iShares MSCI Japan Small Cap ETF

iShares MSCI Japan Small Cap ETF (SCJ) is a BlackRock index fund that tracks the MSCI Japan Small Cap Index. As of August 31, 2026, it held 788 smaller Japanese companies. It is very spread out: its 10 largest positions made up just 6.28% of assets. Its 0.50% expense ratio is close to the 0.49% average of similar Japan funds but well above the 0.09% charged by Franklin FTSE Japan ETF (FLJP).

• Over the year to Oct 27, 2026, SCJ returned +19.5%, 3rd of 5 among similar funds.
• Its 5-year annualized return was +8.6% and its 10-year +7.2%.
• In the 2020 COVID crash it fell 27.6% and regained its old high 2.8 months after the low.
• Its worst full calendar year was 2008 (-19.0%); its best was 2017 (+31.6%).
• The deepest fall in its price history was 43.5% (May 16, 2008 to Oct 10, 2008), recovered by Feb 3, 2011.

As of Aug 31, 2026, the fund held 788 securities; the ten largest made up 6.28% of assets, and 2.16% sat in cash and money-market holdings.

• Over the three months to Aug 31, 2026, investors added a net $10.9M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.58%, -0.99%, +3.88%.

SCJ tries to match the MSCI Japan Small Cap Index before fees. MSCI is independent of BlackRock. It decides which companies go in the index and how much each one weighs. The index covers about 14% of the free float-adjusted value of the Japanese stock market. "Free float" means only shares available to public investors are counted. As of August 31, 2025, consumer goods and services companies and industrial companies made up a large share of the index.

BlackRock Fund Advisors uses "representative sampling." Instead of owning every stock in the index, it holds a group of stocks that together match the index's company sizes, industry mix, yield and volatility. At least 80% of assets go into index stocks or near-identical depositary receipts. Up to 20% can go into futures, options, swaps, cash and other securities that help it track the index. As of August 31, 2026, cash was about 2.16% of assets, and a Mini TOPIX futures contract was about 0.01%.

The fund doesn't try to beat the index or move to cash when markets fall. Portfolio turnover was 17% in the prospectus, which is low. The fund may lend out securities worth up to one-third of its assets. Because it is priced in dollars, a weaker yen lowers its value even if Japanese share prices hold steady.

• SCJ charges 0.5% a year, versus an average of 0.49% for the similar funds below (3rd of 5, cheapest first).
• Of that, 0.49% is the management fee; the rest covers other fund expenses.
• Using the prospectus's standard example, $10,000 invested would cost about $51 in the first year and $628 over 10 years (assuming a 5% annual return).

It owns small companies in a single country, it carries currency risk, and it has lost as much as 43.5% from a peak.

SCJ adds hundreds of smaller Japanese companies, and exposure to the yen, that a US-focused portfolio lacks. It has also fallen hard. In the 2020 COVID crash it dropped 27.6% in less than a month and was back to its peak by June 8, 2020. In the 2022 bear market it fell 23% and took 16.6 months to recover, regaining its peak in March 2024. Its deepest drop was 43.5%, from May to October 2008, and recovery took 27.8 months. 2008 was also its worst calendar year, at −19%. Anyone who has to cash out shares in a year like that may lock in losses.

The trailing 12-month yield was 2.71% as of October 27, 2026, paid twice a year. The SEC's standard example puts costs at $51 for the first year on $10,000. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).