iShares MSCI All Country Asia ex Japan ETF (AAXJ US) – Portfolio Construction Methodology

The underlying MSCI AC Asia ex Japan Index targets free-float-adjusted, market-cap-weighted exposure to large- and mid-cap equities across developed and emerging Asian markets, excluding Japan, seeking ~85% free-float coverage within each country. Membership draws from the MSCI Global Investable Market Indexes with investability screens for minimum free float, liquidity (e.g., turnover-based thresholds), foreign listing materiality, length of trading, and foreign ownership limits via inclusion factors. Companies are assigned to size segments using global and market-specific cutoffs with buffer zones to reduce turnover; additions/deletions reflect corporate events and foreign room constraints. The index applies quarterly index reviews, with comprehensive semi-annual reconstitutions, and weights by free-float market cap without issuer caps.

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