Blackrock Funds

10/03/2024 | Press release | Distributed by Public on 10/03/2024 10:32

Summary Prospectus by Investment Company - Form 497K

BLACKROCK HEALTH SCIENCES OPPORTUNITIES PORTFOLIO
SEPTEMBER 27, 2024
Summary Prospectus
BlackRock FundsSM|Investor, Institutional and Class R Shares
●
BlackRock Health Sciences Opportunities Portfolio
Investor A: SHSAX • Investor C: SHSCX • Institutional: SHSSX • Class R: BHSRX
Before you invest, you may want to review the Fund's prospectus, which contains more information about the Fund and its risks. You can find the Fund's prospectus (including amendments and supplements), reports to shareholders and other information about the Fund, including the Fund's statement of additional information, online at https://www.blackrock.com/prospectus. You can also get this information at no cost by calling (800) 441-7762 or by sending an e-mail request to [email protected], or from your financial professional. The Fund's prospectus and statement of additional information, both dated September 27, 2024, as amended and supplemented from time to time, are incorporated by reference into (legally made a part of) this Summary Prospectus.
This Summary Prospectus contains information you should know before investing, including information about risks. Please read it before you invest and keep it for future reference.
The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this Summary Prospectus. Any representation to the contrary is a criminal offense.
Not FDIC Insured ● May Lose Value ● No Bank Guarantee
Summary Prospectus
Key Facts About BlackRock Health Sciences Opportunities Portfolio
Investment Objective
The investment objective of BlackRock Health Sciences Opportunities Portfolio (the "Fund"), a series of BlackRock FundsSM (the "Trust"), is to provide long-term growth of capital.
Fees and Expenses of the Fund
This table describes the fees and expenses that you may pay if you buy, hold and sell shares of the Fund. You may pay other fees, such as brokerage commissions and other fees to your financial professional or your selected securities dealer, broker, investment adviser, service provider or industry professional (including BlackRock Advisors, LLC ("BlackRock") and its affiliates) (each, a "Financial Intermediary"), which are not reflected in the table and example below. You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $25,000 in the fund complex advised by BlackRock or its affiliates. More information about these and other discounts is available from your Financial Intermediary and in the "Details About the Share Classes" and the "Intermediary-Defined Sales Charge Waiver Policies" sections on pages 25 and A-1, respectively, of the Fund's prospectus and in the "Purchase of Shares" section on page II-90 of Part II of the Fund's Statement of Additional Information.
Shareholder Fees
(fees paid directly from your investment)
Investor A
Shares
Investor C
Shares
Institutional
Shares
Class R
Shares
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage
of offering price)
5.25%
None
None
None
Maximum Deferred Sales Charge (Load) (as a percentage of offering
price or redemption proceeds, whichever is lower)
None1
1.00%2
None
None
Annual Fund Operating Expenses
(expenses that you pay each year as a
percentage of the value of your investment)
Investor A
Shares
Investor C
Shares
Institutional
Shares
Class R
Shares
Management Fee3
0.67%
0.67%
0.67%
0.67%
Distribution and/or Service (12b-1) Fees
0.25%
1.00%
None
0.50%
Other Expenses
0.17%
0.19%
0.17%
0.29%
Total Annual Fund Operating Expenses
1.09%
1.86%
0.84%
1.46%
Fee Waivers and/or Expense Reimbursements3
-
-
-
-
Total Annual Fund Operating Expenses After Fee Waivers and/or
Expense Reimbursements3
1.09%
1.86%
0.84%
1.46%
1
A contingent deferred sales charge ("CDSC") of 1.00% is assessed on certain redemptions of Investor A Shares made within 18 months after purchase where no initial sales charge was paid at the time of purchase as part of an investment of $1,000,000 or more.
2
There is no CDSC on Investor C Shares after one year.
3
As described in the "Management of the Fund" section of the Fund's prospectus beginning on page 41, BlackRock has contractually agreed to waive the management fee with respect to any portion of the Fund's assets estimated to be attributable to investments in other equity and fixed-income mutual funds and exchange-traded funds managed by BlackRock or its affiliates that have a contractual management fee, through June 30, 2026. In addition, BlackRock has contractually agreed to waive its management fees by the amount of investment advisory fees the Fund pays to BlackRock indirectly through its investment in money market funds managed by BlackRock or its affiliates, through June 30, 2026. The contractual agreements may be terminated upon 90 days' notice by a majority of the non-interested trustees of the Trust or by a vote of a majority of the outstanding voting securities of the Fund.
Example:
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
2
1 Year
3 Years
5 Years
10 Years
Investor A Shares
$630
$853
$1,094
$1,784
Investor C Shares
$289
$585
$1,006
$1,979
Institutional Shares
$86
$268
$466
$1,037
Class R Shares
$149
$462
$797
$1,746
You would pay the following expenses if you did not redeem your shares:
1 Year
3 Years
5 Years
10 Years
Investor C Shares
$189
$585
$1,006
$1,979
Portfolio Turnover:
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 27% of the average value of its portfolio.
Principal Investment Strategies of the Fund
Under normal market conditions, the Fund invests at least 80% of its total assets in equity securities, primarily common stock, of companies in health sciences and related industries. The health sciences sector can include companies in health care equipment and supplies, health care providers and services, biotechnology, and pharmaceuticals. Health sciences and related industries can include, but are not limited to, businesses involved in the development, production, and distribution or delivery of medical and pharmaceutical products and services, companies engaged in biotechnology and medical research and development, companies that may design, manufacture or distribute medical, dental and optical equipment and supplies, including diagnostic equipment, and companies that may also provide diagnostic services or operate health facilities and hospitals, or provide related administrative, management and financial support. The Fund will concentrate its investments (i.e., invest more than 25% of its assets) in health sciences or related industries, and may invest in companies located in non-U.S. countries.
The Fund reserves the right to invest up to 20% of its total assets in other types of securities. These may include stocks of companies not associated with health sciences.
Principal Risks of Investing in the Fund
Risk is inherent in all investing. The value of your investment in the Fund, as well as the amount of return you receive on your investment, may fluctuate significantly from day to day and over time. You may lose part or all of your investment in the Fund or your investment may not perform as well as other similar investments. The following is a summary description of the principal risks of investing in the Fund. The relative significance of each risk factor below may change over time and you should review each risk factor carefully.
◼
Equity Securities Risk - Stock markets are volatile. The price of equity securities fluctuates based on changes in a company's financial condition and overall market and economic conditions.
◼
Healthcare-Related Securities Risk - Healthcare companies are strongly affected by worldwide scientific or technological developments. Their products may rapidly become obsolete. Many healthcare companies are also subject to significant government regulation and may be affected by changes in governmental policies.
◼
Concentration Risk - The Fund's strategy of concentrating in health sciences and related companies means that its performance will be closely tied to the performance of a particular market segment. The Fund's concentration in these companies may present more risks than if it were broadly diversified over numerous industries and sectors of the economy. A downturn in these companies would have a larger impact on the Fund than on a mutual fund that does not concentrate in such companies. At times, the performance of these companies will lag the performance of other industries or the broader market as a whole.
◼
Foreign Securities Risk - Foreign investments often involve special risks not present in U.S. investments that can increase the chances that the Fund will lose money. These risks include:
3
◼
The Fund generally holds its foreign securities and cash in foreign banks and securities depositories, which may be recently organized or new to the foreign custody business and may be subject to only limited or no regulatory oversight.
◼
Changes in foreign currency exchange rates can affect the value of the Fund's portfolio.
◼
The economies of certain foreign markets may not compare favorably with the economy of the United States with respect to such issues as growth of gross national product, reinvestment of capital, resources and balance of payments position.
◼
The governments of certain countries, or the U.S. Government with respect to certain countries, may prohibit or impose substantial restrictions through capital controls and/or sanctions on foreign investments in the capital markets or certain industries in those countries, which may prohibit or restrict the ability to own or transfer currency, securities, derivatives or other assets.
◼
Many foreign governments do not supervise and regulate stock exchanges, brokers and the sale of securities to the same extent as does the United States and may not have laws to protect investors that are comparable to U.S. securities laws.
◼
Settlement and clearance procedures in certain foreign markets may result in delays in payment for or delivery of securities not typically associated with settlement and clearance of U.S. investments.
◼
The Fund's claims to recover foreign withholding taxes may not be successful, and if the likelihood of recovery of foreign withholding taxes materially decreases, due to, for example, a change in tax regulation or approach in the foreign country, accruals in the Fund's net asset value for such refunds may be written down partially or in full, which will adversely affect the Fund's net asset value.
◼
The European financial markets have recently experienced volatility and adverse trends due to concerns about economic downturns in, or rising government debt levels of, several European countries as well as acts of war in the region. These events may spread to other countries in Europe and may affect the value and liquidity of certain of the Fund's investments.
◼
Geographic Concentration Risk - From time to time the Fund may invest a substantial amount of its assets in issuers located in a single country or a limited number of countries. If the Fund concentrates its investments in this manner, it assumes the risk that economic, political and social conditions in those countries will have a significant impact on its investment performance. The Fund's investment performance may also be more volatile if it concentrates its investments in certain countries, especially emerging market countries.
◼
Investment Style Risk - Under certain market conditions, growth investments have performed better during the later stages of economic expansion. Therefore, this investment style may over time go in and out of favor. At times when the investment style used by the Fund is out of favor, the Fund may underperform other equity funds that use different investment styles.
◼
Market Risk and Selection Risk - Market risk is the risk that one or more markets in which the Fund invests will go down in value, including the possibility that the markets will go down sharply and unpredictably. The value of a security or other asset may decline due to changes in general market conditions, economic trends or events that are not specifically related to the issuer of the security or other asset, or factors that affect a particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of industries, sector or asset class. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues like pandemics or epidemics, recessions, or other events could have a significant impact on the Fund and its investments. Selection risk is the risk that the securities selected by Fund management will underperform the markets, the relevant indices or the securities selected by other funds with similar investment objectives and investment strategies. This means you may lose money.
An outbreak of an infectious coronavirus (COVID-19) that was first detected in December 2019 developed into a global pandemic that has resulted in numerous disruptions in the market and has had significant economic impact leaving general concern and uncertainty. Although vaccines have been developed and approved for use by various governments, the duration of the pandemic and its effects cannot be predicted with certainty. The impact of this coronavirus, and other epidemics and pandemics that may arise in the future, could affect the economies of many nations, individual companies and the market in general ways that cannot necessarily be foreseen at the present time.
◼
Mid Cap Securities Risk - The securities of mid cap companies generally trade in lower volumes and are generally subject to greater and less predictable price changes than the securities of larger capitalization companies.
◼
Risk of Investing in the United States - Certain changes in the U.S. economy, such as when the U.S. economy weakens or when its financial markets decline, may have an adverse effect on the securities to which the Fund has exposure.
4
◼
Small Cap Securities Risk - Small cap companies may have limited product lines or markets. They may be less financially secure than larger, more established companies. They may depend on a more limited management group than larger capitalized companies.
Performance Information
The information shows you how the Fund's performance has varied year by year and provides some indication of the risks of investing in the Fund. The table compares the Fund's performance to that of the Russell 3000® Index and the Russell 3000® Health Care Index. The Russell 3000® Health Care Index is relevant to the Fund because it has characteristics similar to the Fund's investment strategy. To the extent that dividends and distributions have been paid by the Fund, the performance information for the Fund in the chart and table assumes reinvestment of the dividends and distributions. As with all such investments, past performance (before and after taxes) is not an indication of future results. Sales charges are not reflected in the bar chart. If they were, returns would be less than those shown. However, the table includes all applicable fees and sales charges. If BlackRock and its affiliates had not waived or reimbursed certain Fund expenses during these periods, the Fund's returns would have been lower. Updated information on the Fund's performance, including its current net asset value, can be obtained by visiting www.blackrock.com or can be obtained by phone at (800) 882-0052.
Investor A Shares
ANNUAL TOTAL RETURNS
BlackRock Health Sciences Opportunities Portfolio
As of 12/31
During the ten-year period shown in the bar chart, the highest return for a quarter was 17.47% (quarter ended June 30, 2020) and the lowest return for a quarter was -11.53% (quarter ended March 31, 2020). The year-to-date return as of June 30, 2024 was 9.45%.
For the periods ended 12/31/23
Average Annual Total Returns
1 Year
5 Years
10 Years
BlackRock Health Sciences Opportunities Portfolio - Investor A Shares
Return Before Taxes
(1.87
)%
9.09
%
10.83
%
Return After Taxes on Distributions
(2.76
)%
7.60
%
9.12
%
Return After Taxes on Distributions and Sale of Fund Shares
(0.50
)%
7.07
%
8.46
%
BlackRock Health Sciences Opportunities Portfolio - Investor C Shares
Return Before Taxes
1.81
%
9.45
%
10.79
%
BlackRock Health Sciences Opportunities Portfolio - Institutional Shares
Return Before Taxes
3.84
%
10.56
%
11.73
%
BlackRock Health Sciences Opportunities Portfolio - Class R Shares
Return Before Taxes
3.19
%
9.89
%
11.07
%
Russell 3000® Index1
(Reflects no deduction for fees, expenses or taxes)
25.96
%
15.16
%
11.48
%
Russell 3000® Health Care Index
(Reflects no deduction for fees, expenses or taxes)
2.87
%
10.79
%
10.92
%
1
The Fund has added this broad-based index in response to new regulatory requirements.
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor's tax situation and may
5
differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts. After-tax returns are shown for Investor A Shares only, and the after-tax returns for Investor C, Institutional and Class R Shares will vary.
Investment Manager
The Fund's investment manager is BlackRock Advisors, LLC (previously defined as "BlackRock").
Portfolio Managers
Portfolio Manager
Portfolio Manager
of the Fund Since
Title
Erin Xie, PhD
2003
Managing Director of BlackRock, Inc.
Xiang Liu, PhD
2020
Managing Director of BlackRock, Inc.
Purchase and Sale of Fund Shares
You may purchase or redeem shares of the Fund each day the New York Stock Exchange is open. To purchase or sell shares you should contact your Financial Intermediary, or, if you hold your shares through the Fund, you should contact the Fund by phone at (800) 441-7762, by mail (c/o BlackRock Funds, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429), or by the Internet at www.blackrock.com. The Fund's initial and subsequent investment minimums generally are as follows, although the Fund may reduce or waive the minimums in some cases:
6
Investor A and
Investor C Shares
Institutional Shares
Class R Shares
Minimum Initial
Investment
$1,000 for all accounts except:
•$50, if establishing an Automatic
Investment Plan.
•There is no investment minimum
for employer-sponsored
retirement plans (not including
SEP IRAs, SIMPLE IRAs or
SARSEPs).
•There is no investment minimum
for certain fee-based programs.
There is no minimum initial
investment for:
•Employer-sponsored retirement
plans (not including SEP IRAs,
SIMPLE IRAs or SARSEPs), state
sponsored 529 college savings
plans, collective trust funds,
investment companies or other
pooled investment vehicles,
unaffiliated thrifts and unaffiliated
banks and trust companies, each
of which may purchase shares of
the Fund through a Financial
Intermediary that has entered into
an agreement with the Fund's
distributor to purchase such
shares.
•Clients of Financial Intermediaries
that: (i) charge such clients a fee
for advisory, investment
consulting, or similar services or
(ii) have entered into an
agreement with the Fund's
distributor to offer Institutional
Shares through a no-load program
or investment platform.
•Clients investing through a self-
directed IRA brokerage account
program sponsored by a
retirement plan record-keeper,
provided that such program offers
only mutual fund options and that
the program maintains an account
with the Fund on an omnibus
basis.
$2 million for individuals and
"Institutional Investors," which
include, but are not limited to,
endowments, foundations, family
offices, local, city, and state
governmental institutions,
corporations and insurance
company separate accounts who
may purchase shares of the Fund
through a Financial Intermediary
that has entered into an agreement
with the Fund's distributor to
purchase such shares.
$1,000 for:
•Clients investing through Financial
Intermediaries that offer such
shares on a platform that charges
a transaction based sales
commission outside of the Fund.
•Tax-qualified accounts for
insurance agents that are
registered representatives of an
insurance company's broker-
dealer that has entered into an
agreement with the Fund's
distributor to offer Institutional
Shares, and the family members
of such persons.
$100 for all accounts.
7
Investor A and
Investor C Shares
Institutional Shares
Class R Shares
Minimum Additional
Investment
$50 for all accounts (with the
exception of certain employer-
sponsored retirement plans which
may have a lower minimum).
No subsequent minimum.
No subsequent minimum.
Tax Information
The Fund's dividends and distributions may be subject to U.S. federal income taxes and may be taxed as ordinary income or capital gains, unless you are a tax-exempt investor or are investing through a qualified tax-exempt plan described in section 401(a) of the Internal Revenue Code of 1986, as amended, in which case you may be subject to U.S. federal income tax when distributions are received from such tax-deferred arrangements.
Payments to Broker/Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a Financial Intermediary, the Fund and BlackRock Investments, LLC, the Fund's distributor, or its affiliates may pay the Financial Intermediary for the sale of Fund shares and related services.
These payments may create a conflict of interest by influencing the Financial Intermediary and your individual financial professional to recommend the Fund over another investment.
Ask your individual financial professional or visit your Financial Intermediary's website for more information.
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INVESTMENT COMPANY ACT FILE # 811-05742
SPRO-HSO-0924