iShares Dow Jones Transportati (IYT)

The investment seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones Transportation Average index. The fund uses a representative sampling strategy to try to track the index. The index measures the performance of the transportation sector of the U.S. equity market. The index includes companies in the following primary groups: airlines, trucking, railroads, air freight, transportation services and industrial services. It is nondiversified.

For the fiscal year ended 30 April 2006, iShares Dow Jones Transportation Average Index Fund's total investment income for the period increased 91% to $1.8M. The Company's net increase in the net assets resulting from operations totaled $52.7M, up from $10.6M. Investment income reflects increased dividend income. Net assets resulting from operations also reflects an increase in unrealized appreciation on investments.