BLACKROCK FLEXIBLE EQUITY FUND

497 1 d361752d497.htm BLACKROCK FLEXIBLE EQUITY FUND BLACKROCK FLEXIBLE EQUITY FUND

BLACKROCK FUNDS^SM

BlackRock Flexible Equity Fund

(the “Fund”)

Supplement dated March 28, 2017 to the Summary Prospectuses, the

Prospectuses and the Statement of Additional Information of the Fund, each dated January 27, 2017

On March 23, 2017, the Board of Trustees (the “Board”) of BlackRock Funds^SMapproved certain changes to the Fund. In particular, the Board approved a change in the name of the Fund to “BlackRock Advantage Large Cap Growth Fund” and certain changes to the Fund’s investment objective, investment strategies and investment process. The Board has also approved the liquidation of BlackRock Flexible Equity Fund Subsidiary, Ltd. (the “Cayman Subsidiary”). In addition, Fund management has determined to make certain changes to the Fund’s portfolio management team and the benchmark index against which the Fund compares its performance. These changes are expected to become effective on or about June 12, 2017.

In addition, effective on or about June 12, 2017, the Board approved a reduction in the existing contractual expense caps for the Fund’s Investor A, Investor B, Investor C, Institutional, Class R and Service Shares. To achieve these expense caps, BlackRock Advisors, LLC (“BlackRock”), the Fund’s investment adviser, has agreed to waive and/or reimburse fees or expenses if the Fund’s annual fund operating expenses, excluding certain expenses described in the prospectus, exceed a certain limit for the Fund’s Investor A, Investor B, Investor C, Institutional, Class R and Service Shares. BlackRock may recoup some of the waivers and reimbursements to the Fund in the following two fiscal years. In conjunction with the reduction of the Fund’s contractual expense caps, effective on or about June 12, 2017, BlackRock will discontinue the voluntary expense caps for the Fund’s Investor A, Investor B, Investor C, Institutional, Class R and Service Shares.

Accordingly, effective on or about June 12, 2017, the following changes are made to the Fund’s Summary Prospectuses and Prospectuses, as applicable:

Change in the Fund’s Name

BlackRock Flexible Equity Fund is renamed BlackRock Advantage Large Cap Growth Fund.

Change in the Fund’s Investment Objective

The section of the Summary Prospectuses and the Prospectuses entitled “Investment Objective” or “Fund Overview — Investment Objective,” as applicable, is deleted in its entirety and replaced with the following:

The investment objective of BlackRock Advantage Large Cap Growth Fund (the “Fund”), a series of BlackRock Funds^SM (the “Trust”), is to seek long-term capital appreciation.

The first paragraph of the section of the Prospectuses entitled “Details About the Fund — How the Fund Invests — Investment Objective” is deleted in its entirety and replaced with the following:

The Fund’s investment objective is to seek long-term capital appreciation.

Change in the Fund’s Benchmark Index

Effective on or about June 12, 2017, the Fund is replacing the S&P 500^® Index as a performance benchmark against which the Fund measures its performance with the Russell 1000^® Growth Index.

Liquidation of the Cayman Subsidiary

References to BlackRock Flexible Equity Fund Subsidiary, Ltd. are deleted in their entirety.

Change in the Fund’s Contractual Expense Caps

The section of the Investor, Institutional and Class R Shares Summary Prospectus and the Investor, Institutional and Class R Shares Prospectus entitled “Fees and Expenses of the Fund” or “Fund Overview — Fees and Expenses of the Fund,” as applicable, is deleted in its entirety and replaced with the following:

Fees and Expenses of the Fund

This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. 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 Advisors, LLC (“BlackRock”) and its affiliates. More information about these and other discounts is available from your financial professional or your selected securities dealer, broker, investment adviser, service provider or industry professional (including BlackRock, The PNC Financial Services Group, Inc. and their respective affiliates) (each a “Financial Intermediary”) and in the “Details About the Share Classes” section on page 26 of the Fund’s prospectus and in the “Purchase of Shares” section on page II-70 of Part II of the Fund’s Statement of Additional Information.


Shareholder Fees (fees paid directly from your investment)	Investor A Shares			Investor B 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		None
Maximum Deferred Sales Charge (Load) (as a percentage of offering price or redemption proceeds, whichever is lower)		None	¹		4.50%	²		1.00%	³		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 B Shares			Investor C Shares			Institutional Shares		Class R Shares
Management Fee⁴		0.80%			0.80%			0.80%			0.80%		0.80%
Distribution and/or Service (12b-1) Fees		0.25%			1.00%			1.00%			None		0.50%
Other Expenses		0.37%			0.94%			0.37%			0.34%		0.44%
Total Annual Fund Operating Expenses		1.42%			2.74%			2.17%			1.14%		1.74%
Fee Waivers and/or Expense Reimbursements^4,5		(0.55)%			(1.12)%			(0.55)%			(0.52)%		(0.62)%
Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements^4,5		0.87%			1.62%			1.62%			0.62%		1.12%

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 time of purchase as part of an investment of $1,000,000 or more.

The CDSC is 4.50% if shares are redeemed in less than one year. The CDSC for Investor B Shares decreases for redemptions made in subsequent years. After six years there is no CDSC on Investor B Shares. (See the section “Details About the Share Classes — Investor B Shares” in the Fund’s prospectus for the complete schedule of CDSCs.)

³	There is no CDSC on Investor C Shares after one year.

⁴

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 January 31, 2019. The contractual agreement 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.

⁵

As described in the “Management of the Fund” section of the Fund’s prospectus beginning on page 41, BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses) as a percentage of average daily net assets to 0.87% (for Investor A Shares), 1.62% (for Investor B and Investor C Shares), and 0.62% (for

Institutional Shares) through January 31, 2019 and 1.12% (for Class R Shares) through January 31, 2028. On February 1 of each year, the Class R Shares waiver agreement will renew automatically for an additional year so that the agreement will have a perpetual ten-year term. The Fund may have to repay some of these waivers and/or reimbursements to BlackRock in the following two years. The contractual agreement 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:


	1 Year		3 Years		5 Years		10 Years
Investor A Shares	$	609	$	899	$	1,211	$	2,093
Investor B Shares	$	615	$	1,094	$	1,550	$	2,667
Investor C Shares	$	265	$	626	$	1,114	$	2,460
Institutional Shares	$	63	$	311	$	577	$	1,340
Class R Shares	$	114	$	356	$	617	$	1,363

You would pay the following expenses if you did not redeem your shares:


	1 Year		3 Years		5 Years		10 Years
Investor B Shares	$	165	$	744	$	1,350	$	2,667
Investor C Shares	$	165	$	626	$	1,114	$	2,460

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 36% of the average value of its portfolio.

The fifth paragraph of the section of the Investor, Institutional and Class R Shares Prospectus entitled “Management of the Fund — BlackRock” is deleted in its entirety and replaced with the following:

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 January 31, 2019. The contractual agreement 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.

The eighth paragraph of the section of the Investor, Institutional and Class R Shares Prospectus entitled “Management of the Fund — BlackRock” is deleted in its entirety and replaced with the following:

With respect to the Fund, BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual Fund Operating Expenses to the amounts noted in the table below.


	Contractual Caps¹ on Total Annual Fund Operating Expenses² (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses)
Investor A Shares		0.87	%
Investor B Shares		1.62	%
Investor C Shares		1.62	%
Institutional Shares		0.62	%
Class R Shares		1.12	%

The contractual caps for Investor A Shares, Investor B Shares, Investor C Shares and Institutional Shares are in effect through January 31, 2019 and the contractual cap for Class R Shares is in effect through January 31, 2028. The contractual agreement 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.

²	As a percentage of average daily net assets.

The section of the Service Shares Summary Prospectus and the Service Shares Prospectus entitled “Fees and Expenses of the Fund” or “Fund Overview — Fees and Expenses of the Fund,” as applicable, is deleted in its entirety and replaced with the following:

Fees and Expenses of the Fund

This table describes the fees and expenses that you may pay if you buy and hold Service Shares of the Fund.


Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)	Service Shares
Management Fee¹		0.80%
Distribution and/or Service (12b-1) Fees		0.25%
Other Expenses		0.21%
Total Annual Fund Operating Expenses		1.26%
Fee Waivers and/or Expense Reimbursements^1,2		(0.39)%
Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements^1,2		0.87%

As described in the “Management of the Fund” section of the Fund’s prospectus beginning on page 27, BlackRock Advisors, LLC (“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 January 31, 2019. The contractual agreement 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.

As described in the “Management of the Fund” section of the Fund’s prospectus beginning on page 27, BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses) to

0.87% of average daily net assets through January 31, 2019. The Fund may have to repay some of these waivers and/or reimbursements to BlackRock in the following two years. The contractual agreement 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:


	1 Year		3 Years		5 Years		10 Years
Service Shares	$	89	$	361	$	654	$	1,488

Portfolio Turnover:

The fifth paragraph of the section of the Service Shares Prospectus entitled “Management of the Fund — BlackRock” is deleted in its entirety and replaced with the following:

The eighth paragraph of the section of the Service Shares Prospectus entitled “Management of the Fund — BlackRock” is deleted in its entirety and replaced with the following:

With respect to the Fund, BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual Fund Operating Expenses to the amount noted in the table below.

Contractual Cap¹ on

Total Annual Fund

Operating Expenses²

(excluding Dividend

Expense, Interest

Expense, Acquired Fund

Fees and Expenses and

certain other

Fund expenses)

Service Shares

0.87

¹	The contractual cap is in effect through January 31, 2019. The contractual agreement 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.

²	As a percentage of average daily net assets.

Changes in the Fund’s Investment Strategy and Investment Process

The section of the Summary Prospectuses and Prospectuses entitled “Principal Investment Strategies of the Fund,” “Fund Overview — Principal Investment Strategies of the Fund” or “Details About the Fund — How the Fund Invests — Principal Investment Strategies,” as applicable, is deleted in its entirety and replaced with the following:

Under normal circumstances, the Fund seeks to invest at least 80% of its net assets plus the amount of any borrowings for investment purposes in large cap equity securities of U.S. issuers and derivatives that have similar economic characteristics to such securities. For purposes of the Fund’s 80% policy, large cap equity securities are equity securities that at the time of purchase have a market capitalization within the range of companies included in the Russell 1000^® Growth Index (the “Russell 1000 Growth Index”). The Fund primarily intends to invest in equity securities or other financial instruments that are components of, or have characteristics similar to, the securities included in the Russell 1000 Growth Index. The Russell 1000 Growth Index is a capitalization-weighted index from a broad range of industries chosen for market size, liquidity and industry group representation. The Fund primarily seeks to buy common stock and may also invest in preferred stock and convertible securities. From time to time, the Fund may invest in shares of companies through “new issues” or initial public offerings (“IPOs”). The Fund may use derivatives, including options, futures, swaps, forward contracts and contracts for difference, both to seek to increase the return of the Fund and to hedge (or protect) the value of its assets against adverse movements in currency exchange rates, interest rates and movements in the securities markets. In order to manage cash flows into or out of the Fund effectively, the Fund may buy and sell financial futures contracts or options on such contracts. Derivatives are financial instruments whose value is derived from another security, a currency or an index, including but not limited to the Russell 1000 Growth Index. The use of options, futures, swaps, forward contracts and contracts for difference can be effective in protecting or enhancing the value of the Fund’s assets.

The section of the Prospectuses entitled “Details About the Fund — How the Fund Invests — Investment Process” is deleted in its entirety and replaced with the following:

The Fund seeks to pursue its investment objective by investing in large cap securities in a disciplined manner, by using proprietary return forecast models that incorporate quantitative analysis. These forecast models are designed to identify aspects of mispricing across stocks which the Fund can seek to capture by over- and under-weighting particular equities while seeking to control incremental risk. BlackRock Advisors, LLC, the Fund’s investment manager (“BlackRock”), then constructs and rebalances the portfolio by integrating its investment insights with the model-based optimization process. The Fund has no stated minimum holding period for investments and may buy or sell securities whenever Fund management sees an appropriate opportunity. The Fund may engage in active and frequent trading of its investments.

The section of the Prospectuses entitled “Details About the Fund — How the Fund Invests — Other Strategies Applicable to the Fund” is revised as follows:

The paragraph entitled “New Issues” is deleted in its entirety.

The section of the Prospectuses entitled “Details About the Fund — How the Fund Invests — Other Strategies Applicable to the Fund” is amended to add the following:

•

Depositary Receipts — The Fund may invest in securities of foreign issuers in the form of depositary receipts or other securities that are convertible into securities of foreign issuers. American Depositary Receipts are receipts typically issued by an American bank or trust company that evidence underlying securities issued by a foreign corporation. European Depositary Receipts (issued in Europe) and Global Depositary Receipts (issued throughout the world) each evidence a similar ownership arrangement. The Fund may invest in unsponsored depositary receipts.

•

Money Market Securities — The Fund may invest in money market securities or commercial paper.

The section of the Summary Prospectuses and the Prospectuses entitled “Principal Risks of Investing in the Fund” or “Fund Overview — Principal Risks of Investing in the Fund,” as applicable, is revised as follows:

The paragraph entitled “Credit Risk” is deleted in its entirety.

The paragraph entitled “Debt Securities Risk” is deleted in its entirety.

The paragraph entitled “Depositary Receipts Risk” is deleted in its entirety.

The paragraph entitled “Emerging Markets Risk” is deleted in its entirety.

The paragraphs entitled “Foreign Securities Risk” are deleted in their entirety.

The paragraph entitled “Interest Rate Risk” is deleted in its entirety.

The paragraph entitled “Junk Bonds Risk” is deleted in its entirety.

The paragraph entitled “Mid Cap Securities Risk” is deleted in its entirety.

The paragraph entitled “Small Cap and Emerging Growth Securities Risk” is deleted in its entirety.

The paragraphs entitled “Subsidiary Risk” are deleted in their entirety.

•

High Portfolio Turnover Risk — The Fund may engage in active and frequent trading of its portfolio securities. High portfolio turnover (more than 100%) may result in increased transaction costs to the Fund, including brokerage commissions, dealer mark-ups and other transaction costs on the sale of the securities and on reinvestment in other securities. The sale of Fund portfolio securities may result in the realization and/or distribution to shareholders of higher capital gains or losses as compared to a fund with less active trading policies. These effects of higher than normal portfolio turnover may adversely affect Fund performance.

•

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.

•

“New Issues” Risk — “New issues” are IPOs of equity securities. Securities issued in IPOs have no trading history, and information about the companies may be available for very limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shortly after the IPO.

The section of the Prospectuses entitled “Details About the Fund — Investment Risks — Principal Risks of Investing in the Fund” is revised as follows:

The paragraph entitled “Credit Risk” is deleted in its entirety.

The paragraph entitled “Debt Securities Risk” is deleted in its entirety.

The paragraph entitled “Depositary Receipts Risk” is deleted in its entirety.

The paragraphs entitled “Derivatives Risk — Risks Specific to Certain Derivatives Used by the Fund — Credit Default Swaps,” “— Indexed and Inverse Securities,” “— Commodity-Linked Derivatives” and “— Commodity Linked Notes” are deleted in their entirety.

The paragraphs entitled “Emerging Markets Risk” are deleted in their entirety.

The paragraphs entitled “Foreign Securities Risk” are deleted in their entirety.

The paragraph entitled “Interest Rate Risk” is deleted in its entirety.

The paragraphs entitled “Junk Bonds Risk” are deleted in their entirety.

The paragraph entitled “Mid Cap Securities Risk” is deleted in its entirety.

The paragraphs entitled “Small Cap and Emerging Growth Securities Risk” are deleted in their entirety.

The paragraphs entitled “Subsidiary Risk” are deleted in their entirety.

The section entitled “Details About the Fund — Investment Risks — Principal Risks of Investing in the Fund” in the Prospectus is amended to add the following:

•

“New Issues” Risk — “New issues” are IPOs of equity securities. Investments in companies that have recently gone public have the potential to produce substantial gains for the Fund. However, there is no assurance that the Fund will have access to profitable IPOs and therefore investors should not rely on these past gains as an indication of future performance. The investment performance of the Fund during periods when it is unable to invest significantly or at all in IPOs may be lower than during periods when the Fund is able to do so. In addition, as the Fund increases in size, the impact of IPOs on the Fund’s performance will generally decrease. Securities issued in IPOs are subject to many of the same risks as investing in companies with smaller market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may be available for very limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shortly after the IPO. When an IPO is brought to the market, availability may be limited and the Fund may not be able to buy any shares at the offering price, or, if it is able to buy shares, it may not be able to buy as many shares at the offering price as it would like.

The section of the Prospectuses entitled “Details About the Fund — Investment Risks — Other Risks of Investing in the Fund” is revised as follows:

The paragraph entitled “‘New Issues’ Risk” is deleted in its entirety.

The section of the Prospectuses entitled “Details About the Fund — Investment Risks — Other Risks of Investing in the Fund” is amended to add the following:

•

Depositary Receipts Risk — The issuers of unsponsored depositary receipts are not obligated to disclose information that is, in the United States, considered material. Therefore, there may be less information available regarding these issuers and there may not be a correlation between such information and the market value of the depositary receipts. Depositary receipts are generally subject to the same risks as the foreign securities that they evidence or into which they may be converted.

•

Emerging Markets Risk — The risks of foreign investments are usually much greater for emerging markets. Investments in emerging markets may be considered speculative. Emerging markets may include those in countries considered emerging or developing by the World Bank, the International Finance Corporation or the United Nations. Emerging markets are riskier than more developed markets because they tend to develop unevenly and may never fully develop. They are more likely to experience hyperinflation and currency devaluations, which adversely affect returns to U.S. investors. In addition, many emerging markets have far lower trading volumes and less liquidity than developed markets. Since these markets are often small, they may be more likely to suffer sharp and frequent price changes or long-term price depression because of adverse publicity, investor perceptions or the actions of a few large investors. In addition, traditional measures of investment value used in the United States, such as price to earnings ratios, may not apply to certain small markets. Also, there may be less publicly available information about issuers in emerging markets than would be available about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and financial reporting standards and requirements comparable to those to which U.S. companies are subject. Communications between the United States and emerging market countries may be unreliable, increasing the risk of delayed settlements or losses of security certificates.

Many emerging markets have histories of political instability and abrupt changes in policies. As a result, their governments are more likely to take actions that are hostile or detrimental to private enterprise or foreign investment than those of more developed countries. Some countries have pervasive corruption and crime that may hinder investments. Certain emerging markets may also face other significant internal or external risks, including the risk of war, and ethnic, religious and racial conflicts. In addition, governments in many emerging market countries participate to a significant degree in their economies and securities markets, which may impair investment and economic growth.

•

Foreign Securities Risk — Because the Fund may invest in companies located in countries other than the United States, the Fund may be exposed to risks associated with foreign investments.

•

The value of holdings traded outside the United States (and any hedging transactions in foreign currencies) will be affected by changes in currency exchange rates

•

The costs of non-U.S. securities transactions tend to be higher than those of U.S. transactions

•

Foreign holdings may be adversely affected by foreign government action

•

International trade barriers or economic sanctions against certain non-U.S. countries may adversely affect these holdings

•

The economies of certain countries may compare unfavorably with the U.S. economy

•

Foreign securities markets may be smaller than the U.S. markets, which may make trading more difficult.

•

Money Market Securities Risk — If market conditions improve while the Fund has invested some or all of its assets in high quality money market securities, this strategy could result in reducing the potential gain from the market upswing, thus reducing the Fund’s opportunity to achieve its investment objective.

•

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.

•

Small Cap and Emerging Growth Securities Risk — Small cap or emerging growth companies may have limited product lines or markets. They may be less financially secure than larger, more established companies. They may depend on a small number of key personnel. If a product fails or there are other adverse developments, or if management changes, the Fund’s investment in a small cap or emerging growth company may lose substantial value. In addition, it is more difficult to get information on smaller companies, which tend to be less well known, have shorter operating histories, do not have significant ownership by large investors and are followed by relatively few securities analysts.

The securities of small cap and emerging growth companies generally trade in lower volumes and are subject to greater and more unpredictable price changes than larger cap securities or the market as a whole. In addition, small cap and emerging growth securities may be particularly sensitive to changes in interest rates, borrowing costs and earnings. Investing in small cap and emerging growth securities requires a longer term view.

Change in the Fund’s Portfolio Managers

The section of the Summary Prospectuses and the Prospectuses entitled “Portfolio Manager” or “Fund Overview — Portfolio Manager,” as applicable, is deleted in its entirety and replaced with the following:

Portfolio Managers


Name	Portfolio Manager of the Fund Since	Title
Raffaele Savi	2017	Managing Director of BlackRock, Inc.
Travis Cooke, CFA	2017	Managing Director of BlackRock, Inc.
Richard Mathieson	2017	Managing Director of BlackRock, Inc.

The section of the Prospectuses entitled “Details About the Fund — How the Fund Invests — About the Portfolio Manager of the Fund” is deleted in its entirety and replaced with the following:

ABOUT THE PORTFOLIO MANAGEMENT TEAM OF THE FUND

The Fund is managed by a team of financial professionals. Raffaele Savi, Travis Cooke, CFA, and Richard Mathieson are the portfolio managers and are jointly and primarily responsible for the day-to-day management of the Fund. Please see “Management of the Fund — Portfolio Manager Information” for additional information about the portfolio management team.

The table in the section of the Prospectuses entitled “Management of the Fund — Portfolio Manager Information” is deleted in its entirety and replaced with the following:


Portfolio Manager	Primary Role	Since		Title and Recent Biography
Raffaele Savi	Jointly and primarily responsible for the day-to-day management of the Fund’s portfolio, including setting the Fund’s overall investment strategy and overseeing the management of the Fund.		2017	Managing Director of BlackRock, Inc. since 2009; Managing Director at Barclays Global Investors (“BGI”) from 2007 to 2009; Principal at BGI from 2006 to 2007.
Travis Cooke, CFA	Jointly and primarily responsible for the day-to-day management of the Fund’s portfolio, including setting the Fund’s overall investment strategy and overseeing the management of the Fund.		2017	Managing Director of BlackRock, Inc. since 2012; Director of BlackRock, Inc. from 2009 to 2011, Principal of BGI from 2002 to 2009.
Richard Mathieson	Jointly and primarily responsible for the day-to-day management of the Fund’s portfolio, including setting the Fund’s overall investment strategy and overseeing the management of the Fund.		2017	Managing Director of BlackRock, Inc. since 2011; Director of BlackRock, Inc. from 2009 to 2011; Principal at BGI from 2008 to 2009; Equity Analyst for Exista UK from 2007 to 2008; Principal at BGI from 2005 to 2007; Associate of BGI from 2001 to 2005.

* * *

Shareholders should retain this Supplement for future reference.

PR2SAI-FLEQ-0317SUP