BlackRock 20/80 Target Allocation Fund, Investor A (BACPX) N-CSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORMN-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT

COMPANIES

Investment Company Act file number:811-05742

Name of Fund:  BlackRock Funds

  BlackRock Tactical Opportunities Portfolio

Fund Address:    100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Funds, 55 East 52^ndStreet, New York, NY 10055

Registrant’s telephone number, including area code: (800)441-7762

Date of fiscal year end: 09/30/2019

Date of reporting period: 03/31/2019

Item 1 – Report to Stockholders

MARCH 31, 2019

SEMI-ANNUAL REPORT (UNAUDITED)

BlackRock Funds^SM

^Ø  BlackRock Tactical Opportunities Fund

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

You may elect to receive all future reports in paper free of charge. If you hold accounts directly with BlackRock, you can call (800) 441-7762 to inform BlackRock that you wish to continue receiving paper copies of your shareholder reports. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds advised by BlackRock Advisors, LLC, BlackRock Fund Advisors or their affiliates, or all funds held with your financial intermediary, as applicable.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by: (i) accessing the BlackRock website at www.blackrock.com/edelivery and logging into your accounts, if you hold accounts directly with BlackRock, or (ii) contacting your financial intermediary, if you hold accounts through a financial intermediary. Please note that not all financial intermediaries may offer this service.

Not FDIC Insured • May Lose Value • No Bank Guarantee

The Markets in Review

Dear Shareholder,

In the 12 months ended March 31, 2019, the U.S. equity and bond markets posted positive returns while weathering significant volatility. Though the market’s appetite for risk remained healthy for most of the reporting period, risk taking declined sharply in late 2018. Thereafter, global equity markets rebounded strongly, as inflation diminished and the U.S. Federal Reserve (the “Fed”) announced a shift to less restrictive monetary policy.

Volatility rose in emerging market stocks, as the rising U.S. dollar and higher interest rates in the U.S. disrupted economic growth abroad. U.S.-China trade relations and debt concerns adversely affected the Chinese stock market, while Turkey and Argentina became embroiled in currency crises, largely due to hyperinflation in both countries. An economic slowdown in Europe also led to negative performance for European equities. However, recent economic data indicates that Europe may emerge from its economic soft patch, reinvigorated by a manufacturing rebound and China’s economic stimulus.

Volatility in the U.S. equity market spiked in October, as a wide range of risks were brought to bear on markets, ranging from rising interest rates and slowing global growth to heightened trade tensions and political turmoil in several countries, including the United States. These risks manifested in a broad-basedsell-off in December, leading to the worst December performance on record since 1931.

By comparison, fixed income securities delivered modest positive returns with relatively low volatility. In fixed income markets, short-term U.S. Treasury yields rose the fastest, while longer-term yields declined slightly. This led to positive returns for U.S. Treasuries and a substantial flattening of the yield curve. Investment-grade and high-yield corporate bonds also posted positive returns, as the credit fundamentals in corporate markets remained relatively solid.

The Fed increased short-term interest rates three times during the reporting period. For its last two meetings, the Fed left interest rates unchanged and signaled a slower pace of rate hikes in response to the global economic slowdown. Relatively low inflation and modest economic growth give the Fed room to maintain support for the economy until the economic data builds the case for changing interest rates.

Although fears of recession drove equity volatility higher at the end of 2018, we continue to believe the probability of recession in 2019 remains relatively low. Economic growth and global earnings are likely to slow somewhat in 2019 because the tax cut stimulus will be less pronounced, and the Fed’s rate hikes in 2018 will gain traction in 2019. We expect profit margins to continue to contract, which tends to happen late in the business cycle.

In addition, trade frictions look more baked into asset prices than a year ago, but markets may be overlooking European political risks. As Brexit moves forward, the United Kingdom and the European Union may face significant obstacles. Most recently, Britain’s Parliament voted to extend the deadline for the separation, as policy makers continue to seek the least disruptive ways to disentangle Europe’s second-largest economy from the European Union. U.S. and emerging market equities remain relatively attractive. Within U.S. equities, we believe that companies with high-quality earnings and strong balance sheets offer the most attractive risk/rewardtrade-off.

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

Sincerely,

Rob Kapito

President, BlackRock Advisors, LLC

Rob Kapito

President, BlackRock Advisors, LLC

Total Returns as of March 31, 2019
	6-month	12-month
U.S. large cap equities (S&P 500® Index)	(1.72)%	9.50%
U.S. small cap equities (Russell 2000® Index)	(8.56)	2.05
International equities (MSCI Europe, Australasia, Far East Index)	(3.81)	(3.71)
Emerging market equities (MSCI Emerging Markets Index)	1.71	(7.41)
3-month Treasury bills (ICE BofAML3-Month U.S. Treasury Bill Index)	1.17	2.12
U.S. Treasury securities (ICE BofAML10-Year U.S. Treasury Index)	7.08	5.59
U.S. investment grade bonds (Bloomberg Barclays U.S. Aggregate Bond Index)	4.63	4.48
Tax-exempt municipal bonds (S&P Municipal Bond Index)	4.32	5.12
U.S. high yield bonds (Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index)	2.39	5.93
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

2 THIS PAGEISNOT PARTOF YOUR FUND REPORT

Table of Contents

	Page
The Markets in Review		2
Semi-Annual Report:
Fund Summary		4
About Fund Performance		6
Disclosure of Expenses		6
Derivative Financial Instruments		6
Financial Statements:
Schedule of Investments		7
Statement of Assets and Liabilities		23
Statement of Operations		24
Statements of Changes in Net Assets		25
Financial Highlights		26
Notes to Financial Statements		31
Trustee and Officer Information		43
Additional Information		44
Glossary of Terms Used in this Report		46

3

Fund Summary  as of March 31, 2019 BlackRock Tactical Opportunities Fund

Investment Objective

BlackRock Tactical Opportunities Fund’s (the “Fund”) investment objective is to seek total return.

Portfolio Management Commentary

How did the Fund perform?

For the six-month period ended March 31, 2019, the Fund underperformed its reference benchmark (75% Bloomberg Barclays U.S. 1-3 Year Treasury Bond Index/25% MSCI All Country World Index (“ACWI”)). For the same period, the Fund also underperformed its cash benchmark, the ICE BofAML 3-Month U.S. Treasury Bill Index.

What factors influenced performance?

The Fund’s relative value positions in fixed income detracted from results, as did its positioning in currencies and equities.

In fixed income, a short position in India (paired against a long position in South Africa) weighed on returns as the Reserve Bank of India lowered interest rates in response to weaker headline inflation. In currencies, a short position in the British pound, which was motivated by deteriorating U.K. macro data related to Brexit uncertainty, was the largest detractor.

The major positive contributors included long positions in U.S. equities and bonds in the first quarter of 2019. A long tilt to global developed market bonds further aided returns, as central banks became more dovish due to broad-based weakness in economic growth. Relative value equity positioning also boosted results, with a preference for core Europe versus the periphery and the United States driving most of the contribution.

During the period, the investment adviser used derivatives as an efficient means to take active views on interest rates, equity indices and currencies. The use of derivatives instead of physical instruments had a positive impact on Fund performance.

Describe recent portfolio activity.

The Fund entered the period net long to global equities and net short to duration (interest rate sensitivity). The equity positioning was largely held as part of a high-conviction, macro theme regarding reflationary pressures and the market’s mispricing of macroeconomic data. While the long position in equities weighed on Fund returns when stocks sold off in late 2018, the investment adviser retained the position. As a result, the Fund was able to benefit from the subsequent rally. The Fund closed out these positions at a profit late in the period.

In fixed income, the Fund built a net long to duration (above-average interest rate sensitivity) early in the period and held it through the end of March. While a broad-based long tilt to global developed market bonds drove much of the increase in duration, the composition of the positioning changed during the course of the period. In January, the Fund pared back large intra-emerging markets views — including a short in India against longs in South Africa and Mexico, as well as a long in South Korea against Asia ex-Japan — in order to minimize further losses. Meanwhile, a bearish view on the U.K. economy (resulting from Brexit uncertainty) motivated the Fund to establish a long in U.K. bonds. The Fund neutralized much of the Europe-related risk associated with this position by establishing a short in Europe, thereby isolating U.K.-specific performance.

In currencies, the Fund maintained a long position in the Australian dollar throughout the period. However, several other aspects of its positioning changed materially. In mid-March, the Fund shifted from a long position in the U.S. dollar against the Chinese yuan into a long position in the Yuan. Strong Chinese economic data, together with the lack of an immediate shift in asset prices in reaction to the improved numbers, drove this change. The Fund also added a short position in the British pound in January.

As of March 31, 2019, the Fund held a higher allocation to cash as a means of reducing overall portfolio volatility. The cash weighting did not have a material impact on Fund performance.

Describe portfolio positioning at period end.

The Fund had net long positions in both global equities and bonds. The investment adviser preferred core European stocks over the periphery and other developed markets, including the United States and Australia. In fixed income, the Fund was long in U.K. bonds due to policy insights and negative growth. This was largely offset by short positions elsewhere in Europe. In currencies, the Fund was overweight in the Australian dollar and Chinese yuan and underweight in the British pound and Japanese yen.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions.

These views are not intended to be a forecast of future events and are no guarantee of future results.

4 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Fund Summary  as of March 31, 2019 (continued) BlackRock Tactical Opportunities Fund

Performance Summary for the Period Ended March 31, 2019

				Average Annual Total Returns (a)(b)
				1 Year						5 Years						10 Years
	6-Month Total Returns			w/o sales charge			w/sales charge			w/o sales charge			w/sales charge			w/o sales charge			w/sales charge
Institutional		(0.86	)%		2.80	%		N/A			3.14	%		N/A			8.07	%		N/A
Service		(1.09	)		2.46			N/A			2.83			N/A			7.76			N/A
Investor A		(1.04	)		2.51			(2.88	)%		2.82			1.72	%		7.74			7.16	%
Investor C		(1.39	)		1.77			0.83			2.12			2.12			7.00			7.00
Class K		(0.84	)		2.97			N/A			3.02			N/A			7.85			N/A
Bloomberg Barclays U.S.1-3 Year Treasury Bond Index(c)		2.32			2.73			N/A			0.98			N/A			1.04			N/A
ICE BofAML3-Month U.S. Treasury Bill Index(d)		1.17			2.12			N/A			0.74			N/A			0.43			N/A
75% Bloomberg Barclays U.S.1-3 Year Treasury Bond Index/25% MSCI ACWI(e)		1.37			2.89			N/A			2.44			N/A			3.87			N/A
MSCI ACWI(f)		(2.13	)		2.60			N/A			6.45			N/A			11.98			N/A

^(a) Assuming maximum sales charges, if any. Average annual total returns with and without sales charges reflect reductions for distribution and service fees. See “About Fund Performance” on page 6 for a detailed description of share classes, including any related sales charges and fees, and how performance was calculated for certain share classes.

^(b) The Fund uses an asset allocation strategy, investing varying percentages of its portfolio in three major categories: stocks, bonds and money market instruments. The Fund’s total returns from May 15, 2012 through January 28, 2016 are the returns of the Fund when it followed different investment strategy by investing a significant portion of its assets in other investment companies and directly in securities. The Fund’s total returns prior to May 15, 2012 are the returns of the Fund when it followed different investment strategies under the name BlackRock Asset Allocation Portfolio.

^(c) Asub-index of the Bloomberg Barclays U.S. Treasury Index, which measures U.S. dollar denominated, fixed-rate, nominal debt issued by the U.S. Treasury and includes a maturity constraint of at least one year and up to, but not including, three years until final maturity.

^(d) An unmanaged index that tracks3-month U.S. Treasury securities.

^(e) A customized weighted index comprised of 75% Bloomberg Barclays U.S.1-3 Year Treasury Bond Index and 25% MSCI ACWI.

^(f) A free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI consists of 47 country indexes comprising of 23 developed and 24 emerging market country indexes.

N/A — Not applicable as share class and index do not have a sales charge.

Past performance is not indicative of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Expense Example

	Actual						Hypothetical (a)
	Beginning Account Value (10/01/18)		Ending Account Value (03/31/19)		Expenses Paid During the Period (b)		Beginning Account Value (10/01/18)		Ending Account Value (03/31/19)		Expenses Paid During the Period (b)		Annualized Expense Ratio
Institutional	$	1,000.00	$	991.40	$	3.82	$	1,000.00	$	1,021.09	$	3.88		0.77	%
Service		1,000.00		989.10		5.55		1,000.00		1,019.35		5.64		1.12
Investor A		1,000.00		989.60		5.61		1,000.00		1,019.30		5.69		1.13
Investor C		1,000.00		986.10		9.11		1,000.00		1,015.76		9.25		1.84
Class K		1,000.00		991.60		3.48		1,000.00		1,021.44		3.53		0.70

^(a)  Hypothetical 5% annual return before expenses is calculated by prorating the number of days in the most recent fiscal half year divided by 365.

^(b)  For each class of the Fund, expenses are equal to annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 182/365 (to reflect theone-half year period shown).

See “Disclosure of Expenses” on page 6 for further information on how expenses were calculated.

Portfolio Information

TOP TEN HOLDINGS

Ten Largest Holdings	Percent of Net Assets
U.S. Treasury Notes		15.1	%
U.S. Treasury Bonds		3.7
Amazon.com, Inc.		1.2
Microsoft Corp.		1.1
Home Depot, Inc. (The)		1.0
Fluor Corp.		1.0
Apple, Inc.		0.9
Johnson & Johnson		0.7
International Paper Co.		0.6
Lowe’s Cos., Inc..		0.6

PORTFOLIO COMPOSITION

Asset Type	Percent of Net Assets
Common Stocks		50	%
U.S. Treasury Obligations		19
Asset-Backed Securities . . . . . . . . . . . . . . . . . .		—	(a)
Other Interests		—	(a)
Preferred Stocks		—	(a)
Short-Term Securities		4
Other Assets Less Liabilities		27

^(a)  Represents less than 1% of the Fund’s net assets.

FUND SUMMARY 5

About Fund Performance

Institutional and Class K Shares are not subject to any sales charge. These shares bear no ongoing distribution or service fees and are available only to certain eligible investors. Class K Share performance shown prior to the August 1, 2016 inception date is that of Investor A Shares. The performance of the Fund’s Class K Shares would be substantially similar to Investor A Shares because Class K Shares and Investor A Shares invest in the same portfolio of securities and performance would only differ to the extent that Class K Shares and Investor A Shares have different expenses. The actual returns of Class K Shares would have been higher than those of the Investor A Shares because Class K Shares have lower expenses than the Investor A Shares.

Service Shares are not subject to any sales charge. These shares are subject to a service fee of 0.25% per year (but no distribution fee) and are only available to certain eligible investors.

Investor A Shares are subject to a maximum initial sales charge(front-end load) of 5.25% and a service fee of 0.25% per year (but no distribution fee). Certain redemptions of these shares may be subject to a contingent deferred sales charge (“CDSC”) where no initial sales charge was paid at the time of purchase. These shares are generally available through financial intermediaries.

Investor C Shares are subject to a 1.00% CDSC if redeemed within one year of purchase. In addition, these shares are subject to a distribution fee of 0.75% per year and a service fee of 0.25% per year. These shares are generally available through financial intermediaries. Effective November 8, 2018, the Fund adopted an automatic conversion feature whereby Investor C Shares held for approximately ten years will be automatically converted into Investor A Shares, and, thereafter, investors will be subject to lower ongoing fees.

Performance information reflects past performance and does not guarantee future results. Current performance may be lower or higher than the performance data quoted. Refer towww.blackrock.com to obtain performance data current to the most recentmonth-end. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Figures shown in the performance table on the previous page assume reinvestment of all distributions, if any, at net asset value (“NAV”) on theex-dividend date. Investment return and principal value of shares will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Distributions paid to each class of shares will vary because of the different levels of service, distribution and transfer agency fees applicable to each class, which are deducted from the income available to be paid to shareholders.

BlackRock Advisors, LLC (the “Manager”), the Fund’s investment adviser, has contractually agreed to waive and/or reimburse a portion of the Fund’s expenses. Without such waiver and/or reimbursement, the Fund’s performance would have been lower. The Manager is under no obligation to continue waiving and/or reimbursing its fees after the applicable termination date of such agreement. See Note 6 of the Notes to Financial Statements for additional information on waivers and/or reimbursements.

Disclosure of Expenses

Shareholders of the Fund may incur the following charges: (a) transactional expenses, such as sales charges; and (b) operating expenses, including investment advisory fees, service and distribution fees, including12b-1 fees, acquired fund fees and expenses, and other fund expenses. The expense example on the previous page (which is based on a hypothetical investment of $1,000 invested on October 1, 2018 and held through March 31, 2019), is intended to assist shareholders both in calculating expenses based on an investment in the Fund and in comparing these expenses with similar costs of investing in other mutual funds.

The expense example provides information about actual account values and actual expenses. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number corresponding to their Fund and share class under the heading entitled “Expenses Paid During the Period.”

The expense example also 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. In order to assist shareholders in comparing the ongoing expenses of investing in the Fund and other funds, compare the 5% hypothetical example with the 5% hypothetical examples that appear in shareholder reports of other funds.

The expenses shown in the expense example are intended to highlight shareholders’ ongoing costs only and do not reflect transactional expenses, such as sales charges, if any. Therefore, the hypothetical example is useful in comparing ongoing expenses only, and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher.

Derivative Financial Instruments

The Fund may invest in various derivative financial instruments. These instruments are used to obtain exposure to a security, commodity, index, market, and/or other assets without owning or taking physical custody of securities, commodities and/or other referenced assets or to manage market, equity, credit, interest rate, foreign currency exchange rate, commodity and/or other risks. Derivative financial instruments may give rise to a form of economic leverage and involve risks, including the imperfect correlation between the value of a derivative financial instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the instrument. The Fund’s successful use of a derivative financial instrument depends on the investment adviser’s ability to predict pertinent market movements accurately, which cannot be assured. The use of these instruments may result in losses greater than if they had not been used, may limit the amount of appreciation the Fund can realize on an investment and/or may result in lower distributions paid to shareholders. The Fund’s investments in these instruments, if any, are discussed in detail in the Notes to Financial Statements.

6 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Par (000)				Value
Asset-Backed Securities — 0.0%
Knollwood CDO Ltd., Series2004-1A, Class C, (LIBOR USD 3 Month + 3.20%), 4.36%, 01/10/39(a)(b)(c)		USD		164	$	—
Total Asset-Backed Securities — 0.0% (Cost: $159,507)						—
			Shares
Common Stocks — 50.4%
Aerospace & Defense — 0.2%
Airbus SE				7,349		974,009
Safran SA				2,719		372,668
Singapore Technologies Engineering Ltd.				151,200		418,128
Thales SA				1,792		214,700
						1,979,505
Air Freight & Logistics — 0.1%
United Parcel Service, Inc., Class B				10,396		1,161,649
Airlines — 0.6%
American Airlines Group, Inc.				29,769		945,463
ANA Holdings, Inc.				5,300		194,445
Delta Air Lines, Inc.				18,409		950,825
Deutsche Lufthansa AG (Registered)				23,305		512,268
Southwest Airlines Co.				29,752		1,544,426
United Continental Holdings, Inc.(d)				16,264		1,297,542
						5,444,969
Auto Components — 0.1%
Aptiv plc				1,981		157,469
Lear Corp.				1,925		261,242
						418,711
Automobiles — 1.3%
Bayerische Motoren Werke AG				10,673		824,105
Daimler AG (Registered)				18,141		1,064,573
Ferrari NV				2,912		391,222
Fiat Chrysler Automobiles NV(d)				17,583		262,614
Ford Motor Co.				121,298		1,064,996
General Motors Co.				56,558		2,098,302
Harley-Davidson, Inc.				1,821		64,937
Honda Motor Co. Ltd.				10,900		296,053
Nissan Motor Co. Ltd.				12,800		105,116
Peugeot SA				4,544		110,881
Subaru Corp.				6,800		155,262
Tesla, Inc.(d)				7,157		2,002,958
Toyota Motor Corp.				26,900		1,584,701
Volkswagen AG				3,357		547,283
						10,573,003
Banks — 3.4%
ABN AMRO Group NV, CVA(c)				26,001		586,181
AIB Group plc				107,129		482,084
Australia & New Zealand Banking Group Ltd.				30,619		566,278
Banco Bilbao Vizcaya Argentaria SA				165,762		947,137
Banco Santander SA				347,749		1,614,783
Bank LeumiLe-Israel BM				16,866		110,498
Bank of America Corp.				66,392		1,831,755
Bank of Ireland Group plc				107,889		643,882
Bank of Montreal				2,968		222,075
Bank of Nova Scotia (The)				13,723		730,538
Bankia SA				8,232		21,344
Bankinter SA				39,626		302,019
Barclays plc				137,158		276,273
BNP Paribas SA				6,327		301,091
BOC Hong Kong Holdings Ltd.				52,500		217,871

Security	Shares		Value
Banks (continued)
CaixaBank SA		158,573	$	495,886
Canadian Imperial Bank of Commerce		973		76,888
Citigroup, Inc.		6,939		431,745
Commonwealth Bank of Australia		19,998		1,003,782
Credit Agricole SA		7,735		93,392
DBS Group Holdings Ltd.		20,000		373,338
DNB ASA		5,018		92,431
Erste Group Bank AG(d)		15,583		572,732
Hang Seng Bank Ltd.		13,700		338,293
HSBC Holdings plc		285,207		2,317,551
ING Groep NV		92,285		1,118,245
Japan Post Bank Co. Ltd.		42,600		465,456
JPMorgan Chase & Co.		25,349		2,566,079
KBC Group NV		5,782		404,225
Mediobanca Banca di Credito Finanziario SpA		919		9,569
Mitsubishi UFJ Financial Group, Inc.		194,600		962,452
Mizuho Financial Group, Inc.		566,400		876,488
National Australia Bank Ltd.		21,945		394,312
National Bank of Canada		1,172		52,893
Nordea Bank Abp		24,836		189,123
Oversea-Chinese Banking Corp. Ltd.		35,200		287,780
Raiffeisen Bank International AG		5,989		134,526
Resona Holdings, Inc.		13,100		56,750
Royal Bank of Canada		14,437		1,089,189
Royal Bank of Scotland Group plc		109,830		353,660
Skandinaviska Enskilda Banken AB, Class A		13,281		115,052
Societe Generale SA		4,610		133,199
Standard Chartered plc		55,108		424,791
Sumitomo Mitsui Financial Group, Inc.		30,800		1,078,576
Sumitomo Mitsui Trust Holdings, Inc.		8,500		305,482
Svenska Handelsbanken AB, Class A		3,535		37,322
Swedbank AB, Class A		7,025		99,284
Toronto-Dominion Bank (The)		16,985		921,729
UniCredit SpA		33,580		431,352
United Overseas Bank Ltd.		15,000		279,861
Wells Fargo & Co.		19,256		930,450
Westpac Banking Corp.		34,618		638,129
				29,005,821
Beverages — 0.9%
Anheuser-Busch InBev SA		11,416		958,307
Asahi Group Holdings Ltd.		10,200		455,313
Carlsberg A/S, Class B		1,823		227,963
Coca-Cola Amatil Ltd.		29,756		182,882
Coca-Cola Bottlers Japan Holdings, Inc.		5,200		132,270
Coca-Cola Co. (The)		12,701		595,169
Coca-Cola European Partners plc		8,242		426,441
Davide Campari-Milano SpA		17,794		174,819
Diageo plc		30,481		1,247,345
Heineken Holding NV		5,731		575,039
Heineken NV		4,186		442,435
Kirin Holdings Co. Ltd.		19,000		454,550
PepsiCo, Inc.		7,168		878,438
Pernod Ricard SA		4,702		844,294
Suntory Beverage & Food Ltd.		1,200		56,438
				7,651,703
Biotechnology — 0.6%
AbbVie, Inc.		13,957		1,124,795
Amgen, Inc.		6,168		1,171,797
BeiGene Ltd., ADR(d)		893		117,876
Biogen, Inc.(d)		1,436		339,442
Celgene Corp.(d)		5,176		488,304
CSL Ltd.		6,800		943,516
Genmab A/S(d)		657		114,001

SCHEDULE OF INVESTMENTS 7

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Biotechnology (continued)
Gilead Sciences, Inc.		10,108	$	657,121
Grifols SA		1,688		47,331
Vertex Pharmaceuticals, Inc.(d)		1,333		245,205
				5,249,388
Capital Markets — 0.6%
Brookfield Asset Management, Inc., Class A		12,554		584,886
Charles Schwab Corp. (The)		2,713		116,008
CME Group, Inc.		924		152,072
Credit Suisse Group AG (Registered)(d)		34,484		401,960
Deutsche Bank AG (Registered)		8,016		65,346
Deutsche Boerse AG		2,562		328,499
Goldman Sachs Group, Inc. (The)		2,025		388,780
Hargreaves Lansdown plc		458		11,127
Hong Kong Exchanges & Clearing Ltd.		12,200		426,250
Invesco Ltd.		4,599		88,807
Investec plc		12,795		73,732
Japan Exchange Group, Inc.		2,500		44,622
Macquarie Group Ltd.		1,391		128,106
Morgan Stanley		4,628		195,302
Nomura Holdings, Inc.		27,900		100,821
S&P Global, Inc.		6,890		1,450,689
SBI Holdings, Inc.		2,300		51,432
Singapore Exchange Ltd.		8,900		48,110
St James’s Place plc		880		11,793
UBS Group AG (Registered)(d)		52,845		641,197
				5,309,539
Chemicals — 0.5%
Air Water, Inc.		21,200		307,919
Asahi Kasei Corp.		15,400		159,486
BASF SE		2,442		180,090
CF Industries Holdings, Inc.		338		13,817
Covestro AG(c)		2,897		159,831
DowDuPont, Inc.		25,354		1,351,622
Evonik Industries AG		7,268		198,338
Kaneka Corp.		1,400		52,560
Kansai Paint Co. Ltd.		1,500		28,672
Linde plc		4,136		727,646
Mitsubishi Chemical Holdings Corp.		15,800		111,589
Mosaic Co. (The)		5,795		158,261
Nutrien Ltd.		3,603		190,025
Sherwin-Williams Co. (The)		412		177,453
Showa Denko KK		3,900		137,857
Symrise AG		1,094		98,622
Yara International ASA		10,196		417,781
				4,471,569
Commercial Services & Supplies — 1.1%
Babcock International Group plc		14,875		95,707
Cintas Corp.		8,645		1,747,241
Copart, Inc.(d)		14,878		901,458
Dai Nippon Printing Co. Ltd.		5,300		126,950
Edenred		19,343		880,891
ISS A/S		13,613		414,607
Republic Services, Inc.		11,299		908,214
Rollins, Inc.		11,646		484,706
Secom Co. Ltd.		8,800		754,679
Sohgo Security Services Co. Ltd.		3,400		148,302
Toppan Printing Co. Ltd.		6,100		92,313
Waste Connections, Inc.		7,086		627,749
Waste Management, Inc.		16,928		1,758,988
				8,941,805

Security	Shares		Value
Construction & Engineering — 1.5%
Eiffage SA		1,260	$	121,121
Fluor Corp.		222,952		8,204,633
Jacobs Engineering Group, Inc.		47,504		3,571,826
Shimizu Corp.		5,500		47,901
Taisei Corp.		2,900		134,916
Vinci SA		2,104		204,723
				12,285,120
Construction Materials — 0.1%
Fletcher Building Ltd.		7,774		26,217
Martin Marietta Materials, Inc.		1,792		360,515
Taiheiyo Cement Corp.		2,400		80,157
Vulcan Materials Co.		4,391		519,894
				986,783
Consumer Finance — 0.1%
American Express Co.		9,895		1,081,523
Synchrony Financial		2,462		78,538
				1,160,061
Containers & Packaging — 2.0%
Avery Dennison Corp.		6,376		720,488
Ball Corp.		51,837		2,999,289
CCL Industries, Inc., Class B		1,810		73,275
Crown Holdings, Inc.(d)		30,879		1,685,067
International Paper Co.		111,233		5,146,751
Packaging Corp. of America		32,054		3,185,526
Sealed Air Corp.		7,589		349,549
Toyo Seikan Group Holdings Ltd.		19,700		404,116
Westrock Co.		64,168		2,460,843
				17,024,904
Distributors — 0.0%
Jardine Cycle & Carriage Ltd.		1,300		31,226
Diversified Financial Services — 0.3%
Berkshire Hathaway, Inc., Class B(d)		5,738		1,152,707
EXOR NV		544		35,329
Groupe Bruxelles Lambert SA		5,135		499,226
ORIX Corp.		53,800		772,977
Standard Life Aberdeen plc		6,518		22,403
Wendel SA		250		31,505
				2,514,147
Electric Utilities — 0.6%
American Electric Power Co., Inc.		5,448		456,270
Chubu Electric Power Co., Inc.		19,200		300,156
Chugoku Electric Power Co., Inc. (The)		17,000		212,204
Duke Energy Corp.		6,446		580,140
Edison International		8,492		525,825
EDP - Energias de Portugal SA		4,847		19,070
Enel SpA		33,909		217,282
Exelon Corp.		13,710		687,282
FirstEnergy Corp.		7,403		308,039
Kansai Electric Power Co., Inc. (The)		22,800		336,234
Kyushu Electric Power Co., Inc.		22,500		265,765
Longview Energy Co. (Acquired 08/13/04, cost $48,000)(b)(d)(e)		3,200		6,112
Red Electrica Corp. SA		4,840		103,173
Southern Co. (The)		2,069		106,926
SSE plc		17,356		268,529
Tohoku Electric Power Co., Inc.		20,700		264,308
Tokyo Electric Power Co. Holdings, Inc.(d)		28,100		177,764
				4,835,079
Electronic Equipment, Instruments & Components — 0.0%
Ingenico Group SA		2,353		168,079
Keyence Corp.		300		187,559
				355,638

8 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Energy Equipment & Services — 0.1%
Halliburton Co.		16,021	$	469,415
Schlumberger Ltd.		1,842		80,256
TechnipFMC plc		1,300		30,576
Tenaris SA		6,719		94,651
WorleyParsons Ltd.		9,719		97,546
				772,444
Entertainment — 0.8%
Activision Blizzard, Inc.		3,880		176,656
Electronic Arts, Inc.(d)		1,203		122,261
Konami Holdings Corp.		2,900		126,178
Liberty Media Corp.-Liberty Formula One, Class C(d)		3,574		125,269
Live Nation Entertainment, Inc.(d)		1,308		83,110
Netflix, Inc.(d)		8,289		2,955,526
Nexon Co. Ltd.(d)		700		11,009
Nintendo Co. Ltd.		1,500		430,037
Nordic Entertainment Group AB, Class B(d)		52		1,219
Viacom, Inc., Class B		7,201		202,132
Walt Disney Co. (The)		22,840		2,535,963
				6,769,360
Equity Real Estate Investment Trusts (REITs) — 0.8%
American Tower Corp.		4,186		824,893
Ascendas Real Estate Investment Trust		156,000		335,304
British Land Co. plc (The)		11,370		87,295
Brookfield Property REIT, Inc., Class A		542		11,106
CapitaLand Commercial Trust		183,300		262,622
CapitaLand Mall Trust		194,300		341,431
Crown Castle International Corp.		1,561		199,808
Daiwa House REIT Investment Corp.		25		55,460
Dexus		11,386		103,049
Equity Residential		4,123		310,544
GPT Group (The)		20,203		89,116
H&R REIT		14,801		259,282
Hammerson plc		3,906		17,100
Japan Prime Realty Investment Corp.		33		135,844
Japan Real Estate Investment Corp.		43		253,471
Japan Retail Fund Investment Corp.		111		223,042
Land Securities Group plc		15,793		188,031
Link REIT		30,000		351,230
Mirvac Group		41,598		81,258
Nippon Building Fund, Inc.		62		419,818
Nippon Prologis REIT, Inc.		16		34,065
Nomura Real Estate Master Fund, Inc.		189		278,419
Public Storage		700		152,446
SBA Communications Corp.(d)		620		123,789
Scentre Group		59,516		173,733
Segro plc		19,797		173,779
Simon Property Group, Inc.		3,079		561,025
Stockland		27,250		74,536
Suntec REIT		97,700		140,774
United Urban Investment Corp.		72		113,667
				6,375,937
Food & Staples Retailing — 1.5%
Aeon Co. Ltd.		7,900		165,468
Alimentation Couche-Tard, Inc., Class B		798		47,008
Carrefour SA		9,102		169,999
Casino Guichard Perrachon SA		2,911		126,208
Colruyt SA		10,579		781,699
Costco Wholesale Corp.		7,181		1,738,807
Empire Co. Ltd., Class A		7,581		164,118
FamilyMart UNY Holdings Co. Ltd.		800		20,393
George Weston Ltd.		8,613		619,316
ICA Gruppen AB		14,159		568,450

Security	Shares		Value
Food & Staples Retailing (continued)
J Sainsbury plc		59,991	$	184,092
Koninklijke Ahold Delhaize NV		26,908		716,392
Kroger Co. (The)		23,965		589,539
Loblaw Cos. Ltd.		13,570		669,386
METRO AG		14,946		248,232
Metro, Inc.		13,676		503,505
Seven & i Holdings Co. Ltd.		10,600		399,940
Sysco Corp.		4,435		296,081
Tesco plc		80,214		242,768
Walgreens Boots Alliance, Inc.		14,373		909,380
Walmart, Inc.		29,757		2,902,200
Wm Morrison Supermarkets plc		111,295		330,165
Woolworths Group Ltd.		7,309		157,844
				12,550,990
Food Products — 0.7%
a2 Milk Co. Ltd.(d)		1,156		11,311
Bunge Ltd.		5,012		265,987
Conagra Brands, Inc.		3,113		86,355
Danone SA		13,709		1,055,606
General Mills, Inc.		9,681		500,992
Kerry Group plc, Class A		3,259		363,750
Kraft Heinz Co. (The)		8,200		267,730
Lamb Weston Holdings, Inc.		2,840		212,829
MEIJI Holdings Co. Ltd.		3,500		284,520
Nestle SA (Registered)		24,031		2,291,366
Nisshin Seifun Group, Inc.		2,800		64,367
Nissin Foods Holdings Co. Ltd.		500		34,403
Toyo Suisan Kaisha Ltd.		300		11,436
Tyson Foods, Inc., Class A		3,272		227,175
WH Group Ltd.(c)		404,000		432,129
Yamazaki Baking Co. Ltd.		6,500		105,666
				6,215,622
Gas Utilities — 0.1%
Osaka Gas Co. Ltd.		6,300		124,558
Toho Gas Co. Ltd.		900		40,475
Tokyo Gas Co. Ltd.		11,700		316,716
				481,749
Health Care Equipment & Supplies — 1.1%
Abbott Laboratories		25,885		2,069,247
ABIOMED, Inc.(d)		357		101,956
Align Technology, Inc.(d)		1,050		298,546
Baxter International, Inc.		6,099		495,910
Becton Dickinson and Co.		1,473		367,852
BioMerieux		239		19,768
Boston Scientific Corp.(d)		8,016		307,654
Cochlear Ltd.		625		77,064
Coloplast A/S, Class B		314		34,468
Danaher Corp.		2,484		327,938
DexCom, Inc.(d)		1,392		165,787
Edwards Lifesciences Corp.(d)		1,966		376,155
Fisher & Paykel Healthcare Corp. Ltd.		18,920		202,542
Hoya Corp.		7,500		496,779
IDEXX Laboratories, Inc.(d)		324		72,446
Intuitive Surgical, Inc.(d)		836		477,005
Koninklijke Philips NV		15,672		640,320
Medtronic plc		13,874		1,263,644
Olympus Corp.		15,600		169,716
Siemens Healthineers AG(c)		8,217		343,062
Smith & Nephew plc		731		14,517
Sonova Holding AG (Registered)		1,321		261,782
Straumann Holding AG (Registered)		127		103,822
Stryker Corp.		2,590		511,577
Terumo Corp.		7,200		220,361
				9,419,918

SCHEDULE OF INVESTMENTS 9

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Health Care Providers & Services — 1.6%
Alfresa Holdings Corp.		9,000	$	256,471
AmerisourceBergen Corp.		6,723		534,613
Anthem, Inc.		1,815		520,869
Cardinal Health, Inc.		8,912		429,113
Centene Corp.(d)		4,595		243,994
Cigna Corp.		5,211		838,033
CVS Health Corp.		31,461		1,696,692
DaVita, Inc.(d)		8,457		459,131
Fresenius Medical Care AG & Co. KGaA		1,498		121,068
Fresenius SE & Co. KGaA		4,621		258,277
HCA Healthcare, Inc.		12,270		1,599,763
Henry Schein, Inc.(d)		4,921		295,801
Humana, Inc.		717		190,722
Laboratory Corp. of America Holdings(d)		4,009		613,297
McKesson Corp.		6,004		702,828
Medipal Holdings Corp.		12,300		292,664
NMC Health plc		4,545		135,472
Quest Diagnostics, Inc.		6,037		542,847
Ramsay Health Care Ltd.		3,929		179,668
Ryman Healthcare Ltd.		38,129		318,363
Sonic Healthcare Ltd.		8,757		152,831
Suzuken Co. Ltd.		6,200		359,629
UnitedHealth Group, Inc.		8,911		2,203,334
Universal Health Services, Inc., Class B		3,976		531,869
				13,477,349
Health Care Technology — 0.1%
Cerner Corp.(d)		4,081		233,474
M3, Inc.		1,700		28,610
Veeva Systems, Inc., Class A(d)		1,908		242,049
				504,133
Hotels, Restaurants & Leisure — 0.2%
Galaxy Entertainment Group Ltd.		25,000		170,375
McDonald’s Corp.		300		56,970
Oriental Land Co. Ltd.		2,000		227,472
Restaurant Brands International, Inc.		1,615		105,068
Sands China Ltd.		28,800		144,949
SJM Holdings Ltd.		126,000		144,039
Whitbread plc		5,469		361,918
Wynn Macau Ltd.		9,600		22,672
				1,233,463
Household Durables — 0.3%
DR Horton, Inc.		16,779		694,315
Lennar Corp., Class A		12,100		593,989
NVR, Inc.(d)		266		736,022
PulteGroup, Inc.		20,413		570,747
Sony Corp.		800		33,777
				2,628,850
Household Products — 0.5%
Church & Dwight Co., Inc.		1,357		96,659
Essity AB, Class B		26,837		774,471
Henkel AG & Co. KGaA		6,029		573,677
Kimberly-Clark Corp.		4,850		600,915
Lion Corp.		2,200		46,363
Procter & Gamble Co. (The)		17,866		1,858,957
Reckitt Benckiser Group plc		7,559		629,080
				4,580,122
Independent Power and Renewable Electricity Producers — 0.0%
Electric Power Development Co. Ltd.		5,100		124,365
Industrial Conglomerates — 0.3%
3M Co.		3,842		798,291

Security	Shares		Value
Industrial Conglomerates (continued)
General Electric Co.		133,877	$	1,337,431
Keppel Corp. Ltd.		48,300		222,245
NWS Holdings Ltd.		57,000		124,794
Siemens AG (Registered)		2,635		283,374
Toshiba Corp.		1,900		60,560
				2,826,695
Insurance — 3.2%
Admiral Group plc		6,008		169,943
Aegon NV		134,941		648,184
Aflac, Inc.		11,738		586,900
Ageas		24,737		1,193,228
AIA Group Ltd.		176,000		1,759,960
Allianz SE (Registered)		9,565		2,131,537
Allstate Corp. (The)		3,039		286,213
American International Group, Inc.		15,773		679,185
Aon plc		4,067		694,237
Arch Capital Group Ltd.(d)		6,448		208,399
Assicurazioni Generali SpA		54,651		1,013,259
Athene Holding Ltd., Class A(d)		694		28,315
Aviva plc		41,140		221,228
AXA SA		29,883		751,584
Baloise Holding AG (Registered)		957		158,169
CNP Assurances		5,844		128,673
Dai-ichi Life Holdings, Inc.		27,900		388,405
Direct Line Insurance Group plc		58,761		270,314
Hannover Rueck SE		5,241		753,083
Japan Post Holdings Co. Ltd.		84,000		983,124
Legal & General Group plc		206,244		740,133
Manulife Financial Corp.		47,012		795,055
Mapfre SA		75,727		208,736
Marsh & McLennan Cos., Inc.		22,996		2,159,324
MetLife, Inc.		15,840		674,309
MS&AD Insurance Group Holdings, Inc.		22,000		670,309
Muenchener Rueckversicherungs-Gesellschaft AG (Registered)		3,206		759,804
NN Group NV		20,249		842,489
Poste Italiane SpA(c)		17,998		175,319
Progressive Corp. (The)		7,652		551,633
Prudential Financial, Inc.		550		50,534
Prudential plc		30,023		601,825
QBE Insurance Group Ltd.		32,795		286,921
Reinsurance Group of America, Inc.		713		101,232
Sampo OYJ, Class A		4,135		187,410
Sompo Holdings, Inc.		11,100		411,066
Sony Financial Holdings, Inc.		8,000		150,975
Sun Life Financial, Inc.		20,669		794,063
Swiss Life Holding AG (Registered)(d)		953		419,892
Swiss Re AG		8,118		793,496
T&D Holdings, Inc.		11,200		117,945
Tokio Marine Holdings, Inc.		20,000		968,934
Travelers Cos., Inc. (The)		1,207		165,552
Unum Group		2,448		82,816
Willis Towers Watson plc		956		167,921
Zurich Insurance Group AG		3,473		1,149,690
				27,081,323
Interactive Media & Services — 1.5%
Alphabet, Inc., Class A(d)		3,053		3,593,045
Alphabet, Inc., Class C(d)		3,755		4,405,779
Auto Trader Group plc(c)		3,740		25,437
Facebook, Inc., Class A(d)		25,919		4,320,438
IAC/InterActiveCorp(d)		280		58,831
Kakaku.com, Inc.		1,300		25,045

10 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Interactive Media & Services (continued)
TripAdvisor, Inc.(d)		1,707	$	87,825
Twitter, Inc.(d)		4,679		153,846
Yahoo Japan Corp.		26,200		64,259
				12,734,505
Internet & Direct Marketing Retail — 1.5%
Amazon.com, Inc.(d)		5,539		9,863,574
Booking Holdings, Inc.(d)		987		1,722,226
eBay, Inc.		7,844		291,326
Expedia Group, Inc.		242		28,798
GrubHub, Inc.(d)		1,816		126,158
MercadoLibre, Inc.		431		218,832
Qurate Retail, Inc.(d)		2,551		40,765
Rakuten, Inc.		8,000		75,919
Wayfair, Inc., Class A(d)		2,107		312,784
Zalando SE(c)(d)		1,069		41,670
ZOZO, Inc.		1,300		24,578
				12,746,630
IT Services — 1.5%
Accenture plc, Class A		473		83,258
Atos SE		5,868		566,486
Automatic Data Processing, Inc.		13,360		2,134,126
Broadridge Financial Solutions, Inc.		88		9,125
Cognizant Technology Solutions Corp., Class A		376		27,241
Computershare Ltd.		7,496		91,123
Fidelity National Information Services, Inc.		5,134		580,655
Fiserv, Inc.(d)		6,250		551,750
FleetCor Technologies, Inc.(d)		707		174,339
Fujitsu Ltd.		7,400		535,165
International Business Machines Corp.		6,437		908,261
Jack Henry & Associates, Inc.		782		108,495
Leidos Holdings, Inc.		612		39,223
Mastercard, Inc., Class A		5,146		1,211,626
Nomura Research Institute Ltd.		8,700		396,281
Obic Co. Ltd.		3,700		374,161
Otsuka Corp.		8,600		321,746
Paychex, Inc.		4,829		387,286
PayPal Holdings, Inc.(d)		13,346		1,385,849
Shopify, Inc., Class A(d)		953		196,726
Square, Inc., Class A(d)		3,211		240,568
Visa, Inc., Class A		12,285		1,918,794
Wirecard AG		1,490		187,178
Worldpay, Inc., Class A(d)		3,469		393,732
				12,823,194
Life Sciences Tools & Services — 0.2%
Agilent Technologies, Inc.		677		54,417
Illumina, Inc.(d)		345		107,188
Mettler-Toledo International, Inc.(d)		25		18,075
QIAGEN NV(d)		8,146		330,664
Thermo Fisher Scientific, Inc.		2,775		759,573
Waters Corp.(d)		58		14,599
				1,284,516
Machinery — 0.0%
ANDRITZ AG		5,183		222,297
Media — 0.8%
CBS Corp.(Non-Voting), Class B		6,500		308,945
Charter Communications, Inc., Class A(d)		3,929		1,363,009
Comcast Corp., Class A		74,288		2,970,034
Dentsu, Inc.		1,800		76,180
Discovery, Inc., Class A(d)		1,558		42,097
Discovery, Inc., Class C(d)		11,512		292,635
Fox Corp., Class A(d)		5,884		216,002

Security	Shares			Value
Media (continued)
Fox Corp., Class B(d)		5,279		$	189,410
Hakuhodo DY Holdings, Inc.		600			9,661
I-CABLE Communications Ltd.(d)		12,579			167
Interpublic Group of Cos., Inc. (The)		3,604			75,720
Liberty Broadband Corp., Class C(d)		840			77,062
Liberty Global plc, Class A(d)		2,286	��		56,967
Liberty Global plc, Class C(d)		21,104			510,928
Liberty Media Corp.-Liberty SiriusXM, Class C(d)		4,346			166,191
Modern Times Group MTG AB, Class B		52			667
News Corp., Class A		2,782			34,608
Omnicom Group, Inc.		2,925			213,496
Sirius XM Holdings, Inc.		70,323			398,732
					7,002,511
Metals & Mining — 0.5%
Agnico Eagle Mines Ltd.		19,822			861,794
Alumina Ltd.		273,850			471,600
Franco-Nevada Corp.		4,076			305,589
Freeport-McMoRan, Inc.		9,217			118,807
Fresnillo plc		67,751			767,815
Goldcorp, Inc.		21,257			243,214
Turquoise Hill Resources Ltd.(d)		53,571			88,193
Wheaton Precious Metals Corp.		47,043			1,119,795
					3,976,807
Multiline Retail — 0.3%
Canadian Tire Corp. Ltd., Class A		4,175			449,851
Dollar General Corp.		655			78,142
Dollar Tree, Inc.(d)		210			22,058
Dollarama, Inc.		12,974			346,109
Kohl’s Corp.		499			34,316
Marks & Spencer Group plc		60,758			220,508
Marui Group Co. Ltd.		1,300			26,285
Next plc		3,605			261,961
Nordstrom, Inc.		4,987			221,323
Pan Pacific International Holdings Corp.		1,500			99,381
Takashimaya Co. Ltd.		2,900			38,645
Target Corp.		4,008			321,682
Wesfarmers Ltd.		10,672			262,797
					2,383,058
Multi-Utilities — 0.5%
AGL Energy Ltd.		224,363			3,468,156
E.ON SE		10,755			119,684
Innogy SE(c)		310			14,334
National Grid plc		14,977			166,250
RWE AG		1,099			29,510
					3,797,934
Oil, Gas & Consumable Fuels — 3.0%
Anadarko Petroleum Corp.		9,579			435,653
Apache Corp.		4,799			166,333
BP plc		251,934			1,829,413
Cabot Oil & Gas Corp.		11,533			301,011
Canadian Natural Resources Ltd.		30,236			830,141
Chevron Corp.		18,827			2,319,110
Cimarex Energy Co.		1,191			83,251
Concho Resources, Inc.		201			22,303
ConocoPhillips		19,593			1,307,637
Continental Resources, Inc.(d)		1,579			70,692
Devon Energy Corp.		8,125			256,425
Enbridge, Inc.		24,144			874,449
Encana Corp.		10,308			74,667
Eni SpA		9,535			168,469
EOG Resources, Inc.		8,154			776,098

SCHEDULE OF INVESTMENTS 11

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Oil, Gas & Consumable Fuels (continued)
Equinor ASA		16,133	$	353,637
Exxon Mobil Corp.		35,694		2,884,075
Galp Energia SGPS SA		32,154		515,226
Hess Corp.		3,248		195,627
Idemitsu Kosan Co. Ltd.		9,586		320,634
Inpex Corp.		82,000		780,059
JXTG Holdings, Inc.		83,800		382,542
Koninklijke Vopak NV		1,143		54,746
Lundin Petroleum AB		12,307		416,740
Marathon Oil Corp.		13,493		225,468
Matador Resources Co.(d)		939		18,151
Noble Energy, Inc.		418		10,337
Occidental Petroleum Corp.		2,521		166,890
Oil Search Ltd.		94,713		526,959
OMV AG		3,601		195,539
Pembina Pipeline Corp.		5,689		208,982
Pioneer Natural Resources Co.		2,504		381,309
PrairieSky Royalty Ltd.		2,072		27,909
Royal Dutch Shell plc, Class A		74,440		2,339,346
Royal Dutch Shell plc, Class B		63,679		2,012,612
Santos Ltd.		68,608		332,184
Seven Generations Energy Ltd., Class A(d)		1,263		9,120
Suncor Energy, Inc.		8,179		265,075
TOTAL SA		31,831		1,771,374
Tourmaline Oil Corp.		3,482		53,780
TransCanada Corp.		12,706		570,669
Vermilion Energy, Inc.		3,548		87,588
Woodside Petroleum Ltd.		35,482		871,085
				25,493,315
Paper & Forest Products — 0.0%
Oji Holdings Corp.		5,100		31,737
Personal Products — 0.8%
Beiersdorf AG		9,048		941,949
Estee Lauder Cos., Inc. (The), Class A		3,239		536,217
Kao Corp.		8,900		702,447
Kobayashi Pharmaceutical Co. Ltd.		1,900		160,755
Kose Corp.		1,100		202,742
L’Oreal SA		5,745		1,547,079
Pola Orbis Holdings, Inc.		8,400		268,685
Shiseido Co. Ltd.		6,600		477,872
Unilever NV, CVA		26,750		1,559,563
Unilever plc		11,486		661,164
				7,058,473
Pharmaceuticals — 4.7%
Allergan plc		8,213		1,202,465
Astellas Pharma, Inc.		41,400		622,067
AstraZeneca plc		12,131		968,314
Aurora Cannabis, Inc.(d)		3,061		27,693
Bausch Health Cos., Inc.(d)		7,316		180,498
Bayer AG (Registered)		11,953		769,676
Bristol-Myers Squibb Co.		38,775		1,849,955
Chugai Pharmaceutical Co. Ltd.		5,300		365,059
Daiichi Sankyo Co. Ltd.		9,000		415,599
Eisai Co. Ltd.		4,200		236,321
Elanco Animal Health, Inc.(d)		3,066		98,327
Eli Lilly & Co.		20,906		2,712,763
GlaxoSmithKline plc		47,401		984,794
H Lundbeck A/S		3,055		132,480
Hisamitsu Pharmaceutical Co., Inc.		700		32,289
Ipsen SA		1,027		140,834
Jazz Pharmaceuticals plc(d)		1,557		222,573

Security	Shares			Value
Pharmaceuticals (continued)
Johnson & Johnson			41,474	$	5,797,650
Kyowa Hakko Kirin Co. Ltd.			5,700		124,394
Merck & Co., Inc.			50,649		4,212,477
Merck KGaA			5,993		684,227
Mitsubishi Tanabe Pharma Corp.			4,700		62,954
Mylan NV(d)		��	13,993		396,562
Nektar Therapeutics(d)			8,433		283,349
Novartis AG (Registered)			24,288		2,334,551
Novo Nordisk A/S, Class B			28,977		1,514,494
Ono Pharmaceutical Co. Ltd.			5,700		112,007
Orion OYJ, Class B			2,913		109,460
Otsuka Holdings Co. Ltd.			6,800		267,736
Perrigo Co. plc			3,495		168,319
Pfizer, Inc.			105,231		4,469,161
Recordati SpA			4,411		171,878
Roche Holding AG			8,461		2,331,470
Sanofi SA			24,742		2,187,790
Santen Pharmaceutical Co. Ltd.			2,000		29,893
Shionogi & Co. Ltd.			8,300		515,277
Sumitomo Dainippon Pharma Co. Ltd.			3,000		74,457
Taisho Pharmaceutical Holdings Co. Ltd.			2,000		191,066
Takeda Pharmaceutical Co. Ltd.			17,527		717,770
Teva Pharmaceutical Industries Ltd., ADR			2,119		33,226
UCB SA			4,123		354,175
Zoetis, Inc.			11,881		1,196,060
					39,302,110
Professional Services — 0.9%
Bureau Veritas SA			9,581		224,778
CoStar Group, Inc.(d)			1,403		654,387
Equifax, Inc.			7,987		946,459
Nielsen Holdings plc			32,398		766,861
Persol Holdings Co. Ltd.			5,000		81,192
Recruit Holdings Co. Ltd.			12,700		364,115
Robert Half International, Inc.			13,004		847,341
SEEK Ltd.			15,034		187,551
Teleperformance			5,171		929,574
TransUnion			18,934		1,265,549
Verisk Analytics, Inc.			11,972		1,592,276
					7,860,083
Real Estate Management & Development — 0.7%
Aeon Mall Co. Ltd.			5,800		95,459
CapitaLand Ltd.			154,000		415,515
City Developments Ltd.			1,300		8,700
CK Asset Holdings Ltd.			29,000		258,268
Daito Trust Construction Co. Ltd.			2,300		320,891
Daiwa House Industry Co. Ltd.			17,400		554,149
Deutsche Wohnen SE			11,553		560,612
Henderson Land Development Co. Ltd.			11,000		70,008
Hongkong Land Holdings Ltd.			24,300		172,959
Hulic Co. Ltd.			16,300		160,162
Mitsubishi Estate Co. Ltd.			35,300		640,516
Mitsui Fudosan Co. Ltd.			21,400		539,099
New World Development Co. Ltd.			61,000		101,243
Nomura Real Estate Holdings, Inc.			6,000		115,457
Sumitomo Realty & Development Co. Ltd.			14,900		618,206
Sun Hung Kai Properties Ltd.			22,000		378,196
Swire Pacific Ltd., Class A			8,000		103,047
Swire Properties Ltd.			8,000		34,431
Tokyu Fudosan Holdings Corp.			5,000		29,963
UOL Group Ltd.			3,500		17,994
Vonovia SE			12,705		659,333
Wharf Real Estate Investment Co. Ltd.			10,000		74,527

12 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security	Shares		Value
Real Estate Management & Development (continued)
Wheelock & Co. Ltd.		5,000	$	36,696
				5,965,431
Road & Rail — 0.0%
Canadian National Railway Co.		694		62,127
Central Japan Railway Co.		400		92,978
				155,105
Semiconductors & Semiconductor Equipment — 0.0%
Applied Materials, Inc.		3,984		158,005
Software — 2.2%
Adobe, Inc.(d)		5,939		1,582,684
Autodesk, Inc.(d)		357		55,628
CDK Global, Inc.		1,676		98,582
Check Point Software Technologies Ltd.(d)		1,688		213,515
Intuit, Inc.		4,958		1,296,071
Microsoft Corp.		78,500		9,258,290
Oracle Corp.		6,300		423,667
Oracle Corp.		29,045		1,560,007
Red Hat, Inc.(d)		2,602		475,385
salesforce.com, Inc.(d)		7,396		1,171,305
SAP SE		13,203		1,526,327
ServiceNow, Inc.(d)		1,618		398,821
Splunk, Inc.(d)		1,258		156,747
Symantec Corp.		2,334		53,659
Temenos AG (Registered)(d)		337		49,719
Trend Micro, Inc.		2,400		117,050
VMware, Inc., Class A		385		69,496
Workday, Inc., Class A(d)		1,404		270,761
				18,777,714
Specialty Retail — 4.4%
Advance Auto Parts, Inc.		8,225		1,402,609
AutoZone, Inc.(d)		2,208		2,261,257
Best Buy Co., Inc.		25,097		1,783,393
Burlington Stores, Inc.(d)		5,076		795,308
CarMax, Inc.(d)		17,262		1,204,888
Fast Retailing Co. Ltd.		500		235,481
Gap, Inc. (The)		19,673		515,039
Hennes & Mauritz AB, Class B		7,794		130,029
Hikari Tsushin, Inc.		200		37,961
Home Depot, Inc. (The)		43,303		8,309,413
Industria de Diseno Textil SA		4,649		136,687
L Brands, Inc.		29,587		816,009
Lowe’s Cos., Inc.		43,745		4,788,765
Nitori Holdings Co. Ltd.		700		90,507
O’Reilly Automotive, Inc.(d)		6,533		2,536,764
Ross Stores, Inc.		16,317		1,519,113
Tiffany & Co.		21,054		2,222,250
TJX Cos., Inc. (The)		42,989		2,287,445
Tractor Supply Co.		25,853		2,527,389
Ulta Beauty, Inc.(d)		9,910		3,455,914
				37,056,221
Technology Hardware, Storage & Peripherals — 0.9%
Apple, Inc.		38,641		7,339,858
Textiles, Apparel & Luxury Goods — 0.1%
Hermes International		563		371,734
Kering SA		304		174,375
LVMH Moet Hennessy Louis Vuitton SE		714		262,990
				809,099

Security	Shares				Value
Tobacco — 0.4%
Altria Group, Inc.				9,347	$	536,798
British American Tobacco plc				27,741		1,157,295
Imperial Brands plc				1,390		47,548
Japan Tobacco, Inc.				19,900		492,880
Philip Morris International, Inc.				3,337		294,957
Swedish Match AB				11,329		578,038
						3,107,516
Trading Companies & Distributors — 0.0%
Finning International, Inc.				9,776		173,815
Transportation Infrastructure — 0.2%
Aena SME SA(c)				4,880		879,331
Aeroports de Paris				1,809		350,002
Transurban Group(f)				9,730		91,259
						1,320,592
Water Utilities — 0.0%
Severn Trent plc				5,094		131,191
United Utilities Group plc				17,370		184,481
						315,672
Wireless Telecommunication Services — 0.0%
SoftBank Group Corp.				2,300		224,196
Total Common Stocks — 50.4% (Cost: $406,272,909)						426,563,334
			Beneficial Interest (000)
Other Interests — 0.0%(b)(d)(g)(h)
Capital Markets — 0.0%
Lehman Brothers Holdings, Inc.		USD		300		—
						—
Total Other Interests — 0.0%						—
			Shares
Preferred Stocks — 0.4%
Automobiles — 0.2%
Bayerische Motoren Werke AG (Preference)				5,561		366,096
Porsche Automobil Holding SE (Preference)				10,163		637,753
Volkswagen AG (Preference)				3,800		599,089
						1,602,938
Chemicals — 0.1%
Fuchs Petrolub SE (Preference)				18,816		776,720
Health Care Equipment & Supplies — 0.0%
Sartorius AG (Preference)				1,264		217,228
Household Products — 0.1%
Henkel AG & Co. KGaA (Preference)				4,912		501,880
Total Preferred Stocks — 0.4% (Cost: $3,205,810)						3,098,766

SCHEDULE OF INVESTMENTS 13

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund (Percentages shown are based on Net Assets)

Security		Par (000)		Value
U.S. Treasury Obligations — 18.7%
U.S. Treasury Bonds, 8.75%, 08/15/20	USD		28,819	$	31,284,810
U.S. Treasury Notes:
3.63%, 02/15/20			28,099		28,380,192
2.75%, 08/15/21			47,522		48,048,793
1.13%, 08/31/21			52,313		50,919,057
Total U.S. Treasury Obligations — 18.7% (Cost: $158,462,467)					158,632,852
Total Long-Term Investments — 69.5% (Cost: $568,100,693)					588,294,952
		Shares
Short-Term Securities — 4.0%(i)(j)
BlackRock Liquidity Funds,T-Fund, Institutional Class,
2.37%			33,595,055		33,595,055
Total Short-Term Securities — 4.0% (Cost: $33,595,055)					33,595,055
Total Investments — 73.5% (Cost: $601,695,748)					621,890,007
Other Assets Less Liabilities — 26.5%					223,974,546
Net Assets — 100.0%				$	845,864,553

^(a)  Variable rate security. Security may be issued at a fixed coupon rate, which converts to a variable rate at a specified date. Rate shown is the rate in effect as of period end.

^(b)  Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.

^(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)  Non-income producing security.

^(e)  Restricted security as to resale, excluding 144A securities. The Fund held restricted securities with a current value of $6,112, representing less than 0.05% of its net assets as of period end, and an original cost of $48,000.

^(f) A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately.

^(g)  Other interests represent beneficial interests in liquidation trusts and other reorganization or private entities.

^(h)  Issuer filed for bankruptcy and/or is in default.

⁽ⁱ⁾  Annualized7-day yield as of period end.

^(j)  During the six months ended March 31, 2019, investments in issuers considered to be affiliates of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

Affiliate	Shares Held at 09/30/18		Net Activity		Shares Held at 03/31/19		Value at 03/31/19		Income			Net Realized Gain (Loss) (a)			Change in Unrealized Appreciation (Depreciation)
BlackRock Liquidity Funds,T-Fund, Institutional Class		20,008,118		13,586,937		33,595,055	$	33,595,055	$	403,060		$	—		$	—
SL Liquidity Series, LLC, Money Market Series*		—		—		—		—		29,210	(b)		(394	)		—
							$	33,595,055	$	432,270		$	(394	)	$	—

* No longer held by the Fund as of period end.

^(a)  Includes net capital gain distributions, if applicable.

^(b)  Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

For Fund compliance purposes, the Fund’s industry classifications refer to one or more of the industrysub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industrysub-classifications for reporting ease.

14 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

Description	Number of Contracts		Expiration Date		Notional Amount (000)		Value/ Unrealized Appreciation (Depreciation)
Long Contracts
Amsterdam Exchange Index		904		04/18/19	$	111,129	$	3,408,515
CAC 40 10 Euro Index		259		04/18/19		15,523		295,466
IBEX 35 Index		92		04/18/19		9,483		(197,923	)
Hang Seng Index		58		04/29/19		10,742		150,188
Euro-BTP		126		06/06/19		18,299		404,453
TOPIX Index		223		06/13/19		32,032		(254,105	)
Australia 10 Year Bond		407		06/17/19		40,042		521,042
Canada 10 Year Bond		219		06/19/19		22,786		175,160
U.S. Treasury 10 Year Note		669		06/19/19		83,102		258,615
U.S. Treasury Ultra Bond		342		06/19/19		57,456		2,154,317
DAX Index		259		06/21/19		83,779		62,692
S&P 500E-Mini Index		358		06/21/19		50,797		1,535,195
Long Gilt		190		06/26/19		32,015		664,483
								9,178,098
Short Contracts
OMXS30 Index		3,751		04/17/19		62,384		(149,369	)
MSCI Singapore Index		1,784		04/29/19		47,350		(533,057	)
Euro-Bund		1,338		06/06/19		249,660		(4,780,156	)
S&P/TSX 60 Index		124		06/20/19		17,762		(51,611	)
SPI 200 Index		869		06/20/19		95,193		158,630
FTSE 100 Index		231		06/21/19		21,697		(227,067	)
FTSE/MIB Index		302		06/21/19		35,132		(1,033,452	)
MSCI EAFEE-Mini Index		1,664		06/21/19		155,284		(3,219,270	)
S&P 500E-Mini Index		2,314		06/21/19		328,333		(9,759,318	)
								(19,594,670	)
							$	(10,416,572	)

Forward Foreign Currency Exchange Contracts

Currency Purchased		Currency Sold		Counterparty	Settlement Date		Unrealized Appreciation (Depreciation)
AUD	63,001,681	USD	44,382,352	Morgan Stanley & Co. International plc		06/19/19	$	417,574
CHF	1,356,000	USD	1,355,864	Morgan Stanley & Co. International plc		06/19/19		16,161
CNY	197,625,000	USD	29,349,085	Bank of America NA		06/19/19		39,979
CNY	376,961,000	USD	56,049,513	Credit Suisse International		06/19/19		8,836
JPY	220,386,000	USD	1,994,624	Citibank NA		06/19/19		6,199
MXN	481,688,000	USD	24,263,098	Morgan Stanley & Co. International plc		06/19/19		240,692
MYR	87,103,000	USD	21,288,769	UBS AG		06/19/19		10,517
NZD	372,000	USD	252,382	Morgan Stanley & Co. International plc		06/19/19		1,336
PLN	6,530,000	USD	1,703,620	Morgan Stanley & Co. International plc		06/19/19		1,409
SEK	66,647,000	USD	7,095,981	Morgan Stanley & Co. International plc		06/19/19		115,166
USD	4,452,726	AUD	6,245,000	Morgan Stanley & Co. International plc		06/19/19		11,963
USD	565,482	BRL	2,209,000	JPMorgan Chase Bank NA		06/19/19		4,550
USD	13,597,292	CAD	18,093,000	Morgan Stanley & Co. International plc		06/19/19		31,454
USD	5,204,909	CNY	34,990,000	Bank of America NA		06/19/19		1,502
USD	1,356,642	CZK	30,946,000	Morgan Stanley & Co. International plc		06/19/19		8,856
USD	3,004,340	EUR	2,622,000	Citibank NA		06/19/19		43,376
USD	37,935,769	EUR	33,585,000	Morgan Stanley & Co. International plc		06/19/19		9,002
USD	80,686,938	GBP	61,320,000	Morgan Stanley & Co. International plc		06/19/19		505,153
USD	16,230,416	KRW	18,322,517,000	BNP Paribas SA		06/19/19		89,653
USD	7,296,796	KRW	8,272,742,000	JPMorgan Chase Bank NA		06/19/19		9,130
USD	18,686,975	PLN	70,547,000	Morgan Stanley & Co. International plc		06/19/19		266,654
USD	7,762,180	SEK	71,142,000	Morgan Stanley & Co. International plc		06/19/19		64,678
USD	1,886,171	SGD	2,543,000	Morgan Stanley & Co. International plc		06/19/19		6,969

SCHEDULE OF INVESTMENTS 15

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

Forward Foreign Currency Exchange Contracts (continued)

Currency Purchased		Currency Sold		Counterparty	Settlement Date		Unrealized Appreciation (Depreciation)
USD	6,056,863	THB	191,518,000	Goldman Sachs International		06/19/19	$	9,562
ZAR	344,052,000	USD	23,409,835	Morgan Stanley & Co. International plc		06/19/19		209,678
								2,130,049
AUD	42,289,000	USD	30,083,108	Morgan Stanley & Co. International plc		06/19/19		(11,782	)
BRL	20,007,000	USD	5,264,575	Bank of America NA		06/19/19		(184,187	)
BRL	52,704,000	USD	13,491,706	JPMorgan Chase Bank NA		06/19/19		(108,552	)
EUR	56,922,301	USD	64,687,950	Morgan Stanley & Co. International plc		06/19/19		(406,906	)
GBP	2,564,000	USD	3,373,532	Morgan Stanley & Co. International plc		06/19/19		(20,856	)
INR	369,106,000	USD	5,298,299	JPMorgan Chase Bank NA		06/19/19		(36,465	)
KRW	3,048,604,000	USD	2,688,956	JPMorgan Chase Bank NA		06/19/19		(3,365	)
MXN	150,454,000	USD	7,804,035	Morgan Stanley & Co. International plc		06/19/19		(150,340	)
MYR	10,034,000	USD	2,462,936	Morgan Stanley & Co. International plc		06/19/19		(9,323	)
NOK	7,160,000	USD	841,676	Morgan Stanley & Co. International plc		06/19/19		(8,992	)
PLN	13,888,000	USD	3,655,927	Morgan Stanley & Co. International plc		06/19/19		(29,672	)
SEK	49,112,000	USD	5,345,463	Morgan Stanley & Co. International plc		06/19/19		(31,588	)
USD	4,368,511	AUD	6,221,000	Morgan Stanley & Co. International plc		06/19/19		(55,186	)
USD	52,760,765	CAD	70,792,806	Morgan Stanley & Co. International plc		06/19/19		(318,534	)
USD	15,636,987	INR	1,107,646,000	Citibank NA		06/19/19		(153,192	)
USD	74,935,360	JPY	8,268,378,764	Morgan Stanley & Co. International plc		06/19/19		(130,944	)
USD	1,872,491	MXN	37,174,000	Morgan Stanley & Co. International plc		06/19/19		(18,575	)
USD	691,922	MYR	2,831,000	UBS AG		06/19/19		(342	)
USD	627,890	NOK	5,499,000	Morgan Stanley & Co. International plc		06/19/19		(11,625	)
USD	1,840,327	PLN	7,054,000	Morgan Stanley & Co. International plc		06/19/19		(1,523	)
USD	4,209,636	SEK	39,146,000	Morgan Stanley & Co. International plc		06/19/19		(25,927	)
USD	1,416,707	SGD	1,923,000	Morgan Stanley & Co. International plc		06/19/19		(4,333	)
USD	9,571,141	THB	304,056,000	Goldman Sachs International		06/19/19		(29,618	)
USD	1,318,373	ZAR	19,376,000	Morgan Stanley & Co. International plc		06/19/19		(11,808	)
								(1,763,635	)
	Net unrealized appreciation						$	366,414

Centrally Cleared Interest Rate Swaps

Paid by the Fund		Received by the Fund		Effective Date		Termination Date		Notional Amount (000)			Value			Upfront Premium Paid (Received)			Unrealized Appreciation (Depreciation)
Rate	Frequency	Rate	Frequency
28 day MXIBTIIE	Monthly	7.62%	Monthly		09/18/19(a)		09/11/24		MXN	301,000	$	(87,622	)	$	—		$	(87,622	)
28 day MXIBTIIE	Monthly	8.04%	Monthly		09/18/19(a)		09/11/24		MXN	2,036,000		1,209,742			—			1,209,742
2.23%	Semi-Annual	3 month LIBOR	Quarterly		09/18/19(a)		09/17/24		USD	50,000		89,425			(21,724	)		111,149
0.60%	Annual	3 month STIBOR	Quarterly		09/18/19(a)		09/18/24		SEK	673,000		(536,294	)		761			(537,055	)
1.84%	Semi-Annual	3 month BA	Semi-Annual		09/18/19(a)		09/18/24		CAD	188,000		552,271			75,893			476,378
2.07%	Semi-Annual	3 month BA	Semi-Annual		09/18/19(a)		09/18/24		CAD	176,000		(920,031	)		—			(920,031	)
2.08%	Semi-Annual	6 month BBR	Semi-Annual		09/18/19(a)		09/18/24		AUD	132,093		(1,592,312	)		—			(1,592,312	)
2.08%	Annual	6 month WIBOR	Semi-Annual		09/18/19(a)		09/18/24		PLN	1,416,500		(1,337,359	)		—			(1,337,359	)
2.09%	Semi-Annual	6 month SOR	Semi-Annual		09/18/19(a)		09/18/24		SGD	90,400		(448,901	)		—			(448,901	)
2.17%	Semi-Annual	3 month BA	Semi-Annual		09/18/19(a)		09/18/24		CAD	383,000		(3,425,465	)		(23,489	)		(3,401,976	)
2.59%	Semi-Annual	3 month LIBOR	Quarterly		09/18/19(a)		09/18/24		USD	99,000		(1,513,634	)		19,145			(1,532,779	)
3 month HIBOR	Quarterly	2.32%	Quarterly		09/18/19(a)		09/18/24		HKD	575,000		1,097,981			—			1,097,981
3 month JIBAR	Quarterly	7.63%	Quarterly		09/18/19(a)		09/18/24		ZAR	1,003,000		198,991			—			198,991
3 month JIBAR	Quarterly	7.81%	Quarterly		09/18/19(a)		09/18/24		ZAR	333,000		233,515			—			233,515
3 month JIBAR	Quarterly	7.85%	Quarterly		09/18/19(a)		09/18/24		ZAR	615,000		499,614			—			499,614
6 month EURIBOR	Semi-Annual	0.00%	Annual		09/18/19(a)		09/18/24		EUR	93,000		(418,269	)		(613,279	)		195,010
6 month EURIBOR	Semi-Annual	0.25%	Annual		09/18/19(a)		09/18/24		EUR	87,000		839,569			(2,463	)		842,032
6 month LIBOR	Semi-Annual	1.28%	Semi-Annual		09/18/19(a)		09/18/24		GBP	35,000		425,237			—			425,237
6 month LIBOR	Semi-Annual	1.34%	Semi-Annual		09/18/19(a)		09/18/24		GBP	561,000		9,153,765			33,703			9,120,062
											$	4,020,223		$	(531,453	)	$	4,551,676

^(a)  Forward Swap.

16 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

OTC Interest Rate Swaps

Paid by the Fund

Received by the Fund

Counterparty

Effective Date

Termination Date

Notional Amount (000)

Value

Upfront Premium Paid (Received)

Unrealized Appreciation (Depreciation)

Rate

Frequency

Rate

Frequency

8.07%

At Termination

1 day BZDIOVER

At Termination

BNP Paribas SA

N/A

01/02/23

BRL

80,942

$

25,800

$

—

$

25,800

1 week CNREPOFI

Quarterly

3.08%

Quarterly

Bank of America NA

09/18/19

(a)

09/18/24

CNY

354,986

155,376

—

155,376

1 week CNREPOFI

Quarterly

3.09%

Quarterly

BNP Paribas SA

09/18/19

(a)

09/18/24

CNY

254,251

125,155

—

125,155

1 week CNREPOFI

Quarterly

3.09%

Quarterly

BNP Paribas SA

09/18/19

(a)

09/18/24

CNY

340,210

167,469

—

167,469

1 week CNREPOFI

Quarterly

3.09%

Quarterly

JPMorgan Chase Bank NA

09/18/19

(a)

09/18/24

CNY

198,450

101,747

—

101,747

1 week CNREPOFI

Quarterly

3.11%

Quarterly

Bank of America NA

09/18/19

(a)

09/18/24

CNY

194,103

124,667

—

124,667

1 week CNREPOFI

Quarterly

3.13%

Quarterly

Bank of America NA

09/18/19

(a)

09/18/24

CNY

85,000

64,447

—

64,447

1 week CNREPOFI

Quarterly

3.13%

Quarterly

Bank of America NA

09/18/19

(a)

09/18/24

CNY

85,000

19,236

—

19,236

1.67%

Quarterly

3 month CD_KSDA

Quarterly

Bank of America NA

09/18/19

(a)

09/18/24

KRW

22,362,000

(74,021

)

—

(74,021

)

3 month KLIBOR

Quarterly

3.52%

Quarterly

Goldman Sachs International

09/18/19

(a)

09/18/24

MYR

60,500

23,194

—

23,194

3 month KLIBOR

Quarterly

3.53%

Quarterly

BNP Paribas SA

09/18/19

(a)

09/18/24

MYR

60,500

26,526

—

26,526

3 month KLIBOR

Quarterly

3.64%

Quarterly

JPMorgan Chase Bank NA

09/18/19

(a)

09/18/24

MYR

103,942

177,394

—

177,394

3 month TWCPBA

Quarterly

0.84%

Quarterly

BNP Paribas SA

09/18/19

(a)

09/18/24

TWD

525,000

18,144

—

18,144

3 month TWCPBA

Quarterly

0.89%

Quarterly

JPMorgan Chase Bank NA

09/18/19

(a)

09/18/24

TWD

814,000

90,147

—

90,147

5.85%

Semi-Annual

1 day MIBOR

Semi-Annual

Bank of America NA

09/18/19

(a)

09/18/24

INR

12,496,160

(680,668

)

—

��

(680,668

)

5.93%

Semi-Annual

1 day MIBOR

Semi-Annual

JPMorgan Chase Bank NA

09/18/19

(a)

09/18/24

INR

2,830,880

(291,022

)

—

(291,022

)

6 month THBFIX

Semi-Annual

1.88%

Semi-Annual

BNP Paribas SA

09/18/19

(a)

09/18/24

THB

375,680

12,952

—

12,952

6 month THBFIX

Semi-Annual

1.89%

Semi-Annual

BNP Paribas SA

09/18/19

(a)

09/18/24

THB

798,320

33,462

—

33,462

6 month THBFIX

Semi-Annual

1.99%

Semi-Annual

BNP Paribas SA

09/18/19

(a)

09/18/24

THB

776,650

148,266

—

148,266

6 month THBFIX

Semi-Annual

2.00%

Semi-Annual

JPMorgan Chase Bank NA

09/18/19

(a)

09/18/24

THB

1,442,350

296,835

—

296,835

$

565,106

$

—

$

565,106

^(a)  Forward Swap.

OTC Total Return Swaps

Reference Entity	Fixed Amount Paid / (Received) by the Fund (a)		Counterparty	Termination Date		Notional Amount (000)		Value		Upfront Premium Paid (Received)		Unrealized Appreciation (Depreciation)
Taiwan Capitalization Weighted Stock Index Future April 2019	TWD	62,798,269	Merrill Lynch International & Co.		04/17/19	TWD	62,798	$	25,623	$	—	$	25,623
KOSPI 200 Index Futures June 2019	KRW	12,834,260,400	Merrill Lynch International & Co.		06/13/19	KRW	12,834,260		48,930		—		48,930
KOSPI 200 Index Futures June 2019	KRW	4,692,095,200	Merrill Lynch International & Co.		06/13/19	KRW	4,692,095		17,888		—		17,888
KOSPI 200 Index Futures June 2019	KRW	11,868,240,800	Merrill Lynch International & Co.		06/13/19	KRW	11,868,241		45,246		—		45,246
KOSPI 200 Index Futures June 2019	KRW	4,623,093,800	Merrill Lynch International & Co.		06/13/19	KRW	4,623,094		17,625		—		17,625

SCHEDULE OF INVESTMENTS 17

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

OTC Total Return Swaps (continued)

Reference Entity	Fixed Amount Paid / (Received) by the Fund (a)			Counterparty		Termination Date		Notional Amount (000)		Value			Upfront Premium Paid (Received)		Unrealized Appreciation (Depreciation)
KOSPI 200 Index Futures June 2019		KRW	11,868,240,800		Merrill Lynch International & Co.		06/13/19	KRW	11,868,241	$	45,246		$	—	$	45,246
KOSPI 200 Index Futures June 2019		KRW	1,173,023,800		Merrill Lynch International & Co.		06/13/19	KRW	1,173,024		4,472			—		4,472
KOSPI 200 Index Futures June 2019		KRW	17,694,802,050		Merrill Lynch International & Co.		06/13/19	KRW	17,694,802		(81,580	)		—		(81,580	)
KOSPI 200 Index Futures June 2019		KRW	3,017,165,950		Merrill Lynch International & Co.		06/13/19	KRW	3,017,166		(32,830	)		—		(32,830	)
										$	90,620		$	—	$	90,620

^(a)  At termination, the fixed amount paid (received) will be exchanged for the total return of the reference entity.

The following reference rates, and their values as of period end, are used for security descriptions:

Reference Index		Reference Rate
1 day BZDIOVER	Overnight Brazil CETIP — Interbank Rate		0.25	%
1 day MIBOR	Mumbai Interbank Offered Rate		8.80	%
1 week CNREPOFI	7 Day China Fixing Repo Rates		2.73	%
28 day MXIBTIIE	Mexico Interbank TIIE28-Day		8.52	%
3 month BA	3 month Canadian Bankers Acceptances		2.02	%
3 month CD_KSDA	Certificates of Deposit by the Korean Securities Dealers Association		1.87	%
3 month HIBOR	Hong Kong Interbank Offered Rate		1.76	%
3 month JIBAR	Johannesburg Interbank Average Rate		7.15	%
3 month KLIBOR	Kuala Lumpur Interbank Offered Rate		3.65	%
3 month LIBOR	London Interbank Offered Rate		2.60	%
3 month STIBOR	Stockholm Interbank Offered Rate		(0.01	)%
3 month TWCPBA	Taiwan Secondary Markets Bills Rate		0.66	%
6 month BBR	Australian Bank Bill Rate		1.77	%
6 month EURIBOR	Euro Interbank Offered Rate		(0.23	)%
6 month LIBOR GBP	London Interbank Offered Rate		0.95	%
6 month SOR	Singapore Interbank Offered Rates		2.00	%
6 month THBFIX	6 month Thai Baht Interest Rate Fixing		1.40	%
6 month WIBOR	Warsaw Interbank Offered Rate		1.69	%

Balances Reported in the Statement of Assets and Liabilities for Centrally Cleared Swaps and OTC Swaps

	Swap Premiums Paid		Swap Premiums Received			Unrealized Appreciation		Unrealized Depreciation
Centrally Cleared Swaps(a)	$	129,502	$	(660,955	)	$	14,409,711	$	(9,858,035	)
OTC Swaps		—		—			1,815,847		(1,160,121	)

^(a)  Includes cumulative appreciation (depreciation) on centrally cleared swaps, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities and is net of any previously paid (received) swap premium amounts.

18 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

Derivative Financial Instruments Categorized by Risk Exposure

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

	Commodity Contracts		Credit Contracts		Equity Contracts		Foreign Currency Exchange Contracts		Interest Rate Contracts		Other Contracts		Total
Assets — Derivative Financial Instruments
Futures contracts
Net unrealized appreciation(a)	$	—	$	—	$	5,610,686	$	—	$	4,178,070	$	—	$	9,788,756
Forward foreign currency exchange contracts
Unrealized appreciation on forward foreign currency exchange contracts		—		—		—		2,130,049		—		—		2,130,049
Swaps — centrally cleared
Net unrealized appreciation(a)		—		—		—		—		14,409,711		—		14,409,711
Swaps — OTC
Unrealized appreciation on OTC swaps; Swap premiums paid		—		—		205,030		—		1,610,817		—		1,815,847
	$	—	$	—	$	5,815,716	$	2,130,049	$	20,198,598	$	—	$	28,144,363
Liabilities — Derivative Financial Instruments
Futures contracts
Net unrealized depreciation(a)	$	—	$	—	$	15,425,172	$	—	$	4,780,156	$	—	$	20,205,328
Forward foreign currency exchange contracts
Unrealized depreciation on forward foreign currency exchange contracts		—		—		—		1,763,635		—		—		1,763,635
Swaps — centrally cleared
Net unrealized depreciation(a)		—		—		—		—		9,858,035		—		9,858,035
Swaps — OTC
Unrealized depreciation on OTC swaps; Swap premiums received		—		—		114,410		—		1,045,711		—		1,160,121
	$	—	$	—	$	15,539,582	$	1,763,635	$	15,683,902	$	—	$	32,987,119

^(a)  Includes cumulative appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities.

For the six months ended March 31, 2019, the effect of derivative financial instruments in the Statement of Operations were as follows:

	Commodity Contracts		Credit Contracts		Equity Contracts			Foreign Currency Exchange Contracts			Interest Rate Contracts			Other Contracts		Total
Net Realized Gain (Loss) from:
Futures contracts	$	—	$	—	$	23,446,637		$	—		$	11,855,514		$	—	$	35,302,151
Forward foreign currency exchange contracts		—		—		—			(3,027,734	)		—			—		(3,027,734	)
Swaps		—		—		2,374,307			—			(12,511,635	)		—		(10,137,328	)
	$	—	$	—	$	25,820,944		$	(3,027,734	)	$	(656,121	)	$	—	$	22,137,089
Net Change in Unrealized Appreciation (Depreciation) on:
Futures contracts	$	—	$	—	$	(14,031,868	)	$	—		$	(2,256,101	)	$	—	$	(16,287,969	)
Forward foreign currency exchange contracts		—		—		—			722,286			—			—		722,286
Swaps		—		—		(643,638	)		—			1,213,643			—		570,005
	$	—	$	—	$	(14,675,506	)	$	722,286		$	(1,042,458	)	$	—	$	(14,995,678	)

Average Quarterly Balances of Outstanding Derivative Financial Instruments

Futures contracts:
Average notional value of contracts — long	$	570,905,775
Average notional value of contracts — short	$	863,833,631
Forward foreign currency exchange contracts:
Average amounts purchased — in USD	$	395,733,565
Average amounts sold — in USD	$	345,100,157
Interest rate swaps:
Average notional value — pays fixed rate	$	1,633,595,427
Average notional value — receives fixed rate	$	5,443,918,728
Total return swaps:
Average notional value	$	90,495,010

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

SCHEDULE OF INVESTMENTS 19

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

Derivative Financial Instruments — Offsetting as of Period End

The Fund’s derivative assets and liabilities (by type) were as follows:

	Assets			Liabilities
Derivative Financial Instruments:
Futures contracts	$	2,864,995		$	5,585,777
Forward foreign currency exchange contracts		2,130,049			1,763,635
Swaps — Centrally cleared		4,643,798			—
Swaps — OTC(a)		1,815,847			1,160,121
Total derivative assets and liabilities in the Statement of Assets and Liabilities	$	11,454,689		$	8,509,533
Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)		(7,508,793	)		(5,585,777	)
Total derivative assets and liabilities subject to an MNA	$	3,945,896		$	2,923,756

^(a)  Includes unrealized appreciation (depreciation) on OTC swaps and swap premiums (paid/received) in the Statement of Assets and Liabilities.

The following tables present the Fund’s derivative assets and liabilities by counterparty net of amounts available for offset under an MNA and net of the related collateral received and pledged by the Fund:

Counterparty	Derivative Assets Subject to an MNA by Counterparty		Derivatives Available for Offset (a)			Non-cash Collateral Received			Cash Collateral Received (b)			Net Amount of Derivative Assets (c)(e)
Bank of America NA	$	405,207	$	(405,207	)	$	—		$	—		$	—
BNP Paribas SA		647,427		—			—			(647,427	)		—
Citibank NA		49,575		(49,575	)		—			—			—
Credit Suisse International		8,836		—			—			—			8,836
Goldman Sachs International		32,756		(29,618	)		—			—			3,138
JPMorgan Chase Bank NA		679,803		(439,404	)		—			(240,399	)		—
Merrill Lynch International & Co.		205,030		(114,410	)		—			—			90,620
Morgan Stanley & Co. International plc		1,906,745		(1,247,914	)		—			—			658,831
UBS AG		10,517		(342	)		(10,175	)		—			—
	$	3,945,896	$	(2,286,470	)	$	(10,175	)	$	(887,826	)	$	761,425
Counterparty	Derivative Liabilities Subject to an MNA by Counterparty		Derivatives Available for Offset (a)			Non-cash Collateral Pledged			Cash Collateral Pledged (d)			Net Amount of Derivative Liabilities (e)
Bank of America NA	$	938,876	$	(405,207	)	$	—		$	(533,669	)	$	—
Citibank NA		153,192		(49,575	)		—			(103,617	)		—
Goldman Sachs International		29,618		(29,618	)		—			—			—
JPMorgan Chase Bank NA		439,404		(439,404	)		—			—			—
Merrill Lynch International & Co.		114,410		(114,410	)		—			—			—
Morgan Stanley & Co. International plc		1,247,914		(1,247,914	)		—			—			—
UBS AG		342		(342	)		—			—			—
	$	2,923,756	$	(2,286,470	)	$	—		$	(637,286	)	$	—

^(a)  The amount of derivatives available for offset is limited to the amount of derivative assets and/or liabilities that are subject to an MNA.

^(b)  Excess of collateral received from the individual counterparty is not shown for financial reporting purposes.

^(c)  Net amount represents the net amount receivable from the counterparty in the event of default.

^(d)  Excess of collateral pledged to the individual counterparty is not shown for financial reporting purposes.

^(e)  Net amount may also include forward foreign currency exchange contracts that are not required to be collateralized.

20 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

Fair Value Hierarchy as of Period End

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

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

	Level 1		Level 2		Level 3		Total
Assets:
Investments:
Long-Term Investments:
Common Stocks:
Aerospace & Defense	$	—	$	1,979,505	$	—	$	1,979,505
Air Freight & Logistics		1,161,649		—		—		1,161,649
Airlines		4,738,256		706,713		—		5,444,969
Auto Components		418,711		—		—		418,711
Automobiles		5,231,193		5,341,810		—		10,573,003
Banks		8,853,341		20,152,480		—		29,005,821
Beverages		1,900,048		5,751,655		—		7,651,703
Biotechnology		4,144,540		1,104,848		—		5,249,388
Capital Markets		2,976,544		2,332,995		—		5,309,539
Chemicals		2,618,824		1,852,745		—		4,471,569
Commercial Services & Supplies		6,428,356		2,513,449		—		8,941,805
Construction & Engineering		11,776,459		508,661		—		12,285,120
Construction Materials		880,409		106,374		—		986,783
Consumer Finance		1,160,061		—		—		1,160,061
Containers & Packaging		16,620,788		404,116		—		17,024,904
Distributors		—		31,226		—		31,226
Diversified Financial Services		1,152,707		1,361,440		—		2,514,147
Electric Utilities		2,664,482		2,164,485		6,112		4,835,079
Electronic Equipment, Instruments & Components		—		355,638		—		355,638
Energy Equipment & Services		580,247		192,197		—		772,444
Entertainment		6,202,136		567,224		—		6,769,360
Equity Real Estate Investment Trusts (REITs)		2,665,935		3,710,002		—		6,375,937
Food & Staples Retailing		8,735,547		3,815,443		—		12,550,990
Food Products		1,924,818		4,290,804		—		6,215,622
Gas Utilities		—		481,749		—		481,749
Health Care Equipment & Supplies		6,835,717		2,584,201		—		9,419,918
Health Care Providers & Services		11,402,906		2,074,443		—		13,477,349
Health Care Technology		475,523		28,610		—		504,133
Hotels, Restaurants & Leisure		162,038		1,071,425		—		1,233,463
Household Durables		2,595,073		33,777		—		2,628,850
Household Products		2,556,531		2,023,591		—		4,580,122
Independent Power and Renewable Electricity Producers		—		124,365		—		124,365
Industrial Conglomerates		2,135,722		690,973		—		2,826,695
Insurance		8,025,688		19,055,635		—		27,081,323
Interactive Media & Services		12,619,764		114,741		—		12,734,505
Internet & Direct Marketing Retail		12,646,133		100,497		—		12,746,630
IT Services		10,351,054		2,472,140		—		12,823,194
Life Sciences Tools & Services		953,852		330,664		—		1,284,516
Machinery		—		222,297		—		222,297
Media		6,915,836		86,675		—		7,002,511
Metals & Mining		2,737,392		1,239,415		—		3,976,807
Multiline Retail		1,473,481		909,577		—		2,383,058
Multi-Utilities		3,482,490		315,444		—		3,797,934
Oil, Gas & Consumable Fuels		12,622,750		12,870,565		—		25,493,315
Paper & Forest Products		—		31,737		—		31,737
Personal Products		536,217		6,522,256		—		7,058,473
Pharmaceuticals		22,851,078		16,451,032		—		39,302,110
Professional Services		6,072,873		1,787,210		—		7,860,083
Real Estate Management & Development		—		5,965,431		—		5,965,431
Road & Rail		62,127		92,978		—		155,105
Semiconductors & Semiconductor Equipment		158,005		—		—		158,005
Software		16,660,951		2,116,763		—		18,777,714
Specialty Retail		36,425,556		630,665		—		37,056,221
Technology Hardware, Storage & Peripherals		7,339,858		—		—		7,339,858
Textiles, Apparel & Luxury Goods		—		809,099		—		809,099

SCHEDULE OF INVESTMENTS 21

Schedule of Investments  (unaudited) (continued) March 31, 2019 BlackRock Tactical Opportunities Fund

	Level 1			Level 2			Level 3		Total
Tobacco	$	831,755		$	2,275,761		$	—	$	3,107,516
Trading Companies & Distributors		173,815			—			—		173,815
Transportation Infrastructure		—			1,320,592			—		1,320,592
Water Utilities		—			315,672			—		315,672
Wireless Telecommunication Services		—			224,196			—		224,196
Preferred Stocks(a)		—			3,098,766			—		3,098,766
U.S. Treasury Obligations		—			158,632,852			—		158,632,852
Short-Term Securities		33,595,055			—			—		33,595,055
	$	315,534,291		$	306,349,604		$	6,112	$	621,890,007
Derivative Financial Instruments(b)
Assets:
Equity contracts	$	5,610,686		$	205,030		$	—	$	5,815,716
Foreign currency exchange contracts		—			2,130,049			—		2,130,049
Interest rate contracts		4,178,070			16,020,528			—		20,198,598
Liabilities:
Equity contracts		(15,425,172	)		(114,410	)		—		(15,539,582	)
Foreign currency exchange contracts		—			(1,763,635	)		—		(1,763,635	)
Interest rate contracts		(4,780,156	)		(10,903,746	)		—		(15,683,902	)
	$	(10,416,572	)	$	5,573,816		$	—	$	(4,842,756	)

^(a)  See above Schedule of Investments for values in each industry.

^(b)  Derivative financial instruments are swaps, futures contracts and forward foreign currency exchange contracts. Swaps, futures contracts and forward foreign currency exchange contracts are valued at the unrealized appreciation (depreciation) on the instrument.

During the six months ended March 31, 2019, there were no transfers between levels.

See notes to financial statements.

22 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Statement of Assets and Liabilities  (unaudited)

March 31, 2019

	BlackRock Tactical Opportunities Fund
ASSETS
Investments at value — unaffiliated (cost — $568,100,693)	$	588,294,952
Investments at value — affiliated (cost — $33,595,055)		33,595,055
Cash		987
Cash pledged:
Collateral — OTC derivatives		1,850,000
Futures contracts		63,258,000
Centrally cleared swaps		22,235,000
Foreign currency at value (cost — $23,155,351)		23,047,379
Receivables:
Investments sold		22,941
Securities lending income — affiliated		25,009
Capital shares sold		111,830,192
Dividends — affiliated		69,266
Dividends — unaffiliated		1,172,171
Interest — unaffiliated		654,061
From the Manager		23,020
Variation margin on futures contracts		2,864,995
Variation margin on centrally cleared swaps		4,643,798
Unrealized appreciation on:
Forward foreign currency exchange contracts		2,130,049
OTC swaps		1,815,847
Prepaid expenses		54,744
Other assets		79
Total assets		857,587,545
LIABILITIES
Cash received as collateral for OTC derivatives		1,340,000
Payables:
Administration fees		38,258
Capital shares redeemed		524,722
Investment advisory fees		325,894
Trustees’ and Officer’s fees		6,429
Other affiliates		61,557
Professional fees		322,890
Service and distribution fees		68,285
Variation margin on futures contracts		5,585,777
Transfer agent fees		282,289
Other accrued expenses		243,135
Unrealized depreciation on:
Forward foreign currency exchange contracts		1,763,635
OTC swaps		1,160,121
Total liabilities		11,722,992
NET ASSETS	$	845,864,553
NET ASSETS CONSIST OF
Paid-in capital	$	860,448,150
Accumulated loss		(14,583,597	)
NET ASSETS	$	845,864,553
NET ASSET VALUE
Institutional — Based on net assets of $232,573,677 and 16,746,000 shares outstanding, unlimited number of shares authorized, $0.001 par value	$	13.89
Service — Based on net assets of $1,194,047 and 86,563 shares outstanding, unlimited number of shares authorized, $0.001 par value	$	13.79
Investor A — Based on net assets of $237,700,147 and 17,253,956 shares outstanding, unlimited number of shares authorized, $0.001 par value	$	13.78
Investor C — Based on net assets of $19,700,570 and 1,468,381 shares outstanding, unlimited number of shares authorized, $0.001 par value	$	13.42
Class K — Based on net assets of $354,696,112 and 25,595,705 shares outstanding, unlimited number of shares authorized, $0.001 par value	$	13.86

See notes to financial statements.

FINANCIAL STATEMENTS 23

Statement of Operations  (unaudited)

Six Months Ended March 31, 2019

	BlackRock Tactical Opportunities Fund
INVESTMENT INCOME
Dividends — affiliated	$	403,060
Dividends — unaffiliated		4,493,578
Interest — unaffiliated		1,882,369
Securities lending income — affiliated — net		29,210
Foreign taxes withheld		(172,218	)
Total investment income		6,635,999
EXPENSES
Investment advisory		1,878,333
Service and distribution — class specific		410,608
Transfer agent — class specific		316,453
Administration		142,841
Accounting services		70,788
Custodian		69,178
Administration — class specific		68,297
Professional		56,881
Registration		36,474
Printing		34,223
Trustees and Officer		9,814
Board realignment and consolidation		9,741
Miscellaneous		21,211
Total expenses		3,124,842
Less:
Fees waived and/or reimbursed by the Manager		(19,526	)
Total expenses after fees waived and/or reimbursed		3,105,316
Net investment income		3,530,683
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments — affiliated		(394	)
Investments — unaffiliated		(9,475,245	)
Forward foreign currency exchange contracts		(3,027,734	)
Foreign currency transactions		(648,146	)
Futures contracts		35,302,151
Swaps		(10,137,328	)
		12,013,304
Net change in unrealized appreciation (depreciation) on:
Investments — unaffiliated		(7,813,866	)
Forward foreign currency exchange contracts		722,286
Foreign currency translations		90,989
Futures contracts		(16,287,969	)
Swaps		570,005
		(22,718,555	)
Net realized and unrealized loss		(10,705,251	)
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	(7,174,568	)

See notes to financial statements.

24 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Statement of Changes in Net Assets  

	BlackRock Tactical Opportunities Fund
	Six Months Ended 03/31/19 (unaudited)			Year Ended 09/30/18
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income	$	3,530,683		$	5,360,807
Net realized gain		12,013,304			53,833,470
Net change in unrealized appreciation (depreciation)		(22,718,555	)		4,522,696
Net increase (decrease) in net assets resulting from operations		(7,174,568	)		63,716,973
DISTRIBUTIONS TO SHAREHOLDERS(a)(b)
Institutional		(17,643,157	)		(1,569,603	)
Service		(82,582	)		(6,689	)
Investor A		(21,588,975	)		(1,907,243	)
Investor B		—			(503	)
Investor C		(1,630,883	)		(218,265	)
Class K		(17,911,034	)		(1,723,712	)
Decrease in net assets resulting from distributions to shareholders		(58,856,631	)		(5,426,015	)
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from capital share transactions		223,403,402			22,578,212
NET ASSETS(b)
Total increase in net assets		157,372,203			80,869,170
Beginning of period		688,492,350			607,623,180
End of period	$	845,864,553		$	688,492,350

^(a)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(b)  Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year RegulationS-X presentation changes. Refer to Note 12 for this prior year information.

See notes to financial statements.

FINANCIAL STATEMENTS 25

Financial Highlights

(For a share outstanding throughout each period)

	BlackRock Tactical Opportunities Fund
	Institutional
	Six Months Ended 03/31/19 (unaudited)			Year Ended September 30,
				2018			2017			2016			2015			2014
Net asset value, beginning of period	$	15.44		$	14.11		$	13.41		$	14.20		$	15.52		$	15.95
Net investment income(a)		0.09			0.14			0.09			0.07			0.06			0.04
Net realized and unrealized gain (loss)		(0.25	)		1.31			0.82			(0.16	)		(0.23	)		1.04
Net increase (decrease) from investment operations		(0.16	)		1.45			0.91			(0.09	)		(0.17	)		1.08
Distributions(b)
From net investment income		(0.55	)		(0.12	)		(0.23	)		(0.51	)		(0.35	)		(0.20	)
From net realized gain		(0.84	)		—			—			(0.19	)		(0.80	)		(1.31	)
Total distributions		(1.39	)		(0.12	)		(0.23	)		(0.70	)		(1.15	)		(1.51	)
Capital Contribution		—			—			0.02			—			—			—
Net asset value, end of period	$	13.89		$	15.44		$	14.11		$	13.41		$	14.20		$	15.52
Total Return(c)
Based on net asset value		(0.86	)%(d)		10.36	%		7.05	%		(0.71	)%		(1.27	)%		7.02	%
Ratios to Average Net Assets(e)
Total expenses(f)		0.78	%(g)		0.93	%		0.92	%		0.91	%		0.84	%		0.85	%
Total expenses after fees waived and/or reimbursed		0.77	%(g)		0.89	%		0.89	%		0.87	%		0.81	%		0.82	%
Net investment income		1.18	%(g)		0.94	%		0.65	%		0.49	%		0.40	%		0.28	%
Supplemental Data
Net assets, end of period (000)	$	232,574		$	220,711		$	189,242		$	271,623		$	265,521		$	342,794
Portfolio turnover rate		122	%		265	%		257	%		359	%		295	%		181	%

^(a)  Based on average shares outstanding.

^(b)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(c)  Where applicable, assumes the reinvestment of distributions.

^(d)  Aggregate total return.

^(e)  Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

	Six Months Ended 03/31/19 (unaudited)			For the Year Ended September 30,
				2018			2017			2016			2015			2014
Investments in underlying funds		0.01	%		0.01	%		0.01	%		0.05	%		0.08	%		0.11	%

^(f)  Includes recoupment of past waived and/or reimbursed fees. Excluding the recoupment of past waived and/or reimbursed fees, the expense ratios were as follows:

	Six Months Ended 03/31/19 (unaudited)		For the Year Ended September 30,
			2018		2017		2016		2015			2014
Expense ratios		N/A		N/A		N/A		N/A		0.84	%		0.85	%

^(g)  Annualized.

See notes to financial statements.

26 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Financial Highlights  (continued)

(For a share outstanding throughout each period)

	BlackRock Tactical Opportunities Fund (continued)
	Service
	Six Months Ended 03/31/19 (unaudited)			Year Ended September 30,
				2018			2017			2016			2015			2014
Net asset value, beginning of period	$	15.33		$	14.02		$	13.34		$	14.12		$	15.44		$	15.90
Net investment income (loss)(a)		0.06			0.10			0.05			0.02			0.01			(0.01	)
Net realized and unrealized gain (loss)		(0.25	)		1.32			0.81			(0.14	)		(0.23	)		1.02
Net increase (decrease) from investment operations		(0.19	)		1.42			0.86			(0.12	)		(0.22	)		1.01
Distributions(b)
From net investment income		(0.51	)		(0.11	)		(0.20	)		(0.47	)		(0.30	)		(0.16	)
From net realized gain		(0.84	)		—			—			(0.19	)		(0.80	)		(1.31	)
Total distributions		(1.35	)		(0.11	)		(0.20	)		(0.66	)		(1.10	)		(1.47	)
Capital Contribution		—			—			0.02			—			—			—
Net asset value, end of period	$	13.79		$	15.33		$	14.02		$	13.34		$	14.12		$	15.44
Total Return(c)
Based on net asset value		(1.09	)%(d)		10.21	%		6.66	%		(0.95	)%		(1.58	)%		6.57	%
Ratios to Average Net Assets(e)
Total expenses(f)		1.12	%(g)		1.22	%		1.23	%		1.24	%		1.21	%		1.21	%
Total expenses after fees waived and/or reimbursed		1.12	%(g)		1.16	%		1.17	%		1.17	%		1.17	%		1.17	%
Net investment income (loss)		0.85	%(g)		0.65	%		0.38	%		0.17	%		0.05	%		(0.04	)%
Supplemental Data
Net assets, end of period (000)	$	1,194		$	832		$	828		$	1,667		$	1,703		$	1,703
Portfolio turnover rate		122	%		265	%		257	%		359	%		295	%		181	%

^(a)  Based on average shares outstanding.

^(b)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(c)  Where applicable, assumes the reinvestment of distributions.

^(d)  Aggregate total return.

^(e)  Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

	Six Months Ended 03/31/19 (unaudited)			For the Year Ended September 30,
				2018			2017			2016			2015			2014
Investments in underlying funds		0.01	%		0.01	%		0.01	%		0.05	%		0.08	%		0.11	%

^(f)  Includes recoupment of past waived and/or reimbursed fees. Excluding the recoupment of past waived and/or reimbursed fees, the expense ratios were as follows:

	Six Months Ended 03/31/19 (unaudited)		For the Year Ended September 30,
			2018		2017		2016			2015			2014
Expense ratios		N/A		N/A		N/A		1.23	%		1.17	%		1.17	%

^(g)  Annualized.

See notes to financial statements.

FINANCIAL HIGHLIGHTS 27

Financial Highlights  (continued)

(For a share outstanding throughout each period)

	BlackRock Tactical Opportunities Fund (continued)
	Investor A
	Six Months Ended 03/31/19 (unaudited)			Year Ended September 30,
				2018			2017			2016			2015			2014
Net asset value, beginning of period	$	15.31		$	14.02		$	13.33		$	14.12		$	15.43		$	15.89
Net investment income (loss)(a)		0.06			0.09			0.05			0.02			0.02			(0.00	)(b)
Net realized and unrealized gain (loss)		(0.24	)		1.31			0.81			(0.15	)		(0.22	)		1.01
Net increase (decrease) from investment operations		(0.18	)		1.40			0.86			(0.13	)		(0.20	)		1.01
Distributions(c)
From net investment income		(0.51	)		(0.11	)		(0.19	)		(0.47	)		(0.31	)		(0.16	)
From net realized gain		(0.84	)		—			—			(0.19	)		(0.80	)		(1.31	)
Total distributions		(1.35	)		(0.11	)		(0.19	)		(0.66	)		(1.11	)		(1.47	)
Capital Contribution		—			—			0.02			—			—			—
Net asset value, end of period	$	13.78		$	15.31		$	14.02		$	13.33		$	14.12		$	15.43
Total Return(d)
Based on net asset value		(1.04	)%(e)		10.06	%		6.66	%		(1.02	)%		(1.48	)%		6.58	%
Ratios to Average Net Assets(f)
Total expenses(g)		1.14	%(h)		1.21	%		1.20	%		1.21	%		1.14	%		1.16	%
Total expenses after fees waived and/or reimbursed		1.13	%(h)		1.20	%		1.20	%		1.18	%		1.11	%		1.13	%
Net investment income		0.79	%(h)		0.61	%		0.37	%		0.15	%		0.11	%		0.00	%
Supplemental Data
Net assets, end of period (000)	$	237,700		$	237,442		$	244,101		$	271,941		$	308,570		$	350,131
Portfolio turnover rate		122	%		265	%		257	%		359	%		295	%		181	%

^(a)  Based on average shares outstanding.

^(b)  Amount is greater than $(0.005) per share.

^(c)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(d)  Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

^(e)  Aggregate total return.

^(f)  Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

	Six Months Ended 03/31/19 (unaudited)			For the Year Ended September 30,
				2018			2017			2016			2015			2014
Investments in underlying funds		0.01	%		0.01	%		0.01	%		0.05	%		0.08	%		0.11	%

^(g)  Includes recoupment of past waived and/or reimbursed fees. Excluding the recoupment of past waived and/or reimbursed fees, the expense ratios were as follows:

	Six Months Ended 03/31/19 (unaudited)		For the Year Ended September 30,
			2018		2017			2016		2015		2014
Expense ratios		N/A		N/A		1.20	%		N/A		N/A		1.15	%

^(h)  Annualized.

See notes to financial statements.

28 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Financial Highlights  (continued)

(For a share outstanding throughout each period)

	BlackRock Tactical Opportunities Fund (continued)
	Investor C
	Six Months Ended 03/31/19 (unaudited)			Year Ended September 30,
				2018			2017			2016			2015			2014
Net asset value, beginning of period	$	14.81		$	13.64		$	12.95		$	13.73		$	15.06		$	15.60
Net investment income (loss)(a)		0.00	(b)		(0.01	)		(0.05	)		(0.07	)		(0.08	)		(0.10	)
Net realized and unrealized gain (loss)		(0.22	)		1.27			0.80			(0.15	)		(0.22	)		1.00
Net increase (decrease) from investment operations		(0.22	)		1.26			0.75			(0.22	)		(0.30	)		0.90
Distributions(c)
From net investment income		(0.33	)		(0.09	)		(0.08	)		(0.37	)		(0.23	)		(0.13	)
From net realized gain		(0.84	)		—			—			(0.19	)		(0.80	)		(1.31	)
Total distributions		(1.17	)		(0.09	)		(0.08	)		(0.56	)		(1.03	)		(1.44	)
Capital Contribution		—			—			0.02			—			—			—
Net asset value, end of period	$	13.42		$	14.81		$	13.64		$	12.95		$	13.73		$	15.06
Total Return(d)
Based on net asset value		(1.39	)%(e)		9.27	%		5.99	%		(1.70	)%		(2.20	)%		5.91	%
Ratios to Average Net Assets(f)
Total expenses(g)		1.84	%(h)		1.89	%		1.89	%		1.90	%		1.82	%		1.84	%
Total expenses after fees waived and/or reimbursed		1.84	%(h)		1.88	%		1.89	%		1.87	%		1.79	%		1.81	%
Net investment income (loss)		0.04	%(h)		(0.08	)%		(0.34	)%		(0.54	)%		(0.57	)%		(0.68	)%
Supplemental Data
Net assets, end of period (000)	$	19,701		$	31,022		$	35,343		$	54,050		$	65,728		$	74,467
Portfolio turnover rate		122	%		265	%		257	%		359	%		295	%		181	%

^(a)  Based on average shares outstanding.

^(b)  Amount is less than $0.005 per share.

^(c)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(d)  Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

^(e)  Aggregate total return.

^(f)  Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

	Six Months Ended 03/31/19 (unaudited)			For the Year Ended September 30,
				2018			2017			2016			2015			2014
Investments in underlying funds		0.01	%		0.01	%		0.01	%		0.05	%		0.08	%		0.11	%

^(g)  Includes recoupment of past waived and/or reimbursed fees. Excluding the recoupment of past waived and/or reimbursed fees, for the year ended September 30, 2014, the ratio would have been 1.83%.

^(h)  Annualized.

See notes to financial statements.

FINANCIAL HIGHLIGHTS 29

Financial Highlights  (continued)

(For a share outstanding throughout each period)

	BlackRock Tactical Opportunities Fund (continued)
	Class K
	Six Months Ended 03/31/19 (unaudited)			Year Ended September 30,						Period from 08/01/16 (a) to 09/30/16
				2018			2017
Net asset value, beginning of period	$	15.43		$	14.08		$	13.42		$	13.41
Net investment income(b)		0.09			0.16			0.13			0.03
Net realized and unrealized gain (loss)		(0.24	)		1.32			0.79			(0.02	)
Net increase (decrease) from investment operations		(0.15	)		1.48			0.92			0.01
Distributions(c)
From net investment income		(0.58	)		(0.13	)		(0.26	)		—
From net realized gain		(0.84	)		—			—			—
Total distributions		(1.42	)		(0.13	)		(0.26	)		—
Net asset value, end of period	$	13.86		$	15.43		$	14.08		$	13.42
Total Return(d)
Based on net asset value		(0.84	)%(e)		10.57	%		6.93	%		0.07	%(e)
Ratios to Average Net Assets(f)
Total expenses		0.70	%(g)		0.76	%		0.77	%		0.78	%(g)(h)
Total expenses after fees waived and/or reimbursed		0.70	%(g)		0.75	%		0.77	%		0.75	%(g)
Net investment income		1.27	%(g)		1.09	%		0.94	%		1.20	%(g)
Supplemental Data
Net assets, end of period (000)	$	354,696		$	198,487		$	138,018		$	200
Portfolio turnover rate		122	%		265	%		257	%		359	%(i)

^(a)  Commencement of operations.

^(b)  Based on average shares outstanding.

^(c)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

^(d)  Where applicable, assumes the reinvestment of distributions.

^(e)  Aggregate total return.

^(f)  Excludes expenses incurred indirectly as a result of investments in underlying funds as follows:

	Six Months Ended 03/31/19 (unaudited)			For the Year Ended September 30,						Period from 08/01/16 to 09/30/16
				2018			2017
Investments in underlying funds		0.01	%		0.01	%		0.01	%		0.05	%

^(g)  Annualized.

^(h)  Includes recoupment of past waived and/or reimbursed fees with no financial impact to the expense ratio.

⁽ⁱ⁾  Portfolio turnover rate is representative of the Portfolio for the entire year.

See notes to financial statements.

30 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements

1. ORGANIZATION

BlackRock Funds^SM (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as anopen-end management investment company. The Trust is organized as a Massachusetts business trust. BlackRock Tactical Opportunities Fund (the “Fund”) is a series of the Trust. The Fund is classified as diversified.

The Fund offers multiple classes of shares. All classes of shares have identical voting, dividend, liquidation and other rights and are subject to the same terms and conditions, except that certain classes bear expenses related to the shareholder servicing and distribution of such shares. Institutional, Service and Class K Shares are sold only to certain eligible investors. Investor A and Investor C Shares are generally available through financial intermediaries. Investor C Shares may be subject to a contingent deferred sales charge (“CDSC”). However, the CDSC does not apply to redemptions by certain employer-sponsored retirement plans or to redemptions of shares acquired through the reinvestment of dividends and capital gains by existing shareholders. Effective November 8, 2018, the Fund adopted an automatic conversion feature whereby Investor C Shares held for approximately ten years will be automatically converted into Investor A Shares, and, thereafter, investors will be subject to lower ongoing fees. Each class has exclusive voting rights with respect to matters relating to its shareholder servicing and distribution expenditures (except that Investor C shareholders may vote on material changes to the Investor A distribution and service plan).

Share Class	Initial Sales Charge	CDSC			Conversion Privilege
Institutional, Service and Class K Shares	No		No		None
Investor A Shares	Yes		No	(a)	None
Investor C Shares	No		Yes		To Investor A Shares after approximately 10 years

^(a)  Investor A Shares may be subject to a CDSC for certain redemptions where no initial sales charge was paid at the time of purchase.

The Fund, together with certain other registered investment companies advised by BlackRock Advisors, LLC (the “Manager”) or its affiliates, is included in a complex of equity, multi-asset, index and money market funds referred to as the BlackRock Multi-Asset Complex.

2 SIGNIFICANT ACCOUNTING POLICIES

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

Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined on the identified cost basis. Dividend income is recorded on theex-dividend date. Dividends from foreign securities where theex-dividend date may have passed are subsequently recorded when the Fund is informed of theex-dividend date. Under the applicable foreign tax laws, a withholding tax at various rates may be imposed on capital gains, dividends and interest. Upon notification from issuers, a portion of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized on an accrual basis. Income, expenses and realized and unrealized gains and losses are allocated daily to each class based on its relative net assets.

Foreign Currency Translation: The Fund’s books and records are maintained in U.S. dollars. Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars using exchange rates determined as of the close of trading on the New York Stock Exchange (“NYSE”). Purchases and sales of investments are recorded at the rates of exchange prevailing on the respective dates of such transactions. Generally, when the U.S. dollar rises in value against a foreign currency, the investments denominated in that currency will lose value; the opposite effect occurs if the U.S. dollar falls in relative value.

The Fund does not isolate the portion of the results of operations arising as a result of changes in the exchange rates from the changes in the market prices of investments held or sold for financial reporting purposes. Accordingly, the effects of changes in exchange rates on investments are not segregated in the Statement of Operations from the effects of changes in market prices of those investments, but are included as a component of net realized and unrealized gain (loss) from investments. The Fund reports realized currency gains (losses) on foreign currency related transactions as components of net realized gain (loss) for financial reporting purposes, whereas such components are generally treated as ordinary income for U.S. federal income tax purposes.

Segregation and Collateralization: In cases where the Fund enters into certain investments (e.g., futures contracts, forward foreign currency exchange contracts and swaps) that would be treated as “senior securities” for 1940 Act purposes, the Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Fund may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.

Distributions: Distributions paid by the Fund are recorded on theex-dividend date. Distributions of capital gains are recorded on theex-dividend date and made at least annually. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.

Recent Accounting Standards: In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update “Premium Amortization of Purchased Callable Debt Securities” which amends the amortization period for certain purchased callable debt securities. Under the new guidance, the premium amortization of purchased callable debt securities that have explicit,non-contingent call features and are callable at fixed prices will be amortized to the earliest call date. The

NOTESTO FINANCIAL STATEMENTS 31

Notes to Financial Statements  (continued)

guidance will be applied on a modified retrospective basis and is effective for fiscal years, and their interim periods, beginning after December 15, 2018. Management continues to evaluate the impact of this guidance to the Fund.

In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update2018-13 “Changes to the Disclosure Requirements for Fair Value Measurement” which modifies disclosure requirements for fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years. Management continues to evaluate the impact of this guidance to the Fund.

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

Other: Expenses directly related to the Fund or its classes are charged to the Fund or the applicable class. Other operating expenses shared by several funds, including other funds managed by the Manager, are prorated among those funds on the basis of relative net assets or other appropriate methods. Expenses directly related to the Fund and other shared expenses prorated to the Fund are allocated daily to each class based on its relative net assets or other appropriate methods.

3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investment Valuation Policies: The Fund’s investments are valued at fair value (also referred to as “market value” within the financial statements) as of the close of trading on the NYSE (generally 4:00 p.m., Eastern time) (or if the reporting date falls on a day the NYSE is closed, investments are valued at fair value as of the period end). U.S. GAAP defines fair value as the price the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Fund determines the fair values of its financial instruments using various independent dealers or pricing services under policies approved by the Board of Trustees of the Trust (the “Board”). The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.

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

• Equity investments traded on a recognized securities exchange are valued at the official closing price each day, if available. For equity investments traded on more than one exchange, the official closing price on the exchange where the stock is primarily traded is used. Equity investments traded on a recognized exchange for which there were no sales on that day may be valued at the last available bid (long positions) or ask (short positions) price.

Generally, trading in foreign instruments is substantially completed each day at various times prior to the close of trading on the NYSE. Occasionally, events affecting the values of such instruments may occur between the foreign market close and the close of trading on the NYSE that may not be reflected in the computation of the Fund’s net assets. Each business day, the Fund uses a pricing service to assist with the valuation of certain foreign exchange-traded equity securities and foreign exchange-traded and over-the-counter (“OTC”) options (the “Systematic Fair Value Price”). Using current market factors, the Systematic Fair Value Price is designed to value such foreign securities and foreign options at fair value as of the close of trading on the NYSE, which follows the close of the local markets.

• Fixed-income securities for which market quotations are readily available are generally valued using the last available bid prices or current market quotations provided by independent dealers or third party pricing services. Floating rate loan interests are valued at the mean of the bid prices from one or more independent brokers or dealers as obtained from a third party pricing service. Pricing services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but a fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots may trade at lower prices than institutional round lots. The pricing services may use matrix pricing or valuation models that utilize certain inputs and assumptions to derive values, including transaction data (e.g., recent representative bids and offers), credit quality information, perceived market movements, news, and other relevant information. Certain fixed-income securities, including asset-backed and mortgage related securities may be valued based on valuation models that consider the estimated cash flows of each tranche of the entity, establish a benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche. The amortized cost method of valuation may be used with respect to debt obligations with sixty days or less remaining to maturity unless the Manager determines such method does not represent fair value.

• Investments inopen-end U.S. mutual funds are valued at NAV each business day.

• The Fund values its investment in SL Liquidity Series, LLC, Money Market Series (the “Money Market Series”) at fair value, which is ordinarily based upon its pro rata ownership in the underlying fund’s net assets. The Money Market Series seeks current income consistent with maintaining liquidity and preserving capital. Although the Money Market Series is not registered under the 1940 Act, its investments may follow the parameters of investments by a money market fund that is subject to Rule2a-7 under the 1940 Act.

• Futures contracts traded on exchanges are valued at their last sale price.

• Forward foreign currency exchange contracts are valued at the mean between the bid and ask prices and are determined as of the close of trading on the NYSE. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available.

• Swap agreements are valued utilizing quotes received daily by the Fund’s pricing service or through brokers, which are derived using daily swap curves and models that incorporate a number of market data factors, such as discounted cash flows, trades and values of the underlying reference instruments.

If events (e.g., a company announcement, market volatility or a natural disaster) occur that are expected to materially affect the value of such investments, or in the event that the application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a

32 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements  (continued)

price is not available, the investment will be valued by the Global Valuation Committee, or its delegate, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee will include market approach, income approach and cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that the Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in anarm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement.

The Global Valuation Committee, or its delegate, employs various methods for calibrating valuation approaches for investments where an active market does not exist, including regular due diligence of the Fund’s pricing vendors, regular reviews of key inputs and assumptions, transactional back-testing or disposition analysis to compare unrealized gains and losses to realized gains and losses, reviews of missing or stale prices and large movements in market values and reviews of any market related activity. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis. As a result of the inherent uncertainty in valuation of these investments, the fair values may differ from the values that would have been used had an active market existed.

For investments in equity or debt issued by privately held companies or funds (“Private Company” or collectively, the “Private Companies”) and other Fair Valued Investments, the fair valuation approaches that are used by third party pricing services utilize one or a combination of, but not limited to, the following inputs.

	Standard Inputs Generally Considered By Third Party Pricing Services
Market approach	(i)  recent market transactions, including subsequent rounds of financing, in the underlying investment or comparable issuers; (ii) recapitalizations and other transactions across the capital structure; and (iii)   market multiples of comparable issuers.
Income approach	(i)  future cash flows discounted to present and adjusted as appropriate for liquidity, credit, and/or market risks; (ii) quoted prices for similar investments or assets in active markets; and (iii)   other risk factors, such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, recovery rates, liquidation amounts and/or default rates.
Cost approach	(i)  audited or unaudited financial statements, investor communications and financial or operational metrics issued by the Private Company; (ii) changes in the valuation of relevant indices or publicly traded companies comparable to the Private Company; (iii)   relevant news and other public sources; and (iv)   known secondary market transactions in the Private Company’s interests and merger or acquisition activity in companies comparable to the Private Company.

Investments in series of preferred stock issued by Private Companies are typically valued utilizing market approach in determining the enterprise value of the company. Such investments often contain rights and preferences that differ from other series of preferred and common stock of the same issuer. Valuation techniques such as an option pricing model (“OPM”), a probability weighted expected return model (“PWERM”) or a hybrid of those techniques are used in allocating enterprise value of the company, as deemed appropriate under the circumstances. The use of OPM and PWERM techniques involve a determination of the exit scenarios of the investment in order to appropriately allocate the enterprise value of the company among the various parts of its capital structure.

The Private Companies are not subject to the public company disclosure, timing, and reporting standards as other investments held by the Fund. Typically, the most recently available information by a Private Company is as of a date that is earlier than the date the Fund is calculating its NAV. This factor may result in a difference between the value of the investment and the price the Fund could receive upon the sale of the investment.

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

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

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

• Level 3 — Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by Private Companies. There may not be a secondary market, and/or there are a limited number of investors. Level 3 investments may also be adjusted to reflect illiquidity and/ornon-transferability, with the amount of such discount estimated by the Global Valuation Committee in the absence of market information.

Changes in valuation techniques may result in transfers into or out of an assigned level within the hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investments and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

NOTESTO FINANCIAL STATEMENTS 33

Notes to Financial Statements  (continued)

4. SECURITIES AND OTHER INVESTMENTS

Asset-Backed and Mortgage-Backed Securities: Asset-backed securities are generally issued as pass-through certificates or as debt instruments. Asset-backed securities issued as pass-through certificates represent undivided fractional ownership interests in an underlying pool of assets. Asset-backed securities issued as debt instruments, which are also known as collateralized obligations, are typically issued as the debt of a special purpose entity organized solely for the purpose of owning such assets and issuing such debt. Asset-backed securities are often backed by a pool of assets representing the obligations of a number of different parties. The yield characteristics of certain asset-backed securities may differ from traditional debt securities. One such major difference is that all or a principal part of the obligations may be prepaid at any time because the underlying assets (i.e., loans) may be prepaid at any time. As a result, a decrease in interest rates in the market may result in increases in the level of prepayments as borrowers, particularly mortgagors, refinance and repay their loans. An increased prepayment rate with respect to an asset-backed security will have the effect of shortening the maturity of the security. In addition, a fund may subsequently have to reinvest the proceeds at lower interest rates. If a fund has purchased such an asset-backed security at a premium, a faster than anticipated prepayment rate could result in a loss of principal to the extent of the premium paid.

For mortgage pass-through securities (the “Mortgage Assets”) there are a number of important differences among the agencies and instrumentalities of the U.S. Government that issue mortgage-related securities and among the securities that they issue. For example, mortgage-related securities guaranteed by Ginnie Mae are guaranteed as to the timely payment of principal and interest by Ginnie Mae and such guarantee is backed by the full faith and credit of the United States. However, mortgage-related securities issued by Freddie Mac and Fannie Mae, including Freddie Mac and Fannie Mae guaranteed mortgage pass-through certificates, which are solely the obligations of Freddie Mac and Fannie Mae, are not backed by or entitled to the full faith and credit of the United States, but are supported by the right of the issuer to borrow from the U.S. Treasury.

Non-agency mortgage-backed securities are securities issued bynon-governmental issuers and have no direct or indirect government guarantees of payment and are subject to various risks.Non-agency mortgage loans are obligations of the borrowers thereunder only and are not typically insured or guaranteed by any other person or entity. The ability of a borrower to repay a loan is dependent upon the income or assets of the borrower. A number of factors, including a general economic downturn, acts of God, terrorism, social unrest and civil disturbances, may impair a borrower’s ability to repay its loans.

Collateralized Debt Obligations: Collateralized debt obligations (“CDOs”), including collateralized bond obligations (“CBOs”) and collateralized loan obligations (“CLOs”), are types of asset-backed securities. A CDO is an entity that is backed by a diversified pool of debt securities (CBOs) or syndicated bank loans (CLOs). The cash flows of the CDO can be split into multiple segments, called “tranches,” which will vary in risk profile and yield. The riskiest segment is the subordinated or “equity” tranche. This tranche bears the greatest risk of defaults from the underlying assets in the CDO and serves to protect the other, more senior, tranches from default in all but the most severe circumstances. Since it is shielded from defaults by the more junior tranches, a “senior” tranche will typically have higher credit ratings and lower yields than their underlying securities, and often receive investment grade ratings from one or more of the nationally recognized rating agencies. Despite the protection from the more junior tranches, senior tranches can experience substantial losses due to actual defaults, increased sensitivity to future defaults and the disappearance of one or more protecting tranches as a result of changes in the credit profile of the underlying pool of assets.

Preferred Stocks: Preferred stock has a preference over common stock in liquidation (and generally in receiving dividends as well), but is subordinated to the liabilities of the issuer in all respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element varies inversely with interest rates and perceived credit risk, while the market price of convertible preferred stock generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors. Preferred stock also may be subject to optional or mandatory redemption provisions.

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

The market value of any securities on loan, all of which were classified as common stocks in the Fund’s Schedule of Investments, and the value of any related collateral are shown separately in the Statement of Assets and Liabilities as a component of investments at value — unaffiliated, and collateral on securities loaned at value, respectively. As of period end, any securities on loan were collateralized by cash and/or U.S. Government obligations. Cash collateral invested by the securities lending agent, BlackRock Investment Management, LLC (“BIM”), if any, is disclosed in the Schedules of Investments.

Securities lending transactions are entered into by the Fund under Master Securities Lending Agreements (each, an “MSLA”), which provide the right, in the event of default (including bankruptcy or insolvency), for thenon-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the Fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. When the value of the collateral is greater than that of the market value of the securities loaned, the lender is left with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, absent an event of default, the borrower can resell orre-pledge the loaned securities, and the Fund can reinvest cash collateral received in connection with loaned securities. Upon an event of default, the parties’ obligations to return the securities or collateral to the other party are extinguished, and the parties can resell orre-pledge the loaned securities or the collateral received in connection with the loaned securities in order to satisfy the defaulting party’s net payment obligation for all transactions under the MSLA. The defaulting party remains liable for any deficiency.

34 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements  (continued)

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, the Fund benefits from a borrower default indemnity provided by BIM. BIM’s indemnity allows for full replacement of the securities loaned if the collateral received does not cover the value on the securities loaned in the event of borrower default. The Fund could incur a loss if the value of an investment purchased with cash collateral falls below the market value of loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received.

5. DERIVATIVE FINANCIAL INSTRUMENTS

The Fund engages in various portfolio investment strategies using derivative contracts both to increase the returns of the Fund and/or to manage its exposure to certain risks such as credit risk, equity risk, interest rate risk, foreign currency exchange rate risk, commodity price risk or other risks (e.g., inflation risk). Derivative financial instruments categorized by risk exposure are included in the Schedule of Investments. These contracts may be transacted on an exchange or OTC.

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

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

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

Forward Foreign Currency Exchange Contracts: Forward foreign currency exchange contracts are entered into to gain or reduce exposure to foreign currencies (foreign currency exchange rate risk).

A forward foreign currency exchange contract is an agreement between two parties to buy and sell a currency at a set exchange rate on a specified date. These contracts help to manage the overall exposure to the currencies in which some of the investments held by the Fund are denominated and in some cases, may be used to obtain exposure to a particular market.

The contract ismarked-to-market daily and the change in market value is recorded as unrealized appreciation (depreciation) in the Statement of Assets and Liabilities. When a contract is closed, a realized gain or loss is recorded in the Statement of Operations equal to the difference between the value at the time it was opened and the value at the time it was closed.Non-deliverable forward foreign currency exchange contracts are settled with the counterparty in cash without the delivery of foreign currency. The use of forward foreign currency exchange contracts involves the risk that the value of a forward foreign currency exchange contract changes unfavorably due to movements in the value of the referenced foreign currencies. Cash amounts pledged for forward foreign currency exchange contracts are considered restricted and are included in cash pledged as collateral for OTC derivatives in the Statement of Assets and Liabilities.

Swaps: Swap contracts are entered into to manage exposure to issuers, markets and securities. Such contracts are agreements between the Fund and a counterparty to make periodic net payments on a specified notional amount or a net payment upon termination. Swap agreements are privately negotiated in the OTC market and may be entered into as a bilateral contract (“OTC swaps”) or centrally cleared (“centrally cleared swaps”).

For OTC swaps, any upfront premiums paid and any upfront fees received are shown as swap premiums paid and swap premiums received, respectively, in the Statement of Assets and Liabilities and amortized over the term of the contract. The daily fluctuation in market value is recorded as unrealized appreciation (depreciation) on OTC Swaps in the Statement of Assets and Liabilities. Payments received or paid are recorded in the Statement of Operations as realized gains or losses, respectively. When an OTC swap is terminated, a realized gain or loss is recorded in the Statement of Operations equal to the difference between the proceeds from (or cost of) the closing transaction and the Fund’s basis in the contract, if any. Generally, the basis of the contract is the premium received or paid.

In a centrally cleared swap, immediately following execution of the swap contract, the swap contract is novated to a central counterparty (the “CCP”) and the Fund’s counterparty on the swap agreement becomes the CCP. The Fund is required to interface with the CCP through the broker. Upon entering into a centrally cleared swap, the Fund is required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on the size and risk profile of the particular swap. Securities deposited as initial margin are designated in the Schedule of Investments and cash deposited is shown as cash pledged for centrally cleared swaps in the Statement of Assets and Liabilities. Amounts pledged, which are considered restricted cash, are included in cash pledged for centrally cleared swaps in the Statement of Assets and Liabilities. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and shown as variation margin receivable (or payable) on centrally cleared swaps in the Statement of Assets and Liabilities. Payments received from (paid to) the counterparty, including at termination, are recorded as realized gains (losses) in the Statement of Operations.

• Total return swaps — Total return swaps are entered into to obtain exposure to a security or market without owning such security or investing directly in such market or to exchange the risk/return of one market (e.g., fixed-income) with another market (e.g., equity or commodity prices) (equity risk, commodity price risk and/or interest rate risk).

NOTESTO FINANCIAL STATEMENTS 35

Notes to Financial Statements  (continued)

Total return swaps are agreements in which there is an exchange of cash flows whereby one party commits to make payments based on the total return (distributions plus capital gains/losses) of an underlying instrument, or basket or underlying instruments, in exchange for fixed or floating rate interest payments. If the total return of the instrument(s) or index underlying the transaction exceeds or falls short of the offsetting fixed or floating interest rate obligation, the Fund receives payment from or makes a payment to the counterparty.

• Interest rate swaps — Interest rate swaps are entered into to gain or reduce exposure to interest rates or to manage duration, the yield curve or interest rate (interest rate risk).

Interest rate swaps are agreements in which one party pays a stream of interest payments, either fixed or floating, in exchange for another party’s stream of interest payments, either fixed or floating, on the same notional amount for a specified period of time. In more complex interest rate swaps, the notional principal amount may decline (or amortize) over time.

• Forward swaps — The Fund enters into forward interest rate swaps and forward total return swaps. In a forward swap, the Fund and the counterparty agree to make periodic net payments beginning on a specified date or a net payment at termination.

Swap transactions involve, to varying degrees, elements of interest rate, credit and market risk in excess of the amounts recognized in the Statement of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of the contractual terms in the agreements, and that there may be unfavorable changes in interest rates and/or market values associated with these transactions.

Master Netting Arrangements: In order to define its contractual rights and to secure rights that will help it mitigate its counterparty risk, the Fund may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or similar agreement with its counterparties. An ISDA Master Agreement is a bilateral agreement between the Fund and a counterparty that governs certain OTC derivatives and typically contains, among other things, collateral posting terms and netting provisions in the event of a default and/or termination event. Under an ISDA Master Agreement, the Fund may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default including the bankruptcy or insolvency of the counterparty. Bankruptcy or insolvency laws of a particular jurisdiction may restrict or prohibit the right of offset in bankruptcy, insolvency or other events.

Collateral Requirements: For derivatives traded under an ISDA Master Agreement, the collateral requirements are typically calculated by netting themark-to-market amount for each transaction under such agreement and comparing that amount to the value of any collateral currently pledged by the Fund and the counterparty.

Cash collateral that has been pledged to cover obligations of the Fund and cash collateral received from the counterparty, if any, is reported separately in the Statement of Assets and Liabilities as cash pledged as collateral and cash received as collateral, respectively.Non-cash collateral pledged by the Fund, if any, is noted in the Schedule of Investments. Generally, the amount of collateral due from or to a counterparty is subject to a certain minimum transfer amount threshold before a transfer is required, which is determined at the close of business of the Fund. Any additional required collateral is delivered to/pledged by the Fund on the next business day. Typically, the counterparty is not permitted to sell,re-pledge or use cash andnon-cash collateral it receives. The Fund generally agrees not to usenon-cash collateral that it receives but may, absent default or certain other circumstances defined in the underlying ISDA Master Agreement, be permitted to use cash collateral received. In such cases, interest may be paid pursuant to the collateral arrangement with the counterparty. To the extent amounts due to the Fund from its counterparties are not fully collateralized, it bears the risk of loss from counterpartynon-performance. Likewise, to the extent the Fund has delivered collateral to a counterparty and stands ready to perform under the terms of its agreement with such counterparty, it bears the risk of loss from a counterparty in the amount of the value of the collateral in the event the counterparty fails to return such collateral. Based on the terms of agreements, collateral may not be required for all derivative contracts.

For financial reporting purposes, the Fund does not offset derivative assets and derivative liabilities that are subject to netting arrangements, if any, in the Statement of Assets and Liabilities.

6. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Advisory: The Trust, on behalf of the Fund, entered into an Investment Advisory Agreement with the Manager, the Fund’s investment adviser and an indirect, wholly-owned subsidiary of BlackRock, Inc. (“BlackRock”), to provide investment services. The Manager is responsible for the management of the Fund’s portfolio and provides the personnel, facilities, equipment and certain other services necessary to the operations of the Fund.

For such services, the Fund pays the Manager a monthly fee at an annual rate equal to the following percentages of the average daily value of the Fund’s net assets.

Average Daily Net Assets	Investment Advisory Fee
First $1 Billion		0.550	%
$1 Billion — $2 Billion		0.500
$2 Billion — $3 Billion		0.475
Greater than $3 Billion		0.450

The Manager entered into separatesub-advisory agreements with BlackRock Asset Management North Asia Limited (“BAMNA”) and BlackRock (Singapore) Limited (“BRS”) collectively, the“Sub-Advisors”, each an affiliate of the Manager. The Manager pays BAMNA and BRS for services they provide for that portion of the Fund for which BAMNA and BRS, as applicable, acts assub-adviser, a monthly fee that is equal to a percentage of the investment advisory fees paid by the Fund to the Manager.

36 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements  (continued)

Service and Distribution Fees: The Trust, on behalf of the Fund, entered into a Distribution Agreement and a Distribution and Service Plan with BlackRock Investments, LLC (“BRIL”), an affiliate of the Manager. Pursuant to the Distribution and Service Plan and in accordance with Rule12b-1 under the 1940 Act, the Fund pays BRIL ongoing service and distribution fees. The fees are accrued daily and paid monthly at annual rates based upon the average daily net assets of the relevant share class of the Fund as follows:

	Service			Investor A			Investor C
Distribution Fees		—			—			0.75	%
Service Fees		0.25	%		0.25	%		0.25

BRIL and broker-dealers, pursuant tosub-agreements with BRIL, provide shareholder servicing and distribution services to the Fund. The ongoing service and/or distribution fee compensates BRIL and each broker-dealer for providing shareholder servicing and/or distribution related services to shareholders.

For the six months ended March 31, 2019, the following table shows the class specific service and distribution fees borne directly by each share class of the Fund:

	Service		Investor A		Investor C		Total
Service and distribution Fees	$	1,153	$	297,046	$	112,409	$	410,608

Administration: The Trust, on behalf of the Fund, entered into an Administration Agreement with the Manager, an indirect, wholly-owned subsidiary of BlackRock, to provide administrative services. For these services, the Manager receives an administration fee computed daily and payable monthly, based on a percentage of the average daily net assets of the Fund. The administration fee, which is shown as administration in the Statement of Operations, is paid at the annual rates below.

Average Daily Net Assets	Administration Fees
First $500 Million		0.0425	%
$500 Million — $1 Billion		0.0400
$1 Billion — $2 Billion		0.0375
$2 Billion — $4 Billion		0.0350
$4 Billion — $13 Billion		0.0325
Greater than $13 Billion		0.0300

In addition, the Manager charges each of the share classes an administration fee, which is shown as administration – class specific in the Statement of Operations, at an annual rate of 0.02% of the average daily net assets of each respective class.

For the six months ended March 31, 2019, the Fund paid the following to the Manager in return for these services, which are included in administration – class specific in the Statement of Operations:

Institutional		Service		Investor A		Investor C		Class K		Total
$	21,318	$	92	$	23,762	$	2,248	$	20,877	$	68,297

Transfer Agent: Pursuant to written agreements, certain financial intermediaries, some of which may be affiliates, provide the Fund withsub-accounting, recordkeeping,sub-transfer agency and other administrative services with respect to servicing of underlying investor accounts. For these services, these entities receive an asset-based fee or an annual fee per shareholder account, which will vary depending on share class and/or net assets. For the six months ended March 31, 2019, the Fund paid the following amounts to affiliates of BlackRock in return for these services, which are included in transfer agent — class specific in the Statement of Operations:

Institutional		Service		Investor A		Total
$	101,992	$	246	$	241	$	102,479

The Manager maintains a call center that is responsible for providing certain shareholder services to the Fund. Shareholder services include responding to inquiries and processing purchases and sales based upon instructions from shareholders. For the six months ended March 31, 2019, the Fund reimbursed the Manager the following amounts for costs incurred in running the call center, which are included in transfer agent — class specific in the Statement of Operations:

Institutional		Service		Investor A		Investor C		Class K		Total
$	756	$	69	$	39,723	$	1,446	$	234	$	42,228

For the six months ended March 31, 2019, the following table shows the class specific transfer agent fees borne directly by each share class of the Fund:

Institutional		Service		Investor A		Investor C		Class K		Total
$	79,113	$	800	$	220,300	$	15,845	$	395	$	316,453

Other Fees: For the six months ended March 31, 2019, affiliates earned underwriting discounts, direct commissions and dealer concessions on sales of the Fund’s Investor A Shares of $6,302.

For the six months ended March 31, 2019, affiliates received CDSCs as follows:

Investor A		Investor C
$	8	$	651

NOTESTO FINANCIAL STATEMENTS 37

Notes to Financial Statements  (continued)

Expense Limitations, Waivers, Reimbursements, and Recoupments: With respect to the Fund, the Manager voluntarily agreed to waive its investment advisory fees by the amount of investment advisory fees the Fund pays to the Manager indirectly through its investment in affiliated money market funds (the “affiliated money market fund waiver”). These amounts are included in fees waived and/or reimbursed by the Manager in the Statement of Operations. The amount of waivers and/or reimbursements of fees and expenses made pursuant to the expense limitation described below will be reduced by the amount of the affiliated money market fund waiver. For the six months ended March 31, 2019, the amount waived was $12,905.

The Manager has contractually agreed to waive its investment advisory fee with respect to any portion of the Fund’s assets invested in affiliated equity and fixed-income mutual funds and affiliated exchange-traded funds that have a contractual management fee through January 31, 2020. The contractual agreement may be terminated upon 90 days’ notice by a majority of the trustee who are not “interested persons” of the Fund, as defined in the 1940 Act (“Independent Trustees”), or by a vote of a majority of the outstanding voting securities of the Fund. For the six months ended March 31, 2019, there were no fees waived by the Manager pursuant to this arrangement.

The Fund has incurred expenses in connection with the realignment and consolidation of the boards of trustees of certain BlackRock-advised funds. The Manager has voluntarily agreed to reimburse the Fund for all or a portion of such expenses, which amounts are included in fees waived and/or reimbursed by the Manager in the Statement of Operations. For the six months ended March 31, 2019, the amount reimbursed was $6,621.

The Manager contractually agreed to waive and/or reimburse fees or expenses in order to limit expenses, excluding interest expense, dividend expense, tax expense, acquired fund fees and expenses, and certain other fund expenses, which constitute extraordinary expenses not incurred in the ordinary course of the Fund’s business (“expense limitation”). The expense limitations as a percentage of average daily net assets are as follows:

Institutional		Service		Investor A		Investor C		Class K
	0.89%		1.17%		1.37%		2.14%		0.84%

The Manager has agreed not to reduce or discontinue these contractual expense limitations through January 31, 2020, unless approved by the Board, including a majority of the Independent Trustees, or by a vote of a majority of the outstanding voting securities of the Fund. For the six months ended March 31, 2019, there were no fees waived and/or reimbursed by the Manager pursuant to this arrangement.

With respect to the contractual expense limitation, if during the Fund’s fiscal year the operating expenses of a share class, that at any time during the prior two fiscal years received a waiver and/or reimbursement from the Manager, are less than the current expense limitation for that share class, the Manager is entitled to be reimbursed by such share class up to the lesser of: (a) the amount of fees waived and/or expenses reimbursed during those prior two fiscal years under the agreement and (b) an amount not to exceed either the current expense limitation of that share class or the expense limitation of the share class in effect at the time that the share class received the applicable waiver and/or reimbursement, provided that:

• the Fund, of which the share class is a part, has more than $50 million in assets for the fiscal year, and

• the Manager or an affiliate continues to serve as the Fund’s investment adviser or administrator.

This repayment applies only to the contractual expense limitation on net expenses and does not apply to the contractual investment advisory fee waiver described above or any voluntary waivers that may be in effect from time to time.

On March 31, 2019, the fund level and class specific waivers and/or reimbursements subject to possible future recoupment under the expense limitation agreement are as follows:

	Expiring September 30,
	2019		2020		2021
Fund level	$	5,695	$	—	$	—
Institutional		68,322		67,144		—
Service		956		432		—
Investor A		753		—		—

Securities Lending: The U.S. Securities and Exchange Commission (“SEC”) has issued an exemptive order which permits BlackRock Investment Management, LLC (“BIM”), an affiliate of the Manager, to serve as securities lending agent for the Fund, subject to applicable conditions. As securities lending agent, BIM bears all operational costs directly related to securities lending. The Fund is responsible for expenses in connection with the investment of cash collateral received for securities on loan (the “collateral investment expenses”). The cash collateral is invested in a private investment company managed by the Manager or its affiliates. However, BIM has agreed to cap the collateral investment expenses of the private investment company to an annual rate of 0.04%. The investment adviser to the private investment company will not charge any advisory fees with respect to shares purchased by the Fund. The private investment company in which the cash collateral has been invested may, under certain circumstances, impose a liquidity fee of up to 2% of the value withdrawn or temporarily restrict withdrawals for up to 10 business days during a 90 day period, in the event that the private investment company’s weekly liquid assets fall below certain thresholds.

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

Pursuant to the current securities lending agreement, the Fund retains 82% of securities lending income (which excludes collateral investment expenses), and this amount retained can never be less than 70% of the total of securities lending income plus the collateral investment expenses.

38 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements  (continued)

In addition, commencing the business day following the date that the aggregate securities lending income earned across the Multi-Asset Complex in a calendar year exceeds a specified threshold, the Fund, pursuant to the securities lending agreement, will retain for the remainder of that calendar year securities lending income in an amount equal to 85% of securities lending income, and this amount retained can never be less than 70% of the total of securities lending income plus the collateral investment expenses.

Prior to January 1, 2019, the Fund was subject to a different securities lending fee arrangement.

The share of securities lending income earned by the Fund is shown as securities lending income — affiliated — net in the Statement of Operations. For the six months ended March 31, 2019, the Fund paid BIM $6,360 for securities lending agent services.

Interfund Lending: In accordance with an exemptive order (the “Order”) from the SEC, the Fund may participate in a joint lending and borrowing facility for temporary purposes (the “Interfund Lending Program”), subject to compliance with the terms and conditions of the Order, and to the extent permitted by the Fund’s investment policies and restrictions. The Fund is currently permitted to borrow under the Interfund Lending Program.

A lending BlackRock fund may lend in aggregate up to 15% of its net assets, but may not lend more than 5% of its net assets to any one borrowing fund through the Interfund Lending Program. A borrowing BlackRock fund may not borrow through the Interfund Lending Program or from any other source more than 33 1/3% of its total assets (or any lower threshold provided for by the fund’s investment restrictions). If a borrowing BlackRock fund’s total outstanding borrowings exceed 10% of its total assets, each of its outstanding interfund loans will be subject to collateralization of at least 102% of the outstanding principal value of the loan. All interfund loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the highest current overnight repurchase agreement rate available to a lending fund and the bank loan rate, as calculated according to a formula established by the Board.

During the six months ended March 31, 2019, the Fund did not participate in the Interfund Lending Program.

Trustees and Officers: Certain trustees and/or officers of the Trusts are trustees and/or officers of BlackRock or its affiliates. The Fund reimburses the Manager for a portion of the compensation paid to the Fund’s Chief Compliance Officer, which is included in Trustees and Officer in the Statement of Operations.

7. PURCHASES AND SALES

For the six months ended March 31, 2019, purchases and sales of investments, including paydowns and excluding short-term securities, were as follows:

	Purchases		Sales
Non-U.S Government Securities	$	651,980,553	$	626,562,344
U.S Government Securities		61,492,749		45,156,863

8. INCOME TAX INFORMATION

It is the Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.

The Fund files U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on the Fund’s U.S. federal tax returns generally remains open for each of the four years ended September 30, 2018. The statutes of limitations on the Fund’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.

Management has analyzed tax laws and regulations and their application to the Fund as of March 31, 2019, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Fund’s financial statements.

As of September 30, 2018, the Fund had a capital loss carryforward with no expiration date available to offset future realized capital gains in the amount of $3,234,286.

As of March 31, 2019, gross unrealized appreciation and gross unrealized depreciation based on cost for U.S. federal income tax purposes were as follows:

Tax cost	$	604,939,568
Gross unrealized appreciation		52,769,153
Gross unrealized depreciation		(40,661,469	)
Net unrealized appreciation	$	12,107,684

9. BANK BORROWINGS

The Trust, on behalf of the Fund, along with certain other funds managed by the Manager and its affiliates (“Participating Funds”), is a party to a364-day, $2.25 billion credit agreement with a group of lenders. Under this agreement, the Fund may borrow to fund shareholder redemptions. Excluding commitments designated for certain individual funds, the Participating Funds, including the Fund, can borrow up to an aggregate commitment amount of $1.75 billion at any time outstanding, subject to asset coverage and other limitations as specified in the agreement. The credit agreement has the following terms: a fee of 0.10% per annum on unused commitment amounts and interest at a rate equal to the higher of(a) one-month LIBOR (but, in any event, not less than 0.00%) on the date the loan is made plus 0.80% per annum or (b) the Fed Funds rate (but, in any event, not less than 0.00%) in effect from time to time plus 0.80% per annum on amounts borrowed. The agreement expires in April 2019 unless extended or renewed. Participating Funds paid an upfront commitment fee of 0.02% on the total commitment amounts, in addition to administration, legal and

NOTESTO FINANCIAL STATEMENTS 39

Notes to Financial Statements  (continued)

arrangement fees, which are included in miscellaneous expenses in the Statement of Operations. These fees were allocated among such funds based upon portions of the aggregate commitment available to them and relative net assets of Participating Funds. During the six months ended March 31, 2019, the Fund did not borrow under the credit agreement.

10. PRINCIPAL RISKS

In the normal course of business, the Fund invests in securities or other instruments and may enter into certain transactions, and such activities subject the Fund to various risks, including among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate and price fluctuations. The Fund’s prospectus provides details of the risks to which the Fund is subject.

The Fund may be exposed to prepayment risk, which is the risk that borrowers may exercise their option to prepay principal earlier than scheduled during periods of declining interest rates, which would force the Fund to reinvest in lower yielding securities. The Fund may also be exposed to reinvestment risk, which is the risk that income from the Fund’s portfolio will decline if the Fund invests the proceeds from matured, traded or called fixed-income securities at market interest rates that are below the Fund portfolio’s current earnings rate.

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

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

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

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

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

The Fund’s risk of loss from counterparty credit risk on OTC derivatives is generally limited to the aggregate unrealized gain less the value of any collateral held by the Fund.

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

Concentration Risk: The Fund invests a significant portion of its assets in fixed-income securities and/or uses derivatives tied to the fixed-income markets. Changes in market interest rates or economic conditions may affect the value and/or liquidity of such investments. Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates fall and decrease as interest rates rise. The Funds may be subject to a greater risk of rising interest rates due to the current period of historically low rates. The Federal Reserve has begun to raise the Federal Funds rate, and each increase results in more pronounced interest rate risk in the current market environment.

40 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements  (continued)

11. CAPITAL SHARE TRANSACTIONS

Transactions in capital shares for each class were as follows:

	Six Months Ended 03/31/2019						Year Ended 09/30/2018
	Shares			Amount			Shares			Amount
Institutional
Shares sold		4,854,063		$	68,150,796			5,930,824		$	88,216,243
Shares issued in reinvestment of distributions		1,138,641			15,531,063			92,039			1,335,481
Shares redeemed		(3,540,171	)		(51,666,566	)		(5,140,817	)		(75,765,159	)
Net increase		2,452,533		$	32,015,293			882,046		$	13,786,565
Service
Shares sold		52,628		$	739,605			18,095		$	269,652
Shares issued in reinvestment of distributions		6,087			82,536			440			6,344
Shares redeemed		(26,403	)		(371,172	)		(23,333	)		(346,421	)
Net increase (decrease)		32,312		$	450,969			(4,798	)	$	(70,425	)
Investor A
Shares sold		1,665,335		$	24,481,465			709,861		$	10,660,951
Shares issued from conversion		—			—			6,266			89,795
Shares issued in reinvestment of distributions		1,562,094			21,150,762			129,036			1,860,696
Shares redeemed		(1,482,783	)		(21,125,062	)		(2,741,294	)		(40,278,089	)
Net increase (decrease)		1,744,646		$	24,507,165			(1,896,131	)	$	(27,666,647	)
Investor B(a)
Shares sold		—		$	—			4		$	85
Shares issued in reinvestment of distributions		—			—			35			501
Shares converted		—			—			(6,323	)		(89,795	)
Shares redeemed		—			—			(273	)		(4,268	)
Net decrease		—		$	—			(6,557	)	$	(93,477	)
Investor C
Shares sold		271,180		$	3,742,000			123,519		$	1,770,365
Shares issued in reinvestment of distributions		121,717			1,607,882			15,240			213,665
Shares redeemed		(1,019,262	)		(14,669,468	)		(635,379	)		(9,044,183	)
Net decrease		(626,365	)	$	(9,319,586	)		(496,620	)	$	(7,060,153	)
Class K
Shares sold		11,851,145		$	164,197,880			3,577,635		$	51,399,050
Shares issued in reinvestment of distributions		1,316,988			17,911,034			118,907			1,721,775
Shares redeemed		(436,563	)		(6,359,353	)		(631,695	)		(9,438,476	)
Net increase		12,731,570		$	175,749,561			3,064,847		$	43,682,349
Total Net Increase		16,334,696		$	223,403,402			1,542,787		$	22,578,212

^(a)  On December 27, 2017, all the issued and outstanding Investor B Shares of the Fund were converted to Investor A Shares of the Fund.

12. REGULATIONS-X AMENDMENTS

On August 17, 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act ReleaseNo. 33-10532, Disclosure Update and Simplification. The Fund has adopted the amendments pertinent to RegulationS-X in this shareholder report. The amendments impacted certain disclosure presentation on the Statement of Assets and Liabilities, Statements of Changes in Net Assets and Notes to the Financial Statements.

Prior year distribution information and undistributed net investment income in the Statements of Changes in Net Assets has been modified to conform to the current year presentation in accordance with the RegulationS-X changes.

NOTESTO FINANCIAL STATEMENTS 41

Notes to Financial Statements  (continued)

Distributions for the year ended September 30, 2018 were classified as follows:

Share Class	Net Investment Income			Net Realized Gain		Return of Capital
Institutional	$	(1,569,603	)	$	—	$	—
Service		(6,689	)		—		—
Investor A		(1,907,243	)		—		—
Investor B(a)		(503	)		—		—
Investor C		(218,265	)		—		—
Class K		(1,723,712	)		—		—

^(a)  On December 27, 2017, all the issued and outstanding Investor B Shares of the Fund were converted to Investor A Shares of the Fund.

Undistributed net investment income as of September 30, 2018 was $21,204,959.

13. SUBSEQUENT EVENTS

Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were issued and the following items were noted:

Effective April 18, 2019, the credit agreement was extended until April 2020 under the same terms.

42 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Trustee and Officer Information

Mark Stalnecker, Chair of the Board and Trustee

Bruce R. Bond, Trustee

Susan J. Carter, Trustee

Collette Chilton, Trustee

Neil A. Cotty, Trustee

Lena G. Goldberg, Trustee

Robert M. Hernandez, Trustee

Henry R. Keizer, Trustee

Cynthia A. Montgomery, Trustee

Donald C. Opatrny, Trustee

Joseph P. Platt, Trustee

Kenneth L. Urish, Trustee

Claire A. Walton, Trustee

Robert Fairbairn, Trustee

John M. Perlowski, Trustee, President and Chief Executive Officer

Thomas Callahan, Vice President

Jennifer McGovern, Vice President

Neal J. Andrews, Chief Financial Officer

Jay M. Fife, Treasurer

Charles Park, Chief Compliance Officer

John MacKessy, Anti-Money Laundering Compliance Officer

Benjamin Archibald, Secretary

At a special meeting of shareholders held on November 21, 2018, the Fund’s shareholders elected Trustees who took office on January 1, 2019. The newly elected Trustees include ten former Trustees and five individuals who served as directors/trustees of the funds in the BlackRock Equity-Bond Complex. Information regarding the individuals who began serving as Trustees effective January 1, 2019 can be found in the proxy statement for the special meeting of shareholders, which is available on the SEC’s EDGAR Database at http://www.sec.gov.

Investment Adviser and Administrator

BlackRock Advisors, LLC

Wilmington, DE 19809

Sub-Advisers

BlackRock Asset Management North Asia Limited

Hong Kong

BlackRock (Singapore) Limited

079912 Singapore

Accounting Agent

JPMorgan Chase Bank, N.A.

New York, NY 10179

Transfer Agent

BNY Mellon Investment Servicing (US) Inc.

Wilmington, DE 19809

Custodian

JPMorgan Chase Bank, N.A.

New York, NY 10179

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Boston, MA 02116

Distributor

BlackRock Investments, LLC

New York, NY 10022

Legal Counsel

Sidley Austin LLP

New York, NY 10019

Address of the Trust

100 Bellevue Parkway

Wilmington, DE 19809

TRUSTEEAND OFFICER INFORMATION 43

Additional Information

Proxy Results

A Special Meeting of Shareholders was held on November 21, 2018 for shareholders of record on September 24, 2018, to elect a Board of Trustees of the Trust. The newly elected Trustees took office effective January 1, 2019.

Shareholders approved the Trustees* of BlackRock Funds^SM with voting results as follows:

	Votes For		Votes Withheld
Bruce R. Bond		1,194,453,855		13,902,348
Susan J. Carter		1,196,552,121		11,804,082
Collette Chilton		1,196,528,363		11,827,840
Neil A. Cotty		1,196,166,120		12,190,083
Robert Fairbairn		1,193,957,290		14,398,913
Lena G. Goldberg		1,196,028,565		12,327,638
Robert M. Hernandez		1,194,378,100		13,978,103
Henry R. Keizer		1,195,228,758		13,127,445
Cynthia A. Montgomery		1,196,372,720		11,983,483
Donald C. Opatrny		1,195,869,847		12,486,356
John M. Perlowski		1,193,999,184		14,357,019
Joseph P. Platt		1,195,764,828		12,591,375
Mark Stalnecker		1,195,994,960		12,361,243
Kenneth L. Urish		1,195,716,210		12,639,993
Claire A. Walton		1,196,904,200		11,452,003

* Denotes Trust-wide proposal and voting results.

The above Trustees, referred to as the BlackRock Multi-Asset Board, have also been elected to serve as directors/trustees for other BlackRock-advised equity, multi-asset, index and money market funds.

General Information

Householding

The Fund will mail only one copy of shareholder documents, including prospectuses, annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call the Fund at (800)441-7762.

Availability of Quarterly Schedule of Investments

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on FormN-Q. The Fund’s FormN-Q is available on the SEC’s website at http://www.sec.gov. The Fund’s FormsN-Q may also be obtained upon request and without charge by calling (800)441-7762.

Availability of Proxy Voting Policies and Procedures

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available upon request and without charge (1) by calling (800)441-7762; (2) athttp://www.blackrock.com; and (3) on the SEC’s website at http://www.sec.gov.

Availability of Proxy Voting Record    

Information about how the Fund voted proxies relating to securities held in the Fund’s portfolios during the most recent12-month period ended June 30 is available upon request and without charge (1) athttp://www.blackrock.com; or by calling (800)441-7762 and (2) on the SEC’s website at http://www.sec.gov.

BlackRock’s Mutual Fund Family

BlackRock offers a diverse lineup ofopen-end mutual funds crossing all investment styles and managed by experts in equity, fixed-income andtax-exempt investing. Visithttp://www.blackrock.com for more information.

44 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

Additional Information  (continued)

Shareholder Privileges

Account Information

Call us at (800)441-7762 from 8:00 AM to 6:00 PM ET on any business day to get information about your account balances, recent transactions and share prices. You can also reach us on the Web athttp://www.blackrock.com.

Automatic Investment Plans

Investor Class shareholders who want to invest regularly can arrange to have $50 or more automatically deducted from their checking or savings account and invested in any of the BlackRock funds.

Systematic Withdrawal Plans

Investor Class shareholders can establish a systematic withdrawal plan and receive periodic payments of $50 or more from their BlackRock funds, as long as their account balance is at least $10,000.

Retirement Plans

Shareholders may make investments in conjunction with Traditional, Rollover, Roth, Coverdell, Simple IRAs, SEP IRAs and 403(b) Plans.

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding theirnon-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personalnon-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose tonon-affiliated third parties anynon-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. Thesenon-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access tonon-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect thenon-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

ADDITIONAL INFORMATION 45

Glossary of Terms Used in this Report

Currency
AUD	Australian Dollar
BRL	Brazilian Real
CAD	Canadian Dollar
CHF	Swiss Franc
CNY	Chinese Yuan
CZK	Czech Koruna
EUR	Euro
GBP	British Pound
HKD	Hong Kong Dollar
INR	Indian Rupee
JPY	Japanese Yen
KRW	South Korean Won
MXN	Mexican Peso
MYR	Malaysian Ringgit
NOK	Norwegian Krone
NZD	New Zealand Dollar
PLN	Polish Zloty
SEK	Swedish Krona
SGD	Singapore Dollar
THB	Thai Baht
TWD	New Taiwan Dollar
USD	United States Dollar
ZAR	South African Rand

Portfolio Abbreviations
ADR	American Depositary Receipt
BA	Canadian Bankers Acceptances
BBR	Australian Bank Bill Rate
BZDIOVER	Overnight Brazil CETIP — Interbank Rate
CAC	Cotation Assistée en Continu (French Stock Exchange)
CD_KSDA	Certificates of Deposit by the Korean Securities Dealers Association
CDO	Collateralized Debt Obligation
CNREPOFI	7 Day China Fixing Repo Rates
CVA	Certification Van Aandelon (Dutch Certificate)
DAX	Deutscher Aktien Index
EURIBOR	Euro Interbank Offered Rate
HIBOR	Hong Kong Interbank Offered Rate
JIBAR	Johannesburg Interbank Average Rate
KLIBOR	Kuala Lumpur Interbank Offered Rate
LIBOR	London Interbank Offered Rate
MIB	Milano Italia Borsa
MIBOR	Moscow Interbank Offered Rate
MXIBTIIE	Mexico Interbank TIIE28-Day
OMX	Stockholm Nordic Exchange
OTC	Over-The-Counter
REIT	Real Estate Investment Trust
S&P	S&P Global Ratings
SOR	Singapore Interbank Offered Rates
STIBOR	Stockholm Interbank Offered Rate
THBFIX	Thai Baht Interest Rate Fixing
TOPIX	Tokyo Stock Price Index
TWCPBA	Taiwan Secondary Markets Bills Rate
WIBOR	Warsaw Interbank Offered Rate

46 2019 BLACKROCK SEMI-ANNUAL REPORTTO SHAREHOLDERS

This report is intended for current holders. It is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Fund unless preceded or accompanied by the Fund’s current prospectus. Past performance results shown in this report should not be considered a representation of future performance. Investment returns and principal value of shares will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Statements and other information herein are as dated and are subject to change.

TO-3/19-SAR

Item 2 –	Code of Ethics – Not Applicable to this semi-annual report
Item 3 –	Audit Committee Financial Expert – Not Applicable to this semi-annual report
Item 4 –	Principal Accountant Fees and Services – Not Applicable to this semi-annual report
Item 5 –	Audit Committee of Listed Registrants – Not Applicable
Item 6 –	Investments
	(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this Form.
	(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous FormN-CSR filing.
Item 7 –	Disclosure of Proxy Voting Policies and Procedures forClosed-End Management Investment Companies – Not Applicable
Item 8 –	Portfolio Managers ofClosed-End Management Investment Companies – Not Applicable
Item 9 –	Purchases of Equity Securities byClosed-End Management Investment Company and Affiliated Purchasers – Not Applicable
Item 10 –	Submission of Matters to a Vote of Security Holders –There have been no material changes to these procedures.
Item 11 –	Controls and Procedures
	(a) The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Securities Exchange Act of 1934, as amended.
	(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of 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 forClosed-End Management Investment Companies – Not Applicable
Item 13 –	Exhibits attached hereto
	(a)(1) – Code of Ethics – Not Applicable to this semi-annual report
	(a)(2) – Certifications – Attached hereto
	(a)(3) – Not Applicable

2

(a)(4) – Not Applicable

(b) – Certifications – Attached hereto

3

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.

BlackRock Funds
By:	/s/ John M. Perlowski
	John M. Perlowski
	Chief Executive Officer (principal executive officer) of
	BlackRock Funds
Date: June 5, 2019

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/ John M. Perlowski
	John M. Perlowski
	Chief Executive Officer (principal executive officer) of
	BlackRock Funds
Date: June 5, 2019

By:	/s/ Neal J. Andrews
	Neal J. Andrews
	Chief Financial Officer (principal financial officer) of
	BlackRock Funds
Date: June 5, 2019

4