Mutual Fund Summary Prospectus (497k)
01 2월 2013 - 11:24PM
Edgar (US Regulatory)
JANUARY 28, 2013
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SUMMARY PROSPECTUS
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BlackRock Funds II
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Investor, Institutional and Class R Shares
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BlackRock U.S. Government Bond Portfolio
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Investor A: CIGAX
Investor B: BIGBX
Investor C: BIGCX
Institutional: PNIGX
Class R: BGBRX
Before you invest, you may want to review the Funds prospectus, which contains more information about the Fund and its risks. You can find the
Funds prospectus (including amendments and supplements) and other information about the Fund, including the Funds statement of additional information and shareholder report, online at http://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
prospectus.request@blackrock.com
, or from your financial professional. The Funds prospectus and statement of additional information, both
dated January 28, 2013, 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.
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Not FDIC Insured May Lose Value No Bank Guarantee
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Summary Prospectus
Key Facts about BlackRock U.S. Government Bond Portfolio
Investment Objective
The investment objective of the BlackRock U.S. Government Bond Portfolio (the
U.S. Government Bond Portfolio or the Fund) is to seek to maximize total return, consistent with income generation and prudent investment management.
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 BlackRock-advised fund complex. More information about these and other discounts is available from your
financial professional and in the Details about the Share Classes section on page 38 of the Funds prospectus and in the Purchase of Shares section on page II-71 of the Funds statement of additional information.
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Shareholder Fees
(fees paid directly from your investment)
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Investor A
Shares
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Investor B
Shares
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Investor C
Shares
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Institutional
Shares
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Class R
Shares
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Maximum Sales Charge (Load) Imposed on Purchases (as percentage of offering price)
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4.00%
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None
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None
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None
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None
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Maximum Deferred Sales Charge (Load) (as percentage of offering price or redemption proceeds, whichever is
lower)
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None
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1
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4.50%
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2
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1.00%
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3
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None
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None
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Annual Fund Operating Expenses
(expenses that you pay each year as a percentage of the
value of your investment)
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Investor A
Shares
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Investor B
Shares
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Investor C
Shares
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Institutional
Shares
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Class R
Shares
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Management Fee
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0.49%
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0.49%
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0.49%
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0.49%
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0.49%
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Distribution and/or Service (12b-1) Fees
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0.25%
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1.00%
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1.00%
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None
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0.50%
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Other Expenses
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0.31%
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0.47%
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0.38%
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0.34%
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0.42%
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Total Annual Fund Operating Expenses
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1.05%
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1.96%
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1.87%
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0.83%
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1.41%
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Fee Waivers and/or Expense Reimbursements
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(0.08)%
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(0.05)%
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(0.21)%
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(0.20)%
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Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements
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1.05%
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1.88%
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1.82%
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0.62%
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1.21%
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1
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A contingent deferred sales charge (CDSC) of 0.50% 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.
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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 Funds prospectus for the complete schedule of CDSCs.)
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There is no CDSC on Investor C Shares after one year.
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As described in the Management of the Funds section of the Funds prospectus on page 52, 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
1.07% (for Investor A Shares), 1.88% (for Investor B Shares), 1.82% (for Investor C Shares), 0.62% (for Institutional Shares) and 1.21% (for Class R Shares) of average daily net assets until February 1, 2014. The Fund may have to repay some of these
waivers and 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 Fund or by a vote of a majority of the outstanding voting
securities of the Fund.
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2
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 $10,000 in the Fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs
would be:
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1 Year
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3 Years
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5 Years
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10 Years
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Investor A Shares
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$
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503
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$
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721
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$
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956
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$
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1,631
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Investor B Shares
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$
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641
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$
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958
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$
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1,250
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$
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1,932
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Investor C Shares
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$
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285
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$
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583
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$
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1,006
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$
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2,186
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Institutional Shares
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$
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63
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$
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244
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$
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440
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$
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1,006
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Class R Shares
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$
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123
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$
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427
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$
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752
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$
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1,674
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You would pay the following expenses if you did not
redeem your shares:
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1 Year
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3 Years
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5 Years
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10 Years
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Investor B Shares
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$
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191
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$
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608
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$
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1,050
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$
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1,932
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Investor C Shares
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$
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185
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$
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583
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$
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1,006
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$
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2,186
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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 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 Funds performance. During the most
recent fiscal year, the Funds portfolio turnover rate was 790% of the average value of its portfolio.
Principal Investment Strategies of the Fund
Under
normal circumstances, the Fund invests at least 80% of its assets in bonds that are issued or guaranteed by the U.S. Government and its agencies. The Fund invests primarily in the highest rated government and agency bonds and maintains an average
portfolio duration that is within ±20% of the Barclays U.S. Government/Mortgage Index (the benchmark).
Securities purchased by the Fund generally are rated in the highest rating category (AAA or Aaa) at the time of purchase by at least one major rating agency or are determined by the Fund management team to be of
similar quality. In addition, the Funds dollar-weighted average maturity will be between 3 and 10 years.
The Fund evaluates sectors of the bond market and individual securities within these sectors. The Fund selects bonds from several sectors including: U.S. Treasuries and agency securities, commercial and residential
mortgage-backed securities, collateralized mortgage obligations (CMOs), asset-backed securities and corporate bonds.
The Fund invests primarily in dollar-denominated bonds, but may invest up to 10% of its assets in non-dollar denominated bonds of issuers located outside of the
United States. The Funds investment in non-dollar denominated bonds may be on a currency hedged or unhedged basis.
The Fund may buy or sell options or futures on a security or an index of securities, or enter into credit default swaps and interest rate or foreign currency
transactions, including swaps (collectively, commonly known as derivatives). The Fund may seek to obtain market exposure to the securities in which it primarily invests by entering into a series of purchase and sale contracts or by using other
investment techniques (such as reverse repurchase agreements or dollar rolls).
The Fund may engage in active and frequent trading of portfolio securities to achieve its primary investment strategies.
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 principal risks of investing in the Fund.
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Credit Risk
Credit risk refers to the possibility that the issuer of a security will not be able to make payments of interest and principal
when due. Changes in an issuers credit rating or the markets perception of an issuers creditworthiness may also affect the value of the Funds investment in that issuer.
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Derivatives Risk
The Funds use of derivatives may reduce the Funds returns and/or increase volatility. Volatility is defined as
the characteristic of a security, an index or a market to fluctuate significantly in price within a short time period. Derivatives are also subject to counterparty risk, which is the risk that the other party in the transaction will not fulfill its
contractual obligation. A risk of the Funds use of derivatives is that the fluctuations in their values may not correlate perfectly with the overall securities markets. The possible lack of a liquid secondary market for derivatives and the
resulting inability of the Fund to sell or otherwise close a derivatives position could expose the Fund to losses and could make derivatives more difficult for the Fund to value accurately. Derivatives may give rise to a form of leverage and may
expose the Fund to greater risk and increase its costs. Recent legislation calls for new regulation of the derivatives markets. The extent and impact of the regulation is not yet known and may not be known for some time. New regulation may make
derivatives more costly, may limit the availability of derivatives, or may otherwise adversely affect the value or performance of derivatives.
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Dollar Rolls Risk
Dollar rolls involve the risk that the market value of the securities that the Fund is committed to buy may decline below
the price of the securities the Fund has sold. These transactions may involve leverage.
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Extension Risk
When interest rates rise, certain obligations will be paid off by the obligor more slowly than anticipated, causing the value
of these securities to fall.
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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:
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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.
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Changes in foreign currency exchange rates can affect the value of the Funds portfolio.
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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.
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The governments of certain countries may prohibit or impose substantial restrictions on foreign investments in their capital markets or in certain industries.
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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.
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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.
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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. In addition, investment in mortgage dollar rolls and participation in TBA transactions may significantly increase the Funds portfolio turnover rate. A TBA transaction is a method of trading mortgage-backed securities where the
buyer and seller agree upon general trade parameters such as agency, settlement date, par amount, and price.
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Interest Rate Risk
Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates
fall, and decrease as interest rates rise.
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Leverage Risk
Some transactions may give rise to a form of economic leverage. These transactions may include, among others, derivatives, and
may expose the Fund to greater risk and increase its costs. The use of leverage may cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to meet any required asset segregation
requirements. Increases and decreases in the value of the Funds portfolio will be magnified when the Fund uses leverage.
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Liquidity Risk
Liquidity risk exists when particular investments are difficult to purchase or sell. The Funds investments in illiquid
securities may reduce the returns of the Fund because it may be difficult to sell the illiquid securities at an advantageous time or price. To the extent that the Funds principal investment strategies involve derivatives or securities with
substantial market and/or credit risk, the Fund will tend to have the greatest exposure to liquidity risk. Liquid investments may become illiquid after purchase by the Fund, particularly during periods of market turmoil. Illiquid investments may be
harder to value, especially in changing markets, and if the Fund is forced to sell these investments to meet redemption requests or for other cash needs, the Fund may suffer a loss. In addition, when there is illiquidity in the market for certain
securities, the Fund, due to limitations on illiquid investments, may be subject to purchase and sale restrictions.
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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. 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.
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Mortgage- and Asset-Backed Securities Risks
Mortgage- and asset-backed securities represent interests in pools of mortgages or
other assets, including consumer loans or receivables held in trust. Mortgage- and asset-backed securities are subject to credit, interest rate, prepayment and extension risks. These securities also are subject to risk of default on the underlying
mortgage or asset, particularly during periods of economic downturn. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain mortgage-backed securities.
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Prepayment Risk
When interest rates fall, certain obligations will be paid off by the obligor more quickly than originally anticipated, and
the Fund may have to invest the proceeds in securities with lower yields.
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Repurchase Agreements, Purchase and Sale Contracts Risks
If the other party to a repurchase agreement or purchase and sale contract defaults
on its obligation under the agreement, the Fund may suffer delays and incur costs or lose money in exercising its rights under the agreement. If the seller fails to repurchase the security in either situation and the market value of the security
declines, the Fund may lose money.
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Reverse Repurchase Agreements Risk
Reverse repurchase agreements involve the sale of securities held by the Fund with an agreement to
repurchase the securities at an agreed-upon price, date and interest payment. Reverse repurchase agreements involve the risk that the other party may fail to return the securities in a timely manner or at all. The Fund could lose money if it is
unable to recover the securities and the value of the collateral held by the Fund, including the value of the investments made with cash collateral, is less than the value of securities. These events could also trigger adverse tax consequences to
the Fund.
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U.S. Government Issuer Risk
Treasury obligations may differ in their interest rates, maturities, times of issuance and other
characteristics. Obligations of U.S. Government agencies and authorities are supported by varying degrees of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given that the U.S. Government
will provide financial support to its agencies and authorities if it is not obligated by law to do so.
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Performance Information
The information shows you how the Funds performance has varied year by year and
provides some indication of the risks of investing in the Fund. The table compares the Funds performance to that of the Barclays U.S. Government/Mortgage Index. The returns in the table for Class R Shares, which commenced operations on July
18, 2011, are based on the Funds Institutional Shares adjusted to reflect the class specific fees applicable to Class R Shares. 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 the Funds investment manager and its affiliates had not waived or
reimbursed certain Fund expenses during these periods, the Funds returns would have been lower. Updated information on the Funds performance can be obtained by visiting http://www.blackrock.com/funds or can be obtained by phone at
800-882-0052.
Investor A Shares
ANNUAL TOTAL RETURNS
U.S.
Government Bond Portfolio
As of 12/31
During the ten-year period shown in the bar chart,
the highest return for a quarter was 4.19% (quarter ended September 30, 2011) and the lowest return for a quarter was 2.09% (quarter ended June 30, 2004).
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As of 12/31/12
Average Annual Total Returns
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1 Year
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5 Years
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10 Years
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U.S. Government Bond Portfolio Investor A
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Return Before Taxes
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(1.64
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)%
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3.74
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%
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3.39
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%
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Return After Taxes on Distributions
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(2.13
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)%
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2.44
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%
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2.12
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Return After Taxes on Distributions and Sale of Shares
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(1.07
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)%
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2.43
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%
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2.13
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%
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U.S. Government Bond Portfolio Investor B
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Return Before Taxes
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(2.99
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)%
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3.39
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%
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3.26
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%
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U.S. Government Bond Portfolio Investor C
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Return Before Taxes
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0.63
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%
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3.81
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%
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3.03
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%
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U.S. Government Bond Portfolio Institutional
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Return Before Taxes
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2.70
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%
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5.01
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%
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4.23
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%
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U.S. Government Bond Portfolio Class R
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Return Before Taxes
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2.22
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%
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4.42
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%
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3.63
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%
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Barclays U.S. Government/Mortgage Index (Reflects no deduction for fees, expenses or taxes)
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2.27
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%
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5.46
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%
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4.87
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%
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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 investors tax situation and may 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 B, Investor C,
Institutional and Class R Shares will vary.
6
Investment Manager
The Funds investment manager is BlackRock Advisors, LLC (BlackRock).
The Funds sub-adviser is BlackRock Financial Management, Inc. Where applicable, the use of the term BlackRock also refers to the Funds sub-adviser.
Portfolio Managers
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Name
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Portfolio Manager of the Fund Since
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Title
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Bob Miller
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2012
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Managing Director of BlackRock, Inc.
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Matthew Kraeger
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2012
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Director of BlackRock, Inc.
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Purchase and Sale of Fund Shares
You may
purchase or redeem shares of the Fund each day the New York Stock Exchange (NYSE) is open. To purchase or sell shares you should contact your financial intermediary or financial professional, 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 9819, Providence, Rhode Island 02940-8019), or by the Internet at www.blackrock.com/funds. The Funds initial and subsequent investment minimums
generally are as follows, although the Fund may reduce or waive the minimums in some cases:
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Investor A and
Investor C Shares
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Investor B Shares
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Institutional Shares
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Class R Shares
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Minimum Initial Investment
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$1,000 for all accounts except:
$250 for certain fee-based programs.
$100 for retirement plans.
$50, if establishing Automatic Investment Plan (AIP).
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Available only for exchanges and dividend reinvestments by current holders and for purchase by certain qualified employee benefit plans.
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$2 million for institutions and individuals.
Institutional Shares are available to clients of registered investment advisors who
have $250,000 invested in the Fund.
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$100 for all accounts.
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Minimum Additional Investment
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$50 for all accounts except certain retirement plans and payroll deduction programs may have a lower minimum.
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N/A
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No subsequent minimum.
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No Subsequent minimum.
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Tax Information
The
Funds dividends and distributions may be subject to 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 retirement plan, in which case you may be subject to
Federal income tax upon withdrawal from such tax deferred arrangements.
Payments to Broker/Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial
intermediary, the Fund and BlackRock Investments, LLC, the Funds distributor, or its affiliates may pay the intermediary for the sale of Fund shares and other services. These payments may create a conflict of interest by influencing the
broker-dealer or other financial intermediary and your individual financial professional to recommend the Fund over another investment. Ask your individual financial professional or visit your financial intermediarys website for more
information.
7
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INVESTMENT COMPANY ACT FILE # 811-22061
BlackRock U.S. Government Bond Portfolio Investor
SPRO-USGB-0113
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