
| | |
Motherson Sumi Wiring India Ltd. | | | 30,126 | | | | 21,692 | |
| | |
MRF Ltd. | | | 38 | | | | 49,428 | |
| | |
Myoung Shin Industrial Co. Ltd.* | | | 11,609 | | | | 134,696 | |
| | |
Nan Kang Rubber Tire Co. Ltd.* | | | 14,000 | | | | 15,798 | |
| | |
Nexen Tire Corp. | | | 12,517 | | | | 69,047 | |
| | |
Nexteer Automotive Group Ltd. | | | 282,000 | | | | 135,871 | |
| | |
Ningbo Tuopu Group Co. Ltd., Class A | | | 1,200 | | | | 10,567 | |
| | |
Samvardhana Motherson International Ltd. | | | 37,565 | | | | 41,486 | |
| | |
Sebang Global Battery Co. Ltd. | | | 2,115 | | | | 77,283 | |
| | |
SL Corp. | | | 550 | | | | 12,095 | |
| | |
SNT Motiv Co. Ltd. | | | 3,290 | | | | 98,294 | |
| | |
Sona Blw Precision Forgings Ltd.(b) | | | 5,145 | | | | 33,462 | |
| | |
Sri Trang Agro-Industry PCL, NVDR | | | 305,500 | | | | 122,395 | |
| | |
Sundram Fasteners Ltd. | | | 1,504 | | | | 22,663 | |
| | |
Sungwoo Hitech Co. Ltd. | | | 2,205 | | | | 12,865 | |
| | |
Tianneng Power International Ltd.(a) | | | 264,000 | | | | 238,203 | |
| | |
Tong Yang Industry Co. Ltd. | | | 9,072 | | | | 20,502 | |
| | |
Tube Investments of India Ltd. | | | 1,645 | | | | 62,241 | |
| | |
Tung Thih Electronic Co. Ltd. | | | 2,872 | | | | 11,732 | |
| | |
TVS Holdings Ltd. | | | 2,115 | | | | 137,547 | |
| | |
TVS Holdings Pvt Ltd.* | | | 2,160 | | | | 26,496 | |
| | |
UNO Minda Ltd. | | | 3,740 | | | | 26,175 | |
| | |
Weifu High-Technology Group Co. Ltd., Class A | | | 4,700 | | | | 10,372 | |
| | | | | | | 2,618,909 | |
|
Automobiles – 2.0% | |
| | |
Bajaj Auto Ltd. | | | 1,105 | | | | 70,528 | |
| | |
Brilliance China Automotive Holdings Ltd. | | | 96,000 | | | | 44,046 | |
| | |
BYD Co. Ltd., Class A | | | 2,600 | | | | 84,749 | |
| | |
BYD Co. Ltd., Class H | | | 15,000 | | | | 455,103 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Automobiles – (continued) | |
| | |
China Motor Corp. | | | 7,000 | | | $ | 18,711 | |
| | |
Chongqing Changan Automobile Co. Ltd., Class A | | | 17,108 | | | | 35,370 | |
| | |
Chongqing Changan Automobile Co. Ltd., Class B | | | 4,890 | | | | 2,250 | |
| | |
Dongfeng Motor Group Co. Ltd., Class H | | | 940,000 | | | | 413,261 | |
| | |
DRB-Hicom Bhd. | | | 347,800 | | | | 101,468 | |
| | |
Eicher Motors Ltd. | | | 2,370 | | | | 93,809 | |
| | |
Ford Otomotiv Sanayi A/S | | | 1,736 | | | | 48,246 | |
| | |
Geely Automobile Holdings Ltd. | | | 141,000 | | | | 159,838 | |
| | |
Great Wall Motor Co. Ltd., Class A | | | 4,700 | | | | 18,869 | |
| | |
Great Wall Motor Co. Ltd., Class H | | | 47,000 | | | | 65,593 | |
| | |
Guangzhou Automobile Group Co. Ltd., Class A | | | 13,500 | | | | 18,484 | |
| | |
Guangzhou Automobile Group Co. Ltd., Class H | | | 94,000 | | | | 43,969 | |
| | |
Hero MotoCorp Ltd. | | | 2,021 | | | | 74,966 | |
| | |
Hyundai Motor Co. | | | 3,713 | | | | 466,548 | |
| | |
Hyundai Motor Co. (2nd Preference) | | | 893 | | | | 66,187 | |
| | |
Hyundai Motor Co. (3rd Preference) | | | 54 | | | | 3,978 | |
| | |
Hyundai Motor Co. (Preference) | | | 624 | | | | 46,019 | |
| | |
Kia Corp. | | | 6,815 | | | | 388,045 | |
| | |
Li Auto, Inc., Class A* | | | 18,100 | | | | 309,277 | |
| | |
Mahindra & Mahindra Ltd. | | | 15,134 | | | | 265,131 | |
| | |
Maruti Suzuki India Ltd. | | | 2,115 | | | | 263,993 | |
| | |
NIO, Inc., Class A* (a) | | | 22,090 | | | | 163,460 | |
| | |
Oriental Holdings Bhd. | | | 8,500 | | | | 11,239 | |
| | |
SAIC Motor Corp. Ltd., Class A | | | 23,500 | | | | 46,627 | |
| | |
Sanyang Motor Co. Ltd. | | | 10,824 | | | | 22,192 | |
| | |
Seres Group Co. Ltd., Class A* | | | 4,800 | | | | 53,450 | |
| | |
Tata Motors Ltd. | | | 26,461 | | | | 199,795 | |
| | |
Tata Motors Ltd., Class A | | | 8,059 | | | | 40,663 | |
| | |
Tofas Turk Otomobil Fabrikasi A/S | | | 3,233 | | | | 27,505 | |
| | |
TVS Motor Co. Ltd. | | | 3,351 | | | | 64,027 | |
| | |
UMW Holdings Bhd. | | | 14,100 | | | | 14,353 | |
| | |
XPeng, Inc., Class A* (a) | | | 18,800 | | | | 138,875 | |
See Accompanying Notes to the Financial Statements.
| | | | |
222 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Automobiles – (continued) | |
| | |
Yadea Group Holdings Ltd.(b) | | | 16,000 | | | $ | 29,241 | |
| | |
Yulon Motor Co. Ltd. | | | 18,120 | | | | 41,396 | |
| | | | | | | 4,411,261 | |
|
Banks – 13.7% | |
| | |
Absa Group Ltd. | | | 22,889 | | | | 207,464 | |
| | |
Abu Dhabi Commercial Bank PJSC | | | 84,698 | | | | 185,169 | |
| | |
Abu Dhabi Islamic Bank PJSC | | | 39,950 | | | | 112,030 | |
| | |
AFFIN Bank Bhd. | | | 6,973 | | | | 2,956 | |
| | |
Agricultural Bank of China Ltd., Class A | | | 377,100 | | | | 184,992 | |
| | |
Agricultural Bank of China Ltd., Class H | | | 799,000 | | | | 295,109 | |
| | |
Akbank TAS, ADR(a) | | | 37,378 | | | | 75,130 | |
| | |
Al Ahli Bank of Kuwait KSCP | | | 12,693 | | | | 8,775 | |
| | |
Al Rajhi Bank | | | 30,033 | | | | 537,161 | |
| | |
Alinma Bank | | | 15,169 | | | | 133,026 | |
| | |
Alliance Bank Malaysia Bhd. | | | 27,600 | | | | 19,869 | |
| | |
Alpha Services and Holdings SA* | | | 60,442 | | | | 90,081 | |
| | |
AMMB Holdings Bhd. | | | 51,700 | | | | 41,451 | |
| | |
AU Small Finance Bank Ltd.(b) | | | 4,794 | | | | 38,526 | |
| | |
Axis Bank Ltd. | | | 36,049 | | | | 425,117 | |
| | |
BAC Holding International Corp. | | | 98,352 | | | | 4,945 | |
| | |
Banco Bradesco SA | | | 43,800 | | | | 106,742 | |
| | |
Banco Bradesco SA (Preference) | | | 145,700 | | | | 404,193 | |
| | |
Banco de Bogota SA | | | 3,242 | | | | 19,514 | |
| | |
Banco de Chile | | | 1,145,202 | | | | 117,275 | |
| | |
Banco de Credito e Inversiones SA | | | 2,081 | | | | 49,597 | |
| | |
Banco del Bajio SA(b) | | | 18,800 | | | | 57,463 | |
| | |
Banco do Brasil SA | | | 37,600 | | | | 360,492 | |
| | |
Banco do Estado do Rio Grande do Sul SA (Preference), Class B | | | 79,900 | | | | 172,697 | |
| | |
Banco Itau Chile SA | | | 2,352 | | | | 20,588 | |
| | |
Banco Santander Chile | | | 1,814,341 | | | | 78,846 | |
| | |
Bancolombia SA | | | 8,460 | | | | 60,021 | |
| | |
Bancolombia SA (Preference) | | | 13,187 | | | | 84,154 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Bandhan Bank Ltd.(b) | | | 11,877 | | | $ | 30,549 | |
| | |
Bangkok Bank PCL, NVDR | | | 14,400 | | | | 63,101 | |
| | |
Bank Aladin Syariah Tbk. PT* | | | 279,300 | | | | 18,286 | |
| | |
Bank AlBilad | | | 8,024 | | | | 79,564 | |
| | |
Bank Al-Jazira* | | | 6,066 | | | | 26,453 | |
| | |
Bank BTPN Syariah Tbk. PT | | | 949,400 | | | | 94,133 | |
| | |
Bank Central Asia Tbk. PT | | | 836,600 | | | | 460,828 | |
| | |
Bank Ina Perdana PT* | | | 14,100 | | | | 3,675 | |
| | |
Bank Islam Malaysia Bhd. | | | 44,100 | | | | 19,900 | |
| | |
Bank Jago Tbk. PT* | | | 9,800 | | | | 972 | |
| | |
Bank Mandiri Persero Tbk. PT | | | 1,226,700 | | | | 438,245 | |
| | |
Bank Negara Indonesia Persero Tbk. PT | | | 413,600 | | | | 124,718 | |
| | |
Bank OCBC Nisp Tbk. PT | | | 1,217,300 | | | | 85,062 | |
| | |
Bank of Ayudhya PCL, NVDR | | | 51,600 | | | | 40,915 | |
| | |
Bank of Baroda | | | 30,406 | | | | 71,652 | |
| | |
Bank of Beijing Co. Ltd., Class A | | | 67,200 | | | | 41,873 | |
| | |
Bank of Changsha Co. Ltd., Class A | | | 9,400 | | | | 9,441 | |
| | |
Bank of Chengdu Co. Ltd., Class A | | | 10,600 | | | | 17,903 | |
| | |
Bank of China Ltd., Class A | | | 192,700 | | | | 102,695 | |
| | |
Bank of China Ltd., Class H | | | 2,303,000 | | | | 806,459 | |
| | |
Bank of Chongqing Co. Ltd., Class A | | | 14,700 | | | | 15,306 | |
| | |
Bank of Communications Co. Ltd., Class A | | | 98,100 | | | | 75,471 | |
| | |
Bank of Communications Co. Ltd., Class H | | | 564,000 | | | | 333,732 | |
| | |
Bank of Hangzhou Co. Ltd., Class A | | | 18,800 | | | | 27,488 | |
| | |
Bank of India | | | 21,338 | | | | 24,565 | |
| | |
Bank of Jiangsu Co. Ltd., Class A | | | 41,780 | | | | 39,393 | |
| | |
Bank of Nanjing Co. Ltd., Class A | | | 31,200 | | | | 33,425 | |
| | |
Bank of Ningbo Co. Ltd., Class A | | | 15,750 | | | | 53,783 | |
| | |
Bank of Qingdao Co. Ltd., Class H(b) | | | 23,500 | | | | 5,977 | |
| | |
Bank of Shanghai Co. Ltd., Class A | | | 45,000 | | | | 37,325 | |
| | |
Bank of the Philippine Islands | | | 30,534 | | | | 54,083 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 223 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Bank of Xi’an Co. Ltd., Class A | | | 4,900 | | | $ | 2,323 | |
| | |
Bank of Zhengzhou Co. Ltd., Class A* | | | 19,239 | | | | 5,495 | |
| | |
Bank Pan Indonesia Tbk. PT* | | | 71,500 | | | | 5,109 | |
| | |
Bank Pembangunan Daerah Jawa Barat Dan Banten Tbk. PT | | | 2,331,200 | | | | 166,567 | |
| | |
Bank Pembangunan Daerah Jawa Timur Tbk. PT | | | 1,311,300 | | | | 49,943 | |
| | |
Bank Rakyat Indonesia Persero Tbk. PT | | | 1,137,400 | | | | 355,147 | |
| | |
Bank Tabungan Negara Persero Tbk. PT | | | 2,293,624 | | | | 176,877 | |
| | |
Banque Saudi Fransi | | | 16,121 | | | | 154,051 | |
| | |
BDO Unibank, Inc. | | | 32,900 | | | | 73,929 | |
| | |
BNK Financial Group, Inc. | | | 8,037 | | | | 40,347 | |
| | |
BOC Hong Kong Holdings Ltd. | | | 94,000 | | | | 248,677 | |
| | |
Boubyan Bank KSCP | | | 20,257 | | | | 38,348 | |
| | |
Burgan Bank SAK | | | 31,504 | | | | 16,589 | |
| | |
Canara Bank | | | 9,343 | | | | 43,130 | |
| | |
Capitec Bank Holdings Ltd. | | | 1,432 | | | | 126,410 | |
| | |
Chang Hwa Commercial Bank Ltd. | | | 113,791 | | | | 60,167 | |
| | |
China Banking Corp. | | | 44,100 | | | | 23,511 | |
| | |
China Bohai Bank Co. Ltd., Class H* (a) (b) | | | 1,057,500 | | | | 155,423 | |
| | |
China CITIC Bank Corp. Ltd., Class H | | | 235,000 | | | | 104,817 | |
| | |
China Construction Bank Corp., Class A | | | 28,200 | | | | 24,161 | |
| | |
China Construction Bank Corp., Class H | | | 2,679,000 | | | | 1,520,175 | |
| | |
China Everbright Bank Co. Ltd., Class A | | | 112,800 | | | | 45,779 | |
| | |
China Everbright Bank Co. Ltd., Class H | | | 53,000 | | | | 15,105 | |
| | |
China Merchants Bank Co. Ltd., Class A | | | 42,300 | | | | 177,799 | |
| | |
China Merchants Bank Co. Ltd., Class H | | | 94,000 | | | | 357,999 | |
| | |
China Minsheng Banking Corp. Ltd., Class A | | | 79,900 | | | | 40,615 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
China Minsheng Banking Corp. Ltd., Class H(a) | | | 141,000 | | | $ | 46,852 | |
| | |
China Zheshang Bank Co. Ltd., Class A | | | 61,100 | | | | 21,290 | |
| | |
China Zheshang Bank Co. Ltd., Class H | | | 68,900 | | | | 17,083 | |
| | |
Chongqing Rural Commercial Bank Co. Ltd., Class A | | | 18,800 | | | | 10,918 | |
| | |
Chongqing Rural Commercial Bank Co. Ltd., Class H | | | 47,000 | | | | 17,780 | |
| | |
CIMB Group Holdings Bhd. | | | 199,640 | | | | 239,258 | |
| | |
City Union Bank Ltd. | | | 9,675 | | | | 16,048 | |
| | |
CNPC Capital Co. Ltd., Class A | | | 28,800 | | | | 23,337 | |
| | |
Commercial Bank PSQC (The) | | | 87,561 | | | | 123,273 | |
| | |
Commercial International Bank Egypt SAE | | | 65,326 | | | | 127,483 | |
| | |
Credicorp Ltd. | | | 1,786 | | | | 223,179 | |
| | |
Credit Agricole Egypt SAE* | | | 200,173 | | | | 118,712 | |
| | |
Credit Bank of Moscow PJSC* ‡ | | | 229,590 | | | | — | |
| | |
CTBC Financial Holding Co. Ltd. | | | 517,000 | | | | 388,129 | |
| | |
DGB Financial Group, Inc. | | | 5,243 | | | | 30,514 | |
| | |
Doha Bank QPSC | | | 885,292 | | | | 368,365 | |
| | |
Dubai Islamic Bank PJSC | | | 80,981 | | | | 119,057 | |
| | |
Dukhan Bank | | | 40,138 | | | | 39,973 | |
| | |
E.Sun Financial Holding Co. Ltd. | | | 255,160 | | | | 187,623 | |
| | |
Emirates NBD Bank PJSC | | | 69,560 | | | | 321,002 | |
| | |
Equitas Small Finance Bank Ltd.(b) | | | 23,177 | | | | 25,819 | |
| | |
Eurobank Ergasias Services and Holdings SA* | | | 57,716 | | | | 94,071 | |
| | |
Faisal Islamic Bank of Egypt | | | 60,912 | | | | 60,364 | |
| | |
Far Eastern International Bank | | | 111,625 | | | | 39,577 | |
| | |
Federal Bank Ltd. | | | 29,186 | | | | 49,304 | |
| | |
First Abu Dhabi Bank PJSC | | | 66,599 | | | | 229,914 | |
| | |
First Financial Holding Co. Ltd. | | | 183,520 | | | | 146,544 | |
| | |
Grupo Aval Acciones y Valores SA (Preference) | | | 116,179 | | | | 12,918 | |
| | |
Grupo Bolivar SA | | | 1,518 | | | | 18,626 | |
| | |
Grupo Elektra SAB de CV(a) | | | 940 | | | | 60,072 | |
| | |
Grupo Financiero Banorte SAB de CV, Class O | | | 65,800 | | | | 533,311 | |
See Accompanying Notes to the Financial Statements.
| | | | |
224 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Grupo Financiero Inbursa SAB de CV, Class O* (a) | | | 27,946 | | | $ | 57,555 | |
| | |
Grupo Security SA | | | 458,250 | | | | 104,072 | |
| | |
Gulf Bank KSCP | | | 45,156 | | | | 34,573 | |
| | |
Haci Omer Sabanci Holding A/S | | | 30,173 | | | | 57,055 | |
| | |
Hana Financial Group, Inc. | | | 7,990 | | | | 231,911 | |
| | |
HDFC Bank Ltd. | | | 86,809 | | | | 1,539,460 | |
| | |
Hong Leong Bank Bhd. | | | 14,100 | | | | 57,412 | |
| | |
Hong Leong Financial Group Bhd. | | | 4,900 | | | | 18,059 | |
| | |
Hua Nan Financial Holdings Co. Ltd. | | | 155,065 | | | | 97,050 | |
| | |
Huaxia Bank Co. Ltd., Class A | | | 47,000 | | | | 35,966 | |
| | |
ICICI Bank Ltd. | | | 79,665 | | | | 875,840 | |
| | |
IDFC First Bank Ltd.* | | | 44,885 | | | | 44,584 | |
| | |
Indian Bank | | | 7,425 | | | | 37,460 | |
| | |
IndusInd Bank Ltd. | | | 9,135 | | | | 158,137 | |
| | |
Industrial & Commercial Bank of China Ltd., Class A | | | 244,400 | | | | 157,966 | |
| | |
Industrial & Commercial Bank of China Ltd., Class H | | | 1,927,000 | | | | 925,992 | |
| | |
Industrial Bank Co. Ltd., Class A | | | 51,700 | | | | 106,535 | |
| | |
Industrial Bank of Korea | | | 7,144 | | | | 59,086 | |
| | |
Intercorp Financial Services, Inc.(b) | | | 1,040 | | | | 19,594 | |
| | |
Itau Unibanco Holding SA (Preference) | | | 131,600 | | | | 699,883 | |
| | |
Itausa SA* | | | 2,548 | | | | 4,337 | |
| | |
Itausa SA | | | 28,065 | | | | 48,862 | |
| | |
Itausa SA (Preference) | | | 136,300 | | | | 233,518 | |
| | |
JB Financial Group Co. Ltd. | | | 3,370 | | | | 25,202 | |
| | |
Jiangsu Changshu Rural Commercial Bank Co. Ltd., Class A | | | 6,700 | | | | 6,738 | |
| | |
KakaoBank Corp. | | | 5,029 | | | | 67,622 | |
| | |
Karur Vysya Bank Ltd. (The) | | | 156,416 | | | | 268,838 | |
| | |
Kasikornbank PCL, NVDR | | | 32,800 | | | | 120,003 | |
| | |
KB Financial Group, Inc. | | | 10,152 | | | | 387,122 | |
| | |
Kiatnakin Phatra Bank PCL, NVDR | | | 9,800 | | | | 13,428 | |
| | |
King’s Town Bank Co. Ltd. | | | 24,000 | | | | 27,489 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Komercni Banka A/S | | | 2,068 | | | $ | 60,473 | |
| | |
Kotak Mahindra Bank Ltd. | | | 16,638 | | | | 347,593 | |
| | |
Krung Thai Bank PCL, NVDR | | | 108,000 | | | | 56,490 | |
| | |
Kuwait Finance House KSCP | | | 133,292 | | | | 294,530 | |
| | |
Kuwait International Bank KSCP | | | 38,492 | | | | 18,279 | |
| | |
Kuwait Projects Co. Holding KSCP* | | | 56,513 | | | | 19,352 | |
| | |
LH Financial Group PCL, NVDR | | | 1,616,800 | | | | 44,533 | |
| | |
Malayan Banking Bhd. | | | 192,700 | | | | 364,814 | |
| | |
Malaysia Building Society Bhd. | | | 14,100 | | | | 2,146 | |
| | |
Masraf Al Rayan QSC | | | 83,848 | | | | 48,361 | |
| | |
Mega Financial Holding Co. Ltd. | | | 182,269 | | | | 206,236 | |
| | |
Metropolitan Bank & Trust Co. | | | 30,870 | | | | 28,454 | |
| | |
Moneta Money Bank A/S(b) | | | 143,115 | | | | 552,052 | |
| | |
National Bank of Greece SA* (a) | | | 14,852 | | | | 84,772 | |
| | |
National Bank of Kuwait SAKP | | | 121,119 | | | | 343,148 | |
| | |
Nedbank Group Ltd. | | | 12,267 | | | | 131,243 | |
| | |
O-Bank Co. Ltd. | | | 47,000 | | | | 13,505 | |
| | |
OTP Bank Nyrt. | | | 5,875 | | | | 218,132 | |
| | |
Ping An Bank Co. Ltd., Class A | | | 45,300 | | | | 64,749 | |
| | |
Piraeus Financial Holdings SA* | | | 15,328 | | | | 45,203 | |
| | |
Postal Savings Bank of China Co. Ltd., Class A | | | 65,800 | | | | 41,091 | |
| | |
Postal Savings Bank of China Co. Ltd., Class H(a) (b) | | | 188,000 | | | | 85,776 | |
| | |
Public Bank Bhd. | | | 418,300 | | | | 365,228 | |
| | |
Punjab National Bank | | | 59,188 | | | | 51,895 | |
| | |
Qatar International Islamic Bank QSC | | | 14,288 | | | | 36,299 | |
| | |
Qatar Islamic Bank SAQ | | | 25,331 | | | | 121,055 | |
| | |
Qatar National Bank QPSC | | | 121,307 | | | | 496,089 | |
| | |
Qingdao Rural Commercial Bank Corp., Class A* | | | 18,800 | | | | 6,962 | |
| | |
RBL Bank Ltd.(b) | | | 171,080 | | | | 452,980 | |
| | |
Regional SAB de CV | | | 4,900 | | | | 37,226 | |
| | |
RHB Bank Bhd. | | | 42,300 | | | | 49,540 | |
| | |
Riyad Bank | | | 36,942 | | | | 261,438 | |
| | |
Saudi Awwal Bank | | | 6,674 | | | | 59,507 | |
| | |
Saudi Investment Bank (The) | | | 13,489 | | | | 52,854 | |
| | |
Saudi National Bank (The) | | | 80,088 | | | | 716,215 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 225 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Sberbank of Russia PJSC‡ | | | 369,050 | | | $ | — | |
| | |
Sberbank of Russia PJSC (Preference)‡ | | | 39,708 | | | | — | |
| | |
SCB X PCL, NVDR | | | 23,400 | | | | 64,127 | |
| | |
Security Bank Corp. | | | 122,200 | | | | 165,834 | |
| | |
Shanghai Commercial & Savings Bank Ltd. (The) | | | 74,888 | | | | 99,050 | |
| | |
Shanghai Pudong Development Bank Co. Ltd., Class A | | | 70,500 | | | | 65,702 | |
| | |
Shanghai Rural Commercial Bank Co. Ltd., Class A | | | 38,400 | | | | 31,274 | |
| | |
Sharjah Islamic Bank | | | 516,765 | | | | 329,221 | |
| | |
Shinhan Financial Group Co. Ltd. | | | 13,724 | | | | 353,122 | |
| | |
SinoPac Financial Holdings Co. Ltd. | | | 358,191 | | | | 197,124 | |
| | |
Standard Bank Group Ltd. | | | 35,709 | | | | 348,368 | |
| | |
State Bank of India | | | 26,602 | | | | 180,699 | |
| | |
Taichung Commercial Bank Co. Ltd. | | | 54,149 | | | | 24,541 | |
| | |
Taishin Financial Holding Co. Ltd. | | | 356,238 | | | | 189,459 | |
| | |
Taiwan Business Bank | | | 92,269 | | | | 36,270 | |
| | |
Taiwan Cooperative Financial Holding Co. Ltd. | | | 148,350 | | | | 115,030 | |
| | |
Thanachart Capital PCL, NVDR | | | 19,300 | | | | 26,312 | |
| | |
Tisco Financial Group PCL, NVDR | | | 9,300 | | | | 24,904 | |
| | |
TMBThanachart Bank PCL, NVDR | | | 1,236,200 | | | | 57,438 | |
| | |
Turkiye Garanti Bankasi A/S | | | 13,849 | | | | 23,006 | |
| | |
Turkiye Halk Bankasi A/S* | | | 15,557 | | | | 7,236 | |
| | |
Turkiye Is Bankasi A/S, Class C | | | 94,423 | | | | 70,018 | |
| | |
Union Bank of India Ltd. | | | 42,770 | | | | 52,192 | |
| | |
Union Bank of Taiwan | | | 52,500 | | | | 21,366 | |
| | |
Union Bank of the Philippines | | | 7,980 | | | | 8,368 | |
| | |
VTB Bank PJSC* ‡ | | | 136,511,531 | | | | — | |
| | |
Warba Bank KSCP | | | 13,740 | | | | 7,635 | |
| | |
Woori Financial Group, Inc. | | | 18,573 | | | | 163,651 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Yapi ve Kredi Bankasi A/S | | | 76,200 | | | $ | 46,432 | |
| | |
Yes Bank Ltd.* | | | 228,275 | | | | 43,731 | |
| | | | | | | 29,920,923 | |
|
Beverages – 1.1% | |
| | |
Ambev SA | | | 65,800 | | | | 167,795 | |
| | |
Anadolu Efes Biracilik ve Malt Sanayii A/S, Class B | | | 5,350 | | | | 18,881 | |
| | |
Anhui Gujing Distillery Co. Ltd., Class A | | | 700 | | | | 26,689 | |
| | |
Anhui Gujing Distillery Co. Ltd., Class B | | | 2,200 | | | | 34,302 | |
| | |
Arca Continental SAB de CV | | | 6,572 | | | | 58,854 | |
| | |
Becle SAB de CV(a) | | | 4,700 | | | | 8,276 | |
| | |
Carabao Group PCL, NVDR | | | 4,600 | | | | 8,639 | |
| | |
Carlsberg Brewery Malaysia Bhd. | | | 4,900 | | | | 20,466 | |
| | |
China Foods Ltd. | | | 282,000 | | | | 97,669 | |
| | |
China Resources Beer Holdings Co. Ltd. | | | 23,107 | | | | 122,259 | |
| | |
Chongqing Brewery Co. Ltd., Class A | | | 600 | | | | 6,436 | |
| | |
Cia Cervecerias Unidas SA | | | 2,156 | | | | 12,217 | |
| | |
Coca-Cola Femsa SAB de CV | | | 9,400 | | | | 71,225 | |
| | |
Coca-Cola Icecek A/S | | | 1,269 | | | | 16,497 | |
| | |
Embotelladora Andina SA (Preference), Class B | | | 5,243 | | | | 10,627 | |
| | |
Emperador, Inc. | | | 28,200 | | | | 10,338 | |
| | |
Fomento Economico Mexicano SAB de CV | | | 28,714 | | | | 324,565 | |
| | |
Fraser & Neave Holdings Bhd. | | | 3,700 | | | | 20,269 | |
| | |
Hebei Hengshui Laobaigan Liquor Co. Ltd., Class A | | | 2,300 | | | | 7,480 | |
| | |
Heineken Malaysia Bhd. | | | 3,800 | | | | 19,014 | |
| | |
Hite Jinro Co. Ltd. | | | 1,274 | | | | 20,046 | |
| | |
Jiangsu King’s Luck Brewery JSC Ltd., Class A | | | 2,300 | | | | 18,386 | |
| | |
Jiangsu Yanghe Brewery Joint-Stock Co. Ltd., Class A | | | 2,100 | | | | 35,038 | |
| | |
JiuGui Liquor Co. Ltd., Class A | | | 500 | | | | 5,225 | |
| | |
Kweichow Moutai Co. Ltd., Class A | | | 1,600 | | | | 368,310 | |
| | |
Lotte Chilsung Beverage Co. Ltd. | | | 47 | | | | 5,064 | |
See Accompanying Notes to the Financial Statements.
| | | | |
226 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Beverages – (continued) | |
| | |
Luzhou Laojiao Co. Ltd., Class A | | | 2,400 | | | $ | 70,382 | |
| | |
Nongfu Spring Co. Ltd., Class H(a) (c) | | | 28,800 | | | | 163,975 | |
| | |
Osotspa PCL, NVDR | | | 31,700 | | | | 20,726 | |
| | |
Radico Khaitan Ltd. | | | 3,384 | | | | 49,460 | |
| | |
Shanxi Xinghuacun Fen Wine Factory Co. Ltd., Class A | | | 1,960 | | | | 66,207 | |
| | |
Tsingtao Brewery Co. Ltd., Class A | | | 1,100 | | | | 12,562 | |
| | |
Tsingtao Brewery Co. Ltd., Class H | | | 10,000 | | | | 75,787 | |
| | |
United Breweries Ltd. | | | 1,379 | | | | 26,751 | |
| | |
United Spirits Ltd.* | | | 5,358 | | | | 66,426 | |
| | |
Varun Beverages Ltd. | | | 7,144 | | | | 77,979 | |
| | |
Vina Concha y Toro SA | | | 190,397 | | | | 211,237 | |
| | |
Wuliangye Yibin Co. Ltd., Class A | | | 4,700 | | | | 100,190 | |
| | |
ZJLD Group, Inc.* (b) | | | 9,800 | | | | 14,253 | |
| | | | | | | 2,470,502 | |
|
Biotechnology – 0.6% | |
| | |
3SBio, Inc.(b) | | | 47,000 | | | | 41,807 | |
| | |
ABLBio, Inc.* | | | 1,585 | | | | 18,672 | |
| | |
AIM Vaccine Co. Ltd.* | | | 4,200 | | | | 4,917 | |
| | |
Akeso, Inc.* (a) (b) | | | 7,000 | | | | 39,274 | |
| | |
Alteogen, Inc.* | | | 384 | | | | 17,742 | |
| | |
BeiGene Ltd.* (a) | | | 12,600 | | | | 182,448 | |
| | |
Beijing Wantai Biological Pharmacy Enterprise Co. Ltd., Class A | | | 1,421 | | | | 8,517 | |
| | |
Biocon Ltd. | | | 6,644 | | | | 17,528 | |
| | |
Bioneer Corp.* | | | 392 | | | | 9,201 | |
| | |
Blau Farmaceutica SA | | | 14,100 | | | | 42,498 | |
| | |
Bloomage Biotechnology Corp. Ltd., Class A | | | 611 | | | | 6,384 | |
| | |
CARsgen Therapeutics Holdings Ltd.* (b) | | | 24,500 | | | | 32,501 | |
| | |
Celltrion, Inc. | | | 1,700 | | | | 188,183 | |
| | |
Daan Gene Co. Ltd., Class A | | | 4,700 | | | | 6,255 | |
| | |
Ever Supreme Bio Technology Co. Ltd. | | | 2,480 | | | | 15,254 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Biotechnology – (continued) | |
| | |
GC Cell Corp. | | | 329 | | | $ | 7,028 | |
| | |
Genexine, Inc.* | | | 441 | | | | 2,570 | |
| | |
Green Cross Corp. | | | 163 | | | | 11,586 | |
| | |
Green Cross Holdings Corp. | | | 11,844 | | | | 118,743 | |
| | |
Hugel, Inc.* | | | 126 | | | | 13,248 | |
| | |
InnoCare Pharma Ltd.* (b) | | | 31,000 | | | | 24,484 | |
| | |
Innovent Biologics, Inc.* (a) (b) | | | 23,500 | | | | 138,304 | |
| | |
Keymed Biosciences, Inc.* (b) | | | 3,000 | | | | 22,314 | |
| | |
L&C Bio Co. Ltd. | | | 605 | | | | 12,677 | |
| | |
Medigen Vaccine Biologics Corp.* | | | 11,148 | | | | 23,922 | |
| | |
Medytox, Inc. | | | 48 | | | | 7,304 | |
| | |
Naturecell Co. Ltd.* | | | 1,833 | | | | 9,501 | |
| | |
OBI Pharma, Inc.* | | | 10,354 | | | | 25,729 | |
| | |
PharmaEngine, Inc. | | | 6,816 | | | | 23,851 | |
| | |
PharmaEssentia Corp.* | | | 4,000 | | | | 39,772 | |
| | |
PharmaResearch Co. Ltd. | | | 349 | | | | 30,079 | |
| | |
Pharmicell Co. Ltd.* | | | 980 | | | | 4,484 | |
| | |
Remegen Co. Ltd., Class A* | | | 245 | | | | 2,176 | |
| | |
Seegene, Inc. | | | 637 | | | | 8,999 | |
| | |
Shanghai Junshi Biosciences Co. Ltd., Class A* | | | 1,113 | | | | 6,978 | |
| | |
Shanghai Junshi Biosciences Co. Ltd., Class H* (b) | | | 2,200 | | | | 6,101 | |
| | |
Shanghai RAAS Blood Products Co. Ltd., Class A | | | 9,400 | | | | 8,966 | |
| | |
SillaJen, Inc.* | | | 4,263 | | | | 13,715 | |
| | |
SK Bioscience Co. Ltd.* | | | 468 | | | | 20,999 | |
| | |
TaiMed Biologics, Inc.* | | | 6,192 | | | | 16,513 | |
| | |
Vaxcell-Bio Therapeutics Co. Ltd.* | | | 371 | | | | 6,208 | |
| | |
Voronoi, Inc.* | | | 384 | | | | 9,511 | |
| | |
Zai Lab Ltd.* | | | 9,800 | | | | 24,849 | |
| | | | | | | 1,271,792 | |
|
Broadline Retail – 3.4% | |
| | |
Alibaba Group Holding Ltd.* | | | 420,400 | | | | 4,300,925 | |
| | |
Bukalapak.com PT Tbk.* | | | 700,000 | | | | 9,254 | |
| | |
Central Retail Corp. PCL, NVDR | | | 51,475 | | | | 52,631 | |
| | |
Easyhome New Retail Group Co. Ltd., Class A | | | 14,400 | | | | 6,887 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 227 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Broadline Retail – (continued) | |
| | |
El Puerto de Liverpool SAB de CV, Class C1 | | | 6,185 | | | $ | 31,403 | |
| | |
Falabella SA* | | | 20,645 | | | | 41,904 | |
| | |
Far Eastern Department Stores Ltd. | | | 49,000 | | | | 36,182 | |
| | |
Global Digital Niaga Tbk. PT* | | | 387,100 | | | | 11,063 | |
| | |
GoTo Gojek Tokopedia Tbk. PT, Class A* | | | 13,789,800 | | | | 52,086 | |
| | |
Hyundai Department Store Co. Ltd. | | | 224 | | | | 8,857 | |
| | |
Hyundai Home Shopping Network Corp. | | | 1,956 | | | | 60,104 | |
| | |
JD.com, Inc., Class A | | | 65,800 | | | | 839,256 | |
| | |
Lotte Shopping Co. Ltd. | | | 245 | | | | 13,080 | |
| | |
Magazine Luiza SA* | | | 52,300 | | | | 13,793 | |
| | |
MINISO Group Holding Ltd., ADR | | | 3,431 | | | | 86,839 | |
| | |
Mitra Adiperkasa Tbk. PT | | | 171,500 | | | | 18,732 | |
| | |
momo.com, Inc. | | | 1,716 | | | | 28,199 | |
| | |
Naspers Ltd., Class N* | | | 2,961 | | | | 459,517 | |
| | |
PDD Holdings, Inc., ADR* (a) | | | 10,716 | | | | 1,086,817 | |
| | |
Shinsegae, Inc. | | | 212 | | | | 26,497 | |
| | |
Shoppers Stop Ltd.* | | | 1,421 | | | | 10,925 | |
| | |
Vipshop Holdings Ltd., ADR* | | | 7,943 | | | | 113,267 | |
| | |
Woolworths Holdings Ltd. | | | 12,502 | | | | 46,275 | |
| | |
Zhejiang China Commodities City Group Co. Ltd., Class A | | | 5,500 | | | | 5,848 | |
| | | | | | | 7,360,341 | |
|
Building Products – 0.3% | |
| | |
Astral Ltd. | | | 2,214 | | | | 49,215 | |
| | |
Beijing New Building Materials plc, Class A | | | 5,300 | | | | 17,736 | |
| | |
Blue Star Ltd. | | | 5,405 | | | | 57,430 | |
| | |
Cera Sanitaryware Ltd. | | | 245 | | | | 24,963 | |
| | |
China Lesso Group Holdings Ltd. | | | 33,000 | | | | 17,713 | |
| | |
Dynasty Ceramic PCL, NVDR | | | 215,500 | | | | 9,533 | |
| | |
Kajaria Ceramics Ltd. | | | 1,150 | | | | 17,422 | |
| | |
KCC Glass Corp. | | | 4,277 | | | | 128,258 | |
| | |
Kyung Dong Navien Co. Ltd. | | | 2,585 | | | | 91,682 | |
| | |
Prince Pipes & Fittings Ltd.* | | | 1,960 | | | | 14,837 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Building Products – (continued) | |
| | |
Qua Granite Hayal* | | | 19,943 | | | $ | 3,891 | |
| | |
Ras Al Khaimah Ceramics | | | 165,111 | | | | 109,235 | |
| | |
Saudi Ceramic Co. | | | 935 | | | | 5,932 | |
| | |
Taiwan Glass Industry Corp.* | | | 37,152 | | | | 20,904 | |
| | |
Xinyi Glass Holdings Ltd.(a) | | | 59,975 | | | | 68,908 | |
| | |
Zhuzhou Kibing Group Co. Ltd., Class A | | | 5,300 | | | | 5,779 | |
| | | | | | | 643,438 | |
|
Capital Markets – 2.1% | |
| | |
360 ONE WAM Ltd. | | | 7,712 | | | | 48,638 | |
| | |
Angel One Ltd. | | | 1,551 | | | | 48,098 | |
| | |
B3 SA - Brasil Bolsa Balcao | | | 89,300 | | | | 196,556 | |
| | |
Banco BTG Pactual SA | | | 18,800 | | | | 110,347 | |
| | |
Bangkok Commercial Asset Management PCL, NVDR | | | 26,500 | | | | 6,599 | |
| | |
Beyond Securities PCL, NVDR* | | | 37,500 | | | | 4,278 | |
| | |
Bolsa Mexicana de Valores SAB de CV | | | 19,200 | | | | 29,896 | |
| | |
Boursa Kuwait Securities Co. KPSC | | | 5,096 | | | | 28,530 | |
| | |
Bursa Malaysia Bhd. | | | 8,000 | | | | 11,401 | |
| | |
Caitong Securities Co. Ltd., Class A | | | 12,220 | | | | 13,258 | |
| | |
Capital Securities Corp. | | | 49,000 | | | | 21,528 | |
| | |
Changjiang Securities Co. Ltd., Class A | | | 14,100 | | | | 10,963 | |
| | |
China Cinda Asset Management Co. Ltd., Class H | | | 3,525,000 | | | | 342,382 | |
| | |
China Everbright Ltd. | | | 346,000 | | | | 205,621 | |
| | |
China Galaxy Securities Co. Ltd., Class A | | | 5,200 | | | | 8,619 | |
| | |
China Galaxy Securities Co. Ltd., Class H | | | 115,500 | | | | 59,044 | |
| | |
China Huarong Asset Management Co. Ltd., Class H* (a) (b) | | | 423,000 | | | | 18,921 | |
| | |
China International Capital Corp. Ltd., Class A | | | 1,600 | | | | 8,055 | |
| | |
China International Capital Corp. Ltd., Class H(b) | | | 19,600 | | | | 31,211 | |
| | |
China Merchants Securities Co. Ltd., Class A | | | 21,220 | | | | 41,001 | |
See Accompanying Notes to the Financial Statements.
| | | | |
228 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
China Merchants Securities Co. Ltd., Class H(b) | | | 16,600 | | | $ | 13,726 | |
| | |
Chinalin Securities Co. Ltd., Class A | | | 4,900 | | | | 9,354 | |
| | |
CITIC Securities Co. Ltd., Class A | | | 28,200 | | | | 83,659 | |
| | |
CITIC Securities Co. Ltd., Class H | | | 47,000 | | | | 91,422 | |
| | |
Coronation Fund Managers Ltd.(a) | | | 105,186 | | | | 169,504 | |
| | |
CRISIL Ltd. | | | 342 | | | | 16,829 | |
| | |
CSC Financial Co. Ltd., Class A | | | 7,500 | | | | 24,781 | |
| | |
CSC Financial Co. Ltd., Class H(b) | | | 352,500 | | | | 317,154 | |
| | |
Daishin Securities Co. Ltd. | | | 212 | | | | 2,198 | |
| | |
Daishin Securities Co. Ltd. (Preference) | | | 530 | | | | 5,219 | |
| | |
Daou Data Corp. | | | 4,700 | | | | 39,777 | |
| | |
Daou Technology, Inc. | | | 10,199 | | | | 123,093 | |
| | |
Dubai Financial Market PJSC | | | 33,628 | | | | 11,994 | |
| | |
EFG Holding S.A.E.* | | | 444,327 | | | | 239,944 | |
| | |
Egypt Kuwait Holding Co. SAE | | | 10,976 | | | | 10,197 | |
| | |
Everbright Securities Co. Ltd., Class A | | | 4,700 | | | | 10,571 | |
| | |
GF Securities Co. Ltd., Class A | | | 14,100 | | | | 28,593 | |
| | |
GF Securities Co. Ltd., Class H | | | 28,200 | | | | 36,689 | |
| | |
Guangzhou Yuexiu Capital Holdings Group Co. Ltd., Class A | | | 11,664 | | | | 10,456 | |
| | |
Guosen Securities Co. Ltd., Class A | | | 24,000 | | | | 31,516 | |
| | |
Guotai Junan Securities Co. Ltd., Class A | | | 18,800 | | | | 37,944 | |
| | |
Guotai Junan Securities Co. Ltd., Class H(b) | | | 21,200 | | | | 23,653 | |
| | |
Haitong Securities Co. Ltd., Class A | | | 18,800 | | | | 25,099 | |
| | |
Haitong Securities Co. Ltd., Class H | | | 75,200 | | | | 43,152 | |
| | |
Hanwha Investment & Securities Co. Ltd.* | | | 40,749 | | | | 69,245 | |
| | |
HDFC Asset Management Co. Ltd.(b) | | | 1,150 | | | | 37,763 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
Huatai Securities Co. Ltd., Class A | | | 14,400 | | | $ | 31,543 | |
| | |
Huatai Securities Co. Ltd., Class H(b) | | | 47,000 | | | | 61,509 | |
| | |
IBF Financial Holdings Co. Ltd.* | | | 56,381 | | | | 19,990 | |
| | |
ICICI Securities Ltd.(b) | | | 1,880 | | | | 14,431 | |
| | |
IDFC Ltd. | | | 51,747 | | | | 71,164 | |
| | |
Indian Energy Exchange Ltd.(b) | | | 16,732 | | | | 25,291 | |
| | |
Industrial Securities Co. Ltd., Class A | | | 34,450 | | | | 29,375 | |
| | |
Investec Ltd. | | | 4,353 | | | | 23,677 | |
| | |
Is Yatirim Menkul Degerler A/S | | | 193,076 | | | | 289,483 | |
| | |
JM Financial Ltd. | | | 165,017 | | | | 162,027 | |
| | |
JSE Ltd. | | | 6,027 | | | | 28,452 | |
| | |
KIWOOM Securities Co. Ltd. | | | 392 | | | | 23,365 | |
| | |
Korea Investment Holdings Co. Ltd. | | | 720 | | | | 26,816 | |
| | |
Minmetals Capital Co. Ltd., Class A | | | 14,400 | | | | 9,996 | |
| | |
Mirae Asset Securities Co. Ltd. | | | 7,176 | | | | 35,068 | |
| | |
Mirae Asset Securities Co. Ltd. (Preference) | | | 5,733 | | | | 14,857 | |
| | |
Moscow Exchange MICEX-RTS PJSC‡ | | | 29,911 | | | | — | |
| | |
Motilal Oswal Financial Services Ltd. | | | 13,348 | | | | 166,420 | |
| | |
Multi Commodity Exchange of India Ltd. | | | 583 | | | | 16,322 | |
| | |
NH Investment & Securities Co. Ltd. | | | 5,356 | | | | 38,389 | |
| | |
Ninety One Ltd. | | | 12,691 | | | | 24,655 | |
| | |
Nippon Life India Asset Management Ltd.(b) | | | 7,791 | | | | 36,630 | |
| | |
Noah Holdings Ltd., ADR | | | 20,492 | | | | 234,428 | |
| | |
Norte Grande SA | | | 1,265,334 | | | | 10,493 | |
| | |
Orient Securities Co. Ltd., Class A | | | 12,032 | | | | 14,255 | |
| | |
Orient Securities Co. Ltd., Class H(b) | | | 20,400 | | | | 9,490 | |
| | |
Oyak Yatirim Menkul Degerler A/S* | | | 36,237 | | | | 61,196 | |
| | |
Pacific Strategic Financial Tbk. PT* | | | 448,500 | | | | 30,775 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 229 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
Pihsiang Machinery Manufacturing Co. Ltd.* ‡ | | | 5,000 | | | $ | — | |
| | |
President Securities Corp. | | | 15,000 | | | | 8,047 | |
| | |
PSG Financial Services Ltd. | | | 57,669 | | | | 44,482 | |
| | |
Reinet Investments SCA | | | 1,152 | | | | 23,797 | |
| | |
Samsung Securities Co. Ltd. | | | 1,927 | | | | 50,367 | |
| | |
Saratoga Investama Sedaya Tbk. PT | | | 27,500 | | | | 2,476 | |
| | |
Saudi Tadawul Group Holding Co. | | | 763 | | | | 33,802 | |
| | |
SDIC Capital Co. Ltd., Class A | | | 19,200 | | | | 17,919 | |
| | |
Shenwan Hongyuan Group Co. Ltd., Class A | | | 47,900 | | | | 28,734 | |
| | |
Shenwan Hongyuan Group Co. Ltd., Class H(b) | | | 78,400 | | | | 14,528 | |
| | |
Shinyoung Securities Co. Ltd. | | | 1,551 | | | | 64,312 | |
| | |
Sociedad de Inversiones Oro Blanco SA | | | 1,353,420 | | | | 8,721 | |
| | |
SPIC Industry-Finance Holdings Co. Ltd., Class A | | | 10,000 | | | | 5,684 | |
| | |
Tata Investment Corp. Ltd. | | | 517 | | | | 19,285 | |
| | |
UTI Asset Management Co. Ltd. | | | 3,250 | | | | 29,366 | |
| | |
Western Securities Co. Ltd., Class A | | | 10,000 | | | | 9,101 | |
| | |
Yuanta Securities Korea Co. Ltd. | | | 36,331 | | | | 63,621 | |
| | |
Zheshang Securities Co. Ltd., Class A | | | 4,700 | | | | 6,467 | |
| | | | | | | 4,699,284 | |
|
Chemicals – 3.9% | |
| | |
Aarti Industries Ltd. | | | 2,880 | | | | 15,720 | |
| | |
Abou Kir Fertilizers & Chemical Industries | | | 9,849 | | | | 24,523 | |
| | |
Advanced Nano Products Co. Ltd. | | | 147 | | | | 12,985 | |
| | |
Advanced Petrochemical Co. | | | 2,025 | | | | 20,133 | |
| | |
AECI Ltd. | | | 43,146 | | | | 254,109 | |
| | |
Akzo Nobel India Ltd. | | | 539 | | | | 15,642 | |
| | |
Alkyl Amines Chemicals | | | 220 | | | | 5,662 | |
| | |
Allied Supreme Corp. | | | 2,352 | | | | 22,588 | |
| | |
Alpek SAB de CV, Class A(a) | | | 24,500 | | | | 14,168 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – (continued) | |
| | |
Alujain Corp.* | | | 13,677 | | | $ | 137,805 | |
| | |
Anupam Rasayan India Ltd. | | | 980 | | | | 10,400 | |
| | |
Archean Chemical Industries Ltd. | | | 2,352 | | | | 16,180 | |
| | |
Asia Polymer Corp. | | | 141,000 | | | | 102,376 | |
| | |
Asian Paints Ltd. | | | 7,121 | | | | 256,218 | |
| | |
Atul Ltd. | | | 259 | | | | 19,417 | |
| | |
Avia Avian Tbk. PT | | | 277,300 | | | | 8,728 | |
| | |
Balaji Amines Ltd. | | | 350 | | | | 8,599 | |
| | |
Barito Pacific Tbk. PT | | | 466,498 | | | | 33,038 | |
| | |
BASF India Ltd. | | | 400 | | | | 12,126 | |
| | |
Batu Kawan Bhd. | | | 6,300 | | | | 27,107 | |
| | |
Bayer CropScience Ltd. | | | 141 | | | | 8,333 | |
| | |
Berger Paints India Ltd. | | | 5,901 | | | | 39,591 | |
| | |
Boubyan Petrochemicals Co. KSCP | | | 7,344 | | | | 14,543 | |
| | |
Braskem SA (Preference), Class A* | | | 4,900 | | | | 15,614 | |
| | |
Carborundum Universal Ltd. | | | 2,499 | | | | 32,174 | |
| | |
Castrol India Ltd. | | | 18,650 | | | | 30,498 | |
| | |
Chambal Fertilisers and Chemicals Ltd. | | | 65,518 | | | | 227,066 | |
| | |
Chandra Asri Petrochemical Tbk. PT | | | 91,200 | | | | 17,109 | |
| | |
Chemplast Sanmar Ltd.* | | | 2,585 | | | | 13,790 | |
| | |
Chengxin Lithium Group Co. Ltd., Class A | | | 4,900 | | | | 15,728 | |
| | |
China General Plastics Corp. | | | 141,000 | | | | 92,812 | |
| | |
China Hainan Rubber Industry Group Co. Ltd., Class A* | | | 9,600 | | | | 5,877 | |
| | |
China Lumena New Materials Corp.* ‡ | | | 22,200 | | | | — | |
| | |
China Man-Made Fiber Corp.* | | | 50,000 | | | | 12,224 | |
| | |
China Petrochemical Development Corp.* | | | 107,520 | | | | 33,647 | |
| | |
China Risun Group Ltd.(b) | | | 49,000 | | | | 20,039 | |
| | |
Chunbo Co. Ltd. | | | 47 | | | | 3,438 | |
| | |
CNNC Hua Yuan Titanium Dioxide Co. Ltd., Class A | | | 7,975 | | | | 5,187 | |
| | |
Coromandel International Ltd. | | | 1,898 | | | | 23,777 | |
| | |
Cosmochemical Co. Ltd.* | | | 583 | | | | 13,490 | |
| | |
D&L Industries, Inc. | | | 4,900 | | | | 553 | |
| | |
DCM Shriram Ltd. | | | 2,303 | | | | 25,628 | |
See Accompanying Notes to the Financial Statements.
| | | | |
230 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Deepak Fertilisers & Petrochemicals Corp. Ltd. | | | 26,367 | | | $ | 203,456 | |
| | |
Deepak Nitrite Ltd. | | | 1,105 | | | | 26,368 | |
| | |
DL Holdings Co. Ltd. | | | 397 | | | | 12,493 | |
| | |
Dongjin Semichem Co. Ltd. | | | 725 | | | | 16,078 | |
| | |
Dongyue Group Ltd. | | | 42,000 | | | | 33,441 | |
| | |
Eastern Polymer Group PCL, NVDR | | | 63,600 | | | | 11,679 | |
| | |
Ecopro Co. Ltd. | | | 282 | | | | 129,458 | |
| | |
EID Parry India Ltd. | | | 3,871 | | | | 21,459 | |
| | |
Enchem Co. Ltd.* | | | 235 | | | | 8,996 | |
| | |
Eternal Materials Co. Ltd. | | | 27,550 | | | | 23,613 | |
| | |
Fertiglobe plc | | | 43,901 | | | | 38,367 | |
| | |
Fine Organic Industries Ltd. | | | 343 | | | | 18,208 | |
| | |
Finolex Industries Ltd. | | | 9,600 | | | | 22,144 | |
| | |
Foosung Co. Ltd. | | | 1,768 | | | | 13,039 | |
| | |
Formosa Chemicals & Fibre Corp. | | | 66,000 | | | | 123,922 | |
| | |
Formosa Plastics Corp. | | | 81,592 | | | | 193,698 | |
| | |
Fufeng Group Ltd.(a) | | | 517,000 | | | | 268,259 | |
| | |
Galaxy Surfactants Ltd.(b) | | | 250 | | | | 8,197 | |
| | |
Ganfeng Lithium Group Co. Ltd., Class A | | | 4,080 | | | | 24,687 | |
| | |
Ganfeng Lithium Group Co. Ltd., Class H(b) | | | 9,480 | | | | 33,984 | |
| | |
Grand Pacific Petrochemical | | | 47,000 | | | | 22,895 | |
| | |
Guangzhou Tinci Materials Technology Co. Ltd., Class A | | | 5,000 | | | | 19,001 | |
| | |
Gubre Fabrikalari TAS* | | | 833 | | | | 9,660 | |
| | |
Gujarat Fluorochemicals Ltd. | | | 715 | | | | 23,819 | |
| | |
Gujarat Narmada Valley Fertilizers & Chemicals Ltd. | | | 36,707 | | | | 304,846 | |
| | |
Han Kuk Carbon Co. Ltd. | | | 1,470 | | | | 12,397 | |
| | |
Hangzhou Oxygen Plant Group Co. Ltd., Class A | | | 2,400 | | | | 10,829 | |
| | |
Hansol Chemical Co. Ltd. | | | 141 | | | | 15,681 | |
| | |
Hanwha Solutions Corp.* | | | 1,786 | | | | 37,887 | |
| | |
Hektas Ticaret TAS* | | | 16,074 | | | | 12,453 | |
| | |
Hengli Petrochemical Co. Ltd., Class A* | | | 14,100 | | | | 28,207 | |
| | |
Hengyi Petrochemical Co. Ltd., Class A* | | | 14,100 | | | | 13,853 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – (continued) | |
| | |
Hoshine Silicon Industry Co. Ltd., Class A | | | 1,900 | | | $ | 14,864 | |
| | |
Huabao International Holdings Ltd.(a) | | | 17,000 | | | | 5,714 | |
| | |
Huafon Chemical Co. Ltd., Class A | | | 14,400 | | | | 14,266 | |
| | |
Hunan Changyuan Lico Co. Ltd., Class A | | | 784 | | | | 913 | |
| | |
Hyosung Advanced Materials Corp. | | | 55 | | | | 14,539 | |
| | |
Hyosung TNC Corp. | | | 98 | | | | 25,905 | |
| | |
Indorama Ventures PCL, NVDR | | | 43,200 | | | | 28,485 | |
| | |
Inner Mongolia Junzheng Energy & Chemical Industry Group Co. Ltd., Class A | | | 23,500 | | | | 12,845 | |
| | |
Inner Mongolia Yuan Xing Energy Co. Ltd., Class A | | | 14,100 | | | | 13,121 | |
| | |
International CSRC Investment Holdings Co. | | | 43,008 | | | | 25,326 | |
| | |
ISU Chemical Co. Ltd. | | | 641 | | | | 5,620 | |
| | |
Jiangsu Eastern Shenghong Co. Ltd., Class A | | | 11,000 | | | | 15,993 | |
| | |
Jinan Acetate Chemical Co. Ltd. | | | 714 | | | | 21,309 | |
| | |
Jubilant Ingrevia Ltd. | | | 2,701 | | | | 13,619 | |
| | |
Kansai Nerolac Paints Ltd. | | | 3,294 | | | | 12,466 | |
| | |
KCC Corp. | | | 106 | | | | 18,641 | |
| | |
Kimteks Poliuretan Sanayi ve Ticaret A/S | | | 31,960 | | | | 81,897 | |
| | |
Kolon Industries, Inc. | | | 674 | | | | 21,684 | |
| | |
Korea Petrochemical Ind Co. Ltd. | | | 1,504 | | | | 177,177 | |
| | |
KuibyshevAzot PJSC‡ | | | 9,900 | | | | — | |
| | |
Kum Yang Co. Ltd.* | | | 553 | | | | 35,951 | |
| | |
Kumho Petrochemical Co. Ltd. | | | 423 | | | | 39,683 | |
| | |
Lake Materials Co. Ltd.* | | | 1,715 | | | | 14,324 | |
| | |
Laxmi Organic Industries Ltd.(b) | | | 2,107 | | | | 6,476 | |
| | |
LB Group Co. Ltd., Class A | | | 4,700 | | | | 11,965 | |
| | |
Levima Advanced Materials Corp., Class A | | | 4,800 | | | | 12,475 | |
| | |
LG Chem Ltd. | | | 705 | | | | 229,684 | |
| | |
LG Chem Ltd. (Preference) | | | 167 | | | | 34,685 | |
| | |
Linde India Ltd. | | | 282 | | | | 20,305 | |
| | |
Lotte Chemical Corp. | | | 562 | | | | 60,921 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 231 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Lotte Chemical Titan Holding Bhd.(b) | | | 235,000 | | | $ | 55,735 | |
| | |
LOTTE Fine Chemical Co. Ltd. | | | 397 | | | | 16,461 | |
| | |
Luxi Chemical Group Co. Ltd., Class A | | | 6,500 | | | | 10,081 | |
| | |
Mesaieed Petrochemical Holding Co. | | | 68,381 | | | | 29,862 | |
| | |
Miwon Commercial Co. Ltd. | | | 125 | | | | 15,262 | |
| | |
MNTech Co. Ltd. | | | 833 | | | | 9,369 | |
| | |
Nan Pao Resins Chemical Co. Ltd. | | | 20,488 | | | | 125,701 | |
| | |
Nan Ya Plastics Corp. | | | 94,000 | | | | 179,393 | |
| | |
National Industrialization Co.* | | | 5,584 | | | | 17,296 | |
| | |
Navin Fluorine International Ltd. | | | 645 | | | | 26,636 | |
| | |
Ningxia Baofeng Energy Group Co. Ltd., Class A | | | 10,600 | | | | 20,887 | |
| | |
Nizhnekamskneftekhim PJSC‡ | | | 28,600 | | | | — | |
| | |
Nizhnekamskneftekhim PJSC (Preference)‡ | | | 26,400 | | | | — | |
| | |
OCI Holdings Co. Ltd. | | | 414 | | | | 29,827 | |
| | |
Omnia Holdings Ltd. | | | 68,996 | | | | 212,984 | |
| | |
Orbia Advance Corp. SAB de CV | | | 28,733 | | | | 46,490 | |
| | |
Organichesky Sintez PJSC‡ | | | 11,550 | | | | — | |
| | |
Oriental Union Chemical Corp. | | | 38,000 | | | | 21,323 | |
| | |
Petkim Petrokimya Holding A/S* | | | 38,400 | | | | 26,710 | |
| | |
Petronas Chemicals Group Bhd. | | | 84,600 | | | | 130,331 | |
| | |
PhosAgro PJSC‡ | | | 1,540 | | | | — | |
| | |
PI Advanced Materials Co. Ltd. | | | 520 | | | | 9,433 | |
| | |
PI Industries Ltd. | | | 1,189 | | | | 48,573 | |
| | |
Pidilite Industries Ltd. | | | 2,303 | | | | 67,990 | |
| | |
PTT Global Chemical PCL, NVDR | | | 46,900 | | | | 45,018 | |
| | |
Qinghai Salt Lake Industry Co. Ltd., Class A* | | | 18,800 | | | | 43,493 | |
| | |
Rongsheng Petrochemical Co. Ltd., Class A | | | 23,500 | | | | 36,576 | |
| | |
SABIC Agri-Nutrients Co. | | | 3,749 | | | | 133,707 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Chemicals – (continued) | |
| | |
Sahara International Petrochemical Co. | | | 9,679 | | | $ | 83,204 | |
| | |
Sasa Polyester Sanayi A/S* | | | 15,664 | | | | 23,674 | |
| | |
Sasol Ltd. | | | 15,181 | | | | 191,256 | |
| | |
Satellite Chemical Co. Ltd., Class A* | | | 4,662 | | | | 10,365 | |
| | |
Saudi Aramco Base Oil Co. | | | 784 | | | | 26,958 | |
| | |
Saudi Basic Industries Corp. | | | 13,536 | | | | 277,821 | |
| | |
Saudi Industrial Investment Group | | | 6,214 | | | | 39,686 | |
| | |
Saudi Kayan Petrochemical Co.* | | | 11,562 | | | | 32,606 | |
| | |
Scientex Bhd. | | | 34,300 | | | | 26,277 | |
| | |
Shandong Hualu Hengsheng Chemical Co. Ltd., Class A | | | 6,110 | | | | 26,859 | |
| | |
Shanghai Chlor-Alkali Chemical Co. Ltd., Class B | | | 164,500 | | | | 72,873 | |
| | |
Shanghai Putailai New Energy Technology Co. Ltd., Class A | | | 4,060 | | | | 13,870 | |
| | |
Shinkong Synthetic Fibers Corp. | | | 49,000 | | | | 22,736 | |
| | |
Sichuan Hebang Biotechnology Co. Ltd., Class A | | | 37,600 | | | | 12,228 | |
| | |
Sichuan Yahua Industrial Group Co. Ltd., Class A | | | 3,600 | | | | 6,926 | |
| | |
Sinofert Holdings Ltd. | | | 672,000 | | | | 76,436 | |
| | |
Sinoma Science & Technology Co. Ltd., Class A | | | 4,700 | | | | 11,104 | |
| | |
Sinon Corp. | | | 141,000 | | | | 158,671 | |
| | |
Sinopec Shanghai Petrochemical Co. Ltd., Class H* | | | 98,000 | | | | 13,151 | |
| | |
SK Chemicals Co. Ltd. | | | 196 | | | | 8,185 | |
| | |
SK IE Technology Co. Ltd.* (b) | | | 349 | | | | 15,324 | |
| | |
SKC Co. Ltd. | | | 294 | | | | 17,132 | |
| | |
Solar Applied Materials Technology Corp. | | | 24,096 | | | | 29,047 | |
| | |
Solar Industries India Ltd. | | | 405 | | | | 26,756 | |
| | |
Soulbrain Co. Ltd. | | | 47 | | | | 8,074 | |
| | |
Soulbrain Holdings Co. Ltd. | | | 1,833 | | | | 44,246 | |
| | |
SRF Ltd. | | | 2,484 | | | | 65,496 | |
| | |
Sumitomo Chemical India Ltd. | | | 2,585 | | | | 11,589 | |
| | |
Supreme Industries Ltd. | | | 1,156 | | | | 60,109 | |
| | |
Supreme Petrochem Ltd. | | | 3,456 | | | | 23,785 | |
See Accompanying Notes to the Financial Statements.
| | | | |
232 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Surya Esa Perkasa Tbk. PT | | | 4,347,500 | | | $ | 164,212 | |
| | |
Taekwang Industrial Co. Ltd. | | | 94 | | | | 40,230 | |
| | |
Taiwan Fertilizer Co. Ltd. | | | 16,360 | | | | 29,911 | |
| | |
Tata Chemicals Ltd. | | | 2,679 | | | | 30,864 | |
| | |
Tianqi Lithium Corp., Class A | | | 5,400 | | | | 40,584 | |
| | |
Tianqi Lithium Corp., Class H(a) | | | 47,000 | | | | 253,483 | |
| | |
TKG Huchems Co. Ltd. | | | 7,755 | | | | 125,465 | |
| | |
Tongkun Group Co. Ltd., Class A* | | | 9,400 | | | | 18,548 | |
| | |
TSRC Corp. | | | 235,000 | | | | 165,916 | |
| | |
Unipar Carbocloro SA (Preference), Class B | | | 18,800 | | | | 265,131 | |
| | |
UPL Ltd. | | | 9,024 | | | | 58,582 | |
| | |
USI Corp. | | | 22,000 | | | | 13,057 | |
| | |
Vinati Organics Ltd. | | | 539 | | | | 11,198 | |
| | |
Wanhua Chemical Group Co. Ltd., Class A | | | 4,700 | | | | 57,031 | |
| | |
Xinjiang Zhongtai Chemical Co. Ltd., Class A | | | 10,600 | | | | 9,705 | |
| | |
Yanbu National Petrochemical Co. | | | 3,384 | | | | 34,141 | |
| | |
Yunnan Energy New Material Co. Ltd., Class A | | | 1,200 | | | | 10,986 | |
| | |
Yunnan Yuntianhua Co. Ltd., Class A | | | 4,700 | | | | 10,693 | |
| | |
Zangge Mining Co. Ltd., Class A | | | 4,700 | | | | 14,380 | |
| | |
Zhejiang Longsheng Group Co. Ltd., Class A | | | 9,600 | | | | 11,675 | |
| | |
Zhejiang Yongtai Technology Co. Ltd., Class A | | | 2,800 | | | | 4,855 | |
| | | | | | | 8,568,798 | |
|
Commercial Services & Supplies – 0.2% | |
| | |
Beijing GeoEnviron Engineering & Technology, Inc., Class A | | | 15,300 | | | | 16,433 | |
| | |
China Everbright Environment Group Ltd. | | | 98,000 | | | | 33,441 | |
| | |
Cleanaway Co. Ltd. | | | 5,000 | | | | 26,669 | |
| | |
Dynagreen Environmental Protection Group Co. Ltd., Class H(a) (b) | | | 159,000 | | | | 47,144 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Commercial Services & Supplies – (continued) | |
| | |
Ecopro HN Co. Ltd. | | | 376 | | | $ | 16,036 | |
| | |
Frontken Corp. Bhd. | | | 42,300 | | | | 28,232 | |
| | |
GPS Participacoes e Empreendimentos SA(c) | | | 14,100 | | | | 44,903 | |
| | |
Indian Railway Catering & Tourism Corp. Ltd. | | | 6,110 | | | | 48,827 | |
| | |
KEPCO Plant Service & Engineering Co. Ltd. | | | 100 | | | | 2,414 | |
| | |
PNB Holdings Corp.* ‡ | | | 46,815 | | | | 27,518 | |
| | |
S-1 Corp. | | | 347 | | | | 14,028 | |
| | |
Saudi Airlines Catering Co. | | | 1,774 | | | | 49,367 | |
| | |
Sungeel Hitech Co. Ltd.* | | | 98 | | | | 6,872 | |
| | |
Sunny Friend Environmental Technology Co. Ltd. | | | 622 | | | | 1,985 | |
| | |
Taiwan Secom Co. Ltd. | | | 3,165 | | | | 11,514 | |
| | | | | | | 375,383 | |
|
Communications Equipment – 0.5% | |
| | |
Accton Technology Corp. | | | 9,000 | | | | 138,323 | |
| | |
Advanced Ceramic X Corp. | | | 2,000 | | | | 13,134 | |
| | |
Arcadyan Technology Corp. | | | 69,856 | | | | 331,673 | |
| | |
BYD Electronic International Co. Ltd. | | | 11,000 | | | | 45,830 | |
| | |
Hengtong Optic-electric Co. Ltd., Class A | | | 4,700 | | | | 8,465 | |
| | |
Intelbras SA Industria de Telecomunicacao Eletronica Brasileira | | | 4,900 | | | | 18,607 | |
| | |
Intellian Technologies, Inc. | | | 254 | | | | 13,259 | |
| | |
KMW Co. Ltd.* | | | 563 | | | | 4,169 | |
| | |
Seojin System Co. Ltd.* | | | 10,528 | | | | 130,104 | |
| | |
Sercomm Corp. | | | 95,000 | | | | 329,505 | |
| | |
Sterlite Technologies Ltd. | | | 6,627 | | | | 11,103 | |
| | |
Tejas Networks Ltd.* (b) | | | 2,202 | | | | 22,667 | |
| | |
Tianjin 712 Communication & Broadcasting Co. Ltd., Class A | | | 900 | | | | 3,272 | |
| | |
Wistron NeWeb Corp. | | | 5,000 | | | | 19,655 | |
| | |
ZTE Corp., Class A | | | 4,800 | | | | 17,152 | |
| | |
ZTE Corp., Class H | | | 9,800 | | | | 21,768 | |
| | | | | | | 1,128,686 | |
|
Construction & Engineering – 1.4% | |
| | |
Acter Group Corp. Ltd. | | | 44,256 | | | | 244,919 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 233 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Construction & Engineering – (continued) | |
| | |
BES Engineering Corp. | | | 531,552 | | | $ | 191,742 | |
| | |
CH Karnchang PCL, NVDR | | | 4,900 | | | | 2,972 | |
| | |
China Conch Venture Holdings Ltd. | | | 47,000 | | | | 38,863 | |
| | |
China Energy Engineering Corp. Ltd., Class A | | | 80,000 | | | | 23,831 | |
| | |
China Energy Engineering Corp. Ltd., Class H(a) | | | 198,000 | | | | 21,509 | |
| | |
China Railway Group Ltd., Class A | | | 43,400 | | | | 35,880 | |
| | |
China Railway Group Ltd., Class H | | | 115,000 | | | | 54,233 | |
| | |
China Railway Hi-tech Industry Co. Ltd., Class A | | | 19,200 | | | | 21,094 | |
| | |
Continental Holdings Corp. | | | 188,000 | | | | 155,918 | |
| | |
CTCI Corp. | | | 21,456 | | | | 26,096 | |
| | |
Daewoo Engineering & Construction Co. Ltd.* | | | 3,901 | | | | 11,352 | |
| | |
DL E&C Co. Ltd. | | | 799 | | | | 20,263 | |
| | |
Enka Insaat ve Sanayi A/S | | | 51,174 | | | | 55,022 | |
| | |
Estithmar Holding QPSC* | | | 30,456 | | | | 16,897 | |
| | |
Gamuda Bhd. | | | 34,826 | | | | 33,916 | |
| | |
GEK Terna Holding Real Estate Construction SA | | | 1,470 | | | | 20,510 | |
| | |
GS Engineering & Construction Corp. | | | 2,450 | | | | 23,873 | |
| | |
Guangdong No. 2 Hydropower Engineering Co. Ltd., Class A | | | 4,900 | | | | 3,549 | |
| | |
HDC Hyundai Development Co-Engineering & Construction, Class E | | | 15,322 | | | | 131,942 | |
| | |
Hydro Lithium, Inc.* | | | 539 | | | | 4,198 | |
| | |
Hyundai Engineering & Construction Co. Ltd. | | | 2,188 | | | | 54,111 | |
| | |
IJM Corp. Bhd. | | | 37,600 | | | | 14,994 | |
| | |
IRB Infrastructure Developers Ltd. | | | 48,040 | | | | 19,329 | |
| | |
IRCON International Ltd.(b) | | | 101,332 | | | | 168,869 | |
| | |
IS Dongseo Co. Ltd.* | | | 5,217 | | | | 97,151 | |
| | |
Jeio Co. Ltd.* | | | 931 | | | | 13,015 | |
| | |
Kalpataru Projects International Ltd. | | | 3,479 | | | | 27,708 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Construction & Engineering – (continued) | |
| | |
KEC International Ltd. | | | 6,678 | | | $ | 50,395 | |
| | |
KEPCO Engineering & Construction Co., Inc. | | | 141 | | | | 5,460 | |
| | |
KNR Constructions Ltd. | | | 6,325 | | | | 20,052 | |
| | |
Kontrolmatik Enerji ve Muhendislik A/S | | | 736 | | | | 6,829 | |
| | |
Larsen & Toubro Ltd. | | | 10,387 | | | | 365,416 | |
| | |
Larsen & Toubro Ltd., GDR(b) | | | 296 | | | | 10,419 | |
| | |
Metallurgical Corp. of China Ltd., Class A | | | 42,300 | | | | 19,132 | |
| | |
Metallurgical Corp. of China Ltd., Class H | | | 106,000 | | | | 20,998 | |
| | |
NBCC India Ltd. | | | 41,870 | | | | 32,990 | |
| | |
NCC Ltd. | | | 191,478 | | | | 332,205 | |
| | |
PNC Infratech Ltd.(b) | | | 2,700 | | | | 10,835 | |
| | |
Power Construction Corp. of China Ltd., Class A | | | 34,100 | | | | 24,510 | |
| | |
Praj Industries Ltd. | | | 5,935 | | | | 38,176 | |
| | |
PSG Corp. PCL, NVDR* | | | 300,700 | | | | 5,438 | |
| | |
Rail Vikas Nigam Ltd.(b) | | | 9,261 | | | | 17,146 | |
| | |
Ruentex Engineering & Construction Co. | | | 26,000 | | | | 79,760 | |
| | |
Run Long Construction Co. Ltd. | | | 6,768 | | | | 19,594 | |
| | |
Samsung Engineering Co. Ltd.* | | | 3,901 | | | | 68,601 | |
| | |
Shaanxi Construction Engineering Group Corp. Ltd., Class A | | | 4,900 | | | | 2,832 | |
| | |
Shanghai Construction Group Co. Ltd., Class A | | | 23,500 | | | | 8,445 | |
| | |
Shanghai Tunnel Engineering Co. Ltd., Class A | | | 14,100 | | | | 10,847 | |
| | |
Sichuan Road and Bridge Group Co. Ltd., Class A | | | 20,440 | | | | 21,535 | |
| | |
Sino-Thai Engineering & Construction PCL, NVDR | | | 39,100 | | | | 9,301 | |
| | |
Tekfen Holding A/S | | | 73,696 | | | | 106,379 | |
| | |
United Integrated Services Co. Ltd. | | | 5,504 | | | | 40,726 | |
| | |
Voltas Ltd. | | | 3,887 | | | | 39,099 | |
| | |
Waskita Karya Persero Tbk. PT* ‡ | | | 173,900 | | | | 2,021 | |
| | |
Yankey Engineering Co. Ltd. | | | 22,055 | | | | 179,853 | |
| | | | | | | 3,082,750 | |
See Accompanying Notes to the Financial Statements.
| | | | |
234 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Construction Materials – 1.1% | |
| | |
ACC Ltd. | | | 1,376 | | | $ | 31,206 | |
| | |
Ambuja Cements Ltd. | | | 10,904 | | | | 55,588 | |
| | |
Anhui Conch Cement Co. Ltd., Class A | | | 9,800 | | | | 32,394 | |
| | |
Anhui Conch Cement Co. Ltd., Class H | | | 34,500 | | | | 86,067 | |
| | |
Arabian Cement Co. | | | 2,310 | | | | 19,180 | |
| | |
Asia Cement Corp. | | | 77,000 | | | | 94,959 | |
| | |
BBMG Corp., Class A | | | 42,300 | | | | 11,965 | |
| | |
Berkah Beton Sadaya Tbk. PT* | | | 425,000 | | | | 1,338 | |
| | |
Birla Corp. Ltd. | | | 750 | | | | 11,469 | |
| | |
Bursa Cimento Fabrikasi A/S* | | | 266,772 | | | | 88,538 | |
| | |
Cementos Argos SA | | | 182,971 | | | | 209,469 | |
| | |
Cemex SAB de CV* | | | 410,600 | | | | 246,319 | |
| | |
Chia Hsin Cement Corp. | | | 20,400 | | | | 11,195 | |
| | |
China Jushi Co. Ltd., Class A | | | 9,600 | | | | 15,178 | |
| | |
China National Building Material Co. Ltd., Class H | | | 94,000 | | | | 44,690 | |
| | |
China Resources Cement Holdings Ltd. | | | 68,000 | | | | 17,468 | |
| | |
Cimsa Cimento Sanayi ve Ticaret A/S | | | 13,776 | | | | 17,899 | |
| | |
City Cement Co. | | | 4,208 | | | | 19,517 | |
| | |
CSG Holding Co. Ltd., Class B | | | 4,700 | | | | 1,394 | |
| | |
Dalmia Bharat Ltd. | | | 1,710 | | | | 43,218 | |
| | |
Eastern Province Cement Co. | | | 1,199 | | | | 11,809 | |
| | |
GCC SAB de CV | | | 1,872 | | | | 16,646 | |
| | |
Goldsun Building Materials Co. Ltd. | | | 27,000 | | | | 20,977 | |
| | |
Grasim Industries Ltd. | | | 5,734 | | | | 129,936 | |
| | |
Grupo Argos SA | | | 117,500 | | | | 253,354 | |
| | |
Grupo Argos SA (Preference) | | | 73,605 | | | | 115,650 | |
| | |
Hanil Cement Co. Ltd. | | | 7,802 | | | | 70,420 | |
| | |
Huaxin Cement Co. Ltd., Class A | | | 3,700 | | | | 7,533 | |
| | |
Huaxin Cement Co. Ltd., Class H | | | 10,400 | | | | 9,929 | |
| | |
Indocement Tunggal Prakarsa Tbk. PT | | | 28,800 | | | | 16,816 | |
| | |
JK Cement Ltd. | | | 530 | | | | 20,077 | |
| | |
JK Lakshmi Cement Ltd. | | | 2,744 | | | | 22,627 | |
| | |
Nuh Cimento Sanayi A/S | | | 2,068 | | | | 24,998 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Construction Materials – (continued) | |
| | |
Nuvoco Vistas Corp. Ltd.* | | | 3,650 | | | $ | 14,925 | |
| | |
Oyak Cimento Fabrikalari A/S* | | | 4,416 | | | | 11,136 | |
| | |
Qassim Cement Co. (The) | | | 1,998 | | | | 33,446 | |
| | |
Ramco Cements Ltd. (The) | | | 2,289 | | | | 27,264 | |
| | |
Rhi Magnesita India Ltd. | | | 1,850 | | | | 15,234 | |
| | |
Riyadh Cement Co. | | | 1,967 | | | | 15,362 | |
| | |
Saudi Cement Co. | | | 441 | | | | 5,842 | |
| | |
Semen Indonesia Persero Tbk. PT | | | 29,417 | | | | 11,296 | |
| | |
Shree Cement Ltd. | | | 188 | | | | 57,930 | |
| | |
Siam Cement PCL (The), NVDR | | | 6,100 | | | | 48,878 | |
| | |
Siam City Cement PCL, NVDR | | | 4,800 | | | | 17,829 | |
| | |
Southern Province Cement Co. | | | 1,634 | | | | 17,727 | |
| | |
SSANGYONG C&E Co. Ltd. | | | 4,263 | | | | 17,582 | |
| | |
Taiwan Cement Corp. | | | 94,000 | | | | 93,464 | |
| | |
Tangshan Jidong Cement Co. Ltd., Class A | | | 4,700 | | | | 4,592 | |
| | |
Tipco Asphalt PCL, NVDR | | | 23,400 | | | | 12,240 | |
| | |
TPI Polene PCL, NVDR | | | 1,870,700 | | | | 71,825 | |
| | |
UltraTech Cement Ltd. | | | 1,739 | | | | 175,913 | |
| | |
Universal Cement Corp. | | | 26,142 | | | | 20,432 | |
| | |
Yamama Cement Co. | | | 3,763 | | | | 29,088 | |
| | |
Yanbu Cement Co. | | | 2,888 | | | | 24,826 | |
| | | | | | | 2,506,654 | |
|
Consumer Finance – 1.0% | |
| | |
AEON Credit Service M Bhd. | | | 42,300 | | | | 100,856 | |
| | |
Bajaj Finance Ltd. | | | 4,089 | | | | 367,979 | |
| | |
BFI Finance Indonesia Tbk. PT | | | 343,100 | | | | 22,139 | |
| | |
Capri Global Capital Ltd. | | | 1,948 | | | | 17,805 | |
| | |
Cholamandalam Investment and Finance Co. Ltd. | | | 5,781 | | | | 78,967 | |
| | |
CreditAccess Grameen Ltd.* | | | 1,166 | | | | 22,368 | |
| | |
FinVolution Group, ADR | | | 58,891 | | | | 278,554 | |
| | |
Gentera SAB de CV(a) | | | 408,900 | | | | 433,067 | |
| | |
JMT Network Services PCL, NVDR | | | 14,200 | | | | 11,655 | |
| | |
Krungthai Card PCL, NVDR | | | 9,800 | | | | 11,929 | |
| | |
Mahindra & Mahindra Financial Services Ltd. | | | 9,024 | | | | 26,592 | |
| | |
Manappuram Finance Ltd. | | | 206,753 | | | | 341,324 | |
| | |
Muangthai Capital PCL, NVDR | | | 9,300 | | | | 9,444 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 235 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Finance – (continued) | |
| | |
Muthoot Finance Ltd. | | | 2,226 | | | $ | 34,722 | |
| | |
Ngern Tid Lor PCL, NVDR | | | 26,653 | | | | 14,238 | |
| | |
Poonawalla Fincorp Ltd. | | | 5,720 | | | | 24,238 | |
| | |
Qifu Technology, Inc., Class A, ADR | | | 3,713 | | | | 54,915 | |
| | |
Ratchthani Leasing PCL, NVDR | | | 117,400 | | | | 9,146 | |
| | |
Samsung Card Co. Ltd. | | | 539 | | | | 12,512 | |
| | |
SBI Cards & Payment Services Ltd. | | | 4,747 | | | | 42,542 | |
| | |
Shriram Finance Ltd. | | | 7,379 | | | | 166,606 | |
| | |
Srisawad Corp. PCL, NVDR | | | 14,000 | | | | 16,165 | |
| | |
Sundaram Finance Ltd. | | | 1,445 | | | | 55,064 | |
| | |
Yulon Finance Corp. | | | 4,672 | | | | 25,783 | |
| | | | | | | 2,178,610 | |
|
Consumer Staples Distribution & Retail – 1.2% | |
| | |
Abdullah Al Othaim Markets Co. | | | 7,595 | | | | 26,359 | |
| | |
Aeon Co. M Bhd. | | | 282,000 | | | | 63,923 | |
| | |
Al-Dawaa Medical Services Co. | | | 1,104 | | | | 27,868 | |
| | |
Alibaba Health Information Technology Ltd.* | | | 94,000 | | | | 55,382 | |
| | |
Almacenes Exito SA | | | 63,638 | | | | 55,071 | |
| | |
Almacenes Exito SA, BDR* | | | 51,700 | | | | 178,895 | |
| | |
Almunajem Foods Co. | | | 7,473 | | | | 123,899 | |
| | |
Atacadao SA | | | 9,400 | | | | 16,720 | |
| | |
Avenue Supermarts Ltd.* (b) | | | 2,573 | | | | 112,285 | |
| | |
Berli Jucker PCL | | | 14,300 | | | | 11,239 | |
| | |
BGF retail Co. Ltd. | | | 141 | | | | 14,428 | |
| | |
Bid Corp. Ltd. | | | 5,440 | | | | 114,735 | |
| | |
BIM Birlesik Magazalar A/S | | | 12,721 | | | | 122,297 | |
| | |
Cencosud SA | | | 33,276 | | | | 53,737 | |
| | |
Clicks Group Ltd. | | | 3,995 | | | | 58,526 | |
| | |
CP ALL PCL, NVDR | | | 70,500 | | | | 108,371 | |
| | |
CP Axtra PCL, NVDR | | | 28,900 | | | | 22,715 | |
| | |
Dada Nexus Ltd., ADR* (a) | | | 2,805 | | | | 10,771 | |
| | |
DaShenLin Pharmaceutical Group Co. Ltd., Class A | | | 4,320 | | | | 14,050 | |
| | |
Dis-Chem Pharmacies Ltd.(b) | | | 6,949 | | | | 9,048 | |
| | |
Dongsuh Cos., Inc. | | | 859 | | | | 10,978 | |
| | |
E-MART, Inc. | | | 392 | | | | 21,101 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Great Tree Pharmacy Co. Ltd. | | | 1,543 | | | $ | 16,151 | |
| | |
Grupo Comercial Chedraui SA de CV | | | 4,700 | | | | 27,250 | |
| | |
Grupo Mateus SA* | | | 9,800 | | | | 11,310 | |
| | |
GS Retail Co. Ltd. | | | 1,332 | | | | 23,966 | |
| | |
InRetail Peru Corp.(b) | | | 406 | | | | 12,606 | |
| | |
JD Health International, Inc.* (b) | | | 16,450 | | | | 74,738 | |
| | |
La Comer SAB de CV | | | 18,800 | | | | 37,438 | |
| | |
Magnit PJSC‡ | | | 2,296 | | | | — | |
| | |
Medplus Health Services Ltd.* | | | 1,824 | | | | 17,338 | |
| | |
Migros Ticaret A/S | | | 2,632 | | | | 31,415 | |
| | |
Nahdi Medical Co. | | | 611 | | | | 23,094 | |
| | |
Philippine Seven Corp.* | | | 10,780 | | | | 14,439 | |
| | |
Pick n Pay Stores Ltd.(a) | | | 6,784 | | | | 9,047 | |
| | |
Ping An Healthcare and Technology Co. Ltd.* (a) (b) | | | 9,600 | | | | 22,452 | |
| | |
President Chain Store Corp. | | | 9,840 | | | | 78,119 | |
| | |
Puregold Price Club, Inc. | | | 26,060 | | | | 12,447 | |
| | |
Raia Drogasil SA | | | 19,064 | | | | 97,531 | |
| | |
Robinsons Retail Holdings, Inc. | | | 187,620 | | | | 135,573 | |
| | |
Sendas Distribuidora SA | | | 32,900 | | | | 71,371 | |
| | |
Shenzhen Pagoda Industrial Group Corp. Ltd. | | | 24,500 | | | | 18,912 | |
| | |
Shoprite Holdings Ltd. | | | 7,238 | | | | 92,210 | |
| | |
SMU SA | | | 891,825 | | | | 153,951 | |
| | |
Sok Marketler Ticaret A/S | | | 6,048 | | | | 12,783 | |
| | |
SPAR Group Ltd. (The) | | | 2,560 | | | | 15,363 | |
| | |
Sumber Alfaria Trijaya Tbk. PT | | | 330,600 | | | | 60,147 | |
| | |
Sun Art Retail Group Ltd. | | | 70,500 | | | | 14,867 | |
| | |
Wal-Mart de Mexico SAB de CV | | | 79,900 | | | | 285,601 | |
| | | | | | | 2,602,517 | |
|
Containers & Packaging – 0.1% | |
| | |
Cheng Loong Corp. | | | 27,600 | | | | 24,081 | |
| | |
Klabin SA | | | 23,552 | | | | 99,943 | |
| | |
Pantai Indah Kapuk Dua Tbk. PT* | | | 81,600 | | | | 22,448 | |
| | |
SCG Packaging PCL, NVDR | | | 18,700 | | | | 18,730 | |
| | |
Taiwan Hon Chuan Enterprise Co. Ltd. | | | 9,000 | | | | 27,887 | |
| | |
Ton Yi Industrial Corp. | | | 21,000 | | | | 10,165 | |
See Accompanying Notes to the Financial Statements.
| | | | |
236 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Containers & Packaging – (continued) | |
| | |
Youlchon Chemical Co. Ltd. | | | 470 | | | $ | 9,762 | |
| | | | | | | 213,016 | |
|
Distributors – 0.1% | |
| | |
Autohellas Tourist and Trading SA | | | 8,098 | | | | 108,878 | |
| | |
Digidrive Distributors Ltd.* | | | 500 | | | | 809 | |
| | |
Sinomach Automobile Co. Ltd., Class A | | | 4,800 | | | | 4,788 | |
| | |
Transaction Capital Ltd.(a) | | | 256,291 | | | | 66,168 | |
| | |
Wuchan Zhongda Group Co. Ltd., Class A | | | 13,800 | | | | 8,618 | |
| | | | | | | 189,261 | |
|
Diversified Consumer Services – 0.3% | |
| | |
Advtech Ltd. | | | 24,310 | | | | 27,517 | |
| | |
China Education Group Holdings Ltd.(b) | | | 47,000 | | | | 38,983 | |
| | |
Cogna Educacao SA* | | | 52,400 | | | | 24,938 | |
| | |
East Buy Holding Ltd.* (a) (b) | | | 3,000 | | | | 12,231 | |
| | |
Fenbi Ltd.* (a) | | | 24,500 | | | | 14,873 | |
| | |
Gaotu Techedu, Inc., ADR* (a) | | | 5,978 | | | | 13,391 | |
| | |
Humansoft Holding Co. KSC | | | 3,251 | | | | 31,927 | |
| | |
Lung Yen Life Service Corp.* | | | 8,448 | | | | 9,272 | |
| | |
MegaStudyEdu Co. Ltd. | | | 2,820 | | | | 129,250 | |
| | |
National Co. for Learning & Education | | | 735 | | | | 19,317 | |
| | |
New Oriental Education & Technology Group, Inc.* | | | 23,500 | | | | 153,771 | |
| | |
Offcn Education Technology Co. Ltd., Class A* | | | 4,700 | | | | 2,537 | |
| | |
TAL Education Group, ADR* | | | 13,301 | | | | 116,650 | |
| | | | | | | 594,657 | |
|
Diversified REITs – 0.2% | |
| | |
Axis REIT, REIT | | | 70,600 | | | | 26,820 | |
| | |
Concentradora Fibra Danhos SA de CV, REIT | | | 14,700 | | | | 15,756 | |
| | |
Fibra Uno Administracion SA de CV, REIT | | | 70,500 | | | | 106,885 | |
| | |
Growthpoint Properties Ltd., REIT | | | 88,642 | | | | 45,818 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Diversified REITs – (continued) | |
| | |
Is Gayrimenkul Yatirim Ortakligi A/S, REIT* | | | 183,112 | | | $ | 140,055 | |
| | |
Redefine Properties Ltd., REIT | | | 234,980 | | | | 43,870 | |
| | |
SK REITs Co. Ltd., REIT | | | 6,195 | | | | 17,247 | |
| | |
Yuexiu REIT, REIT | | | 98,000 | | | | 14,028 | |
| | | | | | | 410,479 | |
|
Diversified Telecommunication Services – 1.0% | |
| | |
AL Yah Satellite Communications Co. PJSC | | | 43,340 | | | | 29,971 | |
| | |
China Tower Corp. Ltd., Class H(b) | | | 1,222,000 | | | | 114,007 | |
| | |
Chunghwa Telecom Co. Ltd. | | | 55,000 | | | | 196,701 | |
| | |
CITIC Telecom International Holdings Ltd. | | | 611,000 | | | | 232,700 | |
| | |
Converge Information and Communications Technology Solutions, Inc.* | | | 81,600 | | | | 12,037 | |
| | |
Dayamitra Telekomunikasi PT | | | 202,100 | | | | 7,888 | |
| | |
Emirates Telecommunications Group Co. PJSC | | | 52,734 | | | | 265,034 | |
| | |
Hellenic Telecommunications Organization SA | | | 5,405 | | | | 75,584 | |
| | |
HFCL Ltd. | | | 34,742 | | | | 27,207 | |
| | |
Indus Towers Ltd.* | | | 24,404 | | | | 50,532 | |
| | |
KT Corp. | | | 3,444 | | | | 83,260 | |
| | |
LG Uplus Corp. | | | 7,161 | | | | 53,606 | |
| | |
Magyar Telekom Telecommunications plc | | | 116,372 | | | | 180,540 | |
| | |
Ooredoo QPSC | | | 17,376 | | | | 47,198 | |
| | |
Operadora De Sites Mexicanos SAB de CV, Series A-1(a) | | | 9,400 | | | | 7,982 | |
| | |
PT Tower Bersama Infrastructure Tbk. | | | 42,300 | | | | 5,512 | |
| | |
Rostelecom PJSC* ‡ | | | 33,770 | | | | — | |
| | |
Rostelecom PJSC (Preference)‡ | | | 15,392 | | | | — | |
| | |
Sarana Menara Nusantara Tbk. PT | | | 315,700 | | | | 17,688 | |
| | |
Saudi Telecom Co. | | | 27,313 | | | | 279,566 | |
| | |
Sitios Latinoamerica SAB de CV* (a) | | | 63,700 | | | | 22,759 | |
| | |
Tata Communications Ltd. | | | 1,612 | | | | 32,203 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 237 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Diversified Telecommunication Services – (continued) | |
| | |
Tata Teleservices Maharashtra Ltd.* | | | 24,255 | | | $ | 25,068 | |
| | |
Telefonica Brasil SA | | | 9,400 | | | | 84,326 | |
| | |
Telekom Malaysia Bhd. | | | 19,600 | | | | 20,857 | |
| | |
Telkom Indonesia Persero Tbk. PT | | | 709,700 | | | | 155,924 | |
| | |
Telkom SA SOC Ltd.* (a) | | | 107,818 | | | | 125,665 | |
| | |
TIME dotCom Bhd. | | | 9,000 | | | | 10,049 | |
| | |
Turk Telekomunikasyon A/S* | | | 19,746 | | | | 13,407 | |
| | | | | | | 2,177,271 | |
|
Electric Utilities – 1.2% | |
| | |
Adani Energy Solutions Ltd.* | | | 5,969 | | | | 55,189 | |
| | |
Alupar Investimento SA | | | 3,640 | | | | 20,210 | |
| | |
Can2 Termik A/S* | | | 74,119 | | | | 48,334 | |
| | |
Centrais Eletricas Brasileiras SA | | | 28,200 | | | | 194,822 | |
| | |
Centrais Eletricas Brasileiras SA (Preference), Class B | | | 4,700 | | | | 35,835 | |
| | |
CESC Ltd. | | | 256,291 | | | | 260,881 | |
| | |
CEZ A/S | | | 2,726 | | | | 116,465 | |
| | |
Cia Energetica de Minas Gerais | | | 4,700 | | | | 14,353 | |
| | |
Cia Energetica de Minas Gerais (Preference) | | | 45,002 | | | | 104,764 | |
| | |
Cia Energetica do Ceara (Preference), Class A | | | 4,700 | | | | 37,223 | |
| | |
Cia Paranaense de Energia | | | 9,400 | | | | 76,963 | |
| | |
CPFL Energia SA | | | 4,700 | | | | 31,166 | |
| | |
CTEEP-Cia de Transmissao de Energia Eletrica Paulista (Preference) | | | 5,200 | | | | 21,850 | |
| | |
Enel Americas SA* | | | 507,571 | | | | 52,006 | |
| | |
Enel Chile SA | | | 795,214 | | | | 46,939 | |
| | |
Energisa SA | | | 4,700 | | | | 43,440 | |
| | |
Enerjisa Enerji A/S(b) | | | 7,676 | | | | 13,196 | |
| | |
Equatorial Energia SA | | | 14,100 | | | | 88,352 | |
| | |
Federal Grid Co. - Rosseti PJSC (Registered)* ‡ | | | 22,532,366 | | | | — | |
| | |
Inter RAO UES PJSC‡ | | | 1,596,292 | | | | — | |
| | |
Interconexion Electrica SA ESP | | | 12,408 | | | | 43,490 | |
| | |
Korea Electric Power Corp.* | | | 6,345 | | | | 79,492 | |
| | |
Manila Electric Co. | | | 5,840 | | | | 36,539 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electric Utilities – (continued) | |
| | |
Mosenergo PJSC‡ | | | 4,455,000 | | | $ | — | |
| | |
Neoenergia SA | | | 4,700 | | | | 16,328 | |
| | |
ODAS Elektrik Uretim ve Sanayi Ticaret A/S* | | | 429,486 | | | | 179,277 | |
| | |
Power Grid Corp. of India Ltd. | | | 119,380 | | | | 289,851 | |
| | |
Public Power Corp. SA* | | | 3,381 | | | | 34,415 | |
| | |
RusHydro PJSC‡ | | | 2,361,000 | | | | — | |
| | |
Saudi Electricity Co. | | | 22,654 | | | | 107,485 | |
| | |
SJVN Ltd. | | | 205,813 | | | | 175,633 | |
| | |
Synergy Grid & Development Phils, Inc. | | | 394,800 | | | | 51,490 | |
| | |
Tata Power Co. Ltd. (The) | | | 25,051 | | | | 72,016 | |
| | |
Tenaga Nasional Bhd. | | | 75,200 | | | | 156,256 | |
| | |
Torrent Power Ltd. | | | 1,927 | | | | 16,824 | |
| | |
Transmissora Alianca de Energia Eletrica SA | | | 5,000 | | | | 33,502 | |
| | | | | | | 2,554,586 | |
|
Electrical Equipment – 1.2% | |
| | |
ABB India Ltd. | | | 1,002 | | | | 49,454 | |
| | |
AcBel Polytech, Inc. | | | 22,918 | | | | 26,850 | |
| | |
Amara Raja Energy & Mobility Ltd. | | | 4,361 | | | | 32,119 | |
| | |
Bharat Heavy Electricals Ltd. | | | 21,300 | | | | 30,917 | |
| | |
Bizlink Holding, Inc. | | | 2,070 | | | | 16,051 | |
| | |
CG Power & Industrial Solutions Ltd. | | | 12,320 | | | | 57,724 | |
| | |
Chicony Power Technology Co. Ltd. | | | 5,232 | | | | 18,066 | |
| | |
Chung-Hsin Electric & Machinery Manufacturing Corp. | | | 7,728 | | | | 22,206 | |
| | |
CS Wind Corp. | | | 581 | | | | 19,660 | |
| | |
Dongfang Electric Corp. Ltd., Class A | | | 5,000 | | | | 10,180 | |
| | |
Doosan Enerbility Co. Ltd.* | | | 6,856 | | | | 68,126 | |
| | |
Doosan Fuel Cell Co. Ltd.* | | | 690 | | | | 8,394 | |
| | |
Ecopro BM Co. Ltd. | | | 705 | | | | 102,418 | |
| | |
ElSewedy Electric Co. | | | 21,462 | | | | 18,821 | |
| | |
Fangda Carbon New Material Co. Ltd., Class A* | | | 5,300 | | | | 4,273 | |
| | |
Farasis Energy Gan Zhou Co. Ltd., Class A* | | | 784 | | | | 1,887 | |
| | |
Finolex Cables Ltd. | | | 3,178 | | | | 34,221 | |
See Accompanying Notes to the Financial Statements.
| | | | |
238 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electrical Equipment – (continued) | |
| | |
Fortune Electric Co. Ltd. | | | 7,560 | | | $ | 52,210 | |
| | |
Goldwind Science & Technology Co. Ltd. | | | 15,000 | | | | 7,151 | |
| | |
Goldwind Science & Technology Co. Ltd., Class A | | | 9,600 | | | | 11,531 | |
| | |
GoodWe Technologies Co. Ltd., Class A | | | 343 | | | | 5,460 | |
| | |
Gotion High-tech Co. Ltd., Class A* | | | 4,600 | | | | 14,306 | |
| | |
Graphite India Ltd. | | | 3,381 | | | | 18,948 | |
| | |
Gulf Cables & Electrical Industries Group Co. KSCP | | | 4,140 | | | | 15,782 | |
| | |
Havells India Ltd. | | | 4,270 | | | | 63,910 | |
| | |
HD Hyundai Electric Co. Ltd. | | | 441 | | | | 24,490 | |
| | |
Hitachi Energy India Ltd. | | | 371 | | | | 18,462 | |
| | |
Hongfa Technology Co. Ltd., Class A | | | 4,800 | | | | 19,021 | |
| | |
Hyosung Heavy Industries Corp.* | | | 1,645 | | | | 207,916 | |
| | |
Jiangsu Zhongtian Technology Co. Ltd., Class A | | | 4,500 | | | | 8,603 | |
| | |
Jiangxi Special Electric Motor Co. Ltd., Class A* | | | 4,900 | | | | 8,008 | |
| | |
KEI Industries Ltd. | | | 960 | | | | 27,700 | |
| | |
Korea Electric Terminal Co. Ltd. | | | 2,491 | | | | 116,384 | |
| | |
LG Energy Solution Ltd.* | | | 658 | | | | 187,819 | |
| | |
LS Corp. | | | 480 | | | | 27,829 | |
| | |
LS Electric Co. Ltd. | | | 490 | | | | 23,220 | |
| | |
Ming Yang Smart Energy Group Ltd., Class A | | | 4,500 | | | | 8,590 | |
| | |
NARI Technology Co. Ltd., Class A | | | 12,000 | | | | 36,977 | |
| | |
Ningbo Ronbay New Energy Technology Co. Ltd., Class A | | | 658 | | | | 3,978 | |
| | |
Polycab India Ltd. | | | 950 | | | | 56,162 | |
| | |
POSCO Future M Co. Ltd. | | | 479 | | | | 83,880 | |
| | |
Pylon Technologies Co. Ltd., Class A | | | 343 | | | | 5,338 | |
| | |
Sarkuysan Elektrolitik Bakir Sanayi ve Ticaret A/S | | | 150,118 | | | | 167,454 | |
| | |
Shanghai Electric Group Co. Ltd., Class A* | | | 24,000 | | | | 14,561 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electrical Equipment – (continued) | |
| | |
Shihlin Electric & Engineering Corp. | | | 5,136 | | | $ | 14,996 | |
| | |
Sociedad Quimica y Minera de Chile SA (Preference), Class B | | | 3,901 | | | | 188,120 | |
| | |
SPG Co. Ltd. | | | 686 | | | | 13,714 | |
| | |
Suzlon Energy Ltd.* | | | 365,014 | | | | 134,153 | |
| | |
Ta Ya Electric Wire & Cable | | | 26,249 | | | | 25,897 | |
| | |
Taihan Electric Wire Co. Ltd.* | | | 2,058 | | | | 16,930 | |
| | |
Tatung Co. Ltd.* | | | 30,816 | | | | 34,013 | |
| | |
TBEA Co. Ltd., Class A | | | 11,050 | | | | 21,124 | |
| | |
Teco Electric and Machinery Co. Ltd. | | | 22,000 | | | | 31,269 | |
| | |
Triveni Turbine Ltd.* | | | 6,484 | | | | 27,974 | |
| | |
V-Guard Industries Ltd. | | | 6,399 | | | | 23,026 | |
| | |
Voltronic Power Technology Corp. | | | 1,000 | | | | 39,926 | |
| | |
Walsin Lihwa Corp. | | | 84,769 | | | | 89,774 | |
| | |
WEG SA | | | 23,500 | | | | 153,824 | |
| | |
XTC New Energy Materials Xiamen Co. Ltd., Class A | | | 539 | | | | 3,102 | |
| | |
Zhejiang Chint Electrics Co. Ltd., Class A | | | 4,700 | | | | 14,829 | |
| | |
Zhejiang HangKe Technology, Inc. Co., Class A | | | 490 | | | | 1,644 | |
| | | | | | | 2,591,372 | |
|
Electronic Equipment, Instruments & Components – 4.1% | |
| | |
AAC Technologies Holdings, Inc. | | | 14,000 | | | | 25,192 | |
| | |
Asia Optical Co., Inc. | | | 17,664 | | | | 32,948 | |
| | |
AUO Corp. | | | 199,872 | | | | 96,131 | |
| | |
Aurora Corp. | | | 4,316 | | | | 9,847 | |
| | |
BH Co. Ltd. | | | 8,460 | | | | 117,139 | |
| | |
BOE Technology Group Co. Ltd., Class A | | | 89,300 | | | | 47,834 | |
| | |
BOE Varitronix Ltd. | | | 7,000 | | | | 5,958 | |
| | |
Chang Wah Electromaterials, Inc. | | | 141,000 | | | | 131,284 | |
| | |
Channel Well Technology Co. Ltd. | | | 8,742 | | | | 22,020 | |
| | |
Cheng Uei Precision Industry Co. Ltd. | | | 134,384 | | | | 159,305 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 239 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
China Railway Signal & Communication Corp. Ltd., Class A | | | 31,500 | | | $ | 20,231 | |
| | |
Chroma ATE, Inc. | | | 8,000 | | | | 53,769 | |
| | |
Compeq Manufacturing Co. Ltd. | | | 33,000 | | | | 53,720 | |
| | |
Coretronic Corp. | | | 9,168 | | | | 20,634 | |
| | |
Co-Tech Development Corp. | | | 10,464 | | | | 18,841 | |
| | |
Cowell e Holdings, Inc.* | | | 12,000 | | | | 28,771 | |
| | |
Daeduck Electronics Co. Ltd. | | | 893 | | | | 13,204 | |
| | |
Daejoo Electronic Materials Co. Ltd. | | | 250 | | | | 12,773 | |
| | |
DataTec Ltd. | | | 81,010 | | | | 152,324 | |
| | |
Delta Electronics Thailand PCL, NVDR | | | 73,000 | | | | 160,451 | |
| | |
Delta Electronics, Inc. | | | 31,696 | | | | 283,881 | |
| | |
Dreamtech Co. Ltd. | | | 10,837 | | | | 83,531 | |
| | |
E Ink Holdings, Inc. | | | 15,000 | | | | 77,694 | |
| | |
Elite Material Co. Ltd. | | | 8,464 | | | | 93,682 | |
| | |
EM-Tech Co. Ltd. | | | 4,841 | | | | 177,969 | |
| | |
Everdisplay Optronics Shanghai Co. Ltd., Class A* | | | 26,592 | | | | 9,520 | |
| | |
FLEXium Interconnect, Inc. | | | 11,896 | | | | 30,625 | |
| | |
Forth Corp. PCL, NVDR | | | 14,600 | | | | 9,058 | |
| | |
Foxconn Industrial Internet Co. Ltd., Class A | | | 32,900 | | | | 66,177 | |
| | |
Foxconn Technology Co. Ltd. | | | 37,880 | | | | 61,197 | |
| | |
Genius Electronic Optical Co. Ltd. | | | 2,237 | | | | 26,243 | |
| | |
Global Brands Manufacture Ltd. | | | 109,632 | | | | 208,211 | |
| | |
GoerTek, Inc., Class A | | | 3,800 | | | | 9,362 | |
| | |
Gold Circuit Electronics Ltd. | | | 5,240 | | | | 28,434 | |
| | |
Hana Microelectronics PCL, NVDR | | | 9,800 | | | | 14,246 | |
| | |
Hannstar Board Corp. | | | 118,616 | | | | 203,697 | |
| | |
HannStar Display Corp.* | | | 69,288 | | | | 23,605 | |
| | |
Hollysys Automation Technologies Ltd.* (a) | | | 21,902 | | | | 449,210 | |
| | |
Holy Stone Enterprise Co. Ltd. | | | 60,442 | | | | 176,844 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Hon Hai Precision Industry Co. Ltd. | | | 329,000 | | | $ | 978,835 | |
| | |
Honeywell Automation India Ltd. | | | 32 | | | | 13,835 | |
| | |
Innolux Corp. | | | 251,684 | | | | 94,280 | |
| | |
INTOPS Co. Ltd. | | | 3,666 | | | | 64,875 | |
| | |
ITEQ Corp. | | | 86,264 | | | | 201,863 | |
| | |
Jaymart Group Holdings PCL, NVDR | | | 277,300 | | | | 126,528 | |
| | |
KCE Electronics PCL, NVDR | | | 9,300 | | | | 13,131 | |
| | |
Kingboard Holdings Ltd. | | | 23,500 | | | | 57,124 | |
| | |
Kingboard Laminates Holdings Ltd. | | | 27,500 | | | | 25,762 | |
| | |
L&F Co. Ltd. | | | 412 | | | | 39,780 | |
| | |
Largan Precision Co. Ltd. | | | 1,672 | | | | 106,707 | |
| | |
LG Display Co. Ltd.* | | | 6,102 | | | | 55,076 | |
| | |
LG Innotek Co. Ltd. | | | 423 | | | | 69,845 | |
| | |
Lingyi iTech Guangdong Co., Class A | | | 15,900 | | | | 13,188 | |
| | |
Lotes Co. Ltd. | | | 1,332 | | | | 33,798 | |
| | |
Lotte Energy Materials Corp. | | | 235 | | | | 6,699 | |
| | |
Luxshare Precision Industry Co. Ltd., Class A | | | 9,600 | | | | 42,988 | |
| | |
Mcnex Co. Ltd. | | | 657 | | | | 13,475 | |
| | |
MH Development Ltd.* ‡ | | | 22,000 | | | | — | |
| | |
Nan Ya Printed Circuit Board Corp. | | | 4,000 | | | | 29,104 | |
| | |
Nationgate Holdings Bhd. | | | 267,900 | | | | 64,663 | |
| | |
Nex Point Parts PCL, NVDR* | | | 47,500 | | | | 11,498 | |
| | |
Nichidenbo Corp. | | | 76,952 | | | | 131,911 | |
| | |
OFILM Group Co. Ltd., Class A* | | | 4,700 | | | | 6,570 | |
| | |
Pan-International Industrial Corp. | | | 24,000 | | | | 25,121 | |
| | |
Park Systems Corp. | | | 200 | | | | 20,732 | |
| | |
Primax Electronics Ltd. | | | 14,600 | | | | 31,059 | |
| | |
Quest Holdings SA | | | 10,011 | | | | 55,554 | |
| | |
Raytron Technology Co. Ltd., Class A | | | 343 | | | | 2,207 | |
| | |
Redington Ltd. | | | 235,846 | | | | 404,508 | |
| | |
Samsung Electro-Mechanics Co. Ltd. | | | 1,598 | | | | 147,075 | |
| | |
Samsung SDI Co. Ltd. | | | 846 | | | | 266,538 | |
See Accompanying Notes to the Financial Statements.
| | | | |
240 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Seronics Co. Ltd.* | | | 1,488 | | | $ | 27,434 | |
| | |
Shanghai Friendess Electronic Technology Corp. Ltd., Class A | | | 376 | | | | 12,311 | |
| | |
Shengyi Technology Co. Ltd., Class A | | | 9,600 | | | | 23,075 | |
| | |
Shenzhen Kaifa Technology Co. Ltd., Class A | | | 4,700 | | | | 11,034 | |
| | |
Simplo Technology Co. Ltd. | | | 6,040 | | | | 62,104 | |
| | |
Sinbon Electronics Co. Ltd. | | | 3,000 | | | | 25,621 | |
| | |
SOLUM Co. Ltd.* | | | 588 | | | | 12,582 | |
| | |
Solus Advanced Materials Co. Ltd. | | | 377 | | | | 6,113 | |
| | |
STCUBE* | | | 1,739 | | | | 12,876 | |
| | |
Sunny Optical Technology Group Co. Ltd. | | | 11,800 | | | | 98,854 | |
| | |
SUPCON Technology Co. Ltd., Class A | | | 1,771 | | | | 10,551 | |
| | |
Supreme Electronics Co. Ltd. | | | 178,484 | | | | 305,957 | |
| | |
Synnex Technology International Corp. | | | 38,784 | | | | 82,148 | |
| | |
Taiwan Surface Mounting Technology Corp. | | | 1,000 | | | | 2,818 | |
| | |
Taiwan Union Technology Corp. | | | 105,208 | | | | 345,449 | |
| | |
TCL Technology Group Corp., Class A* | | | 41,360 | | | | 22,211 | |
| | |
Test Research, Inc. | | | 69,176 | | | | 128,179 | |
| | |
Tong Hsing Electronic Industries Ltd. | | | 5,956 | | | | 24,606 | |
| | |
TPK Holding Co. Ltd. | | | 143,000 | | | | 141,303 | |
| | |
Tripod Technology Corp. | | | 14,000 | | | | 71,219 | |
| | |
TXC Corp. | | | 10,336 | | | | 30,560 | |
| | |
Unimicron Technology Corp. | | | 35,952 | | | | 158,506 | |
| | |
Unisplendour Corp. Ltd., Class A* | | | 4,900 | | | | 13,130 | |
| | |
Unitech Printed Circuit Board Corp. | | | 247,696 | | | | 141,279 | |
| | |
Universal Scientific Industrial Shanghai Co. Ltd., Class A | | | 4,700 | | | | 9,332 | |
| | |
VS Industry Bhd. | | | 137,700 | | | | 25,722 | |
| | |
Wah Lee Industrial Corp. | | | 66,640 | | | | 193,746 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electronic Equipment, Instruments & Components – (continued) | |
| | |
Walsin Technology Corp. | | | 9,378 | | | $ | 30,214 | |
| | |
Weikeng Industrial Co. Ltd. | | | 141,000 | | | | 116,939 | |
| | |
Wingtech Technology Co. Ltd., Class A* | | | 3,100 | | | | 21,083 | |
| | |
Wintek Corp.* ‡ | | | 64,000 | | | | — | |
| | |
WPG Holdings Ltd. | | | 47,440 | | | | 104,723 | |
| | |
WT Microelectronics Co. Ltd. | | | 14,000 | | | | 51,149 | |
| | |
WUS Printed Circuit Kunshan Co. Ltd., Class A | | | 5,170 | | | | 13,804 | |
| | |
Yageo Corp. | | | 8,347 | | | | 135,364 | |
| | |
Zhejiang Dahua Technology Co. Ltd., Class A | | | 2,900 | | | | 8,084 | |
| | |
Zhen Ding Technology Holding Ltd. | | | 17,150 | | | | 51,553 | |
| | | | | | | 8,901,524 | |
|
Energy Equipment & Services – 0.3% | |
| | |
ADNOC Drilling Co. PJSC | | | 38,152 | | | | 37,809 | |
| | |
Bumi Armada Bhd.* | | | 1,330,100 | | | | 153,543 | |
| | |
China Oilfield Services Ltd., Class A | | | 5,000 | | | | 10,658 | |
| | |
China Oilfield Services Ltd., Class H | | | 28,000 | | | | 33,065 | |
| | |
COFCO Capital Holdings Co. Ltd., Class A | | | 4,900 | | | | 4,808 | |
| | |
Dialog Group Bhd. | | | 51,700 | | | | 23,330 | |
| | |
Gulf International Services QSC | | | 360,114 | | | | 271,000 | |
| | |
Velesto Energy Bhd.* | | | 340,800 | | | | 18,240 | |
| | |
Yinson Holdings Bhd. | | | 35,800 | | | | 18,409 | |
| | | | | | | 570,862 | |
|
Entertainment – 0.9% | |
| | |
37 Interactive Entertainment Network Technology Group Co. Ltd., Class A | | | 4,700 | | | | 13,294 | |
| | |
Alibaba Pictures Group Ltd.* | | | 540,000 | | | | 34,507 | |
| | |
Bilibili, Inc., Class Z* (a) | | | 3,760 | | | | 50,889 | |
| | |
China Ruyi Holdings Ltd.* (a) | | | 88,000 | | | | 20,244 | |
| | |
CJ CGV Co. Ltd.* | | | 35,720 | | | | 135,416 | |
| | |
CJ ENM Co. Ltd.* | | | 392 | | | | 15,122 | |
| | |
Cloud Music, Inc.* (b) | | | 2,400 | | | | 27,283 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 241 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Entertainment – (continued) | |
| | |
CMGE Technology Group Ltd.* | | | 98,000 | | | $ | 16,407 | |
| | |
Com2uSCorp | | | 133 | | | | 4,131 | |
| | |
Devsisters Co. Ltd.* | | | 235 | | | | 8,422 | |
| | |
Gamania Digital Entertainment Co. Ltd. | | | 47,000 | | | | 97,087 | |
| | |
HYBE Co. Ltd.* | | | 270 | | | | 43,882 | |
| | |
International Games System Co. Ltd. | | | 2,320 | | | | 44,562 | |
| | |
iQIYI, Inc., ADR* (a) | | | 7,595 | | | | 35,393 | |
| | |
JYP Entertainment Corp. | | | 470 | | | | 35,706 | |
| | |
Kakao Games Corp.* | | | 956 | | | | 16,493 | |
| | |
Kingsoft Corp. Ltd. | | | 15,800 | | | | 55,126 | |
| | |
Krafton, Inc.* | | | 564 | | | | 68,404 | |
| | |
MD Pictures Tbk. PT* | | | 28,800 | | | | 4,369 | |
| | |
MNC Digital Entertainment Tbk. PT* | | | 37,600 | | | | 7,125 | |
| | |
NCSoft Corp. | | | 271 | | | | 46,653 | |
| | |
Neowiz* | | | 470 | | | | 9,588 | |
| | |
NetDragon Websoft Holdings Ltd. | | | 94,000 | | | | 166,746 | |
| | |
NetEase, Inc. | | | 28,800 | | | | 619,462 | |
| | |
Netmarble Corp.* (b) | | | 410 | | | | 11,718 | |
| | |
Nexon Games Co. Ltd.* | | | 1,034 | | | | 11,484 | |
| | |
NHN Corp.* | | | 630 | | | | 9,959 | |
| | |
Pearl Abyss Corp.* | | | 517 | | | | 18,853 | |
| | |
Perfect World Co. Ltd., Class A | | | 4,100 | | | | 6,723 | |
| | |
PVR Inox Ltd.* | | | 2,961 | | | | 56,840 | |
| | |
Saregama India Ltd. | | | 2,498 | | | | 9,665 | |
| | |
SM Entertainment Co. Ltd. | | | 144 | | | | 10,748 | |
| | |
SMI Holdings Group Ltd.* ‡ | | | 72,000 | | | | — | |
| | |
Studio Dragon Corp.* | | | 188 | | | | 6,800 | |
| | |
Tencent Music Entertainment Group, ADR* | | | 7,897 | | | | 57,332 | |
| | |
Tencent Music Entertainment Group, Class A* | | | 4,700 | | | | 16,308 | |
| | |
Webzen, Inc. | | | 5,640 | | | | 57,254 | |
| | |
Wemade Co. Ltd. | | | 388 | | | | 11,276 | |
| | |
Wemade Max Co. Ltd.* | | | 784 | | | | 6,026 | |
| | |
Wysiwyg Studios Co. Ltd.* | | | 34,216 | | | | 59,537 | |
| | |
XD, Inc.* (b) | | | 8,000 | | | | 12,105 | |
| | |
XPEC Entertainment, Inc.* ‡ | | | 14,800 | | | | — | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Entertainment – (continued) | |
| | |
YG Entertainment, Inc. | | | 605 | | | $ | 24,593 | |
| | |
Zhejiang Century Huatong Group Co. Ltd., Class A* | | | 11,280 | | | | 9,033 | |
| | | | | | | 1,972,565 | |
|
Financial Services – 1.4% | |
| | |
Aavas Financiers Ltd.* | | | 2,016 | | | | 34,088 | |
| | |
Aditya Birla Capital Ltd.* | | | 8,967 | | | | 18,573 | |
| | |
Al Waha Capital PJSC | | | 387,750 | | | | 200,579 | |
| | |
Alliance International Education Leasing Holdings Ltd.* (b) | | | 21,000 | | | | 3,811 | |
| | |
Aptus Value Housing Finance India Ltd. | | | 3,822 | | | | 13,255 | |
| | |
AVIC Industry-Finance Holdings Co. Ltd., Class A | | | 23,500 | | | | 10,693 | |
| | |
Bajaj Finserv Ltd. | | | 6,224 | | | | 117,332 | |
| | |
Bajaj Holdings & Investment Ltd. | | | 552 | | | | 45,922 | |
| | |
Can Fin Homes Ltd. | | | 4,678 | | | | 42,895 | |
| | |
Chailease Holding Co. Ltd. | | | 25,881 | | | | 140,037 | |
| | |
Cielo SA | | | 32,900 | | | | 22,964 | |
| | |
Corp. Financiera Colombiana SA | | | 37,459 | | | | 114,272 | |
| | |
CSSC Hong Kong Shipping Co. Ltd.(b) | | | 658,000 | | | | 116,049 | |
| | |
E-Finance for Digital & Financial Investments | | | 7,889 | | | | 4,482 | |
| | |
Far East Horizon Ltd.(a) | | | 52,000 | | | | 36,618 | |
| | |
Fawry for Banking & Payment Technology Services SAE* | | | 44,933 | | | | 7,497 | |
| | |
FirstRand Ltd. | | | 139,825 | | | | 458,254 | |
| | |
Genertec Universal Medical Group Co. Ltd.(b) | | | 305,500 | | | | 155,003 | |
| | |
Grupo de Inversiones Suramericana SA | | | 2,695 | | | | 21,042 | |
| | |
Grupo de Inversiones Suramericana SA (Preference) | | | 3,587 | | | | 10,414 | |
| | |
Home First Finance Co. India Ltd.(b) | | | 1,225 | | | | 13,275 | |
| | |
Housing & Urban Development Corp. Ltd. | | | 144,478 | | | | 130,581 | |
| | |
IIFL Finance Ltd. | | | 3,626 | | | | 26,989 | |
See Accompanying Notes to the Financial Statements.
| | | | |
242 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Financial Services – (continued) | |
| | |
Indian Railway Finance Corp. Ltd.(b) | | | 50,666 | | | $ | 44,180 | |
| | |
Kakaopay Corp.* | | | 398 | | | | 10,079 | |
| | |
L&T Finance Holdings Ltd. | | | 11,562 | | | | 18,469 | |
| | |
LIC Housing Finance Ltd. | | | 9,682 | | | | 53,399 | |
| | |
Meritz Financial Group, Inc. | | | 2,868 | | | | 106,604 | |
| | |
National Investments Co. KSCP | | | 20,286 | | | | 12,189 | |
| | |
NICE Holdings Co. Ltd. | | | 6,170 | | | | 54,776 | |
| | |
One 97 Communications Ltd.* | | | 4,042 | | | | 44,700 | |
| | |
Piramal Enterprises Ltd. | | | 3,384 | | | | 39,643 | |
| | |
PNB Housing Finance Ltd.* (b) | | | 18,800 | | | | 166,281 | |
| | |
Power Finance Corp. Ltd. | | | 42,939 | | | | 127,179 | |
| | |
REC Ltd. | | | 29,397 | | | | 101,546 | |
| | |
Remgro Ltd. | | | 15,463 | | | | 118,841 | |
| | |
Shandong Hi-Speed Holdings Group Ltd.* | | | 49,500 | | | | 34,415 | |
| | |
Turkiye Sinai Kalkinma Bankasi A/S* | | | 488,330 | | | | 115,641 | |
| | |
Yeahka Ltd.* | | | 13,200 | | | | 24,158 | |
| | |
Yuanta Financial Holding Co. Ltd. | | | 368,228 | | | | 275,873 | |
| | | | | | | 3,092,598 | |
|
Food Products – 2.7% | |
| | |
Adani Wilmar Ltd.* | | | 2,491 | | | | 9,772 | |
| | |
Agthia Group PJSC | | | 10,622 | | | | 12,869 | |
| | |
Alicorp SAA | | | 108,194 | | | | 163,629 | |
| | |
Almarai Co. JSC | | | 3,679 | | | | 54,818 | |
| | |
Anjoy Foods Group Co. Ltd., Class A | | | 500 | | | | 8,828 | |
| | |
Astra Agro Lestari Tbk. PT | | | 131,600 | | | | 58,406 | |
| | |
AVI Ltd. | | | 14,137 | | | | 52,493 | |
| | |
Balrampur Chini Mills Ltd. | | | 3,850 | | | | 19,105 | |
| | |
Beijing Dabeinong Technology Group Co. Ltd., Class A | | | 5,300 | | | | 5,062 | |
| | |
Betagro PCL | | | 24,400 | | | | 13,917 | |
| | |
Bombay Burmah Trading Co. | | | 235 | | | | 3,821 | |
| | |
BRF SA* | | | 343,100 | | | | 725,932 | |
| | |
Britannia Industries Ltd. | | | 1,871 | | | | 99,473 | |
| | |
CCL Products India Ltd. | | | 2,597 | | | | 18,408 | |
| | |
Century Pacific Food, Inc. | | | 17,700 | | | | 8,735 | |
| | |
Charoen Pokphand Enterprise | | | 13,300 | | | | 37,110 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Food Products – (continued) | |
| | |
Charoen Pokphand Foods PCL, NVDR | | | 79,900 | | | $ | 41,570 | |
| | |
Charoen Pokphand Indonesia Tbk. PT* | | | 115,100 | | | | 42,026 | |
| | |
Cherkizovo Group PJSC‡ | | | 2,594 | | | | — | |
| | |
China Feihe Ltd.(b) | | | 94,000 | | | | 58,385 | |
| | |
China Huiyuan Juice Group Ltd.* ‡ | | | 24,000 | | | | — | |
| | |
China Mengniu Dairy Co. Ltd. | | | 47,000 | | | | 153,471 | |
| | |
China Modern Dairy Holdings Ltd.(a) | | | 1,001,000 | | | | 102,344 | |
| | |
China Youran Dairy Group Ltd.(b) | | | 470,000 | | | | 88,299 | |
| | |
Chongqing Fuling Zhacai Group Co. Ltd., Class A | | | 3,120 | | | | 6,587 | |
| | |
CJ CheilJedang Corp. | | | 215 | | | | 44,972 | |
| | |
CJ CheilJedang Corp. (Preference) | | | 104 | | | | 9,549 | |
| | |
COFCO Joycome Foods Ltd.* (b) | | | 1,128,000 | | | | 262,373 | |
| | |
Daesang Corp. | | | 7,549 | | | | 111,121 | |
| | |
Dongwon Industries Co. Ltd. | | | 735 | | | | 16,245 | |
| | |
Foshan Haitian Flavouring & Food Co. Ltd., Class A | | | 5,880 | | | | 30,251 | |
| | |
Garudafood Putra Putri Jaya Tbk. PT | | | 463,100 | | | | 12,244 | |
| | |
Great Wall Enterprise Co. Ltd. | | | 15,840 | | | | 24,809 | |
| | |
Gruma SAB de CV, Class B | | | 3,615 | | | | 62,823 | |
| | |
Grupo Bimbo SAB de CV, Class A, Series A(a) | | | 20,700 | | | | 84,139 | |
| | |
Grupo Nutresa SA | | | 1,692 | | | | 19,943 | |
| | |
Guan Chong Bhd.* | | | 29,400 | | | | 13,390 | |
| | |
Guangdong Haid Group Co. Ltd., Class A | | | 3,400 | | | | 20,926 | |
| | |
Harim Holdings Co. Ltd. | | | 15,698 | | | | 76,831 | |
| | |
Health & Happiness H&H International Holdings Ltd. | | | 94,000 | | | | 106,198 | |
| | |
Heilongjiang Agriculture Co. Ltd., Class A | | | 5,200 | | | | 9,053 | |
| | |
Henan Shuanghui Investment & Development Co. Ltd., Class A | | | 5,000 | | | | 17,908 | |
| | |
Huishan Dairy* ‡ | | | 158,000 | | | | — | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 243 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Food Products – (continued) | |
| | |
Indofood CBP Sukses Makmur Tbk. PT | | | 51,800 | | | $ | 33,751 | |
| | |
Indofood Sukses Makmur Tbk. PT | | | 122,200 | | | | 51,157 | |
| | |
Inner Mongolia Yili Industrial Group Co. Ltd., Class A | | | 8,200 | | | | 30,724 | |
| | |
IOI Corp. Bhd. | | | 39,200 | | | | 32,334 | |
| | |
Japfa Comfeed Indonesia Tbk. PT | | | 2,091,500 | | | | 161,290 | |
| | |
JBS SA | | | 18,900 | | | | 75,068 | |
| | |
Jonjee Hi-Tech Industrial And Commercial Holding Co. Ltd., Class A* | | | 4,800 | | | | 22,039 | |
| | |
Kuala Lumpur Kepong Bhd. | | | 14,131 | | | | 65,190 | |
| | |
Leong Hup International Bhd.(b) | | | 465,300 | | | | 61,037 | |
| | |
Lien Hwa Industrial Holdings Corp. | | | 17,301 | | | | 33,018 | |
| | |
Lotte Wellfood Co. Ltd. | | | 1,128 | | | | 95,215 | |
| | |
M Dias Branco SA | | | 4,700 | | | | 30,373 | |
| | |
Marfrig Global Foods SA | | | 169,200 | | | | 216,742 | |
| | |
Marico Ltd. | | | 8,460 | | | | 54,519 | |
| | |
Mayora Indah Tbk. PT | | | 83,900 | | | | 15,053 | |
| | |
Minerva SA | | | 89,300 | | | | 134,047 | |
| | |
Monde Nissin Corp.* (b) | | | 107,400 | | | | 15,521 | |
| | |
Muyuan Foods Co. Ltd., Class A | | | 7,120 | | | | 36,738 | |
| | |
Nestle India Ltd. | | | 564 | | | | 164,168 | |
| | |
Nestle Malaysia Bhd. | | | 900 | | | | 23,386 | |
| | |
New Hope Liuhe Co. Ltd., Class A* | | | 9,000 | | | | 12,495 | |
| | |
NongShim Co. Ltd. | | | 56 | | | | 18,431 | |
| | |
Orion Corp. | | | 500 | | | | 44,352 | |
| | |
Orion Holdings Corp. | | | 8,037 | | | | 94,441 | |
| | |
Ottogi Corp. | | | 15 | | | | 4,159 | |
| | |
Patanjali Foods Ltd. | | | 1,030 | | | | 16,922 | |
| | |
PPB Group Bhd. | | | 14,080 | | | | 44,860 | |
| | |
QL Resources Bhd. | | | 25,395 | | | | 29,475 | |
| | |
RCL Foods Ltd.* | | | 76,845 | | | | 33,612 | |
| | |
Samyang Foods Co. Ltd. | | | 141 | | | | 19,147 | |
| | |
Samyang Holdings Corp. | | | 2,350 | | | | 118,148 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Food Products – (continued) | |
| | |
San Miguel Food and Beverage, Inc. | | | 19,470 | | | $ | 17,466 | |
| | |
Sao Martinho SA | | | 3,500 | | | | 24,603 | |
| | |
Sarawak Oil Palms Bhd. | | | 75,200 | | | | 40,248 | |
| | |
Saudia Dairy & Foodstuff Co. | | | 294 | | | | 23,510 | |
| | |
Savola Group (The) | | | 5,095 | | | | 49,434 | |
| | |
Sawit Sumbermas Sarana Tbk. PT | | | 1,311,300 | | | | 94,519 | |
| | |
Shree Renuka Sugars Ltd.* | | | 30,100 | | | | 17,606 | |
| | |
Sime Darby Plantation Bhd. | | | 52,203 | | | | 47,552 | |
| | |
SLC Agricola SA | | | 4,800 | | | | 34,989 | |
| | |
SPC Samlip Co. Ltd. | | | 940 | | | | 45,032 | |
| | |
Srinanaporn Marketing PCL, NVDR | | | 19,500 | | | | 8,789 | |
| | |
Sumber Tani Agung Resources Tbk. PT | | | 1,203,200 | | | | 65,898 | |
| | |
Taisun Enterprise Co. Ltd. | | | 94,000 | | | | 58,252 | |
| | |
Taiwan TEA Corp.* | | | 24,104 | | | | 14,714 | |
| | |
Tata Consumer Products Ltd. | | | 9,983 | | | | 107,973 | |
| | |
Thai Union Group PCL, NVDR | | | 58,800 | | | | 22,085 | |
| | |
Thai Vegetable Oil PCL, NVDR | | | 44,000 | | | | 25,830 | |
| | |
Thaifoods Group PCL, NVDR | | | 1,123,300 | | | | 100,009 | |
| | |
Tiger Brands Ltd. | | | 1,666 | | | | 15,320 | |
| | |
Tingyi Cayman Islands Holding Corp. | | | 30,000 | | | | 39,798 | |
| | |
Toly Bread Co. Ltd., Class A | | | 5,640 | | | | 6,736 | |
| | |
Tres Tentos Agroindustrial SA | | | 42,300 | | | | 92,518 | |
| | |
Triveni Engineering & Industries Ltd. | | | 4,263 | | | | 18,248 | |
| | |
Ulker Biskuvi Sanayi A/S* | | | 68,009 | | | | 174,273 | |
| | |
Uni-President Enterprises Corp. | | | 81,944 | | | | 171,543 | |
| | |
United Plantations Bhd. | | | 9,800 | | | | 34,720 | |
| | |
Universal Robina Corp. | | | 13,530 | | | | 26,063 | |
| | |
Want Want China Holdings Ltd. | | | 94,000 | | | | 58,385 | |
| | |
Yuan Longping High-tech Agriculture Co. Ltd., Class A* | | | 5,100 | | | | 11,485 | |
| | |
Zad Holding Co. | | | 3,286 | | | | 12,184 | |
| | |
Zhou Hei Ya International Holdings Co. Ltd.(a) (b) | | | 47,000 | | | | 15,497 | |
| | |
Zydus Wellnes Ltd. | | | 882 | | | | 16,221 | |
| | | | | | | 5,986,747 | |
See Accompanying Notes to the Financial Statements.
| | | | |
244 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Gas Utilities – 0.6% | |
| | |
Adani Total Gas Ltd. | | | 4,361 | | | $ | 29,557 | |
| | |
Aygaz A/S | | | 26,038 | | | | 126,451 | |
| | |
Beijing Enterprises Holdings Ltd. | | | 17,500 | | | | 58,262 | |
| | |
China Gas Holdings Ltd. | | | 84,600 | | | | 76,009 | |
| | |
China Resources Gas Group Ltd. | | | 23,400 | | | | 69,232 | |
| | |
ENN Energy Holdings Ltd. | | | 19,300 | | | | 147,378 | |
| | |
ENN Natural Gas Co. Ltd., Class A | | | 10,000 | | | | 23,585 | |
| | |
GAIL India Ltd. | | | 64,766 | | | | 92,958 | |
| | |
Grupo Energia Bogota SA ESP | | | 50,764 | | | | 20,431 | |
| | |
Gujarat Gas Ltd. | | | 2,679 | | | | 13,162 | |
| | |
Gujarat State Petronet Ltd. | | | 12,995 | | | | 41,751 | |
| | |
Indraprastha Gas Ltd. | | | 4,564 | | | | 20,959 | |
| | |
Korea Gas Corp.* | | | 999 | | | | 16,902 | |
| | |
Kunlun Energy Co. Ltd. | | | 94,000 | | | | 78,327 | |
| | |
Mahanagar Gas Ltd.(b) | | | 1,456 | | | | 18,054 | |
| | |
National Gas & Industrialization Co. | | | 1,155 | | | | 17,856 | |
| | |
Perusahaan Gas Negara Tbk. PT | | | 311,200 | | | | 24,587 | |
| | |
Petronas Gas Bhd. | | | 14,100 | | | | 50,902 | |
| | |
Promigas SA ESP | | | 122,294 | | | | 125,608 | |
| | |
Samchully Co. Ltd. | | | 799 | | | | 54,724 | |
| | |
Towngas Smart Energy Co. Ltd.(a) | | | 423,000 | | | | 175,155 | |
| | | | | | | 1,281,850 | |
|
Ground Transportation – 0.3% | |
| | |
BTS Group Holdings PCL, NVDR | | | 119,640 | | | | 24,798 | |
| | |
Container Corp. of India Ltd. | | | 4,387 | | | | 36,262 | |
| | |
Daqin Railway Co. Ltd., Class A | | | 38,400 | | | | 37,833 | |
| | |
Full Truck Alliance Co. Ltd., ADR* (a) | | | 10,105 | | | | 66,390 | |
| | |
GMexico Transportes SAB de CV(b) | | | 9,400 | | | | 19,359 | |
| | |
Grupo Traxion SAB de CV, Class A* (a) (b) | | | 9,800 | | | | 14,461 | |
| | |
Localiza Rent a Car SA | | | 11,814 | | | | 119,171 | |
| | |
Lotte Rental Co. Ltd. | | | 5,828 | | | | 110,903 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Ground Transportation – (continued) | |
| | |
Rumo SA | | | 18,800 | | | $ | 83,170 | |
| | |
SIMPAR SA | | | 117,500 | | | | 161,233 | |
| | |
Theeb Rent A Car Co. | | | 441 | | | | 7,171 | |
| | |
United International Transportation Co. | | | 996 | | | | 17,841 | |
| | |
Vamos Locacao de Caminhoes Maquinas e Equipamentos SA | | | 5,500 | | | | 8,540 | |
| | | | | | | 707,132 | |
|
Health Care Equipment & Supplies – 0.2% | |
| | |
AK Medical Holdings Ltd.(b) | | | 26,000 | | | | 25,254 | |
| | |
Beijing Chunlizhengda Medical Instruments Co. Ltd., Class H | | | 12,000 | | | | 22,115 | |
| | |
Classys, Inc. | | | 144 | | | | 3,508 | |
| | |
Dentium Co. Ltd. | | | 147 | | | | 11,875 | |
| | |
Eoflow Co. Ltd.* | | | 799 | | | | 12,838 | |
| | |
Hartalega Holdings Bhd.* | | | 30,800 | | | | 13,382 | |
| | |
HLB, Inc.* | | | 1,811 | | | | 38,815 | |
| | |
iRay Technology Co. Ltd., Class A | | | 698 | | | | 21,313 | |
| | |
Jeisys Medical, Inc.* | | | 1,942 | | | | 15,127 | |
| | |
Jiangsu Yuyue Medical Equipment & Supply Co. Ltd., Class A | | | 4,800 | | | | 22,071 | |
| | |
Kangji Medical Holdings Ltd. | | | 25,000 | | | | 20,544 | |
| | |
Kossan Rubber Industries Bhd. | | | 68,600 | | | | 19,438 | |
| | |
Lifetech Scientific Corp.* | | | 110,000 | | | | 33,740 | |
| | |
Microport Scientific Corp.* | | | 11,498 | | | | 18,074 | |
| | |
Qingdao Haier Biomedical Co. Ltd., Class A | | | 539 | | | | 2,691 | |
| | |
SD Biosensor, Inc. | | | 990 | | | | 7,066 | |
| | |
Shandong Weigao Group Medical Polymer Co. Ltd., Class H | | | 36,000 | | | | 33,356 | |
| | |
Shanghai MicroPort Endovascular MedTech Group Co. Ltd., Class A | | | 98 | | | | 2,605 | |
| | |
Sri Trang Gloves Thailand PCL, NVDR | | | 68,600 | | | | 11,165 | |
| | |
St Shine Optical Co. Ltd. | | | 2,000 | | | | 11,192 | |
| | |
Supermax Corp. Bhd. | | | 667,400 | | | | 110,661 | |
| | |
TaiDoc Technology Corp. | | | 3,000 | | | | 13,180 | |
| | |
Top Glove Corp. Bhd.* | | | 68,600 | | | | 10,439 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 245 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Visco Vision, Inc. | | | 3,264 | | | $ | 18,617 | |
| | | | | | | 499,066 | |
|
Health Care Providers & Services – 1.0% | |
| | |
Al Hammadi Holding | | | 1,862 | | | | 26,801 | |
| | |
Apollo Hospitals Enterprise Ltd. | | | 1,544 | | | | 89,383 | |
| | |
Aster DM Healthcare Ltd.* (b) | | | 6,324 | | | | 25,039 | |
| | |
Bangkok Chain Hospital PCL, NVDR | | | 20,800 | | | | 11,632 | |
| | |
Bangkok Dusit Medical Services PCL, NVDR | | | 69,200 | | | | 51,020 | |
| | |
Bumrungrad Hospital PCL, NVDR | | | 4,900 | | | | 35,446 | |
| | |
Celltrion Healthcare Co. Ltd. | | | 1,515 | | | | 74,597 | |
| | |
Chabiotech Co. Ltd.* | | | 1,200 | | | | 14,261 | |
| | |
China Meheco Co. Ltd., Class A | | | 4,700 | | | | 7,668 | |
| | |
China Resources Medical Holdings Co. Ltd. | | | 24,500 | | | | 14,435 | |
| | |
Chularat Hospital PCL, NVDR | | | 101,400 | | | | 8,915 | |
| | |
CM Hospitalar SA | | | 5,000 | | | | 14,763 | |
| | |
Dallah Healthcare Co. | | | 585 | | | | 23,078 | |
| | |
Diagnosticos da America SA* | | | 9,800 | | | | 18,831 | |
| | |
Dr Lal PathLabs Ltd.(b) | | | 822 | | | | 23,884 | |
| | |
Dr Sulaiman Al Habib Medical Services Group Co. | | | 1,355 | | | | 91,017 | |
| | |
Fleury SA | | | 89,300 | | | | 265,439 | |
| | |
Fortis Healthcare Ltd. | | | 11,121 | | | | 43,137 | |
| | |
Global Health Ltd.* | | | 2,401 | | | | 22,626 | |
| | |
Guangzhou Baiyunshan Pharmaceutical Holdings Co. Ltd., Class H | | | 12,000 | | | | 31,899 | |
| | |
Gushengtang Holdings Ltd. | | | 7,800 | | | | 46,653 | |
| | |
Hapvida Participacoes e Investimentos SA* (b) | | | 75,200 | | | | 55,024 | |
| | |
HLB Life Science Co. Ltd.* | | | 3,167 | | | | 20,894 | |
| | |
Huadong Medicine Co. Ltd., Class A | | | 3,300 | | | | 19,381 | |
| | |
Hygeia Healthcare Holdings Co. Ltd.(a) (b) | | | 6,400 | | | | 38,647 | |
| | |
IHH Healthcare Bhd. | | | 56,400 | | | | 71,025 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Providers & Services – (continued) | |
| | |
Jinxin Fertility Group Ltd.* (a) (b) | | | 73,500 | | | $ | 36,916 | |
| | |
KPJ Healthcare Bhd. | | | 49,024 | | | | 13,171 | |
| | |
Krishna Institute of Medical Sciences Ltd.* (b) | | | 1,616 | | | | 36,628 | |
| | |
Life Healthcare Group Holdings Ltd. | | | 17,346 | | | | 17,182 | |
| | |
Max Healthcare Institute Ltd. | | | 11,045 | | | | 76,113 | |
| | |
Medikaloka Hermina Tbk. PT(b) | | | 367,500 | | | | 35,281 | |
| | |
Meinian Onehealth Healthcare Holdings Co. Ltd., Class A* | | | 9,400 | | | | 7,925 | |
| | |
Metro Healthcare Indonesia Tbk. PT* | | | 286,700 | | | | 8,663 | |
| | |
Metropolis Healthcare Ltd.(b) | | | 1,104 | | | | 18,636 | |
| | |
Middle East Healthcare Co.* | | | 1,617 | | | | 29,740 | |
| | |
Mitra Keluarga Karyasehat Tbk. PT(b) | | | 100,200 | | | | 17,284 | |
| | |
MLP Saglik Hizmetleri A/S, Class B* (b) | | | 34,498 | | | | 186,435 | |
| | |
Mouwasat Medical Services Co. | | | 1,320 | | | | 35,185 | |
| | |
Narayana Hrudayalaya Ltd.(b) | | | 2,750 | | | | 32,898 | |
| | |
National Medical Care Co. | | | 931 | | | | 30,425 | |
| | |
Netcare Ltd. | | | 39,592 | | | | 27,265 | |
| | |
New Horizon Health Ltd.* (a) (b) | | | 4,000 | | | | 9,703 | |
| | |
Odontoprev SA | | | 5,390 | | | | 11,158 | |
| | |
Oncoclinicas do Brasil Servicos Medicos SA* | | | 14,400 | | | | 27,070 | |
| | |
Rainbow Children’s Medicare Ltd. | | | 2,496 | | | | 31,872 | |
| | |
Ramkhamhaeng Hospital PCL, NVDR | | | 9,300 | | | | 10,350 | |
| | |
Rede D’Or Sao Luiz SA(b) | | | 18,800 | | | | 80,598 | |
| | |
Selcuk Ecza Deposu Ticaret ve Sanayi A/S | | | 2,597 | | | | 4,870 | |
| | |
Shanghai Pharmaceuticals Holding Co. Ltd., Class A | | | 4,700 | | | | 11,580 | |
| | |
Shanghai Pharmaceuticals Holding Co. Ltd., Class H | | | 23,500 | | | | 34,178 | |
| | |
Sikarin PCL, NVDR | | | 44,000 | | | | 12,854 | |
| | |
Siloam International Hospitals Tbk. PT | | | 165,000 | | | | 24,929 | |
See Accompanying Notes to the Financial Statements.
| | | | |
246 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Providers & Services – (continued) | |
| | |
Sinopharm Group Co. Ltd., Class H | | | 37,600 | | | $ | 89,860 | |
| | |
Thonburi Healthcare Group PCL, NVDR | | | 9,300 | | | | 16,107 | |
| | |
Topchoice Medical Corp., Class A* | | | 500 | | | | 6,118 | |
| | |
Universal Vision Biotechnology Co. Ltd. | | | 2,226 | | | | 20,383 | |
| | | | | | | 2,146,872 | |
|
Health Care Technology – 0.0%(d) | |
| | |
Lunit, Inc.* | | | 329 | | | | 31,766 | |
|
Hotels, Restaurants & Leisure – 2.1% | |
| | |
Abu Dhabi National Hotels | | | 3,825,800 | | | | 1,000,978 | |
| | |
Alamar Foods | | | 539 | | | | 19,137 | |
| | |
Alsea SAB de CV* | | | 23,500 | | | | 77,765 | |
| | |
Ambassador Hotel (The) | | | 65,200 | | | | 95,081 | |
| | |
Americana Restaurants International plc | | | 39,997 | | | | 40,291 | |
| | |
Ananti, Inc.* | | | 23,453 | | | | 115,481 | |
| | |
Asset World Corp. PCL, NVDR | | | 171,900 | | | | 16,548 | |
| | |
Bloomberry Resorts Corp.* | | | 93,100 | | | | 14,948 | |
| | |
Central Plaza Hotel PCL* | | | 7,300 | | | | 9,139 | |
| | |
Chalet Hotels Ltd.* | | | 2,891 | | | | 19,016 | |
| | |
China Travel International Investment Hong Kong Ltd. | | | 122,000 | | | | 21,673 | |
| | |
DoubleUGames Co. Ltd. | | | 3,525 | | | | 108,056 | |
| | |
Easy Trip Planners Ltd.* | | | 16,003 | | | | 7,602 | |
| | |
EIH Ltd. | | | 8,250 | | | | 22,290 | |
| | |
Erawan Group PCL (The), NVDR* | | | 137,100 | | | | 19,835 | |
| | |
Genting Bhd. | | | 47,000 | | | | 39,754 | |
| | |
Genting Malaysia Bhd. | | | 61,100 | | | | 31,034 | |
| | |
Grand Korea Leisure Co. Ltd.* | | | 1,323 | | | | 15,292 | |
| | |
H World Group Ltd.* (a) | | | 23,500 | | | | 87,848 | |
| | |
Haichang Ocean Park Holdings Ltd.* (b) | | | 54,000 | | | | 6,901 | |
| | |
Haidilao International Holding Ltd.(b) | | | 21,164 | | | | 52,906 | |
| | |
Hana Tour Service, Inc.* | | | 450 | | | | 14,644 | |
| | |
Helens International Holdings Co. Ltd.(a) | | | 6,500 | | | | 4,843 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
Indian Hotels Co. Ltd., Class A | | | 13,329 | | | $ | 61,379 | |
| | |
Jahez International Co.* | | | 94 | | | | 11,050 | |
| | |
Jiumaojiu International Holdings Ltd.(a) (b) | | | 14,000 | | | | 15,208 | |
| | |
Jollibee Foods Corp. | | | 7,840 | | | | 28,326 | |
| | |
Jubilant Foodworks Ltd. | | | 4,950 | | | | 29,783 | |
| | |
Kangwon Land, Inc. | | | 2,240 | | | | 24,331 | |
| | |
Leejam Sports Co. JSC | | | 1,131 | | | | 46,306 | |
| | |
Lemon Tree Hotels Ltd.* (b) | | | 19,505 | | | | 25,734 | |
| | |
Lotte Tour Development Co. Ltd.* | | | 1,961 | | | | 15,696 | |
| | |
Magnum Bhd. | | | 446,594 | | | | 100,295 | |
| | |
Meituan, Class B* (b) | | | 68,070 | | | | 962,163 | |
| | |
Minor International PCL, NVDR | | | 48,500 | | | | 37,783 | |
| | |
MK Restaurants Group PCL, NVDR | | | 4,800 | | | | 5,409 | |
| | |
Nayuki Holdings Ltd.* (b) | | | 25,000 | | | | 12,429 | |
| | |
OPAP SA | | | 2,491 | | | | 42,128 | |
| | |
Paradise Co. Ltd.* | | | 421 | | | | 4,570 | |
| | |
Sapphire Foods India Ltd.* | | | 800 | | | | 12,447 | |
| | |
Seera Group Holding* | | | 6,332 | | | | 39,832 | |
| | |
Smartfit Escola de Ginastica e Danca SA | | | 9,400 | | | | 36,105 | |
| | |
Sports Toto Bhd. | | | 361,900 | | | | 110,139 | |
| | |
Sun International Ltd. | | | 61,194 | | | | 122,408 | |
| | |
Tongcheng Travel Holdings Ltd.* (a) (b) | | | 18,800 | | | | 35,896 | |
| | |
Travellers International Hotel Group, Inc.* ‡ | | | 209,900 | | | | — | |
| | |
TravelSky Technology Ltd., Class H | | | 21,000 | | | | 33,119 | |
| | |
Trip.com Group Ltd.* | | | 8,350 | | | | 286,849 | |
| | |
Tsogo Sun Ltd. | | | 216,341 | | | | 139,174 | |
| | |
Westlife Foodworld Ltd. | | | 3,000 | | | | 28,595 | |
| | |
Wowprime Corp. | | | 3,259 | | | | 24,014 | |
| | |
Yum China Holdings, Inc. | | | 6,439 | | | | 338,434 | |
| | |
Zomato Ltd.* | | | 78,114 | | | | 98,606 | |
| | | | | | | 4,569,270 | |
|
Household Durables – 0.9% | |
| | |
Amber Enterprises India Ltd.* | | | 935 | | | | 32,951 | |
| | |
Arcelik A/S | | | 5,782 | | | | 27,753 | |
| | |
Bajaj Electricals Ltd. | | | 2,173 | | | | 26,633 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 247 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Household Durables – (continued) | |
| | |
Coway Co. Ltd. | | | 1,153 | | | $ | 36,881 | |
| | |
Crompton Greaves Consumer Electricals Ltd. | | | 7,896 | | | | 26,744 | |
| | |
Cyrela Brazil Realty SA Empreendimentos e Participacoes | | | 103,400 | | | | 368,861 | |
| | |
Dixon Technologies India Ltd.(b) | | | 650 | | | | 39,828 | |
| | |
Eureka Forbes Ltd.* | | | 1,960 | | | | 11,759 | |
| | |
Gree Electric Appliances, Inc. of Zhuhai, Class A | | | 14,100 | | | | 65,374 | |
| | |
Haier Smart Home Co. Ltd., Class A | | | 10,600 | | | | 32,185 | |
| | |
Haier Smart Home Co. Ltd., Class H | | | 37,600 | | | | 107,640 | |
| | |
Hanssem Co. Ltd. | | | 303 | | | | 11,005 | |
| | |
Konka Group Co. Ltd., Class B* | | | 347,800 | | | | 49,783 | |
| | |
LG Electronics, Inc. | | | 2,867 | | | | 211,647 | |
| | |
LG Electronics, Inc. (Preference) | | | 584 | | | | 19,480 | |
| | |
Merry Electronics Co. Ltd. | | | 80,936 | | | | 221,086 | |
| | |
MRV Engenharia e Participacoes SA* | | | 141,000 | | | | 230,666 | |
| | |
Nien Made Enterprise Co. Ltd. | | | 3,000 | | | | 26,453 | |
| | |
PIK Group PJSC* ‡ | | | 4,646 | | | | — | |
| | |
Shenzhen MTC Co. Ltd., Class A | | | 9,600 | | | | 7,031 | |
| | |
Skyworth Group Ltd. | | | 470,000 | | | | 169,990 | |
| | |
TCL Electronics Holdings Ltd. | | | 329,000 | | | | 114,368 | |
| | |
TTK Prestige Ltd. | | | 1,825 | | | | 17,551 | |
| | |
Vestel Beyaz Esya Sanayi ve Ticaret A/S | | | 18,669 | | | | 11,066 | |
| | |
Vestel Elektronik Sanayi ve Ticaret A/S* | | | 52,264 | | | | 112,590 | |
| | |
Whirlpool of India Ltd. | | | 674 | | | | 13,294 | |
| | |
Zinus, Inc. | | | 3,567 | | | | 50,314 | |
| | | | | | | 2,042,933 | |
|
Household Products – 0.1% | |
| | |
Blue Moon Group Holdings Ltd.(b) | | | 72,000 | | | | 19,692 | |
| | |
Jyothy Labs Ltd. | | | 6,860 | | | | 29,876 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Household Products – (continued) | |
| | |
Kimberly-Clark de Mexico SAB de CV, Class A | | | 23,500 | | | $ | 43,022 | |
| | |
Unilever Indonesia Tbk. PT | | | 75,200 | | | | 17,137 | |
| | |
Vinda International Holdings Ltd. | | | 3,000 | | | | 7,415 | |
| | | | | | | 117,142 | |
|
Independent Power and Renewable Electricity Producers – 1.3% | |
| | |
Aboitiz Power Corp. | | | 34,200 | | | | 21,669 | |
| | |
Absolute Clean Energy PCL, NVDR* | | | 279,200 | | | | 11,807 | |
| | |
ACEN Corp. | | | 100,197 | | | | 9,359 | |
| | |
ACWA Power Co. | | | 1,974 | | | | 119,442 | |
| | |
Adani Green Energy Ltd.* | | | 5,358 | | | | 58,668 | |
| | |
Adani Power Ltd.* | | | 21,009 | | | | 91,610 | |
| | |
AES Brasil Energia SA* | | | 14,700 | | | | 29,353 | |
| | |
Aksa Enerji Uretim A/S, Class B | | | 3,760 | | | | 4,657 | |
| | |
Auren Energia SA | | | 5,000 | | | | 13,306 | |
| | |
B Grimm Power PCL, NVDR | | | 19,500 | | | | 11,990 | |
| | |
Bajel Projects Ltd.* | | | 2,173 | | | | 3,418 | |
| | |
Banpu Power PCL, NVDR | | | 19,300 | | | | 7,571 | |
| | |
BCPG PCL, NVDR | | | 78,300 | | | | 19,280 | |
| | |
Canvest Environmental Protection Group Co. Ltd.(b) | | | 188,000 | | | | 91,061 | |
| | |
CECEP Solar Energy Co. Ltd., Class A | | | 9,600 | | | | 7,530 | |
| | |
CGN New Energy Holdings Co. Ltd.(a) | | | 470,000 | | | | 122,537 | |
| | |
CGN Power Co. Ltd., Class A | | | 44,000 | | | | 17,857 | |
| | |
CGN Power Co. Ltd., Class H(b) | | | 329,000 | | | | 79,048 | |
| | |
China Longyuan Power Group Corp. Ltd., Class H | | | 94,000 | | | | 79,649 | |
| | |
China National Nuclear Power Co. Ltd., Class A | | | 39,900 | | | | 40,456 | |
| | |
China Power International Development Ltd.(a) | | | 141,000 | | | | 54,781 | |
| | |
China Resources Power Holdings Co. Ltd. | | | 54,000 | | | | 104,624 | |
| | |
China Three Gorges Renewables Group Co. Ltd., Class A | | | 47,000 | | | | 30,828 | |
See Accompanying Notes to the Financial Statements.
| | | | |
248 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Independent Power and Renewable Electricity Producers – (continued) | |
| | |
China Yangtze Power Co. Ltd., Class A | | | 32,900 | | | $ | 101,468 | |
| | |
CK Power PCL, NVDR | | | 112,600 | | | | 9,461 | |
| | |
Colbun SA | | | 169,153 | | | | 24,479 | |
| | |
Datang International Power Generation Co. Ltd., Class H | | | 128,000 | | | | 19,303 | |
| | |
Electricity Generating PCL, NVDR | | | 4,900 | | | | 16,632 | |
| | |
Enel Generacion Peru SAA | | | 13,072 | | | | 11,589 | |
| | |
Energy Absolute PCL, NVDR | | | 28,100 | | | | 32,836 | |
| | |
Eneva SA* | | | 18,800 | | | | 40,336 | |
| | |
Engie Brasil Energia SA | | | 4,700 | | | | 36,627 | |
| | |
First Gen Corp. | | | 136,300 | | | | 43,431 | |
| | |
Fujian Funeng Co. Ltd., Class A | | | 12,740 | | | | 14,902 | |
| | |
GD Power Development Co. Ltd., Class A | | | 42,500 | | | | 21,139 | |
| | |
Global Power Synergy PCL, NVDR | | | 13,700 | | | | 14,865 | |
| | |
Guangdong Electric Power Development Co. Ltd., Class A* | | | 4,900 | | | | 3,589 | |
| | |
Guangdong Electric Power Development Co. Ltd., Class B* | | | 67,200 | | | | 18,980 | |
| | |
Gulf Energy Development PCL, NVDR | | | 92,900 | | | | 111,788 | |
| | |
Huadian Power International Corp. Ltd., Class A | | | 26,500 | | | | 17,780 | |
| | |
Huadian Power International Corp. Ltd., Class H | | | 38,000 | | | | 15,249 | |
| | |
Huaneng Lancang River Hydropower, Inc., Class A | | | 15,000 | | | | 15,742 | |
| | |
Huaneng Power International, Inc., Class A* | | | 24,000 | | | | 24,957 | |
| | |
Huaneng Power International, Inc., Class H* (a) | | | 96,000 | | | | 44,905 | |
| | |
Hubei Energy Group Co. Ltd., Class A | | | 4,700 | | | | 2,762 | |
| | |
Inner Mongolia MengDian HuaNeng Thermal Power Corp. Ltd., Class A | | | 9,800 | | | | 4,808 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Independent Power and Renewable Electricity Producers – (continued) | |
| | |
Jilin Electric Power Co. Ltd., Class A | | | 28,800 | | | $ | 18,418 | |
| | |
JSW Energy Ltd. | | | 5,875 | | | | 27,223 | |
| | |
Malakoff Corp. Bhd. | | | 841,300 | | | | 104,180 | |
| | |
Margun Enerji Uretim Sanayi ve Ticaret A/S | | | 4,508 | | | | 9,361 | |
| | |
Mega First Corp. Bhd. | | | 249,100 | | | | 180,897 | |
| | |
NHPC Ltd. | | | 79,420 | | | | 47,885 | |
| | |
NLC India Ltd. | | | 88,830 | | | | 142,967 | |
| | |
NTPC Ltd. | | | 127,953 | | | | 362,380 | |
| | |
OGK-2 PJSC‡ | | | 11,431,280 | | | | — | |
| | |
Omega Energia SA* | | | 47,000 | | | | 70,831 | |
| | |
Ratch Group PCL, NVDR | | | 24,500 | | | | 21,983 | |
| | |
Shamal Az-Zour Al-Oula for the First Phase of Az-Zour Power Plant KSC | | | 26,687 | | | | 15,001 | |
| | |
Shandong Hi-Speed New Energy Group Ltd.* | | | 207,600 | | | | 67,391 | |
| | |
Shanghai Electric Power Co. Ltd., Class A | | | 10,000 | | | | 11,943 | |
| | |
Shenergy Co. Ltd., Class A | | | 4,900 | | | | 3,944 | |
| | |
Shenzhen Energy Group Co. Ltd., Class A | | | 10,600 | | | | 8,951 | |
| | |
Sichuan Chuantou Energy Co. Ltd., Class A | | | 9,400 | | | | 18,895 | |
| | |
Super Energy Corp. PCL, NVDR* | | | 431,200 | | | | 5,159 | |
| | |
Terna Energy SA | | | 1,276 | | | | 19,138 | |
| | |
TPI Polene Power PCL, NVDR | | | 1,018,800 | | | | 93,539 | |
| | |
Unipro PJSC* ‡ | | | 5,337,000 | | | | — | |
| | |
Wintime Energy Group Co. Ltd., Class A* | | | 76,800 | | | | 14,377 | |
| | |
Xinyi Energy Holdings Ltd. | | | 3,265 | | | | 572 | |
| | |
Zhejiang Zheneng Electric Power Co. Ltd., Class A* | | | 28,800 | | | | 17,946 | |
| | |
Zorlu Enerji Elektrik Uretim A/S* | | | 49,256 | | | | 9,227 | |
| | | | | | | 2,950,337 | |
|
Industrial Conglomerates – 2.3% | |
| | |
3M India Ltd. | | | 69 | | | | 24,666 | |
| | |
Aamal Co. | | | 550,652 | | | | 124,165 | |
| | |
Aboitiz Equity Ventures, Inc. | | | 64,390 | | | | 51,975 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 249 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – (continued) | |
| | |
AG Anadolu Grubu Holding A/S | | | 3,478 | | | $ | 25,250 | |
| | |
Alarko Holding A/S | | | 2,646 | | | | 9,464 | |
| | |
Alfa SAB de CV, Class A | | | 89,300 | | | | 55,599 | |
| | |
Alliance Global Group, Inc. | | | 56,400 | | | | 10,536 | |
| | |
Alpha Dhabi Holding PJSC* | | | 39,433 | | | | 202,694 | |
| | |
AntarChile SA | | | 3,206 | | | | 25,886 | |
| | |
Apar Industries Ltd. | | | 637 | | | | 39,627 | |
| | |
Astra Industrial Group | | | 1,753 | | | | 42,521 | |
| | |
Astra International Tbk. PT | | | 549,900 | | | | 199,916 | |
| | |
Ayala Corp. | | | 4,030 | | | | 43,006 | |
| | |
Bidvest Group Ltd. (The) | | | 5,033 | | | | 70,825 | |
| | |
China Baoan Group Co. Ltd., Class A | | | 5,500 | | | | 7,764 | |
| | |
CITIC Ltd. | | | 188,000 | | | | 159,778 | |
| | |
CJ Corp. | | | 343 | | | | 21,359 | |
| | |
DMCI Holdings, Inc. | | | 121,000 | | | | 19,555 | |
| | |
Doosan Co. Ltd. | | | 352 | | | | 19,391 | |
| | |
Dubai Investments PJSC | | | 38,220 | | | | 23,517 | |
| | |
Far Eastern New Century Corp. | | | 94,000 | | | | 85,494 | |
| | |
Fosun International Ltd. | | | 48,000 | | | | 28,709 | |
| | |
Godrej Industries Ltd.* | | | 3,377 | | | | 25,502 | |
| | |
Grupo Carso SAB de CV, Series A1 | | | 9,400 | | | | 59,858 | |
| | |
GS Holdings Corp. | | | 1,200 | | | | 35,008 | |
| | |
GT Capital Holdings, Inc. | | | 2,400 | | | | 23,222 | |
| | |
Hanwha Corp. | | | 1,692 | | | | 27,813 | |
| | |
HAP Seng Consolidated Bhd. | | | 11,900 | | | | 12,263 | |
| | |
Hong Leong Industries Bhd. | | | 9,800 | | | | 18,512 | |
| | |
Hosken Consolidated Investments Ltd. | | | 17,202 | | | | 178,949 | |
| | |
Hyosung Corp. | | | 201 | | | | 8,781 | |
| | |
Industries Qatar QSC | | | 30,540 | | | | 102,499 | |
| | |
International Holding Co. PJSC* | | | 13,301 | | | | 1,447,068 | |
| | |
JG Summit Holdings, Inc. | | | 34,311 | | | | 22,223 | |
| | |
KOC Holding A/S | | | 34,451 | | | | 166,576 | |
| | |
LG Corp. | | | 3,055 | | | | 174,630 | |
| | |
Lotte Corp. | | | 1,392 | | | | 26,798 | |
| | |
LT Group, Inc. | | | 98,000 | | | | 15,286 | |
| | |
LX Holdings Corp. | | | 752 | | | | 3,758 | |
| | |
Multiply Group PJSC* | | | 96,713 | | | | 89,525 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Industrial Conglomerates – (continued) | |
| | |
Mytilineos SA | | | 2,685 | | | $ | 99,275 | |
| | |
National Industries Group Holding SAK | | | 35,856 | | | | 20,618 | |
| | |
Quinenco SA | | | 8,136 | | | | 21,950 | |
| | |
Reunert Ltd. | | | 65,659 | | | | 205,555 | |
| | |
Samsung C&T Corp. | | | 2,450 | | | | 193,562 | |
| | |
San Miguel Corp. | | | 13,510 | | | | 25,025 | |
| | |
Shanghai Industrial Holdings Ltd. | | | 146,000 | | | | 178,568 | |
| | |
Siemens Ltd. | | | 1,281 | | | | 51,249 | |
| | |
Sigdo Koppers SA | | | 111,860 | | | | 146,805 | |
| | |
Sime Darby Bhd. | | | 79,800 | | | | 38,355 | |
| | |
SK Square Co. Ltd.* | | | 2,820 | | | | 88,846 | |
| | |
SK, Inc. | | | 1,034 | | | | 108,717 | |
| | |
SM Investments Corp. | | | 7,990 | | | | 112,795 | |
| | |
Sunway Bhd. | | | 44,100 | | | | 17,124 | |
| | |
Turkiye Sise ve Cam Fabrikalari A/S | | | 34,639 | | | | 57,959 | |
| | | | | | | 5,096,371 | |
|
Industrial REITs – 0.5% | |
| | |
Equites Property Fund Ltd., REIT(a) | | | 327,355 | | | | 199,938 | |
| | |
ESR Kendall Square REIT Co. Ltd., REIT | | | 3,896 | | | | 9,231 | |
| | |
FIBRA Macquarie Mexico, REIT(b) | | | 286,700 | | | | 443,716 | |
| | |
Prologis Property Mexico SA de CV, REIT(a) | | | 9,400 | | | | 33,642 | |
| | |
TF Administradora Industrial S de RL de CV, REIT | | | 305,500 | | | | 495,149 | |
| | | | | | | 1,181,676 | |
|
Insurance – 2.9% | |
| | |
Abu Dhabi National Insurance Co. PSC | | | 111,437 | | | | 182,947 | |
| | |
Al Rajhi Co. for Co-operative Insurance* | | | 705 | | | | 27,962 | |
| | |
Allianz Malaysia Bhd. | | | 23,500 | | | | 79,016 | |
| | |
Anadolu Anonim Turk Sigorta Sirketi* | | | 63,920 | | | | 133,069 | |
| | |
Bangkok Insurance PCL, NVDR | | | 9,400 | | | | 78,197 | |
| | |
Bangkok Life Assurance PCL, NVDR | | | 19,600 | | | | 12,651 | |
See Accompanying Notes to the Financial Statements.
| | | | |
250 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
BB Seguridade Participacoes SA | | | 9,400 | | | $ | 57,336 | |
| | |
Bupa Arabia for Cooperative Insurance Co. | | | 327 | | | | 18,566 | |
| | |
Caixa Seguridade Participacoes SA | | | 15,000 | | | | 32,183 | |
| | |
Capital Financial Indonesia Tbk. PT* | | | 156,800 | | | | 5,478 | |
| | |
Cathay Financial Holding Co. Ltd. | | | 262,552 | | | | 355,358 | |
| | |
Central Reinsurance Co. Ltd.* | | | 13,263 | | | | 9,180 | |
| | |
China Development Financial Holding Corp.* | | | 470,000 | | | | 163,743 | |
| | |
China Life Insurance Co. Ltd., Class H | | | 191,000 | | | | 258,748 | |
| | |
China Pacific Insurance Group Co. Ltd., Class A | | | 18,600 | | | | 70,531 | |
| | |
China Pacific Insurance Group Co. Ltd., Class H | | | 65,800 | | | | 162,133 | |
| | |
China Taiping Insurance Holdings Co. Ltd. | | | 31,800 | | | | 29,343 | |
| | |
Co. for Cooperative Insurance (The) | | | 1,168 | | | | 37,609 | |
| | |
DB Insurance Co. Ltd. | | | 1,363 | | | | 88,710 | |
| | |
Dhipaya Group Holdings PCL, NVDR | | | 14,600 | | | | 13,811 | |
| | |
Discovery Ltd. | | | 8,046 | | | | 55,185 | |
| | |
Fubon Financial Holding Co. Ltd. | | | 232,496 | | | | 430,800 | |
| | |
General Insurance Corp. of India(b) | | | 7,546 | | | | 20,669 | |
| | |
Hanwha Life Insurance Co. Ltd.* | | | 12,318 | | | | 25,264 | |
| | |
HDFC Life Insurance Co. Ltd.(b) | | | 15,980 | | | | 118,681 | |
| | |
Hyundai Marine & Fire Insurance Co. Ltd. | | | 1,262 | | | | 29,435 | |
| | |
ICICI Lombard General Insurance Co. Ltd.(b) | | | 3,465 | | | | 57,174 | |
| | |
ICICI Prudential Life Insurance Co. Ltd.(b) | | | 5,552 | | | | 35,026 | |
| | |
Korean Reinsurance Co. | | | 33,511 | | | | 220,090 | |
| | |
LPI Capital Bhd. | | | 4,900 | | | | 12,321 | |
| | |
Max Financial Services Ltd.* | | | 2,721 | | | | 29,874 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Insurance – (continued) | |
| | |
Mercuries & Associates Holding Ltd.* | | | 165,975 | | | $ | 64,476 | |
| | |
Mercuries Life Insurance Co. Ltd.* | | | 147,000 | | | | 22,842 | |
| | |
Mirae Asset Life Insurance Co. Ltd.* | | | 15,604 | | | | 58,347 | |
| | |
Momentum Metropolitan Holdings | | | 39,089 | | | | 43,724 | |
| | |
New China Life Insurance Co. Ltd., Class A | | | 4,700 | | | | 21,451 | |
| | |
New China Life Insurance Co. Ltd., Class H | | | 23,500 | | | | 51,477 | |
| | |
Old Mutual Ltd. | | | 123,046 | | | | 77,778 | |
| | |
OUTsurance Group Ltd. | | | 10,487 | | | | 22,555 | |
| | |
PB Fintech Ltd.* | | | 4,982 | | | | 41,928 | |
| | |
People’s Insurance Co. Group of China Ltd. (The), Class H | | | 217,000 | | | | 71,551 | |
| | |
PICC Property & Casualty Co. Ltd., Class H | | | 188,000 | | | | 214,800 | |
| | |
Ping An Insurance Group Co. of China Ltd., Class A | | | 23,600 | | | | 146,603 | |
| | |
Ping An Insurance Group Co. of China Ltd., Class H | | | 171,000 | | | | 876,352 | |
| | |
Porto Seguro SA* | | | 5,000 | | | | 24,995 | |
| | |
Qatar Insurance Co. SAQ* | | | 638,166 | | | | 431,871 | |
| | |
Qualitas Controladora SAB de CV | | | 4,700 | | | | 38,768 | |
| | |
Samsung Fire & Marine Insurance Co. Ltd. | | | 955 | | | | 182,790 | |
| | |
Samsung Life Insurance Co. Ltd. | | | 2,444 | | | | 130,836 | |
| | |
Sanlam Ltd. | | | 46,765 | | | | 163,068 | |
| | |
Santam Ltd.(a) | | | 723 | | | | 10,532 | |
| | |
SBI Life Insurance Co. Ltd.(b) | | | 7,078 | | | | 116,284 | |
| | |
Shin Kong Financial Holding Co. Ltd.* | | | 423,000 | | | | 113,330 | |
| | |
Shinkong Insurance Co. Ltd. | | | 91,856 | | | | 188,895 | |
| | |
Star Health & Allied Insurance Co. Ltd.* | | | 1,470 | | | | 10,240 | |
| | |
Syarikat Takaful Malaysia Keluarga Bhd. | | | 235,000 | | | | 181,509 | |
| | |
Thai Life Insurance PCL, NVDR | | | 63,600 | | | | 19,641 | |
| | |
Tongyang Life Insurance Co. Ltd.* | | | 12,850 | | | | 41,722 | |
| | |
Waterdrop, Inc., ADR* | | | 7,350 | | | | 7,571 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 251 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
ZhongAn Online P&C Insurance Co. Ltd., Class H* (a) (b) | | | 11,000 | | | $ | 30,155 | |
| | | | | | | 6,257,181 | |
|
Interactive Media & Services – 2.6% | |
| | |
AfreecaTV Co. Ltd. | | | 275 | | | | 13,622 | |
| | |
Autohome, Inc., Class A(a) | | | 5,000 | | | | 32,621 | |
| | |
Baidu, Inc., Class A* | | | 35,250 | | | | 462,666 | |
| | |
Connectwave Co. Ltd.* | | | 882 | | | | 6,772 | |
| | |
Info Edge India Ltd. | | | 1,266 | | | | 62,104 | |
| | |
JOYY, Inc., ADR | | | 17,625 | | | | 685,965 | |
| | |
Kakao Corp. | | | 4,794 | | | | 134,177 | |
| | |
Kuaishou Technology* (b) | | | 37,600 | | | | 241,950 | |
| | |
Meitu, Inc.* (a) (b) | | | 98,000 | | | | 39,202 | |
| | |
NAVER Corp. | | | 2,303 | | | | 319,560 | |
| | |
Tencent Holdings Ltd. | | | 97,400 | | | | 3,599,939 | |
| | |
Weibo Corp., Class A(a) | | | 1,960 | | | | 22,983 | |
| | | | | | | 5,621,561 | |
|
IT Services – 1.3% | |
| | |
Al Moammar Information Systems Co. | | | 505 | | | | 18,307 | |
| | |
Arabian Internet & Communications Services Co. | | | 551 | | | | 45,941 | |
| | |
Chinasoft International Ltd. | | | 46,000 | | | | 33,333 | |
| | |
Chindata Group Holdings Ltd., ADR* (a) | | | 7,285 | | | | 64,691 | |
| | |
Coforge Ltd. | | | 987 | | | | 59,086 | |
| | |
Elm Co. | | | 336 | | | | 62,801 | |
| | |
GDS Holdings Ltd., Class A* | | | 14,700 | | | | 18,186 | |
| | |
Happiest Minds Technologies Ltd. | | | 2,940 | | | | 28,931 | |
| | |
HCL Technologies Ltd. | | | 16,309 | | | | 249,947 | |
| | |
Hyundai Autoever Corp. | | | 94 | | | | 9,048 | |
| | |
Infosys Ltd. | | | 55,294 | | | | 908,785 | |
| | |
Jasmine Technology Solution PCL, NVDR* | | | 4,100 | | | | 3,793 | |
| | |
LTIMindtree Ltd.(b) | | | 1,408 | | | | 85,577 | |
| | |
Mphasis Ltd. | | | 833 | | | | 21,244 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
IT Services – (continued) | |
| | |
Perfect Presentation For Commercial Services Co. | | | 1,715 | | | $ | 9,417 | |
| | |
Persistent Systems Ltd. | | | 884 | | | | 65,406 | |
| | |
Posco DX Co. Ltd. | | | 816 | | | | 29,636 | |
| | |
Samsung SDS Co. Ltd. | | | 1,128 | | | | 115,427 | |
| | |
Sonata Software Ltd. | | | 2,795 | | | | 38,728 | |
| | |
Systex Corp. | | | 13,000 | | | | 40,080 | |
| | |
Tata Consultancy Services Ltd. | | | 15,745 | | | | 637,062 | |
| | |
Tech Mahindra Ltd. | | | 10,058 | | | | 136,889 | |
| | |
Wipro Ltd. | | | 20,539 | | | | 94,186 | |
| | | | | | | 2,776,501 | |
|
Leisure Products – 0.2% | |
| | |
Advanced International Multitech Co. Ltd. | | | 47,000 | | | | 96,072 | |
| | |
Ferretti SpA | | | 32,900 | | | | 96,287 | |
| | |
Fusheng Precision Co. Ltd. | | | 4,416 | | | | 27,570 | |
| | |
Giant Manufacturing Co. Ltd. | | | 5,181 | | | | 26,037 | |
| | |
GOLFZON Co. Ltd. | | | 1,645 | | | | 105,968 | |
| | |
Johnson Health Tech Co. Ltd. | | | 2,000 | | | | 4,064 | |
| | |
Merida Industry Co. Ltd. | | | 5,350 | | | | 27,298 | |
| | |
Topkey Corp. | | | 3,456 | | | | 17,155 | |
| | | | | | | 400,451 | |
|
Life Sciences Tools & Services – 0.2% | |
| | |
Divi’s Laboratories Ltd. | | | 1,927 | | | | 78,422 | |
| | |
EirGenix, Inc.* | | | 6,144 | | | | 20,174 | |
| | |
Genscript Biotech Corp.* | | | 20,000 | | | | 58,022 | |
| | |
Hangzhou Tigermed Consulting Co. Ltd., Class H(b) | | | 4,900 | | | | 27,523 | |
| | |
LegoChem Biosciences, Inc.* | | | 1,224 | | | | 33,488 | |
| | |
Samsung Biologics Co. Ltd.* (b) | | | 282 | | | | 148,042 | |
| | |
ST Pharm Co. Ltd. | | | 141 | | | | 7,099 | |
| | |
Syngene International Ltd.(b) | | | 1,400 | | | | 11,439 | |
| | |
WuXi AppTec Co. Ltd., Class A | | | 4,060 | | | | 47,995 | |
| | |
WuXi AppTec Co. Ltd., Class H(a) (b) | | | 4,718 | | | | 56,679 | |
| | | | | | | 488,883 | |
|
Machinery – 0.8% | |
| | |
AIA Engineering Ltd. | | | 600 | | | | 25,335 | |
| | |
Airtac International Group | | | 1,913 | | | | 62,518 | |
| | |
Ashok Leyland Ltd. | | | 29,258 | | | | 58,932 | |
See Accompanying Notes to the Financial Statements.
| | | | |
252 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
China CSSC Holdings Ltd., Class A | | | 5,900 | | | $ | 20,865 | |
| | |
China International Marine Containers Group Co. Ltd., Class A | | | 9,600 | | | | 8,684 | |
| | |
China International Marine Containers Group Co. Ltd., Class H | | | 9,400 | | | | 4,949 | |
| | |
CIMC Enric Holdings Ltd. | | | 30,000 | | | | 25,458 | |
| | |
Cochin Shipyard Ltd.(b) | | | 1,536 | | | | 17,551 | |
| | |
Craftsman Automation Ltd. | | | 343 | | | | 20,058 | |
| | |
Creative & Innovative System* | | | 2,703 | | | | 17,953 | |
| | |
CSBC Corp. Taiwan* | | | 25,144 | | | | 15,621 | |
| | |
Cummins India Ltd. | | | 2,280 | | | | 45,911 | |
| | |
Doosan Bobcat, Inc. | | | 1,222 | | | | 35,062 | |
| | |
Elgi Equipments Ltd. | | | 8,504 | | | | 51,616 | |
| | |
Enplus Co. Ltd.* | | | 2,695 | | | | 8,082 | |
| | |
Escorts Kubota Ltd. | | | 564 | | | | 21,220 | |
| | |
GMM Pfaudler Ltd. | | | 490 | | | | 10,211 | |
| | |
Grindwell Norton Ltd. | | | 771 | | | | 19,858 | |
| | |
Haitian International Holdings Ltd. | | | 16,000 | | | | 38,116 | |
| | |
Hana Technology Co. Ltd.* | | | 245 | | | | 11,882 | |
| | |
Hanwha Ocean Co. Ltd.* | | | 705 | | | | 12,319 | |
| | |
HD Hyundai Construction Equipment Co. Ltd. | | | 392 | | | | 12,916 | |
| | |
HD Hyundai Heavy Industries Co. Ltd.* | | | 282 | | | | 21,319 | |
| | |
HD Hyundai Infracore Co. Ltd. | | | 3,822 | | | | 18,932 | |
| | |
HD Korea Shipbuilding & Offshore Engineering Co. Ltd.* | | | 1,269 | | | | 84,847 | |
| | |
Hiwin Technologies Corp. | | | 5,535 | | | | 33,362 | |
| | |
Hyundai Elevator Co. Ltd. | | | 882 | | | | 28,212 | |
| | |
Hyundai Mipo Dockyard Co. Ltd.* | | | 400 | | | | 20,525 | |
| | |
Hyundai Rotem Co. Ltd.* | | | 1,175 | | | | 20,228 | |
| | |
Jiangsu Hengli Hydraulic Co. Ltd., Class A | | | 2,500 | | | | 19,233 | |
| | |
Kangwon Energy Co. Ltd.* | | | 637 | | | | 8,584 | |
| | |
Kaori Heat Treatment Co. Ltd. | | | 3,640 | | | | 23,455 | |
| | |
Kinik Co. | | | 6,000 | | | | 30,060 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Machinery – (continued) | |
| | |
KSB Ltd. | | | 539 | | | $ | 19,820 | |
| | |
Lakshmi Machine Works Ltd. | | | 282 | | | | 44,723 | |
| | |
LK Technology Holdings Ltd. | | | 22,000 | | | | 18,866 | |
| | |
Ningbo Deye Technology Co. Ltd., Class A | | | 900 | | | | 8,501 | |
| | |
Otokar Otomotiv ve Savunma Sanayi A/S* | | | 2,058 | | | | 29,059 | |
| | |
Pentamaster Corp. Bhd. | | | 21,200 | | | | 22,248 | |
| | |
People & Technology, Inc. | | | 441 | | | | 16,049 | |
| | |
Rainbow Robotics* | | | 144 | | | | 15,034 | |
| | |
Sam Engineering & Equipment M Bhd. | | | 4,700 | | | | 4,271 | |
| | |
Samsung Heavy Industries Co. Ltd.* | | | 10,763 | | | | 54,351 | |
| | |
Sany Heavy Equipment International Holdings Co. Ltd. | | | 12,000 | | | | 15,766 | |
| | |
Sany Heavy Industry Co. Ltd., Class A | | | 14,100 | | | | 27,880 | |
| | |
Schaeffler India Ltd. | | | 846 | | | | 28,628 | |
| | |
SFA Engineering Corp. | | | 704 | | | | 14,517 | |
| | |
Shanghai Zhenhua Heavy Industries Co. Ltd., Class B* | | | 96,000 | | | | 19,392 | |
| | |
Sinotruk Hong Kong Ltd. | | | 23,500 | | | | 44,209 | |
| | |
SK oceanplant Co. Ltd.* | | | 1,219 | | | | 14,478 | |
| | |
SKF India Ltd. | | | 385 | | | | 22,707 | |
| | |
Sunonwealth Electric Machine Industry Co. Ltd. | | | 8,464 | | | | 22,703 | |
| | |
Thermax Ltd. | | | 944 | | | | 32,106 | |
| | |
Tian Di Science & Technology Co. Ltd., Class A | | | 4,900 | | | | 3,455 | |
| | |
Timken India Ltd. | | | 329 | | | | 11,463 | |
| | |
Turk Traktor ve Ziraat Makineleri A/S | | | 793 | | | | 20,315 | |
| | |
UWC Bhd.* | | | 20,400 | | | | 15,628 | |
| | |
Waffer Technology Corp. | | | 5,280 | | | | 17,581 | |
| | |
Weichai Power Co. Ltd., Class A | | | 23,500 | | | | 44,572 | |
| | |
Weichai Power Co. Ltd., Class H | | | 47,000 | | | | 70,278 | |
| | |
XCMG Construction Machinery Co. Ltd., Class A | | | 28,800 | | | | 22,550 | |
| | |
Yangzijiang Shipbuilding Holdings Ltd. | | | 70,500 | | | | 74,614 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 253 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
Zhejiang Sanhua Intelligent Controls Co. Ltd., Class A | | | 4,800 | | | $ | 17,539 | |
| | |
Zhengzhou Coal Mining Machinery Group Co. Ltd., Class H | | | 10,000 | | | | 9,432 | |
| | |
Zhuzhou CRRC Times Electric Co. Ltd., Class H | | | 11,600 | | | | 37,433 | |
| | |
Zoomlion Heavy Industry Science and Technology Co. Ltd., Class A | | | 17,700 | | | | 15,528 | |
| | |
Zoomlion Heavy Industry Science and Technology Co. Ltd., Class H | | | 29,200 | | | | 15,151 | |
| | | | | | | 1,704,721 | |
|
Marine Transportation – 0.4% | |
| | |
Cia Sud Americana de Vapores SA | | | 402,367 | | | | 22,272 | |
| | |
COSCO SHIPPING Holdings Co. Ltd., Class H | | | 94,000 | | | | 95,507 | |
| | |
Evergreen Marine Corp. Taiwan Ltd. | | | 29,023 | | | | 96,192 | |
| | |
Far-Eastern Shipping Co. plc* ‡ | | | 302,500 | | | | — | |
| | |
HMM Co. Ltd. | | | 6,251 | | | | 67,437 | |
| | |
Korea Line Corp.* | | | 57,669 | | | | 71,310 | |
| | |
Log-in Logistica Intermodal SA* | | | 2,112 | | | | 17,104 | |
| | |
MISC Bhd. | | | 22,400 | | | | 34,085 | |
| | |
Orient Overseas International Ltd.(a) | | | 3,500 | | | | 44,127 | |
| | |
Pan Ocean Co. Ltd. | | | 6,321 | | | | 20,125 | |
| | |
Precious Shipping PCL, NVDR | | | 305,500 | | | | 71,397 | |
| | |
Qatar Navigation QSC | | | 18,292 | | | | 45,270 | |
| | |
Regional Container Lines PCL, NVDR | | | 89,200 | | | | 48,642 | |
| | |
Shanghai Zhonggu Logistics Co. Ltd., Class A | | | 7,252 | | | | 9,384 | |
| | |
Shipping Corp. of India Land & Assets Ltd.* ‡ | | | 61,005 | | | | 23,403 | |
| | |
Temas Tbk. PT | | | 4,107,800 | | | | 40,082 | |
| | |
Transcoal Pacific Tbk. PT | | | 14,100 | | | | 7,745 | |
| | |
U-Ming Marine Transport Corp. | | | 14,000 | | | | 19,121 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Marine Transportation – (continued) | |
| | |
Wan Hai Lines Ltd. | | | 47,000 | | | $ | 66,946 | |
| | |
Wisdom Marine Lines Co. Ltd. | | | 11,898 | | | | 15,297 | |
| | |
Yang Ming Marine Transport Corp. | | | 50,000 | | | | 64,899 | |
| | | | | | | 880,345 | |
|
Media – 0.3% | |
| | |
Affle India Ltd.* | | | 2,401 | | | | 30,319 | |
| | |
Arabian Contracting Services Co. | | | 588 | | | | 31,629 | |
| | |
Astro Malaysia Holdings Bhd. | | | 1,095,100 | | | | 95,386 | |
| | |
Cheil Worldwide, Inc. | | | 1,392 | | | | 20,469 | |
| | |
China Literature Ltd.* (b) | | | 6,200 | | | | 20,879 | |
| | |
China South Publishing & Media Group Co. Ltd., Class A | | | 14,200 | | | | 21,985 | |
| | |
Chinese Universe Publishing and Media Group Co. Ltd., Class A | | | 12,600 | | | | 19,921 | |
| | |
Elang Mahkota Teknologi Tbk. PT | | | 648,000 | | | | 20,396 | |
| | |
Focus Media Information Technology Co. Ltd., Class A | | | 23,500 | | | | 22,222 | |
| | |
Grupo Televisa SAB, Series CPO(a) | | | 48,514 | | | | 22,224 | |
| | |
Innocean Worldwide, Inc. | | | 3,384 | | | | 109,246 | |
| | |
Megacable Holdings SAB de CV(a) | | | 14,100 | | | | 27,539 | |
| | |
MultiChoice Group* | | | 7,200 | | | | 26,811 | |
| | |
Network18 Media & Investments Ltd.* | | | 80,934 | | | | 66,296 | |
| | |
Saudi Research & Media Group* | | | 605 | | | | 22,738 | |
| | |
Surya Citra Media Tbk. PT | | | 11,801,700 | | | | 112,185 | |
| | |
TY Holdings Co. Ltd. | | | 5,232 | | | | 20,300 | |
| | |
VGI PCL, NVDR | | | 127,300 | | | | 6,800 | |
| | |
Zee Entertainment Enterprises Ltd.* | | | 16,732 | | | | 52,090 | |
| | | | | | | 749,435 | |
|
Metals & Mining – 5.0% | |
| | |
Adaro Minerals Indonesia Tbk. PT* | | | 120,400 | | | | 8,337 | |
| | |
African Rainbow Minerals Ltd. | | | 3,744 | | | | 30,672 | |
See Accompanying Notes to the Financial Statements.
| | | | |
254 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Al Masane Al Kobra Mining Co. | | | 1,403 | | | $ | 19,708 | |
| | |
Alrosa PJSC‡ | | | 85,800 | | | | — | |
| | |
Aluminum Corp. of China Ltd., Class A | | | 4,800 | | | | 4,067 | |
| | |
Aluminum Corp. of China Ltd., Class H | | | 94,000 | | | | 50,336 | |
| | |
Aneka Tambang Tbk. | | | 201,400 | | | | 21,617 | |
| | |
Angang Steel Co. Ltd., Class H | | | 38,000 | | | | 8,353 | |
| | |
Anglo American Platinum Ltd. | | | 1,410 | | | | 46,933 | |
| | |
Anglogold Ashanti plc | | | 6,533 | | | | 120,053 | |
| | |
APL Apollo Tubes Ltd. | | | 3,225 | | | | 60,631 | |
| | |
Baoshan Iron & Steel Co. Ltd., Class A | | | 56,400 | | | | 48,245 | |
| | |
Beijing Shougang Co. Ltd., Class A* | | | 10,600 | | | | 5,620 | |
| | |
Borusan Mannesmann Boru Sanayi ve Ticaret A/S* | | | 14,852 | | | | 484,520 | |
| | |
Bradespar SA | | | 14,100 | | | | 57,261 | |
| | |
Bradespar SA (Preference) | | | 98,700 | | | | 437,231 | |
| | |
Bumi Resources Minerals Tbk. PT* | | | 1,235,000 | | | | 15,083 | |
| | |
CAP SA | | | 26,743 | | | | 145,703 | |
| | |
Century Iron & Steel Industrial Co. Ltd. | | | 6,000 | | | | 27,840 | |
| | |
China Gold International Resources Corp. Ltd. | | | 4,900 | | | | 20,916 | |
| | |
China Hongqiao Group Ltd.(a) | | | 70,500 | | | | 65,954 | |
| | |
China Metal Recycling Holdings Ltd.* ‡ | | | 51,000 | | | | — | |
| | |
China Nonferrous Mining Corp. Ltd. | | | 49,000 | | | | 29,746 | |
| | |
China Northern Rare Earth Group High-Tech Co. Ltd., Class A | | | 5,300 | | | | 15,136 | |
| | |
China Steel Corp. | | | 194,000 | | | | 144,446 | |
| | |
China Zhongwang Holdings Ltd.* ‡ | | | 699,600 | | | | — | |
| | |
Chung Hung Steel Corp. | | | 23,000 | | | | 15,281 | |
| | |
Cia de Ferro Ligas da Bahia FERBASA (Preference) | | | 14,100 | | | | 135,967 | |
| | |
Cia Siderurgica Nacional SA | | | 18,800 | | | | 43,841 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Citic Pacific Special Steel Group Co. Ltd., Class A | | | 10,600 | | | $ | 21,017 | |
| | |
CMOC Group Ltd., Class A | | | 43,200 | | | | 32,704 | |
| | |
CMOC Group Ltd., Class H | | | 102,000 | | | | 60,747 | |
| | |
Dongkuk Holdings Co. Ltd. | | | 3,869 | | | | 24,666 | |
| | |
DRDGOLD Ltd. | | | 10,054 | | | | 8,806 | |
| | |
Eregli Demir ve Celik Fabrikalari TAS* | | | 38,728 | | | | 51,824 | |
| | |
EVERGREEN Steel Corp. | | | 87,896 | | | | 191,049 | |
| | |
Ezz Steel Co. SAE* | | | 74,166 | | | | 179,653 | |
| | |
Feng Hsin Steel Co. Ltd. | | | 15,408 | | | | 29,880 | |
| | |
GEM Co. Ltd., Class A | | | 28,800 | | | | 23,062 | |
| | |
Gerdau SA (Preference) | | | 29,670 | | | | 128,082 | |
| | |
Gloria Material Technology Corp. | | | 19,352 | | | | 26,610 | |
| | |
Gold Fields Ltd. | | | 14,100 | | | | 186,880 | |
| | |
Grupo Mexico SAB de CV, Series B | | | 84,600 | | | | 344,576 | |
| | |
Harmony Gold Mining Co. Ltd. | | | 14,133 | | | | 65,113 | |
| | |
Henan Shenhuo Coal & Power Co. Ltd., Class A | | | 5,500 | | | | 12,378 | |
| | |
Hesteel Co. Ltd., Class A | | | 37,600 | | | | 11,509 | |
| | |
Hindalco Industries Ltd. | | | 39,668 | | | | 218,925 | |
| | |
Hindustan Copper Ltd. | | | 16,483 | | | | 28,350 | |
| | |
Hsin Kuang Steel Co. Ltd. | | | 12,144 | | | | 17,448 | |
| | |
Huaibei Mining Holdings Co. Ltd., Class A | | | 9,400 | | | | 18,856 | |
| | |
Hunan Valin Steel Co. Ltd., Class A | | | 23,500 | | | | 18,721 | |
| | |
Hyundai Steel Co. | | | 2,023 | | | | 49,057 | |
| | |
Impala Platinum Holdings Ltd. | | | 24,182 | | | | 100,201 | |
| | |
Industrias CH SAB de CV, Class B, Series B* | | | 1,147 | | | | 12,262 | |
| | |
Industrias Penoles SAB de CV* (a) | | | 2,585 | | | | 28,820 | |
| | |
Inner Mongolia BaoTou Steel Union Co. Ltd., Class A* | | | 70,500 | | | | 15,607 | |
| | |
Inner Mongolia ERDOS Resources Co. Ltd., Class A | | | 6,272 | | | | 8,013 | |
| | |
Inner Mongolia ERDOS Resources Co. Ltd., Class B | | | 10,388 | | | | 9,412 | |
| | |
Jiangxi Copper Co. Ltd., Class A | | | 9,400 | | | | 23,570 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 255 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Jiangxi Copper Co. Ltd., Class H | | | 31,000 | | | $ | 43,897 | |
| | |
Jinchuan Group International Resources Co. Ltd.(a) | | | 752,000 | | | | 45,651 | |
| | |
Jindal Stainless Ltd. | | | 134,420 | | | | 714,490 | |
| | |
Jindal Steel & Power Ltd. | | | 10,058 | | | | 76,566 | |
| | |
JSW Steel Ltd. | | | 14,382 | | | | 127,196 | |
| | |
Kardemir Karabuk Demir Celik Sanayi ve Ticaret A/S, Class A | | | 4,508 | | | | 3,394 | |
| | |
Kardemir Karabuk Demir Celik Sanayi ve Ticaret A/S, Class D | | | 25,039 | | | | 22,090 | |
| | |
KG DONGBUSTEEL | | | 11,609 | | | | 60,428 | |
| | |
Korea Zinc Co. Ltd. | | | 188 | | | | 65,286 | |
| | |
Koza Altin Isletmeleri A/S | | | 27,440 | | | | 21,298 | |
| | |
Koza Anadolu Metal Madencilik Isletmeleri A/S* | | | 74,730 | | | | 138,933 | |
| | |
Kumba Iron Ore Ltd. | | | 1,440 | | | | 37,932 | |
| | |
Lloyds Metals & Energy Ltd.* | | | 4,704 | | | | 29,122 | |
| | |
Maanshan Iron & Steel Co. Ltd., Class A | | | 21,200 | | | | 7,996 | |
| | |
Maanshan Iron & Steel Co. Ltd., Class H | | | 22,000 | | | | 3,627 | |
| | |
Magnitogorsk Iron & Steel Works PJSC* ‡ | | | 45,174 | | | | — | |
| | |
Merdeka Copper Gold Tbk. PT* | | | 221,062 | | | | 31,034 | |
| | |
Metalurgica Gerdau SA (Preference) | | | 21,400 | | | | 43,835 | |
| | |
Minsur SA* | | | 127,746 | | | | 132,241 | |
| | |
MMC Norilsk Nickel PJSC* ‡ | | | 2,090 | | | | — | |
| | |
MMG Ltd.* (a) | | | 84,000 | | | | 24,799 | |
| | |
National Aluminium Co. Ltd. | | | 360,255 | | | | 399,160 | |
| | |
Nickel Asia Corp. | | | 1,442,900 | | | | 138,594 | |
| | |
NMDC Ltd. | | | 31,067 | | | | 57,538 | |
| | |
Northam Platinum Holdings Ltd. | | | 10,105 | | | | 60,635 | |
| | |
Novolipetsk Steel PJSC* ‡ | | | 51,150 | | | | — | |
| | |
Pangang Group Vanadium Titanium & Resources Co. Ltd., Class A* | | | 14,100 | | | | 6,724 | |
| | |
PMB Technology Bhd.* | | | 4,700 | | | | 3,009 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Polyus PJSC* ‡ | | | 1,155 | | | $ | — | |
| | |
Poongsan Corp. | | | 784 | | | | 20,869 | |
| | |
POSCO Holdings, Inc. | | | 2,021 | | | | 615,780 | |
| | |
Posco M-Tech Co. Ltd. | | | 931 | | | | 14,614 | |
| | |
Press Metal Aluminium Holdings Bhd. | | | 56,400 | | | | 58,241 | |
| | |
Qatar Aluminum Manufacturing Co. | | | 42,858 | | | | 14,572 | |
| | |
Raspadskaya OJSC* ‡ | | | 4,240 | | | | — | |
| | |
Ratnamani Metals & Tubes Ltd. | | | 1,265 | | | | 42,037 | |
| | |
Sam-A Aluminum Co. Ltd. | | | 245 | | | | 22,622 | |
| | |
Saudi Arabian Mining Co.* | | | 19,228 | | | | 184,510 | |
| | |
SeAH Besteel Holdings Corp. | | | 5,499 | | | | 88,559 | |
| | |
SeAH Steel Holdings Corp. | | | 663 | | | | 98,182 | |
| | |
Severstal PAO* ‡ | | | 5,995 | | | | — | |
| | |
Shandong Gold Mining Co. Ltd., Class A | | | 5,100 | | | | 16,649 | |
| | |
Shandong Gold Mining Co. Ltd., Class H(b) | | | 12,250 | | | | 23,077 | |
| | |
Shandong Nanshan Aluminum Co. Ltd., Class A | | | 18,800 | | | | 7,964 | |
| | |
Shanxi Meijin Energy Co. Ltd., Class A* | | | 9,400 | | | | 9,004 | |
| | |
Shanxi Taigang Stainless Steel Co. Ltd., Class A | | | 15,900 | | | | 8,495 | |
| | |
Shougang Fushan Resources Group Ltd. | | | 1,270,000 | | | | 417,133 | |
| | |
Sibanye Stillwater Ltd. | | | 76,093 | | | | 97,009 | |
| | |
Steel Authority of India Ltd. | | | 44,288 | | | | 44,603 | |
| | |
TA Chen Stainless Pipe | | | 56,800 | | | | 64,882 | |
| | |
Tata Steel Ltd. | | | 214,179 | | | | 305,478 | |
| | |
TCC Steel | | | 735 | | | | 28,300 | |
| | |
Tiangong International Co. Ltd. | | | 564,000 | | | | 165,785 | |
| | |
Tianshan Aluminum Group Co. Ltd., Class A | | | 10,600 | | | | 9,386 | |
| | |
Tongling Nonferrous Metals Group Co. Ltd., Class A | | | 29,400 | | | | 12,494 | |
| | |
Tung Ho Steel Enterprise Corp. | | | 17,050 | | | | 34,168 | |
| | |
United Co. RUSAL International PJSC* ‡ | | | 75,100 | | | | — | |
| | |
Usha Martin Ltd. | | | 6,762 | | | | 24,170 | |
| | |
Usinas Siderurgicas de Minas Gerais SA Usiminas (Preference), Class A | | | 183,300 | | | | 240,256 | |
See Accompanying Notes to the Financial Statements.
| | | | |
256 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Vale Indonesia Tbk. PT | | | 28,200 | | | $ | 8,788 | |
| | |
Vale SA | | | 98,700 | | | | 1,350,447 | |
| | |
Vedanta Ltd. | | | 28,012 | | | | 72,874 | |
| | |
VSMPO-AVISMA Corp. PJSC‡ | | | 53 | | | | — | |
| | |
Western Mining Co. Ltd., Class A | | | 4,800 | | | | 8,238 | |
| | |
Western Superconducting Technologies Co. Ltd., Class A | | | 1,052 | | | | 6,591 | |
| | |
Xiamen Tungsten Co. Ltd., Class A | | | 3,900 | | | | 9,033 | |
| | |
YongXing Special Materials Technology Co. Ltd., Class A | | | 3,800 | | | | 25,937 | |
| | |
Young Poong Corp. | | | 282 | | | | 98,033 | |
| | |
Yunnan Aluminium Co. Ltd., Class A | | | 6,300 | | | | 11,983 | |
| | |
Yunnan Copper Co. Ltd., Class A | | | 4,800 | | | | 7,241 | |
| | |
Yunnan Tin Co. Ltd., Class A | | | 9,600 | | | | 18,497 | |
| | |
Zhaojin Mining Industry Co. Ltd., Class H(a) | | | 24,500 | | | | 30,623 | |
| | |
Zhejiang Huayou Cobalt Co. Ltd., Class A | | | 6,940 | | | | 34,889 | |
| | |
Zijin Mining Group Co. Ltd., Class A | | | 46,200 | | | | 78,535 | |
| | |
Zijin Mining Group Co. Ltd., Class H | | | 160,000 | | | | 248,652 | |
| | | | | | | 10,985,970 | |
|
Multi-Utilities – 0.1% | |
| | |
Dubai Electricity & Water Authority PJSC | | | 132,493 | | | | 85,851 | |
| | |
Power & Water Utility Co. for Jubail & Yanbu | | | 1,225 | | | | 17,763 | |
| | |
Qatar Electricity & Water Co. QSC | | | 8,754 | | | | 39,767 | |
| | |
YTL Corp. Bhd. | | | 83,300 | | | | 25,526 | |
| | |
YTL Power International Bhd. | | | 78,431 | | | | 34,734 | |
| | | | | | | 203,641 | |
|
Office REITs – 0.0%(d) | |
| | |
AREIT, Inc., REIT | | | 30,000 | | | | 17,342 | |
| | |
Embassy Office Parks REIT, REIT | | | 8,680 | | | | 32,492 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Office REITs – (continued) | |
| | |
JR Global Reit, REIT | | | 7,119 | | | $ | 20,742 | |
| | |
RL Commercial REIT, Inc., REIT | | | 164,500 | | | | 13,742 | |
| | |
Shinhan Alpha REIT Co. Ltd., REIT | | | 3,773 | | | | 17,125 | |
| | | | | | | 101,443 | |
|
Oil, Gas & Consumable Fuels – 5.4% | |
| | |
3R Petroleum Oleo E Gas SA* | | | 82,732 | | | | 532,188 | |
| | |
ABM Investama Tbk. PT | | | 206,800 | | | | 49,731 | |
| | |
Adaro Energy Indonesia Tbk. PT | | | 366,700 | | | | 59,097 | |
| | |
Aegis Logistics Ltd. | | | 4,841 | | | | 17,001 | |
| | |
AKR Corporindo Tbk. PT | | | 140,000 | | | | 13,132 | |
| | |
Aldrees Petroleum and Transport Services Co. | | | 1,690 | | | | 52,976 | |
| | |
Bangchak Corp. PCL, NVDR | | | 14,000 | | | | 16,067 | |
| | |
Banpu PCL, NVDR | | | 93,200 | | | | 19,707 | |
| | |
Bashneft PJSC‡ | | | 1,305 | | | | — | |
| | |
Bashneft PJSC (Preference)‡ | | | 1,163 | | | | — | |
| | |
Bayan Resources Tbk. PT | | | 126,900 | | | | 145,593 | |
| | |
Bharat Petroleum Corp. Ltd. | | | 27,252 | | | | 114,315 | |
| | |
Bukit Asam Tbk. PT | | | 106,000 | | | | 16,549 | |
| | |
Bumi Resources Tbk. PT* | | | 4,937,100 | | | | 35,121 | |
| | |
China Coal Energy Co. Ltd., Class A | | | 16,100 | | | | 18,920 | |
| | |
China Coal Energy Co. Ltd., Class H | | | 49,000 | | | | 38,451 | |
| | |
China Merchants Energy Shipping Co. Ltd., Class A | | | 14,100 | | | | 12,389 | |
| | |
China Petroleum & Chemical Corp., Class A | | | 122,200 | | | | 91,173 | |
| | |
China Petroleum & Chemical Corp., Class H | | | 658,000 | | | | 336,375 | |
| | |
China Shenhua Energy Co. Ltd., Class A | | | 18,800 | | | | 77,891 | |
| | |
China Shenhua Energy Co. Ltd., Class H | | | 94,000 | | | | 288,321 | |
| | |
China Suntien Green Energy Corp. Ltd., Class H(a) | | | 50,000 | | | | 17,381 | |
| | |
Coal India Ltd. | | | 57,387 | | | | 216,600 | |
| | |
Cosan SA | | | 32,900 | | | | 102,751 | |
| | |
COSCO SHIPPING Energy Transportation Co. Ltd., Class A | | | 8,600 | | | | 16,946 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 257 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
COSCO SHIPPING Energy Transportation Co. Ltd., Class H(a) | | | 16,000 | | | $ | 16,931 | |
| | |
Dana Gas PJSC | | | 2,170,037 | | | | 478,554 | |
| | |
Ecopetrol SA | | | 140,483 | | | | 82,282 | |
| | |
Empresas Copec SA | | | 10,011 | | | | 66,060 | |
| | |
Esso Thailand PCL, NVDR | | | 460,600 | | | | 122,382 | |
| | |
Exxaro Resources Ltd. | | | 5,875 | | | | 58,591 | |
| | |
Formosa Petrochemical Corp. | | | 29,000 | | | | 70,723 | |
| | |
Gazprom PJSC* ‡ | | | 412,500 | | | | — | |
| | |
Great Eastern Shipping Co. Ltd. (The) | | | 39,856 | | | | 380,208 | |
| | |
Guanghui Energy Co. Ltd., Class A | | | 15,100 | | | | 15,475 | |
| | |
Harum Energy Tbk. PT | | | 1,090,400 | | | | 110,859 | |
| | |
HD Hyundai Co. Ltd. | | | 1,445 | | | | 61,414 | |
| | |
Helleniq Energy Holdings SA | | | 1,316 | | | | 9,640 | |
| | |
Hibiscus Petroleum Bhd. | | | 274,480 | | | | 153,817 | |
| | |
Hindustan Petroleum Corp. Ltd.* | | | 17,484 | | | | 52,016 | |
| | |
Indian Oil Corp. Ltd. | | | 103,353 | | | | 111,349 | |
| | |
Indika Energy Tbk. PT | | | 615,200 | | | | 70,292 | |
| | |
Indo Tambangraya Megah Tbk. PT | | | 9,400 | | | | 15,696 | |
| | |
Inner Mongolia Dian Tou Energy Corp. Ltd., Class A | | | 5,300 | | | | 9,850 | |
| | |
Inner Mongolia Yitai Coal Co. Ltd., Class B* | | | 30,300 | | | | 41,572 | |
| | |
IRPC PCL, NVDR | | | 401,800 | | | | 21,464 | |
| | |
Jinneng Holding Shanxi Coal Industry Co. Ltd., Class A | | | 4,900 | | | | 7,888 | |
| | |
Jizhong Energy Resources Co. Ltd., Class A | | | 4,800 | | | | 4,204 | |
| | |
LUKOIL PJSC‡ | | | 12,265 | | | | — | |
| | |
Mangalore Refinery & Petrochemicals Ltd.* | | | 72,804 | | | | 90,678 | |
| | |
Medco Energi Internasional Tbk. PT | | | 178,600 | | | | 14,335 | |
| | |
MOL Hungarian Oil & Gas plc | | | 13,865 | | | | 110,077 | |
| | |
Motor Oil Hellas Corinth Refineries SA | | | 1,579 | | | | 37,553 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Nanjing Tanker Corp., Class A* | | | 9,800 | | | $ | 4,004 | |
| | |
Novatek PJSC‡ | | | 20,020 | | | | — | |
| | |
Oil & Natural Gas Corp. Ltd. | | | 107,912 | | | | 241,270 | |
| | |
Oil India Ltd. | | | 12,119 | | | | 43,500 | |
| | |
PetroChina Co. Ltd., Class H | | | 564,000 | | | | 367,610 | |
| | |
Petroleo Brasileiro SA | | | 98,700 | | | | 740,593 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 126,900 | | | | 874,183 | |
| | |
Petronas Dagangan Bhd. | | | 4,900 | | | | 23,510 | |
| | |
Petronet LNG Ltd. | | | 19,599 | | | | 46,986 | |
| | |
Petroreconcavo SA | | | 56,400 | | | | 231,952 | |
| | |
Pingdingshan Tianan Coal Mining Co. Ltd., Class A | | | 9,800 | | | | 13,391 | |
| | |
PRIO SA* | | | 21,100 | | | | 199,578 | |
| | |
Productive Technologies Co. Ltd.* | | | 90,000 | | | | 8,627 | |
| | |
PTT Exploration & Production PCL | | | 469 | | | | 2,140 | |
| | |
PTT Exploration & Production PCL, NVDR | | | 37,531 | | | | 171,248 | |
| | |
PTT PCL, NVDR | | | 220,900 | | | | 204,352 | |
| | |
Qatar Fuel QSC | | | 8,416 | | | | 34,325 | |
| | |
Qatar Gas Transport Co. Ltd. | | | 51,996 | | | | 50,268 | |
| | |
Rabigh Refining & Petrochemical Co.* | | | 5,254 | | | | 14,117 | |
| | |
Reliance Industries Ltd. | | | 53,533 | | | | 1,471,054 | |
| | |
Rosneft Oil Co. PJSC‡ | | | 72,122 | | | | — | |
| | |
Rosneft Oil Co. PJSC, GDR* ‡ (b) | | | 1,920 | | | | — | |
| | |
Saudi Arabian Oil Co.(c) | | | 67,116 | | | | 595,736 | |
| | |
Semirara Mining & Power Corp., Class A | | | 42,200 | | | | 21,569 | |
| | |
Shaanxi Coal Industry Co. Ltd., Class A | | | 23,500 | | | | 57,866 | |
| | |
Shan Xi Hua Yang Group New Energy Co. Ltd., Class A | | | 7,050 | | | | 7,765 | |
| | |
Shandong Xinchao Energy Corp. Ltd., Class A* | | | 4,900 | | | | 1,714 | |
| | |
Shanxi Coking Coal Energy Group Co. Ltd., Class A | | | 9,400 | | | | 11,098 | |
| | |
Shanxi Lu’an Environmental Energy Development Co. Ltd., Class A | | | 6,200 | | | | 16,097 | |
See Accompanying Notes to the Financial Statements.
| | | | |
258 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Siamgas & Petrochemicals PCL, NVDR | | | 217,300 | | | $ | 48,064 | |
| | |
Sinopec Kantons Holdings Ltd. | | | 376,000 | | | | 148,005 | |
| | |
SK Discovery Co. Ltd. | | | 3,713 | | | | 101,585 | |
| | |
SK Gas Ltd. | | | 1,034 | | | | 113,311 | |
| | |
SK Innovation Co. Ltd.* | | | 1,466 | | | | 132,646 | |
| | |
S-Oil Corp. | | | 1,308 | | | | 64,308 | |
| | |
Star Petroleum Refining PCL, NVDR | | | 33,500 | | | | 6,897 | |
| | |
Surgutneftegas PJSC‡ | | | 319,000 | | | | — | |
| | |
Surgutneftegas PJSC (Preference)‡ | | | 225,500 | | | | — | |
| | |
Tatneft PJSC‡ | | | 26,900 | | | | — | |
| | |
Tatneft PJSC (Preference)‡ | | | 3,870 | | | | — | |
| | |
Thai Oil PCL, NVDR | | | 28,802 | | | | 37,663 | |
| | |
Thungela Resources Ltd. | | | 4,116 | | | | 36,521 | |
| | |
Transneft PJSC (Preference)‡ | | | 55 | | | | — | |
| | |
Turkiye Petrol Rafinerileri A/S | | | 22,184 | | | | 111,262 | |
| | |
Ultrapar Participacoes SA | | | 20,738 | | | | 84,095 | |
| | |
United Tractors Tbk. PT | | | 37,600 | | | | 59,471 | |
| | |
Vista Energy SAB de CV, ADR* | | | 27,818 | | | | 757,206 | |
| | |
Yancoal Australia Ltd.(b) | | | 9,400 | | | | 28,832 | |
| | |
Yankuang Energy Group Co. Ltd., Class A | | | 7,950 | | | | 21,206 | |
| | |
Yankuang Energy Group Co. Ltd., Class H(a) | | | 69,000 | | | | 119,929 | |
| | | | | | | 11,828,139 | |
|
Paper & Forest Products – 0.5% | |
| | |
Century Plyboards India Ltd. | | | 3,256 | | | | 24,203 | |
| | |
Century Textiles & Industries Ltd. | | | 2,118 | | | | 27,545 | |
| | |
Dexco SA* | | | 14,700 | | | | 19,996 | |
| | |
Dongwha Enterprise Co. Ltd.* | | | 441 | | | | 20,082 | |
| | |
Empresas CMPC SA | | | 24,310 | | | | 43,319 | |
| | |
Indah Kiat Pulp & Paper Tbk. PT | | | 82,400 | | | | 49,798 | |
| | |
JK Paper Ltd. | | | 30,691 | | | | 140,500 | |
| | |
Lee & Man Paper Manufacturing Ltd. | | | 49,000 | | | | 13,965 | |
| | |
Longchen Paper & Packaging Co. Ltd. | | | 282,967 | | | | 120,829 | |
| | |
Nine Dragons Paper Holdings Ltd. | | | 55,000 | | | | 31,280 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Paper & Forest Products – (continued) | |
| | |
Pabrik Kertas Tjiwi Kimia Tbk. PT | | | 502,900 | | | $ | 242,190 | |
| | |
Sappi Ltd. | | | 16,314 | | | | 34,122 | |
| | |
Shandong Sun Paper Industry JSC Ltd., Class A | | | 9,400 | | | | 15,966 | |
| | |
Shihlin Paper Corp.* | | | 9,648 | | | | 15,230 | |
| | |
Suzano SA | | | 18,800 | | | | 192,250 | |
| | |
YFY, Inc. | | | 22,472 | | | | 20,646 | |
| | |
Young Poong Paper Manufacturing Co. Ltd. | | | 931 | | | | 5,632 | |
| | | | | | | 1,017,553 | |
|
Passenger Airlines – 0.5% | |
| | |
Aegean Airlines SA* (a) | | | 13,442 | | | | 146,913 | |
| | |
Aeroflot PJSC* ‡ | | | 74,029 | | | | — | |
| | |
Air Arabia PJSC | | | 62,322 | | | | 44,455 | |
| | |
Asiana Airlines, Inc.* | | | 15,181 | | | | 125,333 | |
| | |
Azul SA (Preference)* | | | 11,500 | | | | 29,371 | |
| | |
Bangkok Airways PCL, NVDR* | | | 39,100 | | | | 14,795 | |
| | |
China Airlines Ltd. | | | 61,000 | | | | 36,391 | |
| | |
China Eastern Airlines Corp. Ltd., Class A* | | | 14,300 | | | | 8,520 | |
| | |
China Eastern Airlines Corp. Ltd., Class H* | | | 46,000 | | | | 15,755 | |
| | |
China Southern Airlines Co. Ltd., Class A* | | | 14,100 | | | | 11,907 | |
| | |
China Southern Airlines Co. Ltd., Class H* | | | 24,000 | | | | 11,349 | |
| | |
Controladora Vuela Cia de Aviacion SAB de CV, Class A* (a) | | | 35,700 | | | | 20,329 | |
| | |
Eva Airways Corp. | | | 73,592 | | | | 62,168 | |
| | |
Hainan Airlines Holding Co. Ltd., Class A* | | | 67,200 | | | | 13,407 | |
| | |
Hanjin Kal Corp. | | | 637 | | | | 20,116 | |
| | |
InterGlobe Aviation Ltd.* (b) | | | 1,799 | | | | 53,021 | |
| | |
Jazeera Airways Co. KSCP | | | 4,053 | | | | 19,116 | |
| | |
Jeju Air Co. Ltd.* | | | 1,962 | | | | 15,341 | |
| | |
Jin Air Co. Ltd.* | | | 9,541 | | | | 79,123 | |
| | |
Korean Air Lines Co. Ltd. | | | 4,888 | | | | 74,195 | |
| | |
Latam Airlines Group SA* | | | 3,059,341 | | | | 23,851 | |
| | |
Pegasus Hava Tasimaciligi A/S* | | | 1,081 | | | | 26,936 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 259 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Passenger Airlines – (continued) | |
| | |
Spring Airlines Co. Ltd., Class A* | | | 2,400 | | | $ | 17,955 | |
| | |
Turk Hava Yollari AO* | | | 18,835 | | | | 144,661 | |
| | |
Tway Air Co. Ltd.* | | | 29,375 | | | | 47,307 | |
| | | | | | | 1,062,315 | |
|
Personal Care Products – 0.6% | |
| | |
Amorepacific Corp. | | | 519 | | | | 48,574 | |
| | |
AMOREPACIFIC Group | | | 611 | | | | 12,939 | |
| | |
Colgate-Palmolive India Ltd. | | | 1,824 | | | | 46,308 | |
| | |
Cosmax, Inc.* | | | 3,196 | | | | 320,890 | |
| | |
Dabur India Ltd. | | | 10,387 | | | | 65,983 | |
| | |
EIS Eczacibasi Ilac ve Sinai ve Finansal Yatirimlar Sanayi ve Ticaret A/S | | | 5,880 | | | | 9,119 | |
| | |
Emami Ltd. | | | 931 | | | | 5,702 | |
| | |
Gillette India Ltd. | | | 392 | | | | 28,834 | |
| | |
Godrej Consumer Products Ltd.* | | | 5,922 | | | | 70,548 | |
| | |
Hengan International Group Co. Ltd. | | | 23,500 | | | | 78,688 | |
| | |
Hindustan Unilever Ltd. | | | 13,724 | | | | 409,451 | |
| | |
Hyundai Bioscience Co. Ltd.* | | | 1,504 | | | | 41,649 | |
| | |
Kolmar BNH Co. Ltd. | | | 931 | | | | 11,333 | |
| | |
Kolmar Korea Co. Ltd. | | | 735 | | | | 29,170 | |
| | |
LG H&H Co. Ltd. | | | 141 | | | | 32,939 | |
| | |
LG H&H Co. Ltd. (Preference) | | | 43 | | | | 4,508 | |
| | |
Microbio Co. Ltd. | | | 1,580 | | | | 2,499 | |
| | |
Natura & Co. Holding SA* | | | 10,958 | | | | 27,705 | |
| | |
Procter & Gamble Hygiene & Health Care Ltd. | | | 196 | | | | 41,293 | |
| | |
Sarantis SA | | | 1,666 | | | | 13,824 | |
| | |
TCI Co. Ltd. | | | 4,688 | | | | 25,005 | |
| | | | | | | 1,326,961 | |
|
Pharmaceuticals – 1.6% | |
| | |
Adcock Ingram Holdings Ltd.(a) | | | 31,114 | | | | 89,855 | |
| | |
Ajanta Pharma Ltd. | | | 576 | | | | 12,198 | |
| | |
Alembic Pharmaceuticals Ltd. | | | 3,400 | | | | 29,118 | |
| | |
Alkem Laboratories Ltd. | | | 516 | | | | 23,066 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Pharmaceuticals – (continued) | |
| | |
Aspen Pharmacare Holdings Ltd. | | | 4,982 | | | $ | 44,989 | |
| | |
Asymchem Laboratories Tianjin Co. Ltd., Class A | | | 700 | | | | 14,439 | |
| | |
Aurobindo Pharma Ltd. | | | 3,791 | | | | 38,680 | |
| | |
Beijing Tong Ren Tang Chinese Medicine Co. Ltd. | | | 5,000 | | | | 7,515 | |
| | |
Beijing Tongrentang Co. Ltd., Class A | | | 4,700 | | | | 32,979 | |
| | |
Bora Pharmaceuticals Co. Ltd. | | | 1,008 | | | | 20,169 | |
| | |
Boryung | | | 2,597 | | | | 17,306 | |
| | |
Bukwang Pharmaceutical Co. Ltd.* | | | 1,431 | | | | 6,018 | |
| | |
CanSino Biologics, Inc., Class A* | | | 318 | | | | 3,450 | |
| | |
CanSino Biologics, Inc., Class H* (a) (b) | | | 800 | | | | 2,530 | |
| | |
Caregen Co. Ltd. | | | 144 | | | | 2,858 | |
| | |
Celltrion Pharm, Inc.* | | | 136 | | | | 6,374 | |
| | |
Center Laboratories, Inc. | | | 11,446 | | | | 16,109 | |
| | |
Changchun High & New Technology Industry Group, Inc., Class A | | | 600 | | | | 12,759 | |
| | |
China Medical System Holdings Ltd. | | | 47,000 | | | | 75,084 | |
| | |
China Resources Pharmaceutical Group Ltd.(b) | | | 51,000 | | | | 31,677 | |
| | |
China Resources Sanjiu Medical & Pharmaceutical Co. Ltd., Class A | | | 4,000 | | | | 23,580 | |
| | |
Chong Kun Dang Pharmaceutical Corp. | | | 107 | | | | 7,519 | |
| | |
Cipla Ltd. | | | 8,601 | | | | 123,965 | |
| | |
CSPC Pharmaceutical Group Ltd. | | | 142,080 | | | | 124,020 | |
| | |
Daewoong Co. Ltd. | | | 9,447 | | | | 104,224 | |
| | |
Daewoong Pharmaceutical Co. Ltd. | | | 49 | | | | 3,625 | |
| | |
Dong-A Socio Holdings Co. Ltd. | | | 1,618 | | | | 119,324 | |
| | |
DongKook Pharmaceutical Co. Ltd. | | | 2,205 | | | | 26,302 | |
| | |
Dr Reddy’s Laboratories Ltd. | | | 2,055 | | | | 132,482 | |
See Accompanying Notes to the Financial Statements.
| | | | |
260 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Pharmaceuticals – (continued) | |
| | |
Eris Lifesciences Ltd.* (b) | | | 1,617 | | | $ | 16,693 | |
| | |
Genomma Lab Internacional SAB de CV, Class B | | | 296,100 | | | | 221,751 | |
| | |
Gland Pharma Ltd.* (b) | | | 971 | | | | 18,030 | |
| | |
GlaxoSmithKline Pharmaceuticals Ltd. | | | 376 | | | | 6,428 | |
| | |
Glenmark Pharmaceuticals Ltd. | | | 5,922 | | | | 53,186 | |
| | |
Grand Pharmaceutical Group Ltd. | | | 33,000 | | | | 17,756 | |
| | |
Granules India Ltd. | | | 5,750 | | | | 22,507 | |
| | |
Hanall Biopharma Co. Ltd.* | | | 1,666 | | | | 36,082 | |
| | |
Hanmi Pharm Co. Ltd. | | | 100 | | | | 20,880 | |
| | |
Hanmi Science Co. Ltd. | | | 671 | | | | 15,725 | |
| | |
Hansoh Pharmaceutical Group Co. Ltd.(b) | | | 16,000 | | | | 30,141 | |
| | |
HK inno N Corp. | | | 644 | | | | 20,600 | |
| | |
Hua Han Health Industry Holdings Ltd.* ‡ | | | 3,780,000 | | | | — | |
| | |
Hubei Jumpcan Pharmaceutical Co. Ltd., Class A | | | 3,100 | | | | 11,476 | |
| | |
Hypera SA | | | 6,900 | | | | 41,444 | |
| | |
Il Dong Pharmaceutical Co. Ltd.* | | | 511 | | | | 6,092 | |
| | |
Ipca Laboratories Ltd. | | | 1,519 | | | | 17,948 | |
| | |
JB Chemicals & Pharmaceuticals Ltd. | | | 3,218 | | | | 54,043 | |
| | |
Jiangsu Hengrui Pharmaceuticals Co. Ltd., Class A | | | 8,400 | | | | 55,027 | |
| | |
Joincare Pharmaceutical Group Industry Co. Ltd., Class A | | | 4,700 | | | | 7,617 | |
| | |
Kalbe Farma Tbk. PT | | | 351,000 | | | | 37,343 | |
| | |
Komipharm International Co. Ltd.* | | | 1,568 | | | | 6,002 | |
| | |
Laurus Labs Ltd.(b) | | | 3,969 | | | | 17,245 | |
| | |
Livzon Pharmaceutical Group, Inc., Class H | | | 3,930 | | | | 11,602 | |
| | |
Lotus Pharmaceutical Co. Ltd. | | | 2,000 | | | | 15,539 | |
| | |
Lupin Ltd. | | | 3,167 | | | | 42,913 | |
| | |
Luye Pharma Group Ltd.* (a) (b) | | | 73,500 | | | | 35,601 | |
| | |
Natco Pharma Ltd. | | | 3,552 | | | | 34,145 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Pharmaceuticals – (continued) | |
| | |
Oneness Biotech Co. Ltd. | | | 4,197 | | | $ | 25,362 | |
| | |
Oscotec, Inc.* | | | 1,034 | | | | 14,547 | |
| | |
Pfizer Ltd. | | | 341 | | | | 16,114 | |
| | |
Pharmally International Holding Co. Ltd.* ‡ | | | 2,564 | | | | — | |
| | |
Piramal Pharma Ltd.* | | | 26,402 | | | | 33,138 | |
| | |
Procter & Gamble Health Ltd. | | | 400 | | | | 24,514 | |
| | |
Richter Gedeon Nyrt. | | | 3,846 | | | | 89,978 | |
| | |
Sam Chun Dang Pharm Co. Ltd.* | | | 240 | | | | 10,911 | |
| | |
Sanofi India Ltd. | | | 392 | | | | 35,595 | |
| | |
Saudi Pharmaceutical Industries & Medical Appliances Corp.* | | | 1,470 | | | | 11,637 | |
| | |
SciClone Pharmaceuticals Holdings Ltd.(b) | | | 94,000 | | | | 123,738 | |
| | |
Shandong Sinobioway Biomedicine Co. Ltd., Class A* | | | 4,800 | | | | 11,341 | |
| | |
Shanghai Fosun Pharmaceutical Group Co. Ltd., Class A | | | 3,800 | | | | 14,768 | |
| | |
Shanghai Fosun Pharmaceutical Group Co. Ltd., Class H(a) | | | 8,000 | | | | 18,444 | |
| | |
Shanghai Shyndec Pharmaceutical Co. Ltd., Class A | | | 14,400 | | | | 20,268 | |
| | |
Shijiazhuang Yiling Pharmaceutical Co. Ltd., Class A | | | 4,700 | | | | 14,271 | |
| | |
Shin Poong Pharmaceutical Co. Ltd.* | | | 1,824 | | | | 15,680 | |
| | |
Sichuan Kelun Pharmaceutical Co. Ltd., Class A | | | 4,800 | | | | 18,011 | |
| | |
Sihuan Pharmaceutical Holdings Group Ltd. | | | 125,000 | | | | 10,544 | |
| | |
Sino Biopharmaceutical Ltd. | | | 169,999 | | | | 66,048 | |
| | |
SK Biopharmaceuticals Co. Ltd.* | | | 330 | | | | 18,424 | |
| | |
Sun Pharmaceutical Industries Ltd. | | | 17,321 | | | | 226,470 | |
| | |
Suven Pharmaceuticals Ltd.* | | | 3,735 | | | | 25,961 | |
| | |
Synmosa Biopharma Corp. | | | 16,272 | | | | 18,838 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 261 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Pharmaceuticals – (continued) | |
| | |
Tianjin Pharmaceutical Da Re Tang Group Corp. Ltd., Class S | | | 9,600 | | | $ | 16,896 | |
| | |
Torrent Pharmaceuticals Ltd. | | | 1,434 | | | | 33,142 | |
| | |
TTY Biopharm Co. Ltd. | | | 11,464 | | | | 29,654 | |
| | |
United Laboratories International Holdings Ltd. (The) | | | 376,000 | | | | 383,948 | |
| | |
Yuhan Corp. | | | 1,034 | | | | 43,946 | |
| | |
Yungjin Pharmaceutical Co. Ltd.* | | | 1,602 | | | | 2,485 | |
| | |
Yunnan Baiyao Group Co. Ltd., Class A | | | 4,800 | | | | 33,353 | |
| | |
Zhangzhou Pientzehuang Pharmaceutical Co. Ltd., Class A | | | 1,300 | | | | 44,446 | |
| | |
Zhejiang NHU Co. Ltd., Class A | | | 4,800 | | | | 10,613 | |
| | |
Zydus Lifesciences Ltd. | | | 4,744 | | | | 32,680 | |
| | | | | | | 3,521,795 | |
|
Professional Services – 0.1% | |
| | |
BLS International Services Ltd. | | | 3,626 | | | | 11,400 | |
| | |
Computer Age Management Services Ltd. | | | 1,007 | | | | 27,176 | |
| | |
CTOS Digital Bhd. | | | 84,900 | | | | 25,838 | |
| | |
eClerx Services Ltd. | | | 679 | | | | 15,968 | |
| | |
Firstsource Solutions Ltd. | | | 6,900 | | | | 12,933 | |
| | |
L&T Technology Services Ltd.(b) | | | 376 | | | | 18,907 | |
| | |
My EG Services Bhd. | | | 88,989 | | | | 14,568 | |
| | |
NICE Information Service Co. Ltd. | | | 686 | | | | 4,470 | |
| | |
RITES Ltd. | | | 4,263 | | | | 23,120 | |
| | |
Sporton International, Inc. | | | 3,150 | | | | 20,783 | |
| | | | | | | 175,163 | |
|
Real Estate Management & Development – 3.2% | |
| | |
Agile Group Holdings Ltd.* (a) | | | 752,000 | | | | 72,080 | |
| | |
Aldar Properties PJSC | | | 64,597 | | | | 91,452 | |
| | |
A-Living Smart City Services Co. Ltd.* (b) | | | 329,000 | | | | 155,153 | |
| | |
Allos SA | | | 14,100 | | | | 64,027 | |
| | |
Amata Corp. PCL, NVDR | | | 29,300 | | | | 19,402 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Real Estate Management & Development – (continued) | |
| | |
Arabian Centres Co. Ltd. | | | 676 | | | $ | 3,615 | |
| | |
Arriyadh Development Co. | | | 2,145 | | | | 11,435 | |
| | |
Ayala Land, Inc. | | | 81,600 | | | | 40,052 | |
| | |
Barwa Real Estate Co. | | | 66,505 | | | | 46,212 | |
| | |
Bumi Serpong Damai Tbk. PT* | | | 166,600 | | | | 10,540 | |
| | |
C&D International Investment Group Ltd. | | | 17,845 | | | | 40,048 | |
| | |
Cencosud Shopping SA | | | 11,750 | | | | 16,999 | |
| | |
Central Pattana PCL, NVDR | | | 23,700 | | | | 41,212 | |
| | |
China Dili Group* ‡ | | | 100,000 | | | | 4,601 | |
| | |
China Jinmao Holdings Group Ltd. | | | 99,553 | | | | 12,214 | |
| | |
China Merchants Shekou Industrial Zone Holdings Co. Ltd., Class A | | | 19,600 | | | | 29,568 | |
| | |
China Overseas Grand Oceans Group Ltd.(a) | | | 49,000 | | | | 16,720 | |
| | |
China Overseas Land & Investment Ltd. | | | 94,000 | | | | 177,558 | |
| | |
China Overseas Property Holdings Ltd. | | | 30,000 | | | | 26,033 | |
| | |
China Resources Land Ltd. | | | 80,000 | | | | 299,568 | |
| | |
China Resources Mixc Lifestyle Services Ltd.(b) | | | 9,600 | | | | 37,420 | |
| | |
China Vanke Co. Ltd., Class A | | | 23,500 | | | | 36,383 | |
| | |
China Vanke Co. Ltd., Class H | | | 56,400 | | | | 52,763 | |
| | |
Chong Hong Construction Co. Ltd. | | | 78,872 | | | | 175,568 | |
| | |
Ciputra Development Tbk. PT | | | 3,496,849 | | | | 244,350 | |
| | |
Commercial Real Estate Co. KSC | | | 583,920 | | | | 185,428 | |
| | |
Corp. Inmobiliaria Vesta SAB de CV | | | 9,600 | | | | 30,061 | |
| | |
Cosmopolitan International Holdings Ltd.* | | | 9,400 | | | | 4,205 | |
| | |
Country Garden Holdings Co. Ltd.* (a) | | | 282,000 | | | | 25,228 | |
| | |
Country Garden Services Holdings Co. Ltd. | | | 47,000 | | | | 41,086 | |
| | |
Dar Al Arkan Real Estate Development Co.* | | | 7,655 | | | | 30,811 | |
| | |
DLF Ltd. | | | 10,810 | | | | 73,163 | |
| | |
Eco World Development Group Bhd. | | | 512,300 | | | | 108,600 | |
See Accompanying Notes to the Financial Statements.
| | | | |
262 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Real Estate Management & Development – (continued) | |
| | |
Emaar Development PJSC | | | 24,854 | | | $ | 41,953 | |
| | |
Emaar Economic City* | | | 9,847 | | | | 19,213 | |
| | |
Emaar Properties PJSC | | | 168,025 | | | | 306,041 | |
| | |
Fortress Real Estate Investments Ltd., Class A* | | | 56,682 | | | | 39,578 | |
| | |
Fortress Real Estate Investments Ltd., Class B* | | | 46,844 | | | | 14,743 | |
| | |
Fu Hua Innovation Co. Ltd. | | | 108,592 | | | | 86,211 | |
| | |
Gemdale Corp., Class A | | | 14,100 | | | | 9,961 | |
| | |
Gemdale Properties & Investment Corp. Ltd. | | | 2,068,000 | | | | 61,316 | |
| | |
Godrej Properties Ltd.* | | | 1,764 | | | | 35,163 | |
| | |
Greenland Holdings Corp. Ltd., Class A* | | | 33,600 | | | | 11,708 | |
| | |
Greentown China Holdings Ltd. | | | 25,000 | | | | 24,250 | |
| | |
Hainan Airport Infrastructure Co. Ltd., Class A* | | | 9,800 | | | | 5,102 | |
| | |
Hangzhou Binjiang Real Estate Group Co. Ltd., Class A | | | 4,300 | | | | 4,924 | |
| | |
Hanson International Tbk. PT* ‡ | | | 2,409,275 | | | | — | |
| | |
Highwealth Construction Corp. | | | 39,330 | | | | 49,352 | |
| | |
Hopson Development Holdings Ltd.* | | | 22,560 | | | | 13,205 | |
| | |
Huang Hsiang Construction Corp. | | | 47,000 | | | | 55,861 | |
| | |
Hung Sheng Construction Ltd. | | | 141,000 | | | | 78,031 | |
| | |
Iguatemi SA | | | 4,900 | | | | 19,501 | |
| | |
IOI Properties Group Bhd. | | | 52,800 | | | | 20,502 | |
| | |
Jinke Smart Services Group Co. Ltd., Class H* (a) (b) | | | 61,100 | | | | 60,986 | |
| | |
KE Holdings, Inc., ADR | | | 10,810 | | | | 159,015 | |
| | |
Kindom Development Co. Ltd. | | | 141,400 | | | | 148,877 | |
| | |
King’s Town Construction Co. Ltd.* | | | 2,000 | | | | 1,884 | |
| | |
LAMDA Development SA* | | | 1,368 | | | | 8,792 | |
| | |
Land & Houses PCL, NVDR | | | 83,200 | | | | 17,477 | |
| | |
Longfor Group Holdings Ltd.(b) | | | 49,488 | | | | 71,975 | |
| | |
LSR Group PJSC, Class A‡ | | | 21,295 | | | | — | |
| | |
LVGEM China Real Estate Investment Co. Ltd.* | | | 96,000 | | | | 10,797 | |
| | |
Mabanee Co. KPSC | | | 14,139 | | | | 37,683 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Real Estate Management & Development – (continued) | |
| | |
Macrotech Developers Ltd.(b) | | | 3,983 | | | $ | 37,683 | |
| | |
MAS P.L.C.(a) | | | 169,717 | | | | 137,607 | |
| | |
Matrix Concepts Holdings Bhd. | | | 253,800 | | | | 82,034 | |
| | |
MBK PCL, NVDR | | | 30,344 | | | | 13,508 | |
| | |
Megaworld Corp. | | | 4,230,000 | | | | 147,610 | |
| | |
Midea Real Estate Holding Ltd.(a) (b) | | | 141,000 | | | | 96,407 | |
| | |
Multiplan Empreendimentos Imobiliarios SA* | | | 5,000 | | | | 24,529 | |
| | |
National Real Estate Co. KPSC* | | | 380,697 | | | | 81,784 | |
| | |
Oberoi Realty Ltd. | | | 1,551 | | | | 21,197 | |
| | |
Origin Property PCL, NVDR | | | 282,000 | | | | 70,220 | |
| | |
OSK Holdings Bhd. | | | 390,100 | | | | 96,614 | |
| | |
Pakuwon Jati Tbk. PT | | | 155,100 | | | | 3,906 | |
| | |
Parque Arauco SA | | | 28,294 | | | | 38,538 | |
| | |
Phoenix Mills Ltd. (The) | | | 1,600 | | | | 34,886 | |
| | |
Poly Developments and Holdings Group Co. Ltd., Class A | | | 28,200 | | | | 42,465 | |
| | |
Poly Property Services Co. Ltd., Class H(b) | | | 6,200 | | | | 24,326 | |
| | |
Prestige Estates Projects Ltd. | | | 3,219 | | | | 29,604 | |
| | |
Prince Housing & Development Corp. | | | 50,000 | | | | 16,417 | |
| | |
Pruksa Holding PCL, NVDR | | | 249,100 | | | | 86,631 | |
| | |
Quality Houses PCL, NVDR | | | 1,739,000 | | | | 108,378 | |
| | |
Radiance Holdings Group Co. Ltd.* (a) (b) | | | 49,000 | | | | 20,352 | |
| | |
Red Star Macalline Group Corp. Ltd., Class A | | | 14,700 | | | | 8,557 | |
| | |
Redco Properties Group Ltd.* ‡ (b) | | | 294,000 | | | | 46,771 | |
| | |
Robinsons Land Corp. | | | 625,100 | | | | 153,576 | |
| | |
Ruentex Development Co. Ltd. | | | 43,560 | | | | 43,513 | |
| | |
Salhia Real Estate Co. KSCP | | | 16,277 | | | | 21,086 | |
| | |
Sansiri PCL, NVDR | | | 2,500,400 | | | | 106,437 | |
| | |
Saudi Real Estate Co.* | | | 3,478 | | | | 11,088 | |
| | |
SC Asset Corp. PCL, NVDR | | | 761,400 | | | | 71,601 | |
| | |
Seazen Group Ltd.* (a) | | | 940,000 | | | | 152,570 | |
| | |
Seazen Holdings Co. Ltd., Class A* | | | 4,700 | | | | 7,643 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 263 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Real Estate Management & Development – (continued) | |
| | |
Shanghai Jinqiao Export Processing Zone Development Co. Ltd., Class B | | | 103,400 | | | $ | 91,302 | |
| | |
Shanghai Lujiazui Finance & Trade Zone Development Co. Ltd., Class B | | | 4,900 | | | | 1,950 | |
| | |
Shanghai Zhangjiang High-Tech Park Development Co. Ltd., Class A | | | 4,700 | | | | 15,382 | |
| | |
Shenzhen Investment Ltd. | | | 940,000 | | | | 138,154 | |
| | |
Shenzhen Overseas Chinese Town Co. Ltd., Class A* | | | 22,200 | | | | 10,982 | |
| | |
Shoucheng Holdings Ltd. | | | 98,000 | | | | 16,031 | |
| | |
Shui On Land Ltd. | | | 1,410,000 | | | | 124,339 | |
| | |
Sichuan Languang Justbon Services Group Co. Ltd., Class H* ‡ | | | 26,500 | | | | — | |
| | |
Sime Darby Property Bhd. | | | 1,240,800 | | | | 160,162 | |
| | |
Sinic Holdings Group Co. Ltd.* ‡ | | | 318,000 | | | | — | |
| | |
SK D&D Co. Ltd. | | | 2,632 | | | | 53,496 | |
| | |
SM Prime Holdings, Inc. | | | 183,300 | | | | 96,916 | |
| | |
SOHO China Ltd.* | | | 76,000 | | | | 7,867 | |
| | |
SP Setia Bhd. Group | | | 770,800 | | | | 135,895 | |
| | |
Summarecon Agung Tbk. PT | | | 227,900 | | | | 7,676 | |
| | |
Supalai PCL, NVDR | | | 23,800 | | | | 12,184 | |
| | |
Talaat Moustafa Group | | | 401,192 | | | | 292,024 | |
| | |
United Development Co. QSC | | | 700,347 | | | | 187,157 | |
| | |
UOA Development Bhd. | | | 26,500 | | | | 9,400 | |
| | |
WHA Corp. PCL, NVDR | | | 117,490 | | | | 16,344 | |
| | |
Youngor Group Co. Ltd., Class A | | | 14,400 | | | | 13,282 | |
| | |
Yuexiu Property Co. Ltd. | | | 52,079 | | | | 54,178 | |
| | |
Yungshin Construction & Development Co. Ltd. | | | 26,448 | | | | 67,761 | |
| | |
Zhuhai Huafa Properties Co. Ltd., Class A | | | 4,900 | | | | 5,624 | |
| | | | | | | 6,993,300 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Residential REITs – 0.0%(d) | |
| | |
Emlak Konut Gayrimenkul Yatirim Ortakligi A/S, REIT | | | 63,896 | | | $ | 14,815 | |
|
Retail REITs – 0.3% | |
| | |
CPN Retail Growth Leasehold REIT, REIT | | | 44,100 | | | | 11,656 | |
| | |
Hyprop Investments Ltd., REIT | | | 148,379 | | | | 224,465 | |
| | |
IGB REIT, REIT | | | 53,900 | | | | 19,232 | |
| | |
LOTTE Reit Co. Ltd., REIT | | | 1,828 | | | | 3,891 | |
| | |
Pavilion REIT, REIT | | | 15,000 | | | | 3,810 | |
| | |
Resilient REIT Ltd., REIT(a) | | | 120,278 | | | | 238,350 | |
| | |
Sunway REIT, REIT | | | 53,900 | | | | 16,856 | |
| | |
Vukile Property Fund Ltd., REIT(a) | | | 361,148 | | | | 239,457 | |
| | | | | | | 757,717 | |
|
Semiconductors & Semiconductor Equipment – 7.0% | |
| | |
3peak, Inc., Class A | | | 245 | | | | 5,393 | |
| | |
ADATA Technology Co. Ltd. | | | 102,198 | | | | 306,893 | |
| | |
Advanced Wireless Semiconductor Co.* | | | 5,104 | | | | 17,703 | |
| | |
Alchip Technologies Ltd. | | | 1,184 | | | | 95,822 | |
| | |
Amlogic Shanghai Co. Ltd., Class A* | | | 2,377 | | | | 19,544 | |
| | |
Andes Technology Corp. | | | 1,507 | | | | 17,934 | |
| | |
Anji Microelectronics Technology Shanghai Co. Ltd., Class A | | | 127 | | | | 3,366 | |
| | |
AP Memory Technology Corp. | | | 2,224 | | | | 24,479 | |
| | |
Ardentec Corp. | | | 168,024 | | | | 336,721 | |
| | |
ASE Technology Holding Co. Ltd. | | | 94,000 | | | | 328,935 | |
| | |
ASMedia Technology, Inc. | | | 576 | | | | 23,353 | |
| | |
ASPEED Technology, Inc. | | | 520 | | | | 41,202 | |
| | |
Borosil Renewables Ltd.* | | | 1,880 | | | | 9,205 | |
| | |
Cambricon Technologies Corp. Ltd., Class A* | | | 288 | | | | 4,220 | |
| | |
China Resources Microelectronics Ltd., Class A | | | 1,350 | | | | 9,805 | |
| | |
Chipbond Technology Corp. | | | 21,776 | | | | 45,653 | |
| | |
D&O Green Technologies Bhd. | | | 15,300 | | | | 10,533 | |
| | |
Dagang NeXchange Bhd.* | | | 1,113,900 | | | | 101,699 | |
See Accompanying Notes to the Financial Statements.
| | | | |
264 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Daqo New Energy Corp., ADR* | | | 1,504 | | | $ | 38,292 | |
| | |
DB HiTek Co. Ltd. | | | 912 | | | | 32,684 | |
| | |
Duk San Neolux Co. Ltd.* | | | 423 | | | | 12,090 | |
| | |
Elan Microelectronics Corp. | | | 5,568 | | | | 24,720 | |
| | |
Elite Semiconductor Microelectronics Technology, Inc. | | | 12,360 | | | | 31,972 | |
| | |
eMemory Technology, Inc. | | | 1,000 | | | | 62,124 | |
| | |
Ennostar, Inc.* | | | 7,000 | | | | 8,892 | |
| | |
Eo Technics Co. Ltd. | | | 384 | | | | 39,607 | |
| | |
Episil Technologies, Inc. | | | 6,292 | | | | 13,269 | |
| | |
Eugene Technology Co. Ltd. | | | 686 | | | | 19,327 | |
| | |
Everlight Electronics Co. Ltd. | | | 166,728 | | | | 227,719 | |
| | |
Faraday Technology Corp. | | | 4,000 | | | | 37,244 | |
| | |
Flat Glass Group Co. Ltd., Class A | | | 3,600 | | | | 12,692 | |
| | |
Flat Glass Group Co. Ltd., Class H* (a) | | | 7,000 | | | | 12,542 | |
| | |
FocalTech Systems Co. Ltd. | | | 9,176 | | | | 22,802 | |
| | |
Formosa Sumco Technology Corp. | | | 1,000 | | | | 4,794 | |
| | |
Foxsemicon Integrated Technology, Inc. | | | 34,672 | | | | 195,087 | |
| | |
GCL System Integration Technology Co. Ltd., Class A* | | | 9,800 | | | | 3,696 | |
| | |
GCL Technology Holdings Ltd. | | | 517,000 | | | | 75,985 | |
| | |
GemVax & Kael Co. Ltd.* | | | 920 | | | | 9,666 | |
| | |
GigaDevice Semiconductor, Inc., Class A | | | 1,440 | | | | 21,055 | |
| | |
Global Mixed Mode Technology, Inc. | | | 27,544 | | | | 211,028 | |
| | |
Global Unichip Corp. | | | 1,432 | | | | 63,355 | |
| | |
Globalwafers Co. Ltd. | | | 5,000 | | | | 73,146 | |
| | |
Gudeng Precision Industrial Co. Ltd. | | | 1,728 | | | | 17,901 | |
| | |
HAESUNG DS Co. Ltd. | | | 4,136 | | | | 135,361 | |
| | |
Hana Materials, Inc. | | | 318 | | | | 11,149 | |
| | |
Hangzhou First Applied Material Co. Ltd., Class A | | | 3,724 | | | | 13,012 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Hangzhou Silan Microelectronics Co. Ltd., Class A | | | 2,900 | | | $ | 9,614 | |
| | |
Hanmi Semiconductor Co. Ltd. | | | 931 | | | | 36,191 | |
| | |
HD Hyundai Energy Solutions Co. Ltd. | | | 2,068 | | | | 33,381 | |
| | |
HPSP Co. Ltd. | | | 768 | | | | 17,714 | |
| | |
Hua Hong Semiconductor Ltd.* (a) (b) | | | 30,000 | | | | 73,614 | |
| | |
Inari Amertron Bhd. | | | 39,200 | | | | 23,448 | |
| | |
Innox Advanced Materials Co. Ltd. | | | 784 | | | | 15,470 | |
| | |
ISC Co. Ltd. | | | 144 | | | | 7,378 | |
| | |
JA Solar Technology Co. Ltd., Class A | | | 5,292 | | | | 16,227 | |
| | |
JCET Group Co. Ltd., Class A | | | 4,800 | | | | 20,202 | |
| | |
Jentech Precision Industrial Co. Ltd. | | | 1,287 | | | | 22,816 | |
| | |
Jinko Solar Co. Ltd., Class A | | | 16,128 | | | | 20,893 | |
| | |
Jusung Engineering Co. Ltd. | | | 13,066 | | | | 237,511 | |
| | |
King Yuan Electronics Co. Ltd. | | | 32,352 | | | | 76,105 | |
| | |
Kinsus Interconnect Technology Corp. | | | 4,000 | | | | 11,691 | |
| | |
Koh Young Technology, Inc. | | | 1,692 | | | | 13,781 | |
| | |
LEENO Industrial, Inc. | | | 94 | | | | 9,570 | |
| | |
LONGi Green Energy Technology Co. Ltd., Class A | | | 10,448 | | | | 34,450 | |
| | |
LX Semicon Co. Ltd. | | | 235 | | | | 12,459 | |
| | |
M31 Technology Corp. | | | 912 | | | | 24,519 | |
| | |
Macronix International Co. Ltd. | | | 31,104 | | | | 25,892 | |
| | |
Marketech International Corp. | | | 34,824 | | | | 142,259 | |
| | |
MediaTek, Inc. | | | 47,000 | | | | 1,220,102 | |
| | |
Montage Technology Co. Ltd., Class A | | | 1,692 | | | | 12,723 | |
| | |
MPI Corp. | | | 3,838 | | | | 22,364 | |
| | |
Nanya Technology Corp. | | | 21,472 | | | | 42,831 | |
| | |
NAURA Technology Group Co. Ltd., Class A | | | 900 | | | | 31,484 | |
| | |
NEXTIN, Inc. | | | 265 | | | | 10,478 | |
| | |
Novatek Microelectronics Corp. | | | 16,000 | | | | 224,202 | |
| | |
Nuvoton Technology Corp. | | | 4,000 | | | | 15,662 | |
| | |
Pan Jit International, Inc. | | | 8,000 | | | | 14,700 | |
| | |
Parade Technologies Ltd. | | | 1,400 | | | | 45,537 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 265 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Phison Electronics Corp. | | | 2,776 | | | $ | 39,841 | |
| | |
Pixart Imaging, Inc. | | | 7,248 | | | | 28,715 | |
| | |
Powerchip Semiconductor Manufacturing Corp. | | | 47,000 | | | | 38,472 | |
| | |
Powertech Technology, Inc. | | | 20,000 | | | | 64,745 | |
| | |
Radiant Opto-Electronics Corp. | | | 14,330 | | | | 54,784 | |
| | |
Raydium Semiconductor Corp. | | | 1,824 | | | | 20,160 | |
| | |
Realtek Semiconductor Corp. | | | 8,134 | | | | 100,688 | |
| | |
RFHIC Corp. | | | 282 | | | | 2,890 | |
| | |
S&S Tech Corp. | | | 423 | | | | 11,824 | |
| | |
Sanan Optoelectronics Co. Ltd., Class A | | | 4,800 | | | | 9,760 | |
| | |
SDI Corp. | | | 8,000 | | | | 24,788 | |
| | |
Seoul Semiconductor Co. Ltd. | | | 1,911 | | | | 14,235 | |
| | |
SFA Semicon Co. Ltd.* | | | 3,381 | | | | 11,804 | |
| | |
Shanghai Aiko Solar Energy Co. Ltd., Class A | | | 9,800 | | | | 26,247 | |
| | |
Shanghai Fudan Microelectronics Group Co. Ltd., Class A | | | 1,050 | | | | 6,944 | |
| | |
Shanghai Fudan Microelectronics Group Co. Ltd., Class H(a) | | | 4,000 | | | | 7,545 | |
| | |
Shenzhen Xinyichang Technology Co. Ltd., Class A | | | 196 | | | | 2,453 | |
| | |
Sigurd Microelectronics Corp. | | | 173,688 | | | | 317,549 | |
| | |
Silergy Corp. | | | 5,000 | | | | 44,165 | |
| | |
Silicon Integrated Systems Corp. | | | 223,136 | | | | 342,598 | |
| | |
SIMMTECH Co. Ltd. | | | 8,554 | | | | 208,379 | |
| | |
Sino-American Silicon Products, Inc. | | | 16,352 | | | | 82,428 | |
| | |
Sitronix Technology Corp. | | | 2,160 | | | | 18,980 | |
| | |
SK Hynix, Inc. | | | 14,664 | | | | 1,262,762 | |
| | |
Sunplus Technology Co. Ltd. | | | 25,056 | | | | 23,252 | |
| | |
Taiwan Mask Corp. | | | 7,000 | | | | 14,676 | |
| | |
Taiwan Semiconductor Co. Ltd. | | | 9,000 | | | | 21,588 | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 381,496 | | | | 6,222,025 | |
| | |
Taiwan-Asia Semiconductor Corp. | | | 13,000 | | | | 17,956 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
TCL Zhonghuan Renewable Energy Technology Co. Ltd., Class A | | | 5,875 | | | $ | 14,820 | |
| | |
Tokai Carbon Korea Co. Ltd. | | | 86 | | | | 5,279 | |
| | |
Tongwei Co. Ltd., Class A | | | 9,400 | | | | 35,066 | |
| | |
Topco Scientific Co. Ltd. | | | 2,704 | | | | 14,089 | |
| | |
TSEC Corp. | | | 26,708 | | | | 23,385 | |
| | |
Unigroup Guoxin Microelectronics Co. Ltd., Class A* | | | 1,679 | | | | 17,276 | |
| | |
Unisem M Bhd. | | | 14,700 | | | | 9,133 | |
| | |
United Microelectronics Corp. | | | 317,616 | | | | 452,408 | |
| | |
UPI Semiconductor Corp. | | | 2,688 | | | | 19,931 | |
| | |
Vanguard International Semiconductor Corp. | | | 6,000 | | | | 12,967 | |
| | |
Verisilicon Microelectronics Shanghai Co. Ltd., Class A* | | | 528 | | | | 3,849 | |
| | |
Via Technologies, Inc. | | | 5,424 | | | | 19,900 | |
| | |
Visual Photonics Epitaxy Co. Ltd. | | | 7,672 | | | | 34,771 | |
| | |
ViTrox Corp. Bhd. | | | 4,700 | | | | 6,787 | |
| | |
Wafer Works Corp. | | | 11,511 | | | | 15,473 | |
| | |
Will Semiconductor Co. Ltd. Shanghai, Class A | | | 2,025 | | | | 30,524 | |
| | |
Win Semiconductors Corp. | | | 6,961 | | | | 31,119 | |
| | |
Winbond Electronics Corp. | | | 52,232 | | | | 40,178 | |
| | |
WONIK IPS Co. Ltd. | | | 329 | | | | 7,308 | |
| | |
Wonik QnC Corp. | | | 6,345 | | | | 110,640 | |
| | |
Xinjiang Daqo New Energy Co. Ltd., Class A | | | 5,488 | | | | 26,772 | |
| | |
XinTec, Inc. | | | 3,000 | | | | 10,683 | |
| | |
Xinyi Solar Holdings Ltd. | | | 80,000 | | | | 47,031 | |
| | | | | | | 15,390,581 | |
|
Software – 0.3% | |
| | |
360 Security Technology, Inc., Class A* | | | 9,800 | | | | 12,026 | |
| | |
Ahnlab, Inc. | | | 190 | | | | 9,018 | |
| | |
AsiaInfo Technologies Ltd.(b) | | | 21,200 | | | | 21,946 | |
| | |
Beijing Kingsoft Office Software, Inc., Class A | | | 611 | | | | 23,970 | |
| | |
Beijing Shiji Information Technology Co. Ltd., Class A* | | | 6,370 | | | | 9,157 | |
See Accompanying Notes to the Financial Statements.
| | | | |
266 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – (continued) | |
| | |
Birlasoft Ltd. | | | 5,390 | | | $ | 35,454 | |
| | |
Cyient Ltd. | | | 3,290 | | | | 62,768 | |
| | |
Dear U Co. Ltd.* | | | 423 | | | | 9,976 | |
| | |
Douzone Bizon Co. Ltd. | | | 873 | | | | 17,647 | |
| | |
EMRO, Inc.* | | | 294 | | | | 12,016 | |
| | |
Hundsun Technologies, Inc., Class A | | | 4,550 | | | | 19,349 | |
| | |
Iflytek Co. Ltd., Class A | | | 4,800 | | | | 29,883 | |
| | |
Intellect Design Arena Ltd. | | | 4,663 | | | | 38,045 | |
| | |
Kingdee International Software Group Co. Ltd.* | | | 47,000 | | | | 62,350 | |
| | |
KPIT Technologies Ltd. | | | 2,397 | | | | 35,053 | |
| | |
Ming Yuan Cloud Group Holdings Ltd.* (a) | | | 60,000 | | | | 25,075 | |
| | |
NavInfo Co. Ltd., Class A* | | | 4,700 | | | | 6,422 | |
| | |
Oracle Financial Services Software Ltd. | | | 282 | | | | 13,134 | |
| | |
Qi An Xin Technology Group, Inc., Class A* | | | 539 | | | | 3,393 | |
| | |
Route Mobile Ltd. | | | 954 | | | | 17,797 | |
| | |
Shanghai Baosight Software Co. Ltd., Class A | | | 4,212 | | | | 24,559 | |
| | |
Shanghai Baosight Software Co. Ltd., Class B | | | 8,291 | | | | 17,046 | |
| | |
Tanla Platforms Ltd. | | | 1,963 | | | | 22,457 | |
| | |
Tata Elxsi Ltd. | | | 611 | | | | 55,958 | |
| | |
TOTVS SA | | | 4,900 | | | | 24,592 | |
| | |
Weimob, Inc.* (a) (b) | | | 87,000 | | | | 34,913 | |
| | |
Yonyou Network Technology Co. Ltd., Class A | | | 4,700 | | | | 10,514 | |
| | | | | | | 654,518 | |
|
Specialty Retail – 1.5% | |
| | |
Abu Dhabi National Oil Co. for Distribution PJSC | | | 46,436 | | | | 42,479 | |
| | |
Aditya Birla Fashion and Retail Ltd.* | | | 6,536 | | | | 16,858 | |
| | |
Ali Alghanim Sons Automotive Co. KSCC | | | 51,183 | | | | 177,748 | |
| | |
Aurora Design PCL, NVDR | | | 29,300 | | | | 12,880 | |
| | |
Bermaz Auto Bhd. | | | 56,000 | | | | 29,384 | |
| | |
China Tourism Group Duty Free Corp. Ltd., Class A | | | 2,500 | | | | 32,317 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Specialty Retail – (continued) | |
| | |
China Tourism Group Duty Free Corp. Ltd., Class H(a) (b) | | | 2,100 | | | $ | 23,712 | |
| | |
China Yongda Automobiles Services Holdings Ltd. | | | 540,500 | | | | 207,231 | |
| | |
Chow Tai Fook Jewellery Group Ltd. | | | 41,000 | | | | 57,848 | |
| | |
Com7 PCL, NVDR | | | 9,300 | | | | 6,922 | |
| | |
Cuckoo Homesys Co. Ltd. | | | 3,196 | | | | 48,157 | |
| | |
Detsky Mir PJSC* ‡ (b) | | | 258,500 | | | | — | |
| | |
Dogan Sirketler Grubu Holding A/S | | | 39,249 | | | | 18,978 | |
| | |
Dogus Otomotiv Servis ve Ticaret A/S | | | 893 | | | | 7,843 | |
| | |
EEKA Fashion Holdings Ltd. | | | 94,000 | | | | 171,071 | |
| | |
Foschini Group Ltd. (The) | | | 10,575 | | | | 56,810 | |
| | |
FSN E-Commerce Ventures Ltd.* | | | 18,240 | | | | 30,528 | |
| | |
Go Fashion India Ltd.* | | | 1,029 | | | | 15,317 | |
| | |
HLA Group Corp. Ltd., Class A | | | 4,900 | | | | 4,982 | |
| | |
Home Product Center PCL, NVDR | | | 78,600 | | | | 26,023 | |
| | |
Hotai Motor Co. Ltd. | | | 6,120 | | | | 113,777 | |
| | |
Hotel Shilla Co. Ltd. | | | 470 | | | | 21,681 | |
| | |
Italtile Ltd. | | | 154,113 | | | | 94,538 | |
| | |
Jarir Marketing Co. | | | 8,390 | | | | 32,383 | |
| | |
JUMBO SA | | | 2,209 | | | | 58,046 | |
| | |
K Car Co. Ltd. | | | 176 | | | | 1,222 | |
| | |
Lojas Renner SA | | | 28,200 | | | | 68,557 | |
| | |
M.Video PJSC* ‡ | | | 31,680 | | | | — | |
| | |
Map Aktif Adiperkasa PT | | | 2,632,000 | | | | 123,440 | |
| | |
Metro Brands Ltd. | | | 1,128 | | | | 16,088 | |
| | |
Motus Holdings Ltd.(a) | | | 54,990 | | | | 271,388 | |
| | |
MR DIY Group M Bhd.(b) | | | 57,600 | | | | 17,892 | |
| | |
Mr Price Group Ltd. | | | 3,185 | | | | 22,887 | |
| | |
Padini Holdings Bhd. | | | 29,400 | | | | 24,374 | |
| | |
Pan German Universal Motors Ltd. | | | 9,000 | | | | 84,631 | |
| | |
Pepkor Holdings Ltd.(b) | | | 25,185 | | | | 22,838 | |
| | |
Pop Mart International Group Ltd.(b) | | | 9,800 | | | | 26,991 | |
| | |
PTG Energy PCL, NVDR | | | 39,100 | | | | 8,866 | |
| | |
PTT Oil & Retail Business PCL, NVDR | | | 29,400 | | | | 14,969 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 267 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Specialty Retail – (continued) | |
| | |
Shanghai Yuyuan Tourist Mart Group Co. Ltd., Class A | | | 9,400 | | | $ | 8,349 | |
| | |
Shinsegae International, Inc. | | | 5,499 | | | | 63,355 | |
| | |
Siam Global House PCL, NVDR | | | 40,566 | | | | 17,832 | |
| | |
Super Group Ltd. | | | 140,389 | | | | 237,989 | |
| | |
Topsports International Holdings Ltd.(b) | | | 95,000 | | | | 79,889 | |
| | |
Truworths International Ltd. | | | 142,363 | | | | 573,343 | |
| | |
United Electronics Co. | | | 1,619 | | | | 34,567 | |
| | |
Vibra Energia SA | | | 28,200 | | | | 110,664 | |
| | |
Wilcon Depot, Inc. | | | 34,300 | | | | 11,969 | |
| | |
Zhongsheng Group Holdings Ltd. | | | 23,500 | | | | 54,180 | |
| | | | | | | 3,203,793 | |
|
Technology Hardware, Storage & Peripherals – 3.9% | |
| | |
Acer, Inc. | | | 47,000 | | | | 49,413 | |
| | |
Advantech Co. Ltd. | | | 8,734 | | | | 89,265 | |
| | |
Asia Vital Components Co. Ltd. | | | 8,509 | | | | 74,373 | |
| | |
ASROCK, Inc. | | | 2,736 | | | | 15,184 | |
| | |
Asustek Computer, Inc. | | | 20,000 | | | | 208,417 | |
| | |
AURAS Technology Co. Ltd. | | | 3,016 | | | | 26,454 | |
| | |
Catcher Technology Co. Ltd. | | | 14,104 | | | | 78,923 | |
| | |
Chicony Electronics Co. Ltd. | | | 15,992 | | | | 61,384 | |
| | |
China Greatwall Technology Group Co. Ltd., Class A | | | 5,500 | | | | 8,252 | |
| | |
Clevo Co. | | | 188,000 | | | | 181,421 | |
| | |
Compal Electronics, Inc. | | | 94,000 | | | | 81,292 | |
| | |
CosmoAM&T Co. Ltd.* | | | 297 | | | | 30,656 | |
| | |
Darfon Electronics Corp. | | | 69,000 | | | | 92,326 | |
| | |
Elitegroup Computer Systems Co. Ltd. | | | 115,120 | | | | 90,861 | |
| | |
Ennoconn Corp. | | | 36,656 | | | | 281,404 | |
| | |
Getac Holdings Corp. | | | 13,624 | | | | 30,369 | |
| | |
Gigabyte Technology Co. Ltd. | | | 13,880 | | | | 93,075 | |
| | |
HTC Corp.* | | | 11,432 | | | | 15,543 | |
| | |
IEI Integration Corp. | | | 49,000 | | | | 103,484 | |
| | |
Innodisk Corp. | | | 3,301 | | | | 30,328 | |
| | |
Inventec Corp. | | | 84,056 | | | | 104,179 | |
| | |
King Slide Works Co. Ltd. | | | 1,104 | | | | 23,894 | |
| | |
Kinpo Electronics | | | 482,152 | | | | 206,626 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Technology Hardware, Storage & Peripherals – (continued) | |
| | |
Legend Holdings Corp., Class H(b) | | | 239,700 | | | $ | 213,520 | |
| | |
Lenovo Group Ltd. | | | 188,000 | | | | 218,644 | |
| | |
Lite-On Technology Corp. | | | 61,392 | | | | 189,277 | |
| | |
Micro-Star International Co. Ltd. | | | 21,000 | | | | 106,829 | |
| | |
Mitac Holdings Corp. | | | 33,600 | | | | 38,070 | |
| | |
Ninestar Corp., Class A | | | 2,900 | | | | 9,733 | |
| | |
Pegatron Corp. | | | 62,744 | | | | 145,858 | |
| | |
Qisda Corp. | | | 54,000 | | | | 70,507 | |
| | |
Quanta Computer, Inc. | | | 76,232 | | | | 444,207 | |
| | |
Quanta Storage, Inc. | | | 76,952 | | | | 162,042 | |
| | |
Samsung Electronics Co. Ltd. | | | 80,229 | | | | 3,974,174 | |
| | |
Samsung Electronics Co. Ltd. (Preference) | | | 12,460 | | | | 494,507 | |
| | |
Shenzhen Transsion Holdings Co. Ltd., Class A | | | 1,316 | | | | 24,126 | |
| | |
Wistron Corp. | | | 79,640 | | | | 219,510 | |
| | |
Wiwynn Corp. | | | 3,000 | | | | 140,589 | |
| | | | | | | 8,428,716 | |
|
Textiles, Apparel & Luxury Goods – 1.3% | |
| | |
361 Degrees International Ltd. | | | 376,000 | | | | 183,084 | |
| | |
Aksa Akrilik Kimya Sanayii A/S | | | 2,021 | | | | 6,329 | |
| | |
Alok Industries Ltd.* | | | 23,980 | | | | 5,012 | |
| | |
Alpargatas SA (Preference)* | | | 5,500 | | | | 8,998 | |
| | |
ANTA Sports Products Ltd. | | | 18,800 | | | | 212,277 | |
| | |
Arezzo Industria e Comercio SA | | | 2,557 | | | | 29,606 | |
| | |
Bata India Ltd. | | | 848 | | | | 15,950 | |
| | |
Bosideng International Holdings Ltd. | | | 54,000 | | | | 21,325 | |
| | |
Eclat Textile Co. Ltd. | | | 3,546 | | | | 56,194 | |
| | |
F&F Co. Ltd. | | | 245 | | | | 16,944 | |
| | |
Feng TAY Enterprise Co. Ltd. | | | 11,872 | | | | 65,335 | |
| | |
FF Group* ‡ | | | 3,536 | | | | — | |
| | |
Fila Holdings Corp. | | | 1,167 | | | | 30,891 | |
| | |
Fuguiniao Group Ltd.* ‡ | | | 334,800 | | | | — | |
| | |
Fulgent Sun International Holding Co. Ltd. | | | 51,320 | | | | 203,318 | |
| | |
Golden Solar New Energy Technology Holdings Ltd.* | | | 42,000 | | | | 33,763 | |
| | |
Grendene SA | | | 8,264 | | | | 10,160 | |
| | |
Grupo de Moda Soma SA | | | 19,200 | | | | 20,140 | |
| | |
Handsome Co. Ltd. | | | 3,713 | | | | 51,329 | |
See Accompanying Notes to the Financial Statements.
| | | | |
268 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Textiles, Apparel & Luxury Goods – (continued) | |
| | |
Hansae Co. Ltd. | | | 5,405 | | | $ | 91,447 | |
| | |
Kalyan Jewellers India Ltd. | | | 8,976 | | | | 31,124 | |
| | |
KPR Mill Ltd. | | | 1,754 | | | | 16,960 | |
| | |
Lao Feng Xiang Co. Ltd., Class B | | | 7,400 | | | | 25,049 | |
| | |
Li Ning Co. Ltd. | | | 33,500 | | | | 102,753 | |
| | |
Makalot Industrial Co. Ltd. | | | 4,334 | | | | 48,304 | |
| | |
Mavi Giyim Sanayi ve Ticaret A/S, Class B(b) | | | 59,408 | | | | 200,527 | |
| | |
Page Industries Ltd. | | | 114 | | | | 51,779 | |
| | |
Pou Chen Corp. | | | 72,320 | | | | 64,327 | |
| | |
Quang Viet Enterprise Co. Ltd. | | | 24,912 | | | | 84,871 | |
| | |
Rajesh Exports Ltd.* | | | 2,600 | | | | 14,010 | |
| | |
Raymond Ltd. | | | 1,316 | | | | 27,826 | |
| | |
Relaxo Footwears Ltd. | | | 987 | | | | 10,645 | |
| | |
Ruentex Industries Ltd. | | | 28,819 | | | | 50,823 | |
| | |
Shenzhou International Group Holdings Ltd. | | | 14,100 | | | | 138,304 | |
| | |
Shinkong Textile Co. Ltd. | | | 94,000 | | | | 127,806 | |
| | |
Swan Energy Ltd. | | | 2,940 | | | | 13,616 | |
| | |
Tainan Spinning Co. Ltd. | | | 49,000 | | | | 21,452 | |
| | |
Taiwan Paiho Ltd. | | | 94,000 | | | | 166,351 | |
| | |
Titan Co. Ltd. | | | 6,392 | | | | 244,878 | |
| | |
Trident Ltd. | | | 22,165 | | | | 9,291 | |
| | |
Vardhman Textiles Ltd. | | | 42,817 | | | | 189,841 | |
| | |
VIP Industries Ltd. | | | 3,025 | | | | 22,139 | |
| | |
Vivara Participacoes SA | | | 5,300 | | | | 26,800 | |
| | |
Welspun India Ltd. | | | 7,370 | | | | 13,313 | |
| | |
Xtep International Holdings Ltd.(a) | | | 27,500 | | | | 24,953 | |
| | |
Youngone Corp. | | | 480 | | | | 19,299 | |
| | |
Youngone Holdings Co. Ltd. | | | 2,021 | | | | 117,021 | |
| | | | | | | 2,926,164 | |
|
Tobacco – 0.3% | |
| | |
British American Tobacco Malaysia Bhd. | | | 61,100 | | | | 120,546 | |
| | |
Eastern Co. SAE | | | 27,721 | | | | 23,575 | |
| | |
Godfrey Phillips India Ltd. | | | 490 | | | | 13,324 | |
| | |
Gudang Garam Tbk. PT | | | 14,900 | | | | 21,832 | |
| | |
ITC Ltd. | | | 44,697 | | | | 229,984 | |
| | |
KT&G Corp. | | | 2,632 | | | | 166,236 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Tobacco – (continued) | |
| | |
RLX Technology, Inc., ADR* (a) | | | 15,484 | | | $ | 26,323 | |
| | |
Smoore International Holdings Ltd.(b) | | | 33,000 | | | | 25,431 | |
| | | | | | | 627,251 | |
|
Trading Companies & Distributors – 0.4% | |
| | |
Adani Enterprises Ltd. | | | 5,687 | | | | 156,736 | |
| | |
ALAFCO Aviation Lease & Finance Co. KSCP* | | | 3,260 | | | | 1,748 | |
| | |
Armac Locacao Logistica E Servicos SA | | | 5,000 | | | | 12,027 | |
| | |
Barloworld Ltd. | | | 54,896 | | | | 229,547 | |
| | |
BOC Aviation Ltd.(a) (b) | | | 5,100 | | | | 31,351 | |
| | |
Chin Hin Group Bhd.* | | | 9,400 | | | | 7,517 | |
| | |
COSCO SHIPPING Development Co. Ltd., Class A | | | 37,600 | | | | 11,817 | |
| | |
COSCO SHIPPING Development Co. Ltd., Class H | | | 240,000 | | | | 24,538 | |
| | |
IndiaMart InterMesh Ltd.(b) | | | 1,013 | | | | 32,237 | |
| | |
LX International Corp. | | | 800 | | | | 14,720 | |
| | |
Posco International Corp. | | | 1,081 | | | | 40,101 | |
| | |
Realord Group Holdings Ltd.* (a) | | | 14,000 | | | | 10,324 | |
| | |
Shanxi Coal International Energy Group Co. Ltd., Class A | | | 4,900 | | | | 10,901 | |
| | |
SK Networks Co. Ltd. | | | 44,556 | | | | 183,760 | |
| | |
Xiamen C & D, Inc., Class A | | | 9,400 | | | | 12,575 | |
| | | | | | | 779,899 | |
|
Transportation Infrastructure – 0.8% | |
| | |
Abu Dhabi Ports Co. PJSC* | | | 13,395 | | | | 21,772 | |
| | |
Adani Ports & Special Economic Zone Ltd. | | | 10,716 | | | | 101,003 | |
| | |
Airports of Thailand PCL* | | | 54,000 | | | | 100,285 | |
| | |
Airports of Thailand PCL, NVDR* | | | 11,800 | | | | 21,914 | |
| | |
Bangkok Expressway & Metro PCL, NVDR | | | 148,000 | | | | 32,530 | |
| | |
Beijing Capital International Airport Co. Ltd., Class H* | | | 56,000 | | | | 20,612 | |
| | |
CCR SA | | | 19,182 | | | | 45,568 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 269 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Transportation Infrastructure – (continued) | |
| | |
China Merchants Expressway Network & Technology Holdings Co. Ltd., Class A | | | 9,600 | | | $ | 12,239 | |
| | |
China Merchants Port Holdings Co. Ltd. | | | 40,521 | | | | 51,528 | |
| | |
COSCO SHIPPING Ports Ltd. | | | 51,348 | | | | 30,909 | |
| | |
EcoRodovias Infraestrutura e Logistica SA | | | 89,300 | | | | 124,308 | |
| | |
Evergreen International Storage & Transport Corp. | | | 16,000 | | | | 14,725 | |
| | |
GMR Airports Infrastructure Ltd.* | | | 48,418 | | | | 31,752 | |
| | |
Grupo Aeroportuario del Centro Norte SAB de CV, Class B | | | 4,700 | | | | 35,831 | |
| | |
Grupo Aeroportuario del Pacifico SAB de CV, Class B | | | 5,506 | | | | 64,143 | |
| | |
Grupo Aeroportuario del Sureste SAB de CV, Class B | | | 3,280 | | | | 70,595 | |
| | |
Guangdong Provincial Expressway Development Co. Ltd., Class B | | | 9,800 | | | | 7,527 | |
| | |
International Container Terminal Services, Inc. | | | 15,510 | | | | 54,998 | |
| | |
Jasa Marga Persero Tbk. PT | | | 39,723 | | | | 10,653 | |
| | |
Jiangsu Expressway Co. Ltd., Class H | | | 32,000 | | | | 29,118 | |
| | |
Malaysia Airports Holdings Bhd. | | | 16,908 | | | | 26,225 | |
| | |
National Marine Dredging Co.* | | | 3,341 | | | | 19,757 | |
| | |
Ningbo Zhoushan Port Co. Ltd., Class A | | | 23,500 | | | | 11,079 | |
| | |
Novorossiysk Commercial Sea Port PJSC‡ | | | 189,696 | | | | — | |
| | |
Promotora y Operadora de Infraestructura SAB de CV | | | 2,160 | | | | 17,658 | |
| | |
Qingdao Port International Co. Ltd., Class H(b) | | | 49,000 | | | | 24,486 | |
| | |
Salik Co. PJSC | | | 24,346 | | | | 21,144 | |
| | |
Santos Brasil Participacoes SA | | | 27,200 | | | | 39,913 | |
| | |
Saudi Ground Services Co.* | | | 4,431 | | | | 34,429 | |
| | |
Shanghai International Airport Co. Ltd., Class A* | | | 3,600 | | | | 18,305 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Transportation Infrastructure – (continued) | |
| | |
Shanghai International Port Group Co. Ltd., Class A | | | 55,600 | | | $ | 37,988 | |
| | |
Shenzhen International Holdings Ltd. | | | 24,500 | | | | 16,125 | |
| | |
Sociedad Matriz SAAM SA | | | 1,554,996 | | | | 171,450 | |
| | |
Taiwan High Speed Rail Corp. | | | 48,000 | | | | 43,508 | |
| | |
TangShan Port Group Co. Ltd., Class A | | | 4,900 | | | | 2,384 | |
| | |
TAV Havalimanlari Holding A/S* | | | 2,961 | | | | 11,993 | |
| | |
Westports Holdings Bhd. | | | 17,500 | | | | 12,341 | |
| | |
Wilson Sons SA | | | 14,400 | | | | 38,463 | |
| | |
Zhejiang Expressway Co. Ltd., Class H(a) | | | 470,000 | | | | 353,794 | |
| | | | | | | 1,783,052 | |
|
Water Utilities - 0.7% | |
| | |
Aguas Andinas SA, Class A | | | 1,092,562 | | | | 317,584 | |
| | |
AlKhorayef Water & Power Technologies Co. | | | 294 | | | | 10,721 | |
| | |
Athens Water Supply & Sewage Co. SA | | | 1,372 | | | | 8,136 | |
| | |
Beijing Capital Eco-Environment Protection Group Co. Ltd., Class A | | | 24,000 | | | | 9,052 | |
| | |
Beijing Enterprises Water Group Ltd. | | | 132,000 | | | | 27,835 | |
| | |
China Water Affairs Group Ltd. | | | 350,000 | | | | 221,417 | |
| | |
Cia de Saneamento Basico do Estado de Sao Paulo SABESP | | | 4,700 | | | | 54,400 | |
| | |
Cia de Saneamento de Minas Gerais Copasa MG | | | 75,200 | | | | 237,693 | |
| | |
Cia de Saneamento do Parana | | | 94,000 | | | | 405,413 | |
| | |
Emirates Central Cooling Systems Corp. | | | 34,496 | | | | 16,811 | |
| | |
Guangdong Investment Ltd. | | | 94,000 | | | | 64,152 | |
| | |
Manila Water Co., Inc. | | | 441,800 | | | | 131,746 | |
| | |
National Central Cooling Co. PJSC | | | 5,029 | | | | 4,792 | |
| | | | | | | 1,509,752 | |
|
Wireless Telecommunication Services - 0.8% | |
| | |
Advanced Info Service PCL, NVDR | | | 14,100 | | | | 86,304 | |
See Accompanying Notes to the Financial Statements.
| | | | |
270 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Axiata Group Bhd. | | | 49,004 | | | $ | 22,422 | |
| | |
Bharti Airtel Ltd. | | | 39,339 | | | | 432,046 | |
| | |
Celcomdigi Bhd. | | | 42,300 | | | | 37,555 | |
| | |
Empresa Nacional de Telecomunicaciones SA | | | 55,272 | | | | 185,619 | |
| | |
Etihad Etisalat Co. | | | 7,322 | | | | 89,973 | |
| | |
Far EasTone Telecommunications Co. Ltd. | | | 27,032 | | | | 63,257 | |
| | |
Globe Telecom, Inc. | | | 980 | | | | 30,398 | |
| | |
Indosat Tbk. PT | | | 31,800 | | | | 18,918 | |
| | |
Intouch Holdings PCL, NVDR | | | 18,800 | | | | 37,137 | |
| | |
Kuwait Telecommunications Co. | | | 3,699 | | | | 6,333 | |
| | |
Maxis Bhd. | | | 32,900 | | | | 27,345 | |
| | |
Mobile Telecommunications Co. KSCP | | | 60,348 | | | | 93,773 | |
| | |
Mobile Telecommunications Co. Saudi Arabia | | | 8,508 | | | | 31,296 | |
| | |
Mobile TeleSystems PJSC‡ | | | 31,356 | | | | — | |
| | |
MTN Group Ltd. | | | 45,214 | | | | 219,427 | |
| | |
PLDT, Inc. | | | 2,625 | | | | 55,979 | |
| | |
Sistema PJSFC‡ | | | 122,643 | | | | — | |
| | |
SK Telecom Co. Ltd. | | | 2,679 | | | | 97,496 | |
| | |
Smartfren Telecom Tbk. PT* | | | 4,635,400 | | | | 15,174 | |
| | |
Taiwan Mobile Co. Ltd. | | | 28,904 | | | | 85,371 | |
| | |
TIM SA | | | 14,100 | | | | 42,415 | |
| | |
Turkcell Iletisim Hizmetleri A/S* | | | 27,401 | | | | 46,487 | |
| | |
Vodacom Group Ltd. | | | 11,515 | | | | 62,320 | |
| | |
Vodafone Idea Ltd.* | | | 219,456 | | | | 31,234 | |
| | |
Vodafone Qatar QSC | | | 44,198 | | | | 21,607 | |
| | |
XL Axiata Tbk. PT | | | 102,900 | | | | 14,705 | |
| | | | | | | 1,854,591 | |
Total Common Stocks (Cost $212,305,889) | | | | 218,902,084 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 0.0%(d) | |
|
Independent Power and Renewable Electricity Producers – 0.0%(d) | |
| | |
NTPC Ltd. Series 54, 8.49%, 3/25/2025 (Cost $–) | | | INR 39,301 | | | $ | 4,971 | |
| | Number of Rights | | | | |
|
RIGHTS – 0.0%(d) | |
|
Banks – 0.0%(d) | |
| | |
Gulf Bank KSCP, expiring 11/12/2023, price 0.23 KWD* | | | 3,505 | | | | 72 | |
|
Biotechnology – 0.0% | |
| | |
Vaxcell-Bio Therapeutics Co. Ltd., expiring 11/1/2023, price 23,850.00 KRW* ‡ | | | 95 | | | | — | |
|
Ground Transportation – 0.0%(d) | |
| | |
Localiza Rent a Car SA, expiring 11/10/2023, price 47.13 BRL* | | | 88 | | | | 122 | |
|
Health Care Technology – 0.0% | |
| | |
Lunit, Inc., expiring 11/1/2023, price 153,500.00 KRW* ‡ | | | 50 | | | | — | |
|
Machinery – 0.0%(d) | |
| | |
Hanwha Ocean Co. Ltd., expiring 11/8/2023, price 21,850.00 KRW* | | | 232 | | | | 301 | |
|
Semiconductors & Semiconductor Equipment – 0.0%(d) | |
| | |
Gudeng Precision Industrial Co. Ltd., expiring 11/27/2023, price 300 TWD* | | | 84 | | | | 93 | |
| | |
Winbond Electronics Corp., expiring 10/26/2023, price 22 TWD* | | | 2,139 | | | | 195 | |
| | | | | | | 288 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 271 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
| | | | | | | | |
Investments | | Number of Rights | | | Value | |
|
RIGHTS – (continued) | |
|
Technology Hardware, Storage & Peripherals – 0.0%(d) | |
| | |
CosmoAM&T Co. Ltd., expiring 11/6/2023, price 122,800.00 KRW* | | | 15 | | | $ | 184 | |
Total Rights (cost $–) | | | | 967 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 0.3%(e) | |
|
REPURCHASE AGREEMENTS – 0.3% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $677,414, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $685,017 (Cost $677,315) | | $ | 677,315 | | | | 677,315 | |
Total Investments – 100.4% (Cost $212,983,204) | | | | 219,585,337 | |
| |
Liabilities in excess of other assets – (0.4%) | | | | (861,812 | ) |
NET ASSETS – 100.0% | | | $ | 218,723,525 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $5,168,593, collateralized in the form of cash with a value of $677,315 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $4,058,892 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 7, 2023 – May 15, 2053 and $780,668 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $5,516,875. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(d) | Represents less than 0.05% of net assets. |
(e) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $677,315. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
GDR – Global Depositary Receipt
NVDR – Non-Voting Depositary Receipt
OJSC – Open Joint Stock Company
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA – Limited partnership with share capital
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 42,941,915 | |
Aggregate gross unrealized depreciation | | | (41,755,857 | ) |
Net unrealized appreciation | | $ | 1,186,058 | |
Federal income tax cost | | $ | 218,353,325 | |
See Accompanying Notes to the Financial Statements.
| | | | |
272 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
Futures Contracts
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | |
MSCI Emerging Markets E-Mini Index | | | 20 | | | | 12/15/2023 | | | | USD | | | $ | 919,200 | | | $ | (51,792 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | | | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 351,469 | | | | | BNP Paribas SA | | HKD | | | 2,746,137 | | | | 12/20/2023 | | | $ | 222 | |
USD | | | 106,238 | | | | | Citibank NA | | INR* | | | 8,848,500 | | | | 12/20/2023 | | | | 100 | |
USD | | | 99,806 | | | | | Citibank NA | | KRW* | | | 131,816,590 | | | | 12/20/2023 | | | | 1,931 | |
USD | | | 256,908 | | | | | Morgan Stanley | | TWD* | | | 8,156,120 | | | | 12/20/2023 | | | | 3,918 | |
Total unrealized appreciation | | | | | | | $ | 6,171 | |
USD | | | 24,632 | | | | | BNP Paribas SA | | ZAR | | | 470,000 | | | | 12/20/2023 | | | $ | (333 | ) |
Total unrealized depreciation | | | | | | | $ | (333 | ) |
Net unrealized appreciation | | | | | | | $ | 5,838 | |
* | Non-deliverable forward. See Note 2 in the Notes to Financial Statements. |
Abbreviations:
HKD – Hong Kong Dollar
INR – Indian Rupee
KRW – Korean Won
TWD – Taiwan Dollar
USD – US Dollar
ZAR – South African Rand
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 273 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)
FlexShares® Morningstar Emerging Markets Factor Tilt Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Brazil | | | 6.6 | % |
Chile | | | 1.1 | |
China | | | 23.5 | |
Colombia | | | 0.6 | |
Czech Republic | | | 0.4 | |
Egypt | | | 0.5 | |
Greece | | | 0.5 | |
Hungary | | | 0.3 | |
India | | | 14.4 | |
Indonesia | | | 2.4 | |
Kuwait | | | 0.7 | |
Malaysia | | | 2.6 | |
Mexico | | | 2.2 | |
Peru | | | 0.3 | |
Philippines | | | 0.9 | |
Qatar | | | 1.2 | |
Saudi Arabia | | | 2.7 | |
South Africa | | | 4.0 | |
South Korea | | | 11.9 | |
Taiwan | | | 15.9 | |
Thailand | | | 2.0 | |
Turkey | | | 2.1 | |
United Arab Emirates | | | 2.8 | |
United Kingdom | | | 0.0 | † |
United States | | | 0.5 | |
Other1 | | | (0.1 | ) |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 100.1 | % |
Corporate Bonds | | | 0.0 | † |
Rights | | | 0.0 | † |
Securities Lending Reinvestments | | | 0.3 | |
Others(1) | | | (0.4 | ) |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
274 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® US Quality Large Cap Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.3% | |
|
Aerospace & Defense – 0.7% | |
| | |
Lockheed Martin Corp. | | | 2,268 | | | $ | 1,031,124 | |
| | |
Textron, Inc. | | | 504 | | | | 38,304 | |
| | | | | | | 1,069,428 | |
|
Air Freight & Logistics – 1.2% | |
| | |
Expeditors International of Washington, Inc. | | | 6,678 | | | | 729,572 | |
| | |
United Parcel Service, Inc., Class B | | | 7,686 | | | | 1,085,647 | |
| | | | | | | 1,815,219 | |
|
Automobiles – 1.1% | |
| | |
Tesla, Inc.* | | | 8,064 | | | | 1,619,574 | |
|
Banks – 3.5% | |
| | |
Bank of America Corp. | | | 28,602 | | | | 753,377 | |
| | |
Citigroup, Inc. | | | 34,146 | | | | 1,348,425 | |
| | |
JPMorgan Chase & Co. | | | 17,766 | | | | 2,470,540 | |
| | |
Wells Fargo & Co. | | | 12,726 | | | | 506,113 | |
| | | | | | | 5,078,455 | |
|
Beverages – 0.2% | |
| | |
Molson Coors Beverage Co., Class B | | | 4,914 | | | | 283,882 | |
|
Biotechnology – 2.2% | |
| | |
AbbVie, Inc. | | | 2,268 | | | | 320,196 | |
| | |
Amgen, Inc. | | | 8,064 | | | | 2,061,965 | |
| | |
Biogen, Inc.* | | | 252 | | | | 59,860 | |
| | |
Gilead Sciences, Inc. | | | 3,654 | | | | 286,985 | |
| | |
Regeneron Pharmaceuticals, Inc.* | | | 186 | | | | 145,060 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 1,008 | | | | 365,007 | |
| | | | | | | 3,239,073 | |
|
Broadline Retail – 2.8% | |
| | |
Amazon.com, Inc.* | | | 22,050 | | | | 2,934,635 | |
| | |
eBay, Inc. | | | 16,254 | | | | 637,644 | |
| | |
Etsy, Inc.* (a) | | | 1,008 | | | | 62,798 | |
| | |
MercadoLibre, Inc.* | | | 431 | | | | 534,759 | |
| | | | | | | 4,169,836 | |
|
Building Products – 0.5% | |
| | |
A O Smith Corp. | | | 2,520 | | | | 175,795 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Building Products – (continued) | |
| | |
Builders FirstSource, Inc.* | | | 2,394 | | | $ | 259,797 | |
| | |
Masco Corp. | | | 6,300 | | | | 328,167 | |
| | | | | | | 763,759 | |
|
Capital Markets – 1.7% | |
| | |
Ameriprise Financial, Inc. | | | 504 | | | | 158,543 | |
| | |
Bank of New York Mellon Corp. (The) | | | 19,782 | | | | 840,735 | |
| | |
Goldman Sachs Group, Inc. (The) | | | 882 | | | | 267,784 | |
| | |
Morgan Stanley | | | 10,584 | | | | 749,559 | |
| | |
Robinhood Markets, Inc., Class A* (a) | | | 14,364 | | | | 131,287 | |
| | |
State Street Corp. | | | 5,670 | | | | 366,452 | |
| | | | | | | 2,514,360 | |
|
Chemicals – 0.9% | |
| | |
CF Industries Holdings, Inc. | | | 3,654 | | | | 291,516 | |
| | |
Dow, Inc. | | | 14,364 | | | | 694,356 | |
| | |
LyondellBasell Industries NV, Class A | | | 2,772 | | | | 250,145 | |
| | |
Mosaic Co. (The) | | | 1,638 | | | | 53,202 | |
| | | | | | | 1,289,219 | |
|
Communications Equipment – 1.6% | |
| | |
Cisco Systems, Inc. | | | 45,738 | | | | 2,384,322 | |
|
Consumer Finance – 1.2% | |
| | |
Capital One Financial Corp. | | | 7,812 | | | | 791,278 | |
| | |
Discover Financial Services | | | 5,418 | | | | 444,709 | |
| | |
Synchrony Financial | | | 18,144 | | | | 508,939 | |
| | | | | | | 1,744,926 | |
|
Consumer Staples Distribution & Retail – 0.5% | |
| | |
Kroger Co. (The) | | | 17,010 | | | | 771,744 | |
|
Diversified Telecommunication Services – 0.7% | |
| | |
AT&T, Inc. | | | 71,820 | | | | 1,106,028 | |
|
Electric Utilities – 2.2% | |
| | |
Constellation Energy Corp. | | | 2,898 | | | | 327,242 | |
| | |
Evergy, Inc.(a) | | | 756 | | | | 37,150 | |
| | |
Exelon Corp. | | | 20,286 | | | | 789,937 | |
| | |
PPL Corp. | | | 28,224 | | | | 693,464 | |
| | |
Southern Co. (The) | | | 19,782 | | | | 1,331,328 | |
| | | | | | | 3,179,121 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 275 | |
FlexShares® US Quality Large Cap Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electrical Equipment – 0.3% | |
| | |
Emerson Electric Co. | | | 1,512 | | | $ | 134,523 | |
| | |
Hubbell, Inc., Class B | | | 1,134 | | | | 306,293 | |
| | | | | | | 440,816 | |
|
Electronic Equipment, Instruments & Components – 0.4% | |
| | |
Jabil, Inc. | | | 4,410 | | | | 541,548 | |
|
Entertainment – 0.4% | |
| | |
Atlanta Braves Holdings, Inc., Class C* | | | 1 | | | | 24 | |
| | |
Electronic Arts, Inc. | | | 3,780 | | | | 467,926 | |
| | |
Liberty Media Corp-Liberty Formula One, Class C* | | | 630 | | | | 40,755 | |
| | |
Warner Bros Discovery, Inc.* | | | 2,646 | | | | 26,301 | |
| | | | | | | 535,006 | |
|
Financial Services – 4.2% | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 10,458 | | | | 3,569,629 | |
| | |
Fidelity National Information Services, Inc. | | | 5,796 | | | | 284,642 | |
| | |
Fiserv, Inc.* | | | 5,040 | | | | 573,300 | |
| | |
PayPal Holdings, Inc.* | | | 4,032 | | | | 208,858 | |
| | |
Toast, Inc., Class A* (a) | | | 2,394 | | | | 38,280 | |
| | |
Visa, Inc., Class A(a) | | | 6,174 | | | | 1,451,507 | |
| | | | | | | 6,126,216 | |
|
Food Products – 1.0% | |
| | |
Archer-Daniels-Midland Co. | | | 882 | | | | 63,125 | |
| | |
Campbell Soup Co. | | | 7,182 | | | | 290,225 | |
| | |
General Mills, Inc. | | | 11,214 | | | | 731,601 | |
| | |
Hershey Co. (The) | | | 1,638 | | | | 306,879 | |
| | |
Kraft Heinz Co. (The) | | | 2,394 | | | | 75,315 | |
| | | | | | | 1,467,145 | |
|
Ground Transportation – 0.1% | |
| | |
Old Dominion Freight Line, Inc. | | | 252 | | | | 94,918 | |
|
Health Care Equipment & Supplies – 0.8% | |
| | |
Abbott Laboratories | | | 2,394 | | | | 226,353 | |
| | |
Align Technology, Inc.* | | | 630 | | | | 116,292 | |
| | |
Hologic, Inc.* | | | 5,544 | | | | 366,846 | |
| | |
IDEXX Laboratories, Inc.* | | | 1,067 | | | | 426,234 | |
| | | | | | | 1,135,725 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Providers & Services – 4.8% | |
| | |
Cardinal Health, Inc. | | | 7,308 | | | $ | 665,028 | |
| | |
Cencora, Inc. | | | 2,898 | | | | 536,565 | |
| | |
Centene Corp.* | | | 1,386 | | | | 95,606 | |
| | |
Cigna Group (The) | | | 2,898 | | | | 896,062 | |
| | |
CVS Health Corp. | | | 9,450 | | | | 652,144 | |
| | |
Elevance Health, Inc. | | | 630 | | | | 283,557 | |
| | |
HCA Healthcare, Inc. | | | 1,134 | | | | 256,443 | |
| | |
Laboratory Corp. of America Holdings | | | 2,898 | | | | 578,817 | |
| | |
McKesson Corp. | | | 2,646 | | | | 1,204,883 | |
| | |
Quest Diagnostics, Inc. | | | 1,890 | | | | 245,889 | |
| | |
UnitedHealth Group, Inc. | | | 2,963 | | | | 1,586,864 | |
| | | | | | | 7,001,858 | |
|
Health Care REITs – 0.1% | |
| | |
Healthpeak Properties, Inc., REIT | | | 7,182 | | | | 111,680 | |
|
Hotel & Resort REITs – 0.5% | |
| | |
Host Hotels & Resorts, Inc., REIT | | | 45,360 | | | | 702,173 | |
|
Hotels, Restaurants & Leisure – 1.9% | |
| | |
Airbnb, Inc., Class A* (a) | | | 3,402 | | | | 402,423 | |
| | |
Booking Holdings, Inc.* | | | 278 | | | | 775,498 | |
| | |
Caesars Entertainment, Inc.* | | | 3,276 | | | | 130,680 | |
| | |
Carnival Corp.* (a) | | | 21,924 | | | | 251,249 | |
| | |
DoorDash, Inc., Class A* | | | 3,024 | | | | 226,649 | |
| | |
DraftKings, Inc., Class A* (a) | | | 9,954 | | | | 274,929 | |
| | |
Expedia Group, Inc.* | | | 756 | | | | 72,039 | |
| | |
Royal Caribbean Cruises Ltd.* | | | 3,276 | | | | 277,575 | |
| | |
Yum! Brands, Inc. | | | 3,276 | | | | 395,937 | |
| | | | | | | 2,806,979 | |
|
Household Durables – 0.9% | |
| | |
Lennar Corp., Class A | | | 6,174 | | | | 658,642 | |
| | |
NVR, Inc.* | | | 134 | | | | 725,291 | |
| | | | | | | 1,383,933 | |
|
Household Products – 2.1% | |
| | |
Colgate-Palmolive Co. | | | 7,308 | | | | 548,977 | |
| | |
Kimberly-Clark Corp. | | | 1,386 | | | | 165,821 | |
| | |
Procter & Gamble Co. (The) | | | 15,624 | | | | 2,344,069 | |
| | | | | | | 3,058,867 | |
See Accompanying Notes to the Financial Statements.
| | | | |
276 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® US Quality Large Cap Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – 0.8% | |
| | |
3M Co. | | | 2,016 | | | $ | 183,355 | |
| | |
General Electric Co. | | | 9,324 | | | | 1,012,866 | |
| | | | | | | 1,196,221 | |
|
Insurance – 2.2% | |
| | |
Aflac, Inc. | | | 12,348 | | | | 964,503 | |
| | |
American International Group, Inc. | | | 15,246 | | | | 934,732 | |
| | |
Arch Capital Group Ltd.* | | | 1,134 | | | | 98,295 | |
| | |
MetLife, Inc. | | | 13,608 | | | | 816,616 | |
| | |
Prudential Financial, Inc. | | | 4,536 | | | | 414,772 | |
| | | | | | | 3,228,918 | |
|
Interactive Media & Services – 7.6% | |
| | |
Alphabet, Inc., Class A* | | | 35,910 | | | | 4,455,713 | |
| | |
Alphabet, Inc., Class C* | | | 33,516 | | | | 4,199,555 | |
| | |
Meta Platforms, Inc., Class A* | | | 8,316 | | | | 2,505,361 | |
| | | | | | | 11,160,629 | |
|
IT Services – 1.8% | |
| | |
Accenture plc, Class A | | | 4,410 | | | | 1,310,167 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 9,450 | | | | 609,241 | |
| | |
Gartner, Inc.* | | | 2,016 | | | | 669,393 | |
| | | | | | | 2,588,801 | |
|
Life Sciences Tools & Services – 0.5% | |
| | |
Danaher Corp. | | | 504 | | | | 96,778 | |
| | |
Mettler-Toledo International, Inc.* | | | 548 | | | | 539,890 | |
| | |
Waters Corp.* | | | 630 | | | | 150,274 | |
| | | | | | | 786,942 | |
|
Machinery – 2.0% | |
| | |
Caterpillar, Inc. | | | 5,166 | | | | 1,167,774 | |
| | |
Illinois Tool Works, Inc. | | | 5,922 | | | | 1,327,238 | |
| | |
PACCAR, Inc. | | | 4,158 | | | | 343,160 | |
| | |
Snap-on, Inc. | | | 504 | | | | 130,002 | |
| | | | | | | 2,968,174 | |
|
Media – 1.8% | |
| | |
Comcast Corp., Class A | | | 24,696 | | | | 1,019,698 | |
| | |
Fox Corp., Class A | | | 24,192 | | | | 735,195 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | 8,064 | | | | 229,017 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Media – (continued) | |
| | |
Omnicom Group, Inc. | | | 8,190 | | | $ | 613,513 | |
| | | | | | | 2,597,423 | |
|
Metals & Mining – 1.8% | |
| | |
Freeport-McMoRan, Inc. | | | 7,812 | | | | 263,890 | |
| | |
Nucor Corp. | | | 5,544 | | | | 819,348 | |
| | |
Reliance Steel & Aluminum Co. | | | 3,024 | | | | 769,245 | |
| | |
Steel Dynamics, Inc. | | | 6,930 | | | | 738,114 | |
| | | | | | | 2,590,597 | |
|
Multi-Utilities – 1.7% | |
| | |
Consolidated Edison, Inc. | | | 9,954 | | | | 873,862 | |
| | |
DTE Energy Co. | | | 8,064 | | | | 777,208 | |
| | |
Public Service Enterprise Group, Inc. | | | 14,616 | | | | 901,076 | |
| | | | | | | 2,552,146 | |
|
Oil, Gas & Consumable Fuels – 2.8% | |
| | |
EQT Corp.(a) | | | 8,190 | | | | 347,092 | |
| | |
Exxon Mobil Corp. | | | 7,434 | | | | 786,889 | |
| | |
Marathon Oil Corp. | | | 8,946 | | | | 244,315 | |
| | |
Marathon Petroleum Corp. | | | 7,812 | | | | 1,181,565 | |
| | |
Occidental Petroleum Corp.(a) | | | 12,348 | | | | 763,230 | |
| | |
Valero Energy Corp.(a) | | | 5,670 | | | | 720,090 | |
| | | | | | | 4,043,181 | |
|
Pharmaceuticals – 4.9% | |
| | |
Bristol-Myers Squibb Co. | | | 18,144 | | | | 934,960 | |
| | |
Eli Lilly & Co. | | | 4,842 | | | | 2,682,129 | |
| | |
Johnson & Johnson | | | 20,034 | | | | 2,971,844 | |
| | |
Merck & Co., Inc. | | | 3,654 | | | | 375,266 | |
| | |
Pfizer, Inc. | | | 10,080 | | | | 308,045 | |
| | | | | | | 7,272,244 | |
|
Professional Services – 0.2% | |
| | |
Automatic Data Processing, Inc. | | | 378 | | | | 82,487 | |
| | |
Leidos Holdings, Inc. | | | 504 | | | | 49,957 | |
| | |
Paychex, Inc. | | | 2,142 | | | | 237,869 | |
| | | | | | | 370,313 | |
|
Real Estate Management & Development – 0.5% | |
| | |
CBRE Group, Inc., Class A* | | | 10,332 | | | | 716,421 | |
|
Residential REITs – 0.7% | |
| | |
AvalonBay Communities, Inc., REIT | | | 4,788 | | | | 793,563 | |
| | |
Equity Residential, REIT | | | 3,150 | | | | 174,289 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 277 | |
FlexShares® US Quality Large Cap Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Residential REITs – (continued) | |
| | |
Mid-America Apartment Communities, Inc., REIT(a) | | | 252 | | | $ | 29,774 | |
| | | | | | | 997,626 | |
|
Retail REITs – 0.1% | |
| | |
Regency Centers Corp., REIT | | | 504 | | | | 30,371 | |
| | |
Simon Property Group, Inc., REIT | | | 882 | | | | 96,923 | |
| | | | | | | 127,294 | |
|
Semiconductors & Semiconductor Equipment – 7.3% | |
| | |
Analog Devices, Inc. | | | 4,914 | | | | 773,120 | |
| | |
Applied Materials, Inc. | | | 8,190 | | | | 1,083,947 | |
| | |
Broadcom, Inc. | | | 2,421 | | | | 2,036,957 | |
| | |
KLA Corp. | | | 2,142 | | | | 1,006,097 | |
| | |
Lam Research Corp. | | | 2,142 | | | | 1,259,967 | |
| | |
Microchip Technology, Inc. | | | 11,592 | | | | 826,394 | |
| | |
NVIDIA Corp. | | | 7,938 | | | | 3,237,116 | |
| | |
QUALCOMM, Inc. | | | 4,158 | | | | 453,180 | |
| | | | | | | 10,676,778 | |
|
Software – 10.7% | |
| | |
Adobe, Inc.* | | | 3,402 | | | | 1,810,068 | |
| | |
ANSYS, Inc.* | | | 630 | | | | 175,304 | |
| | |
Autodesk, Inc.* | | | 126 | | | | 24,901 | |
| | |
Bentley Systems, Inc., Class B(a) | | | 756 | | | | 36,772 | |
| | |
Cadence Design Systems, Inc.* | | | 378 | | | | 90,663 | |
| | |
Check Point Software Technologies Ltd.* | | | 5,922 | | | | 795,028 | |
| | |
Fair Isaac Corp.* | | | 756 | | | | 639,478 | |
| | |
Fortinet, Inc.* | | | 10,962 | | | | 626,698 | |
| | |
Intuit, Inc. | | | 3,276 | | | | 1,621,456 | |
| | |
Manhattan Associates, Inc.* | | | 882 | | | | 171,972 | |
| | |
Microsoft Corp. | | | 23,562 | | | | 7,966,548 | |
| | |
Oracle Corp. | | | 15,624 | | | | 1,615,522 | |
| | |
Roper Technologies, Inc. | | | 126 | | | | 61,560 | |
| | |
Salesforce, Inc.* | | | 126 | | | | 25,305 | |
| | |
Zoom Video Communications, Inc., Class A* (a) | | | 1,386 | | | | 83,132 | |
| | | | | | | 15,744,407 | |
|
Specialized REITs – 1.1% | |
| | |
Iron Mountain, Inc., REIT(a) | | | 1,260 | | | | 74,428 | |
| | |
Public Storage, REIT | | | 3,024 | | | | 721,859 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Specialized REITs – (continued) | |
| | |
Weyerhaeuser Co., REIT | | | 26,460 | | | $ | 759,138 | |
| | | | | | | 1,555,425 | |
|
Specialty Retail – 2.4% | |
| | |
AutoZone, Inc.* | | | 378 | | | | 936,355 | |
| | |
Best Buy Co., Inc. | | | 4,536 | | | | 303,096 | |
| | |
Home Depot, Inc. (The) | | | 3,402 | | | | 968,516 | |
| | |
Lowe’s Cos., Inc. | | | 4,662 | | | | 888,437 | |
| | |
O’Reilly Automotive, Inc.* | | | 378 | | | | 351,706 | |
| | |
Ulta Beauty, Inc.* | | | 378 | | | | 144,135 | |
| | | | | | | 3,592,245 | |
|
Technology Hardware, Storage & Peripherals – 8.6% | |
| | |
Apple, Inc. | | | 72,576 | | | | 12,393,803 | |
| | |
NetApp, Inc. | | | 1,260 | | | | 91,703 | |
| | |
Super Micro Computer, Inc.* | | | 378 | | | | 90,520 | |
| | | | | | | 12,576,026 | |
|
Tobacco – 0.7% | |
| | |
Altria Group, Inc. | | | 5,040 | | | | 202,457 | |
| | |
Philip Morris International, Inc. | | | 9,702 | | | | 865,030 | |
| | | | | | | 1,067,487 | |
|
Trading Companies & Distributors – 0.6% | |
| | |
WW Grainger, Inc. | | | 1,194 | | | | 871,417 | |
|
Water Utilities – 0.0%(b) | |
| | |
Veralto Corp.* | | | 166 | | | | 11,454 | |
Total Common Stocks (Cost $138,888,823) | | | | 145,727,979 | |
| | | | | | | | |
Total Investments – 99.3% (Cost $138,888,823) | | | | 145,727,979 | |
| |
Other assets less liabilities – 0.7% | | | | 1,077,913 | |
NET ASSETS – 100.0% | | | $ | 146,805,892 | |
* | Non-income producing security. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $4,023,270, collateralized in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053; a total value of $4,059,459. |
(b) | Represents less than 0.05% of net assets. |
See Accompanying Notes to the Financial Statements.
| | | | |
278 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® US Quality Large Cap Index Fund (cont.)
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 14,828,794 | |
Aggregate gross unrealized depreciation | | | (8,030,809 | ) |
Net unrealized appreciation | | $ | 6,797,985 | |
Federal income tax cost | | $ | 138,864,423 | |
Futures Contracts
FlexShares® US Quality Large Cap Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and UnrealizedDepreciation* | |
Long Contracts | | | | | |
S&P 500 E-Mini Index | | | 2 | | | | 12/15/2023 | | | | USD | | | $ | 421,225 | | | $ | (29,611 | ) |
S&P 500 Micro E-Mini Index | | | 29 | | | | 12/15/2023 | | | | USD | | | | 610,776 | | | | (35,960 | ) |
| | | | | | | | | | | | | | | | | | $ | (65,571 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.3 | % |
Others(1) | | | 0.7 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 279 | |
Schedule of Investments
FlexShares® STOXX® US ESG Select Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.8% | |
|
Air Freight & Logistics – 0.3% | |
| | |
Expeditors International of Washington, Inc. | | | 715 | | | $ | 78,114 | |
| | |
FedEx Corp. | | | 1,625 | | | | 390,162 | |
| | | | | | | 468,276 | |
|
Automobile Components – 0.1% | |
| | |
Aptiv plc* | | | 1,495 | | | | 130,364 | |
| | |
BorgWarner, Inc.(a) | | | 1,690 | | | | 62,361 | |
| | | | | | | 192,725 | |
|
Automobiles – 3.8% | |
| | |
Ford Motor Co. | | | 13,390 | | | | 130,552 | |
| | |
General Motors Co. | | | 14,235 | | | | 401,427 | |
| | |
Rivian Automotive, Inc., Class A* (a) | | | 5,980 | | | | 96,996 | |
| | |
Tesla, Inc.* | | | 28,795 | | | | 5,783,188 | |
| | | | | | | 6,412,163 | |
|
Banks – 4.4% | |
| | |
Bank of America Corp. | | | 72,150 | | | | 1,900,431 | |
| | |
Citigroup, Inc. | | | 19,955 | | | | 788,023 | |
| | |
Huntington Bancshares, Inc. | | | 11,765 | | | | 113,532 | |
| | |
JPMorgan Chase & Co. | | | 30,290 | | | | 4,212,128 | |
| | |
KeyCorp(a) | | | 5,785 | | | | 59,123 | |
| | |
Regions Financial Corp. | | | 6,110 | | | | 88,778 | |
| | |
US Bancorp | | | 5,590 | | | | 178,209 | |
| | | | | | | 7,340,224 | |
|
Beverages – 2.4% | |
| | |
Brown-Forman Corp., Class B | | | 1,170 | | | | 65,707 | |
| | |
Coca-Cola Co. (The) | | | 40,885 | | | | 2,309,594 | |
| | |
Coca-Cola Europacific Partners plc | | | 2,210 | | | | 129,307 | |
| | |
Keurig Dr Pepper, Inc. | | | 10,335 | | | | 313,461 | |
| | |
PepsiCo, Inc. | | | 7,150 | | | | 1,167,452 | |
| | | | | | | 3,985,521 | |
|
Biotechnology – 1.2% | |
| | |
Amgen, Inc. | | | 1,885 | | | | 481,995 | |
| | |
Gilead Sciences, Inc. | | | 8,645 | | | | 678,978 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 2,210 | | | | 800,263 | |
| | | | | | | 1,961,236 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Broadline Retail – 5.2% | |
| | |
Amazon.com, Inc.* | | | 63,700 | | | $ | 8,477,833 | |
| | |
eBay, Inc. | | | 4,550 | | | | 178,497 | |
| | | | | | | 8,656,330 | |
|
Building Products – 0.3% | |
| | |
Lennox International, Inc. | | | 325 | | | | 120,426 | |
| | |
Owens Corning(a) | | | 455 | | | | 51,583 | |
| | |
Trane Technologies plc | | | 2,015 | | | | 383,475 | |
| | | | | | | 555,484 | |
|
Capital Markets – 2.9% | |
| | |
Bank of New York Mellon Corp. (The) | | | 4,225 | | | | 179,563 | |
| | |
BlackRock, Inc. | | | 1,495 | | | | 915,359 | |
| | |
FactSet Research Systems, Inc. | | | 390 | | | | 168,437 | |
| | |
Goldman Sachs Group, Inc. (The) | | | 3,445 | | | | 1,045,936 | |
| | |
Moody’s Corp. | | | 845 | | | | 260,260 | |
| | |
Morgan Stanley | | | 8,970 | | | | 635,255 | |
| | |
MSCI, Inc., Class A | | | 585 | | | | 275,857 | |
| | |
Nasdaq, Inc. | | | 3,120 | | | | 154,752 | |
| | |
Northern Trust Corp.(b) | | | 1,170 | | | | 77,115 | |
| | |
S&P Global, Inc. | | | 2,730 | | | | 953,616 | |
| | |
State Street Corp. | | | 2,275 | | | | 147,033 | |
| | | | | | | 4,813,183 | |
|
Chemicals – 0.6% | |
| | |
Corteva, Inc. | | | 4,810 | | | | 231,553 | |
| | |
DuPont de Nemours, Inc. | | | 3,250 | | | | 236,860 | |
| | |
Ecolab, Inc. | | | 2,015 | | | | 337,996 | |
| | |
Sherwin-Williams Co. (The) | | | 845 | | | | 201,288 | |
| | | | | | | 1,007,697 | |
|
Commercial Services & Supplies – 0.3% | |
| | |
Cintas Corp. | | | 910 | | | | 461,479 | |
|
Communications Equipment – 1.1% | |
| | |
Cisco Systems, Inc. | | | 35,295 | | | | 1,839,928 | |
| | |
F5, Inc.* | | | 325 | | | | 49,267 | |
| | | | | | | 1,889,195 | |
|
Consumer Finance – 0.1% | |
| | |
Capital One Financial Corp. | | | 1,235 | | | | 125,093 | |
See Accompanying Notes to the Financial Statements.
| | | | |
280 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Staples Distribution & Retail – 2.6% | |
| | |
Costco Wholesale Corp. | | | 1,560 | | | $ | 861,807 | |
| | |
Dollar Tree, Inc.* | | | 1,170 | | | | 129,975 | |
| | |
Kroger Co. (The) | | | 6,760 | | | | 306,701 | |
| | |
Target Corp. | | | 3,965 | | | | 439,282 | |
| | |
Walgreens Boots Alliance, Inc. | | | 7,540 | | | | 158,943 | |
| | |
Walmart, Inc. | | | 15,080 | | | | 2,464,223 | |
| | | | | | | 4,360,931 | |
|
Containers & Packaging – 0.2% | |
| | |
Amcor plc | | | 14,105 | | | | 125,393 | |
| | |
Ball Corp.(a) | | | 2,860 | | | | 137,709 | |
| | | | | | | 263,102 | |
|
Diversified Telecommunication Services – 0.6% | |
| | |
Verizon Communications, Inc. | | | 29,380 | | | | 1,032,119 | |
|
Electric Utilities – 0.0%(c) | |
| | |
Entergy Corp. | | | 780 | | | | 74,560 | |
|
Electrical Equipment – 0.2% | |
| | |
Emerson Electric Co. | | | 1,950 | | | | 173,491 | |
| | |
Rockwell Automation, Inc. | | | 390 | | | | 102,496 | |
| | | | | | | 275,987 | |
|
Electronic Equipment, Instruments & Components – 0.4% | |
| | |
CDW Corp. | | | 1,170 | | | | 234,468 | |
| | |
Corning, Inc. | | | 3,965 | | | | 106,103 | |
| | |
Flex Ltd.* | | | 1,235 | | | | 31,765 | |
| | |
Jabil, Inc. | | | 650 | | | | 79,820 | |
| | |
Keysight Technologies, Inc.* | | | 585 | | | | 71,399 | |
| | |
Trimble, Inc.* | | | 1,170 | | | | 55,142 | |
| | |
Zebra Technologies Corp., Class A* | | | 195 | | | | 40,839 | |
| | | | | | | 619,536 | |
|
Energy Equipment & Services – 0.6% | |
| | |
Baker Hughes Co., Class A | | | 5,395 | | | | 185,696 | |
| | |
Schlumberger NV(a) | | | 14,885 | | | | 828,499 | |
| | | | | | | 1,014,195 | |
|
Entertainment – 0.8% | |
| | |
Walt Disney Co. (The)* | | | 15,860 | | | | 1,294,017 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Financial Services – 6.0% | |
| | |
Apollo Global Management, Inc.(a) | | | 4,680 | | | $ | 362,419 | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 13,650 | | | | 4,659,154 | |
| | |
Block, Inc., Class A* | | | 1,755 | | | | 70,639 | |
| | |
Fidelity National Information Services, Inc. | | | 2,925 | | | | 143,647 | |
| | |
Mastercard, Inc., Class A | | | 2,925 | | | | 1,100,824 | |
| | |
PayPal Holdings, Inc.* | | | 7,605 | | | | 393,939 | |
| | |
Visa, Inc., Class A | | | 13,910 | | | | 3,270,241 | |
| | | | | | | 10,000,863 | |
|
Food Products – 1.1% | |
| | |
Archer-Daniels-Midland Co. | | | 1,950 | | | | 139,561 | |
| | |
Conagra Brands, Inc. | | | 3,055 | | | | 83,585 | |
| | |
Darling Ingredients, Inc.* | | | 1,235 | | | | 54,698 | |
| | |
General Mills, Inc. | | | 6,045 | | | | 394,376 | |
| | |
Hershey Co. (The) | | | 1,560 | | | | 292,266 | |
| | |
Hormel Foods Corp. | | | 1,755 | | | | 57,125 | |
| | |
J M Smucker Co. (The) | | | 715 | | | | 81,396 | |
| | |
Kellogg Co. | | | 3,445 | | | | 173,869 | |
| | |
McCormick & Co., Inc. (Non-Voting) | | | 2,080 | | | | 132,912 | |
| | |
Mondelez International, Inc., Class A | | | 4,810 | | | | 318,470 | |
| | |
Tyson Foods, Inc., Class A | | | 1,105 | | | | 51,217 | |
| | | | | | | 1,779,475 | |
|
Ground Transportation – 0.7% | |
| | |
Uber Technologies, Inc.* | | | 10,660 | | | | 461,365 | |
| | |
Union Pacific Corp. | | | 3,185 | | | | 661,238 | |
| | | | | | | 1,122,603 | |
|
Health Care Equipment & Supplies – 1.9% | |
| | |
Baxter International, Inc. | | | 1,950 | | | | 63,238 | |
| | |
Becton Dickinson & Co. | | | 2,015 | | | | 509,352 | |
| | |
Boston Scientific Corp.* | | | 7,475 | | | | 382,645 | |
| | |
Cooper Cos., Inc. (The) | | | 325 | | | | 101,319 | |
| | |
Edwards Lifesciences Corp.* | | | 5,330 | | | | 339,628 | |
| | |
Hologic, Inc.* | | | 2,015 | | | | 133,333 | |
| | |
IDEXX Laboratories, Inc.* | | | 455 | | | | 181,759 | |
| | |
Medtronic plc | | | 6,955 | | | | 490,745 | |
| | |
Penumbra, Inc.* | | | 390 | | | | 74,548 | |
| | |
Stryker Corp. | | | 2,925 | | | | 790,393 | |
| | |
Zimmer Biomet Holdings, Inc. | | | 1,105 | | | | 115,373 | |
| | | | | | | 3,182,333 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 281 | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Health Care Providers & Services – 3.5% | |
| | |
Cardinal Health, Inc. | | | 1,820 | | | $ | 165,620 | |
| | |
Cencora, Inc. | | | 910 | | | | 168,486 | |
| | |
Centene Corp.* | | | 1,755 | | | | 121,060 | |
| | |
Cigna Group (The) | | | 2,080 | | | | 643,136 | |
| | |
CVS Health Corp. | | | 13,455 | | | | 928,530 | |
| | |
Elevance Health, Inc. | | | 2,080 | | | | 936,187 | |
| | |
Humana, Inc. | | | 455 | | | | 238,279 | |
| | |
Quest Diagnostics, Inc. | | | 325 | | | | 42,282 | |
| | |
UnitedHealth Group, Inc. | | | 4,810 | | | | 2,576,044 | |
| | | | | | | 5,819,624 | |
|
Health Care REITs – 0.4% | |
| | |
Healthpeak Properties, Inc., REIT | | | 5,330 | | | | 82,882 | |
| | |
Ventas, Inc., REIT | | | 3,640 | | | | 154,554 | |
| | |
Welltower, Inc., REIT(a) | | | 5,395 | | | | 451,076 | |
| | | | | | | 688,512 | |
|
Hotels, Restaurants & Leisure – 2.1% | |
| | |
Booking Holdings, Inc.* | | | 260 | | | | 725,286 | |
| | |
Caesars Entertainment, Inc.* | | | 1,235 | | | | 49,264 | |
| | |
Carnival Corp.* (a) | | | 4,030 | | | | 46,184 | |
| | |
Chipotle Mexican Grill, Inc., Class A* | | | 130 | | | | 252,486 | |
| | |
Darden Restaurants, Inc. | | | 845 | | | | 122,973 | |
| | |
Domino’s Pizza, Inc. | | | 260 | | | | 88,137 | |
| | |
Hilton Worldwide Holdings, Inc. | | | 2,275 | | | | 344,731 | |
| | |
Las Vegas Sands Corp. | | | 1,560 | | | | 74,038 | |
| | |
Marriott International, Inc., Class A | | | 1,365 | | | | 257,384 | |
| | |
McDonald’s Corp. | | | 3,770 | | | | 988,381 | |
| | |
MGM Resorts International | | | 2,600 | | | | 90,792 | |
| | |
Yum China Holdings, Inc. | | | 2,275 | | | | 119,574 | |
| | |
Yum! Brands, Inc. | | | 2,405 | | | | 290,668 | |
| | | | | | | 3,449,898 | |
|
Household Products – 2.3% | |
| | |
Church & Dwight Co., Inc.(a) | | | 1,365 | | | | 124,133 | |
| | |
Clorox Co. (The) | | | 1,300 | | | | 153,010 | |
| | |
Colgate-Palmolive Co. | | | 7,085 | | | | 532,225 | |
| | |
Procter & Gamble Co. (The) | | | 20,475 | | | | 3,071,865 | |
| | | | | | | 3,881,233 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Independent Power and Renewable Electricity Producers – 0.0%(c) | |
| | |
AES Corp. (The) | | | 4,160 | | | $ | 61,984 | |
|
Industrial REITs – 0.2% | |
| | |
Prologis, Inc., REIT | | | 3,185 | | | | 320,889 | |
|
Insurance – 2.1% | |
| | |
Aflac, Inc. | | | 4,745 | | | | 370,632 | |
| | |
Allstate Corp. (The)(a) | | | 1,365 | | | | 174,897 | |
| | |
American International Group, Inc. | | | 2,535 | | | | 155,421 | |
| | |
Aon plc, Class A | | | 1,040 | | | | 321,776 | |
| | |
Arch Capital Group Ltd.* | | | 1,365 | | | | 118,318 | |
| | |
Arthur J Gallagher & Co. | | | 1,495 | | | | 352,058 | |
| | |
Chubb Ltd. | | | 1,430 | | | | 306,907 | |
| | |
Everest Group Ltd. | | | 325 | | | | 128,576 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | 2,535 | | | | 186,196 | |
| | |
Marsh & McLennan Cos., Inc. | | | 3,445 | | | | 653,344 | |
| | |
Progressive Corp. (The) | | | 3,055 | | | | 482,965 | |
| | |
Willis Towers Watson plc | | | 910 | | | | 214,660 | |
| | | | | | | 3,465,750 | |
|
Interactive Media & Services – 5.8% | |
| | |
Alphabet, Inc., Class C* | | | 20,150 | | | | 2,524,795 | |
| | |
Meta Platforms, Inc., Class A* | | | 23,140 | | | | 6,971,388 | |
| | |
Snap, Inc., Class A* (a) | | | 11,830 | | | | 118,418 | |
| | | | | | | 9,614,601 | |
|
IT Services – 2.5% | |
| | |
Accenture plc, Class A | | | 6,890 | | | | 2,046,950 | |
| | |
Akamai Technologies, Inc.* | | | 1,365 | | | | 141,045 | |
| | |
Amdocs Ltd. | | | 1,170 | | | | 93,787 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 4,485 | | | | 289,148 | |
| | |
Gartner, Inc.* (a) | | | 650 | | | | 215,826 | |
| | |
International Business Machines Corp. | | | 9,490 | | | | 1,372,634 | |
| | | | | | | 4,159,390 | |
|
Life Sciences Tools & Services – 0.9% | |
| | |
Agilent Technologies, Inc. | | | 1,495 | | | | 154,538 | |
| | |
Avantor, Inc.* (a) | | | 2,730 | | | | 47,584 | |
| | |
Danaher Corp. | | | 3,640 | | | | 698,953 | |
| | |
Illumina, Inc.* | | | 1,105 | | | | 120,909 | |
See Accompanying Notes to the Financial Statements.
| | | | |
282 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Life Sciences Tools & Services – (continued) | |
| | |
IQVIA Holdings, Inc.* | | | 1,625 | | | $ | 293,849 | |
| | |
Mettler-Toledo International, Inc.* | | | 65 | | | | 64,038 | |
| | |
Revvity, Inc.(a) | | | 455 | | | | 37,697 | |
| | |
West Pharmaceutical Services, Inc. | | | 390 | | | | 124,133 | |
| | | | | | | 1,541,701 | |
|
Machinery – 1.5% | |
| | |
Caterpillar, Inc. | | | 2,665 | | | | 602,423 | |
| | |
Cummins, Inc. | | | 975 | | | | 210,893 | |
| | |
Deere & Co. | | | 1,040 | | | | 379,974 | |
| | |
Dover Corp. | | | 780 | | | | 101,361 | |
| | |
Fortive Corp. | | | 2,990 | | | | 195,187 | |
| | |
IDEX Corp. | | | 390 | | | | 74,650 | |
| | |
Illinois Tool Works, Inc. | | | 1,040 | | | | 233,085 | |
| | |
Ingersoll Rand, Inc. | | | 1,495 | | | | 90,717 | |
| | |
Nordson Corp. | | | 390 | | | | 82,910 | |
| | |
Otis Worldwide Corp. | | | 3,510 | | | | 271,007 | |
| | |
Stanley Black & Decker, Inc. | | | 1,365 | | | | 116,093 | |
| | |
Toro Co. (The) | | | 780 | | | | 63,055 | |
| | |
Xylem, Inc. | | | 1,170 | | | | 109,442 | |
| | | | | | | 2,530,797 | |
|
Media – 0.7% | |
| | |
Comcast Corp., Class A | | | 21,385 | | | | 882,987 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | 3,055 | | | | 86,762 | |
| | |
Omnicom Group, Inc. | | | 1,820 | | | | 136,336 | |
| | | | | | | 1,106,085 | |
|
Metals & Mining – 0.5% | |
| | |
Freeport-McMoRan, Inc. | | | 9,880 | | | | 333,746 | |
| | |
Newmont Corp.(a) | | | 10,010 | | | | 375,075 | |
| | |
Nucor Corp. | | | 1,300 | | | | 192,127 | |
| | | | | | | 900,948 | |
|
Multi-Utilities – 0.2% | |
| | |
CMS Energy Corp.(a) | | | 1,105 | | | | 60,046 | |
| | |
Consolidated Edison, Inc. | | | 1,235 | | | | 108,421 | |
| | |
Public Service Enterprise Group, Inc. | | | 1,625 | | | | 100,181 | |
| | | | | | | 268,648 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Office REITs – 0.0%(c) | |
| | |
Alexandria Real Estate Equities, Inc., REIT | | | 585 | | | $ | 54,481 | |
|
Oil, Gas & Consumable Fuels – 4.7% | |
| | |
APA Corp. | | | 975 | | | | 38,727 | |
| | |
Chevron Corp. | | | 18,135 | | | | 2,642,814 | |
| | |
Coterra Energy, Inc. | | | 5,525 | | | | 151,937 | |
| | |
Exxon Mobil Corp. | | | 41,730 | | | | 4,417,120 | |
| | |
Marathon Oil Corp. | | | 3,900 | | | | 106,509 | |
| | |
Phillips 66(a) | | | 4,680 | | | | 533,848 | |
| | | | | | | 7,890,955 | |
|
Passenger Airlines – 0.0%(c) | |
| | |
American Airlines Group, Inc.* (a) | | | 3,965 | | | | 44,210 | |
| | |
United Airlines Holdings, Inc.* | | | 975 | | | | 34,135 | |
| | | | | | | 78,345 | |
|
Personal Care Products – 0.1% | |
| | |
Estee Lauder Cos., Inc. (The), Class A | | | 2,015 | | | | 259,673 | |
|
Pharmaceuticals – 7.6% | |
| | |
Bristol-Myers Squibb Co. | | | 21,710 | | | | 1,118,716 | |
| | |
Eli Lilly & Co. | | | 5,915 | | | | 3,276,496 | |
| | |
Johnson & Johnson | | | 25,090 | | | | 3,721,851 | |
| | |
Merck & Co., Inc. | | | 26,390 | | | | 2,710,253 | |
| | |
Pfizer, Inc. | | | 39,260 | | | | 1,199,785 | |
| | |
Royalty Pharma plc, Class A | | | 3,900 | | | | 104,793 | |
| | |
Zoetis, Inc., Class A | | | 4,030 | | | | 632,710 | |
| | | | | | | 12,764,604 | |
|
Professional Services – 0.7% | |
| | |
Automatic Data Processing, Inc. | | | 3,640 | | | | 794,321 | |
| | |
Broadridge Financial Solutions, Inc. | | | 650 | | | | 110,916 | |
| | |
Verisk Analytics, Inc., Class A | | | 1,495 | | | | 339,903 | |
| | | | | | | 1,245,140 | |
|
Real Estate Management & Development – 0.1% | |
| | |
CBRE Group, Inc., Class A* | | | 3,120 | | | | 216,341 | |
|
Residential REITs – 0.2% | |
| | |
Camden Property Trust, REIT(a) | | | 455 | | | | 38,620 | |
| | |
Equity Residential, REIT | | | 1,690 | | | | 93,508 | |
| | |
Essex Property Trust, Inc., REIT(a) | | | 455 | | | | 97,334 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 283 | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Residential REITs – (continued) | |
| | |
Mid-America Apartment Communities, Inc., REIT | | | 455 | | | $ | 53,758 | |
| | | | | | | 283,220 | |
|
Retail REITs – 0.1% | |
| | |
Simon Property Group, Inc., REIT | | | 1,170 | | | | 128,571 | |
|
Semiconductors & Semiconductor Equipment – 5.9% | |
| | |
Advanced Micro Devices, Inc.* | | | 5,590 | | | | 550,615 | |
| | |
Applied Materials, Inc. | | | 7,280 | | | | 963,508 | |
| | |
First Solar, Inc.* | | | 520 | | | | 74,074 | |
| | |
Intel Corp. | | | 36,335 | | | | 1,326,227 | |
| | |
KLA Corp. | | | 715 | | | | 335,835 | |
| | |
Lam Research Corp. | | | 910 | | | | 535,280 | |
| | |
Microchip Technology, Inc.(a) | | | 1,950 | | | | 139,015 | |
| | |
Micron Technology, Inc. | | | 11,440 | | | | 764,993 | |
| | |
NVIDIA Corp. | | | 8,580 | | | | 3,498,924 | |
| | |
Qorvo, Inc.* | | | 390 | | | | 34,094 | |
| | |
QUALCOMM, Inc. | | | 5,850 | | | | 637,592 | |
| | |
Skyworks Solutions, Inc.(a) | | | 585 | | | | 50,743 | |
| | |
Teradyne, Inc. | | | 585 | | | | 48,713 | |
| | |
Texas Instruments, Inc. | | | 6,370 | | | | 904,604 | |
| | | | | | | 9,864,217 | |
|
Software – 9.7% | |
| | |
Adobe, Inc.* | | | 3,965 | | | | 2,109,618 | |
| | |
Autodesk, Inc.* | | | 2,210 | | | | 436,762 | |
| | |
Crowdstrike Holdings, Inc., Class A* (a) | | | 1,560 | | | | 275,761 | |
| | |
DocuSign, Inc., Class A* | | | 1,235 | | | | 48,017 | |
| | |
Fortinet, Inc.* | | | 2,340 | | | | 133,778 | |
| | |
Gen Digital, Inc. | | | 5,720 | | | | 95,295 | |
| | |
HubSpot, Inc.* | | | 455 | | | | 192,815 | |
| | |
Intuit, Inc. | | | 1,950 | | | | 965,152 | |
| | |
Microsoft Corp. | | | 26,650 | | | | 9,010,632 | |
| | |
Oracle Corp. | | | 5,395 | | | | 557,843 | |
| | |
Palo Alto Networks, Inc.* | | | 2,145 | | | | 521,278 | |
| | |
Salesforce, Inc.* | | | 5,070 | | | | 1,018,208 | |
| | |
Splunk, Inc.* | | | 780 | | | | 114,785 | |
| | |
Synopsys, Inc.* | | | 1,040 | | | | 488,218 | |
| | |
Workday, Inc., Class A* | | | 715 | | | | 151,373 | |
| | | | | | | 16,119,535 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Specialized REITs – 0.6% | |
| | |
American Tower Corp., REIT | | | 2,405 | | | $ | 428,547 | |
| | |
Digital Realty Trust, Inc., REIT(a) | | | 1,040 | | | | 129,334 | |
| | |
Iron Mountain, Inc., REIT | | | 2,535 | | | | 149,743 | |
| | |
Weyerhaeuser Co., REIT | | | 7,865 | | | | 225,647 | |
| | | | | | | 933,271 | |
|
Specialty Retail – 1.7% | |
| | |
AutoZone, Inc.* | | | 65 | | | | 161,013 | |
| | |
Best Buy Co., Inc. | | | 2,080 | | | | 138,986 | |
| | |
Burlington Stores, Inc.* | | | 390 | | | | 47,202 | |
| | |
Lowe’s Cos., Inc. | | | 5,070 | | | | 966,190 | |
| | |
Ross Stores, Inc. | | | 2,990 | | | | 346,750 | |
| | |
TJX Cos., Inc. (The) | | | 10,010 | | | | 881,581 | |
| | |
Tractor Supply Co. | | | 910 | | | | 175,230 | |
| | |
Ulta Beauty, Inc.* | | | 195 | | | | 74,355 | |
| | |
Williams-Sonoma, Inc.(a) | | | 650 | | | | 97,656 | |
| | | | | | | 2,888,963 | |
|
Technology Hardware, Storage & Peripherals – 5.5% | |
| | |
Apple, Inc. | | | 49,465 | | | | 8,447,138 | |
| | |
Hewlett Packard Enterprise Co. | | | 10,725 | | | | 164,950 | |
| | |
HP, Inc. | | | 9,295 | | | | 244,737 | |
| | |
NetApp, Inc. | | | 1,560 | | | | 113,537 | |
| | |
Super Micro Computer, Inc.* | | | 325 | | | | 77,828 | |
| | |
Western Digital Corp.* | | | 3,185 | | | | 127,878 | |
| | | | | | | 9,176,068 | |
|
Textiles, Apparel & Luxury Goods – 0.9% | |
| | |
Deckers Outdoor Corp.* | | | 195 | | | | 116,427 | |
| | |
Lululemon Athletica, Inc.* (a) | | | 1,300 | | | | 511,524 | |
| | |
NIKE, Inc., Class B | | | 8,580 | | | | 881,766 | |
| | | | | | | 1,509,717 | |
|
Trading Companies & Distributors – 0.4% | |
| | |
Ferguson plc | | | 2,145 | | | | 322,179 | |
| | |
United Rentals, Inc. | | | 260 | | | | 105,630 | |
| | |
WW Grainger, Inc. | | | 325 | | | | 237,195 | |
| | | | | | | 665,004 | |
|
Water Utilities – 0.1% | |
| | |
American Water Works Co., Inc. | | | 1,300 | | | | 152,945 | |
Total Common Stocks (Cost $153,457,687) | | | | 164,929,437 | |
See Accompanying Notes to the Financial Statements.
| | | | |
284 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 0.1%(d) | |
|
REPURCHASE AGREEMENTS – 0.1% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $97,173, collateralized by various U.S. Treasury Securities, ranging from 1.50% –3.88%, maturing 2/15/2025 –1/31/2027; total market value $98,264 (Cost $97,159) | | | 97,159 | | | $ | 97,159 | |
Total Investments – 98.9% (Cost $153,554,846) | | | | 165,026,596 | |
| |
Other assets less liabilities – 1.1% | | | | 1,898,152 | |
NET ASSETS – 100.0% | | | $ | 166,924,748 | |
* | Non-income producing security. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $4,105,867, collateralized in the form of cash with a value of $97,159 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $4,083,890 of collateral in the form of U.S. Government Treasury |
| Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $5,212 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 4.25%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $4,186,261. |
(b) | Investment in affiliated company. Northern Trust Investments, Inc., the Investment Adviser of the Fund, is a subsidiary of Northern Trust Corporation. |
(c) | Represents less than 0.05% of net assets. |
(d) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $97,159. |
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 22,280,225 | |
Aggregate gross unrealized depreciation | | | (10,820,223 | ) |
Net unrealized appreciation | | $ | 11,460,002 | |
Federal income tax cost | | $ | 153,450,476 | |
Investment in a company which was affiliated for the period ended October 31, 2023, was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Security | | Value October 31, 2022 | | | Purchases at Cost | | | Sales Proceeds | | | Shares October 31, 2023 | | | Value October 31, 2023 | | | Change in Unrealized Appreciation (Depreciation) | | | Dividend Income | | | Realized Loss | |
Northern Trust Corp. | | $ | — | | | $ | 183,321 | | | $ | 81,522 | | | | 1,170 | | | $ | 77,115 | | | $ | (17,217 | ) | | $ | 2,449 | | | $ | (7,467 | ) |
Futures Contracts
FlexShares® STOXX® US ESG Select Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | |
S&P 500 E-Mini Index | | | 9 | | | | 12/15/2023 | | | | USD | | | $ | 1,895,513 | | | $ | (116,118 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 285 | |
FlexShares® STOXX® US ESG Select Index Fund (cont.)
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.8 | % |
Securities Lending Reinvestments | | | 0.1 | |
Others(1) | | | 1.1 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
286 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® STOXX® Global ESG Select Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.8% | |
|
Air Freight & Logistics – 0.2% | |
| | |
Deutsche Post AG | | | 3,220 | | | $ | 125,114 | |
| | |
DSV A/S | | | 1,150 | | | | 171,327 | |
| | |
International Distributions Services plc* | | | 8,441 | | | | 25,873 | |
| | | | | | | 322,314 | |
|
Automobile Components – 0.4% | |
| | |
Aisin Corp. | | | 1,200 | | | | 41,219 | |
| | |
BorgWarner, Inc.(a) | | | 782 | | | | 28,856 | |
| | |
Bridgestone Corp. | | | 4,600 | | | | 172,130 | |
| | |
Cie Generale des Etablissements Michelin SCA | | | 4,462 | | | | 132,152 | |
| | |
Continental AG | | | 552 | | | | 35,848 | |
| | |
Denso Corp. | | | 11,600 | | | | 168,472 | |
| | |
Forvia SE* | | | 1,127 | | | | 18,869 | |
| | |
Niterra Co. Ltd. | | | 2,300 | | | | 50,876 | |
| | |
Sumitomo Electric Industries Ltd. | | | 2,300 | | | | 23,828 | |
| | |
Valeo SE | | | 414 | | | | 5,444 | |
| | | | | | | 677,694 | |
|
Automobiles – 2.0% | |
| | |
Bayerische Motoren Werke AG | | | 1,748 | | | | 161,908 | |
| | |
Ferrari NV | | | 506 | | | | 152,697 | |
| | |
General Motors Co. | | | 10,258 | | | | 289,276 | |
| | |
Honda Motor Co. Ltd. | | | 33,300 | | | | 331,252 | |
| | |
Mazda Motor Corp. | | | 2,300 | | | | 21,626 | |
| | |
Mercedes-Benz Group AG | | | 5,060 | | | | 296,463 | |
| | |
Mitsubishi Motors Corp. | | | 6,900 | | | | 21,988 | |
| | |
Nissan Motor Co. Ltd. | | | 18,400 | | | | 68,937 | |
| | |
Renault SA | | | 1,058 | | | | 36,960 | |
| | |
Rivian Automotive, Inc., Class A* (a) | | | 4,278 | | | | 69,389 | |
| | |
Stellantis NV | | | 12,236 | | | | 227,629 | |
| | |
Subaru Corp. | | | 2,300 | | | | 38,871 | |
| | |
Suzuki Motor Corp. | | | 2,300 | | | | 87,842 | |
| | |
Toyota Motor Corp. | | | 64,400 | | | | 1,101,363 | |
| | |
Volkswagen AG (Preference) | | | 874 | | | | 92,225 | |
| | |
Volvo Car AB, Class B* (a) | | | 2,116 | | | | 7,256 | |
| | |
Yamaha Motor Co. Ltd.(a) | | | 2,300 | | | | 55,235 | |
| | | | | | | 3,060,917 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – 8.6% | |
| | |
ABN AMRO Bank NV, CVA(b) | | | 2,254 | | | $ | 30,222 | |
| | |
AIB Group plc | | | 8,786 | | | | 38,020 | |
| | |
ANZ Group Holdings Ltd. | | | 19,182 | | | | 300,105 | |
| | |
Banco Bilbao Vizcaya Argentaria SA(a) | | | 31,924 | | | | 250,446 | |
| | |
Banco BPM SpA | | | 9,729 | | | | 49,598 | |
| | |
Banco Santander SA(a) | | | 87,308 | | | | 319,858 | |
| | |
Bank of America Corp. | | | 23,230 | | | | 611,878 | |
| | |
Bank of Ireland Group plc(a) | | | 7,222 | | | | 64,504 | |
| | |
Bank of Montreal | | | 4,416 | | | | 333,335 | |
| | |
Bank of Queensland Ltd.(a) | | | 3,404 | | | | 10,992 | |
| | |
Bank Polska Kasa Opieki SA | | | 1,932 | | | | 58,547 | |
| | |
Bankinter SA(a) | | | 3,726 | | | | 23,481 | |
| | |
Banque Cantonale Vaudoise (Registered) | | | 138 | | | | 15,558 | |
| | |
Barclays plc | | | 76,590 | | | | 122,307 | |
| | |
BAWAG Group AG(b) | | | 506 | | | | 22,431 | |
| | |
BNP Paribas SA | | | 7,038 | | | | 403,872 | |
| | |
Canadian Imperial Bank of Commerce | | | 5,246 | | | | 184,824 | |
| | |
Citigroup, Inc. | | | 14,904 | | | | 588,559 | |
| | |
Commerzbank AG | | | 3,289 | | | | 35,286 | |
| | |
Commonwealth Bank of Australia | | | 12,926 | | | | 790,256 | |
| | |
Danske Bank A/S | | | 3,634 | | | | 85,043 | |
| | |
DBS Group Holdings Ltd. | | | 6,900 | | | | 165,443 | |
| | |
Erste Group Bank AG | | | 966 | | | | 34,461 | |
| | |
FinecoBank Banca Fineco SpA | | | 3,496 | | | | 41,073 | |
| | |
Hang Seng Bank Ltd. | | | 4,600 | | | | 52,704 | |
| | |
HSBC Holdings plc | | | 100,464 | | | | 722,061 | |
| | |
ING Groep NV | | | 8,878 | | | | 112,871 | |
| | |
Intesa Sanpaolo SpA(a) | | | 98,900 | | | | 256,796 | |
| | |
Japan Post Bank Co. Ltd. | | | 4,600 | | | | 42,509 | |
| | |
JPMorgan Chase & Co. | | | 28,244 | | | | 3,927,611 | |
| | |
KBC Group NV | | | 1,012 | | | | 55,517 | |
| | |
Lloyds Banking Group plc | | | 374,900 | | | | 181,696 | |
| | |
Mediobanca Banca di Credito Finanziario SpA(a) | | | 2,254 | | | | 26,851 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | 85,100 | | | | 706,334 | |
| | |
NatWest Group plc | | | 27,278 | | | | 58,985 | |
| | |
Nordea Bank Abp | | | 22,862 | | | | 240,177 | |
| | |
Oversea-Chinese Banking Corp. Ltd. | | | 16,100 | | | | 149,008 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 287 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Banks – (continued) | |
| | |
Royal Bank of Canada | | | 6,440 | | | $ | 513,808 | |
| | |
Santander Bank Polska SA* | | | 46 | | | | 4,982 | |
| | |
Skandinaviska Enskilda Banken AB, Class A | | | 10,580 | | | | 117,707 | |
| | |
Societe Generale SA | | | 4,140 | | | | 92,530 | |
| | |
Standard Chartered plc | | | 12,788 | | | | 97,761 | |
| | |
Svenska Handelsbanken AB, Class A | | | 10,534 | | | | 89,570 | |
| | |
Swedbank AB, Class A | | | 5,106 | | | | 83,518 | |
| | |
Toronto-Dominion Bank (The) | | | 9,200 | | | | 513,331 | |
| | |
UniCredit SpA | | | 7,958 | | | | 198,724 | |
| | |
Virgin Money UK plc | | | 6,946 | | | | 12,554 | |
| | |
Westpac Banking Corp. | | | 21,896 | | | | 285,587 | |
| | | | | | | 13,123,291 | |
|
Beverages – 1.7% | |
| | |
Anheuser-Busch InBev SA/NV | | | 3,450 | | | | 195,570 | |
| | |
Asahi Group Holdings Ltd. | | | 2,300 | | | | 82,557 | |
| | |
Britvic plc | | | 2,231 | | | | 22,686 | |
| | |
Budweiser Brewing Co. APAC Ltd.(b) | | | 9,200 | | | | 17,496 | |
| | |
Carlsberg A/S, Class B | | | 552 | | | | 65,664 | |
| | |
Coca-Cola Co. (The) | | | 18,676 | | | | 1,055,007 | |
| | |
Coca-Cola Europacific Partners plc(a) | | | 1,150 | | | | 67,286 | |
| | |
Coca-Cola HBC AG | | | 1,150 | | | | 29,751 | |
| | |
Davide Campari-Milano NV(a) | | | 3,036 | | | | 33,470 | |
| | |
Diageo plc | | | 10,074 | | | | 379,809 | |
| | |
Heineken Holding NV | | | 460 | | | | 34,911 | |
| | |
Heineken NV | | | 1,380 | | | | 123,607 | |
| | |
Keurig Dr Pepper, Inc. | | | 5,014 | | | | 152,075 | |
| | |
Kirin Holdings Co. Ltd. | | | 4,600 | | | | 64,378 | |
| | |
Pernod Ricard SA | | | 1,196 | | | | 211,749 | |
| | |
Remy Cointreau SA | | �� | 230 | | | | 26,049 | |
| | |
Royal Unibrew A/S | | | 46 | | | | 3,321 | |
| | |
Treasury Wine Estates Ltd. | | | 5,796 | | | | 44,404 | |
| | | | | | | 2,609,790 | |
|
Biotechnology – 0.9% | |
| | |
CSL Ltd. | | | 2,438 | | | | 358,660 | |
| | |
Gilead Sciences, Inc.(a) | | | 6,072 | | | | 476,895 | |
| | |
Grifols SA* | | | 782 | | | | 8,749 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Biotechnology – (continued) | |
| | |
Swedish Orphan Biovitrum AB* | | | 603 | | | $ | 12,381 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 1,334 | | | | 483,055 | |
| | | | | | | 1,339,740 | |
|
Broadline Retail – 5.5% | |
| | |
Allegro.eu SA* (b) | | | 1,012 | | | | 7,240 | |
| | |
Amazon.com, Inc.* | | | 57,546 | | | | 7,658,797 | |
| | |
eBay, Inc. | | | 2,116 | | | | 83,011 | |
| | |
Isetan Mitsukoshi Holdings Ltd. | | | 4,600 | | | | 51,454 | |
| | |
J Front Retailing Co. Ltd.(a) | | | 2,300 | | | | 21,725 | |
| | |
Next plc | | | 690 | | | | 57,638 | |
| | |
Prosus NV* | | | 6,716 | | | | 187,622 | |
| | |
Rakuten Group, Inc. | | | 9,200 | | | | 33,824 | |
| | |
Wesfarmers Ltd. | | | 8,234 | | | | 263,379 | |
| | | | | | | 8,364,690 | |
|
Building Products – 0.4% | |
| | |
Assa Abloy AB, Class B | | | 6,072 | | | | 129,074 | |
| | |
Belimo Holding AG (Registered) | | | 46 | | | | 19,258 | |
| | |
Cie de Saint-Gobain SA | | | 3,036 | | | | 164,945 | |
| | |
Fletcher Building Ltd.(a) | | | 2,898 | | | | 7,282 | |
| | |
Lennox International, Inc. | | | 138 | | | | 51,135 | |
| | |
Lixil Corp. | | | 4,600 | | | | 50,148 | |
| | |
Nibe Industrier AB, Class B(a) | | | 2,898 | | | | 16,647 | |
| | |
Reliance Worldwide Corp. Ltd.(a) | | | 2,576 | | | | 5,692 | |
| | |
ROCKWOOL A/S, Class B | | | 92 | | | | 20,429 | |
| | |
Trane Technologies plc | | | 782 | | | | 148,822 | |
| | | | | | | 613,432 | |
|
Capital Markets – 1.9% | |
| | |
abrdn plc | | | 9,660 | | | | 18,362 | |
| | |
Allfunds Group plc | | | 2,438 | | | | 12,416 | |
| | |
ASX Ltd. | | | 1,702 | | | | 60,487 | |
| | |
BlackRock, Inc. | | | 1,380 | | | | 844,946 | |
| | |
Daiwa Securities Group, Inc. | | | 9,200 | | | | 52,486 | |
| | |
Euronext NV(b) | | | 414 | | | | 28,794 | |
| | |
FactSet Research Systems, Inc. | | | 184 | | | | 79,468 | |
| | |
Goldman Sachs Group, Inc. (The) | | | 1,656 | | | | 502,778 | |
| | |
Hargreaves Lansdown plc | | | 1,357 | | | | 11,635 | |
| | |
Hong Kong Exchanges & Clearing Ltd. | | | 6,900 | | | | 242,504 | |
| | |
IG Group Holdings plc | | | 1,288 | | | | 9,972 | |
| | |
Julius Baer Group Ltd. | | | 1,104 | | | | 65,023 | |
See Accompanying Notes to the Financial Statements.
| | | | |
288 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
London Stock Exchange Group plc | | | 2,300 | | | $ | 231,090 | |
| | |
Macquarie Group Ltd. | | | 2,576 | | | | 262,558 | |
| | |
Man Group plc | | | 2,576 | | | | 6,861 | |
| | |
Nasdaq, Inc. | | | 1,196 | | | | 59,322 | |
| | |
S&P Global, Inc. | | | 1,012 | | | | 353,502 | |
| | |
Schroders plc | | | 3,772 | | | | 16,903 | |
| | | | | | | 2,859,107 | |
|
Chemicals – 0.9% | |
| | |
Air Liquide SA | | | 1,702 | | | | 290,865 | |
| | |
Akzo Nobel NV | | | 1,012 | | | | 67,668 | |
| | |
Arkema SA | | | 276 | | | | 25,783 | |
| | |
BASF SE | | | 5,290 | | | | 243,427 | |
| | |
Chr Hansen Holding A/S | | | 368 | | | | 25,041 | |
| | |
Covestro AG* (b) | | | 736 | | | | 37,108 | |
| | |
Croda International plc | | | 966 | | | | 51,319 | |
| | |
DuPont de Nemours, Inc. | | | 1,564 | | | | 113,984 | |
| | |
Ecolab, Inc. | | | 920 | | | | 154,321 | |
| | |
Hexpol AB | | | 2,691 | | | | 23,773 | |
| | |
Incitec Pivot Ltd. | | | 17,066 | | | | 29,607 | |
| | |
Kansai Paint Co. Ltd. | | | 2,300 | | | | 33,396 | |
| | |
LANXESS AG | | | 92 | | | | 2,100 | |
| | |
Mitsubishi Chemical Group Corp. | | | 4,600 | | | | 25,760 | |
| | |
Novozymes A/S, Class B(a) | | | 1,380 | | | | 61,873 | |
| | |
OCI NV(a) | | | 598 | | | | 13,912 | |
| | |
Orica Ltd. | | | 2,346 | | | | 21,776 | |
| | |
Solvay SA | | | 460 | | | | 48,496 | |
| | |
Wacker Chemie AG | | | 92 | | | | 11,232 | |
| | |
Yara International ASA | | | 920 | | | | 30,058 | |
| | | | | | | 1,311,499 | |
|
Commercial Services & Supplies – 0.3% | |
| | |
Brambles Ltd. | | | 7,958 | | | | 66,056 | |
| | |
Cintas Corp. | | | 552 | | | | 279,930 | |
| | |
Elis SA | | | 1,656 | | | | 27,079 | |
| | |
ISS A/S | | | 598 | | | | 8,638 | |
| | |
Rentokil Initial plc | | | 11,914 | | | | 60,257 | |
| | |
SPIE SA | | | 759 | | | | 19,928 | |
| | |
TOPPAN Holdings, Inc. | | | 2,300 | | | | 52,426 | |
| | | | | | | 514,314 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Communications Equipment – 0.1% | |
| | |
F5, Inc.* | | | 230 | | | $ | 34,866 | |
| | |
Nokia OYJ | | | 12,466 | | | | 41,374 | |
| | | | | | | 76,240 | |
|
Construction & Engineering – 0.4% | |
| | |
Balfour Beatty plc | | | 2,990 | | | | 11,218 | |
| | |
Bouygues SA | | | 736 | | | | 25,836 | |
| | |
Eiffage SA | | | 529 | | | | 47,919 | |
| | |
Ferrovial SE | | | 2,576 | | | | 77,437 | |
| | |
HOCHTIEF AG | | | 46 | | | | 4,746 | |
| | |
Obayashi Corp. | | | 6,900 | | | | 58,683 | |
| | |
Shimizu Corp. | | | 6,900 | | | | 48,796 | |
| | |
Skanska AB, Class B | | | 2,116 | | | | 31,695 | |
| | |
Sweco AB, Class B | | | 1,334 | | | | 12,238 | |
| | |
Vinci SA | | | 3,082 | | | | 340,362 | |
| | |
Worley Ltd. | | | 2,024 | | | | 21,004 | |
| | | | | | | 679,934 | |
|
Construction Materials – 0.1% | |
| | |
Buzzi SpA | | | 368 | | | | 9,724 | |
| | |
Heidelberg Materials AG | | | 184 | | | | 13,319 | |
| | |
Holcim AG | | | 2,622 | | | | 161,576 | |
| | |
Wienerberger AG | | | 437 | | | | 10,596 | |
| | | | | | | 195,215 | |
|
Consumer Finance – 0.0%(c) | |
| | |
Cembra Money Bank AG | | | 46 | | | | 3,156 | |
| | |
Marui Group Co. Ltd.(a) | | | 2,300 | | | | 35,986 | |
| | | | | | | 39,142 | |
|
Consumer Staples Distribution & Retail – 2.1% | |
| | |
Aeon Co. Ltd. | | | 4,600 | | | | 96,195 | |
| | |
Axfood AB | | | 598 | | | | 13,199 | |
| | |
Carrefour SA | | | 3,450 | | | | 60,461 | |
| | |
Coles Group Ltd. | | | 4,876 | | | | 47,142 | |
| | |
Endeavour Group Ltd. | | | 9,430 | | | | 29,495 | |
| | |
HelloFresh SE* | | | 690 | | | | 14,995 | |
| | |
J Sainsbury plc | | | 9,108 | | | | 28,437 | |
| | |
Jeronimo Martins SGPS SA | | | 1,334 | | | | 30,711 | |
| | |
Kesko OYJ, Class B | | | 1,472 | | | | 24,840 | |
| | |
Koninklijke Ahold Delhaize NV | | | 5,382 | | | | 159,286 | |
| | |
Kroger Co. (The) | | | 3,220 | | | | 146,091 | |
| | |
Marks & Spencer Group plc* | | | 10,166 | | | | 26,744 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 289 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Ocado Group plc* | | | 2,530 | | | $ | 14,285 | |
| | |
Target Corp. | | | 2,254 | | | | 249,721 | |
| | |
Walgreens Boots Alliance, Inc. | | | 5,060 | | | | 106,665 | |
| | |
Walmart, Inc. | | | 11,730 | | | | 1,916,799 | |
| | |
Woolworths Group Ltd. | | | 8,970 | | | | 200,027 | |
| | | | | | | 3,165,093 | |
|
Containers & Packaging – 0.2% | |
| | |
Amcor plc | | | 6,808 | | | | 60,523 | |
| | |
Ball Corp.(a) | | | 1,196 | | | | 57,587 | |
| | |
Billerud Aktiebolag | | | 2,438 | | | | 22,585 | |
| | |
DS Smith plc | | | 8,165 | | | | 28,257 | |
| | |
Huhtamaki OYJ | | | 230 | | | | 7,879 | |
| | |
Orora Ltd. | | | 5,198 | | | | 8,096 | |
| | |
Smurfit Kappa Group plc(a) | | | 1,426 | | | | 46,334 | |
| | |
Verallia SA(b) | | | 184 | | | | 5,979 | |
| | | | | | | 237,240 | |
|
Distributors – 0.0%(c) | |
| | |
D’ieteren Group | | | 92 | | | | 13,624 | |
| | |
Inchcape plc | | | 1,656 | | | | 13,383 | |
| | | | | | | 27,007 | |
|
Diversified Consumer Services – 0.0%(c) | |
| | |
Pearson plc | | | 3,864 | | | | 44,618 | |
|
Diversified REITs – 0.1% | |
| | |
British Land Co. plc (The), REIT | | | 6,348 | | | | 22,917 | |
| | |
Charter Hall Group, REIT | | | 1,196 | | | | 6,565 | |
| | |
GPT Group (The), REIT | | | 12,006 | | | | 27,518 | |
| | |
Mirvac Group, REIT | | | 31,602 | | | | 36,416 | |
| | |
Stockland, REIT | | | 22,448 | | | | 50,314 | |
| | |
Suntec REIT, REIT | | | 18,400 | | | | 14,773 | |
| | | | | | | 158,503 | |
|
Diversified Telecommunication Services – 0.8% | |
| | |
BT Group plc(a) | | | 35,328 | | | | 48,335 | |
| | |
Cellnex Telecom SA(b) | | | 2,438 | | | | 71,434 | |
| | |
Chorus Ltd. | | | 2,070 | | | | 8,639 | |
| | |
Deutsche Telekom AG (Registered) | | | 19,090 | | | | 413,147 | |
| | |
Elisa OYJ | | | 322 | | | | 13,641 | |
| | |
Infrastrutture Wireless Italiane SpA(b) | | | 1,403 | | | | 15,304 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Diversified Telecommunication Services – (continued) | |
| | |
Koninklijke KPN NV | | | 20,378 | | | $ | 68,388 | |
| | |
Singapore Telecommunications Ltd. | | | 36,800 | | | | 63,928 | |
| | |
Spark New Zealand Ltd. | | | 14,306 | | | | 41,356 | |
| | |
Swisscom AG (Registered) | | | 138 | | | | 82,492 | |
| | |
Telenor ASA | | | 2,967 | | | | 30,316 | |
| | |
Telia Co. AB | | | 13,846 | | | | 29,259 | |
| | |
Telstra Group Ltd. | | | 67,482 | | | | 162,787 | |
| | |
TELUS Corp. | | | 5,750 | | | | 92,613 | |
| | | | | | | 1,141,639 | |
|
Electric Utilities – 0.8% | |
| | |
Chugoku Electric Power Co., Inc. (The) | | | 4,600 | | | | 28,591 | |
| | |
Contact Energy Ltd. | | | 782 | | | | 3,543 | |
| | |
EDP – Energias de Portugal SA | | | 17,802 | | | | 74,702 | |
| | |
Elia Group SA/NV | | | 92 | | | | 8,718 | |
| | |
Endesa SA(a) | | | 1,748 | | | | 32,823 | |
| | |
Enel SpA | | | 23,460 | | | | 148,486 | |
| | |
Entergy Corp. | | | 736 | | | | 70,354 | |
| | |
Fortum OYJ(a) | | | 2,438 | | | | 28,862 | |
| | |
Iberdrola SA | | | 37,674 | | | | 418,125 | |
| | |
Kansai Electric Power Co., Inc. (The) | | | 4,600 | | | | 58,516 | |
| | |
Kyushu Electric Power Co., Inc.* | | | 4,600 | | | | 29,274 | |
| | |
Origin Energy Ltd. | | | 8,878 | | | | 51,321 | |
| | |
Orsted A/S | | | 690 | | | | 33,204 | |
| | |
Redeia Corp. SA | | | 1,196 | | | | 18,590 | |
| | |
SSE plc | | | 6,670 | | | | 132,170 | |
| | |
Terna – Rete Elettrica Nazionale | | | 3,312 | | | | 25,297 | |
| | |
Verbund AG | | | 506 | | | | 43,857 | |
| | | | | | | 1,206,433 | |
|
Electrical Equipment – 0.7% | |
| | |
ABB Ltd. (Registered) | | | 6,808 | | | | 227,719 | |
| | |
Fujikura Ltd. | | | 2,300 | | | | 16,265 | |
| | |
Legrand SA | | | 1,656 | | | | 142,622 | |
| | |
NEL ASA* | | | 6,256 | | | | 4,099 | |
| | |
Nexans SA | | | 253 | | | | 17,837 | |
| | |
Nidec Corp. | | | 2,300 | | | | 82,329 | |
| | |
Prysmian SpA | | | 1,610 | | | | 60,056 | |
| | |
Schneider Electric SE | | | 2,346 | | | | 359,510 | |
| | |
Siemens Energy AG* | | | 3,036 | | | | 26,860 | |
| | |
Signify NV(b) | | | 138 | | | | 3,568 | |
See Accompanying Notes to the Financial Statements.
| | | | |
290 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electrical Equipment – (continued) | |
| | |
Vestas Wind Systems A/S* | | | 4,968 | | | $ | 107,122 | |
| | | | | | | 1,047,987 | |
|
Electronic Equipment, Instruments & Components – 0.8% | |
| | |
Alps Alpine Co. Ltd. | | | 4,600 | | | | 37,330 | |
| | |
CDW Corp. | | | 920 | | | | 184,368 | |
| | |
Corning, Inc. | | | 2,346 | | | | 62,779 | |
| | |
Flex Ltd.* | | | 1,150 | | | | 29,578 | |
| | |
Halma plc | | | 1,564 | | | | 35,015 | |
| | |
Hexagon AB, Class B | | | 8,602 | | | | 69,831 | |
| | |
Ibiden Co. Ltd. | | | 1,500 | | | | 62,805 | |
| | |
Jabil, Inc. | | | 322 | | | | 39,542 | |
| | |
Keyence Corp. | | | 700 | | | | 268,777 | |
| | |
Kyocera Corp. | | | 800 | | | | 38,953 | |
| | |
Murata Manufacturing Co. Ltd. | | | 13,800 | | | | 225,755 | |
| | |
Omron Corp. | | | 1,200 | | | | 42,368 | |
| | |
TDK Corp. | | | 2,300 | | | | 84,409 | |
| | |
Venture Corp. Ltd. | | | 2,300 | | | | 19,642 | |
| | |
Yokogawa Electric Corp. | | | 2,300 | | | | 41,195 | |
| | | | | | | 1,242,347 | |
|
Energy Equipment & Services – 0.4% | |
| | |
Baker Hughes Co., Class A(a) | | | 3,082 | | | | 106,083 | |
| | |
Schlumberger NV(a) | | | 9,246 | | | | 514,632 | |
| | |
Technip Energies NV | | | 138 | | | | 3,012 | |
| | |
Tenaris SA | | | 1,265 | | | | 19,843 | |
| | | | | | | 643,570 | |
|
Entertainment – 0.5% | |
| | |
Bollore SE | | | 4,117 | | | | 22,411 | |
| | |
Walt Disney Co. (The)* | | | 8,970 | | | | 731,862 | |
| | | | | | | 754,273 | |
|
Financial Services – 3.2% | |
| | |
AMP Ltd.(a) | | | 26,105 | | | | 17,272 | |
| | |
Apollo Global Management, Inc.(a) | | | 2,254 | | | | 174,550 | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 8,464 | | | | 2,889,017 | |
| | |
Edenred SE | | | 1,564 | | | | 83,054 | |
| | |
EXOR NV | | | 598 | | | | 51,161 | |
| | |
Kinnevik AB, Class B* | | | 690 | | | | 5,866 | |
| | |
M&G plc | | | 14,398 | | | | 34,628 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Financial Services – (continued) | |
| | |
Nexi SpA* (b) | | | 4,232 | | | $ | 24,495 | |
| | |
ORIX Corp. | | | 6,900 | | | | 123,698 | |
| | |
PayPal Holdings, Inc.* | | | 3,680 | | | | 190,624 | |
| | |
Visa, Inc., Class A | | | 5,198 | | | | 1,222,050 | |
| | |
Wendel SE | | | 230 | | | | 17,164 | |
| | |
Worldline SA* (b) | | | 1,380 | | | | 17,475 | |
| | | | | | | 4,851,054 | |
|
Food Products – 1.1% | |
| | |
AAK AB | | | 1,610 | | | | 30,550 | |
| | |
Ajinomoto Co., Inc. | | | 4,600 | | | | 166,450 | |
| | |
Associated British Foods plc | | | 1,886 | | | | 46,366 | |
| | |
Bakkafrost P/F | | | 46 | | | | 2,073 | |
| | |
Danone SA | | | 2,024 | | | | 120,125 | |
| | |
Darling Ingredients, Inc.* (a) | | | 552 | | | | 24,448 | |
| | |
General Mills, Inc. | | | 2,530 | | | | 165,057 | |
| | |
Hershey Co. (The)(a) | | | 736 | | | | 137,890 | |
| | |
JDE Peet’s NV | | | 92 | | | | 2,552 | |
| | |
Kellogg Co. | | | 1,978 | | | | 99,830 | |
| | |
Kerry Group plc, Class A | | | 1,012 | | | | 77,958 | |
| | |
McCormick & Co., Inc. (Non-Voting) | | | 690 | | | | 44,091 | |
| | |
MEIJI Holdings Co. Ltd. | | | 2,300 | | | | 56,465 | |
| | |
Mowi ASA | | | 2,852 | | | | 46,284 | |
| | |
Nestle SA (Registered) | | | 5,704 | | | | 614,619 | |
| | |
Orkla ASA | | | 3,726 | | | | 25,661 | |
| | |
Salmar ASA | | | 368 | | | | 17,419 | |
| | |
Viscofan SA | | | 46 | | | | 2,655 | |
| | | | | | | 1,680,493 | |
|
Gas Utilities –0.1% | |
| | |
APA Group | | | 5,382 | | | | 28,079 | |
| | |
Enagas SA(a) | | | 322 | | | | 5,376 | |
| | |
Naturgy Energy Group SA(a) | | | 805 | | | | 22,719 | |
| | |
Rubis SCA | | | 276 | | | | 5,992 | |
| | |
Snam SpA | | | 10,810 | | | | 49,475 | |
| | |
Tokyo Gas Co. Ltd. | | | 2,300 | | | | 51,317 | |
| | | | | | | 162,958 | |
|
Ground Transportation – 0.5% | |
| | |
Aurizon Holdings Ltd. | | | 6,900 | | | | 14,941 | |
| | |
Canadian National Railway Co. | | | 2,944 | | | | 311,164 | |
| | |
Canadian Pacific Kansas City Ltd. | | | 4,738 | | | | 336,037 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 291 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Ground Transportation – (continued) | |
| | |
ComfortDelGro Corp. Ltd. | | | 13,800 | | | $ | 13,296 | |
| | |
Hankyu Hanshin Holdings, Inc. | | | 1,300 | | | | 40,577 | |
| | |
MTR Corp. Ltd. | | | 11,500 | | | | 42,989 | |
| | | | | | | 759,004 | |
|
Health Care Equipment & Supplies –2.0% | |
| | |
Alcon, Inc. | | | 2,622 | | | | 186,757 | |
| | |
Ansell Ltd. | | | 322 | | | | 4,326 | |
| | |
Becton Dickinson & Co. | | | 966 | | | | 244,186 | |
| | |
BioMerieux | | | 230 | | | | 22,001 | |
| | |
Boston Scientific Corp.* | | | 4,646 | | | | 237,829 | |
| | |
Carl Zeiss Meditec AG | | | 46 | | | | 3,974 | |
| | |
Cochlear Ltd. | | | 460 | | | | 70,144 | |
| | |
Coloplast A/S, Class B | | | 391 | | | | 40,698 | |
| | |
ConvaTec Group plc(b) | | | 9,660 | | | | 23,936 | |
| | |
Demant A/S* | | | 552 | | | | 21,005 | |
| | |
Edwards Lifesciences Corp.* | | | 3,082 | | | | 196,385 | |
| | |
Elekta AB, Class B | | | 4,002 | | | | 27,187 | |
| | |
EssilorLuxottica SA | | | 920 | | | | 165,937 | |
| | |
Fisher & Paykel Healthcare Corp. Ltd.(a) | | | 4,416 | | | | 53,452 | |
| | |
Getinge AB, Class B | | | 1,058 | | | | 18,977 | |
| | |
Hologic, Inc.* | | | 1,334 | | | | 88,271 | |
| | |
Hoya Corp. | | | 2,300 | | | | 217,706 | |
| | |
IDEXX Laboratories, Inc.* | | | 276 | | | | 110,254 | |
| | |
Koninklijke Philips NV* | | | 5,198 | | | | 98,337 | |
| | |
Medtronic plc | | | 4,370 | | | | 308,347 | |
| | |
Olympus Corp. | | | 6,900 | | | | 91,077 | |
| | |
Smith & Nephew plc | | | 1,150 | | | | 12,849 | |
| | |
Straumann Holding AG (Registered) | | | 736 | | | | 86,496 | |
| | |
Stryker Corp. | | | 2,208 | | | | 596,646 | |
| | |
Terumo Corp. | | | 2,300 | | | | 62,145 | |
| | |
Zimmer Biomet Holdings, Inc. | | | 690 | | | | 72,043 | |
| | | | | | | 3,060,965 | |
|
Health Care Providers & Services – 2.1% | |
| | |
Cardinal Health, Inc. | | | 1,196 | | | | 108,836 | |
| | |
Cigna Group (The) | | | 874 | | | | 270,241 | |
| | |
CVS Health Corp. | | | 6,302 | | | | 434,901 | |
| | |
Elevance Health, Inc. | | | 1,518 | | | | 683,237 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Providers & Services – (continued) | |
| | |
Fresenius Medical Care AG & Co. KGaA | | | 1,058 | | | $ | 35,025 | |
| | |
Fresenius SE & Co. KGaA | | | 2,070 | | | | 53,037 | |
| | |
Galenica AG(b) | | | 184 | | | | 13,860 | |
| | |
Sonic Healthcare Ltd. | | | 736 | | | | 13,397 | |
| | |
UnitedHealth Group, Inc. | | | 2,990 | | | | 1,601,324 | |
| | | | | | | 3,213,858 | |
|
Health Care REITs – 0.3% | |
| | |
Cofinimmo SA, REIT | | | 322 | | | | 19,979 | |
| | |
Healthpeak Properties, Inc., REIT | | | 4,968 | | | | 77,252 | |
| | |
Ventas, Inc., REIT | | | 1,978 | | | | 83,986 | |
| | |
Welltower, Inc., REIT | | | 3,358 | | | | 280,762 | |
| | | | | | | 461,979 | |
|
Hotels, Restaurants & Leisure – 1.5% | |
| | |
Accor SA | | | 1,357 | | | | 43,131 | |
| | |
Amadeus IT Group SA | | | 2,944 | | | | 167,477 | |
| | |
Booking Holdings, Inc.* | | | 115 | | | | 320,799 | |
| | |
Caesars Entertainment, Inc.* | | | 828 | | | | 33,029 | |
| | |
Compass Group plc | | | 10,442 | | | | 262,667 | |
| | |
Darden Restaurants, Inc. | | | 414 | | | | 60,249 | |
| | |
Domino’s Pizza Enterprises Ltd. | | | 644 | | | | 20,714 | |
| | |
Domino’s Pizza, Inc. | | | 138 | | | | 46,781 | |
| | |
Entain plc | | | 3,956 | | | | 44,663 | |
| | |
Greggs plc | | | 851 | | | | 24,474 | |
| | |
Hilton Worldwide Holdings, Inc. | | | 1,242 | | | | 188,200 | |
| | |
InterContinental Hotels Group plc | | | 1,058 | | | | 74,591 | |
| | |
Just Eat Takeaway.com NV* (a) (b) | | | 1,564 | | | | 18,938 | |
| | |
Kindred Group plc, SDR | | | 552 | | | | 4,509 | |
| | |
La Francaise des Jeux SAEM(b) | | | 276 | | | | 8,874 | |
| | |
Las Vegas Sands Corp. | | | 874 | | | | 41,480 | |
| | |
Marriott International, Inc., Class A | | | 828 | | | | 156,128 | |
| | |
MGM Resorts International(a) | | | 1,564 | | | | 54,615 | |
| | |
Oriental Land Co. Ltd. | | | 9,200 | | | | 295,054 | |
| | |
Sodexo SA | | | 529 | | | | 55,848 | |
| | |
SSP Group plc* | | | 1,150 | | | | 2,512 | |
| | |
TUI AG* | | | 2,300 | | | | 11,566 | |
| | |
Whitbread plc | | | 736 | | | | 29,722 | |
| | |
Yum China Holdings, Inc. | | | 1,518 | | | | 79,786 | |
| | |
Yum! Brands, Inc. | | | 1,840 | | | | 222,382 | |
| | | | | | | 2,268,189 | |
See Accompanying Notes to the Financial Statements.
| | | | |
292 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Household Durables – 0.9% | |
| | |
Barratt Developments plc | | | 6,302 | | | $ | 31,652 | |
| | |
Electrolux AB, Class B* | | | 46 | | | | 385 | |
| | |
GN Store Nord A/S* | | | 506 | | | | 8,405 | |
| | |
Nikon Corp. | | | 2,300 | | | | 21,505 | |
| | |
Panasonic Holdings Corp. | | | 11,500 | | | | 99,399 | |
| | |
Persimmon plc | | | 644 | | | | 7,940 | |
| | |
SEB SA | | | 184 | | | | 18,117 | |
| | |
Sekisui House Ltd. | | | 4,600 | | | | 89,269 | |
| | |
Sony Group Corp. | | | 13,100 | | | | 1,074,763 | |
| | |
Taylor Wimpey plc | | | 22,448 | | | | 30,181 | |
| | |
Vistry Group plc | | | 920 | | | | 7,893 | |
| | | | | | | 1,389,509 | |
|
Household Products – 1.2% | |
| | |
Clorox Co. (The) | | | 644 | | | | 75,799 | |
| | |
Colgate-Palmolive Co. | | | 2,760 | | | | 207,331 | |
| | |
Essity AB, Class B | | | 2,438 | | | | 55,491 | |
| | |
Henkel AG & Co. KGaA (Preference) | | | 1,104 | | | | 79,445 | |
| | |
Procter & Gamble Co. (The) | | | 7,682 | | | | 1,152,531 | |
| | |
Reckitt Benckiser Group plc | | | 3,634 | | | | 242,620 | |
| | |
Unicharm Corp. | | | 1,200 | | | | 40,577 | |
| | | | | | | 1,853,794 | |
|
Independent Power and Renewable Electricity Producers – 0.1% | |
| | |
AES Corp. (The)(a) | | | 3,726 | | | | 55,518 | |
| | |
Drax Group plc | | | 2,438 | | | | 12,502 | |
| | |
EDP Renovaveis SA | | | 598 | | | | 9,601 | |
| | |
Meridian Energy Ltd. | | | 8,142 | | | | 22,874 | |
| | | | | | | 100,495 | |
|
Industrial Conglomerates – 0.4% | |
| | |
DCC plc | | | 299 | | | | 16,563 | |
| | |
Hitachi Ltd. | | | 4,600 | | | | 287,855 | |
| | |
Investment AB Latour, Class B(a) | | | 322 | | | | 5,555 | |
| | |
Keppel Corp. Ltd. | | | 4,600 | | | | 20,850 | |
| | |
Lifco AB, Class B | | | 552 | | | | 10,069 | |
| | |
Siemens AG (Registered) | | | 1,610 | | | | 212,653 | |
| | | | | | | 553,545 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Industrial REITs – 0.2% | |
| | |
CapitaLand Ascendas REIT, REIT | | | 13,800 | | | $ | 26,189 | |
| | |
Goodman Group, REIT | | | 11,040 | | | | 144,972 | |
| | |
Segro plc, REIT | | | 7,222 | | | | 62,466 | |
| | |
Warehouses De Pauw CVA, REIT | | | 506 | | | | 12,473 | |
| | | | | | | 246,100 | |
|
Insurance – 1.9% | |
| | |
Admiral Group plc | | | 828 | | | | 24,546 | |
| | |
Aegon Ltd. | | | 5,221 | | | | 25,297 | |
| | |
Aflac, Inc. | | | 1,794 | | | | 140,129 | |
| | |
Ageas SA/NV | | | 1,012 | | | | 38,787 | |
| | |
Allianz SE (Registered) | | | 736 | | | | 171,850 | |
| | |
ASR Nederland NV | | | 506 | | | | 18,826 | |
| | |
Assicurazioni Generali SpA | | | 5,934 | | | | 117,573 | |
| | |
Aviva plc | | | 12,282 | | | | 59,257 | |
| | |
AXA SA | | | 11,592 | | | | 342,525 | |
| | |
Beazley plc | | | 3,772 | | | | 23,549 | |
| | |
Direct Line Insurance Group plc* | | | 3,680 | | | | 6,756 | |
| | |
Hannover Rueck SE | | | 322 | | | | 70,896 | |
| | |
Hiscox Ltd. | | | 460 | | | | 5,236 | |
| | |
Insurance Australia Group Ltd. | | | 13,340 | | | | 47,890 | |
| | |
Japan Post Holdings Co. Ltd. | | | 9,200 | | | | 81,038 | |
| | |
Medibank Pvt Ltd. | | | 14,122 | | | | 30,669 | |
| | |
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | | | 736 | | | | 294,455 | |
| | |
nib holdings Ltd.(a) | | | 3,082 | | | | 14,128 | |
| | |
NN Group NV | | | 1,703 | | | | 54,470 | |
| | |
Phoenix Group Holdings plc | | | 4,554 | | | | 25,077 | |
| | |
Poste Italiane SpA(b) | | | 2,622 | | | | 25,885 | |
| | |
Power Corp. of Canada | | | 2,714 | | | | 65,316 | |
| | |
Prudential plc | | | 5,336 | | | | 55,542 | |
| | |
QBE Insurance Group Ltd. | | | 5,612 | | | | 55,431 | |
| | |
Sampo OYJ, Class A | | | 2,300 | | | | 90,218 | |
| | |
Storebrand ASA | | | 2,760 | | | | 23,011 | |
| | |
Sun Life Financial, Inc. | | | 3,680 | | | | 167,903 | |
| | |
Suncorp Group Ltd. | | | 6,072 | | | | 51,439 | |
| | |
Swiss Life Holding AG (Registered) | | | 138 | | | | 88,224 | |
| | |
Swiss Re AG | | | 1,242 | | | | 135,275 | |
| | |
Tokio Marine Holdings, Inc. | | | 7,200 | | | | 158,933 | |
| | |
Topdanmark A/S | | | 24 | | | | 1,074 | |
| | |
Tryg A/S(a) | | | 2,622 | | | | 51,112 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 293 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Zurich Insurance Group AG | | | 644 | | | $ | 304,716 | |
| | | | | | | 2,867,033 | |
|
Interactive Media & Services – 4.6% | |
| | |
Alphabet, Inc., Class C* | | | 18,860 | | | | 2,363,158 | |
| | |
Auto Trader Group plc(b) | | | 5,980 | | | | 45,077 | |
| | |
carsales.com Ltd. | | | 2,795 | | | | 48,896 | |
| | |
LY Corp. | | | 23,000 | | | | 58,060 | |
| | |
Meta Platforms, Inc., Class A* | | | 14,398 | | | | 4,337,685 | |
| | |
REA Group Ltd. | | | 506 | | | | 46,041 | |
| | |
Rightmove plc(a) | | | 3,266 | | | | 18,746 | |
| | |
Snap, Inc., Class A* (a) | | | 6,532 | | | | 65,385 | |
| | | | | | | 6,983,048 | |
|
IT Services – 2.7% | |
| | |
Accenture plc, Class A | | | 6,486 | | | | 1,926,926 | |
| | |
Akamai Technologies, Inc.* | | | 1,104 | | | | 114,076 | |
| | |
Alten SA | | | 92 | | | | 10,823 | |
| | |
Amdocs Ltd. | | | 552 | | | | 44,248 | |
| | |
Capgemini SE | | | 1,058 | | | | 186,198 | |
| | |
CGI, Inc.* | | | 2,070 | | | | 199,627 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 3,312 | | | | 213,525 | |
| | |
Computacenter plc | | | 575 | | | | 17,904 | |
| | |
Fujitsu Ltd. | | | 1,600 | | | | 205,117 | |
| | |
Gartner, Inc.* (a) | | | 506 | | | | 168,012 | |
| | |
International Business Machines Corp. | | | 5,888 | | | | 851,640 | |
| | |
NEC Corp. | | | 2,300 | | | | 109,423 | |
| | |
Nomura Research Institute Ltd. | | | 2,300 | | | | 59,898 | |
| | |
Reply SpA | | | 230 | | | | 21,600 | |
| | |
Softcat plc | | | 644 | | | | 9,886 | |
| | |
Sopra Steria Group SACA | | | 92 | | | | 16,463 | |
| | | | | | | 4,155,366 | |
|
Leisure Products – 0.1% | |
| | |
Bandai Namco Holdings, Inc. | | | 2,900 | | | | 59,419 | |
| | |
Thule Group AB(b) | | | 690 | | | | 15,643 | |
| | |
Yamaha Corp. | | | 900 | | | | 23,646 | |
| | | | | | | 98,708 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Life Sciences Tools & Services – 0.7% | |
| | |
Danaher Corp. | | | 2,254 | | | $ | 432,813 | |
| | |
Eurofins Scientific SE(a) | | | 966 | | | | 48,837 | |
| | |
Gerresheimer AG | | | 92 | | | | 8,548 | |
| | |
Illumina, Inc.* | | | 322 | | | | 35,233 | |
| | |
IQVIA Holdings, Inc.* | | | 1,242 | | | | 224,591 | |
| | |
Lonza Group AG (Registered) | | | 230 | | | | 80,066 | |
| | |
QIAGEN NV* | | | 736 | | | | 27,322 | |
| | |
Sartorius AG (Preference) | | | 184 | | | | 45,938 | |
| | |
Siegfried Holding AG (Registered) | | | 23 | | | | 18,184 | |
| | |
Tecan Group AG (Registered) | | | 46 | | | | 13,162 | |
| | |
Wuxi Biologics Cayman, Inc.* (b) | | | 11,500 | | | | 71,429 | |
| | | | | | | 1,006,123 | |
|
Machinery – 1.3% | |
| | |
Aalberts NV | | | 230 | | | | 7,152 | |
| | |
Alfa Laval AB | | | 1,357 | | | | 43,798 | |
| | |
Alstom SA(a) | | | 1,649 | | | | 22,223 | |
| | |
ANDRITZ AG | | | 299 | | | | 13,716 | |
| | |
Atlas Copco AB, Class A | | | 9,844 | | | | 127,052 | |
| | |
Bucher Industries AG (Registered) | | | 46 | | | | 16,347 | |
| | |
CNH Industrial NV | | | 5,106 | | | | 56,480 | |
| | |
Cummins, Inc. | | | 414 | | | | 89,548 | |
| | |
Daimler Truck Holding AG | | | 1,564 | | | | 48,966 | |
| | |
Ebara Corp. | | | 300 | | | | 13,074 | |
| | |
Epiroc AB, Class A | | | 4,646 | | | | 76,306 | |
| | |
FANUC Corp. | | | 4,600 | | | | 110,956 | |
| | |
Fortive Corp. | | | 1,472 | | | | 96,092 | |
| | |
GEA Group AG | | | 690 | | | | 23,506 | |
| | |
Georg Fischer AG (Registered) | | | 506 | | | | 26,088 | |
| | |
Husqvarna AB, Class B(a) | | | 4,278 | | | | 27,607 | |
| | |
IMI plc | | | 667 | | | | 11,857 | |
| | |
Indutrade AB | | | 690 | | | | 12,176 | |
| | |
Interpump Group SpA | | | 322 | | | | 13,410 | |
| | |
KION Group AG | | | 322 | | | | 9,816 | |
| | |
Knorr-Bremse AG | | | 506 | | | | 28,101 | |
| | |
Komatsu Ltd. | | | 2,300 | | | | 52,593 | |
| | |
Kone OYJ, Class B | | | 2,346 | | | | 101,396 | |
| | |
Kubota Corp. | | | 4,600 | | | | 61,173 | |
| | |
Metso OYJ | | | 3,864 | | | | 33,924 | |
| | |
MINEBEA MITSUMI, Inc. | | | 2,300 | | | | 35,378 | |
| | |
Nordson Corp. | | | 253 | | | | 53,785 | |
| | |
Otis Worldwide Corp. | | | 1,104 | | | | 85,240 | |
| | |
Rotork plc | | | 7,199 | | | | 25,578 | |
See Accompanying Notes to the Financial Statements.
| | | | |
294 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
Sandvik AB | | | 2,898 | | | $ | 49,179 | |
| | |
Schindler Holding AG | | | 184 | | | | 37,041 | |
| | |
Seatrium Ltd.* | | | 138,000 | | | | 11,281 | |
| | |
SFS Group AG | | | 23 | | | | 2,285 | |
| | |
SKF AB, Class B | | | 782 | | | | 12,606 | |
| | |
Spirax-Sarco Engineering plc | | | 414 | | | | 41,154 | |
| | |
Stanley Black & Decker, Inc. | | | 736 | | | | 62,597 | |
| | |
Techtronic Industries Co. Ltd. | | | 6,500 | | | | 59,230 | |
| | |
Toro Co. (The) | | | 322 | | | | 26,030 | |
| | |
Trelleborg AB, Class B | | | 1,978 | | | | 49,854 | |
| | |
Valmet OYJ(a) | | | 552 | | | | 12,346 | |
| | |
Volvo AB, Class B | | | 8,970 | | | | 177,350 | |
| | |
Wartsila OYJ Abp(a) | | | 3,427 | | | | 40,715 | |
| | |
Weir Group plc (The) | | | 1,035 | | | | 21,439 | |
| | | | | | | 1,926,445 | |
|
Marine Transportation – 0.1% | |
| | |
AP Moller – Maersk A/S, Class B | | | 23 | | | | 38,190 | |
| | |
Mitsui OSK Lines Ltd. | | | 2,300 | | | | 58,971 | |
| | |
Nippon Yusen KK | | | 2,300 | | | | 55,843 | |
| | | | | | | 153,004 | |
|
Media – 0.2% | |
| | |
Dentsu Group, Inc. | | | 1,200 | | | | 34,468 | |
| | |
Informa plc | | | 7,958 | | | | 68,717 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | 1,656 | | | | 47,030 | |
| | |
ITV plc | | | 19,343 | | | | 14,989 | |
| | |
Publicis Groupe SA | | | 1,380 | | | | 104,615 | |
| | |
SES SA, Class A, ADR | | | 3,036 | | | | 17,666 | |
| | |
Vivendi SE | | | 4,554 | | | | 40,703 | |
| | |
WPP plc | | | 4,738 | | | | 40,625 | |
| | | | | | | 368,813 | |
|
Metals & Mining – 1.6% | |
| | |
Anglo American plc | | | 4,876 | | | | 124,045 | |
| | |
Antofagasta plc | | | 1,679 | | | | 27,403 | |
| | |
ArcelorMittal SA | | | 2,346 | | | | 51,777 | |
| | |
Aurubis AG | | | 184 | | | | 15,104 | |
| | |
BHP Group Ltd. | | | 32,660 | | | | 920,201 | |
| | |
BlueScope Steel Ltd. | | | 3,082 | | | | 36,686 | |
| | |
Boliden AB | | | 1,518 | | | | 38,824 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Fortescue Metals Group Ltd. | | | 12,374 | | | $ | 174,712 | |
| | |
Freeport-McMoRan, Inc. | | | 4,692 | | | | 158,496 | |
| | |
IGO Ltd. | | | 1,311 | | | | 7,894 | |
| | |
Iluka Resources Ltd. | | | 2,162 | | | | 9,911 | |
| | |
KGHM Polska Miedz SA | | | 506 | | | | 13,479 | |
| | |
Lynas Rare Earths Ltd.* | | | 7,912 | | | | 35,317 | |
| | |
Mineral Resources Ltd.(a) | | | 1,242 | | | | 45,421 | |
| | |
Newcrest Mining Ltd.(a) | | | 5,198 | | | | 76,847 | |
| | |
Newmont Corp. | | | 3,910 | | | | 146,482 | |
| | |
Norsk Hydro ASA | | | 7,728 | | | | 44,050 | |
| | |
Northern Star Resources Ltd. | | | 7,291 | | | | 53,964 | |
| | |
Rio Tinto Ltd. | | | 2,024 | | | | 150,678 | |
| | |
Rio Tinto plc | | | 4,048 | | | | 258,128 | |
| | |
Sims Ltd. | | | 138 | | | | 1,090 | |
| | |
South32 Ltd. | | | 29,992 | | | | 63,045 | |
| | |
SSAB AB, Class B | | | 3,358 | | | | 19,452 | |
| | |
thyssenkrupp AG | | | 1,426 | | | | 9,885 | |
| | |
voestalpine AG | | | 782 | | | | 19,474 | |
| | | | | | | 2,502,365 | |
|
Multi-Utilities – 0.6% | |
| | |
A2A SpA | | | 10,971 | | | | 20,537 | |
| | |
AGL Energy Ltd. | | | 3,956 | | | | 26,926 | |
| | |
Centrica plc | | | 14,122 | | | | 26,956 | |
| | |
CMS Energy Corp.(a) | | | 1,104 | | | | 59,991 | |
| | |
Consolidated Edison, Inc. | | | 1,104 | | | | 96,920 | |
| | |
Engie SA | | | 11,362 | | | | 180,193 | |
| | |
Hera SpA | | | 8,119 | | | | 22,776 | |
| | |
National Grid plc | | | 21,712 | | | | 257,826 | |
| | |
Public Service Enterprise Group, Inc. | | | 2,438 | | | | 150,303 | |
| | |
Veolia Environnement SA | | | 2,392 | | | | 65,307 | |
| | | | | | | 907,735 | |
|
Office REITs – 0.1% | |
| | |
Alexandria Real Estate Equities, Inc., REIT | | | 598 | | | | 55,692 | |
| | |
Covivio SA, REIT | | | 322 | | | | 13,750 | |
| | |
Dexus, REIT | | | 1,610 | | | | 6,605 | |
| | |
Gecina SA, REIT | | | 184 | | | | 18,010 | |
| | |
Keppel REIT, REIT | | | 920 | | | | 534 | |
| | | | | | | 94,591 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 295 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – 6.4% | |
| | |
Aker BP ASA | | | 920 | | | $ | 26,443 | |
| | |
Ampol Ltd. | | | 1,564 | | | | 31,549 | |
| | |
BP plc | | | 65,642 | | | | 400,337 | |
| | |
Cameco Corp. | | | 1,472 | | | | 60,152 | |
| | |
Chevron Corp. | | | 16,928 | | | | 2,466,917 | |
| | |
Coterra Energy, Inc. | | | 3,956 | | | | 108,790 | |
| | |
Enbridge, Inc. | | | 5,704 | | | | 182,594 | |
| | |
Eni SpA | | | 14,628 | | | | 238,545 | |
| | |
Equinor ASA | | | 5,750 | | | | 192,727 | |
| | |
Exxon Mobil Corp. | | | 32,568 | | | | 3,447,323 | |
| | |
Galp Energia SGPS SA | | | 1,150 | | | | 17,273 | |
| | |
Gaztransport Et Technigaz SA | | | 184 | | | | 23,475 | |
| | |
Marathon Oil Corp. | | | 2,576 | | | | 70,351 | |
| | |
Neste OYJ | | | 782 | | | | 26,211 | |
| | |
OMV AG | | | 276 | | | | 12,066 | |
| | |
Phillips 66 | | | 2,990 | | | | 341,069 | |
| | |
Shell plc(a) | | | 38,502 | | | | 1,254,880 | |
| | |
Suncor Energy, Inc. | | | 4,554 | | | | 147,322 | |
| | |
TotalEnergies SE | | | 7,866 | | | | 525,468 | |
| | |
Woodside Energy Group Ltd. | | | 5,152 | | | | 111,756 | |
| | | | | | | 9,685,248 | |
|
Paper & Forest Products – 0.1% | |
| | |
Holmen AB, Class B | | | 460 | | | | 17,321 | |
| | |
Mondi plc | | | 2,530 | | | | 40,801 | |
| | |
Oji Holdings Corp. | | | 4,600 | | | | 19,542 | |
| | |
Stora Enso OYJ, Class R | | | 3,910 | | | | 46,805 | |
| | |
Svenska Cellulosa AB SCA, Class B(a) | | | 552 | | | | 7,557 | |
| | | | | | | 132,026 | |
|
Passenger Airlines – 0.1% | |
| | |
Air France-KLM* | | | 506 | | | | 5,698 | |
| | |
ANA Holdings, Inc.* | | | 2,300 | | | | 44,832 | |
| | |
International Consolidated Airlines Group SA* | | | 16,330 | | | | 28,564 | |
| | |
Qantas Airways Ltd.* | | | 11,914 | | | | 37,038 | |
| | |
Singapore Airlines Ltd. | | | 6,900 | | | | 30,772 | |
| | | | | | | 146,904 | |
|
Personal Care Products – 1.2% | |
| | |
Beiersdorf AG | | | 437 | | | | 57,300 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Personal Care Products – (continued) | |
| | |
Estee Lauder Cos., Inc. (The), Class A | | | 1,150 | | | $ | 148,201 | |
| | |
Haleon plc | | | 27,232 | | | | 108,882 | |
| | |
Kao Corp. | | | 2,800 | | | | 101,576 | |
| | |
L’Oreal SA | | | 1,518 | | | | 635,633 | |
| | |
Shiseido Co. Ltd. | | | 3,400 | | | | 106,909 | |
| | |
Unilever plc | | | 14,490 | | | | 683,791 | |
| | | | | | | 1,842,292 | |
|
Pharmaceuticals – 7.5% | |
| | |
Astellas Pharma, Inc. | | | 13,800 | | | | 173,132 | |
| | |
AstraZeneca plc | | | 9,062 | | | | 1,127,119 | |
| | |
Bristol-Myers Squibb Co. | | | 13,386 | | | | 689,781 | |
| | |
Chugai Pharmaceutical Co. Ltd. | | | 2,300 | | | | 67,734 | |
| | |
Daiichi Sankyo Co. Ltd. | | | 6,900 | | | | 175,775 | |
| | |
Dechra Pharmaceuticals plc | | | 621 | | | | 28,695 | |
| | |
Eisai Co. Ltd. | | | 1,300 | | | | 68,337 | |
| | |
Eli Lilly & Co. | | | 2,714 | | | | 1,503,366 | |
| | |
GSK plc | | | 18,584 | | | | 328,655 | |
| | |
Hikma Pharmaceuticals plc | | | 828 | | | | 19,105 | |
| | |
Ipsen SA | | | 115 | | | | 13,553 | |
| | |
Merck & Co., Inc. | | | 16,468 | | | | 1,691,264 | |
| | |
Merck KGaA | | | 736 | | | | 110,741 | |
| | |
Novartis AG (Registered) | | | 11,086 | | | | 1,029,845 | |
| | |
Novo Nordisk A/S, Class B | | | 13,938 | | | | 1,336,292 | |
| | |
Ono Pharmaceutical Co. Ltd. | | | 2,300 | | | | 39,509 | |
| | |
Orion OYJ, Class B | | | 782 | | | | 31,030 | |
| | |
Pfizer, Inc. | | | 27,554 | | | | 842,050 | |
| | |
Roche Holding AG | | | 3,036 | | | | 780,142 | |
| | |
Sanofi SA | | | 7,038 | | | | 637,537 | |
| | |
Santen Pharmaceutical Co. Ltd. | | | 2,300 | | | | 19,857 | |
| | |
Shionogi & Co. Ltd. | | | 3,400 | | | | 156,861 | |
| | |
Takeda Pharmaceutical Co. Ltd. | | | 6,300 | | | | 169,018 | |
| | |
UCB SA | | | 414 | | | | 30,220 | |
| | |
Zoetis, Inc., Class A | | | 2,300 | | | | 361,100 | |
| | | | | | | 11,430,718 | |
|
Professional Services – 0.8% | |
| | |
Adecco Group AG (Registered) | | | 1,012 | | | | 38,076 | |
| | |
ALS Ltd. | | | 2,392 | | | | 16,251 | |
| | |
Arcadis NV | | | 506 | | | | 21,351 | |
| | |
Automatic Data Processing, Inc. | | | 1,334 | | | | 291,105 | |
| | |
Bureau Veritas SA | | | 1,380 | | | | 31,347 | |
See Accompanying Notes to the Financial Statements.
| | | | |
296 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Professional Services – (continued) | |
| | |
Computershare Ltd. | | | 3,772 | | | $ | 59,205 | |
| | |
DKSH Holding AG | | | 138 | | | | 8,446 | |
| | |
Experian plc | | | 1,518 | | | | 45,885 | |
| | |
Intertek Group plc | | | 1,012 | | | | 46,947 | |
| | |
Randstad NV | | | 552 | | | | 28,496 | |
| | |
RELX plc | | | 10,994 | | | | 382,610 | |
| | |
SGS SA (Registered) | | | 1,012 | | | | 82,268 | |
| | |
Teleperformance SE | | | 322 | | | | 36,809 | |
| | |
Verisk Analytics, Inc., Class A | | | 690 | | | | 156,878 | |
| | | | | | | 1,245,674 | |
|
Real Estate Management & Development – 0.5% | |
| | |
Castellum AB | | | 736 | | | | 7,019 | |
| | |
CBRE Group, Inc., Class A* (a) | | | 2,392 | | | | 165,861 | |
| | |
City Developments Ltd. | | | 4,600 | | | | 21,220 | |
| | |
CK Asset Holdings Ltd. | | | 11,500 | | | | 57,466 | |
| | |
Daiwa House Industry Co. Ltd. | | | 4,600 | | | | 125,354 | |
| | |
Fabege AB | | | 2,300 | | | | 17,099 | |
| | |
Hongkong Land Holdings Ltd. | | | 9,200 | | | | 29,164 | |
| | |
Kojamo OYJ | | | 1,012 | | | | 8,622 | |
| | |
Mitsubishi Estate Co. Ltd. | | | 4,600 | | | | 58,136 | |
| | |
Mitsui Fudosan Co. Ltd. | | �� | 2,300 | | | | 49,312 | |
| | |
Sagax AB, Class B(a) | | | 552 | | | | 9,955 | |
| | |
Sun Hung Kai Properties Ltd. | | | 6,000 | | | | 61,613 | |
| | |
Swiss Prime Site AG (Registered) | | | 690 | | | | 63,992 | |
| | |
Tokyu Fudosan Holdings Corp. | | | 4,600 | | | | 26,480 | |
| | |
Vonovia SE | | | 4,600 | | | | 105,510 | |
| | |
Wihlborgs Fastigheter AB | | | 2,346 | | | | 15,150 | |
| | | | | | | 821,953 | |
|
Residential REITs – 0.1% | |
| | |
Camden Property Trust, REIT(a) | | | 460 | | | | 39,045 | |
| | |
Equity Residential, REIT | | | 1,196 | | | | 66,175 | |
| | |
Essex Property Trust, Inc., REIT(a) | | | 322 | | | | 68,882 | |
| | | | | | | 174,102 | |
|
Retail REITs – 0.2% | |
| | |
CapitaLand Integrated Commercial Trust, REIT | | | 27,600 | | | | 35,456 | |
| | |
Klepierre SA, REIT | | | 644 | | | | 15,588 | |
| | |
Link REIT, REIT | | | 9,200 | | | | 42,210 | |
| | |
Region RE Ltd., REIT | | | 12,512 | | | | 15,567 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Retail REITs – (continued) | |
| | |
Simon Property Group, Inc., REIT | | | 1,012 | | | $ | 111,209 | |
| | |
Unibail – Rodamco-Westfield, REIT* | | | 322 | | | | 15,881 | |
| | |
Vicinity Ltd., REIT | | | 36,662 | | | | 39,461 | |
| | | | | | | 275,372 | |
|
Semiconductors & Semiconductor Equipment – 4.4% | |
| | |
Advanced Micro Devices, Inc.* | | | 5,152 | | | | 507,472 | |
| | |
Advantest Corp. | | | 2,400 | | | | 60,457 | |
| | |
AIXTRON SE | | | 253 | | | | 7,076 | |
| | |
ams-OSRAM AG* (a) | | | 1,794 | | | | 6,365 | |
| | |
Applied Materials, Inc. | | | 5,428 | | | | 718,396 | |
| | |
ASM International NV | | | 276 | | | | 113,338 | |
| | |
ASML Holding NV | | | 1,702 | | | | 1,016,983 | |
| | |
BE Semiconductor Industries NV | | | 529 | | | | 54,405 | |
| | |
Infineon Technologies AG | | | 5,474 | | | | 158,971 | |
| | |
Intel Corp. | | | 27,140 | | | | 990,610 | |
| | |
KLA Corp. | | | 460 | | | | 216,062 | |
| | |
Lam Research Corp. | | | 644 | | | | 378,814 | |
| | |
Microchip Technology, Inc.(a) | | | 1,794 | | | | 127,894 | |
| | |
Micron Technology, Inc. | | | 8,832 | | | | 590,596 | |
| | |
Nordic Semiconductor ASA* | | | 736 | | | | 5,940 | |
| | |
QUALCOMM, Inc. | | | 3,680 | | | | 401,083 | |
| | |
Renesas Electronics Corp.* | | | 11,500 | | | | 148,491 | |
| | |
Rohm Co. Ltd. | | | 2,400 | | | | 37,812 | |
| | |
SOITEC* | | | 161 | | | | 23,910 | |
| | |
STMicroelectronics NV(a) | | | 3,680 | | | | 139,915 | |
| | |
SUMCO Corp. | | | 2,300 | | | | 29,387 | |
| | |
Texas Instruments, Inc. | | | 4,508 | | | | 640,181 | |
| | |
Tokyo Electron Ltd. | | | 2,300 | | | | 300,020 | |
| | | | | | | 6,674,178 | |
|
Software – 9.5% | |
| | |
Adobe, Inc.* | | | 2,944 | | | | 1,566,385 | |
| | |
Autodesk, Inc.* | | | 1,748 | | | | 345,457 | |
| | |
Crowdstrike Holdings, Inc., Class A* (a) | | | 1,472 | | | | 260,205 | |
| | |
Dassault Systemes SE | | | 2,944 | | | | 120,785 | |
| | |
DocuSign, Inc., Class A* | | | 1,104 | | | | 42,924 | |
| | |
Gen Digital, Inc. | | | 4,922 | | | | 82,001 | |
| | |
HubSpot, Inc.* | | | 322 | | | | 136,454 | |
| | |
Intuit, Inc. | | | 1,380 | | | | 683,031 | |
| | |
Microsoft Corp. | | | 24,058 | | | | 8,134,250 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 297 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – (continued) | |
| | |
Oracle Corp. | | | 5,060 | | | $ | 523,204 | |
| | |
Palo Alto Networks, Inc.* | | | 1,518 | | | | 368,904 | |
| | |
Sage Group plc (The) | | | 6,026 | | | | 70,973 | |
| | |
Salesforce, Inc.* | | | 3,128 | | | | 628,196 | |
| | |
SAP SE | | | 5,382 | | | | 720,995 | |
| | |
Splunk, Inc.* | | | 736 | | | | 108,310 | |
| | |
Synopsys, Inc.* | | | 736 | | | | 345,508 | |
| | |
Temenos AG (Registered) | | | 230 | | | | 16,463 | |
| | |
WiseTech Global Ltd. | | | 1,242 | | | | 45,735 | |
| | |
Workday, Inc., Class A* | | | 690 | | | | 146,080 | |
| | | | | | | 14,345,860 | |
|
Specialized REITs – 0.5% | |
| | |
American Tower Corp., REIT(a) | | | 2,346 | | | | 418,034 | |
| | |
Big Yellow Group plc, REIT | | | 874 | | | | 10,128 | |
| | |
Digital Realty Trust, Inc., REIT | | | 966 | | | | 120,132 | |
| | |
Iron Mountain, Inc., REIT(a) | | | 1,426 | | | | 84,234 | |
| | |
Keppel DC REIT, REIT | | | 2,300 | | | | 2,837 | |
| | |
Safestore Holdings plc, REIT | | | 230 | | | | 1,908 | |
| | |
Weyerhaeuser Co., REIT | | | 4,692 | | | | 134,613 | |
| | | | | | | 771,886 | |
|
Specialty Retail – 1.2% | |
| | |
Best Buy Co., Inc. | | | 1,196 | | | | 79,917 | |
| | |
Burlington Stores, Inc.* | | | 230 | | | | 27,837 | |
| | |
H & M Hennes & Mauritz AB, Class B | | | 2,668 | | | | 35,652 | |
| | |
JB Hi-Fi Ltd. | | | 874 | | | | 24,996 | |
| | |
Kingfisher plc | | | 11,270 | | | | 28,691 | |
| | |
Lowe’s Cos., Inc. | | | 2,852 | | | | 543,506 | |
| | |
Nitori Holdings Co. Ltd. | | | 600 | | | | 65,014 | |
| | |
Ross Stores, Inc. | | | 2,254 | | | | 261,396 | |
| | |
TJX Cos., Inc. (The) | | | 5,842 | | | | 514,505 | |
| | |
Tractor Supply Co. | | | 552 | | | | 106,293 | |
| | |
Watches of Switzerland Group plc* (d) | | | 1,472 | | | | 8,949 | |
| | |
Williams-Sonoma, Inc.(a) | | | 644 | | | | 96,754 | |
| | |
Zalando SE* (b) | | | 414 | | | | 9,623 | |
| | | | | | | 1,803,133 | |
|
Technology Hardware, Storage & Peripherals – 5.6% | |
| | |
Apple, Inc. | | | 44,666 | | | | 7,627,613 | |
| | |
Brother Industries Ltd. | | | 2,300 | | | | 35,522 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Technology Hardware, Storage & Peripherals – (continued) | |
| | |
FUJIFILM Holdings Corp. | | | 3,600 | | | $ | 194,994 | |
| | |
Hewlett Packard Enterprise Co. | | | 8,004 | | | | 123,101 | |
| | |
HP, Inc. | | | 5,796 | | | | 152,609 | |
| | |
Konica Minolta, Inc.* | | | 4,600 | | | | 12,745 | |
| | |
Logitech International SA (Registered) | | | 644 | | | | 50,357 | |
| | |
NetApp, Inc. | | | 1,058 | | | | 77,001 | |
| | |
Ricoh Co. Ltd. | | | 2,300 | | | | 18,414 | |
| | |
Seiko Epson Corp. | | | 2,300 | | | | 31,536 | |
| | |
Western Digital Corp.* | | | 2,622 | | | | 105,273 | |
| | | | | | | 8,429,165 | |
|
Textiles, Apparel & Luxury Goods – 2.0% | |
| | |
adidas AG | | | 368 | | | | 65,037 | |
| | |
Asics Corp. | | | 2,300 | | | | 71,819 | |
| | |
Burberry Group plc | | | 2,162 | | | | 44,389 | |
| | |
Christian Dior SE | | | 23 | | | | 15,851 | |
| | |
Deckers Outdoor Corp.* | | | 138 | | | | 82,394 | |
| | |
Hermes International SCA | | | 138 | | | | 256,666 | |
| | |
HUGO BOSS AG | | | 391 | | | | 22,772 | |
| | |
Kering SA | | | 414 | | | | 167,688 | |
| | |
Lululemon Athletica, Inc.* (a) | | | 966 | | | | 380,102 | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 1,564 | | | | 1,115,048 | |
| | |
Moncler SpA | | | 1,242 | | | | 64,248 | |
| | |
NIKE, Inc., Class B | | | 6,026 | | | | 619,292 | |
| | |
Pandora A/S | | | 506 | | | | 57,197 | |
| | |
Puma SE | | | 598 | | | | 33,690 | |
| | |
Shenzhou International Group Holdings Ltd. | | | 4,600 | | | | 45,121 | |
| | |
Swatch Group AG (The) | | | 207 | | | | 52,816 | |
| | | | | | | 3,094,130 | |
|
Trading Companies & Distributors – 1.0% | |
| | |
Ashtead Group plc | | | 2,622 | | | | 149,665 | |
| | |
Beijer Ref AB, Class B(a) | | | 1,656 | | | | 15,667 | |
| | |
Bunzl plc | | | 736 | | | | 26,186 | |
| | |
Diploma plc | | | 805 | | | | 27,761 | |
| | |
Ferguson plc | | | 1,978 | | | | 297,096 | |
| | |
Grafton Group plc | | | 1,150 | | | | 10,760 | |
| | |
IMCD NV | | | 184 | | | | 22,074 | |
| | |
ITOCHU Corp.(a) | | | 6,900 | | | | 244,800 | |
| | |
Mitsui & Co. Ltd. | | | 9,200 | | | | 329,073 | |
See Accompanying Notes to the Financial Statements.
| | | | |
298 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Trading Companies & Distributors – (continued) | |
| | |
Rexel SA | | | 1,219 | | | $ | 24,784 | |
| | |
RS GROUP plc | | | 2,070 | | | | 17,010 | |
| | |
Sojitz Corp. | | | 1,599 | | | | 32,794 | |
| | |
Sumitomo Corp. | | | 6,900 | | | | 133,881 | |
| | |
Toyota Tsusho Corp. | | | 1,800 | | | | 93,967 | |
| | |
Travis Perkins plc | | | 2,070 | | | | 18,578 | |
| | | | | | | 1,444,096 | |
|
Transportation Infrastructure – 0.2% | |
| | |
Aena SME SA(b) | | | 276 | | | | 39,894 | |
| | |
Aeroports de Paris SA | | | 92 | | | | 10,288 | |
| | |
Auckland International Airport Ltd. | | | 5,553 | | | | 23,707 | |
| | |
Flughafen Zurich AG (Registered) | | | 46 | | | | 8,553 | |
| | |
Getlink SE | | | 2,047 | | | | 32,964 | |
| | |
Qube Holdings Ltd.(a) | | | 10,166 | | | | 17,121 | |
| | |
SATS Ltd.* | | | 4,600 | | | | 8,260 | |
| | |
Transurban Group | | | 13,294 | | | | 99,490 | |
| | | | | | | 240,277 | |
|
Water Utilities – 0.1% | |
| | |
American Water Works Co., Inc. | | | 1,012 | | | | 119,062 | |
| | |
Pennon Group plc | | | 3,128 | | | | 27,575 | |
| | |
Severn Trent plc | | | 1,702 | | | | 54,854 | |
| | |
United Utilities Group plc | | | 1,794 | | | | 23,141 | |
| | | | | | | 224,632 | |
|
Wireless Telecommunication Services – 0.1% | |
| | |
Millicom International Cellular SA, SDR* | | | 414 | | | | 6,485 | |
| | |
Tele2 AB, Class B | | | 1,978 | | | | 14,011 | |
| | |
Vodafone Group plc | | | 135,838 | | | | 124,778 | |
| | | | | | | 145,274 | |
Total Common Stocks (Cost $125,624,190) | | | | 150,048,123 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 0.6%(e) | |
|
REPURCHASE AGREEMENTS – 0.6% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $857,630, collateralized by various U.S. Treasury Securities, ranging from 1.50% –3.88%, maturing 2/15/2025 –1/31/2027; total market value $867,255 (Cost $857,504) | | $ | 857,504 | | | $ | 857,504 | |
Total Investments – 99.4% (Cost $126,481,694) | | | | 150,905,627 | |
| |
Other assets less liabilities – 0.6% | | | | 909,993 | |
NET ASSETS – 100.0% | | | | 151,815,620 | |
* | Non-income producing security. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $6,708,462, collateralized in the form of cash with a value of $857,504 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $4,674,253 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $1,463,495 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $6,995,252. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | Represents less than 0.05% of net assets. |
(d) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(e) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $857,504. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
CVA – Dutch Certification
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 299 | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
OYJ – Public Limited Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA – Limited partnership with share capital
SDR – Swedish Depositary Receipt
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 30,165,476 | |
Aggregate gross unrealized depreciation | | | (5,984,946 | ) |
Net unrealized appreciation | | $ | 24,180,530 | |
Federal income tax cost | | $ | 126,642,744 | |
Futures Contracts
FlexShares® STOXX® Global ESG Select Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
MSCI EAFE E-Mini Index | | | 7 | | | | 12/15/2023 | | | | USD | | | $ | 690,935 | | | $ | (31,638 | ) |
S&P 500 E-Mini Index | | | 5 | | | | 12/15/2023 | | | | USD | | | | 1,053,063 | | | | (58,471 | ) |
| | | | | | | | | | | | | | | | | | $ | (90,109 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® STOXX® Global ESG Select Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | | | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 144,141 | | | | | UBS AG | | | CHF | | | | 127,546 | | | | 12/20/2023 | | | $ | 3,196 | |
USD | | | 62,260 | | | | | Toronto-Dominion Bank (The) | | | GBP | | | | 50,000 | | | | 12/20/2023 | | | | 1,563 | |
USD | | | 169,462 | | | | | Citibank NA | | | JPY | | | | 25,000,000 | | | | 12/20/2023 | | | | 2,997 | |
Net unrealized appreciation | | | | | | | $ | 7,756 | |
Abbreviations:
CHF – Swiss Franc
GBP – British Pound
JPY – Japanese Yen
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | |
300 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global ESG Select Index Fund (cont.)
FlexShares® STOXX® Global ESG Select Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 3.9 | % |
Austria | | | 0.1 | |
Belgium | | | 0.3 | |
Canada | | | 2.0 | |
Denmark | | | 1.4 | |
Finland | | | 0.5 | |
France | | | 5.1 | |
Germany | | | 2.6 | |
Hong Kong | | | 0.5 | |
Ireland | | | 0.1 | |
Italy | | | 1.4 | |
Japan | | | 7.8 | |
Luxembourg | | | 0.0 | † |
Netherlands | | | 2.4 | |
New Zealand | | | 0.1 | |
Norway | | | 0.3 | |
Poland | | | 0.0 | † |
Portugal | | | 0.1 | |
Singapore | | | 0.4 | |
Spain | | | 1.0 | |
Sweden | | | 1.1 | |
Switzerland | | | 2.8 | |
United Kingdom | | | 5.7 | |
United States | | | 59.2 | |
Other1 | | | 1.2 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.8 | % |
Securities Lending Reinvestments | | | 0.6 | |
Others(1) | | | 0.6 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 301 | |
Schedule of Investments
FlexShares® ESG & Climate US Large Cap Core Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.2% | |
|
Aerospace & Defense – 0.2% | |
| | |
Axon Enterprise, Inc.* | | | 341 | | | $ | 69,731 | |
|
Air Freight & Logistics – 0.1% | |
| | |
United Parcel Service, Inc., Class B | | | 341 | | | | 48,166 | |
|
Automobiles – 2.2% | |
| | |
Tesla, Inc.* | | | 3,968 | | | | 796,933 | |
|
Banks – 3.2% | |
| | |
Bank of America Corp. | | | 14,043 | | | | 369,893 | |
| | |
Citigroup, Inc. | | | 7,006 | | | | 276,667 | |
| | |
Fifth Third Bancorp | | | 806 | | | | 19,110 | |
| | |
JPMorgan Chase & Co. | | | 3,751 | | | | 521,614 | |
| | | | | | | 1,187,284 | |
|
Beverages – 1.3% | |
| | |
Coca-Cola Co. (The) | | | 775 | | | | 43,780 | |
| | |
PepsiCo, Inc. | | | 2,759 | | | | 450,489 | |
| | | | | | | 494,269 | |
|
Biotechnology – 3.0% | |
| | |
AbbVie, Inc. | | | 2,542 | | | | 358,880 | |
| | |
Amgen, Inc. | | | 1,488 | | | | 380,482 | |
| | |
Biogen, Inc.* | | | 713 | | | | 169,366 | |
| | |
Regeneron Pharmaceuticals, Inc.* | | | 217 | | | | 169,236 | |
| | |
Vertex Pharmaceuticals, Inc.* | | | 31 | | | | 11,225 | |
| | | | | | | 1,089,189 | |
|
Broadline Retail – 3.8% | |
| | |
Amazon.com, Inc.* | | | 9,579 | | | | 1,274,869 | |
| | |
eBay, Inc. | | | 2,604 | | | | 102,155 | |
| | |
Etsy, Inc.* | | | 620 | | | | 38,626 | |
| | | | | | | 1,415,650 | |
|
Building Products – 1.1% | |
| | |
Johnson Controls International plc | | | 3,162 | | | | 155,001 | |
| | |
Owens Corning | | | 465 | | | | 52,717 | |
| | |
Trane Technologies plc | | | 1,116 | | | | 212,386 | |
| | | | | | | 420,104 | |
|
Capital Markets – 3.4% | |
| | |
BlackRock, Inc. | | | 31 | | | | 18,981 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
Goldman Sachs Group, Inc. (The) | | | 465 | | | $ | 141,179 | |
| | |
Moody’s Corp. | | | 806 | | | | 248,248 | |
| | |
Morgan Stanley | | | 3,751 | | | | 265,646 | |
| | |
MSCI, Inc., Class A | | | 403 | | | | 190,034 | |
| | |
Nasdaq, Inc. | | | 186 | | | | 9,225 | |
| | |
S&P Global, Inc. | | | 1,054 | | | | 368,173 | |
| | | | | | | 1,241,486 | |
|
Chemicals – 1.3% | |
| | |
Ecolab, Inc. | | | 1,271 | | | | 213,198 | |
| | |
International Flavors & Fragrances, Inc. | | | 1,209 | | | | 82,635 | |
| | |
PPG Industries, Inc. | | | 1,178 | | | | 144,623 | |
| | |
Sherwin-Williams Co. (The) | | | 93 | | | | 22,153 | |
| | | | | | | 462,609 | |
|
Commercial Services & Supplies – 1.4% | |
| | |
Cintas Corp. | | | 434 | | | | 220,090 | |
| | |
Waste Management, Inc. | | | 1,767 | | | | 290,371 | |
| | | | | | | 510,461 | |
|
Communications Equipment – 0.8% | |
| | |
Cisco Systems, Inc. | | | 5,394 | | | | 281,189 | |
|
Construction & Engineering – 0.1% | |
| | |
AECOM | | | 651 | | | | 49,834 | |
|
Consumer Finance – 0.1% | |
| | |
American Express Co. | | | 248 | | | | 36,215 | |
|
Consumer Staples Distribution & Retail – 1.9% | |
| | |
Kroger Co. (The) | | | 3,348 | | | | 151,899 | |
| | |
Sysco Corp. | | | 2,542 | | | | 169,017 | |
| | |
Target Corp. | | | 1,116 | | | | 123,642 | |
| | |
Walgreens Boots Alliance, Inc. | | | 3,472 | | | | 73,190 | |
| | |
Walmart, Inc. | | | 1,116 | | | | 182,365 | |
| | | | | | | 700,113 | |
|
Containers & Packaging – 0.2% | |
| | |
Avery Dennison Corp. | | | 403 | | | | 70,150 | |
| | |
Ball Corp. | | | 279 | | | | 13,434 | |
| | | | | | | 83,584 | |
See Accompanying Notes to the Financial Statements.
| | | | |
302 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate US Large Cap Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Diversified Telecommunication Services – 1.5% | |
| | |
AT&T, Inc. | | | 19,716 | | | $ | 303,626 | |
| | |
Verizon Communications, Inc. | | | 6,820 | | | | 239,587 | |
| | | | | | | 543,213 | |
|
Electric Utilities – 1.1% | |
| | |
Constellation Energy Corp. | | | 217 | | | | 24,504 | |
| | |
Edison International | | | 837 | | | | 52,781 | |
| | |
Eversource Energy | | | 1,674 | | | | 90,044 | |
| | |
Exelon Corp. | | | 4,898 | | | | 190,728 | |
| | |
NextEra Energy, Inc. | | | 682 | | | | 39,761 | |
| | | | | | | 397,818 | |
|
Electrical Equipment – 0.2% | |
| | |
Rockwell Automation, Inc. | | | 248 | | | | 65,177 | |
|
Energy Equipment & Services – 0.8% | |
| | |
Baker Hughes Co., Class A | | | 2,852 | | | | 98,166 | |
| | |
Schlumberger NV | | | 3,534 | | | | 196,702 | |
| | | | | | | 294,868 | |
|
Entertainment – 0.9% | |
| | |
Spotify Technology SA* | | | 403 | | | | 66,398 | |
| | |
Walt Disney Co. (The)* | | | 3,069 | | | | 250,400 | |
| | | | | | | 316,798 | |
|
Financial Services – 4.2% | |
| | |
Berkshire Hathaway, Inc., Class B* | | | 744 | | | | 253,950 | |
| | |
Mastercard, Inc., Class A | | | 1,550 | | | | 583,342 | |
| | |
PayPal Holdings, Inc.* | | | 1,798 | | | | 93,136 | |
| | |
Visa, Inc., Class A | | | 2,666 | | | | 626,777 | |
| | | | | | | 1,557,205 | |
|
Food Products – 0.3% | |
| | |
General Mills, Inc. | | | 527 | | | | 34,382 | |
| | |
Mondelez International, Inc., Class A | | | 1,054 | | | | 69,785 | |
| | | | | | | 104,167 | |
|
Ground Transportation – 1.7% | |
| | |
CSX Corp. | | | 9,889 | | | | 295,187 | |
| | |
Norfolk Southern Corp. | | | 1,116 | | | | 212,922 | |
| | |
Union Pacific Corp. | | | 558 | | | | 115,846 | |
| | | | | | | 623,955 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Equipment & Supplies – 1.7% | |
| | |
Abbott Laboratories | | | 2,511 | | | $ | 237,415 | |
| | |
Boston Scientific Corp.* | | | 2,604 | | | | 133,299 | |
| | |
Edwards Lifesciences Corp.* | | | 713 | | | | 45,433 | |
| | |
Medtronic plc | | | 3,131 | | | | 220,923 | |
| | | | | | | 637,070 | |
|
Health Care Providers & Services – 3.3% | |
| | |
Cencora, Inc. | | | 496 | | | | 91,834 | |
| | |
Cigna Group (The) | | | 1,333 | | | | 412,164 | |
| | |
CVS Health Corp. | | | 3,689 | | | | 254,578 | |
| | |
Elevance Health, Inc. | | | 868 | | | | 390,678 | |
| | |
UnitedHealth Group, Inc. | | | 155 | | | | 83,012 | |
| | | | | | | 1,232,266 | |
|
Hotel & Resort REITs – 0.1% | |
| | |
Host Hotels & Resorts, Inc., REIT | | | 3,441 | | | | 53,267 | |
|
Hotels, Restaurants & Leisure – 1.4% | |
| | |
Airbnb, Inc., Class A* | | | 186 | | | | 22,002 | |
| | |
Booking Holdings, Inc.* | | | 45 | | | | 125,530 | |
| | |
Caesars Entertainment, Inc.* | | | 1,023 | | | | 40,807 | |
| | |
Las Vegas Sands Corp. | | | 1,674 | | | | 79,448 | |
| | |
McDonald’s Corp. | | | 744 | | | | 195,055 | |
| | |
MGM Resorts International | | | 1,426 | | | | 49,796 | |
| | | | | | | 512,638 | |
|
Household Products – 2.0% | |
| | |
Church & Dwight Co., Inc. | | | 124 | | | | 11,277 | |
| | |
Clorox Co. (The) | | | 620 | | | | 72,974 | |
| | |
Colgate-Palmolive Co. | | | 2,728 | | | | 204,927 | |
| | |
Kimberly-Clark Corp. | | | 1,147 | | | | 137,227 | |
| | |
Procter & Gamble Co. (The) | | | 2,046 | | | | 306,961 | |
| | | | | | | 733,366 | |
|
Industrial Conglomerates – 0.2% | |
| | |
3M Co. | | | 682 | | | | 62,028 | |
|
Industrial REITs – 0.9% | |
| | |
Prologis, Inc., REIT | | | 3,224 | | | | 324,818 | |
|
Insurance – 1.7% | |
| | |
Chubb Ltd. | | | 992 | | | | 212,903 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | 1,519 | | | | 111,571 | |
| | |
Marsh & McLennan Cos., Inc. | | | 217 | | | | 41,154 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 303 | |
FlexShares® ESG & Climate US Large Cap Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
MetLife, Inc. | | | 3,224 | | | $ | 193,472 | |
| | |
Principal Financial Group, Inc. | | | 155 | | | | 10,490 | |
| | |
Travelers Cos., Inc. (The) | | | 248 | | | | 41,525 | |
| | | | | | | 611,115 | |
|
Interactive Media & Services – 6.3% | |
| | |
Alphabet, Inc., Class A* | | | 7,502 | | | | 930,848 | |
| | |
Alphabet, Inc., Class C* | | | 7,254 | | | | 908,926 | |
| | |
Meta Platforms, Inc., Class A* | | | 1,550 | | | | 466,969 | |
| | | | | | | 2,306,743 | |
|
IT Services – 1.8% | |
| | |
Accenture plc, Class A | | | 558 | | | | 165,776 | |
| | |
Akamai Technologies, Inc.* | | | 744 | | | | 76,878 | |
| | |
International Business Machines Corp. | | | 2,945 | | | | 425,965 | |
| | | | | | | 668,619 | |
|
Life Sciences Tools & Services – 0.7% | |
| | |
Agilent Technologies, Inc. | | | 186 | | | | 19,227 | |
| | |
Charles River Laboratories International, Inc.* | | | 248 | | | | 41,753 | |
| | |
Illumina, Inc.* | | | 775 | | | | 84,800 | |
| | |
Mettler-Toledo International, Inc.* | | | 93 | | | | 91,624 | |
| | |
Thermo Fisher Scientific, Inc. | | | 62 | | | | 27,576 | |
| | | | | | | 264,980 | |
|
Machinery – 1.7% | |
| | |
CNH Industrial NV | | | 4,712 | | | | 51,738 | |
| | |
Cummins, Inc. | | | 682 | | | | 147,517 | |
| | |
Deere & Co. | | | 558 | | | | 203,871 | |
| | |
Stanley Black & Decker, Inc. | | | 744 | | | | 63,277 | |
| | |
Westinghouse Air Brake Technologies Corp. | | | 868 | | | | 92,025 | |
| | |
Xylem, Inc. | | | 899 | | | | 84,092 | |
| | | | | | | 642,520 | |
|
Media – 0.6% | |
| | |
Comcast Corp., Class A | | | 3,596 | | | | 148,479 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | 1,922 | | | | 54,585 | |
| | | | | | | 203,064 | |
|
Metals & Mining – 0.8% | |
| | |
Newmont Corp. | | | 5,615 | | | | 210,394 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Nucor Corp. | | | 93 | | | $ | 13,745 | |
| | |
Steel Dynamics, Inc. | | | 806 | | | | 85,847 | |
| | | | | | | 309,986 | |
|
Multi-Utilities – 1.0% | |
| | |
Consolidated Edison, Inc. | | | 1,705 | | | | 149,682 | |
| | |
Sempra | | | 3,038 | | | | 212,751 | |
| | | | | | | 362,433 | |
|
Office REITs – 0.1% | |
| | |
Boston Properties, Inc., REIT | | | 713 | | | | 38,195 | |
|
Oil, Gas & Consumable Fuels – 3.4% | |
| | |
Cheniere Energy, Inc. | | | 992 | | | | 165,089 | |
| | |
EQT Corp. | | | 1,798 | | | | 76,199 | |
| | |
Exxon Mobil Corp. | | | 434 | | | | 45,939 | |
| | |
Hess Corp. | | | 806 | | | | 116,386 | |
| | |
Marathon Petroleum Corp. | | | 1,984 | | | | 300,080 | |
| | |
ONEOK, Inc. | | | 124 | | | | 8,085 | |
| | |
Pioneer Natural Resources Co. | | | 496 | | | | 118,544 | |
| | |
Valero Energy Corp. | | | 1,674 | | | | 212,598 | |
| | |
Williams Cos., Inc. (The) | | | 6,014 | | | | 206,882 | |
| | | | | | | 1,249,802 | |
|
Personal Care Products – 0.4% | |
| | |
Estee Lauder Cos., Inc. (The), Class A | | | 1,147 | | | | 147,814 | |
| | |
Kenvue, Inc. | | | 961 | | | | 17,875 | |
| | | | | | | 165,689 | |
|
Pharmaceuticals – 4.4% | |
| | |
Bristol-Myers Squibb Co. | | | 2,914 | | | | 150,158 | |
| | |
Eli Lilly & Co. | | | 124 | | | | 68,687 | |
| | |
Johnson & Johnson | | | 4,216 | | | | 625,402 | |
| | |
Merck & Co., Inc. | | | 5,146 | | | | 528,494 | |
| | |
Pfizer, Inc. | | | 8,649 | | | | 264,314 | |
| | | | | | | 1,637,055 | |
|
Professional Services – 1.4% | |
| | |
Automatic Data Processing, Inc. | | | 1,550 | | | | 338,241 | |
| | |
Paychex, Inc. | | | 1,581 | | | | 175,570 | |
| | | | | | | 513,811 | |
|
Semiconductors & Semiconductor Equipment – 6.2% | |
| | |
Advanced Micro Devices, Inc.* | | | 62 | | | | 6,107 | |
| | |
Applied Materials, Inc. | | | 2,077 | | | | 274,891 | |
See Accompanying Notes to the Financial Statements.
| | | | |
304 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate US Large Cap Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Enphase Energy, Inc.* | | | 651 | | | $ | 51,807 | |
| | |
First Solar, Inc.* | | | 496 | | | | 70,655 | |
| | |
Intel Corp. | | | 12,958 | | | | 472,967 | |
| | |
NVIDIA Corp. | | | 3,100 | | | | 1,264,180 | |
| | |
QUALCOMM, Inc. | | | 620 | | | | 67,574 | |
| | |
SolarEdge Technologies, Inc.* | | | 279 | | | | 21,190 | |
| | |
Texas Instruments, Inc. | | | 527 | | | | 74,839 | |
| | | | | | | 2,304,210 | |
|
Software – 11.5% | |
| | |
Adobe, Inc.* | | | 1,023 | | | | 544,297 | |
| | |
Autodesk, Inc.* | | | 558 | | | | 110,278 | |
| | |
Cadence Design Systems, Inc.* | | | 93 | | | | 22,306 | |
| | |
Microsoft Corp. | | | 7,750 | | | | 2,620,353 | |
| | |
Salesforce, Inc.* | | | 2,356 | | | | 473,155 | |
| | |
ServiceNow, Inc.* | | | 155 | | | | 90,187 | |
| | |
VMware, Inc., Class A* | | | 1,110 | | | | 161,672 | |
| | |
Workday, Inc., Class A* | | | 1,023 | | | | 216,579 | |
| | | | | | | 4,238,827 | |
|
Specialized REITs – 1.2% | |
| | |
Equinix, Inc., REIT | | | 465 | | | | 339,282 | |
| | |
Weyerhaeuser Co., REIT | | | 3,565 | | | | 102,280 | |
| | | | | | | 441,562 | |
|
Specialty Retail – 2.2% | |
| | |
Best Buy Co., Inc. | | | 217 | | | | 14,500 | |
| | |
Home Depot, Inc. (The) | | | 651 | | | | 185,333 | |
| | |
Lowe’s Cos., Inc. | | | 682 | | | | 129,969 | |
| | |
TJX Cos., Inc. (The) | | | 4,402 | | | | 387,684 | |
| | |
Tractor Supply Co. | | | 558 | | | | 107,449 | |
| | | | | | | 824,935 | |
|
Technology Hardware, Storage & Peripherals – 8.2% | |
| | |
Apple, Inc. | | | 15,903 | | | | 2,715,755 | |
| | |
Dell Technologies, Inc., Class C | | | 1,271 | | | | 85,043 | |
| | |
Hewlett Packard Enterprise Co. | | | 6,417 | | | | 98,694 | |
| | |
HP, Inc. | | | 4,371 | | | | 115,088 | |
| | |
NetApp, Inc. | | | 248 | | | | 18,049 | |
| | | | | | | 3,032,629 | |
|
Textiles, Apparel & Luxury Goods – 1.1% | |
| | |
NIKE, Inc., Class B | | | 3,937 | | | | 404,605 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Trading Companies & Distributors – 0.1% | |
| | |
WW Grainger, Inc. | | | 31 | | | $ | 22,625 | |
Total Common Stocks (Cost $36,507,265) | | | | 36,588,876 | |
| | Principal Amount | | | | |
|
SHORT-TERM INVESTMENTS – 0.0%(a) (b) (c) | |
|
U.S. TREASURY OBLIGATIONS – 0.0% | |
| | |
U.S. Treasury Bills 5.42%, 4/11/2024 (Cost $24,404) | | $ | 25,000 | | | | 24,403 | |
Total Investments – 99.2% (Cost $36,531,669) | | | | 36,613,279 | |
| |
Other assets less liabilities – 0.8% | | | | 282,607 | |
NET ASSETS – 100.0% | | | $ | 36,895,886 | |
* | Non-income producing security. |
(a) | Represents less than 0.05% of net assets. |
(b) | The rate shown was the current yield as of October 31, 2023. |
(c) | All or a portion of the security pledged as collateral for Futures Contracts. |
Percentages shown are based on Net Assets.
Abbreviations:
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 2,728,395 | |
Aggregate gross unrealized depreciation | | | (2,648,444 | ) |
Net unrealized appreciation | | $ | 79,951 | |
Federal income tax cost | | $ | 36,515,607 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 305 | |
FlexShares® ESG & Climate US Large Cap Core Index Fund (cont.)
Futures Contracts
FlexShares® ESG & Climate US Large Cap Core Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
S&P 500 Micro E-Mini Index | | | 18 | | | | 12/15/2023 | | | | USD | | | $ | 379,103 | | | $ | (17,721 | ) |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.2 | % |
Short-Term Investments | | | 0.0 | † |
Others(1) | | | 0.8 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
306 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.3% | |
|
Air Freight & Logistics – 0.9% | |
| | |
Deutsche Post AG | | | 8,838 | | | $ | 343,403 | |
|
Automobile Components – 0.4% | |
| | |
Bridgestone Corp. | | | 3,600 | | | | 134,710 | |
| | |
Sumitomo Electric Industries Ltd. | | | 1,800 | | | | 18,649 | |
| | | | | | | 153,359 | |
|
Automobiles – 2.4% | |
| | |
Bayerische Motoren Werke AG | | | 396 | | | | 36,679 | |
| | |
Honda Motor Co. Ltd. | | | 2,400 | | | | 23,874 | |
| | |
Mercedes-Benz Group AG | | | 2,520 | | | | 147,646 | |
| | |
Porsche Automobil Holding SE (Preference) | | | 1,638 | | | | 72,977 | |
| | |
Toyota Motor Corp. | | | 30,600 | | | | 523,319 | |
| | |
Yamaha Motor Co. Ltd. | | | 3,600 | | | | 86,455 | |
| | | | | | | 890,950 | |
|
Banks – 11.5% | |
| | |
ABN AMRO Bank NV, CVA(a) | | | 4,914 | | | | 65,887 | |
| | |
AIB Group plc | | | 17,586 | | | | 75,703 | |
| | |
ANZ Group Holdings Ltd. | | | 10,098 | | | | 157,984 | |
| | |
Banco Santander SA | | | 40,122 | | | | 146,989 | |
| | |
Bank of Montreal | | | 558 | | | | 42,120 | |
| | |
Bank of Nova Scotia (The) | | | 5,418 | | | | 219,140 | |
| | |
Barclays plc | | | 36,576 | | | | 58,408 | |
| | |
BNP Paribas SA | | | 6,894 | | | | 395,609 | |
| | |
Commonwealth Bank of Australia | | | 6,138 | | | | 375,259 | |
| | |
Credit Agricole SA | | | 3,852 | | | | 46,326 | |
| | |
Danske Bank A/S | | | 1,440 | | | | 33,699 | |
| | |
DBS Group Holdings Ltd. | | | 1,800 | | | | 43,159 | |
| | |
HSBC Holdings plc | | | 52,398 | | | | 376,598 | |
| | |
ING Groep NV | | | 16,488 | | | | 209,622 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | 43,200 | | | | 358,562 | |
| | |
Mizuho Financial Group, Inc. | | | 3,600 | | | | 60,509 | |
| | |
National Australia Bank Ltd. | | | 10,332 | | | | 183,495 | |
| | |
NatWest Group plc | | | 22,284 | | | | 48,186 | |
| | |
Nordea Bank Abp | | | 4,716 | | | | 49,513 | |
| | |
Resona Holdings, Inc. | | | 3,600 | | | | 19,100 | |
| | |
Royal Bank of Canada | | | 5,652 | | | | 450,939 | |
| | |
Societe Generale SA | | | 4,608 | | | | 102,990 | |
| | |
Standard Chartered plc | | | 4,770 | | | | 36,465 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Toronto-Dominion Bank (The) | | | 9,108 | | | $ | 508,198 | |
| | |
Westpac Banking Corp. | | | 19,530 | | | | 254,728 | |
| | | | | | | 4,319,188 | |
|
Beverages – 2.4% | |
| | |
Anheuser-Busch InBev SA/NV | | | 1,872 | | | | 106,118 | |
| | |
Asahi Group Holdings Ltd. | | | 1,800 | | | | 64,610 | |
| | |
Coca-Cola HBC AG | | | 2,682 | | | | 69,385 | |
| | |
Diageo plc | | | 12,780 | | | | 481,830 | |
| | |
Kirin Holdings Co. Ltd. | | | 5,400 | | | | 75,574 | |
| | |
Pernod Ricard SA | | | 522 | | | | 92,419 | |
| | | | | | | 889,936 | |
|
Biotechnology – 0.7% | |
| | |
CSL Ltd. | | | 1,548 | | | | 227,730 | |
| | |
Grifols SA* | | | 3,654 | | | | 40,882 | |
| | | | | | | 268,612 | |
|
Broadline Retail – 0.7% | |
| | |
Canadian Tire Corp. Ltd., Class A | | | 630 | | | | 60,701 | |
| | |
Next plc | | | 1,530 | | | | 127,807 | |
| | |
Rakuten Group, Inc. | | | 18,000 | | | | 66,179 | |
| | | | | | | 254,687 | |
|
Building Products – 1.2% | |
| | |
Cie de Saint-Gobain SA | | | 3,024 | | | | 164,293 | |
| | |
Daikin Industries Ltd. | | | 200 | | | | 28,565 | |
| | |
Geberit AG (Registered) | | | 252 | | | | 116,800 | |
| | |
Kingspan Group plc | | | 1,818 | | | | 121,985 | |
| | | | | | | 431,643 | |
|
Capital Markets – 2.5% | |
| | |
Daiwa Securities Group, Inc. | | | 10,800 | | | | 61,614 | |
| | |
Deutsche Boerse AG | | | 216 | | | | 35,434 | |
| | |
EQT AB | | | 4,212 | | | | 76,492 | |
| | |
Hong Kong Exchanges & Clearing Ltd. | | | 2,600 | | | | 91,379 | |
| | |
London Stock Exchange Group plc | | | 180 | | | | 18,085 | |
| | |
Macquarie Group Ltd. | | | 1,170 | | | | 119,252 | |
| | |
Nomura Holdings, Inc. | | | 32,400 | | | | 124,063 | |
| | |
Schroders plc | | | 7,506 | | | | 33,636 | |
| | |
St James’s Place plc | | | 5,328 | | | | 41,352 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 307 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – (continued) | |
| | |
UBS Group AG (Registered) | | | 14,382 | | | $ | 335,351 | |
| | | | | | | 936,658 | |
|
Chemicals – 3.3% | |
| | |
Akzo Nobel NV | | | 1,908 | | | | 127,580 | |
| | |
Arkema SA | | | 558 | | | | 52,127 | |
| | |
Chr Hansen Holding A/S | | | 1,296 | | | | 88,188 | |
| | |
Clariant AG (Registered) | | | 3,042 | | | | 43,020 | |
| | |
Covestro AG* (a) | | | 2,322 | | | | 117,073 | |
| | |
Croda International plc | | | 1,530 | | | | 81,281 | |
| | |
Givaudan SA (Registered) | | | 45 | | | | 149,332 | |
| | |
Mitsui Chemicals, Inc. | | | 1,800 | | | | 44,725 | |
| | |
Nissan Chemical Corp. | | | 1,000 | | | | 40,246 | |
| | |
Nitto Denko Corp. | | | 1,800 | | | | 115,087 | |
| | |
Novozymes A/S, Class B | | | 1,350 | | | | 60,528 | |
| | |
Nutrien Ltd. | | | 270 | | | | 14,486 | |
| | |
Sika AG (Registered) | | | 936 | | | | 223,085 | |
| | |
Sumitomo Chemical Co. Ltd. | | | 10,800 | | | | 27,242 | |
| | |
Symrise AG, Class A | | | 270 | | | | 27,454 | |
| | |
Umicore SA | | | 162 | | | | 3,844 | |
| | |
Wacker Chemie AG | | | 162 | | | | 19,778 | |
| | | | | | | 1,235,076 | |
|
Commercial Services & Supplies – 0.3% | |
| | |
Brambles Ltd. | | | 2,808 | | | | 23,308 | |
| | |
Dai Nippon Printing Co. Ltd. | | | 2,500 | | | | 64,528 | |
| | |
Secom Co. Ltd. | | | 400 | | | | 27,601 | |
| | | | | | | 115,437 | |
|
Communications Equipment – 0.2% | |
| | |
Nokia OYJ | | | 18,810 | | | | 62,430 | |
|
Construction & Engineering – 0.5% | |
| | |
Taisei Corp. | | | 1,800 | | | | 60,604 | |
| | |
WSP Global, Inc. | | | 828 | | | | 108,247 | |
| | | | | | | 168,851 | |
|
Consumer Staples Distribution & Retail – 2.3% | |
| | |
Aeon Co. Ltd. | | | 3,600 | | | | 75,283 | |
| | |
Carrefour SA | | | 6,048 | | | | 105,992 | |
| | |
Jeronimo Martins SGPS SA | | | 3,690 | | | | 84,949 | |
| | |
Loblaw Cos. Ltd. | | | 720 | | | | 58,824 | |
| | |
Tesco plc | | | 83,646 | | | | 273,746 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Woolworths Group Ltd. | | | 12,492 | | | $ | 278,566 | |
| | | | | | | 877,360 | |
|
Containers & Packaging – 0.6% | |
| | |
DS Smith plc | | | 5,256 | | | | 18,190 | |
| | |
SIG Group AG | | | 3,834 | | | | 84,217 | |
| | |
Smurfit Kappa Group plc | | | 3,114 | | | | 101,420 | |
| | | | | | | 203,827 | |
|
Diversified Consumer Services – 0.3% | |
| | |
Pearson plc | | | 8,370 | | | | 96,650 | |
|
Diversified REITs – 0.2% | |
| | |
GPT Group (The), REIT | | | 24,012 | | | | 55,036 | |
| | |
Land Securities Group plc, REIT | | | 4,374 | | | | 30,200 | |
| | | | | | | 85,236 | |
|
Diversified Telecommunication Services – 2.2% | |
| | |
BCE, Inc. | | | 2,736 | | | | 101,588 | |
| | |
Deutsche Telekom AG (Registered) | | | 13,608 | | | | 294,505 | |
| | |
Nippon Telegraph & Telephone Corp. | | | 75,600 | | | | 88,257 | |
| | |
Swisscom AG (Registered) | | | 306 | | | | 182,917 | |
| | |
Telefonica Deutschland Holding AG | | | 4,194 | | | | 7,108 | |
| | |
Telefonica SA | | | 7,254 | | | | 27,956 | |
| | |
Telia Co. AB | | | 738 | | | | 1,560 | |
| | |
TELUS Corp. | | | 6,318 | | | | 101,762 | |
| | | | | | | 805,653 | |
|
Electric Utilities – 1.8% | |
| | |
Acciona SA | | | 324 | | | | 40,754 | |
| | |
EDP – Energias de Portugal SA | | | 37,314 | | | | 156,580 | |
| | |
Hydro One Ltd.(a) | | | 486 | | | | 12,589 | |
| | |
Iberdrola SA | | | 15,408 | | | | 171,006 | |
| | |
Orsted A/S | | | 2,340 | | | | 112,604 | |
| | |
Terna – Rete Elettrica Nazionale | | | 15,516 | | | | 118,509 | |
| | |
Verbund AG | | | 864 | | | | 74,886 | |
| | | | | | | 686,928 | |
|
Electrical Equipment – 2.1% | |
| | |
Mitsubishi Electric Corp. | | | 7,200 | | | | 79,752 | |
| | |
Schneider Electric SE | | | 2,934 | | | | 449,618 | |
| | |
Vestas Wind Systems A/S* | | | 11,664 | | | | 251,504 | |
| | | | | | | 780,874 | |
See Accompanying Notes to the Financial Statements.
| | | | |
308 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electronic Equipment, Instruments & Components – 0.4% | |
| | |
Murata Manufacturing Co. Ltd. | | | 5,400 | | | $ | 88,339 | |
| | |
Omron Corp. | | | 2,000 | | | | 70,613 | |
| | | | | | | 158,952 | |
|
Energy Equipment & Services – 0.0%(b) | |
| | |
Tenaris SA | | | 720 | | | | 11,294 | |
|
Entertainment – 0.1% | |
| | |
Nintendo Co. Ltd. | | | 800 | | | | 32,862 | |
|
Financial Services – 0.2% | |
| | |
M&G plc | | | 22,158 | | | | 53,291 | |
| | |
Worldline SA* (a) | | | 2,538 | | | | 32,139 | |
| | | | | | | 85,430 | |
|
Food Products – 2.1% | |
| | |
Ajinomoto Co., Inc. | | | 1,100 | | | | 39,803 | |
| | |
Nestle SA (Registered) | | | 7,020 | | | | 756,422 | |
| | | | | | | 796,225 | |
|
Gas Utilities – 0.4% | |
| | |
AltaGas Ltd. | | | 1,818 | | | | 33,734 | |
| | |
APA Group | | | 2,790 | | | | 14,556 | |
| | |
Hong Kong & China Gas Co. Ltd. | | | 144,000 | | | | 100,299 | |
| | | | | | | 148,589 | |
|
Ground Transportation – 2.1% | |
| | |
Canadian National Railway Co. | | | 3,114 | | | | 329,132 | |
| | |
Canadian Pacific Kansas City Ltd. | | | 2,160 | | | | 153,196 | |
| | |
Central Japan Railway Co. | | | 2,500 | | | | 56,060 | |
| | |
East Japan Railway Co. | | | 3,600 | | | | 187,125 | |
| | |
MTR Corp. Ltd. | | | 11,000 | | | | 41,120 | |
| | |
West Japan Railway Co. | | | 300 | | | | 11,382 | |
| | | | | | | 778,015 | |
|
Health Care Equipment & Supplies – 2.2% | |
| | |
BioMerieux | | | 558 | | | | 53,377 | |
| | |
Koninklijke Philips NV* | | | 10,944 | | | | 207,041 | |
| | |
Olympus Corp. | | | 9,000 | | | | 118,796 | |
| | |
Siemens Healthineers AG(a) | | | 3,600 | | | | 176,257 | |
| | |
Sonova Holding AG (Registered) | | | 594 | | | | 140,007 | |
| | |
Sysmex Corp. | | | 1,800 | | | | 85,017 | |
| | |
Terumo Corp. | | | 1,800 | | | | 48,635 | |
| | | | | | | 829,130 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotels, Restaurants & Leisure – 1.5% | |
| | |
Amadeus IT Group SA | | | 5,418 | | | $ | 308,218 | |
| | |
Genting Singapore Ltd. | | | 55,800 | | | | 35,026 | |
| | |
Oriental Land Co. Ltd. | | | 1,800 | | | | 57,728 | |
| | |
Sands China Ltd.* | | | 28,800 | | | | 77,295 | |
| | |
Whitbread plc | | | 2,268 | | | | 91,590 | |
| | | | | | | 569,857 | |
|
Household Durables – 1.3% | |
| | |
Barratt Developments plc | | | 4,608 | | | | 23,144 | |
| | |
Berkeley Group Holdings plc | | | 936 | | | | 45,840 | |
| | |
Sekisui House Ltd. | | | 3,600 | | | | 69,863 | |
| | |
Sony Group Corp. | | | 4,300 | | | | 352,785 | |
| | | | | | | 491,632 | |
|
Household Products – 0.5% | |
| | |
Henkel AG & Co. KGaA (Preference) | | | 1,890 | | | | 136,005 | |
| | |
Reckitt Benckiser Group plc | | | 756 | | | | 50,474 | |
| | | | | | | 186,479 | |
|
Independent Power and Renewable Electricity Producers – 0.2% | |
| | |
Corp. ACCIONA Energias Renovables SA | | | 1,062 | | | | 28,714 | |
| | |
EDP Renovaveis SA | | | 2,502 | | | | 40,172 | |
| | | | | | | 68,886 | |
|
Industrial Conglomerates – 2.0% | |
| | |
Hitachi Ltd. | | | 7,200 | | | | 450,556 | |
| | |
Siemens AG (Registered) | | | 2,358 | | | | 311,451 | |
| | | | | | | 762,007 | |
|
Industrial REITs – 0.5% | |
| | |
Nippon Prologis REIT, Inc., REIT | | | 18 | | | | 31,948 | |
| | |
Segro plc, REIT | | | 15,876 | | | | 137,319 | |
| | | | | | | 169,267 | |
|
Insurance – 6.3% | |
| | |
AIA Group Ltd. | | | 28,800 | | | | 249,736 | |
| | |
Allianz SE (Registered) | | | 1,818 | | | | 424,487 | |
| | |
ASR Nederland NV | | | 1,224 | | | | 45,541 | |
| | |
Aviva plc | | | 26,316 | | | | 126,966 | |
| | |
AXA SA | | | 11,826 | | | | 349,440 | |
| | |
Dai-ichi Life Holdings, Inc. | | | 100 | | | | 2,097 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 309 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Legal & General Group plc | | | 75,168 | | | $ | 192,824 | |
| | |
MS&AD Insurance Group Holdings, Inc. | | | 5,400 | | | | 195,861 | |
| | |
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | | | 306 | | | | 122,423 | |
| | |
NN Group NV | | | 2,287 | | | | 73,149 | |
| | |
QBE Insurance Group Ltd. | | | 4,662 | | | | 46,047 | |
| | |
Sun Life Financial, Inc. | | | 4,050 | | | | 184,784 | |
| | |
Swiss Re AG | | | 828 | | | | 90,183 | |
| | |
Zurich Insurance Group AG | | | 576 | | | | 272,541 | |
| | | | | | | 2,376,079 | |
|
Interactive Media & Services – 0.2% | |
| | |
LY Corp. | | | 32,400 | | | | 81,789 | |
|
IT Services – 2.1% | |
| | |
Capgemini SE | | | 1,584 | | | | 278,769 | |
| | |
CGI, Inc.* | | | 774 | | | | 74,643 | |
| | |
Fujitsu Ltd. | | | 2,200 | | | | 282,037 | |
| | |
Nomura Research Institute Ltd. | | | 5,400 | | | | 140,629 | |
| | | | | | | 776,078 | |
|
Leisure Products – 0.1% | |
| | |
Yamaha Corp. | | | 1,800 | | | | 47,292 | |
|
Machinery – 1.8% | |
| | |
Alstom SA | | | 3,536 | | | | 47,654 | |
| | |
Atlas Copco AB, Class A | | | 7,776 | | | | 100,361 | |
| | |
Epiroc AB, Class A | | | 4,086 | | | | 67,109 | |
| | |
GEA Group AG | | | 1,566 | | | | 53,349 | |
| | |
Hitachi Construction Machinery Co. Ltd. | | | 1,800 | | | | 45,783 | |
| | |
KION Group AG | | | 882 | | | | 26,887 | |
| | |
Komatsu Ltd. | | | 5,400 | | | | 123,478 | |
| | |
Kone OYJ, Class B | | | 18 | | | | 778 | |
| | |
MINEBEA MITSUMI, Inc. | | | 1,800 | | | | 27,687 | |
| | |
SKF AB, Class B | | | 4,446 | | | | 71,668 | |
| | |
Volvo AB, Class B | | | 1,368 | | | | 27,047 | |
| | |
Weir Group plc (The) | | | 702 | | | | 14,541 | |
| | |
Yaskawa Electric Corp. | | | 1,800 | | | | 57,966 | |
| | | | | | | 664,308 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Media – 1.0% | |
| | |
Dentsu Group, Inc. | | | 2,100 | | | $ | 60,319 | |
| | |
Informa plc | | | 4,428 | | | | 38,236 | |
| | |
Publicis Groupe SA | | | 2,160 | | | | 163,745 | |
| | |
WPP plc | | | 12,852 | | | | 110,196 | |
| | | | | | | 372,496 | |
|
Metals & Mining – 2.6% | |
| | |
Anglo American plc | | | 1,278 | | | | 32,512 | |
| | |
Barrick Gold Corp. | | | 1,530 | | | | 24,412 | |
| | |
BlueScope Steel Ltd. | | | 2,934 | | | | 34,924 | |
| | |
Fortescue Metals Group Ltd. | | | 5,346 | | | | 75,481 | |
| | |
Kinross Gold Corp. | | | 14,526 | | | | 75,756 | |
| | |
Mineral Resources Ltd. | | | 2,070 | | | | 75,701 | |
| | |
Norsk Hydro ASA | | | 2,772 | | | | 15,801 | |
| | |
Northern Star Resources Ltd. | | | 6,048 | | | | 44,764 | |
| | |
Rio Tinto Ltd. | | | 1,962 | | | | 146,063 | |
| | |
Rio Tinto plc | | | 2,304 | | | | 146,919 | |
| | |
Teck Resources Ltd., Class B | | | 2,430 | | | | 85,770 | |
| | |
Wheaton Precious Metals Corp. | | | 5,436 | | | | 229,344 | |
| | | | | | | 987,447 | |
|
Multi-Utilities – 0.4% | |
| | |
Algonquin Power & Utilities Corp. | | | 6,894 | | | | 34,662 | |
| | |
National Grid plc | | | 7,902 | | | | 93,835 | |
| | | | | | | 128,497 | |
|
Office REITs – 0.4% | |
| | |
Dexus, REIT | | | 9,270 | | | | 38,033 | |
| | |
Gecina SA, REIT | | | 612 | | | | 59,901 | |
| | |
Japan Real Estate Investment Corp., REIT | | | 18 | | | | 66,678 | |
| | | | | | | 164,612 | |
|
Oil, Gas & Consumable Fuels – 6.2% | |
| | |
Ampol Ltd. | | | 3,294 | | | | 66,447 | |
| | |
BP plc | | | 2,628 | | | | 16,028 | |
| | |
Cameco Corp. | | | 5,058 | | | | 206,692 | |
| | |
Enbridge, Inc. | | | 13,032 | | | | 417,174 | |
| | |
ENEOS Holdings, Inc. | | | 19,800 | | | | 72,914 | |
| | |
Eni SpA | | | 6,984 | | | | 113,891 | |
| | |
Neste OYJ | | | 4,788 | | | | 160,482 | |
| | |
Pembina Pipeline Corp. | | | 2,970 | | | | 91,309 | |
| | |
Repsol SA | | | 8,010 | | | | 117,050 | |
| | |
Shell plc | | | 21,348 | | | | 685,569 | |
See Accompanying Notes to the Financial Statements.
| | | | |
310 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
| | | | | | | | |
Investments | | Investments | | | Shares | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
TC Energy Corp. | | | 378 | | | $ | 13,004 | |
| | |
TotalEnergies SE | | | 5,202 | | | | 347,506 | |
| | |
Tourmaline Oil Corp. | | | 594 | | | | 31,376 | |
| | |
Woodside Energy Group Ltd. | | | 1 | | | | 20 | |
| | | | | | | 2,339,462 | |
|
Paper & Forest Products – 0.4% | |
| | |
Mondi plc | | | 5,148 | | | | 83,020 | |
| | |
West Fraser Timber Co. Ltd. | | | 738 | | | | 49,753 | |
| | | | | | | 132,773 | |
|
Personal Care Products – 2.0% | |
| | |
Kao Corp. | | | 5,400 | | | | 195,897 | |
| | |
L’Oreal SA | | | 1,278 | | | | 535,137 | |
| | | | | | | 731,034 | |
|
Pharmaceuticals – 9.4% | |
| | |
AstraZeneca plc | | | 4,338 | | | | 539,555 | |
| | |
Daiichi Sankyo Co. Ltd. | | | 7,200 | | | | 183,417 | |
| | |
GSK plc | | | 13,446 | | | | 237,790 | |
| | |
Novartis AG (Registered) | | | 4,518 | | | | 419,704 | |
| | |
Novo Nordisk A/S, Class B | | | 10,404 | | | | 997,473 | |
| | |
Ono Pharmaceutical Co. Ltd. | | | 3,700 | | | | 63,558 | |
| | |
Roche Holding AG | | | 1,818 | | | | 467,160 | |
| | |
Sanofi SA | | | 3,708 | | | | 335,889 | |
| | |
Takeda Pharmaceutical Co. Ltd. | | | 9,000 | | | | 241,454 | |
| | |
UCB SA | | | 504 | | | | 36,790 | |
| | | | | | | 3,522,790 | |
|
Professional Services – 2.4% | |
| | |
Experian plc | | | 972 | | | | 29,381 | |
| | |
Randstad NV | | | 1,350 | | | | 69,692 | |
| | |
Recruit Holdings Co. Ltd. | | | 3,900 | | | | 111,583 | |
| | |
RELX plc | | | 13,536 | | | | 471,076 | |
| | |
Wolters Kluwer NV | | | 1,710 | | | | 218,885 | |
| | | | | | | 900,617 | |
|
Real Estate Management & Development – 0.6% | |
| | |
Daiwa House Industry Co. Ltd. | | | 7,200 | | | | 196,206 | |
| | |
ESR Group Ltd.(a) | | | 28,800 | | | | 36,954 | |
| | | | | | | 233,160 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Retail REITs – 0.3% | |
| | |
CapitaLand Integrated Commercial Trust, REIT | | | 50,400 | | | $ | 64,745 | |
| | |
Vicinity Ltd., REIT | | | 48,978 | | | | 52,718 | |
| | | | | | | 117,463 | |
|
Semiconductors & Semiconductor Equipment – 2.2% | |
| | |
Advantest Corp. | | | 4,800 | | | | 120,915 | |
| | |
ASML Holding NV | | | 1,062 | | | | 634,569 | |
| | |
Renesas Electronics Corp.* | | | 1,800 | | | | 23,242 | |
| | |
Tokyo Electron Ltd. | | | 400 | | | | 52,177 | |
| | | | | | | 830,903 | |
|
Software – 2.2% | |
| | |
Open Text Corp. | | | 2,970 | | | | 99,053 | |
| | |
SAP SE | | | 4,770 | | | | 639,009 | |
| | |
Xero Ltd.* | | | 1,494 | | | | 100,921 | |
| | | | | | | 838,983 | |
|
Specialty Retail – 1.4% | |
| | |
Fast Retailing Co. Ltd. | | | 200 | | | | 43,607 | |
| | |
H & M Hennes & Mauritz AB, Class B | | | 3,186 | | | | 42,574 | |
| | |
Industria de Diseno Textil SA | | | 10,908 | | | | 375,294 | |
| | |
Zalando SE* (a) | | | 2,322 | | | | 53,971 | |
| | | | | | | 515,446 | |
|
Technology Hardware, Storage & Peripherals – 0.9% | |
| | |
Canon, Inc. | | | 10,200 | | | | 239,164 | |
| | |
Ricoh Co. Ltd. | | | 7,200 | | | | 57,645 | |
| | |
Seiko Epson Corp. | | | 3,600 | | | | 49,360 | |
| | | | | | | 346,169 | |
|
Textiles, Apparel & Luxury Goods – 2.2% | |
| | |
adidas AG | | | 468 | | | | 82,710 | |
| | |
Burberry Group plc | | | 4,626 | | | | 94,979 | |
| | |
Cie Financiere Richemont SA (Registered) | | | 162 | | | | 19,030 | |
| | |
Kering SA | | | 738 | | | | 298,921 | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 468 | | | | 333,659 | |
| | | | | | | 829,299 | |
|
Trading Companies & Distributors – 1.3% | |
| | |
Bunzl plc | | | 3,168 | | | | 112,712 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 311 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Trading Companies & Distributors – (continued) | |
| | |
Ferguson plc | | | 72 | | | $ | 10,773 | |
| | |
ITOCHU Corp. | | | 9,000 | | | | 319,304 | |
| | |
Rexel SA | | | 2,412 | | | | 49,039 | |
| | | | | | | 491,828 | |
|
Transportation Infrastructure – 0.9% | |
| | |
Getlink SE | | | 3,618 | | | | 58,262 | |
| | |
Transurban Group | | | 38,268 | | | | 286,391 | |
| | | | | | | 344,653 | |
|
Water Utilities – 0.1% | |
| | |
Severn Trent plc | | | 882 | | | | 28,426 | |
|
Wireless Telecommunication Services – 0.9% | |
| | |
Rogers Communications, Inc., Class B | | | 126 | | | | 4,663 | |
| | |
SoftBank Corp. | | | 18,000 | | | | 202,648 | |
| | |
Vodafone Group plc | | | 143,172 | | | | 131,515 | |
| | | | | | | 338,826 | |
Total Common Stocks (Cost $38,644,229) | | | | 36,835,813 | |
| | | | | | | | |
Total Investments – 98.3% (Cost $38,644,229) | | | | | | | 36,835,813 | |
| | |
Other assets less liabilities – 1.7% | | | | | | | 648,393 | |
NET ASSETS – 100.0% | | | $ | 37,484,206 | |
* | Non-income producing security. |
(a) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(b) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
Abbreviations
CVA – Dutch Certification
OYJ – Public Limited Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference. REIT
Real Estate – Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 1,824,498 | |
Aggregate gross unrealized depreciation | | | (3,684,607 | ) |
Net unrealized depreciation | | $ | (1,860,109 | ) |
Federal income tax cost | | $ | 38,677,626 | |
Futures Contracts
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
MSCI EAFE E-Mini Index | | | 6 | | | | 12/15/2023 | | | | USD | | | $ | 592,230 | | | $ | (20,226 | ) |
TOPIX Mini Index | | | 2 | | | | 12/07/2023 | | | | JPY | | | | 29,767 | | | | (1,268 | ) |
| | | | | | | | | | | | | | | | | | $ | (21,494 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
See Accompanying Notes to the Financial Statements.
| | | | |
312 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
Forward Foreign Currency Contracts
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 87,496 | | | | | Citibank NA | | AUD | | | 135,070 | | | | 12/20/2023 | | | $ | 1,835 | |
USD | | | 13,827 | | | | | Citibank NA | | CAD | | | 18,709 | | | | 12/20/2023 | | | | 339 | |
USD | | | 25,831 | | | | | UBS AG | | CHF | | | 22,857 | | | | 12/20/2023 | | | | 573 | |
USD | | | 32,509 | | | | | UBS AG | | DKK | | | 225,761 | | | | 12/20/2023 | | | | 449 | |
USD | | | 68,164 | | | | | Toronto-Dominion Bank (The) | | EUR | | | 63,606 | | | | 12/20/2023 | | | | 778 | |
USD | | | 28,653 | | | | | Toronto-Dominion Bank (The) | | GBP | | | 23,011 | | | | 12/20/2023 | | | | 719 | |
USD | | | 20,097 | | | | | BNP Paribas SA | | HKD | | | 157,028 | | | | 12/20/2023 | | | | 13 | |
USD | | | 2,257 | | | | | Citibank NA | | ILS | | | 8,590 | | | | 12/20/2023 | | | | 128 | |
USD | | | 45,240 | | | | | Citibank NA | | JPY | | | 6,674,000 | | | | 12/20/2023 | | | | 800 | |
USD | | | 21,373 | | | | | Citibank NA | | NZD | | | 36,099 | | | | 12/20/2023 | | | | 373 | |
USD | | | 35,127 | | | | | Citibank NA | | SEK | | | 390,201 | | | | 12/20/2023 | | | | 117 | |
USD | | | 39,364 | | | | | BNP Paribas SA | | SGD | | | 53,311 | | | | 12/20/2023 | | | | 368 | |
Total unrealized appreciation | | | $ | 6,492 | |
AUD | | | 66,000 | | | | | Toronto-Dominion Bank (The) | | USD | | | 42,631 | | | | 12/20/2023 | | | $ | (775 | ) |
JPY | | | 6,795,910 | | | | | Toronto-Dominion Bank (The) | | USD | | | 46,742 | | | | 12/20/2023 | | | | (1,491 | ) |
NOK | | | 161,527 | | | | | Goldman Sachs & Co. | | USD | | | 15,065 | | | | 12/20/2023 | | | | (585 | ) |
SGD | | | 60,000 | | | | | JPMorgan Chase Bank NA | | USD | | | 44,207 | | | | 12/20/2023 | | | | (317 | ) |
USD | | | 41,867 | | | | | Toronto-Dominion Bank (The) | | CHF | | | 38,000 | | | | 12/20/2023 | | | | (126 | ) |
Total unrealized depreciation | | | $ | (3,294 | ) |
Net unrealized appreciation | | | $ | 3,198 | |
Abbreviations:
AUD – Australian Dollar
CAD – Canadian Dollar
CHF – Swiss Franc
DKK – Danish Krone
EUR – Euro
GBP – British Pound
HKD – Hong Kong Dollar
ILS – Israeli Shekel
JPY – Japanese Yen
NOK – Norwegian Krone
NZD – New Zealand Dollar
SEK – Swedish Krona
SGD – Singapore Dollar
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 313 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (cont.)
FlexShares® ESG & Climate Developed Markets ex-US Core Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 6.8 | % |
Austria | | | 0.2 | |
Belgium | | | 0.4 | |
Canada | | | 10.2 | |
Denmark | | | 4.1 | |
Finland | | | 0.6 | |
France | | | 11.6 | |
Germany | | | 8.3 | |
Hong Kong | | | 1.6 | |
Ireland | | | 0.5 | |
Italy | | | 0.6 | |
Japan | | | 19.4 | |
Netherlands | | | 4.4 | |
New Zealand | | | 0.3 | |
Norway | | | 0.0 | † |
Portugal | | | 0.8 | |
Singapore | | | 0.4 | |
Spain | | | 3.4 | |
Sweden | | | 1.2 | |
Switzerland | | | 8.8 | |
United Kingdom | | | 14.7 | |
Other1 | | | 1.7 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.3 | % |
Others(1) | | | 1.7 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
314 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® ESG & Climate Emerging Markets Core Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.9% | |
|
Air Freight & Logistics – 0.2% | |
| | |
Hyundai Glovis Co. Ltd. | | | 62 | | | $ | 7,855 | |
| | |
JD Logistics, Inc.* (a) | | | 1,600 | | | | 1,893 | |
| | | | | | | 9,748 | |
|
Automobile Components – 0.7% | |
| | |
Hyundai Mobis Co. Ltd. | | | 202 | | | | 31,185 | |
|
Automobiles – 1.9% | |
| | |
Eicher Motors Ltd. | | | 150 | | | | 5,937 | |
| | |
Ford Otomotiv Sanayi A/S | | | 128 | | | | 3,557 | |
| | |
Li Auto, Inc., ADR* | | | 1,406 | | | | 47,537 | |
| | |
XPeng, Inc., Class A* | | | 3,100 | | | | 22,900 | |
| | | | | | | 79,931 | |
|
Banks – 17.5% | |
| | |
Abu Dhabi Commercial Bank PJSC | | | 3,816 | | | | 8,343 | |
| | |
Agricultural Bank of China Ltd., Class H | | | 50,000 | | | | 18,467 | |
| | |
Akbank TAS | | | 10,766 | | | | 11,210 | |
| | |
Alinma Bank | | | 1,608 | | | | 14,102 | |
| | |
AU Small Finance Bank Ltd.(a) | | | 570 | | | | 4,581 | |
| | |
Axis Bank Ltd. | | | 304 | | | | 3,585 | |
| | |
Banco Bradesco SA | | | 5,300 | | | | 12,916 | |
| | |
Banco Bradesco SA (Preference) | | | 10,000 | | | | 27,741 | |
| | |
Banco do Brasil SA | | | 2,900 | | | | 27,804 | |
| | |
Bancolombia SA | | | 802 | | | | 5,690 | |
| | |
Bancolombia SA (Preference) | | | 1,470 | | | | 9,381 | |
| | |
Bank AlBilad | | | 538 | | | | 5,335 | |
| | |
Bank Rakyat Indonesia Persero Tbk. PT | | | 89,400 | | | | 27,915 | |
| | |
Banque Saudi Fransi | | | 46 | | | | 440 | |
| | |
China Construction Bank Corp., Class H | | | 82,000 | | | | 46,530 | |
| | |
CIMB Group Holdings Bhd. | | | 16,800 | | | | 20,134 | |
| | |
Commercial International Bank Egypt SAE | | | 8,800 | | | | 17,173 | |
| | |
E.Sun Financial Holding Co. Ltd. | | | 47,585 | | | | 34,990 | |
| | |
Eurobank Ergasias Services and Holdings SA* | | | 8,970 | | | | 14,620 | |
| | |
First Abu Dhabi Bank PJSC | | | 9,450 | | | | 32,623 | |
| | |
First Financial Holding Co. Ltd. | | | 23,710 | | | | 18,933 | |
| | |
Grupo Financiero Banorte SAB de CV, Class O | | | 1,304 | | | | 10,569 | |
| | |
Hana Financial Group, Inc. | | | 996 | | | | 28,909 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Hong Leong Bank Bhd. | | | 1,800 | | | $ | 7,329 | |
| | |
Industrial & Commercial Bank of China Ltd., Class H | | | 72,000 | | | | 34,599 | |
| | |
ING Bank Slaski SA* | | | 114 | | | | 5,911 | |
| | |
Itau Unibanco Holding SA (Preference) | | | 1,788 | | | | 9,509 | |
| | |
KB Financial Group, Inc. | | | 1,098 | | | | 41,870 | |
| | |
Malayan Banking Bhd. | | | 18,400 | | | | 34,834 | |
| | |
Mega Financial Holding Co. Ltd. | | | 37,000 | | | | 41,865 | |
| | |
Nedbank Group Ltd. | | | 1,454 | | | | 15,556 | |
| | |
OTP Bank Nyrt. | | | 770 | | | | 28,589 | |
| | |
Powszechna Kasa Oszczednosci Bank Polski SA* | | | 254 | | | | 2,623 | |
| | |
Santander Bank Polska SA* | | | 118 | | | | 12,780 | |
| | |
Shinhan Financial Group Co. Ltd. | | | 1,430 | | | | 36,794 | |
| | |
SinoPac Financial Holdings Co. Ltd. | | | 6,334 | | | | 3,486 | |
| | |
Standard Bank Group Ltd. | | | 3,724 | | | | 36,330 | |
| | |
Taishin Financial Holding Co. Ltd. | | | 14,086 | | | | 7,491 | |
| | |
Yapi ve Kredi Bankasi A/S | | | 9,664 | | | | 5,889 | |
| | |
Yes Bank Ltd.* | | | 39,544 | | | | 7,576 | |
| | | | | | | 735,022 | |
|
Beverages – 0.8% | |
| | |
Ambev SA | | | 5,400 | | | | 13,770 | |
| | |
Coca-Cola Femsa SAB de CV | | | 1,800 | | | | 13,639 | |
| | |
Nongfu Spring Co. Ltd., Class H(b) | | | 200 | | | | 1,139 | |
| | |
United Spirits Ltd.* | | | 286 | | | | 3,545 | |
| | |
Varun Beverages Ltd. | | | 228 | | | | 2,489 | |
| | | | | | | 34,582 | |
|
Biotechnology – 0.1% | |
| | |
BeiGene Ltd.* | | | 400 | | | | 5,792 | |
|
Broadline Retail – 6.4% | |
| | |
Alibaba Group Holding Ltd., ADR* | | | 2,152 | | | | 177,626 | |
| | |
JD.com, Inc., ADR | | | 70 | | | | 1,779 | |
| | |
Naspers Ltd., Class N* | | | 96 | | | | 14,898 | |
| | |
PDD Holdings, Inc., ADR* | | | 188 | | | | 19,067 | |
| | |
Prosus NV* | | | 989 | | | | 27,629 | |
| | |
Vipshop Holdings Ltd., ADR* | | | 1,180 | | | | 16,827 | |
| | |
Woolworths Holdings Ltd. | | | 3,136 | | | | 11,608 | |
| | | | | | | 269,434 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 315 | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Capital Markets – 0.4% | |
| | |
B3 SA – Brasil Bolsa Balcao | | | 2,000 | | | $ | 4,402 | |
| | |
Mirae Asset Securities Co. Ltd. | | | 944 | | | | 4,613 | |
| | |
NH Investment & Securities Co. Ltd. | | | 516 | | | | 3,698 | |
| | |
Saudi Tadawul Group Holding Co. | | | 128 | | | | 5,671 | |
| | | | | | | 18,384 | |
|
Chemicals – 2.6% | |
| | |
Asian Paints Ltd. | | | 1,104 | | | | 39,723 | |
| | |
Hanwha Solutions Corp.* | | | 354 | | | | 7,510 | |
| | |
Indorama Ventures PCL, NVDR | | | 5,800 | | | | 3,824 | |
| | |
LG Chem Ltd. | | | 40 | | | | 13,032 | |
| | |
Orbia Advance Corp. SAB de CV | | | 3,450 | | | | 5,582 | |
| | |
PI Industries Ltd. | | | 118 | | | | 4,820 | |
| | |
PTT Global Chemical PCL, NVDR | | | 4,600 | | | | 4,415 | |
| | |
Sahara International Petrochemical Co. | | | 400 | | | | 3,439 | |
| | |
SK IE Technology Co. Ltd.* (a) | | | 88 | | | | 3,864 | |
| | |
UPL Ltd. | | | 1,686 | | | | 10,945 | |
| | |
Yanbu National Petrochemical Co. | | | 974 | | | | 9,827 | |
| | | | | | | 106,981 | |
|
Communications Equipment – 0.1% | |
| | |
ZTE Corp., Class H | | | 2,400 | | | | 5,331 | |
|
Construction & Engineering – 0.4% | |
| | |
Hyundai Engineering & Construction Co. Ltd. | | | 276 | | | | 6,825 | |
| | |
Samsung Engineering Co. Ltd.* | | | 454 | | | | 7,984 | |
| | | | | | | 14,809 | |
|
Construction Materials – 0.9% | |
| | |
ACC Ltd. | | | 168 | | | | 3,810 | |
| | |
Ambuja Cements Ltd. | | | 1,776 | | | | 9,054 | |
| | |
Siam Cement PCL (The), NVDR | | | 2,600 | | | | 20,834 | |
| | |
UltraTech Cement Ltd. | | | 52 | | | | 5,260 | |
| | | | | | | 38,958 | |
|
Consumer Staples Distribution & Retail – 2.2% | |
| | |
Alibaba Health Information Technology Ltd.* | | | 16,000 | | | | 9,427 | |
| | |
CP ALL PCL, NVDR | | | 16,200 | | | | 24,902 | |
| | |
Nahdi Medical Co. | | | 20 | | | | 756 | |
| | |
Raia Drogasil SA | | | 408 | | | | 2,087 | |
| | |
Shoprite Holdings Ltd. | | | 1,076 | | | | 13,708 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Wal-Mart de Mexico SAB de CV | | | 11,700 | | | $ | 41,822 | |
| | | | | | | 92,702 | |
|
Containers & Packaging – 0.5% | |
| | |
Klabin SA | | | 2,400 | | | | 10,185 | |
| | |
Klabin SA (Preference) | | | 6,996 | | | | 5,951 | |
| | |
SCG Packaging PCL, NVDR | | | 4,200 | | | | 4,207 | |
| | | | | | | 20,343 | |
|
Diversified Consumer Services – 0.2% | |
| | |
East Buy Holding Ltd.* (a) | | | 500 | | | | 2,038 | |
| | |
New Oriental Education & Technology Group, Inc., ADR* | | | 124 | | | | 8,121 | |
| | | | | | | 10,159 | |
|
Diversified Telecommunication Services – 2.2% | |
| | |
Chunghwa Telecom Co. Ltd. | | | 10,722 | | | | 38,346 | |
| | |
Emirates Telecommunications Group Co. PJSC | | | 518 | | | | 2,603 | |
| | |
Hellenic Telecommunications Organization SA | | | 622 | | | | 8,698 | |
| | |
Indus Towers Ltd.* | | | 2,388 | | | | 4,945 | |
| | |
LG Uplus Corp. | | | 764 | | | | 5,719 | |
| | |
PT Tower Bersama Infrastructure Tbk. | | | 13,000 | | | | 1,694 | |
| | |
Saudi Telecom Co. | | | 1,866 | | | | 19,100 | |
| | |
Telefonica Brasil SA | | | 1,400 | | | | 12,559 | |
| | | | | | | 93,664 | |
|
Electric Utilities – 1.0% | |
| | |
Centrais Eletricas Brasileiras SA | | | 2,000 | | | | 13,817 | |
| | |
Centrais Eletricas Brasileiras SA (Preference), Class B | | | 800 | | | | 6,100 | |
| | |
CEZ A/S | | | 76 | | | | 3,247 | |
| | |
Cia Energetica de Minas Gerais | | | 800 | | | | 2,443 | |
| | |
Cia Energetica de Minas Gerais (Preference) | | | 4,600 | | | | 10,709 | |
| | |
Cia Paranaense de Energia (Preference) | | | 4,400 | | | | 7,320 | |
| | | | | | | 43,636 | |
|
Electrical Equipment – 1.3% | |
| | |
ABB India Ltd. | | | 182 | | | | 8,983 | |
| | |
CG Power & Industrial Solutions Ltd. | | | 2,020 | | | | 9,464 | |
| | |
Doosan Enerbility Co. Ltd.* | | | 120 | | | | 1,192 | |
See Accompanying Notes to the Financial Statements.
| | | | |
316 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electrical Equipment – (continued) | |
| | |
Havells India Ltd. | | | 834 | | | $ | 12,483 | |
| | |
Polycab India Ltd. | | | 140 | | | | 8,277 | |
| | |
Sociedad Quimica y Minera de Chile SA (Preference), Class B | | | 304 | | | | 14,660 | |
| | | | | | | 55,059 | |
|
Electronic Equipment, Instruments & Components – 1.8% | |
| | |
AUO Corp. | | | 21,406 | | | | 10,295 | |
| | |
Delta Electronics Thailand PCL, NVDR | | | 4,400 | | | | 9,671 | |
| | |
Delta Electronics, Inc. | | | 2,560 | | | | 22,928 | |
| | |
Hon Hai Precision Industry Co. Ltd. | | | 3,000 | | | | 8,926 | |
| | |
Samsung Electro-Mechanics Co. Ltd. | | | 192 | | | | 17,671 | |
| | |
Samsung SDI Co. Ltd. | | | 18 | | | | 5,671 | |
| | | | | | | 75,162 | |
|
Energy Equipment & Services – 0.1% | |
| | |
Dialog Group Bhd. | | | 10,600 | | | | 4,783 | |
|
Entertainment – 2.3% | |
| | |
Kingsoft Corp. Ltd. | | | 3,200 | | | | 11,165 | |
| | |
NCSoft Corp. | | | 20 | | | | 3,443 | |
| | |
NetEase, Inc., ADR | | | 758 | | | | 81,045 | |
| | | | | | | 95,653 | |
|
Financial Services – 1.2% | |
| | |
FirstRand Ltd. | | | 7,192 | | | | 23,571 | |
| | |
Yuanta Financial Holding Co. Ltd. | | | 34,130 | | | | 25,570 | |
| | | | | | | 49,141 | |
|
Food Products – 1.0% | |
| | |
Almarai Co. JSC | | | 90 | | | | 1,341 | |
| | |
Britannia Industries Ltd. | | | 174 | | | | 9,251 | |
| | |
Charoen Pokphand Foods PCL, NVDR | | | 6,200 | | | | 3,226 | |
| | |
CJ CheilJedang Corp. | | | 28 | | | | 5,857 | |
| | |
IOI Corp. Bhd. | | | 8,600 | | | | 7,093 | |
| | |
Marico Ltd. | | | 1,716 | | | | 11,058 | |
| | |
Nestle Malaysia Bhd. | | | 200 | | | | 5,197 | |
| | | | | | | 43,023 | |
|
Gas Utilities – 0.6% | |
| | |
China Resources Gas Group Ltd. | | | 1,800 | | | | 5,325 | |
| | |
ENN Energy Holdings Ltd. | | | 2,700 | | | | 20,618 | |
| | | | | | | 25,943 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Ground Transportation – 0.8% | |
| | |
BTS Group Holdings PCL, NVDR | | | 25,000 | | | $ | 5,182 | |
| | |
Full Truck Alliance Co. Ltd., ADR* | | | 1,042 | | | | 6,846 | |
| | |
Rumo SA | | | 4,400 | | | | 19,465 | |
| | | | | | | 31,493 | |
|
Health Care Equipment & Supplies – 0.0%(c) | |
| | |
Microport Scientific Corp.* | | | 600 | | | | 943 | |
|
Health Care Providers & Services – 0.4% | |
| | |
Dr Sulaiman Al Habib Medical Services Group Co. | | | 64 | | | | 4,299 | |
| | |
Sinopharm Group Co. Ltd., Class H | | | 4,400 | | | | 10,516 | |
| | | | | | | 14,815 | |
|
Hotels, Restaurants & Leisure – 3.1% | |
| | |
Meituan, Class B* (a) | | | 5,400 | | | | 76,328 | |
| | |
Trip.com Group Ltd.* | | | 500 | | | | 17,177 | |
| | |
Yum China Holdings, Inc. | | | 728 | | | | 38,264 | |
| | | | | | | 131,769 | |
|
Household Durables – 0.7% | |
| | |
Arcelik A/S | | | 292 | | | | 1,402 | |
| | |
LG Electronics, Inc. | | | 364 | | | | 26,871 | |
| | | | | | | 28,273 | |
|
Household Products – 0.2% | |
| | |
Unilever Indonesia Tbk. PT | | | 26,800 | | | | 6,107 | |
|
Independent Power and Renewable Electricity Producers – 0.8% | |
| | |
Adani Green Energy Ltd.* | | | 1,098 | | | | 12,023 | |
| | |
China Longyuan Power Group Corp. Ltd., Class H | | | 12,000 | | | | 10,168 | |
| | |
Energy Absolute PCL, NVDR | | | 6,000 | | | | 7,011 | |
| | |
Engie Brasil Energia SA | | | 400 | | | | 3,117 | |
| | | | | | | 32,319 | |
|
Industrial Conglomerates – 2.7% | |
| | |
Alpha Dhabi Holding PJSC* | | | 1,600 | | | | 8,224 | |
| | |
Astra International Tbk. PT | | | 12,200 | | | | 4,435 | |
| | |
Far Eastern New Century Corp. | | | 3,152 | | | | 2,867 | |
| | |
International Holding Co. PJSC* | | | 406 | | | | 44,170 | |
| | |
Multiply Group PJSC* | | | 10,216 | | | | 9,457 | |
| | |
Mytilineos SA | | | 112 | | | | 4,141 | |
| | |
Samsung C&T Corp. | | | 222 | | | | 17,539 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 317 | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – (continued) | |
| | |
Siemens Ltd. | | | 306 | | | $ | 12,242 | |
| | |
SK Square Co. Ltd.* | | | 118 | | | | 3,718 | |
| | |
Turkiye Sise ve Cam Fabrikalari A/S | | | 4,658 | | | | 7,794 | |
| | | | | | | 114,587 | |
|
Insurance – 3.4% | |
| | |
Bupa Arabia for Cooperative Insurance Co. | | | 100 | | | | 5,678 | |
| | |
Cathay Financial Holding Co. Ltd. | | | 26,000 | | | | 35,190 | |
| | |
Fubon Financial Holding Co. Ltd. | | | 23,100 | | | | 42,803 | |
| | |
ICICI Prudential Life Insurance Co. Ltd.(a) | | | 500 | | | | 3,154 | |
| | |
Ping An Insurance Group Co. of China Ltd., Class H | | | 9,000 | | | | 46,124 | |
| | |
Powszechny Zaklad Ubezpieczen SA | | | 502 | | | | 5,672 | |
| | |
Samsung Life Insurance Co. Ltd. | | | 42 | | | | 2,248 | |
| | | | | | | 140,869 | |
|
Interactive Media & Services – 3.2% | |
| | |
Autohome, Inc., ADR | | | 260 | | | | 6,955 | |
| | |
Info Edge India Ltd. | | | 248 | | | | 12,166 | |
| | |
Kakao Corp. | | | 1,018 | | | | 28,492 | |
| | |
Kanzhun Ltd., ADR* | | | 624 | | | | 9,235 | |
| | |
Kuaishou Technology* (a) | | | 5,600 | | | | 36,035 | |
| | |
NAVER Corp. | | | 294 | | | | 40,795 | |
| | | | | | | 133,678 | |
|
IT Services – 2.9% | |
| | |
Arabian Internet & Communications Services Co. | | | 80 | | | | 6,670 | |
| | |
Elm Co. | | | 14 | | | | 2,617 | |
| | |
Infosys Ltd. | | | 4,116 | | | | 67,649 | |
| | |
Tech Mahindra Ltd. | | | 1,812 | | | | 24,661 | |
| | |
Wipro Ltd. | | | 4,342 | | | | 19,911 | |
| | | | | | | 121,508 | |
|
Life Sciences Tools & Services – 1.6% | |
| | |
Divi’s Laboratories Ltd. | | | 348 | | | | 14,163 | |
| | |
WuXi AppTec Co. Ltd., Class H(a) | | | 1,200 | | | | 14,416 | |
| | |
Wuxi Biologics Cayman, Inc.* (a) | | | 6,000 | | | | 37,267 | |
| | | | | | | 65,846 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Machinery – 0.6% | |
| | |
Cummins India Ltd. | | | 476 | | | $ | 9,585 | |
| | |
Haitian International Holdings Ltd. | | | 2,000 | | | | 4,764 | |
| | |
Weichai Power Co. Ltd., Class H | | | 2,000 | | | | 2,991 | |
| | |
Zhuzhou CRRC Times Electric Co. Ltd., Class H | | | 1,800 | | | | 5,809 | |
| | | | | | | 23,149 | |
|
Marine Transportation – 0.2% | |
| | |
MISC Bhd. | | | 4,600 | | | | 7,000 | |
|
Media – 0.1% | |
| | |
Elang Mahkota Teknologi Tbk. PT | | | 53,600 | | | | 1,687 | |
| | |
Grupo Televisa SAB, Series CPO | | | 9,400 | | | | 4,306 | |
| | | | | | | 5,993 | |
|
Metals & Mining – 2.6% | |
| | |
Anglo American Platinum Ltd. | | | 96 | | | | 3,196 | |
| | |
Gold Fields Ltd. | | | 2,734 | | | | 36,236 | |
| | |
Grupo Mexico SAB de CV, Series B | | | 4,000 | | | | 16,292 | |
| | |
Hindalco Industries Ltd. | | | 4,114 | | | | 22,705 | |
| | |
JSW Steel Ltd. | | | 1,956 | | | | 17,299 | |
| | |
Kumba Iron Ore Ltd. | | | 214 | | | | 5,637 | |
| | |
Sibanye Stillwater Ltd. | | | 5,220 | | | | 6,655 | |
| | | | | | | 108,020 | |
|
Multi-Utilities – 0.1% | |
| | |
Dubai Electricity & Water Authority PJSC | | | 4,258 | | | | 2,759 | |
|
Oil, Gas & Consumable Fuels – 4.0% | |
| | |
Bharat Petroleum Corp. Ltd. | | | 2,348 | | | | 9,849 | |
| | |
Cosan SA | | | 4,000 | | | | 12,493 | |
| | |
COSCO SHIPPING Energy Transportation Co. Ltd., Class H | | | 4,000 | | | | 4,233 | |
| | |
Empresas Copec SA | | | 1,368 | | | | 9,027 | |
| | |
ORLEN SA | | | 1,780 | | | | 28,090 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 400 | | | | 2,755 | |
| | |
Petronas Dagangan Bhd. | | | 1,000 | | | | 4,798 | |
| | |
PTT Exploration & Production PCL, NVDR | | | 3,600 | | | | 16,426 | |
| | |
PTT PCL, NVDR | | | 23,000 | | | | 21,277 | |
| | |
Reliance Industries Ltd. | | | 1,006 | | | | 27,644 | |
| | |
SK Innovation Co. Ltd.* | | | 184 | | | | 16,649 | |
| | |
Thai Oil PCL, NVDR | | | 3,600 | | | | 4,708 | |
See Accompanying Notes to the Financial Statements.
| | | | |
318 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares�� ESG & Climate Emerging Markets Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Ultrapar Participacoes SA | | | 2,400 | | | $ | 9,732 | |
| | | | | | | 167,681 | |
|
Paper & Forest Products – 0.5% | |
| | |
Empresas CMPC SA | | | 3,974 | | | | 7,081 | |
| | |
Suzano SA | | | 1,300 | | | | 13,294 | |
| | | | | | | 20,375 | |
|
Passenger Airlines – 0.1% | |
| | |
Korean Air Lines Co. Ltd. | | | 400 | | | | 6,072 | |
|
Personal Care Products – 1.5% | |
| | |
Colgate-Palmolive India Ltd. | | | 270 | | | | 6,855 | |
| | |
Giant Biogene Holding Co. Ltd.* (a) | | | 400 | | | | 1,605 | |
| | |
Godrej Consumer Products Ltd.* | | | 588 | | | | 7,005 | |
| | |
Hindustan Unilever Ltd. | | | 1,610 | | | | 48,034 | |
| | | | | | | 63,499 | |
|
Pharmaceuticals – 2.0% | |
| | |
Aspen Pharmacare Holdings Ltd. | | | 656 | | | | 5,924 | |
| | |
China Medical System Holdings Ltd. | | | 5,000 | | | | 7,988 | |
| | |
Cipla Ltd. | | | 502 | | | | 7,235 | |
| | |
CSPC Pharmaceutical Group Ltd. | | | 30,000 | | | | 26,187 | |
| | |
Dr Reddy’s Laboratories Ltd. | | | 374 | | | | 24,111 | |
| | |
Richter Gedeon Nyrt. | | | 288 | | | | 6,738 | |
| | |
Sun Pharmaceutical Industries Ltd. | | | 512 | | | | 6,694 | |
| | | | | | | 84,877 | |
|
Real Estate Management & Development – 1.4% | |
| | |
Central Pattana PCL, NVDR | | | 6,400 | | | | 11,129 | |
| | |
DLF Ltd. | | | 2,130 | | | | 14,416 | |
| | |
KE Holdings, Inc., ADR | | | 1,114 | | | | 16,387 | |
| | |
Longfor Group Holdings Ltd.(a) | | | 3,703 | | | | 5,386 | |
| | |
Macrotech Developers Ltd.(a) | | | 108 | | | | 1,022 | |
| | |
NEPI Rockcastle NV | | | 1,558 | | | | 8,365 | |
| | | | | | | 56,705 | |
|
Semiconductors & Semiconductor Equipment – 9.3% | |
| | |
Daqo New Energy Corp., ADR* | | | 200 | | | | 5,092 | |
| | |
Flat Glass Group Co. Ltd., Class H* | | | 2,000 | | | | 3,584 | |
| | |
GCL Technology Holdings Ltd. | | | 68,000 | | | | 9,994 | |
| | |
Hua Hong Semiconductor Ltd.* (a) | | | 1,000 | | | | 2,454 | |
| | |
SK Hynix, Inc. | | | 402 | | | | 34,617 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 18,580 | | | $ | 303,031 | |
| | |
United Microelectronics Corp. | | | 17,000 | | | | 24,215 | |
| | |
Xinyi Solar Holdings Ltd. | | | 16,000 | | | | 9,406 | |
| | | | | | | 392,393 | |
|
Specialty Retail – 0.4% | |
| | |
Chow Tai Fook Jewellery Group Ltd. | | | 6,800 | | | | 9,594 | |
| | |
Lojas Renner SA | | | 3,400 | | | | 8,266 | |
| | | | | | | 17,860 | |
|
Technology Hardware, Storage & Peripherals – 5.0% | |
| | |
Asustek Computer, Inc. | | | 2,422 | | | | 25,239 | |
| | |
Compal Electronics, Inc. | | | 14,652 | | | | 12,671 | |
| | |
Lenovo Group Ltd. | | | 24,000 | | | | 27,912 | |
| | |
Micro-Star International Co. Ltd. | | | 798 | | | | 4,060 | |
| | |
Samsung Electronics Co. Ltd. | | | 2,380 | | | | 117,894 | |
| | |
Wistron Corp. | | | 7,546 | | | | 20,799 | |
| | | | | | | 208,575 | |
|
Textiles, Apparel & Luxury Goods – 1.0% | |
| | |
Feng TAY Enterprise Co. Ltd. | | | 1,702 | | | | 9,367 | |
| | |
Li Ning Co. Ltd. | | | 3,500 | | | | 10,735 | |
| | |
LPP SA | | | 4 | | | | 12,871 | |
| | |
Page Industries Ltd. | | | 20 | | | | 9,084 | |
| | | | | | | 42,057 | |
|
Transportation Infrastructure – 1.3% | |
| | |
Abu Dhabi Ports Co. PJSC* | | | 3,350 | | | | 5,445 | |
| | |
Adani Ports & Special Economic Zone Ltd. | | | 1,866 | | | | 17,588 | |
| | |
CCR SA | | | 3,400 | | | | 8,077 | |
| | |
Grupo Aeroportuario del Pacifico SAB de CV, Class B | | | 230 | | | | 2,679 | |
| | |
International Container Terminal Services, Inc. | | | 3,280 | | | | 11,631 | |
| | |
Salik Co. PJSC | | | 5,562 | | | | 4,830 | |
| | |
Taiwan High Speed Rail Corp. | | | 5,090 | | | | 4,614 | |
| | | | | | | 54,864 | |
|
Wireless Telecommunication Services – 2.6% | |
| | |
Advanced Info Service PCL, NVDR | | | 1,400 | | | | 8,569 | |
| | |
Bharti Airtel Ltd. | | | 4,862 | | | | 53,398 | |
| | |
Etihad Etisalat Co. | | | 1,296 | | | | 15,925 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 319 | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Mobile Telecommunications Co. KSCP | | | 6,340 | | | $ | 9,851 | |
| | |
Taiwan Mobile Co. Ltd. | | | 4,448 | | | | 13,138 | |
| | |
TIM SA | | | 2,000 | | | | 6,016 | |
| | |
Vodacom Group Ltd. | | | 388 | | | | 2,100 | |
| | | | | | | 108,997 | |
Total Common Stocks (Cost $4,738,015) | | | | 4,152,508 | |
| | | | | | | | |
Total Investments – 98.9% (Cost $4,738,015) | | | | 4,152,508 | |
| |
Other assets less liabilities – 1.1% | | | | 47,529 | |
NET ASSETS – 100.0% | | | $ | 4,200,037 | |
* | Non-income producing security. |
(a) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(c) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
NVDR – Non-Voting Depositary Receipt
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 193,052 | |
Aggregate gross unrealized depreciation | | | (802,558 | ) |
Net unrealized depreciation | | $ | (609,506 | ) |
Federal income tax cost | | $ | 4,758,505 | |
Futures Contracts
FlexShares® ESG & Climate Emerging Markets Core Index Fund had the following open futures contract as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | | | | | | | | | | | | | | | | |
MSCI Emerging Markets E-Mini Index | | | 1 | | | | 12/15/2023 | | | | USD | | | $ | 45,960 | | | $ | (3,512 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® ESG & Climate Emerging Markets Core Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 4,758 | | | | | Toronto-Dominion Bank (The) | | HKD | | | 37,178 | | | | 12/20/2023 | | | $ | 3 | |
Net unrealized appreciation | | | | | | | $ | 3 | |
Abbreviations:
HKD – Hong Kong Dollar
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | |
320 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund (cont.)
FlexShares® ESG & Climate Emerging Markets Core Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Brazil | | | 6.0 | % |
Chile | | | 0.7 | |
China | | | 23.8 | |
Colombia | | | 0.4 | |
Czech Republic | | | 0.1 | |
Egypt | | | 0.4 | |
Greece | | | 0.7 | |
Hungary | | | 0.8 | |
India | | | 14.6 | |
Indonesia | | | 1.0 | |
Kuwait | | | 0.2 | |
Malaysia | | | 2.2 | |
Mexico | | | 2.3 | |
Philippines | | | 0.3 | |
Poland | | | 1.6 | |
Saudi Arabia | | | 2.3 | |
South Africa | | | 5.0 | |
South Korea | | | 12.6 | |
Taiwan | | | 16.9 | |
Thailand | | | 3.5 | |
Turkey | | | 0.7 | |
United Arab Emirates | | | 2.8 | |
Other1 | | | 1.1 | |
| | | 100.0 | % |
1 | Includes any non-equity securities and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.9 | % |
Others(1) | | | 1.1 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 321 | |
Schedule of Investments
FlexShares® Morningstar Global Upstream Natural Resources Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.6% | |
|
Building Products – 0.5% | |
| | |
Simpson Manufacturing Co., Inc. | | | 132,904 | | | $ | 17,700,155 | |
| | |
UFP Industries, Inc. | | | 190,376 | | | | 18,118,084 | |
| | | | | | | 35,818,239 | |
|
Chemicals – 16.0% | |
| | |
CF Industries Holdings, Inc. | | | 1,293,120 | | | | 103,165,114 | |
| | |
Corteva, Inc. | | | 4,949,776 | | | | 238,282,217 | |
| | |
FMC Corp. | | | 915,960 | | | | 48,729,072 | |
| | |
ICL Group Ltd. | | | 8,211,312 | | | | 39,782,407 | |
| | |
K+S AG (Registered) | | | 2,140,832 | | | | 35,911,579 | |
| | |
Mosaic Co. (The) | | | 2,356,352 | | | | 76,534,313 | |
| | |
Nutrien Ltd.(a) | | | 5,635,848 | | | | 302,364,818 | |
| | |
PhosAgro PJSC‡ | | | 308,581 | | | | — | |
| | |
PI Industries Ltd. | | | 926,736 | | | | 37,858,613 | |
| | |
Qinghai Salt Lake Industry Co. Ltd., Class A* | | | 5,028,800 | | | | 11,633,837 | |
| | |
SABIC Agri-Nutrients Co. | | | 2,607,792 | | | | 93,006,336 | |
| | |
Scotts Miracle-Gro Co. (The)(a) | | | 305,320 | | | | 13,568,421 | |
| | |
UPL Ltd. | | | 5,840,592 | | | | 37,916,014 | |
| | |
Yara International ASA | | | 1,785,224 | | | | 58,326,554 | |
| | |
Yunnan Yuntianhua Co. Ltd., Class A | | | 1,796,000 | | | | 4,086,225 | |
| | |
Zangge Mining Co. Ltd., Class A | | | 1,436,800 | | | | 4,395,943 | |
| | | | | | | 1,105,561,463 | |
|
Electric Utilities – 0.2% | |
| | |
Origin Energy Ltd. | | | 2,410,232 | | | | 13,932,730 | |
|
Food Products – 12.7% | |
| | |
Archer-Daniels-Midland Co. | | | 3,879,360 | | | | 277,645,795 | |
| | |
Bakkafrost P/F | | | 581,904 | | | | 26,225,970 | |
| | |
Bunge Ltd. | | | 1,081,192 | | | | 114,584,728 | |
| | |
Cal-Maine Foods, Inc.(a) | | | 272,992 | | | | 12,369,268 | |
| | |
Charoen Pokphand Foods PCL, NVDR | | | 38,434,400 | | | | 19,996,474 | |
| | |
Charoen Pokphand Indonesia Tbk. PT* | | | 84,052,800 | | | | 30,689,722 | |
| | |
Kuala Lumpur Kepong Bhd. | | | 6,465,600 | | | | 29,827,660 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Food Products – (continued) | |
| | |
Mowi ASA | | | 5,283,832 | | | $ | 85,748,699 | |
| | |
Muyuan Foods Co. Ltd., Class A | | | 5,028,808 | | | | 25,947,690 | |
| | |
New Hope Liuhe Co. Ltd., Class A* | | | 3,951,200 | | | | 5,485,603 | |
| | |
PPB Group Bhd. | | | 8,261,600 | | | | 26,321,983 | |
| | |
Salmar ASA | | | 757,912 | | | | 35,874,922 | |
| | |
Tyson Foods, Inc., Class A | | | 2,058,216 | | | | 95,398,312 | |
| | |
Wilmar International Ltd. | | | 36,638,400 | | | | 95,202,879 | |
| | | | | | | 881,319,705 | |
|
Metals & Mining – 29.0% | |
| | |
Agnico Eagle Mines Ltd.(a) | | | 1,623,584 | | | | 76,065,481 | |
| | |
Anglo American plc(a) | | | 4,335,544 | | | | 110,296,150 | |
| | |
Anglogold Ashanti plc | | | 1,372,144 | | | | 25,215,028 | |
| | |
Barrick Gold Corp.(a) | | | 5,700,504 | | | | 90,953,476 | |
| | |
BHP Group Ltd. | | | 12,518,120 | | | | 352,700,223 | |
| | |
Boliden AB | | | 862,080 | | | | 22,048,427 | |
| | |
First Quantum Minerals Ltd.(a) | | | 1,849,880 | | | | 21,413,702 | |
| | |
Fortescue Metals Group Ltd.(a) | | | 5,743,608 | | | | 81,095,409 | |
| | |
Franco-Nevada Corp. | | | 621,416 | | | | 75,514,410 | |
| | |
Freeport-McMoRan, Inc.(a) | | | 3,516,568 | | | | 118,789,667 | |
| | |
Glencore plc | | | 31,850,264 | | | | 168,179,831 | |
| | |
Gold Fields Ltd. | | | 2,963,400 | | | | 39,276,680 | |
| | |
Grupo Mexico SAB de CV, Series B | | | 10,057,600 | | | | 40,964,678 | |
| | |
Hindalco Industries Ltd. | | | 4,443,304 | | | | 24,522,326 | |
| | |
Impala Platinum Holdings Ltd. | | | 3,150,184 | | | | 13,053,160 | |
| | |
Mineral Resources Ltd.(a) | | | 545,984 | | | | 19,967,041 | |
| | |
MMC Norilsk Nickel PJSC* ‡ | | | 1,277,631 | | | | — | |
| | |
Newmont Corp.(a) | | | 2,022,296 | | | | 75,775,431 | |
| | |
Norsk Hydro ASA | | | 4,141,576 | | | | 23,607,469 | |
| | |
Northern Star Resources Ltd. | | | 4,001,488 | | | | 29,617,108 | |
| | |
Rio Tinto plc | | | 3,354,928 | | | | 213,933,015 | |
| | |
Royal Gold, Inc.(a) | | | 168,824 | | | | 17,613,408 | |
| | |
Saudi Arabian Mining Co.* | | | 4,069,736 | | | | 39,052,803 | |
| | |
South32 Ltd. | | | 14,414,696 | | | | 30,300,527 | |
| | |
Sumitomo Metal Mining Co. Ltd. | | | 843,700 | | | | 23,487,333 | |
See Accompanying Notes to the Financial Statements.
| | | | |
322 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Teck Resources Ltd., Class B(a) | | | 1,436,800 | | | $ | 50,713,632 | |
| | |
Vale SA | | | 11,135,200 | | | | 152,355,503 | |
| | |
Wheaton Precious Metals Corp.(a) | | | 1,494,272 | | | | 63,043,048 | |
| | |
Zijin Mining Group Co. Ltd., Class A | | | 5,028,800 | | | | 8,548,431 | |
| | | | | | | 2,008,103,397 | |
|
Oil, Gas & Consumable Fuels – 31.3% | |
| | |
APA Corp. | | | 262,216 | | | | 10,415,220 | |
| | |
BP plc | | | 23,484,496 | | | | 143,227,238 | |
| | |
Cameco Corp.(a) | | | 1,375,736 | | | | 56,218,623 | |
| | |
Canadian Natural Resources Ltd.(a) | | | 1,451,168 | | | | 92,051,038 | |
| | |
Cenovus Energy, Inc.(a) | | | 1,792,408 | | | | 34,111,593 | |
| | |
Chevron Corp. | | | 1,451,168 | | | | 211,478,713 | |
| | |
China Petroleum & Chemical Corp., Class H | | | 32,668,000 | | | | 16,700,151 | |
| | |
ConocoPhillips | | | 987,800 | | | | 117,350,640 | |
| | |
Coterra Energy, Inc. | | | 650,152 | | | | 17,879,180 | |
| | |
Devon Energy Corp. | | | 520,840 | | | | 24,255,519 | |
| | |
Diamondback Energy, Inc.(a) | | | 147,272 | | | | 23,610,647 | |
| | |
Eni SpA | | | 3,265,128 | | | | 53,245,736 | |
| | |
EOG Resources, Inc. | | | 477,736 | | | | 60,314,170 | |
| | |
EQT Corp. | | | 316,096 | | | | 13,396,149 | |
| | |
Equinor ASA | | | 1,368,552 | | | | 45,870,753 | |
| | |
Exxon Mobil Corp.(a) | | | 3,211,248 | | | | 339,910,601 | |
| | |
Gazprom PJSC* ‡ | | | 15,937,700 | | | | — | |
| | |
Hess Corp. | | | 229,888 | | | | 33,195,827 | |
| | |
Inpex Corp. | | | 1,351,700 | | | | 19,479,582 | |
| | |
LUKOIL PJSC‡ | | | 483,340 | | | | — | |
| | |
Marathon Oil Corp. | | | 517,248 | | | | 14,126,043 | |
| | |
Novatek PJSC‡ | | | 1,237,715 | | | | — | |
| | |
Occidental Petroleum Corp.(a) | | | 585,496 | | | | 36,189,508 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 5,747,200 | | | | 39,591,062 | |
| | |
Pioneer Natural Resources Co. | | | 193,968 | | | | 46,358,352 | |
| | |
Repsol SA | | | 1,745,712 | | | | 25,510,133 | |
| | |
Rosneft Oil Co. PJSC‡ | | | 2,926,433 | | | | — | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Santos Ltd. | | | 4,278,072 | | | $ | 20,775,432 | |
| | |
Saudi Arabian Oil Co.(b) | | | 3,308,232 | | | | 29,364,571 | |
| | |
Shell plc | | | 9,389,488 | | | | 301,533,590 | |
| | |
Suncor Energy, Inc.(a) | | | 1,720,568 | | | | 55,660,514 | |
| | |
Tatneft PJSC‡ | | | 2,021,036 | | | | — | |
| | |
TotalEnergies SE | | | 3,114,264 | | | | 208,040,310 | |
| | |
Tourmaline Oil Corp.(a) | | | 420,264 | | | | 22,199,142 | |
| | |
Woodside Energy Group Ltd. | | | 2,496,441 | | | | 54,152,089 | |
| | | | | | | 2,166,212,126 | |
|
Paper & Forest Products – 3.3% | |
| | |
Canfor Corp.* (a) | | | 280,176 | | | | 2,861,801 | |
| | |
Dexco SA* | | | 1,436,800 | | | | 1,954,481 | |
| | |
Dongwha Enterprise Co. Ltd.* | | | 21,552 | | | | 981,414 | |
| | |
Interfor Corp.* (a) | | | 237,072 | | | | 2,921,881 | |
| | |
Mondi plc(a) | | | 2,198,304 | | | | 35,451,500 | |
| | |
Stella-Jones, Inc.(a) | | | 233,480 | | | | 12,216,811 | |
| | |
Stora Enso OYJ, Class R | | | 2,747,880 | | | | 32,893,566 | |
| | |
Svenska Cellulosa AB SCA, Class B(a) | | | 2,676,040 | | | | 36,634,131 | |
| | |
UPM-Kymmene OYJ(a) | | | 2,449,744 | | | | 82,264,584 | |
| | |
West Fraser Timber Co. Ltd.(a) | | | 272,992 | | | | 18,403,977 | |
| | | | | | | 226,584,146 | |
|
Semiconductors & Semiconductor Equipment – 0.2% | |
| | |
Tongwei Co. Ltd., Class A | | | 3,951,206 | | | | 14,739,881 | |
|
Specialized REITs – 1.2% | |
| | |
PotlatchDeltic Corp., REIT | | | 244,256 | | | | 10,466,370 | |
| | |
Rayonier, Inc., REIT(a) | | | 449,000 | | | | 11,332,760 | |
| | |
Weyerhaeuser Co., REIT | | | 2,234,224 | | | | 64,099,886 | |
| | | | | | | 85,899,016 | |
|
Water Utilities – 5.2% | |
| | |
American States Water Co. | | | 154,456 | | | | 12,055,291 | |
| | |
American Water Works Co., Inc. | | | 818,976 | | | | 96,352,526 | |
| | |
Beijing Enterprises Water Group Ltd. | | | 28,736,000 | | | | 6,059,658 | |
| | |
California Water Service Group(a) | | | 244,256 | | | | 11,890,382 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 323 | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Water Utilities – (continued) | |
| | |
China Water Affairs Group Ltd. | | | 7,184,000 | | | $ | 4,544,744 | |
| | |
Cia de Saneamento Basico do Estado de Sao Paulo SABESP | | | 2,291,733 | | | | 26,525,571 | |
| | |
Cia de Saneamento de Minas Gerais Copasa MG | | | 1,436,800 | | | | 4,541,462 | |
| | |
Cia de Saneamento do Parana | | | 1,796,000 | | | | 7,745,985 | |
| | |
Essential Utilities, Inc. | | | 1,038,088 | | | | 34,734,424 | |
| | |
Grandblue Environment Co. Ltd., Class A | | | 359,200 | | | | 873,200 | |
| | |
Guangdong Investment Ltd. | | | 18,867,941 | | | | 12,876,672 | |
| | |
Pennon Group plc | | | 1,846,288 | | | | 16,276,348 | |
| | |
Severn Trent plc(a) | | | 1,745,712 | | | | 56,262,957 | |
| | |
SJW Group(a) | | | 118,536 | | | | 7,406,129 | |
| | |
United Utilities Group plc | | | 4,734,256 | | | | 61,067,043 | |
| | | | | | | 359,212,392 | |
Total Common Stocks (Cost $6,639,775,626) | | | | 6,897,383,095 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 4.4%(c) | |
|
CERTIFICATES OF DEPOSIT – 0.9% | |
| | |
Barclays Bank plc, New York | | | | | | | | |
(SOFR + 0.32%), 5.48%, 11/24/2023(d) | | $ | 4,000,000 | | | | 4,000,373 | |
| | |
Citibank NA, New York | | | | | | | | |
(SOFR + 0.40%), 5.62%, 12/15/2023(d) | | | 5,000,000 | | | | 5,000,540 | |
| | |
Credit Industriel et Commercial, London | | | | | | | | |
5.69%, 1/16/2024 | | | 4,000,000 | | | | 3,952,360 | |
| | |
Mizuho Bank Ltd., New York | | | | | | | | |
(SOFR + 0.40%), 5.71%, 3/12/2024(d) | | | 4,000,000 | | | | 4,001,152 | |
| | |
MUFG Bank Ltd., London Branch | | | | | | | | |
5.63%, 11/27/2023 | | | 5,000,000 | | | | 5,000,000 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CERTIFICATES OF DEPOSIT – (continued) | |
| | |
National Westminster Bank PLC | | | | | | | | |
5.88%, 5/2/2024 | | $ | 4,000,000 | | | $ | 4,002,680 | |
| | |
Nordea Bank Abp, New York Branch | | | | | | | | |
(SOFR + 0.47%), 5.78%, 4/26/2024(d) | | | 4,000,000 | �� | | | 4,003,104 | |
| | |
Oversea-Chinese Banking Corp. Ltd., New York | | | | | | | | |
(SOFR + 0.37%), 5.68%, 11/16/2023(d) | | | 3,000,000 | | | | 3,000,000 | |
| | |
Royal Bank of Canada, New York | | | | | | | | |
(SOFR + 0.53%), 5.84%, 5/23/2024(d) | | | 4,000,000 | | | | 4,003,616 | |
| | |
Sumitomo Mitsui Trust Bank Ltd., New York | | | | | | | | |
(SOFR + 0.23%), 5.54%, 11/22/2023(d) | | | 5,000,000 | | | | 5,000,000 | |
| | |
Svenska Handelsbanken, New York | | | | | | | | |
5.80%, 4/4/2024 | | | 3,000,000 | | | | 2,999,646 | |
(SOFR + 0.33%), 5.64%, 4/4/2024(d) | | | 3,000,000 | | | | 2,999,610 | |
| | |
The Sumitomo Bank Ltd., New York | | | | | | | | |
(SOFR + 0.47%), 5.60%, 1/9/2024(d) | | | 3,000,000 | | | | 3,001,839 | |
| | |
Toronto-Dominion Bank, New York | | | | | | | | |
5.64%, 2/28/2024 | | | 2,000,000 | | | | 2,000,000 | |
(US Federal Funds Effective Rate (continuous series) + 0.61%), 5.94%, 7/26/2024(d) | | | 4,000,000 | | | | 4,001,992 | |
| | |
Wells Fargo Bank (San Francisco) NA | | | | | | | | |
(SOFR + 0.37%), 5.62%, 12/12/2023(d) | | | 4,000,000 | | | | 4,000,290 | |
Total Certificates of Deposit (Cost $60,955,805) | | | | 60,967,202 | |
| | |
| | | | | | | | |
See Accompanying Notes to the Financial Statements.
| | | | |
324 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
COMMERCIAL PAPER – 0.0%(d) (e) | |
| | |
Bank of Montreal, Montreal | | | | | | | | |
(SOFR + 0.35%), 5.66%, 11/9/2023 (Cost $2,000,000) | | $ | 2,000,000 | | | $ | 2,000,000 | |
|
INVESTMENT COMPANIES – 1.1% | |
| | |
BlackRock Liquidity FedFund, Institutional Shares | | | | | | | | |
5.35%, 11/1/2023 | | | 12,000,000 | | | | 12,000,000 | |
| | |
Dreyfus Treasury Obligations Cash Management Fund | | | | | | | | |
5.38%, 11/1/2023 | | | 5,000,000 | | | | 5,000,000 | |
| | |
Goldman Sachs Financial Square Government Fund, Institutional Class | | | | | | | | |
5.36%, 11/1/2023 | | | 12,000,000 | | | | 12,000,000 | |
| | |
Invesco Government & Agency Portfolio, Institutional Shares | | | | | | | | |
5.36%, 11/1/2023 | | | 12,000,000 | | | | 12,000,000 | |
| | |
Morgan Stanley Institutional Liquidity Fund – Government Portfolio | | | | | | | | |
5.35%, 11/1/2023 | | | 12,000,000 | | | | 12,000,000 | |
| | |
RBC BlueBay U.S. Government Money Market Fund | | | | | | | | |
5.40%, 11/1/2023 | | | 10,000,000 | | | | 10,000,000 | |
| | |
State Street Institutional U.S. Government Money Market Fund | | | | | | | | |
5.36%, 11/1/2023 | | | 15,000,000 | | | | 15,000,000 | |
Total Investment Companies (Cost $78,000,000) | | | | 78,000,000 | |
| | |
| | | | | | | | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
REPURCHASE AGREEMENTS – 2.4% | |
| | |
BofA Securities, Inc., 5.77%, dated 10/31/2023, due 1/31/2024, repurchase price $8,117,964, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 6.13%, maturing 7/15/2024 – 11/15/2044; total market value $8,056,513 | | $ | 8,000,000 | | | $ | 8,000,000 | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $14,002,061, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $14,117,590 | | | 14,000,000 | | | | 14,000,000 | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $63,805,340, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $64,521,419 | | | 63,795,983 | | | | 63,795,983 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 325 | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
REPURCHASE AGREEMENTS – (continued) | |
| | |
MetLife, Inc., 5.32%, dated 10/31/2023, due 11/1/2023, repurchase price $57,008,423, collateralized by various U.S. Treasury Securities, 0.00%, maturing 8/15/2041 – 11/15/2050; total market value $57,411,277 | | $ | 57,000,000 | | | $ | 57,000,000 | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $20,003,011, collateralized by various Common Stocks; total market value $22,150,189 | | | 20,000,000 | | | | 20,000,000 | |
Total Repurchase Agreements (Cost $162,795,983) | | | | 162,795,983 | |
Total Securities Lending Reinvestments (Cost $303,751,788) | | | | 303,763,185 | |
Total Investments – 104.0% (Cost $6,943,527,414) | | | | 7,201,146,280 | |
| |
Liabilities in excess of other assets – (4.0%) | | | | (275,860,232 | ) |
NET ASSETS – 100.0% | | | $ | 6,925,286,048 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $491,197,028, collateralized in the form of cash with a value of $303,760,945 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $142,895,385 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 15, 2023 – August 15, 2053 and $71,411,383 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $518,067,713. |
(b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(c) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $303,763,185. |
(d) | Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2023. |
(e) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
Abbreviations
NVDR – Non-Voting Depositary Receipt
OYJ – Public Limited Company
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA – Limited partnership with share capital
SOFR – Secured Overnight Financing Rate
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 957,259,179 | |
Aggregate gross unrealized depreciation | | | (741,008,669 | ) |
Net unrealized appreciation | | $ | 216,250,510 | |
Federal income tax cost | | $ | 6,983,135,662 | |
See Accompanying Notes to the Financial Statements.
| | | | |
326 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
Futures Contracts
FlexShares® Morningstar Global Upstream Natural Resources Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | |
FTSE 100 Index | | | 68 | | | | 12/15/2023 | | | | GBP | | | $ | 6,046,670 | | | $ | (224,041 | ) |
Hang Seng Index | | | 4 | | | | 11/29/2023 | | | | HKD | | | | 438,208 | | | | (7,045 | ) |
Russell 2000 E-Mini Index | | | 30 | | | | 12/15/2023 | | | | USD | | | | 2,502,600 | | | | (278,542 | ) |
S&P Midcap 400 E-Mini Index | | | 10 | | | | 12/15/2023 | | | | USD | | | | 2,375,100 | | | | (201,564 | ) |
S&P/TSX 60 Index | | | 100 | | | | 12/14/2023 | | | | CAD | | | | 16,351,522 | | | | (1,009,428 | ) |
SPI 200 Index | | | 4 | | | | 12/21/2023 | | | | AUD | | | | 429,465 | | | | (17,488 | ) |
| | | | | | | | | | | | | | | | | | $ | (1,738,108 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® Morningstar Global Upstream Natural Resources Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 1,614,828 | | | | | Toronto-Dominion Bank (The) | | AUD | | | 2,500,000 | | | | 12/20/2023 | | | $ | 29,337 | |
USD | | | 5,289,826 | | | | | JPMorgan Chase Bank NA | | BRL* | | | 26,260,760 | | | | 12/20/2023 | | | | 111,945 | |
USD | | | 1,308,293 | | | | | Morgan Stanley | | CAD | | | 1,764,000 | | | | 12/20/2023 | | | | 36,539 | |
USD | | | 19,040,673 | | | | | Toronto-Dominion Bank (The) | | CAD | | | 25,714,000 | | | | 12/20/2023 | | | | 502,192 | |
USD | | | 1,741,742 | | | | | Bank of Montreal | | EUR | | | 1,630,000 | | | | 12/20/2023 | | | | 14,861 | |
USD | | | 616,190 | | | | | JPMorgan Chase Bank NA | | EUR | | | 575,000 | | | | 12/20/2023 | | | | 7,015 | |
USD | | | 4,584,575 | | | | | JPMorgan Chase Bank NA | | GBP | | | 3,700,000 | | | | 12/20/2023 | | | | 93,051 | |
USD | | | 2,409,267 | | | | | BNP Paribas SA | | HKD | | | 18,824,345 | | | | 12/20/2023 | | | | 1,519 | |
USD | | | 265,044 | | | | | Citibank NA | | KRW* | | | 350,052,156 | | | | 12/20/2023 | | | | 5,128 | |
USD | | | 145,914 | | | | | Citibank NA | | SEK | | | 1,620,827 | | | | 12/20/2023 | | | | 487 | |
ZAR | | | 5,390,000 | | | | | BNP Paribas SA | | USD | | | 282,476 | | | | 12/20/2023 | | | | 3,815 | |
Total unrealized appreciation | | | | | | | $ | 805,889 | |
AUD | | | 2,531,480 | | | | | Citibank NA | | USD | | | 1,639,847 | | | | 12/20/2023 | | | $ | (34,392 | ) |
CAD | | | 8,965,539 | | | | | Citibank NA | | USD | | | 6,626,059 | | | | 12/20/2023 | | | | (162,363 | ) |
CAD | | | 20,500,000 | | | | | JPMorgan Chase Bank NA | | USD | | | 15,185,061 | | | | 12/20/2023 | | | | (405,608 | ) |
EUR | | | 724,602 | | | | | Toronto-Dominion Bank (The) | | USD | | | 776,532 | | | | 12/20/2023 | | | | (8,862 | ) |
GBP | | | 8,174,860 | | | | | Toronto-Dominion Bank (The) | | USD | | | 10,089,741 | | | | 12/20/2023 | | | | (166,070 | ) |
HKD | | | 7,000,000 | | | | | Goldman Sachs & Co. | | USD | | | 896,488 | | | | 12/20/2023 | | | | (1,145 | ) |
INR* | | | 56,105,711 | | | | | Citibank NA | | USD | | | 673,622 | | | | 12/20/2023 | | | | (635 | ) |
JPY | | | 9,759,416 | | | | | Toronto-Dominion Bank (The) | | USD | | | 67,125 | | | | 12/20/2023 | | | | (2,141 | ) |
NOK | | | 11,741,048 | | | | | Goldman Sachs & Co. | | USD | | | 1,095,008 | | | | 12/20/2023 | | | | (42,519 | ) |
USD | | | 870,571 | | | | | Toronto-Dominion Bank (The) | | NOK | | | 9,758,000 | | | | 12/20/2023 | | | | (4,154 | ) |
Total unrealized depreciation | | | | | | | $ | (827,889 | ) |
Net unrealized depreciation | | | | | | | $ | (22,000 | ) |
* | Non-deliverable forward. See Note 2 in the Notes to Financial Statements. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 327 | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)
Abbreviations:
AUD – Australian Dollar
BRL – Brazilian Real
CAD – Canadian Dollar
EUR – Euro
GBP – British Pound
HKD – Hong Kong Dollar
INR – Indian Rupee
JPY – Japanese Yen
KRW – Korean Won
NOK – Norwegian Krone
SEK – Swedish Krona
USD – US Dollar
ZAR – South African Rand
FlexShares® Morningstar Global Upstream Natural Resources Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 8.7 | % |
Brazil | | | 3.4 | |
Canada | | | 14.1 | |
China | | | 1.7 | |
Finland | | | 1.7 | |
France | | | 3.0 | |
Germany | | | 0.5 | |
India | | | 1.4 | |
Indonesia | | | 0.4 | |
Israel | | | 0.6 | |
Italy | | | 0.8 | |
Japan | | | 0.6 | |
Malaysia | | | 0.8 | |
Mexico | | | 0.6 | |
Norway | | | 4.0 | |
Saudi Arabia | | | 2.3 | |
Singapore | | | 1.4 | |
South Africa | | | 1.1 | |
South Korea | | | 0.0 | † |
Spain | | | 0.4 | |
Sweden | | | 0.8 | |
Thailand | | | 0.3 | |
United Kingdom | | | 16.0 | |
United States | | | 35.0 | |
Other1 | | | 0.4 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.6 | % |
Securities Lending Reinvestments | | | 4.4 | |
Others(1) | | | (4.0 | ) |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
328 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® STOXX® Global Broad Infrastructure Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.1% | |
|
Air Freight & Logistics – 2.6% | |
| | |
bpost SA(a) | | | 152,640 | | | $ | 826,063 | |
| | |
CTT-Correios de Portugal SA(a) | | | 119,568 | | | | 455,612 | |
| | |
Deutsche Post AG | | | 1,213,488 | | | | 47,150,465 | |
| | |
International Distributions Services plc* | | | 870,048 | | | | 2,666,849 | |
| | |
Oesterreichische Post AG(a) | | | 39,856 | | | | 1,270,153 | |
| | |
PostNL NV(a) | | | 423,153 | | | | 786,529 | |
| | | | | | | 53,155,671 | |
|
Commercial Services & Supplies – 4.7% | |
| | |
Ambipar Participacoes e Empreendimentos SA | | | 84,800 | | | | 229,530 | |
| | |
Befesa SA(a) (b) | | | 44,096 | | | | 1,283,625 | |
| | |
Better World Green PCL, NVDR* | | | 3,823,600 | | | | 55,318 | |
| | |
Casella Waste Systems, Inc., Class A* (a) | | | 22,048 | | | | 1,663,522 | |
| | |
China Everbright Environment Group Ltd. | | | 4,240,000 | | | | 1,446,822 | |
| | |
Clean Harbors, Inc.* (a) | | | 19,504 | | | | 2,997,180 | |
| | |
Cleanaway Co. Ltd. | | | 112,000 | | | | 597,379 | |
| | |
Cleanaway Waste Management Ltd.(a) | | | 2,724,624 | | | | 3,864,214 | |
| | |
CoreCivic, Inc.* (a) | | | 50,032 | | | | 635,406 | |
| | |
Daiseki Co. Ltd.(a) | | | 63,460 | | | | 1,732,689 | |
| | |
GEO Group, Inc. (The)*(a) | | | 47,488 | | | | 415,045 | |
| | |
Insun ENT Co. Ltd.* | | | 29,138 | | | | 154,261 | |
| | |
Midac Holdings Co. Ltd.(a) | | | 21,400 | | | | 247,002 | |
| | |
Renewi plc* | | | 102,608 | | | | 730,872 | |
| | |
Republic Services, Inc., Class A | | | 81,408 | | | | 12,088,274 | |
| | |
Shanghai Youngsun Investment Co. Ltd., Class B* ‡ | | | 57,800 | | | | — | |
| | |
Stericycle, Inc.* (a) | | | 38,160 | | | | 1,573,718 | |
| | |
Sunny Friend Environmental Technology Co. Ltd. | | | 120,315 | | | | 383,925 | |
| | |
TRE Holdings Corp.(a) | | | 84,800 | | | | 654,009 | |
| | |
Waste Connections, Inc.(a) | | | 317,152 | | | | 41,021,295 | |
| | |
Waste Management, Inc. | | | 145,008 | | | | 23,829,165 | |
| | | | | | | 95,603,251 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Diversified Telecommunication Services – 14.7% | |
| | |
AT&T, Inc. | | | 2,816,208 | | | $ | 43,369,603 | |
| | |
BCE, Inc.(a) | | | 711,472 | | | | 26,383,273 | |
| | |
BT Group plc(a) | | | 4,924,336 | | | | 6,737,304 | |
| | |
Cellnex Telecom SA(b) | | | 375,664 | | | | 11,006,970 | |
| | |
China Tower Corp. Ltd., Class H(b) | | | 33,920,000 | | | | 3,164,584 | |
| | |
Deutsche Telekom AG (Registered) | | | 2,696,640 | | | | 58,360,885 | |
| | |
Frontier Communications Parent, Inc.* (a) | | | 96,672 | | | | 1,732,362 | |
| | |
HKT Trust & HKT Ltd. | | | 2,986,000 | | | | 3,091,097 | |
| | |
Infrastrutture Wireless Italiane SpA(b) | | | 281,536 | | | | 3,071,062 | |
| | |
Iridium Communications, Inc. | | | 44,096 | | | | 1,633,757 | |
| | |
KINX, Inc. | | | 2,595 | | | | 163,322 | |
| | |
Koninklijke KPN NV | | | 2,636,432 | | | | 8,847,800 | |
| | |
Liberty Global plc, Class C* (a) | | | 95,824 | | | | 1,625,175 | |
| | |
Nippon Telegraph & Telephone Corp. | | | 42,060,800 | | | | 49,102,641 | |
| | |
Quebecor, Inc., Class B(a) | | | 128,896 | | | | 2,656,376 | |
| | |
Sarana Menara Nusantara Tbk. PT | | | 16,196,800 | | | | 907,470 | |
| | |
Spark New Zealand Ltd. | | | 1,436,512 | | | | 4,152,670 | |
| | |
Swisscom AG (Registered) | | | 19,504 | | | | 11,658,894 | |
| | |
Telecom Italia SpA* (a) | | | 7,898,272 | | | | 2,037,862 | |
| | |
Verizon Communications, Inc. | | | 1,654,448 | | | | 58,120,758 | |
| | | | | | | 297,823,865 | |
|
Electric Utilities – 14.1% | |
| | |
American Electric Power Co., Inc. | | | 202,672 | | | | 15,309,843 | |
| | |
Constellation Energy Corp. | | | 126,352 | | | | 14,267,668 | |
| | |
Duke Energy Corp. | | | 303,584 | | | | 26,985,582 | |
| | |
Edison International | | | 150,944 | | | | 9,518,529 | |
| | |
Enel SpA | | | 6,286,224 | | | | 39,787,498 | |
| | |
Eversource Energy | | | 134,832 | | | | 7,252,613 | |
| | |
Exelon Corp. | | | 391,776 | | | | 15,255,757 | |
| | |
Iberdrola SA | | | 4,692,832 | | | | 52,083,396 | |
| | |
NextEra Energy, Inc. | | | 796,272 | | | | 46,422,658 | |
| | |
PG&E Corp.* (a) | | | 1,010,816 | | | | 16,476,301 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 329 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electric Utilities – (continued) | |
| | |
Southern Co. (The) | | | 429,088 | | | $ | 28,877,622 | |
| | |
Xcel Energy, Inc.(a) | | | 217,088 | | | | 12,866,806 | |
| | | | | | | 285,104,273 | |
|
Energy Equipment & Services – 0.1% | |
| | |
Secure Energy Services, Inc. | | | 232,352 | | | | 1,288,752 | |
|
Gas Utilities – 1.1% | |
| | |
AltaGas Ltd.(a) | | | 228,112 | | | | 4,232,786 | |
| | |
APA Group | | | 859,872 | | | | 4,486,086 | |
| | |
Enagas SA(a) | | | 190,800 | | | | 3,185,466 | |
| | |
Keppel Infrastructure Trust | | | 4,748,800 | | | | 1,525,106 | |
| | |
Petronas Gas Bhd. | | | 424,000 | | | | 1,530,654 | |
| | |
Snam SpA | | | 1,662,928 | | | | 7,610,906 | |
| | | | | | | 22,571,004 | |
|
Ground Transportation – 17.8% | |
| | |
Aurizon Holdings Ltd.(a) | | | 2,266,704 | | | | 4,908,260 | |
| | |
Canadian National Railway Co.(a) | | | 739,456 | | | | 78,156,225 | |
| | |
Canadian Pacific Kansas City Ltd.(a) | | | 1,146,496 | | | | 81,318,686 | |
| | |
Central Japan Railway Co. | | | 1,272,000 | | | | 28,523,305 | |
| | |
CSX Corp. | | | 788,640 | | | | 23,540,904 | |
| | |
East Japan Railway Co. | | | 463,300 | | | | 24,081,994 | |
| | |
GMexico Transportes SAB de CV(a) (b) | | | 1,017,600 | | | | 2,095,738 | |
| | |
Keio Corp.(a) | | | 169,600 | | | | 5,005,857 | |
| | |
Keisei Electric Railway Co. Ltd. | | | 213,500 | | | | 7,974,971 | |
| | |
MTR Corp. Ltd. | | | 1,914,500 | | | | 7,156,803 | |
| | |
Norfolk Southern Corp. | | | 89,040 | | | | 16,987,942 | |
| | |
Odakyu Electric Railway Co. Ltd.(a) | | | 424,000 | | | | 5,994,150 | |
| | |
Rumo SA | | | 1,611,200 | | | | 7,127,875 | |
| | |
Tobu Railway Co. Ltd.(a) | | | 254,400 | | | | 6,087,659 | |
| | |
Union Pacific Corp. | | | 239,984 | | | | 49,823,078 | |
| | |
West Japan Railway Co. | | | 301,800 | | | | 11,450,644 | |
| | | | | | | 360,234,091 | |
|
Health Care Providers & Services – 3.5% | |
| | |
Acadia Healthcare Co., Inc.* | | | 36,464 | | | | 2,680,469 | |
| | |
Apollo Hospitals Enterprise Ltd. | | | 143,312 | | | | 8,296,419 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Health Care Providers & Services – (continued) | |
| | |
Bangkok Dusit Medical Services PCL, NVDR | | | 14,840,000 | | | $ | 10,941,365 | |
| | |
Bumrungrad Hospital PCL, NVDR | | | 848,000 | | | | 6,134,242 | |
| | |
Encompass Health Corp. | | | 39,008 | | | | 2,440,340 | |
| | |
HCA Healthcare, Inc. | | | 79,712 | | | | 18,026,072 | |
| | |
IHH Healthcare Bhd. | | | 3,307,200 | | | | 4,164,802 | |
| | |
Life Healthcare Group Holdings Ltd. | | | 1,385,632 | | | | 1,372,557 | |
| | |
Ramsay Health Care Ltd.(a) | | | 230,090 | | | | 7,091,775 | |
| | |
Rede D’Or Sao Luiz SA(b) | | | 1,102,400 | | | | 4,726,133 | |
| | |
Select Medical Holdings Corp. | | | 44,944 | | | | 1,021,577 | |
| | |
Tenet Healthcare Corp.* (a) | | | 39,856 | | | | 2,140,267 | |
| | |
Universal Health Services, Inc., Class B | | | 22,048 | | | | 2,775,623 | |
| | | | | | | 71,811,641 | |
|
Independent Power and Renewable Electricity Producers – 1.0% | |
| | |
RWE AG | | | 547,808 | | | | 20,920,464 | |
| | |
IT Services – 0.2% | | | | | | |
| | |
Fastly, Inc., Class A* (a) | | | 47,488 | | | | 696,649 | |
| | |
NEXTDC Ltd.* (a) | | | 399,408 | | | | 2,971,401 | |
| | | | | | | 3,668,050 | |
|
Media – 4.4% | |
| | |
Charter Communications, Inc., Class A* (a) | | | 40,704 | | | | 16,395,572 | |
| | |
Comcast Corp., Class A | | | 1,619,680 | | | | 66,876,587 | |
| | |
Liberty Broadband Corp., Class C* | | | 49,184 | | | | 4,097,519 | |
| | |
Sirius XM Holdings, Inc.(a) | | | 385,840 | | | | 1,651,395 | |
| | | | | | | 89,021,073 | |
|
Multi-Utilities – 7.2% | |
| | |
Consolidated Edison, Inc. | | | 135,680 | | | | 11,911,347 | |
| | |
Dominion Energy, Inc.(a) | | | 329,024 | | | | 13,266,248 | |
| | |
Engie SA | | | 1,505,200 | | | | 23,871,310 | |
| | |
National Grid plc | | | 2,985,808 | | | | 35,455,938 | |
| | |
Public Service Enterprise Group, Inc.(a) | | | 195,888 | | | | 12,076,495 | |
| | |
Sempra | | | 247,616 | | | | 17,340,548 | |
See Accompanying Notes to the Financial Statements.
| | | | |
330 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Multi-Utilities – (continued) | |
| | |
Veolia Environnement SA | | | 829,344 | | | $ | 22,643,007 | |
| | |
WEC Energy Group, Inc. | | | 124,656 | | | | 10,145,752 | |
| | | | | | | 146,710,645 | |
|
Oil, Gas & Consumable Fuels – 7.7% | |
| | |
Antero Midstream Corp.(a) | | | 142,464 | | | | 1,758,006 | |
| | |
DT Midstream, Inc.(a) | | | 38,160 | | | | 2,059,495 | |
| | |
Enbridge, Inc. | | | 1,637,488 | | | | 52,418,488 | |
| | |
Equitrans Midstream Corp.(a) | | | 163,664 | | | | 1,451,700 | |
| | |
Keyera Corp.(a) | | | 185,712 | | | | 4,314,217 | |
| | |
Kinder Morgan, Inc. | | | 776,768 | | | | 12,583,641 | |
| | |
Koninklijke Vopak NV | | | 51,728 | | | | 1,739,259 | |
| | |
New Fortress Energy, Inc.(a) | | | 44,096 | | | | 1,336,109 | |
| | |
ONEOK, Inc. | | | 175,536 | | | | 11,444,947 | |
| | |
Pembina Pipeline Corp. | | | 443,504 | | | | 13,634,973 | |
| | |
Plains GP Holdings LP, Class A | | | 84,800 | | | | 1,329,664 | |
| | |
Targa Resources Corp. | | | 87,344 | | | | 7,302,832 | |
| | |
TC Energy Corp.(a) | | | 832,736 | | | | 28,648,638 | |
| | |
Transneft PJSC (Preference)‡ | | | 1,473 | | | | — | |
| | |
Williams Cos., Inc. (The) | | | 478,272 | | | | 16,452,557 | |
| | | | | | | 156,474,526 | |
|
Specialized REITs – 5.0% | |
| | |
American Tower Corp., REIT(a) | | | 183,168 | | | | 32,638,706 | |
| | |
Crown Castle, Inc., REIT(a) | | | 170,448 | | | | 15,848,255 | |
| | |
Digital Realty Trust, Inc., REIT(a) | | | 118,720 | | | | 14,764,019 | |
| | |
Equinix, Inc., REIT | | | 36,781 | | | | 26,836,889 | |
| | |
Keppel DC REIT, REIT | | | 1,017,600 | | | | 1,255,242 | |
| | |
SBA Communications Corp., Class A, REIT(a) | | | 42,400 | | | | 8,845,912 | |
| | | | | | | 100,189,023 | |
|
Specialty Retail – 0.0% | |
| | |
GNC Holdings, Inc.* ‡ | | | 36,294 | | | | — | |
|
Transportation Infrastructure – 6.4% | |
| | |
Adani Ports & Special Economic Zone Ltd. | | | 979,440 | | | | 9,231,649 | |
| | |
Aena SME SA(b) | | | 90,736 | | | | 13,115,412 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Transportation Infrastructure – (continued) | |
| | |
Aeroports de Paris SA | | | 27,984 | | | $ | 3,129,468 | |
| | |
Airports of Thailand PCL, NVDR* | | | 5,257,600 | | | | 9,764,062 | |
| | |
Atlas Arteria Ltd. | | | 1,784,192 | | | | 5,998,501 | |
| | |
Auckland International Airport Ltd. | | | 1,488,979 | | | | 6,356,914 | |
| | |
Bangkok Expressway & Metro PCL, NVDR | | | 10,176,000 | | | | 2,236,639 | |
| | |
CCR SA | | | 1,356,800 | | | | 3,223,173 | |
| | |
China Merchants Port Holdings Co. Ltd. | | | 1,696,000 | | | | 2,156,685 | |
| | |
COSCO SHIPPING Ports Ltd. | | | 1,696,000 | | | | 1,020,903 | |
| | |
Flughafen Zurich AG (Registered) | | | 23,744 | | | | 4,414,576 | |
| | |
Gemadept Corp. | | | 339,200 | | | | 814,605 | |
| | |
Getlink SE | | | 399,408 | | | | 6,431,825 | |
| | |
Grupo Aeroportuario del Pacifico SAB de CV, Class B | | | 504,560 | | | | 5,877,916 | |
| | |
Grupo Aeroportuario del Sureste SAB de CV, Class B(a) | | | 224,720 | | | | 4,836,590 | |
| | |
International Container Terminal Services, Inc. | | | 2,170,880 | | | | 7,697,939 | |
| | |
Japan Airport Terminal Co. Ltd. | | | 118,900 | | | | 5,205,236 | |
| | |
Jiangsu Expressway Co. Ltd., Class H | | | 1,696,000 | | | | 1,543,276 | |
| | |
Promotora y Operadora de Infraestructura SAB de CV | | | 233,200 | | | | 1,906,368 | |
| | |
Qube Holdings Ltd.(a) | | | 2,237,872 | | | | 3,768,977 | |
| | |
Santos Brasil Participacoes SA | | | 593,600 | | | | 871,037 | |
| | |
Shenzhen International Holdings Ltd. | | | 1,272,000 | | | | 837,206 | |
| | |
Transurban Group | | | 3,792,256 | | | | 28,380,611 | |
| | |
Westshore Terminals Investment Corp.(a) | | | 41,552 | | | | 700,091 | |
| | | | | | | 129,519,659 | |
|
Water Utilities – 2.5% | |
| | |
Aguas Andinas SA, Class A | | | 3,533,616 | | | | 1,027,145 | |
| | |
American States Water Co. | | | 14,416 | | | | 1,125,169 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 331 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Water Utilities – (continued) | |
| | |
American Water Works Co., Inc. | | | 76,320 | | | $ | 8,979,048 | |
| | |
Beijing Enterprises Water Group Ltd. | | | 5,088,000 | | | | 1,072,924 | |
| | |
California Water Service Group | | | 22,896 | | | | 1,114,577 | |
| | |
Cia de Saneamento Basico do Estado de Sao Paulo SABESP | | | 424,000 | | | | 4,907,571 | |
| | |
Cia de Saneamento de Minas Gerais Copasa MG | | | 254,400 | | | | 804,112 | |
| | |
Cia de Saneamento do Parana (Preference) | | | 1,102,400 | | | | 953,096 | |
| | |
Essential Utilities, Inc.(a) | | | 95,824 | | | | 3,206,271 | |
| | |
Guangdong Investment Ltd. | | | 3,392,000 | | | | 2,314,914 | |
| | |
Middlesex Water Co. | | | 7,632 | | | | 484,861 | |
| | |
Pennon Group plc | | | 320,544 | | | | 2,825,825 | |
| | |
Severn Trent plc | | | 313,760 | | | | 10,112,244 | |
| | |
SJW Group(a) | | | 11,872 | | | | 741,763 | |
| | |
United Utilities Group plc | | | 831,040 | | | | 10,719,563 | |
| | | | | | | 50,389,083 | |
|
Wireless Telecommunication Services – 6.1% | |
| | |
KDDI Corp. | | | 1,187,200 | | | | 35,174,264 | |
| | |
SoftBank Corp. | | | 2,204,800 | | | | 24,822,107 | |
| | |
SoftBank Group Corp.(a) | | | 808,700 | | | | 32,701,501 | |
| | |
T-Mobile US, Inc.* | | | 206,912 | | | | 29,766,360 | |
| | | | | | | 122,464,232 | |
Total Common Stocks (Cost $2,132,513,770) | | | | 2,006,949,303 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 2.0%(c) | |
|
INVESTMENT COMPANIES – 0.6% | |
| | |
BlackRock Liquidity FedFund, Institutional Shares 5.35%, 11/1/2023 | | $ | 3,000,000 | | | | 3,000,000 | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 | | | 2,000,000 | | | | 2,000,000 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
INVESTMENT COMPANIES – (continued) | |
| | |
Goldman Sachs Financial Square Government Fund, Institutional Class 5.36%, 11/1/2023 | | $ | 3,000,000 | | | $ | 3,000,000 | |
| | |
Invesco Government & Agency Portfolio, Institutional Shares 5.36%, 11/1/2023 | | | 3,000,000 | | | | 3,000,000 | |
Total Investment Companies (Cost $11,000,000) | | | | 11,000,000 | |
| | |
| | | | | | | | |
|
REPURCHASE AGREEMENTS – 1.4% | |
| | |
BofA Securities, Inc., 5.77%, dated 10/31/2023, due 1/31/2024, repurchase price $2,029,491, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 6.13%, maturing 7/15/2024 – 11/15/2044; total market value $2,014,128 | | | 2,000,000 | | | | 2,000,000 | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $1,000,147, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $1,008,399 | | | 1,000,000 | | | | 1,000,000 | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $21,147,464, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $21,384,800 | | | 21,144,363 | | | | 21,144,363 | |
See Accompanying Notes to the Financial Statements.
| | | | |
332 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
REPURCHASE AGREEMENTS – (continued) | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $5,000,753, collateralized by various Common Stocks; total market value $5,537,547 | | $ | 5,000,000 | | | $ | 5,000,000 | |
Total Repurchase Agreements (Cost $29,144,363) | | | | 29,144,363 | |
Total Securities Lending Reinvestments (Cost $40,144,363) | | | | 40,144,363 | |
Total Investments – 101.1% (Cost $2,172,658,133) | | | | 2,047,093,666 | |
| |
Liabilities in excess of other assets – (1.1%) | | | | (21,912,203 | ) |
NET ASSETS – 100.0% | | | | | | $ | 2,025,181,463 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $185,056,097, collateralized in the form of cash with a value of $40,144,363 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $137,958,979 of collateral in the form of U.S. Government |
| Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 15, 2023 – August 15, 2053 and $17,789,760 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $195,893,102. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $40,144,363. |
Percentages shown are based on Net Assets.
Abbreviations
NVDR – Non-Voting Depositary Receipt
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 123,493,504 | |
Aggregate gross unrealized depreciation | | | (260,266,307 | ) |
Net unrealized depreciation | | $ | (136,772,803 | ) |
Federal income tax cost | | $ | 2,183,010,473 | |
Futures Contracts
FlexShares® STOXX® Global Broad Infrastructure Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
FTSE 100 Index | | | 41 | | | | 12/15/2023 | | | | GBP | | | $ | 3,645,786 | | | $ | (131,863 | ) |
S&P 500 E-Mini Index | | | 25 | | | | 12/15/2023 | | | | USD | | | | 5,265,312 | | | | (298,717 | ) |
S&P/TSX 60 Index | | | 35 | | | | 12/14/2023 | | | | CAD | | | | 5,723,033 | | | | (305,972 | ) |
SPI 200 Index | | | 16 | | | | 12/21/2023 | | | | AUD | | | | 1,717,863 | | | | (112,441 | ) |
TOPIX Index | | | 13 | | | | 12/07/2023 | | | | JPY | | | | 1,934,828 | | | | (71,029 | ) |
| | | | | | | | | | | | | | | | | | $ | (920,022 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 333 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
Forward Foreign Currency Contracts
FlexShares® STOXX® Global Broad Infrastructure Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | | | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 2,863,950 | | | | | Toronto-Dominion Bank (The) | | | GBP | | | | 2,300,000 | | | | 12/20/2023 | | | $ | 71,922 | |
USD | | | 606,200 | | | | | Bank of Montreal | | | JPY | | | | 90,000,000 | | | | 12/20/2023 | | | | 6,925 | |
Total unrealized appreciation | | | | | | | | | | | | | | | | $ | 78,847 | |
GBP | | | 2,300,000 | | | | | JPMorgan Chase Bank NA | | | USD | | | | 2,806,849 | | | | 12/20/2023 | | | $ | (14,821 | ) |
Total unrealized depreciation | | | | | | | | | | | | | | | | $ | (14,821 | ) |
Net unrealized appreciation | | | | | | | | | | | | | | | | $ | 64,026 | |
Abbreviations:
AUD – Australian Dollar
CAD – Canadian Dollar
GBP – British Pound
JPY – Japanese Yen
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | |
334 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund (cont.)
FlexShares® STOXX® Global Broad Infrastructure Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 3.0 | % |
Austria | | | 0.1 | |
Belgium | | | 0.0 | † |
Brazil | | | 1.1 | |
Canada | | | 16.5 | |
Chile | | | 0.1 | |
China | | | 0.6 | |
France | | | 2.8 | |
Germany | | | 6.3 | |
Hong Kong | | | 0.6 | |
India | | | 0.9 | |
Indonesia | | | 0.1 | |
Italy | | | 2.6 | |
Japan | | | 11.8 | |
Malaysia | | | 0.3 | |
Mexico | | | 0.7 | |
Netherlands | | | 0.6 | |
New Zealand | | | 0.5 | |
Philippines | | | 0.4 | |
Portugal | | | 0.0 | † |
Singapore | | | 0.1 | |
South Africa | | | 0.1 | |
South Korea | | | 0.0 | † |
Spain | | | 3.9 | |
Switzerland | | | 0.8 | |
Taiwan | | | 0.1 | |
Thailand | | | 1.4 | |
United Kingdom | | | 3.4 | |
United States | | | 40.3 | |
Vietnam | | | 0.0 | † |
Other1 | | | 0.9 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.1 | % |
Securities Lending Reinvestments | | | 2.0 | |
Others(1) | | | (1.1 | ) |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 335 | |
Schedule of Investments
FlexShares® Global Quality Real Estate Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.6% | |
|
Diversified REITs – 5.1% | |
| | |
Broadstone Net Lease, Inc., REIT(a) | | | 80,496 | | | $ | 1,139,018 | |
| | |
Empire State Realty Trust, Inc., Class A, REIT | | | 79,976 | | | | 647,006 | |
| | |
Essential Properties Realty Trust, Inc., REIT(a) | | | 61,880 | | | | 1,358,266 | |
| | |
GPT Group (The), REIT | | | 802,568 | | | | 1,839,488 | |
| | |
H&R REIT, REIT(a) | | | 84,760 | | | | 520,802 | |
| | |
Land Securities Group plc, REIT | | | 296,504 | | | | 2,047,221 | |
| | |
Merlin Properties Socimi SA, REIT | | | 136,760 | | | | 1,136,205 | |
| | |
Mori Trust Reit, Inc., REIT | | | 1,352 | | | | 657,944 | |
| | |
NIPPON REIT Investment Corp., REIT | | | 22 | | | | 50,699 | |
| | |
OUE Commercial REIT, REIT | | | 426,400 | | | | 73,139 | |
| | |
Stockland, REIT | | | 1,011,920 | | | | 2,268,068 | |
| | |
Tokyu REIT, Inc., REIT | | | 520 | | | | 619,420 | |
| | | | | | | 12,357,276 | |
|
Health Care REITs – 2.1% | |
| | |
Healthpeak Properties, Inc., REIT | | | 227,136 | | | | 3,531,965 | |
| | |
National Health Investors, Inc., REIT | | | 17,992 | | | | 900,320 | |
| | |
Welltower, Inc., REIT | | | 8,632 | | | | 721,721 | |
| | | | | | | 5,154,006 | |
|
Hotel & Resort REITs – 4.7% | |
| | |
Apple Hospitality REIT, Inc., REIT(a) | | | 90,688 | | | | 1,421,988 | |
| | |
CDL Hospitality Trusts, REIT | | | 821,600 | | | | 581,696 | |
| | |
Covivio Hotels SACA, REIT | | | 6,240 | | | | 106,520 | |
| | |
DiamondRock Hospitality Co., REIT | | | 91,728 | | | | 709,057 | |
| | |
Far East Hospitality Trust, REIT | | | 176,800 | | | | 76,137 | |
| | |
Host Hotels & Resorts, Inc., REIT | | | 299,624 | | | | 4,638,179 | |
| | |
Park Hotels & Resorts, Inc., REIT(a) | | | 92,872 | | | | 1,070,814 | |
| | |
Pebblebrook Hotel Trust, REIT(a) | | | 54,392 | | | | 648,897 | |
| | |
RLJ Lodging Trust, REIT | | | 74,984 | | | | 704,850 | |
| | |
Service Properties Trust, REIT | | | 84,760 | | | | 614,510 | |
| | |
Sunstone Hotel Investors, Inc., REIT | | | 85,176 | | | | 792,137 | |
| | | | | | | 11,364,785 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Household Durables – 0.4% | |
| | |
Iida Group Holdings Co. Ltd. | | | 62,400 | | | $ | 959,620 | |
|
Industrial REITs – 8.2% | |
| | |
AIMS APAC REIT, REIT | | | 676,000 | | | | 592,095 | |
| | |
Dream Industrial REIT, REIT(a) | | | 72,860 | | | | 614,580 | |
| | |
First Industrial Realty Trust, Inc., REIT | | | 55,640 | | | | 2,353,572 | |
| | |
Frasers Logistics & Commercial Trust, REIT(b) | | | 1,237,600 | | | | 939,458 | |
| | |
Goodman Group, REIT(a) | | | 26,728 | | | | 350,979 | |
| | |
Granite REIT, REIT(a) | | | 13,000 | | | | 591,356 | |
| | |
LXP Industrial Trust, REIT | | | 118,456 | | | | 936,987 | |
| | |
Mapletree Logistics Trust, REIT | | | 1,453,769 | | | | 1,559,827 | |
| | |
Montea NV, REIT | | | 9,048 | | | | 637,901 | |
| | |
Prologis, Inc., REIT | | | 88,400 | | | | 8,906,300 | |
| | |
STAG Industrial, Inc., REIT | | | 76,544 | | | | 2,542,792 | |
| | | | | | | 20,025,847 | |
|
Office REITs – 3.1% | |
| | |
COPT Defense Properties, REIT(a) | | | 48,360 | | | | 1,102,608 | |
| | |
Covivio SA, REIT | | | 19,864 | | | | 848,248 | |
| | |
Dexus, REIT(a) | | | 377,208 | | | | 1,547,614 | |
| | |
Equity Commonwealth, REIT | | | 45,344 | | | | 858,815 | |
| | |
Gecina SA, REIT | | | 19,552 | | | | 1,913,715 | |
| | |
Inmobiliaria Colonial Socimi SA, REIT(a) | | | 129,584 | | | | 724,573 | |
| | |
Keppel REIT, REIT | | | 1,144,000 | | | | 663,830 | |
| | |
SL Green Realty Corp., REIT | | | 1 | | | | 28 | |
| | | | | | | 7,659,431 | |
|
Real Estate Management & Development – 17.6% | |
| | |
Aeon Mall Co. Ltd. | | | 52,000 | | | | 588,174 | |
| | |
Atrium Ljungberg AB, Class B(a) | | | 39,520 | | | | 606,278 | |
| | |
Bukit Sembawang Estates Ltd. | | | 31,200 | | | | 82,438 | |
| | |
Capitaland India Trust | | | 780,000 | | | | 546,549 | |
| | |
City Developments Ltd. | | | 208,000 | | | | 959,498 | |
| | |
CTP NV(b) | | | 57,791 | | | | 840,531 | |
| | |
Daito Trust Construction Co. Ltd. | | | 26,200 | | | | 2,793,952 | |
| | |
Fabege AB(a) | | | 109,408 | | | | 813,364 | |
| | |
Fastighets AB Balder, Class B* (a) | | | 280,488 | | | | 1,184,699 | |
| | |
Grainger plc | | | 305,448 | | | | 842,849 | |
See Accompanying Notes to the Financial Statements.
| | | | |
336 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Global Quality Real Estate Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Real Estate Management & Development – (continued) | |
| | |
Grand City Properties SA* | | | 52,208 | | | $ | 465,476 | |
| | |
Heiwa Real Estate Co. Ltd.(a) | | | 24,900 | | | | 632,180 | |
| | |
Howard Hughes Holdings, Inc.* (a) | | | 5,304 | | | | 351,814 | |
| | |
Hulic Co. Ltd. | | | 166,400 | | | | 1,512,977 | |
| | |
Intershop Holding AG | | | 936 | | | | 620,194 | |
| | |
Isras Investment Co. Ltd.(a) | | | 3,120 | | | | 527,204 | |
| | |
Kerry Properties Ltd. | | | 312,000 | | | | 524,745 | |
| | |
LEG Immobilien SE* | | | 31,096 | | | | 1,933,981 | |
| | |
Lifestyle Communities Ltd.(a) | | | 63,856 | | | | 629,502 | |
| | |
Mitsubishi Estate Co. Ltd. | | | 93,600 | | | | 1,182,940 | |
| | |
Mitsui Fudosan Co. Ltd. | | | 135,200 | | | | 2,898,705 | |
| | |
Mobimo Holding AG (Registered) | | | 2,704 | | | | 745,788 | |
| | |
Nexity SA(a) | | | 24,752 | | | | 344,826 | |
| | |
Nomura Real Estate Holdings, Inc. | | | 47,100 | | | | 1,090,069 | |
| | |
Platzer Fastigheter Holding AB, Class B | | | 5,304 | | | | 27,772 | |
| | |
PSP Swiss Property AG (Registered) | | | 19,240 | | | | 2,361,527 | |
| | |
Shurgard Self Storage Ltd., REIT | | | 16,640 | | | | 621,049 | |
| | |
Sirius Real Estate Ltd. | | | 701,064 | | | | 678,863 | |
| | |
St Joe Co. (The) | | | 15,080 | | | | 703,331 | |
| | |
Sumitomo Realty & Development Co. Ltd.(a) | | | 121,600 | | | | 3,014,206 | |
| | |
Sun Hung Kai Properties Ltd. | | | 616,500 | | | | 6,330,774 | |
| | |
Swire Properties Ltd. | | | 499,200 | | | | 965,914 | |
| | |
TAG Immobilien AG* | | | 73,216 | | | | 795,949 | |
| | |
Tokyo Tatemono Co. Ltd. | | | 83,200 | | | | 1,092,706 | |
| | |
Tokyu Fudosan Holdings Corp. | | | 260,000 | | | | 1,496,702 | |
| | |
Tricon Residential, Inc.(a) | | | 111,800 | | | | 740,099 | |
| | |
UOL Group Ltd. | | | 197,600 | | | | 850,947 | |
| | |
Wihlborgs Fastigheter AB | | | 114,296 | | | | 738,093 | |
| | | | | | | 43,136,665 | |
|
Residential REITs – 17.3% | |
| | |
American Homes 4 Rent, Class A, REIT | | | 138,112 | | | | 4,521,787 | |
| | |
Apartment Investment and Management Co., Class A, REIT* | | | 82,368 | | | | 482,676 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Residential REITs – (continued) | |
| | |
AvalonBay Communities, Inc., REIT | | | 60,112 | | | $ | 9,962,963 | |
| | |
Boardwalk REIT, REIT(a) | | | 14,144 | | | | 659,799 | |
| | |
Canadian Apartment Properties REIT, REIT(a) | | | 34,112 | | | | 1,003,027 | |
| | |
Centerspace, REIT(a) | | | 11,128 | | | | 540,598 | |
| | |
Equity Residential, REIT | | | 152,048 | | | | 8,412,816 | |
| | |
Essex Property Trust, Inc., REIT | | | 27,144 | | | | 5,806,644 | |
| | |
InterRent REIT, REIT(a) | | | 60,840 | | | | 515,381 | |
| | |
Killam Apartment REIT, REIT | | | 46,488 | | | | 524,738 | |
| | |
Mid-America Apartment Communities, Inc., REIT | | | 48,880 | | | | 5,775,172 | |
| | |
UDR, Inc., REIT | | | 132,912 | | | | 4,227,931 | |
| | | | | | | 42,433,532 | |
|
Retail REITs – 19.2% | |
| | |
Acadia Realty Trust, REIT | | | 51,376 | | | | 735,704 | |
| | |
Brixmor Property Group, Inc., REIT | | | 126,256 | | | | 2,624,862 | |
| | |
Carmila SA, REIT* | | | 44,096 | | | | 616,177 | |
| | |
Crombie REIT, REIT(a) | | | 52,624 | | | | 461,704 | |
| | |
CT REIT, REIT(a) | | | 58,136 | | | | 529,746 | |
| | |
Eurocommercial Properties NV, REIT | | | 29,120 | | | | 622,984 | |
| | |
Federal Realty Investment Trust, REIT | | | 12,168 | | | | 1,109,600 | |
| | |
Fortune REIT, REIT | | | 208,000 | | | | 116,433 | |
| | |
Fukuoka REIT Corp., REIT | | | 520 | | | | 558,988 | |
| | |
HMC Capital Ltd., REIT(a) | | | 192,400 | | | | 517,727 | |
| | |
InvenTrust Properties Corp., REIT(a) | | | 32,760 | | | | 822,276 | |
| | |
Kimco Realty Corp., REIT | | | 261,248 | | | | 4,686,789 | |
| | |
Kite Realty Group Trust, REIT(a) | | | 93,704 | | | | 1,997,769 | |
| | |
Klepierre SA, REIT | | | 91,832 | | | | 2,222,821 | |
| | |
Mapletree Pan Asia Commercial Trust, REIT | | | 988,000 | | | | 959,118 | |
| | |
NNN REIT, Inc., REIT | | | 76,128 | | | | 2,765,730 | |
| | |
PARAGON REIT, REIT | | | 915,200 | | | | 531,064 | |
| | |
Phillips Edison & Co., Inc., REIT(a) | | | 50,232 | | | | 1,773,692 | |
| | |
Realty Income Corp., REIT | | | 2,184 | | | | 103,478 | |
| | |
Regency Centers Corp., REIT | | | 64,792 | | | | 3,904,366 | |
| | |
Retail Estates NV, REIT | | | 1,248 | | | | 75,850 | |
| | |
RioCan REIT, REIT(a) | | | 60,840 | | | | 738,451 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 337 | |
FlexShares® Global Quality Real Estate Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Retail REITs – (continued) | |
| | |
RPT Realty, REIT | | | 69,472 | | | $ | 749,603 | |
| | |
Simon Property Group, Inc., REIT | | | 115,128 | | | | 12,651,416 | |
| | |
SITE Centers Corp., REIT | | | 78,104 | | | | 910,693 | |
| | |
SmartCentres REIT, REIT(a) | | | 38,272 | | | | 592,448 | |
| | |
Spirit Realty Capital, Inc., REIT | | | 59,280 | | | | 2,133,487 | |
| | |
Tanger Factory Outlet Centers, Inc., REIT(a) | | | 45,344 | | | | 1,022,507 | |
| | |
Waypoint REIT Ltd., REIT | | | 388,440 | | | | 521,395 | |
| | | | | | | 47,056,878 | |
|
Specialized REITs – 20.9% | |
| | |
American Tower Corp., REIT | | | 35,984 | | | | 6,411,989 | |
| | |
Crown Castle, Inc., REIT | | | 8,632 | | | | 802,603 | |
| | |
CubeSmart, REIT | | | 94,640 | | | | 3,226,278 | |
| | |
EPR Properties, REIT(a) | | | 31,408 | | | | 1,341,122 | |
| | |
Equinix, Inc., REIT(a) | | | 6,240 | | | | 4,552,954 | |
| | |
Iron Mountain, Inc., REIT(a) | | | 123,656 | | | | 7,304,360 | |
| | |
Keppel DC REIT, REIT | | | 592,800 | | | | 731,237 | |
| | |
Lamar Advertising Co., Class A, REIT | | | 35,672 | | | | 2,934,735 | |
| | |
National Storage REIT, REIT(a) | | | 561,496 | | | | 711,022 | |
| | |
PotlatchDeltic Corp., REIT | | | 33,384 | | | | 1,430,504 | |
| | |
Public Storage, REIT | | | 50,648 | | | | 12,090,184 | |
| | |
Safestore Holdings plc, REIT | | | 90,272 | | | | 748,710 | |
| | |
Weyerhaeuser Co., REIT | | | 308,568 | | | | 8,852,816 | |
| | | | | | | 51,138,514 | |
Total Common Stocks (Cost $283,496,998) | | | | | | | 241,286,554 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 1.1%(c) | |
|
REPURCHASE AGREEMENTS – 1.1% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $2,704,617, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $2,734,970 (Cost $2,704,220) | | $ | 2,704,220 | | | $ | 2,704,220 | |
Total Investments – 99.7% (Cost $286,201,218) | | | | | | | 243,990,774 | |
| |
Other assets less liabilities – 0.3% | | | | 682,557 | |
NET ASSETS – 100.0% | | | | | | $ | 244,673,331 | |
* | Non-income producing security. |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $27,759,368, collateralized in the form of cash with a value of $2,704,220 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $24,122,125 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $1,989,955 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.75%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $28,816,300. |
(b) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(c) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $2,704,220. |
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
See Accompanying Notes to the Financial Statements.
| | | | |
338 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Global Quality Real Estate Index Fund (cont.)
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 5,436,752 | |
Aggregate gross unrealized depreciation | | | (48,702,673 | ) |
Net unrealized depreciation | | $ | (43,265,921 | ) |
Federal income tax cost | | $ | 287,014,870 | |
Futures Contracts
FlexShares® Global Quality Real Estate Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | | | | | | | | | | | | | | | | |
EURO STOXX 50 Index | | | 9 | | | | 12/15/2023 | | | | EUR | | | $ | 387,179 | | | $ | (20,416 | ) |
S&P Midcap 400 E-Mini Index | | | 9 | | | | 12/15/2023 | | | | USD | | | | 2,137,590 | | | | (166,959 | ) |
SPI 200 Index | | | 8 | | | | 12/21/2023 | | | | AUD | | | | 858,931 | | | | (51,556 | ) |
TOPIX Mini Index | | | 1 | | | | 12/07/2023 | | | | JPY | | | | 14,884 | | | | (96 | ) |
| | | | | | | | | | | | | | | | | | $ | (239,027 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® Global Quality Real Estate Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | | | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 22,257 | | | | | Citibank NA | | | AUD | | | | 34,359 | | | | 12/20/2023 | | | $ | 467 | |
USD | | | 516,801 | | | | | Citibank NA | | | CAD | | | | 699,270 | | | | 12/20/2023 | | | | 12,663 | |
USD | | | 215,786 | | | | | Toronto-Dominion Bank (The) | | | EUR | | | | 201,355 | | | | 12/20/2023 | | | | 2,463 | |
USD | | | 29,391 | | | | | Citibank NA | | | ILS | | | | 111,846 | | | | 12/20/2023 | | | | 1,667 | |
USD | | | 46,440 | | | | | BNP Paribas SA | | | SGD | | | | 62,894 | | | | 12/20/2023 | | | | 434 | |
Total unrealized appreciation | | | | | | | | | | | | | | | | $ | 17,694 | |
CAD | | | 909,000 | | | | | UBS AG | | | USD | | | | 675,834 | | | | 12/20/2023 | | | $ | (20,492 | ) |
Total unrealized depreciation | | | | | | | | | | | | | | | | $ | (20,492 | ) |
Net unrealized depreciation | | | | | | | | | | | | | | | | $ | (2,798 | ) |
Abbreviations:
AUD – Australian Dollar
CAD – Canadian Dollar
EUR – Euro
ILS – Israeli Shekel
JPY – Japanese Yen
SGD – Singapore Dollar
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 339 | |
FlexShares® Global Quality Real Estate Index Fund (cont.)
FlexShares® Global Quality Real Estate Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 3.4 | % |
Belgium | | | 0.5 | |
Canada | | | 3.1 | |
France | | | 2.5 | |
Germany | | | 1.3 | |
Hong Kong | | | 3.2 | |
Israel | | | 0.2 | |
Japan | | | 7.8 | |
Netherlands | | | 0.6 | |
Singapore | | | 3.7 | |
Spain | | | 0.8 | |
Sweden | | | 1.4 | |
Switzerland | | | 1.5 | |
United Kingdom | | | 1.8 | |
United States | | | 66.8 | |
Other1 | | | 1.4 | |
| | | 100.0 | % |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.6 | % |
Securities Lending Reinvestments | | | 1.1 | |
Others(1) | | | 0.3 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
340 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Real Assets Allocation Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
EXCHANGE TRADED FUNDS – 100.0%(a) | |
| | |
FlexShares® Global Quality Real Estate Index Fund | | | 58,800 | | | $ | 2,773,255 | |
| | |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | 140,568 | | | | 5,421,708 | |
| | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund | | | 174,984 | | | | 8,376,484 | |
Total Exchange Traded Funds (Cost $20,377,865) | | | | | | | 16,571,447 | |
| | | | | | | | |
Total Investments – 100.0% (Cost $20,377,865) | | | | | | | 16,571,447 | |
| | |
Other assets less liabilities – 0.0%(b) | | | | | | | 1,104 | |
NET ASSETS – 100.0% | | | | | | $ | 16,572,551 | |
(a) | Investment in affiliated Fund. Northern Trust Investments, Inc. is the Investment Adviser to both the Fund and the affiliated Funds. |
(b) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | — | |
Aggregate gross unrealized depreciation | | | (3,832,291 | ) |
Net unrealized depreciation | | $ | (3,832,291 | ) |
Federal income tax cost | | $ | 20,403,738 | |
The underlying index of the FlexShares® Real Assets Allocation Index Fund is comprised of securities of affiliated FlexShares® Funds. The Schedules of Investments of the affiliated FlexShares® Funds are located elsewhere in this Report.
Investment in a company which was affiliated for the period ended October 31, 2023, was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Security | | Value October 31, 2022 | | | Purchases at Cost | | | Sales Proceeds | | | Shares October 31, 2023 | | | Value October 31, 2023 | | | Change in Unrealized Appreciation (Depreciation) | | | Dividend Income | | | Realized Loss | |
FlexShares® Global Quality Real Estate Index Fund | | $ | 6,766,701 | | | $ | 269,315 | | | $ | 4,098,037 | | | | 58,800 | | | $ | 2,773,255 | | | $ | 933,648 | | | $ | 109,473 | | | $ | (1,098,372 | ) |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | 7,230,364 | | | | 2,196,074 | | | | 3,632,629 | | | | 140,568 | | | | 5,421,708 | | | | (494,141 | ) | | | 177,825 | | | | 122,040 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund | | | 14,861,299 | | | | 652,994 | | | | 7,443,537 | | | | 174,984 | | | | 8,376,484 | | | | 1,097,035 | | | | 245,547 | | | | (791,307 | ) |
| | $ | 28,858,364 | | | $ | 3,118,383 | | | $ | 15,174,203 | | | | 374,352 | | | $ | 16,571,447 | | | $ | 1,536,542 | | | $ | 532,845 | | | $ | (1,767,639 | ) |
| | | | |
Security Type | | % of Net Assets | |
Exchange Traded Funds | | | 100.0 | % |
Others(1) | | | 0.0 | † |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
† | Amount represents less than 0.05%. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 341 | |
Schedule of Investments
FlexShares® Quality Dividend Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.8% | |
|
Aerospace & Defense – 0.7% | |
| | |
Lockheed Martin Corp. | | | 22,620 | | | $ | 10,283,957 | |
|
Banks – 2.4% | |
| | |
Commerce Bancshares, Inc.(a) | | | 160,728 | | | | 7,049,530 | |
| | |
Cullen/Frost Bankers, Inc. | | | 57,558 | | | | 5,237,203 | |
| | |
JPMorgan Chase & Co. | | | 56,472 | | | | 7,852,996 | |
| | |
Popular, Inc. | | | 120,546 | | | | 7,840,312 | |
| | |
Zions Bancorp NA(a) | | | 231,318 | | | | 7,136,160 | |
| | | | | | | 35,116,201 | |
|
Beverages – 1.7% | |
| | |
Coca-Cola Co. (The) | | | 411,594 | | | | 23,250,945 | |
| | |
PepsiCo, Inc. | | | 7,602 | | | | 1,241,255 | |
| | | | | | | 24,492,200 | |
|
Biotechnology – 5.1% | |
| | |
AbbVie, Inc. | | | 229,146 | | | | 32,350,832 | |
| | |
Amgen, Inc. | | | 97,740 | | | | 24,992,118 | |
| | |
Gilead Sciences, Inc. | | | 232,404 | | | | 18,253,010 | |
| | | | | | | 75,595,960 | |
|
Broadline Retail – 0.5% | |
| | |
Dillard’s, Inc., Class A(a) | | | 7,602 | | | | 2,360,041 | |
| | |
eBay, Inc. | | | 109,686 | | | | 4,302,982 | |
| | | | | | | 6,663,023 | |
|
Building Products – 0.9% | |
| | |
Advanced Drainage Systems, Inc.(a) | | | 65,160 | | | | 6,961,043 | |
| | |
Fortune Brands Innovations, Inc.(a) | | | 122,718 | | | | 6,847,664 | |
| | | | | | | 13,808,707 | |
|
Capital Markets – 3.4% | |
| | |
Bank of New York Mellon Corp. (The) | | | 201,996 | | | | 8,584,830 | |
| | |
BlackRock, Inc.(a) | | | 27,995 | | | | 17,140,779 | |
| | |
Jefferies Financial Group, Inc. | | | 200,910 | | | | 6,465,284 | |
| | |
Lazard Ltd., Class A | | | 105,342 | | | | 2,925,347 | |
| | |
Moelis & Co., Class A(a) | | | 179,190 | | | | 7,461,471 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
State Street Corp. | | | 124,890 | | | $ | 8,071,641 | |
| | | | | | | 50,649,352 | |
|
Chemicals – 1.1% | |
| | |
CF Industries Holdings, Inc. | | | 19,548 | | | | 1,559,540 | |
| | |
LyondellBasell Industries NV, Class A | | | 83,622 | | | | 7,546,049 | |
| | |
Mosaic Co. (The) | | | 78,192 | | | | 2,539,676 | |
| | |
Olin Corp. | | | 122,718 | | | | 5,242,513 | |
| | | | | | | 16,887,778 | |
|
Commercial Services & Supplies – 0.3% | |
| | |
Cintas Corp.(a) | | | 8,688 | | | | 4,405,859 | |
|
Communications Equipment – 2.7% | |
| | |
Cisco Systems, Inc. | | | 755,856 | | | | 39,402,773 | |
|
Construction Materials – 0.1% | |
| | |
Eagle Materials, Inc. | | | 5,430 | | | | 835,731 | |
|
Consumer Finance – 0.7% | |
| | |
Ally Financial, Inc.(a) | | | 201,996 | | | | 4,886,283 | |
| | |
OneMain Holdings, Inc. | | | 145,524 | | | | 5,228,677 | |
| | | | | | | 10,114,960 | |
|
Consumer Staples Distribution & Retail – 0.2% | |
| | |
Costco Wholesale Corp. | | | 2,172 | | | | 1,199,900 | |
| | |
Walmart, Inc. | | | 6,516 | | | | 1,064,779 | |
| | | | | | | 2,264,679 | |
|
Containers & Packaging – 0.6% | |
| | |
Packaging Corp. of America(a) | | | 56,472 | | | | 8,643,040 | |
|
Distributors – 0.5% | |
| | |
Pool Corp.(a) | | | 22,806 | | | | 7,201,451 | |
|
Diversified Telecommunication Services – 0.4% | |
| | |
Iridium Communications, Inc. | | | 165,072 | | | | 6,115,918 | |
|
Electric Utilities – 1.4% | |
| | |
Evergy, Inc. | | | 130,320 | | | | 6,403,925 | |
| | |
Hawaiian Electric Industries, Inc. | | | 604,902 | | | | 7,851,628 | |
See Accompanying Notes to the Financial Statements.
| | | | |
342 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Electric Utilities – (continued) | |
| | |
OGE Energy Corp.(a) | | | 204,168 | | | $ | 6,982,545 | |
| | | | | | | 21,238,098 | |
|
Entertainment – 1.2% | |
| | |
Electronic Arts, Inc. | | | 76,020 | | | | 9,410,516 | |
| | |
Warner Music Group Corp., Class A | | | 245,436 | | | | 7,682,147 | |
| | | | | | | 17,092,663 | |
|
Financial Services – 2.3% | |
| | |
Fidelity National Information Services, Inc. | | | 161,814 | | | | 7,946,685 | |
| | |
Mastercard, Inc., Class A | | | 10,988 | | | | 4,135,334 | |
| | |
Radian Group, Inc.(a) | | | 301,908 | | | | 7,650,349 | |
| | |
Visa, Inc., Class A(a) | | | 27,150 | | | | 6,382,965 | |
| | |
Western Union Co. (The) | | | 683,094 | | | | 7,712,131 | |
| | | | | | | 33,827,464 | |
|
Gas Utilities – 0.5% | |
| | |
UGI Corp. | | | 336,660 | | | | 7,002,528 | |
|
Ground Transportation – 2.0% | |
| | |
Old Dominion Freight Line, Inc. | | | 22,806 | | | | 8,590,108 | |
| | |
Union Pacific Corp. | | | 104,256 | | | | 21,644,588 | |
| | | | | | | 30,234,696 | |
|
Health Care Equipment & Supplies – 1.4% | |
| | |
Abbott Laboratories | | | 219,372 | | | | 20,741,623 | |
|
Health Care Providers & Services – 1.1% | |
| | |
Cigna Group (The) | | | 5,430 | | | | 1,678,956 | |
| | |
McKesson Corp. | | | 10,860 | | | | 4,945,209 | |
| | |
UnitedHealth Group, Inc. | | | 18,678 | | | | 10,003,190 | |
| | | | | | | 16,627,355 | |
|
Health Care REITs – 0.4% | |
| | |
Healthpeak Properties, Inc., REIT | | | 413,766 | | | | 6,434,061 | |
|
Hotel & Resort REITs – 1.0% | |
| | |
Apple Hospitality REIT, Inc., REIT(a) | | | 444,174 | | | | 6,964,648 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Hotel & Resort REITs – (continued) | |
| | |
Host Hotels & Resorts, Inc., REIT(a) | | | 458,292 | | | $ | 7,094,360 | |
| | | | | | | 14,059,008 | |
|
Hotels, Restaurants & Leisure – 1.1% | |
| | |
Boyd Gaming Corp. | | | 18,462 | | | | 1,020,026 | |
| | |
Domino’s Pizza, Inc. | | | 4,344 | | | | 1,472,573 | |
| | |
Marriott International, Inc., Class A | | | 3,258 | | | | 614,328 | |
| | |
Starbucks Corp. | | | 144,438 | | | | 13,322,961 | |
| | | | | | | 16,429,888 | |
|
Household Products – 3.6% | |
| | |
Colgate-Palmolive Co. | | | 31,494 | | | | 2,365,829 | |
| | |
Procter & Gamble Co. (The) | | | 343,176 | | | | 51,486,696 | |
| | | | | | | 53,852,525 | |
|
Industrial Conglomerates – 0.3% | |
| | |
Honeywell International, Inc. | | | 26,064 | | | | 4,776,489 | |
|
Insurance – 4.6% | |
| | |
Aflac, Inc. | | | 123,804 | | | | 9,670,330 | |
| | |
Allstate Corp. (The) | | | 64,074 | | | | 8,209,802 | |
| | |
First American Financial Corp. | | | 135,750 | | | | 6,982,980 | |
| | |
Lincoln National Corp. | | | 223,716 | | | | 4,870,297 | |
| | |
MetLife, Inc. | | | 131,406 | | | | 7,885,674 | |
| | |
Old Republic International Corp. | | | 296,478 | | | | 8,117,568 | |
| | |
Principal Financial Group, Inc.(a) | | | 90,138 | | | | 6,100,540 | |
| | |
Prudential Financial, Inc. | | | 86,880 | | | | 7,944,307 | |
| | |
Willis Towers Watson plc | | | 35,838 | | | | 8,453,826 | |
| | | | | | | 68,235,324 | |
|
IT Services – 2.7% | |
| | |
Accenture plc, Class A | | | 106,428 | | | | 31,618,695 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 132,492 | | | | 8,541,759 | |
| | | | | | | 40,160,454 | |
|
Machinery – 1.5% | |
| | |
Caterpillar, Inc. | | | 10,860 | | | | 2,454,903 | |
| | |
Illinois Tool Works, Inc. | | | 55,386 | | | | 12,413,110 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 343 | |
FlexShares® Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Machinery – (continued) | |
| | |
Snap-on, Inc. | | | 30,408 | | | $ | 7,843,440 | |
| | | | | | | 22,711,453 | |
|
Media – 3.0% | |
| | |
Comcast Corp., Class A | | | 318,198 | | | | 13,138,395 | |
| | |
Fox Corp., Class A | | | 21,720 | | | | 660,071 | |
| | |
New York Times Co. (The), Class A | | | 188,964 | | | | 7,617,139 | |
| | |
Nexstar Media Group, Inc., Class A(a) | | | 49,956 | | | | 6,997,836 | |
| | |
Omnicom Group, Inc. | | | 103,170 | | | | 7,728,465 | |
| | |
Sirius XM Holdings, Inc.(a) | | | 435,486 | | | | 1,863,880 | |
| | |
TEGNA, Inc.(a) | | | 484,356 | | | | 7,028,006 | |
| | | | | | | 45,033,792 | |
|
Metals & Mining – 1.8% | |
| | |
Nucor Corp. | | | 55,386 | | | | 8,185,497 | |
| | |
Reliance Steel & Aluminum Co. | | | 30,408 | | | | 7,735,187 | |
| | |
Southern Copper Corp.(a) | | | 102,084 | | | | 7,237,755 | |
| | |
Steel Dynamics, Inc.(a) | | | 26,064 | | | | 2,776,077 | |
| | | | | | | 25,934,516 | |
|
Mortgage Real Estate Investment Trusts (REITs) – 1.4% | |
| | |
AGNC Investment Corp.(a) | | | 842,736 | | | | 6,219,392 | |
| | |
Rithm Capital Corp.(a) | | | 829,704 | | | | 7,741,138 | |
| | |
Starwood Property Trust, Inc.(a) | | | 403,992 | | | | 7,170,858 | |
| | | | | | | 21,131,388 | |
|
Multi-Utilities – 0.6% | |
| | |
Public Service Enterprise Group, Inc.(a) | | | 137,922 | | | | 8,502,891 | |
|
Oil, Gas & Consumable Fuels – 3.3% | |
| | |
Chevron Corp. | | | 35,838 | | | | 5,222,672 | |
| | |
ConocoPhillips | | | 7,602 | | | | 903,118 | |
| | |
Exxon Mobil Corp.(a) | | | 94,482 | | | | 10,000,920 | |
| | |
Marathon Petroleum Corp. | | | 74,934 | | | | 11,333,767 | |
| | |
Peabody Energy Corp.(a) | | | 352,950 | | | | 8,326,090 | |
| | |
Pioneer Natural Resources Co. | | | 10,860 | | | | 2,595,540 | |
| | |
Range Resources Corp.(a) | | | 249,780 | | | | 8,952,115 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Valero Energy Corp.(a) | | | 5,430 | | | $ | 689,610 | |
| | | | | | | 48,023,832 | |
|
Pharmaceuticals – 3.5% | |
| | |
Bristol-Myers Squibb Co. | | | 388,788 | | | | 20,034,246 | |
| | |
Eli Lilly & Co. | | | 15,507 | | | | 8,589,793 | |
| | |
Johnson & Johnson | | | 49,956 | | | | 7,410,473 | |
| | |
Merck & Co., Inc. | | | 23,892 | | | | 2,453,708 | |
| | |
Pfizer, Inc. | | | 7,602 | | | | 232,316 | |
| | |
Zoetis, Inc., Class A | | | 85,794 | | | | 13,469,658 | |
| | | | | | | 52,190,194 | |
|
Professional Services – 2.7% | |
| | |
Automatic Data Processing, Inc. | | | 77,106 | | | | 16,826,071 | |
| | |
Paychex, Inc. | | | 77,106 | | | | 8,562,621 | |
| | |
Paycom Software, Inc. | | | 28,236 | | | | 6,916,973 | |
| | |
Robert Half, Inc. | | | 107,514 | | | | 8,038,822 | |
| | | | | | | 40,344,487 | |
|
Residential REITs – 2.4% | |
| | |
AvalonBay Communities, Inc., REIT | | | 48,870 | | | | 8,099,714 | |
| | |
Camden Property Trust, REIT | | | 66,246 | | | | 5,622,960 | |
| | |
Equity Residential, REIT | | | 137,922 | | | | 7,631,224 | |
| | |
Mid-America Apartment Communities, Inc., REIT | | | 57,558 | | | | 6,800,478 | |
| | |
UDR, Inc., REIT | | | 217,200 | | | | 6,909,132 | |
| | | | | | | 35,063,508 | |
|
Retail REITs – 0.2% | |
| | |
Brixmor Property Group, Inc., REIT(a) | | | 111,858 | | | | 2,325,528 | |
|
Semiconductors & Semiconductor Equipment – 9.0% | |
| | |
Broadcom, Inc. | | | 76,020 | | | | 63,960,948 | |
| | |
KLA Corp.(a) | | | 24,978 | | | | 11,732,167 | |
| | |
Lam Research Corp. | | | 10,860 | | | | 6,388,069 | |
| | |
Microchip Technology, Inc.(a) | | | 108,600 | | | | 7,742,094 | |
| | |
NVIDIA Corp. | | | 74,934 | | | | 30,558,085 | |
| | |
Skyworks Solutions, Inc. | | | 78,192 | | | | 6,782,374 | |
| | |
Teradyne, Inc.(a) | | | 76,020 | | | | 6,330,185 | |
| | | | | | | 133,493,922 | |
See Accompanying Notes to the Financial Statements.
| | | | |
344 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Software – 7.4% | |
| | |
Bentley Systems, Inc., Class B(a) | | | 175,932 | | | $ | 8,557,333 | |
| | |
Dolby Laboratories, Inc., Class A | | | 19,548 | | | | 1,582,215 | |
| | |
Intuit, Inc. | | | 14,981 | | | | 7,414,846 | |
| | |
Microsoft Corp. | | | 272,586 | | | | 92,164,052 | |
| | | | | | | 109,718,446 | |
|
Specialized REITs – 1.4% | |
| | |
CubeSmart, REIT | | | 150,954 | | | | 5,146,022 | |
| | |
Public Storage, REIT(a) | | | 33,666 | | | | 8,036,411 | |
| | |
Weyerhaeuser Co., REIT | | | 267,156 | | | | 7,664,705 | |
| | | | | | | 20,847,138 | |
|
Specialty Retail – 3.9% | |
| | |
Best Buy Co., Inc.(a) | | | 106,428 | | | | 7,111,519 | |
| | |
Home Depot, Inc. (The) | | | 84,708 | | | | 24,115,520 | |
| | |
Lowe’s Cos., Inc. | | | 92,310 | | | | 17,591,517 | |
| | |
Williams-Sonoma, Inc.(a) | | | 62,988 | | | | 9,463,317 | |
| | | | | | | 58,281,873 | |
|
Technology Hardware, Storage & Peripherals – 9.3% | |
| | |
Apple, Inc. | | | 802,554 | | | | 137,052,147 | |
|
Textiles, Apparel & Luxury Goods – 2.0% | |
| | |
NIKE, Inc., Class B | | | 228,060 | | | | 23,437,726 | |
| | |
Tapestry, Inc. | | | 231,318 | | | | 6,375,124 | |
| | | | | | | 29,812,850 | |
|
Tobacco – 0.9% | |
| | |
Altria Group, Inc.(a) | | | 332,316 | | | | 13,349,134 | |
|
Trading Companies & Distributors – 0.6% | |
| | |
Fastenal Co. | | | 153,126 | | | | 8,933,371 | |
Total Common Stocks (Cost $1,330,163,281) | | | | 1,475,944,235 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 8.8%(b) | |
|
CERTIFICATES OF DEPOSIT – 2.3% | |
| | |
Barclays Bank plc, New York (SOFR + 0.32%), 5.48%, 11/24/2023(c) | | $ | 2,000,000 | | | $ | 2,000,186 | |
| | |
Citibank NA, New York (SOFR + 0.40%), 5.62%, 12/15/2023(c) | | | 3,000,000 | | | | 3,000,324 | |
| | |
Credit Industriel et Commercial, London 5.69%, 1/16/2024 | | | 2,000,000 | | | | 1,976,180 | |
| | |
Mizuho Bank Ltd., New York (SOFR + 0.40%), 5.71%, 3/12/2024(c) | | | 2,000,000 | | | | 2,000,576 | |
| | |
MUFG Bank Ltd., London Branch 5.63%, 11/27/2023 | | | 2,000,000 | | | | 2,000,000 | |
| | |
National Westminster Bank PLC 5.88%, 5/2/2024 | | | 2,000,000 | | | | 2,001,340 | |
| | |
Nordea Bank Abp, New York Branch (SOFR + 0.47%), 5.78%, 4/26/2024(c) | | | 2,000,000 | | | | 2,001,552 | |
| | |
Oversea-Chinese Banking Corp. Ltd., New York (SOFR + 0.37%), 5.68%, 11/16/2023(c) | | | 2,000,000 | | | | 2,000,000 | |
| | |
Royal Bank of Canada, New York (SOFR + 0.53%), 5.84%, 5/23/2024(c) | | | 2,000,000 | | | | 2,001,808 | |
| | |
Sumitomo Mitsui Trust Bank Ltd., New York (SOFR + 0.23%), 5.54%, 11/22/2023(c) | | | 3,000,000 | | | | 3,000,000 | |
| | |
Svenska Handelsbanken, New York 5.80%, 4/4/2024 | | | 1,000,000 | | | | 999,882 | |
(SOFR + 0.33%), 5.64%, 4/4/2024(c) | | | 1,000,000 | | | | 999,870 | |
| | |
The Sumitomo Bank Ltd., New York (SOFR + 0.47%), 5.60%, 1/9/2024(c) | | | 2,000,000 | | | | 2,001,226 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 345 | |
FlexShares® Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
CERTIFICATES OF DEPOSIT – (continued) | |
| | |
Toronto-Dominion Bank, New York 5.64%, 2/28/2024 | | $ | 1,000,000 | | | $ | 1,000,000 | |
(US Federal Funds Effective Rate (continuous series) + 0.61%), 5.94%, 7/26/2024(c) | | | 2,000,000 | | | | 2,000,996 | |
| | |
Wells Fargo Bank (San Francisco) NA (SOFR + 0.37%), 5.62%, 12/12/2023(c) | | | 3,000,000 | | | | 3,000,218 | |
Total Certificates of Deposit (Cost $31,978,200) | | | | 31,984,158 | |
| | |
| | | | | | | | |
|
COMMERCIAL PAPER – 0.1%(c) | |
| | |
Bank of Montreal, Montreal (SOFR + 0.35%), 5.66%, 11/9/2023 (Cost $2,000,000) | | | 2,000,000 | | | | 2,000,000 | |
|
INVESTMENT COMPANIES – 1.2% | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 | | | 7,000,000 | | | | 7,000,000 | |
Goldman Sachs Financial Square Government Fund, Institutional Class 5.36%, 11/1/2023 | | | 3,000,000 | | | | 3,000,000 | |
Invesco Government & Agency Portfolio, Institutional Shares 5.36%, 11/1/2023 | | | 4,000,000 | | | | 4,000,000 | |
| | |
Morgan Stanley Institutional Liquidity Fund – Government Portfolio 5.35%, 11/1/2023 | | | 4,000,000 | | | | 4,000,000 | |
Total Investment Companies (Cost $18,000,000) | | | | 18,000,000 | |
| | |
| | | | | | | | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
REPURCHASE AGREEMENTS – 5.2% | |
BofA Securities, Inc., 5.77%, dated 10/31/2023, due 1/31/2024, repurchase price $8,117,964, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 6.13%, maturing 7/15/2024 – 11/15/2044; total market value $8,056,513 | | $ | 8,000,000 | | | $ | 8,000,000 | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $10,001,472, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $10,083,993 | | | 10,000,000 | | | | 10,000,000 | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $9,467,085, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $9,573,333 | | | 9,465,697 | | | | 9,465,697 | |
See Accompanying Notes to the Financial Statements.
| | | | |
346 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – (continued) | |
|
REPURCHASE AGREEMENTS – (continued) | |
MetLife, Inc., 5.32%, dated 10/31/2023, due 11/1/2023, repurchase price $40,005,911, collateralized by various U.S. Treasury Securities, 0.00%, maturing 8/15/2041 – 11/15/2050; total market value $40,288,616 | | $ | 40,000,000 | | | $ | 40,000,000 | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $10,001,506, collateralized by various Common Stocks; total market value $11,075,095 | | | 10,000,000 | | | | 10,000,000 | |
Total Repurchase Agreements (Cost $77,465,697) | | | | 77,465,697 | |
Total Securities Lending Reinvestments (Cost $129,443,897) | | | | 129,449,855 | |
Total Investments – 108.6% (Cost $1,459,607,178) | | | | 1,605,394,090 | |
| |
Liabilities in excess of other assets – (8.6%) | | | | (127,121,274 | ) |
NET ASSETS – 100.0% | | | | | | $ | 1,478,272,816 | |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $149,621,313, collateralized in the form of cash with a value of $129,448,662 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $19,196,387 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $2,514,864 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 4.25%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $151,159,913. |
(b) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $129,449,855. |
(c) | Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2023. |
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
SOFR – Secured Overnight Financing Rate
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 236,307,150 | |
Aggregate gross unrealized depreciation | | | (91,217,525 | ) |
Net unrealized appreciation | | $ | 145,089,625 | |
Federal income tax cost | | $ | 1,460,249,358 | |
Futures Contracts
FlexShares® Quality Dividend Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | | | | | | | | | | | | | | | | |
S&P 500 E-Mini Index | | | 9 | | | | 12/15/2023 | | | | USD | | | $ | 1,895,513 | | | $ | (37,517 | ) |
S&P Midcap 400 E-Mini Index | | | 2 | | | | 12/15/2023 | | | | USD | | | | 475,020 | | | | (17,590 | ) |
| | | | | | | | | | | | | | | | | | $ | (55,107 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 347 | |
FlexShares® Quality Dividend Index Fund (cont.)
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.8 | % |
Securities Lending Reinvestments | | | 8.8 | |
Others(1) | | | (8.6 | ) |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
348 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Quality Dividend Defensive Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 99.5% | |
|
Aerospace & Defense – 1.3% | |
| | |
Lockheed Martin Corp. | | | 8,695 | | | $ | 3,953,095 | |
|
Air Freight & Logistics – 1.0% | |
| | |
CH Robinson Worldwide, Inc.(a) | | | 18,095 | | | | 1,480,714 | |
| | |
Expeditors International of Washington, Inc. | | | 14,805 | | | | 1,617,446 | |
| | | | | | | 3,098,160 | |
|
Banks – 4.6% | |
| | |
Columbia Banking System, Inc. | | | 85,305 | | | | 1,677,949 | |
| | |
Commerce Bancshares, Inc.(a) | | | 33,370 | | | | 1,463,608 | |
| | |
Cullen/Frost Bankers, Inc. | | | 17,625 | | | | 1,603,699 | |
| | |
Glacier Bancorp, Inc.(a) | | | 54,520 | | | | 1,645,959 | |
| | |
JPMorgan Chase & Co. | | | 11,985 | | | | 1,666,634 | |
| | |
Popular, Inc. | | | 25,145 | | | | 1,635,431 | |
| | |
UMB Financial Corp. | | | 25,380 | | | | 1,591,834 | |
| | |
United Bankshares, Inc.(a) | | | 54,990 | | | | 1,563,915 | |
| | |
Zions Bancorp NA(a) | | | 48,175 | | | | 1,486,199 | |
| | | | | | | 14,335,228 | |
|
Beverages – 2.9% | |
| | |
Coca-Cola Co. (The) | | | 152,280 | | | | 8,602,297 | |
| | |
PepsiCo, Inc. | | | 2,585 | | | | 422,079 | |
| | | | | | | 9,024,376 | |
|
Biotechnology – 5.4% | |
| | |
AbbVie, Inc. | | | 57,105 | | | | 8,062,084 | |
| | |
Amgen, Inc. | | | 19,505 | | | | 4,987,429 | |
| | |
Gilead Sciences, Inc. | | | 48,645 | | | | 3,820,578 | |
| | | | | | | 16,870,091 | |
|
Broadline Retail – 0.5% | |
| | |
Dillard’s, Inc., Class A(a) | | | 2,585 | | | | 802,513 | |
| | |
eBay, Inc. | | | 23,735 | | | | 931,124 | |
| | | | | | | 1,733,637 | |
|
Building Products – 0.3% | |
| | |
Masco Corp. | | | 18,800 | | | | 979,292 | |
|
Capital Markets – 1.1% | |
| | |
Bank of New York Mellon Corp. (The) | | | 43,240 | | | | 1,837,700 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Capital Markets – (continued) | |
| | |
Moelis & Co., Class A(a) | | | 37,130 | | | $ | 1,546,093 | |
| | | | | | | 3,383,793 | |
|
Chemicals – 0.8% | |
| | |
LyondellBasell Industries NV, Class A | | | 15,980 | | | | 1,442,035 | |
| | |
Olin Corp. | | | 25,145 | | | | 1,074,195 | |
| | | | | | | 2,516,230 | |
|
Commercial Services & Supplies – 0.5% | |
| | |
Rollins, Inc. | | | 39,480 | | | | 1,484,843 | |
|
Communications Equipment – 2.6% | |
| | |
Cisco Systems, Inc. | | | 158,625 | | | | 8,269,121 | |
|
Consumer Staples Distribution & Retail – 0.1% | |
| | |
Costco Wholesale Corp. | | | 470 | | | | 259,647 | |
| | |
Walmart, Inc. | | | 1,410 | | | | 230,408 | |
| | | | | | | 490,055 | |
|
Containers & Packaging – 0.6% | |
| | |
Packaging Corp. of America | | | 11,985 | | | | 1,834,304 | |
|
Diversified Consumer Services – 0.5% | |
| | |
H&R Block, Inc.(a) | | | 42,065 | | | | 1,726,768 | |
|
Diversified Telecommunication Services – 0.4% | |
| | |
Iridium Communications, Inc. | | | 32,195 | | | | 1,192,825 | |
|
Electric Utilities – 3.2% | |
| | |
Constellation Energy Corp. | | | 17,860 | | | | 2,016,751 | |
| | |
Evergy, Inc. | | | 27,260 | | | | 1,339,556 | |
| | |
Exelon Corp. | | | 44,415 | | | | 1,729,520 | |
| | |
Hawaiian Electric Industries, Inc. | | | 125,960 | | | | 1,634,961 | |
| | |
OGE Energy Corp.(a) | | | 49,820 | | | | 1,703,844 | |
| | |
PPL Corp. | | | 70,500 | | | | 1,732,185 | |
| | | | | | | 10,156,817 | |
|
Entertainment – 1.1% | |
| | |
Electronic Arts, Inc. | | | 15,745 | | | | 1,949,074 | |
| | |
Warner Music Group Corp., Class A(a) | | | 47,235 | | | | 1,478,455 | |
| | | | | | | 3,427,529 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 349 | |
FlexShares® Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Financial Services – 2.2% | |
| | |
Fidelity National Information Services, Inc. | | | 33,840 | | | $ | 1,661,882 | |
| | |
Mastercard, Inc., Class A | | | 2,350 | | | | 884,423 | |
| | |
Radian Group, Inc.(a) | | | 62,745 | | | | 1,589,958 | |
| | |
Visa, Inc., Class A(a) | | | 5,640 | | | | 1,325,964 | |
| | |
Western Union Co. (The) | | | 140,295 | | | | 1,583,931 | |
| | | | | | | 7,046,158 | |
|
Food Products – 0.9% | |
| | |
General Mills, Inc. | | | 23,030 | | | | 1,502,477 | |
| | |
Kellogg Co.(a) | | | 28,670 | | | | 1,446,975 | |
| | | | | | | 2,949,452 | |
|
Gas Utilities – 0.4% | |
| | |
ONE Gas, Inc.(a) | | | 18,565 | | | | 1,121,326 | |
|
Ground Transportation – 0.6% | |
| | |
Old Dominion Freight Line, Inc. | | | 4,700 | | | | 1,770,302 | |
|
Health Care Equipment & Supplies – 2.0% | |
| | |
Abbott Laboratories | | | 67,445 | | | | 6,376,925 | |
|
Health Care Providers & Services – 4.4% | |
| | |
Cardinal Health, Inc. | | | 20,210 | | | | 1,839,110 | |
| | |
Cencora, Inc.(a) | | | 10,340 | | | | 1,914,451 | |
| | |
Chemed Corp.(a) | | | 3,290 | | | | 1,851,119 | |
| | |
Cigna Group (The) | | | 11,515 | | | | 3,560,438 | |
| | |
McKesson Corp. | | | 5,170 | | | | 2,354,211 | |
| | |
UnitedHealth Group, Inc. | | | 3,995 | | | | 2,139,562 | |
| | | | | | | 13,658,891 | |
|
Health Care REITs – 0.4% | |
| | |
Healthpeak Properties, Inc., REIT | | | 85,070 | | | | 1,322,838 | |
|
Hotels, Restaurants & Leisure – 3.6% | |
| | |
Domino’s Pizza, Inc. | | | 4,465 | | | | 1,513,590 | |
| | |
McDonald’s Corp. | | | 21,855 | | | | 5,729,726 | |
| | |
Starbucks Corp. | | | 44,650 | | | | 4,118,516 | |
| | | | | | | 11,361,832 | |
|
Household Products – 4.2% | |
| | |
Clorox Co. (The) | | | 11,750 | | | | 1,382,975 | |
| | |
Kimberly-Clark Corp. | | | 7,520 | | | | 899,693 | |
| | |
Procter & Gamble Co. (The) | | | 71,910 | | | | 10,788,657 | |
| | | | | | | 13,071,325 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Independent Power and Renewable Electricity Producers – 0.5% | |
| | |
Clearway Energy, Inc., Class C | | | 68,855 | | | $ | 1,494,842 | |
|
Industrial Conglomerates – 0.8% | |
| | |
Honeywell International, Inc. | | | 13,630 | | | | 2,497,834 | |
|
Insurance – 4.0% | |
| | |
Aflac, Inc. | | | 26,320 | | | | 2,055,855 | |
| | |
Allstate Corp. (The) | | | 13,395 | | | | 1,716,301 | |
| | |
American Financial Group, Inc. | | | 14,805 | | | | 1,619,075 | |
| | |
Loews Corp. | | | 27,965 | | | | 1,790,040 | |
| | |
MetLife, Inc. | | | 27,025 | | | | 1,621,770 | |
| | |
Old Republic International Corp. | | | 62,040 | | | | 1,698,655 | |
| | |
Willis Towers Watson plc | | | 8,930 | | | | 2,106,498 | |
| | | | | | | 12,608,194 | |
|
IT Services – 1.1% | |
| | |
Amdocs Ltd. | | | 19,740 | | | | 1,582,358 | |
| | |
Cognizant Technology Solutions Corp., Class A | | | 27,730 | | | | 1,787,753 | |
| | | | | | | 3,370,111 | |
|
Machinery – 1.4% | |
| | |
Illinois Tool Works, Inc. | | | 11,750 | | | | 2,633,410 | |
| | |
Otis Worldwide Corp. | | | 21,855 | | | | 1,687,425 | |
| | | | | | | 4,320,835 | |
|
Media – 3.1% | |
| | |
Comcast Corp., Class A | | | 67,680 | | | | 2,794,507 | |
| | |
Fox Corp., Class A | | | 10,575 | | | | 321,374 | |
| | |
New York Times Co. (The), Class A | | | 39,715 | | | | 1,600,912 | |
| | |
Nexstar Media Group, Inc., Class A(a) | | | 10,340 | | | | 1,448,427 | |
| | |
Omnicom Group, Inc. | | | 21,855 | | | | 1,637,158 | |
| | |
Sirius XM Holdings, Inc.(a) | | | 91,885 | | | | 393,268 | |
| | |
TEGNA, Inc.(a) | | | 99,875 | | | | 1,449,186 | |
| | | | | | | 9,644,832 | |
|
Metals & Mining – 1.0% | |
| | |
Reliance Steel & Aluminum Co. | | | 6,345 | | | | 1,614,041 | |
| | |
Southern Copper Corp. | | | 21,385 | | | | 1,516,197 | |
| | | | | | | 3,130,238 | |
See Accompanying Notes to the Financial Statements.
| | | | |
350 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Mortgage Real Estate Investment Trusts (REITs) – 0.8% | |
| | |
AGNC Investment Corp.(a) | | | 172,960 | | | $ | 1,276,445 | |
| | |
Starwood Property Trust, Inc.(a) | | | 70,500 | | | | 1,251,375 | |
| | | | | | | 2,527,820 | |
|
Multi-Utilities – 1.4% | |
| | |
Consolidated Edison, Inc. | | | 21,150 | | | | 1,856,758 | |
| | |
Dominion Energy, Inc. | | | 13,630 | | | | 549,562 | |
| | |
Public Service Enterprise Group, Inc. | | | 30,785 | | | | 1,897,895 | |
| | | | | | | 4,304,215 | |
|
Oil, Gas & Consumable Fuels – 1.4% | |
| | |
Chevron Corp.(a) | | | 7,285 | | | | 1,061,643 | |
| | |
Coterra Energy, Inc. | | | 10,105 | | | | 277,887 | |
| | |
CVR Energy, Inc.(a) | | | 7,285 | | | | 238,584 | |
| | |
Exxon Mobil Corp. | | | 22,560 | | | | 2,387,976 | |
| | |
Pioneer Natural Resources Co. | | | 1,410 | | | | 336,990 | |
| | | | | | | 4,303,080 | |
|
Pharmaceuticals – 3.9% | |
| | |
Bristol-Myers Squibb Co. | | | 81,075 | | | | 4,177,795 | |
| | |
Eli Lilly & Co. | | | 7,990 | | | | 4,425,901 | |
| | |
Johnson & Johnson | | | 16,685 | | | | 2,475,053 | |
| | |
Merck & Co., Inc. | | | 6,110 | | | | 627,497 | |
| | |
Pfizer, Inc. | | | 1,410 | | | | 43,089 | |
| | |
Zoetis, Inc., Class A | | | 2,585 | | | | 405,845 | |
| | | | | | | 12,155,180 | |
|
Professional Services – 2.3% | |
| | |
Automatic Data Processing, Inc. | | | 15,980 | | | | 3,487,156 | |
| | |
Paychex, Inc. | | | 15,980 | | | | 1,774,579 | |
| | |
Verisk Analytics, Inc., Class A | | | 8,225 | | | | 1,870,036 | |
| | | | | | | 7,131,771 | |
|
Residential REITs – 3.1% | |
| | |
American Homes 4 Rent, Class A, REIT | | | 49,820 | | | | 1,631,107 | |
| | |
AvalonBay Communities, Inc., REIT | | | 4,935 | | | | 817,927 | |
| | |
Camden Property Trust, REIT | | | 13,630 | | | | 1,156,914 | |
| | |
Equity Residential, REIT | | | 28,435 | | | | 1,573,309 | |
| | |
Essex Property Trust, Inc., REIT | | | 7,520 | | | | 1,608,678 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Residential REITs – (continued) | |
| | |
Mid-America Apartment Communities, Inc., REIT | | | 12,220 | | | $ | 1,443,793 | |
| | |
UDR, Inc., REIT(a) | | | 45,120 | | | | 1,435,267 | |
| | | | | | | 9,666,995 | |
|
Semiconductors & Semiconductor Equipment – 6.3% | |
| | |
Broadcom, Inc. | | | 15,980 | | | | 13,445,093 | |
| | |
NVIDIA Corp. | | | 15,745 | | | | 6,420,811 | |
| | | | | | | 19,865,904 | |
|
Software – 7.4% | |
| | |
Bentley Systems, Inc., Class B(a) | | | 37,130 | | | | 1,806,003 | |
| | |
Dolby Laboratories, Inc., Class A | | | 4,465 | | | | 361,397 | |
| | |
Intuit, Inc. | | | 3,525 | | | | 1,744,699 | |
| | |
Microsoft Corp. | | | 56,635 | | | | 19,148,860 | |
| | | | | | | 23,060,959 | |
|
Specialized REITs – 0.9% | |
| | |
CubeSmart, REIT | | | 35,720 | | | | 1,217,695 | |
| | |
Public Storage, REIT | | | 7,285 | | | | 1,739,002 | |
| | | | | | | 2,956,697 | |
|
Specialty Retail – 4.7% | |
| | |
Best Buy Co., Inc. | | | 19,035 | | | | 1,271,919 | |
| | |
Home Depot, Inc. (The) | | | 32,195 | | | | 9,165,594 | |
| | |
Lowe’s Cos., Inc. | | | 7,520 | | | | 1,433,086 | |
| | |
Murphy USA, Inc. | | | 4,465 | | | | 1,619,411 | |
| | |
Williams-Sonoma, Inc.(a) | | | 8,695 | | | | 1,306,337 | |
| | | | | | | 14,796,347 | |
|
Technology Hardware, Storage & Peripherals – 7.8% | |
| | |
Apple, Inc. | | | 142,880 | | | | 24,399,618 | |
|
Tobacco – 0.9% | |
| | |
Altria Group, Inc. | | | 69,090 | | | | 2,775,345 | |
|
Trading Companies & Distributors – 1.1% | |
| | |
Fastenal Co. | | | 33,135 | | | | 1,933,096 | |
| | |
MSC Industrial Direct Co., Inc., Class A(a) | | | 16,685 | | | | 1,580,904 | |
| | | | | | | 3,514,000 | |
Total Common Stocks (Cost $287,654,026) | | | | 311,680,030 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 351 | |
FlexShares® Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SECURITIES LENDING REINVESTMENTS – 6.0%(b) | |
|
INVESTMENT COMPANIES – 0.3% | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 (Cost $1,000,000) | | $ | 1,000,000 | | | $ | 1,000,000 | |
|
REPURCHASE AGREEMENTS – 5.7% | |
| | |
BofA Securities, Inc., 5.77%, dated 10/31/2023, due 1/31/2024, repurchase price $1,014,746, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 6.13%, maturing 7/15/2024 – 11/15/2044; total market value $1,007,064 | | | 1,000,000 | | | | 1,000,000 | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $5,000,736, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 – 5/15/2051; total market value $5,041,997 | | | 5,000,000 | | | | 5,000,000 | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $7,784,824, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $7,872,192 | | | 7,783,683 | | | | 7,783,683 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
REPURCHASE AGREEMENTS – (continued) | |
| | |
TD Prime Services LLC, 5.42%, dated 10/31/2023, due 11/1/2023, repurchase price $4,000,602, collateralized by various Common Stocks; total market value $4,430,038 | | $ | 4,000,000 | | | $ | 4,000,000 | |
Total Repurchase Agreements (Cost $17,783,683) | | | | 17,783,683 | |
Total Securities Lending Reinvestments (Cost $18,783,683) | | | | 18,783,683 | |
Total Investments – 105.5% (Cost $306,437,709) | | | | 330,463,713 | |
| |
Liabilities in excess of other assets – (5.5%) | | | | (17,232,615 | ) |
NET ASSETS – 100.0% | | | $ | 313,231,098 | |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $26,472,637, collateralized in the form of cash with a value of $18,783,683 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $6,786,441 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 7.63%, and maturity dates ranging from November 7, 2023 – August 15, 2053 and $1,595,285 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 4.50%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $27,165,409. |
(b) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $18,783,683. |
Percentages shown are based on Net Assets.
Abbreviations
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 42,388,210 | |
Aggregate gross unrealized depreciation | | | (18,364,097 | ) |
Net unrealized appreciation | | $ | 24,024,113 | |
Federal income tax cost | | $ | 306,369,017 | |
See Accompanying Notes to the Financial Statements.
| | | | |
352 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Quality Dividend Defensive Index Fund (cont.)
Futures Contracts
FlexShares® Quality Dividend Defensive Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
S&P 500 E-Mini Index | | | 7 | | | | 12/15/2023 | | | | USD | | | $ | 1,474,288 | | | $ | (70,583 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 99.5 | % |
Securities Lending Reinvestments | | | 6.0 | |
Others(1) | | | (5.5 | ) |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 353 | |
Schedule of Investments
FlexShares® International Quality Dividend Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.2% | |
|
Air Freight & Logistics – 0.1% | |
| | |
SG Holdings Co. Ltd. | | | 39,700 | | | $ | 558,885 | |
|
Automobile Components – 0.2% | |
| | |
Fuyao Glass Industry Group Co. Ltd., Class H(a) | | | 243,600 | | | | 1,109,877 | |
|
Automobiles – 2.7% | |
| | |
Dr Ing hc F Porsche AG (Preference)(b) | | | 36,873 | | | | 3,216,977 | |
| | |
Isuzu Motors Ltd. | | | 337,400 | | | | 3,699,381 | |
| | |
Mercedes-Benz Group AG | | | 87,483 | | | | 5,125,586 | |
| | |
Subaru Corp. | | | 31,700 | | | | 535,747 | |
| | |
Yadea Group Holdings Ltd.(a) | | | 482,000 | | | | 880,888 | |
| | | | | | | 13,458,579 | |
|
Banks – 12.0% | |
| | |
Akbank TAS | | | 256,906 | | | | 267,505 | |
| | |
Banco del Bajio SA(a) | | | 1,253,200 | | | | 3,830,476 | |
| | |
Bank of Montreal | | | 27,474 | | | | 2,073,834 | |
| | |
Barclays plc | | | 1,985,117 | | | | 3,170,034 | |
| | |
BOC Hong Kong Holdings Ltd. | | | 964,000 | | | | 2,550,265 | |
| | |
China Construction Bank Corp., Class H | | | 4,820,000 | | | | 2,735,066 | |
| | |
China Merchants Bank Co. Ltd., Class H | | | 677,000 | | | | 2,578,355 | |
| | |
FinecoBank Banca Fineco SpA | | | 230,878 | | | | 2,712,483 | |
| | |
First Abu Dhabi Bank PJSC | | | 586,353 | | | | 2,024,219 | |
| | |
HSBC Holdings plc | | | 102,666 | | | | 737,888 | |
| | |
Industrial & Commercial Bank of China Ltd., Class H | | | 4,097,000 | | | | 1,968,755 | |
| | |
Japan Post Bank Co. Ltd. | | | 168,700 | | | | 1,558,953 | |
| | |
KBC Group NV | | | 62,419 | | | | 3,424,200 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | 289,200 | | | | 2,400,372 | |
| | |
Nordea Bank Abp | | | 309,685 | | | | 3,251,337 | |
| | |
Royal Bank of Canada | | | 152,071 | | | | 12,132,817 | |
| | |
Sberbank of Russia PJSC‡ | | | 1,227,390 | | | | — | |
| | |
Skandinaviska Enskilda Banken AB, Class A | | | 349,209 | | | | 3,885,084 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | 58,100 | | | $ | 2,769,864 | |
| | |
Swedbank AB, Class A | | | 216,177 | | | | 3,535,987 | |
| | |
Toronto-Dominion Bank (The) | | | 5,302 | | | | 295,835 | |
| | |
Yapi ve Kredi Bankasi A/S | | | 2,895,374 | | | | 1,764,277 | |
| | | | | | | 59,667,606 | |
|
Beverages – 0.8% | |
| | |
Arca Continental SAB de CV | | | 385,600 | | | | 3,453,163 | |
| | |
Nongfu Spring Co. Ltd., Class H(b)(c) | | | 76,600 | | | | 436,128 | |
| | | | | | | 3,889,291 | |
|
Broadline Retail – 0.2% | |
| | |
B&M European Value Retail SA | | | 49,405 | | | | 317,018 | |
| | |
Next plc | | | 8,676 | | | | 724,740 | |
| | | | | | | 1,041,758 | |
|
Building Products – 0.4% | |
| | |
Geberit AG (Registered) | | | 4,338 | | | | 2,010,624 | |
|
Capital Markets – 4.9% | |
| | |
3i Group plc | | | 147,251 | | | | 3,456,598 | |
| | |
Brookfield Asset Management Ltd., Class A | | | 42,175 | | | | 1,207,604 | |
| | |
China Galaxy Securities Co. Ltd., Class H | | | 6,748,000 | | | | 3,449,633 | |
| | |
Hong Kong Exchanges & Clearing Ltd. | | | 2,700 | | | | 94,893 | |
| | |
Japan Exchange Group, Inc. | | | 106,900 | | | | 2,092,542 | |
| | |
Julius Baer Group Ltd. | | | 42,175 | | | | 2,484,017 | |
| | |
Macquarie Korea Infrastructure Fund | | | 392,348 | | | | 3,491,928 | |
| | |
Moscow Exchange MICEX-RTS PJSC‡ | | | 775,590 | | | | — | |
| | |
Partners Group Holding AG | | | 4,097 | | | | 4,307,466 | |
| | |
Samsung Securities Co. Ltd. | | | 140,985 | | | | 3,684,996 | |
| | | | | | | 24,269,677 | |
|
Chemicals – 2.9% | |
| | |
Fertiglobe plc | | | 3,852,144 | | | | 3,366,562 | |
| | |
Nissan Chemical Corp. | | | 10,400 | | | | 418,555 | |
See Accompanying Notes to the Financial Statements.
| | | | |
354 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Chemicals – (continued) | |
| | |
Nitto Denko Corp.(c) | | | 17,300 | | | $ | 1,106,117 | |
| | |
Sahara International Petrochemical Co. | | | 170,146 | | | | 1,462,632 | |
| | |
Shin-Etsu Chemical Co. Ltd. | | | 120,500 | | | | 3,555,046 | |
| | |
Wacker Chemie AG | | | 6,989 | | | | 853,242 | |
| | |
Yara International ASA | | | 107,727 | | | | 3,519,639 | |
| | | | | | | 14,281,793 | |
|
Consumer Staples Distribution & Retail – 0.4% | |
| | |
Coles Group Ltd. | | | 217,382 | | | | 2,101,693 | |
| | |
Kesko OYJ, Class B | | | 1,928 | | | | 32,535 | |
| | | | | | | 2,134,228 | |
|
Diversified REITs – 0.5% | |
| | |
Stockland, REIT | | | 1,183,551 | | | | 2,652,753 | |
|
Diversified Telecommunication Services – 1.8% | |
| | |
Elisa OYJ | | | 6,748 | | | | 285,876 | |
| | |
Koninklijke KPN NV | | | 698,418 | | | | 2,343,873 | |
| | |
Spark New Zealand Ltd. | | | 67,962 | | | | 196,465 | |
| | |
Swisscom AG (Registered) | | | 3,856 | | | | 2,304,999 | |
| | |
Telstra Group Ltd. | | | 1,609,398 | | | | 3,882,353 | |
| | | | | | | 9,013,566 | |
|
Electric Utilities – 1.3% | |
| | |
Fortum OYJ(c) | | | 238,590 | | | | 2,824,524 | |
| | |
Origin Energy Ltd. | | | 548,275 | | | | 3,169,391 | |
| | |
Power Grid Corp. of India Ltd. | | | 256,748 | | | | 623,377 | |
| | | | | | | 6,617,292 | |
|
Electrical Equipment – 0.0%(d) | |
| | |
Voltronic Power Technology Corp. | | | 4,839 | | | | 193,202 | |
|
Electronic Equipment, Instruments & Components – 0.1% | |
| | |
Largan Precision Co. Ltd. | | | 4,000 | | | | 255,280 | |
| | |
Shimadzu Corp. | | | 13,200 | | | | 308,983 | |
| | | | | | | 564,263 | |
|
Entertainment – 1.0% | |
| | |
Capcom Co. Ltd.(c) | | | 10,400 | | | | 332,303 | |
| | |
Nintendo Co. Ltd. | | | 115,300 | | | | 4,736,249 | |
| | | | | | | 5,068,552 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Financial Services – 3.0% | |
| | |
Banca Mediolanum SpA | | | 434,764 | | | $ | 3,541,258 | |
| | |
FirstRand Ltd. | | | 60,250 | | | | 197,460 | |
| | |
ORIX Corp. | | | 187,000 | | | | 3,352,405 | |
| | |
Power Finance Corp. Ltd. | | | 1,136,618 | | | | 3,366,493 | |
| | |
REC Ltd. | | | 1,368,880 | | | | 4,728,511 | |
| | | | | | | 15,186,127 | |
|
Food Products – 3.2% | |
| | |
China Feihe Ltd.(a) | | | 3,374,000 | | | | 2,095,652 | |
| | |
Nestle SA (Registered) | | | 89,893 | | | | 9,686,179 | |
| | |
Uni-President China Holdings Ltd. | | | 4,338,000 | | | | 2,954,981 | |
| | |
Want Want China Holdings Ltd. | | | 1,928,000 | | | | 1,197,516 | |
| | | | | | | 15,934,328 | |
|
Gas Utilities – 0.9% | |
| | |
Kunlun Energy Co. Ltd. | | | 682,000 | | | | 568,290 | |
| | |
Naturgy Energy Group SA(c) | | | 132,068 | | | | 3,727,210 | |
| | | | | | | 4,295,500 | |
|
Ground Transportation – 0.0%(d) | |
| | |
Canadian National Railway Co. | | | 1,446 | | | | 152,834 | |
|
Health Care Equipment & Supplies – 0.3% | |
| | |
Hoya Corp. | | | 13,400 | | | | 1,268,375 | |
|
Health Care Providers & Services – 0.0%(d) | |
| | |
Sonic Healthcare Ltd. | | | 11,327 | | | | 206,186 | |
|
Hotels, Restaurants & Leisure – 1.1% | |
| | |
InterContinental Hotels Group plc | | | 25,546 | | | | 1,801,030 | |
| | |
OPAP SA | | | 227,263 | | | | 3,843,472 | |
| | | | | | | 5,644,502 | |
|
Household Durables – 0.6% | |
| | |
Nien Made Enterprise Co. Ltd. | | | 326,000 | | | | 2,874,549 | |
|
Household Products – 0.4% | |
| | |
Unilever Indonesia Tbk. PT | | | 9,712,300 | | | | 2,213,316 | |
|
Independent Power and Renewable Electricity Producers – 0.0% | |
| | |
Unipro PJSC*‡ | | | 125,500,000 | | | | — | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 355 | |
FlexShares® International Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Industrial Conglomerates – 0.7% | |
| | |
Hitachi Ltd. | | | 29,700 | | | $ | 1,858,542 | |
| | |
Industries Qatar QSC | | | 441,512 | | | | 1,481,812 | |
| | |
Siemens AG (Registered) | | | 1,687 | | | | 222,823 | |
| | | | | | | 3,563,177 | |
|
Insurance – 2.0% | |
| | |
Admiral Group plc | | | 58,804 | | | | 1,743,220 | |
| | |
BB Seguridade Participacoes SA | | | 650,700 | | | | 3,968,973 | |
| | |
Caixa Seguridade Participacoes SA | | | 433,800 | | | | 930,739 | |
| | |
Manulife Financial Corp. | | | 150,384 | | | | 2,614,997 | |
| | |
Sampo OYJ, Class A | | | 12,532 | | | | 491,571 | |
| | | | | | | 9,749,500 | |
|
Interactive Media & Services – 1.0% | |
| | |
Rightmove plc(c) | | | 274,258 | | | | 1,574,136 | |
| | |
Tencent Holdings Ltd. | | | 96,400 | | | | 3,562,979 | |
| | | | | | | 5,137,115 | |
|
IT Services – 1.3% | |
| | |
HCL Technologies Ltd. | | | 173,520 | | | | 2,659,318 | |
| | |
Infosys Ltd. | | | 64,106 | | | | 1,053,615 | |
| | |
Nomura Research Institute Ltd. | | | 72,300 | | | | 1,882,870 | |
| | |
Obic Co. Ltd. | | | 5,200 | | | | 763,802 | |
| | | | | | | 6,359,605 | |
|
Leisure Products – 0.0%(d) | |
| | |
Shimano, Inc. | | | 600 | | | | 85,397 | |
|
Machinery – 1.1% | |
| | |
GEA Group AG | | | 13,255 | | | | 451,560 | |
| | |
Kone OYJ, Class B | | | 64,347 | | | | 2,781,124 | |
| | |
MISUMI Group, Inc. | | | 66,300 | | | | 989,170 | |
| | |
VAT Group AG(a) | | | 3,133 | | | | 1,104,064 | |
| | | | | | | 5,325,918 | |
|
Marine Transportation – 3.1% | |
| | |
AP Moller – Maersk A/S, Class A | | | 1,446 | | | | 2,354,932 | |
| | |
AP Moller – Maersk A/S, Class B | | | 1,446 | | | | 2,401,007 | |
| | |
Evergreen Marine Corp. Taiwan Ltd. | | | 1,205,000 | | | | 3,993,757 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Marine Transportation – (continued) | |
| | |
Hapag-Lloyd AG(a) | | | 482 | | | $ | 69,339 | |
| | |
Nippon Yusen KK(c) | | | 63,600 | | | | 1,544,172 | |
| | |
Orient Overseas International Ltd.(c) | | | 209,500 | | | | 2,641,308 | |
| | |
SITC International Holdings Co. Ltd.(c) | | | 624,000 | | | | 960,172 | |
| | |
Yang Ming Marine Transport Corp. | | | 964,000 | | | | 1,251,253 | |
| | | | | | | 15,215,940 | |
|
Metals & Mining – 6.7% | |
| | |
BHP Group Ltd. | | | 555,746 | | | | 15,658,241 | |
| | |
Glencore plc | | | 89,652 | | | | 473,392 | |
| | |
Grupo Mexico SAB de CV, Series B | | | 578,400 | | | | 2,355,827 | |
| | |
Kumba Iron Ore Ltd. | | | 132,791 | | | | 3,497,904 | |
| | |
MMC Norilsk Nickel PJSC*‡ | | | 16,315 | | | | — | |
| | |
Norsk Hydro ASA | | | 14,942 | | | | 85,171 | |
| | |
Rio Tinto plc | | | 124,838 | | | | 7,960,520 | |
| | |
Severstal PAO*‡ | | | 58,985 | | | | — | |
| | |
Vedanta Ltd. | | | 1,352,010 | | | | 3,517,292 | |
| | | | | | | 33,548,347 | |
|
Multi-Utilities – 0.0%(d) | |
| | |
Canadian Utilities Ltd., Class A | | | 7,471 | | | | 157,896 | |
|
Oil, Gas & Consumable Fuels – 8.8% | |
| | |
Adaro Energy Indonesia Tbk. PT | | | 17,448,400 | | | | 2,811,955 | |
| | |
Canadian Natural Resources Ltd.(c) | | | 120,500 | | | | 7,643,602 | |
| | |
China Shenhua Energy Co. Ltd., Class H | | | 1,205,000 | | | | 3,696,036 | |
| | |
Coal India Ltd. | | | 1,332,971 | | | | 5,031,137 | |
| | |
Equinor ASA | | | 112,788 | | | | 3,780,397 | |
| | |
Exxaro Resources Ltd. | | | 456,695 | | | | 4,554,550 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 698,900 | | | | 4,814,552 | |
| | |
Shell plc | | | 61,455 | | | | 1,973,563 | |
| | |
TotalEnergies SE | | | 13,737 | | | | 917,665 | |
| | |
Var Energi ASA | | | 1,319,475 | | | | 4,444,430 | |
| | |
Yankuang Energy Group Co. Ltd., Class H(c) | | | 2,410,000 | | | | 4,188,840 | |
| | | | | | | 43,856,727 | |
See Accompanying Notes to the Financial Statements.
| | | | |
356 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Passenger Airlines – 0.7% | |
| | |
Singapore Airlines Ltd. | | | 723,000 | | | $ | 3,224,357 | |
|
Personal Care Products – 2.4% | |
| | |
Hengan International Group Co. Ltd. | | | 120,500 | | | | 403,484 | |
| | |
L’Oreal SA | | | 26,751 | | | | 11,201,461 | |
| | |
Unilever plc | | | 8,917 | | | | 420,803 | |
| | | | | | | 12,025,748 | |
|
Pharmaceuticals – 9.1% | |
| | |
Astellas Pharma, Inc. | | | 24,100 | | | | 302,354 | |
| | |
AstraZeneca plc | | | 16,388 | | | | 2,038,317 | |
| | |
China Medical System Holdings Ltd. | | | 964,000 | | | | 1,540,015 | |
| | |
GSK plc | | | 403,916 | | | | 7,143,182 | |
| | |
Novartis AG (Registered) | | | 108,932 | | | | 10,119,346 | |
| | |
Novo Nordisk A/S, Class B | | | 154,722 | | | | 14,833,820 | |
| | |
Orion OYJ, Class B | | | 3,856 | | | | 153,005 | |
| | |
Roche Holding AG | | | 723 | | | | 196,391 | |
| | |
Roche Holding AG – BR | | | 34,945 | | | | 8,979,603 | |
| | |
Sanofi SA | | | 2,169 | | | | 196,479 | |
| | | | | | | 45,502,512 | |
|
Professional Services – 2.5% | |
| | |
Bureau Veritas SA | | | 146,528 | | | | 3,328,373 | |
| | |
Randstad NV | | | 66,516 | | | | 3,433,814 | |
| | |
Recruit Holdings Co. Ltd. | | | 48,200 | | | | 1,379,053 | |
| | |
RELX plc | | | 64,588 | | | | 2,247,775 | |
| | |
SGS SA (Registered) | | | 27,715 | | | | 2,253,014 | |
| | | | | | | 12,642,029 | |
|
Real Estate Management & Development – 2.2% | |
| | |
China Vanke Co. Ltd., Class H | | | 2,626,900 | | | | 2,457,494 | |
| | |
CK Asset Holdings Ltd. | | | 120,500 | | | | 602,146 | |
| | |
Daito Trust Construction Co. Ltd. | | | 34,700 | | | | 3,700,386 | |
| | |
Land & Houses PCL, NVDR | | | 5,302,000 | | | | 1,113,726 | |
| | |
Sun Hung Kai Properties Ltd. | | �� | 309,500 | | | | 3,178,223 | |
| | | | | | | 11,051,975 | |
|
Retail REITs – 0.8% | |
| | |
Link REIT, REIT | | | 843,500 | | | | 3,870,057 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Semiconductors & Semiconductor Equipment – 6.1% | |
| | |
Advantest Corp. | | | 91,700 | | | $ | 2,309,984 | |
| | |
ASML Holding NV | | | 12,291 | | | | 7,344,144 | |
| | |
MediaTek, Inc. | | | 213,946 | | | | 5,553,955 | |
| | |
Novatek Microelectronics Corp. | | | 331,901 | | | | 4,650,810 | |
| | |
Realtek Semiconductor Corp. | | | 85,000 | | | | 1,052,181 | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 399,222 | | | | 6,511,128 | |
| | |
Tokyo Electron Ltd. | | | 18,600 | | | | 2,426,247 | |
| | |
Vanguard International Semiconductor Corp. | | | 302,000 | | | | 652,696 | |
| | | | | | | 30,501,145 | |
|
Software – 0.4% | |
| | |
SAP SE | | | 5,061 | | | | 677,993 | |
| | |
Temenos AG (Registered) | | | 17,593 | | | | 1,259,280 | |
| | | | | | | 1,937,273 | |
|
Specialty Retail – 1.4% | |
| | |
Fast Retailing Co. Ltd. | | | 600 | | | | 130,819 | |
| | |
H & M Hennes & Mauritz AB, Class B(c) | | | 117,849 | | | | 1,574,815 | |
| | |
Industria de Diseno Textil SA(c) | | | 125,802 | | | | 4,328,262 | |
| | |
Topsports International Holdings Ltd.(a) | | | 964,000 | | | | 810,664 | |
| | | | | | | 6,844,560 | |
|
Technology Hardware, Storage & Peripherals – 1.1% | |
| | |
Catcher Technology Co. Ltd. | | | 214,000 | | | | 1,197,503 | |
| | |
Lite-On Technology Corp. | | | 482,000 | | | | 1,486,049 | |
| | |
Samsung Electronics Co. Ltd. | | | 53,743 | | | | 2,662,179 | |
| | | | | | | 5,345,731 | |
|
Textiles, Apparel & Luxury Goods – 3.1% | |
| | |
ANTA Sports Products Ltd. | | | 144,600 | | | | 1,632,724 | |
| | |
Bosideng International Holdings Ltd. | | | 6,106,000 | | | | 2,411,310 | |
| | |
Burberry Group plc | | | 48,923 | | | | 1,004,466 | |
| | |
Feng TAY Enterprise Co. Ltd. | | | 21,284 | | | | 117,133 | |
| | |
Hermes International SCA | | | 3,248 | | | | 6,040,946 | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 3,374 | | | | 2,405,482 | |
| | |
Pandora A/S | | | 5,302 | | | | 599,327 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 357 | |
FlexShares® International Quality Dividend Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Textiles, Apparel & Luxury Goods – (continued) | |
| | |
Shenzhou International Group Holdings Ltd. | | | 120,500 | | | $ | 1,181,961 | |
| | | | | | | 15,393,349 | |
|
Tobacco – 1.7% | |
| | |
Imperial Brands plc | | | 185,329 | | | | 3,937,780 | |
| | |
Japan Tobacco, Inc. | | | 201,900 | | | | 4,694,046 | |
| | | | | | | 8,631,826 | |
|
Trading Companies & Distributors – 2.3% | |
| | |
Howden Joinery Group plc | | | 369,694 | | | | 2,860,307 | |
| | |
ITOCHU Corp.(c) | | | 120,500 | | | | 4,275,126 | |
| | |
Marubeni Corp. | | | 72,300 | | | | 1,039,780 | |
| | |
Mitsubishi Corp. | | | 45,600 | | | | 2,094,146 | |
| | |
Mitsui & Co. Ltd. | | | 30,500 | | | | 1,090,947 | |
| | | | | | | 11,360,306 | |
|
Wireless Telecommunication Services – 0.9% | |
| | |
Intouch Holdings PCL, NVDR | | | 216,900 | | | | 428,459 | |
| | |
KDDI Corp. | | | 24,100 | | | | 714,033 | |
| | |
Tele2 AB, Class B | | | 449,706 | | | | 3,185,434 | |
| | | | | | | 4,327,926 | |
TOTAL COMMON STOCKS (COST $509,465,426) | | | | 489,966,079 | |
| | |
| | | | | | | | |
|
SECURITIES LENDING REINVESTMENTS – 0.4%(e) | |
|
INVESTMENT COMPANIES – 0.4% | |
| | |
Dreyfus Treasury Obligations Cash Management Fund 5.38%, 11/1/2023 (Cost $2,000,000) | | | 2,000,000 | | | | 2,000,000 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
REPURCHASE AGREEMENTS – 0.0%(d) | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $149,596, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $151,275 (Cost $149,574) | | | 149,574 | | | $ | 149,574 | |
TOTAL SECURITIES LENDING REINVESTMENTS (COST $2,149,574) | | | | 2,149,574 | |
Total Investments – 98.6% (Cost $511,615,000) | | | | 492,115,653 | |
| |
Other assets less liabilities – 1.4% | | | | 6,760,261 | |
NET ASSETS – 100.0% | | | | | | $ | 498,875,914 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(c) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $24,751,395, collateralized in the form of cash with a value of $2,149,574 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $21,621,538 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.13%, and maturity dates ranging from November 16, 2023 – May 15, 2053 and $3,237,808 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.50%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $27,008,920. |
(d) | Represents less than 0.05% of net assets. |
See Accompanying Notes to the Financial Statements.
| | | | |
358 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Index Fund (cont.)
(e) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $2,149,574. |
Percentages shown are based on Net Assets.
Abbreviations
NVDR – Non-Voting Depositary Receipt
OYJ – Public Limited Company
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA – Limited partnership with share capital
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 51,541,851 | |
Aggregate gross unrealized depreciation | | | (78,682,152 | ) |
Net unrealized depreciation | | $ | (27,140,301 | ) |
Federal income tax cost | | $ | 518,827,773 | |
Futures Contracts
FlexShares® International Quality Dividend Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
MSCI EAFE E-Mini Index | | | 63 | | | | 12/15/2023 | | | | USD | | | $ | 6,218,415 | | | $ | (320,258 | ) |
MSCI Emerging Markets E-Mini Index | | | 64 | | | | 12/15/2023 | | | | USD | | | | 2,941,440 | | | | (184,913 | ) |
| | | | | | | | | | | | | | | | | | $ | (505,171 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Forward Foreign Currency Contracts
FlexShares® International Quality Dividend Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 870,416 | | | | | Bank of Montreal | | AUD | | | 1,352,000 | | | | 12/20/2023 | | | $ | 12,982 | |
USD | | | 534,437 | | | | | JPMorgan Chase Bank NA | | BRL* | | | 2,653,155 | | | | 12/20/2023 | | | | 11,310 | |
USD | | | 562,075 | | | | | Toronto-Dominion Bank (The) | | CAD | | | 757,000 | | | | 12/20/2023 | | | | 16,317 | |
USD | | | 616,884 | | | | | Morgan Stanley | | CHF | | | 552,000 | | | | 12/20/2023 | | | | 6,894 | |
USD | | | 831,793 | | | | | Toronto-Dominion Bank (The) | | CHF | | | 739,000 | | | | 12/20/2023 | | | | 15,159 | |
USD | | | 2,046,686 | | | | | BNP Paribas SA | | EUR | | | 1,912,000 | | | | 12/20/2023 | | | | 21,044 | |
USD | | | 776,396 | | | | | Toronto-Dominion Bank (The) | | EUR | | | 725,000 | | | | 12/20/2023 | | | | 8,305 | |
USD | | | 1,075,030 | | | | | JPMorgan Chase Bank NA | | GBP | | | 874,000 | | | | 12/20/2023 | | | | 14,059 | |
USD | | | 642,057 | | | | | UBS AG | | HKD | | | 5,013,000 | | | | 12/20/2023 | | | | 863 | |
USD | | | 935,242 | | | | | Citibank NA | | JPY | | | 137,972,000 | | | | 12/20/2023 | | | | 16,540 | |
USD | | | 1,481,538 | | | | | Morgan Stanley | | JPY | | | 215,437,000 | | | | 12/20/2023 | | | | 47,027 | |
USD | | | 986,505 | | | | | Toronto-Dominion Bank (The) | | JPY | | | 143,755,000 | | | | 12/20/2023 | | | | 29,296 | |
USD | | | 359,390 | | | | | Citibank NA | | KRW* | | | 474,657,039 | | | | 12/20/2023 | | | | 6,954 | |
USD | | | 137,498 | | | | | Morgan Stanley | | MXN | | | 2,396,034 | | | | 12/20/2023 | | | | 5,845 | |
Total unrealized appreciation | | | $ | 212,595 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 359 | |
FlexShares® International Quality Dividend Index Fund (cont.)
Forward Foreign Currency Contracts (cont.)
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
AUD | | | 609,004 | | | | | Citibank NA | | USD | | | 394,502 | | | | 12/20/2023 | | | $ | (8,274 | ) |
CAD | | | 1,191,313 | | | | | Citibank NA | | USD | | | 880,450 | | | | 12/20/2023 | | | | (21,574 | ) |
CHF | | | 806,636 | | | | | UBS AG | | USD | | | 911,586 | | | | 12/20/2023 | | | | (20,210 | ) |
DKK | | | 633,221 | | | | | UBS AG | | USD | | | 91,182 | | | | 12/20/2023 | | | | (1,259 | ) |
EUR | | | 791,188 | | | | | Toronto-Dominion Bank (The) | | USD | | | 847,889 | | | | 12/20/2023 | | | | (9,676 | ) |
GBP | | | 323,045 | | | | | Toronto-Dominion Bank (The) | | USD | | | 402,255 | | | | 12/20/2023 | | | | (10,102 | ) |
HKD | | | 3,104,392 | | | | | BNP Paribas SA | | USD | | | 397,321 | | | | 12/20/2023 | | | | (251 | ) |
JPY | | | 274,264,285 | | | | | Toronto-Dominion Bank (The) | | USD | | | 1,886,384 | | | | 12/20/2023 | | | | (60,165 | ) |
SEK | | | 2,423,745 | | | | | Citibank NA | | USD | | | 218,196 | | | | 12/20/2023 | | | | (729 | ) |
USD | | | 475,957 | | | | | Toronto-Dominion Bank (The) | | CHF | | | 432,000 | | | | 12/20/2023 | | | | (1,426 | ) |
USD | | | 143,556 | | | | | BNP Paribas SA | | ZAR | | | 2,739,232 | | | | 12/20/2023 | | | | (1,939 | ) |
Total unrealized depreciation | | | $ | (135,605 | ) |
Net unrealized appreciation | | | $ | 76,990 | |
* | Non-deliverable forward. See Note 2 in the Notes to Financial Statements. |
Abbreviations:
AUD – Australian Dollar
BRL – Brazilian Real
CAD – Canadian Dollar
CHF – Swiss Franc
DKK – Danish Krone
EUR – Euro
GBP – British Pound
HKD – Hong Kong Dollar
JPY – Japanese Yen
KRW – Korean Won
MXN – Mexican Peso
SEK – Swedish Krona
USD – US Dollar
ZAR – South African Rand
See Accompanying Notes to the Financial Statements.
| | | | |
360 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Index Fund (cont.)
FlexShares® International Quality Dividend Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 5.5 | % |
Belgium | | | 0.7 | |
Brazil | | | 2.0 | |
Canada | | | 5.3 | |
China | | | 8.9 | |
Denmark | | | 4.0 | |
Finland | | | 1.3 | |
France | | | 4.8 | |
Germany | | | 2.1 | |
Greece | | | 0.8 | |
Hong Kong | | | 2.3 | |
India | | | 4.2 | |
Indonesia | | | 1.0 | |
Italy | | | 1.3 | |
Japan | | | 12.0 | |
Mexico | | | 1.9 | |
Netherlands | | | 2.6 | |
New Zealand | | | 0.0 | † |
Norway | | | 2.4 | |
Qatar | | | 0.3 | |
Saudi Arabia | | | 0.3 | |
Singapore | | | 0.6 | |
South Africa | | | 1.7 | |
South Korea | | | 2.0 | |
Spain | | | 1.6 | |
Sweden | | | 3.1 | |
Switzerland | | | 9.0 | |
Taiwan | | | 6.0 | |
Thailand | | | 0.3 | |
Turkey | | | 0.4 | |
United Arab Emirates | | | 1.1 | |
United Kingdom | | | 8.7 | |
Other1 | | | 1.8 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.2 | % |
Securities Lending Reinvestments | | | 0.4 | |
Others(1) | | | 1.4 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 361 | |
Schedule of Investments
FlexShares® International Quality Dividend Defensive Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 95.6% | |
|
Aerospace & Defense – 0.8% | |
| | |
Thales SA | | | 1,498 | | | $ | 220,328 | |
|
Air Freight & Logistics – 0.4% | |
| | |
Deutsche Post AG | | | 1,218 | | | | 47,326 | |
| | |
SG Holdings Co. Ltd. | | | 3,200 | | | | 45,049 | |
| | | | | | | 92,375 | |
|
Automobile Components – 1.2% | |
| | |
Bridgestone Corp. | | | 2,000 | | | | 74,839 | |
| | |
Fuyao Glass Industry Group Co. Ltd., Class H(a) | | | 44,800 | | | | 204,115 | |
| | |
Sona Blw Precision Forgings Ltd.(a) | | | 7,812 | | | | 50,808 | |
| | | | | | | 329,762 | |
|
Automobiles – 2.0% | |
| | |
Bayerische Motoren Werke AG | | | 210 | | | | 19,451 | |
| | |
Bayerische Motoren Werke AG (Preference) | | | 56 | | | | 4,744 | |
| | |
Hero MotoCorp Ltd. | | | 5,348 | | | | 198,376 | |
| | |
Subaru Corp. | | | 11,600 | | | | 196,046 | |
| | |
Yadea Group Holdings Ltd.(a) | | | 64,000 | | | | 116,965 | |
| | | | | | | 535,582 | |
|
Banks – 10.7% | |
| | |
Arab National Bank | | | 8,204 | | | | 51,958 | |
| | |
Banco de Chile | | | 568,260 | | | | 58,193 | |
| | |
Bank Leumi Le-Israel BM | | | 17,752 | | | | 114,045 | |
| | |
Bank of China Ltd., Class H | | | 238,000 | | | | 83,342 | |
| | |
Bank of Communications Co. Ltd., Class H | | | 84,000 | | | | 49,705 | |
| | |
Bankinter SA(b) | | | 8,596 | | | | 54,171 | |
| | |
Barclays plc | | | 114,716 | | | | 183,190 | |
| | |
BOC Hong Kong Holdings Ltd. | | | 21,000 | | | | 55,556 | |
| | |
Commonwealth Bank of Australia | | | 4,914 | | | | 300,427 | |
| | |
Credicorp Ltd. | | | 420 | | | | 52,483 | |
| | |
Credit Agricole SA | | | 4,508 | | | | 54,216 | |
| | |
Hang Seng Bank Ltd. | | | 1,400 | | | | 16,040 | |
| | |
HSBC Holdings plc | | | 5,376 | | | | 38,639 | |
| | |
Japan Post Bank Co. Ltd. | | | 22,400 | | | | 206,998 | |
| | |
KBC Group NV | | | 2,016 | | | | 110,594 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
National Bank of Canada | | | 1,064 | | | $ | 66,082 | |
| | |
Nordea Bank Abp | | | 9,338 | | | | 98,038 | |
| | |
Royal Bank of Canada | | | 5,166 | | | | 412,164 | |
| | |
Sberbank of Russia PJSC‡ | | | 79,800 | | | | — | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | 7,400 | | | | 352,788 | |
| | |
Swedbank AB, Class A | | | 11,326 | | | | 185,258 | |
| | |
Toronto-Dominion Bank (The) | | | 98 | | | | 5,468 | |
| | |
Turkiye Is Bankasi A/S, Class C | | | 103,600 | | | | 76,823 | |
| | |
Yapi ve Kredi Bankasi A/S | | | 348,334 | | | | 212,255 | |
| | | | | | | 2,838,433 | |
|
Broadline Retail – 0.6% | |
| | |
B&M European Value Retail SA | | | 10,598 | | | | 68,005 | |
| | |
Dollarama, Inc.(b) | | | 1,204 | | | | 82,131 | |
| | | | | | | 150,136 | |
|
Building Products – 0.2% | |
| | |
Xinyi Glass Holdings Ltd. | | | 43,886 | | | | 50,422 | |
|
Capital Markets – 2.4% | |
| | |
Deutsche Boerse AG | | | 812 | | | | 133,206 | |
| | |
Macquarie Korea Infrastructure Fund | | | 21,345 | | | | 189,972 | |
| | |
Moscow Exchange MICEX-RTS PJSC‡ | | | 227,100 | | | | — | |
| | |
NH Investment & Securities Co. Ltd. | | | 6,216 | | | | 44,553 | |
| | |
Samsung Securities Co. Ltd. | | | 5,278 | | | | 137,954 | |
| | |
Singapore Exchange Ltd. | | | 19,600 | | | | 135,478 | |
| | | | | | | 641,163 | |
|
Chemicals – 1.8% | |
| | |
Croda International plc | | | 658 | | | | 34,956 | |
| | |
Evonik Industries AG | | | 1,386 | | | | 25,432 | |
| | |
Fertiglobe plc | | | 200,676 | | | | 175,380 | |
| | |
Nutrien Ltd. | | | 1,876 | | | | 100,648 | |
| | |
Wacker Chemie AG | | | 56 | | | | 6,837 | |
| | |
Yara International ASA | | | 4,424 | | | | 144,540 | |
| | | | | | | 487,793 | |
|
Commercial Services & Supplies – 0.9% | |
| | |
Brambles Ltd. | | | 3,724 | | | | 30,911 | |
See Accompanying Notes to the Financial Statements.
| | | | |
362 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Commercial Services & Supplies – (continued) | |
| | |
RB Global, Inc. | | | 826 | | | $ | 53,996 | |
| | |
Secom Co. Ltd. | | | 2,300 | | | | 158,705 | |
| | | | | | | 243,612 | |
|
Communications Equipment – 0.8% | |
| | |
Accton Technology Corp. | | | 14,000 | | | | 215,169 | |
|
Construction & Engineering – 0.5% | |
| | |
Taisei Corp. | | | 1,700 | | | | 57,237 | |
| | |
WSP Global, Inc. | | | 504 | | | | 65,890 | |
| | | | | | | 123,127 | |
|
Consumer Staples Distribution & Retail – 0.4% | |
| | |
Kesko OYJ, Class B | | | 588 | | | | 9,923 | |
| | |
Loblaw Cos. Ltd. | | | 770 | | | | 62,909 | |
| | |
Metro, Inc., Class A | | | 560 | | | | 28,414 | |
| | | | | | | 101,246 | |
|
Containers & Packaging – 0.2% | |
| | |
Smurfit Kappa Group plc | | | 1,638 | | | | 53,348 | |
|
Diversified Telecommunication Services – 2.5% | |
| | |
BT Group plc(b) | | | 33,712 | | | | 46,124 | |
| | |
Elisa OYJ | | | 3,668 | | | | 155,393 | |
| | |
Hellenic Telecommunications Organization SA(b) | | | 5,992 | | | | 83,793 | |
| | |
Koninklijke KPN NV | | | 59,150 | | | | 198,506 | |
| | |
Nippon Telegraph & Telephone Corp. | | | 80,200 | | | | 93,627 | |
| | |
Spark New Zealand Ltd. | | | 3,780 | | | | 10,927 | |
| | |
Telefonica Deutschland Holding AG | | | 15,218 | | | | 25,793 | |
| | |
Telenor ASA | | | 5,488 | | | | 56,075 | |
| | | | | | | 670,238 | |
|
Electric Utilities – 2.9% | |
| | |
CPFL Energia SA | | | 15,400 | | | | 102,117 | |
| | |
EDP – Energias de Portugal SA | | | 12,474 | | | | 52,344 | |
| | |
Enel SpA | | | 23,688 | | | | 149,929 | |
| | |
Fortum OYJ | | | 4,200 | | | | 49,721 | |
| | |
Hydro One Ltd.(a)(b) | | | 2,170 | | | | 56,210 | |
| | |
Iberdrola SA | | | 4,740 | | | | 52,607 | |
| | |
Power Grid Corp. of India Ltd. | | | 72,613 | | | | 176,302 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Electric Utilities – (continued) | |
| | |
Redeia Corp. SA | | | 3,234 | | | $ | 50,267 | |
| | |
SSE plc | | | 3,836 | | | | 76,013 | |
| | | | | | | 765,510 | |
|
Electrical Equipment – 0.8% | |
| | |
CG Power & Industrial Solutions Ltd. | | | 39,312 | | | | 184,192 | |
| | |
Mitsubishi Electric Corp. | | | 1,900 | | | | 21,046 | |
| | | | | | | 205,238 | |
|
Electronic Equipment, Instruments & Components – 0.7% | |
| | |
Largan Precision Co. Ltd. | | | 3,000 | | | | 191,460 | |
|
Entertainment – 0.8% | |
| | |
Capcom Co. Ltd. | | | 600 | | | | 19,171 | |
| | |
Nexon Co. Ltd. | | | 10,700 | | | | 193,977 | |
| | | | | | | 213,148 | |
|
Financial Services – 1.6% | |
| | |
Power Finance Corp. Ltd. | | | 62,282 | | | | 184,470 | |
| | |
REC Ltd. | | | 69,440 | | | | 239,866 | |
| | | | | | | 424,336 | |
|
Food Products – 3.5% | |
| | |
JBS SA | | | 15,400 | | | | 61,166 | |
| | |
Nestle SA (Registered) | | | 8,036 | | | | 865,898 | |
| | | | | | | 927,064 | |
|
Gas Utilities – 1.9% | |
| | |
Adani Total Gas Ltd. | | | 6,090 | | | | 41,276 | |
| | |
Naturgy Energy Group SA(b) | | | 7,084 | | | | 199,924 | |
| | |
Petronas Gas Bhd. | | | 53,200 | | | | 192,054 | |
| | |
Snam SpA | | | 13,790 | | | | 63,114 | |
| | | | | | | 496,368 | |
|
Ground Transportation – 0.5% | |
| | |
Canadian National Railway Co.(b) | | | 1,190 | | | | 125,776 | |
|
Health Care Equipment & Supplies – 0.7% | |
| | |
Cochlear Ltd. | | | 1,232 | | | | 187,865 | |
|
Hotels, Restaurants & Leisure – 1.7% | |
| | |
Genting Singapore Ltd. | | | 57,400 | | | | 36,031 | |
| | |
OPAP SA | | | 11,885 | | | | 200,999 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 363 | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
Sodexo SA | | | 1,960 | | | $ | 206,923 | |
| | | | | | | 443,953 | |
|
Household Durables – 0.5% | |
| | |
Sekisui Chemical Co. Ltd. | | | 4,200 | | | | 56,963 | |
| | |
Sekisui House Ltd. | | | 3,200 | | | | 62,101 | |
| | | | | | | 119,064 | |
|
Industrial Conglomerates – 0.5% | |
| | |
Alfa SAB de CV, Class A | | | 43,400 | | | | 27,021 | |
| | |
Jardine Matheson Holdings Ltd. | | | 1,100 | | | | 44,495 | |
| | |
Quinenco SA | | | 16,632 | | | | 44,871 | |
| | |
Siemens AG (Registered) | | | 70 | | | | 9,246 | |
| | | | | | | 125,633 | |
|
Industrial REITs – 0.7% | |
| | |
Goodman Group, REIT(b) | | | 15,092 | | | | 198,181 | |
|
Insurance – 4.2% | |
| | |
Admiral Group plc | | | 6,874 | | | | 203,777 | |
| | |
Allianz SE (Registered) | | | 910 | | | | 212,477 | |
| | |
BB Seguridade Participacoes SA | | | 32,200 | | | | 196,405 | |
| | |
Medibank Pvt Ltd. | | | 25,032 | | | | 54,362 | |
| | |
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | | | 406 | | | | 162,430 | |
| | |
Sampo OYJ, Class A | | | 1,946 | | | | 76,333 | |
| | |
Zurich Insurance Group AG | | | 448 | | | | 211,976 | |
| | | | | | | 1,117,760 | |
|
Interactive Media & Services – 0.5% | |
| | |
Tencent Holdings Ltd. | | | 3,900 | | | | 144,145 | |
|
IT Services – 2.3% | |
| | |
Arabian Internet & Communications Services Co. | | | 658 | | | | 54,863 | |
| | |
Capgemini SE | | | 42 | | | | 7,392 | |
| | |
Elm Co. | | | 322 | | | | 60,184 | |
| | |
HCL Technologies Ltd. | | | 15,050 | | | | 230,652 | |
| | |
SCSK Corp. | | | 700 | | | | 11,872 | |
| | |
Tata Consultancy Services Ltd. | | | 5,740 | | | | 232,247 | |
| | | | | | | 597,210 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Leisure Products – 0.8% | |
| | |
Shimano, Inc. | | | 1,400 | | | $ | 199,260 | |
|
Machinery – 0.5% | |
| | |
Kone OYJ, Class B | | | 3,080 | | | | 133,120 | |
|
Marine Transportation – 3.1% | |
| | |
AP Moller – Maersk A/S, Class A(b) | | | 42 | | | | 68,400 | |
| | |
Cia Sud Americana de Vapores SA | | | 1,402,660 | | | | 77,639 | |
| | |
COSCO SHIPPING Holdings Co. Ltd., Class H | | | 175,000 | | | | 177,805 | |
| | |
Evergreen Marine Corp. Taiwan Ltd. | | | 56,574 | | | | 187,504 | |
| | |
HMM Co. Ltd. | | | 10,724 | | | | 115,693 | |
| | |
Yang Ming Marine Transport Corp. | | | 146,884 | | | | 190,653 | |
| | | | | | | 817,694 | |
|
Metals & Mining – 6.4% | |
| | |
BHP Group Ltd. | | | 29,092 | | | | 819,672 | |
| | |
China Hongqiao Group Ltd.(b) | | | 56,000 | | | | 52,389 | |
| | |
Fortescue Metals Group Ltd.(b) | | | 4,956 | | | | 69,975 | |
| | |
Jindal Steel & Power Ltd. | | | 7,812 | | | | 59,468 | |
| | |
Kumba Iron Ore Ltd. | | | 4,116 | | | | 108,421 | |
| | |
Magnitogorsk Iron & Steel Works PJSC*‡ | | | 172,884 | | | | — | |
| | |
Novolipetsk Steel PJSC*‡ | | | 47,108 | | | | — | |
| | |
Rio Tinto Ltd. | | | 112 | | | | 8,338 | |
| | |
Rio Tinto plc | | | 6,524 | | | | 416,015 | |
| | |
Severstal PAO*‡ | | | 6,900 | | | | — | |
| | |
Vedanta Ltd. | | | 65,366 | | | | 170,051 | |
| | | | | | | 1,704,329 | |
|
Multi-Utilities – 0.1% | |
| | |
Canadian Utilities Ltd., Class A | | | 238 | | | | 5,030 | |
| | |
Engie SA | | | 2,100 | | | | 33,304 | |
| | | | | | | 38,334 | |
|
Oil, Gas & Consumable Fuels – 8.0% | |
| | |
Adaro Energy Indonesia Tbk. PT | | | 1,160,600 | | | | 187,040 | |
| | |
BP plc | | | 32,200 | | | | 196,381 | |
| | |
Cenovus Energy, Inc.(b) | | | 4,676 | | | | 88,990 | |
| | |
Equinor ASA | | | 7,518 | | | | 251,986 | |
| | |
Exxaro Resources Ltd. | | | 2,002 | | | | 19,966 | |
See Accompanying Notes to the Financial Statements.
| | | | |
364 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
LUKOIL PJSC‡ | | | 240 | | | $ | — | |
| | |
Pembina Pipeline Corp. | | | 1,750 | | | | 53,802 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 37,800 | | | | 260,395 | |
| | |
Shell plc | | | 3,794 | | | | 121,840 | |
| | |
Suncor Energy, Inc. | | | 6,874 | | | | 222,374 | |
| | |
Surgutneftegas PJSC (Preference)‡ | | | 276,000 | | | | — | |
| | |
TotalEnergies SE | | | 3,864 | | | | 258,125 | |
| | |
Turkiye Petrol Rafinerileri A/S | | | 38,570 | | | | 193,445 | |
| | |
United Tractors Tbk. PT | | | 61,400 | | | | 97,115 | |
| | |
Yankuang Energy Group Co. Ltd., Class H(b) | | | 89,999 | | | | 156,428 | |
| | | | | | | 2,107,887 | |
|
Paper & Forest Products – 0.2% | |
| | |
Stora Enso OYJ, Class R | | | 5,180 | | | | 62,007 | |
|
Personal Care Products – 1.8% | |
| | |
L’Oreal SA | | | 1,092 | | | | 457,254 | |
| | |
Unilever plc | | | 504 | | | | 23,784 | |
| | | | | | | 481,038 | |
|
Pharmaceuticals – 8.8% | |
| | |
Astellas Pharma, Inc. | | | 14,800 | | | | 185,678 | |
| | |
AstraZeneca plc | | | 784 | | | | 97,513 | |
| | |
China Medical System Holdings Ltd. | | | 126,000 | | | | 201,288 | |
| | |
GSK plc | | | 23,352 | | | | 412,976 | |
| | |
Novartis AG (Registered) | | | 3,682 | | | | 342,043 | |
| | |
Novo Nordisk A/S, Class B | | | 2,296 | | | | 220,127 | |
| | |
Orion OYJ, Class B | | | 182 | | | | 7,222 | |
| | |
Roche Holding AG | | | 28 | | | | 7,606 | |
| | |
Roche Holding AG – BR | | | 3,122 | | | | 802,241 | |
| | |
Sanofi SA | | | 532 | | | | 48,191 | |
| | | | | | | 2,324,885 | |
|
Professional Services – 1.1% | |
| | |
Bureau Veritas SA | | | 7,518 | | | | 170,771 | |
| | |
Computershare Ltd. | | | 2,422 | | | | 38,015 | |
| | |
Randstad NV | | | 574 | | | | 29,632 | |
| | |
RELX plc | | | 378 | | | | 13,155 | |
| | |
Teleperformance SE | | | 238 | | | | 27,207 | |
| | | | | | | 278,780 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Real Estate Management & Development – 1.8% | |
| | |
CapitaLand Investment Ltd. | | | 26,600 | | | $ | 57,081 | |
| | |
CK Asset Holdings Ltd. | | | 37,000 | | | | 184,891 | |
| | |
Daito Trust Construction Co. Ltd. | | | 1,800 | | | | 191,951 | |
| | |
Land & Houses PCL, NVDR | | | 245,000 | | | | 51,464 | |
| | | | | | | 485,387 | |
|
Semiconductors & Semiconductor Equipment – 2.8% | |
| | |
ASML Holding NV | | | 266 | | | | 158,941 | |
| | |
Novatek Microelectronics Corp. | | | 8,000 | | | | 112,101 | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 21,000 | | | | 342,500 | |
| | |
Vanguard International Semiconductor Corp. | | | 61,824 | | | | 133,617 | |
| | | | | | | 747,159 | |
|
Software – 0.1% | |
| | |
SAP SE | | | 238 | | | | 31,883 | |
|
Specialty Retail – 2.1% | |
| | |
Abu Dhabi National Oil Co. for Distribution PJSC | | | 38,276 | | | | 35,014 | |
| | |
Industria de Diseno Textil SA(b) | | | 6,734 | | | | 231,686 | |
| | |
Jarir Marketing Co. | | | 42,770 | | | | 165,079 | |
| | |
Topsports International Holdings Ltd.(a) | | | 14,000 | | | | 11,773 | |
| | |
Zhongsheng Group Holdings Ltd. | | | 21,000 | | | | 48,416 | |
| | |
ZOZO, Inc.(b) | | | 3,400 | | | | 64,130 | |
| | | | | | | 556,098 | |
|
Technology Hardware, Storage & Peripherals – 2.0% | |
| | |
Catcher Technology Co. Ltd. | | | 26,000 | | | | 145,491 | |
| | |
Inventec Corp. | | | 88,000 | | | | 109,067 | |
| | |
Lite-On Technology Corp. | | | 28,000 | | | | 86,326 | |
| | |
Ricoh Co. Ltd.(b) | | | 6,600 | | | | 52,841 | |
| | |
Samsung Electronics Co. Ltd. | | | 2,842 | | | | 140,780 | |
| | | | | | | 534,505 | |
|
Textiles, Apparel & Luxury Goods – 0.7% | |
| | |
Kering SA | | | 84 | | | | 34,024 | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 168 | | | | 119,775 | |
| | |
Pandora A/S | | | 322 | | | | 36,398 | |
| | | | | | | 190,197 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 365 | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Tobacco – 1.6% | |
| | |
Imperial Brands plc | | | 9,142 | | | $ | 194,245 | |
| | |
Japan Tobacco, Inc. | | | 10,400 | | | | 241,793 | |
| | | | | | | 436,038 | |
|
Trading Companies & Distributors – 2.0% | |
| | |
Ferguson plc | | | 588 | | | | 87,976 | |
| | |
ITOCHU Corp.(b) | | | 4,900 | | | | 173,843 | |
| | |
Mitsubishi Corp. | | | 3,900 | | | | 179,105 | |
| | |
Sumitomo Corp. | | | 4,200 | | | | 81,493 | |
| | | | | | | 522,417 | |
|
Wireless Telecommunication Services – 2.5% | |
| | |
Intouch Holdings PCL, NVDR | | | 95,200 | | | | 188,056 | |
| | |
KDDI Corp. | | | 5,600 | | | | 165,916 | |
| | |
SoftBank Corp. | | | 7,100 | | | | 79,933 | |
| | |
Tele2 AB, Class B | | | 21,364 | | | | 151,329 | |
| | |
Vodafone Group plc | | | 76,916 | | | | 70,654 | |
| | | | | | | 655,888 | |
TOTAL COMMON STOCKS (COST $26,583,706) | | | | 25,342,351 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 0.5%(c) | |
|
REPURCHASE AGREEMENTS – 0.5% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $125,910, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $127,323 (Cost $125,891) | | $ | 125,891 | | | | 125,891 | |
Total Investments – 96.1% (Cost $26,709,597) | | | | 25,468,242 | |
| |
Other assets less liabilities – 3.9% | | | | 1,035,130 | |
NET ASSETS – 100.0% | | | $ | 26,503,372 | |
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(b) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $1,119,564, collateralized in the form of cash with a value of $125,891 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $834,620 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 16, 2023 – August 15, 2053 and $288,411 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.50%, and maturity dates ranging from November 13, 2023 – October 22, 2071; a total value of $1,248,922. |
(c) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $125,891. |
Percentages shown are based on Net Assets.
Abbreviations
NVDR – Non-Voting Depositary Receipt
OYJ – Public Limited Company
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 2,192,922 | |
Aggregate gross unrealized depreciation | | | (3,839,821 | ) |
Net unrealized depreciation | | $ | (1,646,899 | ) |
Federal income tax cost | | $ | 27,040,655 | |
See Accompanying Notes to the Financial Statements.
| | | | |
366 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
Futures Contracts
FlexShares® International Quality Dividend Defensive Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | | | | | | | | | | | | | | | | |
MSCI EAFE E-Mini Index | | | 8 | | | | 12/15/2023 | | | | USD | | | $ | 789,640 | | | $ | (52,602 | ) |
MSCI Emerging Markets E-Mini Index | | | 7 | | | | 12/15/2023 | | | | USD | | | | 321,720 | | | | (21,884 | ) |
| | | | | | | | | | | | | | | | | | $ | (74,486 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 367 | |
FlexShares® International Quality Dividend Defensive Index Fund (cont.)
FlexShares® International Quality Dividend Defensive Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 6.4 | % |
Belgium | | | 0.4 | |
Brazil | | | 2.3 | |
Canada | | | 5.4 | |
Chile | | | 0.7 | |
China | | | 4.7 | |
Denmark | | | 1.2 | |
Finland | | | 1.9 | |
France | | | 6.2 | |
Germany | | | 2.6 | |
Greece | | | 1.1 | |
Hong Kong | | | 1.2 | |
India | | | 6.7 | |
Indonesia | | | 1.1 | |
Israel | | | 0.4 | |
Italy | | | 0.8 | |
Japan | | | 11.9 | |
Malaysia | | | 0.7 | |
Mexico | | | 0.1 | |
Netherlands | | | 1.5 | |
New Zealand | | | 0.0 | † |
Norway | | | 1.7 | |
Peru | | | 0.2 | |
Portugal | | | 0.2 | |
Saudi Arabia | | | 1.3 | |
Singapore | | | 1.0 | |
South Africa | | | 0.5 | |
South Korea | | | 2.4 | |
Spain | | | 2.2 | |
Sweden | | | 1.6 | |
Switzerland | | | 8.4 | |
Taiwan | | | 6.5 | |
Thailand | | | 0.9 | |
Turkey | | | 1.8 | |
United Arab Emirates | | | 0.8 | |
United Kingdom | | | 8.8 | |
Other1 | | | 4.4 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 95.6 | % |
Securities Lending Reinvestments | | | 0.5 | |
Others(1) | | | 3.9 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
368 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® International Quality Dividend Dynamic Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – 98.5% | |
|
Air Freight & Logistics – 1.2% | |
| | |
Deutsche Post AG | | | 7,290 | | | $ | 283,255 | |
| | |
DSV A/S | | | 3,186 | | | | 474,651 | |
| | | | | | | 757,906 | |
|
Automobile Components – 0.4% | |
| | |
Fuyao Glass Industry Group Co. Ltd., Class H(a) | | | 32,400 | | | | 147,619 | |
| | |
Magna International, Inc.(b) | | | 2,673 | | | | 128,312 | |
| | | | | | | 275,931 | |
|
Automobiles – 2.5% | |
| | |
Dr Ing hc F Porsche AG (Preference)(c) | | | 1,269 | | | | 110,713 | |
| | |
Ford Otomotiv Sanayi A/S | | | 4,347 | | | | 120,810 | |
| | |
Geely Automobile Holdings Ltd. | | | 235,000 | | | | 266,397 | |
| | |
Mercedes-Benz Group AG | | | 11,718 | | | | 686,552 | |
| | |
Yadea Group Holdings Ltd.(a) | | | 256,000 | | | | 467,858 | |
| | | | | | | 1,652,330 | |
|
Banks – 12.4% | |
| | |
ANZ Group Holdings Ltd. | | | 41,121 | | | | 643,344 | |
| | |
Banco Bilbao Vizcaya Argentaria SA(b) | | | 42,147 | | | | 330,646 | |
| | |
Banco del Bajio SA(a) | | | 167,400 | | | | 511,667 | |
| | |
Bank of Montreal | | | 10,125 | | | | 764,271 | |
| | |
Bank Polska Kasa Opieki SA | | | 7,506 | | | | 227,460 | |
| | |
Barclays plc | | | 323,379 | | | | 516,404 | |
| | |
BNP Paribas SA | | | 8,127 | | | | 466,364 | |
| | |
Canara Bank | | | 128,520 | | | | 593,291 | |
| | |
China Construction Bank Corp., Class H | | | 810,000 | | | | 459,627 | |
| | |
China Merchants Bank Co. Ltd., Class H | | | 108,000 | | | | 411,318 | |
| | |
FinecoBank Banca Fineco SpA | | | 37,854 | | | | 444,730 | |
| | |
Industrial & Commercial Bank of China Ltd., Class H | | | 1,107,000 | | | | 531,953 | |
| | |
KBC Group NV | | | 8,208 | | | | 450,277 | |
| | |
Nordea Bank Abp | | | 23,733 | | | | 249,169 | |
| | |
Royal Bank of Canada | | | 11,475 | | | | 915,520 | |
| | |
Sberbank of Russia PJSC (Preference)‡ | | | 31,920 | | | | — | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Banks – (continued) | |
| | |
Skandinaviska Enskilda Banken AB, Class A | | | 46,629 | | | $ | 518,766 | |
| | |
Standard Bank Group Ltd. | | | 12,609 | | | | 123,010 | |
| | | | | | | 8,157,817 | |
|
Beverages – 0.4% | |
| | |
Diageo plc | | | 6,885 | | | | 259,577 | |
|
Broadline Retail – 0.3% | |
| | |
B&M European Value Retail SA | | | 11,313 | | | | 72,592 | |
| | |
momo.com, Inc. | | | 8,200 | | | | 134,750 | |
| | | | | | | 207,342 | |
|
Building Products – 0.8% | |
| | |
Geberit AG (Registered) | | | 1,107 | | | | 513,085 | |
|
Capital Markets – 4.7% | |
| | |
3i Group plc | | | 24,165 | | | | 567,254 | |
| | |
Brookfield Asset Management Ltd., Class A | | | 16,227 | | | | 464,631 | |
| | |
Hong Kong Exchanges & Clearing Ltd. | | | 6,500 | | | | 228,446 | |
| | |
Julius Baer Group Ltd. | | | 8,127 | | | | 478,663 | |
| | |
Partners Group Holding AG | | | 540 | | | | 567,740 | |
| | |
Samsung Securities Co. Ltd. | | | 8,505 | | | | 222,299 | |
| | |
UBS Group AG (Registered) | | | 24,354 | | | | 567,872 | |
| | | | | | | 3,096,905 | |
|
Chemicals – 2.9% | |
| | |
BASF SE | | | 4,914 | | | | 226,125 | |
| | |
Fertiglobe plc | | | 377,595 | | | | 329,997 | |
| | |
Nissan Chemical Corp. | | | 9,500 | | | | 382,334 | |
| | |
Shin-Etsu Chemical Co. Ltd. | | | 24,300 | | | | 716,910 | |
| | |
Sika AG (Registered) | | | 432 | | | | 102,962 | |
| | |
Wacker Chemie AG | | | 945 | | | | 115,369 | |
| | |
Yara International ASA | | | 378 | | | | 12,350 | |
| | | | | | | 1,886,047 | |
|
Construction Materials – 0.1% | |
| | |
CRH plc | | | 837 | | | | 44,902 | |
|
Consumer Staples Distribution & Retail – 0.6% | |
| | |
Alimentation Couche-Tard, Inc. | | | 5,292 | | | | 287,767 | |
| | |
Jeronimo Martins SGPS SA | | | 3,807 | | | | 87,643 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 369 | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Kesko OYJ, Class B | | | 999 | | | $ | 16,858 | |
| | | | | | | 392,268 | |
|
Diversified REITs – 0.7% | |
| | |
Stockland, REIT | | | 199,125 | | | | 446,309 | |
|
Electric Utilities – 0.9% | |
| | |
Enel SpA | | | 36,180 | | | | 228,995 | |
| | |
Fortum OYJ | | | 20,898 | | | | 247,399 | |
| | |
SSE plc | | | 5,265 | | | | 104,329 | |
| | | | | | | 580,723 | |
|
Electrical Equipment – 1.1% | |
| | |
Sociedad Quimica y Minera de Chile SA (Preference), Class B | | | 8,127 | | | | 391,913 | |
| | |
Voltronic Power Technology Corp. | | | 8,000 | | | | 319,408 | |
| | | | | | | 711,321 | |
|
Electronic Equipment, Instruments & Components – 1.0% | |
| | |
Nan Ya Printed Circuit Board Corp. | | | 71,000 | | | | 516,602 | |
| | |
Unimicron Technology Corp. | | | 34,000 | | | | 149,900 | |
| | | | | | | 666,502 | |
|
Entertainment – 0.6% | |
| | |
Universal Music Group NV | | | 16,200 | | | | 395,551 | |
|
Financial Services – 3.2% | |
| | |
Banca Mediolanum SpA | | | 10,611 | | | | 86,429 | |
| | |
FirstRand Ltd. | | | 86,994 | | | | 285,109 | |
| | |
GMO Payment Gateway, Inc. | | | 8,100 | | | | 320,160 | |
| | |
Piramal Enterprises Ltd. | | | 16,956 | | | | 198,634 | |
| | |
Power Finance Corp. Ltd. | | | 200,745 | | | | 594,577 | |
| | |
REC Ltd. | | | 180,900 | | | | 624,881 | |
| | | | | | | 2,109,790 | |
|
Food Products – 1.5% | |
| | |
JBS SA | | | 37,800 | | | | 150,136 | |
| | |
Nestle SA (Registered) | | | 4,320 | | | | 465,490 | |
| | |
Uni-President China Holdings Ltd. | | | 540,000 | | | | 367,840 | |
| | | | | | | 983,466 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Gas Utilities – 0.3% | |
| | |
Kunlun Energy Co. Ltd. | | | 186,000 | | | $ | 154,988 | |
| | |
Naturgy Energy Group SA(b) | | | 2,106 | | | | 59,435 | |
| | | | | | | 214,423 | |
|
Ground Transportation – 0.1% | |
| | |
TFI International, Inc. | | | 459 | | | | 50,723 | |
|
Health Care Equipment & Supplies – 2.4% | |
| | |
Hoya Corp. | | | 5,700 | | | | 539,533 | |
| | |
Sonova Holding AG (Registered) | | | 2,052 | | | | 483,659 | |
| | |
Straumann Holding AG (Registered) | | | 3,699 | | | | 434,710 | |
| | |
Sysmex Corp. | | | 3,200 | | | | 151,141 | |
| | | | | | | 1,609,043 | |
|
Health Care Providers & Services – 0.2% | |
| | |
Amplifon SpA | | | 4,536 | | | | 127,727 | |
|
Hotels, Restaurants & Leisure – 1.2% | |
| | |
Evolution AB(a) | | | 1,593 | | | | 141,425 | |
| | |
Haidilao International Holding Ltd.(a) | | | 54,000 | | | | 134,990 | |
| | |
OPAP SA | | | 30,896 | | | | 522,513 | |
| | | | | | | 798,928 | |
|
Household Durables – 1.2% | |
| | |
Haier Smart Home Co. Ltd., Class H | | | 54,000 | | | | 154,589 | |
| | |
Nien Made Enterprise Co. Ltd. | | | 54,000 | | | | 476,152 | |
| | |
Taylor Wimpey plc | | | 109,377 | | | | 147,058 | |
| | | | | | | 777,799 | |
|
Industrial Conglomerates – 2.2% | |
| | |
Hitachi Ltd. | | | 13,500 | | | | 844,792 | |
| | |
Industries Qatar QSC | | | 144,234 | | | | 484,081 | |
| | |
Quinenco SA | | | 38,826 | | | | 104,747 | |
| | | | | | | 1,433,620 | |
|
Industrial REITs – 0.2% | |
| | |
Goodman Group, REIT(b) | | | 12,474 | | | | 163,803 | |
|
Insurance – 2.2% | |
| | |
AXA SA | | | 13,689 | | | | 404,489 | |
| | |
BB Seguridade Participacoes SA | | | 29,700 | | | | 181,156 | |
| | |
Legal & General Group plc | | | 53,028 | | | | 136,029 | |
See Accompanying Notes to the Financial Statements.
| | | | |
370 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Insurance – (continued) | |
| | |
Manulife Financial Corp. | | | 31,725 | | | $ | 551,660 | |
| | |
Powszechny Zaklad Ubezpieczen SA | | | 16,794 | | | | 189,739 | |
| | | | | | | 1,463,073 | |
|
Interactive Media & Services – 2.3% | |
| | |
Autohome, Inc., ADR | | | 3,834 | | | | 102,559 | |
| | |
REA Group Ltd.(b) | | | 5,130 | | | | 466,779 | |
| | |
Rightmove plc | | | 75,681 | | | | 434,380 | |
| | |
SEEK Ltd. | | | 1,053 | | | | 13,741 | |
| | |
Tencent Holdings Ltd. | | | 13,500 | | | | 498,965 | |
| | | | | | | 1,516,424 | |
|
IT Services – 0.2% | |
| | |
Infosys Ltd. | | | 7,371 | | | | 121,146 | |
|
Leisure Products – 0.6% | |
| | |
Shimano, Inc. | | | 3,000 | | | | 426,987 | |
|
Machinery – 1.9% | |
| | |
Atlas Copco AB, Class A | | | 20,412 | | | | 263,448 | |
| | |
Atlas Copco AB, Class B | | | 3,645 | | | | 40,797 | |
| | |
Daifuku Co. Ltd. | | | 8,100 | | | | 131,920 | |
| | |
MISUMI Group, Inc. | | | 21,600 | | | | 322,264 | |
| | |
VAT Group AG(a) | | | 1,377 | | | | 485,252 | |
| | | | | | | 1,243,681 | |
|
Marine Transportation – 3.3% | |
| | |
AP Moller – Maersk A/S, Class A(b) | | | 174 | | | | 283,373 | |
| | |
COSCO SHIPPING Holdings Co. Ltd., Class H | | | 553,500 | | | | 562,371 | |
| | |
Evergreen Marine Corp. Taiwan Ltd. | | | 162,000 | | | | 536,920 | |
| | |
Hapag-Lloyd AG(a) | | | 108 | | | | 15,537 | |
| | |
Orient Overseas International Ltd.(b) | | | 27,000 | | | | 340,407 | |
| | |
Yang Ming Marine Transport Corp. | | | 338,000 | | | | 438,717 | |
| | | | | | | 2,177,325 | |
|
Media – 0.5% | |
| | |
Publicis Groupe SA | | | 2,484 | | | | 188,307 | |
| | |
WPP plc | | | 15,903 | | | | 136,356 | |
| | | | | | | 324,663 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Metals & Mining – 6.9% | |
| | |
BHP Group Ltd. | | | 74,223 | | | $ | 2,091,246 | |
| | |
Fortescue Metals Group Ltd.(b) | | | 14,364 | | | | 202,809 | |
| | |
Gerdau SA (Preference) | | | 21,265 | | | | 91,798 | |
| | |
Kumba Iron Ore Ltd. | | | 22,707 | | | | 598,135 | |
| | |
MMC Norilsk Nickel PJSC*‡ | | | 2,128 | | | | — | |
| | |
Norsk Hydro ASA | | | 85,482 | | | | 487,257 | |
| | |
Rio Tinto plc | | | 9,396 | | | | 599,153 | |
| | |
Severstal PAO*‡ | | | 7,952 | | | | — | |
| | |
Vedanta Ltd. | | | 181,305 | | | | 471,670 | |
| | | | | | | 4,542,068 | |
|
Oil, Gas & Consumable Fuels – 8.7% | |
| | |
Adaro Energy Indonesia Tbk. PT | | | 1,309,500 | | | | 211,037 | |
| | |
Canadian Natural Resources Ltd. | | | 16,227 | | | | 1,029,317 | |
| | |
Coal India Ltd. | | | 180,360 | | | | 680,747 | |
| | |
Equinor ASA | | | 14,013 | | | | 469,684 | |
| | |
Exxaro Resources Ltd. | | | 65,448 | | | | 652,703 | |
| | |
OMV AG | | | 2,808 | | | | 122,759 | |
| | |
Ovintiv, Inc. | | | 3,537 | | | | 169,776 | |
| | |
Petroleo Brasileiro SA (Preference) | | | 94,500 | | | | 650,987 | |
| | |
Shell plc | | | 3,078 | | | | 98,847 | |
| | |
United Tractors Tbk. PT | | | 294,300 | | | | 465,489 | |
| | |
Var Energi ASA | | | 173,880 | | | | 585,686 | |
| | |
Woodside Energy Group Ltd. | | | 7,318 | | | | 158,738 | |
| | |
Yankuang Energy Group Co. Ltd., Class H(b) | | | 242,000 | | | | 420,622 | |
| | | | | | | 5,716,392 | |
|
Personal Care Products – 2.3% | |
| | |
L’Oreal SA | | | 3,537 | | | | 1,481,050 | |
|
Pharmaceuticals – 5.4% | |
| | |
Astellas Pharma, Inc. | | | 16,200 | | | | 203,242 | |
| | |
AstraZeneca plc | | | 1,053 | | | | 130,971 | |
| | |
China Medical System Holdings Ltd. | | | 366,000 | | | | 584,694 | |
| | |
Chugai Pharmaceutical Co. Ltd. | | | 6,800 | | | | 200,258 | |
| | |
CSPC Pharmaceutical Group Ltd. | | | 408,000 | | | | 356,138 | |
| | |
GSK plc | | | 27,756 | | | | 490,860 | |
| | |
Hansoh Pharmaceutical Group Co. Ltd.(a) | | | 324,000 | | | | 610,352 | |
| | |
Novartis AG (Registered) | | | 1,323 | | | | 122,901 | |
| | |
Novo Nordisk A/S, Class B | | | 7,128 | | | | 683,390 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 371 | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
| | | | | | | | |
Investments | | Shares | | | Value | |
|
COMMON STOCKS – (continued) | |
|
Pharmaceuticals – (continued) | |
| | |
Orion OYJ, Class B | | | 432 | | | $ | 17,142 | |
| | |
Roche Holding AG | | | 594 | | | | 152,637 | |
| | | | | | | 3,552,585 | |
|
Professional Services – 1.7% | |
| | |
Randstad NV | | | 9,180 | | | | 473,907 | |
| | |
Recruit Holdings Co. Ltd. | | | 21,600 | | | | 617,999 | |
| | | | | | | 1,091,906 | |
|
Real Estate Management & Development – 0.5% | |
| | |
Daiwa House Industry Co. Ltd. | | | 3,700 | | | | 100,828 | |
| | |
Land & Houses PCL, NVDR | | | 772,200 | | | | 162,207 | |
| | |
Longfor Group Holdings Ltd.(a) | | | 67,500 | | | | 98,171 | |
| | | | | | | 361,206 | |
|
Semiconductors & Semiconductor Equipment – 7.6% | |
| | |
ASM International NV | | | 81 | | | | 33,262 | |
| | |
ASML Holding NV | | | 4,509 | | | | 2,694,227 | |
| | |
Globalwafers Co. Ltd. | | | 8,000 | | | | 117,034 | |
| | |
MediaTek, Inc. | | | 12,000 | | | | 311,516 | |
| | |
Novatek Microelectronics Corp. | | | 42,000 | | | | 588,531 | |
| | |
Taiwan Semiconductor Manufacturing Co. Ltd. | | | 43,000 | | | | 701,310 | |
| | |
Tokyo Electron Ltd. | | | 4,300 | | | | 560,907 | |
| | | | | | | 5,006,787 | |
|
Software – 0.7% | |
| | |
Temenos AG (Registered) | | | 6,696 | | | | 479,289 | |
|
Specialty Retail – 2.0% | |
| | |
Fast Retailing Co. Ltd. | | | 2,700 | | | | 588,689 | |
| | |
Industria de Diseno Textil SA(b) | | | 16,875 | | | | 580,590 | |
| | |
ZOZO, Inc.(b) | | | 8,100 | | | | 152,779 | |
| | | | | | | 1,322,058 | |
|
Technology Hardware, Storage & Peripherals – 0.3% | |
| | |
Samsung Electronics Co. Ltd. | | | 3,915 | | | | 193,931 | |
|
Textiles, Apparel & Luxury Goods – 5.0% | |
| | |
Burberry Group plc | | | 19,494 | | | | 400,243 | |
| | |
Cie Financiere Richemont SA (Registered) | | | 7,668 | | | | 900,730 | |
| | |
Hermes International SCA | | | 297 | | | | 552,389 | |
| | | | | | | | |
Investments | | Shares | | | Value | |
|
Textiles, Apparel & Luxury Goods – (continued) | |
| | |
LVMH Moet Hennessy Louis Vuitton SE | | | 270 | | | $ | 192,496 | |
| | |
Moncler SpA | | | 1,296 | | | | 67,042 | |
| | |
Pandora A/S | | | 5,184 | | | | 585,988 | |
| | |
Shenzhou International Group Holdings Ltd. | | | 56,700 | | | | 556,159 | |
| | | | | | | 3,255,047 | |
|
Tobacco – 1.6% | |
| | |
Imperial Brands plc | | | 21,492 | | | | 456,651 | |
| | |
Japan Tobacco, Inc. | | | 27,000 | | | | 627,733 | |
| | | | | | | 1,084,384 | |
|
Trading Companies & Distributors – 1.6% | |
| | |
Howden Joinery Group plc | | | 57,132 | | | | 442,028 | |
| | |
ITOCHU Corp.(b) | | | 3,100 | | | | 109,982 | |
| | |
Marubeni Corp. | | | 36,000 | | | | 517,733 | |
| | | | | | | 1,069,743 | |
|
Wireless Telecommunication Services – 0.1% | |
| | |
Vodafone Group plc | | | 41,229 | | | | 37,872 | |
TOTAL COMMON STOCKS (COST $70,125,114) | | | | 64,781,455 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 1.1%(d) | |
|
REPURCHASE AGREEMENTS – 1.1% | |
| | |
Citigroup Global Markets, Inc., 5.28%, dated 10/31/2023, due 11/1/2023, repurchase price $695,982, collateralized by various U.S. Treasury Securities, ranging from 1.50% – 3.88%, maturing 2/15/2025 – 1/31/2027; total market value $703,793 (Cost $695,880) | | $ | 695,880 | | | | 695,880 | |
Total Investments – 99.6% (Cost $70,820,994) | | | | 65,477,335 | |
| |
Other assets less liabilities – 0.4% | | | | 236,373 | |
NET ASSETS – 100.0% | | | $ | 65,713,708 | |
See Accompanying Notes to the Financial Statements.
| | | | |
372 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
* | Non-income producing security. |
‡ | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(a) | Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. |
(b) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $2,403,416, collateralized in the form of cash with a value of $695,880 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $1,560,967 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.13%, and maturity dates ranging from November 16, 2023 – August 15, 2053 and $384,728 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 5.00%, and maturity dates ranging from November 13, 2023 – October 22, 2073; a total value of $2,641,575. |
(c) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(d) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $695,880. |
Percentages shown are based on Net Assets.
Abbreviations
ADR – American Depositary Receipt
NVDR – Non-Voting Depositary Receipt
OYJ – Public Limited Company
PJSC – Public Joint Stock Company
Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.
REIT – Real Estate Investment Trust
SCA– Limited partnership with share capital
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 3,655,732 | |
Aggregate gross unrealized depreciation | | | (10,203,061 | ) |
Net unrealized depreciation | | $ | (6,547,329 | ) |
Federal income tax cost | | $ | 71,965,876 | |
Futures Contracts
FlexShares® International Quality Dividend Dynamic Index Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | | | | | | | | | | | | | | | | | | | | |
MSCI EAFE E-Mini Index | | | 7 | | | | 12/15/2023 | | | | USD | | | $ | 690,935 | | | $ | (40,656 | ) |
MSCI Emerging Markets E-Mini Index | | | 8 | | | | 12/15/2023 | | | | USD | | | | 367,680 | | | | (22,089 | ) |
| | | | | | | | | | | | | | | | | | $ | (62,745 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 373 | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
Forward Foreign Currency Contracts
FlexShares® International Quality Dividend Dynamic Index Fund had the following outstanding contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | | | |
Contracts to Receive | | Counterparty | | In Exchange For | | | Maturity Date | | | Unrealized Appreciation/ (Depreciation) | |
USD | | | 222,140 | | | | | Toronto-Dominion Bank (The) | | EUR | | | 207,284 | | | | 12/20/2023 | | | $ | 2,535 | |
USD | | | 44,725 | | | | | Toronto-Dominion Bank (The) | | GBP | | | 35,918 | | | | 12/20/2023 | | | | 1,123 | |
USD | | | 57,941 | | | | | Toronto-Dominion Bank (The) | | JPY | | | 8,424,060 | | | | 12/20/2023 | | | | 1,848 | |
Total unrealized appreciation | | | | | | | $ | 5,506 | |
CAD | | | 85,542 | | | | | Citibank NA | | USD | | | 63,220 | | | | 12/20/2023 | | | $ | (1,549 | ) |
Total unrealized depreciation | | | | | | | $ | (1,549 | ) |
Net unrealized appreciation | | | | | | | $ | 3,957 | |
Abbreviations:
CAD – Canadian Dollar
EUR – Euro
GBP – British Pound
JPY – Japanese Yen
USD – US Dollar
See Accompanying Notes to the Financial Statements.
| | | | |
374 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® International Quality Dividend Dynamic Index Fund (cont.)
FlexShares® International Quality Dividend Dynamic Index invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 6.4 | % |
Austria | | | 0.2 | |
Belgium | | | 0.7 | |
Brazil | | | 1.6 | |
Canada | | | 6.6 | |
Chile | | | 0.8 | |
China | | | 11.0 | |
Denmark | | | 3.1 | |
Finland | | | 0.4 | |
France | | | 5.0 | |
Germany | | | 2.2 | |
Greece | | | 0.8 | |
Hong Kong | | | 0.3 | |
India | | | 5.0 | |
Indonesia | | | 1.0 | |
Ireland | | | 0.1 | |
Italy | | | 1.5 | |
Japan | | | 11.4 | |
Mexico | | | 0.8 | |
Netherlands | | | 5.5 | |
Norway | | | 2.4 | |
Poland | | | 0.6 | |
Portugal | | | 0.1 | |
Qatar | | | 0.7 | |
South Africa | | | 2.5 | |
South Korea | | | 0.6 | |
Spain | | | 1.5 | |
Sweden | | | 1.8 | |
Switzerland | | | 8.8 | |
Taiwan | | | 6.5 | |
Thailand | | | 0.2 | |
Turkey | | | 0.2 | |
United Arab Emirates | | | 0.5 | |
United Kingdom | | | 7.7 | |
Other1 | | | 1.5 | |
| | | 100.0 | % |
1 | Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Common Stocks | | | 98.5 | % |
Securities Lending Reinvestments | | | 1.1 | |
Others(1) | | | 0.4 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 375 | |
Schedule of Investments
FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
U.S. TREASURY OBLIGATIONS – 99.8% | |
| | |
U.S. Treasury Inflation Linked Bonds | | | | | | | | |
2.38%, 1/15/2025 | | $ | 65,116,566 | | | $ | 64,291,587 | |
2.00%, 1/15/2026 | | | 44,175,109 | | | | 43,287,005 | |
2.38%, 1/15/2027 | | | 88,826,406 | | | | 87,914,721 | |
1.75%, 1/15/2028 | | | 33,304,397 | | | | 32,189,480 | |
3.63%, 4/15/2028 | | | 46,376,634 | | | | 48,397,158 | |
2.50%, 1/15/2029 | | | 29,414,287 | | | | 29,375,509 | |
3.88%, 4/15/2029 | | | 53,535,614 | | | | 57,092,804 | |
| | |
U.S. Treasury Inflation Linked Notes | | | | | | | | |
0.25%, 1/15/2025 | | | 75,903,090 | | | | 73,077,479 | |
0.13%, 4/15/2025 | | | 60,391,232 | | | | 57,658,686 | |
0.38%, 7/15/2025 | | | 75,804,809 | | | | 72,609,754 | |
0.13%, 10/15/2025 | | | 57,971,254 | | | | 55,000,227 | |
0.63%, 1/15/2026 | | | 78,284,302 | | | | 74,467,942 | |
0.13%, 4/15/2026 | | | 66,699,399 | | | | 62,373,708 | |
0.13%, 7/15/2026(a) | | | 67,389,132 | | | | 63,016,078 | |
0.13%, 10/15/2026 | | | 152,365,313 | | | | 141,662,046 | |
0.38%, 1/15/2027 | | | 173,121,821 | | | | 160,856,208 | �� |
0.13%, 4/15/2027 | | | 151,567,555 | | | | 138,821,967 | |
0.38%, 7/15/2027 | | | 164,024,102 | | | | 151,688,656 | |
1.63%, 10/15/2027 | | | 59,691,228 | | | | 57,693,554 | |
0.50%, 1/15/2028 | | | 69,003,679 | | | | 63,322,331 | |
1.25%, 4/15/2028 | | | 58,852,331 | | | | 55,634,419 | |
0.75%, 7/15/2028 | | | 64,055,318 | | | | 59,255,548 | |
2.38%, 10/15/2028 | | | 32,161,683 | | | | 32,057,828 | |
0.88%, 1/15/2029 | | | 62,779,682 | | | | 57,802,676 | |
0.25%, 7/15/2029 | | | 68,230,485 | | | | 60,383,313 | |
0.13%, 1/15/2030 | | | 69,972,684 | | | | 60,408,839 | |
0.13%, 7/15/2030 | | | 73,364,225 | | | | 62,847,492 | |
Total U.S. Treasury Obligations (Cost $2,015,549,742) | | | | 1,923,187,015 | |
| | | | | | | | |
Total Investments – 99.8% (Cost $2,015,549,742) | | | | 1,923,187,015 | |
| |
Other assets less liabilities – 0.2% | | | | 4,736,222 | |
NET ASSETS – 100.0% | | | $ | 1,927,923,237 | |
(a) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $1,197,583, collateralized in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% — 6.00%, and maturity dates ranging from January 31, 2024 — August 15, 2053; a total value of $1,224,345. |
Percentages shown are based on Net Assets.
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | — | |
Aggregate gross unrealized depreciation | | | (108,003,462 | ) |
Net unrealized depreciation | | $ | (108,003,462 | ) |
Federal income tax cost | | $ | 2,031,190,477 | |
| | | | |
Security Type | | % of Net Assets | |
U.S. Treasury Obligations | | | 99.8 | % |
Others(1) | | | 0.2 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
376 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
| |
U.S. TREASURY OBLIGATIONS – 99.7% | | | | |
| | |
U.S. Treasury Inflation Linked Bonds | | | | | | | | |
2.38%, 1/15/2027 | | $ | 20,227,404 | | | $ | 20,019,796 | |
1.75%, 1/15/2028 | | | 18,471,666 | | | | 17,853,298 | |
3.63%, 4/15/2028 | | | 26,169,550 | | | | 27,309,698 | |
2.50%, 1/15/2029 | | | 24,758,109 | | | | 24,725,469 | |
3.88%, 4/15/2029 | | | 45,056,574 | | | | 48,050,372 | |
3.38%, 4/15/2032 | | | 7,133,365 | | | | 7,556,816 | |
2.13%, 2/15/2040 | | | 17,375,556 | | | | 16,233,023 | |
| | |
U.S. Treasury Inflation Linked Notes | | | | | | | | |
0.38%, 1/15/2027 | | | 39,443,564 | | | | 36,649,002 | |
0.13%, 4/15/2027 | | | 34,551,365 | | | | 31,645,879 | |
0.38%, 7/15/2027 | | | 37,367,433 | | | | 34,557,212 | |
1.63%, 10/15/2027 | | | 33,705,354 | | | | 32,577,344 | |
0.50%, 1/15/2028 | | | 38,966,578 | | | | 35,758,305 | |
1.25%, 4/15/2028 | | | 33,230,849 | | | | 31,413,862 | |
0.75%, 7/15/2028 | | | 36,166,731 | | | | 33,456,698 | |
2.38%, 10/15/2028 | | | 18,245,503 | | | | 18,186,585 | |
0.88%, 1/15/2029 | | | 53,781,800 | | | | 49,518,122 | |
0.25%, 7/15/2029 | | | 58,451,722 | | | | 51,729,203 | |
0.13%, 1/15/2030 | | | 59,939,082 | | | | 51,746,626 | |
0.13%, 7/15/2030 | | | 41,428,364 | | | | 35,489,624 | |
0.13%, 1/15/2031 | | | 41,219,899 | | | | 34,768,824 | |
0.13%, 7/15/2031 | | | 43,274,687 | | | | 36,217,194 | |
0.13%, 1/15/2032 | | | 45,645,999 | | | | 37,625,855 | |
0.63%, 7/15/2032 | | | 41,442,053 | | | | 35,477,068 | |
1.13%, 1/15/2033 | | | 41,402,992 | | | | 36,677,228 | |
1.38%, 7/15/2033 | | | 26,677,168 | | | | 24,131,635 | |
Total U.S. Treasury Obligations (Cost $871,004,354) | | | | 809,374,738 | |
| | | | | | | | |
Total Investments – 99.7% (Cost $871,004,354) | | | | 809,374,738 | |
| |
Other assets less liabilities – 0.3% | | | | 2,175,664 | |
NET ASSETS – 100.0% | | | $ | 811,550,402 | |
Percentages shown are based on Net Assets.
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | — | |
Aggregate gross unrealized depreciation | | | (76,349,655 | ) |
Net unrealized depreciation | | $ | (76,349,655 | ) |
Federal income tax cost | | $ | 885,724,393 | |
| | | | |
Security Type | | % of Net Assets | |
U.S. Treasury Obligations | | | 99.7 | % |
Others(1) | | | 0.3 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 377 | |
Schedule of Investments
FlexShares® Disciplined Duration MBS Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
MORTGAGE-BACKED SECURITIES – 99.1% | |
| | |
FHLMC | | | | | | | | |
2.50%, 1/1/2028 | | $ | 116,974 | | | $ | 111,268 | |
2.50%, 4/1/2028 | | | 351,349 | | | | 334,191 | |
2.50%, 7/1/2028 | | | 185,258 | | | | 175,305 | |
2.50%, 1/1/2029 | | | 25,819 | | | | 24,510 | |
2.50%, 1/1/2030 | | | 296,003 | | | | 281,517 | |
3.00%, 1/1/2032 | | | 1,057,338 | | | | 987,706 | |
2.50%, 2/1/2032 | | | 1,298,455 | | | | 1,194,728 | |
5.00%, 5/1/2034 | | | 41,400 | | | | 40,274 | |
5.00%, 7/1/2035 | | | 94,783 | | | | 92,106 | |
5.00%, 8/1/2035 | | | 77,454 | | | | 75,219 | |
5.00%, 10/1/2035 | | | 13,848 | | | | 13,413 | |
5.00%, 12/1/2035 | | | 81,027 | | | | 78,673 | |
6.00%, 1/1/2037 | | | 52,030 | | | | 52,262 | |
6.00%, 4/1/2037 | | | 27,226 | | | | 27,347 | |
6.00%, 5/1/2037 | | | 47,251 | | | | 47,461 | |
5.00%, 2/1/2038 | | | 40,611 | | | | 39,468 | |
5.00%, 7/1/2038 | | | 40,882 | | | | 39,402 | |
5.00%, 10/1/2038 | | | 37,116 | | | | 35,755 | |
5.00%, 2/1/2039 | | | 95,200 | | | | 92,394 | |
5.00%, 5/1/2039 | | | 53,202 | | | | 51,193 | |
5.00%, 6/1/2039 | | | 18,811 | | | | 18,169 | |
5.00%, 7/1/2039 | | | 40,715 | | | | 39,036 | |
5.00%, 9/1/2039 | | | 4,330 | | | | 4,171 | |
6.00%, 11/1/2039 | | | 29,276 | | | | 29,406 | |
5.00%, 1/1/2040 | | | 12,765 | | | | 12,257 | |
5.00%, 3/1/2040 | | | 34,937 | | | | 33,502 | |
5.00%, 4/1/2040 | | | 15,450 | | | | 14,816 | |
6.00%, 4/1/2040 | | | 33,193 | | | | 33,289 | |
5.00%, 5/1/2040 | | | 13,795 | | | | 13,220 | |
6.00%, 5/1/2040 | | | 80,108 | | | | 80,340 | |
5.00%, 7/1/2040 | | | 76,905 | | | | 73,559 | |
6.00%, 7/1/2040 | | | 125,719 | | | | 126,248 | |
4.00%, 1/1/2041 | | | 10,598 | | | | 9,476 | |
5.00%, 5/1/2041 | | | 108,741 | | | | 104,302 | |
3.50%, 11/1/2041 | | | 55,001 | | | | 48,370 | |
3.00%, 3/1/2042 | | | 9,320 | | | | 7,880 | |
3.00%, 4/1/2042 | | | 70,612 | | | | 59,680 | |
3.00%, 6/1/2042 | | | 58,975 | | | | 49,832 | |
3.50%, 7/1/2042 | | | 570,746 | | | | 501,942 | |
3.00%, 8/1/2042 | | | 33,492 | | | | 28,300 | |
3.00%, 12/1/2042 | | | 72,672 | | | | 61,378 | |
3.00%, 1/1/2043 | | | 37,510 | | | | 31,643 | |
3.00%, 2/1/2043 | | | 19,654 | | | | 16,683 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
3.00%, 4/1/2043 | | $ | 24,492 | | | $ | 20,631 | |
3.00%, 6/1/2043 | | | 15,182 | | | | 12,814 | |
3.50%, 8/1/2043 | | | 637,674 | | | | 555,213 | |
3.00%, 10/1/2043 | | | 47,967 | | | | 40,406 | |
4.00%, 8/1/2044 | | | 10,728 | | | | 9,413 | |
5.00%, 8/1/2044 | | | 30,302 | | | | 29,284 | |
4.00%, 1/1/2045 | | | 32,604 | | | | 28,934 | |
4.00%, 2/1/2045 | | | 72,152 | | | | 64,088 | |
4.50%, 2/1/2045 | | | 358,793 | | | | 327,172 | |
4.00%, 8/1/2045 | | | 80,908 | | | | 71,953 | |
4.00%, 9/1/2045 | | | 13,610 | | | | 12,064 | |
4.00%, 10/1/2045 | | | 135,936 | | | | 120,404 | |
4.00%, 11/1/2045 | | | 28,001 | | | | 24,890 | |
4.00%, 12/1/2045 | | | 11,441 | | | | 10,138 | |
4.00%, 1/1/2046 | | | 36,024 | | | | 31,959 | |
2.50%, 9/1/2046 | | | 21,545 | | | | 16,888 | |
3.00%, 11/1/2046 | | | 23,272 | | | | 19,254 | |
| | |
FHLMC UMBS | | | | | | | | |
3.00%, 8/1/2026 | | | 38,866 | | | | 37,649 | |
3.00%, 1/1/2027 | | | 63,190 | | | | 60,983 | |
3.00%, 2/1/2027 | | | 36,524 | | | | 35,198 | |
3.00%, 4/1/2027 | | | 225,151 | | | | 217,127 | |
2.50%, 6/1/2027 | | | 21,804 | | | | 20,793 | |
2.50%, 3/1/2028 | | | 766,102 | | | | 727,069 | |
3.00%, 8/1/2029 | | | 105,118 | | | | 98,880 | |
2.50%, 8/1/2030 | | | 851,807 | | | | 786,853 | |
2.50%, 11/1/2030 | | | 34,306 | | | | 32,393 | |
3.00%, 5/1/2031 | | | 62,559 | | | | 60,011 | |
2.00%, 8/1/2031 | | | 27,118 | | | | 24,327 | |
4.00%, 8/1/2031 | | | 66,741 | | | | 63,296 | |
4.00%, 9/1/2031 | | | 60,704 | | | | 57,531 | |
2.00%, 11/1/2031 | | | 43,724 | | | | 39,134 | |
2.50%, 12/1/2031 | | | 586,655 | | | | 539,647 | |
2.00%, 1/1/2032 | | | 87,554 | | | | 78,534 | |
4.00%, 1/1/2032 | | | 80,979 | | | | 76,670 | |
2.00%, 2/1/2032 | | | 94,171 | | | | 81,683 | |
3.50%, 2/1/2032 | | | 150,071 | | | | 139,641 | |
4.00%, 2/1/2032 | | | 125,056 | | | | 118,441 | |
3.50%, 3/1/2032 | | | 126,230 | | | | 117,456 | |
3.50%, 7/1/2032 | | | 97,512 | | | | 90,607 | |
2.00%, 12/1/2032 | | | 719,222 | | | | 645,113 | |
3.00%, 4/1/2033 | | | 1,322,763 | | | | 1,251,914 | |
3.50%, 5/1/2033 | | | 30,409 | | | | 28,179 | |
3.00%, 10/1/2033 | | | 1,388,085 | | | | 1,303,438 | |
2.00%, 10/1/2035 | | | 1,077,813 | | | | 924,061 | |
See Accompanying Notes to the Financial Statements.
| | | | |
378 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Disciplined Duration MBS Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
MORTGAGE-BACKED SECURITIES – (continued) | |
1.50%, 2/1/2036 | | $ | 1,147,948 | | | $ | 950,983 | |
2.00%, 3/1/2036 | | | 410,219 | | | | 351,333 | |
1.50%, 4/1/2036 | | | 304,001 | | | | 251,720 | |
4.00%, 5/1/2036 | | | 23,675 | | | | 22,453 | |
5.00%, 3/1/2038 | | | 47,274 | | | | 45,743 | |
5.00%, 7/1/2039 | | | 63,980 | | | | 61,248 | |
3.00%, 9/1/2039 | | | 100,616 | | | | 86,004 | |
3.00%, 10/1/2039 | | | 28,415 | | | | 24,265 | |
5.00%, 10/1/2039 | | | 23,524 | | | | 22,602 | |
3.00%, 11/1/2039 | | | 113,060 | | | | 96,500 | |
5.00%, 1/1/2040 | | | 24,294 | | | | 23,417 | |
5.00%, 3/1/2040 | | | 36,722 | | | | 35,206 | |
5.00%, 5/1/2040 | | | 51,010 | | | | 48,841 | |
2.00%, 7/1/2040 | | | 102,924 | | | | 81,573 | |
1.50%, 10/1/2040 | | | 535,347 | | | | 403,232 | |
3.50%, 12/1/2040 | | | 40,000 | | | | 35,125 | |
2.00%, 1/1/2041 | | | 164,501 | | | | 130,984 | |
2.00%, 2/1/2041 | | | 960,772 | | | | 761,437 | |
1.50%, 3/1/2041 | | | 696,120 | | | | 521,670 | |
2.00%, 3/1/2041 | | | 596,553 | | | | 472,782 | |
4.50%, 3/1/2041 | | | 68,990 | | | | 63,655 | |
4.50%, 4/1/2041 | | | 15,321 | | | | 14,146 | |
1.50%, 5/1/2041 | | | 574,531 | | | | 429,835 | |
2.50%, 6/1/2041 | | | 461,626 | | | | 374,071 | |
2.00%, 10/1/2041 | | | 506,265 | | | | 398,284 | |
4.00%, 1/1/2042 | | | 53,228 | | | | 47,599 | |
5.00%, 2/1/2042 | | | 43,289 | | | | 41,289 | |
3.50%, 11/1/2042 | | | 70,001 | | | | 61,035 | |
3.50%, 1/1/2043 | | | 35,854 | | | | 31,484 | |
3.50%, 2/1/2043 | | | 24,350 | | | | 21,381 | |
2.50%, 6/1/2043 | | | 371,604 | | | | 294,654 | |
4.00%, 12/1/2043 | | | 10,706 | | | | 9,499 | |
4.50%, 3/1/2044 | | | 49,981 | | | | 46,039 | |
4.00%, 6/1/2044 | | | 3,867 | | | | 3,389 | |
4.50%, 7/1/2044 | | | 18,383 | | | | 16,865 | |
4.00%, 8/1/2044 | | | 11,592 | | | | 10,156 | |
4.50%, 12/1/2044 | | | 12,424 | | | | 11,392 | |
4.00%, 2/1/2045 | | | 14,430 | | | | 12,798 | |
4.50%, 9/1/2045 | | | 14,537 | | | | 13,314 | |
4.00%, 10/1/2045 | | | 37,280 | | | | 33,068 | |
4.00%, 12/1/2045 | | | 18,726 | | | | 16,611 | |
4.50%, 12/1/2045 | | | 591,780 | | | | 542,664 | |
3.00%, 1/1/2046 | | | 39,384 | | | | 32,764 | |
4.00%, 1/1/2046 | | | 32,526 | | | | 28,835 | |
4.00%, 2/1/2046 | | | 232,167 | | | | 207,411 | |
4.50%, 4/1/2046 | | | 30,386 | | | | 27,941 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
4.00%, 11/1/2046 | | $ | 169,382 | | | $ | 148,202 | |
4.50%, 3/1/2047 | | | 431,550 | | | | 395,449 | |
4.50%, 8/1/2048 | | | 407,951 | | | | 371,520 | |
6.00%, 6/1/2053 | | | 837,919 | | | | 817,102 | |
6.50%, 10/1/2053 | | | 594,486 | | | | 591,383 | |
| | |
FNMA UMBS | | | | | | | | |
3.50%, 12/1/2025 | | | 412,385 | | | | 403,444 | |
4.00%, 5/1/2026 | | | 239,622 | | | | 233,168 | |
3.00%, 11/1/2026 | | | 560,673 | | | | 541,396 | |
3.00%, 12/1/2026 | | | 166,563 | | | | 160,806 | |
3.50%, 12/1/2026 | | | 236,864 | | | | 230,973 | |
3.00%, 1/1/2027 | | | 54,435 | | | | 52,534 | |
3.00%, 2/1/2027 | | | 64,687 | | | | 62,384 | |
3.00%, 6/1/2027 | | | 218,841 | | | | 210,478 | |
3.00%, 8/1/2027 | | | 235,889 | | | | 226,588 | |
3.00%, 10/1/2027 | | | 68,360 | | | | 65,583 | |
3.00%, 11/1/2027 | | | 82,755 | | | | 79,397 | |
2.50%, 12/1/2027 | | | 164,999 | | | | 156,750 | |
2.50%, 1/1/2028 | | | 904,633 | | | | 859,557 | |
2.50%, 4/1/2028 | | | 54,526 | | | | 51,794 | |
2.50%, 9/1/2028 | | | 43,023 | | | | 40,900 | |
3.50%, 12/1/2028 | | | 83,527 | | | | 79,309 | |
3.00%, 2/1/2029 | | | 109,383 | | | | 104,406 | |
2.50%, 3/1/2029 | | | 204,796 | | | | 194,072 | |
2.50%, 6/1/2029 | | | 75,856 | | | | 72,107 | |
3.50%, 12/1/2029 | | | 661,225 | | | | 633,279 | |
2.50%, 7/1/2030 | | | 190,404 | | | | 180,470 | |
3.00%, 7/1/2030 | | | 738,979 | | | | 705,721 | |
2.50%, 8/1/2030 | | | 848,087 | | | | 784,452 | |
3.00%, 9/1/2030 | | | 1,051,550 | | | | 1,004,678 | |
3.50%, 10/1/2030 | | | 47,505 | | | | 44,210 | |
3.50%, 11/1/2030 | | | 8,075 | | | | 7,515 | |
3.00%, 12/1/2030 | | | 1,308,078 | | | | 1,228,399 | |
3.50%, 2/1/2031 | | | 715,346 | | | | 679,224 | |
2.50%, 3/1/2031 | | | 397,522 | | | | 375,352 | |
4.00%, 8/1/2031 | | | 163,401 | | | | 154,962 | |
2.00%, 9/1/2031 | | | 22,387 | | | | 20,082 | |
2.00%, 11/1/2031 | | | 53,323 | | | | 47,834 | |
4.00%, 12/1/2031 | | | 56,895 | | | | 53,903 | |
4.00%, 3/1/2032 | | | 40,382 | | | | 38,221 | |
3.50%, 7/1/2032 | | | 215,176 | | | | 200,213 | |
3.50%, 10/1/2032 | | | 238,507 | | | | 231,996 | |
6.00%, 12/1/2032 | | | 9,446 | | | | 9,382 | |
6.00%, 4/1/2033 | | | 6,427 | | | | 6,398 | |
4.00%, 10/1/2033 | | | 33,068 | | | | 31,362 | |
4.00%, 3/1/2034 | | | 445,446 | | | | 433,224 | |
6.00%, 8/1/2034 | | | 31,528 | | | | 31,622 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 379 | |
FlexShares® Disciplined Duration MBS Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
MORTGAGE-BACKED SECURITIES – (continued) | |
6.50%, 9/1/2034 | | $ | 90,193 | | | $ | 91,704 | |
6.00%, 12/1/2034 | | | 144,093 | | | | 144,347 | |
3.00%, 2/1/2035 | | | 697,635 | | | | 655,199 | |
3.00%, 7/1/2035 | | | 984,880 | | | | 921,524 | |
5.00%, 8/1/2035 | | | 19,522 | | | | 18,930 | |
1.50%, 10/1/2035 | | | 153,511 | | | | 127,184 | |
6.00%, 11/1/2035 | | | 28,083 | | | | 28,077 | |
5.00%, 12/1/2035 | | | 43,163 | | | | 41,845 | |
6.00%, 6/1/2036 | | | 39,237 | | | | 39,355 | |
2.00%, 7/1/2036 | | | 914,065 | | | | 779,015 | |
2.50%, 7/1/2036 | | | 714,102 | | | | 623,580 | |
5.00%, 7/1/2036 | | | 19,048 | | | | 18,466 | |
6.50%, 8/1/2036 | | | 14,466 | | | | 14,855 | |
2.50%, 11/1/2036 | | | 334,483 | | | | 289,098 | |
6.00%, 11/1/2036 | | | 37,246 | | | | 37,358 | |
1.50%, 2/1/2037 | | | 853,796 | | | | 702,407 | |
2.50%, 4/1/2037 | | | 791,186 | | | | 682,241 | |
1.50%, 8/1/2037 | | | 295,482 | | | | 243,381 | |
6.00%, 8/1/2037 | | | 130,800 | | | | 131,009 | |
6.00%, 9/1/2037 | | | 18,699 | | | | 18,756 | |
6.50%, 10/1/2037 | | | 29,506 | | | | 29,918 | |
5.00%, 3/1/2038 | | | 47,444 | | | | 45,658 | |
5.00%, 5/1/2038 | | | 36,882 | | | | 35,772 | |
6.00%, 5/1/2038 | | | 12,966 | | | | 13,001 | |
6.00%, 9/1/2038 | | | 24,012 | | | | 24,060 | |
5.00%, 6/1/2039 | | | 42,328 | | | | 40,887 | |
3.50%, 8/1/2039 | | | 465,308 | | | | 425,127 | |
5.00%, 10/1/2039 | | | 40,583 | | | | 38,975 | |
3.00%, 1/1/2040 | | | 36,155 | | | | 30,834 | |
5.00%, 2/1/2040 | | | 36,266 | | | | 35,178 | |
5.00%, 6/1/2040 | | | 13,639 | | | | 13,062 | |
6.00%, 6/1/2040 | | | 99,764 | | | | 99,923 | |
3.50%, 1/1/2041 | | | 33,863 | | | | 29,737 | |
1.50%, 2/1/2041 | | | 771,665 | | | | 579,370 | |
3.50%, 2/1/2041 | | | 21,926 | | | | 19,255 | |
1.50%, 4/1/2041 | | | 417,407 | | | | 312,356 | |
2.00%, 5/1/2041 | | | 478,150 | | | | 378,269 | |
4.50%, 5/1/2041 | | | 36,523 | | | | 33,696 | |
5.00%, 5/1/2041 | | | 30,756 | | | | 29,309 | |
6.00%, 5/1/2041 | | | 22,324 | | | | 22,383 | |
4.50%, 6/1/2041 | | | 12,097 | | | | 11,150 | |
2.50%, 7/1/2041 | | | 581,023 | | | | 469,486 | |
5.00%, 7/1/2041 | | | 406,148 | | | | 386,803 | |
6.00%, 7/1/2041 | | | 25,538 | | | | 25,614 | |
4.50%, 8/1/2041 | | | 107,399 | | | | 99,156 | |
5.00%, 8/1/2041 | | | 57,294 | | | | 54,872 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
4.00%, 9/1/2041 | | $ | 178,241 | | | $ | 159,388 | |
4.50%, 9/1/2041 | | | 68,576 | | | | 63,210 | |
3.50%, 10/1/2041 | | | 123,077 | | | | 108,075 | |
4.00%, 10/1/2041 | | | 45,425 | | | | 40,445 | |
5.00%, 10/1/2041 | | | 59,935 | | | | 57,070 | |
4.00%, 11/1/2041 | | | 66,464 | | | | 59,433 | |
4.00%, 12/1/2041 | | | 16,713 | | | | 14,945 | |
4.00%, 1/1/2042 | | | 154,223 | | | | 136,157 | |
4.50%, 1/1/2042 | | | 16,893 | | | | 15,596 | |
6.00%, 1/1/2042 | | | 63,361 | | | | 63,552 | |
3.00%, 3/1/2042 | | | 25,318 | | | | 21,361 | |
4.00%, 3/1/2042 | | | 77,289 | | | | 69,503 | |
3.00%, 4/1/2042 | | | 46,922 | | | | 39,593 | |
4.50%, 4/1/2042 | | | 85,870 | | | | 79,279 | |
3.50%, 5/1/2042 | | | 22,296 | | | | 19,579 | |
4.50%, 5/1/2042 | | | 62,984 | | | | 58,149 | |
3.50%, 6/1/2042 | | | 41,370 | | | | 36,328 | |
3.50%, 7/1/2042 | | | 125,830 | | | | 110,495 | |
4.00%, 7/1/2042 | | | 104,367 | | | | 93,328 | |
3.50%, 8/1/2042 | | | 38,711 | | | | 33,993 | |
3.00%, 9/1/2042 | | | 67,495 | | | | 56,915 | |
3.50%, 9/1/2042 | | | 12,378 | | | | 10,870 | |
4.00%, 9/1/2042 | | | 65,381 | | | | 58,357 | |
3.00%, 10/1/2042 | | | 137,144 | | | | 115,699 | |
3.50%, 10/1/2042 | | | 23,774 | | | | 20,877 | |
2.50%, 12/1/2042 | | | 223,488 | | | | 177,210 | |
3.00%, 12/1/2042 | | | 130,451 | | | | 110,000 | |
2.50%, 1/1/2043 | | | 7,713 | | | | 6,116 | |
3.00%, 1/1/2043 | | | 126,664 | | | | 106,640 | |
3.50%, 1/1/2043 | | | 35,644 | | | | 31,123 | |
4.00%, 1/1/2043 | | | 68,408 | | | | 61,172 | |
4.50%, 1/1/2043 | | | 169,653 | | | | 156,636 | |
2.50%, 2/1/2043 | | | 292,267 | | | | 231,390 | |
3.00%, 2/1/2043 | | | 174,435 | | | | 146,954 | |
3.50%, 2/1/2043 | | | 67,342 | | | | 59,129 | |
3.50%, 3/1/2043 | | | 79,723 | | | | 70,003 | |
2.50%, 5/1/2043 | | | 11,826 | | | | 9,283 | |
2.50%, 6/1/2043 | | | 6,304 | | | | 4,988 | |
4.00%, 8/1/2043 | | | 37,277 | | | | 33,101 | |
4.00%, 9/1/2043 | | | 87,836 | | | | 78,174 | |
4.50%, 9/1/2043 | | | 25,082 | | | | 23,015 | |
4.00%, 10/1/2043 | | | 107,858 | | | | 95,714 | |
4.00%, 11/1/2043 | | | 226,639 | | | | 201,103 | |
4.50%, 11/1/2043 | | | 83,664 | | | | 76,719 | |
4.50%, 12/1/2043 | | | 61,041 | | | | 56,072 | |
4.00%, 1/1/2044 | | | 87,071 | | | | 77,266 | |
4.50%, 2/1/2044 | | | 16,390 | | | | 15,029 | |
4.50%, 3/1/2044 | | | 103,206 | | | | 96,314 | |
See Accompanying Notes to the Financial Statements.
| | | | |
380 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Disciplined Duration MBS Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
MORTGAGE-BACKED SECURITIES – (continued) | |
5.00%, 3/1/2044 | | $ | 17,045 | | | $ | 16,120 | |
4.00%, 4/1/2044 | | | 840,185 | | | | 742,772 | |
4.50%, 4/1/2044 | | | 179,611 | | | | 164,703 | |
5.00%, 6/1/2044 | | | 29,908 | | | | 28,391 | |
4.00%, 10/1/2044 | | | 34,254 | | | | 30,422 | |
4.50%, 10/1/2044 | | | 7,772 | | | | 7,127 | |
4.50%, 12/1/2044 | | | 31,693 | | | | 29,077 | |
4.00%, 2/1/2045 | | | 24,931 | | | | 22,091 | |
4.50%, 2/1/2045 | | | 108,072 | | | | 99,106 | |
4.00%, 4/1/2045 | | | 22,670 | | | | 20,073 | |
4.00%, 8/1/2045 | | | 10,768 | | | | 9,533 | |
4.00%, 11/1/2045 | | | 62,102 | | | | 54,942 | |
4.50%, 11/1/2045 | | | 73,019 | | | | 66,959 | |
4.00%, 12/1/2045 | | | 144,226 | | | | 128,380 | |
4.00%, 2/1/2046 | | | 7,138 | | | | 6,366 | |
4.50%, 3/1/2046 | | | 117,134 | | | | 107,363 | |
4.00%, 4/1/2046 | | | 10,703 | | | | 9,488 | |
2.50%, 6/1/2046 | | | 71,052 | | | | 56,344 | |
4.50%, 6/1/2046 | | | 76,511 | | | | 70,162 | |
4.50%, 7/1/2046 | | | 16,052 | | | | 14,714 | |
4.50%, 8/1/2046 | | | 13,515 | | | | 12,394 | |
2.50%, 10/1/2046 | | | 57,674 | | | | 45,144 | |
4.50%, 10/1/2046 | | | 27,931 | | | | 25,589 | |
2.50%, 12/1/2046 | | | 19,456 | | | | 15,209 | |
4.50%, 1/1/2047 | | | 25,073 | | | | 22,976 | |
4.00%, 2/1/2047 | | | 27,888 | | | | 24,679 | |
4.50%, 2/1/2047 | | | 31,008 | | | | 28,525 | |
4.50%, 5/1/2047 | | | 479,084 | | | | 435,566 | |
4.50%, 7/1/2047 | | | 69,658 | | | | 63,875 | |
5.00%, 7/1/2047 | | | 27,584 | | | | 26,503 | |
5.50%, 2/1/2049 | | | 1,711,107 | | | | 1,679,909 | |
6.00%, 2/1/2049 | | | 78,442 | | | | 79,786 | |
4.50%, 7/1/2049 | | | 461,406 | | | | 418,845 | |
4.50%, 11/1/2049 | | | 460,795 | | | | 422,489 | |
4.50%, 5/1/2050 | | | 739,925 | | | | 670,265 | |
5.00%, 6/1/2050 | | | 1,062,207 | | | | 996,917 | |
3.50%, 7/1/2050 | | | 468,469 | | | | 404,427 | |
4.00%, 7/1/2050 | | | 1,285,484 | | | | 1,124,606 | |
4.50%, 10/1/2050 | | | 1,202,357 | | | | 1,094,565 | |
5.00%, 10/1/2050 | | | 978,631 | | | | 917,264 | |
6.50%, 11/1/2053 | | | 1,000,000 | | | | 994,429 | |
| | |
GNMA | | | | | | | | |
5.50%, 8/20/2033 | | | 25,044 | | | | 24,826 | |
5.50%, 11/20/2033 | | | 23,622 | | | | 23,416 | |
5.50%, 3/20/2034 | | | 29,053 | | | | 28,800 | |
5.50%, 7/20/2034 | | | 18,226 | | | | 18,068 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
5.50%, 9/20/2034 | | $ | 8,077 | | | $ | 7,791 | |
5.50%, 3/20/2036 | | | 60,062 | | | | 59,541 | |
5.50%, 9/20/2038 | | | 36,426 | | | | 36,108 | |
5.50%, 2/20/2039 | | | 59,919 | | | | 59,398 | |
4.50%, 5/15/2039 | | | 1,506,962 | | | | 1,427,208 | |
5.00%, 11/15/2039 | | | 479,704 | | | | 460,047 | |
4.00%, 6/15/2040 | | | 293,465 | | | | 269,012 | |
4.00%, 8/15/2040 | | | 289,615 | | | | 265,417 | |
4.00%, 11/15/2040 | | | 223,255 | | | | 204,137 | |
5.50%, 12/20/2040 | | | 17,216 | | | | 17,049 | |
5.50%, 1/20/2041 | | | 18,443 | | | | 18,282 | |
4.00%, 9/15/2041 | | | 833,688 | | | | 756,369 | |
5.50%, 12/20/2041 | | | 44,220 | | | | 43,049 | |
5.50%, 2/20/2042 | | | 12,110 | | | | 12,005 | |
3.00%, 4/15/2042 | | | 999,025 | | | | 858,216 | |
3.50%, 6/15/2042 | | | 432,931 | | | | 383,733 | |
2.50%, 3/20/2043 | | | 38,240 | | | | 31,056 | |
2.50%, 5/20/2043 | | | 55,731 | | | | 45,269 | |
5.50%, 3/20/2044 | | | 51,183 | | | | 50,737 | |
4.50%, 10/20/2044 | | | 112,926 | | | | 105,022 | |
2.50%, 11/20/2044 | | | 33,713 | | | | 27,377 | |
5.00%, 6/20/2045 | | | 142,118 | | | | 136,445 | |
4.00%, 8/15/2045 | | | 1,060,139 | | | | 964,078 | |
4.50%, 12/20/2045 | | | 236,839 | | | | 219,385 | |
4.50%, 4/20/2046 | | | 274,508 | | | | 255,386 | |
5.00%, 5/20/2046 | | | 338,136 | | | | 325,447 | |
3.50%, 6/15/2046 | | | 1,803,668 | | | | 1,595,211 | |
3.50%, 10/20/2047 | | | 1,010,017 | | | | 872,594 | |
4.00%, 2/20/2048 | | | 900,831 | | | | 805,154 | |
5.00%, 5/20/2048 | | | 125,614 | | | | 118,803 | |
5.50%, 1/20/2049 | | | 290,194 | | | | 281,458 | |
5.50%, 7/20/2049 | | | 8,264 | | | | 8,060 | |
4.00%, 12/20/2051 | | | 404,141 | | | | 358,358 | |
5.50%, 12/20/2052 | | | 572,146 | | | | 547,937 | |
6.50%, 6/20/2053 | | | 1,776,889 | | | | 1,774,649 | |
7.00%, 8/20/2053 | | | 996,642 | | | | 1,010,393 | |
7.00%, 9/20/2053 | | | 1,198,206 | | | | 1,214,611 | |
Total Mortgage-Backed Securities (Cost $81,464,885) | | | | 73,778,449 | |
| | | | | | | | |
Total Investments – 99.1% (Cost $81,464,885) | | | | 73,778,449 | |
| |
Other assets less liabilities – 0.9% | | | | 645,590 | |
NET ASSETS – 100.0% | | | $ | 74,424,039 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 381 | |
FlexShares® Disciplined Duration MBS Index Fund (cont.)
Percentages shown are based on Net Assets.
Abbreviations
FHLMC Federal Home Loan Mortgage Corp.
FNMA Federal National Mortgage Association
GNMA Government National Mortgage Association
UMBS Uniform Mortgage-Backed Securities
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 69,697 | |
Aggregate gross unrealized depreciation | | | (7,921,123 | ) |
Net unrealized depreciation | | $ | (7,851,426 | ) |
Federal income tax cost | | $ | 81,629,875 | |
| | | | |
Security Type | | % of Net Assets | |
Mortgage-Backed Securities | | | 99.1 | % |
Others(1) | | | 0.9 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
382 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Credit-Scored US Corporate Bond Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 96.7% | |
|
Aerospace & Defense – 1.2% | |
| | |
General Dynamics Corp. | | | | | | | | |
1.15%, 6/1/2026 | | $ | 250,000 | | | $ | 224,223 | |
3.50%, 4/1/2027 | | | 50,000 | | | | 46,879 | |
| | |
HEICO Corp. | | | | | | | | |
5.25%, 8/1/2028 | | | 200,000 | | | | 192,928 | |
5.35%, 8/1/2033 | | | 100,000 | | | | 91,785 | |
| | |
Hexcel Corp. | | | | | | | | |
4.20%, 2/15/2027(a) | | | 50,000 | | | | 45,909 | |
| | |
Howmet Aerospace, Inc. | | | | | | | | |
6.88%, 5/1/2025 | | | 300,000 | | | | 301,045 | |
3.00%, 1/15/2029 | | | 250,000 | | | | 211,017 | |
| | |
Huntington Ingalls Industries, Inc. | | | | | | | | |
3.84%, 5/1/2025 | | | 150,000 | | | | 145,175 | |
4.20%, 5/1/2030 | | | 200,000 | | | | 177,083 | |
| | |
L3Harris Technologies, Inc. | | | | | | | | |
4.40%, 6/15/2028 | | | 400,000 | | | | 373,565 | |
| | |
Leidos, Inc. | | | | | | | | |
4.38%, 5/15/2030 | | | 252,000 | | | | 221,567 | |
2.30%, 2/15/2031 | | | 150,000 | | | | 112,814 | |
5.75%, 3/15/2033 | | | 130,000 | | | | 120,826 | |
| | |
Lockheed Martin Corp. | | | | | | | | |
3.55%, 1/15/2026 | | | 152,000 | | | | 146,133 | |
3.90%, 6/15/2032 | | | 140,000 | | | | 122,544 | |
5.25%, 1/15/2033 | | | 100,000 | | | | 96,352 | |
| | |
Textron, Inc. | | | | | | | | |
3.88%, 3/1/2025 | | | 250,000 | | | | 242,966 | |
3.90%, 9/17/2029 | | | 200,000 | | | | 177,755 | |
3.00%, 6/1/2030 | | | 200,000 | | | | 164,884 | |
| | | | | | | 3,215,450 | |
|
Air Freight & Logistics – 0.1% | |
| | |
CH Robinson Worldwide, Inc. | | | | | | | | |
4.20%, 4/15/2028 | | | 212,000 | | | | 195,771 | |
|
Automobile Components – 0.2% | |
| | |
Lear Corp. | | | | | | | | |
4.25%, 5/15/2029 | | | 150,000 | | | | 134,110 | |
| | |
Magna International, Inc. | | | | | | | | |
4.15%, 10/1/2025 | | | 250,000 | | | | 242,815 | |
2.45%, 6/15/2030 | | | 200,000 | | | | 161,416 | |
5.50%, 3/21/2033 | | | 100,000 | | | | 95,388 | |
| | | | | | | 633,729 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – 25.4% | |
| | |
Banco Bilbao Vizcaya Argentaria SA | | | | | | | | |
5.86%, 9/14/2026(b) | | $ | 200,000 | | | $ | 197,028 | |
6.14%, 9/14/2028(b) | | | 200,000 | | | | 195,266 | |
| | |
Banco Santander SA | | | | | | | | |
3.50%, 3/24/2025 | | | 110,000 | | | | 105,793 | |
5.18%, 11/19/2025 | | | 81,000 | | | | 78,192 | |
1.85%, 3/25/2026 | | | 110,000 | | | | 98,273 | |
1.72%, 9/14/2027(b) | | | 202,000 | | | | 175,090 | |
2.75%, 12/3/2030 | | | 200,000 | | | | 145,875 | |
6.92%, 8/8/2033 | | | 200,000 | | | | 185,756 | |
| | |
Bank of America Corp. | | | | | | | | |
Series L, 3.95%, 4/21/2025 | | | 480,000 | | | | 463,927 | |
4.45%, 3/3/2026 | | | 300,000 | | | | 287,274 | |
3.38%, 4/2/2026(b) | | | 250,000 | | | | 239,538 | |
1.32%, 6/19/2026(b) | | | 250,000 | | | | 229,755 | |
4.83%, 7/22/2026(b) | | | 250,000 | | | | 243,616 | |
4.25%, 10/22/2026 | | | 350,000 | | | | 330,294 | |
5.08%, 1/20/2027(b) | | | 150,000 | | | | 146,020 | |
Series N, 1.66%, 3/11/2027(b) | | | 50,000 | | | | 44,737 | |
3.56%, 4/23/2027(b) | | | 361,000 | | | | 337,185 | |
1.73%, 7/22/2027(b) | | | 724,000 | | | | 638,937 | |
5.93%, 9/15/2027(b) | | | 250,000 | | | | 247,446 | |
Series L, 4.18%, 11/25/2027 | | | 300,000 | | | | 275,948 | |
3.82%, 1/20/2028(b) | | | 200,000 | | | | 184,574 | |
3.59%, 7/21/2028(b) | | | 201,000 | | | | 181,895 | |
4.95%, 7/22/2028(b) | | | 129,000 | | | | 122,594 | |
3.42%, 12/20/2028(b) | | | 300,000 | | | | 267,039 | |
3.97%, 3/5/2029(b) | | | 135,000 | | | | 122,153 | |
5.20%, 4/25/2029(b) | | | 230,000 | | | | 218,676 | |
2.09%, 6/14/2029(b) | | | 230,000 | | | | 189,899 | |
4.27%, 7/23/2029(b) | | | 250,000 | | | | 227,504 | |
5.82%, 9/15/2029(b) | | | 100,000 | | | | 97,373 | |
3.97%, 2/7/2030(b) | | | 900,000 | | | | 795,938 | |
2.59%, 4/29/2031(b) | | | 100,000 | | | | 78,836 | |
1.90%, 7/23/2031(b) | | | 100,000 | | | | 74,397 | |
Series N, 2.65%, 3/11/2032(b) | | | 110,000 | | | | 84,301 | |
2.69%, 4/22/2032(b) | | | 184,000 | | | | 141,082 | |
2.30%, 7/21/2032(b) | | | 194,000 | | | | 143,126 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 383 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Banks – (continued) | |
2.57%, 10/20/2032(b) | | $ | 100,000 | | | $ | 74,894 | |
2.97%, 2/4/2033(b) | | | 111,000 | | | | 85,074 | |
4.57%, 4/27/2033(b) | | | 221,000 | | | | 190,592 | |
5.02%, 7/22/2033(b) | | | 222,000 | | | | 198,485 | |
5.29%, 4/25/2034(b) | | | 331,000 | | | | 298,956 | |
2.48%, 9/21/2036(b) | | | 250,000 | | | | 178,174 | |
3.85%, 3/8/2037(b) | | | 312,000 | | | | 246,133 | |
| | |
Bank of America NA | | | | | | | | |
5.53%, 8/18/2026 | | | 250,000 | | | | 248,067 | |
| | |
Bank of Montreal | | | | | | | | |
1.85%, 5/1/2025 | | | 250,000 | | | | 234,953 | |
5.30%, 6/5/2026 | | | 400,000 | | | | 393,544 | |
1.25%, 9/15/2026 | | | 250,000 | | | | 219,120 | |
3.80%, 12/15/2032(b) | | | 495,000 | | | | 428,994 | |
3.09%, 1/10/2037(b) | | | 350,000 | | | | 252,811 | |
| | |
Bank of Nova Scotia (The) | | | | | | | | |
1.45%, 1/10/2025 | | | 300,000 | | | | 284,356 | |
4.50%, 12/16/2025 | | | 300,000 | | | | 289,315 | |
4.59%, 5/4/2037(b) | | | 300,000 | | | | 242,601 | |
Series 2, 3.63%, 10/27/2081(b) | | | 200,000 | | | | 140,358 | |
8.63%, 10/27/2082(b) | | | 250,000 | | | | 244,561 | |
| | |
Bank OZK | | | | | | | | |
2.75%, 10/1/2031(b) | | | 101,000 | | | | 74,246 | |
| | |
BankUnited, Inc. | | | | | | | | |
4.88%, 11/17/2025 | | | 100,000 | | | | 93,312 | |
5.13%, 6/11/2030 | | | 80,000 | | | | 63,293 | |
| | |
Barclays plc | | | | | | | | |
3.65%, 3/16/2025 | | | 101,000 | | | | 97,127 | |
5.20%, 5/12/2026 | | | 172,000 | | | | 164,270 | |
5.30%, 8/9/2026(b) | | | 213,000 | | | | 207,835 | |
4.84%, 5/9/2028 | | | 273,000 | | | | 245,342 | |
4.97%, 5/16/2029(b) | | | 200,000 | | | | 184,109 | |
5.09%, 6/20/2030(b) | | | 200,000 | | | | 173,311 | |
7.44%, 11/2/2033(b) | | | 300,000 | | | | 299,333 | |
7.12%, 6/27/2034(b) | | | 250,000 | | | | 232,171 | |
3.56%, 9/23/2035(b) | | | 200,000 | | | | 150,613 | |
| | |
Cadence Bank | | | | | | | | |
4.13%, 11/20/2029(b) | | | 100,000 | | | | 90,761 | |
| | |
Capital One NA | | | | | | | | |
2.28%, 1/28/2026(b) | | | 250,000 | | | | 235,895 | |
| | |
Citigroup, Inc. | | | | | | | | |
3.88%, 3/26/2025 | | | 200,000 | | | | 192,910 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – (continued) | |
4.40%, 6/10/2025 | | $ | 350,000 | | | $ | 338,733 | |
5.50%, 9/13/2025 | | | 100,000 | | | | 98,595 | |
4.60%, 3/9/2026 | | | 484,000 | | | | 463,885 | |
3.11%, 4/8/2026(b) | | | 574,000 | | | | 547,814 | |
3.20%, 10/21/2026 | | | 403,000 | | | | 371,511 | |
4.30%, 11/20/2026 | | | 250,000 | | | | 234,926 | |
1.46%, 6/9/2027(b) | | | 400,000 | | | | 352,081 | |
4.45%, 9/29/2027 | | | 1,010,000 | | | | 932,979 | |
3.89%, 1/10/2028(b) | | | 150,000 | | | | 139,062 | |
3.67%, 7/24/2028(b) | | | 352,000 | | | | 318,885 | |
4.13%, 7/25/2028 | | | 454,000 | | | | 407,527 | |
4.08%, 4/23/2029(b) | | | 252,000 | | | | 229,201 | |
3.98%, 3/20/2030(b) | | | 757,000 | | | | 669,733 | |
4.41%, 3/31/2031(b) | | | 600,000 | | | | 530,823 | |
2.57%, 6/3/2031(b) | | | 252,000 | | | | 197,330 | |
2.56%, 5/1/2032(b) | | | 200,000 | | | | 151,761 | |
6.63%, 6/15/2032 | | | 250,000 | | | | 247,629 | |
3.06%, 1/25/2033(b) | | | 302,000 | | | | 232,512 | |
5.88%, 2/22/2033 | | | 100,000 | | | | 93,948 | |
3.79%, 3/17/2033(b) | | | 50,000 | | | | 40,591 | |
4.91%, 5/24/2033(b) | | | 50,000 | | | | 44,312 | |
6.27%, 11/17/2033(b) | | | 253,000 | | | | 245,652 | |
6.17%, 5/25/2034(b) | | | 950,000 | | | | 883,058 | |
| | |
Citizens Bank NA | | | | | | | | |
2.25%, 4/28/2025 | | | 695,000 | | | | 643,651 | |
6.06%, 10/24/2025(b) | | | 250,000 | | | | 239,068 | |
4.58%, 8/9/2028(b) | | | 500,000 | | | | 443,446 | |
| | |
Citizens Financial Group, Inc. | | | | | | | | |
2.85%, 7/27/2026 | | | 60,000 | | | | 53,312 | |
3.25%, 4/30/2030 | | | 202,000 | | | | 155,802 | |
5.64%, 5/21/2037(b) | | | 250,000 | | | | 199,414 | |
| | |
Comerica Bank | | | | | | | | |
5.33%, 8/25/2033(b) | | | 250,000 | | | | 193,597 | |
| | |
Comerica, Inc. | | | | | | | | |
4.00%, 2/1/2029 | | | 183,000 | | | | 149,719 | |
| | |
Cooperatieve Rabobank UA | | | | | | | | |
5.00%, 1/13/2025 | | | 250,000 | | | | 247,698 | |
3.38%, 5/21/2025 | | | 250,000 | | | | 240,713 | |
3.75%, 7/21/2026 | | | 252,000 | | | | 234,127 | |
| | |
Discover Bank | | | | | | | | |
4.25%, 3/13/2026 | | | 250,000 | | | | 235,956 | |
3.45%, 7/27/2026 | | | 252,000 | | | | 228,083 | |
4.65%, 9/13/2028 | | | 327,000 | | | | 287,388 | |
2.70%, 2/6/2030 | | | 303,000 | | | | 228,417 | |
See Accompanying Notes to the Financial Statements.
| | | | |
384 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Banks – (continued) | |
| | |
Fifth Third Bancorp | | | | | | | | |
2.55%, 5/5/2027 | | $ | 202,000 | | | $ | 174,466 | |
1.71%, 11/1/2027(b) | | | 50,000 | | | | 42,616 | |
6.36%, 10/27/2028(b) | | | 505,000 | | | | 491,512 | |
6.34%, 7/27/2029(b) | | | 100,000 | | | | 96,860 | |
4.77%, 7/28/2030(b) | | | 178,000 | | | | 157,747 | |
| | |
Fifth Third Bank NA | | | | | | | | |
3.85%, 3/15/2026 | | | 243,000 | | | | 223,878 | |
| | |
First Citizens BancShares, Inc. | | | | | | | | |
3.38%, 3/15/2030(b) | | | 200,000 | | | | 186,463 | |
| | |
First Horizon Bank | | | | | | | | |
5.75%, 5/1/2030 | | | 250,000 | | | | 211,589 | |
| | |
HSBC Holdings plc | | | | | | | | |
4.25%, 8/18/2025 | | | 300,000 | | | | 287,387 | |
4.30%, 3/8/2026 | | | 200,000 | | | | 191,665 | |
3.90%, 5/25/2026 | | | 200,000 | | | | 188,710 | |
2.10%, 6/4/2026(b) | | | 742,000 | | | | 691,403 | |
4.29%, 9/12/2026(b) | | | 150,000 | | | | 143,928 | |
4.38%, 11/23/2026 | | | 640,000 | | | | 603,866 | |
1.59%, 5/24/2027(b) | | | 250,000 | | | | 220,204 | |
5.89%, 8/14/2027(b) | | | 250,000 | | | | 245,605 | |
2.25%, 11/22/2027(b) | | | 232,000 | | | | 203,408 | |
4.04%, 3/13/2028(b) | | | 414,000 | | | | 380,248 | |
4.76%, 6/9/2028(b) | | | 280,000 | | | | 262,157 | |
5.21%, 8/11/2028(b) | | | 250,000 | | | | 238,453 | |
7.39%, 11/3/2028(b) | | | 283,000 | | | | 290,301 | |
4.58%, 6/19/2029(b) | | | 620,000 | | | | 564,970 | |
2.21%, 8/17/2029(b) | | | 250,000 | | | | 203,405 | |
3.97%, 5/22/2030(b) | | | 928,000 | | | | 801,775 | |
2.36%, 8/18/2031(b) | | | 50,000 | | | | 37,686 | |
7.63%, 5/17/2032 | | | 100,000 | | | | 101,966 | |
2.80%, 5/24/2032(b) | | | 202,000 | | | | 152,080 | |
2.87%, 11/22/2032(b) | | | 450,000 | | | | 335,481 | |
4.76%, 3/29/2033(b) | | | 202,000 | | | | 167,120 | |
5.40%, 8/11/2033(b) | | | 202,000 | | | | 181,633 | |
8.11%, 11/3/2033(b) | | | 200,000 | | | | 206,967 | |
6.25%, 3/9/2034(b) | | | 300,000 | | | | 284,753 | |
6.55%, 6/20/2034(b) | | | 600,000 | | | | 557,608 | |
| | |
Huntington Bancshares, Inc. | | | | | | | | |
4.00%, 5/15/2025 | | | 151,000 | | | | 144,680 | |
4.44%, 8/4/2028(b) | | | 131,000 | | | | 119,650 | |
2.55%, 2/4/2030 | | | 132,000 | | | | 101,588 | |
2.49%, 8/15/2036(b) | | | 100,000 | | | | 67,309 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – (continued) | |
| | |
Huntington National Bank (The) | | | | | | | | |
5.70%, 11/18/2025(b) | | $ | 502,000 | | | $ | 487,400 | |
4.55%, 5/17/2028(b) | | | 250,000 | | | | 229,780 | |
5.65%, 1/10/2030 | | | 344,000 | | | | 315,160 | |
| | |
ING Groep NV | | | | | | | | |
1.73%, 4/1/2027(b) | | | 112,000 | | | | 100,039 | |
6.11%, 9/11/2034(b) | | | 100,000 | | | | 93,705 | |
| | |
JPMorgan Chase & Co. | | | | | | | | |
2.01%, 3/13/2026(b) | | | 410,000 | | | | 386,899 | |
2.08%, 4/22/2026(b) | | | 900,000 | | | | 845,843 | |
1.05%, 11/19/2026(b) | | | 40,000 | | | | 35,975 | |
4.13%, 12/15/2026 | | | 250,000 | | | | 236,198 | |
3.96%, 1/29/2027(b) | | | 360,000 | | | | 343,153 | |
1.58%, 4/22/2027(b) | | | 932,000 | | | | 831,469 | |
1.47%, 9/22/2027(b) | | | 250,000 | | | | 217,784 | |
6.07%, 10/22/2027(b) | | | 250,000 | | | | 249,472 | |
3.78%, 2/1/2028(b) | | | 250,000 | | | | 231,950 | |
4.32%, 4/26/2028(b) | | | 250,000 | | | | 234,835 | |
3.54%, 5/1/2028(b) | | | 531,000 | | | | 486,044 | |
2.18%, 6/1/2028(b) | | | 121,000 | | | | 105,185 | |
3.51%, 1/23/2029(b) | | | 120,000 | | | | 107,668 | |
4.01%, 4/23/2029(b) | | | 352,000 | | | | 320,577 | |
2.07%, 6/1/2029(b) | | | 50,000 | | | | 41,561 | |
4.20%, 7/23/2029(b) | | | 253,000 | | | | 232,027 | |
4.45%, 12/5/2029(b) | | | 253,000 | | | | 232,709 | |
3.70%, 5/6/2030(b) | | | 290,000 | | | | 254,432 | |
4.57%, 6/14/2030(b) | | | 250,000 | | | | 229,442 | |
8.75%, 9/1/2030 | | | 60,000 | | | | 67,715 | |
4.49%, 3/24/2031(b) | | | 171,000 | | | | 154,260 | |
2.52%, 4/22/2031(b) | | | 200,000 | | | | 159,067 | |
2.96%, 5/13/2031(b) | | | 600,000 | | | | 483,829 | |
1.95%, 2/4/2032(b) | | | 307,000 | | | | 228,069 | |
2.58%, 4/22/2032(b) | | | 60,000 | | | | 46,340 | |
2.96%, 1/25/2033(b) | | | 350,000 | | | | 272,683 | |
4.59%, 4/26/2033(b) | | | 163,000 | | | | 143,264 | |
4.91%, 7/25/2033(b) | | | 350,000 | | | | 314,380 | |
5.72%, 9/14/2033(b) | | | 400,000 | | | | 374,581 | |
| | |
KeyBank NA | | | | | | | | |
4.15%, 8/8/2025 | | | 303,000 | | | | 281,793 | |
4.70%, 1/26/2026 | | | 250,000 | | | | 232,187 | |
3.40%, 5/20/2026 | | | 505,000 | | | | 444,455 | |
5.85%, 11/15/2027 | | | 255,000 | | | | 236,157 | |
| | |
KeyCorp | | | | | | | | |
4.15%, 10/29/2025 | | | 50,000 | | | | 46,565 | |
2.25%, 4/6/2027 | | | 303,000 | | | | 251,475 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 385 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Banks – (continued) | |
4.10%, 4/30/2028 | | $ | 352,000 | | | $ | 301,118 | |
2.55%, 10/1/2029 | | | 151,000 | | | | 112,810 | |
| | |
Lloyds Banking Group plc | | | | | | | | |
4.58%, 12/10/2025 | | | 402,000 | | | | 382,329 | |
3.51%, 3/18/2026(b) | | | 202,000 | | | | 193,647 | |
4.65%, 3/24/2026 | | | 303,000 | | | | 286,956 | |
4.72%, 8/11/2026(b) | | | 250,000 | | | | 242,323 | |
3.57%, 11/7/2028(b) | | | 200,000 | | | | 177,575 | |
7.95%, 11/15/2033(b) | | | 200,000 | | | | 202,800 | |
| | |
M&T Bank Corp. | | | | | | | | |
4.55%, 8/16/2028(b) | | | 121,000 | | | | 110,198 | |
5.05%, 1/27/2034(b) | | | 250,000 | | | | 209,271 | |
| | |
Manufacturers & Traders Trust Co. | | | | | | | | |
2.90%, 2/6/2025 | | | 300,000 | | | | 284,460 | |
4.65%, 1/27/2026 | | | 505,000 | | | | 476,961 | |
3.40%, 8/17/2027 | | | 303,000 | | | | 257,736 | |
4.70%, 1/27/2028 | | | 252,000 | | | | 228,357 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | | | | | | |
2.19%, 2/25/2025 | | | 200,000 | | | | 190,046 | |
3.85%, 3/1/2026 | | | 252,000 | | | | 240,112 | |
2.34%, 1/19/2028(b) | | | 200,000 | | | | 176,752 | |
3.20%, 7/18/2029 | | | 214,000 | | | | 182,345 | |
2.31%, 7/20/2032(b) | | | 200,000 | | | | 149,153 | |
5.44%, 2/22/2034(b) | | | 200,000 | | | | 186,397 | |
| | |
Mizuho Financial Group, Inc. | | | | | | | | |
1.55%, 7/9/2027(b) | | | 260,000 | | | | 229,696 | |
4.02%, 3/5/2028 | | | 83,000 | | | | 76,681 | |
2.56%, 9/13/2031 | | | 250,000 | | | | 183,702 | |
2.26%, 7/9/2032(b) | | | 200,000 | | | | 147,102 | |
| | |
National Australia Bank Ltd. | | | | | | | | |
5.13%, 11/22/2024 | | | 132,000 | | | | 131,276 | |
4.97%, 1/12/2026 | | | 130,000 | | | | 128,464 | |
| | |
NatWest Group plc | | | | | | | | |
4.80%, 4/5/2026 | | | 82,000 | | | | 79,008 | |
7.47%, 11/10/2026(b) | | | 250,000 | | | | 254,396 | |
5.08%, 1/27/2030(b) | | | 443,000 | | | | 406,617 | |
4.45%, 5/8/2030(b) | | | 635,000 | | | | 562,871 | |
6.02%, 3/2/2034(b) | | | 200,000 | | | | 186,224 | |
| | |
PNC Bank NA | | | | | | | | |
4.05%, 7/26/2028 | | | 462,000 | | | | 411,440 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – (continued) | |
| | |
PNC Financial Services Group, Inc. (The) | | | | | | | | |
1.15%, 8/13/2026 | | $ | 200,000 | | | $ | 175,631 | |
5.07%, 1/24/2034(b) | | | 150,000 | | | | 131,992 | |
| | |
Regions Financial Corp. | | | | | | | | |
2.25%, 5/18/2025 | | | 242,000 | | | | 222,206 | |
1.80%, 8/12/2028 | | | 160,000 | | | | 125,026 | |
| | |
Royal Bank of Canada | | | | | | | | |
4.65%, 1/27/2026 | | | 493,000 | | | | 477,959 | |
5.00%, 2/1/2033 | | | 500,000 | | | | 452,057 | |
5.00%, 5/2/2033 | | | 270,000 | | | | 243,119 | |
| | |
Santander Holdings USA, Inc. | | | | | | | | |
3.45%, 6/2/2025 | | | 40,000 | | | | 37,843 | |
4.50%, 7/17/2025 | | | 72,000 | | | | 69,156 | |
2.49%, 1/6/2028(b) | | | 150,000 | | | | 129,138 | |
| | |
Santander UK Group Holdings plc | | | | | | | | |
3.82%, 11/3/2028(b) | | | 152,000 | | | | 133,747 | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | | | | | | |
1.40%, 9/17/2026 | | | 172,000 | | | | 150,970 | |
3.04%, 7/16/2029 | | | 140,000 | | | | 118,034 | |
2.72%, 9/27/2029 | | | 42,000 | | | | 34,571 | |
| | |
Synovus Bank | | | | | | | | |
5.63%, 2/15/2028 | | | 250,000 | | | | 222,034 | |
| | |
Toronto-Dominion Bank (The) | | | | | | | | |
5.53%, 7/17/2026 | | | 440,000 | | | | 435,446 | |
4.11%, 6/8/2027 | | | 200,000 | | | | 187,507 | |
4.69%, 9/15/2027 | | | 50,000 | | | | 47,618 | |
3.63%, 9/15/2031(b) | | | 505,000 | | | | 464,125 | |
2.45%, 1/12/2032 | | | 100,000 | | | | 75,251 | |
3.20%, 3/10/2032 | | | 100,000 | | | | 79,481 | |
4.46%, 6/8/2032 | | | 121,000 | | | | 105,511 | |
8.13%, 10/31/2082(b) | | | 505,000 | | | | 495,436 | |
| | |
Truist Bank | | | | | | | | |
3.63%, 9/16/2025 | | | 202,000 | | | | 190,571 | |
3.30%, 5/15/2026 | | | 230,000 | | | | 210,609 | |
3.80%, 10/30/2026 | | | 360,000 | | | | 329,755 | |
| | |
Truist Financial Corp. | | | | | | | | |
3.88%, 3/19/2029 | | | 273,000 | | | | 233,325 | |
| | |
US Bancorp | | | | | | | | |
3.10%, 4/27/2026 | | | 200,000 | | | | 184,358 | |
5.78%, 6/12/2029(b) | | | 100,000 | | | | 96,156 | |
4.97%, 7/22/2033(b) | | | 101,000 | | | | 84,523 | |
2.49%, 11/3/2036(b) | | | 100,000 | | | | 68,330 | |
See Accompanying Notes to the Financial Statements.
| | | | |
386 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Banks – (continued) | |
| | |
US Bank NA | | | | | | | | |
2.05%, 1/21/2025 | | $ | 2,000 | | | $ | 1,904 | |
| | |
Wachovia Corp. | | | | | | | | |
7.57%, 8/1/2026(a) | | | 200,000 | | | | 206,899 | |
| | |
Webster Financial Corp. | | | | | | | | |
4.10%, 3/25/2029 | | | 100,000 | | | | 82,990 | |
| | |
Wells Fargo & Co. | | | | | | | | |
3.00%, 4/22/2026 | | | 230,000 | | | | 213,700 | |
3.91%, 4/25/2026(b) | | | 250,000 | | | | 241,051 | |
2.19%, 4/30/2026(b) | | | 900,000 | | | | 846,629 | |
4.10%, 6/3/2026 | | | 812,000 | | | | 766,812 | |
3.00%, 10/23/2026 | | | 400,000 | | | | 366,424 | |
3.20%, 6/17/2027(b) | | | 922,000 | | | | 852,305 | |
3.53%, 3/24/2028(b) | | | 500,000 | | | | 455,887 | |
3.58%, 5/22/2028(b) | | | 116,000 | | | | 105,588 | |
2.39%, 6/2/2028(b) | | | 505,000 | | | | 440,192 | |
4.81%, 7/25/2028(b) | | | 353,000 | | | | 333,934 | |
5.57%, 7/25/2029(b) | | | 250,000 | | | | 241,071 | |
6.30%, 10/23/2029(b) | | | 250,000 | | | | 247,932 | |
Series B, 7.95%, 11/15/2029 | | | 250,000 | | | | 263,690 | |
2.57%, 2/11/2031(b) | | | 100,000 | | | | 79,181 | |
4.48%, 4/4/2031(b) | | | 300,000 | | | | 266,554 | |
3.35%, 3/2/2033(b) | | | 101,000 | | | | 79,524 | |
4.90%, 7/25/2033(b) | | | 303,000 | | | | 266,323 | |
5.39%, 4/24/2034(b) | | | 1,151,000 | | | | 1,041,949 | |
5.56%, 7/25/2034(b) | | | 250,000 | | | | 228,848 | |
| | |
Westpac Banking Corp. | | | | | | | | |
1.15%, 6/3/2026 | | | 250,000 | | | | 223,396 | |
5.46%, 11/18/2027 | | | 200,000 | | | | 198,492 | |
2.89%, 2/4/2030(b) | | | 400,000 | | | | 378,570 | |
4.32%, 11/23/2031(b) | | | 454,000 | | | | 419,040 | |
5.41%, 8/10/2033(b) | | | 300,000 | | | | 263,616 | |
4.11%, 7/24/2034(b) | | | 404,000 | | | | 342,933 | |
2.67%, 11/15/2035(b) | | | 300,000 | | | | 218,031 | |
3.02%, 11/18/2036(b) | | | 350,000 | | | | 251,754 | |
| | |
Wintrust Financial Corp. | | | | | | | | |
4.85%, 6/6/2029 | | | 100,000 | | | | 86,207 | |
| | |
Zions Bancorp NA | | | | | | | | |
3.25%, 10/29/2029 | | | 252,000 | | | | 187,671 | |
| | | | | | | 69,650,461 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Beverages – 0.9% | |
| | |
Brown-Forman Corp. | | | | | | | | |
4.75%, 4/15/2033 | | $ | 130,000 | | | $ | 120,549 | |
| | |
Coca-Cola Co. (The) | | | | | | | | |
3.45%, 3/25/2030 | | | 303,000 | | | | 269,903 | |
1.65%, 6/1/2030 | | | 200,000 | | | | 157,963 | |
1.38%, 3/15/2031 | | | 250,000 | | | | 187,581 | |
| | |
Constellation Brands, Inc. | | | | | | | | |
4.75%, 11/15/2024 | | | 250,000 | | | | 246,959 | |
3.60%, 2/15/2028 | | | 200,000 | | | | 182,925 | |
4.65%, 11/15/2028 | | | 252,000 | | | | 238,474 | |
2.88%, 5/1/2030 | | | 200,000 | | | | 164,693 | |
2.25%, 8/1/2031 | | | 100,000 | | | | 75,991 | |
| | |
Diageo Capital plc | | | | | | | | |
2.38%, 10/24/2029 | | | 244,000 | | | | 203,545 | |
| | |
PepsiCo, Inc. | | | | | | | | |
7.00%, 3/1/2029 | | | 100,000 | | | | 106,695 | |
2.75%, 3/19/2030 | | | 353,000 | | | | 300,653 | |
3.90%, 7/18/2032 | | | 150,000 | | | | 132,944 | |
| | | | | | | 2,388,875 | |
|
Biotechnology – 1.7% | |
| | |
AbbVie, Inc. | | | | | | | | |
2.60%, 11/21/2024 | | | 600,000 | | | | 579,756 | |
3.80%, 3/15/2025 | | | 853,000 | | | | 830,344 | |
3.60%, 5/14/2025 | | | 750,000 | | | | 725,557 | |
3.20%, 5/14/2026 | | | 252,000 | | | | 237,640 | |
2.95%, 11/21/2026 | | | 526,000 | | | | 487,162 | |
4.25%, 11/14/2028 | | | 222,000 | | | | 208,996 | |
3.20%, 11/21/2029 | | | 667,000 | | | | 581,269 | |
| | |
Biogen, Inc. | | | | | | | | |
4.05%, 9/15/2025 | | | 352,000 | | | | 339,691 | |
2.25%, 5/1/2030 | | | 250,000 | | | | 196,343 | |
| | |
Gilead Sciences, Inc. | | | | | | | | |
3.50%, 2/1/2025 | | | 382,000 | | | | 371,200 | |
| | |
Regeneron Pharmaceuticals, Inc. | | | | | | | | |
1.75%, 9/15/2030 | | | 250,000 | | | | 188,405 | |
| | | | | | | 4,746,363 | |
|
Building Products – 0.7% | |
| | |
Allegion plc | | | | | | | | |
3.50%, 10/1/2029 | | | 152,000 | | | | 130,433 | |
| | |
Carlisle Cos., Inc. | | | | | | | | |
3.75%, 12/1/2027 | | | 91,000 | | | | 83,500 | |
2.75%, 3/1/2030 | | | 183,000 | | | | 147,904 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 387 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Building Products – (continued) | |
| | |
Carrier Global Corp. | | | | | | | | |
2.24%, 2/15/2025 | | $ | 50,000 | | | $ | 47,606 | |
2.49%, 2/15/2027 | | | 100,000 | | | | 89,486 | |
| | |
Lennox International, Inc. | | | | | | | | |
1.35%, 8/1/2025 | | | 201,000 | | | | 185,805 | |
| | |
Masco Corp. | | | | | | | | |
3.50%, 11/15/2027 | | | 50,000 | | | | 45,200 | |
1.50%, 2/15/2028 | | | 101,000 | | | | 83,928 | |
| | |
Owens Corning | | | | | | | | |
3.40%, 8/15/2026 | | | 250,000 | | | | 232,566 | |
3.95%, 8/15/2029 | | | 143,000 | | | | 126,797 | |
| | |
Trane Technologies Financing Ltd. | | | | | | | | |
3.50%, 3/21/2026 | | | 202,000 | | | | 191,880 | |
3.80%, 3/21/2029 | | | 202,000 | | | | 184,352 | |
5.25%, 3/3/2033 | | | 130,000 | | | | 121,694 | |
| | |
Trane Technologies Global Holding Co. Ltd. | | | | | | | | |
3.75%, 8/21/2028 | | | 151,000 | | | | 138,812 | |
| | | | | | | 1,809,963 | |
|
Capital Markets – 4.6% | |
| | |
Ameriprise Financial, Inc. | | | | | | | | |
3.00%, 4/2/2025 | | | 250,000 | | | | 240,082 | |
5.15%, 5/15/2033 | | | 150,000 | | | | 138,450 | |
| | |
Ares Capital Corp. | | | | | | | | |
3.88%, 1/15/2026 | | | 150,000 | | | | 140,280 | |
2.15%, 7/15/2026 | | | 50,000 | | | | 43,915 | |
| | |
Bain Capital Specialty Finance, Inc. | | | | | | | | |
2.55%, 10/13/2026 | | | 227,000 | | | | 195,056 | |
| | |
Bank of New York Mellon Corp. (The) | | | | | | | | |
2.45%, 8/17/2026 | | | 173,000 | | | | 158,816 | |
3.85%, 4/28/2028 | | | 250,000 | | | | 231,726 | |
5.83%, 10/25/2033(b) | | | 50,000 | | | | 47,891 | |
4.71%, 2/1/2034(b) | | | 100,000 | | | | 87,817 | |
| | |
BlackRock, Inc. | | | | | | | | |
3.20%, 3/15/2027 | | | 101,000 | | | | 94,006 | |
3.25%, 4/30/2029 | | | 200,000 | | | | 178,541 | |
| | |
Blackstone Private Credit Fund | | | | | | | | |
2.70%, 1/15/2025 | | | 200,000 | | | | 189,799 | |
2.63%, 12/15/2026 | | | 352,000 | | | | 301,352 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Capital Markets – (continued) | |
3.25%, 3/15/2027 | | $ | 400,000 | | | $ | 345,038 | |
4.00%, 1/15/2029 | | | 175,000 | | | | 146,407 | |
| | |
Blackstone Secured Lending Fund | | | | | | | | |
3.63%, 1/15/2026 | | | 260,000 | | | | 240,175 | |
2.75%, 9/16/2026 | | | 252,000 | | | | 221,131 | |
2.13%, 2/15/2027 | | | 252,000 | | | | 212,809 | |
2.85%, 9/30/2028 | | | 200,000 | | | | 162,092 | |
| | |
Blue Owl Credit Income Corp. | | | | | | | | |
5.50%, 3/21/2025 | | | 250,000 | | | | 241,886 | |
7.95%, 6/13/2028(c) | | | 250,000 | | | | 244,402 | |
| | |
Blue Owl Technology Finance Corp. | | | | | | | | |
2.50%, 1/15/2027 | | | 100,000 | | | | 82,907 | |
| | |
Brookfield Finance, Inc. | | | | | | | | |
4.85%, 3/29/2029 | | | 100,000 | | | | 93,045 | |
| | |
Cboe Global Markets, Inc. | | | | | | | | |
3.65%, 1/12/2027 | | | 151,000 | | | | 142,285 | |
1.63%, 12/15/2030 | | | 151,000 | | | | 113,879 | |
| | |
Charles Schwab Corp. (The) | | | | | | | | |
4.00%, 2/1/2029 | | | 100,000 | | | | 89,818 | |
4.63%, 3/22/2030 | | | 30,000 | | | | 27,375 | |
1.65%, 3/11/2031 | | | 100,000 | | | | 71,231 | |
| | |
CI Financial Corp. | | | | | | | | |
3.20%, 12/17/2030 | | | 100,000 | | | | 73,172 | |
| | |
CME Group, Inc. | | | | | | | | |
3.00%, 3/15/2025 | | | 227,000 | | | | 219,744 | |
3.75%, 6/15/2028 | | | 1,000 | | | | 934 | |
2.65%, 3/15/2032 | | | 150,000 | | | | 119,738 | |
| | |
Credit Suisse AG | | | | | | | | |
1.25%, 8/7/2026 | | | 154,000 | | | | 134,345 | |
| | |
Deutsche Bank AG | | | | | | | | |
4.50%, 4/1/2025 | | | 303,000 | | | | 289,665 | |
3.96%, 11/26/2025(b) | | | 101,000 | | | | 97,396 | |
2.13%, 11/24/2026(b) | | | 100,000 | | | | 90,296 | |
5.88%, 7/8/2031(b) | | | 200,000 | | | | 171,318 | |
3.55%, 9/18/2031(b) | | | 200,000 | | | | 157,079 | |
3.73%, 1/14/2032(b) | | | 350,000 | | | | 253,413 | |
4.88%, 12/1/2032(b) | | | 303,000 | | | | 255,134 | |
3.74%, 1/7/2033(b) | | | 250,000 | | | | 174,840 | |
7.08%, 2/10/2034(b) | | | 400,000 | | | | 352,366 | |
| | |
FactSet Research Systems, Inc. | | | | | | | | |
2.90%, 3/1/2027 | | | 50,000 | | | | 45,163 | |
3.45%, 3/1/2032 | | | 100,000 | | | | 80,877 | |
See Accompanying Notes to the Financial Statements.
| | | | |
388 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Capital Markets – (continued) | |
| | |
Goldman Sachs Group, Inc. (The) | | | | | | | | |
3.50%, 4/1/2025 | | $ | 183,000 | | | $ | 176,126 | |
3.50%, 11/16/2026 | | | 50,000 | | | | 46,371 | |
1.43%, 3/9/2027(b) | | | 151,000 | | | | 134,107 | |
3.62%, 3/15/2028(b) | | | 150,000 | | | | 137,338 | |
2.62%, 4/22/2032(b) | | | 303,000 | | | | 230,855 | |
2.38%, 7/21/2032(b) | | | 101,000 | | | | 74,967 | |
3.10%, 2/24/2033(b) | | | 150,000 | | | | 116,609 | |
| | |
Jefferies Financial Group, Inc. | | | | | | | | |
2.63%, 10/15/2031 | | | 100,000 | | | | 73,726 | |
| | |
Moody's Corp. | | | | | | | | |
3.75%, 3/24/2025 | | | 100,000 | | | | 97,080 | |
3.25%, 1/15/2028 | | | 140,000 | | | | 127,193 | |
4.25%, 2/1/2029 | | | 252,000 | | | | 234,679 | |
| | |
Morgan Stanley | | | | | | | | |
4.00%, 7/23/2025 | | | 50,000 | | | | 48,390 | |
3.88%, 1/27/2026 | | | 252,000 | | | | 240,366 | |
3.13%, 7/27/2026 | | | 251,000 | | | | 232,212 | |
0.99%, 12/10/2026(b) | | | 160,000 | | | | 142,392 | |
5.05%, 1/28/2027(b) | | | 160,000 | | | | 156,259 | |
1.59%, 5/4/2027(b) | | | 312,000 | | | | 277,236 | |
1.51%, 7/20/2027(b) | | | 123,000 | | | | 107,974 | |
3.77%, 1/24/2029(b) | | | 100,000 | | | | 90,193 | |
5.12%, 2/1/2029(b) | | | 160,000 | | | | 152,335 | |
5.16%, 4/20/2029(b) | | | 160,000 | | | | 152,228 | |
4.43%, 1/23/2030(b) | | | 113,000 | | | | 102,889 | |
2.70%, 1/22/2031(b) | | | 250,000 | | | | 200,869 | |
2.24%, 7/21/2032(b) | | | 100,000 | | | | 73,755 | |
2.94%, 1/21/2033(b) | | | 200,000 | | | | 153,480 | |
6.34%, 10/18/2033(b) | | | 153,000 | | | | 149,998 | |
5.25%, 4/21/2034(b) | | | 120,000 | | | | 108,121 | |
5.42%, 7/21/2034(b) | | | 100,000 | | | | 91,268 | |
| | |
Nasdaq, Inc. | | | | | | | | |
1.65%, 1/15/2031 | | | 101,000 | | | | 74,596 | |
| | |
Nomura Holdings, Inc. | | | | | | | | |
1.85%, 7/16/2025 | | | 303,000 | | | | 280,682 | |
2.68%, 7/16/2030 | | | 200,000 | | | | 154,664 | |
| | |
S&P Global, Inc. | | | | | | | | |
2.70%, 3/1/2029 | | | 252,000 | | | | 218,524 | |
4.25%, 5/1/2029 | | | 200,000 | | | | 186,155 | |
2.50%, 12/1/2029 | | | 250,000 | | | | 209,167 | |
1.25%, 8/15/2030 | | | 100,000 | | | | 74,353 | |
2.90%, 3/1/2032 | | | 200,000 | | | | 160,472 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Capital Markets – (continued) | |
| | |
State Street Corp. | | | | | | | | |
5.16%, 5/18/2034(b) | | $ | 200,000 | | | $ | 180,869 | |
| | |
Stifel Financial Corp. | | | | | | | | |
4.00%, 5/15/2030 | | | 101,000 | | | | 84,550 | |
| | | | | | | 12,550,739 | |
|
Chemicals – 0.7% | |
| | |
Celanese US Holdings LLC | | | | | | | | |
6.33%, 7/15/2029 | | | 150,000 | | | | 144,591 | |
| | |
Dow Chemical Co. (The) | | | | | | | | |
7.38%, 11/1/2029 | | | 202,000 | | | | 213,540 | |
| | |
DuPont de Nemours, Inc. | | | | | | | | |
4.49%, 11/15/2025 | | | 500,000 | | | | 487,246 | |
| | |
EIDP, Inc. | | | | | | | | |
4.50%, 5/15/2026 | | | 300,000 | | | | 291,286 | |
4.80%, 5/15/2033 | | | 250,000 | | | | 227,295 | |
| | |
FMC Corp. | | | | | | | | |
3.20%, 10/1/2026 | | | 151,000 | | | | 137,675 | |
| | |
Huntsman International LLC | | | | | | | | |
4.50%, 5/1/2029 | | | 100,000 | | | | 89,443 | |
| | |
NewMarket Corp. | | | | | | | | |
2.70%, 3/18/2031 | | | 100,000 | | | | 76,776 | |
| | |
RPM International, Inc. | | | | | | | | |
4.55%, 3/1/2029 | | | 100,000 | | | | 92,051 | |
| | |
Sherwin-Williams Co. (The) | | | | | | | | |
2.95%, 8/15/2029 | | | 101,000 | | | | 86,073 | |
| | | | | | | 1,845,976 | |
|
Commercial Services & Supplies – 1.0% | |
| | |
Cintas Corp. No. 2 | | | | | | | | |
3.45%, 5/1/2025 | | | 250,000 | | | | 241,947 | |
3.70%, 4/1/2027 | | | 200,000 | | | | 188,512 | |
4.00%, 5/1/2032 | | | 140,000 | | | | 122,252 | |
| | |
RELX Capital, Inc. | | | | | | | | |
4.00%, 3/18/2029 | | | 252,000 | | | | 232,025 | |
3.00%, 5/22/2030 | | | 202,000 | | | | 169,018 | |
4.75%, 5/20/2032 | | | 100,000 | | | | 91,623 | |
| | |
Republic Services, Inc. | | | | | | | | |
2.90%, 7/1/2026 | | | 250,000 | | | | 233,653 | |
3.38%, 11/15/2027 | | | 200,000 | | | | 184,074 | |
3.95%, 5/15/2028 | | | 151,000 | | | | 140,824 | |
4.88%, 4/1/2029 | | | 100,000 | | | | 95,912 | |
2.30%, 3/1/2030 | | | 200,000 | | | | 162,242 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 389 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Commercial Services & Supplies – (continued) | |
| | |
Waste Management, Inc. | | | | | | | | |
0.75%, 11/15/2025 | | $ | 152,000 | | | $ | 138,481 | |
1.15%, 3/15/2028 | | | 162,000 | | | | 135,197 | |
4.88%, 2/15/2029 | | | 150,000 | | | | 144,561 | |
4.63%, 2/15/2030 | | | 151,000 | | | | 141,908 | |
4.15%, 4/15/2032 | | | 250,000 | | | | 221,248 | |
4.63%, 2/15/2033 | | | 150,000 | | | | 136,039 | |
| | | | | | | 2,779,516 | |
|
Communications Equipment – 0.5% | |
| | |
Cisco Systems, Inc. | | | | | | | | |
2.50%, 9/20/2026 | | | 200,000 | | | | 185,713 | |
| | |
Juniper Networks, Inc. | | | | | | | | |
1.20%, 12/10/2025 | | | 50,000 | | | | 45,157 | |
3.75%, 8/15/2029 | | | 151,000 | | | | 132,546 | |
| | |
Motorola Solutions, Inc. | | | | | | | | |
4.60%, 2/23/2028 | | | 201,000 | | | | 190,142 | |
4.60%, 5/23/2029 | | | 303,000 | | | | 282,341 | |
2.30%, 11/15/2030 | | | 252,000 | | | | 192,611 | |
2.75%, 5/24/2031 | | | 200,000 | | | | 155,043 | |
5.60%, 6/1/2032 | | | 150,000 | | | | 140,555 | |
| | |
Nokia OYJ | | | | | | | | |
4.38%, 6/12/2027 | | | 50,000 | | | | 46,260 | |
| | | | | | | 1,370,368 | |
|
Construction Materials – 0.1% | |
| | |
Eagle Materials, Inc. | | | | | | | | |
2.50%, 7/1/2031 | | | 250,000 | | | | 190,607 | |
| | |
Vulcan Materials Co. | | | | | | | | |
3.50%, 6/1/2030 | | | 200,000 | | | | 170,660 | |
| | | | | | | 361,267 | |
|
Consumer Finance – 1.1% | |
| | |
AerCap Ireland Capital DAC | | | | | | | | |
2.45%, 10/29/2026 | | | 200,000 | | | | 177,906 | |
3.00%, 10/29/2028 | | | 200,000 | | | | 168,449 | |
| | |
American Express Co. | | | | | | | | |
2.25%, 3/4/2025 | | | 252,000 | | | | 239,670 | |
4.99%, 5/1/2026(b) | | | 250,000 | | | | 245,204 | |
2.55%, 3/4/2027 | | | 100,000 | | | | 89,535 | |
3.30%, 5/3/2027 | | | 200,000 | | | | 183,043 | |
4.99%, 5/26/2033(b) | | | 76,000 | | | | 67,731 | |
4.42%, 8/3/2033(b) | | | 100,000 | | | | 87,300 | |
5.63%, 7/28/2034(b) | | | 100,000 | | | | 91,139 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Consumer Finance – (continued) | |
| | |
Capital One Financial Corp. | | | | | | | | |
5.82%, 2/1/2034(b) | | $ | 50,000 | | | $ | 43,729 | |
| | |
Caterpillar Financial Services Corp. | | | | | | | | |
3.40%, 5/13/2025 | | | 200,000 | | | | 193,736 | |
| | |
Discover Financial Services | | | | | | | | |
3.95%, 11/6/2024 | | | 250,000 | | | | 243,171 | |
| | |
Synchrony Financial | | | | | | | | |
4.88%, 6/13/2025 | | | 181,000 | | | | 171,658 | |
4.50%, 7/23/2025 | | | 373,000 | | | | 350,402 | |
3.70%, 8/4/2026 | | | 170,000 | | | | 150,792 | |
3.95%, 12/1/2027 | | | 202,000 | | | | 172,912 | |
5.15%, 3/19/2029 | | | 202,000 | | | | 174,472 | |
2.88%, 10/28/2031 | | | 150,000 | | | | 101,648 | |
| | | | | | | 2,952,497 | |
|
Consumer Staples Distribution & Retail – 0.7% | |
| | |
Costco Wholesale Corp. | | | | | | | | |
1.38%, 6/20/2027 | | | 250,000 | | | | 217,587 | |
1.60%, 4/20/2030 | | | 400,000 | | | | 316,211 | |
1.75%, 4/20/2032 | | | 320,000 | | | | 239,497 | |
| | |
Kroger Co. (The) | | | | | | | | |
7.50%, 4/1/2031 | | | 150,000 | | | | 160,882 | |
| | |
Sysco Corp. | | | | | | | | |
3.75%, 10/1/2025 | | | 250,000 | | | | 239,540 | |
3.30%, 7/15/2026 | | | 250,000 | | | | 233,708 | |
2.40%, 2/15/2030 | | | 250,000 | | | | 201,305 | |
5.95%, 4/1/2030 | | | 250,000 | | | | 248,186 | |
| | |
Walmart, Inc. | | | | | | | | |
4.10%, 4/15/2033 | | | 200,000 | | | | 179,031 | |
| | | | | | | 2,035,947 | |
|
Containers & Packaging – 0.4% | |
| | |
Amcor Finance USA, Inc. | | | | | | | | |
3.63%, 4/28/2026 | | | 250,000 | | | | 235,521 | |
4.50%, 5/15/2028 | | | 112,000 | | | | 104,828 | |
| | |
Amcor Flexibles North America, Inc. | | | | | | | | |
2.63%, 6/19/2030 | | | 100,000 | | | | 78,931 | |
2.69%, 5/25/2031 | | | 100,000 | | | | 77,339 | |
| | |
AptarGroup, Inc. | | | | | | | | |
3.60%, 3/15/2032 | | | 100,000 | | | | 81,522 | |
| | |
Avery Dennison Corp. | | | | | | | | |
4.88%, 12/6/2028 | | | 151,000 | | | | 143,855 | |
5.75%, 3/15/2033 | | | 100,000 | | | | 95,377 | |
See Accompanying Notes to the Financial Statements.
| | | | |
390 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Containers & Packaging – (continued) | |
| | |
Packaging Corp. of America | | | | | | | | |
3.00%, 12/15/2029 | | $ | 278,000 | | | $ | 234,591 | |
| | | | | | | 1,051,964 | |
|
Distributors – 0.2% | |
| | |
Genuine Parts Co. | | | | | | | | |
1.75%, 2/1/2025 | | | 251,000 | | | | 237,253 | |
2.75%, 2/1/2032 | | | 200,000 | | | | 150,822 | |
| | |
LKQ Corp. | | | | | | | | |
6.25%, 6/15/2033 | | | 150,000 | | | | 140,075 | |
| | | | | | | 528,150 | |
|
Diversified REITs – 1.2% | |
| | |
Broadstone Net Lease LLC | | | | | | | | |
REIT, 2.60%, 9/15/2031 | | | 50,000 | | | | 34,677 | |
| | |
GLP Capital LP | | | | | | | | |
REIT, 5.25%, 6/1/2025 | | | 200,000 | | | | 195,079 | |
REIT, 5.38%, 4/15/2026 | | | 403,000 | | | | 386,236 | |
REIT, 5.75%, 6/1/2028 | | | 300,000 | | | | 281,263 | |
REIT, 5.30%, 1/15/2029 | | | 150,000 | | | | 137,012 | |
REIT, 4.00%, 1/15/2030 | | | 200,000 | | | | 166,909 | |
REIT, 4.00%, 1/15/2031 | | | 150,000 | | | | 121,994 | |
REIT, 3.25%, 1/15/2032 | | | 250,000 | | | | 189,089 | |
| | |
Rayonier LP | | | | | | | | |
REIT, 2.75%, 5/17/2031 | | | 100,000 | | | | 76,392 | |
| | |
STORE Capital Corp. | | | | | | | | |
REIT, 4.50%, 3/15/2028 | | | 100,000 | | | | 86,279 | |
REIT, 4.63%, 3/15/2029 | | | 141,000 | | | | 118,463 | |
| | |
VICI Properties LP | | | | | | | | |
REIT, 4.38%, 5/15/2025 | | | 50,000 | | | | 48,378 | |
REIT, 4.75%, 2/15/2028 | | | 505,000 | | | | 465,055 | |
REIT, 4.95%, 2/15/2030 | | | 303,000 | | | | 270,118 | |
REIT, 5.13%, 5/15/2032 | | | 450,000 | | | | 388,871 | |
| | |
Vornado Realty LP | | | | | | | | |
REIT, 2.15%, 6/1/2026 | | | 200,000 | | | | 168,502 | |
| | |
WP Carey, Inc. | | | | | | | | |
REIT, 4.00%, 2/1/2025 | | | 151,000 | | | | 146,994 | |
REIT, 3.85%, 7/15/2029 | | | 50,000 | | | | 43,649 | |
REIT, 2.40%, 2/1/2031 | | | 100,000 | | | | 75,840 | |
| | | | | | | 3,400,800 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified Telecommunication Services – 0.1% | |
| | |
Koninklijke KPN NV | | | | | | | | |
8.38%, 10/1/2030 | | $ | 151,000 | | | $ | 165,241 | |
| | |
Sprint Capital Corp. | | | | | | | | |
8.75%, 3/15/2032 | | | 92,000 | | | | 103,560 | |
| | | | | | | 268,801 | |
|
Electric Utilities – 1.2% | |
| | |
American Electric Power Co., Inc. | | | | | | | | |
3.88%, 2/15/2062(b) | | | 101,000 | | | | 79,318 | |
| | |
Arizona Public Service Co. | | | | | | | | |
5.55%, 8/1/2033 | | | 100,000 | | | | 93,944 | |
| | |
Avangrid, Inc. | | | | | | | | |
3.15%, 12/1/2024 | | | 50,000 | | | | 48,312 | |
3.20%, 4/15/2025 | | | 251,000 | | | | 240,219 | |
3.80%, 6/1/2029 | | | 150,000 | | | | 131,843 | |
| | |
Duke Energy Corp. | | | | | | | | |
3.25%, 1/15/2082(b) | | | 101,000 | | | | 72,560 | |
| | |
Georgia Power Co. | | | | | | | | |
4.95%, 5/17/2033 | | | 200,000 | | | | 182,552 | |
| | |
Interstate Power and Light Co. | | | | | | | | |
3.60%, 4/1/2029 | | | 102,000 | | | | 91,515 | |
| | |
MidAmerican Energy Co. | | | | | | | | |
3.65%, 4/15/2029 | | | 303,000 | | | | 273,186 | |
| | |
Nevada Power Co. | | | | | | | | |
Series CC, 3.70%, 5/1/2029 | | | 252,000 | | | | 224,950 | |
| | |
NextEra Energy Capital Holdings, Inc. | | | | | | | | |
4.80%, 12/1/2077(b) | | | 61,000 | | | | 51,118 | |
5.65%, 5/1/2079(b) | | | 97,000 | | | | 85,719 | |
3.80%, 3/15/2082(b) | | | 110,000 | | | | 87,999 | |
| | |
Oklahoma Gas and Electric Co. | | | | | | | | |
3.25%, 4/1/2030 | | | 200,000 | | | | 168,865 | |
| | |
Oncor Electric Delivery Co. LLC | | | | | | | | |
4.55%, 9/15/2032 | | | 100,000 | | | | 89,237 | |
| | |
PacifiCorp | | | | | | | | |
3.50%, 6/15/2029 | | | 250,000 | | | | 218,830 | |
| | |
PPL Capital Funding, Inc. | | | | | | | | |
4.13%, 4/15/2030 | | | 113,000 | | | | 99,932 | |
| | |
PPL Electric Utilities Corp. | | | | | | | | |
5.00%, 5/15/2033 | | | 200,000 | | | | 185,491 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 391 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Electric Utilities – (continued) | |
| | |
Sierra Pacific Power Co. | | | | | | | | |
2.60%, 5/1/2026 | | $ | 20,000 | | | $ | 18,582 | |
| | |
Southern Co. (The) | | | | | | | | |
Series B, 4.00%, 1/15/2051(b) | | | 142,000 | | | | 129,559 | |
Series 21-A, 3.75%, 9/15/2051(b) | | | 300,000 | | | | 256,527 | |
| | |
Wisconsin Electric Power Co. | | | | | | | | |
5.63%, 5/15/2033 | | | 200,000 | | | | 195,821 | |
| | |
Wisconsin Power and Light Co. | | | | | | | | |
1.95%, 9/16/2031 | | | 50,000 | | | | 37,092 | |
4.95%, 4/1/2033 | | | 150,000 | | | | 137,340 | |
| | |
Xcel Energy, Inc. | | | | | | | | |
1.75%, 3/15/2027 | | | 50,000 | | | | 43,581 | |
3.40%, 6/1/2030 | | | 50,000 | | | | 42,346 | |
2.35%, 11/15/2031 | | | 100,000 | | | | 74,396 | |
| | | | | | | 3,360,834 | |
|
Electrical Equipment – 0.2% | |
| | |
Acuity Brands Lighting, Inc. | | | | | | | | |
2.15%, 12/15/2030 | | | 50,000 | | | | 37,827 | |
| | |
Emerson Electric Co. | | | | | | | | |
2.00%, 12/21/2028 | | | 101,000 | | | | 85,580 | |
| | |
Hubbell, Inc. | | | | | | | | |
3.35%, 3/1/2026 | | | 151,000 | | | | 143,059 | |
3.50%, 2/15/2028 | | | 200,000 | | | | 183,759 | |
| | |
Regal Rexnord Corp. | | | | | | | | |
6.30%, 2/15/2030(c) | | | 50,000 | | | | 47,049 | |
| | | | | | | 497,274 | |
|
Electronic Equipment, Instruments & Components – 1.9% | |
| | |
Amphenol Corp. | | | | | | | | |
4.75%, 3/30/2026 | | | 250,000 | | | | 244,241 | |
4.35%, 6/1/2029 | | | 243,000 | | | | 226,885 | |
2.80%, 2/15/2030 | | | 211,000 | | | | 175,474 | |
2.20%, 9/15/2031 | | | 250,000 | | | | 190,865 | |
| | |
Avnet, Inc. | | | | | | | | |
4.63%, 4/15/2026 | | | 176,000 | | | | 168,692 | |
| | |
CDW LLC | | | | | | | | |
5.50%, 12/1/2024 | | | 270,000 | | | | 267,208 | |
4.13%, 5/1/2025 | | | 250,000 | | | | 241,213 | |
2.67%, 12/1/2026 | | | 404,000 | | | | 361,374 | |
4.25%, 4/1/2028 | | | 202,000 | | | | 183,622 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Electronic Equipment, Instruments & Components – (continued) | |
3.28%, 12/1/2028 | | $ | 202,000 | | | $ | 172,577 | |
3.25%, 2/15/2029 | | | 200,000 | | | | 168,852 | |
3.57%, 12/1/2031 | | | 200,000 | | | | 160,372 | |
| | |
Flex Ltd. | | | | | | | | |
3.75%, 2/1/2026 | | | 250,000 | | | | 236,695 | |
6.00%, 1/15/2028 | | | 130,000 | | | | 128,685 | |
4.88%, 6/15/2029 | | | 100,000 | | | | 91,443 | |
4.88%, 5/12/2030 | | | 62,000 | | | | 56,268 | |
| | |
Jabil, Inc. | | | | | | | | |
1.70%, 4/15/2026 | | | 150,000 | | | | 135,200 | |
4.25%, 5/15/2027 | | | 100,000 | | | | 93,841 | |
3.60%, 1/15/2030 | | | 200,000 | | | | 169,872 | |
| | |
Keysight Technologies, Inc. | | | | | | | | |
4.60%, 4/6/2027 | | | 350,000 | | | | 333,805 | |
| | |
TD SYNNEX Corp. | | | | | | | | |
2.38%, 8/9/2028 | | | 202,000 | | | | 165,804 | |
2.65%, 8/9/2031 | | | 100,000 | | | | 72,949 | |
| | |
Teledyne Technologies, Inc. | | | | | | | | |
2.25%, 4/1/2028 | | | 157,000 | | | | 134,040 | |
2.75%, 4/1/2031 | | | 200,000 | | | | 157,755 | |
| | |
Trimble, Inc. | | | | | | | | |
4.90%, 6/15/2028 | | | 200,000 | | | | 189,313 | |
6.10%, 3/15/2033 | | | 50,000 | | | | 47,727 | |
| | |
Tyco Electronics Group SA | | | | | | | | |
4.50%, 2/13/2026 | | | 100,000 | | | | 97,622 | |
3.70%, 2/15/2026 | | | 81,000 | | | | 77,506 | |
2.50%, 2/4/2032 | | | 250,000 | | | | 195,821 | |
| | |
Vontier Corp. | | | | | | | | |
2.40%, 4/1/2028 | | | 252,000 | | | | 207,660 | |
2.95%, 4/1/2031 | | | 100,000 | | | | 75,286 | |
| | | | | | | 5,228,667 | |
|
Energy Equipment & Services – 0.1% | |
| | |
Baker Hughes Holdings LLC | | | | | | | | |
3.14%, 11/7/2029 | | | 152,000 | | | | 129,855 | |
| | |
Helmerich & Payne, Inc. | | | | | | | | |
2.90%, 9/29/2031 | | | 100,000 | | | | 76,810 | |
| | |
Schlumberger Investment SA | | | | | | | | |
4.85%, 5/15/2033 | | | 100,000 | | | | 92,032 | |
| | | | | | | 298,697 | |
See Accompanying Notes to the Financial Statements.
| | | | |
392 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Entertainment – 0.5% | |
| | |
Activision Blizzard, Inc. | | | | | | | | |
3.40%, 9/15/2026 | | $ | 50,000 | | | $ | 47,284 | |
3.40%, 6/15/2027 | | | 152,000 | | | | 141,520 | |
1.35%, 9/15/2030 | | | 200,000 | | | | 153,375 | |
| | |
Electronic Arts, Inc. | | | | | | | | |
4.80%, 3/1/2026 | | | 50,000 | | | | 49,064 | |
1.85%, 2/15/2031 | | | 250,000 | | | | 190,257 | |
| | |
Netflix, Inc. | | | | | | | | |
4.88%, 4/15/2028 | | | 250,000 | | | | 240,859 | |
5.88%, 11/15/2028 | | | 300,000 | | | | 300,112 | |
6.38%, 5/15/2029 | | | 250,000 | | | | 256,773 | |
| | | | | | | 1,379,244 | |
|
Financial Services – 3.0% | |
| | |
Block Financial LLC | | | | | | | | |
2.50%, 7/15/2028 | | | 353,000 | | | | 297,734 | |
3.88%, 8/15/2030 | | | 150,000 | | | | 127,404 | |
| | |
Corebridge Financial, Inc. | | | | | | | | |
3.50%, 4/4/2025 | | | 140,000 | | | | 134,603 | |
3.65%, 4/5/2027 | | | 150,000 | | | | 137,372 | |
3.90%, 4/5/2032 | | | 100,000 | | | | 81,802 | |
6.88%, 12/15/2052(b) | | | 250,000 | | | | 230,966 | |
| | |
Fidelity National Information Services, Inc. | | | | | | | | |
1.65%, 3/1/2028 | | | 200,000 | | | | 167,441 | |
| | |
Fiserv, Inc. | | | | | | | | |
3.85%, 6/1/2025 | | | 350,000 | | | | 339,202 | |
3.20%, 7/1/2026 | | | 650,000 | | | | 607,272 | |
2.25%, 6/1/2027 | | | 250,000 | | | | 220,911 | |
4.20%, 10/1/2028 | | | 301,000 | | | | 277,824 | |
3.50%, 7/1/2029 | | | 1,111,000 | | | | 974,579 | |
2.65%, 6/1/2030 | | | 200,000 | | | | 161,171 | |
5.60%, 3/2/2033 | | | 250,000 | | | | 235,246 | |
5.63%, 8/21/2033 | | | 300,000 | | | | 281,397 | |
| | |
Global Payments, Inc. | | | | | | | | |
5.30%, 8/15/2029 | | | 100,000 | | | | 93,928 | |
| | |
Mastercard, Inc. | | | | | | | | |
2.00%, 3/3/2025 | | | 101,000 | | | | 96,529 | |
2.95%, 11/21/2026 | | | 50,000 | | | | 46,630 | |
3.30%, 3/26/2027 | | | 353,000 | | | | 329,634 | |
2.95%, 6/1/2029 | | | 401,000 | | | | 351,791 | |
3.35%, 3/26/2030 | | | 353,000 | | | | 310,150 | |
1.90%, 3/15/2031 | | | 250,000 | | | | 194,065 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Financial Services – (continued) | |
2.00%, 11/18/2031 | | $ | 100,000 | | | $ | 76,303 | |
4.85%, 3/9/2033 | | | 200,000 | | | | 188,142 | |
| | |
Radian Group, Inc. | | | | | | | | |
6.63%, 3/15/2025 | | | 101,000 | | | | 99,990 | |
4.88%, 3/15/2027 | | | 143,000 | | | | 132,713 | |
| | |
Synchrony Bank | | | | | | | | |
5.40%, 8/22/2025 | | | 312,000 | | | | 297,959 | |
5.63%, 8/23/2027 | | | 404,000 | | | | 369,154 | |
| | |
Visa, Inc. | | | | | | | | |
3.15%, 12/14/2025 | | | 432,000 | | | | 412,209 | |
1.90%, 4/15/2027 | | | 217,000 | | | | 193,231 | |
2.75%, 9/15/2027 | | | 120,000 | | | | 108,988 | |
2.05%, 4/15/2030 | �� | | 200,000 | | | | 161,792 | |
1.10%, 2/15/2031 | | | 250,000 | | | | 185,193 | |
| | |
Voya Financial, Inc. | | | | | | | | |
4.70%, 1/23/2048(b) | | | 101,000 | | | | 79,234 | |
| | |
Western Union Co. (The) | | | | | | | | |
2.85%, 1/10/2025 | | | 243,000 | | | | 233,094 | |
2.75%, 3/15/2031 | | | 150,000 | | | | 113,979 | |
| | | | | | | 8,349,632 | |
|
Food Products – 1.7% | |
| | |
Campbell Soup Co. | | | | | | | | |
4.15%, 3/15/2028 | | | 131,000 | | | | 122,040 | |
| | |
Conagra Brands, Inc. | | | | | | | | |
4.85%, 11/1/2028 | | | 100,000 | | | | 93,960 | |
| | |
Flowers Foods, Inc. | | | | | | | | |
3.50%, 10/1/2026 | | | 100,000 | | | | 93,324 | |
| | |
General Mills, Inc. | | | | | | | | |
4.00%, 4/17/2025 | | | 250,000 | | | | 243,294 | |
4.20%, 4/17/2028 | | | 142,000 | | | | 133,078 | |
2.88%, 4/15/2030 | | | 152,000 | | | | 125,650 | |
4.95%, 3/29/2033 | | | 150,000 | | | | 136,228 | |
| | |
Hershey Co. (The) | | | | | | | | |
0.90%, 6/1/2025 | | | 266,000 | | | | 247,456 | |
4.25%, 5/4/2028 | | | 200,000 | | | | 191,955 | |
| | |
Hormel Foods Corp. | | | | | | | | |
1.70%, 6/3/2028 | | | 291,000 | | | | 246,804 | |
| | |
Ingredion, Inc. | | | | | | | | |
2.90%, 6/1/2030 | | | 200,000 | | | | 164,216 | |
| | |
J M Smucker Co. (The) | | | | | | | | |
3.50%, 3/15/2025 | | | 230,000 | | | | 222,621 | |
2.38%, 3/15/2030 | | | 250,000 | | | | 199,870 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 393 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Food Products – (continued) | |
| | |
Kellogg Co. | | | | | | | | |
4.30%, 5/15/2028 | | $ | 250,000 | | | $ | 233,539 | |
Series B, 7.45%, 4/1/2031 | | | 122,000 | | | | 129,365 | |
| | |
Mead Johnson Nutrition Co. | | | | | | | | |
4.13%, 11/15/2025 | | | 250,000 | | | | 242,373 | |
| | |
Mondelez International, Inc. | | | | | | | | |
1.50%, 5/4/2025 | | | 250,000 | | | | 234,122 | |
2.63%, 3/17/2027 | | | 202,000 | | | | 182,794 | |
2.75%, 4/13/2030 | | | 93,000 | | | | 76,586 | |
1.50%, 2/4/2031 | | | 100,000 | | | | 73,391 | |
| | |
Unilever Capital Corp. | | | | | | | | |
3.10%, 7/30/2025 | | | 250,000 | | | | 240,292 | |
2.90%, 5/5/2027 | | | 151,000 | | | | 138,806 | |
3.50%, 3/22/2028 | | | 152,000 | | | | 140,406 | |
4.88%, 9/8/2028 | | | 200,000 | | | | 195,358 | |
2.13%, 9/6/2029 | | | 225,000 | | | | 187,377 | |
5.90%, 11/15/2032 | | | 250,000 | | | | 253,183 | |
| | | | | | | 4,548,088 | |
|
Gas Utilities – 0.4% | |
| | |
Atmos Energy Corp. | | | | | | | | |
2.63%, 9/15/2029 | | | 200,000 | | | | 170,727 | |
| | |
CenterPoint Energy Resources Corp. | | | | | | | | |
5.40%, 3/1/2033 | | | 150,000 | | | | 140,060 | |
| | |
Eastern Energy Gas Holdings LLC | | | | | | | | |
Series A, 2.50%, 11/15/2024 | | | 50,000 | | | | 48,205 | |
3.60%, 12/15/2024 | | | 55,000 | | | | 53,486 | |
| | |
National Fuel Gas Co. | | | | | | | | |
5.20%, 7/15/2025 | | | 91,000 | | | | 89,418 | |
5.50%, 1/15/2026 | | | 233,000 | | | | 228,526 | |
4.75%, 9/1/2028 | | | 251,000 | | | | 232,045 | |
2.95%, 3/1/2031 | | | 100,000 | | | | 76,016 | |
| | |
Southern California Gas Co. | | | | | | | | |
Series XX, 2.55%, 2/1/2030 | | | 30,000 | | | | 24,413 | |
5.20%, 6/1/2033 | | | 100,000 | | | | 92,389 | |
| | | | | | | 1,155,285 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Ground Transportation – 0.4% | |
| | |
Burlington Northern Santa Fe LLC | | | | | | | | |
3.65%, 9/1/2025 | | $ | 250,000 | | | $ | 242,115 | |
| | |
Canadian National Railway Co. | | | | | | | | |
2.75%, 3/1/2026 | | | 251,000 | | | | 235,713 | |
3.85%, 8/5/2032 | | | 200,000 | | | | 173,123 | |
| | |
CSX Corp. | | | | | | | | |
3.25%, 6/1/2027 | | | 80,000 | | | | 73,651 | |
3.80%, 3/1/2028 | | | 161,000 | | | | 149,531 | |
4.25%, 3/15/2029 | | | 172,000 | | | | 160,505 | |
| | |
Triton Container International Ltd. | | | | | | | | |
3.25%, 3/15/2032 | | | 100,000 | | | | 72,334 | |
| | | | | | | 1,106,972 | |
|
Health Care Equipment & Supplies – 0.7% | |
| | |
Boston Scientific Corp. | | | | | | | | |
1.90%, 6/1/2025 | | | 250,000 | | | | 235,177 | |
2.65%, 6/1/2030 | | | 250,000 | | | | 205,627 | |
| | |
DH Europe Finance II Sarl | | | | | | | | |
2.20%, 11/15/2024 | | | 252,000 | | | | 242,871 | |
2.60%, 11/15/2029 | | | 152,000 | | | | 128,647 | |
| | |
Edwards Lifesciences Corp. | | | | | | | | |
4.30%, 6/15/2028 | | | 150,000 | | | | 140,545 | |
| | |
Smith & Nephew plc | | | | | | | | |
2.03%, 10/14/2030 | | | 250,000 | | | | 188,073 | |
| | |
Stryker Corp. | | | | | | | | |
1.15%, 6/15/2025 | | | 402,000 | | | | 373,693 | |
3.38%, 11/1/2025 | | | 200,000 | | | | 191,501 | |
1.95%, 6/15/2030 | | | 50,000 | | | | 39,103 | |
| | |
Zimmer Biomet Holdings, Inc. | | | | | | | | |
3.55%, 4/1/2025 | | | 300,000 | | | | 289,822 | |
| | | | | | | 2,035,059 | |
|
Health Care Providers & Services – 2.3% | |
| | |
Cardinal Health, Inc. | | | | | | | | |
3.75%, 9/15/2025 | | | 250,000 | | | | 239,868 | |
3.41%, 6/15/2027 | | | 304,000 | | | | 278,521 | |
| | |
Cencora, Inc. | | | | | | | | |
3.25%, 3/1/2025 | | | 250,000 | | | | 241,964 | |
3.45%, 12/15/2027 | | | 111,000 | | | | 102,255 | |
2.80%, 5/15/2030 | | | 300,000 | | | | 246,626 | |
2.70%, 3/15/2031 | | | 200,000 | | | | 158,482 | |
See Accompanying Notes to the Financial Statements.
| | | | |
394 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Health Care Providers & Services – (continued) | |
| | |
Centene Corp. | | | | | | | | |
4.63%, 12/15/2029 | | $ | 252,000 | | | $ | 225,102 | |
2.50%, 3/1/2031 | | | 100,000 | | | | 75,649 | |
| | |
Elevance Health, Inc. | | | | | | | | |
2.38%, 1/15/2025 | | | 150,000 | | | | 143,926 | |
2.88%, 9/15/2029 | | | 200,000 | | | | 169,912 | |
| | |
HCA, Inc. | | | | | | | | |
5.38%, 2/1/2025 | | | 200,000 | | | | 197,878 | |
4.13%, 6/15/2029 | | | 150,000 | | | | 133,136 | |
| | |
Humana, Inc. | | | | | | | | |
1.35%, 2/3/2027 | | | 200,000 | | | | 173,381 | |
5.75%, 3/1/2028 | | | 50,000 | | | | 49,807 | |
3.70%, 3/23/2029 | | | 202,000 | | | | 182,696 | |
4.88%, 4/1/2030 | | | 50,000 | | | | 46,581 | |
| | |
Laboratory Corp. of America Holdings | | | | | | | | |
2.30%, 12/1/2024 | | | 150,000 | | | | 144,116 | |
3.60%, 2/1/2025 | | | 50,000 | | | | 48,553 | |
1.55%, 6/1/2026 | | | 252,000 | | | | 225,634 | |
2.95%, 12/1/2029 | | | 200,000 | | | | 168,786 | |
| | |
McKesson Corp. | | | | | | | | |
5.25%, 2/15/2026 | | | 250,000 | | | | 247,184 | |
1.30%, 8/15/2026 | | | 252,000 | | | | 223,686 | |
5.10%, 7/15/2033 | | | 300,000 | | | | 278,919 | |
| | |
Quest Diagnostics, Inc. | | | | | | | | |
3.50%, 3/30/2025 | | | 200,000 | | | | 192,965 | |
4.20%, 6/30/2029 | | | 200,000 | | | | 183,970 | |
2.95%, 6/30/2030 | | | 102,000 | | | | 83,755 | |
| | |
UnitedHealth Group, Inc. | | | | | | | | |
2.95%, 10/15/2027 | | | 342,000 | | | | 311,224 | |
4.25%, 1/15/2029 | | | 160,000 | | | | 150,420 | |
4.00%, 5/15/2029 | | | 110,000 | | | | 101,780 | |
2.88%, 8/15/2029 | | | 112,000 | | | | 97,151 | |
5.30%, 2/15/2030 | | | 110,000 | | | | 107,980 | |
2.00%, 5/15/2030 | | | 250,000 | | | | 198,654 | |
2.30%, 5/15/2031 | | | 250,000 | | | | 196,714 | |
4.20%, 5/15/2032 | | | 200,000 | | | | 177,324 | |
5.35%, 2/15/2033 | | | 231,000 | | | | 222,031 | |
4.50%, 4/15/2033 | | | 200,000 | | | | 180,081 | |
| | | | | | | 6,206,711 | |
|
Health Care REITs – 0.5% | |
| | |
National Health Investors, Inc. | | | | | | | | |
REIT, 3.00%, 2/1/2031 | | | 100,000 | | | | 72,102 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Health Care REITs – (continued) | |
| | |
Omega Healthcare Investors, Inc. | | | | | | | | |
REIT, 5.25%, 1/15/2026 | | $ | 250,000 | | | $ | 241,565 | |
REIT, 4.50%, 4/1/2027 | | | 101,000 | | | | 93,017 | |
REIT, 4.75%, 1/15/2028 | | | 301,000 | | | | 274,535 | |
REIT, 3.63%, 10/1/2029 | | | 151,000 | | | | 123,016 | |
REIT, 3.38%, 2/1/2031 | | | 150,000 | | | | 115,319 | |
REIT, 3.25%, 4/15/2033 | | | 150,000 | | | | 106,910 | |
| | |
Physicians Realty LP | | | | | | | | |
REIT, 4.30%, 3/15/2027 | | | 151,000 | | | | 140,205 | |
| | |
Sabra Health Care LP | | | | | | | | |
REIT, 5.13%, 8/15/2026 | | | 202,000 | | | | 191,540 | |
REIT, 3.90%, 10/15/2029 | | | 151,000 | | | | 124,329 | |
| | | | | | | 1,482,538 | |
|
Health Care Technology – 0.1% | |
| | |
IQVIA, Inc. | | | | | | | | |
5.70%, 5/15/2028(c) | | | 200,000 | | | | 192,000 | |
|
Hotel & Resort REITs – 0.2% | |
| | |
Host Hotels & Resorts LP | | | | | | | | |
Series E, REIT, 4.00%, 6/15/2025 | | | 100,000 | | | | 95,977 | |
Series H, REIT, 3.38%, 12/15/2029 | | | 303,000 | | | | 249,677 | |
Series I, REIT, 3.50%, 9/15/2030 | | | 150,000 | | | | 121,252 | |
Series J, REIT, 2.90%, 12/15/2031 | | | 150,000 | | | | 111,970 | |
| | | | | | | 578,876 | |
|
Hotels, Restaurants & Leisure – 1.9% | |
| | |
Choice Hotels International, Inc. | | | | | | | | |
3.70%, 12/1/2029 | | | 100,000 | | | | 81,899 | |
3.70%, 1/15/2031 | | | 100,000 | | | | 78,652 | |
| | |
Marriott International, Inc. | | | | | | | | |
Series EE, 5.75%, 5/1/2025 | | | 282,000 | | | | 281,123 | |
Series R, 3.13%, 6/15/2026 | | | 390,000 | | | | 363,979 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 395 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
5.00%, 10/15/2027 | | $ | 303,000 | | | $ | 292,693 | |
Series X, 4.00%, 4/15/2028 | | | 352,000 | | | | 323,454 | |
5.55%, 10/15/2028 | | | 200,000 | | | | 194,899 | |
4.90%, 4/15/2029 | | | 252,000 | | | | 236,355 | |
Series FF, 4.63%, 6/15/2030 | | | 302,000 | | | | 272,476 | |
Series HH, 2.85%, 4/15/2031 | | | 300,000 | | | | 235,752 | |
Series GG, 3.50%, 10/15/2032 | | | 200,000 | | | | 158,780 | |
| | |
McDonald's Corp. | | | | | | | | |
3.30%, 7/1/2025 | | | 250,000 | | | | 240,696 | |
3.70%, 1/30/2026 | | | 700,000 | | | | 672,885 | |
3.50%, 3/1/2027 | | | 160,000 | | | | 149,522 | |
3.50%, 7/1/2027 | | | 334,000 | | | | 310,323 | |
3.80%, 4/1/2028 | | | 281,000 | | | | 260,705 | |
2.63%, 9/1/2029 | | | 340,000 | | | | 289,534 | |
2.13%, 3/1/2030 | | | 201,000 | | | | 161,561 | |
3.60%, 7/1/2030 | | | 400,000 | | | | 350,330 | |
4.60%, 9/9/2032 | | | 130,000 | | | | 119,296 | |
4.95%, 8/14/2033 | | | 250,000 | | | | 231,931 | |
| | | | | | | 5,306,845 | |
|
Household Durables – 0.6% | |
| | |
DR Horton, Inc. | | | | | | | | |
2.60%, 10/15/2025 | | | 30,000 | | | | 28,135 | |
1.30%, 10/15/2026 | | | 300,000 | | | | 263,091 | |
| | |
Lennar Corp. | | | | | | | | |
4.75%, 5/30/2025 | | | 50,000 | | | | 48,952 | |
5.25%, 6/1/2026 | | | 200,000 | | | | 196,515 | |
4.75%, 11/29/2027 | | | 250,000 | | | | 237,856 | |
| | |
NVR, Inc. | | | | | | | | |
3.00%, 5/15/2030 | | | 327,000 | | | | 268,385 | |
| | |
PulteGroup, Inc. | | | | | | | | |
5.50%, 3/1/2026 | | | 216,000 | | | | 213,345 | |
5.00%, 1/15/2027 | | | 101,000 | | | | 98,152 | |
6.38%, 5/15/2033 | | | 150,000 | | | | 145,864 | |
| | |
Toll Brothers Finance Corp. | | | | | | | | |
4.88%, 3/15/2027 | | | 303,000 | | | | 288,660 | |
| | | | | | | 1,788,955 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Household Products – 0.6% | |
| | |
Church & Dwight Co., Inc. | | | | | | | | |
2.30%, 12/15/2031 | | $ | 100,000 | | | $ | 77,454 | |
5.60%, 11/15/2032 | | | 100,000 | | | | 97,847 | |
| | |
Clorox Co. (The) | | | | | | | | |
3.90%, 5/15/2028 | | | 200,000 | | | | 183,984 | |
1.80%, 5/15/2030 | | | 200,000 | | | | 153,853 | |
| | |
Kimberly-Clark Corp. | | | | | | | | |
3.20%, 4/25/2029 | | | 250,000 | | | | 223,809 | |
3.10%, 3/26/2030 | | | 252,000 | | | | 217,330 | |
| | |
Procter & Gamble Co. (The) | | | | | | | | |
0.55%, 10/29/2025 | | | 250,000 | | | | 228,074 | |
2.45%, 11/3/2026 | | | 162,000 | | | | 150,023 | |
2.80%, 3/25/2027 | | | 66,000 | | | | 60,918 | |
3.00%, 3/25/2030 | | | 264,000 | | | | 229,755 | |
| | | | | | | 1,623,047 | |
|
Independent Power and Renewable Electricity Producers – 0.2% | |
| | |
Constellation Energy Generation LLC | | | | | | | | |
3.25%, 6/1/2025 | | | 250,000 | | | | 239,229 | |
5.60%, 3/1/2028 | | | 100,000 | | | | 98,171 | |
5.80%, 3/1/2033 | | | 100,000 | | | | 94,840 | |
| | | | | | | 432,240 | |
|
Industrial Conglomerates – 0.6% | |
| | |
GE Capital International Funding Co. Unlimited Co. | | | | | | | | |
3.37%, 11/15/2025 | | | 200,000 | | | | 190,261 | |
| | |
Honeywell International, Inc. | | | | | | | | |
1.35%, 6/1/2025 | | | 200,000 | | | | 187,864 | |
2.50%, 11/1/2026 | | | 252,000 | | | | 233,059 | |
1.10%, 3/1/2027 | | | 50,000 | | | | 43,645 | |
4.25%, 1/15/2029 | | | 101,000 | | | | 95,261 | |
2.70%, 8/15/2029 | | | 300,000 | | | | 257,873 | |
1.75%, 9/1/2031 | | | 250,000 | | | | 187,169 | |
5.00%, 2/15/2033 | | | 260,000 | | | | 245,632 | |
| | |
Pentair Finance Sarl | | | | | | | | |
4.50%, 7/1/2029 | | | 100,000 | | | | 90,471 | |
| | | | | | | 1,531,235 | |
|
Insurance – 4.1% | |
| | |
Aflac, Inc. | | | | | | | | |
1.13%, 3/15/2026 | | | 250,000 | | | | 224,472 | |
3.60%, 4/1/2030 | | | 302,000 | | | | 263,072 | |
See Accompanying Notes to the Financial Statements.
| | | | |
396 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Insurance – (continued) | |
| | |
Allied World Assurance Co. Holdings Ltd. | | | | | | | | |
4.35%, 10/29/2025 | | $ | 300,000 | | | $ | 287,800 | |
| | |
American International Group, Inc. | | | | | | | | |
Series A-9, 5.75%, 4/1/2048(b) | | | 202,000 | | | | 183,810 | |
| | |
Aon Corp. | | | | | | | | |
8.21%, 1/1/2027 | | | 80,000 | | | | 83,903 | |
2.85%, 5/28/2027 | | | 363,000 | | | | 328,277 | |
4.50%, 12/15/2028 | | | 120,000 | | | | 112,346 | |
3.75%, 5/2/2029 | | | 310,000 | | | | 277,159 | |
2.80%, 5/15/2030 | | | 237,000 | | | | 193,394 | |
2.05%, 8/23/2031 | | | 50,000 | | | | 37,014 | |
2.60%, 12/2/2031 | | | 160,000 | | | | 122,551 | |
5.35%, 2/28/2033 | | | 350,000 | | | | 326,197 | |
| | |
Aon Global Ltd. | | | | | | | | |
3.88%, 12/15/2025 | | | 101,000 | | | | 96,745 | |
| | |
Arthur J Gallagher & Co. | | | | | | | | |
5.50%, 3/2/2033 | | | 200,000 | | | | 186,298 | |
| | |
Assurant, Inc. | | | | | | | | |
3.70%, 2/22/2030 | | | 101,000 | | | | 83,706 | |
2.65%, 1/15/2032 | | | 100,000 | | | | 72,051 | |
| | |
Athene Holding Ltd. | | | | | | | | |
4.13%, 1/12/2028 | | | 500,000 | | | | 452,331 | |
3.50%, 1/15/2031 | | | 100,000 | | | | 79,862 | |
6.65%, 2/1/2033 | | | 100,000 | | | | 96,368 | |
| | |
AXIS Specialty Finance LLC | | | | | | | | |
4.90%, 1/15/2040(b) | | | 202,000 | | | | 158,912 | |
| | |
Berkshire Hathaway Finance Corp. | | | | | | | | |
2.88%, 3/15/2032 | | | 100,000 | | | | 81,518 | |
| | |
Brown & Brown, Inc. | | | | | | | | |
4.50%, 3/15/2029 | | | 200,000 | | | | 182,876 | |
2.38%, 3/15/2031 | | | 252,000 | | | | 189,012 | |
4.20%, 3/17/2032 | | | 100,000 | | | | 83,822 | |
| | |
Chubb INA Holdings, Inc. | | | | | | | | |
3.15%, 3/15/2025 | | | 50,000 | | | | 48,250 | |
3.35%, 5/3/2026 | | | 200,000 | | | | 189,407 | |
| | |
CNA Financial Corp. | | | | | | | | |
4.50%, 3/1/2026 | | | 100,000 | | | | 96,714 | |
3.90%, 5/1/2029 | | | 150,000 | | | | 134,190 | |
5.50%, 6/15/2033 | | | 100,000 | | | | 91,749 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Insurance – (continued) | |
| | |
CNO Financial Group, Inc. | | | | | | | | |
5.25%, 5/30/2029 | | $ | 100,000 | | | $ | 92,275 | |
| | |
Enstar Finance LLC | | | | | | | | |
5.75%, 9/1/2040(b) | | | 100,000 | | | | 87,983 | |
5.50%, 1/15/2042(b) | | | 100,000 | | | | 79,709 | |
| | |
Enstar Group Ltd. | | | | | | | | |
4.95%, 6/1/2029 | | | 202,000 | | | | 184,265 | |
3.10%, 9/1/2031 | | | 100,000 | | | | 73,926 | |
| | |
Fairfax Financial Holdings Ltd. | | | | | | | | |
4.85%, 4/17/2028 | | | 252,000 | | | | 237,805 | |
4.63%, 4/29/2030 | | | 200,000 | | | | 177,533 | |
5.63%, 8/16/2032 | | | 150,000 | | | | 138,590 | |
| | |
Fidelity National Financial, Inc. | | | | | | | | |
3.40%, 6/15/2030 | | | 150,000 | | | | 123,485 | |
| | |
First American Financial Corp. | | | | | | | | |
4.60%, 11/15/2024 | | | 202,000 | | | | 199,100 | |
4.00%, 5/15/2030 | | | 100,000 | | | | 83,404 | |
2.40%, 8/15/2031 | | | 100,000 | | | | 72,231 | |
| | |
Globe Life, Inc. | | | | | | | | |
4.55%, 9/15/2028 | | | 101,000 | | | | 94,633 | |
2.15%, 8/15/2030 | | | 250,000 | | | | 190,824 | |
4.80%, 6/15/2032 | | | 100,000 | | | | 89,681 | |
| | |
Hanover Insurance Group, Inc. (The) | | | | | | | | |
2.50%, 9/1/2030 | | | 100,000 | | | | 75,108 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | | | | | | |
2.80%, 8/19/2029 | | | 202,000 | | | | 170,898 | |
| | |
Manulife Financial Corp. | | | | | | | | |
4.15%, 3/4/2026 | | | 202,000 | | | | 194,333 | |
2.48%, 5/19/2027 | | | 2,000 | | | | 1,784 | |
4.06%, 2/24/2032(b) | | | 251,000 | | | | 226,518 | |
| | |
Markel Group, Inc. | | | | | | | | |
3.35%, 9/17/2029 | | | 200,000 | | | | 173,940 | |
| | |
Marsh & McLennan Cos., Inc. | | | | | | | | |
3.50%, 3/10/2025 | | | 76,000 | | | | 73,669 | |
4.38%, 3/15/2029 | | | 505,000 | | | | 472,429 | |
2.25%, 11/15/2030 | | | 116,000 | | | | 91,244 | |
5.75%, 11/1/2032 | | | 250,000 | | | | 243,748 | |
5.40%, 9/15/2033 | | | 150,000 | | | | 142,573 | |
| | |
Old Republic International Corp. | | | | | | | | |
3.88%, 8/26/2026 | | | 101,000 | | | | 95,098 | |
| | |
Primerica, Inc. | | | | | | | | |
2.80%, 11/19/2031 | | | 150,000 | | | | 115,659 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 397 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Insurance – (continued) | |
| | |
Principal Financial Group, Inc. | | | | | | | | |
3.70%, 5/15/2029 | | $ | 200,000 | | | $ | 177,697 | |
5.38%, 3/15/2033 | | | 100,000 | | | | 93,446 | |
| | |
Progressive Corp. (The) | | | | | | | | |
3.20%, 3/26/2030 | | | 101,000 | | | | 86,060 | |
4.95%, 6/15/2033 | | | 100,000 | | | | 92,218 | |
| | |
Prudential Financial, Inc. | | | | | | | | |
5.38%, 5/15/2045(b) | �� | | 172,000 | | | | 163,494 | |
4.50%, 9/15/2047(b) | | | 200,000 | | | | 175,283 | |
3.70%, 10/1/2050(b) | | | 71,000 | | | | 55,938 | |
6.00%, 9/1/2052(b) | | | 70,000 | | | | 62,619 | |
| | |
Reinsurance Group of America, Inc. | | | | | | | | |
3.90%, 5/15/2029 | | | 202,000 | | | | 178,218 | |
| | |
RenaissanceRe Holdings Ltd. | | | | | | | | |
3.60%, 4/15/2029 | | | 200,000 | | | | 174,376 | |
| | |
Trinity Acquisition plc | | | | | | | | |
4.40%, 3/15/2026 | | | 151,000 | | | | 144,841 | |
| | |
Unum Group | | | | | | | | |
3.88%, 11/5/2025 | | | 200,000 | | | | 190,635 | |
| | |
Willis North America, Inc. | | | | | | | | |
4.65%, 6/15/2027 | | | 231,000 | | | | 219,855 | |
4.50%, 9/15/2028 | | | 110,000 | | | | 102,252 | |
2.95%, 9/15/2029 | | | 354,000 | | | | 296,804 | |
5.35%, 5/15/2033 | | | 240,000 | | | | 218,725 | |
| | | | | | | 11,198,712 | |
|
Interactive Media & Services – 0.3% | |
| | |
Meta Platforms, Inc. | | | | | | | | |
4.60%, 5/15/2028 | | | 100,000 | | | | 96,934 | |
3.85%, 8/15/2032 | | | 281,000 | | | | 244,225 | |
4.95%, 5/15/2033 | | | 300,000 | | | | 281,230 | |
| | |
Weibo Corp. | | | | | | | | |
3.38%, 7/8/2030 | | | 200,000 | | | | 154,978 | |
| | | | | | | 777,367 | |
|
IT Services – 0.8% | |
| | |
Amdocs Ltd. | | | | | | | | |
2.54%, 6/15/2030 | | | 250,000 | | | | 196,742 | |
| | |
Booz Allen Hamilton, Inc. | | | | | | | | |
5.95%, 8/4/2033 | | | 100,000 | | | | 95,043 | |
| | |
CGI, Inc. | | | | | | | | |
1.45%, 9/14/2026 | | | 101,000 | | | | 89,072 | |
2.30%, 9/14/2031 | | | 100,000 | | | | 73,543 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
IT Services – (continued) | |
| | |
Genpact Luxembourg Sarl | | | | | | | | |
3.38%, 12/1/2024 | | $ | 192,000 | | | $ | 185,139 | |
| | |
International Business Machines Corp. | | | | | | | | |
3.30%, 5/15/2026 | | | 250,000 | | | | 236,442 | |
4.15%, 7/27/2027 | | | 192,000 | | | | 181,948 | |
3.50%, 5/15/2029 | | | 505,000 | | | | 450,045 | |
1.95%, 5/15/2030 | | | 100,000 | | | | 78,872 | |
| | |
VeriSign, Inc. | | | | | | | | |
5.25%, 4/1/2025 | | | 250,000 | | | | 247,033 | |
4.75%, 7/15/2027 | | | 100,000 | | | | 95,316 | |
2.70%, 6/15/2031 | | | 200,000 | | | | 154,452 | |
| | | | | | | 2,083,647 | |
|
Life Sciences Tools & Services – 0.2% | |
| | |
Agilent Technologies, Inc. | | | | | | | | |
2.75%, 9/15/2029 | | | 332,000 | | | | 280,073 | |
2.30%, 3/12/2031 | | | 201,000 | | | | 155,722 | |
| | | | | | | 435,795 | |
|
Machinery – 1.2% | |
| | |
Dover Corp. | | | | | | | | |
3.15%, 11/15/2025 | | | 151,000 | | | | 143,368 | |
| | |
Fortive Corp. | | | | | | | | |
3.15%, 6/15/2026 | | | 251,000 | | | | 233,922 | |
| | |
IDEX Corp. | | | | | | | | |
3.00%, 5/1/2030 | | | 150,000 | | | | 124,025 | |
2.63%, 6/15/2031 | | | 200,000 | | | | 156,073 | |
| | |
Ingersoll Rand, Inc. | | | | | | | | |
5.70%, 8/14/2033 | | | 250,000 | | | | 236,218 | |
| | |
Nordson Corp. | | | | | | | | |
5.80%, 9/15/2033 | | | 100,000 | | | | 95,191 | |
| | |
nVent Finance Sarl | | | | | | | | |
4.55%, 4/15/2028 | | | 100,000 | | | | 92,764 | |
5.65%, 5/15/2033 | | | 100,000 | | | | 90,785 | |
| | |
Oshkosh Corp. | | | | | | | | |
4.60%, 5/15/2028 | | | 200,000 | | | | 189,523 | |
| | |
Otis Worldwide Corp. | | | | | | | | |
2.06%, 4/5/2025 | | | 498,000 | | | | 471,930 | |
2.29%, 4/5/2027 | | | 200,000 | | | | 178,192 | |
2.57%, 2/15/2030 | | | 453,000 | | | | 368,577 | |
| | |
Stanley Black & Decker, Inc. | | | | | | | | |
4.00%, 3/15/2060(b) | | | 200,000 | | | | 164,171 | |
See Accompanying Notes to the Financial Statements.
| | | | |
398 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Machinery – (continued) | |
| | |
Westinghouse Air Brake Technologies Corp. | | | | | | | | |
3.45%, 11/15/2026 | | $ | 240,000 | | | $ | 222,632 | |
4.70%, 9/15/2028(a) | | | 364,000 | | | | 339,392 | |
| | |
Xylem, Inc. | | | | | | | | |
3.25%, 11/1/2026 | | | 200,000 | | | | 186,088 | |
| | | | | | | 3,292,851 | |
|
Media – 0.4% | |
| | |
Fox Corp. | | | | | | | | |
4.71%, 1/25/2029 | | | 400,000 | | | | 373,811 | |
3.50%, 4/8/2030 | | | 102,000 | | | | 86,497 | |
6.50%, 10/13/2033 | | | 100,000 | | | | 97,666 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | | | | | | |
4.75%, 3/30/2030 | | | 202,000 | | | | 184,211 | |
| | |
Omnicom Group, Inc. | | | | | | | | |
3.60%, 4/15/2026 | | | 200,000 | | | | 189,438 | |
4.20%, 6/1/2030 | | | 200,000 | | | | 176,153 | |
| | | | | | | 1,107,776 | |
|
Metals & Mining – 1.0% | |
| | |
AngloGold Ashanti Holdings plc | | | | | | | | |
3.38%, 11/1/2028 | | | 52,000 | | | | 43,063 | |
| | |
ArcelorMittal SA | | | | | | | | |
6.55%, 11/29/2027 | | | 182,000 | | | | 182,858 | |
4.25%, 7/16/2029 | | | 82,000 | | | | 73,848 | |
6.80%, 11/29/2032 | | | 250,000 | | | | 239,455 | |
| | |
BHP Billiton Finance USA Ltd. | | | | | | | | |
4.88%, 2/27/2026 | | | 300,000 | | | | 295,320 | |
4.75%, 2/28/2028 | | | 160,000 | | | | 154,469 | |
5.25%, 9/8/2033 | | | 200,000 | | | | 187,982 | |
| | |
Freeport-McMoRan, Inc. | | | | | | | | |
4.63%, 8/1/2030 | | | 250,000 | | | | 220,271 | |
| | |
Reliance Steel & Aluminum Co. | | | | | | | | |
1.30%, 8/15/2025 | | | 252,000 | | | | 231,592 | |
2.15%, 8/15/2030 | | | 150,000 | | | | 114,825 | |
| | |
Rio Tinto Alcan, Inc. | | | | | | | | |
7.25%, 3/15/2031 | | | 50,000 | | | | 53,420 | |
| | |
Rio Tinto Finance USA Ltd. | | | | | | | | |
7.13%, 7/15/2028 | | | 172,000 | | | | 182,259 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Steel Dynamics, Inc. | | | | | | | | |
2.80%, 12/15/2024 | | $ | 201,000 | | | $ | 193,617 | |
3.45%, 4/15/2030 | | | 100,000 | | | | 84,588 | |
| | |
Vale Canada Ltd. | | | | | | | | |
7.20%, 9/15/2032 | | | 100,000 | | | | 100,712 | |
| | |
Vale Overseas Ltd. | | | | | | | | |
3.75%, 7/8/2030 | | | 305,000 | | | | 257,664 | |
6.13%, 6/12/2033 | | | 150,000 | | | | 141,054 | |
| | | | | | | 2,756,997 | |
|
Multi-Utilities – 1.5% | |
| | |
Ameren Corp. | | | | | | | | |
3.65%, 2/15/2026 | | | 100,000 | | | | 95,129 | |
1.75%, 3/15/2028 | | | 152,000 | | | | 127,337 | |
| | |
Ameren Illinois Co. | | | | | | | | |
4.95%, 6/1/2033 | | | 200,000 | | | | 184,203 | |
| | |
Berkshire Hathaway Energy Co. | | | | | | | | |
3.50%, 2/1/2025 | | | 250,000 | | | | 243,033 | |
4.05%, 4/15/2025 | | | 800,000 | | | | 781,380 | |
3.25%, 4/15/2028 | | | 200,000 | | | | 179,341 | |
3.70%, 7/15/2030 | | | 353,000 | | | | 307,104 | |
1.65%, 5/15/2031 | | | 300,000 | | | | 218,831 | |
| | |
CenterPoint Energy, Inc. | | | | | | | | |
2.95%, 3/1/2030 | | | 152,000 | | | | 124,823 | |
| | |
CMS Energy Corp. | | | | | | | | |
4.75%, 6/1/2050(b) | | | 50,000 | | | | 41,463 | |
3.75%, 12/1/2050(b) | | | 100,000 | | | | 71,989 | |
| | |
DTE Energy Co. | | | | | | | | |
Series C, 3.40%, 6/15/2029 | | | 102,000 | | | | 88,494 | |
| | |
Public Service Enterprise Group, Inc. | | | | | | | | |
0.80%, 8/15/2025 | | | 152,000 | | | | 139,031 | |
5.85%, 11/15/2027 | | | 200,000 | | | | 198,939 | |
2.45%, 11/15/2031 | | | 150,000 | | | | 113,369 | |
| | |
Puget Energy, Inc. | | | | | | | | |
4.10%, 6/15/2030 | | | 50,000 | | | | 42,708 | |
| | |
Sempra | | | | | | | | |
3.30%, 4/1/2025 | | | 200,000 | | | | 192,330 | |
3.25%, 6/15/2027 | | | 30,000 | | | | 27,180 | |
3.40%, 2/1/2028 | | | 300,000 | | | | 270,342 | |
3.70%, 4/1/2029 | | | 200,000 | | | | 177,268 | |
5.50%, 8/1/2033 | | | 150,000 | | | | 139,497 | |
4.13%, 4/1/2052(b) | | | 100,000 | | | | 77,028 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 399 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Multi-Utilities – (continued) | |
| | |
WEC Energy Group, Inc. | | | | | | | | |
4.75%, 1/15/2028 | | $ | 200,000 | | | $ | 191,224 | |
2.20%, 12/15/2028 | | | 100,000 | | | | 83,329 | |
| | | | | | | 4,115,372 | |
|
Office REITs – 0.3% | |
| | |
Alexandria Real Estate Equities, Inc. | | | | | | | | |
REIT, 3.38%, 8/15/2031 | | | 200,000 | | | | 162,286 | |
| | |
Boston Properties LP | | | | | | | | |
REIT, 2.90%, 3/15/2030 | | | 100,000 | | | | 76,692 | |
REIT, 3.25%, 1/30/2031 | | | 100,000 | | | | 75,853 | |
| | |
Corporate Office Properties LP | | | | | | | | |
REIT, 2.25%, 3/15/2026 | | | 50,000 | | | | 45,214 | |
REIT, 2.00%, 1/15/2029 | | | 150,000 | | | | 113,968 | |
REIT, 2.75%, 4/15/2031 | | | 100,000 | | | | 73,294 | |
| | |
Highwoods Realty LP | | | | | | | | |
REIT, 4.13%, 3/15/2028 | | | 100,000 | | | | 86,215 | |
REIT, 4.20%, 4/15/2029 | | | 50,000 | | | | 41,995 | |
| | |
Hudson Pacific Properties LP | | | | | | | | |
REIT, 5.95%, 2/15/2028 | | | 50,000 | | | | 39,357 | |
| | |
Kilroy Realty LP | | | | | | | | |
REIT, 4.38%, 10/1/2025 | | | 101,000 | | | | 96,483 | |
REIT, 4.25%, 8/15/2029 | | | 50,000 | | | | 41,595 | |
REIT, 3.05%, 2/15/2030 | | | 150,000 | | | | 115,236 | |
| | | | | | | 968,188 | |
|
Oil, Gas & Consumable Fuels – 11.3% | |
| | |
Boardwalk Pipelines LP | | | | | | | | |
4.95%, 12/15/2024 | | | 250,000 | | | | 246,077 | |
5.95%, 6/1/2026 | | | 150,000 | | | | 148,588 | |
4.80%, 5/3/2029 | | | 302,000 | | | | 277,979 | |
3.40%, 2/15/2031 | | | 200,000 | | | | 163,215 | |
3.60%, 9/1/2032 | | | 100,000 | | | | 79,265 | |
| | |
Burlington Resources LLC | | | | | | | | |
7.40%, 12/1/2031 | | | 200,000 | | | | 218,068 | |
| | |
Canadian Natural Resources Ltd. | | | | | | | | |
3.90%, 2/1/2025 | | | 250,000 | | | | 243,022 | |
2.05%, 7/15/2025 | | | 250,000 | | | | 233,467 | |
3.85%, 6/1/2027 | | | 390,000 | | | | 361,538 | |
2.95%, 7/15/2030 | | | 70,000 | | | | 57,081 | |
7.20%, 1/15/2032 | | | 100,000 | | | | 103,102 | |
6.45%, 6/30/2033 | | | 150,000 | | | | 146,175 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Cenovus Energy, Inc. | | | | | | | | |
2.65%, 1/15/2032 | | $ | 150,000 | | | $ | 113,366 | |
| | |
Cheniere Corpus Christi Holdings LLC | | | | | | | | |
5.13%, 6/30/2027 | | | 50,000 | | | | 48,242 | |
3.70%, 11/15/2029 | | | 150,000 | | | | 130,697 | |
| | |
Cheniere Energy Partners LP | | | | | | | | |
4.50%, 10/1/2029 | | | 300,000 | | | | 268,604 | |
4.00%, 3/1/2031 | | | 300,000 | | | | 251,210 | |
5.95%, 6/30/2033(c) | | | 200,000 | | | | 187,036 | |
| | |
Cheniere Energy, Inc. | | | | | | | | |
4.63%, 10/15/2028 | | | 327,000 | | | | 298,778 | |
| | |
Chevron Corp. | | | | | | | | |
1.55%, 5/11/2025 | | | 303,000 | | | | 285,857 | |
2.00%, 5/11/2027 | | | 260,000 | | | | 232,210 | |
| | |
Chevron USA, Inc. | | | | | | | | |
0.69%, 8/12/2025 | | | 252,000 | | | | 232,274 | |
3.85%, 1/15/2028 | | | 291,000 | | | | 275,473 | |
3.25%, 10/15/2029 | | | 30,000 | | | | 26,654 | |
| | |
ConocoPhillips | | | | | | | | |
5.90%, 10/15/2032 | | | 200,000 | | | | 201,390 | |
| | |
ConocoPhillips Co. | | | | | | | | |
6.95%, 4/15/2029 | | | 101,000 | | | | 107,754 | |
5.05%, 9/15/2033 | | | 200,000 | | | | 186,358 | |
| | |
Continental Resources, Inc. | | | | | | | | |
4.38%, 1/15/2028 | | | 293,000 | | | | 269,951 | |
| | |
Coterra Energy, Inc. | | | | | | | | |
3.90%, 5/15/2027 | | | 202,000 | | | | 188,341 | |
4.38%, 3/15/2029 | | | 150,000 | | | | 137,230 | |
| | |
DCP Midstream Operating LP | | | | | | | | |
5.63%, 7/15/2027 | | | 142,000 | | | | 139,401 | |
5.13%, 5/15/2029 | | | 30,000 | | | | 28,326 | |
| | |
Devon Energy Corp. | | | | | | | | |
4.50%, 1/15/2030 | | | 101,000 | | | | 89,818 | |
7.95%, 4/15/2032 | | | 150,000 | | | | 162,165 | |
| | |
Diamondback Energy, Inc. | | | | | | | | |
3.50%, 12/1/2029 | | | 303,000 | | | | 265,067 | |
6.25%, 3/15/2033 | | | 250,000 | | | | 246,757 | |
| | |
Eastern Gas Transmission & Storage, Inc. | | | | | | | | |
3.00%, 11/15/2029 | | | 202,000 | | | | 169,512 | |
| | |
Enbridge, Inc. | | | | | | | | |
Series 16-A, 6.00%, 1/15/2077(b) | | | 150,000 | | | | 130,528 | |
See Accompanying Notes to the Financial Statements.
| | | | |
400 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
5.50%, 7/15/2077(b) | | $ | 100,000 | | | $ | 85,080 | |
6.25%, 3/1/2078(b) | | | 202,000 | | | | 176,921 | |
Series 20-A, 5.75%, 7/15/2080(b) | | | 202,000 | | | | 168,378 | |
7.38%, 1/15/2083(b) | | | 200,000 | | | | 185,021 | |
| | |
Energy Transfer LP | | | | | | | | |
4.05%, 3/15/2025 | | | 250,000 | | | | 243,015 | |
2.90%, 5/15/2025 | | | 250,000 | | | | 238,149 | |
4.75%, 1/15/2026 | | | 200,000 | | | | 194,071 | |
4.40%, 3/15/2027 | | | 250,000 | | | | 235,469 | |
4.20%, 4/15/2027 | | | 250,000 | | | | 234,126 | |
5.50%, 6/1/2027 | | | 182,000 | | | | 177,510 | |
4.00%, 10/1/2027 | | | 100,000 | | | | 92,071 | |
4.95%, 5/15/2028 | | | 422,000 | | | | 399,036 | |
4.95%, 6/15/2028 | | | 250,000 | | | | 236,292 | |
5.25%, 4/15/2029 | | | 300,000 | | | | 284,721 | |
4.15%, 9/15/2029 | | | 182,000 | | | | 161,838 | |
3.75%, 5/15/2030 | | | 220,000 | | | | 188,029 | |
6.40%, 12/1/2030 | | | 150,000 | | | | 148,377 | |
5.75%, 2/15/2033 | | | 250,000 | | | | 234,362 | |
| | |
Enterprise Products Operating LLC | | | | | | | | |
3.75%, 2/15/2025 | | | 193,000 | | | | 187,891 | |
5.05%, 1/10/2026 | | | 400,000 | | | | 395,258 | |
3.70%, 2/15/2026 | | | 170,000 | | | | 162,553 | |
3.95%, 2/15/2027 | | | 303,000 | | | | 286,704 | |
4.15%, 10/16/2028 | | | 281,000 | | | | 261,164 | |
3.13%, 7/31/2029 | | | 252,000 | | | | 218,756 | |
2.80%, 1/31/2030 | | | 457,000 | | | | 381,740 | |
5.35%, 1/31/2033 | | | 502,000 | | | | 478,483 | |
Series E, 5.25%, 8/16/2077(b) | | | 202,000 | | | | 173,361 | |
5.38%, 2/15/2078(b) | | | 351,000 | | | | 298,076 | |
| | |
EOG Resources, Inc. | | | | | | | | |
3.15%, 4/1/2025 | | | 250,000 | | | | 241,046 | |
4.38%, 4/15/2030 | | | 202,000 | | | | 187,051 | |
| | |
EQT Corp. | | | | | | | | |
6.13%, 2/1/2025(a) | | | 111,000 | | | | 110,659 | |
7.00%, 2/1/2030(a) | | | 100,000 | | | | 101,322 | |
| | |
Exxon Mobil Corp. | | | | | | | | |
2.71%, 3/6/2025 | | | 111,000 | | | | 107,068 | |
2.99%, 3/19/2025 | | | 480,000 | | | | 464,303 | |
3.04%, 3/1/2026 | | | 250,000 | | | | 237,564 | |
2.44%, 8/16/2029 | | | 100,000 | | | | 85,400 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
3.48%, 3/19/2030 | | $ | 400,000 | | | $ | 354,539 | |
2.61%, 10/15/2030 | | | 201,000 | | | | 166,825 | |
| | |
Hess Corp. | | | | | | | | |
7.88%, 10/1/2029 | | | 178,000 | | | | 195,512 | |
| | |
HF Sinclair Corp. | | | | | | | | |
5.88%, 4/1/2026 | | | 190,000 | | | | 187,363 | |
4.50%, 10/1/2030 | | | 100,000 | | | | 85,017 | |
| | |
Kinder Morgan Energy Partners LP | | | | | | | | |
7.40%, 3/15/2031 | | | 250,000 | | | | 258,407 | |
| | |
Kinder Morgan, Inc. | | | | | | | | |
4.30%, 6/1/2025 | | | 100,000 | | | | 97,332 | |
4.30%, 3/1/2028 | | | 350,000 | | | | 326,409 | |
7.80%, 8/1/2031 | | | 252,000 | | | | 266,520 | |
4.80%, 2/1/2033 | | | 250,000 | | | | 218,614 | |
5.20%, 6/1/2033 | | | 250,000 | | | | 225,303 | |
| | |
Magellan Midstream Partners LP | | | | | | | | |
5.00%, 3/1/2026 | | | 202,000 | | | | 197,075 | |
3.25%, 6/1/2030 | | | 200,000 | | | | 166,027 | |
| | |
Marathon Oil Corp. | | | | | | | | |
4.40%, 7/15/2027 | | | 201,000 | | | | 188,351 | |
| | |
Marathon Petroleum Corp. | | | | | | | | |
4.70%, 5/1/2025 | | | 252,000 | | | | 246,749 | |
3.80%, 4/1/2028 | | | 202,000 | | | | 184,296 | |
| | |
MPLX LP | | | | | | | | |
4.88%, 12/1/2024 | | | 81,000 | | | | 79,907 | |
4.00%, 2/15/2025 | | | 250,000 | | | | 243,453 | |
4.88%, 6/1/2025 | | | 414,000 | | | | 405,852 | |
1.75%, 3/1/2026 | | | 302,000 | | | | 274,005 | |
4.13%, 3/1/2027 | | | 352,000 | | | | 330,575 | |
4.25%, 12/1/2027 | | | 200,000 | | | | 186,043 | |
4.00%, 3/15/2028 | | | 351,000 | | | | 321,556 | |
4.80%, 2/15/2029 | | | 100,000 | | | | 93,538 | |
2.65%, 8/15/2030 | | | 300,000 | | | | 236,999 | |
4.95%, 9/1/2032 | | | 300,000 | | | | 266,327 | |
5.00%, 3/1/2033 | | | 300,000 | | | | 265,660 | |
| | |
Occidental Petroleum Corp. | | | | | | | | |
5.88%, 9/1/2025 | | | 250,000 | | | | 249,133 | |
8.50%, 7/15/2027 | | | 260,000 | | | | 277,022 | |
8.88%, 7/15/2030 | | | 262,000 | | | | 290,941 | |
6.63%, 9/1/2030 | | | 303,000 | | | | 303,926 | |
6.13%, 1/1/2031 | | | 200,000 | | | | 195,592 | |
7.50%, 5/1/2031 | | | 150,000 | | | | 157,288 | |
7.88%, 9/15/2031 | | | 122,000 | | | | 130,619 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 401 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
ONEOK Partners LP | | | | | | | | |
4.90%, 3/15/2025 | | $ | 300,000 | | | $ | 294,664 | |
| | |
ONEOK, Inc. | | | | | | | | |
5.85%, 1/15/2026 | | | 250,000 | | | | 249,752 | |
4.00%, 7/13/2027 | | | 190,000 | | | | 176,623 | |
4.55%, 7/15/2028 | | | 110,000 | | | | 102,551 | |
4.35%, 3/15/2029 | | | 292,000 | | | | 265,330 | |
3.40%, 9/1/2029 | | | 400,000 | | | | 342,266 | |
3.10%, 3/15/2030 | | | 229,000 | | | | 188,916 | |
6.35%, 1/15/2031 | | | 50,000 | | | | 49,320 | |
6.10%, 11/15/2032 | | | 400,000 | | | | 385,458 | |
6.05%, 9/1/2033 | | | 250,000 | | | | 239,589 | |
| | |
Phillips 66 Co. | | | | | | | | |
3.61%, 2/15/2025 | | | 100,000 | | | | 97,095 | |
3.55%, 10/1/2026 | | | 100,000 | | | | 93,970 | |
5.30%, 6/30/2033 | | | 100,000 | | | | 93,197 | |
| | |
Pioneer Natural Resources Co. | | | | | | | | |
1.13%, 1/15/2026 | | | 100,000 | | | | 90,741 | |
5.10%, 3/29/2026 | | | 150,000 | | | | 148,345 | |
1.90%, 8/15/2030 | | | 100,000 | | | | 78,133 | |
2.15%, 1/15/2031 | | | 200,000 | | | | 157,073 | |
| | |
Plains All American Pipeline LP | | | | | | | | |
4.65%, 10/15/2025 | | | 250,000 | | | | 242,158 | |
4.50%, 12/15/2026 | | | 250,000 | | | | 238,253 | |
3.55%, 12/15/2029 | | | 252,000 | | | | 214,173 | |
3.80%, 9/15/2030 | | | 101,000 | | | | 85,112 | |
| | |
Sabine Pass Liquefaction LLC | | | | | | | | |
5.00%, 3/15/2027 | | | 322,000 | | | | 310,106 | |
4.50%, 5/15/2030 | | | 200,000 | | | | 179,396 | |
| | |
Suncor Energy, Inc. | | | | | | | | |
7.88%, 6/15/2026 | | | 150,000 | | | | 156,424 | |
7.15%, 2/1/2032 | | | 150,000 | | | | 154,773 | |
| | |
Targa Resources Corp. | | | | | | | | |
4.20%, 2/1/2033 | | | 150,000 | | | | 124,329 | |
| | |
Targa Resources Partners LP | | | | | | | | |
5.50%, 3/1/2030 | | | 250,000 | | | | 230,380 | |
4.88%, 2/1/2031 | | | 200,000 | | | | 176,307 | |
| | |
Tennessee Gas Pipeline Co. LLC | | | | | | | | |
7.00%, 10/15/2028 | | | 100,000 | | | | 102,468 | |
| | |
Texas Eastern Transmission LP | | | | | | | | |
7.00%, 7/15/2032 | | | 100,000 | | | | 104,221 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Tosco Corp. | | | | | | | | |
8.13%, 2/15/2030 | | $ | 152,000 | | | $ | 167,771 | |
| | |
TotalEnergies Capital International SA | | | | | | | | |
2.43%, 1/10/2025 | | | 50,000 | | | | 48,195 | |
2.83%, 1/10/2030 | | | 252,000 | | | | 214,888 | |
| | |
Transcanada Trust | | | | | | | | |
Series 16-A, 5.88%, 8/15/2076(b) | | | 150,000 | | | | 134,358 | |
5.50%, 9/15/2079(b) | | | 200,000 | | | | 158,461 | |
5.60%, 3/7/2082(b) | | | 25,000 | | | | 19,295 | |
| | |
Transcontinental Gas Pipe Line Co. LLC | | | | | | | | |
4.00%, 3/15/2028 | | | 62,000 | | | | 57,047 | |
| | |
Valero Energy Corp. | | | | | | | | |
2.85%, 4/15/2025 | | | 100,000 | | | | 95,601 | |
4.35%, 6/1/2028 | | | 200,000 | | | | 187,226 | |
2.80%, 12/1/2031 | | | 200,000 | | | | 154,798 | |
7.50%, 4/15/2032 | | | 100,000 | | | | 106,110 | |
| | |
Valero Energy Partners LP | | | | | | | | |
4.50%, 3/15/2028 | | | 200,000 | | | | 188,271 | |
| | |
Western Midstream Operating LP | | | | | | | | |
3.10%, 2/1/2025(a) | | | 200,000 | | | | 192,150 | |
4.65%, 7/1/2026 | | | 252,000 | | | | 240,938 | |
4.05%, 2/1/2030(a) | | | 620,000 | | | | 537,506 | |
6.15%, 4/1/2033 | | | 100,000 | | | | 94,578 | |
| | |
Williams Cos., Inc. (The) | | | | | | | | |
7.75%, 6/15/2031 | | | 100,000 | | | | 104,290 | |
8.75%, 3/15/2032(a) | | | 200,000 | | | | 222,249 | |
| | | | | | | 30,979,071 | |
|
Paper & Forest Products – 0.1% | |
| | |
Suzano Austria GmbH | | | | | | | | |
6.00%, 1/15/2029 | | | 252,000 | | | | 242,499 | |
|
Personal Care Products – 0.0%(d) | |
| | |
Conopco, Inc. | | | | | | | | |
6.63%, 4/15/2028 | | | 90,000 | | | | 94,403 | |
|
Pharmaceuticals – 0.8% | |
| | |
Eli Lilly & Co. | | | | | | | | |
3.38%, 3/15/2029 | | | 183,000 | | | | 166,546 | |
4.70%, 2/27/2033 | | | 260,000 | | | | 244,163 | |
See Accompanying Notes to the Financial Statements.
| | | | |
402 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Pharmaceuticals – (continued) | |
| | |
Merck & Co., Inc. | | | | | | | | |
3.40%, 3/7/2029 | | $ | 300,000 | | | $ | 271,232 | |
1.45%, 6/24/2030 | | | 250,000 | | | | 192,215 | |
2.15%, 12/10/2031 | | | 200,000 | | | | 154,161 | |
4.50%, 5/17/2033 | | | 100,000 | | | | 90,908 | |
| | |
Royalty Pharma plc | | | | | | | | |
1.20%, 9/2/2025 | | | 232,000 | | | | 211,550 | |
| | |
Zoetis, Inc. | | | | | | | | |
5.40%, 11/14/2025 | | | 250,000 | | | | 248,197 | |
3.00%, 9/12/2027 | | | 96,000 | | | | 87,232 | |
3.90%, 8/20/2028 | | | 252,000 | | | | 234,261 | |
2.00%, 5/15/2030 | | | 200,000 | | | | 157,520 | |
5.60%, 11/16/2032 | | | 200,000 | | | | 193,880 | |
| | | | | | | 2,251,865 | |
|
Professional Services – 0.8% | |
| | |
Automatic Data Processing, Inc. | | | | | | | | |
3.38%, 9/15/2025 | | | 50,000 | | | | 48,225 | |
1.70%, 5/15/2028 | | | 200,000 | | | | 171,681 | |
1.25%, 9/1/2030 | | | 151,000 | | | | 114,820 | |
| | |
Broadridge Financial Solutions, Inc. | | | | | | | | |
3.40%, 6/27/2026 | | | 200,000 | | | | 187,095 | |
2.90%, 12/1/2029 | | | 252,000 | | | | 209,581 | |
2.60%, 5/1/2031 | | | 200,000 | | | | 155,149 | |
| | |
Equifax, Inc. | | | | | | | | |
3.25%, 6/1/2026 | | | 250,000 | | | | 231,717 | |
3.10%, 5/15/2030 | | | 202,000 | | | | 165,831 | |
2.35%, 9/15/2031 | | | 300,000 | | | | 223,145 | |
| | |
Jacobs Engineering Group, Inc. | | | | | | | | |
6.35%, 8/18/2028 | | | 100,000 | | | | 99,444 | |
5.90%, 3/1/2033 | | | 150,000 | | | | 138,927 | |
| | |
Verisk Analytics, Inc. | | | | | | | | |
4.00%, 6/15/2025 | | | 250,000 | | | | 242,182 | |
4.13%, 3/15/2029 | | | 252,000 | | | | 230,662 | |
5.75%, 4/1/2033 | | | 100,000 | | | | 95,835 | |
| | | | | | | 2,314,294 | |
|
Real Estate Management & Development – 0.1% | |
| | |
CBRE Services, Inc. | | | | | | | | |
4.88%, 3/1/2026 | | | 200,000 | | | | 193,433 | |
2.50%, 4/1/2031 | | | 101,000 | | | | 76,034 | |
| | | | | | | 269,467 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Residential REITs – 1.1% | |
| | |
American Homes 4 Rent LP | | | | | | | | |
REIT, 4.90%, 2/15/2029 | | $ | 162,000 | | | $ | 150,745 | |
| | |
AvalonBay Communities, Inc. | | | | | | | | |
REIT, 3.45%, 6/1/2025 | | | 151,000 | | | | 145,600 | |
REIT, 3.50%, 11/15/2025 | | | 50,000 | | | | 47,728 | |
REIT, 2.30%, 3/1/2030 | | | 200,000 | | | | 160,606 | |
| | |
ERP Operating LP | | | | | | | | |
REIT, 3.25%, 8/1/2027 | | | 45,000 | | | | 40,922 | |
REIT, 3.00%, 7/1/2029 | | | 303,000 | | | | 260,166 | |
| | |
Essential Properties LP | | | | | | | | |
REIT, 2.95%, 7/15/2031 | | | 100,000 | | | | 71,539 | |
| | |
Essex Portfolio LP | | | | | | | | |
REIT, 3.63%, 5/1/2027 | | | 200,000 | | | | 183,552 | |
REIT, 4.00%, 3/1/2029 | | | 151,000 | | | | 135,334 | |
REIT, 3.00%, 1/15/2030 | | | 252,000 | | | | 205,662 | |
REIT, 1.65%, 1/15/2031 | | | 100,000 | | | | 72,111 | |
REIT, 2.65%, 3/15/2032 | | | 150,000 | | | | 113,090 | |
| | |
Invitation Homes Operating Partnership LP | | | | | | | | |
REIT, 2.30%, 11/15/2028 | | | 300,000 | | | | 248,208 | |
REIT, 2.00%, 8/15/2031 | | | 100,000 | | | | 72,003 | |
| | |
Mid-America Apartments LP | | | | | | | | |
REIT, 3.95%, 3/15/2029 | | | 303,000 | | | | 275,694 | |
REIT, 2.75%, 3/15/2030 | | | 151,000 | | | | 124,072 | |
| | |
Spirit Realty LP | | | | | | | | |
REIT, 2.10%, 3/15/2028 | | | 100,000 | | | | 83,352 | |
REIT, 4.00%, 7/15/2029 | | | 100,000 | | | | 87,177 | |
REIT, 3.40%, 1/15/2030 | | | 202,000 | | | | 166,290 | |
REIT, 3.20%, 2/15/2031 | | | 100,000 | | | | 78,732 | |
| | |
Tanger Properties LP | | | | | | | | |
REIT, 3.13%, 9/1/2026 | | | 200,000 | | | | 180,743 | |
REIT, 3.88%, 7/15/2027 | | | 100,000 | | | | 87,692 | |
REIT, 2.75%, 9/1/2031 | | | 100,000 | | | | 70,742 | |
| | | | | | | 3,061,760 | |
|
Retail REITs – 1.0% | |
| | |
Agree LP | | | | | | | | |
REIT, 2.00%, 6/15/2028 | | | 202,000 | | | | 165,639 | |
REIT, 2.90%, 10/1/2030 | | | 150,000 | | | | 119,464 | |
REIT, 4.80%, 10/1/2032 | | | 150,000 | | | | 130,221 | |
| | |
Brixmor Operating Partnership LP | | | | | | | | |
REIT, 3.85%, 2/1/2025 | | | 250,000 | | | | 240,792 | |
REIT, 4.13%, 6/15/2026 | | | 252,000 | | | | 237,139 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 403 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Retail REITs – (continued) | |
REIT, 4.13%, 5/15/2029 | | $ | 252,000 | | | $ | 220,662 | |
REIT, 4.05%, 7/1/2030 | | | 151,000 | | | | 128,917 | |
| | |
NNN REIT, Inc. | | | | | | | | |
REIT, 4.00%, 11/15/2025 | | | 50,000 | | | | 47,948 | |
REIT, 3.60%, 12/15/2026 | | | 200,000 | | | | 185,322 | |
REIT, 3.50%, 10/15/2027 | | | 151,000 | | | | 136,945 | |
REIT, 4.30%, 10/15/2028 | | | 91,000 | | | | 83,054 | |
REIT, 2.50%, 4/15/2030 | | | 100,000 | | | | 79,570 | |
REIT, 5.60%, 10/15/2033 | | | 100,000 | | | | 92,173 | |
| | |
Phillips Edison Grocery Center Operating Partnership I LP | | | | | | | | |
REIT, 2.63%, 11/15/2031 | | | 100,000 | | | | 71,826 | |
| | |
Realty Income Corp. | | | | | | | | |
REIT, 4.63%, 11/1/2025 | | | 202,000 | | | | 196,929 | |
REIT, 4.90%, 7/15/2033 | | | 50,000 | | | | 44,443 | |
| | |
Regency Centers LP | | | | | | | | |
REIT, 2.95%, 9/15/2029 | | | 150,000 | | | | 125,320 | |
REIT, 3.70%, 6/15/2030 | | | 252,000 | | | | 213,986 | |
| | |
SITE Centers Corp. | | | | | | | | |
REIT, 4.70%, 6/1/2027 | | | 200,000 | | | | 184,169 | |
| | | | | | | 2,704,519 | |
|
Semiconductors & Semiconductor Equipment – 3.6% | |
| | |
Broadcom Corp. | | | | | | | | |
3.88%, 1/15/2027 | | | 494,000 | | | | 461,723 | |
3.50%, 1/15/2028 | | | 553,000 | | | | 498,185 | |
| | |
Broadcom, Inc. | | | | | | | | |
3.15%, 11/15/2025 | | | 350,000 | | | | 331,544 | |
3.46%, 9/15/2026 | | | 351,000 | | | | 329,312 | |
1.95%, 2/15/2028(c) | | | 250,000 | | | | 210,976 | |
4.11%, 9/15/2028 | | | 405,000 | | | | 371,478 | |
4.00%, 4/15/2029(c) | | | 404,000 | | | | 360,872 | |
4.75%, 4/15/2029 | | | 505,000 | | | | 469,604 | |
5.00%, 4/15/2030 | | | 150,000 | | | | 140,181 | |
4.15%, 11/15/2030 | | | 500,000 | | | | 435,222 | |
2.45%, 2/15/2031(c) | | | 600,000 | | | | 460,450 | |
4.15%, 4/15/2032(c) | | | 250,000 | | | | 211,528 | |
4.30%, 11/15/2032 | | | 600,000 | | | | 510,599 | |
2.60%, 2/15/2033(c) | | | 550,000 | | | | 399,049 | |
3.42%, 4/15/2033(c) | | | 640,000 | | | | 497,615 | |
| | |
Lam Research Corp. | | | | | | | | |
3.75%, 3/15/2026 | | | 300,000 | | | | 287,943 | |
4.00%, 3/15/2029 | | | 150,000 | | | | 139,236 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
Microchip Technology, Inc. | | | | | | | | |
4.25%, 9/1/2025 | | $ | 250,000 | | | $ | 241,086 | |
| | |
Micron Technology, Inc. | | | | | | | | |
4.66%, 2/15/2030 | | | 350,000 | | | | 313,643 | |
| | |
NXP BV | | | | | | | | |
2.70%, 5/1/2025 | | | 250,000 | | | | 237,596 | |
3.88%, 6/18/2026 | | | 50,000 | | | | 47,290 | |
3.15%, 5/1/2027 | | | 200,000 | | | | 181,050 | |
4.30%, 6/18/2029 | | | 250,000 | | | | 225,582 | |
3.40%, 5/1/2030 | | | 252,000 | | | | 211,393 | |
5.00%, 1/15/2033 | | | 200,000 | | | | 178,317 | |
| | |
Qorvo, Inc. | | | | | | | | |
4.38%, 10/15/2029 | | | 202,000 | | | | 175,391 | |
| | |
Skyworks Solutions, Inc. | | | | | | | | |
1.80%, 6/1/2026 | | | 201,000 | | | | 179,388 | |
3.00%, 6/1/2031 | | | 100,000 | | | | 76,580 | |
| | |
Texas Instruments, Inc. | | | | | | | | |
1.38%, 3/12/2025 | | | 202,000 | | | | 191,253 | |
2.90%, 11/3/2027 | | | 252,000 | | | | 229,486 | |
3.65%, 8/16/2032 | | | 150,000 | | | | 128,483 | |
4.90%, 3/14/2033 | | | 200,000 | | | | 188,175 | |
| | |
TSMC Arizona Corp. | | | | | | | | |
1.75%, 10/25/2026 | | | 500,000 | | | | 448,853 | |
3.88%, 4/22/2027 | | | 252,000 | | | | 238,870 | |
2.50%, 10/25/2031 | | | 200,000 | | | | 158,166 | |
| | | | | | | 9,766,119 | |
|
Software – 1.6% | |
| | |
Adobe, Inc. | | | | | | | | |
3.25%, 2/1/2025 | | | 200,000 | | | | 194,775 | |
2.15%, 2/1/2027 | | | 162,000 | | | | 146,467 | |
2.30%, 2/1/2030 | | | 223,000 | | | | 185,369 | |
| | |
Autodesk, Inc. | | | | | | | | |
3.50%, 6/15/2027 | | | 210,000 | | | | 194,179 | |
2.85%, 1/15/2030 | | | 30,000 | | | | 25,031 | |
2.40%, 12/15/2031 | | | 300,000 | | | | 230,467 | |
| | |
Fortinet, Inc. | | | | | | | | |
1.00%, 3/15/2026 | | | 50,000 | | | | 44,574 | |
2.20%, 3/15/2031 | | | 150,000 | | | | 114,375 | |
| | |
Intuit, Inc. | | | | | | | | |
1.35%, 7/15/2027 | | | 200,000 | | | | 172,637 | |
| | |
Oracle Corp. | | | | | | | | |
2.50%, 4/1/2025 | | | 100,000 | | | | 95,394 | |
4.65%, 5/6/2030 | | | 101,000 | | | | 92,593 | |
6.25%, 11/9/2032 | | | 150,000 | | | | 148,594 | |
See Accompanying Notes to the Financial Statements.
| | | | |
404 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Software – (continued) | |
| | |
Roper Technologies, Inc. | | | | | | | | |
1.00%, 9/15/2025 | | $ | 300,000 | | | $ | 274,789 | |
3.80%, 12/15/2026 | | | 50,000 | | | | 47,234 | |
1.40%, 9/15/2027 | | | 480,000 | | | | 406,221 | |
4.20%, 9/15/2028 | | | 301,000 | | | | 279,686 | |
2.95%, 9/15/2029 | | | 200,000 | | | | 170,379 | |
1.75%, 2/15/2031 | | | 252,000 | | | | 186,183 | |
| | |
ServiceNow, Inc. | | | | | | | | |
1.40%, 9/1/2030 | | | 250,000 | | | | 188,449 | |
| | |
VMware, Inc. | | | | | | | | |
4.50%, 5/15/2025 | | | 150,000 | | | | 146,498 | |
1.40%, 8/15/2026 | | | 353,000 | | | | 310,947 | |
4.65%, 5/15/2027 | | | 40,000 | | | | 38,315 | |
3.90%, 8/21/2027 | | | 200,000 | | | | 185,312 | |
1.80%, 8/15/2028 | | | 124,000 | | | | 102,350 | |
4.70%, 5/15/2030 | | | 192,000 | | | | 173,896 | |
2.20%, 8/15/2031 | | | 200,000 | | | | 147,853 | |
| | | | | | | 4,302,567 | |
|
Specialized REITs – 1.4% | |
| | |
American Tower Corp. | | | | | | | | |
REIT, 2.40%, 3/15/2025 | | | 163,000 | | | | 154,790 | |
| | |
Crown Castle, Inc. | | | | | | | | |
REIT, 1.05%, 7/15/2026 | | | 250,000 | | | | 218,566 | |
REIT, 3.10%, 11/15/2029 | | | 50,000 | | | | 41,574 | |
REIT, 2.25%, 1/15/2031 | | | 110,000 | | | | 82,899 | |
| | |
CubeSmart LP | | | | | | | | |
REIT, 4.00%, 11/15/2025 | | | 101,000 | | | | 96,656 | |
REIT, 2.25%, 12/15/2028 | | | 150,000 | | | | 123,914 | |
REIT, 4.38%, 2/15/2029 | | | 150,000 | | | | 136,766 | |
REIT, 3.00%, 2/15/2030 | | | 200,000 | | | | 163,621 | |
REIT, 2.00%, 2/15/2031 | | | 100,000 | | | | 73,977 | |
REIT, 2.50%, 2/15/2032 | | | 150,000 | | | | 111,207 | |
| | |
EPR Properties | | | | | | | | |
REIT, 4.50%, 6/1/2027 | | | 153,000 | | | | 135,037 | |
REIT, 4.95%, 4/15/2028 | | | 353,000 | | | | 307,599 | |
REIT, 3.75%, 8/15/2029 | | | 100,000 | | | | 78,896 | |
REIT, 3.60%, 11/15/2031 | | | 100,000 | | | | 71,981 | |
| | |
Equinix, Inc. | | | | | | | | |
REIT, 1.45%, 5/15/2026 | | | 200,000 | | | | 178,630 | |
REIT, 3.20%, 11/18/2029 | | | 252,000 | | | | 212,936 | |
| | |
Extra Space Storage LP | | | | | | | | |
REIT, 3.90%, 4/1/2029 | | | 100,000 | | | | 88,689 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Specialized REITs – (continued) | |
| | |
Public Storage Operating Co. | | | | | | | | |
REIT, 0.88%, 2/15/2026 | | $ | 300,000 | | | $ | 269,115 | |
REIT, 3.09%, 9/15/2027 | | | 102,000 | | | | 93,388 | |
REIT, 1.85%, 5/1/2028 | | | 100,000 | | | | 84,683 | |
REIT, 1.95%, 11/9/2028 | | | 81,000 | | | | 67,853 | |
| | |
Weyerhaeuser Co. | | | | | | | | |
REIT, 4.75%, 5/15/2026 | | | 250,000 | | | | 243,450 | |
REIT, 4.00%, 11/15/2029 | | | 101,000 | | | | 89,532 | |
REIT, 4.00%, 4/15/2030 | | | 504,000 | | | | 440,717 | |
REIT, 7.38%, 3/15/2032 | | | 150,000 | | | | 158,238 | |
REIT, 3.38%, 3/9/2033 | | | 150,000 | | | | 119,035 | |
| | | | | | | 3,843,749 | |
|
Specialty Retail – 2.6% | |
| | |
AutoNation, Inc. | | | | | | | | |
1.95%, 8/1/2028 | | | 50,000 | | | | 40,193 | |
| | |
AutoZone, Inc. | | | | | | | | |
3.25%, 4/15/2025 | | | 242,000 | | | | 233,129 | |
3.13%, 4/21/2026 | | | 25,000 | | | | 23,426 | |
3.75%, 6/1/2027 | | | 100,000 | | | | 93,452 | |
4.50%, 2/1/2028 | | | 200,000 | | | | 189,103 | |
3.75%, 4/18/2029 | | | 250,000 | | | | 223,325 | |
4.00%, 4/15/2030 | | | 150,000 | | | | 132,124 | |
1.65%, 1/15/2031 | | | 150,000 | | | | 109,929 | |
4.75%, 8/1/2032 | | | 140,000 | | | | 124,315 | |
4.75%, 2/1/2033 | | | 150,000 | | | | 132,316 | |
| | |
Best Buy Co., Inc. | | | | | | | | |
4.45%, 10/1/2028 | | | 51,000 | | | | 47,680 | |
| | |
Home Depot, Inc. (The) | | | | | | | | |
3.35%, 9/15/2025 | | | 300,000 | | | | 288,974 | |
2.13%, 9/15/2026 | | | 500,000 | | | | 457,763 | |
2.80%, 9/14/2027 | | | 353,000 | | | | 320,969 | |
3.90%, 12/6/2028 | | | 100,000 | | | | 93,096 | |
2.95%, 6/15/2029 | | | 151,000 | | | | 132,488 | |
2.70%, 4/15/2030 | | | 500,000 | | | | 418,650 | |
1.88%, 9/15/2031 | | | 200,000 | | | | 150,961 | |
3.25%, 4/15/2032 | | | 328,000 | | | | 273,083 | |
4.50%, 9/15/2032 | | | 350,000 | | | | 321,071 | |
| | |
Lowe's Cos., Inc. | | | | | | | | |
3.65%, 4/5/2029 | | | 252,000 | | | | 226,057 | |
4.50%, 4/15/2030 | | | 202,000 | | | | 184,774 | |
3.75%, 4/1/2032 | | | 202,000 | | | | 169,456 | |
| | |
O'Reilly Automotive, Inc. | | | | | | | | |
3.55%, 3/15/2026 | | | 252,000 | | | | 239,487 | |
3.60%, 9/1/2027 | | | 501,000 | | | | 464,714 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 405 | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Specialty Retail – (continued) | |
4.35%, 6/1/2028 | | $ | 200,000 | | | $ | 188,866 | |
4.20%, 4/1/2030 | | | 50,000 | | | | 44,771 | |
1.75%, 3/15/2031 | | | 100,000 | | | | 74,102 | |
4.70%, 6/15/2032 | | | 250,000 | | | | 223,908 | |
| | |
Ross Stores, Inc. | | | | | | | | |
0.88%, 4/15/2026 | | | 500,000 | | | | 442,692 | |
1.88%, 4/15/2031 | | | 150,000 | | | | 111,333 | |
| | |
TJX Cos., Inc. (The) | | | | | | | | |
2.25%, 9/15/2026 | | | 340,000 | | | | 312,159 | |
3.88%, 4/15/2030 | | | 281,000 | | | | 252,831 | |
| | |
Tractor Supply Co. | | | | | | | | |
1.75%, 11/1/2030 | | | 250,000 | | | | 185,204 | |
5.25%, 5/15/2033 | | | 150,000 | | | | 137,311 | |
| | | | | | | 7,063,712 | |
|
Technology Hardware, Storage & Peripherals – 2.0% | |
| | |
Apple, Inc. | | | | | | | | |
2.75%, 1/13/2025 | | | 101,000 | | | | 97,932 | |
2.50%, 2/9/2025 | | | 101,000 | | | | 97,500 | |
1.13%, 5/11/2025 | | | 454,000 | | | | 426,021 | |
3.20%, 5/13/2025 | | | 252,000 | | | | 244,112 | |
0.55%, 8/20/2025 | | | 50,000 | | | | 46,020 | |
3.25%, 2/23/2026 | | | 723,000 | | | | 691,963 | |
2.45%, 8/4/2026 | | | 352,000 | | | | 326,895 | |
2.05%, 9/11/2026 | | | 282,000 | | | | 258,545 | |
3.35%, 2/9/2027 | | | 212,000 | | | | 199,863 | |
3.20%, 5/11/2027 | | | 200,000 | | | | 187,012 | |
2.90%, 9/12/2027 | | | 182,000 | | | | 167,337 | |
3.00%, 11/13/2027 | | | 222,000 | | | | 204,109 | |
1.20%, 2/8/2028 | | | 414,000 | | | | 351,500 | |
1.40%, 8/5/2028 | | | 404,000 | | | | 340,063 | |
3.25%, 8/8/2029 | | | 182,000 | | | | 164,346 | |
2.20%, 9/11/2029 | | | 92,000 | | | | 77,871 | |
4.15%, 5/10/2030 | | | 50,000 | | | | 47,058 | |
1.65%, 2/8/2031 | | | 252,000 | | | | 196,084 | |
| | |
HP, Inc. | | | | | | | | |
3.00%, 6/17/2027 | | | 200,000 | | | | 180,137 | |
4.75%, 1/15/2028 | | | 250,000 | | | | 238,133 | |
4.00%, 4/15/2029 | | | 202,000 | | | | 182,603 | |
3.40%, 6/17/2030 | | | 100,000 | | | | 83,495 | |
5.50%, 1/15/2033 | | | 150,000 | | | | 137,708 | |
| | |
NetApp, Inc. | | | | | | | | |
1.88%, 6/22/2025 | | | 151,000 | | | | 141,323 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Technology Hardware, Storage & Peripherals – (continued) | |
2.38%, 6/22/2027 | | $ | 200,000 | | | $ | 177,533 | |
2.70%, 6/22/2030 | | | 150,000 | | | | 120,402 | |
| | |
Teledyne FLIR LLC | | | | | | | | |
2.50%, 8/1/2030 | | | 250,000 | | | | 196,676 | |
| | | | | | | 5,582,241 | |
|
Textiles, Apparel & Luxury Goods – 0.0%(d) | |
| | |
Tapestry, Inc. | | | | | | | | |
4.13%, 7/15/2027 | | | 8,000 | | | | 7,246 | |
3.05%, 3/15/2032 | | | 50,000 | | | | 35,874 | |
| | | | | | | 43,120 | |
|
Tobacco – 2.3% | |
| | |
Altria Group, Inc. | | | | | | | | |
2.35%, 5/6/2025 | | | 312,000 | | | | 295,690 | |
4.40%, 2/14/2026 | | | 301,000 | | | | 291,117 | |
2.63%, 9/16/2026 | | | 151,000 | | | | 138,616 | |
4.80%, 2/14/2029 | | | 654,000 | | | | 612,529 | |
3.40%, 5/6/2030 | | | 303,000 | | | | 253,407 | |
2.45%, 2/4/2032 | | | 500,000 | | | | 364,873 | |
| | |
BAT Capital Corp. | | | | | | | | |
3.22%, 9/6/2026 | | | 310,000 | | | | 287,098 | |
4.70%, 4/2/2027 | | | 163,000 | | | | 155,229 | |
3.56%, 8/15/2027 | | | 98,000 | | | | 88,842 | |
2.26%, 3/25/2028 | | | 181,000 | | | | 151,896 | |
4.91%, 4/2/2030 | | | 312,000 | | | | 281,311 | |
2.73%, 3/25/2031 | | | 127,000 | | | | 95,709 | |
| | |
Philip Morris International, Inc. | | | | | | | | |
1.50%, 5/1/2025 | | | 155,000 | | | | 145,609 | |
4.88%, 2/13/2026 | | | 251,000 | | | | 246,538 | |
2.75%, 2/25/2026 | | | 70,000 | | | | 65,568 | |
0.88%, 5/1/2026 | | | 111,000 | | | | 98,796 | |
5.13%, 11/17/2027 | | | 273,000 | | | | 266,110 | |
4.88%, 2/15/2028 | | | 493,000 | | | | 473,759 | |
3.38%, 8/15/2029 | | | 273,000 | | | | 237,609 | |
5.63%, 11/17/2029 | | | 300,000 | | | | 293,580 | |
5.13%, 2/15/2030 | | | 720,000 | | | | 678,284 | |
2.10%, 5/1/2030 | | | 250,000 | | | | 196,214 | |
5.75%, 11/17/2032 | | | 250,000 | | | | 238,850 | |
5.38%, 2/15/2033 | | | 300,000 | | | | 277,169 | |
5.63%, 9/7/2033 | | | 250,000 | | | | 234,701 | |
| | | | | | | 6,469,104 | |
See Accompanying Notes to the Financial Statements.
| | | | |
406 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Trading Companies & Distributors – 0.2% | |
| | |
Air Lease Corp. | | | | | | | | |
3.63%, 12/1/2027 | | $ | 202,000 | | | $ | 180,982 | |
3.13%, 12/1/2030 | | | 100,000 | | | | 79,612 | |
| | |
Aircastle Ltd. | | | | | | | | |
4.25%, 6/15/2026 | | | 252,000 | | | | 236,310 | |
| | | | | | | 496,904 | |
|
Water Utilities – 0.1% | |
| | |
American Water Capital Corp. | | | | | | | | |
3.45%, 6/1/2029 | | | 202,000 | | | | 179,077 | |
2.80%, 5/1/2030 | | | 100,000 | | | | 83,131 | |
| | |
Essential Utilities, Inc. | | | | | | | | |
2.70%, 4/15/2030 | | | 200,000 | | | | 161,519 | |
| | | | | | | 423,727 | |
|
Wireless Telecommunication Services – 0.0%(d) | |
| | |
T-Mobile USA, Inc. | | | | | | | | |
3.88%, 4/15/2030 | | | 100,000 | | | | 87,070 | |
Total Corporate Bonds (Cost $280,469,072) | | | | 265,621,732 | |
| | | | | | | | |
Total Investments – 96.7% (Cost $280,469,072) | | | | 265,621,732 | |
| |
Other assets less liabilities – 3.3% | | | | 8,928,007 | |
NET ASSETS – 100.0% | | | $ | 274,549,739 | |
(a) | Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2023. |
(b) | Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end. |
(c) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(d) | Represents less than 0.05% of net assets. |
Percentages shown are based on Net Assets.
Abbreviations
OYJ Public Limited Company
REIT Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 37,046 | |
Aggregate gross unrealized depreciation | | | (15,614,672 | ) |
Net unrealized depreciation | | $ | (15,577,626 | ) |
Federal income tax cost | | $ | 281,199,358 | |
| | | | |
Security Type | | % of Net Assets | |
Corporate Bonds | | | 96.7 | % |
Others(1) | | | 3.3 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 407 | |
Schedule of Investments
FlexShares® Credit-Scored US Long Corporate Bond Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 97.2% | |
|
Aerospace & Defense – 1.7% | |
| | |
Boeing Co. (The) | | | | | | | | |
5.93%, 5/1/2060 | | $ | 50,000 | | | $ | 42,065 | |
| | |
Howmet Aerospace, Inc. | | | | | | | | |
5.95%, 2/1/2037 | | | 50,000 | | | | 45,675 | |
| | |
Lockheed Martin Corp. | | | | | | | | |
4.50%, 5/15/2036 | | | 50,000 | | | | 43,785 | |
4.09%, 9/15/2052 | | | 125,000 | | | | 92,183 | |
4.15%, 6/15/2053 | | | 60,000 | | | | 44,626 | |
5.70%, 11/15/2054 | | | 50,000 | | | | 46,823 | |
5.20%, 2/15/2055 | | | 10,000 | | | | 8,719 | |
4.30%, 6/15/2062 | | | 10,000 | | | | 7,312 | |
5.90%, 11/15/2063 | | | 90,000 | | | | 86,022 | |
| | |
Precision Castparts Corp. | | | | | | | | |
4.20%, 6/15/2035 | | | 25,000 | | | | 20,960 | |
3.90%, 1/15/2043 | | | 50,000 | | | | 37,126 | |
| | |
RTX Corp. | | | | | | | | |
4.20%, 12/15/2044 | | | 10,000 | | | | 6,969 | |
| | | | | | | 482,265 | |
|
Air Freight & Logistics – 0.2% | |
| | |
FedEx Corp. | | | | | | | | |
4.50%, 2/1/2065 | | | 25,000 | | | | 16,679 | |
| | |
United Parcel Service, Inc. | | | | | | | | |
5.05%, 3/3/2053 | | | 50,000 | | | | 42,926 | |
| | | | | | | 59,605 | |
|
Automobile Components – 0.1% | |
| | |
Aptiv plc | | | | | | | | |
4.15%, 5/1/2052 | | | 25,000 | | | | 16,463 | |
| | |
Lear Corp. | | | | | | | | |
5.25%, 5/15/2049 | | | 25,000 | | | | 19,231 | |
| | | | | | | 35,694 | |
|
Banks – 6.3% | |
| | |
Bank of America Corp. | | | | | | | | |
7.75%, 5/14/2038 | | | 40,000 | | | | 42,864 | |
4.08%, 4/23/2040(a) | | | 25,000 | | | | 18,846 | |
2.68%, 6/19/2041(a) | | | 20,000 | | | | 12,194 | |
3.31%, 4/22/2042(a) | | | 15,000 | | | | 9,960 | |
3.95%, 1/23/2049(a) | | | 10,000 | | | | 6,966 | |
4.33%, 3/15/2050(a) | | | 20,000 | | | | 14,683 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – (continued) | |
4.08%, 3/20/2051(a) | | $ | 50,000 | | | $ | 35,055 | |
2.83%, 10/24/2051(a) | | | 10,000 | | | | 5,525 | |
| | |
Citigroup, Inc. | | | | | | | | |
5.32%, 3/26/2041(a) | | | 15,000 | | | | 12,950 | |
6.68%, 9/13/2043 | | | 75,000 | | | | 71,705 | |
5.30%, 5/6/2044 | | | 75,000 | | | | 61,128 | |
4.75%, 5/18/2046 | | | 200,000 | | | | 149,346 | |
| | |
Cooperatieve Rabobank UA | | | | | | | | |
5.25%, 5/24/2041 | | | 30,000 | | | | 27,434 | |
| | |
Fifth Third Bancorp | | | | | | | | |
8.25%, 3/1/2038 | | | 20,000 | | | | 20,347 | |
| | |
HSBC Holdings plc | | | | | | | | |
6.50%, 9/15/2037 | | | 100,000 | | | | 90,952 | |
6.80%, 6/1/2038 | | | 120,000 | | | | 113,861 | |
6.33%, 3/9/2044(a) | | | 70,000 | | | | 64,898 | |
| | |
JPMorgan Chase & Co. | | | | | | | | |
6.40%, 5/15/2038 | | | 35,000 | | | | 35,352 | |
3.16%, 4/22/2042(a) | | | 50,000 | | | | 32,938 | |
4.95%, 6/1/2045 | | | 75,000 | | | | 61,411 | |
| | |
Lloyds Banking Group plc | | | | | | | | |
4.34%, 1/9/2048 | | | 200,000 | | | | 130,499 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | | | | | | |
3.75%, 7/18/2039 | | | 10,000 | | | | 7,522 | |
| | |
Regions Financial Corp. | | | | | | | | |
7.38%, 12/10/2037 | | | 50,000 | | | | 47,825 | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | | | | | | |
2.93%, 9/17/2041 | | | 10,000 | | | | 6,229 | |
6.18%, 7/13/2043 | | | 10,000 | | | | 9,356 | |
| | |
Wells Fargo & Co. | | | | | | | | |
5.95%, 12/15/2036 | | | 15,000 | | | | 13,745 | |
3.07%, 4/30/2041(a) | | | 40,000 | | | | 25,560 | |
5.38%, 11/2/2043 | | | 100,000 | | | | 82,035 | |
5.61%, 1/15/2044 | | | 100,000 | | | | 84,280 | |
4.90%, 11/17/2045 | | | 150,000 | | | | 114,085 | |
4.40%, 6/14/2046 | | | 125,000 | | | | 87,435 | |
4.75%, 12/7/2046 | | | 125,000 | | | | 92,060 | |
5.01%, 4/4/2051(a) | | | 40,000 | | | | 31,722 | |
4.61%, 4/25/2053(a) | | | 50,000 | | | | 36,865 | |
| | |
Westpac Banking Corp. | | | | | | | | |
3.13%, 11/18/2041 | | | 250,000 | | | | 146,029 | |
| | | | | | | 1,803,662 | |
See Accompanying Notes to the Financial Statements.
| | | | |
408 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Beverages – 0.7% | |
| | |
Brown-Forman Corp. | | | | | | | | |
4.00%, 4/15/2038 | | $ | 50,000 | | | $ | 39,869 | |
| | |
Coca-Cola Co. (The) | | | | | | | | |
2.50%, 6/1/2040 | | | 10,000 | | | | 6,457 | |
2.50%, 3/15/2051 | | | 10,000 | | | | 5,516 | |
2.75%, 6/1/2060 | | | 10,000 | | | | 5,611 | |
| | |
Constellation Brands, Inc. | | | | | | | | |
5.25%, 11/15/2048 | | | 30,000 | | | | 25,075 | |
| | |
Diageo Investment Corp. | | | | | | | | |
4.25%, 5/11/2042 | | | 25,000 | | | | 19,545 | |
| | |
Keurig Dr Pepper, Inc. | | | | | | | | |
4.50%, 4/15/2052 | | | 40,000 | | | | 29,602 | |
| | |
PepsiCo, Inc. | | | | | | | | |
4.25%, 10/22/2044 | | | 25,000 | | | | 19,422 | |
4.65%, 2/15/2053 | | | 50,000 | | | | 41,948 | |
3.88%, 3/19/2060 | | | 20,000 | | | | 14,025 | |
| | | | | | | 207,070 | |
|
Biotechnology – 2.7% | |
| | |
AbbVie, Inc. | | | | | | | | |
4.55%, 3/15/2035 | | | 50,000 | | | | 43,958 | |
4.05%, 11/21/2039 | | | 25,000 | | | | 19,533 | |
4.40%, 11/6/2042 | | | 50,000 | | | | 39,707 | |
4.85%, 6/15/2044 | | | 100,000 | | | | 83,634 | |
4.75%, 3/15/2045 | | | 10,000 | | | | 8,196 | |
4.70%, 5/14/2045 | | | 100,000 | | | | 81,298 | |
4.88%, 11/14/2048 | | | 100,000 | | | | 82,799 | |
4.25%, 11/21/2049 | | | 150,000 | | | | 112,573 | |
| | |
Amgen, Inc. | | | | | | | | |
5.65%, 3/2/2053 | | | 30,000 | | | | 26,385 | |
4.40%, 2/22/2062 | | | 60,000 | | | | 41,509 | |
5.75%, 3/2/2063 | | | 30,000 | | | | 25,984 | |
| | |
Biogen, Inc. | | | | | | | | |
5.20%, 9/15/2045 | | | 100,000 | | | | 83,216 | |
3.15%, 5/1/2050 | | | 100,000 | | | | 57,589 | |
3.25%, 2/15/2051 | | | 50,000 | | | | 29,242 | |
| | |
Regeneron Pharmaceuticals, Inc. | | | | | | | | |
2.80%, 9/15/2050 | | | 50,000 | | | | 26,923 | |
| | | | | | | 762,546 | |
|
Broadline Retail – 0.4% | |
| | |
Alibaba Group Holding Ltd. | | | | | | | | |
3.15%, 2/9/2051 | | | 200,000 | | | | 108,291 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Building Products – 0.7% | |
| | |
Johnson Controls International plc | | | | | | | | |
4.50%, 2/15/2047 | | $ | 30,000 | | | $ | 22,716 | |
| | |
Masco Corp. | | | | | | | | |
4.50%, 5/15/2047 | | | 50,000 | | | | 35,616 | |
| | |
Owens Corning | | | | | | | | |
4.30%, 7/15/2047 | | | 40,000 | | | | 28,507 | |
4.40%, 1/30/2048 | | | 40,000 | | | | 28,754 | |
| | |
Trane Technologies Financing Ltd. | | | | | | | | |
4.50%, 3/21/2049 | | | 70,000 | | | | 53,045 | |
| | |
Trane Technologies Global Holding Co. Ltd. | | | | | | | | |
5.75%, 6/15/2043 | | | 30,000 | | | | 27,563 | |
| | | | | | | 196,201 | |
|
Capital Markets – 2.1% | |
| | |
Brookfield Finance LLC | | | | | | | | |
3.45%, 4/15/2050 | | | 25,000 | | | | 14,430 | |
| | |
CI Financial Corp. | | | | | | | | |
4.10%, 6/15/2051 | | | 20,000 | | | | 10,639 | |
| | |
Goldman Sachs Group, Inc. (The) | | | | | | | | |
6.75%, 10/1/2037 | | | 50,000 | | | | 48,843 | |
4.02%, 10/31/2038(a) | | | 30,000 | | | | 22,713 | |
3.21%, 4/22/2042(a) | | | 10,000 | | | | 6,490 | |
2.91%, 7/21/2042(a) | | | 15,000 | | | | 9,241 | |
3.44%, 2/24/2043(a) | | | 10,000 | | | | 6,606 | |
4.75%, 10/21/2045 | | | 50,000 | | | | 39,925 | |
| | |
Moody's Corp. | | | | | | | | |
2.75%, 8/19/2041 | | | 30,000 | | | | 18,512 | |
5.25%, 7/15/2044 | | | 25,000 | | | | 21,486 | |
4.88%, 12/17/2048 | | | 10,000 | | | | 8,048 | |
3.25%, 5/20/2050 | | | 10,000 | | | | 6,027 | |
2.55%, 8/18/2060 | | | 10,000 | | | | 4,575 | |
3.10%, 11/29/2061 | | | 70,000 | | | | 37,926 | |
| | |
Morgan Stanley | | | | | | | | |
3.22%, 4/22/2042(a) | | | 25,000 | | | | 16,521 | |
6.38%, 7/24/2042 | | | 20,000 | | | | 19,824 | |
4.30%, 1/27/2045 | | | 30,000 | | | | 22,548 | |
5.60%, 3/24/2051(a) | | | 25,000 | | | | 22,324 | |
| | |
Nasdaq, Inc. | | | | | | | | |
2.50%, 12/21/2040 | | | 10,000 | | | | 5,840 | |
3.25%, 4/28/2050 | | | 50,000 | | | | 29,307 | |
3.95%, 3/7/2052 | | | 30,000 | | | | 19,820 | |
5.95%, 8/15/2053 | | | 25,000 | | | | 22,304 | |
6.10%, 6/28/2063 | | | 60,000 | | | | 53,047 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 409 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Capital Markets – (continued) | |
| | |
S&P Global, Inc. | | | | | | | | |
6.55%, 11/15/2037 | | $ | 20,000 | | | $ | 19,790 | |
4.50%, 5/15/2048 | | | 20,000 | | | | 15,155 | |
3.25%, 12/1/2049 | | | 50,000 | | | | 31,154 | |
3.70%, 3/1/2052 | | | 75,000 | | | | 50,675 | |
3.90%, 3/1/2062 | | | 30,000 | | | | 20,180 | |
| | | | | | | 603,950 | |
|
Chemicals – 2.2% | |
| | |
Albemarle Corp. | | | | | | | | |
5.65%, 6/1/2052 | | | 25,000 | | | | 19,360 | |
| | |
CF Industries, Inc. | | | | | | | | |
5.15%, 3/15/2034 | | | 20,000 | | | | 17,723 | |
5.38%, 3/15/2044 | | | 50,000 | | | | 40,660 | |
| | |
Dow Chemical Co. (The) | | | | | | | | |
9.40%, 5/15/2039 | | | 10,000 | | | | 12,208 | |
5.55%, 11/30/2048 | | | 50,000 | | | | 42,203 | |
4.80%, 5/15/2049 | | | 10,000 | | | | 7,594 | |
6.90%, 5/15/2053 | | | 20,000 | | | | 19,993 | |
| | |
DuPont de Nemours, Inc. | | | | | | | | |
5.42%, 11/15/2048 | | | 25,000 | | | | 21,683 | |
| | |
FMC Corp. | | | | | | | | |
4.50%, 10/1/2049 | | | 25,000 | | | | 16,509 | |
| | |
Linde, Inc. | | | | | | | | |
3.55%, 11/7/2042 | | | 50,000 | | | | 35,721 | |
| | |
LYB International Finance BV | | | | | | | | |
5.25%, 7/15/2043 | | | 50,000 | | | | 40,237 | |
4.88%, 3/15/2044 | | | 50,000 | | | | 38,121 | |
| | |
LYB International Finance III LLC | | | | | | | | |
4.20%, 10/15/2049 | | | 80,000 | | | | 53,044 | |
4.20%, 5/1/2050 | | | 80,000 | | | | 52,925 | |
3.63%, 4/1/2051 | | | 110,000 | | | | 66,291 | |
3.80%, 10/1/2060 | | | 10,000 | | | | 5,775 | |
| | |
LyondellBasell Industries NV | | | | | | | | |
4.63%, 2/26/2055 | | | 50,000 | | | | 34,885 | |
| | |
Mosaic Co. (The) | | | | | | | | |
5.63%, 11/15/2043 | | | 20,000 | | | | 16,777 | |
| | |
RPM International, Inc. | | | | | | | | |
5.25%, 6/1/2045 | | | 20,000 | | | | 15,821 | |
4.25%, 1/15/2048 | | | 20,000 | | | | 13,674 | |
| | |
Sherwin-Williams Co. (The) | | | | | | | | |
3.30%, 5/15/2050 | | | 30,000 | | | | 18,004 | |
2.90%, 3/15/2052 | | | 50,000 | | | | 27,082 | |
| | | | | | | 616,290 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Commercial Services & Supplies – 0.4% | |
| | |
Republic Services, Inc. | | | | | | | | |
5.00%, 4/1/2034 | | $ | 50,000 | | | $ | 45,863 | |
5.70%, 5/15/2041 | | | 25,000 | | | | 23,351 | |
| | |
Waste Management, Inc. | | | | | | | | |
4.88%, 2/15/2034 | | | 10,000 | | | | 9,158 | |
2.95%, 6/1/2041 | | | 60,000 | | | | 39,217 | |
| | | | | | | 117,589 | |
|
Communications Equipment – 1.3% | |
| | |
Cisco Systems, Inc. | | | | | | | | |
5.90%, 2/15/2039 | | | 200,000 | | | | 198,899 | |
5.50%, 1/15/2040 | | | 100,000 | | | | 94,898 | |
| | |
Juniper Networks, Inc. | | | | | | | | |
5.95%, 3/15/2041 | | | 30,000 | | | | 26,071 | |
| | |
Motorola Solutions, Inc. | | | | | | | | |
5.50%, 9/1/2044 | | | 30,000 | | | | 25,172 | |
| | |
Nokia OYJ | | | | | | | | |
6.63%, 5/15/2039 | | | 25,000 | | | | 21,707 | |
| | | | | | | 366,747 | |
|
Construction & Engineering – 0.1% | |
| | |
Quanta Services, Inc. | | | | | | | | |
3.05%, 10/1/2041 | | | 20,000 | | | | 11,989 | |
| | |
Valmont Industries, Inc. | | | | | | | | |
5.00%, 10/1/2044 | | | 25,000 | | | | 19,234 | |
| | | | | | | 31,223 | |
|
Construction Materials – 0.2% | |
| | |
Lafarge SA | | | | | | | | |
7.13%, 7/15/2036 | | | 25,000 | | | | 25,704 | |
| | |
Vulcan Materials Co. | | | | | | | | |
4.50%, 6/15/2047 | | | 50,000 | | | | 38,153 | |
| | | | | | | 63,857 | |
|
Consumer Staples Distribution & Retail – 1.3% | |
| | |
Kroger Co. (The) | | | | | | | | |
6.90%, 4/15/2038 | | | 25,000 | | | | 25,440 | |
| | |
Sysco Corp. | | | | | | | | |
6.60%, 4/1/2040 | | | 35,000 | | | | 34,488 | |
4.85%, 10/1/2045 | | | 50,000 | | | | 38,680 | |
4.45%, 3/15/2048 | | | 50,000 | | | | 37,019 | |
6.60%, 4/1/2050 | | | 120,000 | | | | 118,387 | |
3.15%, 12/14/2051 | | | 20,000 | | | | 11,565 | |
See Accompanying Notes to the Financial Statements.
| | | | |
410 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Consumer Staples Distribution & Retail – (continued) | |
| | |
Walmart, Inc. | | | | | | | | |
6.50%, 8/15/2037 | | $ | 50,000 | | | $ | 53,751 | |
6.20%, 4/15/2038 | | | 25,000 | | | | 26,110 | |
4.50%, 9/9/2052 | | | 50,000 | | | | 40,567 | |
| | | | | | | 386,007 | |
|
Containers & Packaging – 0.1% | |
| | |
Packaging Corp. of America | | | | | | | | |
3.05%, 10/1/2051 | | | 75,000 | | | | 42,284 | |
|
Diversified REITs – 0.1% | |
| | |
VICI Properties LP | | | | | | | | |
REIT, 5.63%, 5/15/2052 | | | 50,000 | | | | 39,138 | |
|
Diversified Telecommunication Services – 0.6% | |
| | |
Bell Canada (The) | | | | | | | | |
4.46%, 4/1/2048 | | | 50,000 | | | | 36,928 | |
4.30%, 7/29/2049 | | | 15,000 | | | | 10,720 | |
3.65%, 8/15/2052 | | | 60,000 | | | | 37,997 | |
| | |
Telefonica Emisiones SA | | | | | | | | |
5.21%, 3/8/2047 | | | 20,000 | | | | 15,215 | |
| | |
TELUS Corp. | | | | | | | | |
4.30%, 6/15/2049 | | | 50,000 | | | | 35,024 | |
| | |
Verizon Communications, Inc. | | | | | | | | |
3.55%, 3/22/2051 | | | 50,000 | | | | 31,416 | |
| | | | | | | 167,300 | |
|
Electric Utilities – 3.0% | |
| | |
AEP Texas, Inc. | | | | | | | | |
5.25%, 5/15/2052 | | | 20,000 | | | | 16,184 | |
| | |
Arizona Public Service Co. | | | | | | | | |
4.70%, 1/15/2044 | | | 25,000 | | | | 18,260 | |
| | |
CenterPoint Energy Houston Electric LLC | | | | | | | | |
Series AH, 3.60%, 3/1/2052 | | | 30,000 | | | | 19,699 | |
| | |
Cleco Corporate Holdings LLC | | | | | | | | |
4.97%, 5/1/2046(b) | | | 10,000 | | | | 7,241 | |
| | |
Duke Energy Indiana LLC | | | | | | | | |
4.20%, 3/15/2042 | | | 25,000 | | | | 18,656 | |
Series YYY, 3.25%, 10/1/2049 | | | 25,000 | | | | 14,948 | |
5.40%, 4/1/2053 | | | 35,000 | | | | 30,013 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Electric Utilities – (continued) | |
| | |
Emera US Finance LP | | | | | | | | |
4.75%, 6/15/2046 | | $ | 30,000 | | | $ | 20,968 | |
| | |
Georgia Power Co. | | | | | | | | |
4.30%, 3/15/2042 | | | 50,000 | | | | 38,257 | |
| | |
Idaho Power Co. | | | | | | | | |
3.65%, 3/1/2045 | | | 25,000 | | | | 16,116 | |
5.50%, 3/15/2053 | | | 50,000 | | | | 43,708 | |
| | |
Interstate Power and Light Co. | | | | | | | | |
6.25%, 7/15/2039 | | | 25,000 | | | | 23,538 | |
4.70%, 10/15/2043 | | | 25,000 | | | | 18,832 | |
| | |
Kentucky Utilities Co. | | | | | | | | |
5.13%, 11/1/2040 | | | 50,000 | | | | 42,240 | |
| | |
MidAmerican Energy Co. | | | | | | | | |
4.25%, 7/15/2049 | | | 50,000 | | | | 36,926 | |
| | |
Oklahoma Gas and Electric Co. | | | | | | | | |
5.25%, 5/15/2041 | | | 25,000 | | | | 20,162 | |
3.85%, 8/15/2047 | | | 45,000 | | | | 30,253 | |
5.60%, 4/1/2053 | | | 30,000 | | | | 26,388 | |
| | |
Pacific Gas and Electric Co. | | | | | | | | |
4.95%, 7/1/2050 | | | 40,000 | | | | 27,921 | |
5.25%, 3/1/2052 | | | 50,000 | | | | 36,200 | |
6.70%, 4/1/2053 | | | 15,000 | | | | 13,286 | |
| | |
PacifiCorp | | | | | | | | |
6.25%, 10/15/2037 | | | 100,000 | | | | 94,919 | |
2.90%, 6/15/2052 | | | 50,000 | | | | 26,062 | |
5.35%, 12/1/2053 | | | 25,000 | | | | 19,885 | |
| | |
Public Service Co. of Colorado | | | | | | | | |
4.75%, 8/15/2041 | | | 25,000 | | | | 19,506 | |
| | |
Public Service Electric and Gas Co. | | | | | | | | |
5.38%, 11/1/2039 | | | 25,000 | | | | 21,853 | |
| | |
Southern Co. (The) | | | | | | | | |
4.40%, 7/1/2046 | | | 25,000 | | | | 18,441 | |
| | |
Tucson Electric Power Co. | | | | | | | | |
4.00%, 6/15/2050 | | | 60,000 | | | | 40,040 | |
| | |
Union Electric Co. | | | | | | | | |
2.63%, 3/15/2051 | | | 50,000 | | | | 26,517 | |
| | |
Wisconsin Public Service Corp. | | | | | | | | |
4.75%, 11/1/2044 | | | 25,000 | | | | 19,995 | |
3.30%, 9/1/2049 | | | 40,000 | | | | 24,427 | |
2.85%, 12/1/2051 | | | 50,000 | | | | 27,604 | |
| | | | | | | 859,045 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 411 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Electrical Equipment – 0.5% | |
| | |
ABB Finance USA, Inc. | | | | | | | | |
4.38%, 5/8/2042 | | $ | 50,000 | | | $ | 40,604 | |
| | |
Eaton Corp. | | | | | | | | |
4.70%, 8/23/2052 | | | 30,000 | | | | 24,350 | |
| | |
Emerson Electric Co. | | | | | | | | |
2.75%, 10/15/2050 | | | 25,000 | | | | 14,024 | |
2.80%, 12/21/2051 | | | 100,000 | | | | 56,632 | |
| | | | | | | 135,610 | |
|
Electronic Equipment, Instruments & Components – 0.7% | |
| | |
Corning, Inc. | | | | | | | | |
5.35%, 11/15/2048 | | | 50,000 | | | | 42,570 | |
4.38%, 11/15/2057 | | | 25,000 | | | | 17,765 | |
5.85%, 11/15/2068 | | | 25,000 | | | | 21,169 | |
5.45%, 11/15/2079 | | | 80,000 | | | | 63,096 | |
| | |
Tyco Electronics Group SA | | | | | | | | |
7.13%, 10/1/2037 | | | 40,000 | | | | 42,677 | |
| | | | | | | 187,277 | |
|
Entertainment – 0.3% | |
| | |
Activision Blizzard, Inc. | | | | | | | | |
2.50%, 9/15/2050 | | | 100,000 | | | | 55,902 | |
| | |
Electronic Arts, Inc. | | | | | | | | |
2.95%, 2/15/2051 | | | 50,000 | | | | 28,718 | |
| | | | | | | 84,620 | |
|
Financial Services – 2.4% | |
| | |
Fidelity National Information Services, Inc. | | | | | | | | |
5.63%, 7/15/2052 | | | 15,000 | | | | 12,717 | |
| | |
Fiserv, Inc. | | | | | | | | |
4.40%, 7/1/2049 | | | 140,000 | | | | 101,575 | |
| | |
Global Payments, Inc. | | | | | | | | |
4.15%, 8/15/2049 | | | 10,000 | | | | 6,484 | |
| | |
Mastercard, Inc. | | | | | | | | |
3.95%, 2/26/2048 | | | 30,000 | | | | 22,652 | |
3.65%, 6/1/2049 | | | 70,000 | | | | 49,506 | |
3.85%, 3/26/2050 | | | 100,000 | | | | 73,066 | |
2.95%, 3/15/2051 | | | 70,000 | | | | 42,714 | |
| | |
Shell International Finance BV | | | | | | | | |
6.38%, 12/15/2038 | | | 20,000 | | | | 20,444 | |
| | |
Visa, Inc. | | | | | | | | |
2.70%, 4/15/2040 | | | 80,000 | | | | 53,517 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Financial Services – (continued) | |
4.30%, 12/14/2045 | | $ | 300,000 | | | $ | 239,510 | |
| | |
Voya Financial, Inc. | | | | | | | | |
4.80%, 6/15/2046 | | | 25,000 | | | | 17,975 | |
| | |
Western Union Co. (The) | | | | | | | | |
6.20%, 6/21/2040 | | | 50,000 | | | | 44,938 | |
| | | | | | | 685,098 | |
|
Food Products – 1.4% | |
| | |
Campbell Soup Co. | | | | | | | | |
4.80%, 3/15/2048 | | | 30,000 | | | | 22,767 | |
| | |
Conagra Brands, Inc. | | | | | | | | |
5.40%, 11/1/2048 | | | 30,000 | | | | 24,011 | |
| | |
General Mills, Inc. | | | | | | | | |
5.40%, 6/15/2040 | | | 50,000 | | | | 43,834 | |
4.15%, 2/15/2043 | | | 25,000 | | | | 18,397 | |
| | |
Hershey Co. (The) | | | | | | | | |
3.13%, 11/15/2049 | | | 10,000 | | | | 6,187 | |
2.65%, 6/1/2050 | | | 60,000 | | | | 33,842 | |
| | |
Hormel Foods Corp. | | | | | | | | |
3.05%, 6/3/2051 | | | 20,000 | | | | 11,882 | |
| | |
Ingredion, Inc. | | | | | | | | |
3.90%, 6/1/2050 | | | 35,000 | | | | 22,098 | |
| | |
J M Smucker Co. (The) | | | | | | | | |
4.25%, 3/15/2035 | | | 15,000 | | | | 12,228 | |
2.75%, 9/15/2041 | | | 50,000 | | | | 29,757 | |
6.50%, 11/15/2053 | | | 90,000 | | | | 84,859 | |
| | |
JM Smucker Co. (The) | | | | | | | | |
3.55%, 3/15/2050 | | | 30,000 | | | | 18,168 | |
| | |
Kraft Heinz Foods Co. | | | | | | | | |
6.88%, 1/26/2039 | | | 25,000 | | | | 25,263 | |
| | |
Mead Johnson Nutrition Co. | | | | | | | | |
5.90%, 11/1/2039 | | | 25,000 | | | | 23,462 | |
4.60%, 6/1/2044 | | | 25,000 | | | | 19,872 | |
| | | | | | | 396,627 | |
|
Gas Utilities – 0.8% | |
| | |
Atmos Energy Corp. | | | | | | | | |
4.13%, 10/15/2044 | | | 55,000 | | | | 41,002 | |
2.85%, 2/15/2052 | | | 50,000 | | | | 28,148 | |
5.75%, 10/15/2052 | | | 40,000 | | | | 36,700 | |
6.20%, 11/15/2053 | | | 75,000 | | | | 72,790 | |
| | |
Southern California Gas Co. | | | | | | | | |
6.35%, 11/15/2052 | | | 40,000 | | | | 38,616 | |
| | | | | | | 217,256 | |
See Accompanying Notes to the Financial Statements.
| | | | |
412 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Ground Transportation – 3.3% | |
| | |
Burlington Northern Santa Fe LLC | | | | | | | | |
6.15%, 5/1/2037 | | $ | 25,000 | | | $ | 25,146 | |
5.75%, 5/1/2040 | | | 40,000 | | | | 38,129 | |
4.40%, 3/15/2042 | | | 75,000 | | | | 59,459 | |
4.45%, 3/15/2043 | | | 100,000 | | | | 79,171 | |
4.55%, 9/1/2044 | | | 25,000 | | | | 19,898 | |
4.15%, 12/15/2048 | | | 50,000 | | | | 36,687 | |
3.05%, 2/15/2051 | | | 110,000 | | | | 64,823 | |
3.30%, 9/15/2051 | | | 110,000 | | | | 68,565 | |
2.88%, 6/15/2052 | | | 90,000 | | | | 51,361 | |
4.45%, 1/15/2053 | | | 70,000 | | | | 54,191 | |
5.20%, 4/15/2054 | | | 80,000 | | | | 69,078 | |
| | |
Canadian National Railway Co. | | | | | | | | |
6.20%, 6/1/2036 | | | 50,000 | | | | 50,516 | |
4.45%, 1/20/2049 | | | 10,000 | | | | 7,745 | |
4.40%, 8/5/2052 | | | 45,000 | | | | 34,768 | |
| | |
Canadian Pacific Railway Co. | | | | | | | | |
6.13%, 9/15/2115 | | | 10,000 | | | | 9,000 | |
| | |
CSX Corp. | | | | | | | | |
6.15%, 5/1/2037 | | | 50,000 | | | | 49,861 | |
4.50%, 11/15/2052 | | | 45,000 | | | | 34,330 | |
4.50%, 8/1/2054 | | | 40,000 | | | | 30,240 | |
4.65%, 3/1/2068 | | | 25,000 | | | | 18,530 | |
| | |
Norfolk Southern Corp. | | | | | | | | |
5.10%, 8/1/2118 | | | 40,000 | | | | 29,364 | |
4.10%, 5/15/2121 | | | 15,000 | | | | 9,047 | |
| | |
Union Pacific Corp. | | | | | | | | |
3.84%, 3/20/2060 | | | 100,000 | | | | 65,863 | |
3.75%, 2/5/2070 | | | 80,000 | | | | 49,643 | |
| | | | | | | 955,415 | |
|
Health Care Equipment & Supplies – 0.4% | |
| | |
Abbott Laboratories | | | | | | | | |
5.30%, 5/27/2040 | | | 25,000 | | | | 23,427 | |
| | |
Boston Scientific Corp. | | | | | | | | |
4.55%, 3/1/2039 | | | 50,000 | | | | 41,391 | |
4.70%, 3/1/2049 | | | 10,000 | | | | 7,970 | |
| | |
Stryker Corp. | | | | | | | | |
4.10%, 4/1/2043 | | | 25,000 | | | | 18,763 | |
| | |
Zimmer Biomet Holdings, Inc. | | | | | | | | |
4.25%, 8/15/2035 | | | 25,000 | | | | 19,692 | |
| | | | | | | 111,243 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Health Care Providers & Services – 3.2% | |
| | |
Cardinal Health, Inc. | | | | | | | | |
4.60%, 3/15/2043 | | $ | 30,000 | | | $ | 22,725 | |
4.37%, 6/15/2047 | | | 110,000 | | | | 79,159 | |
| | |
Cencora, Inc. | | | | | | | | |
4.30%, 12/15/2047 | | | 75,000 | | | | 54,904 | |
| | |
Elevance Health, Inc. | | | | | | | | |
4.85%, 8/15/2054 | | | 25,000 | | | | 18,509 | |
| | |
HCA, Inc. | | | | | | | | |
5.25%, 6/15/2049 | | | 30,000 | | | | 23,060 | |
| | |
Humana, Inc. | | | | | | | | |
4.95%, 10/1/2044 | | | 50,000 | | | | 39,974 | |
5.50%, 3/15/2053 | | | 25,000 | | | | 21,533 | |
| | |
Laboratory Corp. of America Holdings | | | | | | | | |
4.70%, 2/1/2045 | | | 50,000 | | | | 38,797 | |
| | |
OhioHealth Corp. | | | | | | | | |
2.83%, 11/15/2041 | | | 10,000 | | | | 6,304 | |
Series 2020, 3.04%, 11/15/2050 | | | 20,000 | | | | 12,419 | |
| | |
Quest Diagnostics, Inc. | | | | | | | | |
4.70%, 3/30/2045 | | | 25,000 | | | | 19,607 | |
| | |
UnitedHealth Group, Inc. | | | | | | | | |
4.63%, 7/15/2035 | | | 25,000 | | | | 22,225 | |
6.63%, 11/15/2037 | | | 100,000 | | | | 104,319 | |
4.75%, 5/15/2052 | | | 30,000 | | | | 24,015 | |
5.88%, 2/15/2053 | | | 75,000 | | | | 70,927 | |
3.88%, 8/15/2059 | | | 100,000 | | | | 66,117 | |
3.13%, 5/15/2060 | | | 50,000 | | | | 28,453 | |
4.95%, 5/15/2062 | | | 75,000 | | | | 60,888 | |
6.05%, 2/15/2063 | | | 110,000 | | | | 104,826 | |
5.20%, 4/15/2063 | | | 100,000 | | | | 83,548 | |
| | | | | | | 902,309 | |
|
Hotels, Restaurants & Leisure – 2.1% | |
| | |
Darden Restaurants, Inc. | | | | | | | | |
4.55%, 2/15/2048 | | | 20,000 | | | | 14,565 | |
| | |
Marriott International, Inc. | | | | | | | | |
Series II, 2.75%, 10/15/2033 | | | 25,000 | | | | 18,308 | |
| | |
McDonald's Corp. | | | | | | | | |
4.70%, 12/9/2035 | | | 50,000 | | | | 43,871 | |
6.30%, 10/15/2037 | | | 50,000 | | | | 50,531 | |
5.70%, 2/1/2039 | | | 75,000 | | | | 70,598 | |
3.70%, 2/15/2042 | | | 100,000 | | | | 71,244 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 413 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
4.88%, 12/9/2045 | | $ | 65,000 | | | $ | 53,506 | |
4.45%, 3/1/2047 | | | 65,000 | | | | 49,872 | |
4.45%, 9/1/2048 | | | 70,000 | | | | 53,474 | |
3.63%, 9/1/2049 | | | 120,000 | | | | 79,534 | |
4.20%, 4/1/2050 | | | 50,000 | | | | 36,401 | |
5.15%, 9/9/2052 | | | 65,000 | | | | 54,795 | |
| | | | | | | 596,699 | |
|
Household Durables – 0.1% | |
| | |
MDC Holdings, Inc. | | | | | | | | |
6.00%, 1/15/2043 | | | 20,000 | | | | 15,711 | |
| | |
PulteGroup, Inc. | | | | | | | | |
6.00%, 2/15/2035 | | | 25,000 | | | | 23,262 | |
| | | | | | | 38,973 | |
|
Household Products – 0.6% | |
| | |
Church & Dwight Co., Inc. | | | | | | | | |
5.00%, 6/15/2052 | | | 50,000 | | | | 42,017 | |
| | |
Kimberly-Clark Corp. | | | | | | | | |
6.63%, 8/1/2037 | | | 100,000 | | | | 106,913 | |
3.90%, 5/4/2047 | | | 25,000 | | | | 18,135 | |
| | | | | | | 167,065 | |
|
Independent Power and Renewable Electricity Producers – 0.7% | |
| | |
Constellation Energy Generation LLC | | | | | | | | |
6.25%, 10/1/2039 | | | 50,000 | | | | 46,347 | |
6.50%, 10/1/2053 | | | 100,000 | | | | 93,924 | |
| | |
Southern Power Co. | | | | | | | | |
5.15%, 9/15/2041 | | | 25,000 | | | | 20,538 | |
5.25%, 7/15/2043 | | | 25,000 | | | | 20,161 | |
Series F, 4.95%, 12/15/2046 | | | 25,000 | | | | 19,106 | |
| | | | | | | 200,076 | |
|
Industrial Conglomerates – 0.2% | |
| | |
Honeywell International, Inc. | | | | | | | | |
5.70%, 3/15/2036 | | | 50,000 | | | | 48,801 | |
|
Insurance – 6.0% | |
| | |
Aflac, Inc. | | | | | | | | |
6.45%, 8/15/2040 | | | 20,000 | | | | 19,017 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Insurance – (continued) | |
4.00%, 10/15/2046 | | $ | 25,000 | | | $ | 17,296 | |
4.75%, 1/15/2049 | | | 50,000 | | | | 39,883 | |
| | |
Alleghany Corp. | | | | | | | | |
4.90%, 9/15/2044 | | | 50,000 | | | | 41,471 | |
3.25%, 8/15/2051 | | | 25,000 | | | | 15,308 | |
| | |
Allstate Corp. (The) | | | | | | | | |
3.85%, 8/10/2049 | | | 20,000 | | | | 13,189 | |
| | |
American Financial Group, Inc. | | | | | | | | |
4.50%, 6/15/2047 | | | 35,000 | | | | 25,080 | |
| | |
Aon Corp. | | | | | | | | |
3.90%, 2/28/2052 | | | 50,000 | | | | 33,618 | |
| | |
Aon Global Ltd. | | | | | | | | |
4.45%, 5/24/2043 | | | 50,000 | | | | 36,186 | |
4.60%, 6/14/2044 | | | 55,000 | | | | 42,878 | |
4.75%, 5/15/2045 | | | 80,000 | | | | 63,676 | |
| | |
Arch Capital Group Ltd. | | | | | | | | |
7.35%, 5/1/2034 | | | 20,000 | | | | 21,033 | |
3.64%, 6/30/2050 | | | 165,000 | | | | 104,834 | |
| | |
Arthur J Gallagher & Co. | | | | | | | | |
3.50%, 5/20/2051 | | | 70,000 | | | | 42,206 | |
3.05%, 3/9/2052 | | | 75,000 | | | | 40,685 | |
5.75%, 3/2/2053 | | | 10,000 | | | | 8,714 | |
| | |
Assurant, Inc. | | | | | | | | |
6.75%, 2/15/2034 | | | 25,000 | | | | 24,551 | |
| | |
Athene Holding Ltd. | | | | | | | | |
3.95%, 5/25/2051 | | | 50,000 | | | | 31,300 | |
3.45%, 5/15/2052 | | | 10,000 | | | | 5,647 | |
| | |
Berkshire Hathaway Finance Corp. | | | | | | | | |
2.85%, 10/15/2050 | | | 10,000 | | | | 5,745 | |
3.85%, 3/15/2052 | | | 190,000 | | | | 132,458 | |
| | |
Brown & Brown, Inc. | | | | | | | | |
4.95%, 3/17/2052 | | | 50,000 | | | | 37,097 | |
| | |
Chubb INA Holdings, Inc. | | | | | | | | |
3.05%, 12/15/2061 | | | 20,000 | | | | 11,253 | |
| | |
Cincinnati Financial Corp. | | | | | | | | |
6.13%, 11/1/2034 | | | 25,000 | | | | 23,688 | |
| | |
Everest Reinsurance Holdings, Inc. | | | | | | | | |
3.50%, 10/15/2050 | | | 10,000 | | | | 6,049 | |
3.13%, 10/15/2052 | | | 10,000 | | | | 5,619 | |
| | |
Fidelity National Financial, Inc. | | | | | | | | |
3.20%, 9/17/2051 | | | 20,000 | | | | 10,421 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | | | | | | |
6.63%, 3/30/2040 | | | 75,000 | | | | 73,246 | |
See Accompanying Notes to the Financial Statements.
| | | | |
414 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Insurance – (continued) | |
4.40%, 3/15/2048 | | $ | 10,000 | | | $ | 7,428 | |
2.90%, 9/15/2051 | | | 25,000 | | | | 13,768 | |
| | |
Markel Group, Inc. | | | | | | | | |
5.00%, 5/20/2049 | | | 25,000 | | | | 19,752 | |
4.15%, 9/17/2050 | | | 125,000 | | | | 84,626 | |
3.45%, 5/7/2052 | | | 50,000 | | | | 30,171 | |
| | |
Marsh & McLennan Cos., Inc. | | | | | | | | |
4.75%, 3/15/2039 | | | 25,000 | | | | 21,270 | |
4.90%, 3/15/2049 | | | 110,000 | | | | 90,423 | |
2.90%, 12/15/2051 | | | 10,000 | | | | 5,588 | |
6.25%, 11/1/2052 | | | 20,000 | | | | 19,568 | |
5.45%, 3/15/2053 | | | 50,000 | | | | 44,051 | |
5.70%, 9/15/2053 | | | 75,000 | | | | 68,853 | |
| | |
MetLife, Inc. | | | | | | | | |
10.75%, 8/1/2039 | | | 20,000 | | | | 25,243 | |
| | |
Old Republic International Corp. | | | | | | | | |
3.85%, 6/11/2051 | | | 50,000 | | | | 30,958 | |
| | |
Principal Financial Group, Inc. | | | | | | | | |
6.05%, 10/15/2036 | | | 35,000 | | | | 33,548 | |
5.50%, 3/15/2053 | | | 20,000 | | | | 16,688 | |
| | |
Prudential Financial, Inc. | | | | | | | | |
4.35%, 2/25/2050 | | | 50,000 | | | | 36,622 | |
| | |
Selective Insurance Group, Inc. | | | | | | | | |
5.38%, 3/1/2049 | | | 25,000 | | | | 20,357 | |
| | |
Travelers Cos., Inc. (The) | | | | | | | | |
2.55%, 4/27/2050 | | | 10,000 | | | | 5,444 | |
5.45%, 5/25/2053 | | | 10,000 | | | | 8,984 | |
| | |
Trinity Acquisition plc | | | | | | | | |
6.13%, 8/15/2043 | | | 25,000 | | | | 21,641 | |
| | |
Unum Group | | | | | | | | |
5.75%, 8/15/2042 | | | 25,000 | | | | 20,725 | |
4.13%, 6/15/2051 | | | 45,000 | | | | 28,039 | |
| | |
W R Berkley Corp. | | | | | | | | |
4.75%, 8/1/2044 | | | 25,000 | | | | 19,141 | |
4.00%, 5/12/2050 | | | 20,000 | | | | 13,402 | |
3.55%, 3/30/2052 | | | 70,000 | | | | 42,096 | |
3.15%, 9/30/2061 | | | 20,000 | | | | 10,379 | |
| | |
Willis North America, Inc. | | | | | | | | |
5.05%, 9/15/2048 | | | 50,000 | | | | 38,412 | |
| | | | | | | 1,709,325 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Interactive Media & Services – 1.9% | |
| | |
Alphabet, Inc. | | | | | | | | |
2.25%, 8/15/2060 | | $ | 45,000 | | | $ | 22,755 | |
| | |
Meta Platforms, Inc. | | | | | | | | |
4.45%, 8/15/2052 | | | 230,000 | | | | 173,893 | |
5.60%, 5/15/2053 | | | 110,000 | | | | 99,486 | |
4.65%, 8/15/2062 | | | 155,000 | | | | 116,880 | |
5.75%, 5/15/2063 | | | 135,000 | | | | 121,115 | |
| | | | | | | 534,129 | |
|
IT Services – 1.9% | |
| | |
International Business Machines Corp. | | | | | | | | |
4.15%, 5/15/2039 | | | 90,000 | | | | 70,654 | |
5.60%, 11/30/2039 | | | 50,000 | | | | 46,124 | |
4.00%, 6/20/2042 | | | 105,000 | | | | 78,075 | |
4.25%, 5/15/2049 | | | 270,000 | | | | 197,342 | |
2.95%, 5/15/2050 | | | 10,000 | | | | 5,675 | |
3.43%, 2/9/2052 | | | 10,000 | | | | 6,181 | |
4.90%, 7/27/2052 | | | 130,000 | | | | 104,442 | |
5.10%, 2/6/2053 | | | 20,000 | | | | 16,617 | |
7.13%, 12/1/2096 | | | 25,000 | | | | 26,270 | |
| | | | | | | 551,380 | |
|
Leisure Products – 0.0%(c) | |
| | |
Brunswick Corp. | | | | | | | | |
5.10%, 4/1/2052 | | | 15,000 | | | | 9,808 | |
|
Machinery – 0.8% | |
| | |
Dover Corp. | | | | | | | | |
5.38%, 10/15/2035 | | | 25,000 | | | | 23,397 | |
5.38%, 3/1/2041 | | | 50,000 | | | | 44,110 | |
| | |
Fortive Corp. | | | | | | | | |
4.30%, 6/15/2046 | | | 50,000 | | | | 36,288 | |
| | |
Otis Worldwide Corp. | | | | | | | | |
3.11%, 2/15/2040 | | | 50,000 | | | | 34,000 | |
3.36%, 2/15/2050 | | | 50,000 | | | | 31,468 | |
| | |
Snap-on, Inc. | | | | | | | | |
4.10%, 3/1/2048 | | | 25,000 | | | | 18,297 | |
3.10%, 5/1/2050 | | | 25,000 | | | | 15,303 | |
| | |
Xylem, Inc. | | | | | | | | |
4.38%, 11/1/2046 | | | 25,000 | | | | 17,945 | |
| | | | | | | 220,808 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 415 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Media – 3.0% | |
| | |
Charter Communications Operating LLC | | | | | | | | |
6.48%, 10/23/2045 | | $ | 110,000 | | | $ | 92,474 | |
5.38%, 5/1/2047 | | | 110,000 | | | | 79,557 | |
5.75%, 4/1/2048 | | | 100,000 | | | | 75,873 | |
4.80%, 3/1/2050 | | | 80,000 | | | | 52,735 | |
4.40%, 12/1/2061 | | | 75,000 | | | | 43,668 | |
5.50%, 4/1/2063 | | | 25,000 | | | | 17,577 | |
| | |
Comcast Corp. | | | | | | | | |
4.60%, 10/15/2038 | | | 40,000 | | | | 33,230 | |
3.75%, 4/1/2040 | | | 50,000 | | | | 36,745 | |
5.35%, 5/15/2053 | | | 40,000 | | | | 34,413 | |
2.94%, 11/1/2056 | | | 60,000 | | | | 31,788 | |
2.99%, 11/1/2063 | | | 65,000 | | | | 33,370 | |
| | |
Fox Corp. | | | | | | | | |
5.48%, 1/25/2039 | | | 100,000 | | | | 82,746 | |
5.58%, 1/25/2049 | | | 100,000 | | | | 78,786 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | | | | | | |
3.38%, 3/1/2041 | | | 20,000 | | | | 12,675 | |
5.40%, 10/1/2048 | | | 30,000 | | | | 24,167 | |
| | |
Time Warner Cable LLC | | | | | | | | |
7.30%, 7/1/2038 | | | 40,000 | | | | 37,276 | |
6.75%, 6/15/2039 | | | 60,000 | | | | 52,325 | |
5.88%, 11/15/2040 | | | 65,000 | | | | 51,278 | |
| | | | | | | 870,683 | |
|
Metals & Mining – 0.6% | |
| | |
ArcelorMittal SA | | | | | | | | |
6.75%, 3/1/2041(b) | | | 35,000 | | | | 31,821 | |
| | |
Freeport-McMoRan, Inc. | | | | | | | | |
5.45%, 3/15/2043 | | | 20,000 | | | | 16,450 | |
| | |
Reliance Steel & Aluminum Co. | | | | | | | | |
6.85%, 11/15/2036 | | | 25,000 | | | | 24,540 | |
| | |
Rio Tinto Alcan, Inc. | | | | | | | | |
5.75%, 6/1/2035 | | | 50,000 | | | | 47,450 | |
| | |
Steel Dynamics, Inc. | | | | | | | | |
3.25%, 10/15/2050 | | | 20,000 | | | | 11,367 | |
| | |
Vale Overseas Ltd. | | | | | | | | |
6.88%, 11/21/2036 | | | 50,000 | | | | 49,365 | |
| | | | | | | 180,993 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Multi-Utilities – 2.5% | |
| | |
Ameren Illinois Co. | | | | | | | | |
4.80%, 12/15/2043 | | $ | 25,000 | | | $ | 19,773 | |
| | |
Berkshire Hathaway Energy Co. | | | | | | | | |
6.13%, 4/1/2036 | | | 160,000 | | | | 155,676 | |
4.45%, 1/15/2049 | | | 100,000 | | | | 73,250 | |
4.25%, 10/15/2050 | | | 150,000 | | | | 105,000 | |
2.85%, 5/15/2051 | | | 50,000 | | | | 27,541 | |
4.60%, 5/1/2053 | | | 20,000 | | | | 14,818 | |
| | |
Consolidated Edison Co. of New York, Inc. | | | | | | | | |
Series 09-C, 5.50%, 12/1/2039 | | | 20,000 | | | | 17,688 | |
4.63%, 12/1/2054 | | | 20,000 | | | | 14,856 | |
Series C, 4.30%, 12/1/2056 | | | 25,000 | | | | 17,375 | |
4.50%, 5/15/2058 | | | 20,000 | | | | 14,312 | |
3.60%, 6/15/2061 | | | 20,000 | | | | 12,186 | |
| | |
Puget Sound Energy, Inc. | | | | | | | | |
5.80%, 3/15/2040 | | | 25,000 | | | | 22,725 | |
| | |
San Diego Gas & Electric Co. | | | | | | | | |
4.30%, 4/1/2042 | | | 20,000 | | | | 15,004 | |
2.95%, 8/15/2051 | | | 40,000 | | | | 22,738 | |
5.35%, 4/1/2053 | | | 40,000 | | | | 34,215 | |
| | |
Sempra | | | | | | | | |
3.80%, 2/1/2038 | | | 90,000 | | | | 67,111 | |
6.00%, 10/15/2039 | | | 20,000 | | | | 18,293 | |
4.00%, 2/1/2048 | | | 30,000 | | | | 20,482 | |
| | |
Southern Co. Gas Capital Corp. | | | | | | | | |
4.40%, 6/1/2043 | | | 25,000 | | | | 18,031 | |
4.40%, 5/30/2047 | | | 20,000 | | | | 14,406 | |
| | | | | | | 705,480 | |
|
Office REITs – 0.1% | |
| | |
Alexandria Real Estate Equities, Inc. | | | | | | | | |
REIT, 4.75%, 4/15/2035 | | | 20,000 | | | | 16,917 | |
| | |
Corporate Office Properties LP | | | | | | | | |
REIT, 2.90%, 12/1/2033 | | | 30,000 | | | | 20,379 | |
| | | | | | | 37,296 | |
|
Oil, Gas & Consumable Fuels – 17.2% | |
| | |
Canadian Natural Resources Ltd. | | | | | | | | |
6.50%, 2/15/2037 | | | 80,000 | | | | 75,986 | |
6.25%, 3/15/2038 | | | 50,000 | | | | 46,720 | |
6.75%, 2/1/2039 | | | 50,000 | | | | 48,146 | |
4.95%, 6/1/2047 | | | 35,000 | | | | 27,461 | |
See Accompanying Notes to the Financial Statements.
| | | | |
416 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Cenovus Energy, Inc. | | | | | | | | |
5.25%, 6/15/2037 | | $ | 50,000 | | | $ | 42,750 | |
6.75%, 11/15/2039 | | | 15,000 | | | | 14,498 | |
5.40%, 6/15/2047 | | | 12,000 | | | | 9,857 | |
3.75%, 2/15/2052 | | | 20,000 | | | | 12,504 | |
| | |
ConocoPhillips Co. | | | | | | | | |
3.80%, 3/15/2052 | | | 100,000 | | | | 68,119 | |
5.30%, 5/15/2053 | | | 50,000 | | | | 43,166 | |
5.55%, 3/15/2054 | | | 25,000 | | | | 22,347 | |
4.03%, 3/15/2062 | | | 130,000 | | | | 87,653 | |
5.70%, 9/15/2063 | | | 20,000 | | | | 17,847 | |
| | |
Continental Resources, Inc. | | | | | | | | |
4.90%, 6/1/2044 | | | 50,000 | | | | 35,305 | |
| | |
Devon Energy Corp. | | | | | | | | |
5.60%, 7/15/2041 | | | 50,000 | | | | 42,444 | |
5.00%, 6/15/2045 | | | 40,000 | | | | 30,821 | |
| | |
Diamondback Energy, Inc. | | | | | | | | |
4.40%, 3/24/2051 | | | 45,000 | | | | 31,931 | |
4.25%, 3/15/2052 | | | 30,000 | | | | 20,619 | |
6.25%, 3/15/2053 | | | 40,000 | | | | 36,910 | |
| | |
Eastern Gas Transmission & Storage, Inc. | | | | | | | | |
4.60%, 12/15/2044 | | | 50,000 | | | | 36,930 | |
| | |
Energy Transfer LP | | | | | | | | |
5.80%, 6/15/2038 | | | 50,000 | | | | 43,667 | |
7.50%, 7/1/2038 | | | 25,000 | | | | 25,554 | |
6.05%, 6/1/2041 | | | 40,000 | | | | 34,713 | |
6.50%, 2/1/2042 | | | 130,000 | | | | 120,174 | |
5.00%, 5/15/2044(b) | | | 40,000 | | | | 29,948 | |
6.13%, 12/15/2045 | | | 90,000 | | | | 77,763 | |
5.40%, 10/1/2047 | | | 50,000 | | | | 39,268 | |
6.00%, 6/15/2048 | | | 25,000 | | | | 21,256 | |
6.25%, 4/15/2049 | | | 100,000 | | | | 87,997 | |
5.00%, 5/15/2050 | | | 120,000 | | | | 89,974 | |
| | |
Enterprise Products Operating LLC | | | | | | | | |
7.55%, 4/15/2038 | | | 75,000 | | | | 81,783 | |
6.45%, 9/1/2040 | | | 25,000 | | | | 24,882 | |
5.95%, 2/1/2041 | | | 130,000 | | | | 123,261 | |
4.85%, 8/15/2042 | | | 25,000 | | | | 20,900 | |
4.45%, 2/15/2043 | | | 100,000 | | | | 78,956 | |
4.85%, 3/15/2044 | | | 100,000 | | | | 82,817 | |
4.25%, 2/15/2048 | | | 85,000 | | | | 63,604 | |
3.70%, 1/31/2051 | | | 75,000 | | | | 50,162 | |
3.95%, 1/31/2060 | | | 75,000 | | | | 50,224 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Exxon Mobil Corp. | | | | | | | | |
4.33%, 3/19/2050 | | $ | 10,000 | | | $ | 7,744 | |
3.45%, 4/15/2051 | | | 70,000 | | | | 45,997 | |
| | |
Kinder Morgan Energy Partners LP | | | | | | | | |
6.95%, 1/15/2038 | | | 100,000 | | | | 99,134 | |
6.50%, 9/1/2039 | | | 50,000 | | | | 46,375 | |
6.55%, 9/15/2040 | | | 50,000 | | | | 46,352 | |
6.38%, 3/1/2041 | | | 50,000 | | | | 45,557 | |
5.00%, 8/15/2042 | | | 50,000 | | | | 39,065 | |
5.50%, 3/1/2044 | | | 50,000 | | | | 40,730 | |
| | |
Kinder Morgan, Inc. | | | | | | | | |
5.30%, 12/1/2034 | | | 50,000 | | | | 44,245 | |
5.55%, 6/1/2045 | | | 75,000 | | | | 61,734 | |
5.05%, 2/15/2046 | | | 50,000 | | | | 38,135 | |
5.20%, 3/1/2048 | | | 50,000 | | | | 38,900 | |
3.25%, 8/1/2050 | | | 25,000 | | | | 14,146 | |
3.60%, 2/15/2051 | | | 50,000 | | | | 30,102 | |
5.45%, 8/1/2052 | | | 40,000 | | | | 32,331 | |
| | |
Magellan Midstream Partners LP | | | | | | | | |
5.15%, 10/15/2043 | | | 40,000 | | | | 31,747 | |
4.20%, 10/3/2047 | | | 85,000 | | | | 56,213 | |
4.85%, 2/1/2049 | | | 90,000 | | | | 66,597 | |
3.95%, 3/1/2050 | | | 40,000 | | | | 25,241 | |
| | |
Marathon Oil Corp. | | | | | | | | |
5.20%, 6/1/2045 | | | 15,000 | | | | 11,580 | |
| | |
Marathon Petroleum Corp. | | | | | | | | |
6.50%, 3/1/2041 | | | 50,000 | | | | 47,454 | |
5.85%, 12/15/2045 | | | 35,000 | | | | 29,230 | |
4.50%, 4/1/2048 | | | 65,000 | | | | 46,159 | |
| | |
MPLX LP | | | | | | | | |
4.50%, 4/15/2038 | | | 50,000 | | | | 38,953 | |
5.20%, 3/1/2047 | | | 25,000 | | | | 19,334 | |
4.70%, 4/15/2048 | | | 75,000 | | | | 54,217 | |
5.50%, 2/15/2049 | | | 80,000 | | | | 64,573 | |
4.95%, 3/14/2052 | | | 150,000 | | | | 111,166 | |
5.65%, 3/1/2053 | | | 100,000 | | | | 82,255 | |
4.90%, 4/15/2058 | | | 50,000 | | | | 35,196 | |
| | |
Occidental Petroleum Corp. | | | | | | | | |
6.45%, 9/15/2036 | | | 40,000 | | | | 38,851 | |
7.95%, 6/15/2039 | | | 30,000 | | | | 32,070 | |
6.20%, 3/15/2040 | | | 30,000 | | | | 27,816 | |
6.60%, 3/15/2046 | | | 60,000 | | | | 57,774 | |
4.20%, 3/15/2048 | | | 10,000 | | | | 6,741 | |
4.40%, 8/15/2049 | | | 25,000 | | | | 16,347 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 417 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
ONEOK Partners LP | | | | | | | | |
6.65%, 10/1/2036 | | $ | 50,000 | | | $ | 48,174 | |
6.85%, 10/15/2037 | | | 50,000 | | | | 48,823 | |
6.13%, 2/1/2041 | | | 40,000 | | | | 36,146 | |
| | |
ONEOK, Inc. | | | | | | | | |
4.95%, 7/13/2047 | | | 100,000 | | | | 74,640 | |
5.20%, 7/15/2048 | | | 120,000 | | | | 92,845 | |
4.45%, 9/1/2049 | | | 20,000 | | | | 13,696 | |
6.63%, 9/1/2053 | | | 125,000 | | | | 116,819 | |
| | |
Ovintiv, Inc. | | | | | | | | |
7.10%, 7/15/2053 | | | 15,000 | | | | 14,276 | |
| | |
Phillips 66 | | | | | | | | |
3.30%, 3/15/2052 | | | 25,000 | | | | 14,651 | |
| | |
Plains All American Pipeline LP | | | | | | | | |
6.65%, 1/15/2037 | | | 25,000 | | | | 23,636 | |
5.15%, 6/1/2042 | | | 100,000 | | | | 75,835 | |
4.70%, 6/15/2044 | | | 50,000 | | | | 35,007 | |
| | |
Suncor Energy, Inc. | | | | | | | | |
5.95%, 12/1/2034 | | | 25,000 | | | | 23,435 | |
6.80%, 5/15/2038 | | | 50,000 | | | | 49,164 | |
6.50%, 6/15/2038 | | | 30,000 | | | | 28,842 | |
6.85%, 6/1/2039 | | | 40,000 | | | | 38,916 | |
4.00%, 11/15/2047 | | | 50,000 | | | | 33,498 | |
3.75%, 3/4/2051 | | | 70,000 | | | | 44,475 | |
| | |
Targa Resources Corp. | | | | | | | | |
4.95%, 4/15/2052 | | | 20,000 | | | | 14,594 | |
6.25%, 7/1/2052 | | | 35,000 | | | | 30,591 | |
6.50%, 2/15/2053 | | | 20,000 | | | | 18,235 | |
| | |
TotalEnergies Capital International SA | | | | | | | | |
3.39%, 6/29/2060 | | | 50,000 | | | | 30,161 | |
| | |
Transcontinental Gas Pipe Line Co. LLC | | | | | | | | |
4.60%, 3/15/2048 | | | 50,000 | | | | 37,624 | |
| | |
Valero Energy Corp. | | | | | | | | |
4.90%, 3/15/2045 | | | 75,000 | | | | 58,890 | |
3.65%, 12/1/2051 | | | 25,000 | | | | 15,172 | |
4.00%, 6/1/2052 | | | 30,000 | | | | 19,497 | |
| | |
Western Midstream Operating LP | | | | | | | | |
5.45%, 4/1/2044 | | | 25,000 | | | | 19,241 | |
5.30%, 3/1/2048 | | | 60,000 | | | | 44,823 | |
5.25%, 2/1/2050(b)(d) | | | 100,000 | | | | 73,896 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Williams Cos., Inc. (The) | | | | | | | | |
6.30%, 4/15/2040 | | $ | 40,000 | | | $ | 37,766 | |
5.75%, 6/24/2044 | | | 50,000 | | | | 43,590 | |
4.90%, 1/15/2045 | | | 25,000 | | | | 19,175 | |
5.10%, 9/15/2045 | | | 90,000 | | | | 72,343 | |
4.85%, 3/1/2048 | | | 100,000 | | | | 76,566 | |
3.50%, 10/15/2051 | | | 50,000 | | | | 30,219 | |
5.30%, 8/15/2052 | | | 50,000 | | | | 40,651 | |
| | | | | | | 4,924,890 | |
|
Pharmaceuticals – 2.1% | |
| | |
Bristol-Myers Squibb Co. | | | | | | | | |
5.88%, 11/15/2036 | | | 25,000 | | | | 24,505 | |
4.13%, 6/15/2039 | | | 25,000 | | | | 19,854 | |
4.25%, 10/26/2049 | | | 10,000 | | | | 7,437 | |
3.70%, 3/15/2052 | | | 10,000 | | | | 6,713 | |
3.90%, 3/15/2062 | | | 100,000 | | | | 65,377 | |
| | |
Eli Lilly & Co. | | | | | | | | |
5.95%, 11/15/2037 | | | 25,000 | | | | 25,075 | |
4.88%, 2/27/2053 | | | 70,000 | | | | 60,667 | |
4.15%, 3/15/2059 | | | 60,000 | | | | 44,402 | |
2.50%, 9/15/2060 | | | 30,000 | | | | 15,245 | |
4.95%, 2/27/2063 | | | 50,000 | | | | 42,585 | |
| | |
GlaxoSmithKline Capital, Inc. | | | | | | | | |
6.38%, 5/15/2038 | | | 20,000 | | | | 20,817 | |
| | |
Johnson & Johnson | | | | | | | | |
2.45%, 9/1/2060 | | | 50,000 | | | | 25,661 | |
| | |
Merck & Co., Inc. | | | | | | | | |
2.75%, 12/10/2051 | | | 55,000 | | | | 31,058 | |
5.00%, 5/17/2053 | | | 50,000 | | | | 42,698 | |
2.90%, 12/10/2061 | | | 25,000 | | | | 13,443 | |
5.15%, 5/17/2063 | | | 50,000 | | | | 42,605 | |
| | |
Zoetis, Inc. | | | | | | | | |
4.70%, 2/1/2043 | | | 75,000 | | | | 61,583 | |
3.95%, 9/12/2047 | | | 25,000 | | | | 17,881 | |
4.45%, 8/20/2048 | | | 50,000 | | | | 38,471 | |
| | | | | | | 606,077 | |
|
Professional Services – 0.2% | |
| | |
Verisk Analytics, Inc. | | | | | | | | |
5.50%, 6/15/2045 | | | 25,000 | | | | 21,152 | |
3.63%, 5/15/2050 | | | 50,000 | | | | 31,948 | |
| | | | | | | 53,100 | |
See Accompanying Notes to the Financial Statements.
| | | | |
418 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Real Estate Management & Development – 0.2% | |
| | |
CBRE Services, Inc. | | | | | | | | |
5.95%, 8/15/2034 | | $ | 55,000 | | | $ | 50,005 | |
|
Residential REITs – 0.1% | |
| | |
ERP Operating LP | | | | | | | | |
REIT, 4.50%, 6/1/2045 | | | 25,000 | | | | 18,168 | |
| | |
Essex Portfolio LP | | | | | | | | |
REIT, 4.50%, 3/15/2048 | | | 20,000 | | | | 14,436 | |
REIT, 2.65%, 9/1/2050 | | | 20,000 | | | | 9,797 | |
| | | | | | | 42,401 | |
|
Retail REITs – 0.3% | |
| | |
NNN REIT, Inc. | | | | | | | | |
REIT, 3.50%, 4/15/2051 | | | 54,000 | | | | 32,300 | |
REIT, 3.00%, 4/15/2052 | | | 40,000 | | | | 21,345 | |
| | |
Regency Centers LP | | | | | | | | |
REIT, 4.40%, 2/1/2047 | | | 60,000 | | | | 41,963 | |
| | | | | | | 95,608 | |
|
Semiconductors & Semiconductor Equipment – 5.1% | |
| | |
Advanced Micro Devices, Inc. | | | | | | | | |
4.39%, 6/1/2052 | | | 25,000 | | | | 19,258 | |
| | |
Analog Devices, Inc. | | | | | | | | |
2.80%, 10/1/2041 | | | 40,000 | | | | 25,370 | |
2.95%, 10/1/2051 | | | 50,000 | | | | 29,294 | |
| | |
Applied Materials, Inc. | | | | | | | | |
5.10%, 10/1/2035 | | | 50,000 | | | | 47,381 | |
| | |
Broadcom, Inc. | | | | | | | | |
3.47%, 4/15/2034(e) | | | 160,000 | | | | 121,910 | |
3.14%, 11/15/2035(e) | | | 210,000 | | | | 148,134 | |
3.19%, 11/15/2036(e) | | | 120,000 | | | | 83,107 | |
3.50%, 2/15/2041(e) | | | 185,000 | | | | 123,040 | |
3.75%, 2/15/2051(e) | | | 130,000 | | | | 82,892 | |
| | |
KLA Corp. | | | | | | | | |
5.65%, 11/1/2034 | | | 25,000 | | | | 24,101 | |
5.00%, 3/15/2049 | | | 20,000 | | | | 16,611 | |
4.95%, 7/15/2052 | | | 75,000 | | | | 62,838 | |
5.25%, 7/15/2062 | | | 80,000 | | | | 67,795 | |
| | |
Lam Research Corp. | | | | | | | | |
4.88%, 3/15/2049 | | | 30,000 | | | | 24,745 | |
3.13%, 6/15/2060 | | | 70,000 | | | | 38,891 | |
| | |
Micron Technology, Inc. | | | | | | | | |
3.37%, 11/1/2041 | | | 50,000 | | | | 31,510 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Semiconductors & Semiconductor Equipment – (continued) | |
| | |
NVIDIA Corp. | | | | | | | | |
3.50%, 4/1/2040 | | $ | 10,000 | | | $ | 7,486 | |
3.70%, 4/1/2060 | | | 20,000 | | | | 13,452 | |
| | |
NXP BV | | | | | | | | |
3.25%, 5/11/2041 | | | 70,000 | | | | 44,923 | |
3.13%, 2/15/2042 | | | 50,000 | | | | 30,985 | |
3.25%, 11/30/2051 | | | 20,000 | | | | 11,322 | |
| | |
QUALCOMM, Inc. | | | | | | | | |
4.50%, 5/20/2052 | | | 50,000 | | | | 38,435 | |
6.00%, 5/20/2053 | | | 110,000 | | | | 105,860 | |
| | |
Texas Instruments, Inc. | | | | | | | | |
3.88%, 3/15/2039 | | | 40,000 | | | | 31,794 | |
4.15%, 5/15/2048 | | | 75,000 | | | | 56,771 | |
2.70%, 9/15/2051 | | | 20,000 | | | | 11,283 | |
4.10%, 8/16/2052 | | | 10,000 | | | | 7,362 | |
5.00%, 3/14/2053 | | | 70,000 | | | | 59,608 | |
5.05%, 5/18/2063 | | | 100,000 | | | | 83,269 | |
| | |
TSMC Arizona Corp. | | | | | | | | |
4.50%, 4/22/2052 | | | 10,000 | | | | 8,200 | |
| | | | | | | 1,457,627 | |
|
Software – 3.2% | |
| | |
Intuit, Inc. | | | | | | | | |
5.50%, 9/15/2053 | | | 100,000 | | | | 90,970 | |
| | |
Microsoft Corp. | | | | | | | | |
2.53%, 6/1/2050 | | | 20,000 | | | | 11,448 | |
2.92%, 3/17/2052 | | | 100,000 | | | | 61,731 | |
4.50%, 2/6/2057 | | | 30,000 | | | | 24,764 | |
2.68%, 6/1/2060 | | | 40,000 | | | | 22,118 | |
3.04%, 3/17/2062 | | | 210,000 | | | | 124,698 | |
| | |
Oracle Corp. | | | | | | | | |
3.80%, 11/15/2037 | | | 25,000 | | | | 18,397 | |
6.13%, 7/8/2039 | | | 105,000 | | | | 98,116 | |
3.65%, 3/25/2041 | | | 140,000 | | | | 95,335 | |
4.13%, 5/15/2045 | | | 200,000 | | | | 138,541 | |
3.60%, 4/1/2050 | | | 200,000 | | | | 122,554 | |
4.38%, 5/15/2055 | | | 39,000 | | | | 26,387 | |
3.85%, 4/1/2060 | | | 95,000 | | | | 57,019 | |
| | |
Salesforce, Inc. | | | | | | | | |
3.05%, 7/15/2061 | | | 25,000 | | | | 13,924 | |
| | | | | | | 906,002 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 419 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Specialized REITs – 0.1% | |
| | |
Weyerhaeuser Co. | | | | | | | | |
REIT, 6.88%, 12/15/2033 | | $ | 25,000 | | | $ | 25,360 | |
REIT, 4.00%, 3/9/2052 | | | 15,000 | | | | 10,233 | |
| | | | | | | 35,593 | |
|
Specialty Retail – 3.6% | |
| | |
Dick's Sporting Goods, Inc. | | | | | | | | |
4.10%, 1/15/2052 | | | 25,000 | | | | 14,625 | |
| | |
Home Depot, Inc. (The) | | | | | | | | |
5.88%, 12/16/2036 | | | 40,000 | | | | 39,613 | |
3.30%, 4/15/2040 | | | 130,000 | | | | 91,913 | |
5.95%, 4/1/2041 | | | 50,000 | | | | 48,484 | |
4.50%, 12/6/2048 | | | 20,000 | | | | 15,762 | |
3.13%, 12/15/2049 | | | 20,000 | | | | 12,168 | |
3.35%, 4/15/2050 | | | 100,000 | | | | 63,372 | |
2.38%, 3/15/2051 | | | 10,000 | | | | 5,107 | |
2.75%, 9/15/2051 | | | 60,000 | | | | 33,428 | |
3.63%, 4/15/2052 | | | 175,000 | | | | 116,543 | |
4.95%, 9/15/2052 | | | 150,000 | | | | 126,256 | |
| | |
Lowe's Cos., Inc. | | | | | | | | |
2.80%, 9/15/2041 | | | 25,000 | | | | 15,185 | |
4.05%, 5/3/2047 | | | 50,000 | | | | 34,501 | |
4.55%, 4/5/2049 | | | 25,000 | | | | 18,412 | |
5.13%, 4/15/2050 | | | 40,000 | | | | 32,329 | |
3.00%, 10/15/2050 | | | 90,000 | | | | 49,466 | |
4.25%, 4/1/2052 | | | 50,000 | | | | 34,653 | |
5.63%, 4/15/2053 | | | 90,000 | | | | 77,772 | |
5.75%, 7/1/2053 | | | 75,000 | | | | 65,810 | |
4.45%, 4/1/2062 | | | 75,000 | | | | 51,208 | |
5.80%, 9/15/2062 | | | 50,000 | | | | 42,366 | |
5.85%, 4/1/2063 | | | 40,000 | | | | 34,127 | |
| | |
TJX Cos., Inc. (The) | | | | | | | | |
4.50%, 4/15/2050 | | | 25,000 | | | | 19,748 | |
| | | | | | | 1,042,848 | |
|
Technology Hardware, Storage & Peripherals – 2.7% | |
| | |
Apple, Inc. | | | | | | | | |
4.38%, 5/13/2045 | | | 50,000 | | | | 40,995 | |
4.65%, 2/23/2046 | | | 190,000 | | | | 162,099 | |
2.70%, 8/5/2051 | | | 200,000 | | | | 115,663 | |
3.95%, 8/8/2052 | | | 100,000 | | | | 74,139 | |
2.55%, 8/20/2060 | | | 50,000 | | | | 27,386 | |
2.80%, 2/8/2061 | | | 100,000 | | | | 55,221 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Technology Hardware, Storage & Peripherals – (continued) | |
2.85%, 8/5/2061 | | $ | 100,000 | | | $ | 55,590 | |
4.10%, 8/8/2062 | | | 70,000 | | | | 51,331 | |
| | |
Dell International LLC | | | | | | | | |
8.10%, 7/15/2036 | | | 70,000 | | | | 75,918 | |
3.38%, 12/15/2041 | | | 10,000 | | | | 6,442 | |
8.35%, 7/15/2046 | | | 20,000 | | | | 22,343 | |
| | |
HP, Inc. | | | | | | | | |
6.00%, 9/15/2041 | | | 80,000 | | | | 72,447 | |
| | | | | | | 759,574 | |
|
Tobacco – 3.9% | |
| | |
Altria Group, Inc. | | | | | | | | |
5.80%, 2/14/2039 | | | 100,000 | | | | 88,887 | |
3.40%, 2/4/2041 | | | 40,000 | | | | 24,512 | |
4.25%, 8/9/2042 | | | 120,000 | | | | 82,134 | |
4.50%, 5/2/2043 | | | 65,000 | | | | 45,884 | |
5.38%, 1/31/2044 | | | 125,000 | | | | 107,253 | |
5.95%, 2/14/2049 | | | 245,000 | | | | 207,839 | |
3.70%, 2/4/2051 | | | 10,000 | | | | 5,826 | |
| | |
BAT Capital Corp. | | | | | | | | |
4.39%, 8/15/2037 | | | 50,000 | | | | 36,340 | |
4.54%, 8/15/2047 | | | 50,000 | | | | 32,348 | |
4.76%, 9/6/2049 | | | 25,000 | | | | 16,620 | |
5.28%, 4/2/2050 | | | 50,000 | | | | 35,559 | |
5.65%, 3/16/2052 | | | 50,000 | | | | 37,603 | |
7.08%, 8/2/2053 | | | 50,000 | | | | 44,626 | |
| | |
Philip Morris International, Inc. | | | | | | | | |
6.38%, 5/16/2038 | | | 75,000 | | | | 74,239 | |
4.38%, 11/15/2041 | | | 50,000 | | | | 37,593 | |
4.50%, 3/20/2042 | | | 50,000 | | | | 38,247 | |
4.13%, 3/4/2043 | | | 80,000 | | | | 57,331 | |
4.88%, 11/15/2043 | | | 40,000 | | | | 31,875 | |
4.25%, 11/10/2044 | | | 50,000 | | | | 36,060 | |
| | |
Reynolds American, Inc. | | | | | | | | |
5.70%, 8/15/2035 | | | 25,000 | | | | 21,420 | |
5.85%, 8/15/2045 | | | 50,000 | | | | 39,086 | |
| | | | | | | 1,101,282 | |
|
Trading Companies & Distributors – 0.3% | |
| | |
WW Grainger, Inc. | | | | | | | | |
4.60%, 6/15/2045 | | | 50,000 | | | | 40,497 | |
4.20%, 5/15/2047 | | | 50,000 | | | | 38,815 | |
| | | | | | | 79,312 | |
See Accompanying Notes to the Financial Statements.
| | | | |
420 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Water Utilities – 0.3% | |
| | |
American Water Capital Corp. | | | | | | | | |
3.45%, 5/1/2050 | | $ | 30,000 | | | $ | 19,172 | |
3.25%, 6/1/2051 | | | 30,000 | | | | 18,491 | |
| | |
Essential Utilities, Inc. | | | | | | | | |
5.30%, 5/1/2052 | | | 50,000 | | | | 40,371 | |
| | | | | | | 78,034 | |
|
Wireless Telecommunication Services – 0.2% | |
| | |
Rogers Communications, Inc. | | | | | | | | |
7.50%, 8/15/2038 | | | 10,000 | | | | 9,918 | |
| | |
T-Mobile USA, Inc. | | | | | | | | |
4.50%, 4/15/2050 | | | 20,000 | | | | 14,591 | |
5.75%, 1/15/2054 | | | 20,000 | | | | 17,557 | |
5.80%, 9/15/2062 | | | 20,000 | | | | 17,235 | |
| | | | 59,301 | |
Total Corporate Bonds (Cost $34,128,436) | | | | 27,787,389 | |
| | | | | | | | |
Total Investments – 97.2% (Cost $34,128,436) | | | | 27,787,389 | |
| |
Other assets less liabilities – 2.8% | | | | 788,075 | |
NET ASSETS – 100.0% | | | $ | 28,575,464 | |
(a) | Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end. |
(b) | Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2023. |
(c) | Represents less than 0.05% of net assets. |
(d) | Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2023. |
(e) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
Percentages shown are based on Net Assets.
Abbreviations
OYJ Public Limited Company
REIT Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | — | |
Aggregate gross unrealized depreciation | | | (6,495,514 | ) |
Net unrealized depreciation | | $ | (6,495,514 | ) |
Federal income tax cost | | $ | 34,282,903 | |
| | | | |
Security Type | | % of Net Assets | |
Corporate Bonds | | | 97.2 | % |
Others(1) | | | 2.8 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 421 | |
Schedule of Investments
FlexShares® High Yield Value-Scored Bond Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 98.1% | |
|
Aerospace & Defense – 2.6% | |
| | |
Bombardier, Inc. | | | | | | | | |
7.13%, 6/15/2026(a) | | $ | 2,675,000 | | | $ | 2,573,848 | |
7.88%, 4/15/2027(a) | | | 1,750,000 | | | | 1,683,453 | |
6.00%, 2/15/2028(a) | | | 500,000 | | | | 442,439 | |
7.50%, 2/1/2029(a) | | | 450,000 | | | | 416,818 | |
| | |
BWX Technologies, Inc. | | | | | | | | |
4.13%, 6/30/2028(a) | | | 790,000 | | | | 695,188 | |
4.13%, 4/15/2029(a) | | | 859,000 | | | | 734,445 | |
| | |
F-Brasile SpA | | | | | | | | |
Series NR, 7.38%, 8/15/2026(a) | | | 1,650,000 | | | | 1,532,860 | |
| | |
Spirit AeroSystems, Inc. | | | | | | | | |
4.60%, 6/15/2028 | | | 500,000 | | | | 395,578 | |
| | |
TransDigm, Inc. | | | | | | | | |
6.25%, 3/15/2026(a) | | | 4,305,000 | | | | 4,203,659 | |
5.50%, 11/15/2027 | | | 5,580,000 | | | | 5,194,726 | |
6.75%, 8/15/2028(a) | | | 4,425,000 | | | | 4,296,601 | |
4.63%, 1/15/2029 | | | 3,665,000 | | | | 3,160,110 | |
4.88%, 5/1/2029 | | | 2,401,000 | | | | 2,080,186 | |
6.88%, 12/15/2030(a) | | | 300,000 | | | | 289,668 | |
| | |
Triumph Group, Inc. | | | | | | | | |
7.75%, 8/15/2025 | | | 2,300,000 | | | | 2,185,000 | |
9.00%, 3/15/2028(a) | | | 2,270,000 | | | | 2,204,711 | |
| | | | | | | 32,089,290 | |
|
Air Freight & Logistics – 0.7% | |
| | |
Forward Air Corp. | | | | | | | | |
9.50%, 10/15/2031(a) | | | 4,000,000 | | | | 3,900,000 | |
| | |
Rand Parent LLC | | | | | | | | |
8.50%, 2/15/2030(a) | | | 4,480,000 | | | | 4,091,119 | |
| | | | | | | 7,991,119 | |
|
Automobile Components – 2.8% | |
| | |
Adient Global Holdings Ltd. | | | | | | | | |
8.25%, 4/15/2031(a) | | | 350,000 | | | | 340,646 | |
| | |
Allison Transmission, Inc. | | | | | | | | |
3.75%, 1/30/2031(a) | | | 803,000 | | | | 636,472 | |
| | |
American Axle & Manufacturing, Inc. | | | | | | | | |
6.50%, 4/1/2027 | | | 1,230,000 | | | | 1,159,415 | |
6.88%, 7/1/2028 | | | 950,000 | | | | 846,726 | |
5.00%, 10/1/2029 | | | 180,000 | | | | 142,185 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Automobile Components – (continued) | |
| | |
Clarios Global LP | | | | | | | | |
8.50%, 5/15/2027(a) | | $ | 500,000 | | | $ | 492,287 | |
| | |
Dana, Inc. | | | | | | | | |
4.25%, 9/1/2030 | | | 150,000 | | | | 118,722 | |
| | |
Icahn Enterprises LP | | | | | | | | |
6.38%, 12/15/2025 | | | 2,160,000 | | | | 2,032,017 | |
6.25%, 5/15/2026 | | | 6,350,000 | | | | 5,804,355 | |
5.25%, 5/15/2027 | | | 7,390,000 | | | | 6,327,688 | |
4.38%, 2/1/2029 | | | 1,585,000 | | | | 1,220,494 | |
| | |
IHO Verwaltungs GmbH | | | | | | | | |
4.75%, 9/15/2026(a)(b) | | | 735,000 | | | | 683,057 | |
6.00%, 5/15/2027(a)(b) | | | 565,000 | | | | 525,738 | |
6.37%, 5/15/2029(a)(b) | | | 2,385,000 | | | | 2,076,391 | |
| | |
JB Poindexter & Co., Inc. | | | | | | | | |
7.13%, 4/15/2026(a) | | | 1,190,000 | | | | 1,134,679 | |
| | |
Patrick Industries, Inc. | | | | | | | | |
7.50%, 10/15/2027(a) | | | 1,535,000 | | | | 1,462,088 | |
4.75%, 5/1/2029(a) | | | 1,170,000 | | | | 949,437 | |
| | |
Tenneco, Inc. | | | | | | | | |
8.00%, 11/17/2028(a) | | | 9,750,000 | | | | 7,824,375 | |
| | |
ZF North America Capital, Inc. | | | | | | | | |
6.88%, 4/14/2028(a) | | | 515,000 | | | | 499,060 | |
7.13%, 4/14/2030(a) | | | 240,000 | | | | 232,815 | |
| | | | | | | 34,508,647 | |
|
Automobiles – 1.8% | |
| | |
Aston Martin Capital Holdings Ltd. | | | | | | | | |
10.50%, 11/30/2025(a) | | | 5,000,000 | | | | 4,945,363 | |
| | |
Ford Motor Co. | | | | | | | | |
6.38%, 2/1/2029 | | | 305,000 | | | | 290,322 | |
9.63%, 4/22/2030 | | | 130,000 | | | | 144,957 | |
3.25%, 2/12/2032 | | | 2,335,000 | | | | 1,762,339 | |
6.10%, 8/19/2032 | | | 1,495,000 | | | | 1,382,799 | |
4.75%, 1/15/2043 | | | 3,101,000 | | | | 2,154,053 | |
7.40%, 11/1/2046 | | | 985,000 | | | | 924,272 | |
5.29%, 12/8/2046 | | | 2,500,000 | | | | 1,816,260 | |
| | |
Jaguar Land Rover Automotive plc | | | | | | | | |
7.75%, 10/15/2025(a) | | | 390,000 | | | | 390,262 | |
4.50%, 10/1/2027(a) | | | 2,535,000 | | | | 2,186,160 | |
5.88%, 1/15/2028(a) | | | 2,926,000 | | | | 2,633,520 | |
5.50%, 7/15/2029(a) | | | 2,307,000 | | | | 1,988,591 | |
See Accompanying Notes to the Financial Statements.
| | | | |
422 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Automobiles – (continued) | |
| | |
Mclaren Finance plc | | | | | | | | |
7.50%, 8/1/2026(a) | | $ | 1,190,000 | | | $ | 1,017,450 | |
| | |
Thor Industries, Inc. | | | | | | | | |
4.00%, 10/15/2029(a) | | | 1,050,000 | | | | 846,352 | |
| | | | | | | 22,482,700 | |
|
Banks – 0.5% | |
| | |
Intesa Sanpaolo SpA | | | | | | | | |
5.71%, 1/15/2026(a) | | | 1,200,000 | | | | 1,138,427 | |
4.20%, 6/1/2032(a)(c) | | | 590,000 | | | | 419,368 | |
4.95%, 6/1/2042(a)(c) | | | 170,000 | | | | 99,705 | |
| | |
Texas Capital Bancshares, Inc. | | | | | | | | |
4.00%, 5/6/2031(c) | | | 2,080,000 | | | | 1,716,224 | |
| | |
UniCredit SpA | | | | | | | | |
7.30%, 4/2/2034(a)(c) | | | 2,560,000 | | | | 2,375,561 | |
5.46%, 6/30/2035(a)(c) | | | 285,000 | | | | 233,806 | |
| | | | | | | 5,983,091 | |
|
Beverages – 0.0%(d) | |
| | |
Primo Water Holdings, Inc. | | | | | | | | |
4.38%, 4/30/2029(a) | | | 475,000 | | | | 400,762 | |
|
Broadline Retail – 0.9% | |
| | |
ANGI Group LLC | | | | | | | | |
3.88%, 8/15/2028(a) | | | 2,815,000 | | | | 2,111,231 | |
| | |
Go Daddy Operating Co. LLC | | | | | | | | |
3.50%, 3/1/2029(a) | | | 500,000 | | | | 419,725 | |
| | |
Kohl's Corp. | | | | | | | | |
5.55%, 7/17/2045 | | | 1,250,000 | | | | 725,000 | |
| | |
Macy's Retail Holdings LLC | | | | | | | | |
5.88%, 3/15/2030(a) | | | 100,000 | | | | 84,599 | |
6.13%, 3/15/2032(a) | | | 140,000 | | | | 115,620 | |
6.70%, 7/15/2034(a) | | | 1,000,000 | | | | 763,750 | |
4.50%, 12/15/2034 | | | 1,446,000 | | | | 968,820 | |
5.13%, 1/15/2042 | | | 1,000,000 | | | | 615,900 | |
| | |
Millennium Escrow Corp. | | | | | | | | |
6.63%, 8/1/2026(a) | | | 4,235,000 | | | | 3,143,984 | |
| | |
QVC, Inc. | | | | | | | | |
4.45%, 2/15/2025 | | | 1,875,000 | | | | 1,615,002 | |
| | | | | | | 10,563,631 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Building Products – 1.2% | |
| | |
ACProducts Holdings, Inc. | | | | | | | | |
6.38%, 5/15/2029(a) | | $ | 1,800,000 | | | $ | 1,098,000 | |
| | |
Camelot Return Merger Sub, Inc. | | | | | | | | |
8.75%, 8/1/2028(a) | | | 1,425,000 | | | | 1,330,565 | |
| | |
Cornerstone Building Brands, Inc. | | | | | | | | |
6.13%, 1/15/2029(a) | | | 635,000 | | | | 464,249 | |
| | |
CP Atlas Buyer, Inc. | | | | | | | | |
7.00%, 12/1/2028(a) | | | 1,130,000 | | | | 861,263 | |
| | |
Eco Material Technologies, Inc. | | | | | | | | |
7.88%, 1/31/2027(a) | | | 1,160,000 | | | | 1,098,501 | |
| | |
Emerald Debt Merger Sub LLC | | | | | | | | |
6.63%, 12/15/2030(a) | | | 1,870,000 | | | | 1,778,838 | |
| | |
Griffon Corp. | | | | | | | | |
5.75%, 3/1/2028 | | | 2,040,000 | | | | 1,842,257 | |
| | |
JELD-WEN, Inc. | | | | | | | | |
4.88%, 12/15/2027(a) | | | 716,000 | | | | 606,913 | |
| | |
Masonite International Corp. | | | | | | | | |
3.50%, 2/15/2030(a) | | | 135,000 | | | | 106,896 | |
| | |
MIWD Holdco II LLC | | | | | | | | |
5.50%, 2/1/2030(a) | | | 1,345,000 | | | | 1,067,594 | |
| | |
Smyrna Ready Mix Concrete LLC | | | | | | | | |
6.00%, 11/1/2028(a) | | | 1,427,000 | | | | 1,319,385 | |
| | |
Standard Industries, Inc. | | | | | | | | |
5.00%, 2/15/2027(a) | | | 1,125,000 | | | | 1,039,811 | |
4.75%, 1/15/2028(a) | | | 620,000 | | | | 554,838 | |
4.38%, 7/15/2030(a) | | | 1,340,000 | | | | 1,094,811 | |
3.38%, 1/15/2031(a) | | | 595,000 | | | | 450,246 | |
| | | | | | | 14,714,167 | |
|
Capital Markets – 0.2% | |
| | |
Brightsphere Investment Group, Inc. | | | | | | | | |
4.80%, 7/27/2026 | | | 225,000 | | | | 203,625 | |
| | |
Compass Group Diversified Holdings LLC | | | | | | | | |
5.25%, 4/15/2029(a) | | | 730,000 | | | | 623,378 | |
| | |
Jane Street Group | | | | | | | | |
4.50%, 11/15/2029(a) | | | 500,000 | | | | 426,070 | |
| | |
Nomura Holdings, Inc. | | | | | | | | |
2.65%, 1/16/2025 | | | 1,250,000 | | | | 1,193,813 | |
| | | | | | | 2,446,886 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 423 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Chemicals – 5.2% | |
| | |
Ashland, Inc. | | | | | | | | |
3.38%, 9/1/2031(a) | | $ | 2,290,000 | | | $ | 1,755,458 | |
6.88%, 5/15/2043 | | | 1,105,000 | | | | 1,037,174 | |
| | |
ASP Unifrax Holdings, Inc. | | | | | | | | |
5.25%, 9/30/2028(a) | | | 4,306,000 | | | | 2,908,474 | |
7.50%, 9/30/2029(a) | | | 2,414,000 | | | | 1,291,490 | |
| | |
Cerdia Finanz GmbH | | | | | | | | |
10.50%, 2/15/2027(a) | | | 1,015,000 | | | | 997,816 | |
| | |
Chemours Co. (The) | | | | | | | | |
5.38%, 5/15/2027 | | | 1,095,000 | | | | 989,240 | |
5.75%, 11/15/2028(a) | | | 1,540,000 | | | | 1,302,455 | |
4.63%, 11/15/2029(a) | | | 2,095,000 | | | | 1,618,133 | |
| | |
Cornerstone Chemical Co. | | | | | | | | |
10.25%, 9/1/2027(a) | | | 2,300,000 | | | | 1,948,343 | |
| | |
CVR Partners LP | | | | | | | | |
6.13%, 6/15/2028(a) | | | 2,800,000 | | | | 2,471,000 | |
| | |
Element Solutions, Inc. | | | | | | | | |
3.88%, 9/1/2028(a) | | | 605,000 | | | | 514,766 | |
| | |
FXI Holdings, Inc. | | | | | | | | |
12.25%, 11/15/2026(a) | | | 4,216,000 | | | | 3,493,255 | |
| | |
Gates Global LLC | | | | | | | | |
6.25%, 1/15/2026(a) | | | 500,000 | | | | 489,700 | |
| | |
GPD Cos., Inc. | | | | | | | | |
10.13%, 4/1/2026(a) | | | 2,700,000 | | | | 2,431,709 | |
| | |
HB Fuller Co. | | | | | | | | |
4.25%, 10/15/2028 | | | 795,000 | | | | 688,724 | |
| | |
Herens Holdco Sarl | | | | | | | | |
4.75%, 5/15/2028(a) | | | 1,910,000 | | | | 1,479,434 | |
| | |
INEOS Finance plc | | | | | | | | |
6.75%, 5/15/2028(a) | | | 2,210,000 | | | | 2,063,555 | |
| | |
INEOS Quattro Finance 2 plc | | | | | | | | |
3.38%, 1/15/2026(a) | | | 260,000 | | | | 248,300 | |
| | |
Ingevity Corp. | | | | | | | | |
3.88%, 11/1/2028(a) | | | 1,765,000 | | | | 1,432,888 | |
| | |
LSB Industries, Inc. | | | | | | | | |
6.25%, 10/15/2028(a) | | | 1,240,000 | | | | 1,100,019 | |
| | |
Minerals Technologies, Inc. | | | | | | | | |
5.00%, 7/1/2028(a) | | | 755,000 | | | | 660,081 | |
| | |
NOVA Chemicals Corp. | | | | | | | | |
5.00%, 5/1/2025(a) | | | 2,777,000 | | | | 2,622,771 | |
5.25%, 6/1/2027(a) | | | 5,665,000 | | | | 4,785,026 | |
4.25%, 5/15/2029(a) | | | 2,995,000 | | | | 2,215,059 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Chemicals – (continued) | |
| | |
Olympus Water US Holding Corp. | | | | | | | | |
7.13%, 10/1/2027(a) | | $ | 870,000 | | | $ | 801,025 | |
4.25%, 10/1/2028(a) | | | 1,550,000 | | | | 1,236,807 | |
9.75%, 11/15/2028(a) | | | 1,725,000 | | | | 1,684,809 | |
| | |
Polar US Borrower LLC | | | | | | | | |
6.75%, 5/15/2026(a) | | | 1,680,000 | | | | 739,200 | |
| | |
Rain Carbon, Inc. | | | | | | | | |
12.25%, 9/1/2029(a) | | | 2,400,000 | | | | 2,442,000 | |
| | |
SCIH Salt Holdings, Inc. | | | | | | | | |
4.88%, 5/1/2028(a) | | | 1,683,000 | | | | 1,453,064 | |
| | |
SCIL IV LLC | | | | | | | | |
5.38%, 11/1/2026(a) | | | 1,380,000 | | | | 1,224,096 | |
| | |
SK Invictus Intermediate II Sarl | | | | | | | | |
5.00%, 10/30/2029(a) | | | 3,587,000 | | | | 2,708,483 | |
| | |
TPC Group, Inc. | | | | | | | | |
13.00%, 12/16/2027(a) | | | 2,000,000 | | | | 1,995,760 | |
| | |
Tronox, Inc. | | | | | | | | |
4.63%, 3/15/2029(a) | | | 5,850,000 | | | | 4,608,236 | |
| | |
Vibrantz Technologies, Inc. | | | | | | | | |
9.00%, 2/15/2030(a) | | | 1,665,000 | | | | 1,325,163 | |
| | |
WR Grace Holdings LLC | | | | | | | | |
5.63%, 8/15/2029(a) | | | 3,195,000 | | | | 2,476,125 | |
| | | | | | | 63,239,638 | |
|
Commercial Services & Supplies – 4.1% | |
| | |
ADT Security Corp. (The) | | | | | | | | |
4.13%, 8/1/2029(a) | | | 755,000 | | | | 647,526 | |
4.88%, 7/15/2032(a) | | | 331,000 | | | | 276,885 | |
| | |
Allied Universal Holdco LLC | | | | | | | | |
6.63%, 7/15/2026(a) | | | 2,915,000 | | | | 2,729,897 | |
9.75%, 7/15/2027(a) | | | 3,075,000 | | | | 2,671,025 | |
4.63%, 6/1/2028(a) | | | 4,145,000 | | | | 3,384,767 | |
6.00%, 6/1/2029(a) | | | 1,800,000 | | | | 1,300,500 | |
| | |
Aptim Corp. | | | | | | | | |
7.75%, 6/15/2025(a) | | | 500,000 | | | | 456,410 | |
| | |
APX Group, Inc. | | | | | | | | |
6.75%, 2/15/2027(a) | | | 1,000,000 | | | | 965,410 | |
5.75%, 7/15/2029(a) | | | 4,365,000 | | | | 3,628,903 | |
| | |
Cimpress plc | | | | | | | | |
7.00%, 6/15/2026 | | | 1,330,000 | | | | 1,230,809 | |
| | |
CoreCivic, Inc. | | | | | | | | |
4.75%, 10/15/2027 | | | 490,000 | | | | 425,687 | |
See Accompanying Notes to the Financial Statements.
| | | | |
424 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Commercial Services & Supplies – (continued) | |
| | |
Covanta Holding Corp. | | | | | | | | |
4.88%, 12/1/2029(a) | | $ | 720,000 | | | $ | 561,600 | |
5.00%, 9/1/2030 | | | 460,000 | | | | 355,815 | |
| | |
Deluxe Corp. | | | | | | | | |
8.00%, 6/1/2029(a) | | | 2,825,000 | | | | 2,235,281 | |
| | |
Garda World Security Corp. | | | | | | | | |
4.63%, 2/15/2027(a) | | | 910,000 | | | | 811,625 | |
9.50%, 11/1/2027(a) | | | 1,120,000 | | | | 1,017,741 | |
7.75%, 2/15/2028(a) | | | 460,000 | | | | 442,373 | |
| | |
GFL Environmental, Inc. | | | | | | | | |
4.00%, 8/1/2028(a) | | | 1,370,000 | | | | 1,179,007 | |
4.75%, 6/15/2029(a) | | | 325,000 | | | | 284,506 | |
4.38%, 8/15/2029(a) | | | 50,000 | | | | 42,640 | |
| | |
Interface, Inc. | | | | | | | | |
5.50%, 12/1/2028(a) | | | 1,405,000 | | | | 1,181,198 | |
| | |
Neptune Bidco US, Inc. | | | | | | | | |
9.29%, 4/15/2029(a) | | | 13,535,000 | | | | 11,945,296 | |
| | |
Pitney Bowes, Inc. | | | | | | | | |
6.88%, 3/15/2027(a) | | | 1,925,000 | | | | 1,593,457 | |
| | |
Prime Security Services Borrower LLC | | | | | | | | |
5.75%, 4/15/2026(a) | | | 2,745,000 | | | | 2,662,946 | |
3.38%, 8/31/2027(a) | | | 2,060,000 | | | | 1,811,175 | |
6.25%, 1/15/2028(a) | | | 4,340,000 | | | | 4,024,494 | |
| | |
Stericycle, Inc. | | | | | | | | |
3.88%, 1/15/2029(a) | | | 185,000 | | | | 157,186 | |
| | |
WASH Multifamily Acquisition, Inc. | | | | | | | | |
5.75%, 4/15/2026(a) | | | 1,415,000 | | | | 1,308,875 | |
| | |
West Technology Group LLC | | | | | | | | |
8.50%, 4/10/2027(a) | | | 750,000 | | | | 645,000 | |
| | |
Williams Scotsman, Inc. | | | | | | | | |
4.63%, 8/15/2028(a) | | | 100,000 | | | | 88,837 | |
| | | | | | | 50,066,871 | |
|
Communications Equipment – 0.1% | |
| | |
CommScope Technologies LLC | | | | | | | | |
6.00%, 6/15/2025(a) | | | 170,000 | | | | 102,000 | |
| | |
CommScope, Inc. | | | | | | | | |
6.00%, 3/1/2026(a) | | | 380,000 | | | | 319,192 | |
8.25%, 3/1/2027(a) | | | 850,000 | | | | 352,750 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Communications Equipment – (continued) | |
| | |
Viavi Solutions, Inc. | | | | | | | | |
3.75%, 10/1/2029(a) | | $ | 75,000 | | | $ | 58,379 | |
| | | | | | | 832,321 | |
|
Construction & Engineering – 1.0% | |
| | |
AECOM | | | | | | | | |
5.13%, 3/15/2027 | | | 1,940,000 | | | | 1,831,556 | |
| | |
Arcosa, Inc. | | | | | | | | |
4.38%, 4/15/2029(a) | | | 710,000 | | | | 619,475 | |
| | |
Artera Services LLC | | | | | | | | |
9.03%, 12/4/2025(a) | | | 2,944,000 | | | | 2,649,600 | |
| | |
Brand Industrial Services, Inc. | | | | | | | | |
10.38%, 8/1/2030(a) | | | 980,000 | | | | 972,650 | |
| | |
Brundage-Bone Concrete Pumping Holdings, Inc. | | | | | | | | |
6.00%, 2/1/2026(a) | | | 1,995,000 | | | | 1,886,392 | |
| | |
Global Infrastructure Solutions, Inc. | | | | | | | | |
5.63%, 6/1/2029(a) | | | 1,053,000 | | | | 842,400 | |
7.50%, 4/15/2032(a) | | | 1,741,000 | | | | 1,423,868 | |
| | |
HTA Group Ltd. | | | | | | | | |
7.00%, 12/18/2025(a) | | | 715,000 | | | | 690,504 | |
| | |
Railworks Holdings LP | | | | | | | | |
8.25%, 11/15/2028(a) | | | 525,000 | | | | 499,291 | |
| | |
VM Consolidated, Inc. | | | | | | | | |
5.50%, 4/15/2029(a) | | | 794,000 | | | | 703,143 | |
| | |
Weekley Homes LLC | | | | | | | | |
4.88%, 9/15/2028(a) | | | 570,000 | | | | 489,487 | |
| | | | | | | 12,608,366 | |
|
Construction Materials – 0.0%(d) | |
| | |
Knife River Corp. | | | | | | | | |
7.75%, 5/1/2031(a) | | | 120,000 | | | | 119,553 | |
|
Consumer Finance – 2.4% | |
| | |
Cobra Acquisition Co. LLC | | | | | | | | |
6.38%, 11/1/2029(a) | | | 880,000 | | | | 627,000 | |
| | |
Credit Acceptance Corp. | | | | | | | | |
6.63%, 3/15/2026 | | | 865,000 | | | | 821,319 | |
| | |
Enova International, Inc. | | | | | | | | |
8.50%, 9/15/2025(a) | | | 170,000 | | | | 159,909 | |
| | |
FirstCash, Inc. | | | | | | | | |
4.63%, 9/1/2028(a) | | | 230,000 | | | | 201,734 | |
5.63%, 1/1/2030(a) | | | 2,690,000 | | | | 2,394,569 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 425 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Consumer Finance – (continued) | |
| | |
Ford Holdings LLC | | | | | | | | |
9.30%, 3/1/2030 | | $ | 640,000 | | | $ | 685,747 | |
| | |
Ford Motor Credit Co. LLC | | | | | | | | |
4.06%, 11/1/2024 | | | 500,000 | | | | 486,750 | |
4.69%, 6/9/2025 | | | 1,000,000 | | | | 965,976 | |
5.13%, 6/16/2025 | | | 500,000 | | | | 486,507 | |
4.13%, 8/4/2025 | | | 250,000 | | | | 238,284 | |
3.38%, 11/13/2025 | | | 660,000 | | | | 615,914 | |
6.95%, 3/6/2026 | | | 2,470,000 | | | | 2,474,264 | |
4.54%, 8/1/2026 | | | 710,000 | | | | 667,742 | |
2.70%, 8/10/2026 | | | 3,235,000 | | | | 2,899,646 | |
4.27%, 1/9/2027 | | | 1,035,000 | | | | 957,596 | |
4.95%, 5/28/2027 | | | 1,705,000 | | | | 1,599,284 | |
4.13%, 8/17/2027 | | | 1,285,000 | | | | 1,166,662 | |
3.82%, 11/2/2027 | | | 740,000 | | | | 659,713 | |
7.35%, 11/4/2027 | | | 1,640,000 | | | | 1,659,964 | |
2.90%, 2/16/2028 | | | 935,000 | | | | 795,371 | |
6.80%, 5/12/2028 | | | 465,000 | | | | 463,671 | |
5.11%, 5/3/2029 | | | 1,537,000 | | | | 1,398,911 | |
7.35%, 3/6/2030 | | | 1,370,000 | | | | 1,375,852 | |
4.00%, 11/13/2030 | | | 195,000 | | | | 160,619 | |
| | |
goeasy Ltd. | | | | | | | | |
4.38%, 5/1/2026(a) | | | 525,000 | | | | 474,337 | |
| | |
LFS Topco LLC | | | | | | | | |
5.88%, 10/15/2026(a) | | | 900,000 | | | | 758,873 | |
| | |
Macquarie Airfinance Holdings Ltd. | | | | | | | | |
8.38%, 5/1/2028(a) | | | 905,000 | | | | 902,059 | |
| | |
OneMain Finance Corp. | | | | | | | | |
7.13%, 3/15/2026 | | | 330,000 | | | | 320,495 | |
3.88%, 9/15/2028 | | | 300,000 | | | | 237,195 | |
| | |
PRA Group, Inc. | | | | | | | | |
7.38%, 9/1/2025(a) | | | 115,000 | | | | 107,525 | |
| | |
SLM Corp. | | | | | | | | |
3.13%, 11/2/2026 | | | 200,000 | | | | 173,868 | |
| | |
Synchrony Financial | | | | | | | | |
7.25%, 2/2/2033 | | | 700,000 | | | | 593,607 | |
| | |
World Acceptance Corp. | | | | | | | | |
7.00%, 11/1/2026(a) | | | 1,680,000 | | | | 1,360,800 | |
| | | | | | | 28,891,763 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Consumer Staples Distribution & Retail – 1.0% | |
| | |
Albertsons Cos., Inc. | | | | | | | | |
3.25%, 3/15/2026(a) | | $ | 500,000 | | | $ | 461,845 | |
4.63%, 1/15/2027(a) | | | 1,200,000 | | | | 1,124,654 | |
5.88%, 2/15/2028(a) | | | 500,000 | | | | 478,949 | |
6.50%, 2/15/2028(a) | | | 500,000 | | | | 490,896 | |
3.50%, 3/15/2029(a) | | | 1,000,000 | | | | 852,601 | |
4.88%, 2/15/2030(a) | | | 1,000,000 | | | | 892,816 | |
| | |
C&S Group Enterprises LLC | | | | | | | | |
5.00%, 12/15/2028(a) | | | 800,000 | | | | 619,000 | |
| | |
Ingles Markets, Inc. | | | | | | | | |
4.00%, 6/15/2031(a) | | | 1,875,000 | | | | 1,490,625 | |
| | |
Performance Food Group, Inc. | | | | | | | | |
5.50%, 10/15/2027(a) | | | 890,000 | | | | 832,216 | |
4.25%, 8/1/2029(a) | | | 5,290,000 | | | | 4,463,572 | |
| | |
US Foods, Inc. | | | | | | | | |
4.75%, 2/15/2029(a) | | | 660,000 | | | | 582,224 | |
4.63%, 6/1/2030(a) | | | 140,000 | | | | 119,547 | |
| | | | | | | 12,408,945 | |
|
Containers & Packaging – 1.8% | |
| | |
Ardagh Metal Packaging Finance USA LLC | | | | | | | | |
6.00%, 6/15/2027(a) | | | 500,000 | | | | 472,509 | |
3.25%, 9/1/2028(a) | | | 220,000 | | | | 179,173 | |
4.00%, 9/1/2029(a) | | | 815,000 | | | | 611,307 | |
| | |
Cascades, Inc. | | | | | | | | |
5.13%, 1/15/2026(a) | | | 190,000 | | | | 180,334 | |
| | |
Clydesdale Acquisition Holdings, Inc. | | | | | | | | |
6.63%, 4/15/2029(a) | | | 1,450,000 | | | | 1,317,176 | |
8.75%, 4/15/2030(a) | | | 5,659,000 | | | | 4,510,674 | |
| | |
Graham Packaging Co., Inc. | | | | | | | | |
7.13%, 8/15/2028(a) | | | 2,500,000 | | | | 1,915,337 | |
| | |
Intelligent Packaging Ltd. Finco, Inc. | | | | | | | | |
6.00%, 9/15/2028(a) | | | 2,055,000 | | | | 1,684,155 | |
| | |
Iris Holding, Inc. | | | | | | | | |
10.00%, 12/15/2028(a) | | | 1,300,000 | | | | 943,429 | |
| | |
LABL, Inc. | | | | | | | | |
10.50%, 7/15/2027(a) | | | 1,555,000 | | | | 1,346,158 | |
| | |
Mauser Packaging Solutions Holding Co. | | | | | | | | |
7.88%, 8/15/2026(a) | | | 4,220,000 | | | | 3,952,532 | |
9.25%, 4/15/2027(a) | | | 2,872,000 | | | | 2,391,828 | |
See Accompanying Notes to the Financial Statements.
| | | | |
426 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Containers & Packaging – (continued) | |
| | |
Pactiv LLC | | | | | | | | |
7.95%, 12/15/2025 | | $ | 195,000 | | | $ | 192,322 | |
| | |
Sealed Air Corp. | | | | | | | | |
6.88%, 7/15/2033(a) | | | 150,000 | | | | 140,625 | |
| | |
Trivium Packaging Finance BV | | | | | | | | |
5.50%, 8/15/2026(a)(e) | | | 750,000 | | | | 679,863 | |
8.50%, 8/15/2027(a)(e) | | | 1,510,000 | | | | 1,259,962 | |
| | | | | | | 21,777,384 | |
|
Distributors – 0.4% | |
| | |
American Builders & Contractors Supply Co., Inc. | | | | | | | | |
4.00%, 1/15/2028(a) | | | 400,000 | | | | 359,063 | |
| | |
Resideo Funding, Inc. | | | | | | | | |
4.00%, 9/1/2029(a) | | | 750,000 | | | | 601,875 | |
| | |
Windsor Holdings III LLC | | | | | | | | |
8.50%, 6/15/2030(a) | | | 4,000,000 | | | | 3,893,866 | |
| | | | | | | 4,854,804 | |
|
Diversified Consumer Services – 0.9% | |
| | |
Adtalem Global Education, Inc. | | | | | | | | |
5.50%, 3/1/2028(a) | | | 805,000 | | | | 733,033 | |
| | |
Grand Canyon University | | | | | | | | |
4.13%, 10/1/2024 | | | 1,212,000 | | | | 1,152,854 | |
4.38%, 10/1/2026 | | | 500,000 | | | | 478,750 | |
5.13%, 10/1/2028 | | | 2,220,000 | | | | 1,964,256 | |
| | |
Signal Parent, Inc. | | | | | | | | |
6.13%, 4/1/2029(a) | | | 1,735,000 | | | | 988,950 | |
| | |
Sotheby's | | | | | | | | |
7.38%, 10/15/2027(a) | | | 4,000,000 | | | | 3,572,341 | |
| | |
StoneMor, Inc. | | | | | | | | |
8.50%, 5/15/2029(a) | | | 1,910,000 | | | | 1,525,613 | |
| | | | | | | 10,415,797 | |
|
Diversified REITs – 1.1% | |
| | |
Global Net Lease, Inc. | | | | | | | | |
REIT, 3.75%, 12/15/2027(a) | | | 2,810,000 | | | | 2,127,433 | |
| | |
Iron Mountain Information Management Services, Inc. | | | | | | | | |
REIT, 5.00%, 7/15/2032(a) | | | 350,000 | | | | 286,390 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified REITs – (continued) | |
| | |
Necessity Retail REIT, Inc. (The) | | | | | | | | |
REIT, 4.50%, 9/30/2028(a) | | $ | 2,620,000 | | | $ | 1,961,725 | |
| | |
Uniti Group LP | | | | | | | | |
REIT, 10.50%, 2/15/2028(a) | | | 5,155,000 | | | | 4,964,028 | |
REIT, 6.50%, 2/15/2029(a) | | | 5,750,000 | | | | 3,734,094 | |
| | | | | | | 13,073,670 | |
|
Diversified Telecommunication Services – 5.5% | |
| | |
Altice France Holding SA | | | | | | | | |
10.50%, 5/15/2027(a) | | | 8,280,000 | | | | 4,505,151 | |
6.00%, 2/15/2028(a) | | | 5,928,000 | | | | 2,599,758 | |
| | |
Altice France SA | | | | | | | | |
8.13%, 2/1/2027(a) | | | 3,585,000 | | | | 3,022,030 | |
5.50%, 1/15/2028(a) | | | 3,050,000 | | | | 2,266,233 | |
5.13%, 1/15/2029(a) | | | 935,000 | | | | 645,294 | |
5.13%, 7/15/2029(a) | | | 5,185,000 | | | | 3,549,969 | |
5.50%, 10/15/2029(a) | | | 4,000,000 | | | | 2,751,603 | |
| | |
CCO Holdings LLC | | | | | | | | |
5.13%, 5/1/2027(a) | | | 2,201,000 | | | | 2,026,453 | |
5.00%, 2/1/2028(a) | | | 1,210,000 | | | | 1,086,504 | |
5.38%, 6/1/2029(a) | | | 180,000 | | | | 157,550 | |
6.38%, 9/1/2029(a) | | | 515,000 | | | | 471,327 | |
4.75%, 3/1/2030(a) | | | 1,905,000 | | | | 1,571,478 | |
4.50%, 8/15/2030(a) | | | 1,385,000 | | | | 1,110,542 | |
4.25%, 2/1/2031(a) | | | 1,570,000 | | | | 1,221,771 | |
4.75%, 2/1/2032(a) | | | 680,000 | | | | 530,781 | |
4.50%, 5/1/2032 | | | 1,587,000 | | | | 1,214,843 | |
4.50%, 6/1/2033(a) | | | 1,760,000 | | | | 1,312,899 | |
4.25%, 1/15/2034(a) | | | 1,750,000 | | | | 1,264,030 | |
| | |
Embarq Corp. | | | | | | | | |
8.00%, 6/1/2036 | | | 2,600,000 | | | | 1,417,000 | |
| | |
Frontier California, Inc. | | | | | | | | |
Series F, 6.75%, 5/15/2027 | | | 215,000 | | | | 197,262 | |
| | |
Frontier Communications Holdings LLC | | | | | | | | |
6.75%, 5/1/2029(a) | | | 700,000 | | | | 553,912 | |
8.75%, 5/15/2030(a) | | | 80,000 | | | | 76,220 | |
| | |
Iliad Holding SASU | | | | | | | | |
7.00%, 10/15/2028(a) | | | 1,325,000 | | | | 1,199,062 | |
| | |
Intelsat Jackson Holdings SA | | | | | | | | |
6.50%, 3/15/2030(a) | | | 3,075,000 | | | | 2,699,945 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 427 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Diversified Telecommunication Services – (continued) | |
| | |
Level 3 Financing, Inc. | | | | | | | | |
4.63%, 9/15/2027(a) | | $ | 2,035,000 | | | $ | 1,353,275 | |
4.25%, 7/1/2028(a) | | | 6,470,000 | | | | 3,658,610 | |
3.63%, 1/15/2029(a) | | | 4,600,000 | | | | 2,349,197 | |
3.75%, 7/15/2029(a) | | | 500,000 | | | | 254,208 | |
| | |
Lumen Technologies, Inc. | | | | | | | | |
5.63%, 4/1/2025 | | | 740,000 | | | | 583,962 | |
5.13%, 12/15/2026(a) | | | 1,810,000 | | | | 888,899 | |
4.00%, 2/15/2027(a) | | | 4,110,000 | | | | 2,774,250 | |
| | |
Telesat Canada | | | | | | | | |
5.63%, 12/6/2026(a) | | | 1,585,000 | | | | 1,011,690 | |
4.88%, 6/1/2027(a) | | | 1,110,000 | | | | 657,675 | |
| | |
Virgin Media Finance plc | | | | | | | | |
5.00%, 7/15/2030(a) | | | 4,735,000 | | | | 3,722,579 | |
| | |
Virgin Media Secured Finance plc | | | | | | | | |
4.50%, 8/15/2030(a) | | | 805,000 | | | | 663,771 | |
| | |
Windstream Escrow LLC | | | | | | | | |
7.75%, 8/15/2028(a) | | | 7,481,000 | | | | 5,932,334 | |
| | |
Zayo Group Holdings, Inc. | | | | | | | | |
4.00%, 3/1/2027(a) | | | 4,680,000 | | | | 3,522,368 | |
6.13%, 3/1/2028(a) | | | 3,230,000 | | | | 2,139,708 | |
| | | | | | | 66,964,143 | |
|
Electric Utilities – 1.5% | |
| | |
Edison International | | | | | | | | |
8.13%, 6/15/2053(c) | | | 1,165,000 | | | | 1,123,347 | |
| | |
Emera, Inc. | | | | | | | | |
Series 16-A, 6.75%, 6/15/2076(c) | | | 6,450,000 | | | | 6,065,819 | |
| | |
Leeward Renewable Energy Operations LLC | | | | | | | | |
4.25%, 7/1/2029(a) | | | 195,000 | | | | 159,251 | |
| | |
NextEra Energy Operating Partners LP | | | | | | | | |
3.88%, 10/15/2026(a) | | | 2,510,000 | | | | 2,282,140 | |
4.50%, 9/15/2027(a) | | | 2,720,000 | | | | 2,435,474 | |
| | |
NRG Energy, Inc. | | | | | | | | |
3.38%, 2/15/2029(a) | | | 129,000 | | | | 104,993 | |
5.25%, 6/15/2029(a) | | | 1,380,000 | | | | 1,217,519 | |
3.63%, 2/15/2031(a) | | | 935,000 | | | | 705,585 | |
3.88%, 2/15/2032(a) | | | 1,000,000 | | | | 743,165 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Electric Utilities – (continued) | |
| | |
Pattern Energy Operations LP | | | | | | | | |
4.50%, 8/15/2028(a) | | $ | 500,000 | | | $ | 435,839 | |
| | |
PG&E Corp. | | | | | | | | |
5.00%, 7/1/2028 | | | 1,000,000 | | | | 905,945 | |
5.25%, 7/1/2030 | | | 925,000 | | | | 810,209 | |
| | |
Vistra Operations Co. LLC | | | | | | | | |
5.63%, 2/15/2027(a) | | | 1,810,000 | | | | 1,703,234 | |
| | | | | | | 18,692,520 | |
|
Electronic Equipment, Instruments & Components – 0.1% | |
| | |
Crane NXT Co. | | | | | | | | |
4.20%, 3/15/2048 | | | 920,000 | | | | 556,960 | |
| | |
Likewize Corp. | | | | | | | | |
9.75%, 10/15/2025(a) | | | 1,096,000 | | | | 1,088,589 | |
| | | | | | | 1,645,549 | |
|
Energy Equipment & Services – 2.4% | |
| | |
Archrock Partners LP | | | | | | | | |
6.88%, 4/1/2027(a) | | | 810,000 | | | | 778,699 | |
6.25%, 4/1/2028(a) | | | 1,655,000 | | | | 1,537,081 | |
| | |
CGG SA | | | | | | | | |
8.75%, 4/1/2027(a) | | | 2,780,000 | | | | 2,453,656 | |
| | |
Nabors Industries Ltd. | | | | | | | | |
7.25%, 1/15/2026(a) | | | 215,000 | | | | 201,986 | |
| | |
Nine Energy Service, Inc. | | | | | | | | |
13.00%, 2/1/2028 | | | 1,000,000 | | | | 885,000 | |
| | |
Noble Finance II LLC | | | | | | | | |
8.00%, 4/15/2030(a) | | | 3,160,000 | | | | 3,158,069 | |
| | |
Oceaneering International, Inc. | | | | | | | | |
6.00%, 2/1/2028 | | | 430,000 | | | | 394,525 | |
| | |
Precision Drilling Corp. | | | | | | | | |
6.88%, 1/15/2029(a) | | | 900,000 | | | | 833,313 | |
| | |
Seadrill Finance Ltd. | | | | | | | | |
8.38%, 8/1/2030(a) | | | 3,000,000 | | | | 3,000,960 | |
| | |
USA Compression Partners LP | | | | | | | | |
6.88%, 4/1/2026 | | | 3,780,000 | | | | 3,670,773 | |
6.88%, 9/1/2027 | | | 3,813,000 | | | | 3,653,264 | |
| | |
Valaris Ltd. | | | | | | | | |
8.38%, 4/30/2030(a) | | | 5,885,000 | | | | 5,774,656 | |
| | |
Weatherford International Ltd. | | | | | | | | |
8.63%, 4/30/2030(a) | | | 3,265,000 | | | | 3,299,214 | |
| | | | | | | 29,641,196 | |
See Accompanying Notes to the Financial Statements.
| | | | |
428 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Entertainment – 0.4% | |
| | |
Allen Media LLC | | | | | | | | |
10.50%, 2/15/2028(a) | | $ | 2,145,000 | | | $ | 1,117,127 | |
| | |
Cinemark USA, Inc. | | | | | | | | |
5.88%, 3/15/2026(a) | | | 725,000 | | | | 688,408 | |
5.25%, 7/15/2028(a) | | | 1,740,000 | | | | 1,502,799 | |
| | |
Live Nation Entertainment, Inc. | | | | | | | | |
4.75%, 10/15/2027(a) | | | 1,825,000 | | | | 1,667,703 | |
| | | | | | | 4,976,037 | |
|
Financial Services – 2.2% | |
| | |
Freedom Mortgage Corp. | | | | | | | | |
7.63%, 5/1/2026(a) | | | 250,000 | | | | 230,072 | |
6.63%, 1/15/2027(a) | | | 2,750,000 | | | | 2,380,100 | |
12.00%, 10/1/2028(a) | | | 500,000 | | | | 501,599 | |
12.25%, 10/1/2030(a) | | | 500,000 | | | | 500,164 | |
| | |
GTCR W-2 Merger Sub LLC | | | | | | | | |
7.50%, 1/15/2031(a) | | | 1,000,000 | | | | 987,350 | |
| | |
Jefferies Finance LLC | | | | | | | | |
5.00%, 8/15/2028(a) | | | 3,650,000 | | | | 2,913,014 | |
| | |
Jefferson Capital Holdings LLC | | | | | | | | |
6.00%, 8/15/2026(a) | | | 1,581,000 | | | | 1,380,643 | |
| | |
MGIC Investment Corp. | | | | | | | | |
5.25%, 8/15/2028 | | | 1,355,000 | | | | 1,245,483 | |
| | |
Midcap Financial Issuer Trust | | | | | | | | |
6.50%, 5/1/2028(a) | | | 5,420,000 | | | | 4,592,960 | |
5.63%, 1/15/2030(a) | | | 2,030,000 | | | | 1,562,026 | |
| | |
Mobius Merger Sub, Inc. | | | | | | | | |
9.00%, 6/1/2030(a) | | | 250,000 | | | | 224,084 | |
| | |
Nationstar Mortgage Holdings, Inc. | | | | | | | | |
5.00%, 2/1/2026(a) | | | 730,000 | | | | 678,533 | |
6.00%, 1/15/2027(a) | | | 1,200,000 | | | | 1,115,424 | |
5.50%, 8/15/2028(a) | | | 1,901,000 | | | | 1,679,914 | |
5.13%, 12/15/2030(a) | | | 275,000 | | | | 222,526 | |
5.75%, 11/15/2031(a) | | | 220,000 | | | | 183,227 | |
| | |
NMI Holdings, Inc. | | | | | | | | |
7.38%, 6/1/2025(a) | | | 335,000 | | | | 335,347 | |
| | |
Oxford Finance LLC | | | | | | | | |
6.38%, 2/1/2027(a) | | | 585,000 | | | | 533,081 | |
| | |
PennyMac Financial Services, Inc. | | | | | | | | |
4.25%, 2/15/2029(a) | | | 75,000 | | | | 61,263 | |
5.75%, 9/15/2031(a) | | | 5,000 | | | | 4,077 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Financial Services – (continued) | |
| | |
PHH Mortgage Corp. | | | | | | | | |
7.88%, 3/15/2026(a) | | $ | 1,915,000 | | | $ | 1,651,687 | |
| | |
Rocket Mortgage LLC | | | | | | | | |
2.88%, 10/15/2026(a) | | | 800,000 | | | | 696,456 | |
3.63%, 3/1/2029(a) | | | 694,000 | | | | 564,009 | |
| | |
United Wholesale Mortgage LLC | | | | | | | | |
5.50%, 11/15/2025(a) | | | 445,000 | | | | 422,965 | |
5.75%, 6/15/2027(a) | | | 815,000 | | | | 741,593 | |
5.50%, 4/15/2029(a) | | | 1,390,000 | | | | 1,164,125 | |
| | | | | | | 26,571,722 | |
|
Food Products – 1.1% | |
| | |
B&G Foods, Inc. | | | | | | | | |
5.25%, 9/15/2027 | | | 1,100,000 | | | | 905,311 | |
| | |
Lamb Weston Holdings, Inc. | | | | | | | | |
4.88%, 5/15/2028(a) | | | 250,000 | | | | 230,846 | |
4.13%, 1/31/2030(a) | | | 4,900,000 | | | | 4,156,781 | |
4.38%, 1/31/2032(a) | | | 3,803,000 | | | | 3,146,479 | |
| | |
Post Holdings, Inc. | | | | | | | | |
5.63%, 1/15/2028(a) | | | 1,680,000 | | | | 1,561,342 | |
5.50%, 12/15/2029(a) | | | 1,000,000 | | | | 891,814 | |
4.63%, 4/15/2030(a) | | | 1,379,000 | | | | 1,154,759 | |
4.50%, 9/15/2031(a) | | | 1,040,000 | | | | 841,500 | |
| | |
Sigma Holdco BV | | | | | | | | |
7.88%, 5/15/2026(a) | | | 515,000 | | | | 430,916 | |
| | |
Simmons Foods, Inc. | | | | | | | | |
4.63%, 3/1/2029(a) | | | 625,000 | | | | 507,700 | |
| | |
TreeHouse Foods, Inc. | | | | | | | | |
4.00%, 9/1/2028 | | | 50,000 | | | | 40,675 | |
| | | | | | | 13,868,123 | |
|
Gas Utilities – 0.9% | |
| | |
AmeriGas Partners LP | | | | | | | | |
5.50%, 5/20/2025 | | | 1,365,000 | | | | 1,308,376 | |
5.88%, 8/20/2026 | | | 1,405,000 | | | | 1,317,117 | |
5.75%, 5/20/2027 | | | 500,000 | | | | 459,518 | |
9.38%, 6/1/2028(a) | | | 2,500,000 | | | | 2,470,616 | |
| | |
Ferrellgas LP | | | | | | | | |
5.38%, 4/1/2026(a) | | | 1,445,000 | | | | 1,352,492 | |
| | |
Suburban Propane Partners LP | | | | | | | | |
5.88%, 3/1/2027 | | | 585,000 | | | | 554,287 | |
5.00%, 6/1/2031(a) | | | 3,420,000 | | | | 2,832,799 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 429 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Gas Utilities – (continued) | |
| | |
Superior Plus LP | | | | | | | | |
4.50%, 3/15/2029(a) | | $ | 500,000 | | | $ | 426,465 | |
| | | | | | | 10,721,670 | |
|
Ground Transportation – 1.5% | |
| | |
Albion Financing 1 Sarl | | | | | | | | |
6.13%, 10/15/2026(a) | | | 2,370,000 | | | | 2,192,250 | |
| | |
Albion Financing 2 Sarl | | | | | | | | |
8.75%, 4/15/2027(a) | | | 2,785,000 | | | | 2,544,069 | |
| | |
Carriage Purchaser, Inc. | | | | | | | | |
7.88%, 10/15/2029(a) | | | 905,000 | | | | 665,785 | |
| | |
EquipmentShare.com, Inc. | | | | | | | | |
9.00%, 5/15/2028(a) | | | 5,430,000 | | | | 5,104,200 | |
| | |
First Student Bidco, Inc. | | | | | | | | |
4.00%, 7/31/2029(a) | | | 505,000 | | | | 406,525 | |
| | |
Hertz Corp. (The) | | | | | | | | |
4.63%, 12/1/2026(a) | | | 615,000 | | | | 515,139 | |
5.00%, 12/1/2029(a) | | | 5,060,000 | | | | 3,632,595 | |
| | |
NESCO Holdings II, Inc. | | | | | | | | |
5.50%, 4/15/2029(a) | | | 1,800,000 | | | | 1,543,500 | |
| | |
PECF USS Intermediate Holding III Corp. | | | | | | | | |
8.00%, 11/15/2029(a) | | | 3,115,000 | | | | 1,477,694 | |
| | |
Uber Technologies, Inc. | | | | | | | | |
4.50%, 8/15/2029(a) | | | 250,000 | | | | 220,484 | |
| | | | | | | 18,302,241 | |
|
Health Care Equipment & Supplies – 0.4% | |
| | |
Avantor Funding, Inc. | | | | | | | | |
4.63%, 7/15/2028(a) | | | 300,000 | | | | 267,033 | |
| | |
Embecta Corp. | | | | | | | | |
5.00%, 2/15/2030(a) | | | 190,000 | | | | 150,873 | |
| | |
Garden Spinco Corp. | | | | | | | | |
8.63%, 7/20/2030(a) | | | 180,000 | | | | 185,719 | |
| | |
Hologic, Inc. | | | | | | | | |
4.63%, 2/1/2028(a) | | | 800,000 | | | | 727,521 | |
3.25%, 2/15/2029(a) | | | 500,000 | | | | 419,760 | |
| | |
Medline Borrower LP | | | | | | | | |
5.25%, 10/1/2029(a) | | | 2,315,000 | | | | 1,970,578 | |
| | |
Teleflex, Inc. | | | | | | | | |
4.63%, 11/15/2027 | | | 1,050,000 | | | | 960,750 | |
4.25%, 6/1/2028(a) | | | 500,000 | | | | 441,251 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Varex Imaging Corp. | | | | | | | | |
7.88%, 10/15/2027(a) | | $ | 9,000 | | | $ | 8,821 | |
| | | | | | | 5,132,306 | |
|
Health Care Providers & Services – 3.0% | |
| | |
180 Medical, Inc. | | | | | | | | |
3.88%, 10/15/2029(a) | | | 200,000 | | | | 166,155 | |
| | |
Acadia Healthcare Co., Inc. | | | | | | | | |
5.50%, 7/1/2028(a) | | | 1,130,000 | | | | 1,043,207 | |
5.00%, 4/15/2029(a) | | | 150,000 | | | | 133,742 | |
| | |
AdaptHealth LLC | | | | | | | | |
6.13%, 8/1/2028(a) | | | 815,000 | | | | 669,143 | |
| | |
AHP Health Partners, Inc. | | | | | | | | |
5.75%, 7/15/2029(a) | | | 1,547,000 | | | | 1,268,540 | |
| | |
Community Health Systems, Inc. | | | | | | | | |
8.00%, 3/15/2026(a) | | | 1,050,000 | | | | 959,758 | |
| | |
DaVita, Inc. | | | | | | | | |
4.63%, 6/1/2030(a) | | | 1,223,000 | | | | 958,478 | |
| | |
Encompass Health Corp. | | | | | | | | |
4.75%, 2/1/2030 | | | 485,000 | | | | 419,124 | |
4.63%, 4/1/2031 | | | 250,000 | | | | 208,109 | |
| | |
Global Medical Response, Inc. | | | | | | | | |
6.50%, 10/1/2025(a) | | | 3,180,000 | | | | 2,019,300 | |
| | |
HealthEquity, Inc. | | | | | | | | |
4.50%, 10/1/2029(a) | | | 320,000 | | | | 274,112 | |
| | |
Heartland Dental LLC | | | | | | | | |
8.50%, 5/1/2026(a) | | | 600,000 | | | | 546,107 | |
10.50%, 4/30/2028(a) | | | 1,225,000 | | | | 1,177,384 | |
| | |
Kedrion SpA | | | | | | | | |
6.50%, 9/1/2029(a) | | | 515,000 | | | | 428,738 | |
| | |
Legacy LifePoint Health LLC | | | | | | | | |
4.38%, 2/15/2027(a) | | | 1,745,000 | | | | 1,442,958 | |
| | |
LifePoint Health, Inc. | | | | | | | | |
5.38%, 1/15/2029(a) | | | 1,595,000 | | | | 966,328 | |
9.88%, 8/15/2030(a) | | | 2,830,000 | | | | 2,557,613 | |
| | |
Molina Healthcare, Inc. | | | | | | | | |
4.38%, 6/15/2028(a) | | | 1,505,000 | | | | 1,339,475 | |
3.88%, 11/15/2030(a) | | | 3,400,000 | | | | 2,773,107 | |
3.88%, 5/15/2032(a) | | | 3,900,000 | | | | 3,064,462 | |
| | |
Option Care Health, Inc. | | | | | | | | |
4.38%, 10/31/2029(a) | | | 240,000 | | | | 200,581 | |
| | |
Prime Healthcare Services, Inc. | | | | | | | | |
7.25%, 11/1/2025(a) | | | 1,500,000 | | | | 1,365,000 | |
See Accompanying Notes to the Financial Statements.
| | | | |
430 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Health Care Providers & Services – (continued) | |
| | |
Radiology Partners, Inc. | | | | | | | | |
9.25%, 2/1/2028(a) | | $ | 2,885,000 | | | $ | 1,085,002 | |
| | |
RegionalCare Hospital Partners Holdings, Inc. | | | | | | | | |
9.75%, 12/1/2026(a) | | | 2,430,000 | | | | 2,272,015 | |
| | |
RP Escrow Issuer LLC | | | | | | | | |
5.25%, 12/15/2025(a) | | | 2,455,000 | | | | 1,749,187 | |
| | |
Team Health Holdings, Inc. | | | | | | | | |
6.38%, 2/1/2025(a) | | | 825,000 | | | | 653,812 | |
| | |
Tenet Healthcare Corp. | | | | | | | | |
6.25%, 2/1/2027 | | | 500,000 | | | | 479,473 | |
5.13%, 11/1/2027 | | | 400,000 | | | | 369,247 | |
6.13%, 10/1/2028 | | | 1,050,000 | | | | 973,875 | |
6.88%, 11/15/2031 | | | 215,000 | | | | 198,213 | |
| | |
Toledo Hospital (The) | | | | | | | | |
Series B, 5.33%, 11/15/2028 | | | 1,795,000 | | | | 1,373,175 | |
| | |
US Acute Care Solutions LLC | | | | | | | | |
6.38%, 3/1/2026(a) | | | 3,963,000 | | | | 3,371,579 | |
| | | | | | | 36,506,999 | |
|
Health Care REITs – 0.2% | |
| | |
CTR Partnership LP | | | | | | | | |
REIT, 3.88%, 6/30/2028(a) | | | 1,300,000 | | | | 1,092,176 | |
| | |
MPT Operating Partnership LP | | | | | | | | |
REIT, 4.63%, 8/1/2029 | | | 2,670,000 | | | | 1,848,525 | |
| | | | | | | 2,940,701 | |
|
Hotel & Resort REITs – 0.4% | |
| | |
Park Intermediate Holdings LLC | | | | | | | | |
REIT, 4.88%, 5/15/2029(a) | | | 1,525,000 | | | | 1,272,757 | |
| | |
RHP Hotel Properties LP | | | | | | | | |
REIT, 4.50%, 2/15/2029(a) | | | 240,000 | | | | 204,286 | |
| | |
Service Properties Trust | | | | | | | | |
REIT, 5.25%, 2/15/2026 | | | 630,000 | | | | 563,441 | |
REIT, 4.75%, 10/1/2026 | | | 1,020,000 | | | | 867,289 | |
REIT, 4.95%, 2/15/2027 | | | 985,000 | | | | 820,166 | |
REIT, 3.95%, 1/15/2028 | | | 705,000 | | | | 527,119 | |
| | |
XHR LP | | | | | | | | |
REIT, 4.88%, 6/1/2029(a) | | | 240,000 | | | | 203,056 | |
| | | | | | | 4,458,114 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Hotels, Restaurants & Leisure – 6.5% | |
| | |
1011778 BC ULC | | | | | | | | |
3.88%, 1/15/2028(a) | | $ | 200,000 | | | $ | 178,559 | |
| | |
Affinity Interactive | | | | | | | | |
6.88%, 12/15/2027(a) | | | 3,055,000 | | | | 2,490,088 | |
| | |
Boyd Gaming Corp. | | | | | | | | |
4.75%, 6/15/2031(a) | | | 3,280,000 | | | | 2,722,068 | |
| | |
Caesars Entertainment, Inc. | | | | | | | | |
8.13%, 7/1/2027(a) | | | 489,000 | | | | 484,537 | |
| | |
Carnival Corp. | | | | | | | | |
7.63%, 3/1/2026(a) | | | 1,140,000 | | | | 1,108,528 | |
5.75%, 3/1/2027(a) | | | 3,000,000 | | | | 2,678,586 | |
| | |
Carnival Holdings Bermuda Ltd. | | | | | | | | |
10.38%, 5/1/2028(a) | | | 1,161,000 | | | | 1,237,875 | |
| | |
CDI Escrow Issuer, Inc. | | | | | | | | |
5.75%, 4/1/2030(a) | | | 760,000 | | | | 678,988 | |
| | |
CEC Entertainment LLC | | | | | | | | |
6.75%, 5/1/2026(a) | | | 844,000 | | | | 788,238 | |
| | |
Cedar Fair LP | | | | | | | | |
5.38%, 4/15/2027 | | | 1,610,000 | | | | 1,490,784 | |
6.50%, 10/1/2028 | | | 995,000 | | | | 920,952 | |
5.25%, 7/15/2029 | | | 806,000 | | | | 694,157 | |
| | |
Churchill Downs, Inc. | | | | | | | | |
5.50%, 4/1/2027(a) | | | 1,350,000 | | | | 1,266,230 | |
4.75%, 1/15/2028(a) | | | 1,255,000 | | | | 1,123,884 | |
6.75%, 5/1/2031(a) | | | 250,000 | | | | 230,625 | |
| | |
Everi Holdings, Inc. | | | | | | | | |
5.00%, 7/15/2029(a) | | | 810,000 | | | | 680,627 | |
| | |
Fertitta Entertainment LLC | | | | | | | | |
4.63%, 1/15/2029(a) | | | 960,000 | | | | 806,717 | |
| | |
Genting New York LLC | | | | | | | | |
3.30%, 2/15/2026(a) | | | 2,700,000 | | | | 2,409,454 | |
| | |
GPS Hospitality Holding Co. LLC | | | | | | | | |
7.00%, 8/15/2028(a) | | | 1,100,000 | | | | 747,620 | |
| | |
Hilton Domestic Operating Co., Inc. | | | | | | | | |
5.38%, 5/1/2025(a) | | | 500,000 | | | | 491,526 | |
3.75%, 5/1/2029(a) | | | 750,000 | | | | 645,597 | |
4.88%, 1/15/2030 | | | 750,000 | | | | 673,294 | |
4.00%, 5/1/2031(a) | | | 1,000,000 | | | | 828,166 | |
3.63%, 2/15/2032(a) | | | 3,140,000 | | | | 2,482,086 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 431 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
Hilton Grand Vacations Borrower Escrow LLC | | | | | | | | |
5.00%, 6/1/2029(a) | | $ | 1,725,000 | | | $ | 1,444,684 | |
4.88%, 7/1/2031(a) | | | 2,755,000 | | | | 2,181,638 | |
| | |
Jacobs Entertainment, Inc. | | | | | | | | |
6.75%, 2/15/2029(a) | | | 1,500,000 | | | | 1,275,000 | |
| | |
KFC Holding Co. | | | | | | | | |
4.75%, 6/1/2027(a) | | | 500,000 | | | | 472,525 | |
| | |
Las Vegas Sands Corp. | | | | | | | | |
3.90%, 8/8/2029 | | | 365,000 | | | | 315,139 | |
| | |
Life Time, Inc. | | | | | | | | |
8.00%, 4/15/2026(a) | | | 1,065,000 | | | | 1,038,375 | |
| | |
Light & Wonder International, Inc. | | | | | | | | |
7.00%, 5/15/2028(a) | | | 450,000 | | | | 438,655 | |
| | |
Marriott Ownership Resorts, Inc. | | | | | | | | |
4.75%, 1/15/2028 | | | 1,236,000 | | | | 1,062,742 | |
4.50%, 6/15/2029(a) | | | 1,305,000 | | | | 1,072,370 | |
| | |
Midwest Gaming Borrower LLC | | | | | | | | |
4.88%, 5/1/2029(a) | | | 4,150,000 | | | | 3,454,875 | |
| | |
Mohegan Tribal Gaming Authority | | | | | | | | |
8.00%, 2/1/2026(a) | | | 6,120,000 | | | | 5,622,750 | |
| | |
Papa John's International, Inc. | | | | | | | | |
3.88%, 9/15/2029(a) | | | 1,300,000 | | | | 1,066,594 | |
| | |
Penn Entertainment, Inc. | | | | | | | | |
5.63%, 1/15/2027(a) | | | 1,030,000 | | | | 939,635 | |
4.13%, 7/1/2029(a) | | | 100,000 | | | | 77,696 | |
| | |
Raptor Acquisition Corp. | | | | | | | | |
4.88%, 11/1/2026(a) | | | 385,000 | | | | 358,242 | |
| | |
Resorts World Las Vegas LLC | | | | | | | | |
4.63%, 4/16/2029(a) | | | 5,250,000 | | | | 4,032,262 | |
8.45%, 7/27/2030(a) | | | 2,500,000 | | | | 2,299,334 | |
4.63%, 4/6/2031(a) | | | 1,655,000 | | | | 1,166,775 | |
| | |
Royal Caribbean Cruises Ltd. | | | | | | | | |
4.25%, 7/1/2026(a) | | | 1,220,000 | | | | 1,121,913 | |
5.50%, 8/31/2026(a) | | | 2,205,000 | | | | 2,080,814 | |
5.38%, 7/15/2027(a) | | | 1,000,000 | | | | 921,576 | |
11.63%, 8/15/2027(a) | | | 2,710,000 | | | | 2,939,171 | |
5.50%, 4/1/2028(a) | | | 1,100,000 | | | | 1,003,037 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Hotels, Restaurants & Leisure – (continued) | |
| | |
SeaWorld Parks & Entertainment, Inc. | | | | | | | | |
5.25%, 8/15/2029(a) | | $ | 1,335,000 | | | $ | 1,162,825 | |
| | |
Six Flags Entertainment Corp. | | | | | | | | |
5.50%, 4/15/2027(a) | | | 1,610,000 | | | | 1,465,696 | |
7.25%, 5/15/2031(a) | | | 800,000 | | | | 736,000 | |
| | |
Sizzling Platter LLC | | | | | | | | |
8.50%, 11/28/2025(a) | | | 330,000 | | | | 328,061 | |
| | |
Station Casinos LLC | | | | | | | | |
4.50%, 2/15/2028(a) | | | 500,000 | | | | 431,813 | |
| | |
TKC Holdings, Inc. | | | | | | | | |
6.88%, 5/15/2028(a) | | | 1,270,000 | | | | 1,098,550 | |
10.50%, 5/15/2029(a) | | | 2,225,000 | | | | 1,779,452 | |
| | |
Travel + Leisure Co. | | | | | | | | |
6.63%, 7/31/2026(a) | | | 1,425,000 | | | | 1,390,429 | |
6.00%, 4/1/2027(e) | | | 795,000 | | | | 742,526 | |
4.50%, 12/1/2029(a) | | | 360,000 | | | | 296,707 | |
4.63%, 3/1/2030(a) | | | 35,000 | | | | 28,653 | |
| | |
Wynn Resorts Finance LLC | | | | | | | | |
5.13%, 10/1/2029(a) | | | 380,000 | | | | 324,066 | |
7.13%, 2/15/2031(a) | | | 500,000 | | | | 465,611 | |
| | |
Yum! Brands, Inc. | | | | | | | | |
4.75%, 1/15/2030(a) | | | 2,300,000 | | | | 2,047,483 | |
3.63%, 3/15/2031 | | | 930,000 | | | | 755,181 | |
4.63%, 1/31/2032 | | | 855,000 | | | | 728,526 | |
5.38%, 4/1/2032 | | | 590,000 | | | | 530,356 | |
6.88%, 11/15/2037 | | | 820,000 | | | | 809,511 | |
| | | | | | | 79,366,434 | |
|
Household Durables – 1.2% | |
| | |
Ashton Woods USA LLC | | | | | | | | |
6.63%, 1/15/2028(a) | | | 465,000 | | | | 425,475 | |
4.63%, 4/1/2030(a) | | | 745,000 | | | | 576,856 | |
| | |
Brookfield Residential Properties, Inc. | | | | | | | | |
6.25%, 9/15/2027(a) | | | 2,040,000 | | | | 1,774,839 | |
| | |
CD&R Smokey Buyer, Inc. | | | | | | | | |
6.75%, 7/15/2025(a) | | | 1,250,000 | | | | 1,194,750 | |
| | |
Empire Communities Corp. | | | | | | | | |
7.00%, 12/15/2025(a) | | | 505,000 | | | | 469,352 | |
| | |
Installed Building Products, Inc. | | | | | | | | |
5.75%, 2/1/2028(a) | | | 285,000 | | | | 257,124 | |
| | |
KB Home | | | | | | | | |
4.00%, 6/15/2031 | | | 90,000 | | | | 70,273 | |
See Accompanying Notes to the Financial Statements.
| | | | |
432 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Household Durables – (continued) | |
| | |
LGI Homes, Inc. | | | | | | | | |
4.00%, 7/15/2029(a) | | $ | 1,115,000 | | | $ | 853,212 | |
| | |
M/I Homes, Inc. | | | | | | | | |
3.95%, 2/15/2030 | | | 5,000 | | | | 3,977 | |
| | |
Mattamy Group Corp. | | | | | | | | |
5.25%, 12/15/2027(a) | | | 870,000 | | | | 781,660 | |
4.63%, 3/1/2030(a) | | | 1,725,000 | | | | 1,408,391 | |
| | |
Shea Homes LP | | | | | | | | |
4.75%, 2/15/2028 | | | 810,000 | | | | 711,895 | |
4.75%, 4/1/2029 | | | 495,000 | | | | 417,863 | |
| | |
SWF Escrow Issuer Corp. | | | | | | | | |
6.50%, 10/1/2029(a) | | | 1,965,000 | | | | 1,164,015 | |
| | |
Taylor Morrison Communities, Inc. | | | | | | | | |
5.75%, 1/15/2028(a) | | | 1,060,000 | | | | 962,110 | |
5.13%, 8/1/2030(a) | | | 360,000 | | | | 302,545 | |
| | |
Tempur Sealy International, Inc. | | | | | | | | |
4.00%, 4/15/2029(a) | | | 540,000 | | | | 443,013 | |
3.88%, 10/15/2031(a) | | | 3,670,000 | | | | 2,748,384 | |
| | |
TopBuild Corp. | | | | | | | | |
4.13%, 2/15/2032(a) | | | 175,000 | | | | 138,442 | |
| | |
Tri Pointe Homes, Inc. | | | | | | | | |
5.70%, 6/15/2028 | | | 580,000 | | | | 516,403 | |
| | | | | | | 15,220,579 | |
|
Household Products – 0.2% | |
| | |
Central Garden & Pet Co. | | | | | | | | |
4.13%, 10/15/2030 | | | 250,000 | | | | 203,901 | |
4.13%, 4/30/2031(a) | | | 100,000 | | | | 79,552 | |
| | |
Energizer Holdings, Inc. | | | | | | | | |
6.50%, 12/31/2027(a) | | | 490,000 | | | | 456,765 | |
4.75%, 6/15/2028(a) | | | 1,290,000 | | | | 1,101,840 | |
4.38%, 3/31/2029(a) | | | 425,000 | | | | 346,937 | |
| | |
Kronos Acquisition Holdings, Inc. | | | | | | | | |
5.00%, 12/31/2026(a) | | | 220,000 | | | | 199,001 | |
| | | | | | | 2,387,996 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Independent Power and Renewable Electricity Producers – 0.1% | |
| | |
Clearway Energy Operating LLC | | | | | | | | |
3.75%, 2/15/2031(a) | | $ | 795,000 | | | $ | 619,900 | |
| | |
Talen Energy Supply LLC | | | | | | | | |
8.63%, 6/1/2030(a) | | | 1,000,000 | | | | 1,016,109 | |
| | |
TransAlta Corp. | | | | | | | | |
6.50%, 3/15/2040 | | | 230,000 | | | | 202,700 | |
| | | | | | | 1,838,709 | |
|
Insurance – 0.5% | |
| | |
Assurant, Inc. | | | | | | | | |
7.00%, 3/27/2048(c) | | | 665,000 | | | | 636,928 | |
| | |
Constellation Insurance, Inc. | | | | | | | | |
6.80%, 1/24/2030(a)(e) | | | 220,000 | | | | 188,220 | |
6.63%, 5/1/2031(a) | | | 1,000,000 | | | | 866,063 | |
| | |
Global Atlantic Fin Co. | | | | | | | | |
4.70%, 10/15/2051(a)(c) | | | 3,715,000 | | | | 2,584,776 | |
| | |
Liberty Mutual Group, Inc. | | | | | | | | |
7.80%, 3/15/2037(a) | | | 75,000 | | | | 72,103 | |
4.13%, 12/15/2051(a)(c) | | | 1,625,000 | | | | 1,290,104 | |
| | | | | | | 5,638,194 | |
|
Interactive Media & Services – 0.6% | |
| | |
Cars.com, Inc. | | | | | | | | |
6.38%, 11/1/2028(a) | | | 936,000 | | | | 833,040 | |
| | |
Rackspace Technology Global, Inc. | | | | | | | | |
3.50%, 2/15/2028(a) | | | 3,045,000 | | | | 1,334,736 | |
5.38%, 12/1/2028(a) | | | 1,810,000 | | | | 529,281 | |
| | |
Ziff Davis, Inc. | | | | | | | | |
4.63%, 10/15/2030(a) | | | 2,450,000 | | | | 2,051,185 | |
| | |
ZipRecruiter, Inc. | | | | | | | | |
5.00%, 1/15/2030(a) | | | 2,820,000 | | | | 2,202,505 | |
| | | | | | | 6,950,747 | |
|
IT Services – 0.5% | |
| | |
Acuris Finance US, Inc. | | | | | | | | |
5.00%, 5/1/2028(a) | | | 1,129,000 | | | | 889,088 | |
| | |
Cogent Communications Group, Inc. | | | | | | | | |
3.50%, 5/1/2026(a) | | | 950,000 | | | | 859,984 | |
7.00%, 6/15/2027(a) | | | 825,000 | | | | 779,625 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 433 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
IT Services – (continued) | |
| | |
Conduent Business Services LLC | | | | | | | | |
6.00%, 11/1/2029(a) | | $ | 1,500,000 | | | $ | 1,236,497 | |
| | |
Gartner, Inc. | | | | | | | | |
4.50%, 7/1/2028(a) | | | 1,615,000 | | | | 1,453,045 | |
3.63%, 6/15/2029(a) | | | 250,000 | | | | 211,114 | |
3.75%, 10/1/2030(a) | | | 545,000 | | | | 451,091 | |
| | |
ION Trading Technologies Sarl | | | | | | | | |
5.75%, 5/15/2028(a) | | | 740,000 | | | | 614,200 | |
| | | | | | | 6,494,644 | |
|
Machinery – 1.1% | |
| | |
Amsted Industries, Inc. | | | | | | | | |
4.63%, 5/15/2030(a) | | | 200,000 | | | | 161,347 | |
| | |
Calderys Financing LLC | | | | | | | | |
11.25%, 6/1/2028(a) | | | 880,000 | | | | 887,700 | |
| | |
GrafTech Finance, Inc. | | | | | | | | |
4.63%, 12/15/2028(a) | | | 2,495,000 | | | | 1,828,935 | |
| | |
GrafTech Global Enterprises, Inc. | | | | | | | | |
9.88%, 12/15/2028(a) | | | 2,400,000 | | | | 2,149,171 | |
| | |
Hillenbrand, Inc. | | | | | | | | |
5.00%, 9/15/2026(e) | | | 660,000 | | | | 632,980 | |
| | |
Husky III Holding Ltd. | | | | | | | | |
13.00%, 2/15/2025(a)(b) | | | 800,000 | | | | 770,000 | |
| | |
Interpipe Holdings plc | | | | | | | | |
8.38%, 5/13/2026(a) | | | 1,500,000 | | | | 1,095,000 | |
| | |
Manitowoc Co., Inc. (The) | | | | | | | | |
9.00%, 4/1/2026(a) | | | 200,000 | | | | 196,041 | |
| | |
OT Merger Corp. | | | | | | | | |
7.88%, 10/15/2029(a) | | | 1,580,000 | | | | 940,100 | |
| | |
Terex Corp. | | | | | | | | |
5.00%, 5/15/2029(a) | | | 1,175,000 | | | | 1,028,532 | |
| | |
Titan International, Inc. | | | | | | | | |
7.00%, 4/30/2028 | | | 926,000 | | | | 846,150 | |
| | |
TK Elevator US Newco, Inc. | | | | | | | | |
5.25%, 7/15/2027(a) | | | 2,235,000 | | | | 2,034,850 | |
| | |
Wabash National Corp. | | | | | | | | |
4.50%, 10/15/2028(a) | | | 1,365,000 | | | | 1,129,538 | |
| | | | | | | 13,700,344 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Media – 8.8% | |
| | |
Advantage Sales & Marketing, Inc. | | | | | | | | |
6.50%, 11/15/2028(a) | | $ | 1,575,000 | | | $ | 1,283,625 | |
| | |
Altice Financing SA | | | | | | | | |
5.00%, 1/15/2028(a) | | | 1,695,000 | | | | 1,378,487 | |
5.75%, 8/15/2029(a) | | | 4,000,000 | | | | 3,093,231 | |
| | |
AMC Networks, Inc. | | | | | | | | |
4.25%, 2/15/2029 | | | 3,030,000 | | | | 1,861,601 | |
| | |
Belo Corp. | | | | | | | | |
7.75%, 6/1/2027 | | | 625,000 | | | | 611,854 | |
7.25%, 9/15/2027 | | | 645,000 | | | | 614,679 | |
| | |
Cable One, Inc. | | | | | | | | |
4.00%, 11/15/2030(a) | | | 250,000 | | | | 186,250 | |
| | |
CMG Media Corp. | | | | | | | | |
8.88%, 12/15/2027(a) | | | 2,890,000 | | | | 2,232,525 | |
| | |
CSC Holdings LLC | | | | | | | | |
7.50%, 4/1/2028(a) | | | 5,500,000 | | | | 3,525,104 | |
5.75%, 1/15/2030(a) | | | 2,000,000 | | | | 1,046,339 | |
| | |
Directv Financing LLC | | | | | | | | |
5.88%, 8/15/2027(a) | | | 3,675,000 | | | | 3,220,164 | |
| | |
DISH DBS Corp. | | | | | | | | |
5.88%, 11/15/2024 | | | 4,425,000 | | | | 4,060,007 | |
7.75%, 7/1/2026 | | | 10,592,000 | | | | 7,097,391 | |
5.25%, 12/1/2026(a) | | | 1,630,000 | | | | 1,314,841 | |
7.38%, 7/1/2028 | | | 5,454,000 | | | | 3,080,080 | |
5.75%, 12/1/2028(a) | | | 1,005,000 | | | | 729,881 | |
5.13%, 6/1/2029 | | | 8,069,000 | | | | 4,155,535 | |
| | |
DISH Network Corp. | | | | | | | | |
11.75%, 11/15/2027(a) | | | 2,915,000 | | | | 2,887,482 | |
| | |
Gannett Holdings LLC | | | | | | | | |
6.00%, 11/1/2026(a) | | | 355,000 | | | | 298,200 | |
| | |
GCI LLC | | | | | | | | |
4.75%, 10/15/2028(a) | | | 1,985,000 | | | | 1,703,329 | |
| | |
Gray Escrow II, Inc. | | | | | | | | |
5.38%, 11/15/2031(a) | | | 7,050,000 | | | | 4,443,272 | |
| | |
Gray Television, Inc. | | | | | | | | |
7.00%, 5/15/2027(a) | | | 1,560,000 | | | | 1,322,755 | |
4.75%, 10/15/2030(a) | | | 695,000 | | | | 445,591 | |
| | |
Lamar Media Corp. | | | | | | | | |
4.00%, 2/15/2030 | | | 250,000 | | | | 211,525 | |
3.63%, 1/15/2031 | | | 500,000 | | | | 404,155 | |
| | |
News Corp. | | | | | | | | |
5.13%, 2/15/2032(a) | | | 300,000 | | | | 259,065 | |
See Accompanying Notes to the Financial Statements.
| | | | |
434 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Media – (continued) | |
| | |
Nexstar Media, Inc. | | | | | | | | |
5.63%, 7/15/2027(a) | | $ | 3,520,000 | | | $ | 3,167,861 | |
4.75%, 11/1/2028(a) | | | 530,000 | | | | 445,141 | |
| | |
Paramount Global | | | | | | | | |
6.25%, 2/28/2057(c) | | | 1,160,000 | | | | 832,300 | |
6.38%, 3/30/2062(c) | | | 2,170,000 | | | | 1,596,990 | |
| | |
Radiate Holdco LLC | | | | | | | | |
4.50%, 9/15/2026(a) | | | 1,940,000 | | | | 1,483,400 | |
6.50%, 9/15/2028(a) | | | 4,750,000 | | | | 2,351,250 | |
| | |
Scripps Escrow II, Inc. | | | | | | | | |
5.38%, 1/15/2031(a) | | | 100,000 | | | | 62,092 | |
| | |
Scripps Escrow, Inc. | | | | | | | | |
5.88%, 7/15/2027(a) | | | 1,337,000 | | | | 999,408 | |
| | |
Sinclair Television Group, Inc. | | | | | | | | |
5.13%, 2/15/2027(a) | | | 871,000 | | | | 683,735 | |
5.50%, 3/1/2030(a) | | | 2,786,000 | | | | 1,512,519 | |
4.13%, 12/1/2030(a) | | | 2,250,000 | | | | 1,421,753 | |
| | |
Sirius XM Radio, Inc. | | | | | | | | |
3.13%, 9/1/2026(a) | | | 1,695,000 | | | | 1,520,025 | |
5.00%, 8/1/2027(a) | | | 3,120,000 | | | | 2,860,728 | |
4.00%, 7/15/2028(a) | | | 1,695,000 | | | | 1,441,483 | |
5.50%, 7/1/2029(a) | | | 2,385,000 | | | | 2,113,286 | |
4.13%, 7/1/2030(a) | | | 7,895,000 | | | | 6,268,748 | |
3.88%, 9/1/2031(a) | | | 7,795,000 | | | | 5,871,095 | |
| | |
Summer BC Bidco B LLC | | | | | | | | |
5.50%, 10/31/2026(a) | | | 2,260,000 | | | | 1,968,121 | |
| | |
TEGNA, Inc. | | | | | | | | |
4.75%, 3/15/2026(a) | | | 535,000 | | | | 499,226 | |
4.63%, 3/15/2028 | | | 1,967,000 | | | | 1,696,537 | |
5.00%, 9/15/2029 | | | 850,000 | | | | 711,875 | |
| | |
Townsquare Media, Inc. | | | | | | | | |
6.88%, 2/1/2026(a) | | | 870,000 | | | | 804,279 | |
| | |
Univision Communications, Inc. | | | | | | | | |
6.63%, 6/1/2027(a) | | | 250,000 | | | | 228,349 | |
7.38%, 6/30/2030(a) | | | 645,000 | | | | 567,928 | |
| | |
UPC Broadband Finco BV | | | | | | | | |
4.88%, 7/15/2031(a) | | | 1,000,000 | | | | 798,420 | |
| | |
UPC Holding BV | | | | | | | | |
5.50%, 1/15/2028(a) | | | 934,000 | | | | 814,915 | |
| | |
Urban One, Inc. | | | | | | | | |
7.38%, 2/1/2028(a) | | | 511,000 | | | | 420,155 | |
| | |
Videotron Ltd. | | | | | | | | |
3.63%, 6/15/2029(a) | | | 300,000 | | | | 252,840 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Media – (continued) | |
| | |
Virgin Media Vendor Financing Notes IV DAC | | | | | | | | |
5.00%, 7/15/2028(a) | | $ | 1,225,000 | | | $ | 1,040,105 | |
| | |
VZ Secured Financing BV | | | | | | | | |
5.00%, 1/15/2032(a) | | | 8,010,000 | | | | 6,077,387 | |
| | |
Ziggo Bond Co. BV | | | | | | | | |
5.13%, 2/28/2030(a) | | | 1,848,000 | | | | 1,346,442 | |
| | |
Ziggo BV | | | | | | | | |
4.88%, 1/15/2030(a) | | | 5,120,000 | | | | 4,087,800 | |
| | | | | | | 107,413,161 | |
|
Metals & Mining – 2.1% | |
| | |
Allegheny Ludlum LLC | | | | | | | | |
6.95%, 12/15/2025 | | | 195,000 | | | | 194,020 | |
| | |
Arsenal AIC Parent LLC | | | | | | | | |
8.00%, 10/1/2030(a) | | | 600,000 | | | | 592,500 | |
| | |
ATI, Inc. | | | | | | | | |
5.88%, 12/1/2027 | | | 800,000 | | | | 742,216 | |
5.13%, 10/1/2031 | | | 280,000 | | | | 231,000 | |
| | |
Baffinland Iron Mines Corp. | | | | | | | | |
8.75%, 7/15/2026(a) | | | 1,960,000 | | | | 1,884,003 | |
| | |
Cleveland-Cliffs, Inc. | | | | | | | | |
6.75%, 4/15/2030(a) | | | 585,000 | | | | 542,406 | |
| | |
Compass Minerals International, Inc. | | | | | | | | |
6.75%, 12/1/2027(a) | | | 1,025,000 | | | | 965,499 | |
| | |
FMG Resources August 2006 Pty. Ltd. | | | | | | | | |
4.50%, 9/15/2027(a) | | | 250,000 | | | | 225,102 | |
5.88%, 4/15/2030(a) | | | 3,625,000 | | | | 3,253,068 | |
4.38%, 4/1/2031(a) | | | 2,990,000 | | | | 2,409,700 | |
6.13%, 4/15/2032(a) | | | 4,115,000 | | | | 3,632,019 | |
| | |
Hecla Mining Co. | | | | | | | | |
7.25%, 2/15/2028 | | | 1,025,000 | | | | 978,620 | |
| | |
Hudbay Minerals, Inc. | | | | | | | | |
4.50%, 4/1/2026(a) | | | 1,280,000 | | | | 1,191,314 | |
| | |
Kaiser Aluminum Corp. | | | | | | | | |
4.63%, 3/1/2028(a) | | | 840,000 | | | | 699,945 | |
| | |
Mineral Resources Ltd. | | | | | | | | |
8.13%, 5/1/2027(a) | | | 1,260,000 | | | | 1,225,792 | |
8.00%, 11/1/2027(a) | | | 1,210,000 | | | | 1,169,211 | |
9.25%, 10/1/2028(a) | | | 1,000,000 | | | | 1,000,000 | |
8.50%, 5/1/2030(a) | | | 743,000 | | | | 711,356 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 435 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Metals & Mining – (continued) | |
| | |
Novelis Corp. | | | | | | | | |
3.25%, 11/15/2026(a) | | $ | 500,000 | | | $ | 445,071 | |
3.88%, 8/15/2031(a) | | | 600,000 | | | | 468,600 | |
| | |
SunCoke Energy, Inc. | | | | | | | | |
4.88%, 6/30/2029(a) | | | 1,720,000 | | | | 1,439,640 | |
| | |
TMS International Corp. | | | | | | | | |
6.25%, 4/15/2029(a) | | | 1,945,000 | | | | 1,534,513 | |
| | |
Warrior Met Coal, Inc. | | | | | | | | |
7.88%, 12/1/2028(a) | | | 56,000 | | | | 54,617 | |
| | | | | | | 25,590,212 | |
|
Mortgage Real Estate Investment Trusts (REITs) – 0.7% | |
| | |
Apollo Commercial Real Estate Finance, Inc. | | | | | | | | |
4.63%, 6/15/2029(a) | | | 160,000 | | | | 122,473 | |
| | |
Blackstone Mortgage Trust, Inc. | | | | | | | | |
3.75%, 1/15/2027(a) | | | 1,245,000 | | | | 1,035,261 | |
| | |
Ladder Capital Finance Holdings LLLP | | | | | | | | |
5.25%, 10/1/2025(a) | | | 654,000 | | | | 621,675 | |
4.25%, 2/1/2027(a) | | | 1,580,000 | | | | 1,380,265 | |
4.75%, 6/15/2029(a) | | | 3,125,000 | | | | 2,512,506 | |
| | |
Rithm Capital Corp. | | | | | | | | |
6.25%, 10/15/2025(a) | | | 1,175,000 | | | | 1,112,118 | |
| | |
Starwood Property Trust, Inc. | | | | | | | | |
3.63%, 7/15/2026(a) | | | 825,000 | | | | 728,533 | |
4.38%, 1/15/2027(a) | | | 1,755,000 | | | | 1,505,632 | |
| | | | | | | 9,018,463 | |
|
Multi-Utilities – 0.3% | |
| | |
Algonquin Power & Utilities Corp. | | | | | | | | |
4.75%, 1/18/2082(c) | | | 4,000,000 | | | | 3,157,760 | |
|
Office REITs – 0.4% | |
| | |
Office Properties Income Trust | | | | | | | | |
REIT, 4.50%, 2/1/2025 | | | 3,650,000 | | | | 3,120,750 | |
REIT, 2.65%, 6/15/2026 | | | 1,600,000 | | | | 1,051,960 | |
REIT, 3.45%, 10/15/2031 | | | 2,250,000 | | | | 1,102,500 | |
| | | | | | | 5,275,210 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – 11.6% | |
| | |
Aethon United BR LP | | | | | | | | |
8.25%, 2/15/2026(a) | | $ | 930,000 | | | $ | 923,806 | |
| | |
Antero Midstream Partners LP | | | | | | | | |
5.75%, 3/1/2027(a) | | | 1,464,000 | | | | 1,399,251 | |
5.75%, 1/15/2028(a) | | | 1,145,000 | | | | 1,073,428 | |
5.38%, 6/15/2029(a) | | | 1,515,000 | | | | 1,375,693 | |
| | |
Ascent Resources Utica Holdings LLC | | | | | | | | |
7.00%, 11/1/2026(a) | | | 855,000 | | | | 825,664 | |
| | |
Athabasca Oil Corp. | | | | | | | | |
9.75%, 11/1/2026(a) | | | 174,000 | | | | 179,335 | |
| | |
Baytex Energy Corp. | | | | | | | | |
8.75%, 4/1/2027(a) | | | 780,000 | | | | 786,140 | |
8.50%, 4/30/2030(a) | | | 1,750,000 | | | | 1,733,282 | |
| | |
Berry Petroleum Co. LLC | | | | | | | | |
7.00%, 2/15/2026(a) | | | 330,000 | | | | 316,800 | |
| | |
Buckeye Partners LP | | | | | | | | |
4.13%, 3/1/2025(a) | | | 240,000 | | | | 228,552 | |
3.95%, 12/1/2026 | | | 805,000 | | | | 733,693 | |
4.13%, 12/1/2027 | | | 1,650,000 | | | | 1,433,520 | |
4.50%, 3/1/2028(a) | | | 465,000 | | | | 404,550 | |
5.85%, 11/15/2043 | | | 100,000 | | | | 70,668 | |
| | |
Chesapeake Energy Corp. | | | | | | | | |
5.88%, 2/1/2029(a) | | | 960,000 | | | | 903,851 | |
| | |
Chord Energy Corp. | | | | | | | | |
6.38%, 6/1/2026(a) | | | 500,000 | | | | 490,870 | |
| | |
Civitas Resources, Inc. | | | | | | | | |
5.00%, 10/15/2026(a) | | | 665,000 | | | | 622,218 | |
8.38%, 7/1/2028(a) | | | 1,025,000 | | | | 1,031,315 | |
8.75%, 7/1/2031(a) | | | 2,890,000 | | | | 2,916,780 | |
| | |
CNX Midstream Partners LP | | | | | | | | |
4.75%, 4/15/2030(a) | | | 1,260,000 | | | | 1,038,086 | |
| | |
CNX Resources Corp. | | | | | | | | |
7.25%, 3/14/2027(a) | | | 600,000 | | | | 590,474 | |
6.00%, 1/15/2029(a) | | | 995,000 | | | | 912,372 | |
7.38%, 1/15/2031(a) | | | 1,070,000 | | | | 1,022,359 | |
| | |
Conuma Resources Ltd. | | | | | | | | |
13.13%, 5/1/2028(a) | | | 750,000 | | | | 693,461 | |
| | |
CQP Holdco LP | | | | | | | | |
5.50%, 6/15/2031(a) | | | 1,365,000 | | | | 1,187,210 | |
| | |
Crescent Energy Finance LLC | | | | | | | | |
7.25%, 5/1/2026(a) | | | 2,160,000 | | | | 2,091,096 | |
9.25%, 2/15/2028(a) | | | 1,995,000 | | | | 2,009,286 | |
See Accompanying Notes to the Financial Statements.
| | | | |
436 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
CVR Energy, Inc. | | | | | | | | |
5.75%, 2/15/2028(a) | | $ | 800,000 | | | $ | 718,768 | |
| | |
Delek Logistics Partners LP | | | | | | | | |
7.13%, 6/1/2028(a) | | | 2,120,000 | | | | 1,929,200 | |
| | |
DT Midstream, Inc. | | | | | | | | |
4.13%, 6/15/2029(a) | | | 845,000 | | | | 726,539 | |
4.38%, 6/15/2031(a) | | | 545,000 | | | | 452,600 | |
| | |
Encino Acquisition Partners Holdings LLC | | | | | | | | |
8.50%, 5/1/2028(a) | | | 2,270,000 | | | | 2,213,250 | |
| | |
Energean plc | | | | | | | | |
6.50%, 4/30/2027(a) | | | 2,200,000 | | | | 1,830,180 | |
| | |
EnQuest plc | | | | | | | | |
11.63%, 11/1/2027(a) | | | 1,550,000 | | | | 1,457,303 | |
| | |
Genesis Energy LP | | | | | | | | |
6.25%, 5/15/2026 | | | 815,000 | | | | 776,728 | |
8.00%, 1/15/2027 | | | 2,540,000 | | | | 2,439,040 | |
7.75%, 2/1/2028 | | | 1,480,000 | | | | 1,393,589 | |
8.88%, 4/15/2030 | | | 515,000 | | | | 497,854 | |
| | |
Global Partners LP | | | | | | | | |
7.00%, 8/1/2027 | | | 1,060,000 | | | | 999,113 | |
6.88%, 1/15/2029 | | | 2,070,000 | | | | 1,826,883 | |
| | |
Gran Tierra Energy, Inc. | | | | | | | | |
9.50%, 10/15/2029(a) | | | 1,682,000 | | | | 1,444,687 | |
| | |
Gulfport Energy Corp. | | | | | | | | |
8.00%, 5/17/2026(a) | | | 249,000 | | | | 248,572 | |
| | |
Harbour Energy plc | | | | | | | | |
5.50%, 10/15/2026(a) | | | 610,000 | | | | 565,050 | |
| | |
Harvest Midstream I LP | | | | | | | | |
7.50%, 9/1/2028(a) | | | 4,010,000 | | | | 3,799,687 | |
| | |
Hilcorp Energy I LP | | | | | | | | |
6.25%, 11/1/2028(a) | | | 825,000 | | | | 771,328 | |
5.75%, 2/1/2029(a) | | | 3,040,000 | | | | 2,736,851 | |
6.00%, 4/15/2030(a) | | | 1,600,000 | | | | 1,420,448 | |
6.00%, 2/1/2031(a) | | | 1,285,000 | | | | 1,125,626 | |
6.25%, 4/15/2032(a) | | | 250,000 | | | | 218,325 | |
| | |
Holly Energy Partners LP | | | | | | | | |
6.38%, 4/15/2027(a) | | | 1,060,000 | | | | 1,026,173 | |
5.00%, 2/1/2028(a) | | | 1,190,000 | | | | 1,101,565 | |
| | |
Howard Midstream Energy Partners LLC | | | | | | | | |
6.75%, 1/15/2027(a) | | | 515,000 | | | | 486,726 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
Ithaca Energy North Sea plc | | | | | | | | |
9.00%, 7/15/2026(a) | | $ | 3,368,000 | | | $ | 3,233,381 | |
| | |
ITT Holdings LLC | | | | | | | | |
6.50%, 8/1/2029(a) | | | 6,287,000 | | | | 5,257,504 | |
| | |
Magnolia Oil & Gas Operating LLC | | | | | | | | |
6.00%, 8/1/2026(a) | | | 230,000 | | | | 220,800 | |
| | |
Martin Midstream Partners LP | | | | | | | | |
11.50%, 2/15/2028(a) | | | 2,100,000 | | | | 2,047,564 | |
| | |
Matador Resources Co. | | | | | | | | |
5.88%, 9/15/2026 | | | 1,250,000 | | | | 1,204,492 | |
| | |
Moss Creek Resources Holdings, Inc. | | | | | | | | |
7.50%, 1/15/2026(a) | | | 3,545,000 | | | | 3,386,205 | |
10.50%, 5/15/2027(a) | | | 1,945,000 | | | | 1,923,013 | |
| | |
Murphy Oil Corp. | | | | | | | | |
7.05%, 5/1/2029 | | | 420,000 | | | | 411,823 | |
5.87%, 12/1/2042(e) | | | 285,000 | | | | 218,966 | |
| | |
New Fortress Energy, Inc. | | | | | | | | |
6.75%, 9/15/2025(a) | | | 3,935,000 | | | | 3,650,634 | |
| | |
NGL Energy Partners LP | | | | | | | | |
7.50%, 4/15/2026 | | | 859,000 | | | | 815,476 | |
| | |
Northern Oil and Gas, Inc. | | | | | | | | |
8.13%, 3/1/2028(a) | | | 1,580,000 | | | | 1,560,297 | |
8.75%, 6/15/2031(a) | | | 200,000 | | | | 198,990 | |
| | |
Northriver Midstream Finance LP | | | | | | | | |
5.63%, 2/15/2026(a) | | | 2,966,000 | | | | 2,802,870 | |
| | |
NuStar Logistics LP | | | | | | | | |
5.75%, 10/1/2025 | | | 1,040,000 | | | | 1,006,498 | |
6.00%, 6/1/2026 | | | 795,000 | | | | 767,064 | |
6.38%, 10/1/2030 | | | 190,000 | | | | 175,750 | |
| | |
Parkland Corp. | | | | | | | | |
5.88%, 7/15/2027(a) | | | 1,055,000 | | | | 1,010,114 | |
4.50%, 10/1/2029(a) | | | 1,510,000 | | | | 1,298,751 | |
4.63%, 5/1/2030(a) | | | 500,000 | | | | 426,250 | |
| | |
PBF Holding Co. LLC | | | | | | | | |
6.00%, 2/15/2028 | | | 1,415,000 | | | | 1,300,813 | |
7.88%, 9/15/2030(a) | | | 300,000 | | | | 289,502 | |
| | |
Rockies Express Pipeline LLC | | | | | | | | |
3.60%, 5/15/2025(a) | | | 160,000 | | | | 151,405 | |
4.95%, 7/15/2029(a) | | | 145,000 | | | | 127,793 | |
4.80%, 5/15/2030(a) | | | 70,000 | | | | 58,846 | |
7.50%, 7/15/2038(a) | | | 770,000 | | | | 711,749 | |
6.88%, 4/15/2040(a) | | | 130,000 | | | | 108,201 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 437 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – (continued) | |
| | |
SM Energy Co. | | | | | | | | |
6.75%, 9/15/2026 | | $ | 755,000 | | | $ | 741,568 | |
6.63%, 1/15/2027 | | | 720,000 | | | | 699,648 | |
| | |
Strathcona Resources Ltd. | | | | | | | | |
6.88%, 8/1/2026(a) | | | 2,525,000 | | | | 2,329,313 | |
| | |
Sunoco LP | | | | | | | | |
5.88%, 3/15/2028 | | | 985,000 | | | | 931,802 | |
7.00%, 9/15/2028(a) | | | 500,000 | | | | 486,610 | |
4.50%, 5/15/2029 | | | 2,305,000 | | | | 1,996,665 | |
4.50%, 4/30/2030 | | | 2,375,000 | | | | 2,028,545 | |
| | |
Tallgrass Energy Partners LP | | | | | | | | |
7.50%, 10/1/2025(a) | | | 275,000 | | | | 270,917 | |
6.00%, 3/1/2027(a) | | | 2,376,000 | | | | 2,173,792 | |
5.50%, 1/15/2028(a) | | | 4,090,000 | | | | 3,583,046 | |
6.00%, 12/31/2030(a) | | | 3,635,000 | | | | 3,060,064 | |
6.00%, 9/1/2031(a) | | | 2,500,000 | | | | 2,103,675 | |
| | |
Teine Energy Ltd. | | | | | | | | |
6.88%, 4/15/2029(a) | | | 905,000 | | | | 838,256 | |
| | |
TerraForm Power Operating LLC | | | | | | | | |
5.00%, 1/31/2028(a) | | | 1,212,000 | | | | 1,110,337 | |
| | |
Topaz Solar Farms LLC | | | | | | | | |
4.88%, 9/30/2039(a) | | | 500,000 | | | | 447,500 | |
5.75%, 9/30/2039(a) | | | 1,847,991 | | | | 1,675,444 | |
| | |
Venture Global Calcasieu Pass LLC | | | | | | | | |
3.88%, 8/15/2029(a) | | | 825,000 | | | | 686,547 | |
6.25%, 1/15/2030(a) | | | 845,000 | | | | 797,138 | |
3.88%, 11/1/2033(a) | | | 920,000 | | | | 695,196 | |
| | |
Venture Global LNG, Inc. | | | | | | | | |
8.13%, 6/1/2028(a) | | | 11,590,000 | | | | 11,251,816 | |
8.38%, 6/1/2031(a) | | | 5,415,000 | | | | 5,167,291 | |
| | |
Vermilion Energy, Inc. | | | | | | | | |
6.88%, 5/1/2030(a) | | | 1,025,000 | | | | 956,202 | |
| | |
Vital Energy, Inc. | | | | | | | | |
10.13%, 1/15/2028 | | | 1,000,000 | | | | 1,002,636 | |
7.75%, 7/31/2029(a) | | | 1,515,000 | | | | 1,371,766 | |
| | |
W&T Offshore, Inc. | | | | | | | | |
11.75%, 2/1/2026(a) | | | 1,395,000 | | | | 1,436,306 | |
| | | | | | | 141,406,676 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Paper & Forest Products – 0.3% | |
| | |
Clearwater Paper Corp. | | | | | | | | |
4.75%, 8/15/2028(a) | | $ | 445,000 | | | $ | 392,726 | |
| | |
Domtar Corp. | | | | | | | | |
6.75%, 10/1/2028(a) | | | 3,610,000 | | | | 2,937,682 | |
| | |
Louisiana-Pacific Corp. | | | | | | | | |
3.63%, 3/15/2029(a) | | | 910,000 | | | | 749,544 | |
| | | | | | | 4,079,952 | |
|
Passenger Airlines – 1.3% | |
| | |
Air Canada | | | | | | | | |
3.88%, 8/15/2026(a) | | | 2,390,000 | | | | 2,174,570 | |
| | |
Allegiant Travel Co. | | | | | | | | |
7.25%, 8/15/2027(a) | | | 1,100,000 | | | | 995,500 | |
| | |
American Airlines Group, Inc. | | | | | | | | |
3.75%, 3/1/2025(a) | | | 500,000 | | | | 466,506 | |
| | |
American Airlines, Inc. | | | | | | | | |
11.75%, 7/15/2025(a) | | | 1,030,000 | | | | 1,091,284 | |
5.50%, 4/20/2026(a) | | | 2,208,333 | | | | 2,147,490 | |
7.25%, 2/15/2028(a) | | | 1,560,000 | | | | 1,450,523 | |
5.75%, 4/20/2029(a) | | | 2,000,000 | | | | 1,804,110 | |
| | |
Spirit Loyalty Cayman Ltd. | | | | | | | | |
8.00%, 9/20/2025(a) | | | 3,935,000 | | | | 2,902,063 | |
| | |
United Airlines, Inc. | | | | | | | | |
4.38%, 4/15/2026(a) | | | 1,830,000 | | | | 1,697,534 | |
4.63%, 4/15/2029(a) | | | 945,000 | | | | 798,245 | |
| | | | | | | 15,527,825 | |
|
Personal Care Products – 1.0% | |
| | |
BellRing Brands, Inc. | | | | | | | | |
7.00%, 3/15/2030(a) | | | 4,250,000 | | | | 4,127,813 | |
| | |
Coty, Inc. | | | | | | | | |
4.75%, 1/15/2029(a) | | | 250,000 | | | | 221,307 | |
| | |
Edgewell Personal Care Co. | | | | | | | | |
5.50%, 6/1/2028(a) | | | 1,400,000 | | | | 1,277,731 | |
4.13%, 4/1/2029(a) | | | 240,000 | | | | 200,700 | |
| | |
Herbalife Nutrition Ltd. | | | | | | | | |
7.88%, 9/1/2025(a) | | | 3,017,000 | | | | 2,839,193 | |
| | |
Oriflame Investment Holding plc | | | | | | | | |
5.13%, 5/4/2026(a) | | | 2,895,000 | | | | 885,870 | |
| | |
Prestige Brands, Inc. | | | | | | | | |
5.13%, 1/15/2028(a) | | | 770,000 | | | | 709,917 | |
3.75%, 4/1/2031(a) | | | 2,235,000 | | | | 1,775,149 | |
| | | | | | | 12,037,680 | |
See Accompanying Notes to the Financial Statements.
| | | | |
438 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Pharmaceuticals – 1.9% | |
| | |
Bausch Health Americas, Inc. | | | | | | | | |
9.25%, 4/1/2026(a) | | $ | 1,369,000 | | | $ | 1,199,752 | |
8.50%, 1/31/2027(a) | | | 3,500,000 | | | | 1,566,250 | |
| | |
Bausch Health Cos., Inc. | | | | | | | | |
9.00%, 12/15/2025(a) | | | 1,798,000 | | | | 1,559,590 | |
6.13%, 2/1/2027(a) | | | 5,065,000 | | | | 2,825,459 | |
5.75%, 8/15/2027(a) | | | 1,265,000 | | | | 657,800 | |
7.00%, 1/15/2028(a) | | | 1,000,000 | | | | 410,045 | |
5.00%, 1/30/2028(a) | | | 1,835,000 | | | | 673,342 | |
4.88%, 6/1/2028(a) | | | 1,361,000 | | | | 678,853 | |
11.00%, 9/30/2028(a) | | | 3,860,000 | | | | 2,354,600 | |
5.00%, 2/15/2029(a) | | | 2,000,000 | | | | 701,080 | |
6.25%, 2/15/2029(a) | | | 3,000,000 | | | | 1,095,990 | |
7.25%, 5/30/2029(a) | | | 2,000,000 | | | | 750,000 | |
5.25%, 1/30/2030(a) | | | 3,000,000 | | | | 1,038,750 | |
14.00%, 10/15/2030(a) | | | 2,000,000 | | | | 1,077,115 | |
| | |
Cheplapharm Arzneimittel GmbH | | | | | | | | |
5.50%, 1/15/2028(a) | | | 640,000 | | | | 567,672 | |
| | |
HLF Financing Sarl LLC | | | | | | | | |
4.88%, 6/1/2029(a) | | | 3,255,000 | | | | 2,221,538 | |
| | |
Jazz Securities DAC | | | | | | | | |
4.38%, 1/15/2029(a) | | | 85,000 | | | | 73,922 | |
| | |
Organon & Co. | | | | | | | | |
4.13%, 4/30/2028(a) | | | 1,000,000 | | | | 863,760 | |
5.13%, 4/30/2031(a) | | | 1,707,000 | | | | 1,333,025 | |
| | |
P&L Development LLC | | | | | | | | |
7.75%, 11/15/2025(a) | | | 1,900,000 | | | | 1,276,230 | |
| | | | | | | 22,924,773 | |
|
Professional Services – 0.6% | |
| | |
AMN Healthcare, Inc. | | | | | | | | |
4.63%, 10/1/2027(a) | | | 1,220,000 | | | | 1,094,877 | |
4.00%, 4/15/2029(a) | | | 30,000 | | | | 24,845 | |
| | |
ASGN, Inc. | | | | | | | | |
4.63%, 5/15/2028(a) | | | 880,000 | | | | 779,227 | |
| | |
CoreLogic, Inc. | | | | | | | | |
4.50%, 5/1/2028(a) | | | 2,000,000 | | | | 1,585,000 | |
| | |
KBR, Inc. | | | | | | | | |
4.75%, 9/30/2028(a) | | | 1,170,000 | | | | 1,019,246 | |
| | |
Science Applications International Corp. | | | | | | | | |
4.88%, 4/1/2028(a) | | | 2,165,000 | | | | 1,931,768 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Professional Services – (continued) | |
| | |
TriNet Group, Inc. | | | | | | | | |
3.50%, 3/1/2029(a) | | $ | 1,006,000 | | | $ | 830,699 | |
| | | | | | | 7,265,662 | |
|
Real Estate Management & Development – 1.0% | |
| | |
Five Point Operating Co. LP | | | | | | | | |
7.88%, 11/15/2025(a) | | | 445,000 | | | | 417,941 | |
| | |
Forestar Group, Inc. | | | | | | | | |
3.85%, 5/15/2026(a) | | | 581,000 | | | | 517,135 | |
5.00%, 3/1/2028(a) | | | 1,715,000 | | | | 1,505,064 | |
| | |
Howard Hughes Corp. (The) | | | | | | | | |
5.38%, 8/1/2028(a) | | | 570,000 | | | | 501,093 | |
4.13%, 2/1/2029(a) | | | 150,000 | | | | 120,375 | |
4.38%, 2/1/2031(a) | | | 340,000 | | | | 258,806 | |
| | |
Hunt Cos., Inc. | | | | | | | | |
5.25%, 4/15/2029(a) | | | 2,035,000 | | | | 1,604,502 | |
| | |
Kennedy-Wilson, Inc. | | | | | | | | |
4.75%, 3/1/2029 | | | 3,040,000 | | | | 2,287,600 | |
4.75%, 2/1/2030 | | | 3,295,000 | | | | 2,405,350 | |
5.00%, 3/1/2031 | | | 3,385,000 | | | | 2,428,738 | |
| | |
Realogy Group LLC | | | | | | | | |
5.75%, 1/15/2029(a) | | | 840,000 | | | | 529,362 | |
| | |
WeWork Cos. LLC | | | | | | | | |
12.00%, 8/15/2027(a)(b) | | | 3,371,664 | | | | 66,309 | |
| | | | | | | 12,642,275 | |
|
Retail REITs – 0.5% | |
| | |
Brookfield Property REIT, Inc. | | | | | | | | |
REIT, 5.75%, 5/15/2026(a) | | | 2,820,000 | | | | 2,582,137 | |
REIT, 4.50%, 4/1/2027(a) | | | 4,110,000 | | | | 3,428,562 | |
| | | | | | | 6,010,699 | |
|
Software – 2.6% | |
| | |
Alteryx, Inc. | | | | | | | | |
8.75%, 3/15/2028(a) | | | 900,000 | | | | 888,747 | |
| | |
Camelot Finance SA | | | | | | | | |
4.50%, 11/1/2026(a) | | | 340,000 | | | | 314,292 | |
| | |
Cloud Software Group, Inc. | | | | | | | | |
6.50%, 3/31/2029(a) | | | 6,235,000 | | | | 5,474,004 | |
9.00%, 9/30/2029(a) | | | 2,750,000 | | | | 2,341,859 | |
| | |
Consensus Cloud Solutions, Inc. | | | | | | | | |
6.00%, 10/15/2026(a) | | | 895,000 | | | | 828,961 | |
6.50%, 10/15/2028(a) | | | 1,710,000 | | | | 1,417,162 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 439 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Software – (continued) | |
| | |
Crowdstrike Holdings, Inc. | | | | | | | | |
3.00%, 2/15/2029 | | $ | 500,000 | | | $ | 417,934 | |
| | |
CWT Travel Group, Inc. | | | | | | | | |
8.50%, 11/19/2026(a) | | | 7,371,000 | | | | 2,137,590 | |
| | |
Elastic NV | | | | | | | | |
4.13%, 7/15/2029(a) | | | 250,000 | | | | 210,691 | |
| | |
Gen Digital, Inc. | | | | | | | | |
7.13%, 9/30/2030(a) | | | 410,000 | | | | 398,869 | |
| | |
GoTo Group, Inc. | | | | | | | | |
5.50%, 9/1/2027(a) | | | 5,316,000 | | | | 2,772,137 | |
| | |
Helios Software Holdings, Inc. | | | | | | | | |
4.63%, 5/1/2028(a) | | | 480,000 | | | | 402,965 | |
| | |
McAfee Corp. | | | | | | | | |
7.38%, 2/15/2030(a) | | | 500,000 | | | | 399,988 | |
| | |
MicroStrategy, Inc. | | | | | | | | |
6.13%, 6/15/2028(a) | | | 480,000 | | | | 434,400 | |
| | |
Open Text Corp. | | | | | | | | |
3.88%, 12/1/2029(a) | | | 750,000 | | | | 613,335 | |
| | |
Open Text Holdings, Inc. | | | | | | | | |
4.13%, 2/15/2030(a) | | | 820,000 | | | | 679,451 | |
4.13%, 12/1/2031(a) | | | 350,000 | | | | 274,932 | |
| | |
PTC, Inc. | | | | | | | | |
3.63%, 2/15/2025(a) | | | 180,000 | | | | 173,514 | |
4.00%, 2/15/2028(a) | | | 2,700,000 | | | | 2,394,030 | |
| | |
SS&C Technologies, Inc. | | | | | | | | |
5.50%, 9/30/2027(a) | | | 1,935,000 | | | | 1,815,557 | |
| | |
Veritas US, Inc. | | | | | | | | |
7.50%, 9/1/2025(a) | | | 9,110,000 | | | | 7,457,652 | |
| | | | | | | 31,848,070 | |
|
Specialized REITs – 0.4% | |
| | |
Iron Mountain, Inc. | | | | | | | | |
REIT, 5.25%, 3/15/2028(a) | | | 500,000 | | | | 457,321 | |
REIT, 5.00%, 7/15/2028(a) | | | 500,000 | | | | 447,439 | |
REIT, 7.00%, 2/15/2029(a) | | | 1,000,000 | | | | 968,751 | |
REIT, 4.88%, 9/15/2029(a) | | | 1,000,000 | | | | 871,061 | |
REIT, 5.25%, 7/15/2030(a) | | | 955,000 | | | | 829,010 | |
REIT, 4.50%, 2/15/2031(a) | | | 800,000 | | | | 654,387 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Specialized REITs – (continued) | |
REIT, 5.63%, 7/15/2032(a) | | $ | 474,000 | | | $ | 404,926 | |
| | |
SBA Communications Corp. | | | | | | | | |
REIT, 3.88%, 2/15/2027 | | | 200,000 | | | | 182,139 | |
| | | | | | | 4,815,034 | |
|
Specialty Retail – 3.3% | |
| | |
99 Escrow Issuer, Inc. | | | | | | | | |
7.50%, 1/15/2026(a) | | | 630,000 | | | | 220,500 | |
| | |
Arko Corp. | | | | | | | | |
5.13%, 11/15/2029(a) | | | 2,285,000 | | | | 1,852,678 | |
| | |
Asbury Automotive Group, Inc. | | | | | | | | |
5.00%, 2/15/2032(a) | | | 500,000 | | | | 405,530 | |
| | |
At Home Group, Inc. | | | | | | | | |
4.88%, 7/15/2028(a) | | | 1,760,000 | | | | 598,400 | |
| | |
Bath & Body Works, Inc. | | | | | | | | |
6.95%, 3/1/2033 | | | 230,000 | | | | 198,891 | |
6.75%, 7/1/2036 | | | 400,000 | | | | 345,029 | |
| | |
BCPE Ulysses Intermediate, Inc. | | | | | | | | |
7.75%, 4/1/2027(a)(b) | | | 1,100,000 | | | | 933,020 | |
| | |
eG Global Finance plc | | | | | | | | |
8.50%, 10/30/2025(a) | | | 1,200,000 | | | | 1,180,500 | |
| | |
Evergreen Acqco 1 LP | | | | | | | | |
9.75%, 4/26/2028(a) | | | 1,350,000 | | | | 1,362,353 | |
| | |
Foot Locker, Inc. | | | | | | | | |
4.00%, 10/1/2029(a) | | | 300,000 | | | | 220,509 | |
| | |
Gap, Inc. (The) | | | | | | | | |
3.63%, 10/1/2029(a) | | | 2,290,000 | | | | 1,749,620 | |
3.88%, 10/1/2031(a) | | | 1,433,000 | | | | 1,029,092 | |
| | |
GYP Holdings III Corp. | | | | | | | | |
4.63%, 5/1/2029(a) | | | 510,000 | | | | 418,200 | |
| | |
Ken Garff Automotive LLC | | | | | | | | |
4.88%, 9/15/2028(a) | | | 125,000 | | | | 105,713 | |
| | |
LCM Investments Holdings II LLC | | | | | | | | |
4.88%, 5/1/2029(a) | | | 911,000 | | | | 763,398 | |
| | |
LSF9 Atlantis Holdings LLC | | | | | | | | |
7.75%, 2/15/2026(a) | | | 1,075,000 | | | | 970,271 | |
| | |
Michaels Cos., Inc. (The) | | | | | | | | |
5.25%, 5/1/2028(a) | | | 4,595,000 | | | | 3,329,353 | |
7.88%, 5/1/2029(a) | | | 6,470,000 | | | | 3,607,025 | |
See Accompanying Notes to the Financial Statements.
| | | | |
440 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Specialty Retail – (continued) | |
| | |
Murphy Oil USA, Inc. | | | | | | | | |
5.63%, 5/1/2027 | | $ | 45,000 | | | $ | 43,496 | |
4.75%, 9/15/2029 | | | 200,000 | | | | 177,074 | |
3.75%, 2/15/2031(a) | | | 2,750,000 | | | | 2,209,272 | |
| | |
PetSmart, Inc. | | | | | | | | |
4.75%, 2/15/2028(a) | | | 750,000 | | | | 663,659 | |
7.75%, 2/15/2029(a) | | | 860,000 | | | | 791,752 | |
| | |
Sonic Automotive, Inc. | | | | | | | | |
4.63%, 11/15/2029(a) | | | 255,000 | | | | 212,276 | |
4.88%, 11/15/2031(a) | | | 1,620,000 | | | | 1,290,050 | |
| | |
Specialty Building Products Holdings LLC | | | | | | | | |
6.38%, 9/30/2026(a) | | | 1,265,000 | | | | 1,176,869 | |
| | |
Staples, Inc. | | | | | | | | |
7.50%, 4/15/2026(a) | | | 10,665,000 | | | | 8,699,371 | |
10.75%, 4/15/2027(a) | | | 5,058,000 | | | | 2,786,194 | |
| | |
Upbound Group, Inc. | | | | | | | | |
6.38%, 2/15/2029(a) | | | 1,150,000 | | | | 989,000 | |
| | |
Valvoline, Inc. | | | | | | | | |
3.63%, 6/15/2031(a) | | | 2,780,000 | | | | 2,112,800 | |
| | |
Victoria's Secret & Co. | | | | | | | | |
4.63%, 7/15/2029(a) | | | 275,000 | | | | 202,165 | |
| | | | | | | 40,644,060 | |
|
Technology Hardware, Storage & Peripherals – 0.4% | |
| | |
NCR Atleos Escrow Corp. | | | | | | | | |
9.50%, 4/1/2029(a) | | | 1,000,000 | | | | 980,230 | |
| | |
Seagate HDD Cayman | | | | | | | | |
9.63%, 12/1/2032(a) | | | 310,000 | | | | 330,465 | |
5.75%, 12/1/2034 | | | 325,000 | | | | 275,063 | |
| | |
Xerox Corp. | | | | | | | | |
4.80%, 3/1/2035 | | | 1,085,000 | | | | 658,201 | |
6.75%, 12/15/2039 | | | 1,905,000 | | | | 1,240,075 | |
| | |
Xerox Holdings Corp. | | | | | | | | |
5.50%, 8/15/2028(a) | | | 1,715,000 | | | | 1,324,570 | |
| | | | | | | 4,808,604 | |
|
Textiles, Apparel & Luxury Goods – 0.1% | |
| | |
Eagle Intermediate Global Holding BV | | | | | | | | |
7.50%, 5/1/2025(a) | | | 816,000 | | | | 542,640 | |
| | |
William Carter Co. (The) | | | | | | | | |
5.63%, 3/15/2027(a) | | | 250,000 | | | | 236,880 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Textiles, Apparel & Luxury Goods – (continued) | |
| | |
Wolverine World Wide, Inc. | | | | | | | | |
4.00%, 8/15/2029(a) | | $ | 500,000 | | | $ | 372,799 | |
| | | | | | | 1,152,319 | |
|
Tobacco – 0.4% | |
| | |
Turning Point Brands, Inc. | | | | | | | | |
5.63%, 2/15/2026(a) | | | 270,000 | | | | 247,725 | |
| | |
Vector Group Ltd. | | | | | | | | |
10.50%, 11/1/2026(a) | | | 1,124,000 | | | | 1,124,832 | |
5.75%, 2/1/2029(a) | | | 4,675,000 | | | | 3,961,675 | |
| | | | | | | 5,334,232 | |
|
Trading Companies & Distributors – 0.4% | |
| | |
Alta Equipment Group, Inc. | | | | | | | | |
5.63%, 4/15/2026(a) | | | 1,670,000 | | | | 1,493,922 | |
| | |
Beacon Roofing Supply, Inc. | | | | | | | | |
4.50%, 11/15/2026(a) | | | 825,000 | | | | 768,801 | |
4.13%, 5/15/2029(a) | | | 895,000 | | | | 751,348 | |
| | |
BlueLinx Holdings, Inc. | | | | | | | | |
6.00%, 11/15/2029(a) | | | 530,000 | | | | 446,029 | |
| | |
Boise Cascade Co. | | | | | | | | |
4.88%, 7/1/2030(a) | | | 220,000 | | | | 189,251 | |
| | |
Imola Merger Corp. | | | | | | | | |
4.75%, 5/15/2029(a) | | | 1,970,000 | | | | 1,717,432 | |
| | | | | | | 5,366,783 | |
|
Transportation Infrastructure – 0.1% | |
| | |
Port of Newcastle Investments Financing Pty. Ltd. | | | | | | | | |
5.90%, 11/24/2031(a) | | | 1,500,000 | | | | 1,254,367 | |
|
Wireless Telecommunication Services – 0.9% | |
| | |
C&W Senior Financing DAC | | | | | | | | |
6.88%, 9/15/2027(a) | | | 1,190,000 | | | | 1,023,162 | |
| | |
Connect Finco Sarl | | | | | | | | |
6.75%, 10/1/2026(a) | | | 2,150,000 | | | | 2,004,952 | |
| | |
Hughes Satellite Systems Corp. | | | | | | | | |
5.25%, 8/1/2026 | | | 1,270,000 | | | | 1,142,073 | |
6.63%, 8/1/2026 | | | 2,340,000 | | | | 1,983,098 | |
| | |
Rogers Communications, Inc. | | | | | | | | |
5.25%, 3/15/2082(a)(c) | | | 1,765,000 | | | | 1,552,714 | |
| | |
Vmed O2 UK Financing I plc | | | | | | | | |
4.25%, 1/31/2031(a) | | | 915,000 | | | | 719,764 | |
4.75%, 7/15/2031(a) | | | 1,260,000 | | | | 1,014,181 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 441 | |
FlexShares® High Yield Value-Scored Bond Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Wireless Telecommunication Services – (continued) | |
| | |
Vodafone Group plc | | | | | | | | |
7.00%, 4/4/2079(c) | | $ | 1,000,000 | | | $ | 966,922 | |
| | | | | | | 10,406,866 | |
Total Corporate Bonds (Cost $1,262,089,529) | | | | 1,199,469,056 | |
Total Investments – 98.1% (Cost $1,262,089,529) | | | | 1,199,469,056 | |
| |
Other assets less liabilities – 1.9% | | | | 22,837,465 | |
NET ASSETS – 100.0% | | | $ | 1,222,306,521 | |
(a) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(b) | Payment in-kind security. |
(c) | Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end. |
(d) | Represents less than 0.05% of net assets. |
(e) | Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2023. |
Percentages shown are based on Net Assets.
Abbreviations
REIT Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 2,024,001 | |
Aggregate gross unrealized depreciation | | | (92,705,555 | ) |
Net unrealized depreciation | | $ | (90,681,554 | ) |
Federal income tax cost | | $ | 1,290,150,610 | |
| | | | |
Security Type | | % of Net Assets | |
Corporate Bonds | | | 98.1 | % |
Others(1) | | | 1.9 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
442 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 96.7% | |
|
Air Freight & Logistics – 0.7% | |
| | |
United Parcel Service, Inc. | | | | | | | | |
4.45%, 4/1/2030 | | $ | 147,000 | | | $ | 137,889 | |
3.75%, 11/15/2047 | | | 20,000 | | | | 14,194 | |
5.05%, 3/3/2053 | | | 20,000 | | | | 17,170 | |
| | | | | | | 169,253 | |
|
Automobile Components – 0.1% | |
| | |
Aptiv plc | | | | | | | | |
3.10%, 12/1/2051 | | | 26,000 | | | | 14,005 | |
|
Automobiles – 0.6% | |
| | |
General Motors Co. | | | | | | | | |
6.80%, 10/1/2027 | | | 100,000 | | | | 101,560 | |
5.15%, 4/1/2038 | | | 40,000 | | | | 32,174 | |
5.95%, 4/1/2049 | | | 30,000 | | | | 24,256 | |
| | | | | | | 157,990 | |
|
Banks – 15.1% | |
| | |
Banco Santander SA | | | | | | | | |
5.15%, 8/18/2025 | | | 200,000 | | | | 194,826 | |
4.18%, 3/24/2028(a) | | | 200,000 | | | | 183,135 | |
| | |
Bank of America Corp. | | | | | | | | |
3.38%, 4/2/2026(a) | | | 201,000 | | | | 192,588 | |
5.08%, 1/20/2027(a) | | | 67,000 | | | | 65,222 | |
1.73%, 7/22/2027(a) | | | 100,000 | | | | 88,251 | |
3.42%, 12/20/2028(a) | | | 133,000 | | | | 118,387 | |
2.09%, 6/14/2029(a) | | | 127,000 | | | | 104,857 | |
4.27%, 7/23/2029(a) | | | 100,000 | | | | 91,002 | |
4.57%, 4/27/2033(a) | | | 67,000 | | | | 57,781 | |
5.29%, 4/25/2034(a) | | | 135,000 | | | | 121,931 | |
2.68%, 6/19/2041(a) | | | 44,000 | | | | 26,827 | |
| | |
Barclays plc | | | | | | | | |
5.83%, 5/9/2027(a) | | | 193,000 | | | | 188,590 | |
3.81%, 3/10/2042(a) | | | 200,000 | | | | 126,002 | |
| | |
Citigroup, Inc. | | | | | | | | |
3.29%, 3/17/2026(a) | | | 33,000 | | | | 31,602 | |
3.11%, 4/8/2026(a) | | | 100,000 | | | | 95,438 | |
3.20%, 10/21/2026 | | | 67,000 | | | | 61,765 | |
4.45%, 9/29/2027 | | | 67,000 | | | | 61,891 | |
3.98%, 3/20/2030(a) | | | 67,000 | | | | 59,276 | |
2.67%, 1/29/2031(a) | | | 107,000 | | | | 85,252 | |
4.41%, 3/31/2031(a) | | | 100,000 | | | | 88,470 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Banks – (continued) | |
2.57%, 6/3/2031(a) | | $ | 73,000 | | | $ | 57,163 | |
3.06%, 1/25/2033(a) | | | 77,000 | | | | 59,283 | |
8.13%, 7/15/2039 | | | 30,000 | | | | 33,826 | |
6.68%, 9/13/2043 | | | 17,000 | | | | 16,253 | |
| | |
HSBC Holdings plc | | | | | | | | |
7.39%, 11/3/2028(a) | | | 210,000 | | | | 215,418 | |
6.50%, 9/15/2037 | | | 150,000 | | | | 138,183 | |
| | |
ING Groep NV | | | | | | | | |
4.02%, 3/28/2028(a) | | | 200,000 | | | | 184,009 | |
| | |
JPMorgan Chase & Co. | | | | | | | | |
1.58%, 4/22/2027(a) | | | 100,000 | | | | 89,213 | |
3.78%, 2/1/2028(a) | | | 100,000 | | | | 92,780 | |
4.45%, 12/5/2029(a) | | | 100,000 | | | | 91,980 | |
4.57%, 6/14/2030(a) | | | 100,000 | | | | 91,777 | |
2.74%, 10/15/2030(a) | | | 40,000 | | | | 32,863 | |
2.58%, 4/22/2032(a) | | | 14,000 | | | | 10,813 | |
4.91%, 7/25/2033(a) | | | 33,000 | | | | 29,641 | |
5.60%, 7/15/2041 | | | 50,000 | | | | 45,999 | |
5.63%, 8/16/2043 | | | 17,000 | | | | 15,363 | |
4.95%, 6/1/2045 | | | 33,000 | | | | 27,021 | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | | | | | | |
5.13%, 7/20/2033(a) | | | 200,000 | | | | 182,760 | |
| | |
PNC Financial Services Group, Inc. (The) | | | | | | | | |
4.63%, 6/6/2033(a) | | | 50,000 | | | | 41,715 | |
| | |
Royal Bank of Canada | | | | | | | | |
5.00%, 2/1/2033 | | | 10,000 | | | | 9,041 | |
| | |
Santander Holdings USA, Inc. | | | | | | | | |
3.45%, 6/2/2025 | | | 120,000 | | | | 113,531 | |
| | |
Toronto-Dominion Bank (The) | | | | | | | | |
4.11%, 6/8/2027 | | | 17,000 | | | | 15,938 | |
4.46%, 6/8/2032 | | | 77,000 | | | | 67,144 | |
| | |
Westpac Banking Corp. | | | | | | | | |
4.42%, 7/24/2039 | | | 40,000 | | | | 29,237 | |
| | | | | | | 3,734,044 | |
|
Beverages – 2.3% | |
| | |
Anheuser-Busch Cos. LLC | | | | | | | | |
4.70%, 2/1/2036 | | | 71,000 | | | | 62,483 | |
| | |
Anheuser-Busch InBev Worldwide, Inc. | | | | | | | | |
5.45%, 1/23/2039 | | | 12,000 | | | | 11,071 | |
5.80%, 1/23/2059 | | | 12,000 | | | | 11,082 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 443 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Beverages – (continued) | |
| | |
Coca-Cola Co. (The) | | | | | | | | |
2.25%, 1/5/2032 | | $ | 250,000 | | | $ | 197,711 | |
| | |
Molson Coors Beverage Co. | | | | | | | | |
4.20%, 7/15/2046 | | | 14,000 | | | | 9,928 | |
| | |
PepsiCo, Inc. | | | | | | | | |
2.25%, 3/19/2025 | | | 10,000 | | | | 9,580 | |
4.45%, 5/15/2028 | | | 67,000 | | | | 65,300 | |
2.63%, 7/29/2029 | | | 50,000 | | | | 43,275 | |
1.95%, 10/21/2031 | | | 80,000 | | | | 61,440 | |
3.50%, 3/19/2040 | | | 133,000 | | | | 99,100 | |
| | | | | | | 570,970 | |
|
Biotechnology – 1.4% | |
| | |
Amgen, Inc. | | | | | | | | |
1.90%, 2/21/2025 | | | 17,000 | | | | 16,212 | |
4.05%, 8/18/2029 | | | 26,000 | | | | 23,781 | |
2.80%, 8/15/2041 | | | 26,000 | | | | 16,083 | |
5.60%, 3/2/2043 | | | 120,000 | | | | 107,030 | |
4.66%, 6/15/2051 | | | 114,000 | | | | 86,757 | |
4.88%, 3/1/2053 | | | 26,000 | | | | 20,299 | |
2.77%, 9/1/2053 | | | 14,000 | | | | 7,314 | |
| | |
Biogen, Inc. | | | | | | | | |
3.15%, 5/1/2050 | | | 33,000 | | | | 19,004 | |
| | |
Regeneron Pharmaceuticals, Inc. | | | | | | | | |
1.75%, 9/15/2030 | | | 54,000 | | | | 40,696 | |
| | | | | | | 337,176 | |
|
Broadline Retail – 0.9% | |
| | |
Alibaba Group Holding Ltd. | | | | | | | | |
2.70%, 2/9/2041 | | | 200,000 | | | | 115,735 | |
| | |
eBay, Inc. | | | | | | | | |
5.90%, 11/22/2025 | | | 67,000 | | | | 67,059 | |
2.70%, 3/11/2030 | | | 50,000 | | | | 40,603 | |
| | | | | | | 223,397 | |
|
Building Products – 0.4% | |
| | |
Johnson Controls International plc | | | | | | | | |
4.63%, 7/2/2044(b) | | | 33,000 | | | | 25,460 | |
| | |
Owens Corning | | | | | | | | |
4.30%, 7/15/2047 | | | 26,000 | | | | 18,529 | |
| | |
Trane Technologies Financing Ltd. | | | | | | | | |
3.80%, 3/21/2029 | | | 50,000 | | | | 45,632 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Building Products – (continued) | |
| | |
Trane Technologies Global Holding Co. Ltd. | | | | | | | | |
4.30%, 2/21/2048 | | $ | 7,000 | | | $ | 5,106 | |
| | | | | | | 94,727 | |
|
Capital Markets – 7.0% | |
| | |
Bain Capital Specialty Finance, Inc. | | | | | | | | |
2.55%, 10/13/2026 | | | 7,000 | | | | 6,015 | |
| | |
Bank of New York Mellon Corp. (The) | | | | | | | | |
3.40%, 1/29/2028 | | | 67,000 | | | | 60,876 | |
3.99%, 6/13/2028(a) | | | 47,000 | | | | 43,793 | |
4.60%, 7/26/2030(a) | | | 33,000 | | | | 30,425 | |
4.29%, 6/13/2033(a) | | | 20,000 | | | | 17,213 | |
| | |
Barings BDC, Inc. | | | | | | | | |
3.30%, 11/23/2026 | | | 7,000 | | | | 6,125 | |
| | |
BlackRock, Inc. | | | | | | | | |
4.75%, 5/25/2033 | | | 10,000 | | | | 9,157 | |
| | |
Blackstone Private Credit Fund | | | | | | | | |
2.63%, 12/15/2026 | | | 33,000 | | | | 28,252 | |
| | |
Blue Owl Capital Corp. | | | | | | | | |
2.63%, 1/15/2027 | | | 33,000 | | | | 28,207 | |
| | |
Blue Owl Credit Income Corp. | | | | | | | | |
5.50%, 3/21/2025 | | | 33,000 | | | | 31,929 | |
| | |
Eaton Vance Corp. | | | | | | | | |
3.50%, 4/6/2027 | | | 3,000 | | | | 2,772 | |
| | |
FactSet Research Systems, Inc. | | | | | | | | |
3.45%, 3/1/2032 | | | 10,000 | | | | 8,088 | |
| | |
Franklin BSP Lending Corp. | | | | | | | | |
3.25%, 3/30/2026 | | | 7,000 | | | | 6,263 | |
| | |
Goldman Sachs Group, Inc. (The) | | | | | | | | |
4.48%, 8/23/2028(a) | | | 301,000 | | | | 281,812 | |
2.38%, 7/21/2032(a) | | | 17,000 | | | | 12,618 | |
3.10%, 2/24/2033(a) | | | 70,000 | | | | 54,418 | |
6.75%, 10/1/2037 | | | 87,000 | | | | 84,987 | |
| | |
Hercules Capital, Inc. | | | | | | | | |
3.38%, 1/20/2027 | | | 14,000 | | | | 12,196 | |
| | |
Moody’s Corp. | | | | | | | | |
2.75%, 8/19/2041 | | | 33,000 | | | | 20,363 | |
3.75%, 2/25/2052 | | | 7,000 | | | | 4,667 | |
| | |
Morgan Stanley | | | | | | | | |
2.63%, 2/18/2026(a) | | | 20,000 | | | | 19,042 | |
3.13%, 7/27/2026 | | | 100,000 | | | | 92,515 | |
0.99%, 12/10/2026(a) | | | 26,000 | | | | 23,139 | |
See Accompanying Notes to the Financial Statements.
| | | | |
444 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Capital Markets – (continued) | |
5.12%, 2/1/2029(a) | | $ | 133,000 | | | $ | 126,628 | |
2.70%, 1/22/2031(a) | | | 133,000 | | | | 106,862 | |
2.24%, 7/21/2032(a) | | | 30,000 | | | | 22,126 | |
5.25%, 4/21/2034(a) | | | 135,000 | | | | 121,636 | |
5.42%, 7/21/2034(a) | | | 14,000 | | | | 12,778 | |
5.30%, 4/20/2037(a) | | | 33,000 | | | | 28,620 | |
5.60%, 3/24/2051(a) | | | 63,000 | | | | 56,256 | |
| | |
Nasdaq, Inc. | | | | | | | | |
3.85%, 6/30/2026 | | | 50,000 | | | | 47,712 | |
5.55%, 2/15/2034 | | | 40,000 | | | | 37,104 | |
3.95%, 3/7/2052 | | | 7,000 | | | | 4,625 | |
| | |
Prospect Capital Corp. | | | | | | | | |
3.71%, 1/22/2026 | | | 33,000 | | | | 29,618 | |
| | |
S&P Global, Inc. | | | | | | | | |
1.25%, 8/15/2030 | | | 50,000 | | | | 37,177 | |
2.90%, 3/1/2032 | | | 50,000 | | | | 40,118 | |
4.50%, 5/15/2048 | | | 14,000 | | | | 10,608 | |
| | |
State Street Corp. | | | | | | | | |
2.90%, 3/30/2026(a) | | | 50,000 | | | | 47,651 | |
5.82%, 11/4/2028(a) | | | 50,000 | | | | 49,422 | |
2.40%, 1/24/2030 | | | 63,000 | | | | 51,310 | |
| | | | | | | 1,715,123 | |
|
Chemicals – 0.9% | |
| | |
Air Products and Chemicals, Inc. | | | | | | | | |
2.05%, 5/15/2030 | | | 40,000 | | | | 32,185 | |
| | |
Dow Chemical Co. (The) | | | | | | | | |
6.90%, 5/15/2053 | | | 54,000 | | | | 53,980 | |
| | |
DuPont de Nemours, Inc. | | | | | | | | |
5.32%, 11/15/2038 | | | 7,000 | | | | 6,256 | |
5.42%, 11/15/2048 | | | 14,000 | | | | 12,143 | |
| | |
Ecolab, Inc. | | | | | | | | |
4.80%, 3/24/2030 | | | 33,000 | | | | 31,267 | |
1.30%, 1/30/2031 | | | 63,000 | | | | 46,360 | |
| | |
International Flavors & Fragrances, Inc. | | | | | | | | |
5.00%, 9/26/2048 | | | 17,000 | | | | 12,231 | |
| | |
Nutrien Ltd. | | | | | | | | |
5.25%, 1/15/2045 | | | 47,000 | | | | 38,477 | |
| | | | | | | 232,899 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Commercial Services & Supplies – 0.4% | |
| | |
RELX Capital, Inc. | | | | | | | | |
3.00%, 5/22/2030 | | $ | 33,000 | | | $ | 27,612 | |
| | |
Waste Management, Inc. | | | | | | | | |
4.63%, 2/15/2030 | | | 47,000 | | | | 44,170 | |
2.95%, 6/1/2041 | | | 33,000 | | | | 21,570 | |
| | | | | | | 93,352 | |
|
Communications Equipment – 0.1% | |
| | |
Nokia OYJ | | | | | | | | |
4.38%, 6/12/2027 | | | 26,000 | | | | 24,055 | |
|
Consumer Finance – 2.0% | |
| | |
American Express Co. | | | | | | | | |
3.13%, 5/20/2026 | | | 50,000 | | | | 46,915 | |
3.30%, 5/3/2027 | | | 50,000 | | | | 45,761 | |
4.42%, 8/3/2033(a) | | | 40,000 | | | | 34,920 | |
4.05%, 12/3/2042 | | | 14,000 | | | | 10,554 | |
| | |
Capital One Financial Corp. | | | | | | | | |
4.93%, 5/10/2028(a) | | | 23,000 | | | | 21,277 | |
3.27%, 3/1/2030(a) | | | 30,000 | | | | 24,600 | |
5.27%, 5/10/2033(a) | | | 57,000 | | | | 48,753 | |
| | |
General Motors Financial Co., Inc. | | | | | | | | |
6.00%, 1/9/2028 | | | 33,000 | | | | 32,408 | |
5.85%, 4/6/2030 | | | 33,000 | | | | 31,189 | |
3.10%, 1/12/2032 | | | 67,000 | | | | 50,949 | |
| | |
John Deere Capital Corp. | | | | | | | | |
4.80%, 1/9/2026 | | | 20,000 | | | | 19,736 | |
4.35%, 9/15/2032 | | | 67,000 | | | | 60,511 | |
Series I, 5.15%, 9/8/2033 | | | 40,000 | | | | 38,040 | |
| | |
Synchrony Financial | | | | | | | | |
2.88%, 10/28/2031 | | | 44,000 | | | | 29,817 | |
| | | | | | | 495,430 | |
|
Consumer Staples Distribution & Retail – 1.0% | |
| | |
Kroger Co. (The) | | | | | | | | |
5.40%, 1/15/2049 | | | 8,000 | | | | 6,856 | |
3.95%, 1/15/2050 | | | 54,000 | | | | 36,568 | |
| | |
Target Corp. | | | | | | | | |
2.25%, 4/15/2025 | | | 50,000 | | | | 47,738 | |
2.65%, 9/15/2030 | | | 127,000 | | | | 104,374 | |
| | |
Walgreens Boots Alliance, Inc. | | | | | | | | |
3.45%, 6/1/2026 | | | 50,000 | | | | 45,570 | |
4.10%, 4/15/2050 | | | 17,000 | | | | 9,895 | |
| | | | | | | 251,001 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 445 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Containers & Packaging – 0.3% | |
| | |
Amcor Finance USA, Inc. | | | | | | | | |
3.63%, 4/28/2026 | | $ | 20,000 | | | $ | 18,842 | |
5.63%, 5/26/2033 | | | 20,000 | | | | 18,627 | |
| | |
AptarGroup, Inc. | | | | | | | | |
3.60%, 3/15/2032 | | | 3,000 | | | | 2,445 | |
| | |
Avery Dennison Corp. | | | | | | | | |
5.75%, 3/15/2033 | | | 14,000 | | | | 13,353 | |
| | |
Berry Global, Inc. | | | | | | | | |
1.57%, 1/15/2026 | | | 26,000 | | | | 23,490 | |
| | | | | | | 76,757 | |
|
Diversified Consumer Services – 0.0%(c) | |
| | |
Howard University | | | | | | | | |
Series 22A, 5.21%, 10/1/2052 | | | 3,000 | | | | 2,336 | |
|
Diversified REITs – 0.5% | |
| | |
Digital Realty Trust LP | | | | | | | | |
REIT, 4.45%, 7/15/2028 | | | 33,000 | | | | 30,512 | |
| | |
Simon Property Group LP | | | | | | | | |
REIT, 1.75%, 2/1/2028 | | | 20,000 | | | | 16,789 | |
REIT, 2.65%, 2/1/2032 | | | 50,000 | | | | 38,030 | |
REIT, 6.75%, 2/1/2040 | | | 17,000 | | | | 16,698 | |
REIT, 5.85%, 3/8/2053 | | | 17,000 | | | | 14,789 | |
| | |
Vornado Realty LP | | | | | | | | |
REIT, 2.15%, 6/1/2026 | | | 14,000 | | | | 11,795 | |
| | | | | | | 128,613 | |
|
Diversified Telecommunication Services – 3.5% | |
| | |
AT&T, Inc. | | | | | | | | |
5.40%, 2/15/2034 | | | 33,000 | | | | 30,321 | |
4.65%, 6/1/2044 | | | 54,000 | | | | 40,810 | |
| | |
Deutsche Telekom International Finance BV | | | | | | | | |
8.75%, 6/15/2030(b) | | | 40,000 | | | | 44,817 | |
| | |
Orange SA | | | | | | | | |
9.00%, 3/1/2031(b) | | | 44,000 | | | | 50,406 | |
| | |
Telefonica Emisiones SA | | | | | | | | |
4.90%, 3/6/2048 | | | 150,000 | | | | 108,076 | |
| | |
TELUS Corp. | | | | | | | | |
3.40%, 5/13/2032 | | | 7,000 | | | | 5,543 | |
| | |
Verizon Communications, Inc. | | | | | | | | |
4.13%, 3/16/2027 | | | 100,000 | | | | 94,724 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified Telecommunication Services – (continued) | |
4.33%, 9/21/2028 | | $ | 100,000 | | | $ | 93,108 | |
2.55%, 3/21/2031 | | | 67,000 | | | | 52,345 | |
2.36%, 3/15/2032 | | | 67,000 | | | | 50,099 | |
2.65%, 11/20/2040 | | | 161,000 | | | | 97,321 | |
3.40%, 3/22/2041 | | | 84,000 | | | | 56,684 | |
4.86%, 8/21/2046 | | | 50,000 | | | | 39,796 | |
3.88%, 3/1/2052 | | | 154,000 | | | | 102,723 | |
2.99%, 10/30/2056 | | | 14,000 | | | | 7,366 | |
| | | | | | | 874,139 | |
|
Electric Utilities – 3.6% | |
| | |
Avangrid, Inc. | | | | | | | | |
3.80%, 6/1/2029 | | | 14,000 | | | | 12,305 | |
| | |
Commonwealth Edison Co. | | | | | | | | |
3.00%, 3/1/2050 | | | 33,000 | | | | 19,057 | |
| | |
Connecticut Light and Power Co. (The) | | | | | | | | |
Series A, 2.05%, 7/1/2031 | | | 117,000 | | | | 89,213 | |
4.00%, 4/1/2048 | | | 7,000 | | | | 4,998 | |
| | |
Edison International | | | | | | | | |
4.13%, 3/15/2028 | | | 150,000 | | | | 136,445 | |
| | |
Enel Americas SA | | | | | | | | |
4.00%, 10/25/2026 | | | 7,000 | | | | 6,535 | |
| | |
Enel Chile SA | | | | | | | | |
4.88%, 6/12/2028 | | | 10,000 | | | | 9,328 | |
| | |
Eversource Energy | | | | | | | | |
4.60%, 7/1/2027 | | | 17,000 | | | | 16,190 | |
Series R, 1.65%, 8/15/2030 | | | 17,000 | | | | 12,726 | |
3.45%, 1/15/2050 | | | 30,000 | | | | 18,264 | |
| | |
Exelon Corp. | | | | | | | | |
2.75%, 3/15/2027 | | | 167,000 | | | | 151,083 | |
5.30%, 3/15/2033 | | | 10,000 | | | | 9,277 | |
4.95%, 6/15/2035 | | | 50,000 | | | | 43,324 | |
4.45%, 4/15/2046 | | | 33,000 | | | | 24,220 | |
5.60%, 3/15/2053 | | | 23,000 | | | | 19,731 | |
| | |
Pacific Gas and Electric Co. | | | | | | | | |
3.95%, 12/1/2047 | | | 200,000 | | | | 119,331 | |
| | |
PECO Energy Co. | | | | | | | | |
4.90%, 6/15/2033 | | | 20,000 | | | | 18,505 | |
| | |
Public Service Electric and Gas Co. | | | | | | | | |
3.60%, 12/1/2047 | | | 57,000 | | | | 38,573 | |
See Accompanying Notes to the Financial Statements.
| | | | |
446 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Electric Utilities – (continued) | |
| | |
Southern California Edison Co. | | | | | | | | |
5.95%, 11/1/2032 | | $ | 67,000 | | | $ | 65,432 | |
Series C, 4.13%, 3/1/2048 | | | 33,000 | | | | 22,889 | |
Series E, 5.45%, 6/1/2052 | | | 20,000 | | | | 16,699 | |
| | |
Union Electric Co. | | | | | | | | |
3.50%, 3/15/2029 | | | 20,000 | | | | 17,864 | |
4.00%, 4/1/2048 | | | 40,000 | | | | 27,655 | |
| | | | | | | 899,644 | |
|
Electrical Equipment – 0.1% | |
| | |
ABB Finance USA, Inc. | | | | | | | | |
3.80%, 4/3/2028 | | | 33,000 | | | | 31,081 | |
|
Electronic Equipment, Instruments & Components – 0.1% | |
| | |
Jabil, Inc. | | | | | | | | |
3.00%, 1/15/2031 | | | 20,000 | | | | 15,844 | |
|
Energy Equipment & Services – 0.4% | |
| | |
Baker Hughes Holdings LLC | | | | | | | | |
4.08%, 12/15/2047 | | | 30,000 | | | | 21,392 | |
| | |
Halliburton Co. | | | | | | | | |
2.92%, 3/1/2030 | | | 10,000 | | | | 8,391 | |
4.85%, 11/15/2035 | | | 50,000 | | | | 43,993 | |
| | |
Schlumberger Investment SA | | | | | | | | |
4.85%, 5/15/2033 | | | 20,000 | | | | 18,406 | |
| | | | | | | 92,182 | |
|
Entertainment – 0.7% | |
| | |
Walt Disney Co. (The) | | | | | | | | |
6.40%, 12/15/2035 | | | 67,000 | | | | 68,218 | |
7.75%, 12/1/2045 | | | 14,000 | | | | 16,160 | |
4.75%, 11/15/2046 | | | 67,000 | | | | 54,092 | |
3.80%, 5/13/2060 | | | 50,000 | | | | 32,604 | |
| | | | | | | 171,074 | |
|
Financial Services – 3.2% | |
| | |
Corebridge Financial, Inc. | | | | | | | | |
6.88%, 12/15/2052(a) | | | 7,000 | | | | 6,467 | |
| | |
Equitable Holdings, Inc. | | | | | | | | |
5.59%, 1/11/2033 | | | 34,000 | | | | 31,307 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Financial Services – (continued) | |
| | |
Fidelity National Information Services, Inc. | | | | | | | | |
4.50%, 7/15/2025 | | $ | 167,000 | | | $ | 163,086 | |
| | |
Mastercard, Inc. | | | | | | | | |
3.30%, 3/26/2027 | | | 100,000 | | | | 93,380 | |
2.95%, 6/1/2029 | | | 94,000 | | | | 82,465 | |
2.00%, 11/18/2031 | | | 33,000 | | | | 25,180 | |
| | |
PayPal Holdings, Inc. | | | | | | | | |
4.40%, 6/1/2032 | | | 73,000 | | | | 65,419 | |
| | |
Shell International Finance BV | | | | | | | | |
3.88%, 11/13/2028 | | | 50,000 | | | | 46,564 | |
2.75%, 4/6/2030 | | | 90,000 | | | | 76,084 | |
6.38%, 12/15/2038 | | | 20,000 | | | | 20,444 | |
4.00%, 5/10/2046 | | | 33,000 | | | | 24,300 | |
3.25%, 4/6/2050 | | | 3,000 | | | | 1,891 | |
| | |
Visa, Inc. | | | | | | | | |
3.15%, 12/14/2025 | | | 20,000 | | | | 19,084 | |
2.05%, 4/15/2030 | | | 140,000 | | | | 113,254 | |
| | |
Voya Financial, Inc. | | | | | | | | |
4.70%, 1/23/2048(a) | | | 20,000 | | | | 15,690 | |
| | | | | | | 784,615 | |
|
Food Products – 0.9% | |
| | |
Bunge Ltd. Finance Corp. | | | | | | | | |
1.63%, 8/17/2025 | | | 47,000 | | | | 43,515 | |
| | |
Campbell Soup Co. | | | | | | | | |
4.15%, 3/15/2028 | | | 50,000 | | | | 46,580 | |
2.38%, 4/24/2030 | | | 17,000 | | | | 13,476 | |
| | |
General Mills, Inc. | | | | | | | | |
2.88%, 4/15/2030 | | | 50,000 | | | | 41,332 | |
4.95%, 3/29/2033 | | | 14,000 | | | | 12,715 | |
3.00%, 2/1/2051 | | | 7,000 | | | | 4,009 | |
| | |
Ingredion, Inc. | | | | | | | | |
2.90%, 6/1/2030 | | | 33,000 | | | | 27,096 | |
| | |
Mondelez International, Inc. | | | | | | | | |
2.63%, 9/4/2050 | | | 50,000 | | | | 27,234 | |
| | |
Tyson Foods, Inc. | | | | | | | | |
5.10%, 9/28/2048 | | | 23,000 | | | | 17,775 | |
| | | | | | | 233,732 | |
|
Gas Utilities – 0.4% | |
| | |
Atmos Energy Corp. | | | | | | | | |
5.75%, 10/15/2052 | | | 17,000 | | | | 15,598 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 447 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Gas Utilities – (continued) | |
| | |
National Fuel Gas Co. | | | | | | | | |
2.95%, 3/1/2031 | | $ | 14,000 | | | $ | 10,642 | |
| | |
Southern California Gas Co. | | | | | | | | |
2.95%, 4/15/2027 | | | 67,000 | | | | 61,074 | |
| | |
Spire Missouri, Inc. | | | | | | | | |
4.80%, 2/15/2033 | | | 7,000 | | | | 6,404 | |
| | |
Washington Gas Light Co. | | | | | | | | |
3.65%, 9/15/2049 | | | 7,000 | | | | 4,384 | |
| | | | | | | 98,102 | |
|
Ground Transportation – 2.0% | |
| | |
Canadian National Railway Co. | | | | | | | | |
3.65%, 2/3/2048 | | | 14,000 | | | | 9,678 | |
4.45%, 1/20/2049 | | | 37,000 | | | | 28,657 | |
4.40%, 8/5/2052 | | | 7,000 | | | | 5,409 | |
| | |
Canadian Pacific Railway Co. | | | | | | | | |
1.35%, 12/2/2024 | | | 50,000 | | | | 47,614 | |
5.75%, 3/15/2033 | | | 3,000 | | | | 2,872 | |
4.30%, 5/15/2043 | | | 10,000 | | | | 7,544 | |
4.80%, 8/1/2045 | | | 44,000 | | | | 35,057 | |
4.20%, 11/15/2069 | | | 17,000 | | | | 11,493 | |
| | |
CSX Corp. | | | | | | | | |
2.40%, 2/15/2030 | | | 33,000 | | | | 26,969 | |
5.20%, 11/15/2033 | | | 10,000 | | | | 9,385 | |
4.30%, 3/1/2048 | | | 57,000 | | | | 42,533 | |
3.80%, 4/15/2050 | | | 33,000 | | | | 22,319 | |
4.65%, 3/1/2068 | | | 3,000 | | | | 2,224 | |
| | |
JB Hunt Transport Services, Inc. | | | | | | | | |
3.88%, 3/1/2026 | | | 30,000 | | | | 28,791 | |
| | |
Norfolk Southern Corp. | | | | | | | | |
3.00%, 3/15/2032 | | | 54,000 | | | | 43,405 | |
4.45%, 3/1/2033 | | | 10,000 | | | | 8,872 | |
4.80%, 8/15/2043 | | | 50,000 | | | | 38,697 | |
5.35%, 8/1/2054 | | | 14,000 | | | | 11,948 | |
| | |
Union Pacific Corp. | | | | | | | | |
4.50%, 1/20/2033 | | | 80,000 | | | | 72,427 | |
2.89%, 4/6/2036 | | | 50,000 | | | | 36,638 | |
| | | | | | | 492,532 | |
|
Health Care Equipment & Supplies – 1.1% | |
| | |
Abbott Laboratories | | | | | | | | |
1.40%, 6/30/2030 | | | 33,000 | | | | 25,616 | |
4.90%, 11/30/2046 | | | 63,000 | | | | 54,341 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Health Care Equipment & Supplies – (continued) | |
| | |
Baxter International, Inc. | | | | | | | | |
1.73%, 4/1/2031 | | $ | 50,000 | | | $ | 36,320 | |
3.13%, 12/1/2051 | | | 33,000 | | | | 18,134 | |
| | |
Becton Dickinson & Co. | | | | | | | | |
3.79%, 5/20/2050 | | | 50,000 | | | | 33,665 | |
| | |
Boston Scientific Corp. | | | | | | | | |
2.65%, 6/1/2030 | | | 50,000 | | | | 41,125 | |
| | |
Medtronic, Inc. | | | | | | | | |
4.00%, 4/1/2043 | | | 14,000 | | | | 10,689 | |
4.63%, 3/15/2045 | | | 20,000 | | | | 16,507 | |
| | |
Zimmer Biomet Holdings, Inc. | | | | | | | | |
2.60%, 11/24/2031 | | | 50,000 | | | | 38,325 | |
| | | | | | | 274,722 | |
|
Health Care Providers & Services – 5.4% | |
| | |
Aetna, Inc. | | | | | | | | |
3.88%, 8/15/2047 | | | 26,000 | | | | 17,119 | |
| | |
Cardinal Health, Inc. | | | | | | | | |
4.90%, 9/15/2045 | | | 33,000 | | | | 25,213 | |
| | |
Cencora, Inc. | | | | | | | | |
2.70%, 3/15/2031 | | | 50,000 | | | | 39,621 | |
| | |
Cigna Group (The) | | | | | | | | |
4.38%, 10/15/2028 | | | 40,000 | | | | 37,386 | |
6.13%, 11/15/2041 | | | 33,000 | | | | 31,529 | |
3.88%, 10/15/2047 | | | 14,000 | | | | 9,543 | |
4.90%, 12/15/2048 | | | 67,000 | | | | 53,579 | |
3.40%, 3/15/2051 | | | 14,000 | | | | 8,626 | |
| | |
CVS Health Corp. | | | | | | | | |
3.88%, 7/20/2025 | | | 50,000 | | | | 48,368 | |
3.63%, 4/1/2027 | | | 33,000 | | | | 30,632 | |
4.30%, 3/25/2028 | | | 100,000 | | | | 93,689 | |
5.25%, 2/21/2033 | | | 80,000 | | | | 73,780 | |
4.78%, 3/25/2038 | | | 40,000 | | | | 33,084 | |
5.05%, 3/25/2048 | | | 114,000 | | | | 89,613 | |
| | |
Elevance Health, Inc. | | | | | | | | |
2.38%, 1/15/2025 | | | 100,000 | | | | 95,950 | |
2.25%, 5/15/2030 | | | 50,000 | | | | 39,861 | |
4.10%, 5/15/2032 | | | 54,000 | | | | 46,856 | |
4.75%, 2/15/2033 | | | 20,000 | | | | 18,136 | |
3.60%, 3/15/2051 | | | 52,000 | | | | 33,376 | |
6.10%, 10/15/2052 | | | 14,000 | | | | 13,238 | |
5.13%, 2/15/2053 | | | 20,000 | | | | 16,595 | |
| | |
HCA, Inc. | | | | | | | | |
3.63%, 3/15/2032 | | | 133,000 | | | | 106,835 | |
See Accompanying Notes to the Financial Statements.
| | | | |
448 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Health Care Providers & Services – (continued) | |
7.50%, 11/6/2033 | | $ | 47,000 | | | $ | 48,022 | |
4.63%, 3/15/2052 | | | 77,000 | | | | 53,607 | |
| | |
Laboratory Corp. of America Holdings | | | | | | | | |
1.55%, 6/1/2026 | | | 50,000 | | | | 44,768 | |
2.70%, 6/1/2031 | | | 50,000 | | | | 39,421 | |
| | |
Novant Health, Inc. | | | | | | | | |
3.32%, 11/1/2061 | | | 23,000 | | | | 13,307 | |
| | |
Quest Diagnostics, Inc. | | | | | | | | |
4.20%, 6/30/2029 | | | 33,000 | | | | 30,355 | |
| | |
UnitedHealth Group, Inc. | | | | | | | | |
4.00%, 5/15/2029 | | | 50,000 | | | | 46,264 | |
4.50%, 4/15/2033 | | | 10,000 | | | | 9,004 | |
5.88%, 2/15/2053 | | | 54,000 | | | | 51,068 | |
5.20%, 4/15/2063 | | | 30,000 | | | | 25,064 | |
| | | | | | | 1,323,509 | |
|
Health Care REITs – 0.4% | |
| | |
Healthcare Realty Holdings LP | | | | | | | | |
REIT, 2.05%, 3/15/2031 | | | 7,000 | | | | 4,975 | |
| | |
Ventas Realty LP | | | | | | | | |
REIT, 4.00%, 3/1/2028 | | | 33,000 | | | | 30,042 | |
REIT, 3.00%, 1/15/2030 | | | 33,000 | | | | 26,953 | |
| | |
Welltower OP LLC | | | | | | | | |
REIT, 3.85%, 6/15/2032 | | | 54,000 | | | | 44,812 | |
| | | | | | | 106,782 | |
|
Hotel & Resort REITs – 0.2% | |
| | |
Host Hotels & Resorts LP | | | | | | | | |
Series F, REIT, 4.50%, 2/1/2026 | | | 50,000 | | | | 47,830 | |
|
Hotels, Restaurants & Leisure – 1.5% | |
| | |
Marriott International, Inc. | | | | | | | | |
5.00%, 10/15/2027 | | | 20,000 | | | | 19,320 | |
Series HH, 2.85%, 4/15/2031 | | | 33,000 | | | | 25,932 | |
Series II, 2.75%, 10/15/2033 | | | 3,000 | | | | 2,197 | |
| | |
McDonald’s Corp. | | | | | | | | |
3.50%, 7/1/2027 | | | 50,000 | | | | 46,456 | |
4.70%, 12/9/2035 | | | 33,000 | | | | 28,955 | |
4.88%, 12/9/2045 | | | 33,000 | | | | 27,164 | |
3.63%, 9/1/2049 | | | 44,000 | | | | 29,162 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Hotels, Restaurants & Leisure – (continued) | |
5.15%, 9/9/2052 | | $ | 7,000 | | | $ | 5,901 | |
| | |
Sands China Ltd. | | | | | | | | |
4.30%, 1/8/2026(b) | | | 200,000 | | | | 185,522 | |
| | | | | | | 370,609 | |
|
Household Durables – 0.3% | |
| | |
Leggett & Platt, Inc. | | | | | | | | |
3.50%, 11/15/2051 | | | 14,000 | | | | 8,372 | |
| | |
Lennar Corp. | | | | | | | | |
5.00%, 6/15/2027 | | | 26,000 | | | | 25,090 | |
| | |
Mohawk Industries, Inc. | | | | | | | | |
5.85%, 9/18/2028 | | | 12,000 | | | | 11,790 | |
3.63%, 5/15/2030 | | | 7,000 | | | | 6,005 | |
| | |
NVR, Inc. | | | | | | | | |
3.00%, 5/15/2030 | | | 14,000 | | | | 11,491 | |
| | | | | | | 62,748 | |
|
Household Products – 0.0%(c) | |
| | |
Clorox Co. (The) | | | | | | | | |
4.60%, 5/1/2032 | | | 14,000 | | | | 12,637 | |
|
Independent Power and Renewable Electricity Producers – 0.4% | |
| | |
Constellation Energy Generation LLC | | | | | | | | |
3.25%, 6/1/2025 | | | 50,000 | | | | 47,846 | |
5.60%, 3/1/2028 | | | 40,000 | | | | 39,268 | |
6.13%, 1/15/2034 | | | 10,000 | | | | 9,666 | |
| | | | | | | 96,780 | |
|
Industrial REITs – 0.3% | |
| | |
Prologis LP | | | | | | | | |
REIT, 4.63%, 1/15/2033 | | | 47,000 | | | | 42,110 | |
REIT, 5.13%, 1/15/2034 | | | 14,000 | | | | 12,820 | |
REIT, 3.00%, 4/15/2050 | | | 23,000 | | | | 13,247 | |
| | | | | | | 68,177 | |
|
Insurance – 3.3% | |
| | |
Aflac, Inc. | | | | | | | | |
3.60%, 4/1/2030 | | | 33,000 | | | | 28,746 | |
| | |
Allstate Corp. (The) | | | | | | | | |
5.25%, 3/30/2033 | | | 10,000 | | | | 9,235 | |
3.85%, 8/10/2049 | | | 26,000 | | | | 17,145 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 449 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Insurance – (continued) | |
| | |
American International Group, Inc. | | | | | | | | |
5.13%, 3/27/2033 | | $ | 17,000 | | | $ | 15,459 | |
4.75%, 4/1/2048 | | | 50,000 | | | | 39,159 | |
| | |
Arch Capital Finance LLC | | | | | | | | |
5.03%, 12/15/2046 | | | 10,000 | | | | 7,994 | |
| | |
Assurant, Inc. | | | | | | | | |
2.65%, 1/15/2032 | | | 3,000 | | | | 2,161 | |
| | |
AXIS Specialty Finance LLC | | | | | | | | |
4.90%, 1/15/2040(a) | | | 17,000 | | | | 13,374 | |
| | |
Chubb INA Holdings, Inc. | | | | | | | | |
3.35%, 5/3/2026 | | | 100,000 | | | | 94,704 | |
4.35%, 11/3/2045 | | | 14,000 | | | | 10,926 | |
3.05%, 12/15/2061 | | | 10,000 | | | | 5,626 | |
| | |
Everest Reinsurance Holdings, Inc. | | | | | | | | |
3.13%, 10/15/2052 | | | 20,000 | | | | 11,238 | |
| | |
Fidelity National Financial, Inc. | | | | | | | | |
3.20%, 9/17/2051 | | | 14,000 | | | | 7,295 | |
| | |
Hartford Financial Services Group, Inc. (The) | | | | | | | | |
3.60%, 8/19/2049 | | | 23,000 | | | | 14,894 | |
2.90%, 9/15/2051 | | | 14,000 | | | | 7,710 | |
| | |
Lincoln National Corp. | | | | | | | | |
3.05%, 1/15/2030 | | | 20,000 | | | | 15,800 | |
4.35%, 3/1/2048 | | | 3,000 | | | | 1,955 | |
4.38%, 6/15/2050 | | | 10,000 | | | | 6,521 | |
| | |
Manulife Financial Corp. | | | | | | | | |
4.06%, 2/24/2032(a) | | | 50,000 | | | | 45,123 | |
3.70%, 3/16/2032 | | | 7,000 | | | | 5,967 | |
| | |
MetLife, Inc. | | | | | | | | |
4.55%, 3/23/2030 | | | 20,000 | | | | 18,597 | |
5.38%, 7/15/2033 | | | 10,000 | | | | 9,351 | |
10.75%, 8/1/2039 | | | 33,000 | | | | 41,651 | |
4.60%, 5/13/2046 | | | 26,000 | | | | 20,323 | |
5.00%, 7/15/2052 | | | 23,000 | | | | 18,580 | |
5.25%, 1/15/2054 | | | 14,000 | | | | 11,707 | |
| | |
Principal Financial Group, Inc. | | | | | | | | |
3.70%, 5/15/2029 | | | 33,000 | | | | 29,320 | |
2.13%, 6/15/2030 | | | 33,000 | | | | 25,631 | |
| | |
Prudential Financial, Inc. | | | | | | | | |
1.50%, 3/10/2026 | | | 100,000 | | | | 90,379 | |
4.50%, 9/15/2047(a) | | | 50,000 | | | | 43,821 | |
4.35%, 2/25/2050 | | | 33,000 | | | | 24,171 | |
3.70%, 3/13/2051 | | | 14,000 | | | | 9,118 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Insurance – (continued) | |
6.00%, 9/1/2052(a) | | $ | 47,000 | | | $ | 42,044 | |
| | |
RenaissanceRe Holdings Ltd. | | | | | | | | |
5.75%, 6/5/2033 | | | 7,000 | | | | 6,440 | |
| | |
Travelers Cos., Inc. (The) | | | | | | | | |
4.00%, 5/30/2047 | | | 40,000 | | | | 29,068 | |
5.45%, 5/25/2053 | | | 17,000 | | | | 15,273 | |
| | |
Unum Group | | | | | | | | |
4.13%, 6/15/2051 | | | 14,000 | | | | 8,723 | |
| | | | | | | 805,229 | |
|
Interactive Media & Services – 1.2% | |
| | |
Alphabet, Inc. | | | | | | | | |
0.80%, 8/15/2027 | | | 67,000 | | | | 57,364 | |
1.10%, 8/15/2030 | | | 10,000 | | | | 7,665 | |
1.90%, 8/15/2040 | | | 7,000 | | | | 4,185 | |
2.05%, 8/15/2050 | | | 50,000 | | | | 25,847 | |
| | |
Meta Platforms, Inc. | | | | | | | | |
4.60%, 5/15/2028 | | | 180,000 | | | | 174,481 | |
4.65%, 8/15/2062 | | | 40,000 | | | | 30,162 | |
5.75%, 5/15/2063 | | | 8,000 | | | | 7,177 | |
| | | | | | | 306,881 | |
|
IT Services – 2.1% | |
| | |
Amdocs Ltd. | | | | | | | | |
2.54%, 6/15/2030 | | | 10,000 | | | | 7,870 | |
| | |
DXC Technology Co. | | | | | | | | |
1.80%, 9/15/2026 | | | 10,000 | | | | 8,764 | |
| | |
International Business Machines Corp. | | | | | | | | |
4.00%, 7/27/2025 | | | 377,000 | | | | 366,966 | |
1.95%, 5/15/2030 | | | 100,000 | | | | 78,872 | |
2.85%, 5/15/2040 | | | 72,000 | | | | 46,125 | |
| | | | | | | 508,597 | |
|
Leisure Products – 0.2% | |
| | |
Hasbro, Inc. | | | | | | | | |
3.90%, 11/19/2029 | | | 33,000 | | | | 28,353 | |
6.35%, 3/15/2040 | | | 10,000 | | | | 9,117 | |
| | | | | | | 37,470 | |
|
Machinery – 1.0% | |
| | |
CNH Industrial Capital LLC | | | | | | | | |
4.55%, 4/10/2028 | | | 10,000 | | | | 9,397 | |
See Accompanying Notes to the Financial Statements.
| | | | |
450 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Machinery – (continued) | |
| | |
Cummins, Inc. | | | | | | | | |
1.50%, 9/1/2030 | | $ | 37,000 | | | $ | 28,265 | |
| | |
Ingersoll Rand, Inc. | | | | | | | | |
5.40%, 8/14/2028 | | | 23,000 | | | | 22,411 | |
| | |
Otis Worldwide Corp. | | | | | | | | |
2.57%, 2/15/2030 | | | 20,000 | | | | 16,273 | |
| | |
Stanley Black & Decker, Inc. | | | | | | | | |
3.40%, 3/1/2026 | | | 67,000 | | | | 63,160 | |
2.75%, 11/15/2050 | | | 7,000 | | | | 3,568 | |
4.00%, 3/15/2060(a) | | | 96,000 | | | | 78,802 | |
| | |
Westinghouse Air Brake Technologies Corp. | | | | | | | | |
4.70%, 9/15/2028(b) | | | 17,000 | | | | 15,851 | |
| | |
Xylem, Inc. | | | | | | | | |
2.25%, 1/30/2031 | | | 17,000 | | | | 13,139 | |
| | | | | | | 250,866 | |
|
Marine Transportation – 0.1% | |
| | |
Kirby Corp. | | | | | | | | |
4.20%, 3/1/2028 | | | 20,000 | | | | 18,423 | |
|
Media – 2.0% | |
| | |
Comcast Corp. | | | | | | | | |
2.65%, 2/1/2030 | | | 67,000 | | | | 55,602 | |
4.65%, 2/15/2033 | | | 67,000 | | | | 60,632 | |
4.00%, 3/1/2048 | | | 54,000 | | | | 38,074 | |
2.89%, 11/1/2051 | | | 327,000 | | | | 180,591 | |
2.99%, 11/1/2063 | | | 60,000 | | | | 30,803 | |
5.50%, 5/15/2064 | | | 3,000 | | | | 2,558 | |
| | |
Fox Corp. | | | | | | | | |
4.71%, 1/25/2029 | | | 50,000 | | | | 46,727 | |
5.58%, 1/25/2049 | | | 20,000 | | | | 15,757 | |
| | |
Interpublic Group of Cos., Inc. (The) | | | | | | | | |
3.38%, 3/1/2041 | | | 20,000 | | | | 12,675 | |
| | |
Paramount Global | | | | | | | | |
4.38%, 3/15/2043 | | | 30,000 | | | | 17,998 | |
4.95%, 5/19/2050 | | | 40,000 | | | | 25,368 | |
| | | | | | | 486,785 | |
|
Metals & Mining – 0.4% | |
| | |
Newmont Corp. | | | | | | | | |
5.88%, 4/1/2035 | | | 57,000 | | | | 55,013 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Metals & Mining – (continued) | |
| | |
Nucor Corp. | | | | | | | | |
3.13%, 4/1/2032 | | $ | 33,000 | | | $ | 26,660 | |
2.98%, 12/15/2055 | | | 14,000 | | | | 7,499 | |
| | | | | | | 89,172 | |
|
Multi-Utilities – 1.9% | |
| | |
Consolidated Edison Co. of New York, Inc. | | | | | | | | |
Series 20A, 3.35%, 4/1/2030 | | | 10,000 | | | | 8,605 | |
2.40%, 6/15/2031 | | | 50,000 | | | | 39,297 | |
6.15%, 11/15/2052 | | | 7,000 | | | | 6,657 | |
4.50%, 5/15/2058 | | | 67,000 | | | | 47,946 | |
3.60%, 6/15/2061 | | | 23,000 | | | | 14,013 | |
| | |
NiSource, Inc. | | | | | | | | |
0.95%, 8/15/2025 | | | 167,000 | | | | 152,582 | |
1.70%, 2/15/2031 | | | 54,000 | | | | 39,550 | |
| | |
Public Service Enterprise Group, Inc. | | | | | | | | |
5.85%, 11/15/2027 | | | 63,000 | | | | 62,666 | |
1.60%, 8/15/2030 | | | 10,000 | | | | 7,504 | |
| | |
San Diego Gas & Electric Co. | | | | | | | | |
Series VVV, 1.70%, 10/1/2030 | | | 10,000 | | | | 7,560 | |
2.95%, 8/15/2051 | | | 57,000 | | | | 32,401 | |
| | |
Sempra | | | | | | | | |
3.80%, 2/1/2038 | | | 26,000 | | | | 19,388 | |
4.00%, 2/1/2048 | | | 33,000 | | | | 22,530 | |
| | | | | | | 460,699 | |
|
Office REITs – 0.6% | |
| | |
Boston Properties LP | | | | | | | | |
REIT, 3.25%, 1/30/2031 | | | 50,000 | | | | 37,926 | |
REIT, 2.45%, 10/1/2033 | | | 33,000 | | | | 21,450 | |
| | |
Highwoods Realty LP | | | | | | | | |
REIT, 3.05%, 2/15/2030 | | | 20,000 | | | | 14,992 | |
| | |
Hudson Pacific Properties LP | | | | | | | | |
REIT, 5.95%, 2/15/2028 | | | 20,000 | | | | 15,743 | |
| | |
Kilroy Realty LP | | | | | | | | |
REIT, 4.38%, 10/1/2025 | | | 50,000 | | | | 47,764 | |
| | |
Piedmont Operating Partnership LP | | | | | | | | |
REIT, 2.75%, 4/1/2032 | | | 7,000 | | | | 4,475 | |
| | | | | | | 142,350 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 451 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Oil, Gas & Consumable Fuels – 6.9% | |
| | |
BP Capital Markets America, Inc. | | | | | | | | |
3.38%, 2/8/2061 | | $ | 10,000 | | | $ | 5,918 | |
| | |
Canadian Natural Resources Ltd. | | | | | | | | |
2.95%, 7/15/2030 | | | 87,000 | | | | 70,943 | |
| | |
Cheniere Corpus Christi Holdings LLC | | | | | | | | |
3.70%, 11/15/2029 | | | 17,000 | | | | 14,812 | |
2.74%, 12/31/2039 | | | 10,000 | | | | 7,210 | |
| | |
Cheniere Energy Partners LP | | | | | | | | |
5.95%, 6/30/2033(d) | | | 33,000 | | | | 30,861 | |
| | |
Cheniere Energy, Inc. | | | | | | | | |
4.63%, 10/15/2028 | | | 14,000 | | | | 12,792 | |
| | |
ConocoPhillips Co. | | | | | | | | |
3.76%, 3/15/2042 | | | 47,000 | | | | 34,143 | |
5.95%, 3/15/2046 | | | 23,000 | | | | 21,532 | |
5.30%, 5/15/2053 | | | 7,000 | | | | 6,043 | |
| | |
Enbridge, Inc. | | | | | | | | |
2.50%, 8/1/2033 | | | 77,000 | | | | 55,552 | |
5.50%, 12/1/2046 | | | 14,000 | | | | 11,681 | |
5.50%, 7/15/2077(a) | | | 50,000 | | | | 42,540 | |
| | |
Enterprise Products Operating LLC | | | | | | | | |
2.80%, 1/31/2030 | | | 20,000 | | | | 16,706 | |
4.25%, 2/15/2048 | | | 133,000 | | | | 99,523 | |
| | |
EQT Corp. | | | | | | | | |
5.70%, 4/1/2028 | | | 26,000 | | | | 25,293 | |
| | |
Hess Corp. | | | | | | | | |
6.00%, 1/15/2040 | | | 17,000 | | | | 16,424 | |
5.80%, 4/1/2047 | | | 20,000 | | | | 18,881 | |
| | |
Kinder Morgan Energy Partners LP | | | | | | | | |
6.95%, 1/15/2038 | | | 50,000 | | | | 49,567 | |
5.40%, 9/1/2044 | | | 20,000 | | | | 16,103 | |
| | |
Kinder Morgan, Inc. | | | | | | | | |
4.30%, 6/1/2025 | | | 237,000 | | | | 230,676 | |
2.00%, 2/15/2031 | | | 14,000 | | | | 10,462 | |
5.55%, 6/1/2045 | | | 33,000 | | | | 27,163 | |
3.60%, 2/15/2051 | | | 10,000 | | | | 6,020 | |
| | |
Magellan Midstream Partners LP | | | | | | | | |
3.95%, 3/1/2050 | | | 33,000 | | | | 20,824 | |
| | |
Marathon Petroleum Corp. | | | | | | | | |
4.50%, 4/1/2048 | | | 33,000 | | | | 23,435 | |
| | |
MPLX LP | | | | | | | | |
1.75%, 3/1/2026 | | | 50,000 | | | | 45,365 | |
2.65%, 8/15/2030 | | | 17,000 | | | | 13,430 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Oil, Gas & Consumable Fuels – (continued) | |
4.50%, 4/15/2038 | | $ | 67,000 | | | $ | 52,197 | |
5.50%, 2/15/2049 | | | 30,000 | | | | 24,215 | |
| | |
Occidental Petroleum Corp. | | | | | | | | |
6.45%, 9/15/2036 | | | 40,000 | | | | 38,851 | |
| | |
ONEOK, Inc. | | | | | | | | |
5.65%, 11/1/2028 | | | 40,000 | | | | 39,032 | |
6.10%, 11/15/2032 | | | 25,000 | | | | 24,091 | |
4.50%, 3/15/2050 | | | 60,000 | | | | 41,427 | |
| | |
Pioneer Natural Resources Co. | | | | | | | | |
2.15%, 1/15/2031 | | | 26,000 | | | | 20,419 | |
| | |
Plains All American Pipeline LP | | | | | | | | |
4.50%, 12/15/2026 | | | 80,000 | | | | 76,241 | |
3.80%, 9/15/2030 | | | 10,000 | | | | 8,427 | |
| | |
Sabine Pass Liquefaction LLC | | | | | | | | |
4.50%, 5/15/2030 | | | 17,000 | | | | 15,248 | |
5.90%, 9/15/2037 | | | 20,000 | | | | 19,167 | |
| | |
TotalEnergies Capital International SA | | | | | | | | |
2.83%, 1/10/2030 | | | 50,000 | | | | 42,636 | |
3.13%, 5/29/2050 | | | 44,000 | | | | 26,892 | |
| | |
Transcanada Trust | | | | | | | | |
5.60%, 3/7/2082(a) | | | 177,000 | | | | 136,612 | |
| | |
Transcontinental Gas Pipe Line Co. LLC | | | | | | | | |
3.25%, 5/15/2030 | | | 33,000 | | | | 27,636 | |
| | |
Valero Energy Corp. | | | | | | | | |
2.80%, 12/1/2031 | | | 50,000 | | | | 38,699 | |
4.00%, 6/1/2052 | | | 10,000 | | | | 6,499 | |
| | |
Western Midstream Operating LP | | | | | | | | |
5.30%, 3/1/2048 | | | 23,000 | | | | 17,182 | |
5.25%, 2/1/2050(b) | | | 7,000 | | | | 5,173 | |
| | |
Williams Cos., Inc. (The) | | | | | | | | |
5.65%, 3/15/2033 | | | 33,000 | | | | 31,134 | |
5.75%, 6/24/2044 | | | 33,000 | | | | 28,769 | |
5.10%, 9/15/2045 | | | 37,000 | | | | 29,741 | |
4.85%, 3/1/2048 | | | 14,000 | | | | 10,720 | |
5.30%, 8/15/2052 | | | 14,000 | | | | 11,382 | |
| | | | | | | 1,706,289 | |
|
Paper & Forest Products – 0.2% | |
| | |
Suzano Austria GmbH | | | | | | | | |
Series DM3N, 3.13%, 1/15/2032 | | | 50,000 | | | | 37,682 | |
See Accompanying Notes to the Financial Statements.
| | | | |
452 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Personal Care Products – 1.3% | |
| | |
Estee Lauder Cos., Inc. (The) | | | | | | | | |
3.15%, 3/15/2027 | | $ | 50,000 | | | $ | 46,268 | |
4.38%, 5/15/2028 | | | 20,000 | | | | 19,097 | |
1.95%, 3/15/2031 | | | 33,000 | | | | 25,304 | |
| | |
Haleon US Capital LLC | | | | | | | | |
3.38%, 3/24/2027 | | | 250,000 | | | | 230,543 | |
| | | | | | | 321,212 | |
|
Pharmaceuticals – 5.2% | |
| | |
AstraZeneca Finance LLC | | | | | | | | |
4.88%, 3/3/2033 | | | 33,000 | | | | 31,030 | |
| | |
AstraZeneca plc | | | | | | | | |
4.00%, 9/18/2042 | | | 20,000 | | | | 15,506 | |
4.38%, 11/16/2045 | | | 50,000 | | | | 39,745 | |
3.00%, 5/28/2051 | | | 14,000 | | | | 8,580 | |
| | |
Bristol-Myers Squibb Co. | | | | | | | | |
5.00%, 8/15/2045 | | | 33,000 | | | | 28,094 | |
3.90%, 3/15/2062 | | | 91,000 | | | | 59,493 | |
| | |
GlaxoSmithKline Capital plc | | | | | | | | |
3.38%, 6/1/2029 | | | 33,000 | | | | 29,739 | |
| | |
GlaxoSmithKline Capital, Inc. | | | | | | | | |
6.38%, 5/15/2038 | | | 17,000 | | | | 17,694 | |
| | |
Johnson & Johnson | | | | | | | | |
3.63%, 3/3/2037 | | | 180,000 | | | | 146,062 | |
2.10%, 9/1/2040 | | | 10,000 | | | | 6,074 | |
3.70%, 3/1/2046 | | | 50,000 | | | | 36,874 | |
2.25%, 9/1/2050 | | | 20,000 | | | | 10,751 | |
2.45%, 9/1/2060 | | | 7,000 | | | | 3,593 | |
| | |
Merck & Co., Inc. | | | | | | | | |
4.05%, 5/17/2028 | | | 133,000 | | | | 126,600 | |
3.40%, 3/7/2029 | | | 50,000 | | | | 45,205 | |
2.35%, 6/24/2040 | | | 133,000 | | | | 82,514 | |
2.75%, 12/10/2051 | | | 33,000 | | | | 18,635 | |
| | |
Mylan, Inc. | | | | | | | | |
5.20%, 4/15/2048 | | | 37,000 | | | | 25,439 | |
| | |
Novartis Capital Corp. | | | | | | | | |
2.00%, 2/14/2027 | | | 50,000 | | | | 45,014 | |
2.75%, 8/14/2050 | | | 50,000 | | | | 29,715 | |
| | |
Pfizer Investment Enterprises Pte. Ltd. | | | | | | | | |
4.45%, 5/19/2028 | | | 124,000 | | | | 118,520 | |
5.34%, 5/19/2063 | | | 100,000 | | | | 85,666 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Pharmaceuticals – (continued) | |
| | |
Pfizer, Inc. | | | | | | | | |
0.80%, 5/28/2025 | | $ | 50,000 | | | $ | 46,486 | |
3.45%, 3/15/2029 | | | 50,000 | | | | 45,414 | |
1.75%, 8/18/2031 | | | 33,000 | | | | 24,898 | |
4.10%, 9/15/2038 | | | 35,000 | | | | 28,182 | |
7.20%, 3/15/2039 | | | 57,000 | | | | 62,825 | |
2.55%, 5/28/2040 | | | 33,000 | | | | 20,949 | |
2.70%, 5/28/2050 | | | 33,000 | | | | 19,146 | |
| | |
Viatris, Inc. | | | | | | | | |
3.85%, 6/22/2040 | | | 10,000 | | | | 6,224 | |
4.00%, 6/22/2050 | | | 23,000 | | | | 13,232 | |
| | | | | | | 1,277,899 | |
|
Professional Services – 0.3% | |
| | |
Automatic Data Processing, Inc. | | | | | | | | |
1.70%, 5/15/2028 | | | 26,000 | | | | 22,319 | |
| | |
Concentrix Corp. | | | | | | | | |
6.60%, 8/2/2028 | | | 10,000 | | | | 9,600 | |
| | |
Equifax, Inc. | | | | | | | | |
3.10%, 5/15/2030 | | | 7,000 | | | | 5,747 | |
| | |
Verisk Analytics, Inc. | | | | | | | | |
4.13%, 3/15/2029 | | | 40,000 | | | | 36,613 | |
| | | | | | | 74,279 | |
|
Real Estate Management & Development – 0.1% | |
| | |
CBRE Services, Inc. | | | | | | | | |
2.50%, 4/1/2031 | | | 20,000 | | | | 15,056 | |
|
Residential REITs – 0.7% | |
| | |
AvalonBay Communities, Inc. | | | | | | | | |
REIT, 2.95%, 5/11/2026 | | | 100,000 | | | | 93,449 | |
REIT, 5.00%, 2/15/2033 | | | 14,000 | | | | 13,008 | |
| | |
ERP Operating LP | | | | | | | | |
REIT, 3.00%, 7/1/2029 | | | 67,000 | | | | 57,528 | |
| | |
UDR, Inc. | | | | | | | | |
REIT, 4.40%, 1/26/2029 | | | 7,000 | | | | 6,381 | |
| | | | | | | 170,366 | |
|
Retail REITs – 0.5% | |
| | |
Brixmor Operating Partnership LP | | | | | | | | |
REIT, 3.90%, 3/15/2027 | | | 33,000 | | | | 30,192 | |
REIT, 2.25%, 4/1/2028 | | | 10,000 | | | | 8,348 | |
REIT, 2.50%, 8/16/2031 | | | 7,000 | | | | 5,147 | |
| | |
Federal Realty OP LP | | | | | | | | |
REIT, 1.25%, 2/15/2026 | | | 67,000 | | | | 60,187 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 453 | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Retail REITs – (continued) | |
| | |
Regency Centers LP | | | | | | | | |
REIT, 3.70%, 6/15/2030 | | $ | 26,000 | | | $ | 22,078 | |
| | | | | | | 125,952 | |
|
Semiconductors & Semiconductor Equipment – 2.8% | |
| | |
Intel Corp. | | | | | | | | |
3.75%, 3/25/2027 | | | 100,000 | | | | 94,359 | |
2.00%, 8/12/2031 | | | 47,000 | | | | 35,988 | |
5.63%, 2/10/2043 | | | 54,000 | | | | 49,445 | |
3.73%, 12/8/2047 | | | 47,000 | | | | 31,633 | |
4.75%, 3/25/2050 | | | 127,000 | | | | 99,730 | |
4.95%, 3/25/2060 | | | 33,000 | | | | 26,462 | |
| | |
Micron Technology, Inc. | | | | | | | | |
5.88%, 9/15/2033 | | | 54,000 | | | | 49,854 | |
| | |
QUALCOMM, Inc. | | | | | | | | |
3.45%, 5/20/2025 | | | 50,000 | | | | 48,456 | |
| | |
TSMC Arizona Corp. | | | | | | | | |
3.88%, 4/22/2027 | | | 280,000 | | | | 265,411 | |
| | | | | | | 701,338 | |
|
Software – 2.4% | |
| | |
Adobe, Inc. | | | | | | | | |
2.30%, 2/1/2030 | | | 33,000 | | | | 27,431 | |
| | |
Autodesk, Inc. | | | | | | | | |
2.85%, 1/15/2030 | | | 20,000 | | | | 16,688 | |
| | |
Microsoft Corp. | | | | | | | | |
2.40%, 8/8/2026 | | | 60,000 | | | | 55,800 | |
3.30%, 2/6/2027 | | | 133,000 | | | | 125,647 | |
3.45%, 8/8/2036 | | | 33,000 | | | | 26,910 | |
2.53%, 6/1/2050 | | | 180,000 | | | | 103,036 | |
2.92%, 3/17/2052 | | | 40,000 | | | | 24,692 | |
2.68%, 6/1/2060 | | | 33,000 | | | | 18,247 | |
3.04%, 3/17/2062 | | | 20,000 | | | | 11,876 | |
| | |
Salesforce, Inc. | | | | | | | | |
1.50%, 7/15/2028 | | | 50,000 | | | | 42,101 | |
2.90%, 7/15/2051 | | | 44,000 | | | | 25,878 | |
| | |
ServiceNow, Inc. | | | | | | | | |
1.40%, 9/1/2030 | | | 14,000 | | | | 10,553 | |
| | |
VMware, Inc. | | | | | | | | |
1.40%, 8/15/2026 | | | 100,000 | | | | 88,087 | |
| | |
Workday, Inc. | | | | | | | | |
3.70%, 4/1/2029 | | | 30,000 | | | | 26,786 | |
| | | | | | | 603,732 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Specialized REITs – 0.3% | |
| | |
Equinix, Inc. | | | | | | | | |
REIT, 3.20%, 11/18/2029 | | $ | 50,000 | | | $ | 42,249 | |
REIT, 3.40%, 2/15/2052 | | | 26,000 | | | | 15,421 | |
| | |
Weyerhaeuser Co. | | | | | | | | |
REIT, 3.38%, 3/9/2033 | | | 30,000 | | | | 23,807 | |
| | | | | | | 81,477 | |
|
Specialty Retail – 1.8% | |
| | |
Dick’s Sporting Goods, Inc. | | | | | | | | |
4.10%, 1/15/2052 | | | 10,000 | | | | 5,850 | |
| | |
Home Depot, Inc. (The) | | | | | | | | |
3.30%, 4/15/2040 | | | 100,000 | | | | 70,702 | |
4.95%, 9/15/2052 | | | 100,000 | | | | 84,171 | |
| | |
Lowe’s Cos., Inc. | | | | | | | | |
2.50%, 4/15/2026 | | | 33,000 | | | | 30,658 | |
3.65%, 4/5/2029 | | | 50,000 | | | | 44,853 | |
2.63%, 4/1/2031 | | | 50,000 | | | | 39,492 | |
5.00%, 4/15/2033 | | | 77,000 | | | | 70,051 | |
5.50%, 10/15/2035 | | | 33,000 | | | | 30,820 | |
2.80%, 9/15/2041 | | | 33,000 | | | | 20,044 | |
3.00%, 10/15/2050 | | | 33,000 | | | | 18,138 | |
4.45%, 4/1/2062 | | | 26,000 | | | | 17,752 | |
5.85%, 4/1/2063 | | | 14,000 | | | | 11,944 | |
| | | | | | | 444,475 | |
|
Technology Hardware, Storage & Peripherals – 2.2% | |
| | |
Apple, Inc. | | | | | | | | |
3.25%, 2/23/2026 | | | 84,000 | | | | 80,394 | |
2.38%, 2/8/2041 | | | 80,000 | | | | 51,042 | |
4.45%, 5/6/2044 | | | 114,000 | | | | 96,137 | |
4.65%, 2/23/2046 | | | 33,000 | | | | 28,154 | |
4.85%, 5/10/2053 | | | 100,000 | | | | 86,864 | |
4.10%, 8/8/2062 | | | 47,000 | | | | 34,465 | |
| | |
Dell International LLC | | | | | | | | |
8.10%, 7/15/2036 | | | 50,000 | | | | 54,227 | |
3.38%, 12/15/2041 | | | 30,000 | | | | 19,326 | |
| | |
Hewlett Packard Enterprise Co. | | | | | | | | |
5.25%, 7/1/2028 | | | 50,000 | | | | 48,280 | |
6.20%, 10/15/2035(b) | | | 7,000 | | | | 6,871 | |
| | |
HP, Inc. | | | | | | | | |
2.65%, 6/17/2031 | | | 19,000 | | | | 14,500 | |
6.00%, 9/15/2041 | | | 33,000 | | | | 29,884 | |
| | | | | | | 550,144 | |
See Accompanying Notes to the Financial Statements.
| | | | |
454 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Textiles, Apparel & Luxury Goods – 0.2% | |
| | |
PVH Corp. | | | | | | | | |
4.63%, 7/10/2025 | | $ | 20,000 | | | $ | 19,188 | |
| | |
Ralph Lauren Corp. | | | | | | | | |
2.95%, 6/15/2030 | | | 14,000 | | | | 11,726 | |
| | |
VF Corp. | | | | | | | | |
2.95%, 4/23/2030 | | | 26,000 | | | | 20,364 | |
| | | | | | | 51,278 | |
|
Water Utilities – 0.5% | |
| | |
American Water Capital Corp. | | | | | | | | |
2.30%, 6/1/2031 | | | 100,000 | | | | 77,745 | |
| | |
Essential Utilities, Inc. | | | | | | | | |
2.70%, 4/15/2030 | | | 33,000 | | | | 26,651 | |
5.30%, 5/1/2052 | | | 7,000 | | | | 5,652 | |
| | |
Veralto Corp. | | | | | | | | |
5.50%, 9/18/2026(d) | | | 15,000 | | | | 14,849 | |
| | | | | | | 124,897 | |
|
Wireless Telecommunication Services – 0.3% | |
| | |
T-Mobile USA, Inc. | | | | | | | | |
3.88%, 4/15/2030 | | | 3,000 | | | | 2,612 | |
| | |
Vodafone Group plc | | | | | | | | |
5.00%, 5/30/2038 | | | 3,000 | | | | 2,598 | |
5.63%, 2/10/2053 | | | 96,000 | | | | 80,743 | |
| | | | | | | 85,953 | |
Total Corporate Bonds (Cost $27,258,976) | | | | 23,856,368 | |
| | | | | | | | |
Total Investments – 96.7% (Cost $27,258,976) | | | | 23,856,368 | |
| |
Other assets less liabilities – 3.3% | | | | 815,779 | |
NET ASSETS – 100.0% | | | $ | 24,672,147 | |
(a) | Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end. |
(b) | Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2023. |
(c) | Represents less than 0.05% of net assets. |
(d) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
Percentages shown are based on Net Assets.
Abbreviations
OYJ Public Limited Company
REIT Real Estate Investment Trust
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 583 | |
Aggregate gross unrealized depreciation | | | (3,498,532 | ) |
Net unrealized depreciation | | $ | (3,497,949 | ) |
Federal income tax cost | | $ | 27,354,317 | |
| | | | |
Security Type | | % of Net Assets | |
Corporate Bonds | | | 96.7 | % |
Others(1) | | | 3.3 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 455 | |
Schedule of Investments
FlexShares® Ultra-Short Income Fund
October 31, 2023
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – 86.9% | |
|
Aerospace & Defense – 2.0% | |
| | |
Boeing Co. (The) | | | | | | | | |
1.95%, 2/1/2024 | | $ | 900,000 | | | $ | 890,799 | |
1.43%, 2/4/2024 | | | 3,000,000 | | | | 2,961,958 | |
| | |
L3Harris Technologies, Inc. | | | | | | | | |
3.95%, 5/28/2024 | | | 4,065,000 | | | | 4,019,740 | |
| | |
Northrop Grumman Corp. | | | | | | | | |
2.93%, 1/15/2025 | | | 5,673,000 | | | | 5,479,281 | |
| | |
RTX Corp. | | | | | | | | |
3.20%, 3/15/2024 | | | 8,205,000 | | | | 8,120,480 | |
| | | | | | | 21,472,258 | |
|
Agricultural & Farm Machinery – 0.1% | |
| | |
CNH Industrial Capital LLC | | | | | | | | |
3.95%, 5/23/2025 | | | 1,290,000 | | | | 1,250,071 | |
|
Apparel Retail – 0.5% | |
| | |
Ross Stores, Inc. | | | | | | | | |
4.60%, 4/15/2025 | | | 5,011,000 | | | | 4,916,769 | |
|
Apparel, Accessories & Luxury Goods – 0.4% | |
| | |
VF Corp. | | | | | | | | |
2.40%, 4/23/2025 | | | 5,000,000 | | | | 4,708,104 | |
|
Application Software – 1.1% | |
| | |
Autodesk, Inc. | | | | | | | | |
4.38%, 6/15/2025 | | | 2,000,000 | | | | 1,954,881 | |
| | |
Intuit, Inc. | | | | | | | | |
5.25%, 9/15/2026 | | | 4,950,000 | | | | 4,935,258 | |
| | |
Roper Technologies, Inc. | | | | | | | | |
2.35%, 9/15/2024 | | | 5,000,000 | | | | 4,845,769 | |
| | | | | | | 11,735,908 | |
|
Asset Management & Custody Banks – 1.9% | |
| | |
Bank of New York Mellon Corp. (The) | | | | | | | | |
Series 0012, 3.65%, 2/4/2024 | | | 3,000,000 | | | | 2,980,840 | |
2.10%, 10/24/2024 | | | 3,000,000 | | | | 2,892,049 | |
Series J, (SOFR + 0.20%), 5.51%, 10/25/2024(a) | | | 2,800,000 | | | | 2,787,418 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Asset Management & Custody Banks – (continued) | |
| | |
Blackstone Private Credit Fund | | | | | | | | |
2.70%, 1/15/2025 | | $ | 800,000 | | | $ | 759,198 | |
| | |
FS KKR Capital Corp. | | | | | | | | |
1.65%, 10/12/2024 | | | 980,000 | | | | 934,485 | |
| | |
State Street Corp. | | | | | | | | |
(United States SOFR Compounded Index + 0.85%), 6.23%, 8/3/2026(a) | | | 10,000,000 | | | | 9,997,100 | |
| | | | | | | 20,351,090 | |
|
Automobile Manufacturers – 2.2% | |
| | |
BMW US Capital LLC | | | | | | | | |
(United States SOFR Compounded Index + 0.53%), 5.86%, 4/1/2024(a)(b) | | | 900,000 | | | | 900,519 | |
| | |
Hyundai Capital America | | | | | | | | |
0.80%, 1/8/2024(b) | | | 1,700,000 | | | | 1,683,077 | |
0.88%, 6/14/2024(b) | | | 1,000,000 | | | | 967,727 | |
| | |
Kia Corp. | | | | | | | | |
2.38%, 2/14/2025(b) | | | 730,000 | | | | 697,204 | |
| | |
Mercedes-Benz Finance North America LLC | | | | | | | | |
0.75%, 3/1/2024(b) | | | 2,350,000 | | | | 2,310,087 | |
(SOFR + 0.93%), 6.26%, 3/30/2025(a)(b) | | | 5,000,000 | | | | 5,032,280 | |
(SOFR + 0.57%), 5.95%, 8/1/2025(a)(b) | | | 7,000,000 | | | | 7,010,266 | |
| | |
Nissan Motor Acceptance Co. LLC | | | | | | | | |
1.13%, 9/16/2024(b) | | | 900,000 | | | | 858,706 | |
| | |
Volkswagen Group of America Finance LLC | | | | | | | | |
0.88%, 11/22/2023(b) | | | 2,000,000 | | | | 1,994,469 | |
(SOFR + 0.95%), 6.30%, 6/7/2024(a)(b) | | | 2,690,000 | | | | 2,695,075 | |
| | | | | | | 24,149,410 | |
|
Automotive Retail – 0.7% | |
| | |
AutoZone, Inc. | | | | | | | | |
3.13%, 4/18/2024 | | | 7,693,000 | | | | 7,590,827 | |
See Accompanying Notes to the Financial Statements.
| | | | |
456 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Biotechnology – 1.5% | |
| | |
AbbVie, Inc. | | | | | | | | |
2.60%, 11/21/2024 | | $ | 7,638,000 | | | $ | 7,380,295 | |
| | |
Amgen, Inc. | | | | | | | | |
3.63%, 5/22/2024 | | | 8,000,000 | | | | 7,900,030 | |
| | |
Gilead Sciences, Inc. | | | | | | | | |
3.70%, 4/1/2024 | | | 1,100,000 | | | | 1,089,954 | |
| | | | | | | 16,370,279 | |
|
Broadcasting – 0.5% | |
| | |
Fox Corp. | | | | | | | | |
4.03%, 1/25/2024 | | | 5,559,000 | | | | 5,531,133 | |
|
Broadline Retail – 0.7% | |
| | |
eBay, Inc. | | | | | | | | |
3.45%, 8/1/2024 | | | 8,100,000 | | | | 7,953,254 | |
|
Building Products – 0.6% | |
| | |
Johnson Controls International plc | | | | | | | | |
3.62%, 7/2/2024(c) | | | 6,769,000 | | | | 6,668,002 | |
|
Cargo Ground Transportation – 0.6% | |
| | |
Ryder System, Inc. | | | | | | | | |
3.65%, 3/18/2024 | | | 7,000,000 | | | | 6,935,832 | |
|
Commodity Chemicals – 1.0% | |
| | |
LyondellBasell Industries NV | | | | | | | | |
5.75%, 4/15/2024 | | | 10,000,000 | | | | 9,978,321 | |
| | |
Westlake Corp. | | | | | | | | |
0.88%, 8/15/2024 | | | 300,000 | | | | 287,752 | |
| | | | | | | 10,266,073 | |
|
Construction Machinery & Heavy Transportation Equipment – 0.2% | |
| | |
Daimler Truck Finance North America LLC | | | | | | | | |
(SOFR + 0.60%), 5.95%, 12/14/2023(a)(b) | | | 2,000,000 | | | | 2,000,247 | |
|
Consumer Finance – 6.0% | |
| | |
AerCap Ireland Capital DAC | | | | | | | | |
2.88%, 8/14/2024 | | | 2,000,000 | | | | 1,943,604 | |
1.65%, 10/29/2024 | | | 4,750,000 | | | | 4,529,346 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Consumer Finance – (continued) | |
| | |
American Express Co. | | | | | | | | |
3.40%, 2/22/2024 | | $ | 2,500,000 | | | $ | 2,480,084 | |
(United States SOFR Compounded Index + 0.72%), 6.10%, 5/3/2024(a) | | | 3,000,000 | | | | 3,002,403 | |
2.50%, 7/30/2024 | | | 2,000,000 | | | | 1,950,896 | |
(SOFR + 0.93%), 6.28%, 3/4/2025(a) | | | 1,914,000 | | | | 1,917,800 | |
| | |
American Honda Finance Corp. | | | | | | | | |
0.55%, 7/12/2024 | | | 2,000,000 | | | | 1,929,499 | |
0.75%, 8/9/2024 | | | 2,000,000 | | | | 1,923,181 | |
2.15%, 9/10/2024 | | | 3,764,000 | | | | 3,650,021 | |
(United States SOFR Compounded Index + 0.79%), 6.12%, 10/3/2025(a) | | | 2,100,000 | | | | 2,102,232 | |
| | |
Capital One Financial Corp. | | | | | | | | |
(SOFR + 0.69%), 6.04%, 12/6/2024(a) | | | 4,122,000 | | | | 4,073,954 | |
(SOFR + 1.35%), 6.72%, 5/9/2025(a) | | | 2,000,000 | | | | 1,988,280 | |
| | |
Caterpillar Financial Services Corp. | | | | | | | | |
(SOFR + 0.52%), 5.87%, 6/13/2025(a) | | | 5,000,000 | | | | 5,009,684 | |
| | |
Ford Motor Credit Co. LLC | | | | | | | | |
4.06%, 11/1/2024 | | | 2,019,000 | | | | 1,965,497 | |
| | |
General Motors Financial Co., Inc. | | | | | | | | |
(SOFR + 0.76%), 6.11%, 3/8/2024(a) | | | 800,000 | | | | 799,304 | |
1.20%, 10/15/2024 | | | 1,500,000 | | | | 1,428,640 | |
3.50%, 11/7/2024 | | | 2,600,000 | | | | 2,529,147 | |
(United States SOFR Compounded Index + 1.30%), 6.63%, 4/7/2025(a) | | | 1,906,000 | | | | 1,908,686 | |
| | |
John Deere Capital Corp. | | | | | | | | |
(SOFR + 0.20%), 5.52%, 10/11/2024(a) | | | 2,500,000 | | | | 2,500,121 | |
(SOFR + 0.56%), 5.90%, 3/7/2025(a) | | | 1,720,000 | | | | 1,724,045 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 457 | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Consumer Finance – (continued) | |
(United States SOFR Compounded Index + 0.79%), 6.13%, 6/8/2026(a) | | $ | 1,300,000 | | | $ | 1,308,883 | |
| | |
Synchrony Financial | | | | | | | | |
4.88%, 6/13/2025 | | | 1,493,000 | | | | 1,415,945 | |
| | |
Toyota Motor Credit Corp. | | | | | | | | |
(SOFR + 0.32%), 5.64%, 1/13/2025(a) | | | 7,000,000 | | | | 6,981,495 | |
(SOFR + 0.65%), 6.00%, 9/11/2025(a) | | | 5,000,000 | | | | 5,016,332 | |
| | | | | | | 64,079,079 | |
|
Consumer Staples Merchandise Retail – 0.4% | |
| | |
Dollar General Corp. | | | | | | | | |
4.25%, 9/20/2024 | | | 3,794,000 | | | | 3,731,481 | |
|
Distillers & Vintners – 0.1% | |
| | |
Constellation Brands, Inc. | | | | | | | | |
3.60%, 5/9/2024 | | | 1,590,000 | | | | 1,569,297 | |
|
Diversified Banks – 24.2% | |
| | |
Australia & New Zealand Banking Group Ltd. | | | | | | | | |
5.38%, 7/3/2025 | | | 4,290,000 | | | | 4,270,095 | |
5.09%, 12/8/2025 | | | 1,505,000 | | | | 1,488,412 | |
| | |
Banco Santander SA | | | | | | | | |
(SOFR + 1.24%), 6.59%, 5/24/2024(a) | | | 5,800,000 | | | | 5,823,787 | |
5.15%, 8/18/2025 | | | 1,400,000 | | | | 1,363,781 | |
| | |
Bank of America Corp. | | | | | | | | |
4.13%, 1/22/2024 | | | 4,000,000 | | | | 3,983,803 | |
Series 2025, (SOFR + 0.66%), 6.04%, 2/4/2025(a) | | | 2,000,000 | | | | 1,995,490 | |
(SOFR + 1.10%), 6.41%, 4/25/2025(a) | | | 2,000,000 | | | | 2,002,813 | |
| | |
Bank of Montreal | | | | | | | | |
2.50%, 6/28/2024 | | | 1,500,000 | | | | 1,466,664 | |
Series H, 4.25%, 9/14/2024 | | | 4,500,000 | | | | 4,427,110 | |
(United States SOFR Compounded Index + 0.95%), 6.29%, 9/25/2025(a) | | | 5,700,000 | | | | 5,708,265 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified Banks – (continued) | |
(United States SOFR Compounded Index + 0.62%), 5.97%, 9/15/2026(a) | | $ | 3,300,000 | | | $ | 3,262,846 | |
| | |
Bank of New Zealand | | | | | | | | |
(SOFR + 0.81%), 6.12%, 1/27/2027(a)(b) | | | 4,000,000 | | | | 3,972,040 | |
| | |
Bank of Nova Scotia (The) | | | | | | | | |
(SOFR + 0.46%), 5.79%, 1/10/2025(a) | | | 4,355,000 | | | | 4,336,322 | |
(United States SOFR Compounded Index + 0.90%), 6.23%, 4/11/2025(a) | | | 2,286,000 | | | | 2,285,451 | |
(United States SOFR Compounded Index + 0.55%), 5.90%, 3/2/2026(a) | | | 5,000,000 | | | | 4,950,335 | |
| | |
Banque Federative du Credit Mutuel SA | | | | | | | | |
0.65%, 2/27/2024(b) | | | 5,000,000 | | | | 4,915,318 | |
| | |
BNP Paribas SA | | | | | | | | |
4.25%, 10/15/2024 | | | 1,000,000 | | | | 975,496 | |
| | |
Canadian Imperial Bank of Commerce | | | | | | | | |
3.10%, 4/2/2024 | | | 3,225,000 | | | | 3,184,694 | |
(SOFR + 0.94%), 6.27%, 4/7/2025(a) | | | 7,674,000 | | | | 7,691,863 | |
| | |
Citibank NA | | | | | | | | |
3.65%, 1/23/2024 | | | 540,000 | | | | 537,122 | |
| | |
Citigroup, Inc. | | | | | | | | |
(SOFR + 0.69%), 6.00%, 10/30/2024(a) | | | 3,500,000 | | | | 3,488,415 | |
(SOFR + 0.67%), 6.05%, 5/1/2025(a) | | | 900,000 | | | | 896,884 | |
(SOFR + 1.37%), 6.74%, 5/24/2025(a) | | | 1,300,000 | | | | 1,303,401 | |
(SOFR + 0.69%), 6.01%, 1/25/2026(a) | | | 2,400,000 | | | | 2,378,780 | |
| |
Commonwealth Bank of Australia | | | | | |
(SOFR + 0.74%), 6.09%, 3/14/2025(a)(b) | | | 5,000,000 | | | | 5,014,550 | |
(SOFR + 0.40%), 5.73%, 7/7/2025(a)(b) | | | 1,800,000 | | | | 1,794,249 | |
See Accompanying Notes to the Financial Statements.
| | | | |
458 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Diversified Banks – (continued) | |
(SOFR + 0.52%), 5.87%, 6/15/2026(a)(b) | | $ | 1,900,000 | | | $ | 1,893,426 | |
| | |
Cooperatieve Rabobank UA | | | | | | | | |
(United States SOFR Compounded Index + 0.30%), 5.63%, 1/12/2024(a) | | | 7,000,000 | | | | 6,999,510 | |
(United States SOFR Compounded Index + 0.38%), 5.71%, 1/10/2025(a) | | | 1,600,000 | | | | 1,597,127 | |
(United States SOFR Compounded Index + 0.90%), 6.23%, 10/5/2026(a) | | | 5,000,000 | | | | 4,990,748 | |
| | |
Credit Agricole SA | | | | | | | | |
3.25%, 10/4/2024(b) | | | 3,000,000 | | | | 2,923,702 | |
| | |
Danske Bank A/S | | | | | | | | |
6.47%, 1/9/2026(b)(d) | | | 1,280,000 | | | | 1,274,726 | |
| | |
Fifth Third Bank NA | | | | | | | | |
5.85%, 10/27/2025(d) | | | 8,500,000 | | | | 8,280,511 | |
| | |
HSBC Holdings plc | | | | | | | | |
(SOFR + 0.58%), 5.95%, 11/22/2024(a) | | | 3,000,000 | | | | 2,999,939 | |
(SOFR + 1.43%), 6.77%, 3/10/2026(a) | | | 7,000,000 | | | | 7,017,780 | |
| | |
ING Groep NV | | | | | | | | |
(United States SOFR Compounded Index + 1.01%), 6.33%, 4/1/2027(a) | | | 3,800,000 | | | | 3,742,975 | |
| | |
JPMorgan Chase & Co. | | | | | | | | |
4.02%, 12/5/2024(d) | | | 2,500,000 | | | | 2,493,717 | |
0.77%, 8/9/2025(d) | | | 1,000,000 | | | | 955,262 | |
(SOFR + 0.60%), 5.95%, 12/10/2025(a) | | | 1,000,000 | | | | 995,031 | |
(SOFR + 0.92%), 6.28%, 2/24/2026(a) | | | 7,000,000 | | | | 6,998,538 | |
(SOFR + 0.77%), 6.11%, 9/22/2027(a) | | | 2,500,000 | | | | 2,462,493 | |
| | |
Lloyds Banking Group plc | | | | | | | | |
3.90%, 3/12/2024 | | | 1,000,000 | | | | 991,754 | |
4.72%, 8/11/2026(d) | | | 2,300,000 | | | | 2,229,370 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified Banks – (continued) | |
| | |
Mitsubishi UFJ Financial Group, Inc. | | | | | | | | |
4.79%, 7/18/2025(d) | | $ | 2,000,000 | | | $ | 1,977,250 | |
(SOFR + 0.94%), 6.30%, 2/20/2026(a) | | | 5,000,000 | | | | 5,001,855 | |
(SOFR + 1.44%), 6.75%, 4/17/2026(a) | | | 2,500,000 | | | | 2,516,448 | |
| | |
Morgan Stanley Bank NA | | | | | | | | |
5.48%, 7/16/2025 | | | 3,000,000 | | | | 2,986,850 | |
| | |
National Australia Bank Ltd. | | | | | | | | |
(SOFR + 0.86%), 6.21%, 6/9/2025(a)(b) | | | 5,200,000 | | | | 5,217,680 | |
(SOFR + 0.65%), 5.97%, 1/12/2027(a)(b) | | | 4,000,000 | | | | 3,973,056 | |
| | |
National Bank of Canada | | | | | | | | |
0.75%, 8/6/2024 | | | 900,000 | | | | 864,659 | |
| | |
NatWest Markets plc | | | | | | | | |
(SOFR + 0.53%), 5.90%, 8/12/2024(a)(b) | | | 600,000 | | | | 598,758 | |
| | |
Nordea Bank Abp | | | | | | | | |
(SOFR + 0.96%), 6.31%, 6/6/2025(a)(b) | | | 2,000,000 | | | | 2,007,863 | |
| | |
PNC Financial Services Group, Inc. (The) | | | | | | | | |
3.50%, 1/23/2024 | | | 6,500,000 | | | | 6,462,849 | |
| | |
Royal Bank of Canada | | | | | | | | |
3.97%, 7/26/2024 | | | 5,000,000 | | | | 4,933,173 | |
(United States SOFR Compounded Index + 0.44%), 5.76%, 1/21/2025(a) | | | 3,000,000 | | | | 2,987,214 | |
4.95%, 4/25/2025 | | | 3,000,000 | | | | 2,955,205 | |
(United States SOFR Compounded Index + 0.53%), 5.84%, 1/20/2026(a) | | | 2,750,000 | | | | 2,719,854 | |
(United States SOFR Compounded Index + 0.57%), 5.88%, 4/27/2026(a) | | | 2,000,000 | | | | 1,980,986 | |
| | |
Skandinaviska Enskilda Banken AB | | | | | | | | |
0.65%, 9/9/2024(b) | | | 500,000 | | | | 477,585 | |
(SOFR + 0.96%), 6.31%, 6/9/2025(a)(b) | | | 1,000,000 | | | | 1,002,230 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 459 | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Diversified Banks – (continued) | |
| | |
Societe Generale SA | | | | | | | | |
3.88%, 3/28/2024(b) | | $ | 1,665,000 | | | $ | 1,648,793 | |
2.63%, 10/16/2024(b) | | | 1,000,000 | | | | 965,137 | |
| | |
Standard Chartered plc | | | | | | | | |
6.17%, 1/9/2027(b)(d) | | | 2,100,000 | | | | 2,085,106 | |
| | |
Sumitomo Mitsui Financial Group, Inc. | | | | | | | | |
0.51%, 1/12/2024 | | | 300,000 | | | | 296,791 | |
2.70%, 7/16/2024 | | | 7,000,000 | | | | 6,840,325 | |
(SOFR + 0.88%), 6.19%, 1/14/2027(a) | | | 1,480,000 | | | | 1,475,337 | |
| | |
Sumitomo Mitsui Trust Bank Ltd. | | | | | | | | |
0.85%, 3/25/2024(b) | | | 400,000 | | | | 391,929 | |
| | |
Svenska Handelsbanken AB | | | | | | | | |
3.90%, 11/20/2023 | | | 1,500,000 | | | | 1,498,264 | |
(SOFR + 0.91%), 6.26%, 6/10/2025(a)(b) | | | 7,000,000 | | | | 7,018,311 | |
| | |
Swedbank AB | | | | | | | | |
(United States SOFR Compounded Index + 1.38%), 6.73%, 6/15/2026(a)(b) | | | 3,000,000 | | | | 3,027,661 | |
| | |
Toronto-Dominion Bank (The) | | | | | | | | |
2.65%, 6/12/2024 | | | 2,000,000 | | | | 1,958,508 | |
4.29%, 9/13/2024 | | | 3,000,000 | | | | 2,957,502 | |
(SOFR + 0.41%), 5.74%, 1/10/2025(a) | | | 2,777,000 | | | | 2,762,072 | |
(SOFR + 1.02%), 6.37%, 6/6/2025(a) | | | 3,000,000 | | | | 3,004,484 | |
(SOFR + 0.59%), 5.94%, 9/10/2026(a) | | | 2,000,000 | | | | 1,971,872 | |
| | |
US Bancorp | | | | | | | | |
3.70%, 1/30/2024 | | | 3,000,000 | | | | 2,983,772 | |
2.40%, 7/30/2024 | | | 2,913,000 | | | | 2,831,611 | |
| | |
Wells Fargo & Co. | | | | | | | | |
(SOFR + 1.32%), 6.63%, 4/25/2026(a) | | | 5,600,000 | | | | 5,628,017 | |
| | |
Wells Fargo Bank NA | | | | | | | | |
5.55%, 8/1/2025 | | | 1,250,000 | | | | 1,245,542 | |
(SOFR + 0.80%), 6.18%, 8/1/2025(a) | | | 3,125,000 | | | | 3,127,136 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Diversified Banks – (continued) | |
| | |
Westpac Banking Corp. | | | | | | | | |
3.30%, 2/26/2024 | | $ | 2,200,000 | | | $ | 2,181,719 | |
5.35%, 10/18/2024 | | | 3,000,000 | | | | 2,988,425 | |
(SOFR + 0.30%), 5.66%, 11/18/2024(a) | | | 2,500,000 | | | | 2,495,116 | |
(SOFR + 1.00%), 6.36%, 8/26/2025(a) | | | 5,000,000 | | | | 5,034,700 | |
(SOFR + 0.52%), 5.87%, 6/3/2026(a) | | | 2,568,000 | | | | 2,554,413 | |
| | | | | | | 260,000,653 | |
|
Diversified Capital Markets – 2.0% | |
| | |
Credit Suisse AG | | | | | | | | |
3.63%, 9/9/2024 | | | 1,500,000 | | | | 1,461,930 | |
7.95%, 1/9/2025 | | | 720,000 | | | | 730,269 | |
| | |
Deutsche Bank AG | | | | | | | | |
Series E, 0.96%, 11/8/2023 | | | 5,400,000 | | | | 5,394,531 | |
0.90%, 5/28/2024 | | | 1,100,000 | | | | 1,068,644 | |
| | |
Macquarie Group Ltd. | | | | | | | | |
(SOFR + 0.71%), 6.03%, 10/14/2025(a)(b) | | | 5,000,000 | | | | 4,968,099 | |
| | |
UBS AG | | | | | | | | |
0.70%, 8/9/2024(b) | | | 200,000 | | | | 191,917 | |
| | |
UBS Group AG | | | | | | | | |
(SOFR + 1.58%), 6.95%, 5/12/2026(a)(b) | | | 6,000,000 | | | | 6,036,120 | |
6.37%, 7/15/2026(b)(d) | | | 1,900,000 | | | | 1,888,432 | |
| | | | | | | 21,739,942 | |
|
Diversified Financial Services – 0.3% | |
| | |
Corebridge Financial, Inc. | | | | | | | | |
3.50%, 4/4/2025 | | | 2,300,000 | | | | 2,211,346 | |
| | |
Jackson Financial, Inc. | | | | | | | | |
1.13%, 11/22/2023 | | | 950,000 | | | | 947,293 | |
| | | | | | | 3,158,639 | |
|
Drug Retail – 0.2% | |
| | |
Walgreens Boots Alliance, Inc. | | | | | | | | |
0.95%, 11/17/2023 | | | 1,770,000 | | | | 1,765,908 | |
|
Electric Utilities – 1.2% | |
| | |
Entergy Louisiana LLC | | | | | | | | |
0.62%, 11/17/2023 | | | 846,000 | | | | 843,950 | |
See Accompanying Notes to the Financial Statements.
| | | | |
460 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Electric Utilities – (continued) | |
| | |
Eversource Energy | | | | | | | | |
Series N, 3.80%, 12/1/2023 | | $ | 3,000,000 | | | $ | 2,994,724 | |
| | |
Florida Power & Light Co. | | | | | | | | |
(United States SOFR Compounded Index + 0.38%), 5.70%, 1/12/2024(a) | | | 4,400,000 | | | | 4,400,056 | |
| | |
Mississippi Power Co. | | | | | | | | |
Series A, (SOFR + 0.30%), 5.64%, 6/28/2024(a) | | | 950,000 | | | | 947,265 | |
| | |
NextEra Energy Capital Holdings, Inc. | | | | | | | | |
2.94%, 3/21/2024 | | | 2,000,000 | | | | 1,975,936 | |
| | |
Southern Co. (The) | | | | | | | | |
Series 21-A, 0.60%, 2/26/2024 | | | 1,840,000 | | | | 1,809,229 | |
| | | | | | | 12,971,160 | |
|
Electronic Components – 0.1% | |
| | |
Tyco Electronics Group SA | | | | | | | | |
3.45%, 8/1/2024 | | | 1,347,000 | | | | 1,324,568 | |
|
Environmental & Facilities Services – 0.6% | |
| | |
Republic Services, Inc. | | | | | | | | |
2.50%, 8/15/2024 | | | 7,000,000 | | | | 6,809,685 | |
|
Fertilizers & Agricultural Chemicals – 0.6% | |
| | |
Nutrien Ltd. | | | | | | | | |
5.90%, 11/7/2024 | | | 6,965,000 | | | | 6,950,011 | |
|
Financial Exchanges & Data – 0.2% | |
| | |
Nasdaq, Inc. | | | | | | | | |
5.65%, 6/28/2025 | | | 2,500,000 | | | | 2,490,921 | |
|
Food Retail – 1.0% | |
| | |
7-Eleven, Inc. | | | | | | | | |
0.80%, 2/10/2024(b) | | | 5,000,000 | | | | 4,925,696 | |
| | |
Kroger Co. (The) | | | | | | | | |
4.00%, 2/1/2024 | | | 6,200,000 | | | | 6,171,140 | |
| | | | | | | 11,096,836 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Health Care Distributors – 0.5% | |
| | |
McKesson Corp. | | | | | | | | |
3.80%, 3/15/2024 | | $ | 5,000,000 | | | $ | 4,959,042 | |
|
Health Care Equipment – 2.9% | |
| | |
Baxter International, Inc. | | | | | | | | |
0.87%, 12/1/2023 | | | 6,800,000 | | | | 6,771,893 | |
(United States SOFR Compounded Index + 0.44%), 5.80%, 11/29/2024(a) | | | 1,435,000 | | | | 1,425,846 | |
| | |
Becton Dickinson & Co. | | | | | | | | |
3.36%, 6/6/2024 | | | 6,800,000 | | | | 6,692,065 | |
| | |
Boston Scientific Corp. | | | | | | | | |
3.45%, 3/1/2024 | | | 6,127,000 | | | | 6,072,964 | |
| | |
GE HealthCare Technologies, Inc. | | | | | | | | |
5.55%, 11/15/2024 | | | 3,000,000 | | | | 2,985,615 | |
| | |
Stryker Corp. | | | | | | | | |
0.60%, 12/1/2023 | | | 6,910,000 | | | | 6,878,993 | |
| | |
Zimmer Biomet Holdings, Inc. | | | | | | | | |
1.45%, 11/22/2024 | | | 650,000 | | | | 618,966 | |
| | | | | | | 31,446,342 | |
|
Health Care Facilities – 0.0%(e) | |
| | |
HCA, Inc. | | | | | | | | |
5.00%, 3/15/2024 | | | 400,000 | | | | 398,419 | |
|
Health Care Services – 1.1% | |
| | |
Cigna Group (The) | | | | | | | | |
0.61%, 3/15/2024 | | | 2,400,000 | | | | 2,352,630 | |
3.50%, 6/15/2024 | | | 5,078,000 | | | | 4,999,874 | |
| | |
Laboratory Corp. of America Holdings | | | | | | | | |
3.25%, 9/1/2024 | | | 5,000,000 | | | | 4,887,880 | |
| | | | | | | 12,240,384 | |
|
Homebuilding – 0.4% | |
| | |
Lennar Corp. | | | | | | | | |
4.88%, 12/15/2023 | | | 3,940,000 | | | | 3,936,643 | |
|
Household Products – 0.1% | |
| | |
Colgate-Palmolive Co. | | | | | | | | |
3.10%, 8/15/2025 | | | 1,480,000 | | | | 1,426,185 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 461 | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Industrial Conglomerates – 0.6% | |
| | |
3M Co. | | | | | | | | |
3.25%, 2/14/2024 | | $ | 3,062,000 | | | $ | 3,037,961 | |
| | |
General Electric Co. | | | | | | | | |
Series A, (CME Term SOFR 3 Month + 0.56%), 5.96%, 5/13/2024(a) | | | 3,000,000 | | | | 2,990,594 | |
| | | | | | | 6,028,555 | |
|
Industrial Machinery & Supplies & Components – 1.2% | |
| | |
Illinois Tool Works, Inc. | | | | | | | | |
3.50%, 3/1/2024 | | | 4,330,000 | | | | 4,297,467 | |
| | |
Parker-Hannifin Corp. | | | | | | | | |
3.65%, 6/15/2024 | | | 7,000,000 | | | | 6,897,412 | |
| | |
Stanley Black & Decker, Inc. | | | | | | | | |
6.27%, 3/6/2026 | | | 2,020,000 | | | | 2,021,168 | |
| | | | | | | 13,216,047 | |
|
Integrated Oil & Gas – 1.0% | |
| | |
ConocoPhillips Co. | | | | | | | | |
2.13%, 3/8/2024 | | | 5,000,000 | | | | 4,935,499 | |
| | |
Saudi Arabian Oil Co. | | | | | | | | |
1.25%, 11/24/2023(b) | | | 200,000 | | | | 199,334 | |
| | |
TotalEnergies Capital International SA | | | | | | | | |
3.75%, 4/10/2024 | | | 5,600,000 | | | | 5,553,409 | |
| | | | | | | 10,688,242 | |
|
Integrated Telecommunication Services – 2.3% | |
| | |
AT&T, Inc. | | | | | | | | |
0.90%, 3/25/2024 | | | 3,271,000 | | | | 3,205,314 | |
(CME Term SOFR 3 Month + 1.44%), 6.85%, 6/12/2024(a) | | | 3,550,000 | | | | 3,567,616 | |
| | |
Bell Canada (The) | | | | | | | | |
Series US-3, 0.75%, 3/17/2024 | | | 5,050,000 | | | | 4,949,281 | |
| | |
British Telecommunications plc | | | | | | | | |
4.50%, 12/4/2023 | | | 5,500,000 | | | | 5,491,191 | |
| | |
Verizon Communications, Inc. | | | | | | | | |
0.75%, 3/22/2024 | | | 5,112,000 | | | | 5,011,311 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Integrated Telecommunication Services – (continued) | |
(United States SOFR Compounded Index + 0.79%), 6.13%, 3/20/2026(a) | | $ | 2,790,000 | | | $ | 2,803,954 | |
| | | | | | | 25,028,667 | |
|
Interactive Home Entertainment – 0.7% | |
| | |
Take-Two Interactive Software, Inc. | | | | | | | | |
3.30%, 3/28/2024 | | | 6,939,000 | | | | 6,864,687 | |
3.55%, 4/14/2025 | | | 240,000 | | | | 231,888 | |
| | | | | | | 7,096,575 | |
|
Investment Banking & Brokerage – 2.8% | |
| | |
Charles Schwab Corp. (The) | | | | | | | | |
(United States SOFR Compounded Index + 0.50%), 5.84%, 3/18/2024(a) | | | 1,390,000 | | | | 1,388,206 | |
(United States SOFR Compounded Index + 0.52%), 5.89%, 5/13/2026(a) | | | 1,000,000 | | | | 979,033 | |
(United States SOFR Compounded Index + 1.05%), 6.40%, 3/3/2027(a) | | | 7,000,000 | | | | 6,906,046 | |
| | |
Goldman Sachs Group, Inc. (The) | | | | | | | | |
3.00%, 3/15/2024 | | | 2,500,000 | | | | 2,472,544 | |
(SOFR + 0.51%), 5.85%, 9/10/2024(a) | | | 2,600,000 | | | | 2,593,245 | |
5.70%, 11/1/2024 | | | 3,000,000 | | | | 2,988,696 | |
3.50%, 4/1/2025 | | | 1,500,000 | | | | 1,443,652 | |
| | |
Morgan Stanley | | | | | | | | |
(SOFR + 0.46%), 5.77%, 1/25/2024(a) | | | 2,200,000 | | | | 2,199,978 | |
(SOFR + 1.17%), 6.49%, 4/17/2025(a) | | | 1,500,000 | | | | 1,502,322 | |
1.16%, 10/21/2025(d) | | | 500,000 | | | | 473,027 | |
(SOFR + 0.95%), 6.32%, 2/18/2026(a) | | | 7,000,000 | | | | 6,987,371 | |
| | | | | | | 29,934,120 | |
See Accompanying Notes to the Financial Statements.
| | | | |
462 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
IT Consulting & Other Services – 0.9% | |
| | |
International Business Machines Corp. | | | | | | | | |
3.63%, 2/12/2024 | | $ | 9,500,000 | | | $ | 9,442,468 | |
3.00%, 5/15/2024 | | | 500,000 | | | | 492,710 | |
| | | | | | | 9,935,178 | |
|
Life & Health Insurance – 0.5% | |
| | |
Athene Global Funding | | | | | | | | |
(ICE LIBOR USD 3 Month + 0.73%), 6.40%, 1/8/2024(a)(b) | | | 1,000,000 | | | | 999,062 | |
| | |
MetLife, Inc. | | | | | | | | |
3.60%, 4/10/2024 | | | 3,500,000 | | | | 3,464,172 | |
| | |
Security Benefit Global Funding | | | | | | | | |
1.25%, 5/17/2024(b) | | | 650,000 | | | | 630,024 | |
| | | | | | | 5,093,258 | |
|
Life Sciences Tools & Services – 0.7% | |
| | |
Thermo Fisher Scientific, Inc. | | | | | | | | |
1.22%, 10/18/2024 | | | 8,090,000 | | | | 7,732,805 | |
|
Managed Health Care – 1.1% | |
| | |
Elevance Health, Inc. | | | | | | | | |
3.50%, 8/15/2024 | | | 5,100,000 | | | | 5,000,041 | |
| | |
Humana, Inc. | | | | | | | | |
3.85%, 10/1/2024 | | | 5,000,000 | | | | 4,902,379 | |
| | |
UnitedHealth Group, Inc. | | | | | | | | |
0.55%, 5/15/2024 | | | 1,580,000 | | | | 1,538,314 | |
| | | | | | | 11,440,734 | |
|
Movies & Entertainment – 0.5% | |
| | |
Netflix, Inc. | | | | | | | | |
3.63%, 6/15/2025(b) | | | 5,000,000 | | | | 4,820,408 | |
|
Multi-line Insurance – 0.2% | |
| | |
New York Life Global Funding | | | | | | | | |
(United States SOFR Compounded Index + 0.33%), 5.65%, 1/14/2025(a)(b) | | | 2,000,000 | | | | 1,994,269 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Multi-Utilities – 0.6% | |
| | |
Black Hills Corp. | | | | | | | | |
1.04%, 8/23/2024 | | $ | 960,000 | | | $ | 920,240 | |
| | |
CenterPoint Energy, Inc. | | | | | | | | |
(United States SOFR Compounded Index + 0.65%), 6.02%, 5/13/2024(a) | | | 760,000 | | | | 759,737 | |
| | |
Consolidated Edison, Inc. | | | | | | | | |
Series A, 0.65%, 12/1/2023 | | | 3,600,000 | | | | 3,585,219 | |
| | |
DTE Energy Co. | | | | | | | | |
4.22%, 11/1/2024(c) | | | 1,700,000 | | | | 1,666,833 | |
| | | | | | | 6,932,029 | |
|
Office REITs – 0.1% | |
| | |
Boston Properties LP | | | | | | | | |
REIT, 3.80%, 2/1/2024 | | | 1,000,000 | | | | 992,842 | |
|
Oil & Gas Equipment & Services – 0.8% | |
| | |
Baker Hughes Holdings LLC | | | | | | | | |
1.23%, 12/15/2023 | | | 4,255,000 | | | | 4,231,909 | |
| | |
Schlumberger Investment SA | | | | | | | | |
3.65%, 12/1/2023 | | | 4,546,000 | | | | 4,537,411 | |
| | | | | | | 8,769,320 | |
|
Oil & Gas Refining & Marketing – 0.5% | |
| | |
Phillips 66 | | | | | | | | |
0.90%, 2/15/2024 | | | 5,000,000 | | | | 4,922,481 | |
|
Oil & Gas Storage & Transportation – 1.9% | |
| | |
Enbridge, Inc. | | | | | | | | |
(United States SOFR Compounded Index + 0.63%), 6.00%, 2/16/2024(a) | | | 4,700,000 | | | | 4,703,087 | |
| | |
Enterprise Products Operating LLC | | | | | | | | |
5.05%, 1/10/2026 | | | 720,000 | | | | 711,465 | |
| | |
Kinder Morgan Energy Partners LP | | | | | | | | |
4.25%, 9/1/2024 | | | 6,870,000 | | | | 6,758,845 | |
| | |
Kinder Morgan, Inc. | | | | | | | | |
5.63%, 11/15/2023(b) | | | 1,150,000 | | | | 1,149,591 | |
| | |
TransCanada PipeLines Ltd. | | | | | | | | |
1.00%, 10/12/2024 | | | 7,010,000 | | | | 6,673,997 | |
| | | | | | | 19,996,985 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 463 | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Packaged Foods & Meats – 3.5% | |
| | |
Danone SA | | | | | | | | |
2.59%, 11/2/2023(b) | | $ | 7,700,000 | | | $ | 7,700,000 | |
| | |
General Mills, Inc. | | | | | | | | |
3.65%, 2/15/2024 | | | 6,000,000 | | | | 5,962,374 | |
| | |
Hormel Foods Corp. | | | | | | | | |
0.65%, 6/3/2024 | | | 2,780,000 | | | | 2,696,151 | |
| | |
Kellogg Co. | | | | | | | | |
2.65%, 12/1/2023 | | | 2,000,000 | | | | 1,994,809 | |
| | |
McCormick & Co., Inc. | | | | | | | | |
3.15%, 8/15/2024 | | | 5,000,000 | | | | 4,889,987 | |
0.90%, 2/15/2026 | | | 620,000 | | | | 554,541 | |
| | |
Mondelez International, Inc. | | | | | | | | |
2.13%, 3/17/2024 | | | 5,400,000 | | | | 5,322,416 | |
| | |
Tyson Foods, Inc. | | | | | | | | |
3.95%, 8/15/2024 | | | 8,250,000 | | | | 8,116,868 | |
| | | | | | | 37,237,146 | |
|
Paper & Plastic Packaging Products & Materials – 1.1% | |
| | |
Avery Dennison Corp. | | | | | | | | |
0.85%, 8/15/2024 | | | 8,190,000 | | | | 7,860,455 | |
| | |
Graphic Packaging International LLC | | | | | | | | |
0.82%, 4/15/2024(b) | | | 4,000,000 | | | | 3,898,842 | |
| | | | | | | 11,759,297 | |
|
Paper Products – 0.2% | |
| | |
Georgia-Pacific LLC | | | | | | | | |
0.63%, 5/15/2024(b) | | | 2,200,000 | | | | 2,138,007 | |
|
Personal Care Products – 0.2% | |
| | |
Kenvue, Inc. | | | | | | | | |
5.50%, 3/22/2025 | | | 2,305,000 | | | | 2,301,253 | |
|
Pharmaceuticals – 0.5% | |
| | |
Bayer US Finance II LLC | | | | | | | | |
3.88%, 12/15/2023(b) | | | 5,000,000 | | | | 4,986,251 | |
| | |
Bristol-Myers Squibb Co. | | | | | | | | |
0.54%, 11/13/2023 | | | 700,000 | | | | 698,900 | |
| | | | | | | 5,685,151 | |
|
Rail Transportation – 1.5% | |
| | |
Burlington Northern Santa Fe LLC | | | | | | | | |
3.75%, 4/1/2024 | | | 5,000,000 | | | | 4,956,884 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Rail Transportation – (continued) | |
| | |
Canadian Pacific Railway Co. | | | | | | | | |
1.35%, 12/2/2024 | | $ | 5,910,000 | | | $ | 5,627,914 | |
| | |
CSX Corp. | | | | | | | | |
3.40%, 8/1/2024 | | | 5,350,000 | | | | 5,252,196 | |
| | | | | | | 15,836,994 | |
|
Regional Banks – 1.0% | |
| | |
ANZ New Zealand Int’l Ltd. | | | | | | | | |
(SOFR + 0.60%), 5.97%, 2/18/2025(a)(b) | | | 1,450,000 | | | | 1,448,898 | |
| | |
Bank of America NA | | | | | | | | |
(SOFR + 0.78%), 6.15%, 8/18/2025(a) | | | 3,850,000 | | | | 3,849,772 | |
| | |
KeyBank NA | | | | | | | | |
(United States SOFR Compounded Index + 0.32%), 5.67%, 6/14/2024(a) | | | 2,000,000 | | | | 1,955,651 | |
| | |
Truist Financial Corp. | | | | | | | | |
(SOFR + 0.40%), 5.75%, 6/9/2025(a) | | | 3,750,000 | | | | 3,669,858 | |
| | | | | | | 10,924,179 | |
|
Restaurants – 0.2% | |
| | |
Starbucks Corp. | | | | | | | | |
(United States SOFR Compounded Index + 0.42%), 5.79%, 2/14/2024(a) | | | 2,370,000 | | | | 2,370,032 | |
|
Self-Storage REITs – 0.6% | |
| | |
Public Storage Operating Co. | | | | | | | | |
REIT, (SOFR + 0.47%), 5.79%, 4/23/2024(a) | | | 4,000,000 | | | | 3,999,316 | |
REIT, (United States SOFR Compounded Index + 0.60%), 5.91%, 7/25/2025(a) | | | 1,990,000 | | | | 1,992,108 | |
| | | | | | | 5,991,424 | |
|
Semiconductors – 0.6% | |
| | |
Analog Devices, Inc. | | | | | | | | |
(United States SOFR Compounded Index + 0.25%), 5.58%, 10/1/2024(a) | | | 610,000 | | | | 609,744 | |
See Accompanying Notes to the Financial Statements.
| | | | |
464 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
CORPORATE BONDS – (continued) | |
|
Semiconductors – (continued) | |
| | |
Microchip Technology, Inc. | | | | | | | | |
0.97%, 2/15/2024 | | $ | 5,307,000 | | | $ | 5,225,179 | |
0.98%, 9/1/2024 | | | 870,000 | | | | 833,619 | |
| | | | | | | 6,668,542 | |
|
Soft Drinks & Non-alcoholic Beverages – 0.7% | |
| | |
Keurig Dr Pepper, Inc. | | | | | | | | |
3.13%, 12/15/2023 | | | 4,000,000 | | | | 3,985,654 | |
0.75%, 3/15/2024 | | | 3,500,000 | | | | 3,432,382 | |
| | | | | | | 7,418,036 | |
|
Specialized Finance – 1.0% | |
| | |
Element Fleet Management Corp. | | | | | | | | |
1.60%, 4/6/2024(b) | | | 5,500,000 | | | | 5,381,729 | |
6.27%, 6/26/2026(b) | | | 2,820,000 | | | | 2,804,313 | |
| | |
NTT Finance Corp. | | | | | | | | |
0.58%, 3/1/2024(b) | | | 2,650,000 | | | | 2,603,090 | |
| | | | | | | 10,789,132 | |
|
Specialty Chemicals – 0.9% | |
| | |
Ecolab, Inc. | | | | | | | | |
0.90%, 12/15/2023 | | | 2,525,000 | | | | 2,509,627 | |
| | |
Sherwin-Williams Co. (The) | | | | | | | | |
4.05%, 8/8/2024 | | | 7,400,000 | | | | 7,289,872 | |
| | | | | | | 9,799,499 | |
|
Systems Software – 0.7% | |
| | |
Oracle Corp. | | | | | | | | |
2.95%, 11/15/2024 | | | 7,980,000 | | | | 7,739,077 | |
|
Technology Hardware, Storage & Peripherals – 0.3% | |
| | |
Hewlett Packard Enterprise Co. | | | | | | | | |
5.90%, 10/1/2024 | | | 3,200,000 | | | | 3,194,228 | |
|
Trading Companies & Distributors – 0.6% | |
| | |
Air Lease Corp. | | | | | | | | |
4.25%, 2/1/2024 | | | 1,000,000 | | | | 994,745 | |
0.80%, 8/18/2024 | | | 980,000 | | | | 937,106 | |
4.25%, 9/15/2024 | | | 5,000,000 | | | | 4,913,298 | |
| | | | | | | 6,845,149 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
Transaction & Payment Processing Services – 0.6% | |
| | |
Fidelity National Information Services, Inc. | | | | | | | | |
0.60%, 3/1/2024 | | $ | 4,110,000 | | | $ | 4,035,444 | |
| | |
Fiserv, Inc. | | | | | | | | |
2.75%, 7/1/2024 | | | 2,000,000 | | | | 1,956,640 | |
| | |
Global Payments, Inc. | | | | | | | | |
1.50%, 11/15/2024 | | | 240,000 | | | | 228,361 | |
| | | | | | | 6,220,445 | |
|
Wireless Telecommunication Services – 0.4% | |
| | |
Sprint LLC | | | | | | | | |
7.13%, 6/15/2024 | | | 4,000,000 | | | | 4,020,264 | |
Total Corporate Bonds (Cost $938,970,908) | | | | 935,554,822 | |
| | |
| | | | | | | | |
|
ASSET-BACKED SECURITIES – 5.3% | |
| | |
BMW Vehicle Lease Trust | | | | | | | | |
Series 2021-2, Class A3, 0.33%, 12/26/2024 | | | 324,803 | | | | 323,661 | |
Series 2023-1, Class A2, 5.27%, 2/25/2025 | | | 354,855 | | | | 354,125 | |
Series 2022-1, Class A3, 1.10%, 3/25/2025 | | | 148,839 | | | | 147,418 | |
| | |
Capital One Multi-Asset Execution Trust | | | | | | | | |
Series 2021-A3, Class A3, 1.04%, 11/15/2026 | | | 2,900,000 | | | | 2,759,853 | |
Series 2022-A3, Class A, 4.95%, 10/15/2027 | | | 1,882,000 | | | | 1,857,181 | |
| | |
Carmax Auto Owner Trust | | | | | | | | |
Series 2022-3, Class A2A, 3.81%, 9/15/2025 | | | 549,194 | | | | 546,292 | |
| | |
Chase Issuance Trust | | | | | | | | |
Series 2023-A1, Class A, 5.16%, 9/15/2028 | | | 1,900,000 | | | | 1,880,724 | |
| | |
Dell Equipment Finance Trust | | | | | | | | |
Series 2023-1, Class A2, 5.65%, 9/22/2028(b) | | | 2,000,000 | | | | 1,992,787 | |
| | |
Ford Credit Auto Lease Trust | | | | | | | | |
Series 2022-A, Class A3, 3.23%, 5/15/2025 | | | 823,595 | | | | 817,786 | |
| | |
Ford Credit Auto Owner Trust | | | | | | | | |
Series 2022-C, Class A2A, 4.52%, 4/15/2025 | | | 1,339,623 | | | | 1,335,726 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 465 | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
ASSET-BACKED SECURITIES – (continued) | |
Series 2022-D, Class A2A, 5.37%, 8/15/2025 | | $ | 614,720 | | | $ | 613,472 | |
Series 2023-A, Class A2A, 5.14%, 3/15/2026 | | | 522,830 | | | | 520,315 | |
Series 2023-B, Class A2A, 5.57%, 6/15/2026 | | | 1,200,000 | | | | 1,195,656 | |
| | |
GM Financial Automobile Leasing Trust | | | | | | | | |
Series 2022-3, Class A2A, 4.01%, 10/21/2024 | | | 596,846 | | | | 595,399 | |
Series 2022-2, Class A3, 3.42%, 6/20/2025 | | | 6,000,000 | | | | 5,937,141 | |
| | |
GM Financial Consumer Automobile Receivables Trust | | | | | | | | |
Series 2022-3, Class A2A, 3.50%, 9/16/2025 | | | 769,067 | | | | 764,425 | |
Series 2023-1, Class A2A, 5.19%, 3/16/2026 | | | 634,095 | | | | 631,476 | |
Series 2021-2, Class A3, 0.51%, 4/16/2026 | | | 731,719 | | | | 709,701 | |
Series 2021-3, Class A3, 0.48%, 6/16/2026 | | | 955,357 | | | | 922,884 | |
Series 2023-3, Class A2A, 5.74%, 9/16/2026 | | | 400,000 | | | | 399,408 | |
Series 2022-1, Class A3, 1.26%, 11/16/2026 | | | 2,060,582 | | | | 1,983,619 | |
| | |
Honda Auto Receivables Owner Trust | | | | | | | | |
Series 2022-2, Class A2, 3.81%, 3/18/2025 | | | 646,544 | | | | 642,970 | |
Series 2023-3, Class A2, 5.71%, 3/18/2026 | | | 3,400,000 | | | | 3,391,874 | |
| | |
Hyundai Auto Receivables Trust | | | | | | | | |
Series 2022-A, Class A2A, 1.81%, 2/18/2025 | | | 109,892 | | | | 109,595 | |
Series 2022-B, Class A2A, 3.64%, 5/15/2025 | | | 375,124 | | | | 373,329 | |
Series 2021-A, Class A3, 0.38%, 9/15/2025 | | | 1,066,481 | | | | 1,046,129 | |
Series 2020-B, Class A4, 0.62%, 12/15/2025 | | | 1,054,819 | | | | 1,042,292 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
| | |
Mercedes-Benz Auto Lease Trust | | | | | | | | |
Series 2021-B, Class A4, 0.51%, 3/15/2027 | | $ | 3,840,000 | | | $ | 3,770,078 | |
| | |
Mercedes-Benz Auto Receivables Trust | | | | | | | | |
Series 2022-1, Class A2, 5.26%, 10/15/2025 | | | 840,700 | | | | 838,597 | |
Series 2023-1, Class A2, 5.09%, 1/15/2026 | | | 453,664 | | | | 451,923 | |
Series 2021-1, Class A3, 0.46%, 6/15/2026 | | | 1,951,549 | | | | 1,886,709 | |
Series 2023-2, Class A2, 5.92%, 11/16/2026 | | | 2,000,000 | | | | 1,999,643 | |
| | |
Nissan Auto Lease Trust | | | | | | | | |
Series 2021-A, Class A3, 0.52%, 8/15/2024 | | | 33,871 | | | | 33,822 | |
| | |
Nissan Auto Receivables Owner Trust | | | | | | | | |
Series 2022-B, Class A2, 4.50%, 8/15/2025 | | | 1,841,974 | | | | 1,832,771 | |
| | |
Santander Drive Auto Receivables Trust | | | | | | | | |
Series 2022-7, Class A2, 5.81%, 1/15/2026 | | | 463,463 | | | | 463,199 | |
Series 2023-1, Class A2, 5.36%, 5/15/2026 | | | 994,828 | | | | 993,203 | |
Series 2023-3, Class A2, 6.08%, 8/17/2026 | | | 1,400,000 | | | | 1,398,745 | |
| | |
Toyota Auto Receivables Owner Trust | | | | | | | | |
Series 2020-D, Class A4, 0.47%, 1/15/2026 | | | 1,097,000 | | | | 1,067,268 | |
Series 2022-D, Class A2A, 5.27%, 1/15/2026 | | | 862,056 | | | | 859,343 | |
Series 2023-C, Class A2A, 5.60%, 8/17/2026 | | | 1,300,000 | | | | 1,295,583 | |
| | |
Verizon Master Trust | | | | | | | | |
Series 2021-1, Class A, 0.50%, 5/20/2027 | | | 3,000,000 | | | | 2,909,864 | |
| | |
World Omni Auto Receivables Trust | | | | | | | | |
Series 2022-C, Class A2, 3.73%, 3/16/2026 | | | 1,082,705 | | | | 1,073,792 | |
Series 2021-B, Class A3, 0.42%, 6/15/2026 | | | 1,109,752 | | | | 1,076,311 | |
See Accompanying Notes to the Financial Statements.
| | | | |
466 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Ultra-Short Income Fund (cont.)
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
ASSET-BACKED SECURITIES – (continued) | |
Series 2023-D, Class A2A, 5.91%, 2/16/2027 | | $ | 1,700,000 | | | $ | 1,699,857 | |
Total Asset-Backed Securities (Cost $56,459,510) | | | | 56,545,946 | |
| | |
| | | | | | | | |
|
MUNICIPAL BONDS – 0.2% | |
| | |
University of Missouri, System Facilities Revenue Bonds | | | | | | | | |
Series 2020-A, 1.47%, 11/1/2023 | | | 1,000,000 | | | | 1,000,000 | |
| | |
Anaheim Public Financing Authority | | | | | | | | |
Series 2021-A, 0.63%, 7/1/2024 | | | 500,000 | | | | 482,936 | |
| | |
New York City Transitional Finance Authority, Building Aid | | | | | | | | |
Series 2022 Subseries S-1B, 0.64%, 7/15/2024 | | | 1,000,000 | | | | 964,822 | |
Total Municipal Bonds (Cost $2,500,000) | | | | 2,447,758 | |
| | |
| | | | | | | | |
|
SHORT-TERM INVESTMENTS – 6.9%(f) | |
|
U.S. TREASURY OBLIGATIONS – 6.9% | |
| | |
U.S. Treasury Bills | | | | | | | | |
4.91%, 11/2/2023 | | | 15,000,000 | | | | 14,997,811 | |
5.40%, 11/9/2023 | | | 15,000,000 | | | | 14,982,347 | |
5.41%, 11/30/2023 | | | 15,000,000 | | | | 14,936,091 | |
5.22%, 12/14/2023 | | | 10,000,000 | | | | 9,936,784 | |
5.31%, 12/21/2023 | | | 20,000,000 | | | | 19,852,709 | |
Total U.S. Treasury Obligations (Cost $74,712,336) | | | | 74,705,742 | |
Total Investments – 99.3% (Cost $1,072,642,754) | | | | 1,069,254,268 | |
| |
Other assets less liabilities – 0.7% | | | | 7,134,810 | |
NET ASSETS – 100.0% | | | $ | 1,076,389,078 | |
(a) | Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2023. |
(b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
(c) | Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2023. |
(d) | Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end. |
(e) | Represents less than 0.05% of net assets. |
(f) | The rate shown was the current yield as of October 31, 2023. |
Percentages shown are based on Net Assets.
Abbreviations
CME Chicago Mercantile Exchange
ICE Intercontinental Exchange
LIBOR London Interbank Offered Rate
REIT Real Estate Investment Trust
SOFR Secured Overnight Financing Rate
USD US Dollar
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| |
Aggregate gross unrealized appreciation | | $ | 731,366 | |
Aggregate gross unrealized depreciation | | | (4,156,526 | ) |
Net unrealized depreciation | | $ | (3,425,160 | ) |
Federal income tax cost | | $ | 1,072,679,428 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 467 | |
FlexShares® Ultra-Short Income Fund (cont.)
FlexShares® Ultra-Short Income Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2023:
| | | | |
Australia | | | 4.1 | % |
Canada | | | 9.6 | |
Denmark | | | 0.1 | |
Finland | | | 0.2 | |
France | | | 2.3 | |
Germany | | | 3.1 | |
Ireland | | | 0.6 | |
Japan | | | 1.9 | |
Netherlands | | | 1.6 | |
New Zealand | | | 0.5 | |
Saudi Arabia | | | 0.0 | † |
South Korea | | | 0.1 | |
Spain | | | 0.7 | |
Sweden | | | 1.2 | |
Switzerland | | | 0.9 | |
United Kingdom | | | 2.0 | |
United States | | | 70.4 | |
Other1 | | | 0.7 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
1 | Includes any non-fixed-income securities and net other assets (liabilities). |
| | | | |
Security Type | | % of Net Assets | |
Corporate Bonds | | | 86.9 | % |
Asset-Backed Securities | | | 5.3 | |
Municipal Bonds | | | 0.2 | |
Short-Term Investments | | | 6.9 | |
Others(1) | | | 0.7 | |
| | | 100.0 | % |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
468 | | FLEXSHARES ANNUAL REPORT | | |
Schedule of Investments
FlexShares® Core Select Bond Fund
October 31, 2023
| | | | | | | | |
Investments | | Shares | | | Value | |
|
EXCHANGE TRADED FUNDS – 99.8% | |
| | |
FlexShares® Credit-Scored US Corporate Bond Index Fund(a) | | | 292,428 | | | $ | 13,290,121 | |
| | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund(a) | | | 22,200 | | | | 847,983 | |
| | |
FlexShares® Disciplined Duration MBS Index Fund(a) | | | 1,184,745 | | | | 23,209,155 | |
| | |
FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund(a) | | | 166,341 | | | | 3,854,121 | |
| | |
FlexShares® Ultra-Short Income Fund(a) | | | 79,477 | | | | 5,969,915 | |
| | |
iShares 10+ Year Investment Grade Corporate Bond ETF | | | 347,766 | | | | 15,656,425 | |
| | |
iShares 20+ Year Treasury Bond ETF | | | 130,488 | | | | 10,906,187 | |
| | |
iShares 3-7 Year Treasury Bond ETF(b) | | | 233,834 | | | | 26,257,220 | |
| | |
iShares 5-10 Year Investment Grade Corporate Bond ETF | | | 135,709 | | | | 6,471,962 | |
| | |
iShares 7-10 Year Treasury Bond ETF | | | 176,822 | | | | 15,841,483 | |
| | |
iShares MBS ETF(b) | | | 508,968 | | | | 44,086,808 | |
| | |
iShares Trust iShares 1-5 Year Investment Grade Corporate Bond ETF(b) | | | 313,656 | | | | 15,579,294 | |
Total Exchange Traded Funds (Cost $199,416,048) | | | | 181,970,674 | |
| | Principal Amount | | | | |
|
SECURITIES LENDING REINVESTMENTS – 0.0%(c)(d) | |
| |
REPURCHASE AGREEMENTS – 0.0%(c) | | | | |
| | |
CF Secured LLC, 5.30%, dated 10/31/2023, due 11/1/2023, repurchase price $80,337, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2023 - 5/15/2051; total market value $81,000 (Cost $80,325) | | $ | 80,325 | | | | 80,325 | |
| | | | | | | | |
Investments | | Principal Amount | | | Value | |
|
SHORT-TERM INVESTMENTS – 0.0%(c)(e)(f) | |
|
U.S. TREASURY OBLIGATIONS – 0.0% | |
| | |
U.S. Treasury Bills 5.44%, 4/11/2024 (Cost $63,448) | | $ | 65,000 | | | $ | 63,447 | |
Total Investments – 99.8% (Cost $199,559,821) | | | | 182,114,446 | |
| |
Other assets less liabilities – 0.2% | | | | 316,417 | |
NET ASSETS – 100.0% | | | | | | $ | 182,430,863 | |
(a) | Investment in affiliated Fund. Northern Trust Investments, Inc. is the Investment Adviser to both the Fund and the affiliated Funds. |
(b) | The security or a portion of this security is on loan at October 31, 2023. The total value of securities on loan at October 31, 2023 was $12,937,865, collateralized in the form of cash with a value of $80,325 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $12,831,450 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% — 6.13%, and maturity dates ranging from December 14, 2023 — August 15, 2051 and $310,108 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% — 4.25%, and maturity dates ranging from November 13, 2023 — October 22, 2071; a total value of $13,221,883. |
(c) | Represents less than 0.05% of net assets. |
(d) | The security was purchased with cash collateral held from securities on loan at October 31, 2023. The total value of securities purchased was $80,325. |
(e) | The rate shown was the current yield as of October 31, 2023. |
(f) | All or a portion of the security pledged as collateral for Futures Contracts. |
Percentages shown are based on Net Assets.
As of October 31, 2023, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:
| | | | |
| | | |
Aggregate gross unrealized appreciation | | $ | 49,688 | |
Aggregate gross unrealized depreciation | | | (21,918,868 | ) |
Net unrealized depreciation | | $ | (21,869,180 | ) |
Federal income tax cost | | $ | 203,946,377 | |
See Accompanying Notes to the Financial Statements.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 469 | |
FlexShares® Core Select Bond Fund (cont.)
For the period ended October 31, 2023, the FlexShares® Core Select Bond Fund was invested in securities of affiliated FlexShares® Funds. The Schedules of Investments of the affiliated FlexShares® Funds are located elsewhere in this Report.
Investment in a company which was affiliated for the period ended October 31, 2023, was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Security | | Value October 31, 2022 | | | Purchases at Cost | | | Sales Proceeds | | | Shares October 31, 2023 | | | Value October 31, 2023 | | | Change in Unrealized Appreciation (Depreciation) | | | Dividend Income | | | Realized Gain/(Loss) | |
FlexShares® Credit-Scored US Corporate Bond Index Fund | | $ | 11,170,323 | | | $ | 3,677,357 | | | $ | 1,516,721 | | | | 292,428 | | | $ | 13,290,121 | | | $ | (41,755 | ) | | $ | 468,256 | | | $ | 917 | |
FlexShares® Credit-Scored US Long Corporate Bond Index Fund | | | 797,284 | | | | 255,358 | | | | 165,986 | | | | 22,200 | | | | 847,983 | | | | (37,911 | ) | | | 45,867 | | | | (762 | ) |
FlexShares® Disciplined Duration MBS Index Fund | | | 21,492,612 | | | | 17,945,044 | | | | 16,589,407 | | | | 1,184,745 | | | | 23,209,155 | | | | 1,276,791 | | | | 485,385 | | | | (915,885 | ) |
FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | | | 6,398,688 | | | | 1,813,433 | | | | 4,370,772 | | | | 166,341 | | | | 3,854,121 | | | | 245,457 | | | | 174,454 | | | | (232,685 | ) |
FlexShares® Ultra-Short Income Fund | | | 16,002,325 | | | | 3,923,642 | | | | 14,096,511 | | | | 79,477 | | | | 5,969,915 | | | | 92,604 | | | | 524,871 | | | | 47,855 | |
| | $ | 55,861,232 | | | $ | 27,614,834 | | | $ | 36,739,397 | | | | 1,745,191 | | | $ | 47,171,295 | | | $ | 1,535,186 | | | $ | 1,698,833 | | | $ | (1,100,560 | ) |
Futures Contracts
FlexShares® Core Select Bond Fund had the following open futures contracts as of October 31, 2023:
| | | | | | | | | | | | | | | | | | | | |
| | Number of Contracts | | | Expiration Date | | | Trading Currency | | | Notional Amount | | | Value and Unrealized Depreciation* | |
Long Contracts | |
U.S. Treasury 2 Year Note | | | 51 | | | | 12/29/2023 | | | | USD | | | $ | 10,323,516 | | | $ | (37,249 | ) |
* | This amount represents the cumulative appreciation/depreciation on futures contracts. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
Abbreviations:
USD – US Dollar
| | | | |
Security Type | | % of Net Assets | |
Exchange Traded Funds | | | 99.8 | % |
Securities Lending Reinvestments | | | 0.0 | † |
Short-Term Investments | | | 0.0 | † |
Others(1) | | | 0.2 | |
| | | 100.0 | % |
† | Amount represents less than 0.05%. |
(1) | Includes any other net assets/(liabilities). |
See Accompanying Notes to the Financial Statements.
| | | | |
470 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements October 31, 2023
1. Organization
FlexShares® Trust (the “Trust”), a Maryland statutory trust, was formed on May 13, 2010, originally named NT ETF Trust and renamed FlexShares® Trust as of April 12, 2011. The Trust is registered as an open-end management investment company under the Investment Company Act of 1940 (the “1940 Act”), as amended. The Trust consists of thirty operational exchange-traded funds as of October 31, 2023 (each a “Fund” and collectively, the “Funds”).
FlexShares® ESG & Climate US Large Cap Core Index Fund, FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares® ESG & Climate Emerging Markets Core Index Fund, and FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund are non-diversified series of the Trust, pursuant to the 1940 Act. Each of the other Funds are diversified series of the Trust, pursuant to the 1940 Act.
Each Fund, except the FlexShares Ultra-Short Income Fund and the FlexShares Core Select Bond Fund, seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of a specified benchmark index (each an “Underlying Index”). The FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund seek to track Underlying Indexes developed by Northern Trust Investments, Inc.
(“NTI” or “Investment Adviser”), an indirect subsidiary of Northern Trust Corporation. The FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund and FlexShares Morningstar Global Upstream Natural Resources Index Fund seek to track Underlying Indexes sponsored by Morningstar, Inc. The FlexShares STOXX® US ESG Select Index Fund, FlexShares STOXX® Global ESG Select Index Fund, and FlexShares STOXX® Global Broad Infrastructure Index Fund seek to track Underlying Indexes sponsored by STOXX. The FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and FlexShares iBoxx 5-Year Target Duration TIPS Index Fund seek to track Underlying Indexes sponsored by Markit Indexes Limited. The FlexShares Disciplined Duration MBS Index Fund seeks to track an Underlying Index sponsored by ICE Data Indexes, LLC.
The FlexShares Real Assets Allocation Index Fund is a fund of funds that seeks to achieve its investment objective by investing primarily in the shares of other FlexShares ETFs that are eligible for inclusion in its Underlying Index, rather than in securities of individual companies. The FlexShares Core Select Bond Fund seeks to achieve its investment objective by investing, under normal circumstances in U.S. dollar-denominated investment-grade fixed-income securities either directly or indirectly through FlexShares ETFs, unaffiliated ETFs and other registered investment companies. The investment performance of each of the FlexShares Real Assets Allocation Index Fund and FlexShares Core Select Bond Fund is directly related to the performance of the underlying funds in which it invests (“Underlying Fund”).
The FlexShares Ultra-Short Income Fund and the FlexShares Core Select Bond Fund are actively managed and do not seek to replicate the performance of a specified index. The FlexShares Ultra-Short Income Fund seeks maximum current income consistent with the preservation of capital and liquidity. The FlexShares Core Select Bond Fund seeks total return and preservation of capital. Each Fund, except the FlexShares Ultra-Short Income Fund and the FlexShares Core Select Bond Fund, is referred to herein as an “Index Fund.” Each Fund is managed by the Investment Adviser.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 471 | |
Notes to the Financial Statements (cont.)
On March 23, 2023, the Trust’s Board of Trustees (“Board”) unanimously approved a reorganization whereby the FlexShares Quality Dividend Index Fund acquired all of the assets and liabilities of the FlexShares Quality Dividend Dynamic Index Fund on June 30, 2023. All costs related to the reorganization were paid by NTI.
2. Significant Accounting Policies
The Trust, which is an investment company, follows accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946, “Financial Services-Investment Companies.” The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
Investment Valuation
Each Fund’s net asset value (“NAV”) is determined daily as of the close of regular trading on the New York Stock Exchange (“NYSE”), normally 4:00 p.m. Eastern time, on each day the NYSE is open for trading, based on prices at the time of closing provided that any U.S. fixed-income assets may be valued as of the announced closing time for trading in fixed-income instruments on any day that the Securities Industry and Financial Markets Association announces an early closing time. The NAV of a Fund is calculated by dividing the value of all assets of the Fund (including accrued interest and dividends), less all liabilities (including accrued expenses and dividends declared but unpaid), by the total number of shares outstanding.
The investments of the Funds are valued at fair value pursuant to the pricing policy and procedures approved by the Trust’s Board of Trustees (“Board”). The Funds’ investments are valued using market quotations when available. The Board has designated NTI as the valuation designee pursuant to Rule 2a-5 under the 1940 Act to perform fair value determinations relating to any or all Fund invest-
ments. Accordingly, when market quotations are not readily available, are deemed unreliable, or do not reflect material events occurring between the close of local markets and the time of valuation, NTI values Fund securities at fair value as determined in good faith in accordance with the Funds’ fair value pricing procedures as approved by the Board. Such circumstances include periods when trading in a security is suspended, the exchange or market on which a security trades closes early, the trading volume in a security is limited, corporate actions and announcements take place, or regulatory news affecting an issuer is released, such as government approvals. The Board oversees NTI in its role as valuation designee in accordance with the requirements of Rule 2a-5 under the 1940 Act. Additionally, NTI, in its discretion, may make adjustments to the prices of securities held by a Fund if an event occurs after the publication of market values normally used by NTI on behalf of a Fund but before the time as of which the Fund calculates its NAV, depending on the nature and significance of the event, consistent with applicable regulatory guidance and the Trust’s fair value procedures. Other events that can trigger fair valuing of foreign securities include, for example, significant fluctuations in general market indicators, government actions, or natural disasters.
The use of fair valuation involves the risk that the values used by NTI to price a Fund’s investments may be higher or lower than the values used by other investment companies and investors to price the same investments. Fair value pricing involves subjective judgments and it is possible that a fair value determination for a portfolio security may be materially different than the value that could be realized upon the sale of such security. In addition, fair value pricing could result in a difference between the prices used to calculate an Index Fund’s NAV and the prices used by an Index Fund’s Underlying Index. This difference may adversely affect an Index Fund’s ability to track its Underlying Index. Portfolio securities of certain Funds are listed on foreign exchanges and their value may change on days when shareholders will not be able to purchase or sell Fund shares.
Security prices are generally provided by independent pricing services. Portfolio securities listed or traded on domestic securities exchanges or the NASDAQ/NMS, including
| | | | |
472 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
dollar-denominated foreign securities or American Depositary Receipts (“ADRs”), are valued at the closing price, or last sale price, reported on the exchange or system where the security is principally traded. The closing price for securities traded on the NASDAQ/NMS is the Nasdaq Official Closing Price (“NOCP”). If there have been no sales for that day on the exchange or system where the security is principally traded, then the value is determined with reference to the last sale price, or the NOCP, if applicable, on any other exchange or system. If there have been no sales of the security for that day on any exchange or system, the security is valued at fair value pursuant to the Trust’s fair value procedures.
Securities that are traded regularly in the over-the-counter market (other than the NASDAQ/NMS), including securities listed on exchanges but primarily traded over-the-counter, are valued on the basis of bid quotes or the mean between the bid and asked quotes based upon quotes furnished by one or more broker-dealers or market makers for those securities. Securities that may be traded over-the-counter include equity securities, fixed-income securities, non-exchange-listed foreign securities, and certain derivative instruments. Fixed-income securities may be valued using prices provided directly from one or more broker-dealers, market makers, or independent third-party pricing services which may use matrix pricing and valuation models, as well as recent market transactions for the same or similar assets, to derive values when such prices are believed to reflect fair market values of such securities. Such prices may be determined by taking into account securities prices, yields, maturities, call features, ratings, prepayment speeds, credit risks, cash flows, institutional size trading in similar groups of securities and developments related to specific securities. Fixed-income securities maturing within a relatively short period, less than 60 days, are valued at amortized cost when it approximates fair value.
Foreign equity securities are generally priced at the closing price or last sales price reported on the foreign exchange on which they are principally traded. If there have been no sales for that day on the primary exchange, then the value is determined with reference to the last sale price on any other exchange. If there have been no sales of the security for that
day on any exchange, the security will be valued at fair value pursuant to the Trust’s fair value procedures. Spot and forward foreign currency exchange contracts generally are valued using an independent pricing service. The value of assets denominated in foreign currencies is converted into U.S. dollars using exchange rates deemed appropriate by NTI as Investment Adviser. Any use of a different rate from the rates used by an Underlying Index’s index provider may adversely affect an Index Fund’s ability to track its Underlying Index. An Underlying Index’s index provider determines the composition and relative weightings of the securities in the Underlying Index and publishes information regarding the market value of the Underlying Index.
Exchange-traded financial futures and options thereon are valued at the settlement price as established by the exchange on which they are traded. Over-the-counter options are valued at broker-provided bid prices, as are swaps. The foregoing prices may be obtained from one or more independent pricing services or, as needed or applicable, independent broker-dealers. If there was no sale on that day, and for other non-exchange traded derivatives, the contract is valued at fair value pursuant to the Trust’s fair value procedures.
Each Fund relies on various sources to calculate its NAV. The ability of the Funds’ administrator to calculate the NAV per share of the Funds is subject to operational risks associated with processing or human errors, systems or technology failures, and errors caused by third party service providers, data sources, or trading counterparties. Such failures may result in delays in the calculation of the Funds’ NAVs and/or the inability to calculate NAV over extended time periods. The Funds may be unable to recover any losses associated with such failures, and it may be necessary for alternative procedures to be followed to price portfolio securities when determining the Funds’ NAVs.
Various inputs are used in determining the value of each Fund’s investments. These inputs are summarized in three levels listed below:
| • | | Level 1—Quoted prices in active markets for identical assets on the measurement date. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 473 | |
Notes to the Financial Statements (cont.)
| • | | Level 2—Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). |
| • | | Level 3—Significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments). |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, short-term debt securities may be valued at amortized cost, as long as amortized cost approximates the current fair value of a security, but since the valuation is not obtained from a quoted price in an active market, such securities are reflected as Level 2.
The following is a summary of the valuations as of October 31, 2023 for each Fund based upon the three levels defined above. The value of level 3 securities compared to the total Fund net assets is not material and, therefore, the reconciliation of Level 3 securities and related valuation techniques are not disclosed. Please refer to the Schedules of Investments to view equity and debt securities segregated by industry type, where applicable.
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares US Quality Low Volatility Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 184,777,273 | | | $ | — | | | $ | — | | | $ | 184,777,273 | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 2,683,994 | | | | — | | | | 2,683,994 | |
| | | | |
Short-Term Investments | | | — | | | | 19,522 | | | | — | | | | 19,522 | |
| | | | |
Total Investments | | $ | 184,777,273 | | | $ | 2,703,516 | | | $ | — | | | $ | 187,480,789 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | |
Futures Contracts | | $ | 2,310 | | | $ | — | | | $ | — | | | $ | 2,310 | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | | (345 | ) | | | — | | | | — | | | | (345 | ) |
| | | | |
Total Other Financial Instruments | | $ | 1,965 | | | $ | — | | | $ | — | | | $ | 1,965 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | |
Investments | |
Common Stocks* | | $ | 64,658,984 | | | $ | — | | | $ | — | | | $ | 64,658,984 | |
| | | | |
Warrants | | | — | | | | — | | | | — | | | | — | |
| | | | |
Total Investments | | $ | 64,658,984 | | | $ | — | | | $ | — | | | $ | 64,658,984 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 27,699 | | | $ | — | | | $ | 27,699 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (79,276 | ) | | | — | | | | — | | | | (79,276 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (18,644 | ) | | | — | | | | (18,644 | ) |
| | | | |
Total Other Financial Instruments | | $ | (79,276 | ) | | $ | 9,055 | | | $ | — | | | $ | (70,221 | ) |
| | | | |
474 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Emerging Markets Quality Low Volatility Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Common Stocks* | | $ | 12,867,943 | | | $ | — | | | $ | — | | | $ | 12,867,943 | |
| | | | |
Total Investments | | $ | 12,867,943 | | | $ | — | | | $ | — | | | $ | 12,867,943 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (12,537 | ) | | $ | — | | | $ | — | | | $ | (12,537 | ) |
| | | | |
Total Other Financial Instruments | | $ | (12,537 | ) | | $ | — | | | $ | — | | | $ | (12,537 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Morningstar US Market Factor Tilt Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | |
Biotechnology | | $ | 31,681,342 | | | $ | 701,519 | | | $ | 149 | | | $ | 32,383,010 | |
Life Sciences Tools & Services | | | 13,327,089 | | | | — | | | | 90 | | | | 13,327,179 | |
Other* | | | 1,277,816,265 | | | | — | | | | — | | | | 1,277,816,265 | |
Rights | | | — | | | | — | | | | 62,082 | | | | 62,082 | |
Warrants | | | 170,043 | | | | — | | | | — | | | | 170,043 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Certificates of Deposit | | | — | | | | 50,978,517 | | | | — | | | | 50,978,517 | |
Commercial Paper | | | — | | | | 6,000,000 | | | | — | | | | 6,000,000 | |
Investment Companies | | | — | | | | 17,000,000 | | | | — | | | | 17,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 93,173,156 | | | | — | | | | 93,173,156 | |
| | | | |
Total Investments | | $ | 1,322,994,739 | | | $ | 167,853,192 | | | $ | 62,321 | | | $ | 1,490,910,252 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (730,606 | ) | | $ | — | | | $ | — | | | $ | (730,606 | ) |
| | | | |
Total Other Financial Instruments | | $ | (730,606 | ) | | $ | — | | | $ | — | | | $ | (730,606 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 475 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Closed End Funds | | $ | 58,143 | | | $ | — | | | $ | — | | | $ | 58,143 | |
Common Stocks | | | | | | | | | | | | | | | | |
Beverages | | | 4,661,728 | | | | 66,407 | | | | — | | | | 4,728,135 | |
Food Products | | | 12,058,362 | | | | 47,895 | | | | — | | | | 12,106,257 | |
Metals & Mining | | | 23,539,055 | | | | — | | | | 13,355 | | | | 23,552,410 | |
Other* | | | 421,567,064 | | | | — | | | | — | | | | 421,567,064 | |
Rights | | | 2,063 | | | | 32,422 | | | | — | | | | 34,485 | |
Warrants | | | — | | | | — | | | | — | | | | — | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Investment Companies | | | — | | | | 1,000,000 | | | | — | | | | 1,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 7,760,452 | | | | — | | | | 7,760,452 | |
| | | | |
Total Investments | | $ | 461,886,415 | | | $ | 8,907,176 | | | $ | 13,355 | | | $ | 470,806,946 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 14,407 | | | $ | — | | | $ | 14,407 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (329,765 | ) | | | — | | | | — | | | | (329,765 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (44,298 | ) | | | — | | | | (44,298 | ) |
| | | | |
Total Other Financial Instruments | | $ | (329,765 | ) | | $ | (29,891 | ) | | $ | — | | | $ | (359,656 | ) |
| | | | |
476 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | |
Automobile Components | | $ | 2,592,413 | | | $ | 26,496 | | | $ | — | | | $ | 2,618,909 | |
Banks | | | 29,920,232 | | | | 691 | | | | — | | | | 29,920,923 | |
Commercial Services & Supplies | | | 347,865 | | | | — | | | | 27,518 | | | | 375,383 | |
Construction & Engineering | | | 3,080,729 | | | | — | | | | 2,021 | | | | 3,082,750 | |
Consumer Staples Distribution & Retail | | | 2,602,124 | | | | 393 | | | | — | | | | 2,602,517 | |
Distributors | | | 188,452 | | | | 809 | | | | — | | | | 189,261 | |
Food Products | | | 5,972,830 | | | | 13,917 | | | | — | | | | 5,986,747 | |
Health Care Equipment & Supplies | | | 486,228 | | | | 12,838 | | | | — | | | | 499,066 | |
Health Care Providers & Services | | | 2,138,209 | | | | 8,663 | | | | — | | | | 2,146,872 | |
Hotels, Restaurants & Leisure | | | 4,567,267 | | | | 2,003 | | | | — | | | | 4,569,270 | |
Independent Power and Renewable Electricity Producers | | | 2,946,919 | | | | 3,418 | | | | — | | | | 2,950,337 | |
Marine Transportation | | | 856,942 | | | | — | | | | 23,403 | | | | 880,345 | |
Oil, Gas & Consumable Fuels | | | 11,825,999 | | | | 2,140 | | | | — | | | | 11,828,139 | |
Real Estate Management & Development | | | 6,941,928 | | | | — | | | | 51,372 | | | | 6,993,300 | |
Retail REITs | | | 746,061 | | | | 11,656 | | | | — | | | | 757,717 | |
Transportation Infrastructure | | | 1,682,767 | | | | 100,285 | | | | — | | | | 1,783,052 | |
Other* | | | 141,717,496 | | | | — | | | | — | | | | 141,717,496 | |
Corporate Bonds* | | | — | | | | 4,971 | | | | — | | | | 4,971 | |
Rights | | | 194 | | | | 773 | | | | — | | | | 967 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 677,315 | | | | — | | | | 677,315 | |
| | | | |
Total Investments | | $ | 218,614,655 | | | $ | 866,368 | | | $ | 104,314 | | | $ | 219,585,337 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 6,171 | | | $ | — | | | $ | 6,171 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (51,792 | ) | | | — | | | | — | | | | (51,792 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (333 | ) | | | — | | | | (333 | ) |
| | | | |
Total Other Financial Instruments | | $ | (51,792 | ) | | $ | 5,838 | | | $ | — | | | $ | (45,954 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 477 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares US Quality Large Cap Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Common Stocks* | | $ | 145,727,979 | | | $ | — | | | $ | — | | | $ | 145,727,979 | |
| | | | |
Total Investments | | $ | 145,727,979 | | | $ | — | | | $ | — | | | $ | 145,727,979 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (65,571 | ) | | $ | — | | | $ | — | | | $ | (65,571 | ) |
| | | | |
Total Other Financial Instruments | | $ | (65,571 | ) | | $ | — | | | $ | — | | | $ | (65,571 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares STOXX® US ESG Select Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 164,929,437 | | | $ | — | | | $ | — | | | $ | 164,929,437 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 97,159 | | | | — | | | | 97,159 | |
| | | | |
Total Investments | | $ | 164,929,437 | | | $ | 97,159 | | | $ | — | | | $ | 165,026,596 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (116,118 | ) | | $ | — | | | $ | — | | | $ | (116,118 | ) |
| | | | |
Total Other Financial Instruments | | $ | (116,118 | ) | | $ | — | | | $ | — | | | $ | (116,118 | ) |
| | | | |
478 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares STOXX® Global ESG Select Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | |
Beverages | | $ | 2,565,386 | | | $ | 44,404 | | | $ | — | | | $ | 2,609,790 | |
Metals & Mining | | | 2,425,518 | | | | 76,847 | | | | — | | | | 2,502,365 | |
Other* | | | 144,935,968 | | | | — | | | | — | | | | 144,935,968 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 857,504 | | | | — | | | | 857,504 | |
| | | | |
Total Investments | | $ | 149,926,872 | | | $ | 978,755 | | | $ | — | | | $ | 150,905,627 | |
| | | | |
Other Financial Instruments | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 7,756 | | | | — | | | $ | 7,756 | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | | (90,109 | ) | | | — | | | | — | | | | (90,109 | ) |
| | | | |
Total Other Financial Instruments | | $ | (90,109 | ) | | $ | 7,756 | | | $ | — | | | $ | (82,353 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares ESG & Climate US Large Cap Core Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 36,588,876 | | | $ | — | | | $ | — | | | $ | 36,588,876 | |
| | | | |
Short-Term Investments | | | — | | | | 24,403 | | | | — | | | | 24,403 | |
| | | | |
Total Investments | | $ | 36,588,876 | | | $ | 24,403 | | | $ | — | | | $ | 36,613,279 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (17,721 | ) | | $ | — | | | $ | — | | | $ | (17,721 | ) |
| | | | |
Total Other Financial Instruments | | $ | (17,721 | ) | | $ | — | | | $ | — | | | $ | (17,721 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 479 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Common Stocks* | | $ | 36,835,813 | | | $ | — | | | $ | — | | | $ | 36,835,813 | |
| | | | |
Total Investments | | $ | 36,835,813 | | | $ | — | | | $ | — | | | $ | 36,835,813 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 6,492 | | | $ | — | | | $ | 6,492 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (21,494 | ) | | | — | | | | — | | | | (21,494 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (3,294 | ) | | | — | | | | (3,294 | ) |
| | | | |
Total Other Financial Instruments | | $ | (21,494 | ) | | $ | 3,198 | | | $ | — | | | $ | (18,296 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares ESG & Climate Emerging Markets Core Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Common Stocks* | | $ | 4,152,508 | | | $ | — | | | $ | — | | | $ | 4,152,508 | |
| | | | |
Total Investments | | $ | 4,152,508 | | | $ | — | | | $ | — | | | $ | 4,152,508 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 3 | | | $ | — | | | $ | 3 | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | | (3,512 | ) | | | — | | | | — | | | | (3,512 | ) |
| | | | |
Total Other Financial Instruments | | $ | (3,512 | ) | | $ | 3 | | | $ | — | | | $ | (3,509 | ) |
| | | | |
480 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Morningstar Global Upstream Natural Resources Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 6,897,383,095 | | | $ | — | | | $ | — | | | $ | 6,897,383,095 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Certificates of Deposit | | | — | | | | 60,967,202 | | | | — | | | | 60,967,202 | |
Commercial Paper | | | — | | | | 2,000,000 | | | | — | | | | 2,000,000 | |
Investment Companies | | | — | | | | 78,000,000 | | | | — | | | | 78,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 162,795,983 | | | | — | | | | 162,795,983 | |
| | | | |
Total Investments | | $ | 6,897,383,095 | | | $ | 303,763,185 | | | $ | — | | | $ | 7,201,146,280 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 805,889 | | | $ | — | | | $ | 805,889 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (1,738,108 | ) | | | — | | | | — | | | | (1,738,108 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (827,889 | ) | | | — | | | | (827,889 | ) |
| | | | |
Total Other Financial Instruments | | $ | (1,738,108 | ) | | $ | (22,000 | ) | | $ | — | | | $ | (1,760,108 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares STOXX® Global Broad Infrastructure Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 2,006,949,303 | | | $ | — | | | $ | — | | | $ | 2,006,949,303 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Investment Companies | | | — | | | | 11,000,000 | | | | — | | | | 11,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 29,144,363 | | | | — | | | | 29,144,363 | |
| | | | |
Total Investments | | $ | 2,006,949,303 | | | $ | 40,144,363 | | | $ | — | | | $ | 2,047,093,666 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 78,847 | | | $ | — | | | $ | 78,847 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (920,022 | ) | | | — | | | | — | | | | (920,022 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (14,821 | ) | | | — | | | | (14,821 | ) |
| | | | |
Total Other Financial Instruments | | $ | (920,022 | ) | | $ | 64,026 | | | $ | — | | | $ | (855,996 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 481 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Global Quality Real Estate Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 241,286,554 | | | $ | — | | | $ | — | | | $ | 241,286,554 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 2,704,220 | | | | — | | | | 2,704,220 | |
| | | | |
Total Investments | | $ | 241,286,554 | | | $ | 2,704,220 | | | $ | — | | | $ | 243,990,774 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 17,694 | | | $ | — | | | $ | 17,694 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (239,027 | ) | | | — | | | | — | | | | (239,027 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (20,492 | ) | | | — | | | | (20,492 | ) |
| | | | |
Total Other Financial Instruments | | $ | (239,027 | ) | | $ | (2,798 | ) | | $ | — | | | $ | (241,825 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 —Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Real Assets Allocation Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Exchange Traded Funds | | $ | 16,571,447 | | | $ | — | | | $ | — | | | $ | 16,571,447 | |
| | | | |
Total Investments | | $ | 16,571,447 | | | $ | — | | | $ | — | | | $ | 16,571,447 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Quality Dividend Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 1,475,944,235 | | | $ | — | | | $ | — | | | $ | 1,475,944,235 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Certificates of Deposit | | | — | | | | 31,984,158 | | | | — | | | | 31,984,158 | |
Commercial Paper | | | — | | | | 2,000,000 | | | | — | | | | 2,000,000 | |
Investment Companies | | | — | | | | 18,000,000 | | | | — | | | | 18,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 77,465,697 | | | | — | | | | 77,465,697 | |
| | | | |
Total Investments | | $ | 1,475,944,235 | | | $ | 129,449,855 | | | $ | — | | | $ | 1,605,394,090 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (55,107 | ) | | $ | — | | | $ | — | | | $ | (55,107 | ) |
| | | | |
Total Other Financial Instruments | | $ | (55,107 | ) | | $ | — | | | $ | — | | | $ | (55,107 | ) |
| | | | |
482 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Quality Dividend Defensive Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 311,680,030 | | | $ | — | | | $ | — | | | $ | 311,680,030 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Investment Companies | | | — | | | | 1,000,000 | | | | — | | | | 1,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 17,783,683 | | | | — | | | | 17,783,683 | |
| | | | |
Total Investments | | $ | 311,680,030 | | | $ | 18,783,683 | | | $ | — | | | $ | 330,463,713 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (70,583 | ) | | $ | — | | | $ | — | | | $ | (70,583 | ) |
| | | | |
Total Other Financial Instruments | | $ | (70,583 | ) | | $ | — | | | $ | — | | | $ | (70,583 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares International Quality Dividend Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 489,966,079 | | | $ | — | | | $ | — | | | $ | 489,966,079 | |
Securities Lending Reinvestments | | | | | | | | | | | | | | | | |
Investment Companies | | | — | | | | 2,000,000 | | | | — | | | | 2,000,000 | |
| | | | |
Repurchase Agreements | | | — | | | | 149,574 | | | | — | | | | 149,574 | |
| | | | |
Total Investments | | $ | 489,966,079 | | | $ | 2,149,574 | | | $ | — | | | $ | 492,115,653 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 212,595 | | | $ | — | | | $ | 212,595 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (505,171 | ) | | | — | | | | — | | | | (505,171 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (135,605 | ) | | | — | | | | (135,605 | ) |
| | | | |
Total Other Financial Instruments | | $ | (505,171 | ) | | $ | 76,990 | | | $ | — | | | $ | (428,181 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 483 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares International Quality Dividend Defensive Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 25,342,351 | | | $ | — | | | $ | — | | | $ | 25,342,351 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 125,891 | | | | — | | | | 125,891 | |
| | | | |
Total Investments | | $ | 25,342,351 | | | $ | 125,891 | | | $ | — | | | $ | 25,468,242 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (74,486 | ) | | $ | — | | | $ | — | | | $ | (74,486 | ) |
| | | | |
Total Other Financial Instruments | | $ | (74,486 | ) | | $ | — | | | $ | — | | | $ | (74,486 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares International Quality Dividend Dynamic Index Fund | |
Investments | | | | | | | | | | | | | | | | |
Common Stocks* | | $ | 64,781,455 | | | $ | — | | | $ | — | | | $ | 64,781,455 | |
| | | | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 695,880 | | | | — | | | | 695,880 | |
| | | | |
Total Investments | | $ | 64,781,455 | | | $ | 695,880 | | | $ | — | | | $ | 65,477,335 | |
|
Other Financial Instruments | |
Assets | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | $ | — | | | $ | 5,506 | | | $ | — | | | $ | 5,506 | |
Liabilities | | | | | | | | | | | | | | | | |
Futures Contracts | | | (62,745 | ) | | | — | | | | — | | | | (62,745 | ) |
| | | | |
Forward Foreign Currency Contracts | | | — | | | | (1,549 | ) | | | — | | | | (1,549 | ) |
| | | | |
Total Other Financial Instruments | | $ | (62,745 | ) | | $ | 3,957 | | | $ | — | | | $ | (58,788 | ) |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
U.S. Treasury Obligations | | $ | — | | | $ | 1,923,187,015 | | | $ | — | | | $ | 1,923,187,015 | |
| | | | |
Total Investments | | $ | — | | | $ | 1,923,187,015 | | | $ | — | | | $ | 1,923,187,015 | |
| | | | |
484 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
U.S. Treasury Obligations | | $ | — | | | $ | 809,374,738 | | | $ | — | | | $ | 809,374,738 | |
| | | | |
Total Investments | | $ | — | | | $ | 809,374,738 | | | $ | — | | | $ | 809,374,738 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Disciplined Duration MBS Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Mortgage-Backed Securities | | $ | — | | | $ | 73,778,449 | | | $ | — | | | $ | 73,778,449 | |
| | | | |
Total Investments | | $ | — | | | $ | 73,778,449 | | | $ | — | | | $ | 73,778,449 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Credit-Scored US Corporate Bond Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Corporate Bonds* | | $ | — | | | $ | 265,621,732 | | | $ | — | | | $ | 265,621,732 | |
| | | | |
Total Investments | | $ | — | | | $ | 265,621,732 | | | $ | — | | | $ | 265,621,732 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Credit-Scored US Long Corporate Bond Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Corporate Bonds* | | $ | — | | | $ | 27,787,389 | | | $ | — | | | $ | 27,787,389 | |
| | | | |
Total Investments | | $ | — | | | $ | 27,787,389 | | | $ | — | | | $ | 27,787,389 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares High Yield Value-Scored Bond Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Corporate Bonds* | | $ | — | | | $ | 1,199,469,056 | | | $ | — | | | $ | 1,199,469,056 | |
| | | | |
Total Investments | | $ | — | | | $ | 1,199,469,056 | | | $ | — | | | $ | 1,199,469,056 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 485 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | |
Investments | | | | | | | | | | | | | | | | |
| | | | |
Corporate Bonds* | | $ | — | | | $ | 23,856,368 | | | $ | — | | | $ | 23,856,368 | |
| | | | |
Total Investments | | $ | — | | | $ | 23,856,368 | | | $ | — | | | $ | 23,856,368 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Ultra-Short Income Fund | |
Investments | |
Asset-Backed Securities | | $ | — | | | $ | 56,545,946 | | | $ | — | | | $ | 56,545,946 | |
Corporate Bonds* | | | — | | | | 935,554,822 | | | | — | | | | 935,554,822 | |
Municipal Bonds | | | — | | | | 2,447,758 | | | | — | | | | 2,447,758 | |
| | | | |
Short-Term Investments | | | — | | | | 74,705,742 | | | | — | | | | 74,705,742 | |
| | | | |
Total Investments | | $ | — | | | $ | 1,069,254,268 | | | $ | — | | | $ | 1,069,254,268 | |
| | | | |
| | | | | | | | | | | | | | | | |
| | Level 1 — Quoted Prices | | | Level 2 — Other Significant Observable Inputs | | | Level 3 — Significant Unobservable Inputs | | | Total | |
|
FlexShares Core Select Bond Fund | |
Investments | | | | | | | | | | | | | | | | |
Exchange Traded Funds | | $ | 181,970,674 | | | $ | — | | | $ | — | | | $ | 181,970,674 | |
Securities Lending Reinvestments Repurchase Agreements | | | — | | | | 80,325 | | | | — | | | | 80,325 | |
| | | | |
Short-Term Investments | | | — | | | | 63,447 | | | | — | | | | 63,447 | |
| | | | |
Total Investments | | $ | 181,970,674 | | | $ | 143,772 | | | $ | — | | | $ | 182,114,446 | |
|
Other Financial Instruments | |
Liabilities | | | | | | | | | | | | | | | | |
| | | | |
Futures Contracts | | $ | (37,249 | ) | | $ | — | | | $ | — | | | $ | (37,249 | ) |
| | | | |
Total Other Financial Instruments | | $ | (37,249 | ) | | $ | — | | | $ | — | | | $ | (37,249 | ) |
* | See Schedules of Investments for segregation by industry type. |
| | | | |
486 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
Foreign Securities
The FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund (through its investment in its Underlying Funds), FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund and the FlexShares ESG & Climate Emerging Markets Core Index Fund invest in publicly-traded equity securities of issuers in countries other than the United States of America (“U.S.”). Such investments include direct investments in non-U.S. dollar denominated securities traded outside the U.S. The Funds’ investments in foreign securities also may be in the form of ADRs and Global Depositary Receipts (“GDRs”) (collectively, “Depositary Receipts”) based on securities in their Underlying Indexes. ADRs are receipts that are traded in the United States evidencing ownership of the underlying foreign securities and are denominated in U.S. dollars. GDRs are receipts issued by a non-U.S. financial institution evidencing ownership of underlying foreign or U.S. securities and usually are denominated in foreign currencies. GDRs may not be denominated in the same currency as the securities they represent. Generally, GDRs are designed for use in foreign securities markets.
In addition to investment risks associated with the underlying issuer, ADRs and GDRs expose a Fund to risk associated with non-uniform terms that apply to ADR and GDR programs, credit exposure to the depository bank and to the sponsors and other parties with whom the depository bank establishes the programs, currency and liquidity risk. ADRs and GDRs are generally subject to the same risks as the foreign securities that they evidence or into which they may be converted.
To the extent a Fund invests in ADRs, such ADRs will be listed on a national securities exchange. To the extent a Fund invests in GDRs, such GDRs will be listed on a foreign exchange. A Fund will not invest in any unlisted Depositary Receipt, any Depositary Receipt that NTI deems to be illiquid or any Depositary Receipt for which market quotations are not readily available. Generally, all Depositary Receipts must be sponsored.
The FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund may invest in U.S. dollar denominated bonds of non-U.S. corporations to the extent such bonds are included in each Fund’s Underlying Index. The FlexShares Core Select Bond Fund may invest in U.S. dollar denominated bonds of non-U.S. corporations, either directly or indirectly through Underlying Funds, to achieve its investment objective.
The FlexShares Ultra-Short Income Fund may invest, without limitation, in fixed-income securities and instruments of foreign issuers in developed and emerging markets, including debt securities of foreign governments.
Investing in foreign securities, including Depositary Receipts, may result in a Fund experiencing more rapid and extreme changes in value than a fund that invests exclusively in U.S. securities, due to less liquid markets, and adverse economic, political, diplomatic, financial, and regulatory factors. Foreign governments also may impose taxes and limits on investment and repatriation. Any of these events could cause the value of a Fund’s foreign investment to decline. To the extent that a Fund’s assets are significantly invested in a single country or geographic region, a Fund will be subject to the risks associated with that particular country or region.
The FlexShares Emerging Markets Quality Low Volatility Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, and FlexShares ESG & Climate Emerging Markets Core Index Fund will invest primarily in emerging market countries. In addition, the FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 487 | |
Notes to the Financial Statements (cont.)
STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund (through its investment in its Underlying Funds), FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and the FlexShares International Quality Dividend Dynamic Index Fund may invest its assets in emerging market countries. The FlexShares Ultra-Short Income Fund may invest up to 20% of its total assets in fixed-income securities and instruments of issuers in emerging markets. The markets of emerging market countries are less developed and less liquid, subject to greater price volatility and generally subject to increased economic, political, regulatory and other uncertainties than more developed foreign markets. The risks of foreign investment are increased when the issuer is located in a country with an emerging economy or securities market.
Inflation-Indexed Securities
The FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund invest primarily in U.S. Treasury Inflation-Protected Securities (“TIPS”).
TIPS have varying maturities and pay interest on a semiannual basis equal to a fixed percentage of the inflation-adjusted principal amount. If the periodic adjustment rate measuring inflation falls, the principal value of TIPS will be adjusted downward, and consequently the interest payable on these securities (calculated with respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is guaranteed in the case of TIPS, even during a period of deflation.
The value of TIPS is expected to change in response to changes in real interest rates. Real interest rates in turn are tied to the relationship between nominal interest rates and the rate of inflation. Therefore, if the rate of inflation rises at a faster rate than nominal interest rates, real interest rates might decline, leading to an increase in value of TIPS. In contrast, if nominal interest rates increase at a faster rate
than inflation, real interest rates might rise, leading to a decrease in value of TIPS. Any increase in the principal amount of TIPS will be considered taxable ordinary income, even though investors do not receive their principal until maturity.
While these securities are expected to be protected from long-term inflationary trends, short-term increases in inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation, investors in these securities may not be protected to the extent that the increase is not reflected in the TIPS’ inflation measure.
The periodic adjustment of TIPS is tied to the Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S. Bureau of Labor Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing, food, transportation and energy. There can be no assurance that the CPI-U will accurately measure the real rate of inflation in the prices of goods and services.
Mortgage-Backed Pass-Through Securities
The FlexShares Disciplined Duration MBS Index Fund invests primarily in U.S. agency mortgage-backed pass-through securities (“MBS”), a category of pass-through securities backed by pools of mortgages and issued by one of the following U.S. government agencies: the Federal National Mortgage Association (FNMA or Fannie Mae), the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) or the Government National Mortgage Association (GNMA or Ginnie Mae) (each a “US Agency”). Under normal circumstances, the Fund will invest at least 80% of its total assets in the securities of its Underlying Index and in “to-be announced transactions” (“TBA transactions”) that represent securities in its Underlying Index. In a TBA transaction, the buyer and seller agree upon general trade parameters such as agency, coupon rate, settlement date, par amount and price. The actual pools delivered generally are determined two days prior to settlement.
Pending settlement of such TBA contracts, the FlexShares Disciplined Duration MBS Index Fund will invest in liquid,
| | | | |
488 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
short-term instruments. The FlexShares Core Select Bond Fund may also invest either directly or through its Underlying Funds in MBS, including TBA transactions.
Mortgage Dollar Rolls
The FlexShares Disciplined Duration MBS Index Fund, the FlexShares Ultra-Short Income Fund and the FlexShares Core Select Bond Fund (directly or through its Underlying Funds) may enter into mortgage dollar roll transactions. A mortgage dollar roll involves the sale by the Fund of securities for delivery in the future (generally within 30 days). The Fund simultaneously contracts with the same counterparty to repurchase substantially similar (same type, coupon and maturity) but not identical securities on a specified future date. During the roll period, the Fund will not be entitled to accrue interest and receive principal payments on the securities sold. However, the Fund benefits to the extent of any difference between (a) the price received for the securities sold and (b) the lower forward price for the future purchase and/or fee income plus the interest earned on the cash proceeds of the securities sold. Successful use of mortgage dollar rolls depends upon the Investment Adviser’s ability to predict correctly interest rates and mortgage prepayments. The use of this technique may diminish the investment performance of the Fund compared with what such performance would have been without the use of mortgage dollar rolls.
For financial reporting and tax purposes, a Fund treats mortgage dollar rolls as two separate transactions: one involving the purchase of a security and a separate transaction involving a sale. The Fund currently does not intend to enter into mortgage dollar rolls that are accounted for as financing and does not treat them as borrowings.
Repurchase Agreements
To the extent consistent with its investment policies, each Fund may enter into repurchase agreements under which it purchases securities (collateral) for cash from a seller and agrees to resell those securities to the same seller within a specified time at a specified price. During the term of a repurchase agreement, the market value of the underlying collateral, including accrued interest, is required to equal or exceed the market value of the repurchase agreement. The
underlying collateral for tri-party repurchase agreements is held in accounts at JPMorgan Chase, the Fund’s custodian, and is not reflected in the assets of the Funds, at the Bank of New York or JPMorgan Chase which, in turn, holds securities through the book-entry system at the Federal Reserve Bank of New York. The Fund is subject to credit risk on repurchase agreements to the extent that the counterparty fails to perform under the agreement and the value of the collateral received falls below the agreed repurchase price.
The Northern Trust Company, the parent of NTI, currently is a party to various Master Repurchase Agreements with a number of different counterparties, and acts as agent on behalf of various disclosed principals, including the Funds and various other accounts managed by NTI, in entering into repurchase agreements under the Master Repurchase Agreements. NTI administers and manages these repurchase agreements in accordance with and as part of its duties under its investment advisory agreement with the Funds and does not collect any additional fees from the Funds for such services. As of October 31, 2023, none of the Funds presented in these financial statements had repurchase agreements outstanding except as discussed below.
As of October 31, 2023, the FlexShares US Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® US ESG Select Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Core Select Bond Fund invested cash collateral for loans of portfolio securities in repurchase agreements, as reflected in the respective Schedule of Investments under the caption “Securities Lending Reinvestments.”
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 489 | |
Notes to the Financial Statements (cont.)
Securities Lending
Each Fund may lend securities to banks, brokers and dealers or other qualified institutions. In exchange, the Fund is required to receive minimum initial collateral value as follows:
| | | | |
Type of Loan | | Minimum Initial Collateral Requirement | |
| |
U.S. dollar denominated securities secured by U.S. dollar denominated government securities or cash collateral | | | 102 | % |
| |
U.S. dollar denominated securities secured by non-U.S. dollar denominated government securities or cash collateral | | | 105 | % |
| |
Non-U.S. dollar denominated securities secured by government securities or cash collateral in the same denomination as the lent securities | | | 102 | % |
| |
Non-U.S. dollar denominated securities secured by government securities or cash collateral in the different denomination from the lent securities | | | 105 | % |
| |
U.S. dollar and Non-U.S. dollar denominated securities secured by equity securities collateral | | | 105 | % |
The collateral is maintained thereafter, at a value equal to at least 100% of the value of the securities loaned. The collateral amount is valued at the beginning of each business day and is compared to the market value of the loaned securities from the prior business day to determine if additional collateral is required. If additional collateral is required, a request is sent to the borrower.
Securities lending may represent no more than one-third of the value of a Fund’s total assets (including the loan collateral). JPMorgan Chase Bank, N.A. (the “Securities Lending Agent”) serves as the securities lending agent for the securities lending program of a Fund.
Collateral for loans of portfolio securities made by a Fund may consist of cash, cash equivalents, securities issued or guaranteed by the U.S. government or foreign governments or its agencies (or any combination thereof). Any cash collateral received by the Fund in connection with these
loans may be invested in a variety of short-term investments, either directly or indirectly through money market portfolios. The market value of securities on loan and the value of investments made with cash collateral received are disclosed in the Schedules of Investments. Securities lending income includes income from the securities lending program recorded when earned from the Securities Lending Agent and any fees charged to borrowers less expenses associated with the loan. The net amount is reflected in the Statement of Operations under “Securities lending income (net of fees).” 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 returned by the Fund, on the next business day.
When a Fund lends its securities, it will continue to receive payments equal to the dividends and interest paid on the securities loaned and simultaneously may earn interest on the investment of the cash collateral.
A Fund will have the right to terminate a loan at any time and recall the loaned securities within the normal and customary settlement time for securities transactions. A Fund does not have the right to vote securities on loan, but can terminate the loan and regain the right to vote if a material event affecting the securities occurred. A borrower might become insolvent or refuse to honor its obligation to return the securities. In the event of a default by a borrower with respect to any loan, the Securities Lending Agent will exercise any and all remedies provided under the applicable borrower agreement. These remedies include purchasing replacement securities for the Fund by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If the proceeds from the collateral are less than the purchase cost of the replacement securities, the Securities Lending Agent is responsible for such shortfall, subject to certain limitations that are set forth in detail in the Securities Lending Agency Agreement. In this event, a Fund could experience delays in recovering its securities and possibly may incur a capital loss. Each Fund will be responsible for any loss that might result from its investment of the cash collateral it receives from a borrower.
| | | | |
490 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
In accordance with guidance presented in FASB Accounting Standard Update (“ASU”) 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures, liabilities under the outstanding securities lending transactions as of October 31, 2023, which were comprised of cash, were as follows:
| | | | |
Fund | | | |
| |
FlexShares® US Quality Low Volatility Index Fund | | $ | 2,683,994 | |
| |
FlexShares® Morningstar US Market Factor Tilt Index Fund | | | 167,151,893 | |
| |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 8,760,452 | |
| |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | | | 677,315 | |
| |
FlexShares® STOXX® US ESG Select Index Fund | | | 97,159 | |
| |
FlexShares® STOXX® Global ESG Select Index Fund | | | 857,504 | |
| |
FlexShares® Morningstar Global Upstream Natural Resources Index Fund | | | 303,760,945 | |
| |
FlexShares® STOXX® Global Broad Infrastructure Index Fund | | | 40,144,363 | |
| |
FlexShares® Global Quality Real Estate Index Fund | | | 2,704,220 | |
| |
FlexShares® Quality Dividend Index Fund | | | 129,448,662 | |
| |
FlexShares® Quality Dividend Defensive Index Fund | | | 18,783,683 | |
| |
FlexShares® International Quality Dividend Index Fund | | | 2,149,574 | |
| |
FlexShares® International Quality Dividend Defensive Index Fund | | | 125,891 | |
| |
FlexShares® International Quality Dividend Dynamic Index Fund | | | 695,880 | |
| |
FlexShares® Core Select Bond Fund | | | 80,325 | |
As of October 31, 2023, the Securities Lending Agency Agreement does not permit the Funds to enforce a netting arrangement.
The cash collateral received from securities loaned as disclosed in the Statements of Assets and Liabilities is
collateralized by securities on loan as disclosed within the Schedules of Investments and such borrowings have maturities that are overnight and continuous.
Securities lending agreements may be subject to regulation as qualified financial contracts (“QFCs”). Regulations adopted by federal banking regulators under the Dodd-Frank Act, which took effect in 2019, require that certain QFCs with counterparties that are part of U.S. or foreign global systemically important banking organizations be amended to include contractual restrictions on close-out and cross-default rights. If a covered counterparty of a Fund or certain of the covered counterparty’s affiliates were to become subject to certain insolvency proceedings, the Fund may be temporarily unable to exercise certain default rights, and the QFC may be transferred to another entity. These requirements may impact a Fund’s credit and counterparty risks. The remaining maturities of the securities lending transactions are considered overnight and continuous.
Derivative Contracts
Futures Contracts
All of the Index Funds may invest in futures contracts to help track the price and yield performance of their Underlying Indexes. At the time a Fund enters into a futures contract, it is generally required to make a margin deposit with the custodian of a specified amount of liquid assets. Subsequent payments to be made or received by the Funds equal to the change in contract value are recorded as variation margin payable or receivable and offset in unrealized gains or losses. Futures are marked to market each day with the change in value reflected in the unrealized gains or losses. A Fund recognizes a realized gain or loss when a contract is closed or expires. The Statements of Operations reflect unrealized gains or losses on open futures contracts, as “Net change in unrealized appreciation (depreciation) on futures contracts”, and any realized gains (losses) on closed futures contracts as “Net realized gain (loss) from Expiration or closing of futures contracts”.
The FlexShares Core Select Bond Fund may take long or short positions in futures to manage the Fund’s exposure to interest rate risk. The Fund seeks to mitigate the potential impact of interest rates on the performance of bonds by
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 491 | |
Notes to the Financial Statements (cont.)
entering into short positions in U.S. Treasury futures or transactions in interest rate swaps. The Fund’s short positions in U.S. Treasury futures and interest rate swaps are not intended to mitigate credit spread risk or other factors influencing the price of bonds, which may have a greater impact than interest rates. In addition, when interest rates fall, long-only bond investments will perform better than the Fund’s investments. As of October 31, 2023, the FlexShares Core Select Bond Fund did not hold swaps.
As of October 31, 2023, the FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX® US ESG Select Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Core Select Bond Fund had open futures contracts.
The use of futures contracts involves, to varying degrees, elements of market and counterparty risk, which may exceed the amounts recognized in the Statements of Assets and Liabilities. Futures contracts present the following risks: imperfect correlation between the change in market value of a Fund’s securities and the price of futures contracts; the possible inability to close a futures contract when desired; losses due to unanticipated market movements, which potentially are unlimited; and the possible inability of NTI to correctly predict the direction of securities prices, interest
rates, currency exchange rates and other economic factors. Futures markets are highly volatile and the use of futures may increase the volatility of a Fund’s NAV. As a result of the low margin deposits normally required in futures trading, a relatively small price movement in a futures contract may result in substantial losses to a Fund. Futures contracts may be illiquid, and exchanges may limit fluctuations in futures contract prices during a single day. Foreign exchanges or boards of trade generally do not offer the same protection as U.S. exchanges.
Foreign Currency Translations
Values of investments denominated in foreign currencies are converted into U.S. dollars using the prevailing market rates on the date of valuation as quoted by one or more banks or dealers that make a two-way market in such currencies (or a data service provider based on quotations received from such banks or dealers). Any use of a rate different from the rates used by an Underlying Index’s index provider may affect the corresponding Index Fund’s ability to track its Underlying Index. The cost of purchases and proceeds from sales of investments, interest and dividend income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. “Net realized gain (loss) on foreign currency transactions” on the Statements of Operations include the effect of changes in exchange rates between trade date and settlement date on investment security transactions, foreign currency transactions and interest and dividends received, and the portion of foreign currency gains and losses related to fluctuation in exchange rates between the initial purchase trade date and subsequent sale trade date is included in “Net realized gain (loss) on investment in securities” on the Statements of Operations. Unrealized gains and losses on assets and liabilities, other than investments in securities, which result from changes in foreign currency exchange rates have been included in “Net change in unrealized appreciation (depreciation) on translation of other assets and liabilities denominated in foreign currencies” on the Statements of Operations.
Forward Foreign Currency Exchange Contracts
The FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low
| | | | |
492 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Ultra-Short Income Fund may enter into forward foreign currency exchange contracts to facilitate local settlements or to protect against currency exposure in connection with its distributions to shareholders. The FlexShares Ultra-Short Income Fund also may engage in forward foreign currency transactions for hedging purposes in order to protect against uncertainty in the level of future foreign currency exchange rates. The Funds, however, do not expect to engage in currency transactions for speculative purposes (e.g., for potential income or capital gain). All forward foreign currency exchange contracts held are “marked-to-market” daily at the applicable exchange rates and any resulting unrealized gains or losses are recorded. The Funds record realized gains or losses at the time the forward foreign currency exchange contract is offset by entering into a closing transaction or extinguished by delivery of the currency. The difference between the future foreign currency exchange rates at the date of entry into the contract and the rates at the reporting date are included in “Net change in unrealized appreciation (depreciation) on forward foreign currency contracts” in the Statements of Operations. Realized gains or losses, if any, are included in “Net realized gain (loss) from settlement of forward foreign currency contracts” in the Statements of Operations. Non-deliverable forward foreign currency exchange contracts are settled with the counterparty in U.S. Dollars without the delivery of foreign currency.
There are several risks associated with these contracts. One risk is the potential inability of counterparties to meet the terms of their contracts, and unanticipated movements in the value of a foreign currency relative to the U.S. dollar.
The contractual amounts of forward foreign currency exchange contracts do not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered. The Statements of Operations reflect (i) realized gains or losses, if any, in “Net realized gain (loss) from settlement of forward foreign currency contracts” and (ii) unrealized gains or losses in “Net change in unrealized appreciation (depreciation) on forward foreign currency contracts”. Forward foreign currency exchange contracts are privately negotiated transactions and can have substantial price volatility. As a result, they offer less protection against default by the other party than is available for instruments traded on an exchange. The institutions that deal in forward foreign currency exchange contracts are not required to continue to make markets in the currencies they trade, and these markets can experience periods of illiquidity.
As of October 31, 2023, the FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Morningstar® Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar® Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar® Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares International Quality Dividend Index Fund, and the FlexShares International Quality Dividend Dynamic Index Fund had open forward foreign currency contracts.
Offsetting of Financial Assets and Derivative Assets
The Funds’ accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International Swaps and Derivatives Association (ISDA) Master Agreement or similar agreement does not result in an offset of reported amounts of financial assets and financial liabilities in the Statements of Assets and Liabilities across transactions between the Fund and the applicable counterparty. In the event of a default, the agreement provides the right for the
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 493 | |
Notes to the Financial Statements (cont.)
non-defaulting party to liquidate the collateral and calculate the net exposure to the defaulting party or request additional collateral. The Funds’ right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which a specific master netting agreement counterparty is subject.
For financial reporting purposes, the Trust can offset financial assets and financial liabilities of the FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar® Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar® Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® Global
ESG Select Index Fund, FlexShares ESG & Climate Developed Market ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar® Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund and the FlexShares International Quality Dividend Dynamic Index Fund that are subject to master netting arrangements or similar agreements in the Statements of Assets and Liabilities. The following table presents the gross and net amounts of these assets and liabilities:
| | | | | | | | | | | | | | | | | | |
| | | | | | | Gross Amounts Not Offset in the Statement of Assets and Liabilities | | | | |
| | | | Gross Amounts of Assets presented in Statements of Assets and Liabilities | | | Financial Instruments | | | Cash Collateral Received | | | Net Amount | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | | Foreign Currency Contracts — Citibank NA | | $ | 1,083 | | | $ | (1,083) | | | $ | — | | | $ | — | |
| | Foreign Currency Contracts — Goldman Sachs & Co. | | | 137 | | | | — | | | | — | | | | 137 | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 17,132 | | | | (14,800) | | | | — | | | | 2,332 | |
| | Foreign Currency Contracts — Morgan Stanley | | | 3,734 | | | | — | | | | — | | | | 3,734 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 5,613 | | | | (974) | | | | — | | | | 4,639 | |
| | Total | | $ | 27,699 | | | $ | (16,857) | | | $ | — | | | $ | 10,842 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index | | Foreign Currency Contracts — BNP Paribas SA | | $ | 14,407 | | | $ | — | | | $ | — | | | $ | 14,407 | |
| | Total | | $ | 14,407 | | | $ | — | | | $ | — | | | $ | 14,407 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | | Foreign Currency Contracts — BNP Paribas SA | | $ | 222 | | | $ | (222) | | | $ | — | | | $ | — | |
| | Foreign Currency Contracts — Citibank NA | | | 2,031 | | | | — | | | | — | | | | 2,031 | |
| | Foreign Currency Contracts — Morgan Stanley | | | 3,918 | | | | — | | | | — | | | | 3,918 | |
| | Total | | $ | 6,171 | | | $ | (222) | | | $ | — | | | $ | 5,949 | |
FlexShares® STOXX® Global ESG Select Index Fund | | Foreign Currency Contracts — Citibank NA | | $ | 2,997 | | | $ | — | | | $ | — | | | $ | 2,997 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 1,563 | | | | — | | | | — | | | | 1,563 | |
| | Foreign Currency Contracts — UBS AG | | | 3,196 | | | | — | | | | — | | | | 3,196 | |
| | Total | | $ | 7,756 | | | $ | — | | | $ | — | | | $ | 7,756 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | Foreign Currency Contracts — BNP Paribas SA | | $ | 381 | | | $ | — | | | $ | — | | | $ | 381 | |
| | Foreign Currency Contracts — Citibank NA | | | 3,592 | | | | — | | | | — | | | | 3,592 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 1,497 | | | | (1,497) | | | | — | | | | — | |
| | Foreign Currency Contracts — UBS AG | | | 1,022 | | | | — | | | | — | | | | 1,022 | |
| | Total | | $ | 6,492 | | | $ | (1,497) | | | $ | — | | | $ | 4,995 | |
| | | | |
494 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | | | |
| | | | | | | Gross Amounts Not Offset in the Statement of Assets and Liabilities | | | | |
| | | | Gross Amounts of Assets presented in Statements of Assets and Liabilities | | | Financial Instruments | | | Cash Collateral Received | | | Net Amount | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund | | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | $ | 3 | | | $ | — | | | $ | — | | | $ | 3 | |
| | Total | | $ | 3 | | | $ | — | | | $ | — | | | $ | 3 | |
FlexShares® Morningstar Global Upstream Natural Resources Index | | Foreign Currency Contracts — Bank of Montreal | | $ | 14,861 | | | $ | — | | | $ | — | | | $ | 14,861 | |
| | Foreign Currency Contracts — BNP Paribas SA | | | 5,334 | | | | — | | | | — | | | | 5,334 | |
| | Foreign Currency Contracts — Citibank NA | | | 5,615 | | | | (5,615) | | | | — | | | | — | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 212,011 | | | | (212,011) | | | | — | | | | — | |
| | Foreign Currency Contracts — Morgan Stanley | | | 36,539 | | | | — | | | | — | | | | 36,539 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 531,529 | | | | (181,227) | | | | — | | | | 350,302 | |
| | Total | | $ | 805,889 | | | $ | (398,853) | | | $ | — | | | $ | 407,036 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund | | Foreign Currency Contracts — Bank of Montreal | | $ | 6,925 | | | $ | — | | | $ | — | | | $ | 6,925 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 71,922 | | | | — | | | | — | | | | 71,922 | |
| | Total | | $ | 78,847 | | | $ | — | | | $ | — | | | $ | 78,847 | |
FlexShares® Global Quality Real Estate Index Fund | | Foreign Currency Contracts — BNP Paribas SA | | $ | 434 | | | $ | — | | | $ | — | | | $ | 434 | |
| | Foreign Currency Contracts — Citibank NA | | | 14,797 | | | | — | | | | — | | | | 14,797 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 2,463 | | | | — | | | | — | | | | 2,463 | |
| | Total | | $ | 17,694 | | | $ | — | | | $ | — | | | $ | 17,694 | |
FlexShares® International Quality Dividend Index Fund | | Foreign Currency Contracts — Bank of Montreal | | $ | 12,982 | | | $ | — | | | $ | — | | | $ | 12,982 | |
| | Foreign Currency Contracts — BNP Paribas SA | | | 21,044 | | | | (2,190) | | | | — | | | | 18,854 | |
| | Foreign Currency Contracts — Citibank NA | | | 23,494 | | | | (23,494) | | | | — | | | | — | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 25,369 | | | | — | | | | — | | | | 25,369 | |
| | Foreign Currency Contracts — Morgan Stanley | | | 59,766 | | | | — | | | | — | | | | 59,766 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 69,077 | | | | (69,077) | | | | — | | | | — | |
| | Foreign Currency Contracts — UBS AG | | | 863 | | | | (863) | | | | — | | | | — | |
| | Total | | $ | 212,595 | | | $ | (95,624) | | | $ | — | | | $ | 116,971 | |
FlexShares® International Quality Dividend Dynamic Index Fund | | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | $ | 5,506 | | | $ | — | | | $ | — | | | $ | 5,506 | |
| | Total | | $ | 5,506 | | | $ | — | | | $ | — | | | $ | 5,506 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 495 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | | | |
| | | | | | | Gross Amounts Not Offset in the Statement of Assets and Liabilities | | | | |
| | | | Gross Amounts of Liabilities presented in Statements of Assets and Liabilities | | | Financial Instruments | | | Cash Collateral Pledged | | | Net Amount | |
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | | | | | | | | | | | | | | | | | | |
| | Foreign Currency Contracts — BNP Paribas SA | | $ | 113 | | | $ | — | | | $ | — | | | $ | 113 | |
| | Foreign Currency Contracts — Citibank NA | | | 2,757 | | | | (1,083) | | | | — | | | | 1,674 | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 14,800 | | | | (14,800) | | | | — | | | | — | |
| | Foreign Currency Contracts —Toronto-Dominion Bank (The) | | | 974 | | | | (974) | | | | — | | | | — | |
| | Total | | $ | 18,644 | | | $ | (16,857) | | | $ | — | | | $ | 1,787 | |
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index | | Foreign Currency Contracts — Citibank NA | | $ | 13,108 | | | $ | — | | | $ | — | | | $ | 13,108 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 31,190 | | | | — | | | | — | | | | 31,190 | |
| | Total | | $ | 44,298 | | | $ | — | | | $ | — | | | $ | 44,298 | |
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | | Foreign Currency Contracts — BNP Paribas SA | | $ | 333 | | | $ | (222) | | | $ | — | | | $ | 111 | |
| | Total | | $ | 333 | | | $ | (222) | | | $ | — | | | $ | 111 | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | Foreign Currency Contracts — Goldman Sachs & Co. | | $ | 585 | | | $ | — | | | $ | — | | | $ | 585 | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 317 | | | | — | | | | — | | | | 317 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 2,392 | | | | (1,497) | | | | — | | | | 895 | |
| | Total | | $ | 3,294 | | | $ | (1,497) | | | $ | — | | | $ | 1,797 | |
FlexShares® Morningstar Global Upstream Natural Resources Index | | Foreign Currency Contracts — Citibank NA | | $ | 197,390 | | | $ | (5,615) | | | $ | — | | | $ | 191,775 | |
| | Foreign Currency Contracts — Goldman Sachs & Co. | | | 43,664 | | | | — | | | | — | | | | 43,664 | |
| | Foreign Currency Contracts — JPMorgan Chase Bank NA | | | 405,608 | | | | (212,011) | | | | — | | | | 193,597 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 181,227 | | | | (181,227) | | | | — | | | | — | |
| | Total | | $ | 827,889 | | | $ | (398,853) | | | $ | — | | | $ | 429,036 | |
FlexShares® STOXX® Global Broad Infrastructure Index Fund | | Foreign Currency Contracts — JPMorgan Chase Bank NA | | $ | 14,821 | | | $ | — | | | $ | — | | | $ | 14,821 | |
| | Total | | $ | 14,821 | | | $ | — | | | $ | — | | | $ | 14,821 | |
FlexShares® Global Quality Real Estate Index Fund | | Foreign Currency Contracts — UBS AG | | $ | 20,492 | | | $ | — | | | $ | — | | | $ | 20,492 | |
| | Total | | $ | 20,492 | | | $ | — | | | $ | — | | | $ | 20,492 | |
FlexShares® International Quality Dividend Index Fund | | Foreign Currency Contracts — BNP Paribas SA | | $ | 2,190 | | | $ | (2,190) | | | $ | — | | | $ | — | |
| | Foreign Currency Contracts — Citibank NA | | | 30,577 | | | | (23,494) | | | | — | | | | 7,083 | |
| | Foreign Currency Contracts — Toronto-Dominion Bank (The) | | | 81,369 | | | | (69,077) | | | | — | | | | 12,292 | |
| | Foreign Currency Contracts — UBS AG | | | 21,469 | | | | (863) | | | | — | | | | 20,606 | |
| | Total | | $ | 135,605 | | | $ | (95,624) | | | $ | — | | | $ | 39,981 | |
FlexShares® International Quality Dividend Dynamic Index Fund | | Foreign Currency Contracts — Citibank NA | | $ | 1,549 | | | $ | — | | | $ | — | | | $ | 1,549 | |
| | Total | | $ | 1,549 | | | $ | — | | | $ | — | | | $ | 1,549 | |
| | | | |
496 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
The following tables indicate the location of derivative-related items on the Statements of Assets and Liabilities as well as the effect of derivative instruments on the Statements of Operations during the reporting period.
Fair Value of Derivative Instruments as of October 31, 2023
| | | | | | | | |
Derivatives by risk type | | Statements of Assets and Liabilities Location | | Fund | | Value | |
| | | |
Equity Index Futures Contracts | | Assets — Unrealized appreciation on futures contracts* | | FlexShares US Quality Low Volatility Index Fund | | $ | 2,310 | |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares US Quality Low Volatility Index Fund | | | (345 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | (79,276 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 27,699 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | (18,644 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Emerging Markets Quality Low Volatility Index Fund | | | (12,537 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Morningstar US Market Factor Tilt Index Fund | | | (730,606 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | (329,765 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 14,407 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | (44,298 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | (51,792 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 6,171 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | (333 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares US Quality Large Cap Index Fund | | | (65,571 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares STOXX® US ESG Select Index Fund | | | (116,118 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares STOXX® Global ESG Select Index Fund | | | (90,109 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares STOXX® Global ESG Select Index Fund | | | 7,756 | |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares ESG & Climate US Large Cap Core Index Fund | | | (17,721 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 497 | |
Notes to the Financial Statements (cont.)
| | | | | | | | |
Derivatives by risk type | | Statements of Assets and Liabilities Location | | Fund | | Value | |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | $ | (21,494 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 6,492 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | (3,294 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares ESG & Climate Emerging Markets Core Index Fund | | | (3,512 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 3 | |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | (1,738,108 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 805,889 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | (827,889 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares STOXX® Global Broad Infrastructure Index Fund | | | (920,022 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 78,847 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares STOXX® Global Broad Infrastructure Index Fund | | | (14,821 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Global Quality Real Estate Index Fund | | | (239,027 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares Global Quality Real Estate Index Fund | | | 17,694 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares Global Quality Real Estate Index Fund | | | (20,492 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Quality Dividend Index Fund | | | (55,107 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Quality Dividend Defensive Index Fund | | | (70,583 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares International Quality Dividend Index Fund | | | (505,171 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares International Quality Dividend Index Fund | | | 212,595 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares International Quality Dividend Index Fund | | | (135,605 | ) |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares International Quality Dividend Defensive Index Fund | | | (74,486 | ) |
| | | | |
498 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | |
Derivatives by risk type | | Statements of Assets and Liabilities Location | | Fund | | Value | |
| | | |
Equity Index Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares International Quality Dividend Dynamic Index Fund | | $ | (62,745 | ) |
| | | |
Foreign Currency Contracts | | Assets — Unrealized appreciation on forward foreign currency contracts | | FlexShares International Quality Dividend Dynamic Index Fund | | | 5,506 | |
| | | |
Foreign Currency Contracts | | Liabilities — Unrealized depreciation on forward foreign currency contracts | | FlexShares International Quality Dividend Dynamic Index Fund | | | (1,549 | ) |
| | | |
Interest Rate Futures Contracts | | Liabilities — Unrealized depreciation on futures contracts* | | FlexShares Core Select Bond Fund | | | (37,249 | ) |
* | Includes cumulative appreciation/depreciation on futures contracts as reported in the Schedule of Investments. Current day’s variation margin is reported within the Statement of Assets and Liabilities for futures contracts. |
The Effect of Derivative Instruments on the Statements of Operations for the Period Ended October 31, 2023
| | | | | | | | | | | | |
Derivatives by risk type | | Location of Gain or (Loss) on Derivatives on the Statements of Operations | | Fund | | Realized Gain or (Loss) on Derivatives | | | Change in Unrealized Appreciation or (Depreciation) on Derivatives | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares US Quality Low Volatility Index Fund | | $ | 82,116 | | | $ | (4,832 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 202,228 | | | | (36,753 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | (1,334 | ) | | | (5,891 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Emerging Markets Quality Low Volatility Index Fund | | | (5,586 | ) | | | (4,868 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Emerging Markets Quality Low Volatility Index Fund | | | (8 | ) | | | — | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Morningstar US Market Factor Tilt Index Fund | | | 292,338 | | | | (1,016,036 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 499 | |
Notes to the Financial Statements (cont.)
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Derivatives by risk type | | Location of Gain or (Loss) on Derivatives on the Statements of Operations | | Fund | | Realized Gain or (Loss) on Derivatives | | | Change in Unrealized Appreciation or (Depreciation) on Derivatives | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | $ | 1,184,364 | | | $ | (391,983 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | (47,567 | ) | | | 21,599 | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | (15,728 | ) | | | 125,329 | |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 18,704 | | | | 1,326 | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares US Quality Large Cap Index Fund | | | 20,757 | | | | (17,315 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares STOXX® US ESG Select Index Fund | | | 112,767 | | | | (80,050 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares STOXX® Global ESG Select Index Fund | | | 140,996 | | | | (54,222 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares STOXX® Global ESG Select Index Fund | | | 957 | | | | 3,160 | |
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Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares ESG & Climate US Large Cap Core Index Fund | | | 23,434 | | | | (12,103 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 34,251 | | | | (16,718 | ) |
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500 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | |
Derivatives by risk type | | Location of Gain or (Loss) on Derivatives on the Statements of Operations | | Fund | | Realized Gain or (Loss) on Derivatives | | | Change in Unrealized Appreciation or (Depreciation) on Derivatives | |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | $ | 343 | | | $ | 408 | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares ESG & Climate Emerging Markets Core Index Fund | | | (1,316 | ) | | | 3,300 | |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 7 | | | | 3 | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | (1,699,233 | ) | | | (1,694,521 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | (492,100 | ) | | | 266,510 | |
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Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 1,789,383 | | | | (921,993 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 53,105 | | | | 112,999 | |
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Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Global Quality Real Estate Index Fund | | | 425,518 | | | | (187,225 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares Global Quality Real Estate Index Fund | | | 112,370 | | | | (16,487 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 501 | |
Notes to the Financial Statements (cont.)
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Derivatives by risk type | | Location of Gain or (Loss) on Derivatives on the Statements of Operations | | Fund | | Realized Gain or (Loss) on Derivatives | | | Change in Unrealized Appreciation or (Depreciation) on Derivatives | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Quality Dividend Index Fund | | $ | 357,938 | | | $ | (101,537 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Quality Dividend Defensive Index Fund | | | 154,895 | | | | (31,829 | ) |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares International Quality Dividend Index Fund | | | 926,785 | | | | (180,632 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares International Quality Dividend Index Fund | | | (74,191 | ) | | | 93,106 | |
| | | | |
Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares International Quality Dividend Defensive Index Fund | | | 68,091 | | | | (41,044 | ) |
| | | | |
Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares International Quality Dividend Defensive Index Fund | | | (41,670 | ) | | | (18,270 | ) |
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Equity Index Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares International Quality Dividend Dynamic Index Fund | | | 234,106 | | | | (24,231 | ) |
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Foreign Currency Contracts | | Net realized gain (loss) on Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | | FlexShares International Quality Dividend Dynamic Index Fund | | | (4,559 | ) | | | (6,064 | ) |
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Interest Rate Futures Contracts | | Net realized gain (loss) on Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | | FlexShares Core Select Bond Fund | | | (145,963 | ) | | | (33,289 | ) |
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502 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
At October 31, 2023, the volume of derivative activities, which represents activities throughout the period, was as follows:
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| | Foreign Exchange Contracts | | | Equity Contracts | | | Interest Rate future | |
Fund | | Number of Trades | | | Average Notional Amount | | | Number of Trades Long | | | Average Notional Balance Long | | | Number of Trades Short | | | Average Notional Balance Short | | | Number of Trades Long | | | Average Notional Balance Long | | | Number of Trades Short | | | Average Notional Balance Short | |
| | | | | | | | | | |
FlexShares US Quality Low Volatility Index Fund | | | — | | | $ | — | | | | 61 | | | $ | 211,311 | | | | — | | | $ | — | | | | — | | | $ | — | | | | — | | | $ | — | |
| | | | | | | | | | |
FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | | | 142 | | | | 82,562 | | | | 43 | | | | 217,938 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 1 | | | | 6,395 | | | | 28 | | | | 68,947 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | — | | | | — | | | | 138 | | | | 699,128 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 68 | | | | 582,710 | | | | 177 | | | | 434,626 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 55 | | | | 172,460 | | | | 80 | | | | 247,106 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares US Quality Large Cap Index Fund | | | — | | | | — | | | | 36 | | | | 262,845 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares STOXX US ESG Select Index Fund | | | — | | | | — | | | | 24 | | | | 446,717 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares STOXX Global ESG Select Index Fund | | | 24 | | | | 129,587 | | | | 58 | | | | 218,899 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares® ESG & Climate US Large Cap Core Index Fund | | | — | | | | — | | | | 27 | | | | 77,960 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | | | 155 | | | | 37,651 | | | | 37 | | | | 111,159 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 3 | | | | 4,756 | | | | 4 | | | | 49,141 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 238 | | | | 1,615,312 | | | | 459 | | | | 1,174,942 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares STOXX Global Broad Infrastructure Index Fund | | | 12 | | | | 3,557,814 | | | | 253 | | | | 732,367 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Global Quality Real Estate Index Fund | | | 99 | | | | 184,113 | | | | 117 | | | | 351,831 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Quality Dividend Index Fund | | | — | | | | — | | | | 113 | | | | 815,181 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Quality Dividend Defensive Index Fund | | | — | | | | — | | | | 49 | | | | 513,980 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Quality Dividend Dynamic Index Fund | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 503 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Foreign Exchange Contracts | | | Equity Contracts | | | Interest Rate future | |
Fund | | Number of Trades | | | Average Notional Amount | | | Number of Trades Long | | | Average Notional Balance Long | | | Number of Trades Short | | | Average Notional Balance Short | | | Number of Trades Long | | | Average Notional Balance Long | | | Number of Trades Short | | | Average Notional Balance Short | |
| | | | | | | | | | |
FlexShares International Quality Dividend Index Fund | | | 178 | | | | 588,989 | | | | 264 | | | | 395,702 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares International Quality Dividend Defensive Index Fund | | | 46 | | | | 61,651 | | | | 51 | | | | 128,704 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 46 | | | | 92,406 | | | | 82 | | | | 202,994 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | |
FlexShares Core Select Bond Fund | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 7 | | | | 6,958,368 | | | | — | | | | — | |
Taxes and Distributions
Each Fund has qualified and intends to continue to qualify as a regulated investment company by complying with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, which includes distributing substantially all of its net investment income and net capital gains to shareholders. Accordingly, no provision for federal and state income taxes is required in the financial statements.
As of October 31, 2023, management of the Funds has reviewed all open tax years and major jurisdictions and concluded that there is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken in future tax returns. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next 12 months. On an ongoing basis management will monitor the tax positions taken to determine if adjustment to conclusions are necessary based on factors including but not limited to further implementation on guidance expected from FASB and on-going analysis of tax law, regulation, and interpretations thereof.
Dividends from net investment income, including any net foreign currency gains, are generally declared and paid by each Fund according to the following schedule:
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Fund | | Declared And Paid Monthly | | | Declared And Paid Quarterly | |
| | |
FlexShares US Quality Low Volatility Index Fund | | | | | | | x | |
| | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | | | | | x | |
| | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | | | | | x | |
| | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | | | | | x | |
| | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | | | | | x | |
| | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | | | | | x | |
| | |
FlexShares US Quality Large Cap Index Fund | | | | | | | x | |
| | |
FlexShares STOXX® US ESG Select Index Fund | | | | | | | x | |
| | |
FlexShares STOXX® Global ESG Select Index Fund | | | | | | | x | |
| | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | | | | | x | |
| | | | |
504 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
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Fund | | Declared And Paid Monthly | | | Declared And Paid Quarterly | |
| | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | | | | | x | |
| | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | | | | | x | |
| | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | | | | | x | |
| | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | | | | | x | |
| | |
FlexShares Global Quality Real Estate Index Fund | | | | | | | x | |
| | |
FlexShares Real Assets Allocation Index Fund | | | | | | | x | |
| | |
FlexShares Quality Dividend Index Fund | | | | | | | x | |
| | |
FlexShares Quality Dividend Defensive Index Fund | | | | | | | x | |
| | |
FlexShares International Quality Dividend Index Fund | | | | | | | x | |
| | |
FlexShares International Quality Dividend Defensive Index Fund | | | | | | | x | |
| | |
FlexShares International Quality Dividend Dynamic Index Fund | | | | | | | x | |
| | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | x | | | | | |
| | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | x | | | | | |
| | |
FlexShares Disciplined Duration MBS Index Fund | | | x | | | | | |
| | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | x | | | | | |
| | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | x | | | | | |
| | |
FlexShares High Yield Value-Scored Bond Index Fund | | | x | | | | | |
| | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | x | | | | | |
| | |
FlexShares Ultra-Short Income Fund | | | x | | | | | |
| | |
FlexShares Core Select Bond Fund | | | x | | | | | |
Distribution of net realized securities gains, if any, generally are distributed at least annually. The Trust reserves the right to declare special distributions if, in its reasonable discretion, such action is necessary or advisable to improve tracking error, to preserve its status as a regulated investment company or to avoid imposition of income or excise taxes on undistributed income or realized gains. Tracking error is a measurement of how much the return on a portfolio deviates from the return on its benchmark index.
Dividends and securities gains distributions are distributed in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The amount of distributions from net investment income and net realized gains are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences (e.g., wash sales) do not require a reclassification. The Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes. The Funds’ tax year end is October 31st and the tax character of current year distributions and current components of accumulated earnings (deficit) will be determined at the end of the current tax year.
Temporary differences are generally due to different book and tax treatments for the timing of the recognition of gains and losses on certain investment transactions, mark to market of forward foreign currency contracts, mark to market of futures contracts, mark to market of passive foreign investment companies (“PFICs”), non-taxable special dividends, wash sale loss deferrals and capital loss carryforward.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 505 | |
Notes to the Financial Statements (cont.)
Permanent differences, primarily due to gain (loss) on in-kind redemptions, paydown loss reclassification, foreign currency gains and losses, forward foreign currency gains and losses, PFICs gains and losses, non-taxable special dividends, investments in partnerships, taxable over-distributions, foreign capital gains tax reclassification, perpetual bonds and equalization as of October 31, 2023 (the Funds’ tax year end), among the Funds’ components of net assets are as follows:
| | | | | | | | | | | | |
Fund | | Accumulated undistributed net investment income (loss) | | | Accumulated net realized gain (loss) on investments | | | Paid in capital | |
| | | |
FlexShares US Quality Low Volatility Index Fund* | | $ | (13,945 | ) | | $ | (11,001,162 | ) | | $ | 11,015,107 | |
| | | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund* | | | 33,327 | | | | (970,745 | ) | | | 937,418 | |
| | | |
FlexShares Emerging Markets Quality Low Volatility Index Fund* | | | (55,239 | ) | | | 58,099 | | | | (2,860 | ) |
| | | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 204,975 | | | | (68,274,121 | ) | | | 68,069,146 | |
| | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 1,030,391 | | | | (6,160,567 | ) | | | 5,130,176 | |
| | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 1,819,060 | | | | (2,198,699 | ) | | | 379,639 | |
| | | |
FlexShares US Quality Large Cap Index Fund | | | (17,009 | ) | | | (3,338,471 | ) | | | 3,355,480 | |
| | | |
FlexShares STOXX® US ESG Select Index Fund | | | (19,984 | ) | | | (7,383,819 | ) | | | 7,403,803 | |
| | | |
FlexShares STOXX® Global ESG Select Index Fund | | | 74,021 | | | | (3,850,325 | ) | | | 3,776,304 | |
| | | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | (85 | ) | | | (357,942 | ) | | | 358,027 | |
| | | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | (8,949 | ) | | | 8,949 | | | | — | |
| | | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 9,473 | | | | (9,473 | ) | | | — | |
| | | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | (309,290 | ) | | | (12,936,571 | ) | | | 13,245,861 | |
| | | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | (563,031 | ) | | | (118,403,721 | ) | | | 118,966,752 | |
| | | |
FlexShares Global Quality Real Estate Index Fund | | | 641,884 | | | | (4,049,278 | ) | | | 3,407,394 | |
| | | |
FlexShares Real Assets Allocation Index Fund | | | 2,105 | | | | 1,355,879 | | | | (1,357,984 | ) |
| | | |
FlexShares Quality Dividend Index Fund | | | 135,612 | | | | (152,576,779 | ) | | | 152,441,167 | |
| | | |
FlexShares Quality Dividend Defensive Index Fund | | | (24,320 | ) | | | (26,165,774 | ) | | | 26,190,094 | |
| | | |
FlexShares International Quality Dividend Index Fund | | | 1,502,180 | | | | (4,627,667 | ) | | | 3,125,487 | |
| | | |
FlexShares International Quality Dividend Defensive Index Fund | | | 13,656 | | | | (1,073,213 | ) | | | 1,059,557 | |
| | | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 518,087 | | | | (5,166,502 | ) | | | 4,648,415 | |
| | | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | — | | | | 11,218,790 | | | | (11,218,790 | ) |
| | | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | — | | | | 5,873,720 | | | | (5,873,720 | ) |
| | | |
FlexShares Disciplined Duration MBS Index Fund | | | 532,189 | | | | (532,189 | ) | | | — | |
| | | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 105,963 | | | | (105,963 | ) | | | — | |
| | | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 4,223 | | | | (4,223 | ) | | | — | |
| | | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 174,353 | | | | (174,353 | ) | | | — | |
| | | | |
506 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | |
Fund | | Accumulated undistributed net investment income (loss) | | | Accumulated net realized gain (loss) on investments | | | Paid in capital | |
| | | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | $ | 13,983 | | | $ | (13,983 | ) | | $ | — | |
| | | |
FlexShares Ultra-Short Income Fund | | | (67,633 | ) | | | 67,633 | | | | — | |
| | | |
FlexShares Core Select Bond Fund | | | 50,923 | | | | 1,258,404 | | | | (1,309,327 | ) |
The tax character of distributions paid for the tax year ended October 31, 2023, and October 31, 2022, were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
Fund | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | |
FlexShares US Quality Low Volatility Index Fund | | $ | 3,156,833 | | | $ | — | | | $ | — | | | $ | 3,156,833 | | | $ | 2,196,287 | | | $ | — | | | $ | — | | | $ | 2,196,287 | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 2,014,225 | | | | — | | | | — | | | | 2,014,225 | | | | 2,140,729 | | | | — | | | | — | | | | 2,140,729 | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 436,593 | | | | — | | | | — | | | | 436,593 | | | | 416,284 | | | | — | | | | 24,777 | | | | 441,061 | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 21,821,054 | | | | — | | | | — | | | | 21,821,054 | | | | 22,299,297 | | | | — | | | | — | | | | 22,299,297 | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 13,198,440 | | | | — | | | | — | | | | 13,198,440 | | | | 22,504,833 | | | | — | | | | 992,999 | | | | 23,497,832 | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 7,099,686 | | | | — | | | | — | | | | 7,099,686 | | | | 12,431,512 | | | | — | | | | — | | | | 12,431,512 | |
FlexShares US Quality Large Cap Index Fund | | | 1,897,433 | | | | — | | | | — | | | | 1,897,433 | | | | 1,808,374 | | | | — | | | | — | | | | 1,808,374 | |
FlexShares STOXX® US ESG Select Index Fund | | | 2,147,796 | | | | — | | | | — | | | | 2,147,796 | | | | 2,266,829 | | | | — | | | | — | | | | 2,266,829 | |
FlexShares STOXX® Global ESG Select Index Fund | | | 2,604,964 | | | | — | | | | — | | | | 2,604,964 | | | | 3,114,461 | | | | — | | | | — | | | | 3,114,461 | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 460,917 | | | | — | | | | — | | | | 460,917 | | | | 128,991 | | | | 706 | | | | — | | | | 129,697 | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 958,970 | | | | — | | | | — | | | | 958,970 | | | | 406,987 | | | | — | | | | — | | | | 406,987 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 507 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
Fund | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | |
FlexShares ESG & Climate Emerging Markets Core Index Fund* | | $ | 104,863 | | | $ | — | | | $ | — | | | $ | 104,863 | | | $ | 65,664 | | | $ | — | | | $ | — | | | $ | 65,664 | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 217,789,649 | | | | — | | | | — | | | | 217,789,649 | | | | 349,767,759 | | | | — | | | | — | | | | 349,767,759 | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 54,907,766 | | | | — | | | | — | | | | 54,907,766 | | | | 71,164,043 | | | | — | | | | — | | | | 71,164,043 | |
FlexShares Global Quality Real Estate Index Fund | | | 8,872,134 | | | | — | | | | — | | | | 8,872,134 | | | | 12,433,295 | | | | — | | | | 212,283 | | | | 12,645,578 | |
FlexShares Real Assets Allocation Index Fund | | | 512,404 | | | | — | | | | — | | | | 512,404 | | | | 1,056,448 | | | | — | | | | — | | | | 1,056,448 | |
FlexShares Quality Dividend Index Fund | | | 36,041,105 | | | | — | | | | — | | | | 36,041,105 | | | | 36,901,147 | | | | — | | | | — | | | | 36,901,147 | |
FlexShares Quality Dividend Defensive Index Fund | | | 7,830,976 | | | | — | | | | — | | | | 7,830,976 | | | | 9,019,363 | | | | — | | | | — | | | | 9,019,363 | |
FlexShares International Quality Dividend Index Fund | | | 25,465,739 | | | | — | | | | — | | | | 25,465,739 | | | | 29,536,094 | | | | — | | | | — | | | | 29,536,094 | |
FlexShares International Quality Dividend Defensive Index Fund | | | 1,463,869 | | | | — | | | | — | | | | 1,463,869 | | | | 2,940,092 | | | | — | | | | — | | | | 2,940,092 | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 4,043,930 | | | | — | | | | — | | | | 4,043,930 | | | | 4,368,329 | | | | — | | | | — | | | | 4,368,329 | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 70,475,144 | | | | — | | | | — | | | | 70,475,144 | | | | 131,367,411 | | | | — | | | | 2,470,987 | | | | 133,838,398 | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 25,865,870 | | | | — | | | | — | | | | 25,865,870 | | | | 53,319,431 | | | | — | | | | 769,089 | | | | 54,088,520 | |
FlexShares Disciplined Duration MBS Index Fund | | | 2,711,658 | | | | — | | | | — | | | | 2,711,658 | | | | 2,906,209 | | | | — | | | | — | | | | 2,906,209 | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 8,908,201 | | | | — | | | | — | | | | 8,908,201 | | | | 6,279,015 | | | | 2,010,194 | | | | — | | | | 8,289,209 | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 1,709,535 | | | | — | | | | — | | | | 1,709,535 | | | | 2,152,418 | | | | 685,037 | | | | — | | | | 2,837,455 | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 93,229,360 | | | | — | | | | — | | | | 93,229,360 | | | | 55,009,030 | | | | 1,007,533 | | | | — | | | | 56,016,563 | |
| | | | |
508 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Year Ended October 31, 2023 | | | Year Ended October 31, 2022 | |
Fund | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | | | Distributions paid from ordinary income | | | Distributions paid from net long term capital gains | | | Tax Return of Capital | | | Total Distributions | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | $ | 1,318,208 | | | $ | — | | | $ | — | | | $ | 1,318,208 | | | $ | 1,093,741 | | | $ | — | | | $ | — | | | $ | 1,093,741 | |
FlexShares Ultra-Short Income Fund | | | 38,566,601 | | | | — | | | | — | | | | 38,566,601 | | | | 7,279,652 | | | | 627,909 | | | | — | | | | 7,907,561 | |
FlexShares Core Select Bond Fund | | | 5,547,838 | | | | — | | | | — | | | | 5,547,838 | | | | 3,352,156 | | | | — | | | | — | | | | 3,352,156 | |
* | Commencement of operations on April 20, 2022 |
As of October 31, 2023, the components of accumulated earnings (deficit) on a tax basis were as follows:
| | | | | | | | | | | | | | | | |
Fund | | Undistributed Ordinary Income | | | Undistributed Long-Term Capital Gains | | | Accumulated Capital and Other Losses | | | Unrealized Appreciated/ (Depreciated) | |
| | | | |
FlexShares US Quality Low Volatility Index Fund | | $ | 357,431 | | | $ | — | | | $ | (10,885,039 | ) | | $ | 11,291,636 | |
| | | | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 418,446 | | | | — | | | | (5,150,172 | ) | | | (1,303,271 | ) |
| | | | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 9,422 | | | | — | | | | (1,374,462 | ) | | | (1,068,277 | ) |
| | | | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 3,214,721 | | | | — | | | | (47,769,070 | ) | | | 469,965,558 | |
| | | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 5,241,853 | | | | — | | | | (127,394,105 | ) | | | 17,955,993 | |
| | | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 4,850,122 | | | | — | | | | (78,207,093 | ) | | | 159,826 | |
| | | | |
FlexShares US Quality Large Cap Index Fund | | | 215,453 | | | | — | | | | (7,567,330 | ) | | | 6,797,985 | |
| | | | |
FlexShares STOXX® US ESG Select Index Fund | | | 284,490 | | | | — | | | | (7,436,552 | ) | | | 11,460,002 | |
| | | | |
FlexShares STOXX® Global ESG Select Index Fund | | | 526,426 | | | | — | | | | (7,924,425 | ) | | | 24,173,819 | |
| | | | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 81,560 | | | | — | | | | (605,306 | ) | | | 79,951 | |
| | | | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 144,944 | | | | — | | | | (2,189,649 | ) | | | (1,866,028 | ) |
| | | | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 30,311 | | | | — | | | | (230,162 | ) | | | (609,488 | ) |
| | | | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 43,217,751 | | | | — | | | | (1,098,185,272 | ) | | | 216,460,320 | |
| | | | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 6,643,785 | | | | — | | | | (230,956,317 | ) | | | (137,443,474 | ) |
| | | | |
FlexShares Global Quality Real Estate Index Fund | | | 298,636 | | | | — | | | | (65,254,222 | ) | | | (43,295,006 | ) |
| | | | |
FlexShares Real Assets Allocation Index Fund | | | — | | | | — | | | | (740,661 | ) | | | (3,832,291 | ) |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 509 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | | | | | |
Fund | | Undistributed Ordinary Income | | | Undistributed Long-Term Capital Gains | | | Accumulated Capital and Other Losses | | | Unrealized Appreciated/ (Depreciated) | |
| | | | |
FlexShares Quality Dividend Index Fund | | $ | 5,614,878 | | | $ | — | | | $ | (150,004,663 | ) | | $ | 145,641,451 | |
| | | | |
FlexShares Quality Dividend Defensive Index Fund | | | 1,117,618 | | | | — | | | | (38,688,284 | ) | | | 24,024,113 | |
| | | | |
FlexShares International Quality Dividend Index Fund | | | 10,585,320 | | | | — | | | | (196,891,117 | ) | | | (27,842,498 | ) |
| | | | |
FlexShares International Quality Dividend Defensive Index Fund | | | 343,843 | | | | — | | | | (29,186,806 | ) | | | (1,658,215 | ) |
| | | | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 1,826,556 | | | | — | | | | (24,086,274 | ) | | | (6,712,222 | ) |
| | | | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 10,423,162 | | | | — | | | | (146,788,111 | ) | | | (108,003,462 | ) |
| | | | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 4,587,365 | | | | — | | | | (38,205,305 | ) | | | (76,349,655 | ) |
| | | | |
FlexShares Disciplined Duration MBS Index Fund | | | 321,558 | | | | — | | | | (14,378,429 | ) | | | (7,851,426 | ) |
| | | | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 1,111,790 | | | | — | | | | (26,605,903 | ) | | | (15,584,572 | ) |
| | | | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 143,487 | | | | — | | | | (12,124,960 | ) | | | (6,496,878 | ) |
| | | | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 9,849,899 | | | | — | | | | (131,676,831 | ) | | | (90,701,539 | ) |
| | | | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | 94,595 | | | | — | | | | (8,049,336 | ) | | | (3,497,949 | ) |
| | | | |
FlexShares Ultra-Short Income Fund | | | 4,867,065 | | | | — | | | | (1,043,098 | ) | | | (3,429,075 | ) |
| | | | |
FlexShares Core Select Bond Fund | | | — | | | | — | | | | (13,822,949 | ) | | | (21,869,180 | ) |
Capital loss carry forwards will retain their character as either short-term or long-term capital losses rather than being considered all short-term as permitted under previous law and may be carried forward indefinitely to offset future gains.
For the tax year ended October 31, 2023, the following Funds had available post-enactment capital loss carryforwards to offset future net capital gains to the extent provided by regulations:
| | | | | | | | | | | | |
Fund | | Short-Term | | | Long-Term | | | Total | |
| | | |
FlexShares US Quality Low Volatility Index Fund | | $ | 7,362,077 | | | $ | 3,522,962 | | | $ | 10,885,039 | |
| | | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 3,241,058 | | | | 1,909,114 | | | | 5,150,172 | |
| | | | | | | | | | | | |
Fund | | Short-Term | | | Long-Term | | | Total | |
| | | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | $ | 785,129 | | | $ | 589,333 | | | $ | 1,374,462 | |
| | | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 32,585,524 | | | | 15,183,546 | | | | 47,769,070 | |
| | | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 28,949,295 | | | | 98,444,810 | | | | 127,394,105 | |
| | | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 26,007,227 | | | | 52,199,866 | | | | 78,207,093 | |
| | | | |
510 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | |
Fund | | Short-Term | | | Long-Term | | | Total | |
| | | |
FlexShares US Quality Large Cap Index Fund | | $ | 3,666,731 | | | $ | 3,900,599 | | | $ | 7,567,330 | |
| | | |
FlexShares STOXX® US ESG Select Index Fund | | | 7,156,636 | | | | 279,916 | | | | 7,436,552 | |
| | | |
FlexShares STOXX® Global ESG Select Index Fund | | | 7,080,589 | | | | 843,836 | | | | 7,924,425 | |
| | | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 290,150 | | | | 315,156 | | | | 605,306 | |
| | | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 1,620,184 | | | | 569,465 | | | | 2,189,649 | |
| | | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 171,773 | | | | 58,389 | | | | 230,162 | |
| | | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 385,239,809 | | | | 712,945,463 | | | | 1,098,185,272 | |
| | | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 63,184,453 | | | | 167,771,864 | | | | 230,956,317 | |
| | | | | | | | | | | | |
Fund | | Short-Term | | | Long-Term | | | Total | |
| | | |
FlexShares Global Quality Real Estate Index Fund | | $ | 44,579,447 | | | $ | 20,674,775 | | | $ | 65,254,222 | |
| | | |
FlexShares Real Assets Allocation Index Fund | | | 108,379 | | | | 632,282 | | | | 740,661 | |
| | | |
FlexShares Quality Dividend Index Fund | | | 99,572,290 | | | | 50,432,373 | | | | 150,004,663 | |
| | | |
FlexShares Quality Dividend Defensive Index Fund | | | 30,400,105 | | | | 8,288,179 | | | | 38,688,284 | |
| | | |
FlexShares International Quality Dividend Index Fund | | | 123,079,184 | | | | 73,811,933 | | | | 196,891,117 | |
| | | |
FlexShares International Quality Dividend Defensive Index Fund | | | 18,194,421 | | | | 10,992,385 | | | | 29,186,806 | |
| | | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 14,626,606 | | | | 9,459,668 | | | | 24,086,274 | |
| | | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 117,222,701 | | | | 29,565,410 | | | | 146,788,111 | |
| | | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 19,478,364 | | | | 18,726,941 | | | | 38,205,305 | |
| | | |
FlexShares Disciplined Duration MBS Index Fund | | | 7,966,616 | | | | 6,411,813 | | | | 14,378,429 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 511 | |
Notes to the Financial Statements (cont.)
| | | | | | | | | | | | |
Fund | | Short-Term | | | Long-Term | | | Total | |
| | | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | $ | 8,223,295 | | | $ | 18,382,608 | | | $ | 26,605,903 | |
| | | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 3,219,212 | | | | 8,905,748 | | | | 12,124,960 | |
| | | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 78,144,414 | | | | 53,532,417 | | | | 131,676,831 | |
| | | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | 5,644,513 | | | | 2,404,823 | | | | 8,049,336 | |
| | | |
FlexShares Ultra-Short Income Fund | | | 728,302 | | | | 314,796 | | | | 1,043,098 | |
| | | |
FlexShares Core Select Bond Fund | | | 4,820,403 | | | | 9,002,546 | | | | 13,822,949 | |
During the year ended October 31, 2023, the following Funds utilized capital loss carryforwards to offset net capital gains:
| | | | |
Fund | | Capital Loss Utilized | |
| |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | $ 701,203 | |
| |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 165,510,282 | |
| |
FlexShares Real Assets Allocation Index Fund | | | 78 | |
| |
FlexShares Ultra-Short Income Fund | | | 40,482 | |
The FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX® Global ESG Select Index Fund, FlexShares ESG &
Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX® Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund , FlexShares Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares High Yield Value-Scored Bond Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund may be subject to foreign withholding taxes with respect to dividends or interest received from sources in foreign countries. If, at the close of the taxable year, more than 50% in value of a Fund’s assets consists of stock or securities in foreign corporations the Fund will be eligible to make an election to treat a proportionate amount of those taxes as constituting a distribution to each shareholder, which would allow all shareholders to either (1) credit that proportionate amount of taxes against U.S. Federal income tax liability as a foreign tax credit or (2) take that amount as an itemized deduction. If a Fund is not eligible to make this election or is eligible but does not make the election, it will be entitled to deduct such taxes in computing the amounts it is required to distribute.
3. Investment Transactions and Related Income and Expense
Throughout the reporting period, investment transactions are accounted for no later than one business day following the trade date. For financial reporting purposes, investment transactions are accounted for on the trade date on the last business day of the reporting period.
Interest income is recognized on an accrual basis. Bond discount is accreted and premium is amortized using the effective yield method. Dividend income is recorded on the ex-dividend date, or as soon as information is available. Gains or losses realized on sales of securities are determined using the specific identification method by comparing the identified cost of the security lot sold with the net sales proceeds.
| | | | |
512 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
Each Fund except the FlexShares iBoxx 3-Year Target Duration TIPs Index Fund, and the FlexShares iBoxx 5-Year Target Duration TIPs Index Fund may hold the securities of real estate investment trusts (“REITs”). Distributions from such investments may be comprised of return of capital, capital gains and income. The actual character of amounts received during the year is not known until after the REIT’s fiscal year end. The Fund records the character of distributions received from REITs during the year based on estimates available. The characterization of distributions received by the Fund may be subsequently revised based on information received from the REITs after their tax reporting periods concluded.
All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign markets in which a Fund invests. These foreign taxes, if any, are paid by the Funds and disclosed in the Statements of Operations. Foreign taxes payable, if any, are reflected in the Funds’ Statements of Assets and Liabilities.
Expenses directly attributable to a Fund are charged to that Fund, while expenses which are attributable to more than one Fund are allocated among the respective Funds based upon relative net assets or another reasonable basis.
4. Investment Advisory Fees
NTI serves as the Investment Adviser of the Funds pursuant to the Investment Advisory Agreement. The Investment Adviser is responsible for making investment decisions for the Funds and for placing purchase and sale orders for portfolio securities, subject to the general supervision of the Board.
As compensation for its advisory services and assumption of certain Fund expenses, NTI is entitled to a unitary management fee (“Management Fee”), computed daily and payable monthly, at the annual rates set forth in the table below (expressed as a percentage of each Fund’s respective average daily net assets).
From the Management Fee, NTI pays most of the expenses of the Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services (“Covered Expenses”). Covered Expenses do not include the following fees under the Investment Advisory Agreement: its
advisory fees payable under the Advisory Agreement, distribution fees and expenses paid by the Trust under any distribution plan adopted pursuant to Rule 12b-1, interest expenses, brokerage commissions and other trading expenses, fees and expenses of the independent trustees and their independent legal counsel, taxes and other extraordinary costs such as (i) dividend expenses on short sales; (ii) non-routine items, including litigation expenses and proxy expenses; and (iii) expenses that the Fund has incurred but did not actually pay due to an expense offset agreement, if applicable.
The Management Fee rate payable by each Fund is set forth in the following table:
| | | | |
Fund | | Unitary Management Fee | |
| |
FlexShares US Quality Low Volatility Index Fund | | | 0.22 | % |
| |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 0.32 | % |
| |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 0.40 | % |
| |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 0.25 | % |
| |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 0.39 | % |
| |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 0.59 | % |
| |
FlexShares US Quality Large Cap Index Fund | | | 0.25 | % |
| |
FlexShares STOXX® US ESG Select Index Fund | | | 0.32 | % |
| |
FlexShares STOXX® Global ESG Select Index Fund | | | 0.42 | % |
| |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 0.09 | % |
| |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 0.12 | % |
| |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 0.18 | % |
| |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 0.46 | % |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 513 | |
Notes to the Financial Statements (cont.)
| | | | |
Fund | | Unitary Management Fee | |
| |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 0.47 | % |
| |
FlexShares Global Quality Real Estate Index Fund | | | 0.45 | % |
| |
FlexShares Real Assets Allocation Index Fund | | | 0.49 | %* |
| |
FlexShares Quality Dividend Index Fund | | | 0.37 | % |
| |
FlexShares Quality Dividend Defensive Index Fund | | | 0.37 | % |
| |
FlexShares International Quality Dividend Index Fund | | | 0.47 | % |
| |
FlexShares International Quality Dividend Defensive Index Fund | | | 0.47 | % |
| |
FlexShares® International Quality Dividend Dynamic Index Fund | | | 0.47 | % |
| |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 0.18 | % |
| |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 0.18 | % |
| |
FlexShares Disciplined Duration MBS Index Fund | | | 0.20 | % |
| |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 0.22 | % |
| |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 0.22 | % |
| |
FlexShares High Yield Value-Scored Bond Index Fund | | | 0.37 | % |
| |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | 0.12 | % |
| |
FlexShares Ultra-Short Income Fund | | | 0.25 | % |
| |
FlexShares Core Select Bond Fund | | | 0.35 | % |
* | Prior to September 1, 2023, the investment advisory fee for the FlexShares Real Assets Allocation Index Fund was 0.57%. |
The Investment Adviser has contractually agreed until March 1, 2024 to reimburse a portion of the operating expenses of each Fund (other than Rule 12b-1 fees, tax expenses, extraordinary expenses, and acquired fund fees and expenses (“AFFE”)) so the “Total Annual Fund Operating Expenses After Expense Reimbursement” do not exceed
the Fund’s Management Fee plus (+) 0.0049%. In the case of the FlexShares Real Assets Allocation Index Fund, the Investment Adviser has contractually agreed until March 1, 2024 to waive Management Fees or reimburse certain expenses in an amount equal to the AFFE attributable to the Fund’s investments in its Underlying Funds. After these dates, the contractual arrangements will continue automatically thereafter for periods of one year (each such one-year period, a “Renewal Year”). The contractual arrangements may be terminated, with respect to a Fund, as to any succeeding Renewal Year, by NTI or the Fund upon 60 days’ written notice prior to the end of the current Renewal Year. The Board may terminate the arrangements at any time with respect to a Fund if it determines that it is in the best interest of the Fund and its shareholders. In the case of the FlexShares Core Select Bond Fund, the Investment Adviser has contractually agreed until March 1, 2024 to waive Management Fees or reimburse certain expenses in an amount equal to the sum of (a) any AFFE incurred by the Fund that are attributable to the Fund’s investment in Underlying Funds managed by NTI or an investment adviser controlling, controlled by, or under common control with NTI (“Affiliated Funds”); and (b) 0.05% or such lesser amount in AFFE incurred by the Fund that are attributable to the Fund’s investment in Underlying Funds that are not Affiliated Funds. AFFE are expenses incurred indirectly by the Fund through its ownership of shares in other investment companies. Because AFFE are not direct expenses of a Fund, they are not reflected on a Fund’s financial statements. After these dates, the contractual expense reimbursement agreements continue automatically for periods of one year unless terminated, as to any succeeding renewal year, by either party upon 60 days’ written notice prior to the end of the current term. The Board may terminate the contractual expense reimbursement agreements discussed above with respect to any Fund at any time if it determines that it is in the best interest of a Fund and its shareholders. These expenses and the reimbursements are shown as “Investment advisory fees reimbursed” on the Statements of Operations.
The Investment Adviser may voluntarily waive or reimburse additional management fees or expenses. Any such additional voluntary expense reimbursement or fee waiver could be implemented, increased or decreased, or discontinued at
| | | | |
514 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
any time. Amounts waived or reimbursed by the Investment Adviser pursuant to voluntary or contractual agreements discussed above may not be recouped by the Investment Adviser. These waivers and/or reimbursements are shown as “Investment advisory fees reimbursed” on the Statements of Operations. For the year ended October 31, 2023, the Investment Adviser voluntarily reimbursed additional management fees for FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, and FlexShares High Yield Value-Scored Bond Index Fund. The amounts of the voluntary reimbursements are $16,693, $2,167, and $84,821, respectively.
5. Administration Fees
Per terms of agreements JPMorgan Chase Bank, N.A. (the “Administrator”) serves as administrator of the Funds. The Administrator provides certain administrative services to the Funds. For these services, the Administrator is entitled to certain fees and reasonable out-of-pocket expenses. These fees and expenses are Covered Expenses as defined above.
6. Custodian Fees
JPMorgan Chase Bank, N.A. (the “Custodian”) acts as custodian for the Funds in accordance with a Global Custody Agreement. The Custodian holds cash, securities and other assets of the Funds as required by the 1940 Act. As compensation for the services rendered under the agreement, the Custodian is entitled to fees and reasonable out-of-pocket expenses. These fees and expenses are Covered Expenses as defined above.
7. Trustees Fees
The Trust compensates each Trustee who is not an officer, director or employee of Northern Trust Corporation, or its subsidiaries, for his or her services as a Trustee of the Trust and as a member of Board committees.
The Trust has adopted a deferred compensation plan (the “DC Plan”) for its Trustees who are not officers of Northern Trust or NTI. Under the DC Plan, Independent Trustees may elect to defer all or a portion of their compensation. The amount deferred is adjusted periodically based upon the performance of the investment options selected by the
Trustees. The investment options currently available under the DC Plan are the FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX® US ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, and the FlexShares Ultra-Short Income Fund. Expenses related to the DC Plan are stated on the Statements of Operations.
8. Distribution and Service Plan
ACA Foreside, formerly known as Foreside Fund Services, LLC (the “Distributor”) serves as the Funds’ distributor and distributes Creation Units (as described in Note 9) for each Fund on an agency basis. The Distributor does not receive a fee from the Funds for its distribution services. However, it receives compensation from NTI for its services as distributor pursuant to a separate letter agreement between it and NTI.
The Trust has adopted a Distribution and Service Plan (“the Plan”) pursuant to Rule 12b-1 under the 1940 Act. Payments to financial intermediaries under the Plan are tied directly to their own out-of-pocket expenses. The Plan has not been implemented with respect to the Funds. The Plan may not be implemented without further Board approval. The maximum distribution fee is 0.25% of each Fund’s respective average daily net assets under the Plan. The Funds did not pay any 12b-1 fees during the fiscal year.
9. Issuance and Redemption of Fund Shares
Each Fund only issues and redeems shares to Authorized Participants in exchange for the deposit or delivery of a basket of assets (securities and/or cash), in large blocks known as Creation Units, each of which is comprised of a specified number of shares.
Retail investors may only purchase and sell fund shares in the secondary market through a broker-dealer and such transactions may be subject to customary commission and fee rates imposed by the broker-dealer.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 515 | |
Notes to the Financial Statements (cont.)
Authorized Participants may pay transaction fees to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units. The transaction fees are paid directly to the Fund and used to offset Fund custody fees. Certain fees or costs associated with Creation Unit purchases may be paid by NTI in certain circumstances. In addition, the Trust may from time to time waive the standard transaction fee. The net custody fees charged to the Fund are paid for by the Investment Adviser through the Fund’s Unitary Fee. Transaction fees remaining in the Funds were as follows:
| | | | | | | | |
Fund | | As of October 31, 2023 | | | As of October 31, 2022 | |
| | |
FlexShares US Quality Low Volatility Index Fund | | $ | 2,100 | | | $ | — | |
| | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 4,000 | | | | 4,000 | |
| | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 6,000 | | | | 6,000 | |
| | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 27,000 | | | | 13,500 | |
| | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 50,000 | | | | 50,000 | |
| | |
FlexShares US Quality Large Cap Index Fund | | | 3,000 | | | | 3,000 | |
| | |
FlexShares STOXX® US ESG Select Index Fund | | | 700 | | | | 1,050 | |
| | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | — | | | | 500 | |
| | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 4,500 | | | | — | |
| | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 1,500 | | | | 28,500 | |
| | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 12,000 | | | | 26,000 | |
| | |
FlexShares Global Quality Real Estate Index Fund | | | 4,000 | | | | 2,000 | |
| | |
FlexShares Quality Dividend Index Fund | | | 4,950 | | | | 5,650 | |
| | | | | | | | |
Fund | | As of October 31, 2023 | | | As of October 31, 2022 | |
| | |
FlexShares Quality Dividend Defensive Index Fund | | $ | 2,500 | | | $ | 2,150 | |
| | |
FlexShares International Quality Dividend Index Fund | | | 12,000 | | | | 12,000 | |
| | |
FlexShares International Quality Dividend Defensive Index Fund | | | — | | | | 7,000 | |
| | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 3,500 | | | | 3,500 | |
| | |
FlexShares Disciplined Duration MBS Index Fund | | | 2,000 | | | | 1,600 | |
| | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 3,000 | | | | 2,500 | |
| | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | — | | | | 1,000 | |
| | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 24,500 | | | | 4,000 | |
| | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | 2,000 | | | | 1,500 | |
| | |
FlexShares Ultra-Short Income Fund | | | 1,925 | | | | 4,025 | |
The FlexShares Real Assets Allocation Index Fund, FlexShares iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund and the FlexShares Core Select Bond Fund do not charge standard creation unit transaction fees.
10. Investment Transactions
For the year ended October 31, 2023, the FlexShares iBoxx 3-Year Target Duration TIPS Index, FlexShares iBoxx 5-Year Target Duration TIPS Index and FlexShares Disciplined Duration MBS Index Funds invested solely in U.S. Government, including U.S. government agency, securities. The cost of securities purchased by each Fund and proceeds from sales of securities, excluding short-term securities,
| | | | |
516 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
derivatives and in-kind transactions for the period ended October 31, 2023, were as follows:
| | | | | | | | |
Fund | | Purchases | | | Sales | |
| | |
FlexShares US Quality Low Volatility Index Fund | | $ | 93,131,164 | | | $ | 92,740,924 | |
| | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 36,678,289 | | | | 36,941,832 | |
| | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 14,877,163 | | | | 10,899,781 | |
| | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 212,200,681 | | | | 213,141,623 | |
| | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 111,953,720 | | | | 110,229,159 | |
| | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 91,065,592 | | | | 97,949,117 | |
| | |
FlexShares US Quality Large Cap Index Fund | | | 28,132,126 | | | | 27,096,190 | |
| | |
FlexShares STOXX® US ESG Select Index Fund | | | 48,625,803 | | | | 49,629,639 | |
| | |
FlexShares STOXX® Global ESG Select Index Fund | | | 54,301,660 | | | | 55,327,700 | |
| | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 5,015,258 | | | | 4,979,754 | |
| | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 11,286,030 | | | | 10,505,558 | |
| | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 1,580,974 | | | | 1,591,165 | |
| | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 2,033,684,300 | | | | 1,933,733,245 | |
| | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 286,610,013 | | | | 303,547,565 | |
| | | | | | | | |
Fund | | Purchases | | | Sales | |
| | |
FlexShares Global Quality Real Estate Index Fund | | $ | 159,166,407 | | | $ | 153,176,208 | |
| | |
FlexShares Real Assets Allocation Index Fund | | | 2,374,109 | | | | 2,370,687 | |
| | |
FlexShares Quality Dividend Index Fund | | | 813,036,880 | | | | 801,754,933 | |
| | |
FlexShares Quality Dividend Defensive Index Fund | | | 176,766,250 | | | | 173,101,476 | |
| | |
FlexShares International Quality Dividend Index Fund | | | 254,841,680 | | | | 247,331,548 | |
| | |
FlexShares International Quality Dividend Defensive Index Fund | | | 21,017,150 | | | | 27,413,078 | |
| | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 65,289,740 | | | | 66,281,057 | |
| | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 1,247,512,487 | | | | 1,308,171,064 | |
| | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 375,228,916 | | | | 396,897,290 | |
| | |
FlexShares Disciplined Duration MBS Index Fund | | | 37,279,002 | | | | 58,756,851 | |
| | |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 323,111,307 | | | | 294,164,214 | |
| | |
FlexShares Credit-Scored US Long Corporate Bond Index Fund | | | 33,822,585 | | | | 40,268,237 | |
| | |
FlexShares High Yield Value-Scored Bond Index Fund | | | 2,117,583,248 | | | | 1,762,999,413 | |
| | |
FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | | | 29,904,605 | | | | 26,968,684 | |
| | |
FlexShares Ultra-Short Income Fund | | | 382,547,774 | | | | 183,994,615 | |
| | |
FlexShares Core Select Bond Fund | | | 49,769,155 | | | | 47,019,068 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 517 | |
Notes to the Financial Statements (cont.)
11. In-Kind Transactions
During the period ended October 31, 2023, certain Funds received securities in exchange for subscriptions of shares (subscriptions-in-kind). For the period ended October 31, 2023, the fair value of the securities received for subscriptions for these Funds were as follows:
| | | | |
Fund | | Fair Value | |
| |
FlexShares US Quality Low Volatility Index Fund | | $ | 68,470,456 | |
| |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 6,600,137 | |
| |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 1,371,110 | |
| |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 1,383,093 | |
| |
FlexShares US Quality Large Cap Index Fund | | | 25,938,638 | |
| |
FlexShares STOXX® US ESG Select Index Fund | | | 7,125,056 | |
| |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 13,832,105 | |
| |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 18,595,357 | |
| |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 580,545,586 | |
| |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 11,411,409 | |
| |
FlexShares Global Quality Real Estate Index Fund | | | 12,194,596 | |
| |
FlexShares Real Assets Allocation Index Fund | | | 744,272 | |
| |
FlexShares Quality Dividend Index Fund | | | 474,812,809 | |
| |
FlexShares Quality Dividend Defensive Index Fund | | | 56,033,401 | |
| |
FlexShares International Quality Dividend Index Fund | | | 30,324,990 | |
| |
FlexShares International Quality Dividend Dynamic Index Fund | | | 29,863,178 | |
| |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 357,220,503 | |
| |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 377,738,669 | |
| |
FlexShares Credit-Scored US Corporate Bond Index Fund | | | 1,999,330 | |
| |
FlexShares High Yield Value-Scored Bond Index Fund | | | 7,720,827 | |
| |
FlexShares Core Select Bond Fund | | | 50,271,695 | |
During the period ended October 31, 2023, certain Funds delivered securities in exchange for redemption of shares (redemptions-in-kind). For financial reporting purposes, these Funds recorded net realized gains and losses in connection with each transaction. For the period ended October 31, 2023, the fair value and realized gain (losses) of the securities transferred for redemptions for these Funds were as follows:
| | | | | | | | |
Fund | | Fair Value | | | Net Realized Gains(Losses) | |
| | |
FlexShares US Quality Low Volatility Index Fund | | $ | 50,231,636 | | | $ | 11,134,030 | |
| | |
FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | 6,860,770 | | | | 950,797 | |
| | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 625,183 | | | | (2,860 | ) |
| | |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 120,575,308 | | | | 68,210,356 | |
| | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 19,338,229 | | | | 4,871,522 | |
| | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 2,567,162 | | | | 384,978 | |
| | |
FlexShares US Quality Large Cap Index Fund | | | 15,348,805 | | | | 3,349,919 | |
| | |
FlexShares STOXX® US ESG Select Index Fund | | | 29,011,942 | | | | 7,404,165 | |
| | |
FlexShares STOXX® Global ESG Select Index Fund | | | 12,040,546 | | | | 3,774,231 | |
| | |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 1,242,968 | | | | 358,040 | |
| | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 35,366,352 | | | | 13,171,091 | |
| | |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 469,431,358 | | | | 118,182,191 | |
| | | | |
518 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
| | | | | | | | |
Fund | | Fair Value | | | Net Realized Gains(Losses) | |
| | |
FlexShares Global Quality Real Estate Index Fund | | $ | 63,997,131 | | | $ | 3,452,008 | |
| | |
FlexShares Real Assets Allocation Index Fund | | | 12,803,516 | | | | (1,193,639 | ) |
| | |
FlexShares Quality Dividend Index Fund | | | 602,931,860 | | | | 152,543,538 | |
| | |
FlexShares Quality Dividend Defensive Index Fund | | | 105,180,993 | | | | 26,282,096 | |
| | |
FlexShares International Quality Dividend Index Fund | | | 18,767,105 | | | | 3,130,154 | |
| | |
FlexShares International Quality Dividend Defensive Index Fund | | | 11,898,366 | | | | 1,103,875 | |
| | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 34,561,443 | | | | 4,726,915 | |
| | |
FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | | | 553,092,089 | | | | (4,342,963 | ) |
| | |
FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | | | 182,025,725 | | | | 394,493 | |
| | |
FlexShares Core Select Bond Fund | | | 20,677,491 | | | | 128,567 | |
12. Reorganization Transaction
After the close of business on June 30, 2023, FlexShares® Quality Dividend Index Fund, acquired the net assets of the FlexShares® Quality Dividend Dynamic Index Fund, a series of the Trust, pursuant to an Agreement and Plan of Reorganization. For U.S. GAAP purposes, this transaction was treated as a merger. The reorganization was accomplished by a tax-free exchange resulting in the FlexShares® Quality Dividend Index Fund issuing 292,980 (valued at $16,941,795) in exchange for 275,001 FlexShares® Quality Dividend Dynamic Index Fund at a conversion ratio of 1.065. The securities held by FlexShares® Quality Dividend Dynamic Index Fund, with a fair value of $14,967,409 and identified cost of $12,597,211, and cash in the amount of $1,972,151 at June 30, 2023, were the principal assets
acquired by FlexShares® Quality Dividend Index Fund. For U.S. GAAP purposes, assets received and shares issued by FlexShares® Quality Dividend Index Fund were recorded at fair value; however, the cost basis of the investments from FlexShares® Quality Dividend Dynamic Index Fund was carried forward to align ongoing reporting of FlexShares® Quality Dividend Index Fund realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes. FlexShares® Quality Dividend Dynamic Index Fund’s net assets at the merger date of $16,941,795, including $2,370,198 of unrealized appreciation, $6,304 of undistributed net investment gain and $638,516 of undistributed net realized gain on investments were combined with those of FlexShares® Quality Dividend Index Fund. Regarding the acquisition completed June 30, 2023, the beginning of the annual reporting period of FlexShares® Quality Dividend Dynamic Index Fund, pro forma results of operations for the year ended October 31, 2023 would have resulted in a net investment income of $38,495,653 and net realized and unrealized gain of $65,719,138 resulting in a increase in net assets from operations of $104,214,791. Because the combined Funds have been managed as a single integrated Fund since the acquisition date, it is not practicable to separate the amounts of revenue and earnings of the FlexShares® Quality Dividend Dynamic Index Fund that have been included in FlexShares® Quality Dividend Index Fund’s Statement of Operations since the merger date. Prior to the combination, the net assets of the FlexShares® Quality Dividend Index Fund totaled $1,590,209,763. Immediately after the combination, the net assets of the FlexShares® Quality Dividend Index Fund totaled $1,607,151,558.
13. Guarantees and Indemnifications
In the normal course of business each Fund enters into contracts with third-party service providers that contain a variety of representations and warranties and that provide general indemnifications. Additionally, under the Funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. The Funds’ maximum exposure under these arrangements is unknown, as it involves possible future claims that may or may not be made against the Funds.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 519 | |
Notes to the Financial Statements (cont.)
14. New Accounting Pronouncements
In March 2020, the FASB issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848) “Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (“ASU 2020-04”), which provides optional temporary financial reporting relief from the effect of certain types of contract modifications and hedging transactions as a result of the global markets anticipated transition away the London Interbank Offered Rate (“LIBOR”) and other interbank-offered based reference rates as of the end of 2021.
Preceding the issuance of ASU 2020-04, which established ASC 848, the United Kingdom’s Financial Conduct Authority (FCA) announced that it would no longer need to persuade or compel banks to submit to LIBOR after December 31, 2021. In response, the FASB established a December 31, 2022, expiration date for ASC 848.
In March 2021, the FCA announced that the intended cessation date of LIBOR in the United States would be June 30, 2023. Accordingly, ASU 2022-06 defers the expiration date of ASC 848 to December 31, 2024. Management does not believe this update has a material impact on the Funds’ financial statements.
15. Legal Proceedings
On or about February 14, 2020, Marc S. Kirschner, as Trustee for NWHI Litigation Trust (“Litigation Trustee”) and Wilmington Savings Fund Society, FSB, as indenture Trustee (“Indenture Trustee”) for several series of notes issued by Nine West Holdings, Inc. (“Nine West”), filed separate complaints (docket nos. 20-cv-01129 and 20-cv-01136, respectively ) in the United States District Court for the Northern District of Illinois against a group of defendants including the FlexShares Morningstar US Market Factor Tilt Index Fund that had invested in The Jones Group Inc. (“Jones Group”). The claims in these actions stem from a series of merger transactions (“Transactions”) entered into by Jones Group, Nine West and others in 2014 that allegedly rendered Jones Group insolvent. The matters in these proceedings were transferred from the United States District Court for the Northern District of Illinois to the United States District Court for the Southern District of New York
to centralize the litigation, and were assigned to the Honorable Jed S. Rakoff for coordinated or consolidated pretrial proceedings. The FlexShares Morningstar US Market Factor Tilt Index Fund allegedly received $224,910 as a result of the Transactions. The Litigation Trustee and Indenture Trustee seek to clawback these proceeds for the benefit of the Trust and the noteholders, respectively, on the basis that they were alleged fraudulent conveyances. On June 29, 2020, the former public shareholder defendants, including FlexShares Morningstar US Market Factor Tilt Index Fund, filed a motion to dismiss on the basis that the payments allegedly made to them in connection with the Transactions were shielded from the fraudulent conveyance claims under Section 546(e) of the Bankruptcy Code. On August 27, 2020, all fraudulent conveyance claims against the former public shareholder defendants were dismissed. Plaintiffs appealed from that decision before the U.S. Court of Appeals for the Second Circuit. On November 27, 2023, the Second Circuit affirmed the District Court’s decision insofar as it dismissed all fraudulent conveyance claims against the public shareholder defendants, agreeing with the District Court that the payments made to the public shareholders in connection with the leveraged buyout were safe harbored under Bankruptcy Code Section 546(e). The decision of the Second Circuit remains subject to potential further appeals. The Fund intends to continue to vigorously defend itself against this action.
16. Foreign Instability
Unexpected political, regulatory and diplomatic events and military conflicts around the world may affect investor and consumer confidence and may adversely impact global financial markets and the broader economy. Foreign conflicts have caused, and could continue to cause, significant market disruptions and volatility within specific markets and globally. The hostilities and sanctions resulting from those conflicts have, and could continue to have, a significant impact on certain Fund investments as well as Fund performance and liquidity. The economies of the United States and its trading partners, as well as the financial markets generally, may be adversely impacted by trade disputes and other matters.
| | | | |
520 | | FLEXSHARES ANNUAL REPORT | | |
Notes to the Financial Statements (cont.)
17. Subsequent Events
Management has evaluated subsequent events for the Funds through the date the financial statements were issued, and has concluded that there are no recognized or non-recognized subsequent events relevant for financial statement disclosure.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 521 | |
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees of FlexShares® Trust
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statements of assets and liabilities of FlexShares® Trust, comprising the FlexShares® US Quality Low Volatility Index Fund, FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares® Emerging Markets Quality Low Volatility Index Fund, FlexShares® Morningstar US Market Factor Tilt Index Fund, FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares® US Quality Large Cap Index Fund, FlexShares® STOXX® US ESG Select Index Fund, FlexShares® STOXX® Global ESG Select Index Fund, FlexShares® ESG & Climate US Large Cap Core Index Fund, FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares® ESG & Climate Emerging Markets Core Index Fund, FlexShares® Morningstar Global Upstream Natural Resources Index Fund, FlexShares® STOXX® Global Broad Infrastructure Index Fund, FlexShares® Global Quality Real Estate Index Fund, FlexShares® Real Assets Allocation Index Fund, FlexShares® Quality Dividend Index Fund, FlexShares® Quality Dividend Defensive Index Fund, FlexShares® International Quality Dividend Index Fund, FlexShares® International Quality Dividend Defensive Index Fund, FlexShares® International Quality Dividend Dynamic Index Fund, FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund, FlexShares® Disciplined Duration MBS Index Fund, FlexShares® Credit-Scored US Corporate Bond Index Fund, FlexShares® Credit-Scored US Long Corporate Bond Index Fund, FlexShares® High Yield Value-Scored Bond Index Fund, FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares® Ultra-Short Income Fund (formerly FlexShares® Ready Access Variable Income Fund), and FlexShares® Core Select Bond Fund (collectively, the “Funds”), including the schedules of investments, as of October 31, 2023; the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended for FlexShares® Morningstar US Market Factor Tilt Index Fund, FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares® US Quality Large Cap Index Fund, FlexShares® STOXX® US ESG Select Index Fund, FlexShares® STOXX® Global ESG Select Index Fund, FlexShares® Morningstar Global Upstream Natural Resources Index Fund, FlexShares® STOXX® Global Broad Infrastructure Index Fund, FlexShares® Global Quality Real Estate Index Fund, FlexShares® Real Assets Allocation Index Fund, FlexShares® Quality Dividend Index Fund, FlexShares® Quality Dividend Defensive Index Fund, FlexShares® International Quality Dividend Index Fund, FlexShares® International Quality Dividend Defensive Index Fund, FlexShares® International Quality Dividend Dynamic Index Fund, FlexShares® iBoxx 3-Year Target Duration TIPS Index Funds, FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund, FlexShares® Disciplined Duration MBS Index Fund, FlexShares® Credit-Scored US Corporate Bond Index Fund, FlexShares® Credit-Scored US Long Corporate Bond Index Fund, FlexShares® High Yield Value-Scored Bond Index Fund, FlexShares® Ultra-Short Income Fund (formerly FlexShares® Ready Access Variable Income Fund), and FlexShares® Core Select Bond Fund; the related statements of operations, changes in net assets, and financial highlights for the periods indicated in the table below for FlexShares® US Quality Low Volatility Index Fund, FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares® Emerging Markets Quality Low Volatility Index Fund, FlexShares® ESG & Climate US Large Cap Core Index Fund, FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares® ESG & Climate Emerging Markets Core Index Fund, and FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund; and the related notes.
In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of each of the funds constituting FlexShares® Trust as of October 31, 2023, and the results of their operations for the year then ended (or for the period listed in the table below), the changes in their net assets for each of the two years in the period then ended (or for the period listed in the table below), and the financial highlights for each of the five years in the period then ended (or for the period listed in the table below), in conformity with accounting principles generally accepted in the United States of America.
| | | | |
522 | | FLEXSHARES ANNUAL REPORT | | |
Report of Independent Registered Public Accounting Firm (cont.)
| | | | | | |
Fund Name | | Statement of Operations | | Statements of Changes in Net Assets | | Financial Highlights |
| | | |
FlexShares® US Quality Low Volatility Index Fund FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund FlexShares® Emerging Markets Quality Low Volatility Index Fund | | For the year ended October 31, 2023 | | For the years ended October 31, 2023 and 2022 | | For the years ended October 31, 2023, 2022, 2021, 2020 and for the period from July 15, 2019 (commencement of operations) through October 31, 2019 |
| | | |
FlexShares® ESG & Climate US Large Cap Core Index Fund FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | | For the year ended October 31, 2023 | | For the years ended October 31, 2023 and 2022 | | For the years ended October 31, 2023, 2022, and for the period from September 20, 2021 (commencement of operations) through October 31, 2021 |
| | |
FlexShares® ESG & Climate Emerging Markets Core Index Fund | | For the year ended October 31, 2023 | | For the year ended October 31, 2023 and for the period from April 20, 2022 (commencement of operations) through October 31, 2022 |
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of October 31, 2023, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ DELOITTE & TOUCHE LLP
Chicago, Illinois
December 20, 2023
We have served as the auditor of one or more Northern Trust investment companies since 2002.
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 523 | |
Tax Information October 31, 2023 (Unaudited)
QUALIFIED DIVIDEND INCOME (QDI)
Under the Jobs and Growth Tax Relief Reconciliation Act of 2003 (the “Act”), the following percentages of ordinary dividends paid during the fiscal year ended October 31, 2022 are designated as “qualified dividend income”, as defined in the Act, subject to reduced tax rates in 2022:
| | | | |
Fund | | QDI PERCENTAGE | |
| |
FlexShares US Quality Low Volatility Index Fund | | | 100.00 | % |
| |
FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | | | 90.68 | |
| |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 60.75 | |
| |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 75.27 | |
| |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 86.54 | |
| |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 55.21 | |
| |
FlexShares US Quality Large Cap Index Fund | | | 100.00 | |
| |
FlexShares STOXX® US ESG Select Index Fund | | | 100.00 | |
| |
FlexShares STOXX® Global ESG Select Index Fund | | | 100.00 | |
| |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 100.00 | |
| |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 100.00 | |
| |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 75.31 | |
| |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 92.53 | |
| |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 89.88 | |
| |
FlexShares Global Quality Real Estate Index Fund | | | 15.99 | |
| |
FlexShares Real Assets Allocation Index Fund | | | 75.22 | |
| |
FlexShares Quality Dividend Index Fund | | | 78.11 | |
| |
FlexShares Quality Dividend Defensive Index Fund | | | 86.96 | |
| |
FlexShares International Quality Dividend Index Fund | | | 63.17 | |
| | | | |
Fund | | QDI PERCENTAGE | |
| |
FlexShares International Quality Dividend Defensive Index Fund | | | 69.66 | % |
| |
FlexShares International Quality Dividend Dynamic Index Fund | | | 67.64 | |
CORPORATE DIVIDENDS RECEIVED
DEDUCTION (DRD)
A percentage of the dividends distributed during the fiscal year for the following Funds qualifies for the dividends received deduction for corporate shareholders:
| | | | |
Fund | | CORPORATE DRD PERCENTAGE | |
| |
FlexShares US Quality Low Volatility Index Fund | | | 100.00 | % |
| |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 0.01 | |
| |
FlexShares Morningstar US Market Factor Tilt Index Fund | | | 72.63 | |
| |
FlexShares US Quality Large Cap Index Fund | | | 100.00 | |
| |
FlexShares STOXX® US ESG Select Index Fund | | | 100.00 | |
| |
FlexShares STOXX® Global ESG Select Index Fund | | | 50.55 | |
| |
FlexShares ESG & Climate US Large Cap Core Index Fund | | | 100.00 | |
| |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 0.35 | |
| |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 27.17 | |
| |
FlexShares STOXX® Global Broad Infrastructure Index Fund | | | 43.65 | |
| |
FlexShares Real Assets Allocation Index Fund | | | 29.05 | |
| |
FlexShares Quality Dividend Index Fund | | | 75.44 | |
| |
FlexShares Quality Dividend Defensive Index Fund | | | 85.17 | |
| |
FlexShares International Quality Dividend Dynamic Index Fund | | | 0.02 | |
| | | | |
524 | | FLEXSHARES ANNUAL REPORT | | |
Tax Information (cont.)
FOREIGN TAX CREDIT
Each Fund below intends to make an election that will allow its shareholders to treat their proportionate share of foreign taxes paid by the Fund as having been paid by them. The amounts per share, which represent income from sources within, and taxes paid to foreign countries, are as follows:
| | | | | | | | |
Fund | | TAXES | | | INCOME | |
| | |
FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | | $ | 0.0851 | | | $ | 0.8607 | |
| | |
FlexShares Emerging Markets Quality Low Volatility Index Fund | | | 0.1463 | | | | 0.8785 | |
| | |
FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | | | 0.1708 | | | | 2.2234 | |
| | |
FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | | | 0.2759 | | | | 1.6046 | |
| | |
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | | | 0.1386 | | | | 1.3109 | |
| | |
FlexShares ESG & Climate Emerging Markets Core Index Fund | | | 0.1888 | | | | 1.2186 | |
| | |
FlexShares Morningstar Global Upstream Natural Resources Index Fund | | | 0.0492 | | | | 1.1539 | |
| | |
FlexShares STOXX Global Broad Infrastructure Index Fund | | | 0.0846 | | | | 0.9792 | |
| | |
FlexShares Real Assets Allocation Index Fund | | | 0.0388 | | | | 0.5393 | |
| | |
FlexShares International Quality Dividend Index Fund | | | 0.1431 | | | | 1.2626 | |
| | |
FlexShares International Quality Dividend Defensive Index Fund | | | 0.1105 | | | | 1.2217 | |
| | |
FlexShares International Quality Dividend Dynamic Index Fund | | | 0.2174 | | | | 1.8051 | |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 525 | |
Fund Expenses (Unaudited)
As a shareholder, you incur two types of costs:
(1) Transaction costs for purchasing and selling shares and (2) ongoing costs, including advisory and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses
The actual expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended October 31, 2023.
The first line under each Fund in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The hypothetical expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended October 31, 2023.
The second line under each Fund in the following table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as brokerage commissions on purchases or sales of Fund shares. Therefore, the second line for each Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
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526 | | FLEXSHARES ANNUAL REPORT | | |
Fund Expenses (cont.)
| | | | | | | | | | | | | | | | |
| | Beginning Account Value | | | Ending Account Value 10/31/23 | | | Expenses Paid During the Period* | | | Annualized Expense Ratio During Period | |
|
FlexShares® US Quality Low Volatility Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 986.60 | | | $ | 1.10 | | | | 0.22 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.10 | | | $ | 1.12 | | | | 0.22 | % |
|
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 920.20 | | | $ | 1.55 | | | | 0.32 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.59 | | | $ | 1.63 | | | | 0.32 | % |
|
FlexShares® Emerging Markets Quality Low Volatility Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 968.40 | | | $ | 1.98 | | | | 0.40 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.19 | | | $ | 2.04 | | | | 0.40 | % |
|
FlexShares® Morningstar US Market Factor Tilt Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,003.20 | | | $ | 1.26 | | | | 0.25 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.95 | | | $ | 1.28 | | | | 0.25 | % |
|
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 931.70 | | | $ | 1.90 | | | | 0.39 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.24 | | | $ | 1.99 | | | | 0.39 | % |
|
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 979.50 | | | $ | 2.89 | | | | 0.58 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.28 | | | $ | 2.96 | | | | 0.58 | % |
|
FlexShares® US Quality Large Cap Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,024.20 | | | $ | 1.28 | | | | 0.25 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.95 | | | $ | 1.28 | | | | 0.25 | % |
|
FlexShares® STOXX® US ESG Select Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,018.60 | | | $ | 1.63 | | | | 0.32 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.59 | | | $ | 1.63 | | | | 0.32 | % |
|
FlexShares® STOXX® Global ESG Select Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 981.10 | | | $ | 2.10 | | | | 0.42 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.09 | | | $ | 2.14 | | | | 0.42 | % |
|
FlexShares® ESG & Climate US Large Cap Core Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,010.10 | | | $ | 0.46 | | | | 0.09 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.75 | | | $ | 0.46 | | | | 0.09 | % |
|
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 909.20 | | | $ | 0.58 | | | | 0.12 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.60 | | | $ | 0.61 | | | | 0.12 | % |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 527 | |
Fund Expenses (cont.)
| | | | | | | | | | | | | | | | |
| | Beginning Account Value | | | Ending Account Value 10/31/23 | | | Expenses Paid During the Period* | | | Annualized Expense Ratio During Period | |
|
FlexShares® ESG & Climate Emerging Markets Core Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 961.40 | | | $ | 0.89 | | | | 0.18 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.30 | | | $ | 0.92 | | | | 0.18 | % |
|
FlexShares® Morningstar Global Upstream Natural Resources Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 924.30 | | | $ | 2.23 | | | | 0.46 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.89 | | | $ | 2.35 | | | | 0.46 | % |
|
FlexShares® STOXX® Global Broad Infrastructure Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 910.60 | | | $ | 2.26 | | | | 0.47 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.84 | | | $ | 2.40 | | | | 0.47 | % |
|
FlexShares® Global Quality Real Estate Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 891.70 | | | $ | 2.15 | | | | 0.45 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.94 | | | $ | 2.29 | | | | 0.45 | % |
|
FlexShares® Real Assets Allocation Index Fund(a) | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 911.80 | | | $ | 0.39 | | | | 0.08 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.80 | | | $ | 0.41 | | | | 0.08 | % |
|
FlexShares® Quality Dividend Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,000.20 | | | $ | 1.87 | | | | 0.37 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.34 | | | $ | 1.89 | | | | 0.37 | % |
|
FlexShares® Quality Dividend Defensive Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 997.50 | | | $ | 1.86 | | | | 0.37 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.34 | | | $ | 1.89 | | | | 0.37 | % |
|
FlexShares® International Quality Dividend Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 948.80 | | | $ | 2.31 | | | | 0.47 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.84 | | | $ | 2.40 | | | | 0.47 | % |
|
FlexShares® International Quality Dividend Defensive Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 954.80 | | | $ | 2.32 | | | | 0.47 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.84 | | | $ | 2.40 | | | | 0.47 | % |
|
FlexShares® International Quality Dividend Dynamic Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 943.70 | | | $ | 2.30 | | | | 0.47 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,022.84 | | | $ | 2.40 | | | | 0.47 | % |
|
FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 986.80 | | | $ | 0.90 | | | | 0.18 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.30 | | | $ | 0.92 | | | | 0.18 | % |
| | | | |
528 | | FLEXSHARES ANNUAL REPORT | | |
Fund Expenses (cont.)
| | | | | | | | | | | | | | | | |
| | Beginning Account Value | | | Ending Account Value 10/31/23 | | | Expenses Paid During the Period * | | | Annualized Expense Ratio During Period | |
|
FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 956.80 | | | $ | 0.89 | | | | 0.18 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.30 | | | $ | 0.92 | | | | 0.18 | % |
|
FlexShares® Disciplined Duration MBS Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 964.90 | | | $ | 0.99 | | | | 0.20 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.20 | | | $ | 1.02 | | | | 0.20 | % |
|
FlexShares® Credit-Scored US Corporate Bond Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 973.60 | | | $ | 1.09 | | | | 0.22 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.10 | | | $ | 1.12 | | | | 0.22 | % |
|
FlexShares® Credit-Scored US Long Corporate Bond Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 883.80 | | | $ | 1.00 | | | | 0.21 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.15 | | | $ | 1.07 | | | | 0.21 | % |
|
FlexShares® High Yield Value-Scored Bond Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,000.90 | | | $ | 1.82 | | | | 0.36 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.39 | | | $ | 1.84 | | | | 0.36 | % |
|
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 939.30 | | | $ | 0.59 | | | | 0.12 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,024.60 | | | $ | 0.61 | | | | 0.12 | % |
|
FlexShares® Ultra-Short Income Fund | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 1,026.30 | | | $ | 1.28 | | | | 0.25 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.95 | | | $ | 1.28 | | | | 0.25 | % |
|
FlexShares® Core Select Bond Fund(a) | |
| | | | |
Actual | | $ | 1,000.00 | | | $ | 936.40 | | | $ | 1.27 | | | | 0.26 | % |
| | | | |
Hypothetical | | $ | 1,000.00 | | | $ | 1,023.89 | | | $ | 1.33 | | | | 0.26 | % |
* | Expenses are equal to the average account value over the period multiplied by the Fund’s annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period). |
(a) | Annualized expense ratio and expenses paid during the period do not include fees and expenses of the Underlying Fund(s) in which the Fund invests. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 529 | |
Trustees and Officers (Unaudited)
NON-INTERESTED TRUSTEES
| | | | | | | | | | | | |
Name, Address(1) and Age | | Position(s)
Held with the Trust | | Term of Office and Length of Time Served(2) | | Principal Occupation(s) During Past 5 Years | | Number of Funds in Fund Complex(3) Overseen by Trustee | | | Other Directorships Held by Trustee(4) |
Sarah N. Garvey Year of Birth: 1952 | | Trustee | | July 2011 to present | | • Chairman of the Board of Navy Pier from 2011 to 2013 and Member of the Board from 2011 to 2020; • Member of the Board of Directors of The Civic Federation since 2004; • Member of the Executive Committee and Chairman of the Audit and Risk Committee since 2017 and Trustee of the Art Institute of Chicago since 2011. | | | 30 | | | None |
Philip G. Hubbard Year of Birth: 1951 | | Trustee | | July 2011 to present | | • Managing Partner of Solidian Fund, LP and Solidian Management, LLC (a fund of hedge funds platform for family and friends investments) since 2001; • President of Hubbard Management Group, LLC (a personal investment vehicle) since 2001; • Chairman of the Board of Trustees of the Wheaton College Trust Company, N. A. from 2004 to 2022; • Member of the Board of Trustees of Wheaton College from 1998 to 2022; • Chairman of the Board of Directors of the English Language Institute/China (a nonprofit educational organization) since 1993; • Member of the Board of First Cup, LLC (restaurant franchising) since 2014. | | | 30 | | | None |
| | | | |
530 | | FLEXSHARES ANNUAL REPORT | | |
Trustees and Officers (cont.)
| | | | | | | | | | | | |
Name, Address(1) and Age | | Position(s)
Held with the Trust | | Term of Office and Length of Time Served(2) | | Principal Occupation(s) During Past 5 Years | | Number of Funds in Fund Complex(3) Overseen by Trustee | | | Other Directorships Held by Trustee(4) |
Eric T. McKissack Year of Birth: 1953 | | Trustee and Chairman | | July 2011 to present | | • CEO Emeritus and Founder; CEO and Founder from 2004 to 2020 of Channing Capital Management, LLC (an SEC registered investment adviser); • Member of the Board of Trustees, the Investment Committee, and the Finance Committee of the Art Institute of Chicago since 2002; • Member of the Board of Grand Victoria Foundation since 2011; • Member of the Board of the Graham Foundation since 2014. • Member of the Board of Terra Foundation since 2021 | | | 30 | | | Morgan Stanley Pathway Funds (formerly, Consulting Group Capital Markets Funds) (11 Portfolios) Since April 2013, Farmer Mac (NYSE: AGM) since February 2021 |
| | | | | |
INTERESTED TRUSTEE | | | | | | | | | | | | |
Darek Wojnar(5) Year of Birth: 1965 | | Trustee | | December 2018 to present | | • Director and Executive Vice President, Head of Funds and Managed Accounts, Northern Trust Investments Inc. since 2018; • Managing Member of the Wojnar Group LLC (a publishing industry consulting company) since 2013; • Head of Exchange-Traded Funds at Hartford Funds from2016 to 2017 and Managing Director of Lattice Strategies LLC from 2014 to 2016; • Managing Director and Head of US iShares Product at BlackRock (including Barclays Global Investors acquired by BlackRock) from 2005 to 2013 and the Equity Long/Short Opportunities Fund (formerly, NT Equity Long/Short Strategies Fund) from 2011 to 2019. | | | 30 | | | Northern Funds (43 Portfolios) since January 1, 2019 and Northern Institutional Funds (6 Portfolios) since January 1, 2019 |
(1) | Each Non-Interested Trustee may be contacted by writing to the Trustee, c/o Paulita Pike, Ropes & Gray LLP, 191 North Wacker Drive, 32nd Floor, Chicago, IL 60606. Mr. Wojnar may be contacted by writing to him at 50 S. LaSalle St., Chicago, IL 60603. |
(2) | Each Trustee will hold office for an indefinite term until the earliest of: (i) the next meeting of shareholders, if any, called for the purpose of considering the election or re-election of such Trustee and until the election and qualification of his or her successor, if any, elected at such meeting; or (ii) the date a Trustee resigns or retires, or a Trustee is removed by the Board or shareholders, in accordance with the Trust’s Agreement and Declaration of Trust. |
(3) | The “Fund Complex” consists of the Trust. |
(4) | This column includes only directorships of companies required to report to the SEC under the Securities Exchange Act of 1934, as amended (i.e., public companies) or other investment companies registered under the 1940 Act. |
(5) | An “interested person,” as defined by the 1940 Act. Mr. Wojnar is deemed to be an “interested” Trustee because he is an officer of NTl and its parent company. |
The Statement of Additional Information (“SAI”) includes additional information about the Trust’s Trustees and is available, without charge, upon request by contacting the Fund directly at (855) 933-6287.
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| | FLEXSHARES ANNUAL REPORT | | | 531 | |
Trustees and Officers (cont.)
| | | | | | |
OFFICERS |
Name, Address and Age | | Position(s) Held with the Trust | | Term of Office(1) and Length of Time Served | | Principal Occupation(s) During Past 5 Years |
Darlene Chappell Year of Birth: 1963 50 South LaSalle Street Chicago, IL 60603 | | Anti-Money Laundering Officer | | July 2011 to present | | Anti-Money Laundering Compliance Officer for Northern Trust Investments, Inc., Northern Trust Securities, Inc., Northern Funds, Northern Institutional Funds, and Alpha Core Strategies Fund (formerly NT Alpha Strategies Fund) since 2009, 50 South Capital Advisors, LLC since 2015 and Belvedere Advisors LLC since September 2019; Vice President and Compliance Consultant for The Northern Trust Company since 2006, and the Equity Long/Short Opportunities Fund (formerly NT Equity Long/ Short Strategies Fund) from 2011 to 2019. |
Tim Handell Year of Birth: 1989 50 South LaSalle Street Chicago, IL 60603 | | Assistant Secretary | | December 2022 to present | | Senior Counsel and Senior Vice-President of The Northern Trust Company since November 2021; Assistant Secretary of FlexShares® Trust since December 2022; Assistant General Counsel of Legal & General Investment Management America, Inc. from March 2021 to November 2021; Associate Counsel of Legal & General Investment Management America, Inc. from March 2017 to March 2021. |
Jose J. Del Real, Esq. Year of Birth: 1977 50 South LaSalle Street Chicago, IL 60603 | | Secretary | | December 2018 to present | | Assistant General Counsel and Senior Vice President of The Northern Trust Company since August 2020; Senior Legal Counsel and Senior Vice President of The Northern Trust Company from March 2017 to July 2020; Assistant Secretary of Northern Trust Investments, Inc. since 2016; Secretary of Northern Funds and Northern Institutional Funds since November 2018; Assistant Secretary of Northern Funds and Northern Institutional Funds from 2011 to 2014 and from May 2015 to November 2018; Assistant Secretary of FlexShares Trust from June 2015 to December 2018. |
Maya Teufel Year of Birth: 1972 50 South LaSalle Street Chicago, IL 60603 | | Chief Compliance Officer | | July 2019 to present | | Chief Compliance Officer of FlexShares Trust since July 2019; Chief Compliance Officer of Northern Trust Investments, Inc. since July 2019; Co-Head of U.S. Regulatory Compliance Group of Goldman Sachs Asset Management, LP from September 2016 to June 2019. |
Randal E. Rein Year of Birth: 1970 50 South Lasalle Street Chicago, IL 60603 | | Treasurer and Principal Financial Officer | | July 2011 to present | | Senior Vice President of Northern Trust Investments, Inc. since 2010; Treasurer of Northern Funds and Northern Institutional Funds since 2008; Treasurer of Alpha Core Strategies Fund from 2008 to 2018; Treasurer of Equity Long/Short Opportunities Fund from 2011 to 2018. |
Peter K. Ewing Year of Birth: 1958 50 South LaSalle Street Chicago, IL 60603 | | President | | March 2017 to present | | President of Northern Funds, Northern Institutional Funds and the Trust since March 2017; Vice President of the Trust from July 2011 to February 2017; Director of Product Management, ETFs & Mutual Funds, and Director of Northern Trust Investments, Inc. since March 2017; Senior Vice President of, The Northern Trust Company and Northern Trust Investments, Inc., since September 2010; Director of ETF Product Management of, Northern Trust Investments, Inc. from September 2010 to February 2017. |
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532 | | FLEXSHARES ANNUAL REPORT | | |
Trustees and Officers (cont.)
| | | | | | |
Name, Address and Age | | Position(s) Held with the Trust | | Term of Office(1) and Length of Time Served | | Principal Occupation(s) During Past 5 Years |
Craig R. Carberry, Esq. Year of Birth: 1960 50 South LaSalle Street Chicago, IL 60603 | | Chief Legal Officer | | June 2019 to present | | Chief Legal Officer and Secretary of Northern Trust Investments, Inc. since May 2000; Chief Compliance Officer of Northern Trust Investments, Inc. from October 2015 to June 2017; Chief Legal Officer and Secretary of 50 South Capital Advisors, LLC since 2015; Chief Legal Officer and Secretary of Belvedere Advisors LLC since September 2019; Deputy General Counsel and Senior Vice President of The Northern Trust Company since August 2020; Associate General Counsel and Senior Vice President at The Northern Trust Company from June 2015 to 2021; Secretary of Alpha Core Strategies Fund since 2004; Secretary of Equity Long/Short Opportunities Fund (formerly NT Equity Long/Short Strategies Fund) from 2011-2019; Secretary of Northern Institutional Funds and Northern Funds from 2010-2018; Secretary of FlexShares Trust from 2011-2018. |
Christopher P. Fair Year of Birth: 1982 50 South LaSalle Street Chicago, IL 60603 | | Vice President | | June 2019 to present | | Vice President, The Northern Trust Company since March 2020; ETF Services Manager, Northern Trust Investments, Inc. since June 2019; Second Vice President, The Northern Trust Company from November 2015 to March 2020; ETF Product Manager, Northern Trust Investments, Inc. from November 2015 to June 2019. |
Himanshu S. Surti Year of Birth: 1974 50 South LaSalle Street Chicago, IL 60603 | | Vice President | | December 2020 to present | | Director, ETF Product Management, Northern Trust Investments, Inc. since November 2020; Senior Vice President, The Northern Trust Company since November 2020; Portfolio Manager and Chief Operating Officer, Cambria Investment Management from June 2014 to November 2020; Vice President, Cambria ETF Trust from March 2018 to November 2020. |
(1) | Officers hold office at the pleasure of the Board until their successors are duly elected and qualified, or until their death, resignation, or disqualification. |
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 533 | |
Approval of Advisory Agreement (Unaudited)
The Board of Trustees (the “Board”) of the FlexShares Trust (the “Trust”) oversees the management of the Trust and each separate series of the Trust covered in this report (each, a “Fund” and, collectively, the “Funds”) and, as required by law, determines whether to approve the Trust’s investment advisory and ancillary services agreement (the “Advisory Agreement”) with Northern Trust Investments, Inc. (the “Adviser”), an indirect subsidiary of the Northern Trust Corporation.
* * * * *
At a meeting on June 22, 2023 (the “June Meeting”), the Board, including all of the Trustees who are not parties to the Advisory Agreement or interested persons of any such party (the “Independent Trustees”), considered whether to approve the continuation of the Advisory Agreement between the Adviser and the Trust, on behalf of each Fund.
In advance of, and in preparation for, the Trustees’ consideration of the Advisory Agreement at the June Meeting, the Trustees received written materials relating to the Advisory Agreement and had the opportunity to ask questions and request further information in connection with their consideration. At the June Meeting, the Trustees considered the Adviser’s presentations and discussed all of the information that had been provided. Among other things, the Board considered comparisons with other funds in relevant peer universes and peer groups that had been determined by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of fund data, which included, among other things, the following information: (1) a description of the types of funds chosen by Broadridge to compare to each Fund; (2) comparative performance data for each Fund; (3) data on each Fund’s expenses and fees; and (4) comparative fee data for each Fund’s respective peer group, including comparisons of advisory fees and total expense ratios. In considering the Advisory Agreement, the Independent Trustees met with their independent legal counsel separately from the “interested” Trustee of the Trust and officers and employees of the Adviser. After evaluating all the materials, the Trustees, including the Independent Trustees, concluded that the Advisory Agreement was in the best interest of each of the
Funds and their shareholders and approved the continuation of the Advisory Agreement on behalf of the Funds.
The material factors and conclusions that formed the basis for the Trustees reaching their determination to approve the continuation of the Advisory Agreement are separately discussed below.
Nature, Quality and Extent of Services
The Board examined the nature, quality and extent of the services provided by the Adviser to each Fund. The Board also considered the Adviser’s responsibilities under the Advisory Agreement to perform securities trading services and ancillary services including, among other things: (i) filing reports with the SEC, (ii) periodically updating the Trust’s registration statement, (iii) establishing and maintaining the Funds’ website to comply with regulatory requirements, (iv) monitoring anticipated purchases and redemptions of creation units by shareholders and new investors, (v) providing information and assistance as required by the Trust’s administrator and fund accountant in connection with the Trust’s shares, and (vi) providing assistance in connection with the operations of the Trust generally.
The Board also considered the quality of the Adviser’s resources that are made available to the Trust. The Board noted the Adviser’s and its affiliates’ financial position, stability and commitment to growing their exchange-traded funds (“ETFs”) business. The Board also considered the operation and strength of the Adviser’s compliance program.
The Board noted that Foreside Fund Services, LLC, an entity unaffiliated with the Adviser, provides distribution services to the Funds and that JPMorgan Chase Bank, N.A., also an unaffiliated entity, provides custody, transfer agency, securities lending and fund administration support services, and that these service provider arrangements were relevant to the Board’s considerations of the totality of the circumstances surrounding renewal of the Advisory Agreement. The Board concluded that each Fund benefited from the services provided under the Advisory Agreement and as a result of the Adviser’s operations, resources, experience, reputation and personnel.
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534 | | FLEXSHARES ANNUAL REPORT | | |
Approval of Advisory Agreement (cont.)
Performance, Fees and Expenses
The Board considered that, unlike FlexShares® Ultra-Short Income Fund and FlexShares® Core Select Bond Fund (each, an “Active Fund”), the investment objective of each Fund other than the Active Funds (each, an “Index Fund”) is to seek investment results that correspond generally to the price and yield performance, before fees and expenses, of a specified index (each, an “Underlying Index”). The Board considered the Adviser’s explanation that performance information with respect to funds in relevant peer universes and peer groups selected by Broadridge is only one of several comparative data points and that none of the peer funds sought to track an index that was the same as any Index Fund’s Underlying Index. The Board considered the information that the Adviser provided regarding the difference between each Fund’s performance, after fees and expenses, and the performance of its Underlying Index or benchmark index (as applicable) over certain periods of time, including as noted further below, ended March 31, 2023 (the “Tracking Difference”). The Board considered the Adviser’s expectations for each Index Fund’s Tracking Difference and noted the Adviser’s view that all instances of Tracking Difference for the Index Funds reflect results well within appropriate expectations after taking into account (i) all of the factors that affect Tracking Difference and (ii) the ancillary objectives of minimizing portfolio transaction costs and tax-related inefficiencies.
The Board also considered comparative performance, fee and expense information of each Fund provided by Broadridge. The Broadridge comparisons ranked each Fund in various quintiles over certain periods of time, including as noted further below, ended March 31, 2023, with the first quintile being the lowest or best 20% of the funds in terms of fund cost and fund performance, respectively. The Board noted that, in certain cases, the Broadridge peer funds included funds sponsored by an “at cost” service provider and that there were limitations in providing comparable peer funds.
The Board considered that the Adviser contractually agreed to reimburse the portion of the operating expenses of each Fund until at least March 1, 2024, so that, after such reimbursement, the total annual fund operating expenses of
a Fund, excluding any acquired fund fees and expenses, expressed as a percentage of average daily net assets, does not exceed an amount equal to the sum of (i) the Fund’s advisory fee rate and (ii) 0.0049% (the “Expense Reimbursement Agreement”).
In reaching its determinations, the Board considered a large amount of data provided by the Adviser in response to a written request previously submitted by the Independent Trustees to the Adviser. Among the information considered by the Board was the following information:
Index Funds:
FlexShares® Morningstar US Market Factor Tilt Index Fund (TILT)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by 20 basis points or less for all periods, except for the three-year period in which the Fund’s performance differed from the performance of the Underlying Index by less than 35 basis points. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, number of holdings and approach to portfolio and trade construction.
The Board also considered that the Fund’s performance was in the third quintile of its performance universe for the one-year, five-year and ten-year periods and in the first quintile for the three-year period.
The Board noted that the Fund’s advisory fee net of waivers (“Net Advisory Fee”) was less than one basis point higher than its expense group median, and the Fund’s contractual advisory fee (“Contractual Advisory Fee”) and total expense ratio (which represents the total cost to investors) were below its expense group median.
FlexShares® Morningstar Developed Markets ex-US Factor Tilt Index Fund (TLTD)
The Board considered that the Fund’s performance, after fees and expenses, was above the performance of its Underlying Index for the five-year period and differed from the performance of the Underlying Index by less than 10 basis points for the remaining periods. The Board considered the factors that influenced the Fund’s Tracking Difference
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 535 | |
Approval of Advisory Agreement (cont.)
including, among other things, dividend-related tax differentials, the use of futures, transaction costs and number of holdings.
The Board also considered that the Fund’s performance ranked in the second quintile of its performance universe for the ten-year period, the third quintile for the five-year period, the fourth quintile for the three-year period, and the fifth quintile for the one-year period. The Board considered the Adviser’s assertion that it takes a thoughtful and disciplined approach to portfolio and trade construction to find the optimal balance between the effects of transaction costs and a level of sampling that seek to achieve the characteristics and performance of the benchmark. In this regard, it was noted that having a high number of holdings can increase transaction costs relative to peer funds. The Board also considered the Adviser’s assertion that for the one-year period ended March 31, 2023, securities selection related to market capitalization detracted from performance.
The Board took into account that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 4 basis points of its expense group median.
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (TLTE)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 100 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, the use of futures, transaction costs, securities selection, dividend tax differentials compounding of tracking difference and number of holdings.
The Board noted that the Fund’s performance ranked in the second quintile of its performance universe for the three-year period and in the third quintile for the remaining periods.
The Board and Adviser agreed to a voluntary expense reduction in the management fee for the Fund from 0.59% to 0.57% for one-year, effective June 26, 2023, with a corre-
sponding reduction of the Adviser’s expense limitation agreement with the Fund’s trust.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.15% of its expense group median.
FlexShares® US Quality Large Cap Index Fund (QLC)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its
Underlying Index by 40 basis points or less for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, compounding of tracking difference, transaction costs, the use of futures and securities selection.
The Board noted that the Fund’s performance ranked in the second quintile of its performance universe for the three-year period, the third quintile for the one-year period and the fifth quintile for all remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund’s performance.
FlexShares® STOXX® US ESG Select Index Fund (ESG)
The Board considered that the Fund’s performance, after fees and expenses, was above the performance of its Underlying Index for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including dividend-related tax differentials and transaction costs.
The Board also considered that the Fund’s performance ranked in the first quintile of its performance universe for all periods, except for the one-year period when the Fund’s performance ranked in the third quintile.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund’s performance.
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536 | | FLEXSHARES ANNUAL REPORT | | |
Approval of Advisory Agreement (cont.)
FlexShares® STOXX® Global ESG Select Index Fund (ESGG)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 15 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, dividend-related tax differentials, securities selection, transaction costs and the use of futures.
The Board noted that the Fund’s performance ranked in the first quintile of its performance universe for all periods, except for the one-year period when the Fund’s performance ranked in the fourth quintile.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund’s performance.
FlexShares® Morningstar Global Upstream Natural Resources Index Fund (GUNR)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 90 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, compounding, the use of futures, securities selection, transaction costs, Indian capital gains tax accruals and dividend tax differentials.
The Board also considered that the Fund’s performance ranked in the fourth quintile of its performance universe for the one-year period, in the fifth quintile for the third-year period and in the first quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median.
FlexShares® STOXX® Global Broad Infrastructure Index Fund (NFRA)
The Board considered that the Fund’s performance, after fees and expenses, exceeded the performance of its Under-
lying Index for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, compounding, the use of futures, securities selection, transaction costs, Indian capital gains tax accruals and dividend tax differentials.
The Board considered that the Fund’s performance ranked in the third quintile of its performance universe for the one-year period and in the fourth quintile for all remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund’s performance.
FlexShares® Global Quality Real Estate Index Fund (GQRE)
The Board considered that the Fund’s performance, after fees and expenses, exceeded the performance of its Underlying Index for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, securities selection, dividend-related tax differentials, compounding, transaction costs and the use of futures.
The Board also considered that the Fund’s performance ranked in the fifth quintile of its performance universe for the one-year and five-year periods, in the third quintile for the since inception period, and the fourth quintile for the three-year period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors) and Contractual Advisory Fee were lower than its expense group median while its Net Advisory Fee was equal to its expense group median and considered this in light of the Fund’s performance.
FlexShares® Real Assets Allocation Index Fund (ASET)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by 15 basis points or less for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, the selections for exposure to certain asset classes.
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| | FLEXSHARES ANNUAL REPORT | | | 537 | |
Approval of Advisory Agreement (cont.)
The Board noted that the Fund’s performance was in the fourth quintile of its performance universe for the one-year period, in the third quintile for the three-year period, and in the second quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors) and Net Advisory Fee were lower than its expense group median and the Fund’s Contractual Advisory Fee was higher than its expense group median. The Board noted that the Fund’s Contractual Advisory Fee was within 0.07% of its expense group median Contractual Advisory Fee. The Board also considered that the Adviser had agreed to a contractual expense reduction in the management fee for the Fund from 0.57% to 0.49% per annum, with a corresponding reduction of the Adviser’s expense limitation agreement with the Fund’s trust.
FlexShares® Quality Dividend Index Fund (QDF)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 60 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, transaction costs, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index, and stock selection.
The Board also considered that the Fund’s performance ranked in the second quintile for the ten-year period, in the third quintile for the three-year period, and in the fourth quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were higher than its expense group median.
FlexShares® Quality Dividend Defensive Index Fund (QDEF)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 60 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, transaction costs, stock selection, and the use of broad equity
index futures used to equitize cash and accruals which can perform differently than the Fund’s index.
The Board considered that the Fund’s performance ranked in the second quintile for the one-year and ten-year periods, the third quintile for the five-year period, and the fourth quintile for the three-year period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were higher than its expense group median.
FlexShares® Quality Dividend Dynamic Index Fund (QDYN)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 60 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, stock selection, transaction costs, and the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index.
The Board also considered that the Fund’s performance ranked in the first quintile for the three-year and ten-year periods, in the second quintile for the five-year period, and in the fourth quintile for the one-year period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were higher than its expense group median. The Board also considered that the Fund would be reorganized into the FlexShares Quality Dividend Index Fund (QDF) on or about June 30, 2023.
FlexShares® International Quality Dividend Index Fund (IQDF)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 40 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, Indian capital gains tax accruals, the use of broad equity index futures used to equitize cash and accruals which can perform
| | | | |
538 | | FLEXSHARES ANNUAL REPORT | | |
Approval of Advisory Agreement (cont.)
differently than the Fund’s index, stock selection, dividend tax differentials whereby the Fund may be eligible for different tax withholding and transaction costs.
The Board also considered that the Fund’s performance ranked in the third quintile for the three-year period and the fourth quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.
FlexShares® International Quality Dividend Defensive Index Fund (IQDE)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 50 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, differences in security-level weights relative to the Underlying Index which can be impacted by multiple factors including, but not limited to, pending corporate actions, round lot conventions, multiple share classes, transaction cost minimization, and security specific liquidity constraints, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index trade related stamp taxes in certain foreign jurisdictions and transaction costs.
The Board also considered that the Fund’s performance ranked in the fifth quintile for all periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.
At the June Meeting, the Board was advised by the Adviser that the reorganization of IQDE into FlexShares® International Quality Dividend Index Fund (IQDF) would not occur on or about June 30, 2023 as originally scheduled given that the reorganization would not be able to be consummated at such time as a tax-free reorganization as required by the agreement and plan of reorganization.
FlexShares® International Quality Dividend Dynamic Index Fund (IQDY)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 45 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, dividend tax differentials, differences in security-level weights relative to the Underlying Index which can be impacted by multiple factors including, but not limited to, pending corporate actions, round lot conventions, multiple share classes, transaction cost minimization, and security specific liquidity constraints, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index, trade related stamp taxes in certain foreign jurisdictions and accruals from India capital gains taxes that can differ from the Underlying Index.
The Board also considered that the Fund’s performance ranked in the fourth quintile of its performance universe for the one-year period, in the third quintile for the five-year period, and in the first or second quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.
FlexShares® iBoxx 3-Year Target Duration TIPS Index Fund (TDTT)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 25 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, shifts in interest rates and liquidity and trading costs.
The Board also considered that the Fund’s performance ranked in the first quintile of its performance universe for all periods.
The Board took into account that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than
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| | FLEXSHARES ANNUAL REPORT | | | 539 | |
Approval of Advisory Agreement (cont.)
its expense group median and the Fund’s total expense ratio was within 0.06% of its expense group median.
FlexShares® iBoxx 5-Year Target Duration TIPS Index Fund (TDTF)
The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 30 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, pricing differences, security positioning, liquidity considerations and interest rates.
The Board also considered that the Fund’s performance ranked in the second quintile of its performance universe for the one-year period, in the third quintile for the three-year period, and the first quintile for the remaining periods.
The Board took into account that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and the Fund’s total expense ratio was within 0.06% of its expense group median.
FlexShares® Disciplined Duration MBS Index Fund (MBSD)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less than 80 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, pricing differences and liquidity and trading costs. The Board also considered that the Fund’s Underlying Index generally achieves its target duration with fewer constituents than its peer indices, and that the Adviser utilizes a representative sampling strategy to manage the Fund.
The Board also considered that the Fund’s performance ranked in the first quintile for the one-year period and in the second or third quintile of its performance universe for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were higher than its expense group median. The Board noted its total expense ratio was within 0.17% of its expense group median.
FlexShares® Credit-Scored US Corporate Bond Index Fund (SKOR)
The Board considered the Fund’s performance for the one-, three-, five-year and since inception periods. The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 70 basis points for the one-year period and exceeded the performance of its Underlying Index by more than 200 basis points for the since inception period. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, shifts in interest rates, liquidity and trading costs, security selection, and pricing differences.
The Board also considered that the Fund’s performance ranked in the first quintile for the one-year and five-year periods, in the second quintile for the three-year period, and in the third quintile for the since inception period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.08% of its expense group median. The Board considered this in the context of the Fund’s performance against its Underlying Index.
FlexShares® Credit-Scored US Long Corporate Bond Index Fund (LKOR)
The Board considered the Fund’s performance for the one-, three-, five-year and since inception periods. The Board considered that the Fund’s performance, after fees and expenses, differed from the performance of its Underlying Index by less than 85 basis points for the one-year period and exceeded the performance of its Underlying Index by more than 690 basis points for the since inception period. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, pricing differences, shifts in interest rates, liquidity and trading costs, and security selection. The Board also considered that the Adviser utilizes a representative sampling strategy to manage the Fund.
The Board also considered that the Fund’s performance ranked in the fifth quintile for the one-year and three-year
| | | | |
540 | | FLEXSHARES ANNUAL REPORT | | |
Approval of Advisory Agreement (cont.)
periods, in the third quintile for the five-year period, and the first quintile of its performance universe for the since inception period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its Fund’s total expense ratio was within 0.08% of its expense group median. The Board considered this in the context of the Fund’s performance.
The Board and Adviser agreed to a voluntary expense reduction in the management fee for the Fund from 0.22% to 0.20% for one-year, effective June 26, 2023, with a corresponding reduction of the Adviser’s expense limitation agreement with the Fund’s trust.
FlexShares® High Yield Value-Scored Bond Index Fund (HYGV)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less than 180 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, liquidity and trading costs, shifts in interest rates, security selection and pricing differences.
The Board also considered that the Fund’s performance ranked in the fifth quintile of its performance universe for the one-year period and in the second quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.03% of its expense group median.
The Board and Adviser agreed to a voluntary expense reduction in the management fee for the Fund from 0.37% to 0.35% for one-year, effective June 26, 2023, with a corresponding reduction of the Adviser’s expense limitation agreement with the Fund’s trust.
FlexShares® US Quality Low Volatility Index Fund (QLV)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by 30
basis points or less for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, the compounding effect of tracking error in periods of high volatility, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index, and transaction costs.
The Board also considered that the Fund’s performance ranked in the first quintile of its performance universe for the one-year period, the fourth quintile for the three-year period, and the third quintile for the since inception period.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
FlexShares® Developed Markets ex-US Quality Low Volatility Index Fund (QLVD)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less than 25 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, dividend tax differential, stock selection, transaction costs, and the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index.
The Board also considered that the Fund’s performance ranked in the third quintile of its performance universe for the one-year period and in the fifth quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors) and Net Advisory Fee were higher than its expense group median, while its Contractual Advisory Fee was lower than its expense group median. The Board noted that the Fund’s Net Advisory Fee was within 0.01% of its expense group median.
FlexShares® Emerging Markets Quality Low Volatility Index Fund (QLVE)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less
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| | FLEXSHARES ANNUAL REPORT | | | 541 | |
Approval of Advisory Agreement (cont.)
than 90 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, , the use of broad equity index futures to equitize cash and accruals, Indian capital gains tax accruals, transaction costs, stock selection, and compounding of tracking difference.
The Board also considered that the Fund’s performance ranked in the second quintile of its performance universe for the one-year period and in the fourth quintile for the remaining periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
FlexShares® ESG & Climate Developed Markets ex-US Core Index Fund (FEDM)
The Board considered that the Fund’s performance, after fees and expenses, exceeded its Underlying Index by three basis points for the one-year period and more than five basis points since inception. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, dividend tax differential, stock selection, transaction costs, the compounding of tracking difference, and the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index.
The Board also considered that the Fund’s performance ranked in the fourth quintile of its performance universe for the one-year period and in the third quintile since inception. Further, the Board considered the Fund’s relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund’s performance record.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
FlexShares® ESG & Climate US Large Cap Core Index Fund (FEUS)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less than 15 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, transaction costs, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund’s index, and compounding of tracking difference.
The Board also considered that the Fund’s performance ranked in the second quintile of its performance universe since inception and in the third quintile for the one-year period. Further, the Board considered the Fund’s relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund’s performance record.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (FEIG)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by 55 basis points or less for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, differences in pricing sources, liquidity and trading costs, shifts in interest rates, and security selection.
The Board also considered that the Fund’s performance ranked in the third quintile of its performance universe for all periods. Further, the Board considered the Fund’s relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund’s performance record.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
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542 | | FLEXSHARES ANNUAL REPORT | | |
Approval of Advisory Agreement (cont.)
FlexShares® ESG & Climate High Yield Corporate Core Index Fund (FEHY)
The Board considered that the Fund’s performance, after fees and expenses, differed from its Underlying Index by less than 80 basis points for all periods. The Board considered the factors that influenced the Fund’s Tracking Difference including, among other things, differences in pricing sources, liquidity and trading costs, shifts in interest rates, and security selection.
The Board also considered that the Fund’s performance ranked in the fourth quintile of its performance universe for all periods.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
The Board considered that the Fund was scheduled to be liquidated on or about July 10, 2023.
FlexShares® ESG & Climate Emerging Markets Core Index Fund (FEEM)
The Board considered the Fund’s performance, after fees and expenses, equaled its Underlying Index since inception. The Board also considered that the Fund’s performance ranked in the fourth quintile of its performance universe since inception. Further, the Board considered the Fund’s relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund’s performance record.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.
Active Funds:
FlexShares® Ultra-Short Income Fund (RAVI)
The Board considered that the Fund’s performance ranked in the third quintile for the one-year and three-year periods and the second quintile for the remaining periods. The Board also considered that the Fund outperformed its
benchmark index for the three-, five-and ten-year periods and underperformed its benchmark index for the one-year period The Board also considered information provided by the Adviser with regard to the Fund’s performance against certain peer funds identified by the Adviser. In this regard, the Board considered the Adviser’s assertion that consistent with the Adviser’s capital market assumptions, the Fund’s portfolio composition has generally been characterized by longer duration and higher credit quality than certain peer funds.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and the Fund’s total expense ratio was within 0.06% of its expense group median.
FlexShares® Core Select Bond Fund (BNDC)
The Board considered that the Fund’s performance ranked in the second quintile for the one-year period and in the third or fourth quintile of its performance universe for the remaining periods. The Board also considered that the Fund outperformed its benchmark index for the three-year period and underperformed its benchmark index for all remaining periods. The Board also considered information provided by the Adviser with regard to the Fund’s performance against certain peer funds identified by the Adviser. In this regard, the Board considered the Adviser’s assertion that relative to such peers, the Fund has historically been overweight to treasury securities and investment grade corporate bonds and, as such, the peer funds have historically benefited during risk-on market environments through heavier allocations to securitized debt instruments and lower credit quality securities.
The Board considered that the Fund’s total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median. The Board also considered that the Adviser had agreed to waive a portion of its advisory fee and/or reimburse operating expenses in an amount equal to any acquired fund fees and expenses incurred by the Fund that were attributable to its investment in other Funds.
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| | FLEXSHARES ANNUAL REPORT | | | 543 | |
Approval of Advisory Agreement (cont.)
Costs of Services and Profits of the Adviser
The Board considered the unitary fee structure and the expenses for each Fund and noted that, under the Advisory Agreement, the Adviser was responsible for most expenses of the Funds, including the cost of transfer agency, custody, fund administration, legal, audit and other services. The Board considered that the Adviser was not responsible under the Advisory Agreement for certain expenses, including the fees and expenses of the Trust’s Independent Trustees and their independent legal counsel, litigation expenses and other extraordinary expenses.
The Board considered the advisory fee for each Fund as compared to that of other comparable funds in relation to its respective Broadridge median. The Board considered the Adviser’s explanation that each Index Fund’s advisory fee (both gross and net of waivers) compared favorably with its respective Broadridge median advisory fee (both gross and net of waivers) for comparable funds set forth in the Broadridge report, especially taking into account, among other factors, important differences between the indexes upon which such comparable funds are based and each Index Fund’s Underlying Index, including in certain cases differences between the number of portfolio holdings for comparable funds and the Funds. The Board considered the advisory fee schedules for other accounts with similar investment advisory mandates as those of the Funds, noting that there were no comparable accounts for certain of the Funds. The Board considered (a) the differences in managing ETFs versus separately managed accounts which involve daily purchase and redemption activity along with robust regulatory and governance requirements; and (b) the Funds’ unitary fee structure.
The Board examined the Adviser’s profitability information provided by the Adviser, and the Trustees considered that the Adviser was profitable on a pre-distribution basis but not on a post-distribution basis. The Board considered that the Adviser’s potential for profitability would continue to be subject to financial uncertainties and risks. The Board also considered that the Adviser would continue to develop and offer additional new products in efforts to complete the overall integrity of the Trust’s product suite, consistent with
its product strategy, and that these products may expose the Adviser to additional financial risks and uncertainties.
Economies of Scale
The Board considered whether the Adviser may realize economies of scale in managing and supporting the Funds. The Board reviewed each Fund’s fee arrangements, which did not include breakpoints, and considered that, in light of the unitary fee structure, the Adviser’s profitability from its services to the Trust and the significant investment that the Adviser had made and continues to make in the Trust, breakpoints were not necessary at this time. The Board also noted the Expense Reimbursement Agreement.
Other Benefits to the Adviser
In addition to considering the profits that may be realized by the Adviser, the Board considered information regarding other direct and indirect benefits the Adviser may receive as a result of its relationship with the Funds, including whether any compensation would be paid to its affiliates. The Board also considered that some of the Funds’ shareholders have other client relationships with the Adviser or its affiliates. The Board also reviewed the extent to which the Adviser and its other clients, as well as the Funds, benefit from receipt of the research products and services generated by the Funds.
The Board, including the Independent Trustees, considered the data provided by the Adviser and concluded that sufficient information had been provided to allow them to evaluate the terms of the Advisory Agreement and each Fund’s investment advisory fee. They determined that each Fund’s advisory fee was reasonable in light of the services provided and the performance achieved by the Fund.
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544 | | FLEXSHARES ANNUAL REPORT | | |
Supplemental Information (Unaudited)
Premium/Discount Information
Information about the differences between the daily market prices on secondary markets for shares of the Funds and the Funds’ net asset values for various time periods, as applicable, is available by visiting the Funds’ website at flexshares.com
| | | | | | |
| | FLEXSHARES ANNUAL REPORT | | | 545 | |
For More Information (Unaudited)
Portfolio Holdings
FlexShares® Trust files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year an exhibit to its reports on Form N-PORT. The Funds’ Forms N-PORT are available on the SEC’s website at sec.gov.
Proxy Voting
FlexShares® Trust Proxy Voting Policies and Procedures are available upon request and without charge by calling 1-855-FLEXETF (1-855-353-9383) or by visiting the Funds’ website flexshares.com or the SEC’s website at sec.gov. Each Fund’s portfolio securities voting record for the 12-month period ended June 30 is available upon request and without charge by calling 1-855-FLEXETF (1-855-353-9383) or by visiting the SEC’s website at sec.gov.
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546 | | FLEXSHARES ANNUAL REPORT | | |
FlexShares® Trust
50 S. LaSalle Street
Chicago, IL 60603
800.595.9111
www.flexshares.com
FlexShares® is a registered trademark of NTI. Morningstar® is a registered trademark of Morningstar, Inc. (“Morningstar”). Morningstar® US Market Factor Tilt IndexSM, Morningstar® Developed Markets ex-US Factor Tilt IndexSM, Morningstar® Emerging Markets Factor Tilt IndexSM, and Morningstar® Global Upstream Natural Resources IndexSM are service marks of Morningstar, Inc. STOXX and its licensors (the “Licensors”) have no relationship to FlexShares® Trust other than the licensing of the STOXX® USA ESG Select KPIs Index, STOXX® Global ESG Select KPIs Index and STOXX® Global Broad Infrastructure Index and the related trademarks for use in connection with the FlexShares® STOXX® US ESG Select Index Fund, FlexShares® STOXX® Global ESG Select Index Fund and FlexShares® STOXX® Global Broad Infrastructure Index Fund, respectively. The iBoxx 3-Year Target Duration TIPS Index and iBoxx 5-Year Target Duration TIPS Index are each the property of Markit North America, Inc. (“Markit”) and have been licensed for use in connection the FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, respectively. Northern Trust Quality Low Volatility IndexSM, Northern Trust Developed Markets ex-US Quality Low Volatility IndexSM, Northern Trust Emerging Markets Quality Low Volatility IndexSM, Northern Trust Quality Large Cap IndexSM, Northern Trust Quality Dividend IndexSM, Northern Trust Quality Dividend Defensive IndexSM, Northern Trust International Quality Dividend IndexSM, Northern Trust International Quality Dividend Defensive IndexSM, Northern Trust Global Quality Real Estate IndexSM, Northern Trust Credit-Scored US Corporate Bond IndexSM, Northern Trust Credit-Scored US Long Corporate Bond IndexSM, Northern Trust Real Assets Allocation IndexSM, Northern Trust High Yield US Corporate Bond IndexSM, and Northern Trust High Yield Value-Scored US Corporate Bond IndexSM are service marks of NTI and have been licensed for use by FlexShares Trust. The ICE® BofA® Constrained Duration US Mortgage Backed Securities IndexSM are trademarks of ICE Data Indices, LLC or its affiliates (“ICE”) and have been licensed for use by NTI.
FS00058-1223
b.) | A copy of the notice transmitted to shareholders in reliance on Rule 30e-3 under the 1940 Act that contains disclosures specified by paragraph (c)(3) of that rule. Not applicable. |
Item 2. Code of Ethics.
(a) | As of the end of the period, October 31, 2023, the Registrant has adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Registrant or a third party (the “Code of Ethics”). |
(c) | The Registrant has amended its Code of Ethics during the period covered by this report. |
(d) | The Registrant has not granted any waivers, including an implicit waiver, from any provisions of its Code of Ethics during the period covered by this report. |
(f) | A copy of the Registrant’s Code of Ethics is attached as exhibit 13(a)(1) to this Form N-CSR. |
Item 3. Audit Committee Financial Expert.
The Registrant’s Board of Trustees has determined that the Registrant has at least one “audit committee financial expert” (as defined in Item 3 of Form N-CSR), serving on its audit committee. Philip G. Hubbard is the “audit committee financial expert” and is “independent” (as each term is defined in Item 3 of Form N-CSR).
Under applicable securities laws and regulations, a person who is determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for purposes of Section 11 of the Securities Act of 1933, as amended, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liability that are greater than the duties, obligations, and liability imposed on such person as a member of the Registrant’s Audit Committee and Board of Trustees in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations or liability of any other member of the Registrant’s Audit Committee or Board of Trustees.
Item 4. Principal Accountant Fees and Services.
In response to Items 4(a)-4(d), aggregate fees for professional services rendered for FlexShares® Trust by Deloitte & Touche, LLP (“Deloitte”) for the fiscal years ended October 31, 2023 and October 31, 2022 were:
| | | | | | | | |
| | 2023 | |
| | All fees and services to the Trust that were pre-approved | | | All fees and services to Service Affiliates(a) that were pre- approved | |
Audit Fees | | $ | 727,500 | | | | N/A | |
Audit Related Fees(b) | | $ | 0 | | | $ | 0 | |
Tax Fees(c) | | $ | 84,630 | (1) | | $ | 0 | |
All Other Fees(d) | | $ | 0 | | | $ | 0 | |
| | | | | | | | |
Total: | | $ | 812,130 | | | $ | 0 | |
| | | | | | | | |
| | | | | | | | |
| | 2022 | |
| | All fees and services to the Trust that were pre-approved | | | All fees and services to Service Affiliates(a) that were pre- approved | |
Audit Fees | | $ | 736,000 | | | | N/A | |
Audit Related Fees(b) | | $ | 0 | | | $ | 0 | |
Tax Fees(c) | | $ | 83,200 | (1) | | $ | 0 | |
All Other Fees(d) | | $ | 0 | | | $ | 0 | |
| | | | | | | | |
Total: | | $ | 819,200 | | | $ | 0 | |
| | | | | | | | |
(1) | Amounts relate to tax fees for the review of federal income tax returns, excise tax returns and year end distribution calculations. |
(a) | “Service affiliates” as it relates to the aggregate “Audit Fees,” “Audit-Related Fees,” “Tax Fees” and “All Other Fees” that were billed by Deloitte for the periods ended October 31, 2023 and October 31, 2022 are Northern Trust Investments, Inc. (“NTI”) and entities controlling, controlled by or under common control with NTI that provide ongoing services to the Registrant. |
(b) | “Audit-Related Fees” are fees for assurance and related services rendered by Deloitte that are reasonably related to the performance of the audit or review of the Registrant’s financial statements, but not reported as “Audit Fees.” |
(c) | “Tax Fees” are fees for professional services rendered by Deloitte for tax compliance, tax advice and tax planning. |
(d) | “All Other Fees” are for products and services provided by Deloitte other than those reported as Audit, Audit-Related or Tax Fees. |
(e)(1) | The Registrant’s Audit Committee Charter provides that the Audit Committee is responsible for the approval of, prior to the appointment of, the engagement of the principal accountant to annually audit the Registrant’s financial statements. The Audit Committee must also pre-approve the engagement of the principal accountant to provide non-audit services to the Registrant, NTI or to any entity controlling, controlled by or under common control with NTI that provides ongoing services to the Registrant, if the engagement has a direct impact on the operations or financial reporting of the Registrant. The pre-approvals may be delegated to a designated representative (or representatives) of the audit committee and such pre-approvals and approvals must be reported to the full Audit Committee at its next meeting. Each designated representative must be a member of the Audit Committee. |
(e)(2) | No percentage of the principal accountant’s fees or services were approved pursuant to the waiver provision of paragraph (c)(7)(i)(C) or (c)(7)(ii) of Rule 2-01 of Regulation S-X. |
(g) | The aggregate non-audit fees and services billed by Deloitte for services rendered to the Registrant and Service Affiliates for the periods ended October 31, 2023 and October 31, 2022, respectively, were $6,776,921 and $2,200,436. |
(h) | The Registrant’s Audit Committee has considered whether the provision of non-audit services to Service Affiliates, not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, is compatible with maintaining the registered public accountant’s independence in performing audit services. |
Item 5. Audit Committee of Listed Registrants.
(a) | The Registrant has a separately-designated standing Audit Committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934. All of the Board’s independent Trustees, Philip G. Hubbard, Eric T. McKissack and Sarah N. Garvey, are members of the Audit Committee. |
Item 6. Investments.
(a) | Schedule I – Investments in Securities of Unaffiliated Issuers. |
The complete schedule of investments is included in the report to shareholders in Item 1 of this Form N-CSR.
(b) | Securities divested of in accordance with Section 13(c) of the 1940 Act. |
Not Applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not Applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not Applicable.
Item 9. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not Applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees.
Item 11. Controls and Procedures.
(a) | The Registrant’s principal executive officer and principal financial officer, or persons performing similar functions, have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the 1940 Act are effective, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 as of a date within 90 days of the filing date of this report. |
(b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a—3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not Applicable.
Item 13. Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | |
FlexShares® Trust |
| |
By: | | /s/ Peter Ewing |
| | Peter K. Ewing |
| | President and Principal Executive Officer |
| | January 5, 2024 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| | |
By: | | /s/ Peter Ewing |
| | Peter K. Ewing |
| | President and Principal Executive Officer |
| | January 5, 2024 |
| |
By: | | /s/ Randal Rein |
| | Randal E. Rein |
| | Treasurer and Principal Financial Officer |
| | January 5, 2024 |