Mutual Fund Summary Prospectus (497k)
02 2월 2013 - 12:12AM
Edgar (US Regulatory)
JANUARY 28, 2013
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SUMMARY PROSPECTUS
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BlackRock Funds II
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Investor A1, B1, B3, C1, C2 and C3 Shares
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BlackRock High Yield Bond Portfolio
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Investor B1: BHYDX
Investor C1: BHYEX
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 High Yield Bond Portfolio
Investment Objective
The investment objective of the BlackRock High Yield Bond Portfolio (the High
Yield Fund 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
Investor B1 and Investor C1 Shares of the Fund.
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Shareholder Fees
(fees paid directly from your investment)
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Investor B1
Shares
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Investor C1
Shares
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Maximum Sales Charge (Load) Imposed on Purchases (as percentage of offering price)
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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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4.00%
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1
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1.00%
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2
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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 B1
Shares
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Investor C1
Shares
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Management Fee
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0.43%
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0.43%
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Distribution and/or Service (12b-1) Fees
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0.75%
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0.80%
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Other Expenses
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0.38%
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0.34%
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Acquired Fund Fees and Expenses
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0.01%
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0.01%
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Total Annual Fund Operating Expenses
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1.57%
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1.58%
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Fee Waivers and/or Expense Reimbursements
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(0.10)%
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(0.01)%
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Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements
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1.47%
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1.57%
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1
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A contingent deferred sales charge (CDSC) of 4.00% is assessed if shares are redeemed within two years. The CDSC for Investor B1 Shares decreases for
redemptions made in subsequent years. After six years there is no CDSC on Investor B1 Shares. (See the section Details about the Share Classes Investor B1 and B2 Shares in the Funds prospectus for the complete schedule of
CDSCs.)
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There is no CDSC on Investor C1 Shares after one year.
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The Total Annual Fund Operating Expenses do not correlate to the ratios of expenses to average net assets given in the Funds most recent annual report
which does not include the Acquired Fund Fees and Expenses.
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As described in the Management of the Funds section on page 33, 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 1.46% (for Investor B1 Shares) and
1.56% (for Investor C1 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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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 $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher
or lower, based on these assumptions your costs would be:
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1 Year
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3 Years
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5 Years
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10 Years
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Investor B1 Shares
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$
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550
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$
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786
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$
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1,046
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$
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1,859
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Investor C1 Shares
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$
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260
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$
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498
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$
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859
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$
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1,877
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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 B1 Shares
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$
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150
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$
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486
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$
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846
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$
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1,859
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Investor C1 Shares
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$
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160
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$
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498
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$
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859
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$
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1,877
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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 69% of the average value of its portfolio.
Principal Investment Strategies of the Fund
The High
Yield Fund invests primarily in non-investment grade bonds with maturities of ten years or less. The High Yield Fund normally invests at least 80% of its assets in high yield bonds. The high yield securities (commonly called junk bonds)
acquired by the High Yield Fund will generally be in the lower rating categories of the major rating agencies (BB or lower by Standard & Poors (S&P) or Ba or lower by Moodys Investor Services
(Moodys)) or will be determined by the High Yield Fund management team to be of similar quality. Split rated bonds will be considered to have the higher credit rating. The Fund may invest up to 30% of its assets in non-dollar
denominated bonds of issuers located outside of the United States. The High Yield Funds investment in non-dollar denominated bonds may be on a currency hedged or unhedged basis. The Fund may also invest in convertible and preferred securities.
Convertible securities will be counted toward the Funds 80% policy to the extent they have characteristics similar to the securities included within that policy.
To add additional diversification, the management team can invest in a wide range of
securities including corporate bonds, mezzanine investments, collateralized bond obligations, bank loans and mortgage-backed and asset-backed securities. The High Yield Fund can also invest, to the extent consistent with its investment objective, in
non-U.S. and emerging market securities and currencies. The High Yield Fund may invest in securities of any rating, and may invest up to 10% of its assets (measured at the time of investment) in distressed securities that are in default or the
issuers of which are in bankruptcy.
The High Yield 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 use derivative instruments
to hedge its investments or to seek to enhance returns. The High Yield 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
High Yield Fund may engage in active and frequent trading of portfolio securities to achieve its principal 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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Bank Loan Risk
The market for bank loans may not be highly liquid and a Fund may have difficulty selling them. These investments expose a
Fund to the credit risk of both the financial institution and the underlying borrower.
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Collateralized Bond Obligation Risk
The pool of high yield securities underlying collateralized bond obligations is typically separated in
groupings called tranches representing different degrees of credit quality. The higher quality tranches have greater degrees of protection and pay lower interest rates. The lower tranches, with greater risk, pay higher interest rates.
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Convertible Securities Risk
The market value of a convertible security performs like that of a regular debt security; that is, if market
interest rates rise, the value of a convertible security usually falls. In addition, convertible securities are subject to the risk that the issuer will not be able to pay interest or dividends when due, and their market value may change based on
changes in the issuers credit rating or the markets perception of the issuers creditworthiness. Since it derives a portion of its value from the common stock into which it may be converted, a convertible security is also subject to
the same types of market and issuer risks that apply to the underlying common stock.
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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
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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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Distressed Securities Risk
Distressed securities are speculative and involve substantial risks in addition to the risks of investing in junk
bonds. The Fund will generally not receive interest payments on the distressed securities and may incur costs to protect its investment. In addition, distressed securities involve the substantial risk that principal will not be repaid. These
securities may present a substantial risk of default or may be in default at the time of investment. The Fund may incur additional expenses to the extent it is required to seek recovery upon a default in the payment of principal of or interest on
its portfolio holdings. In any reorganization or liquidation proceeding relating to a portfolio company, the Fund may lose its entire investment or may be required to accept cash or securities with a value less than its original investment.
Distressed securities and any securities received in an exchange for such securities may be subject to restrictions on resale.
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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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Emerging Markets Risk
Emerging markets are riskier than more developed markets because they tend to develop unevenly and may never
fully develop. Investments in emerging markets may be considered speculative. Emerging markets are more likely to experience hyperinflation and currency devaluations, which adversely affect returns to U.S. investors. In addition, many emerging
securities markets have far lower trading volumes and less liquidity than developed markets.
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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.
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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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Junk Bonds Risk
Although junk bonds generally pay higher rates of interest than investment grade bonds, junk bonds are high risk investments
that may cause income and principal losses for the Fund.
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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
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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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Mezzanine Securities Risk
Mezzanine securities carry the risk that the issuer will not be able to meet its obligations and that the equity
securities purchased with the mezzanine investments may lose value.
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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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Preferred Securities Risk
Preferred securities may pay fixed or adjustable rates of return. Preferred securities are subject to
issuer-specific and market risks applicable generally to equity securities. In addition, a companys preferred securities generally pay dividends only after the company makes required payments to holders of its bonds and other debt. For this
reason, the value of preferred securities will usually react more strongly than bonds and other debt to actual or perceived changes in the companys financial condition or prospects. Preferred securities of smaller companies may be more
vulnerable to adverse developments than preferred stock of larger companies.
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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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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. Corporate High Yield 2%
Issuer Capped Index. Prior to October 2, 2006, Investor B1 and Investor C1 Share performance results are those of Institutional Shares (which have no distribution or service fees) restated to reflect Investor B1 and Investor C Share fees,
respectively. 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.
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Investor B1 Shares
ANNUAL TOTAL RETURNS
BlackRock High Yield Bond Portfolio
As of 12/31
During the ten-year period shown in the bar chart,
the highest return for a quarter was 17.14% (quarter ended June 30, 2009) and the lowest return for a quarter was 20.97% (quarter ended December 31, 2008).
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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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BlackRock High Yield Bond Portfolio Investor B1
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Return Before Taxes
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12.15
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%
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8.40
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%
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9.57
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Return After Taxes on Distributions
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9.77
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%
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5.57
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%
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6.63
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Return After Taxes on Distributions and Sale of Shares
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7.81
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%
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5.41
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%
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6.47
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%
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BlackRock High Yield Bond Portfolio Investor C1
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Return Before Taxes
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15.05
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%
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8.59
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%
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9.49
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Barclays U.S. Corporate High Yield 2% Issuer Capped Index
(Reflects no deduction for fees, expenses or taxes)
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15.78
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%
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10.45
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%
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10.60
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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 B1 Shares only, and the after-tax returns for C1 Shares will vary.
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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James Keenan, CFA
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2007
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Managing Director of BlackRock, Inc.
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Mitchell Garfin, CFA
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2009
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Managing Director of BlackRock, Inc.
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Derek Schoenhofen
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2009
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Director of BlackRock, Inc.
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Charlie McCarthy, CFA
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2012
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Managing Director of BlackRock, Inc.
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6
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.
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Investor B1 and Investor C1 Shares
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Minimum Initial Investment
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Available only for dividend and capital gain reinvestment for existing shareholders and certain authorized qualified employee benefit
plans.
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Minimum Additional Investment
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N/A
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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.
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INVESTMENT COMPANY ACT FILE # 811-22061
BlackRock High Yield Bond Portfolio Prime
SPRO-HYB-PRI-0113
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