iShares US Equity Index: April 2026 fund update

• BlackRock has been managing index portfolios since 1971

• This fund provides low-cost exposure to the largest companies in the US

• It’s closely tracked the FTSE USA Index since launch

• This fund does not currently feature on our Wealth Shortlist of funds chosen by our analysts for their long-term performance potential

How it fits in a portfolio

The iShares US Equity Index fund invests in the US which is home to some of the most established and well-known brands globally such as Apple, Microsoft and Amazon. This fund mainly invests in large companies and across a range of different sectors.

An index tracker fund is one of the simplest ways to invest and can be a low-cost starting point for an investment portfolio aiming to deliver long-term growth. This fund could be used to diversify a portfolio focused on other areas such as Asia or Europe, or be a good addition to a portfolio of tracker funds.

Manager

Dharma Laloobhai is Co-Head of International Index Equity Investments at BlackRock. She oversees the fund managers responsible for iShares equity index funds and exchange-traded funds (ETFs) across Europe, the Middle East, Africa and the Asia-Pacific region. Laloobhai has 25 years of industry experience, with 19 at BlackRock.

Every equity index fund at BlackRock has a primary, secondary and tertiary manager, who each have the ability to run the fund, along with the wider team. The wider team is well-resourced and experienced in index investing.

BlackRock’s global approach allows them to work closely with their teams across the world, aiding more efficient management of their funds. We have positive conviction in BlackRock’s ability to provide simple and effective tracking options for investors.

Process

The fund aims to track its benchmark, the FTSE USA index, by investing in every company in the index and in the same proportion. This is known as full replication and helps the fund closely match the performance of the index.

The fund currently invests in 500 companies, mainly in the technology sector which makes up nearly 40% of the fund. The rest is spread across a variety of industries such as consumer discretionary, industrials, financials and healthcare.

Keeping costs low is a key part of the team’s strategy to track the index closely. The fund managers communicate with local teams in the US to ensure trades are placed at the best price, keeping costs low.

The fund can lend some of its investments to others in exchange for a fee in a process known as stock lending. This helps to offset some of the costs of running the fund. Since BlackRock’s lending program started in 1981, only three borrowers with active loans have defaulted. In each case, BlackRock was able to repurchase every security out on loan with collateral on hand and without any losses to their clients. Even so, stock lending adds risk.

The fund has tracking error targets, which measure how closely it's tracking its benchmark. These are monitored by BlackRock on a daily and monthly basis to ensure the fund is being run efficiently.

Culture

BlackRock is currently the largest asset manager in the world, running around $14trn of assets globally. The company was founded by eight partners including current CEO Larry Fink and is known for both active and passive strategies. Employees at BlackRock are encouraged to hold shares in the company so that they are engaged with helping the company perform well and grow. The iShares brand represents BlackRock's family of index tracking and exchange-traded funds.

As the world's largest asset manager, and with lots of resource and knowledge under its belt, BlackRock benefits from unique access to the marketplace, which can help reduce trading costs. BlackRock is also a pioneer in the passive investment space and has a track record of innovation in this part of the investment market.

The team running this fund works closely with various equity and risk departments across the business. We believe this adds good support and challenge on how to run the fund effectively.

ESG Integration

BlackRock was an early signatory to the PRI and has offered ESG-focused funds for several years, including through its iShares range of passive products. However, it only made a company-wide commitment to ESG in January 2020. Following that announcement, the company has expanded its range of ESG-focused ETFs, screened some thermal coal companies out from its actively managed funds and requires all fund managers to consider ESG risks.

BlackRock’s Investment Stewardship Team aims to vote at 100% of meetings where it has the authority to do so. The Investment Stewardship team engages with companies, in conjunction with fund managers, and the results of proxy votes can be found on the BlackRock website’s ‘proxy voting search’ function.

BlackRock has courted controversy in recent years for failing to put its significant weight behind shareholder resolutions aimed at tackling climate change. It responded by committing to be more transparent on its voting activity and providing rationales for key votes.

BlackRock raised further concerns in 2022 when it indicated it might support fewer shareholder proposals based on environmental and social issues in the future. However, its support for shareholder resolutions has fallen dramatically, from 40% in 2021 to just 4% in 2024. BlackRock argues that many of the resolutions were overreaching, lacked economic merit or didn’t promote long-term shareholder value, but this reasoning has been met with some scepticism.

In 2024, BlackRock announced that its US arm would step back from the Climate Action 100+ collective engagement initiative, citing legal considerations, although it suggested its international arm would remain a member.

As iShares US Equity Index isn’t an ESG-specific fund, there are no company exclusions applied like weapons or tobacco, however an ESG version of this fund is available.

Cost

The fund has an ongoing annual fund charge of 0.04%. We believe this is excellent value when compared with other passive funds in this sector.

We recently made some changes to the amount clients pay to invest with us. Find out more about these changes

Our platform charge of up to 0.35% per year also applies, except in the HL Junior ISA, where no platform charge applies.

Performance

Since the fund launched in June 2012, it’s done a good job of tracking the FTSE USA Index. As you would expect from an index tracker fund, it’s behind the benchmark over the long term because of the costs involved in running the fund. However, the tools used by the managers have helped to keep performance close to the index.

Over the past 10 years, the fund has risen 287.87%* versus 285.66% for the index. Remember, past performance isn’t a guide to the future.

More recently, the fund has returned 14.10% in the last 12 months. As the technology sector makes up a large part of the index, it has a big impact on overall returns and contributed significantly to the fund’s performance during the year.

Other positive contributors were communication services, industrials and energy, while healthcare and real estate were the weakest performing sectors.

Like many global stock markets, the US saw a sharp dip in April 2025 following President Trump’s tariff announcements. Confidence returned when he paused the additional levies to allow new trade deals, helping the market rebound.

Despite positive returns over the year, the US stock market has been volatile as investors continue to assess the long-term implications of artificial intelligence (AI), particularly for the largest technology companies. Money has poured into the so-called winners of AI, pushing some share prices to all-time highs in 2025.

In recent months, investors have become more cautious about how AI could disrupt some companies and make them less relevant. Software companies have seen sharp share price falls this year, due to concerns that AI could replace the software many of them use and create.

Given BlackRock's size, experience and expertise running index tracker funds, we expect the fund to continue to track the FTSE USA Index closely in the future, though there are no guarantees.