UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21759
Name of Fund: BlackRock Global Dynamic Equity Fund
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Robert C. Doll, Jr., Chief Executive
Officer, BlackRock Global Dynamic Equity Fund, 800 Scudders Mill Road,
Plainsboro, NJ 08536. Mailing address: P.O. Box 9011, Princeton, NJ
08543-9011
Registrant's telephone number, including area code: (609) 282-2800
Date of fiscal year end: 10/31/06
Date of reporting period: 11/01/05 - 10/31/06
Item 1 - Report to Stockholders
ALTERNATIVES BLACKROCK SOLUTIONS EQUITIES
FIXED INCOME LIQUIDITY REAL ESTATE
BlackRock Global Dynamic BLACKROCK
Equity Fund
ANNUAL REPORT | OCTOBER 31, 2006
NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE
BlackRock Global Dynamic Equity Fund
Portfolio Information as of October 31, 2006
- --------------------------------------------------------------------------------
Ten Largest Holdings Percent of
(Equity Investments) Net Assets
- --------------------------------------------------------------------------------
General Electric Co. ................................................... 1.3%
Vodafone Group Plc ..................................................... 1.2
American International Group, Inc. ..................................... 1.2
Exxon Mobil Corp. ...................................................... 1.2
Reliance Industries Ltd. ............................................... 1.1
Petroleo Braseleiro SA ................................................. 1.1
Microsoft Corp. ........................................................ 1.1
Millea Holdings, Inc. .................................................. 1.0
Mitsui Sumitomo Insurance Co., Ltd. .................................... 0.9
Royal Dutch Shell Plc Class B .......................................... 0.9
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Five Largest Industries Percent of
(Equity Investments) Net Assets
- --------------------------------------------------------------------------------
Insurance .............................................................. 9.6%
Oil, Gas & Consumable Fuels ............................................ 9.2
Commercial Banks ....................................................... 8.6
Industrial Conglomerates ............................................... 4.1
Pharmaceuticals ........................................................ 3.9
- --------------------------------------------------------------------------------
For Fund compliance purposes, the Fund's industry classifications refer to
any one or more of the industry sub-classifications used by one or more
widely recognized market indexes or ratings group indexes, and/or as
defined by Fund management. This definition may not apply for purposes of
this report, which may combine industry sub-classifications for reporting
ease. These industry classifications are unaudited.
- --------------------------------------------------------------------------------
Breakdown of Equity & Fixed Income Percent of
Securities By Country Net Assets +
- --------------------------------------------------------------------------------
United States ........................................................ 40.4%*
Japan ................................................................ 15.8
United Kingdom ....................................................... 7.5
France ............................................................... 3.9
South Korea .......................................................... 3.9
India ................................................................ 3.5
Germany .............................................................. 3.5
Brazil ............................................................... 2.5
China ................................................................ 2.4
Singapore ............................................................ 2.0
Italy ................................................................ 1.8
Switzerland .......................................................... 1.6
Australia ............................................................ 1.5
Hong Kong ............................................................ 1.4
Taiwan ............................................................... 1.4
Canada ............................................................... 1.1
Sweden ............................................................... 1.0
Malaysia ............................................................. 0.9
Thailand ............................................................. 0.8
Netherlands .......................................................... 0.8
Mexico ............................................................... 0.6
Finland .............................................................. 0.5
Vietnam .............................................................. 0.5
Ireland .............................................................. 0.4
Norway ............................................................... 0.4
Spain ................................................................ 0.4
Hungary .............................................................. 0.2
Israel ............................................................... 0.2
Belgium .............................................................. 0.2
South Africa ......................................................... 0.2
New Zealand .......................................................... 0.1
Peru ................................................................. 0.1
Chile ................................................................ 0.0**
Austria .............................................................. 0.0**
- --------------------------------------------------------------------------------
* Includes investments in short-term securities.
** Holdings are less than 0.1%.
+ Total may not equal 100%.
2 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
A Letter to Shareholders
Dear Shareholder
Ten months into 2006, we are able to say it has been an interesting year for
investors. After a volatile start and far-reaching mid-year correction, the
financial markets regained some positive momentum through late summer and fall.
For the six- and 12-month periods ended October 31, 2006, most major market
indexes managed to post positive returns:
Total Returns as of October 31, 2006 6-month 12-month
========================================================================================
U.S. equities (Standard & Poor's 500 Index) +6.11% +16.34%
- ----------------------------------------------------------------------------------------
Small cap U.S. equities (Russell 2000 Index) +0.90 +19.98
- ----------------------------------------------------------------------------------------
International equities (MSCI Europe, Australasia, Far East Index) +3.77 +27.52
- ----------------------------------------------------------------------------------------
Fixed income (Lehman Brothers Aggregate Bond Index) +4.60 + 5.19
- ----------------------------------------------------------------------------------------
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index) +4.12 + 5.75
- ----------------------------------------------------------------------------------------
High yield bonds (Credit Suisse High Yield Index) +4.66 +10.29
- ----------------------------------------------------------------------------------------
The Federal Reserve Board (the Fed), after raising the target short-term
interest rate 17 times between June 2004 and June 2006, finally opted to pause
on August 8, 2006. This left the federal funds rate at 5.25%, where it remained
through the September and October Fed meetings. In interrupting its two-year
rate-hiking campaign, the Fed acknowledged that economic growth is slowing, led
by softness in the housing market. However, the central bankers continue to take
a cautionary position on inflation, despite a decline in energy prices in recent
months. At the time of this writing, the price of oil had settled into the
$60-per-barrel range after reaching nearly $78 per barrel earlier in the year.
Notwithstanding the mid-year correction, equity markets generally found support
in solid corporate earnings reports in the first three quarters of the year.
Overall corporate health, including strong company balance sheets, helped to
sustain robust dividend-distribution, share-buyback and merger-and-acquisition
activity. Many international equity markets fared equally well or better, thanks
in part to higher economic growth rates and low inflation.
In the U.S. bond market, prices declined for much of the year as investors
focused on decent economic activity and inflation concerns. Bond prices began to
improve in late June as the economy showed signs of weakening and inflation
pressures subsided. Notably, the Treasury curve inverted periodically, a
phenomenon typically associated with periods of economic weakness. At the end of
October, the one-month Treasury bill offered the highest yield on the curve at
5.18%, while the 30-year Treasury bond had a yield of 4.72%.
Amid the uncertainty inherent in the financial markets, we encourage you to
review your goals periodically with your financial professional and to make
portfolio changes, as needed. For additional insight and timely "food for
thought" for investors, we also invite you to visit Shareholder magazine at
www.blackrock.com/shareholdermagazine. We are pleased to make our
investor-friendly magazine available to you online. We thank you for trusting
BlackRock with your investment assets, and we look forward to continuing to
serve your investment needs.
Sincerely,
/s/ Robert C. Doll, Jr.
Robert C. Doll, Jr.
President and Trustee
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 3
A Discussion With Your Fund's Portfolio Managers
The Fund provided solid returns for the fiscal period, corresponding to
strong performance in most developed markets, and benefited from an overweight
position in Asian equities and favorable stock selection in the U.S.
How has the Fund performed since its inception in light of the existing market
conditions?
From inception on November 4, 2005, through October 31, 2006, BlackRock Global
Dynamic Equity Fund's (formerly Merrill Lynch Global Equity Opportunities Fund)
Institutional, Investor A, Investor B and Investor C Shares had total returns of
+20.51%, +20.21%, +19.31% and +19.41%, respectively. (Fund results shown do not
reflect sales charges and would be lower if sales charges were included.
Complete performance information can be found on pages 6 and 7 of this report to
shareholders.) Fund results compared favorably with the +19.96% return of its
Reference Portfolio, which comprises 60% U.S. equities and 40% non-U.S.
equities, as represented by the Standard & Poor's 500 (S&P 500) Index and the
Financial Times Stock Exchange (FTSE) World Index (ex-U.S.), respectively.
Returns for each component of the Reference Portfolio for the period from
November 4, 2005, through October 31, 2006, were +15.03% for the S&P 500 Index
and +27.50% for the FTSE World Index (ex-U.S.).
For the same period, the Fund's broad market benchmark, the FTSE World Index,
returned +21.24%, and its comparable Lipper category of Global Multi-Cap Growth
Funds posted an average return of +18.11%. (As defined by Lipper, funds in this
Lipper category invest in a variety of market capitalization ranges without
concentrating 75% of their equity assets in any one range over an extended
period of time.)
While U.S. stocks, as measured by the S&P 500 Index, returned +15.03% for the
period, the MSCI Europe Index and the MSCI Pacific Index gained 28.85% and
17.52%, respectively, in U.S. dollar terms. The Federal Reserve Board's (the
Fed) decision to pause its monetary tightening campaign, along with double-digit
corporate earnings growth that largely surprised investors, helped push U.S.
stocks higher during the period. European equities rose even more dramatically,
propelled by stronger-than-expected company fundamentals, improved business and
consumer sentiment (particularly in Germany and France), as well as a record
pace of merger-and-acquisition activity. This helped ratchet up various country
indexes, such as Spain's IBEX 35, which surged 44.12% for the period. Notably,
the euro strengthened 6.9% versus the U.S. dollar during the period, further
improving the returns for European assets.
In the Pacific region, strong earnings growth and benign regional central bank
policy proved a favorable combination for equities. India's Sensex Index
remained one of the world's leading equity markets, advancing 61.20% for the
period. Other strong performers were Indonesia (+68.10%), Singapore (+38.81%)
and Australia (+32.29%). Nearly all major Pacific Basin currencies appreciated
against the U.S. dollar during the period, with the exception of the New Zealand
dollar (down 2.69%). Importantly, Japan's Nikkei, which posted a +19.13% return,
was a laggard relative to most other Asia-Pacific equity markets. Although the
Japanese equity market benefited from positive investor sentiment that was
characteristic of the period, concerns about the Japanese manufacturing sector
and the country's export prospects have weighed on returns recently.
What factors most influenced Fund performance during the period?
The Fund's positive results corresponded to impressive performance in many of
the world's developed equity markets. Relative to the Reference Portfolio, a
significant overweight to Asian equities, especially in India and Singapore, and
effective stock selection in the United States helped drive returns. Successful
security selection in the energy, industrials and information technology sectors
also boosted performance as oil prices continued their ascent. Moreover, growth
in Asia, notably in China, continued to fuel demand for raw materials
(particularly energy resources) and capital investment in energy-related
production.
4 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Detracting modestly from the Fund's relative performance was its underweight
position in European equities, particularly in Spain, as these markets
appreciated significantly over the 12 months.
What changes were made to the portfolio during the period?
We trimmed the Fund's U.S. equity exposure from 42% of net assets to 36% and
increased exposure to European and Brazilian equities by 5% and 1.5%,
respectively. We believe corporate earnings growth rates in the United States
will slow and the sustainability of consumer spending will abate.
Overall, our strategy has included reducing the cyclicality of the portfolio and
taking profits in stocks that appreciated significantly, notably in the
strong-performing materials and energy sectors.
How would you characterize the Fund's position at the close of the period?
At October 31, 2006, the Fund was significantly underweight versus the Reference
Portfolio in the United States, relatively neutral in Europe, and overweight in
Asia. From a sector perspective, the Fund ended the period overweight in
telecommunications, energy, industrials and materials; underweight in consumer
discretionary, technology, health care, consumer staples and financials; and
with a relatively neutral position in utilities.
With respect to currency exposure, the Fund closed the fiscal year with an
underweighting in the U.S. dollar and the euro, a relatively neutral stance on
the Japanese yen, and slight overweight positions in the Brazilian real and
several Asian currencies.
The Fund currently is diversified across 35 countries worldwide and has the
flexibility to invest across all industry sectors, market capitalizations and
equity-like securities, which include convertibles and preferred securities. The
Fund employs a total return approach as opposed to one that is benchmark driven.
As we start a new year, we continue to seek the greatest opportunities that the
world's equity markets have to offer, targeting companies that we believe have
attractive valuations and superior long-term growth prospects.
Dennis Stattman
Vice President and Senior Portfolio Manager
Dan Chamby
Vice President and Associate Portfolio Manager
November 22, 2006
- --------------------------------------------------------------------------------
Effective October 2, 2006, the Fund's Class A, Class B, Class C and Class I
Shares were redesignated Investor A, Investor B, Investor C and Institutional
Shares, respectively.
- --------------------------------------------------------------------------------
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 5
Performance Data
About Fund Performance
Effective October 2, 2006, the Fund's Class A, Class B, Class C and Class I
Shares were redesignated Investor A, Investor B, Investor C and Institutional
Shares, respectively. As previously communicated to shareholders, new sales
charge schedules came into effect at the same time for certain of these classes.
The Fund has multiple classes of shares:
o Institutional Shares are no longer subject to any front-end sales charge.
Institutional Shares bear no ongoing distribution or service fees and are
available only to eligible investors.
o Investor A Shares incur a maximum initial sales charge (front-end load) of
5.25% and a service fee of 0.25% per year (but no distribution fee).
o Investor B Shares are subject to a maximum contingent deferred sales
charge of 4.50% declining to 0% after six years. In addition, Investor B
Shares are subject to a distribution fee of 0.75% per year and a service
fee of 0.25% per year. These shares automatically convert to Investor A
Shares after approximately eight years. (There is no initial sales charge
for automatic share conversions.) All returns for periods greater than
eight years reflect this conversion.
o Investor C Shares are subject to a distribution fee of 0.75% per year and
a service fee of 0.25% per year. In addition, Investor C Shares are
subject to a 1% contingent deferred sales charge if redeemed within one
year of purchase.
None of the past results shown should be considered a representation of future
performance. Current performance may be lower or higher than the performance
data quoted. Refer to www.blackrock.com to obtain performance data current to
the most recent month-end. Performance results do not reflect the deduction of
taxes that a shareholder would pay on fund distributions or the redemption of
fund shares. The Fund may charge a 2% redemption fee for sales or exchanges of
shares within 30 days of purchase or exchange. Performance data does not reflect
this potential fee. Figures shown in each of the following tables assume
reinvestment of all dividends and capital gain distributions, if any, at net
asset value on the ex-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. Dividends 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.
Recent Performance Results
6-Month Since Inception
As of October 31, 2006 Total Return Total Return
================================================================================
Institutional Shares* +2.47% +20.51%
- --------------------------------------------------------------------------------
Investor A Shares* +2.39 +20.21
- --------------------------------------------------------------------------------
Investor B Shares* +1.97 +19.31
- --------------------------------------------------------------------------------
Investor C Shares* +2.05 +19.41
- --------------------------------------------------------------------------------
FTSE World Index** +4.74 +21.24
- --------------------------------------------------------------------------------
FTSE World Index (Ex-U.S.)*** +3.54 +27.50
- --------------------------------------------------------------------------------
S&P 500(R) Index**** +6.11 +15.03
- --------------------------------------------------------------------------------
Reference Portfolio***** +5.09 +19.96
- --------------------------------------------------------------------------------
* Investment results shown do not reflect sales charges; results shown would
be lower if a sales charge was included. Cumulative total investment
returns are based on changes in net asset values for the periods shown,
and assume reinvestment of all dividends and capital gains distributions
at net asset value on the ex-dividend date. The Fund's inception date is
11/04/05.
** This unmanaged broad-based capitalization-weighted Index is comprised of
2,200 equities from 24 countries in 12 regions, including the United
States. Since inception total return is from 11/04/05.
*** This unmanaged capitalization-weighted Index is comprised of 1,631
companies in 28 countries, excluding the United States. Since inception
total return is from 11/04/05.
**** This unmanaged Index covers 500 industrial, utility, transportation and
financial companies of the U.S. markets (mostly NYSE issues) representing
about 75% of NYSE market capitalization and 30% of NYSE issues. Since
inception total return is from 11/04/05.
***** The Reference Portfolio is an unmanaged index comprised of 60% of the S&P
500 Index and 40% of the FTSE World Index (Ex-U.S.). Since inception total
return is from 11/04/05.
S&P 500 is a registered trademark of the McGraw-Hill Companies.
6 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Performance Data (concluded)
Total Return Based on a $10,000 Investment
A line graph depicting the growth of an investment in the Fund's Institutional,
Investor A, Investor B & Investor C Shares compared to growth of an investment
in the FTSE World Index, S&P 500 Index, the FTSE World Index (ex-U.S) and the
Reference Portfolio. Values are from November 4, 2005 to October 2006:
FTSE World
Institutional Investor A Investor B Investor C FTSE World S&P 500 Index Reference
Shares*+ Shares*+ Shares*+ Shares*+ Index++ Index+++ (Ex-U.S.)++++ Portfolio@
11/04/05** $10,000 $ 9,475 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
10/06 $12,051 $11,390 $11,481 $11,841 $12,124 $11,503 $12,750 $11,996
* Assuming maximum sales charge, if any, transaction costs and other
operating expenses, including advisory fees.
** Commencement of operations.
+ The Fund invests primarily in the securities of corporate issuers located
in North and South America, Europe, Australia and the Far East.
++ This unmanaged capitalization-weighted Index is comprised of 2,200
equities from 24 countries in 12 regions, including the United States.
+++ This unmanaged Index covers 500 industrial, utility, transportation and
financial companies of the U.S. markets (mostly NYSE issues) representing
about 75% of NYSE market capitalization and 30% of NYSE issues.
++++ This unmanaged capitalization-weighted Index is comprised of 1,631
companies in 28 countries, excluding the United States.
@ The Reference Portfolio is an unmanaged weighted Index comprised 60% of
the S&P 500 Index and 40% of the FTSE World Index (Ex-U.S.).
Past performance is not Indicative of future results.
Aggregate Total Return
- --------------------------------------------------------------------------------
Return
================================================================================
Institutional Shares
================================================================================
Inception (11/04/05)
to 10/31/06 +20.51%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Return Without Return With
Sales Charge Sales Charge*
================================================================================
Investor A Shares
================================================================================
Inception (11/04/05)
to 10/31/06 +20.21% +13.90%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Return Return
Without CDSC With CDSC+++
================================================================================
Investor B Shares+
================================================================================
Inception (11/04/05)
to 10/31/06 +19.31% +14.81%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Return Return
Without CDSC With CDSC+++
================================================================================
Investor C Shares++
================================================================================
Inception (11/04/05)
to 10/31/06 +19.41% +18.41%
- --------------------------------------------------------------------------------
* Assuming maximum sales charge of 5.25%.
+ Maximum contingent deferred sales charge is 4.50% and is reduced to 0%
after six years.
++ Maximum contingent deferred sales charge is 1% and is reduced to 0% after
one year.
+++ Assuming payment of applicable contingent deferred sales charge.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 7
Disclosure of Expenses
Shareholders of this Fund may incur the following charges: (a) expenses related
to transactions, including sales charges, redemption fees and exchange fees; and
(b) operating expenses, including advisory fees, distribution fees including
12b-1 fees, and other Fund expenses. The following example (which is based on a
hypothetical investment of $1,000 invested on May 1, 2006 and held through
October 31, 2006) 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 first table below 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 in the first line under the
heading entitled "Expenses Paid During the Period."
The second table below 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 this Fund and
other funds, compare the 5% hypothetical example with the 5% hypothetical
examples that appear in other funds' shareholder reports.
The expenses shown in the table are intended to highlight shareholders' ongoing
costs only and do not reflect any transactional expenses, such as sales charges,
redemption fees or exchange fees. Therefore, the second table 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.
Expenses Paid
Beginning Ending During the Period*
Account Value Account Value May 1, 2006 to
May 1, 2006 October 31, 2006 October 31, 2006
============================================================================================================================
Actual
============================================================================================================================
Institutional $1,000 $1,024.70 $ 6.45
- ----------------------------------------------------------------------------------------------------------------------------
Investor A $1,000 $1,023.90 $ 7.74
- ----------------------------------------------------------------------------------------------------------------------------
Investor B $1,000 $1,019.70 $11.63
- ----------------------------------------------------------------------------------------------------------------------------
Investor C $1,000 $1,020.50 $11.69
============================================================================================================================
Hypothetical (5% annual return before expenses)**
============================================================================================================================
Institutional $1,000 $1,019.13 $ 6.43
- ----------------------------------------------------------------------------------------------------------------------------
Investor A $1,000 $1,017.86 $ 7.71
- ----------------------------------------------------------------------------------------------------------------------------
Investor B $1,000 $1,013.98 $11.60
- ----------------------------------------------------------------------------------------------------------------------------
Investor C $1,000 $1,013.93 $11.65
- ----------------------------------------------------------------------------------------------------------------------------
* For each class of the Fund, expenses are equal to the annualized expense
ratio for the class (1.25% for Institutional, 1.50% for Investor A, 2.26%
for Investor B and 2.27% for Investor C), multiplied by the average
account value over the period, multiplied by 186/365 (to reflect the
one-half year period shown).
** Hypothetical 5% annual return before expenses is calculated by pro-rating
the number of days in the most recent fiscal half year divided by 365.
Proxy Results
During the six-month period ended October 31, 2006, BlackRock Global Dynamic
Equity Fund's shareholders voted on the following proposals. Proposals 1 and 3
were approved at a special shareholders' meeting on August 15, 2006. A
description of the proposals and number of shares voted were as follows:
- ------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Voted Shares Voted
For Against Abstain
- ------------------------------------------------------------------------------------------------------------------
1. To approve a new investment advisory agreement
with BlackRock Advisors, Inc. 10,740,095 151,940 145,907
- ------------------------------------------------------------------------------------------------------------------
3. To approve a contingent subadvisory agreement
with BlackRock Advisors, Inc. 10,722,748 164,351 150,843
- ------------------------------------------------------------------------------------------------------------------
8 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
Australia--1.5%
Beverages--0.0%
Coca-Cola Amatil Ltd. 19,300 $ 104,017
- ----------------------------------------------------------------------------------------------------
Capital Markets--0.3%
Macquarie Bank Ltd. 14,300 825,505
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.6%
BHP Billiton Ltd. 29,000 612,602
Newcrest Mining Ltd. 13,200 243,780
Rio Tinto Ltd. 9,700 588,876
Zinifex Ltd. 18,300 214,967
------------
1,660,225
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable
Fuels--0.1%
Woodside Petroleum Ltd. 6,200 180,276
- ----------------------------------------------------------------------------------------------------
Paper & Forest Products--0.0%
Great Southern Plantations Ltd. 43,600 94,532
- ----------------------------------------------------------------------------------------------------
Transportation
Infrastructure--0.5%
Macquarie Airports 89,000 221,223
Macquarie Infrastructure Group 261,600 684,684
Sydney Roads Group (a) 214,800 189,616
Transurban Group 58,000 324,266
------------
1,419,789
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Australia 4,284,344
====================================================================================================
Austria--0.0%
Diversified Telecommunication
Services--0.0%
Telekom Austria AG 3,900 97,063
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Austria 97,063
====================================================================================================
Belgium--0.2%
Leisure Equipment &
Products--0.2%
AGFA-Gevaert NV 19,220 484,971
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Belgium 484,971
====================================================================================================
Brazil--2.0%
Chemicals--0.0%
Braskem SA 14,500 102,580
- ----------------------------------------------------------------------------------------------------
Commercial Banks--0.1%
Uniao de Bancos Brasileiros SA (b) 2,300 181,125
- ----------------------------------------------------------------------------------------------------
Construction & Engineering--0.1%
Obrascon Huarte Lain Brasil SA (a) 16,200 209,545
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.0%
Cia Energetica de Minas Gerais (b) 3,900 168,909
- ----------------------------------------------------------------------------------------------------
Food & Staples Retailing--0.0%
Cia Brasileira de Distribuicao Grupo
Pao de Acucar 4,163,000 124,414
- ----------------------------------------------------------------------------------------------------
Food Products--0.1%
Cosan SA Industria e Comercio (a) 13,200 224,982
- ----------------------------------------------------------------------------------------------------
IT Services--0.1%
Datasul (a) 29,400 246,979
- ----------------------------------------------------------------------------------------------------
Leisure Equipment &
Products--0.1%
Localiza Rent A Car SA 7,500 186,668
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.2%
Companhia Vale do Rio Doce
(Preference 'A' Shares) (b) 14,200 308,424
Usinas Siderurgicas de Minas Gerais SA
(Preference 'A' Shares) 8,100 275,358
------------
583,782
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable
Fuels--1.1%
Petroleo Brasileiro SA (b) 13,600 1,101,056
Petroleo Brasileiro SA (b) 22,900 2,032,604
------------
3,133,660
- ----------------------------------------------------------------------------------------------------
Road & Rail--0.1%
All America Latina Logistica SA 37,000 323,091
- ----------------------------------------------------------------------------------------------------
Software--0.0%
Totvs SA (a) 6,100 128,466
- ----------------------------------------------------------------------------------------------------
Water Utilities--0.0%
Companhia de Saneamento de
Minas Gerais 17,000 158,370
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.1%
Vivo Participacoes SA (b) 66,500 232,085
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Brazil 6,004,656
====================================================================================================
Canada--1.1%
Diversified Telecommunication
Services--0.0%
BCE, Inc. 700 19,796
- ----------------------------------------------------------------------------------------------------
Insurance--0.0%
Sun Life Financial, Inc. 300 12,615
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.8%
Alamos Gold, Inc. (a) 56,900 459,071
Barrick Gold Corp. 7,497 232,407
Bema Gold Corp. (a) 241,500 1,036,582
Kinross Gold Corp. (a) 35,700 471,240
------------
2,199,300
- ----------------------------------------------------------------------------------------------------
Road & Rail--0.3%
Canadian Pacific Railway Ltd. 14,500 818,647
Canadian Pacific Railway Ltd. (USD) 3,500 197,715
------------
1,016,362
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Canada 3,248,073
====================================================================================================
Chile--0.0%
Electric Utilities--0.0%
Enersis SA (b) 8,900 122,731
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Chile 122,731
====================================================================================================
China--2.0%
Automobiles--0.0%
Denway Motors Ltd. 161,500 59,806
- ----------------------------------------------------------------------------------------------------
Electrical Equipment--0.1%
Shanghai Electric Group Corp. 398,000 140,220
- ----------------------------------------------------------------------------------------------------
Food Products--0.1%
Chaoda Modern Agriculture Holdings Ltd. 340,000 205,910
- ----------------------------------------------------------------------------------------------------
Industrial Conglomerates--1.0%
Beijing Enterprises Holdings Ltd. 414,100 830,628
Shanghai Industrial Holdings Ltd. 77,700 151,260
Tianjin Development Holdings Ltd. 3,024,700 2,030,157
------------
3,012,045
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 9
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
China (concluded)
Insurance--0.1%
China Life Insurance Co. Ltd. (b) 2,100 $ 177,513
Ping An Insurance Group Co. of China Ltd. 32,200 111,995
------------
289,508
- ----------------------------------------------------------------------------------------------------
Marine--0.0%
Xiamen International Port Co. Ltd. (a) 494,100 114,993
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable
Fuels--0.4%
China Shenhua Energy Co. Ltd. Class H 449,300 790,313
Yanzhou Coal Mining Co. Ltd. 615,000 403,294
------------
1,193,607
- ----------------------------------------------------------------------------------------------------
Road & Rail--0.3%
Guangshen Railway Co. Ltd. 1,613,500 759,323
- ----------------------------------------------------------------------------------------------------
Transportation
Infrastructure--0.0%
Hainan Meilan International
Airport Co., Ltd. (a) 93,400 41,433
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in China 5,816,845
====================================================================================================
Finland--0.5%
Electric Utilities--0.5%
Fortum Oyj 53,757 1,479,242
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Finland 1,479,242
====================================================================================================
France--3.9%
Automobiles--0.8%
Peugeot SA 13,998 804,138
Renault SA 12,072 1,412,106
------------
2,216,244
- ----------------------------------------------------------------------------------------------------
Commercial Banks--1.1%
BNP Paribas 16,287 1,790,820
Credit Agricole SA 36,381 1,546,695
------------
3,337,515
- ----------------------------------------------------------------------------------------------------
Construction & Engineering--0.3%
Vinci SA 9,300 1,047,498
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.2%
France Telecom SA 31,500 818,145
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.3%
Electricite de France 15,418 934,907
- ----------------------------------------------------------------------------------------------------
Insurance--0.3%
Assurances Generales de France (AGF) 5,778 811,196
- ----------------------------------------------------------------------------------------------------
Machinery--0.3%
Vallourec 3,326 827,775
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable
Fuels--0.6%
Total SA 24,343 1,648,219
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in France 11,641,499
====================================================================================================
Germany--3.0%
Air Freight & Logistics--0.3%
Deutsche Post AG 31,807 880,923
- ----------------------------------------------------------------------------------------------------
Automobiles--0.2%
Bayerische Motoren Werke AG 12,937 743,022
- ----------------------------------------------------------------------------------------------------
Chemicals--0.8%
BASF AG 14,452 1,273,826
Bayer AG 20,121 1,013,099
------------
2,286,925
- ----------------------------------------------------------------------------------------------------
Construction & Engineering--0.3%
Hochtief AG 13,315 870,095
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.5%
E.ON AG 11,960 1,434,876
- ----------------------------------------------------------------------------------------------------
Insurance--0.5%
Allianz AG Registered Shares 7,892 1,464,761
- ----------------------------------------------------------------------------------------------------
Multi-Utilities--0.4%
RWE AG 11,800 1,166,129
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Germany 8,846,731
====================================================================================================
Hong Kong--1.3%
Commercial Banks--0.3%
HSBC Holdings Plc 40,200 758,803
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.1%
Cheung Kong Infrastructure Holdings Ltd. 135,600 406,249
- ----------------------------------------------------------------------------------------------------
Industrial Conglomerates--0.3%
Hutchison Whampoa Ltd. 104,300 925,359
- ----------------------------------------------------------------------------------------------------
Real Estate Management &
Development--0.6%
Cheung Kong Holdings Ltd. 49,200 535,195
Sun Hung Kai Properties Ltd. 59,900 655,055
Wharf Holdings Ltd. 127,000 431,106
------------
1,621,356
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Hong Kong 3,711,767
====================================================================================================
Hungary--0.2%
Oil, Gas & Consumable
Fuels--0.2%
Mol Magyar Olaj-es Gazipari Rt. 6,868 682,844
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Hungary 682,844
====================================================================================================
India--3.0%
Automobiles--0.2%
Bajaj Auto Ltd. 5,700 347,848
Tata Motors Ltd. 15,564 286,100
------------
633,948
- ----------------------------------------------------------------------------------------------------
Commercial Banks--0.2%
Karnataka Bank Ltd. 30,800 81,737
State Bank of India Ltd. 15,600 379,572
------------
461,309
- ----------------------------------------------------------------------------------------------------
Construction Materials--0.1%
Gujarat Ambuja Cements Ltd. 152,600 398,190
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--0.0%
Reliance Capital Ltd. 4,100 53,269
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.0%
Reliance Energy Ltd. 6,150 65,898
- ----------------------------------------------------------------------------------------------------
Gas Utilities--0.0%
Reliance Natural Resources Ltd. (a) 82,000 46,345
- ----------------------------------------------------------------------------------------------------
IT Services--0.3%
Infosys Technologies Ltd. 16,900 786,452
- ----------------------------------------------------------------------------------------------------
10 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
India (concluded)
Media--0.2%
ZEE Telefilms Ltd. (a) 100,114 $ 670,873
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--1.1%
Hindustan Petroleum Corp. 8,300 59,886
Reliance Industries Ltd. 116,000 3,158,250
------------
3,218,136
- ----------------------------------------------------------------------------------------------------
Pharmaceuticals--0.0%
Wockhardt Ltd. 6,150 53,135
- ----------------------------------------------------------------------------------------------------
Road & Rail--0.2%
Container Corp. of India 13,100 596,380
- ----------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance--0.3%
Housing Development Finance Corp. 22,700 737,964
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.4%
Reliance Communication Ventures Ltd. (a) 140,000 1,177,859
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in India 8,899,758
====================================================================================================
Ireland--0.4%
Commercial Banks--0.4%
Allied Irish Banks Plc 47,623 1,297,687
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Ireland 1,297,687
====================================================================================================
Israel--0.2%
Communications Equipment--0.1%
ECI Telecom Ltd. (a)(b) 58,300 432,586
- ----------------------------------------------------------------------------------------------------
Pharmaceuticals--0.1%
Teva Pharmaceutical Industries Ltd. (b) 6,225 205,238
- ----------------------------------------------------------------------------------------------------
Software--0.0%
Ectel Ltd. (a)(b) 4,251 21,680
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Israel 659,504
====================================================================================================
Italy--1.8%
Commercial Banks--0.5%
Capitalia SpA 92,333 816,550
UniCredito Italiano SpA 87,137 722,444
------------
1,538,994
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.6%
Telecom Italia SpA 251,061 760,063
Telecom Italia SpA (RNC) 427,550 1,080,457
------------
1,840,520
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--0.7%
ENI SpA 68,832 2,075,915
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Italy 5,455,429
====================================================================================================
Japan--12.5%
Auto Components--0.2%
Toyota Industries Corp. 15,800 688,983
- ----------------------------------------------------------------------------------------------------
Automobiles--0.7%
Honda Motor Co., Ltd. 7,400 261,947
Suzuki Motor Corp. 61,200 1,737,284
------------
1,999,231
- ----------------------------------------------------------------------------------------------------
Beverages--0.6%
Coca-Cola Central Japan Co., Ltd. 39 309,119
Coca-Cola West Holdings Co. Ltd. 49,075 916,839
Hokkaido Coca-Cola Bottling Co., Ltd. 15,000 94,267
Mikuni Coca-Cola Bottling Co., Ltd. 39,500 387,722
------------
1,707,947
- ----------------------------------------------------------------------------------------------------
Building Products--0.1%
Asahi Glass Co., Ltd. 29,200 336,304
- ----------------------------------------------------------------------------------------------------
Capital Markets--0.2%
Nomura Holdings, Inc. 38,000 670,942
- ----------------------------------------------------------------------------------------------------
Chemicals--0.6%
Shin-Etsu Chemical Co., Ltd. 13,500 885,341
Sumitomo Chemical Co., Ltd. 108,600 774,421
------------
1,659,762
- ----------------------------------------------------------------------------------------------------
Commercial Banks--1.4%
The Bank of Fukuoka Ltd. 75,000 598,948
The Bank of Kyoto Ltd. 54,000 554,521
The Bank of Yokohama Ltd. 61,300 473,816
Mitsubishi UFJ Financial Group, Inc. 40 502,757
Shinsei Bank Ltd. 71,400 412,082
Sumitomo Mitsui Financial Group, Inc. 135 1,477,491
------------
4,019,615
- ----------------------------------------------------------------------------------------------------
Construction & Engineering--0.5%
JGC Corp. 45,377 706,524
Kinden Corp. 32,000 238,861
Okumura Corp. 115,000 581,121
------------
1,526,506
- ----------------------------------------------------------------------------------------------------
Consumer Finance--0.2%
Credit Saison Co., Ltd. 14,700 531,666
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--0.7%
RHJ International (a) 65,000 1,223,660
RHJ International (a)(b)(f) 41,200 775,612
------------
1,999,272
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.3%
Chubu Electric Power Co., Inc. 18,600 515,275
Hokuriku Electric Power 23,200 484,015
------------
999,290
- ----------------------------------------------------------------------------------------------------
Electronic Equipment &
Instruments--0.2%
Murata Manufacturing Co., Ltd. 10,000 699,414
- ----------------------------------------------------------------------------------------------------
Food & Staples Retailing--0.4%
Ministop Co., Ltd. 4,200 72,361
Seven & I Holdings Co. Ltd. 30,500 977,940
------------
1,050,301
- ----------------------------------------------------------------------------------------------------
Food Products--0.2%
Ajinomoto Co., Inc. 40,100 463,899
House Foods Corp. 5,200 84,833
------------
548,732
- ----------------------------------------------------------------------------------------------------
Gas Utilities--0.3%
Tokyo Gas Co., Ltd. 195,000 995,383
- ----------------------------------------------------------------------------------------------------
Household Durables--0.1%
Rinnai Corp. 6,600 187,354
- ----------------------------------------------------------------------------------------------------
Household Products--0.1%
Rohto Pharmaceutical Co., Ltd. 15,750 157,695
- ----------------------------------------------------------------------------------------------------
Insurance--2.8%
Aioi Insurance Co., Ltd. 206,200 1,419,272
Millea Holdings, Inc. 75,000 2,834,424
Mitsui Sumitomo Insurance Co., Ltd. 205,030 2,550,713
Nipponkoa Insurance Co., Ltd. 187,800 1,494,949
------------
8,299,358
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 11
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
Japan (concluded)
Machinery--0.3%
Fanuc Ltd. 2,200 $ 190,928
Kubota Corp. 91,800 802,970
------------
993,898
- ----------------------------------------------------------------------------------------------------
Media--0.2%
Toho Co., Ltd. 34,300 648,138
- ----------------------------------------------------------------------------------------------------
Office Electronics--0.4%
Canon, Inc. 23,000 1,233,038
- ----------------------------------------------------------------------------------------------------
Pharmaceuticals--0.8%
Shionogi & Co., Ltd. 17,700 354,893
Takeda Pharmaceutical Co., Ltd. 25,800 1,656,688
Tanabe Seiyaku Co., Ltd. 22,100 272,105
------------
2,283,686
- ----------------------------------------------------------------------------------------------------
Real Estate Management &
Development--0.1%
NTT Urban Development Co. 47 405,883
- ----------------------------------------------------------------------------------------------------
Road & Rail--0.2%
East Japan Railway Co. 85 594,502
- ----------------------------------------------------------------------------------------------------
Tobacco--0.2%
Japan Tobacco, Inc. 130 566,885
- ----------------------------------------------------------------------------------------------------
Trading Companies &
Distributors--0.3%
Mitsubishi Corp. 48,800 942,995
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.4%
NTT DoCoMo, Inc. 810 1,239,708
Okinawa Cellular Telephone Co. 15 36,040
------------
1,275,748
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Japan 37,022,528
====================================================================================================
Malaysia--0.7%
Diversified Telecommunication
Services--0.0%
Telekom Malaysia Bhd 28,400 68,036
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.2%
Tenaga Nasional Bhd 245,841 673,076
- ----------------------------------------------------------------------------------------------------
Food Products--0.3%
IOI Corp. Bhd 158,500 746,393
- ----------------------------------------------------------------------------------------------------
Independent Power Producers &
Energy Traders--0.0%
Malakoff Bhd 11,700 31,552
- ----------------------------------------------------------------------------------------------------
Tobacco--0.1%
British American Tobacco Malaysia Bhd 29,000 335,455
- ----------------------------------------------------------------------------------------------------
Transportation
Infrastructure--0.0%
PLUS Expressways Bhd 83,900 66,155
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.1%
Maxis Communications Bhd 52,800 129,380
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Malaysia 2,050,047
====================================================================================================
Mexico--0.6%
Beverages--0.2%
Fomento Economico Mexicano,
SA de CV (b) 6,000 580,140
- ----------------------------------------------------------------------------------------------------
Media--0.4%
Grupo Televisa, SA (b) 42,250 1,042,730
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Mexico 1,622,870
====================================================================================================
Netherlands--0.8%
Diversified Financial
Services--0.5%
ING Groep NV CVA 33,356 1,477,692
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.3%
Mittal Steel Co. NV 20,718 889,263
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in the Netherlands 2,366,955
====================================================================================================
New Zealand--0.1%
Diversified Telecommunication
Services--0.0%
Telecom Corp. of New Zealand Ltd. 32,300 101,041
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.1%
Contact Energy Ltd. 26,900 134,241
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in New Zealand 235,282
====================================================================================================
Norway--0.4%
Diversified Telecommunication
Services--0.1%
Telenor ASA 11,000 173,746
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--0.3%
Statoil ASA 39,826 1,006,792
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Norway 1,180,538
====================================================================================================
Peru--0.1%
Metals & Mining--0.1%
Southern Copper Corp. 3,400 174,692
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Peru 174,692
====================================================================================================
Singapore--2.0%
Commercial Banks--0.1%
Oversea-Chinese Banking Corp. 80,000 359,712
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.5%
Singapore Telecommunications Ltd. 821,960 1,399,148
- ----------------------------------------------------------------------------------------------------
Health Care Providers &
Services--0.1%
Parkway Holdings Ltd. 223,500 397,672
- ----------------------------------------------------------------------------------------------------
Industrial Conglomerates--0.7%
Fraser and Neave Ltd. 270,500 771,467
Keppel Corp. Ltd. 110,300 1,119,437
------------
1,890,904
- ----------------------------------------------------------------------------------------------------
Real Estate Management &
Development--0.5%
CapitaLand Ltd. 287,600 1,006,822
Keppel Land Ltd. 154,300 545,125
------------
1,551,947
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.1%
MobileOne Ltd. 310,100 394,397
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Singapore 5,993,780
====================================================================================================
12 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
South Africa--0.2%
Metals & Mining--0.1%
Gold Fields Ltd. (b) 14,900 $ 249,724
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--0.1%
Sasol Ltd. 5,100 175,025
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in South Africa 424,749
====================================================================================================
South Korea--2.7%
Commercial Banks--0.3%
Daegu Bank 14,600 241,719
Hana Financial Group, Inc. 5,700 262,844
Kookmin Bank 3,000 238,472
Pusan Bank 19,000 243,990
------------
987,025
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.5%
KT Corp. (b) 58,200 1,302,516
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.2%
Korea Electric Power Corp. 16,100 621,958
- ----------------------------------------------------------------------------------------------------
Electrical Equipment--0.1%
LS Cable Ltd. 7,000 294,189
- ----------------------------------------------------------------------------------------------------
Electronic Equipment &
Instruments--0.0%
Fine DNC Co., Ltd. 19,300 94,324
- ----------------------------------------------------------------------------------------------------
Food Products--0.2%
CJ Corp. 3,800 429,504
Nong Shim Co., Ltd. 400 108,676
------------
538,180
- ----------------------------------------------------------------------------------------------------
Insurance--0.3%
Dongbu Insurance Co., Ltd. 10,700 254,938
Korean Reinsurance Co. 41,100 464,542
Meritz Fire & Marine Insurance Co. Ltd. 42,200 264,240
------------
983,720
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.5%
POSCO 3,100 860,334
POSCO (b) 9,400 662,888
------------
1,523,222
- ----------------------------------------------------------------------------------------------------
Multiline Retail--0.0%
Lotte Shopping Co. (a)(b)(f) 3,100 58,730
- ----------------------------------------------------------------------------------------------------
Textiles, Apparel & Luxury
Goods--0.1%
Cheil Industries, Inc. 4,200 174,731
- ----------------------------------------------------------------------------------------------------
Tobacco--0.4%
KT&G Corp. 18,100 1,117,984
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.1%
SK Telecom Co., Ltd. 900 195,330
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in South Korea 7,891,909
====================================================================================================
Spain--0.4%
Commercial Banks--0.4%
Banco Bilbao Vizcaya Argentaria SA 44,758 1,080,805
- ----------------------------------------------------------------------------------------------------
Transportation Infrastructure--0.0%
Cintra Concesiones de Infraestructuras
de Transporte SA 6,000 91,971
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Spain 1,172,776
====================================================================================================
Sweden--1.0%
Commercial Banks--0.3%
Svenska Handelsbanken Class A 30,863 799,095
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--0.5%
Investor AB 66,138 1,483,490
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.2%
TeliaSonera AB 102,575 745,623
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Sweden 3,028,208
====================================================================================================
Switzerland--1.6%
Capital Markets--1.2%
Credit Suisse Group 34,539 2,082,252
UBS AG 25,234 1,507,083
------------
3,589,335
- ----------------------------------------------------------------------------------------------------
Insurance--0.4%
Swiss Reinsurance Registered Shares 14,952 1,225,919
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Switzerland 4,815,254
====================================================================================================
Taiwan--1.0%
Commercial Banks--0.2%
Chinatrust Financial Holding Co. 431,000 312,924
SinoPac Financial Holdings Co., Ltd. 226,000 114,147
Taishin Financial Holdings Co., Ltd. (a) 186,400 95,547
------------
522,618
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--0.1%
Fubon Financial Holding Co. Ltd. 285,200 232,361
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--0.4%
Chunghwa Telecom Co Ltd. 127,900 219,175
Chunghwa Telecom Co. Ltd. (b) 47,634 871,226
------------
1,090,401
- ----------------------------------------------------------------------------------------------------
Electronic Equipment &
Instruments--0.2%
Delta Electronics, Inc. 222,045 627,500
- ----------------------------------------------------------------------------------------------------
Insurance--0.1%
Cathay Financial Holding Co., Ltd. 246,308 477,621
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Taiwan 2,950,501
====================================================================================================
Thailand--0.8%
Commercial Banks--0.3%
Siam Commercial Bank PCL
Foreign Shares 460,000 814,991
- ----------------------------------------------------------------------------------------------------
Construction Materials--0.1%
Siam Cement PCL Foreign Shares 41,400 300,168
Siam City Cement PCL Foreign Shares 7,600 50,960
------------
351,128
- ----------------------------------------------------------------------------------------------------
Electronic Equipment &
Instruments--0.0%
Hana Microelectronics PCL 123,100 90,595
- ----------------------------------------------------------------------------------------------------
Food Products--0.0%
Thai Union Frozen Products PCL
Foreign Shares 38,800 26,440
- ----------------------------------------------------------------------------------------------------
Household Durables--0.1%
Land and Houses PCL Foreign Shares 446,100 105,179
- ----------------------------------------------------------------------------------------------------
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 13
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
Thailand (concluded)
Oil, Gas & Consumable
Fuels--0.2%
PTT Exploration & Production PCL 107,900 $ 320,575
PTT PCL 61,800 373,958
------------
694,533
- ----------------------------------------------------------------------------------------------------
Transportation
Infrastructure--0.1%
Airports of Thailand PCL 162,900 288,613
Bangkok Expressway PCL Foreign Shares 58,400 37,408
------------
326,021
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in Thailand 2,408,887
====================================================================================================
United Kingdom--7.5%
Aerospace & Defense--0.4%
BAE Systems Plc 140,519 1,124,463
- ----------------------------------------------------------------------------------------------------
Beverages--0.3%
Diageo Plc (b) 10,400 774,488
- ----------------------------------------------------------------------------------------------------
Commercial Banks--2.4%
Barclays Plc 163,969 2,212,923
HBOS Plc 118,832 2,464,002
HSBC Holdings Plc 125,263 2,375,130
------------
7,052,055
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--0.0%
Guinness Peat Group Plc 82,720 136,309
- ----------------------------------------------------------------------------------------------------
Food Products--0.4%
Cadbury Schweppes Plc 25,500 1,035,045
- ----------------------------------------------------------------------------------------------------
Insurance--0.9%
Aviva Plc 107,384 1,587,521
Prudential Plc 94,831 1,162,255
------------
2,749,776
- ----------------------------------------------------------------------------------------------------
Media--0.1%
NTL, Inc. 10,850 293,275
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable
Fuels--0.9%
Royal Dutch Shell Plc Class B 71,042 2,545,006
- ----------------------------------------------------------------------------------------------------
Pharmaceuticals--0.6%
GlaxoSmithKline Plc 73,031 1,950,354
- ----------------------------------------------------------------------------------------------------
Specialty Retail--0.3%
Kesa Electricals Plc 131,708 881,227
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--1.2%
Vodafone Group Plc 1,160,190 2,987,728
Vodafone Group Plc (b) 22,049 569,967
------------
3,557,695
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in the United Kingdom 22,099,693
====================================================================================================
United States--31.7%
Aerospace & Defense--0.1%
Boeing Co. 200 15,972
General Dynamics Corp. 1,900 135,090
Lockheed Martin Corp. 200 17,386
Northrop Grumman Corp. 300 19,917
Raytheon Co. 400 19,980
------------
208,345
- ----------------------------------------------------------------------------------------------------
Air Freight & Logistics--0.1%
FedEx Corp. 1,500 171,810
- ----------------------------------------------------------------------------------------------------
Airlines--0.0%
AMR Corp. (a) 400 11,336
- ----------------------------------------------------------------------------------------------------
Beverages--0.4%
The Coca-Cola Co. 15,200 710,144
Constellation Brands, Inc. Class A (a) 10,700 294,143
Molson Coors Brewing Co. Class B 4,400 313,192
PepsiAmericas, Inc. 1,400 28,630
------------
1,346,109
- ----------------------------------------------------------------------------------------------------
Biotechnology--0.0%
Amgen, Inc. (a) 1,100 83,501
- ----------------------------------------------------------------------------------------------------
Capital Markets--0.4%
Ameriprise Financial, Inc. 300 15,450
The Bank of New York Co., Inc. 12,500 429,625
The Bear Stearns Cos., Inc. 100 15,135
Goldman Sachs Group, Inc. 100 18,979
Knight Capital Group, Inc. Class A (a) 20,800 387,920
Lehman Brothers Holdings, Inc. 1,400 108,976
Mellon Financial Corp. 1,200 46,560
Morgan Stanley 200 15,286
------------
1,037,931
- ----------------------------------------------------------------------------------------------------
Chemicals--0.1%
E.I. du Pont de Nemours & Co. 6,300 288,540
PPG Industries, Inc. 300 20,520
Tronox, Inc. Class B 2,359 30,856
------------
339,916
- ----------------------------------------------------------------------------------------------------
Commercial Banks--0.6%
Fifth Third Bancorp 8,400 334,740
National City Corp. 500 18,625
Santander BanCorp 1,200 22,440
Wachovia Corp. 7,400 410,700
Wells Fargo & Co. 24,000 870,960
------------
1,657,465
- ----------------------------------------------------------------------------------------------------
Commercial Services &
Supplies--0.0%
Waste Management, Inc. 400 14,992
- ----------------------------------------------------------------------------------------------------
Communications Equipment--1.6%
3Com Corp. (a) 174,800 849,528
Cisco Systems, Inc. (a) 100,600 2,427,478
Comverse Technology, Inc. (a) 3,400 74,018
Extreme Networks, Inc. (a) 14,600 55,480
JDS Uniphase Corp. (a) 6,748 98,077
Motorola, Inc. 58,100 1,339,786
Tellabs, Inc. (a) 4,500 47,430
------------
4,891,797
- ----------------------------------------------------------------------------------------------------
14 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
United States (continued)
Computers & Peripherals--1.0%
Hewlett-Packard Co. 13,200 $ 511,368
International Business Machines Corp. 13,700 1,264,921
Lexmark International, Inc. Class A (a) 9,600 610,464
Sun Microsystems, Inc. (a) 86,000 466,980
------------
2,853,733
- ----------------------------------------------------------------------------------------------------
Construction & Engineering--0.6%
Chicago Bridge & Iron Co. NV 2,700 66,312
Foster Wheeler Ltd. (a) 37,600 1,690,120
------------
1,756,432
- ----------------------------------------------------------------------------------------------------
Containers & Packaging--0.2%
Crown Holdings, Inc. (a) 13,200 256,608
Smurfit-Stone Container Corp. (a) 17,400 185,484
------------
442,092
- ----------------------------------------------------------------------------------------------------
Diversified Consumer
Services--0.1%
Career Education Corp. (a) 14,900 331,972
- ----------------------------------------------------------------------------------------------------
Diversified Financial
Services--1.0%
Bank of America Corp. 18,550 999,288
CIT Group, Inc. 200 10,410
Citigroup, Inc. 36,300 1,820,808
JPMorgan Chase & Co. 4,300 203,992
Leucadia National Corp. 400 10,548
------------
3,045,046
- ----------------------------------------------------------------------------------------------------
Diversified Telecommunication
Services--1.1%
AT&T, Inc. 25,400 869,950
BellSouth Corp. 8,300 374,330
Cincinnati Bell, Inc. (a) 9,000 42,210
Embarq Corp. 1,835 88,722
General Communication, Inc. Class A (a) 15,300 200,583
Qwest Communications International
Inc. (a) 1,800 15,534
Verizon Communications, Inc. 45,200 1,672,400
Windstream Corp. 9,291 127,473
------------
3,391,202
- ----------------------------------------------------------------------------------------------------
Electric Utilities--0.4%
Mirant Corp. (a) 15,300 452,421
PPL Corp. 16,800 579,936
------------
1,032,357
- ----------------------------------------------------------------------------------------------------
Energy Equipment & Services--1.1%
Baker Hughes, Inc. 1,600 110,480
ENSCO International, Inc. 6,300 308,511
GlobalSantaFe Corp. 12,900 669,510
Halliburton Co. 10,000 323,500
Key Energy Services, Inc. (a) 20,000 280,000
National Oilwell Varco, Inc. (a) 4,225 255,190
Schlumberger Ltd. 13,800 870,504
Tidewater, Inc. 2,500 124,325
Transocean, Inc. (a) 2,400 174,096
Weatherford International Ltd. (a) 5,000 205,400
------------
3,321,516
- ----------------------------------------------------------------------------------------------------
Food & Staples Retailing--0.4%
CVS Corp. 8,400 263,592
The Kroger Co. 800 17,992
SUPERVALU Inc. 5,391 180,059
Safeway, Inc. 600 17,616
Senomyx, Inc. (a) 12,600 194,292
Wal-Mart Stores, Inc. 4,300 211,904
Walgreen Co. 4,300 187,824
------------
1,073,279
- ----------------------------------------------------------------------------------------------------
Food Products--0.2%
Archer Daniels Midland Co. 300 11,550
ConAgra Foods, Inc. 13,200 345,180
Sara Lee Corp. 10,700 182,970
------------
539,700
- ----------------------------------------------------------------------------------------------------
Health Care Equipment &
Supplies--0.3%
Bausch & Lomb, Inc. 7,000 374,780
Baxter International, Inc. 5,200 239,044
Boston Scientific Corp. (a) 7,950 126,485
------------
740,309
- ----------------------------------------------------------------------------------------------------
Health Care Providers &
Services --1.2%
Aetna, Inc. 8,800 362,736
AmerisourceBergen Corp. 3,300 155,760
Cardinal Health, Inc. 200 13,090
Caremark Rx, Inc. 5,725 281,842
Cigna Corp. 1,810 211,734
HCA, Inc. 5,825 294,279
Health Management Associates, Inc.
Class A 2,000 39,400
HealthSouth Corp. (a) 6,660 161,505
Humana, Inc. (a) 6,400 384,000
Manor Care, Inc. 6,650 319,133
McKesson Corp. 400 20,036
Medco Health Solutions, Inc. (a) 5,500 294,250
Tenet Healthcare Corp. (a) 26,400 186,384
Triad Hospitals, Inc. (a) 3,900 144,417
UnitedHealth Group, Inc. 9,725 474,386
WellPoint, Inc. (a) 4,525 345,348
------------
3,688,300
- ----------------------------------------------------------------------------------------------------
Hotels, Restaurants &
Leisure--0.9%
Darden Restaurants, Inc. 300 12,570
McDonald's Corp. 28,100 1,177,952
Panera Bread Co. Class A (a) 21,300 1,316,340
Tim Hortons, Inc. 3,791 109,588
Wendy's International, Inc. 2,800 96,880
------------
2,713,330
- ----------------------------------------------------------------------------------------------------
Household Products--0.1%
The Procter & Gamble Co. 5,700 361,323
- ----------------------------------------------------------------------------------------------------
IT Services--0.0%
Accenture Ltd. Class A 400 13,164
- ----------------------------------------------------------------------------------------------------
Independent Power Producers &
Energy Traders--0.3%
The AES Corp. (a) 13,200 290,268
Dynegy, Inc. Class A (a) 26,500 161,120
TXU Corp. 7,400 467,162
------------
918,550
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 15
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
United States (continued)
Industrial Conglomerates--2.1%
General Electric Co. (h) 110,300 $ 3,872,633
McDermott International, Inc. (a) 33,450 1,495,215
Tyco International Ltd. 30,400 894,672
------------
6,262,520
- ----------------------------------------------------------------------------------------------------
Insurance--4.2%
ACE Ltd. 20,000 1,145,000
The Allstate Corp. 9,700 595,192
American International Group, Inc. 52,700 3,539,859
Assurant, Inc. 6,100 321,226
Bristol West Holdings, Inc. 3,400 47,328
Chubb Corp. 300 15,945
Darwin Professional Underwriters, Inc. (a) 3,400 76,500
Endurance Specialty Holdings Ltd. 28,000 998,200
Everest Re Group Ltd. 2,400 238,032
Genworth Financial, Inc. Class A 500 16,720
Hartford Financial Services Group, Inc. 5,200 453,284
IPC Holdings, Ltd. 18,500 555,740
Lincoln National Corp. 200 12,662
Loews Corp. 500 19,460
Marsh & McLennan Cos., Inc. 6,700 197,248
Platinum Underwriters Holdings Ltd. 15,300 456,858
Prudential Financial, Inc. 3,100 238,483
RenaissanceRe Holdings Ltd. 10,800 587,520
The St. Paul Travelers Cos., Inc. 21,500 1,099,295
W.R. Berkley Corp. 300 11,058
XL Capital Ltd. Class A 26,300 1,855,465
------------
12,481,075
- ----------------------------------------------------------------------------------------------------
Internet & Catalog Retail--0.0%
Liberty Media Holding Corp.--
Interactive (a) 3,425 75,590
- ----------------------------------------------------------------------------------------------------
Internet Software &
Services--0.2%
eBay, Inc. (a) 15,000 481,950
- ----------------------------------------------------------------------------------------------------
Leisure Equipment &
Products--0.1%
Mattel, Inc. 7,100 160,673
- ----------------------------------------------------------------------------------------------------
Life Sciences Tools &
Services--0.1%
Waters Corp. (a) 3,100 154,380
- ----------------------------------------------------------------------------------------------------
Machinery--0.0%
Cummins, Inc. 100 12,698
Eaton Corp. 300 21,729
------------
34,427
- ----------------------------------------------------------------------------------------------------
Media--0.6%
CBS Corp. Class B 2,600 75,244
Comcast Corp. Class A (a) 23,300 947,611
Discovery Holding Co. (a) 1,800 26,712
Liberty Global, Inc. (a) 1,816 47,652
Liberty Global, Inc. Series C (a) 1,842 46,842
Liberty Media Holding Corp.--Capital (a) 685 61,006
The McGraw-Hill Cos., Inc. 200 12,834
Omnicom Group 200 20,290
Time Warner, Inc. 11,800 236,118
Viacom, Inc. Class B (a) 5,350 208,222
Walt Disney Co. 400 12,584
------------
1,695,115
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.6%
Alcoa, Inc. 36,800 1,063,888
Freeport-McMoRan Copper & Gold, Inc.
Class B (a) 8,200 495,936
Newmont Mining Corp. 7,300 330,471
Nucor Corp. 200 11,682
------------
1,901,977
- ----------------------------------------------------------------------------------------------------
Multi-Utilities--0.1%
CMS Energy Corp. (a) 15,400 229,306
PG&E Corp. 300 12,942
------------
242,248
- ----------------------------------------------------------------------------------------------------
Multiline Retail--0.0%
JC Penney Co., Inc. 200 15,046
Kohl's Corp. (a) 300 21,180
Nordstrom, Inc. 300 14,205
Sears Holdings Corp. (a) 100 17,447
------------
67,878
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--3.5%
Alon USA Energy, Inc. 1,700 47,719
Arch Coal, Inc. 1,000 34,630
Chevron Corp. 15,600 1,048,320
ConocoPhillips 15,100 909,624
Consol Energy, Inc. 3,400 120,326
Devon Energy Corp. 3,650 243,966
El Paso Corp. 145,900 1,998,830
Exxon Mobil Corp. (h) 49,200 3,513,864
Foundation Coal Holdings, Inc. 2,600 95,446
Hess Corp. 5,500 233,200
Marathon Oil Corp. 5,200 449,280
Murphy Oil Corp. 7,600 358,416
Noble Energy, Inc. 3,900 189,657
Occidental Petroleum Corp. 12,600 591,444
Pogo Producing Co. 7,000 313,250
Stone Energy Corp. (a) 5,000 194,850
Williams Cos., Inc. 1,100 26,873
------------
10,369,695
- ----------------------------------------------------------------------------------------------------
Paper & Forest Products--0.2%
International Paper Co. 13,800 460,230
- ----------------------------------------------------------------------------------------------------
Personal Products--0.1%
Avon Products, Inc. 7,200 218,952
- ----------------------------------------------------------------------------------------------------
Pharmaceuticals--2.4%
Abbott Laboratories 9,500 451,345
Andrx Corp. (a) 6,700 164,753
Bristol-Myers Squibb Co. 11,700 289,575
Eli Lilly & Co. 6,600 369,666
Johnson & Johnson 31,700 2,136,580
King Pharmaceuticals, Inc. (a) 900 15,057
Merck & Co., Inc. 16,750 760,785
Pfizer, Inc. 54,800 1,460,420
Schering-Plough Corp. 19,600 433,944
Valeant Pharmaceuticals International 17,500 326,900
Watson Pharmaceuticals, Inc. (a) 3,350 90,149
Wyeth 11,400 581,742
------------
7,080,916
- ----------------------------------------------------------------------------------------------------
16 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (continued) (in U.S. dollars)
Shares
Country Industry Common Stocks Held Value
====================================================================================================
United States (continued)
Real Estate Investment
Trusts (REITs)--0.1%
Friedman Billings Ramsey Group, Inc.
Class A 41,500 $ 316,645
Ventas, Inc. 3,100 120,838
------------
437,483
- ----------------------------------------------------------------------------------------------------
Road & Rail--1.3%
CSX Corp. 30,300 1,080,801
Norfolk Southern Corp. 11,600 609,812
Union Pacific Corp. 24,000 2,175,120
------------
3,865,733
- ----------------------------------------------------------------------------------------------------
Semiconductors & Semiconductor
Equipment--0.3%
Agere Systems, Inc. (a) 2,800 47,544
Cirrus Logic, Inc. (a) 12,600 88,956
Freescale Semiconductor, Inc. Class B (a) 500 19,665
Genesis Microchip, Inc. (a) 10,600 108,650
Intel Corp. 25,500 544,170
Micron Technology, Inc. (a) 700 10,115
------------
819,100
- ----------------------------------------------------------------------------------------------------
Software--2.0%
Borland Software Corp. (a) 6,900 38,088
CA, Inc. 72,200 1,787,672
Microsoft Corp. (h) 108,000 3,100,680
Novell, Inc. (a) 103,100 618,600
TIBCO Software, Inc. (a) 29,600 273,800
------------
5,818,840
- ----------------------------------------------------------------------------------------------------
Specialty Retail--0.0%
Best Buy Co., Inc. 200 11,050
Limited Brands 500 14,735
Office Depot, Inc. (a) 300 12,597
Staples, Inc. 400 10,316
TJX Cos., Inc. 600 17,370
------------
66,068
- ----------------------------------------------------------------------------------------------------
Textiles, Apparel & Luxury
Goods--0.0%
Hanesbrands, Inc. (a) 1,350 31,860
Unifi, Inc. (a) 38,100 105,537
------------
137,397
- ----------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance--0.2%
Accredited Home Lenders Holding Co. (a) 126 3,856
Countrywide Financial Corp. 500 19,060
Fannie Mae 8,475 502,228
Washington Mutual, Inc. 3,640 153,972
------------
679,116
- ----------------------------------------------------------------------------------------------------
Tobacco--0.3%
Alliance One International, Inc. (a) 7,100 34,222
Altria Group, Inc. 9,300 756,369
Loews Corp.--Carolina Group 300 17,346
Reynolds American, Inc. 200 12,632
------------
820,569
- ----------------------------------------------------------------------------------------------------
Transportation
Infrastructure--0.5%
Macquarie Infrastructure Co. Trust 48,700 1,452,721
- ----------------------------------------------------------------------------------------------------
Wireless Telecommunication
Services--0.6%
Alltel Corp. 13,400 714,354
Sprint Nextel Corp. 60,000 1,121,400
------------
1,835,754
- ----------------------------------------------------------------------------------------------------
Total Common Stocks in the United States 93,605,914
====================================================================================================
Total Common Stocks
(Cost--$226,336,640)--85.2% 251,777,727
====================================================================================================
Preferred Stocks
====================================================================================================
United States--0.2%
Thrifts & Mortgage Finance--0.2%
Fannie Mae Series 2004-1, 5.375% (c) 5 483,124
- ----------------------------------------------------------------------------------------------------
Total Preferred Stocks
(Cost--$460,000)--0.2% 483,124
====================================================================================================
Exchange-Traded Funds
====================================================================================================
Brazil--0.5%
iShares MSCI Brazil (Free) Index Fund 38,000 1,595,240
- ----------------------------------------------------------------------------------------------------
Total Exchange-Traded Funds in Brazil 1,595,240
====================================================================================================
South Korea--1.2%
iShares MSCI South Korea Index Fund 76,100 3,595,725
- ----------------------------------------------------------------------------------------------------
Total Exchange-Traded Funds in South Korea 3,595,725
====================================================================================================
United States--1.6%
Consumer Staples Select Sector
SPDR Fund 37,600 971,208
Health Care Select Sector SPDR Fund 37,900 1,262,070
iShares Dow Jones US Telecommunica-
tions Sector Index Fund 15,400 440,902
Telecom HOLDRs Trust 4,900 167,482
Utilities Select Sector SPDR Fund 51,500 1,843,700
- ----------------------------------------------------------------------------------------------------
Total Exchange-Traded Funds in the United States 4,685,362
====================================================================================================
Total Exchange-Traded Funds
(Cost--$9,202,532)--3.3% 9,876,327
====================================================================================================
Mutual Funds (a)
====================================================================================================
Vietnam--0.5%
Diversified Financial Services--0.5%
Vietnam Enterprise Investments
Ltd.--C Shares 552,000 552,000
Vietnam Opportunity Fund Ltd. 340,440 840,887
- ----------------------------------------------------------------------------------------------------
Total Mutual Funds
(Cost--$1,367,767)--0.5% 1,392,887
====================================================================================================
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 17
Schedule of Investments (continued) (in U.S. dollars)
====================================================================================================
Fixed Income Securities
- ----------------------------------------------------------------------------------------------------
Face
Country Industry Corporate Bonds Amount Value
====================================================================================================
Canada--0.0%
Metals & Mining--0.0%
Bema Gold Corp., 3.25%
due 2/25/2011 (c) USD 30,000 $ 32,545
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in Canada 32,545
====================================================================================================
China--0.4%
Automobiles--0.1%
Brilliance China Finance Ltd., 0%
due 6/07/2011 (c)(e) 170,000 170,221
- ----------------------------------------------------------------------------------------------------
Food Products--0.1%
Chaoda Modern Agriculture
Holdings Ltd., 0%
due 5/08/2011 (c)(e) HKD 2,780,000 366,391
- ----------------------------------------------------------------------------------------------------
Industrial Conglomerates--0.2%
Beijing Enterprises Investment
Ltd., 0% due 12/21/2010 (c)(e) USD 445,000 513,975
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in China 1,050,587
====================================================================================================
Hong Kong--0.1%
Real Estate Management &
Development--0.1%
Hongkong Land CB 2005 Ltd., 2.75%
due 12/21/2012 (c) 200,000 223,750
- ----------------------------------------------------------------------------------------------------
Trading Companies &
Distributors--0.0%
Noble Group Ltd., 0.90%
due 4/20/2009 (c) 80,000 82,700
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in Hong Kong 306,450
====================================================================================================
India--0.5%
Automobiles--0.3%
Tata Motors Ltd., 1% due 4/27/2011 (c) 755,000 890,900
- ----------------------------------------------------------------------------------------------------
Metals & Mining--0.0%
Gujarat NRE Coke Ltd., 0%
due 4/12/2011 (c)(e) 100,000 84,500
- ----------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance--0.2%
Housing Development Finance Corp.,
0% due 9/27/2010 (c)(e) 400,000 473,673
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in India 1,449,073
====================================================================================================
Malaysia--0.2%
Diversified Financial Services--0.1%
Feringghi Capital Ltd., 0%
due 12/22/2009 (c)(e) 300,000 311,625
- ----------------------------------------------------------------------------------------------------
Food Products--0.0%
IOI Investment Bhd, 0%
due 9/18/2009 (c)(e) 40,000 63,004
- ----------------------------------------------------------------------------------------------------
Multi-Utilities--0.1%
YTL Power Finance Cayman Ltd.,
0% due 5/09/2010 (c)(e) 200,000 213,500
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in Malaysia 588,129
====================================================================================================
Taiwan--0.1%
Construction Materials--0.1%
Taiwan Cement Corp., 0%
due 3/03/2009 (c)(e) 200,000 288,000
- ----------------------------------------------------------------------------------------------------
Insurance--0.0%
Shin Kong Financial Holding Co. Ltd.,
0% due 6/17/2009 (c)(e) 20,000 21,225
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in Taiwan 309,225
====================================================================================================
United States--0.2%
Biotechnology--0.0%
Cell Genesys, Inc., 3.125%
due 11/01/2011 (c) 90,000 73,125
Nabi Biopharmaceuticals, 2.875%
due 4/15/2025 (c) 50,000 45,500
------------
118,625
- ----------------------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels--0.2%
McMoRan Exploration Co., 5.25%
due 10/06/2011 (c) 480,000 537,600
- ----------------------------------------------------------------------------------------------------
Total Corporate Bonds in the United States 656,225
====================================================================================================
Total Corporate Bonds
(Cost--$4,132,627)--1.5% 4,392,234
====================================================================================================
Structured Notes (e)
====================================================================================================
Germany--0.5%
Goldman Sachs & Co. (DAX Linked
Notes), 0% due 10/19/2007 1,500,000 1,567,744
- ----------------------------------------------------------------------------------------------------
Total Structured Notes in Germany 1,567,744
====================================================================================================
Japan--3.3%
Goldman Sachs & Co.:
(TOPIX Linked Notes), 0%
due 7/30/2007 1,800,000 2,062,825
(TOPIX Linked Notes), 0%
due 8/03/2007 1,800,000 2,009,923
(TOPIX Linked Notes), 0%
due 1/28/2008 4,000,000 3,820,008
(TOPIX Linked Notes), 0%
due 2/16/2008 1,000,000 934,842
(TOPIX Linked Notes), Series B,
0% due 1/31/2007 807,000 844,640
- ----------------------------------------------------------------------------------------------------
Total Structured Notes in Japan 9,672,238
====================================================================================================
Taiwan--0.3%
UBS AG (Gold Linked Notes):
0% due 4/23/2008 520,000 530,556
0% due 4/28/2008 510,000 527,697
- ----------------------------------------------------------------------------------------------------
Total Structured Notes in Taiwan 1,058,253
====================================================================================================
United States--2.6%
Morgan Stanley (Bear Market Plus
S&P 500 Index Linked Notes),
0% due 3/05/2008 8,336,000 7,667,453
- ----------------------------------------------------------------------------------------------------
Total Structured Notes in the United States 7,667,453
====================================================================================================
Total Structured Notes
(Cost--$20,281,397)--6.7% 19,965,688
====================================================================================================
Total Fixed Income Securities
(Cost--$24,414,024)--8.2% 24,357,922
====================================================================================================
18 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Schedule of Investments (continued) (in U.S. dollars)
Beneficial
Country Short-Term Securities Interest Value
====================================================================================================
United States--4.1%
BlackRock Liquidity Series, LLC Cash
Sweep Series I, 5.22% (d)(g) USD 12,236,629 $ 12,236,629
- ----------------------------------------------------------------------------------------------------
Total Short-Term Securities
(Cost--$12,236,629)--4.1% 12,236,629
====================================================================================================
Number of
Options Purchased Contracts
====================================================================================================
Call Options Purchased
Financial Select Sector SPDR Fund,
expiring December 2006 at USD 35 18 1,980
Technology Select Sector SPDR,
expiring December 2006 at USD 22 16 1,760
- ----------------------------------------------------------------------------------------------------
Total Options Purchased
(Premiums Paid--$1,479)--0.0% 3,740
====================================================================================================
Total Investments
(Cost--$274,019,071)--101.5% 300,128,356
====================================================================================================
Options Written
====================================================================================================
Call Options Written
3Com Corp.:
expiring January 2007 at USD 5 178 (8,010)
expiring January 2008 at USD 5 1,428 (128,520)
Andrx Corp., expiring January 2007
at USD 15 35 (34,300)
Bausch & Lomb, Inc.:
expiring January 2007 at USD 50 35 (17,850)
expiring January 2008 at USD 45 35 (48,300)
Borland Software Corp., expiring
January 2007 at USD 7.5 69 (345)
CA, Inc., expiring January 2007 at USD 30 30 (300)
CBS Corp. Class B, expiring
January 2007 at USD 27.5 26 (5,460)
Career Education Corp.:
expiring January 2007 at USD 30 51 (1,275)
expiring January 2007 at USD 35 60 (600)
Chicago Bridge & Iron Co. NV,
expiring January 2007 at USD 25 27 (3,915)
Cirrus Logic, Inc., expiring January 2007
at USD 7.5 104 (4,160)
Cisco Systems, Inc., expiring January 2007
at USD 17.5 169 (117,793)
Comverse Technology, Inc., expiring
January 2007 at USD 25 17 (935)
eBay, Inc.:
expiring January 2008 at USD 20 78 (106,860)
expiring January 2008 at USD 25 72 (73,440)
El Paso Corp., expiring January 2008
at USD 15 84 (13,020)
Extreme Networks, Inc., expiring
January 2007 at USD 5 120 (600)
Fannie Mae, expiring January 2007
at USD 50 12 (12,720)
Intel Corp., expiring January 2007
at USD 25 25 (250)
Knight Capital Group, Inc. Class A,
expiring January 2007 at USD 10 208 (212,160)
Lexmark International, Inc. Class A,
expiring January 2007 at USD 50 62 (89,280)
Mattel, Inc., expiring January 2007
at USD 15 48 (37,440)
McDermott International, Inc.:
expiring January 2007 at USD 23.333 200 (654,000)
expiring January 2007 at USD 26.666 23 (64,515)
McDonald's Corp., expiring January 2007
at USD 35 201 (140,700)
Molson Coors Brewing Co. Class B,
expiring January 2007 at USD 60 11 (12,980)
Motorola, Inc.:
expiring January 2007 at USD 22.5 282 (46,530)
expiring January 2008 at USD 20 241 (127,730)
Murphy Oil Corp., expiring January 2007
at USD 50 35 (4,725)
Norfolk Southern Corp., expiring
January 2007 at USD 40 53 (66,780)
Novell, Inc., expiring January 2007
at USD 7.5 1,001 (10,010)
Panera Bread Co. Class A:
expiring January 2008 at USD 50 90 (162,900)
expiring January 2008 at USD 55 25 (37,250)
expiring January 2008 at USD 60 72 (84,960)
Pfizer, Inc., expiring January 2007
at USD 25 68 (13,940)
Sprint Nextel Corp., expiring
January 2008 at USD 22.5 251 (28,865)
TIBCO Software, Inc., expiring
January 2007 at USD 7.5 189 (35,910)
Tellabs, Inc., expiring January 2007
at USD 12.5 45 (1,350)
Tenet Healthcare Corp., expiring
January 2007 at USD 7.5 70 (3,150)
Tyco International Ltd., expiring
January 2007 at USD 25 30 (13,500)
Valeant Pharmaceuticals International,
expiring January 2007 at USD 15 142 (56,800)
Vodafone Group Plc, expiring
January 2007 at USD 20 65 (37,050)
Wendy's International, Inc., expiring
January 2007 at USD 45 17 (49,300)
- ----------------------------------------------------------------------------------------------------
Total Options Written
(Premiums Received--$1,624,604)--(0.9%) (2,570,478)
====================================================================================================
Total Investments, Net of Options Written
(Cost--$272,394,467*)--100.6% 297,557,878
Liabilities in Excess of Other Assets--(0.6%) (1,862,986)
------------
Net Assets--100.0% $295,694,892
============
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 19
Schedule of Investments (concluded) (in U.S. dollars)
* The cost and unrealized appreciation (depreciation) of investments, net of
options written, as of October 31, 2006, as computed for federal income
tax purposes, were as follows:
Aggregate cost ............................................ $273,199,180
============
Gross unrealized appreciation ............................. $ 30,541,042
Gross unrealized depreciation ............................. (6,182,344)
------------
Net unrealized appreciation ............................... $ 24,358,698
============
(a) Non-income producing security.
(b) Depositary receipts.
(c) Convertible security.
(d) Represents the current yield as of October 31, 2006.
(e) Represents a zero-coupon bond.
(f) The security may be offered and sold to "qualified institutional buyers"
under Rule 144A of the Securities Act of 1933.
(g) Investments in companies considered to be an affiliate of the Fund, for
purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as
follows:
--------------------------------------------------------------------------
Net Interest
Affiliate Activity Income
--------------------------------------------------------------------------
BlackRock Liquidity Series, LLC
Cash Sweep Series I $12,236,629 $694,755
--------------------------------------------------------------------------
(h) All or a portion of security held as collateral in connection with open
financial futures contracts.
o For Fund compliance purposes, the Fund's industry classifications refer to
any one or more of the industry sub-classifications used by one or more
widely recognized market indexes or ratings group indexes, and/or as
defined by Fund management. This definition may not apply for purposes of
this report, which may combine industry sub-classifications for reporting
ease. Industries are shown as a percent of net assets. These industry
classifications are unaudited.
o Swaps entered into as of October 31, 2006 were as follows:
Unrealized
Notional Appreciation
Amount (Depreciation)
-------------------------------------------------------------------------
Bought credit default protection on
DaimlerChrysler NA Holding Corp. and
pay 0.53%
Broker, JPMorgan Chase
Expires June 2011 $160,000 $ (499)
Bought credit default protection on
Carnival Corp. and pay 0.25%
Broker, JPMorgan Chase
Expires September 2011 $310,000 818
Bought credit default protection on
Whirlpool Corp. and pay 0.48%
Broker, JPMorgan Chase
Expires September 2011 $103,000 (837)
Bought credit default protection on
McDonald's Corp. and pay 0.16%
Broker, JPMorgan Chase
Expires September 2011 $103,000 (115)
Bought credit default protection on
JC Penney Co., Inc. and pay 0.53%
Broker, JPMorgan Chase
Expires September 2011 $103,000 (407)
-------------------------------------------------------------------------
Total $ (1,040)
============
o Financial futures contracts purchased as of October 31, 2006 were as
follows:
--------------------------------------------------------------------------------------------------
Unrealized
Number of Expiration Face Appreciation
Contracts Issue Exchange Date Value (Depreciation)
--------------------------------------------------------------------------------------------------
6 Dax Index 25 Euro Eurex December
Deutschland 2006 $ 1,157,474 $ 47,393
55 DJ Euro Stoxx Eurex December
Deutschland 2006 2,719,938 96,363
19 FTSE 100 Index LIFFE December
2006 2,157,200 68,340
20 MSCI Singapore Singapore November
IX Ets 2006 852,879 (13,208)
44 S&P 500 Index Chicago December
2006 14,714,375 500,827
33 S&P TSE 60 Index Montreal December
2006 3,930,578 212,972
10 SPI 200 Index Sydney December
2006 998,614 39,205
24 MSCI Singapore November
Taiwan Index 2006 707,952 (8,832)
52 TOPIX Index Tokyo December
2006 7,173,755 115
--------------------------------------------------------------------------------------------------
Total Unrealized Appreciation--Net $ 943,175
============
o Currency Abbreviations:
HKD Hong Kong Dollar
USD U.S. Dollar
See Notes to Financial Statements.
20 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Statement of Assets and Liabilities
As of October 31, 2006
===================================================================================================================================
Assets
- -----------------------------------------------------------------------------------------------------------------------------------
Investments in unaffiliated securities, at value (identified cost--$261,780,963) $ 287,887,987
Investments in affiliated securities, at value (identified cost--$12,236,629) ... 12,236,629
Options purchased, at value (premiums paid--$1,479) ............................. 3,740
Unrealized appreciation on swaps ................................................ 818
Foreign cash (cost--$30,539) .................................................... 30,593
Cash on deposit for financial futures contracts ................................. 776,595
Receivables:
Beneficial interest sold ..................................................... $ 1,384,202
Dividends .................................................................... 307,826
Securities sold .............................................................. 240,385
Options ...................................................................... 111,811
Interest ..................................................................... 7,594 2,051,818
---------------
Prepaid expenses ................................................................ 62,883
---------------
Total assets .................................................................... 303,051,063
---------------
===================================================================================================================================
Liabilities
- -----------------------------------------------------------------------------------------------------------------------------------
Options written, at value (premiums received--$1,624,604) ....................... 2,570,478
Bank overdraft .................................................................. 93,998
Unrealized depreciation on swaps ................................................ 1,858
Deferred foreign capital gain tax ............................................... 352,210
Payables:
Securities purchased ......................................................... 3,312,385
Beneficial interest redeemed ................................................. 468,830
Investment adviser ........................................................... 213,457
Distributor .................................................................. 118,695
Variation margin ............................................................. 14,224
Other affiliates ............................................................. 1,854
Swaps ........................................................................ 356 4,129,801
---------------
Accrued expenses and other liabilities .......................................... 207,826
---------------
Total liabilities ............................................................... 7,356,171
---------------
===================================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets ...................................................................... $ 295,694,892
===============
===================================================================================================================================
Net Assets Consist of
- -----------------------------------------------------------------------------------------------------------------------------------
Institutional Shares of beneficial interest, $.10 par value, unlimited shares of
beneficial interest authorized ................................................. $ 892,669
Investor A Shares of beneficial interest, $.10 par value, unlimited shares of
beneficial interest authorized ................................................. 555,794
Investor B Shares of beneficial interest, $.10 par value, unlimited shares of
beneficial interest authorized ................................................. 154,405
Investor C Shares of beneficial interest, $.10 par value, unlimited shares of
beneficial interest authorized ................................................. 865,811
Paid-in capital in excess of par ................................................ 260,601,872
Undistributed investment income--net ............................................ $ 1,476,620
Undistributed realized capital gains--net ....................................... 5,393,753
Unrealized appreciation--net .................................................... 25,753,968
---------------
Total accumulated earnings--net ................................................. 32,624,341
---------------
Net Assets ...................................................................... $ 295,694,892
===============
===================================================================================================================================
Net Asset Value
- -----------------------------------------------------------------------------------------------------------------------------------
Institutional--Based on net assets of $107,419,043 and 8,926,688 shares of
beneficial interest outstanding ................................................ $ 12.03
===============
Investor A--Based on net assets of $66,714,437 and 5,557,935 shares of
beneficial interest outstanding ................................................ $ 12.00
===============
Investor B--Based on net assets of $18,394,661 and 1,544,053 shares of
beneficial interest outstanding ................................................ $ 11.91
===============
Investor C--Based on net assets of $103,166,751 and 8,658,108 shares of
beneficial interest outstanding ................................................ $ 11.92
===============
See Notes to Financial Statements.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 21
Statement of Operations
For the Period November 4, 2005+ to October 31, 2006
===================================================================================================================================
Investment Income
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends (net of $213,978 foreign withholding tax) ............................. $ 4,067,340
Interest (including $694,755 from affiliates) ................................... 843,974
---------------
Total income .................................................................... 4,911,314
---------------
===================================================================================================================================
Expenses
- -----------------------------------------------------------------------------------------------------------------------------------
Investment advisory fees ........................................................ $ 1,721,900
Service and distribution fees--Investor C ....................................... 706,968
Offering costs .................................................................. 215,941
Custodian fees .................................................................. 199,239
Service and distribution fees--Investor B ....................................... 151,891
Service fees--Investor A ........................................................ 132,223
Accounting services ............................................................. 108,881
Registration fees ............................................................... 55,062
Transfer agent fees--Investor C ................................................. 54,323
Trustees' fees and expenses ..................................................... 44,637
Transfer agent fees--Institutional .............................................. 40,657
Transfer agent fees--Investor A ................................................. 34,078
Printing and shareholder reports ................................................ 22,238
Professional fees ............................................................... 18,359
Pricing fees .................................................................... 12,751
Transfer agent fees--Investor B ................................................. 11,825
Other ........................................................................... 24,083
---------------
Total expenses .................................................................. 3,555,056
---------------
Investment income--net .......................................................... 1,356,258
---------------
===================================================================================================================================
Realized & Unrealized Gain (Loss)--Net
- -----------------------------------------------------------------------------------------------------------------------------------
Realized gain (loss) on:
Investments--net (including $39,933 foreign capital gain tax and $61,176
increase from payment by affiliate in order to resolve a regulatory issue
relating to an investment) .................................................. 4,362,212
Financial futures contracts--net ............................................. 1,060,423
Option written--net .......................................................... (68,080)
Swaps--net ................................................................... (735)
Foreign currency transactions--net ........................................... 135,948 5,489,768
---------------
Unrealized appreciation/depreciation on:
Investments--net (including $352,210 deferred foreign capital gain tax) ...... 25,757,075
Financial futures contracts--net ............................................. 943,175
Options written--net ......................................................... (945,874)
Swaps--net ................................................................... (1,040)
Foreign currency transactions--net ........................................... 632 25,753,968
----------------------------------
Total realized and unrealized gain--net ......................................... 31,243,736
---------------
Net Increase in Net Assets Resulting from Operations ............................ $ 32,599,994
===============
+ Commencement of operations.
See Notes to Financial Statements.
22 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Statement of Changes in Net Assets
For the Period
November 4, 2005+
to October 31,
Increase (Decrease) in Net Assets: 2006
===================================================================================================================================
Operations
- -----------------------------------------------------------------------------------------------------------------------------------
Investment income--net ............................................................................. $ 1,356,258
Realized gain--net ................................................................................. 5,489,768
Unrealized appreciation--net ....................................................................... 25,753,968
---------------
Net increase in net assets resulting from operations ............................................... 32,599,994
---------------
===================================================================================================================================
Dividends to Shareholders
- -----------------------------------------------------------------------------------------------------------------------------------
Investment income--net:
Institutional ................................................................................... (48,822)
Investor A ...................................................................................... (64,464)
Investor B ...................................................................................... (16,793)
Investor C ...................................................................................... (64,924)
---------------
Net decrease in net assets resulting from dividends to shareholders ................................ (195,003)
---------------
===================================================================================================================================
Beneficial Interest Transactions
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets derived from beneficial interest transactions ........................... 263,175,017
---------------
===================================================================================================================================
Redemption Fees
- -----------------------------------------------------------------------------------------------------------------------------------
Redemption fees .................................................................................... 14,884
---------------
===================================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------------------------
Total increase in net assets ....................................................................... 295,594,892
Beginning of period ................................................................................ 100,000
---------------
End of period* ..................................................................................... $ 295,694,892
===============
* Undistributed investment income--net .......................................................... $ 1,476,620
===============
+ Commencement of operations.
See Notes to Financial Statements.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 23
Financial Highlights
For the Period November 4, 2005+ to October 31, 2006
The following per share data and ratios have been derived ----------------------------------------------------------------------
from information provided in the financial statements. Institutional Investor A Investor B Investor C
====================================================================================================================================
Per Share Operating Performance
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ........... $ 10.00 $ 10.00 $ 10.00 $ 10.00
--------------------------------------------------------------------
Investment income--net** ....................... .12 .10 .02 .02
Realized and unrealized gain--net*** ........... 1.93 1.92 1.91 1.92
--------------------------------------------------------------------
Total from investment operations ............... 2.05 2.02 1.93 1.94
--------------------------------------------------------------------
Less dividends from investment income--net ..... (.02) (.02) (.02) (.02)
--------------------------------------------------------------------
Net asset value, end of period ................. $ 12.03 $ 12.00 $ 11.91 $ 11.92
====================================================================
====================================================================================================================================
Total Investment Return++
- ------------------------------------------------------------------------------------------------------------------------------------
Based on net asset value per share ............. 20.51%@**** 20.21%@**** 19.31%@**** 19.41%@****
====================================================================
====================================================================================================================================
Ratios to Average Net Assets*
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses ....................................... 1.26% 1.51% 2.27% 2.27%
====================================================================
Investment income--net ......................... 1.14% .93% .18% .16%
====================================================================
====================================================================================================================================
Supplemental Data
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ....... $107,419 $ 66,714 $ 18,395 $103,167
====================================================================
Portfolio turnover ............................. 37.53% 37.53% 37.53% 37.53%
====================================================================
* Annualized.
** Based on average shares outstanding.
*** Includes redemption fee, which is less than $.01 per share.
**** In 2006, approximately +.03% of the Fund's total investment return
consisted of a payment by Fund Asset Management, L.P. in order to resolve
a regulatory issue relating to an investment.
+ Commencement of operations.
++ Total investment return excludes the effects of sales charges. Effective
December 28, 2005, Institutional Shares are no longer subject to any
front-end sales charge.
@ Aggregate total investment return.
See Notes to Financial Statements.
24 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Notes to Financial Statements
1. Significant Accounting Policies:
On September 29, 2006, Merrill Lynch Global Equity Opportunities Fund was
renamed BlackRock Global Dynamic Equity Fund (the "Fund"). The Fund is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. Prior to commencement of
operations on November 4, 2005, the Fund had no operations other than those
relating to organizational matters and the issue of the 10,000 shares of
beneficial interest of the Fund to Fund Asset Management, L.P. ("FAM") for
$100,000. The Fund's financial statements are prepared in conformity with U.S.
generally accepted accounting principles, which may require the use of
management accruals and estimates. Actual results may differ from these
estimates. The Fund offers multiple classes of shares. Effective October 2,
2006, Class I, Class A, Class B and Class C Shares were redesignated
Institutional, Investor A, Investor B and Investor C Shares, respectively.
Institutional Shares are sold without a sales charge and only to certain
eligible investors. Investor A Shares are sold with a front-end sales charge.
Shares of Investor B and Investor C may be subject to a contingent deferred
sales charge. All classes of shares have identical voting, dividend, liquidation
and other rights and the same terms and conditions, except that Investor A,
Investor B, and Investor C Shares bear certain expenses related to the account
maintenance of such shares, and Investor B and Investor C Shares also bear
certain expenses related to the distribution of such shares. Each class has
exclusive voting rights with respect to matters relating to its account
maintenance and distribution expenditures (except that Investor B shareholders
may vote on material changes to the Investor A distribution plan). Income,
expenses (other than expenses attributable to a specific class) and realized and
unrealized gains and losses are allocated daily to each class based on its
relative net assets. The following is a summary of significant accounting
policies followed by each Fund.
(a) Valuation of investments -- Equity securities held by the Fund that are
traded on stock exchanges or the Nasdaq National Market are valued at the last
sale price or official close price on the exchange, as of the close of business
on the day the securities are being valued or, lacking any sales, at the last
available bid price for long positions, and at the last available asked price
for short positions. In cases where equity securities are traded on more than
one exchange, the securities are valued on the exchange designated as the
primary market by or under the authority of the Board of Trustees of the Fund.
Debt securities are traded primarily in the over-the-counter markets ("OTC") and
are valued at the last available bid price in the OTC market or on the basis of
values obtained by a pricing service. Pricing services use valuation matrixes
that incorporate both dealer-supplied valuations and valuation models. The
procedures of the pricing service and its valuations are reviewed by the
officers of the Fund under the general direction of the Board of Trustees. Such
valuations and procedures will be reviewed periodically by the Board of Trustees
of the Fund. Long positions traded in the OTC markets, Nasdaq Small Cap or
Bulletin Board are valued at the last available bid price or yield equivalent
obtained from one or more dealers or pricing services approved by the Board of
Trustees of the Fund. Short positions traded in the OTC markets are valued at
the last available asked price. Portfolio securities that are traded both in OTC
markets and on a stock exchange are valued according to the broadest and most
representative market.
Options written are valued at the last sale price in the case of exchange-traded
options or, in the case of options traded in the OTC market, the last asked
price. Options purchased are valued at their last sale price in the case of
exchange-traded options or, in the case of options traded in the OTC market, the
last bid price. Swap agreements are valued based upon quoted fair valuations
received daily by the Fund from a pricing service or counterparty. Financial
futures contracts and options thereon, which are traded on exchanges, are valued
at their last sale price as of the close of such exchanges. Obligations with
remaining maturities of 60 days or less are valued at amortized cost unless the
Manager believes that this method no longer produces fair valuations. Valuation
of other short-term investment vehicles is generally based on net asset value of
the underlying investment vehicle or amortized cost.
Repurchase agreements are valued at cost plus accrued interest. The Fund employs
pricing services to provide certain securities prices for the Fund. Securities
and assets for which market quotations are not readily available are valued at
fair value as determined in good faith by or under the direction of the Board of
Trustees of the Fund, including valuations furnished by the pricing services
retained by the Fund, which may use a matrix system for valuations. The
procedures of a pricing service and its valuations are reviewed by the officers
of the Fund under the general supervision of the Fund's Board of Trustees. Such
valuations and procedures will be reviewed periodically by the Board of Trustees
of the Fund.
Generally, trading in foreign securities, as well as U.S. government securities,
money market instruments and certain fixed income securities, is substantially
completed each day at various times prior to the close of business on the New
York Stock Exchange ("NYSE"). The values of such securities used
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 25
Notes to Financial Statements (continued)
in computing the net asset value of the Fund's shares are determined as of such
times. Foreign currency exchange rates will be determined as of the close of
business on the NYSE. Occasionally, events affecting the values of such
securities and such exchange rates may occur between the times at which they are
determined and the close of business on the NYSE that may not be reflected in
the computation of the Fund's net asset value. If events (for example, a company
announcement, market volatility or a natural disaster) occur during such periods
that are expected to materially affect the value of such securities, those
securities will be valued at their fair value as determined in good faith by the
Fund's Board of Trustees or by the Manager using a pricing service and/or
procedures approved by the Fund's Board of Trustees.
(b) Foreign currency transactions -- Transactions denominated in foreign
currencies are recorded at the exchange rate prevailing when recognized. Assets
and liabilities denominated in foreign currencies are valued at the exchange
rate at the end of the period. Foreign currency transactions are the result of
settling (realized) or valuing (unrealized) assets or liabilities expressed in
foreign currencies into U.S. dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on investments.
The Fund invests in foreign securities, which may involve a number of risk
factors and special considerations not present with investments in securities of
U.S. corporations.
(c) Derivative financial instruments -- The Fund may engage in various portfolio
investment strategies both to increase the return of the Fund and to hedge, or
protect, its exposure to interest rate movements and movements in the securities
markets. Losses may arise due to changes in the value of the contract or if the
counterparty does not perform under the contract.
o Forward foreign exchange contracts -- The Fund may enter into forward
foreign exchange contracts as a hedge against either specific transactions
or portfolio positions. The contract is marked-to-market daily and the
change in market value is recorded by the Fund as an unrealized gain or
loss. When the contract is closed, the Fund records a realized gain or
loss equal to the difference between the value at the time it was opened
and the value at the time it was closed.
o Foreign currency options and futures -- The Fund may purchase or sell
listed or OTC foreign currency options, foreign currency futures and
related options on foreign currency futures as a short or long hedge
against possible variations in foreign exchange rates. Such transactions
may be effected with respect to hedges on non-U.S. dollar denominated
securities owned by the Fund, sold by the Fund but not yet delivered, or
committed or anticipated to be purchased by the Fund.
o Options -- The Fund may purchase and write covered call and put options.
When the Fund writes an option, an amount equal to the premium received by
the Fund is reflected as an asset and an equivalent liability. The amount
of the liability is subsequently marked-to-market to reflect the current
value of the option written. When a security is purchased or sold through
an exercise of an option, the related premium paid (or received) is added
to (or deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option expires
(or the Fund enters into a closing transaction), the Fund realizes a gain
or loss on the option to the extent of the premiums received or paid (or
gain or loss to the extent the cost of the closing transaction exceeds the
premium paid or received).
Written and purchased options are non-income producing investments.
o Financial futures contracts -- The Fund may purchase or sell financial
futures contracts and options on such financial futures contracts.
Financial futures contracts are contracts for delayed delivery of
securities at a specific future date and at a specific price or yield.
Upon entering into a contract, the Fund deposits and maintains as
collateral such initial margin as required by the exchange on which the
transaction is effected. 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 value of the contract. Such receipts or payments are known
as variation margin and are recorded by the Fund as unrealized gains or
losses. When the contract is closed, the Fund records a realized gain or
loss equal to the difference between the value of the contract at the time
it was opened and the value at the time it was closed.
o Swaps -- The Fund may enter into swap agreements, which are OTC contracts
in which the Fund and a counterparty agree to make periodic net payments
on a specified notional amount. The net payments can be made for a set
period of time or may be triggered by a predetermined credit event. The
net periodic payments may be based on a fixed or variable interest rate;
the change in market value of a specified security, basket of securities,
26 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Notes to Financial Statements (continued)
or index; or the return generated by a security. These periodic payments
received or made by the Fund are recorded in the accompanying Statements
of Operations as realized gains or losses, respectively. Gains or losses
are also realized upon termination of the swap agreements. Swaps are
marked-to-market daily and changes in value are recorded as unrealized
appreciation (depreciation). Risks include changes in the returns of the
underlying instruments, failure of the counterparties to perform under the
contracts' terms and the possible lack of liquidity with respect to the
swap agreements.
(d) Income taxes -- It is the Fund's policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required. Under the applicable
foreign tax law, a withholding tax may be imposed on interest, dividends and
capital gains at various rates.
(e) Security transactions and investment income -- Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Realized gains and losses on security transactions are determined on the
identified cost basis. Dividend income is recorded on the ex-dividend dates.
Dividends from foreign securities where the ex-dividend date may have passed are
subsequently recorded when the Fund has determined the ex-dividend date.
Interest income is recognized on the accrual basis. The Fund amortizes all
premiums and discounts on debt securities.
(f) Offering costs -- Offering costs are amortized over a 12-month period
beginning with the commencement of operations of the Fund.
(g) Dividends and distributions -- Dividends and distributions paid by the Fund
are recorded on the ex-dividend dates.
(h) Securities lending -- The Fund may lend securities to financial institutions
that provide cash or securities issued or guaranteed by the U.S. government as
collateral, which will be maintained at all times in an amount equal to at least
100% of the current market value of the loaned securities. The market value of
the loaned securities is determined at the close of business of the Fund and any
additional required collateral is delivered to the Fund on the next business
day. Where the Fund receives securities as collateral for the loaned securities,
it collects a fee from the borrower. The Fund typically receives the income on
the loaned securities but does not receive the income on the collateral. Where
the Fund receives cash collateral, it may invest such collateral and retain the
amount earned on such investment, net of any amount rebated to the borrower.
Loans of securities are terminable at any time and the borrower, after notice,
is required to return borrowed securities within five business days. The Fund
may pay reasonable finder's, lending agent, administrative and custodial fees in
connection with its loans. In the event that the borrower defaults on its
obligation to return borrowed securities because of insolvency or for any other
reason, the Fund could experience delays and costs in gaining access to the
collateral. The Fund also could suffer a loss where the value of the collateral
falls below the market value of the borrowed securities, in the event of
borrower default or in the event of losses on investments made with cash
collateral.
(i) Bank overdraft -- The Fund recorded a bank overdraft, which resulted from
management estimates of available cash.
(j) Recent accounting pronouncements -- In July 2006, the Financial Accounting
Standards Board ("FASB") issued Interpretation No. 48 ("FIN 48"), "Accounting
for Uncertainty in Income Taxes -- an interpretation of FASB Statement No. 109."
FIN 48 prescribes the minimum recognition threshold a tax position must meet in
connection with accounting for uncertainties in income tax positions taken or
expected to be taken by an entity including mutual funds before being measured
and recognized in the financial statements. Adoption of FIN 48 is required for
fiscal years beginning after December 15, 2006. The impact on the Fund's
financial statements, if any, is currently being assessed.
In addition, in September 2006, Statement of Financial Accounting Standards No.
157, "Fair Value Measurements" ("FAS 157"), was issued and is effective for
fiscal years beginning after November 15, 2007. FAS 157 defines fair value,
establishes a framework for measuring fair value and expands disclosures about
fair value measurements. Management is currently evaluating the implication of
FAS 157. At this time its impact on the Fund's financial statements has not been
determined.
(k) Reclassifications -- U.S. generally accepted accounting principles require
that certain components of net assets be adjusted to reflect permanent
differences between financial and tax reporting. Accordingly, during the current
year, $219,350 has been reclassified between paid-in capital in excess of par
and undistributed net investment income and $96,015 has been reclassified
between undistributed net realized capital gains and undistributed net
investment income as a result of permanent differences attributable to
non-deductible expenses, foreign currency transactions and
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 27
Notes to Financial Statements (continued)
foreign taxes paid. These reclassifications have no effect on net assets or net
asset values per share.
2. Investment Advisory Agreement and Transactions with Affiliates:
On September 29, 2006, BlackRock, Inc. and Merrill Lynch & Co., Inc. ("Merrill
Lynch") combined Merrill Lynch's investment management business, Merrill Lynch
Investment Managers, L.P. ("MLIM"), and its affiliates, including FAM, with
BlackRock, Inc. to create a new independent company. Merrill Lynch has a 49.8%
economic interest and a 45% voting interest in the combined company and The PNC
Financial Services Group, Inc. ("PNC"), has approximately a 34% economic and
voting interest. The new company operates under the BlackRock name and is
governed by a board of directors with a majority of independent members.
On August 15, 2006, shareholders of the Fund approved a new Investment Advisory
Agreement with BlackRock Advisors, Inc. (the "Manager"), an indirect, wholly
owned subsidiary of BlackRock, Inc. BlackRock Advisors, Inc. was recently
reorganized into a limited liability company and renamed BlackRock Advisors,
LLC. The new Investment Advisory Agreement between the Fund and the Manager
became effective on September 29, 2006. Prior to September 29, 2006, FAM was the
Investment Adviser. The general partner of FAM is Princeton Services, Inc.
("PSI"), an indirect, wholly owned subsidiary of Merrill Lynch, which is the
limited partner. The Fund has also entered into a separate Distribution
Agreement and Distribution Plans with FAM Distributors, Inc. ("FAMD") and
BlackRock Distributors, Inc. ("BDI") (collectively, the "Distributor"). FAMD is
a wholly owned subsidiary of Merrill Lynch Group, Inc. and BDI is an affiliate
of BlackRock, Inc.
The Manager is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain other
services necessary to the operations of the Fund. For such services, the Fund
pays a monthly fee of .85%, on an annual basis, of the average daily value of
the Fund's net assets. In addition, the Manager has entered into sub-advisory
agreements with both BlackRock Investment Management, LLC ("BIM") and BlackRock
Asset Management U.K. Limited, both affiliates of the Manager, under which the
Manager pays each Sub-Adviser for services it provides a fee equal to 37% of the
management fee paid by the Fund to the Manager. Prior to September 29, 2006, FAM
had a Sub-Advisory Agreement with Merrill Lynch Asset Management U.K. Limited
("MLAM U.K."), an affiliate of FAM.
Pursuant to the Distribution Plans adopted by the Fund in accordance with Rule
12b-1 under the Investment Company Act of 1940, the Fund pays the Distributor
ongoing account maintenance fees ("service fees") and distribution fees. The
fees are accrued daily and paid monthly at annual rates based upon the average
daily net assets of the shares as follows:
- --------------------------------------------------------------------------------
Service Distribution
Fee Fee
- --------------------------------------------------------------------------------
Investor A ....................................... .25% --
Investor B ....................................... .25% .75%
Investor C ....................................... .25% .75%
- --------------------------------------------------------------------------------
Pursuant to sub-agreements with each Distributor, broker-dealers, including
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S"), a wholly owned
subsidiary of Merrill Lynch, and an affiliate of each of the Distributors, also
provide service fees and distribution services to the Fund. The ongoing service
fee compensates the Distributors and each broker-dealer (including MLPF&S) for
providing account maintenance services to Investor A, Investor B and Investor C
shareholders. The ongoing distribution fee compensates the Distributors and the
broker-dealers for providing shareholder and distribution-related services to
Investor B and Investor C shareholders.
For the period November 4, 2005 to October 31, 2006, FAMD, the Fund's sole
Distributor until September 29, 2006, earned underwriting discounts and direct
commissions and MLPF&S earned dealer concessions on sales of the Fund's
Institutional and Investor A Shares as follows:
- --------------------------------------------------------------------------------
FAMD MLPF&S
- --------------------------------------------------------------------------------
Institutional .............................. $ 422 $ 2,750
Investor A ................................. $ 131,445 $1,637,378
- --------------------------------------------------------------------------------
For the period November 4, 2005 to October 31, 2006, FAMD paid MLPF&S contingent
deferred sales charges of $1,992 and $21,727 relating to transactions in
Investor B and Investor C Shares, respectively.
BlackRock maintains a call center, which is responsible for providing certain
shareholder services to the Fund, such as responding to shareholder inquiries
and processing transactions based upon instructions from shareholders with
respect to the subscription and redemption of Fund shares. During the period
September 29, 2006 to October 31, 2006, the following amounts have been accrued
by the Fund to reimburse BlackRock for costs incurred running the call center,
which are a component of the transfer agent fees in the accompanying Statement
of Operations.
28 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Notes to Financial Statements (continued)
- --------------------------------------------------------------------------------
Call Center Fees
- --------------------------------------------------------------------------------
Institutional ...................................................... $ 54
Investor A ......................................................... $ 77
Investor B ......................................................... $ 23
Investor C ......................................................... $116
- --------------------------------------------------------------------------------
The Fund has received an exemptive order from the Securities and Exchange
Commission permitting it to lend portfolio securities to MLPF&S or its
affiliates. Pursuant to that order, the Fund also has retained BIM, an affiliate
of the Manager, as the securities lending agent for a fee based on a share of
the returns on investment of cash collateral. Prior to September 29, 2006, BIM
was organized as Merrill Lynch Investment Managers, LLC ("MLIM, LLC"), an
affiliate of FAM and MLIM, LLC was the security lending agent. BIM may, on
behalf of the Fund, invest cash collateral received by the Fund for such loans,
among other things, in a private investment company managed by the Manager or in
registered money market funds advised by the Manager or its affiliates.
FAM reimbursed the Fund $61,176 in order to resolve a regulatory issue relating
to an investment.
In addition, MLPF&S received $58,222 in commissions on the execution of
portfolio security transactions for the Fund for the period November 4, 2005 to
October 31, 2006.
Effective September 29, 2006, PFPC, Inc., an indirect, wholly owned subsidiary
of PNC and an affiliate of the Manager, became the Fund's transfer agent. Prior
to September 29, 2006, the Fund's transfer agent was Financial Data Services,
Inc. ("FDS"), a wholly owned subsidiary of Merrill Lynch.
For the period November 4, 2005 to October 31, 2006, the Fund reimbursed FAM and
the Manager $3,793 and $387 respectively, for certain accounting services.
Prior to September 29, 2006, certain officers and/or trustees of the Fund were
officers and/or directors of FAM, PSI, MLAM U.K., FDS, FAMD, Merrill Lynch,
and/or MLIM, LLC.
Commencing September 29, 2006, certain officers and/or trustees of the Fund are
officers and/or directors of BlackRock, Inc. or its affiliates.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the
period November 4, 2005 to October 31, 2006, were $330,045,660 and $72,719,485,
respectively.
Transactions in call options written for the period November 4, 2005+ to October
31, 2006 were as follows:
- -------------------------------------------------------------------------------
Number of Premiums
Contracts Received
- -------------------------------------------------------------------------------
Outstanding call options written, beginning of period -- --
Options written ..................................... 7,157 $ 1,994,098
Options exercised ................................... (82) (16,676)
Options expired ..................................... (16) (11,530)
Options closed ...................................... (975) (341,288)
------------------------
Outstanding call options written, end of period ..... 6,084 $ 1,624,604
========================
Transactions in put options written for the period November 4, 2005+ to October
31, 2006 were as follows:
- -------------------------------------------------------------------------------
Number of Premiums
Contracts Received
- -------------------------------------------------------------------------------
Outstanding put options written, beginning of period -- --
Options written .................................... 34 $ 36,304
Options expired .................................... (34) (36,304)
-----------------------
Outstanding put options written, end of period ..... -- $ --
=======================
+ Commencement of operations.
4. Beneficial Interest Transactions:
Net increase in net assets derived from beneficial interest transactions was
$263,175,017 for the period November 4, 2005 to October 31, 2006.
Transactions in beneficial interest for each class were as follows:
- -------------------------------------------------------------------------------
Institutional Shares for the Period Dollar
Nov. 4, 2005+ to Oct. 31, 2006 Shares Amount
- -------------------------------------------------------------------------------
Shares sold ................................ 9,718,591 $ 105,011,388
Shares issued to shareholders in
reinvestment of dividends ................ 4,279 44,541
-------------------------------
Total issued ............................... 9,722,870 105,055,929
Shares redeemed ............................ (798,682) (8,895,400)
-------------------------------
Net increase ............................... 8,924,188 $ 96,160,529
===============================
+ Prior to November 4, 2005 (commencement of operations), the Fund issued
2,500 shares to FAM for $25,000.
- -------------------------------------------------------------------------------
Investor A Shares for the Period Dollar
Nov. 4, 2005+ to Oct. 31, 2006 Shares Amount
- -------------------------------------------------------------------------------
Shares sold ................................ 6,540,964 $ 68,913,138
Shares issued to shareholders in
reinvestment of dividends ................ 5,477 57,011
-------------------------------
Total issued ............................... 6,546,441 68,970,149
Shares redeemed ............................ (991,006) (10,951,407)
-------------------------------
Net increase ............................... 5,555,435 $ 58,018,742
===============================
+ Prior to November 4, 2005 (commencement of operations), the Fund issued
2,500 shares to FAM for $25,000.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 29
Notes to Financial Statements (concluded)
- -------------------------------------------------------------------------------
Investor B Shares for the Period Dollar
Nov. 4, 2005+ to Oct. 31, 2006 Shares Amount
- -------------------------------------------------------------------------------
Shares sold ................................ 1,820,428 $ 19,213,369
Shares issued to shareholders in
reinvestment of dividends ................ 1,370 14,251
-------------------------------
Total issued ............................... 1,821,798 19,227,620
Shares redeemed ............................ (280,245) (3,168,311)
-------------------------------
Net increase ............................... 1,541,553 $ 16,059,309
===============================
+ Prior to November 4, 2005 (commencement of operations), the Fund issued
2,500 shares to FAM for $25,000.
- -------------------------------------------------------------------------------
Investor C Shares for the Period Dollar
Nov. 4, 2005+ to Oct. 31, 2006 Shares Amount
- -------------------------------------------------------------------------------
Shares sold ................................ 9,288,328 $ 99,958,030
Shares issued to shareholders in
reinvestment of dividends ................ 5,454 56,719
-------------------------------
Total issued ............................... 9,293,782 100,014,749
Shares redeemed ............................ (638,174) (7,078,312)
-------------------------------
Net increase ............................... 8,655,608 $ 92,936,437
===============================
+ Prior to November 4, 2005 (commencement of operations), the Fund issued
2,500 shares to FAM for $25,000.
The Fund charges a 2% redemption fee on the proceeds (calculated at market
value) of a redemption (either by sale or exchange) of Fund shares made within
30 days of purchase. The redemption fee is paid to the Fund and is intended to
offset the trading costs, market impact and other costs associated with
short-term trading into and out of the Fund.
5. Short-Term Borrowings:
The Fund, along with certain other funds managed by the Manager and its
affiliates, is a party to a $500,000,000 credit agreement with a group of
lenders, which expires November 2006, and was subsequently renewed for one year
under substantially the same terms. The Fund may borrow under the credit
agreement to fund shareholder redemptions and for other lawful purposes other
than for leverage. The Fund may borrow up to the maximum amount allowable under
the Fund's current prospectus and statement of additional information, subject
to various other legal, regulatory or contractual limits. The Fund pays a
commitment fee of .07% per annum based on the Fund's pro rata share of the
unused portion of the credit agreement. Amounts borrowed under the credit
agreement bear interest at a rate equal to, at each fund's election, the federal
funds rate plus .50% or a base rate as defined in the credit agreement. The Fund
did not borrow under the credit agreement during the period November 23, 2005 to
October 31, 2006.
6. Commitments:
At October 31, 2006, the Fund had entered into foreign exchange contracts, under
which it had agreed to purchase and sell various foreign currencies with an
approximate value of $314,000 and $169,000, respectively.
7. Distribution to Shareholders:
The tax character of distributions paid during the period November 4, 2005 to
October 31, 2006 was as follows:
- --------------------------------------------------------------------------------
11/04/2005+ to
10/31/2006
- --------------------------------------------------------------------------------
Distributions paid from:
Ordinary income .............................................. $195,003
--------
Total taxable distributions .................................... $195,003
========
+ Commencement of operations.
As of October 31, 2006, the components of accumulated earnings on a tax basis
were as follows:
- -------------------------------------------------------------------------------
Undistributed ordinary income -- net ........................... $ 8,061,979
Undistributed long-term capital gains -- net ................... 159,801
-----------
Total undistributed earnings -- net ............................ 8,221,780
Capital loss carryforward ...................................... --
Unrealized gains -- net ........................................ 24,402,561*
-----------
Total accumulated earnings -- net .............................. $32,624,341
===========
* The difference between book-basis and tax-basis net unrealized gains is
attributable primarily to the tax deferral of losses on wash sales, the
tax deferral of losses on straddles, the realization for tax purposes of
unrealized gains (losses) on certain futures and foreign currency
contracts, the realization for tax purposes of unrealized gains on
investments in passive foreign investment companies and other book/tax
temporary differences.
8. Plan of Reorganization:
On November 30, 2006, the Fund's Trustees approved a plan of reorganization,
whereby the Fund will acquire substantially all of the assets and assume
substantially all of the liabilities of BlackRock Global Value Fund, Inc. in
exchange for newly issued shares of the Fund, subject to that Fund's
shareholders' approval and certain other conditions.
30 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees of BlackRock Global Dynamic Equity
Fund:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of BlackRock Global Dynamic Equity Fund (formerly
Merrill Lynch Global Equity Opportunities Fund) as of October 31, 2006, and the
related statements of operations and of changes in net assets, and the financial
highlights for the period November 4, 2005 (commencement of operations) through
October 31, 2006. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. The Fund
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of October 31, 2006, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. We believe that our audit provides a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
BlackRock Global Dynamic Equity Fund as of October 31, 2006, the results of its
operations, the changes in its net assets and its financial highlights for the
period November 4, 2005 through October 31, 2006, in conformity with U.S.
generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
December 21, 2006
Important Tax Information (unaudited)
The following information is provided with respect to the ordinary income
distribution paid by BlackRock Global Dynamic Equity Fund to shareholders of
record on December 12, 2005:
- --------------------------------------------------------------------------------
Qualified Dividend Income for Individuals ........................... 94.28%*
Dividends Qualifying for the Dividends Received
Deduction for Corporations ........................................ 49.81%*
- --------------------------------------------------------------------------------
* The Fund hereby designates the percentage indicated above or the maximum
amount allowable by law.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 31
Disclosure of Investment Advisory Agreement
Disclosure of FAM Management Agreement
The Board of Trustees of the Fund met in May 2006 to consider approval of the
Fund's management agreement with Fund Asset Management, L.P. ("FAM"), the Fund's
manager at that time.
Activities and Composition of the Board
All but one member of the Board is an independent trustee, whose only
affiliation with FAM or other Merrill Lynch affiliates was as a trustee of the
Fund and as a director or trustee of certain other funds advised by FAM or its
affiliates. The Chairman of the Board is also an independent trustee. New
trustee nominees are chosen by a Nominating Committee comprised of independent
trustees. All independent trustees also are members of the Board's Audit
Committee, and the independent trustees meet in executive session at each
in-person Board meeting. The Board and the Audit Committee meet in person for at
least two days each quarter and conduct other in-person and telephone meetings
throughout the year, some of which are formal Board meetings and some of which
are informational meetings. The independent counsel to the independent trustees
attends all in-person Board and Audit Committee meetings and other meetings at
the independent trustees' request.
FAM Management Agreement -- Matters Considered by the Board
Every year, the Board considers approval of the Fund's management agreement and
any sub-advisory agreement. The Board assesses the nature, scope and quality of
the services provided to the Fund by the personnel of the manager, the
sub-adviser and their affiliates, including administrative services, shareholder
services, oversight of fund accounting, marketing services and assistance in
meeting legal and regulatory requirements. The Board also receives and assesses
information regarding the services provided to the Fund by certain unaffiliated
service providers.
At various times throughout the year, the Board also considers a range of
information in connection with its oversight of the services provided by the
manager and its affiliates, including the sub-adviser. Among the matters
considered are: (a) fees (in addition to management fees) paid to the manager
and its affiliates by the Fund, such as transfer agency fees and fees for
marketing and distribution; (b) Fund operating expenses paid to third parties;
(c) the resources devoted to and compliance reports relating to the Fund's
investment objective, policies and restrictions, and the Fund's compliance with
its Code of Ethics and compliance policies and procedures; and (d) the nature,
cost and character of non-investment management services provided by the manager
and its affiliates.
The Board noted its view of FAM as one of the most experienced global asset
management firms and considered the overall services provided by FAM to be of
high quality. The Board also noted its view of FAM as financially sound and well
managed and noted FAM's affiliation with one of America's largest financial
firms. The Board works closely with the manager in overseeing the manager's
efforts to achieve good performance. As part of this effort, the Board discusses
portfolio manager effectiveness and, when performance is not satisfactory,
discusses with the manager taking steps such as changing investment personnel.
Annual Consideration of Approval by the Board
In the period prior to the Board meeting to consider renewal of the management
agreement and any sub-advisory agreement, the Board requests and receives
materials specifically relating to the management agreement and/or sub-advisory
agreement. These materials include (a) information compiled by Lipper Inc.
("Lipper") on the fees and expenses and investment performance of the Fund as
compared to a comparable group of funds as classified by Lipper; (b) sales and
redemption data for the Fund; (c) a discussion by the Fund's portfolio
management team regarding investment strategies used by the Fund during its most
recent fiscal year; (d) information on the profitability to the manager and its
affiliates of the management agreement, the sub-advisory agreement and other
relationships with the Fund; and (e) information provided by the manager
concerning investment advisory fees charged to other clients, such as retail
offshore funds, under similar investment mandates. Since the sub-advisory
services were provided by an affiliate of FAM, and no additional fee is paid for
these services, the Board considered the existing sub-advisory agreement and the
management agreement between the Fund and FAM (the "FAM Management Agreement")
together. The Board also considers other matters it deems important to the
approval process, such as payments made to the manager or its affiliates
relating to the distribution of Fund shares, services related to the valuation
and pricing of Fund portfolio holdings, allocation of fund brokerage fees
(including the related benefits to the manager of "soft dollars"), the Fund's
portfolio turnover statistics, and direct and indirect benefits to the manager,
the sub-adviser and their affiliates from their relationship with the Fund. The
Board did not identify any particular information as controlling, and each
member of the Board may have attributed different weights to the various items
considered.
32 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Certain Specific Renewal Data
In connection with the renewal of the FAM Management Agreement and the
sub-advisory agreement in May 2006, the independent trustees' and the Board's
review included the following:
Services Provided by the Manager -- The Board reviewed the nature, extent and
quality of services provided by FAM and the sub-adviser, including the
investment advisory services and the resulting performance of the Fund. The
Board compared Fund performance -- both including and excluding the effects of
the Fund's fees and expenses -- to the performance of a comparable group of
mutual funds as classified by Lipper and the performance of a relevant index or
combination of indexes. While the Board reviews performance data at least
quarterly, the Board attaches more importance to performance over relatively
long periods of time, typically three to five years. The Board concluded that
the comparative data indicated that the Fund's performance was competitive.
Considering all these factors, the Board concluded that the nature and quality
of the services provided supported the continuation of the FAM Management
Agreement.
FAM's Personnel and Investment Process -- The Board reviewed the Fund's
investment objectives and strategies. The Board discussed with FAM's senior
management responsible for investment operations and the senior management of
FAM's equity investing group the strategies being used to achieve the stated
objectives. Among other things, the Board considered the size, education and
experience of FAM's investment staff, its use of technology, and FAM's approach
to training and retaining portfolio managers and other research, advisory and
management personnel. The Board also reviewed FAM's compensation policies and
practices with respect to the Fund's portfolio manager. The Board also
considered the experience of the Fund's portfolio manager and noted that Mr.
Stattman (the Fund's senior portfolio manager) has more than 20 years of
experience in portfolio management. The Board considered the extensive
experience of FAM and its investment staff in analyzing and managing the types
of investments used by the Fund and concluded that the Fund benefits from that
experience.
Management Fees and Other Expenses -- The Board reviews the Fund's contractual
management fee rate and actual management fee rate as a percentage of total
assets at common asset levels -- the actual rate includes advisory and
administrative service fees and the effects of any fee waivers -- compared to
the other funds in its Lipper category. It also compares the Fund's total
expenses to those of other comparable funds. The Board considered the services
provided to and the fees charged by FAM to other types of clients with similar
investment mandates. The Board determined that the Fund's contractual and actual
management fee rates, as well as total expenses, were competitive with those of
comparable funds. The Board concluded that the Fund's management fee rate and
overall expense ratio were reasonable compared to those of other comparable
funds.
Profitability -- The Board considers the cost of the services provided to the
Fund by the manager and the manager's and its affiliates' profits relating to
the management and distribution of the Fund and the funds advised by the
investment manager and its affiliates. As part of its analysis, the Board
reviewed FAM's methodology in allocating its costs to the management of the Fund
and concluded that there was a reasonable basis for the allocation. The Board
also considered federal court decisions discussing an investment adviser's
profitability and profitability levels considered to be reasonable in those
decisions. The Board concluded that the profits of FAM and its affiliates were
acceptable in relation to the nature and quality of services provided and given
the level of fees and expenses overall.
Economies of Scale -- The Board considered the extent to which economies of
scale might be realized as the assets of the Fund increase and whether there
should be changes in the management fee rate or structure in order to enable the
Fund to participate in these economies of scale. While there was no evidence to
date that the Fund's assets have reached a level where such economies are
effectively available, the Board noted that they would continue to seek
information relating to economies of scale. The Board determined that no changes
were currently necessary.
Conclusion
After the independent trustees deliberated in executive session, the entire
Board, including all of the independent trustees, approved the renewal of the
existing FAM Management Agreement and sub-advisory agreement, concluding that
the management fee rate was reasonable in relation to the services provided and
that a contract renewal was in the best interests of the shareholders.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 33
Disclosure of New Investment Advisory Agreement
New BlackRock Management Agreement -- Matters Considered by the Board
In connection with the combination of Merrill Lynch's investment advisory
business, including Merrill Lynch Investment Managers, L.P. (the "Previous
Manager"), with that of BlackRock, Inc. ("BlackRock") to create a new
independent company ("New BlackRock") (the "Transaction"), the Fund's Board of
Trustees considered and approved a new management agreement (the "BlackRock
Management Agreement") between the Fund and BlackRock Advisors, LLC ("BlackRock
Advisors"). The Fund's shareholders subsequently approved the BlackRock
Management Agreement and it became effective on September 29, 2006, replacing
the management agreement with the Previous Manager (the "Previous Management
Agreement").
The Board discussed the BlackRock Management Agreement at telephonic and
in-person meetings held during April and May 2006. The Board, including the
independent trustees, approved the BlackRock Management Agreement at an
in-person meeting held on May 12, 2006.
To assist the Board in its consideration of the BlackRock Management Agreement,
BlackRock provided materials and information about BlackRock, including its
financial condition and asset management capabilities and organization, and
Merrill Lynch provided materials and information about the Transaction. The
independent trustees, through their independent legal counsel, also requested
and received additional information from Merrill Lynch and BlackRock in
connection with their consideration of the BlackRock Management Agreement. The
additional information was provided in advance of the May 12, 2006 meeting. In
addition, the independent trustees consulted with their counsel and Fund counsel
on numerous occasions, discussing, among other things, the legal standards and
certain other considerations relevant to the trustees' deliberations.
At the Board meetings, the trustees discussed with Merrill Lynch management and
certain BlackRock representatives the Transaction, its strategic rationale and
BlackRock's general plans and intentions regarding the Fund. At these Board
meetings, representatives of Merrill Lynch and BlackRock made presentations to
and responded to questions from the Board. The trustees also inquired about the
plans for and anticipated roles and responsibilities of certain employees and
officers of the Previous Manager, and of its affiliates, to be transferred to
BlackRock in connection with the Transaction. The independent trustees of the
Board also conferred separately and with their counsel about the Transaction and
other matters related to the Transaction on a number of occasions, including in
connection with the April and May 2006 meetings. After the presentations and
after reviewing the written materials provided, the independent trustees met in
executive sessions with their counsel to consider the BlackRock Management
Agreement.
In connection with the Board's review of the BlackRock Management Agreement,
Merrill Lynch and/or BlackRock advised the trustees about a variety of matters.
The advice included the following, among other matters:
o that there was not expected to be any diminution in the nature, quality
and extent of services provided to the Fund and its shareholders by
BlackRock Advisors, including compliance services;
o that operation of New BlackRock as an independent investment management
firm would enhance its ability to attract and retain talented
professionals;
o that the Fund was expected to benefit from having access to BlackRock's
state of the art technology and risk management analytic tools, including
investment tools, provided under the BlackRock Solutions(R) brand name;
o that BlackRock had no present intention to alter any applicable expense
waivers or reimbursements that were currently in effect and, while it
reserved the right to do so in the future, it would seek the approval of
the Board before making any changes;
o that BlackRock and Merrill Lynch would enter into an agreement, for an
initial three-year period and automatically renewable from year to year
thereafter, in connection with the Transaction under which Merrill
Lynch-affiliated broker-dealers would continue to offer the Fund as an
investment product;
o that BlackRock Advisors would have substantially the same access to the
Merrill Lynch sales force when distributing shares of the Fund as was
currently being provided to the Previous Manager and that other
arrangements between the Previous Manager and Merrill Lynch sales channels
would be preserved;
o that the Fund would have access to BlackRock's network of third party
brokers, retirement plan platforms and registered managers;
o that in connection with the Transaction, Merrill Lynch and BlackRock had
agreed to conduct, and use reasonable
34 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
best efforts to cause their respective affiliates to conduct, their
respective businesses in compliance with the conditions of Section 15(f)
of the Investment Company Act of 1940 (the "1940 Act") in relation to any
public funds advised by BlackRock or the Previous Manager (or affiliates),
respectively; and
o that Merrill Lynch and BlackRock would derive benefits from the
Transaction and that, as a result, they had a financial interest in the
matters being considered that was different from that of Fund
shareholders.
The trustees considered the information provided by Merrill Lynch and BlackRock
above, and, among other factors, the following:
o the potential benefits to Fund shareholders from being part of a combined
fund family with BlackRock-sponsored funds, including possible economies
of scale and access to investment opportunities;
o the potential for expanding distribution of Fund shares through improved
access to third party distribution;
o the reputation, financial strength and resources of BlackRock and its
investment advisory subsidiaries and the anticipated financial strength
and resources of New BlackRock;
o the compliance policies and procedures of BlackRock Advisors;
o the terms and conditions of the BlackRock Management Agreement, including
the fact that the schedule of the Fund's total advisory fees would not
increase under the BlackRock Management Agreement, but would remain the
same;
o that in May 2005, the Board had performed an initial review of the
Previous Management Agreement, as required by the 1940 Act, and had
determined that the Previous Manager had the capabilities, resources and
personnel necessary to provide the advisory and administrative services to
be provided to the Fund; and that the advisory and/or management fees paid
by the Fund, taking into account any applicable agreed-upon fee waivers
and breakpoints, represented reasonable compensation to the Previous
Manager in light of the services provided, the costs to the Previous
Manager of providing those services, economies of scale, the fees and
other expenses paid by similar funds (including information provided by
Lipper Inc. ["Lipper"]), and such other matters as the trustees had
considered relevant in the exercise of their reasonable judgment; and
o that Merrill Lynch had agreed to pay all expenses of the Fund in
connection with the Board's consideration of the BlackRock Management
Agreement and related agreements and all costs of shareholder approval of
the BlackRock Management Agreement and as a result the Fund would bear no
costs in obtaining shareholder approval of the BlackRock Management
Agreement.
Certain of these considerations are discussed in more detail below.
In its review of the BlackRock Management Agreement, the Board assessed the
nature, quality and scope of the services to be provided to the Fund by the
personnel of BlackRock Advisors and its affiliates, including administrative
services, shareholder services, oversight of fund accounting, marketing services
and assistance in meeting legal and regulatory requirements. In its review of
the BlackRock Management Agreement, the Board also considered a range of
information in connection with its oversight of the services to be provided by
BlackRock Advisors and its affiliates. Among the matters considered were: (a)
fees (in addition to management fees) to be paid to BlackRock Advisors and its
affiliates by the Fund; (b) Fund operating expenses paid to third parties; (c)
the resources devoted to and compliance reports relating to the Fund's
investment objective, policies and restrictions, and its compliance with its
Code of Ethics and BlackRock Advisors' compliance policies and procedures; and
(d) the nature, cost and character of non-investment management services to be
provided by BlackRock Advisors and its affiliates.
In May 2005, prior to the Board meeting to consider the initial approval of the
Previous Management Agreement, the Board had requested and received materials
specifically relating to the Previous Management Agreement. These materials
included (a) information compiled by Lipper on the expected fees and expenses of
the Fund as compared to a comparable group of funds as classified by Lipper; (b)
information on the Fund's portfolio management team and the investment
strategies to be used by the Fund; and (c) information on payments expected to
be received by the Investment Adviser and its affiliates from the Fund.
In their deliberations, the trustees considered information received in
connection with their initial consideration of the Previous Management
Agreement, in addition to information provided by BlackRock and BlackRock
Advisors in connection
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 35
Disclosure of New Investment Advisory Agreement (continued)
with their evaluation of the terms and conditions of the BlackRock Management
Agreement. The trustees did not identify any particular information that was
all-important or controlling, and each trustee attributed different weights to
the various factors. The trustees, including a majority of the independent
trustees, concluded that the terms of the BlackRock Management Agreement are
appropriate, that the fees to be paid are reasonable in light of the services to
be provided to the Fund, and that the BlackRock Management Agreement should be
approved and recommended to Fund shareholders.
Nature, Quality and Extent of Services Provided -- The Board reviewed the
nature, quality and extent of services provided by the Previous Manager,
including the investment advisory services and the resulting performance of the
Fund, as well as the nature, quality and extent of services expected to be
provided by BlackRock Advisors. The Board focused primarily on the Previous
Manager's investment advisory services and the Fund's investment performance,
but also considered certain areas in which both the Previous Manager and the
Fund received services as part of the Merrill Lynch complex. While the Board
reviews performance data at least quarterly, consistent with the Previous
Manager's investment goals, the Board attaches more importance to performance
over relatively long periods of time, typically three to five years, or a
shorter period in the case of a fund that has been in existence less than five
years.
In evaluating the nature, quality and extent of the services to be provided by
BlackRock Advisors under the BlackRock Management Agreement, the trustees
considered, among other things, the expected impact of the Transaction on the
operations, facilities, organization and personnel of New BlackRock and how it
would affect the Fund; the ability of BlackRock Advisors to perform its duties
after the Transaction; and any anticipated changes to the investment and other
practices of the Fund.
The trustees were given information with respect to the potential benefits to
the Fund and its shareholders from having access to BlackRock's state of the art
technology and risk management analytic tools, including the investment tools
provided under the BlackRock Solutions brand name.
The trustees were advised that, as a result of Merrill Lynch's equity interest
in BlackRock after the Transaction, the Fund would continue to be subject to
restrictions concerning certain transactions involving Merrill Lynch affiliates
(for example, transactions with a Merrill Lynch broker-dealer acting as
principal) absent revised or new regulatory relief. The trustees were advised
that a revision of existing regulatory relief with respect to these restrictions
was being sought from the Securities and Exchange Commission and were advised of
the possibility of receipt of such revised regulatory relief.
Based on their review of the materials provided and the assurances they had
received from the management of Merrill Lynch and of BlackRock, the trustees
determined that the nature and quality of services to be provided to the Fund
under the BlackRock Management Agreement were expected to be as good as or
better than that provided under the Previous Management Agreement. The trustees
were advised that BlackRock Advisors did not plan to change the Fund's portfolio
management team upon the closing of the Transaction. It was noted, however, that
other changes in personnel were expected to follow the Transaction and the
combination of the operations of the Previous Manager and its affiliates with
those of BlackRock. The trustees noted that if portfolio managers or other
personnel were to cease to be available prior to the closing of the Transaction,
the Board would consider all available options, including seeking the investment
advisory or other services of BlackRock affiliates. Accordingly, the trustees
concluded that, overall, they were satisfied at the present time with assurances
from BlackRock and BlackRock Advisors as to the expected nature, quality and
extent of the services to be provided to the Fund under the BlackRock Management
Agreement.
Costs of Services Provided and Profitability -- It was noted that, in
conjunction with their initial consideration of the Previous Management
Agreement, the trustees had received, among other things, a report from Lipper
comparing the Fund's expected fees and expenses to those of a peer group
selected by Lipper. The Board reviewed the Fund's contractual management fee
rate and actual management fee rate as a percentage of total assets at common
asset levels -- the actual rate includes advisory fees and the effects of any
fee waivers -- compared to the other funds in its Lipper category. The
information showed that the Fund had expected fees and expenses within the range
of fees and expenses of comparable funds. The Board also considered the services
to be provided by and the fees to be charged by BlackRock Advisors to other
funds with similar investment mandates and noted that the fees charged by
BlackRock Advisors in those cases, including fee waivers and expense
reimbursements, were generally comparable to those being charged to the Fund.
The Board also noted that, as a general matter, according to the information
provided by BlackRock, fees charged to institutional clients were lower than the
fees charged to the Fund, but
36 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
BlackRock Advisors provided less extensive services to such clients. The Board
concluded that the Fund's management fee rate and overall expense ratio were
reasonable compared to those of other comparable funds.
In evaluating the costs of the services to be provided by BlackRock Advisors
under the BlackRock Management Agreement, the trustees considered, among other
things, whether advisory fees or other expenses would change as a result of the
Transaction. Based on their review of the materials provided and the fact that
the BlackRock Management Agreement is substantially similar to the Previous
Management Agreement in all material respects, including the rate of
compensation, the trustees determined that the Transaction should not increase
the total fees payable, including any fee waivers and expense reimbursements,
for advisory and administrative services. The trustees noted that it was not
possible to predict how the Transaction would affect BlackRock Advisors'
profitability from its relationship with the Fund.
The trustees discussed with BlackRock Advisors its general methodology to be
used in determining New BlackRock's profitability with respect to its
relationship with the Fund. The trustees noted that they expect to receive
profitability information from New BlackRock on at least an annual basis and
thus be in a position to evaluate whether any adjustments in the Fund's fees
and/or fee breakpoints would be appropriate.
Fees and Economies of Scale -- The Board considered the extent to which
economies of scale might be realized as the assets of the Fund increase and
whether there should be changes in the management fee rate or structure in order
to enable the Fund to participate in these economies of scale. The Board
determined that changes were not currently necessary.
In reviewing the Transaction, the trustees considered, among other things,
whether advisory fees or other expenses would change as a result of the
Transaction. Based on the fact that the BlackRock Management Agreement is
substantially similar to the Previous Management Agreement in all material
respects, including the rate of compensation, the trustees determined that as a
result of the Transaction, the Fund's total advisory fees would be no higher
than the fees under the Previous Management Agreement. The trustees noted that
in conjunction with their initial deliberations concerning the Previous
Management Agreement, they had determined that the expected total fees for
advisory and administrative services for the Fund were reasonable in light of
the services to be provided. It was noted that in conjunction with the initial
consideration of the Previous Management Agreement, the trustees had received,
among other things, a report from Lipper comparing the Fund's expected fees and
expenses to those of a peer group selected by Lipper. The trustees concluded
that because the rates for advisory fees for the Fund would be no higher than
the fee rates in effect at the time, the proposed management fee structure,
including any fee waivers, was reasonable in relation to the services provided
and that no changes were currently necessary.
Fall-Out Benefits -- In evaluating the fall-out benefits to be received by
BlackRock Advisors under the BlackRock Management Agreement, the trustees
considered whether BlackRock Advisors would experience such benefits to the same
extent that the Previous Manager was experiencing such benefits under the
Previous Management Agreement. Based on their review of the materials provided,
including materials received in connection with their initial approval of the
Previous Management Agreement, and their discussions with management of the
Previous Manager and BlackRock, the trustees determined that BlackRock Advisors'
fall-out benefits could include increased ability for BlackRock to distribute
shares of its funds and other investment products and to obtain research
services using the Fund's portfolio transaction brokerage commissions. The
trustees noted that fall-out benefits were difficult to quantify with certainty
at this time, and indicated that they would continue to evaluate them going
forward.
Investment Performance -- The trustees considered investment performance for the
Fund. While the Board reviews performance data at least quarterly, consistent
with the Previous Manager's investment goals, the Board attaches more importance
over relatively long periods of time, typically three to five years, or a
shorter period in the case of a fund that has been in existence less than five
years. The trustees believed the Fund's performance was satisfactory. Also, the
trustees took into account the investment performance of funds advised by
BlackRock Advisors. The Board considered comparative information from Lipper
which showed that the performance of the funds advised by BlackRock Advisors was
within the range of performance of comparable funds over different time periods.
The Board noted BlackRock's considerable investment management experience and
capabilities, but was unable to predict what effect, if any, consummation of the
Transaction would have on the future performance of the Fund.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 37
Disclosure of New Investment Advisory Agreement (concluded)
Conclusion -- After the independent trustees of the Fund deliberated in
executive session, the entire Board, including the independent trustees,
approved the BlackRock Management Agreement, concluding that the management fee
rate was reasonable in relation to the services provided and that the BlackRock
Management Agreement was in the best interests of the shareholders. In approving
the BlackRock Management Agreement, the Board noted that it anticipated
reviewing the continuance of the agreement in advance of the expiration of the
initial two-year period.
New BlackRock Sub-Advisory Agreement -- Matters Considered by the Board
At an in-person meeting held on August 14-16, 2006, the Board of Trustees,
including the independent trustees, discussed and approved the sub-advisory
agreements (the "BlackRock Sub-Advisory Agreements") between BlackRock Advisors
and each of BlackRock Investment Management, LLC and BlackRock Asset Management
U.K. Limited, each an affiliate (the "Sub-Advisers"). The BlackRock Sub-Advisory
Agreements became effective on September 29, 2006, at the same time the
BlackRock Management Agreement became effective.
Pursuant to the pertinent BlackRock Sub-Advisory Agreement, each Sub-Adviser
receives a monthly fee from BlackRock Advisors equal to 37% of the advisory fee
received by BlackRock Advisors from the Fund. BlackRock Advisors pays each
Sub-Adviser out of its own resources, and there is no increase in Fund expenses
as a result of the BlackRock Sub-Advisory Agreements.
In approving the BlackRock Sub-Advisory Agreements at the August in-person
meeting, the Board reviewed its considerations in connection with its approval
of the BlackRock Management Agreement in May 2006. The Board relied on the same
information and considered the same factors as those discussed above in
connection with the approval of the BlackRock Management Agreement and came to
the same conclusion. In reviewing the sub-advisory fee rate provided in the
BlackRock Sub-Advisory Agreements, the Board noted the fact that both BlackRock
Advisors and each Sub-Adviser have significant responsibilities under their
respective advisory agreements. BlackRock Advisors remains responsible for
oversight of the Fund's operations and administration, and each Sub-Adviser
provides advisory services to the Fund and is responsible for the day-to-day
management of the Fund's portfolio under the pertinent BlackRock Sub-Advisory
Agreement. The Board also took into account the fact that there is no increase
in total advisory fees paid by the Fund as a result of the BlackRock
Sub-Advisory Agreements. Under all of the circumstances, the Board concluded
that it was a reasonable allocation of fees for each Sub-Adviser to receive 37%
of the advisory fee paid by the Fund to BlackRock Advisors.
After the independent trustees deliberated in executive session, the entire
Board, including the independent trustees, approved each BlackRock Sub-Advisory
Agreement, concluding that the sub-advisory fee was reasonable in relation to
the services provided and that each BlackRock Sub-Advisory Agreement was in the
best interests of shareholders.
38 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
Officers and Trustees
Number of
Funds and
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name Address & Age Fund Served Principal Occupation(s) During Past 5 Years Trustee Trustee
====================================================================================================================================
Interested Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Robert C. P.O. Box 9011 President 2005 to Vice Chairman and Director of BlackRock, Inc., 122 Funds None
Doll, Jr.* Princeton, NJ and present Global Chief Investment Officer for Equities, 168 Portfolios
08543-9011 Trustee Chairman of the BlackRock Retail Operating
Age: 52 Committee, and of the BlackRock Executive Committee
since 2006; President of the Funds advised by
Merrill Lynch Investment Managers, L.P. ("MLIM")
and its affiliates ("MLIM/FAM-advised funds") from
2005 to 2006 and Chief Investment Officer thereof
from 2001 to 2006; President of MLIM and Fund Asset
Management, L.P. ("FAM") from 2001 to 2006; Co-Head
(Americas Region) thereof from 2000 to 2001 and
Senior Vice President from 1999 to 2001; President
and Director of Princeton Services, Inc.
("Princeton Services") since 2001; President of
Princeton Administrators, L.P. ("Princeton
Administrators") from 2001 to 2006; Chief
Investment Officer of OppenheimerFunds, Inc. in
1999 and Executive Vice President thereof from 1991
to 1999.
------------------------------------------------------------------------------------------------------------------------
* Mr. Doll is a director, trustee or member of an advisory board of certain other investment companies for which
BlackRock acts as investment adviser. Mr. Doll is an "interested person" as defined in the Investment Company Act,
of the Fund based on his current and former positions with BlackRock, Inc. and its affiliates. Trustees serve
until their resignation, removal, or death, or until December 31 of the year in which they turn 72. As Fund
President, Mr. Doll serves at the pleasure of the Board of Trustees.
====================================================================================================================================
Independent Trustees*
- ------------------------------------------------------------------------------------------------------------------------------------
Ronald W. P.O. Box 9095 Trustee 2005 to Professor Emeritus of Finance, School of Business, 47 Funds None
Forbes** Princeton, NJ present State University of New York at Albany since 2000 49 Portfolios
08543-9095 and Professor thereof from 1989 to 2000; Interna-
Age: 66 tional Consultant, Urban Institute, Washington,
D.C. from 1995 to 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
Cynthia A. P.O. Box 9095 Trustee 2005 to Professor, Harvard Business School since 1989; 47 Funds Newell
Montgomery Princeton, NJ present Associate Professor, J.L. Kellogg Graduate School 49 Portfolios Rubbermaid,
08543-9095 of Management, Northwestern University from 1985 to Inc.
Age: 54 1989; Associate Professor, Graduate School of (manufactur-
Business Administration, University of Michigan ing)
from 1979 to 1985; Director, Harvard Business
School Publishing since 2005; Director, McLean
Hospital since 2005.
- ------------------------------------------------------------------------------------------------------------------------------------
Jean Margo P.O. Box 9095 Trustee 2005 to Self-employed consultant since 2001; Counsel of 47 Funds None
Reid Princeton, NJ present Alliance Capital Management (investment adviser) in 49 Portfolios
08543-9095 2000; General Counsel, Director and Secretary of
Age: 61 Sanford C. Bernstein & Co., Inc. (investment
adviser/broker-dealer) from 1997 to 2000;
Secretary, Sanford C. Bernstein Fund, Inc. from
1994 to 2000; Director and Secretary of SCB, Inc.
since 1998; Director and Secretary of SCB Partners,
Inc. since 2000; and Director of Covenant House
from 2001 to 2004.
- ------------------------------------------------------------------------------------------------------------------------------------
Roscoe S. P.O. Box 9095 Trustee 2005 to President, Middle East Institute, from 1995 to 47 Funds None
Suddarth Princeton, NJ present 2001; Foreign Service Officer, United States 49 Portfolios
08543-9095 Foreign Service, from 1961 to 1995 and Career
Age: 71 Minister from 1989 to 1995; Deputy Inspector
General, U.S. Department of State, from 1991 to
1994; U.S. Ambassador to the Hashemite Kingdom of
Jordan from 1987 to 1990.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 39
Officers and Trustees (concluded)
Number of
Funds and
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name Address & Age Fund Served Principal Occupation(s) During Past 5 Years Trustee Trustee
====================================================================================================================================
Independent Trustees* (concluded)
- ------------------------------------------------------------------------------------------------------------------------------------
Richard R. P.O. Box 9095 Trustee 2005 to Professor of Finance from 1984 to 1995; Dean from 47 Funds Bowne & Co.,
West Princeton, NJ present 1984 to 1993 and since 1995 Dean Emeritus of New 49 Portfolios Inc.
08543-9095 York University's Leonard N. Stern School of (financial
Age: 68 Business Administration. printers);
Vornado
Realty Trust
(real estate
company);
Alexander's,
Inc. (real
estate
company)
- ------------------------------------------------------------------------------------------------------------------------------------
Edward D. P.O. Box 9095 Trustee 2005 to Self-employed financial consultant since 1994; 47 Funds None
Zinbarg*** Princeton, NJ present Executive Vice President of the Prudential 49 Portfolios
08543-9095 Insurance Company of America from 1988 to 1994;
Age: 72 Former Director of Prudential Reinsurance Company
and former Trustee of the Prudential Foundation.
------------------------------------------------------------------------------------------------------------------------
* Trustees serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.
** Chairman of the Board of Trustees and the Audit Committee.
*** Mr. Zinbarg is expected to retire from the Board of Trustees effective January 1, 2007.
- ------------------------------------------------------------------------------------------------------------------------------------
Position(s) Length of
Held with Time
Name Address & Age Fund Served Principal Occupation(s) During Past 5 Years
====================================================================================================================================
Fund Officers*
- ------------------------------------------------------------------------------------------------------------------------------------
Donald C. P.O. Box 9011 Vice 2005 to Managing Director of BlackRock since 2006; Managing Director of MLIM and FAM in
Burke Princeton, NJ President present 2006; First Vice President of MLIM and FAM from 1997 to 2005 and Treasurer thereof
08543-9011 and from 1999 to 2006; Vice President of MLIM and FAM from 1990 to 1997.
Age: 46 Treasurer
- ------------------------------------------------------------------------------------------------------------------------------------
Dan P.O. Box 9011 Vice 2006 to Director of BlackRock, Inc. since 2006; Director of MLIM from 2000 to 2006; Vice
Chamby Princeton, NJ President present President of MLIM from 1993 to 2000.
08543-9011
Age: 46
- ------------------------------------------------------------------------------------------------------------------------------------
Dennis P.O. Box 9011 Vice 2005 to Managing Director of BlackRock, Inc. since 2006; Managing Director (Equities) of
Stattman Princeton, NJ President present MLIM from 2000 to 2006; Director of MLIM from 1997 to 2000.
08543-9011
Age: 55
- ------------------------------------------------------------------------------------------------------------------------------------
Jeffrey P.O. Box 9011 Fund Chief 2005 to Managing Director of BlackRock and Fund Chief Compliance Officer since 2006; Chief
Hiller Princeton, NJ Compliance present Compliance Officer of the MLIM/FAM-advised funds and First Vice President and Chief
08543-9011 Officer Compliance Officer of MLIM (Americas Region) from 2004 to 2006; Chief Compliance
Age: 55 Officer of the IQ Funds since 2004; Global Director of Compliance at Morgan Stanley
Investment Management from 2002 to 2004; Managing Director and Global Director of
Compliance at Citigroup Asset Management from 2000 to 2002; Chief Compliance
Officer at Soros Fund Management in 2000; Chief Compliance Officer at Prudential
Financial from 1995 to 2000; Senior Counsel in the Securities and Exchange
Commission's Division of Enforcement in Washington, D.C. from 1990 to 1995.
- ------------------------------------------------------------------------------------------------------------------------------------
Alice A. P.O. Box 9011 Secretary 2005 to Director of BlackRock since 2006; Director (Legal Advisory) of MLIM from 2002 to
Pellegrino Princeton, NJ present 2006; Vice President of MLIM from 1999 to 2002; Attorney associated with MLIM from
08543-9011 1997 to 2006; Secretary of MLIM, FAM, FAM Distributors, Inc. and Princeton Services
Age: 46 from 2004 to 2006.
------------------------------------------------------------------------------------------------------------------------
* Officers of the Fund serve at the pleasure of the Board of Trustees.
- ------------------------------------------------------------------------------------------------------------------------------------
Further information about the Fund's Officers and Trustees is available in the Fund's Statement of Additional
Information, which can be obtained without charge by calling 1-800-441-7762.
- ------------------------------------------------------------------------------------------------------------------------------------
Custodian
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109-3661
Transfer Agent
PFPC Inc.
Wilmington, DE 19809
40 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
BlackRock Funds
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
their nonpublic 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 personal nonpublic 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 Web sites.
BlackRock does not sell or disclose to nonaffiliated third parties any nonpublic
personal information about its Clients, except as permitted by law or as is
necessary to service Client accounts. These nonaffiliated 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 to nonpublic
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 the nonpublic
personal information of its Clients, including procedures relating to the proper
storage and disposal of such information.
Availability of Additional Information
Electronic copies of most financial reports and prospectuses are available on
the Fund's Web site or shareholders can sign up for e-mail notifications of
quarterly statements, annual and semi-annual reports and prospectuses by
enrolling in the Fund's electronic delivery program.
To enroll:
Shareholders Who Hold Accounts with Investment Advisers, Banks or Brokerages:
Please contact your financial adviser. Please note that not all investment
advisers, banks or brokerages may offer this service.
Shareholders Who Hold Accounts Directly with BlackRock:
1) Access the BlackRock Web site at http://www.blackrock.com/edelivery
2) Select eDelivery under the More Information section
3) Log into your account
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 it 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 contact the Fund at (800)
441-7762.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 41
BlackRock Funds (concluded)
Availability of Additional Information (concluded)
Availability of Proxy Voting Policies and Procedures
The Fund has delegated proxy voting responsibilities to BlackRock and its
affiliates, subject to the general oversight of the Fund's Board of Trustees. A
description of the policies and procedures that BlackRock and its affiliates use
to determine how to vote proxies relating to portfolio securities is available
without charge, upon request, on our Web site at www.blackrock.com, by calling
(800) 441-7762, or on the Web site of the Securities and Exchange Commission
(the"Commission") at http://www.sec.gov.
Availability of Proxy Voting Record
Information on how proxies relating to the Fund's voting securities were voted
(if any) by BlackRock during the most recent 12-month period ended June 30 is
available, upon request and without charge, on our Web site at
www.blackrock.com, by calling (800) 441-7762 or on the Web site of the
Commission at http://www.sec.gov.
Availability of Quarterly Portfolio Schedule
The Fund files its complete schedule of portfolio holdings for the first and
third quarters of its fiscal year with the Commission on Form N-Q. The Fund's
Form N-Q is available on the Commission's Web site at http://www.sec.gov and may
be reviewed and copied at the Commission's Public Reference Room in Washington,
D.C. Information regarding the operation of the Public Reference Room may be
obtained by calling (800) SEC-0330. The Fund's Forms N-Q may also be obtained
upon request, without charge, by calling (800) 441-7762.
Shareholder Privileges
Account Information
Call us at (800) 441-7762 8:00 AM - 6:00 PM EST to get information about your
account balances, recent transactions and share prices. You can also reach us on
the web at 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 portfolios.
Systematic Withdrawal Plans
Investor Class shareholders can establish a systematic withdrawal plan and
receive periodic payments of $50 or more from their BlackRock portfolios, as
long as their account 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.
42 BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006
A World-Class Mutual Fund Family
BlackRock now offers an expanded lineup of open-end mutual funds. Our range
includes more than 85 funds crossing all investment styles and managed by
experts in equity, fixed income and tax-exempt investing.
Equity Portfolios
BlackRock All-Cap Global Resources Portfolio
BlackRock Aurora Portfolio
BlackRock Asset Allocation Portfolio+
BlackRock Balanced Capital Fund+
BlackRock Basic Value Fund
BlackRock Developing Capital Markets Fund
BlackRock Equity Dividend Fund
BlackRock EuroFund
BlackRock Focus Twenty Fund
BlackRock Focus Value Fund
BlackRock Fundamental Growth Fund
BlackRock Global Allocation Fund+
BlackRock Global Dynamic Equity Fund
BlackRock Global Financial Services Fund
BlackRock Global Growth Fund
BlackRock Global Opportunities Portfolio
BlackRock Global Resources Portfolio*
BlackRock Global Science & Technology Opportunities Portfolio
BlackRock Global SmallCap Fund
BlackRock Global Technology Fund
BlackRock Global Value Fund
BlackRock Healthcare Fund
BlackRock Health Sciences Opportunities Portfolio
BlackRock Index Equity Portfolio*
BlackRock International Fund
BlackRock International Index Fund
BlackRock International Opportunities Portfolio*
BlackRock International Value Fund
BlackRock Investment Trust
BlackRock Large Cap Core Fund
BlackRock Large Cap Growth Fund
BlackRock Large Cap Value Fund
BlackRock Latin America Fund
BlackRock Legacy Portfolio
BlackRock Mid-Cap Growth Equity Portfolio
BlackRock Mid-Cap Value Equity Portfolio
BlackRock Mid Cap Value Opportunities Fund
BlackRock Natural Resources Trust
BlackRock Pacific Fund
BlackRock Small Cap Core Equity Portfolio
BlackRock Small Cap Growth Equity Portfolio
BlackRock Small Cap Growth Fund II
BlackRock Small Cap Index Fund
BlackRock Small Cap Value Equity Portfolio*
BlackRock Small/Mid-Cap Growth Portfolio
BlackRock S&P 500 Index Fund
BlackRock U.S. Opportunities Portfolio
BlackRock Utilities and Telecommunications Fund
BlackRock Value Opportunities Fund
Fixed Income Portfolios
BlackRock Bond Fund
BlackRock Enhanced Income Portfolio
BlackRock GNMA Portfolio
BlackRock Government Income Portfolio
BlackRock High Income Fund
BlackRock High Yield Bond Portfolio
BlackRock Inflation Protected Bond Portfolio
BlackRock Intermediate Bond Portfolio
BlackRock Intermediate Bond Portfolio II
BlackRock Intermediate Government Bond Portfolio
BlackRock International Bond Portfolio
BlackRock Low Duration Bond Portfolio
BlackRock Managed Income Portfolio
BlackRock Real Investment Fund
BlackRock Short-Term Bond Fund
BlackRock Total Return Portfolio
BlackRock Total Return Portfolio II
BlackRock World Income Fund
Municipal Bond Portfolios
BlackRock AMT-Free Municipal Bond Portfolio
BlackRock California Insured Municipal Bond Fund
BlackRock Delaware Municipal Bond Portfolio
BlackRock Florida Municipal Bond Fund
BlackRock High Yield Municipal Fund
BlackRock Intermediate Municipal Fund
BlackRock Kentucky Municipal Bond Portfolio
BlackRock Municipal Insured Fund
BlackRock National Municipal Fund
BlackRock New Jersey Municipal Bond Fund
BlackRock New York Municipal Bond Fund
BlackRock Ohio Municipal Bond Portfolio
BlackRock Pennsylvania Municipal Bond Fund
BlackRock Short-Term Municipal Fund
Money Market Portfolios
BlackRock Money Market Portfolio
BlackRock Municipal Money Market Portfolio@
BlackRock NC Municipal MM Portfolio@
BlackRock NJ Municipal MM Portfolio@
BlackRock OH Municipal MM Portfolio@
BlackRock PA Municipal MM Portfolio@
BlackRock Summit Cash Reserves Fund*
BlackRock U.S. Treasury MM Portfolio
BlackRock VA Municipal MM Portfolio@
* See the prospectus for information on specific limitations on investments
in the fund.
+ Mixed asset fund.
@ Tax-exempt fund.
BlackRock mutual funds are distributed by BlackRock Distributors, Inc. You
should consider the investment objectives, risks, charges and expenses of the
funds under consideration carefully before investing. Each fund's prospectus
contains this and other information and is available at www.blackrock.com or by
calling 800-882-0052 or from your financial advisor. The prospectus should be
read carefully before investing.
BLACKROCK GLOBAL DYNAMIC EQUITY FUND OCTOBER 31, 2006 43
This report is transmitted to shareholders only. It is not authorized for use as
an offer of sale or a solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past performance
results shown in this report should not be considered a representation of future
performance. Investment return 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.
Investment in foreign securities involves special risks including fluctuating
foreign exchange rates, foreign government regulations, differing degrees of
liquidity and the possibility of substantial volatility due to adverse
political, economic or other developments.
BlackRock Global Dynamic Equity Fund
P.O. Box 9011
Princeton, NJ 08543-9011
BLACKROCK
#GDE-10/06
Item 2 - Code of Ethics - The registrant has adopted a code of ethics, as of the
end of the period covered by this report, that applies to the
registrant's principal executive officer, principal financial officer
and principal accounting officer, or persons performing similar
functions. A copy of the code of ethics is available without charge at
www.blackrock.com.
Item 3 - Audit Committee Financial Expert - The registrant's board of directors
has determined that (i) the registrant has the following audit
committee financial experts serving on its audit committee and (ii)
each audit committee financial expert is independent: (1) Ronald W.
Forbes, (2) Richard R. West, and (3) Edward D. Zinbarg (retired as of
December 31, 2006).
Item 4 - Principal Accountant Fees and Services
(a) Audit Fees - Fiscal Year Ending October 31, 2006 - $36,000
Fiscal Year Ending October 31, 2005 - NA
The nature of the services relate to the seed audit.
(b) Audit-Related Fees - Fiscal Year Ending October 31, 2006 - $0
Fiscal Year Ending October 31, 2005 - NA
(c) Tax Fees - Fiscal Year Ending October 31, 2006 - $10,068
Fiscal Year Ending October 31, 2005 - NA
(d) All Other Fees - Fiscal Year Ending October 31, 2006 - $0
Fiscal Year Ending October 31, 2005 - $0
(e)(1) The registrant's audit committee (the "Committee") has adopted
policies and procedures with regard to the pre-approval of services.
Audit, audit-related and tax compliance services provided to the
registrant on an annual basis require specific pre-approval by the
Committee. The Committee also must approve other non-audit services
provided to the registrant and those non-audit services provided to the
registrant's affiliated service providers that relate directly to the
operations and the financial reporting of the registrant. Certain of
these non-audit services that the Committee believes are a) consistent
with the SEC's auditor independence rules and b) routine and recurring
services that will not impair the independence of the independent
accountants may be approved by the Committee without consideration on a
specific case-by-case basis ("general pre-approval"). However, such
services will only be deemed pre-approved provided that any individual
project does not exceed $5,000 attributable to the registrant or
$50,000 for all of the registrants the Committee oversees. Any proposed
services exceeding the pre-approved cost levels will require specific
pre-approval by the Committee, as will any other services not subject
to general pre-approval (e.g., unanticipated but permissible services).
The Committee is informed of each service approved subject to general
pre-approval at the next regularly scheduled in-person board meeting.
(e)(2) 0%
(f) Not Applicable
(g) Fiscal Year Ending October 31, 2006 - $3,204,783
Fiscal Year Ending October 31, 2005 - NA
(h) The registrant's audit committee has considered and determined that
the provision of non-audit services that were rendered to the
registrant's investment adviser and any entity controlling, controlled
by, or under common control with the investment adviser that provides
ongoing services to the registrant that were not pre-approved pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible
with maintaining the principal accountant's independence.
Regulation S-X Rule 2-01(c)(7)(ii) - $1,739,500 , 0%
Item 5 - Audit Committee of Listed Registrants - Not Applicable
Item 6 - Schedule of Investments - Not Applicable
Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies - Not Applicable
Item 8 - Portfolio Managers of Closed-End Management Investment Companies - Not
Applicable
Item 9 - Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers - Not Applicable
Item 10 - Submission of Matters to a Vote of Security Holders - Not Applicable
Item 11 - Controls and Procedures
11(a) - The registrant's certifying officers have reasonably designed such
disclosure controls and procedures to ensure material information
relating to the registrant is made known to us by others particularly
during the period in which this report is being prepared. The
registrant's certifying officers have determined that the registrant's
disclosure controls and procedures are effective based on our evaluation
of these controls and procedures as of a date within 90 days prior to
the filing date of this report.
11(b) - As of September 29, 2006, with the conclusion of the combination of
Merrill Lynch's asset management business with BlackRock, the registrant
was migrated to BlackRock's trading and compliance monitoring systems,
and various personnel changes occurred. In conjunction with these
business improvements, there were no changes in the registrants internal
control over financial reporting (as defined in Rule 30a-3(d) under Act
(17 CFR 270.30a-3(d)) that occurred during the last fiscal half-year of
the period covered by this report that has materially affected, or is
reasonably likely to affect, the registrant's internal control over
financial reporting.
Item 12 - Exhibits attached hereto
12(a)(1) - Code of Ethics - See Item 2
12(a)(2) - Certifications - Attached hereto
12(a)(3) - Not Applicable
12(b) - Certifications - Attached hereto
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 Global Dynamic Equity Fund
By: /s/ Robert C. Doll
-------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
BlackRock Global Dynamic Equity Fund
Date: January 3, 2007
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/ Robert C. Doll
-------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
BlackRock Global Dynamic Equity Fund
Date: January 3, 2007
By: /s/ Donald C. Burke
-------------------------------
Donald C. Burke,
Chief Financial Officer of
BlackRock Global Dynamic Equity Fund
Date: January 3, 2007