# EDGAR Filing Document

**Accession Number:** 0001491978
**File Stem:** 0001193125-23-003221
**Filing Date:** 2023-1
**Character Count:** 2408573
**Document Hash:** 41eac0b1e14e159fa8bbf13f1c9b6321
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-003221.hdr.sgml**: 20230106

**ACCESSION NUMBER**: 0001193125-23-003221

**CONFORMED SUBMISSION TYPE**: N-CSR

**PUBLIC DOCUMENT COUNT**: 41

**CONFORMED PERIOD OF REPORT**: 20221031

**FILED AS OF DATE**: 20230106

**DATE AS OF CHANGE**: 20230106

**EFFECTIVENESS DATE**: 20230106

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** FLEXSHARES TRUST
- **CENTRAL INDEX KEY:** 0001491978
- **IRS NUMBER:** 272560399
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 1031

**FILING VALUES:**
- **FORM TYPE:** N-CSR
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-22555
- **FILM NUMBER:** 23514247

**BUSINESS ADDRESS:**
- **STREET 1:** 50 SOUTH LASALLE STREET
- **CITY:** CHICAGO
- **STATE:** IL
- **ZIP:** 60603
- **BUSINESS PHONE:** (855) 353-9383

**MAIL ADDRESS:**
- **STREET 1:** 50 SOUTH LASALLE STREET
- **CITY:** CHICAGO
- **STATE:** IL
- **ZIP:** 60603

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** FlexShares Trust
- **DATE OF NAME CHANGE:** 20110414

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** NT ETF Trust
- **DATE OF NAME CHANGE:** 20100513

## Series and Classes Contracts Data

### FlexShares Morningstar US Market Factor Tilt Index Fund (Series ID: S000033312)

| Class ID   | Class Name                                              | Ticker Symbol   |
|:---|:---|:---|
| C000102368 | FlexShares Morningstar US Market Factor Tilt Index Fund | TILT            |

### FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (Series ID: S000033313)

| Class ID   | Class Name                                                            | Ticker Symbol   |
|:---|:---|:---|
| C000102369 | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | TLTD            |

### FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (Series ID: S000033314)

| Class ID   | Class Name                                                     | Ticker Symbol   |
|:---|:---|:---|
| C000102370 | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | TLTE            |

### FlexShares Morningstar Global Upstream Natural Resources Index Fund (Series ID: S000033315)

| Class ID   | Class Name                                                          | Ticker Symbol   |
|:---|:---|:---|
| C000102371 | FlexShares Morningstar Global Upstream Natural Resources Index Fund | GUNR            |

### FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (Series ID: S000033316)

| Class ID   | Class Name                                              | Ticker Symbol   |
|:---|:---|:---|
| C000102372 | FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | TDTT            |

### FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (Series ID: S000034352)

| Class ID   | Class Name                                              | Ticker Symbol   |
|:---|:---|:---|
| C000105758 | FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | TDTF            |

### FlexShares Ready Access Variable Income Fund (Series ID: S000035596)

| Class ID   | Class Name                                   | Ticker Symbol   |
|:---|:---|:---|
| C000109007 | FlexShares Ready Access Variable Income Fund | RAVI            |

### FlexShares Quality Dividend Index Fund (Series ID: S000038873)

| Class ID   | Class Name                             | Ticker Symbol   |
|:---|:---|:---|
| C000119637 | FlexShares Quality Dividend Index Fund | QDF             |

### FlexShares Quality Dividend Dynamic Index Fund (Series ID: S000038874)

| Class ID   | Class Name                                     | Ticker Symbol   |
|:---|:---|:---|
| C000119638 | FlexShares Quality Dividend Dynamic Index Fund | QDYN            |

### FlexShares Quality Dividend Defensive Index Fund (Series ID: S000038875)

| Class ID   | Class Name                                       | Ticker Symbol   |
|:---|:---|:---|
| C000119639 | FlexShares Quality Dividend Defensive Index Fund | QDEF            |

### FlexShares International Quality Dividend Index Fund (Series ID: S000038876)

| Class ID   | Class Name                                           | Ticker Symbol   |
|:---|:---|:---|
| C000119640 | FlexShares International Quality Dividend Index Fund | IQDF            |

### FlexShares International Quality Dividend Dynamic Index Fund (Series ID: S000038877)

| Class ID   | Class Name                                                   | Ticker Symbol   |
|:---|:---|:---|
| C000119641 | FlexShares International Quality Dividend Dynamic Index Fund | IQDY            |

### FlexShares International Quality Dividend Defensive Index Fund (Series ID: S000038878)

| Class ID   | Class Name                                                     | Ticker Symbol   |
|:---|:---|:---|
| C000119642 | FlexShares International Quality Dividend Defensive Index Fund | IQDE            |

### FlexShares STOXX Global Broad Infrastructure Index Fund (Series ID: S000042071)

| Class ID   | Class Name                                              | Ticker Symbol   |
|:---|:---|:---|
| C000130666 | FlexShares STOXX Global Broad Infrastructure Index Fund | NFRA            |

### FlexShares Global Quality Real Estate Index Fund (Series ID: S000043008)

| Class ID   | Class Name                                       | Ticker Symbol   |
|:---|:---|:---|
| C000133169 | FlexShares Global Quality Real Estate Index Fund | GQRE            |

### FlexShares Disciplined Duration MBS Index Fund (Series ID: S000046193)

| Class ID   | Class Name                                     | Ticker Symbol   |
|:---|:---|:---|
| C000144481 | FlexShares Disciplined Duration MBS Index Fund | MBSD            |

### FlexShares Credit-Scored US Corporate Bond Index Fund (Series ID: S000047257)

| Class ID   | Class Name                                            | Ticker Symbol   |
|:---|:---|:---|
| C000148066 | FlexShares Credit-Scored US Corporate Bond Index Fund | SKOR            |

### FlexShares Credit-Scored US Long Corporate Bond Index Fund (Series ID: S000050613)

| Class ID   | Class Name                                                 | Ticker Symbol   |
|:---|:---|:---|
| C000159757 | FlexShares Credit-Scored US Long Corporate Bond Index Fund | LKOR            |

### FlexShares US Quality Large Cap Index Fund (Series ID: S000050614)

| Class ID   | Class Name                                 | Ticker Symbol   |
|:---|:---|:---|
| C000159758 | FlexShares US Quality Large Cap Index Fund | QLC             |

### FlexShares Real Assets Allocation Index Fund (Series ID: S000051556)

| Class ID   | Class Name                                   | Ticker Symbol   |
|:---|:---|:---|
| C000162239 | FlexShares Real Assets Allocation Index Fund | ASET            |

### FlexShares STOXX US ESG Select Index Fund (Series ID: S000054498)

| Class ID   | Class Name                                | Ticker Symbol   |
|:---|:---|:---|
| C000171075 | FlexShares STOXX US ESG Select Index Fund | ESG             |

### FlexShares STOXX Global ESG Select Index Fund (Series ID: S000054499)

| Class ID   | Class Name                                    | Ticker Symbol   |
|:---|:---|:---|
| C000171076 | FlexShares STOXX Global ESG Select Index Fund | ESGG            |

### FlexShares Core Select Bond Fund (Series ID: S000055516)

| Class ID   | Class Name                       | Ticker Symbol   |
|:---|:---|:---|
| C000174705 | FlexShares Core Select Bond Fund | BNDC            |

### FlexShares High Yield Value-Scored Bond Index Fund (Series ID: S000062125)

| Class ID   | Class Name                                         | Ticker Symbol   |
|:---|:---|:---|
| C000201101 | FlexShares High Yield Value-Scored Bond Index Fund | HYGV            |

### FlexShares US Quality Low Volatility Index Fund (Series ID: S000065837)

| Class ID   | Class Name                                      | Ticker Symbol   |
|:---|:---|:---|
| C000212719 | FlexShares US Quality Low Volatility Index Fund | QLV             |

### FlexShares Developed Markets ex-US Quality Low Volatility Index Fund (Series ID: S000065838)

| Class ID   | Class Name                                                           | Ticker Symbol   |
|:---|:---|:---|
| C000212720 | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | QLVD            |

### FlexShares Emerging Markets Quality Low Volatility Index Fund (Series ID: S000065839)

| Class ID   | Class Name                                                    | Ticker Symbol   |
|:---|:---|:---|
| C000212721 | FlexShares Emerging Markets Quality Low Volatility Index Fund | QLVE            |

### FlexShares ESG & Climate US Large Cap Core Index Fund (Series ID: S000073358)

| Class ID   | Class Name                                            | Ticker Symbol   |
|:---|:---|:---|
| C000230177 | FlexShares ESG & Climate US Large Cap Core Index Fund | FEUS            |

### FlexShares ESG & Climate Developed Markets ex-US Core Index Fund (Series ID: S000073359)

| Class ID   | Class Name                                                       | Ticker Symbol   |
|:---|:---|:---|
| C000230178 | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | FEDM            |

### FlexShares ESG & Climate Emerging Markets Core Index Fund (Series ID: S000073360)

| Class ID   | Class Name                                                | Ticker Symbol   |
|:---|:---|:---|
| C000230179 | FlexShares ESG & Climate Emerging Markets Core Index Fund | FEEM            |

### FlexShares ESG & Climate High Yield Corporate Core Index Fund (Series ID: S000073361)

| Class ID   | Class Name                                                    | Ticker Symbol   |
|:---|:---|:---|
| C000230180 | FlexShares ESG & Climate High Yield Corporate Core Index Fund | FEHY            |

### FlexShares ESG & Climate Investment Grade Corporate Core Index Fund (Series ID: S000073362)

| Class ID   | Class Name                                                          | Ticker Symbol   |
|:---|:---|:---|
| C000230181 | FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | FEIG            |

##### [**Table of Contents**](#toc)

------

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

------

**FORM N-CSR** 

------

**CERTIFIED SHAREHOLDER REPORT OF REGISTERED** 

**MANAGEMENT INVESTMENT COMPANIES** 

**Investment Company Act file number: 811-22555** 

------

## FlexShares<sup></sup>Trust
**(Exact name of registrant as specified in charter)** 

------

**50 South LaSalle Street** 

**Chicago, Illinois 60603** 

**(Address of principal executive offices) (Zip code)** 

------

**Michael Mabry, Esq.** 

**Stradley Ronon Stevens & Young, LLP** 

**2005 Market Street, Suite 2600** 

**Philadelphia, Pennsylvania 19103-6996** 

**(Name and Address of Agent for Service)** 

------

***with a copy to:***

**Himanshu Surti** 

**Jose Del Real, Esq.** 

**Northern Trust Investments, Inc.** 

**50 South LaSalle Street** 

**Chicago, Illinois 60603** 

**(Name and Address of Agent for Service)** 

------

**Registrant's telephone number, including area code: 855-353-9383** 

**Date of fiscal year end: October 31** 

**Date of reporting period: October 31, 2022** 

------

##### [**Table of Contents**](#toc)
**Item 1. Reports to Stockholders.** 

a.) The following is a copy of the report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).

------

##### [**Table of Contents**](#toc)
![LOGO](g402077g00c42.jpg)

## FlexShares<sup>®</sup> Trust

## Annual Report
October 31, 2022

![LOGO](g402077g61d60.jpg)

------

##### [**Table of Contents**](#toc)

------

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp; ![LOGO](g402077g63x96.jpg) | ![LOGO](g402077g88z19.jpg) |

---

------

**Table of Contents**

------

---

| | |
|:---|:---|
|  **[Letter to Shareholders](#tx402077_1)** | 2 |
|  **[Management's Discussion of Fund Performance](#tx402077_2)** | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> US Quality Low Volatility Index Fund](#tx402077_3) | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund](#tx402077_4) | 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund](#tx402077_5) | 7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund](#tx402077_6) | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund](#tx402077_7) | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund](#tx402077_8) | 13 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> US Quality Large Cap Index Fund](#tx402077_9) | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund](#tx402077_10) | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund](#tx402077_11) | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund](#tx402077_12) | 21 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund](#tx402077_13) | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund](#tx402077_14) | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund](#tx402077_15) | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund](#tx402077_16) | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Global Quality Real Estate Index Fund](#tx402077_17) | 31 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Real Assets Allocation Index Fund](#tx402077_18) | 33 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Index Fund](#tx402077_19) | 35 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund](#tx402077_20) | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund](#tx402077_21) | 39 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Index Fund](#tx402077_22) | 41 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund](#tx402077_23) | 43 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund](#tx402077_24) | 45 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund](#tx402077_25) | 47 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund](#tx402077_26) | 49 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund](#tx402077_27) | 51 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund](#tx402077_28) | 53 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund](#tx402077_29) | 55 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund](#tx402077_30) | 57 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund](#tx402077_31) | 60 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund](#tx402077_32) | 63 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Ready Access Variable Income Fund](#tx402077_33) | 65 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Core Select Bond Fund](#tx402077_34) | 67 |
|  **[Statements of Assets and Liabilities](#tx402077_35)** | 69 |
|  **[Statements of Operations](#tx402077_36)** | 77 |
|  **[Statements of Changes in Net Assets](#tx402077_37)** | 85 |
|  **[Financial Highlights](#tx402077_38)** | 101 |
|  **[Schedules of Investments](#tx402077_39)** | 134 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> US Quality Low Volatility Index Fund](#tx402077_40) | 134 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund](#tx402077_41) | 138 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund](#tx402077_42) | 144 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund](#tx402077_43) | 149 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund](#tx402077_44) | 188 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund](#tx402077_45) | 233 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> US Quality Large Cap Index Fund](#tx402077_46) | 284 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund](#tx402077_47) | 289 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund](#tx402077_48) | 296 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund](#tx402077_49) | 311 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund](#tx402077_50) | 316 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund](#tx402077_51) | 324 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund](#tx402077_52) | 331 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund](#tx402077_53) | 338 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Global Quality Real Estate Index Fund](#tx402077_54) | 344 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Real Assets Allocation Index Fund](#tx402077_55) | 349 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Index Fund](#tx402077_56) | 350 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund](#tx402077_57) | 356 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund](#tx402077_58) | 360 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Index Fund](#tx402077_59) | 364 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund](#tx402077_60) | 371 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund](#tx402077_61) | 378 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund](#tx402077_62) | 385 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund](#tx402077_63) | 386 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund](#tx402077_64) | 387 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund](#tx402077_65) | 392 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund](#tx402077_66) | 408 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund](#tx402077_67) | 417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund](#tx402077_68) | 438 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund](#tx402077_69) | 455 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Ready Access Variable Income Fund](#tx402077_70) | 464 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [FlexShares<sup>®</sup> Core Select Bond Fund](#tx402077_71) | 476 |
|  **[Notes to the Financial Statements](#tx402077_72)** | 478 |
|  **[Report of Independent Registered Public Accounting Firm](#tx402077_73)** | 533 |
|  **[Tax Information](#tx402077_74)** | 536 |
|  **[Fund Expenses](#tx402077_75)** | 538 |
|  **[Trustees and Officers](#tx402077_76)** | 542 |
|  **[Approval of Advisory Agreement](#tx402077_77)** | 546 |
|  **[Supplemental Information](#tx402077_78)** | 557 |
|  **[For More Information](#tx402077_79)** | 575 |

---

![LOGO](g402077g88z19.jpg)

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##### [**Table of Contents**](#toc)

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## Letter to Shareholders

------

Dear Shareholder,

In retrospect, there was no contest. The optimism with which many investors approached 2022, though by no means unfounded, could not prevail against the markets' most formidable adversary: Uncertainty.

A startling spike in inflation, an aggressive response by the Federal Reserve ("the Fed"), Russia's invasion of Ukraine, and the relative de-globalization of relations with China easily overshadowed the positive effects of recovering supply chains, solid employment numbers, rising wages and an active consumer.

While macroeconomic and geopolitical challenges are hardly unprecedented, encountering them simultaneously and at this magnitude is a distant memory for many investors and, for some, an entirely new phenomenon. It's no wonder, then, that we saw such a flight to perceived "safety" or to the sidelines, even though we believe that past experience argues for staying the course and maintaining a long-term perspective.

We enter 2023 with optimism, tempered with a healthy degree of caution. We believe stock valuations reflect potential risks, with many asset classes presenting compelling opportunities for investors. The slowing global economy has aided recent inflation trends, and we believe that if inflationary pressures continue to subside, it could allow the Fed to pause its rate hikes. Nevertheless, our opinion is that the possibility of a global recession is at its highest levels since the reopening of the global economy and even if we manage to avoid it, we believe below-trend growth appears likely.

Against this backdrop, we bring you our update for the FlexShares exchange-traded funds, sponsored and managed by Northern Trust Asset Management, for the year ended October 31, 2022. In addition to financial results for each fund, our portfolio managers explain the specific factors that influenced fund performance. As always, we encourage you to make the <u>Insights Section</u> on our website a destination for up to date analysis and perspective.

On behalf of all of us at Northern Trust and FlexShares, I want to thank you for your ongoing confidence and support.

We are proud to share our insights and acumen to help you navigate potential risks and identify opportunities within the marketplace.

Best wishes to you and yours for a joyous, productive, and rewarding new year.

Sincerely,

**Darek Wojnar, CFA** 

**Head, Funds & Managed Account Solutions, Northern Trust Asset Management** 

*The views in this letter were as of October 31, 2022 and may not necessarily reflect the same views on the date this letter is first published or any time thereafter. These views are intended to help shareholders in understanding the Funds' investment methodology and do not constitute investment advice.* 

*This report is submitted for the general information of the shareholders of the Funds. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus, which includes information regarding the Funds' risks, objectives, fees and expenses, experience of its management, and other information.* 

**An investment in the Funds' is subject to numerous risks, including possible loss of principal. Fund returns may not match the return of the respective indexes.** 

*Some of the risks include, but are not limited to, the following: asset class; commodity; concentration; counterparty; currency; derivatives; dividend; emerging markets; equity securities; fluctuation of yield; foreign securities; geographic; income; industry concentration; inflation protected securities; infrastructure-related companies; interest rate/ maturity risk; issuer; large cap; management; market; market trading; mid cap stock; MLP; momentum; natural resources; new funds; non-diversification; passive investment; privatization; small cap stock; tracking error; value investing; and volatility risk. A full description of risks is in each Fund's prospectus.* 

*Foreside Fund Services, LLC, distributor.* 

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| FlexShares<sup>®</sup> | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## US Quality Low Volatility Index Fund Ticker: QLV

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g01a01.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | |
|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **Fund<br>Inception<br>7/15/2019** |
|  FlexShares US Quality Low Volatility Index Fund (Based on Net Asset Value) | -7.12% | 8.78% | 8.39% |
|  FlexShares US Quality Low Volatility Index Fund (Based on Market Price) | -7.15% | 8.74% | 8.39% |
|  *Russell 1000<sup>®</sup> Index* | -16.38% | 9.98% | 9.38% |
|  *Northern Trust Quality Low Volatility Index* | -6.86% | 9.02% | 8.69% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Quality Low Volatility Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower absolute volatility characteristics relative to the Northern Trust 1250 Index (the "Parent Index"), a float-adjusted market capitalization weighted index of U.S. domiciled large- and mid-capitalization companies. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which Northern Trust Investments, Inc. ("NTI") believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2022, there were 121 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021, U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concern over rising inflation was intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to

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## US Quality Low Volatility Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>1</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate by 0.50% in May and by 0.75% in June, while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Because U.S. domestic investments trended down and were highly volatile during the 12 months ended October 31, 2022, we believe the low volatility<sup>2</sup> approach of the Underlying Index was a positive driver of Fund performance for the twelve-month period. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in key interest rates were conducive to high quality factor<sup>3</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the low volatility and quality factor exposures of the Underlying Index were the primary sources of the Underlying

Index's outperformance against the Russell 1000<sup>®</sup> Index<sup>4</sup> by 9.52%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -26 basis points ("bps")<sup>5</sup>, which is reflective of the management fee (-22 bps), stock selection/futures (-6 bps), and the compounding effect of tracking error over time (+2 bps).

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> Volatility is the measurement of the price movements of a group of stocks over a defined time frame.

<sup>3</sup> The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index.

<sup>4</sup> The Russell 1000<sup>®</sup> Index refers to a stock market index that represents the 1000 top companies in the United States.

<sup>5</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

4 FLEXSHARES ANNUAL REPORT

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| FlexShares<sup>®</sup> Developed | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Markets Ex-US Quality Low Volatility Index Fund Ticker: QLVD

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g03a03.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | |
|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **Fund<br>Inception<br>7/15/2019** |
|  FlexShares Developed Markets ex-US Quality Low Volatility Index Fund (Based on Net Asset Value) | -18.36% | -2.24% | -1.23% |
|  FlexShares Developed Markets ex-US Quality Low Volatility Index Fund (Based on Market Price) | -18.33% | -2.21% | -1.12% |
|  *MSCI World ex-US Index* | -22.04% | -0.49% | 0.17% |
|  *Northern Trust Developed Markets ex-US Quality Low Volatility Index* | -18.14% | -2.04% | -1.00% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.33% and the net expense ratio is 0.32%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Developed Markets ex-US Quality Low Volatility Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower overall absolute volatility characteristics relative to a broad universe of securities domiciled in developed market countries, excluding the U.S. (the "Parent Index"). The Parent Index is a subset of the Northern Trust Global Index, where eligible securities are limited to those securities domiciled in non-U.S. developed market countries and designated as large- and mid-capitalization companies by Northern Trust Investments, Inc. ("NTI"), acting in its capacity as the index provider. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which NTI believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2022, there were 172 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on Developed international equities generally traded lower. Over the course of the 12-month period the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising dollar. Through Q4 of 2021 Developed international equities were relatively flat as strength in European and U.K. investments due to resilient economic data from that region was offset by weakness in Asia Pacific equities. The emergence of the Omicron variant of Covid-19 weighed on investments in Hong Kong and Singapore as investors feared

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## Markets Ex-US Quality Low Volatility Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

additional lockdowns in China would impact their overall markets. Developed international investments declined in Q1 of 2022 as we believe Russia's invasion of Ukraine contributed to rising inflation and fears that energy supply shortages could impact economic growth. Investments in Hong Kong and Taiwan were also negatively impacted by a sharp rise in the number of Covid cases reported in China, leading to an increased number of cities being placed under lockdown. The selloff in developed international investments accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>1</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the U.S. dollar to strengthen in comparison to other developed market currencies. Developed international investments were generally higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes.

Because Developed international investments trended down and were highly volatile during the 12 months ended October 31, 2022, we believe the low volatility<sup>2</sup> approach of the Underlying Index was a positive driver of Fund performance for the twelve-month period. Additionally, we believe that the changes experienced in the macroeconomic environment and the higher overall interest rate environment were conducive to high quality companies within the Developed international universe. Consequently, the quality factor<sup>3</sup> focus of the Fund's Underlying Index was a positive driver of Fund performance for the 12-month period. Overall, the positive performance derived from both the low volatility and quality factor exposures were the primary sources of the Underlying Index's outperformance against the MSCI World ex-US Index<sup>4</sup> by 3.90%. The

tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -22 basis points ("bps")<sup>5</sup>, which is reflective of the Fund's management fee (-32 bps), stock selection/futures (+2 bps), securities lending (+1 bps), dividend tax differential (+2 bps), and the compounding effect of tracking error over time (+5 bps).

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> Volatility is the measurement of the price movements of a group of stocks over a defined time frame.

<sup>3</sup> The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index.

<sup>4</sup> The Morgan Stanley Capital International All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI) and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. 

<sup>5</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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| FlexShares<sup>®</sup> Emerging | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Markets Quality Low Volatility Index Fund Ticker: QLVE

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g04a04.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | |
|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **Fund<br>Inception<br>7/15/2019** |
|  FlexShares Emerging Markets Quality Low Volatility Index Fund (Based on Net Asset Value) | -19.77% | -3.93% | -3.53% |
|  FlexShares Emerging Markets Quality Low Volatility Index Fund (Based on Market Price) | -20.74% | -4.19% | -3.73% |
|  *MSCI Emerging Markets Index* | -31.03% | -4.42% | -4.25% |
|  *Northern Trust Emerging Markets Quality Low Volatility Index* | -19.14% | -3.16% | -2.76% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.41% and the net expense ratio is 0.40%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Emerging Markets Quality Low Volatility Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess lower overall absolute volatility characteristics relative to a broad universe of securities domiciled in emerging market countries (the "Parent Index"). The Parent Index is a subset of the Northern Trust Global Index, limited to those securities domiciled in emerging markets and designated as large- and mid- capitalization companies by Northern Trust Investments, Inc. ("NTI"), acting in its capacity as the index provider. In addition, the Underlying Index is designed to select companies from the Parent Index that exhibit financial strength, stability and enhanced risk-return characteristics, which NTI believes can provide equity-market participation while seeking to protect against downside risks during certain market environments. As of October 31, 2022, there were 148 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on emerging market equities generally traded lower. Over the course of the 12-month period, the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising USD. Through Q4 of 2021, emerging equities traded lower as the rapid spread of the Omicron variant of Covid-19 stoked fears that a new round of lockdowns in China would hinder growth in the region. Russian equities were the worst performing market as geopolitical tensions with the West worsened due to the buildup of Russian troops on its

FLEXSHARES ANNUAL REPORT 7

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| FlexShares<sup>®</sup> Emerging | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Markets Quality Low Volatility Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

border with Ukraine. Emerging markets continued to decline in Q1 of 2022 as Russia launched a full scale invasion into Ukraine and the U.S. and its European allies responded with sanctions. As part of these sanctions, Russian equity securities were removed from major emerging market indices in March. Increased Covid cases in China and the lockdown of several cities also weighed on markets. Due to rising commodity prices, equity markets in countries that export natural resources in Latin America and the Middle East were up for Q1 of 2022, but not enough to overcome the weakness in emerging markets in Europe and Asia Pacific. The selloff in emerging equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and USD strength increased the risk of a global recession. Emerging markets continued lower in October of 2022, driven primarily by declining China equity markets as Premier Xi was elected to a third five-year term, leading to speculation that nationalistic policies would be put in place that would limit China's growth.

Because emerging investments trended down and were highly volatile during the 12 months ended October 31, 2022, we believe the low volatility<sup>1</sup> approach of the Underlying Index was a positive driver of Fund performance for the twelve-month period. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in key interest rates were conducive to high quality factor<sup>2</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from both the low volatility and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance against the MSCI Emerging Markets Index<sup>3</sup> by 11.89%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -63 basis points ("bps")<sup>4</sup>, which

is reflective of the Fund's management fee (-40 bps), stock selection/futures (-21 bps), and the compounding effect of tracking error over time (-2 bps).

<sup>1</sup> Volatility is the measurement of the price movements of a group of stocks over a defined time frame.

<sup>2</sup> The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index.

<sup>3</sup> The Morgan Stanley Capital International Emerging Markets Index is a selection of stocks that are designed to track the financial performance of key companies in fast-growing nations.

<sup>4</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

8 FLEXSHARES ANNUAL REPORT

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## US Market Factor Tilt Index Fund Ticker: TILT

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g29c62.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/16/2011** |
|  FlexShares Morningstar US Market Factor Tilt Index Fund (Based on Net Asset Value) | -14.33% | 8.79% | 11.72% | 12.10% |
|  FlexShares Morningstar US Market Factor Tilt Index Fund (Based on Market Price) | -14.29% | 8.79% | 11.41% | 12.11% |
|  *Morningstar<sup>®</sup> U.S. Market Factor Tilt Index<sup>SM</sup>*  | -14.26% | 8.91% | 11.88% | 12.27% |

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*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.25%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar<sup>®</sup> US Market Factor Tilt Index (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to size and value factors relative to the Morningstar US Market Index (the "Parent Index"), a float-adjusted market-capitalization weighted index of U.S.-incorporated large-, mid-, small- and micro- capitalization companies. The Underlying Index seeks to achieve increased exposures to size and value factors, or a "factor tilt," by adjusting the Parent Index's constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc. pursuant to its index methodology. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader U.S. equity market by featuring size and value risk premiums, which Northern Trust Investments, Inc. ("NTI") believes have been historically demonstrated over a full market cycle. As of October 31, 2022, there were 2,558 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on U.S. domestic investments generally traded lower. During Q4 of 2021, U.S. domestic investments rose as economic data and strong corporate earnings suggested continued growth which allayed concerns over a potential spike in Covid cases. U.S. domestic investments declined in Q1 of 2022, however, as we believe investor concerns over rising inflation were intensified by Russia's invasion of Ukraine and the potential impact of sanctions from the U.S. and European countries on overall global commodity prices. To combat inflation, the Federal Reserve (Fed) raised the

FLEXSHARES ANNUAL REPORT 9

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## US Market Factor Tilt Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

benchmark key interest rate<sup>1</sup> 0.25% in March 2022 and signaled more aggressive key interest hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had positive performance in comparison to the technology and communication services sectors which were the worst performers. The downturn of U.S. domestic investments accelerated in Q2 of 2022 as the Fed moved forward with two more rounds of hikes of the key interest rate—0.50% in May and 0.75% in June—in an effort to combat rising inflation as seen in the Consumer Price Index.<sup>2</sup> Overall U.S. domestic investment fell as the Fed continued raising the key interest rate again with two 0.75% increases in July and September, respectively. In Q2 of 2022, Gross Domestic Product (GDP)<sup>3</sup> showed negative data year-over-year, marking the second consecutive quarter of negative growth. U.S. domestic investments overall rebounded in October of 2022, however, as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of U.S. domestic investments.

Because of the changes in growth expectations and the rising rate environment, U.S. domestic investments trended downward during the 12 months ended October 31, 2022. We believe the Morningstar value factor<sup>4</sup> was a positive driver of Fund performance during the fiscal year ended October 31, 2022, as value stocks outperformed growth stocks<sup>5</sup>. The Morningstar size factor<sup>6</sup> was also impacted by the changes in growth and interest rates and was a negative driver of Fund performance over the twelve months as small cap stocks underperformed large cap stocks. Overall, the positive performance derived from the Morningstar value factor was enough to offset the negative performance of the Morningstar size factor leading to the Underlying Index's outperformance against the Russell 3000 Index<sup>®</sup><sup>7</sup> by 2.26%. Tracking difference

between the Fund's NAV and the Underlying Index's total return for the 12-month period was -7 basis points ("bps")<sup>8</sup>, which is reflective of the management fee (-25 bps), stock selection/futures (+14 bps) and securities lending (+4 bps).

The Morningstar U.S. Market Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

<sup>3</sup> Gross Domestic Product (GDP) is seen as a comprehensive measure of U.S. economic activity which measures the value of the final goods and services produced in the United States.

<sup>4</sup> The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier.

<sup>5</sup> Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market.

<sup>6</sup> The Morningstar size factor measures a stock's total capitalization which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. 

<sup>7</sup> The Russell 3000 Index is a market-capitalization-weighted equity index that seeks to track 3000 of the largest U.S.-traded stocks.

<sup>8</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## Developed Markets ex-US Factor Tilt Index Fund Ticker: TLTD

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g46v27.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/25/2012** |
|  FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (Based on Net Asset Value) | -22.83% | -1.09% | 3.84% | 3.65% |
|  FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund (Based on Market Price) | -23.18% | -1.27% | 1.46% | 3.63% |
|  *Morningstar<sup>®</sup> Developed Markets ex-US Factor Tilt Index<sup>SM</sup>*  | -22.89% | -1.10% | 3.92% | 3.73% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.40% and the net expense ratio is 0.39%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar**<sup>®</sup>** Developed Markets ex-US Factor Tilt Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in the aggregate, possess greater exposure to size and value factors relative to the Morningstar Developed Markets ex-US Index (the "Parent Index"), a float adjusted market-capitalization weighted index of companies incorporated in developed-market countries, excluding the U.S. The Underlying Index seeks to achieve increased exposures to size and value factors, or a "factor tilt", by adjusting the Parent Index's constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc. pursuant to its index methodology. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader developed international equity market by featuring size and value risk premiums, which Northern Trust Investments, Inc. ("NTI") believes have been historically demonstrated over a full market cycle. As of October 31, 2022, there were 3,187 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on developed international equities generally traded lower. Over the course of the 12-month period, the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising dollar. Through Q4 of 2021, developed international markets were relatively flat as strength in the European and U.K. equity markets was offset by weakness is the Asia Pacific equity markets. The emergence of the Omicron variant of Covid-19 weighed on equities in Hong Kong and Singapore as investors feared additional lockdowns in China would impact these equity markets. Developed international equities declined in Q1 of 2022 as Russia's invasion of Ukraine contributed to rising inflation and

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## Developed Markets ex-US Factor Tilt Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

fears that energy supply shortages would impact economic growth. Equity markets in Hong Kong and Taiwan were also negatively impacted by a sharp rise in the number of Covid cases in China, leading to an increased number of cities being placed under lockdown. The selloff in developed international equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>1</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the USD to strengthen versus many developed market currencies. Developed international equities generally traded higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes in the near future.

Because of the changes in growth expectations and the rising rate environment, developed international investments trended downward during the 12 months ended October 31, 2022 and we believe the Morningstar value factor<sup>2</sup> was a positive driver of Fund performance during the fiscal year ended October 31, 2022 as value stocks outperformed growth stocks<sup>3</sup>. The Morningstar size factor<sup>4</sup>, however, was a negative driver of Fund performance over the twelve months as small cap stocks underperformed large cap stocks. Overall, the positive performance derived from the Morningstar value factor exposures of the Underlying Index offset the negative performance of the Morningstar size factor, leading to the Underlying Index's outperformance against the MSCI World ex-USA IMI Index<sup>5</sup> by 0.25%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was +6 basis points ("bps")<sup>6</sup>, which is reflective of the Fund's management fee (-39 bps), stock selection/futures (+17 bps), securities lending (+8 bps) and dividend tax differential (+20 bps).

The Morningstar Developed Markets ex-US Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier.

<sup>3</sup> Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market.

<sup>4</sup> The Morningstar size factor measures a stock's total capitalization, which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. 

<sup>5</sup> The Morgan Stanley Capital International World ex USA Investable Market Index captures large, mid and small cap representation across 22 of 23 Developed Markets (DM) countries – excluding the U.S.

<sup>6</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## Emerging Markets Factor Tilt Index Fund Ticker: TLTE

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g33j24.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/25/2012** |
|  FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (Based on Net Asset Value) | -27.32% | -3.05% | 0.79% | 0.70% |
|  FlexShares Morningstar Emerging Markets Factor Tilt Index Fund (Based on Market Price) | -27.75% | -3.22% | -1.43% | 0.67% |
|  *Morningstar<sup>®</sup> Emerging Markets Factor Tilt Index<sup>SM</sup>*  | -26.66% | -2.32% | 1.50% | 1.45% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.60% and the net expense ratio is 0.59%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar<sup>®</sup> Emerging Markets Factor Tilt Index SM (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater exposure to size and value factors relative to the Morningstar Emerging Markets Index (the "Parent Index"), a float-adjusted market-capitalization weighted index of companies incorporated in emerging-market countries. The Underlying Index seeks to achieve increased exposures to size and value factors, or a "factor tilt," by adjusting the Parent Index's constituent weights to achieve a slightly greater weight on companies with smaller market capitalizations or lower valuations, as determined by Morningstar, Inc., pursuant to its index methodology. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader emerging equity market by featuring size and value risk premiums, which Northern Trust Investments, Inc. believes have been historically demonstrated over a full market cycle. As of October 31, 2022, there were 3,293 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on emerging market equities generally traded lower. Over the course of the 12-month period, the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising USD. Through Q4 of 2021, emerging equities traded lower as the rapid spread of the Omicron variant of Covid-19 stoked fears that a new round of lockdowns in China would hinder growth in the region. Russian equities were the worst performing market as geopolitical tensions with the West worsened due to the buildup of Russian troops on its border with Ukraine. Emerging markets continued to decline in Q1 of 2022 as Russia launched a full scale invasion into Ukraine and the U.S. and its European allies responded with sanctions. As part of

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## Emerging Markets Factor Tilt Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

these sanctions, Russian equity securities were removed from major emerging market indices in March. Increased Covid cases in China and the lockdown of several cities also weighed on markets. Due to rising commodity prices, equity markets in countries that export natural resources in Latin America and the Middle East were up for Q1 of 2022, but not enough to overcome the weakness in emerging markets in Europe and Asia Pacific. The selloff in emerging equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and USD strength increased the risk of a global recession. Emerging markets continued lower in October of 2022 driven primarily by declining China equity markets as Premier Xi was elected to a third five-year term, leading to speculation that nationalistic policies would be put in place that would limit China's growth.

Investors showed a preference for value companies in emerging markets for the twelve months ending October 31, 2022, resulting in the high Morningstar value factor<sup>1</sup> exposure being a positive driver of Fund performance as value stocks outperformed growth stocks.<sup>2</sup> In addition, the Morningstar size factor<sup>3</sup> was a positive driver of Fund performance over the twelve months as small cap stocks outperformed large cap stocks. Overall, the positive performance derived from the Morningstar value and size factor exposures of the Underlying Index was the primary source of the Underlying Index's outperformance against the MSCI EM IMI Net Index<sup>4</sup> by 3.43%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -66 basis points ("bps")<sup>5</sup>, which is reflective of the Fund's management fee (-59 bps), stock selection/futures (-12 bps), securities lending (+5 bps) and dividend tax differential (+1 bps), performance calculation differences between the Underlying Index and the Fund (-1 bp), India Capital Gains Taxes (-1 bps) and compounding of tracking error over time (+1 bps).

The Morningstar Emerging Markets Factor Tilt Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>1</sup> The Morningstar value factor seeks to identify stocks that are inexpensive relative to some measure of fundamental value (e.g., low price/book, low price/earnings, high dividend yields, etc.), which could result in outperformance relative to those that are pricier.

<sup>2</sup> Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market.

<sup>3</sup> The Morningstar size factor measures a stock's total capitalization, which can be found by multiplying the current share price by all the outstanding shares of the stock, and seeks to overweight smaller capitalization stocks. 

<sup>4</sup> The Morgan Stanley Capital International Emerging Markets Investable Market Index (IMI) captures large, mid and small cap representation across 27 Emerging Markets (EM) countries.

<sup>5</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## US Quality Large Cap Index Fund Ticker: QLC

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g31s76.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>9/23/2015** |
|  FlexShares US Quality Large Cap Index Fund Index Fund (Based on Net Asset Value) | -12.98% | 9.08% | 7.97% | 9.73% |
|  FlexShares US Quality Large Cap Index Fund Index Fund (Based on Market Price) | -12.88% | 9.09% | 7.91% | 9.74% |
|  *S&P 500 Index* | -14.61% | 10.21% | 10.44% | 12.31% |
|  *Northern Trust Quality Large Cap Index<sup>SM</sup>*  | -12.71% | 9.40% | 8.25% | 10.06% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. Prior to July 11, 2022, the gross expense ratio of the Fund was 0.33% and the net expense ratio was 0.32%. Effective July 11, 2022, the gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.26%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Quality Large Cap Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater exposure to quality, value and momentum factors relative to a universe of publicly traded U.S. large-capitalization equity securities. The universe is comprised of the 600 largest companies in the Northern Trust 1250 Index, a float- adjusted market-capitalization weighted index of U.S. domiciled companies. The Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the broader U.S. large-cap equity market by featuring quality, value and momentum risk premiums, which Northern Trust Investments, Inc. ("NTI") believes have been historically demonstrated over a full market cycle. As of October 31, 2022, there were 173 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>1</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as

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## US Quality Large Cap Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate by 0.50% in May and by 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Because of the changes in growth expectations and the rising rate environment, U.S. domestic investments trended downward during the 12 months ended October 31, 2022 and we believe the value factor<sup>2</sup> was a positive driver of Fund performance during the fiscal year ended October 31, 2022 as value stocks outperformed growth stocks<sup>3</sup>. In addition, we believe that investors showed a preference for high quality factor<sup>4</sup> companies within the large cap universe utilized by the Underlying Index, resulting in the high-quality factor exposure enhancing Fund performance over the 12 months. The momentum factor exposure<sup>5</sup> of the Underlying Index was also a positive driver of Fund performance as positive momentum companies outperformed negative momentum companies over the twelve months. Overall, the positive performance from the value, quality and momentum exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance relative to the

S&P 500 Index<sup>6</sup> by 1.90%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -27 basis points ("bps")<sup>7</sup>, which is reflective of the management fee (-25 bps), stock selection/futures (-5 bps), securities lending (+1 bps), performance calculation differences between the Underlying Index and the Fund (+1 bps) and compounding of tracking error over time (+1 bps).

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> The value factor is a factor reflecting the current worth of a company relative to its own historical value, book value, or valuation versus peers.

<sup>3</sup> Growth stocks are defined as those issued by companies that are anticipated to grow at a rate significantly above the average for the market.

<sup>4</sup> The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the market.

<sup>5</sup> The momentum factor is a factor that reflects market sentiment and changes in security price over a given time period.

<sup>6</sup> The Standard & Poor's 500 Index is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## STOXX<sup>®</sup> US ESG Select Index Fund Ticker: ESG

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g55o66.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>7/13/2016** |
|  FlexShares STOXX<sup>®</sup> US ESG Select Index Fund (Based on Net Asset Value) | -16.51% | 10.27% | 10.61% | 12.02% |
|  FlexShares STOXX<sup>®</sup> US ESG Select Index Fund (Based on Market Price) | -16.52% | 10.27% | 10.59% | 12.03% |
|  *Russell 1000<sup>®</sup> Index* | -16.38% | 9.98% | 10.20% | 11.60% |
|  *STOXX<sup>®</sup> USA ESG Select KPIs Index* | -16.61% | 10.07% | 10.13% | 11.53% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.33% and the net expense ratio is 0.32%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX USA ESG Select KPIs Index ("Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, score better with respect to a set of environmental, social and governance ("ESG") key performance indicators relative to the U.S. companies in the STOXX Global 1800 Index, a float adjusted market-capitalization weighted index of companies incorporated in the U.S. and in developed international markets. As of October 31, 2022, there were 271 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>1</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

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## STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

The Underlying Index had a negative total return during the 12 months ended October 31, 2022, and underperformed domestic equity markets, as defined by the Russell 1000<sup>®</sup> Index<sup>2</sup> by -0.23%. The Underlying Index's ESG-tilted approach led to overweight Fund exposure to the communication services and consumer discretionary sectors that detracted from Fund performance. Likewise, the ESG tilt led to underweights to the industrials, consumer staples, materials and utilities sectors that were negative drivers of Fund performance. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was +10 basis points ("bps")<sup>3</sup>, which is reflective of the management fee (-32 bps), stock selection/futures (-4 bps) and dividend tax differential (+46 bps).

The STOXX USA ESG Select KPIs Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>2</sup> The Russell 1000<sup>®</sup> Index refers to a stock market index that represents the 1000 top companies in the United States.

<sup>3</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

18 FLEXSHARES ANNUAL REPORT

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## STOXX<sup>®</sup> Global ESG Select Index Fund Ticker: ESGG

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g88r72.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>7/13/2016** |
|  FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund (Based on Net Asset Value) | -19.35% | 6.71% | 6.93% | 9.35% |
|  FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund (Based on Market Price) | -19.55% | 6.70% | 6.89% | 9.35% |
|  *MSCI World Index* | -18.48% | 6.11% | 6.37% | 8.55% |
|  *STOXX<sup>®</sup> Global ESG Select KPIs Index* | -19.30% | 6.79% | 6.99% | 9.37% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.43% and the net expense ratio is 0.42%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX Global ESG Select KPIs Index (the "Underlying Index") The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, score better with respect to a set of environmental, social and governance ("ESG") key performance indicators relative to the STOXX Global 1800 Index, the parent index, a float-adjusted market-capitalization weighted index of companies incorporated in the U.S. and in developed international markets. As of October 31, 2022, there were 887 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on global equities generally traded lower. Through Q4 of 2021 global equity markets rose as economic data suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. Global equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. The selloff in global equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. Global equities traded higher in October of 2022 as corporate earnings reported over the month were generally better than expected.

The Underlying Index had a negative total return during the 12 months ended October 31, 2022 and underperformed global equity markets, as defined by the MSCI World Index<sup>1</sup>, by -0.82%. The Underlying

<sup>1</sup> The Morgan Stanley Capital International World Index captures large and mid-cap representation across 23 Developed Markets countries.

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## STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

Index's ESG-tilted approach led to underweight Fund exposure to the industrials, utilities and financials sectors as well as an overweight to the consumer discretionary sector that detracted from Fund performance. The ESG tilt also led to overweights to the healthcare and technology sectors that were beneficial to Fund performance. Overall the overweights to healthcare and technology were not enough to overcome the negative performance in other sector overweights and underweights and the Underlying Index underperformed the MSCI World Index. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -5 basis points ("bps")<sup>2</sup>, which is reflective of the management fee (-42 bps), stock selection/futures (-2 bps), securities lending (+1 bps), dividend tax differential (+39 bps), and compounding of tracking error over time (-1 bps).

The STOXX Global ESG Select KPIs Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>2</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

20 FLEXSHARES ANNUAL REPORT

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## US Large Cap Core Index Fund Ticker: FEUS

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g11k02.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | |
|:---|:---|:---|
|  | **1 Year** | **Fund<br>Inception<br>9/20/2021** |
|  FlexShares ESG & Climate US Large Cap Core Index Fund (Based on Net Asset Value) | -16.09% | -9.40% |
|  FlexShares ESG & Climate US Large Cap Core Index Fund (Based on Market Price) | -16.07% | -9.40% |
|  *S&P 500 Index* | -14.61% | -8.73% |
|  *Northern Trust ESG & Climate US Large Cap Core Index* | -16.08% | -9.35% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.10% and the net expense ratio is 0.09%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate US Large Cap Core Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance ("ESG") characteristics, while also seeking to provide broad-market, core exposure to publicly-traded U.S. large capitalization equity securities, i.e., the 600 largest companies in the Northern Trust 1250 Index<sup>SM</sup> (the "Starting Universe"), as measured by largest float adjusted market capitalization. The Underlying Index is designed to minimize tracking differences relative to the Starting Universe, while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Starting Universe. As of October 31, 2022, there were 185 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>1</sup> by 0.25% in March

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

FLEXSHARES ANNUAL REPORT 21

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## US Large Cap Core Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Surging commodity prices and concerns over natural resource shortages had a negative impact on the climate-related tilt of the Fund as companies that scored poorer on carbon-related measures outperformed during the 12 months ended October 31, 2022. In addition, companies with higher ESG characteristics also were a negative driver of Fund performance over the 12 months. Overall, the negative performance from the climate-related risk reduction and the aggregate higher ESG characteristics of the Underlying Index were the primary sources of the Underlying Index's underperformance relative to the S&P 500 Index<sup>2</sup> by -1.47%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -1 basis point ("bps")<sup>3</sup>, which is reflective of the management fee

(-9 bps), stock selection/futures (+6 bps), performance calculation differences between the Underlying Index and the Fund (+1 bps) and compounding of tracking error over time (+1 bps).

<sup>2</sup> The Standard & Poor's 500 Index is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S.

<sup>3</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

22 FLEXSHARES ANNUAL REPORT

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## Developed Markets ex-US Core Index Fund Ticker: FEDM

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g11k03.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | |
|:---|:---|:---|
|  | **1 Year** | **Fund**<br> **Inception**<br> **9/20/2021** |
|  FlexShares ESG & Climate Developed Markets Ex-US Core Index Fund (Based on Net Asset Value) | -23.36% | -19.59% |
|  FlexShares ESG & Climate Developed Markets Ex-US Core Index Fund (Based on Market Price) | -23.47% | -19.39% |
|  *MSCI World ex-US Index* | -22.04% | -18.81% |
|  *Northern Trust ESG & Climate Developed Markets ex-US Core Index* | -23.43% | -19.73% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.13% and the net expense ratio is 0.12%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Developed Markets ex-US Core Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance ("ESG") characteristics, while also seeking to provide broad-market, core exposure to publicly traded equity securities issued by companies domiciled in developed market countries, excluding the U.S. The Underlying Index is designed to minimize tracking differences relative to the Northern Trust Developed Markets ex-US Large Cap Index<sup>SM</sup> (the "Parent Index"), while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2022, there were 309 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on developed international equities generally traded lower. Over the course of the 12-month period the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising USD. Through Q4 of 2021, developed international markets were relatively flat as strength in the European and U.K. equity markets was offset by weakness is the Asia Pacific equity markets. The emergence of the Omicron variant of Covid-19 weighed on equities in Hong Kong and Singapore as investors feared additional lockdowns in China would impact these equity markets.

FLEXSHARES ANNUAL REPORT 23

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## Developed Markets ex-US Core Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

Developed international equities declined in Q1 of 2022 as Russia's invasion of Ukraine contributed to rising inflation and fears that energy supply shortages would impact economic growth. Equity markets in Hong Kong and Taiwan were also negatively impacted by a sharp rise in the number of Covid cases in China, leading to an increased number of cities being placed under lockdown. The selloff in developed international equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>1</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the USD to strengthen versus many developed international market currencies. Developed international equities generally traded higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes in the near future.

Surging commodity prices and concerns over natural resource shortages had a negative impact on the climate-related tilt of the Fund as companies that scored poorer on carbon-related measures outperformed during the 12 months ended October 31, 2022. In addition, companies with higher ESG characteristics also were a negative driver of Fund performance over the 12 months. Overall, the negative performance from the climate-related risk reduction and the aggregate higher ESG characteristics of the Underlying Index were the primary sources of the Underlying Index's underperformance relative to the MSCI World ex-US Index<sup>2</sup> by -1.39%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was +7 basis points ("bps")<sup>3</sup>, which is reflective of

the management fee (-12 bps), stock selection/futures (+19 bps), dividend tax differential (+2 bps), and compounding of tracking error over time (-2 bps).

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> The MSCI World ex USA Index captures large and mid cap representation across 22 of 23 Developed Markets (DM) countries\*— excluding the United States.

<sup>3</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

24 FLEXSHARES ANNUAL REPORT

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## Emerging Markets Core Index Fund Ticker: FEEM

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g11k04.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | |
|:---|:---|
|  | **Fund**<br> **Inception<br>4/20/2022** |
|  FlexShares ESG & Climate Emerging Markets Core Index Fund (Based on Net Asset Value) | -21.47% |
|  FlexShares ESG & Climate Emerging Markets Core Index Fund (Based on Market Price) | -21.00% |
|  *MSCI Emerging Markets Index* | -21.06% |
|  *Northern Trust ESG & Climate Emerging Markets Core Index* | -21.66% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Emerging Markets Core Index<sup>SM</sup> (the "Underlying Index") The Underlying Index is designed to reflect the performance of a selection of companies that exhibit certain environmental, social and governance ("ESG") characteristics, while also seeking to provide broad-market, core exposure to publicly traded equity securities issued by companies domiciled in emerging market countries. The Underlying Index is designed to minimize tracking differences relative to the Northern Trust Emerging Markets Large Cap Index<sup>SM</sup> (the "Parent Index"), while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score, and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2022, there were 251 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the period ending October 31, 2022<sup>1</sup>, prices on emerging market equities generally traded lower. Over the course of the period ending October 31, 2022, the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising of the dollar. Through Q2 and Q3 of 2022 emerging equities traded lower as Russia's invasion of Ukraine continued and the U.S. and its European allies responded with sanctions. The selloff was also impacted by rising inflation, energy shortages and USD strength that increased the risk of a global

<sup>1</sup> The Fund commenced investment operations on April 20, 2022.

FLEXSHARES ANNUAL REPORT 25

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## Emerging Markets Core Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

recession. Emerging markets continued lower in October of 2022 driven primarily by declining China equity markets as Premier Xi was elected to a third five-year term, leading to speculation that nationalistic policies would be put in place that would limit China's growth.

From inception through October 31, 2022 the total return for the Fund was -21.47% compared to the MSCI Emerging Markets Index<sup>2</sup> that returned -21.06%. Surging commodity prices and concerns over natural resource shortages had a negative impact on the climate-related tilt of the Fund as companies that scored poorer on carbon-related measures outperformed during the period from inception through October 31, 2022. In addition, companies with higher ESG characteristics also were a negative driver of Fund performance over the period ending October 31, 2022. Overall, the negative performance from the climate-related risk reduction and the aggregate higher ESG characteristics of the Underlying Index were the primary sources of the Underlying Index's underperformance relative to the MSCI World ex-US Index by -36 basis points ("bps")<sup>3</sup>. Tracking difference between the Fund's NAV and the Underlying Index's total return for the period from inception through October 31, 2022 was +19 bps, which is reflective of the management fee (-9 bps), stock selection/futures (+18 bps), performance calculation differences between the Underlying Index and the Fund (+1 bps) and compounding of tracking error over time (+9 bps).

26 FLEXSHARES ANNUAL REPORT

<sup>2</sup> The MSCI Emerging Markets Index captures large and mid cap representation across 24 Emerging Markets (EM) countries.

<sup>3</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## Global Upstream Natural Resources Index Fund Ticker: GUNR

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g85q60.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/16/2011** |
|  FlexShares Morningstar Global Upstream Natural Resources Index Fund (Based on Net Asset Value) | 12.20% | 9.34% | 4.88% | 4.45% |
|  FlexShares Morningstar Global Upstream Natural Resources Index Fund (Based on Market Price) | 12.01% | 9.30% | 4.85% | 4.46% |
|  *Morningstar<sup>®</sup> Global Upstream Natural Resources Index<sup>SM</sup>*  | 12.96% | 9.93% | 5.36% | 4.88% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.47% and the net expense ratio is 0.46%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Morningstar Global Upstream Natural Resources Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index reflects the performance of a selection of equity securities that are traded in or are issued by companies classified as developed or emerging markets (including the U.S.), as determined by Morningstar, Inc., the index provider, pursuant to its index methodology. The companies included in the Underlying Index have significant business operations in the ownership, management and/or production of natural resources in energy, agriculture, precious or industrial metals, timber and water resources sectors, as determined by the index provider, pursuant to its index methodology. As of October 31, 2022, there were 120 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective and a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on global equities generally traded lower. Through Q4 of 2021, U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. Commodity and natural resources prices surged in Q1 of 2022 as we believe investor concerns over rising inflation were intensified by Russia's invasion of Ukraine and the potential impact of sanctions from the U.S. and European countries on overall global commodity prices. As part of these sanctions, Russian equity securities were removed from market indices in early March. Many commodity and natural resources prices moved higher during the fiscal year, especially crude oil, refined oil products and grains. Supplies of these raw materials from Russia and Ukraine were disrupted leading to concerns over shortages in 2022 and beyond. The sudden removal of energy supplies in Q1 of 2022 due to sanctions against Russian energy exports, combined by production discipline by the Organization of Petroleum Exporting

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## Global Upstream Natural Resources Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

Countries (OPEC) and limitations on oilfield equipment and labor all combined to lower global supplies while energy demand remained fairly steady. European natural gas price increases reached record highs as Russia severally restricted supplies. West Texas Intermediate ("WTI") crude oil prices began the fiscal year near $84 per barrel, spiked to over $120 per barrel in March and again in Q3 of 2022 eventually ending the fiscal year over $85 per barrel<sup>1</sup>. U.S. natural gas futures were up nearly 53%<sup>2</sup> during the same time span, while Euro natural gas futures were 30% higher after raising as much as 380%<sup>3</sup> by August.

In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>4</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q2 of 2022, the Fed moved forward with two more rounds of key interest rate rate hikes in an effort to combat rising inflation as seen in the Consumer Price Index.<sup>5</sup> The Fed continued raising the key interest rate again with two 0.75% increases in July and September. Due to these continuing key interest rate hikes, the U.S. dollar (USD) rose significantly in comparison to other global currencies. A stronger USD is typically a negative for global commodity prices and negatively impacts U.S. investors' returns on foreign equity holdings.

Overall Industrial metals prices, such as copper, aluminum, zinc and tin were lower for the fiscal year. Prices fell during the period as China, the top marginal consumer of many of these metals, shutdown major areas of the country due to the country's zero-COVID virus policy. Additionally, China's real estate sector saw a slowdown due to the COVID shutdowns and leverage concerns among many property developers, thereby slowing construction. Prices were volatile during the period as concerns over supplies normally derived from Russia plus the uncertainty over future global growth with tightening Central Bank monetary policies and the European energy crisis. Precious metals prices were lower as higher interest rates and the strong USD lessened demand. Lithium saw strong price performance due to increasing environmental battery demand and continued challenges in supplies.

Grains posted strong price performance for a third straight year as the Ukraine conflict, droughts in Europe and other grain growing regions limited global supplies. Protein prices (cattle, hogs, poultry, and fish) also posted strong price performance. U.S. fertilizer chemicals (potash, nitrogen, phosphate) were all materially higher on increased input costs, supply constraints and global demand. U.S. lumber prices were especially volatile during the fiscal year. Continued housing demand combined with lumber mill capacity issues drove lumber futures prices<sup>6</sup> up significantly by end of Q1 of 2022. We believe once U.S. mortgage rates moved higher in response to the change in the Fed's monetary policy and housing demand fell, lumber futures subsequently declined by the end of the fiscal year.

For the 12-month period ended October 31, 2022, the Underlying Index outperformed the global natural resource equity markets, as defined by the S&P Global Natural Resources Index<sup>7</sup>, by +681 basis points (bps)<sup>8</sup>. Due to the Underlying Index's focus on the upstream section of the natural resource supply chain, security selection in Energy aided returns. Sector allocation and security selection in Agriculture, Metals and Timber also benefitted performance versus the benchmark. The Water Resources sector was a drag on performance as higher interest rates negatively impacted returns due to the capital intensive nature of the sector. Tracking difference for the period between the Fund's NAV and the Underlying Index was -76 bps, which is reflective of the Fund's management fee (-46 bps), futures (-19 bps), foreign dividend tax differential treatment (+4 bps), securities lending (+3 bps), security selection (-1 bps), transaction costs (-3 bps), and other expenses including compounding of expenses during rising markets (-14 bps).

The Morningstar Global Upstream Natural Resources Index is the intellectual property (including registered trademarks) of Morningstar and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Morningstar and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>1</sup> Source: Bloomberg, USCRWTIC Index (October 31, 2021 – October 31, 2022).

<sup>2</sup> Source: Bloomberg, NGUSHHUB Commodity (October 31, 2021 – October 31, 2022).

<sup>3</sup> Source: Bloomberg, TTFG1MON Commodity (October 31, 2021 – October 31, 2022).

<sup>4</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>5</sup> The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

<sup>6</sup> Source: Bloomberg, LB1 Lumber Generic Near Term Commodity Contract (October 31, 2021 – October 31, 2022).

<sup>7</sup> The Standard & Poor's Global Natural Resources Index includes 90 of the largest publicly-traded companies in natural resources and commodities businesses that meet specific investability requirements, offering investors diversified and investable equity exposure across 3 primary commodity-related sectors: agribusiness, energy, and metals & mining. 

<sup>8</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

28 FLEXSHARES ANNUAL REPORT

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## Global Broad Infrastructure Index Fund Ticker: NFRA

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g96f79.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>10/8/2013** |
|  FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (Based on Net Asset Value) | -13.92% | -0.28% | 2.85% | 4.80% |
|  FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (Based on Market Price) | -13.90% | -0.26% | 2.87% | 4.81% |
|  *STOXX<sup>®</sup> Global Broad Infrastructure Index* | -13.99% | -0.39% | 2.73% | 4.70% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX Global Broad Infrastructure Index (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, offer broad exposure to publicly traded developed- and emerging-market infrastructure companies, including U.S. companies, as defined by STOXX Ltd. ("STOXX") pursuant to its index methodology. As of October 31, 2022, there were 176 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on global equities generally traded lower. Through Q4 of 2021 global equity markets rose as economic data suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. Global equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. As part of these sanctions, Russian equity securities were removed from major global indices in March of 2022. The selloff in global equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. Global equities traded higher in October of 2022 as corporate earnings reported over the month were generally better than expected.

The Underlying Index had a negative total return during the 12 months ended October 31, 2022, and underperformed the global infrastructure market, as defined by

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## Global Broad Infrastructure Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

the S&P Global Infrastructure Index,<sup>1</sup> by -8.56%. The Underlying Index's exposures to the communication, energy, utilities and social infrastructure sectors negatively contributed to Fund performance, while exposure to transportation infrastructure positively benefited Fund performance. The tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was +7 basis points ("bps")<sup>2</sup>, which is reflective of the Fund's management fee (-47 bps), stock selection/futures (+5 bps), securities lending (+3 bps), dividend tax differential (+49 bps), India Cap Gain Taxes (-1 bps) and compounding of tracking error over time (-2 bps).

The STOXX Global Infrastructure Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by STOXX and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>1</sup> The S&P Global Infrastructure Index is designed to track 75 companies from around the world chosen to represent the listed infrastructure industry while maintaining liquidity and tradability.

<sup>2</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

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## Global Quality Real Estate Index Fund Ticker: GQRE

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g11k01.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>11/5/2013** |
|  FlexShares Global Quality Real Estate Index Fund (Based on Net Asset Value) | -23.51% | -5.01% | -0.46% | 3.33% |
|  FlexShares Global Quality Real Estate Index Fund (Based on Market Price) | -23.82% | -5.09% | -0.52% | 3.32% |
|  *FTSE EPRA/NAREIT Developed Index<sup>SM</sup>*  | -24.95% | -6.32% | -0.17% | 2.20% |
|  *Northern Trust Global Quality Real Estate Index<sup>SM</sup>*  | -23.75% | -5.26% | -0.60% | 3.22% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.46% and the net expense ratio is 0.45%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Global Quality Real Estate Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater exposure to quality, value and momentum factors relative to the Northern Trust Global Real Estate Index (the "Parent Index"), a float-adjusted market-capitalization weighted index of publicly traded equity securities of U.S. and non-U.S. real estate investment trusts and real estate operating companies. In addition, the Underlying Index is designed to include companies with enhanced risk-return characteristics relative to the global publicly traded real-estate market by featuring quality, value and momentum risk premiums, which Northern Trust Investments, Inc. ("NTI") believes have been historically demonstrated over a full market cycle. As of October 31, 2022, there were 145 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on global equities generally traded lower. Through Q4 of 2021 global equity markets rose as economic data suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. Global equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. As part of these sanctions, Russian equity securities were removed from major global indices in March of 2022. The selloff in global equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a

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## Global Quality Real Estate Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

global recession. Global equities traded higher in October of 2022 as corporate earnings reported over the month were generally better than expected.

The Underlying Index had a negative total return during the 12 months ended October 31, 2022, but outperformed the global equity real estate markets, as defined by the FTSE EPRA/NAREIT Developed Net Index<sup>1</sup>, by 1.20%. The quality<sup>2</sup> and momentum<sup>3</sup> factor exposures of the Underlying Index were positive drivers of Fund performance while the value<sup>4</sup> factor exposure was a negative driver of Fund performance. Overall, the positive exposure to quality and momentum was enough to offset the headwinds from the negative performance derived from the value exposure. Tracking difference between the Fund's NAV and the Underlying Index's total return for the period was +24 basis points ("bps")<sup>5</sup>, which is reflective of the Fund's management fee (-45 bps), stock selection/futures (+34 bps), securities lending (+2 bps), dividend tax differential (+37 bps), performance calculation differences between the Underlying Index and the Fund (-1 bp) and compounding of tracking error over time (-3 bps).

<sup>1</sup> The FTSE EPRA/NAREIT Developed Net Index is an index designed to track the performance of listed real estate companies in both developed and emerging countries worldwide.

<sup>2</sup> The quality factor is a factor that seeks to identify companies that exhibit financial strength and stability relative to the Parent Index.

<sup>3</sup> The momentum factor is a factor that reflects market sentiment and changes in a security price over a given time period.

<sup>4</sup> The value factor is a factor reflecting the current worth of a company relative to its own historical value, book value or valuation versus peers.

<sup>5</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

32 FLEXSHARES ANNUAL REPORT

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## Real Assets Allocation Index Fund Ticker: ASET

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g82b87.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>11/23/2015** |
|  FlexShares Real Assets Allocation Index Fund (Based on Net Asset Value) | -11.49% | 1.19% | 3.40% | 5.03% |
|  FlexShares Real Assets Allocation Index Fund (Based on Market Price) | -11.46% | 1.18% | 3.34% | 5.05% |
|  *MSCI ACWI Index* | -19.96% | 4.84% | 5.24% | 7.29% |
|  *Northern Trust Real Assets Allocation Index<sup>SM</sup>*  | -11.34% | 1.32% | 3.52% | 5.16% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 1.05% and the net expense ratio is 0.57%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Real Assets Allocation Index<sup>SM</sup> (the "Underlying Index"). The Fund is a fund of funds and seeks to achieve its investment objective by investing primarily in the shares of other FlexShares ETFs (each an "Underlying Fund," and together, the "Underlying Funds") that are eligible for inclusion in the Underlying Index, rather than in securities of individual companies. The Underlying Funds themselves seek investment results corresponding to their own respective underlying indexes. The Underlying Funds invest primarily in separate sets of securities representing or providing exposures to global "real assets." Real assets are defined by the index provider as physical or tangible assets. Examples of real assets include but are not limited to commodities, precious metals, oil, and real estate. Each Underlying Fund has its own risk profile and will contribute differently to the overall risk profile of the Fund. Each of the Underlying Funds invests in equity securities that are traded in or are issued by companies domiciled in global developed or emerging markets (including the U.S.). Certain of the Underlying Funds may invest in publicly traded units of master limited partnerships and real estate investment trusts. As of October 31, 2022, there were three Underlying Funds in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. "Representative sampling" means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on global equities generally traded lower. Through Q4 of 2021 global equity markets rose as economic data suggested continued growth, allaying concerns

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## Real Assets Allocation Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

over a spike in Covid cases due to the Omicron variant. Global equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. As part of these sanctions, Russian equity securities were removed from major global indices in March of 2022. The selloff in global equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. Global equities traded higher in October of 2022 as corporate earnings reported over the month were generally better than expected.

The Underlying Index had a negative total return during the 12 months ended October 31, 2022, but outperformed the global equity markets, as defined by the MSCI All Country World Index (ACWI)<sup>1</sup> by 8.62%. The Underlying Index outperformed the MSCI All Country World Index due to the Underlying Index's greater allocation to infrastructure relative to its real estate allocation, as well as its inclusion of natural resources, which had a positive total return for the 12 months. Tracking difference between the Fund's NAV and the Underlying Index's total return for the period was -15 basis points ("bps")<sup>2</sup>, which is largely reflective of the Fund's management fee (-57 bps), a reimbursement amount equal to the Acquired Fund Fees and Expenses attributable to the Fund's investments in the Underlying Funds (+46 bps), stock selection/futures (-3 bps) and performance calculation differences between the Underlying Index and the Fund (-1 bp).

<sup>1</sup> The Morgan Stanley Capital International All Country World Index is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI) and is designed to provide a broad measure of stock performance throughout the world.

<sup>2</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

34 FLEXSHARES ANNUAL REPORT

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| FlexShares<sup>®</sup> | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Index Fund Ticker: QDF

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g66e34.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>12/14/2012** |
|  FlexShares Quality Dividend Index Fund (Based on Net Asset Value) | -8.29% | 6.90% | 7.31% | 10.86% |
|  FlexShares Quality Dividend Index Fund (Based on Market Price) | -8.27% | 6.89% | 7.31% | 10.87% |
|  Russell 1000<sup>®</sup> Index | -16.38% | 9.98% | 10.20% | 12.74% |
|  *Northern Trust Quality Dividend Index<sup>SM</sup>*  | -7.95% | 7.45% | 7.84% | 11.39% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust Quality Dividend Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust 1250 Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk-return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is similar to that of the Parent Index. As of October 31, 2022, there were 127 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by

<sup>1</sup> Northern Trust 1250 Index is a float-adjusted market-capitalization weighted index comprised of U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 35

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| FlexShares<sup>®</sup> | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Index Fund (cont.)

------

**PORTFOLIO ANALYSIS (cont.)** 

Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>3</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Because of the changes in growth expectations and the rising rate environment, U.S. domestic investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the

12 months. Overall, the positive performance derived from the dividend and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance against the Russell 1000<sup>®</sup> Index<sup>6</sup> by 8.43%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -34 basis points ("bps")<sup>7</sup>, which is reflective of the management fee (-37 bps), stock selection/futures (-1 bps), securities lending (+3 bps), and compounding of tracking error over time (+1 bps).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Russell 1000<sup>®</sup> Index refers to a stock market index that represents the 1000 top companies in the United States.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

36 FLEXSHARES ANNUAL REPORT

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| FlexShares<sup>®</sup> Quality | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Dividend Defensive Index Fund Ticker: QDEF

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g22w94.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>12/14/2012** |
|  FlexShares Quality Dividend Defensive Index Fund (Based on Net Asset Value) | -7.53% | 5.86% | 7.51% | 10.78% |
|  FlexShares Quality Dividend Defensive Index Fund (Based on Market Price) | -7.48% | 5.87% | 7.53% | 10.78% |
|  Russell 1000<sup>®</sup> Index | -16.38% | 9.98% | 10.20% | 12.74% |
|  *Northern Trust Quality Dividend Defensive Index<sup>SM</sup>*  | -7.09% | 6.23% | 8.10% | 11.33% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust Quality Dividend Defensive Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust 1250 Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk-return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is lower in relation to that of the Parent Index. As of October 31, 2022, there were 109 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by

<sup>1</sup> Northern Trust 1250 Index is a float-adjusted market-capitalization weighted index comprised of U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 37

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| FlexShares<sup>®</sup> Quality | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Dividend Defensive Index Fund (cont.)

------

**PORTFOLIO ANALYSIS (cont.)** 

Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>3</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Because of the changes in growth expectations and the rising rate environment, U.S. domestic investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived

from the dividend and quality factor exposures along with the low beta factor exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance against the Russell 1000<sup>®</sup> Index<sup>6</sup> by 9.29%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -44 basis points ("bps")<sup>7</sup>, which is reflective of the management fee (-37 bps), stock selection/futures (-10 bps), securities lending (+3 bps), performance calculation differences between the Underlying Index and the Fund (-1 bp), and compounding of tracking error over time (+1 bps).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Russell 1000<sup>®</sup> Index refers to a stock market index that represents the 1000 top companies in the United States.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

38 FLEXSHARES ANNUAL REPORT

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| FlexShares<sup>®</sup> Quality | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Dividend Dynamic Index Fund Ticker: QDYN

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g58i93.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>12/14/2012** |
|  FlexShares Quality Dividend Dynamic Index Fund (Based on Net Asset Value) | -9.23% | 10.00% | 8.86% | 11.52% |
|  FlexShares Quality Dividend Dynamic Index Fund (Based on Market Price) | -9.20% | 10.02% | 8.89% | 11.52% |
|  *Russell 1000<sup>®</sup> Index* | -16.38% | 9.98% | 10.20% | 12.74% |
|  *Northern Trust Quality Dividend Dynamic Index<sup>SM</sup>*  | -8.87% | 10.39% | 9.20% | 11.90% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust Quality Dividend Dynamic Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust 1250 Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is higher in relation to that of the Parent Index. As of October 31, 2022, there were 124 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by

<sup>1</sup> Northern Trust 1250 Index is a float-adjusted market-capitalization weighted index comprised of U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 39

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| FlexShares<sup>®</sup> Quality | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Dividend Dynamic Index Fund (cont.)

------

**PORTFOLIO ANALYSIS (cont.)** 

Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>3</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. Q1 of 2022 also saw a wide variance in sector performance as energy companies had outsized positive performance while the technology and communication services sectors were the worst performers. The selloff of U.S. equities accelerated in Q2 of 2022 as the Fed moved forward with aggressive key interest rate hikes to seek to combat rising inflation. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. Economic data was better than expected, but there were some signals that a slowdown may be coming. U.S. equity markets continued lower in Q3 of 2022 as the Fed continued raising the key interest rate with two 0.75% increases in July and September. Gross Domestic Product data showed year-over-year growth to be negative for Q2 of 2022, marking the second consecutive quarter of negative growth. Domestic equities rebounded in October of 2022 as corporate earnings reported over the month were generally better than expected. Sector performance dispersion was again large as the energy sector continued to outpace the rest of the U.S. equity market.

Because of the changes in growth expectations and the rising rate environment, U.S. domestic investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as higher yielding investments outperformed lower yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Because U.S. equities moved lower over the

12 months, we believe that the high beta exposure detracted from Fund performance. Overall, the positive performance derived from the yield and quality factor exposures of the Underlying Index were enough to offset the negative performance of its high beta exposure leading to the Underlying Index's outperformance against the Russell 1000<sup>®</sup> Index<sup>6</sup> by 7.51%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -36 basis points ("bps")<sup>7</sup>, which is reflective of the management fee (-37 bps), stock selection/futures (-3 bps), securities lending (+3 bps) and compounding of tracking error over time (+1 bp).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Russell 1000 Index refers to a stock market index that represents the 1000 top companies in the United States.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

40 FLEXSHARES ANNUAL REPORT

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|:---|:---|
| FlexShares<sup>®</sup> International | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Index Fund Ticker: IQDF

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g06e41.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>4/12/2013** |
|  FlexShares International Quality Dividend Index Fund (Based on Net Asset Value) | -24.11% | -2.92% | -2.35% | 0.98% |
|  FlexShares International Quality Dividend Index Fund (Based on Market Price) | -24.52% | -2.98% | -2.44% | 0.96% |
|  *MSCI AC World ex USA Index* | -24.73% | -1.68% | -0.60% | 2.39% |
|  *Northern Trust International Quality Dividend Index<sup>SM</sup>*  | -24.06% | -2.66% | -2.20% | 1.30% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is similar to that of the Parent Index. As of October 31, 2022, there were 202 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on international equities generally traded lower. Over the course of the 12-month period the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising USD. Through Q4 of 2021, international equities

<sup>1</sup> Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 41

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| FlexShares<sup>®</sup> International | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

traded lower as the rapid spread of the Omicron variant of Covid-19 stoked fears that a new round of lockdowns in China would hinder growth in the region. International equity markets continued to decline in Q1 of 2022 as Russia launched a full scale invasion into Ukraine and the U.S. and its European allies responded with sanctions. As part of these sanctions, Russian equity securities were removed from major international market indices in March. The selloff in international equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>3</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the USD to strengthen versus many global currencies. International equities generally traded higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes in the near future.

Because of the changes in growth expectations and the rising rate environment, international investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as high yielding investments outperformed low yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the dividend and quality factor exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance against the MSCI ACWI ex USA Index<sup>6</sup> by 0.67%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -5 basis points ("bps")<sup>7</sup>, which is reflective of the Fund's management fee (-47 bps), stock selection/futures

(+32 bps), securities lending (+5 bps), performance calculation differences between the Underlying Index and the Fund (+3 bps), and compounding of tracking error over time (+2 bps).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Morgan Stanley Capital International All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI) and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. 

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

42 FLEXSHARES ANNUAL REPORT

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## Quality Dividend Defensive Index Fund Ticker: IQDE

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g63c48.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>4/12/2013** |
|  FlexShares International Quality Dividend Defensive Index Fund (Based on Net Asset Value) | -22.06% | -2.89% | -2.37% | 0.52% |
|  FlexShares International Quality Dividend Defensive Index Fund (Based on Market Price) | -22.29% | -2.98% | -2.53% | 0.48% |
|  *MSCI AC World ex USA Index* | -24.73% | -1.68% | -0.60% | 2.39% |
|  *Northern Trust International Quality Dividend Defensive Index<sup>SM</sup>*  | -21.86% | -2.57% | -2.13% | 0.98% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend Defensive Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is less than that of the Parent Index. As of October 31, 2022, there were 210 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on international equities generally traded lower. Over the course of the 12-month period the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising dollar. Through Q4 of 2021, international equities

<sup>1</sup> Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 43

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| FlexShares<sup>®</sup> International | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Defensive Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

traded lower as the rapid spread of the Omicron variant of Covid-19 stoked fears that a new round of lockdowns in China would hinder growth in the region. International equity markets continued to decline in Q1 of 2022 as Russia launched a full scale invasion into Ukraine and the U.S. and its European allies responded with sanctions. As part of these sanctions, Russian equity securities were removed from major international market indices in March. The selloff in international equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>3</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the USD to strengthen versus many global currencies. International equities generally traded higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes in the near future.

Because of the changes in growth expectations and the rising rate environment, international investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as high yielding investments outperformed low yielding and non-dividend paying investments, as was the low beta exposure. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Overall, the positive performance derived from the dividend, quality and low beta factor exposures of the Underlying Index were the primary sources of the Underlying Index's outperformance against the MSCI ACWI ex USA Index<sup>6</sup> by 2.87%. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -20 basis points ("bps")<sup>7</sup>, which is reflective of the Fund's management fee (-47 bps), stock selection/futures (+8 bps), securities lending (+6 bps),

performance calculation differences between the Underlying Index and the Fund (+1 bps), India Cap Gain Tax (+7 bps) and compounding of tracking error over time (+5 bps).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Morgan Stanley Capital International All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI) and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. 

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

44 FLEXSHARES ANNUAL REPORT

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## Quality Dividend Dynamic Index Fund Ticker: IQDY

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g73w65.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>4/12/2013** |
|  FlexShares International Quality Dividend Dynamic Index Fund (Based on Net Asset Value) | -25.48% | -1.03% | -0.88% | 2.46% |
|  FlexShares International Quality Dividend Dynamic Index Fund (Based on Market Price) | -26.15% | -1.23% | -1.01% | 2.43% |
|  *MSCI AC World ex USA Index* | -24.73% | -1.68% | -0.60% | 2.39% |
|  *Northern Trust International Quality Dividend Dynamic Index<sup>SM</sup>*  | -25.46% | -0.73% | -0.65% | 2.85% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.48% and the net expense ratio is 0.47%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of the Northern Trust International Quality Dividend Dynamic Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index (the "Parent Index")<sup>1</sup>. In addition, the Underlying Index is designed to select companies from the Parent Index that have enhanced risk return characteristics and that in the aggregate have the potential to generate income in excess of the income generated by securities in the Parent Index with a beta<sup>2</sup> that is higher than that of the Parent Index. As of October 31, 2022, there were 204 issues in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on international equities generally traded lower. Over the course of the 12-month period the U.S. dollar (USD) rose significantly and negatively impacted U.S. investors as returns in international currencies generally were hurt by the rising dollar. Through Q4 of 2021, international equities traded lower as the rapid spread of the Omicron variant of Covid-19 stoked fears that a new round of

<sup>1</sup> Northern Trust International Large Cap Index is a float-adjusted market-capitalization weighted index comprised of non-U.S. domiciled large- and mid-capitalization companies.

<sup>2</sup> A statistical measure of the volatility, or sensitivity, of rates of return on a portfolio or security compared to a market index and time period. The beta for an ETF measures the expected change in return of the ETF relative to the return of a designated index. By definition, the beta of the Standard & Poor's ("S&P") 500 Index is 1.00. Accordingly, a fund with a 1.10 beta is expected to perform 10% better than the S&P 500 Index in rising markets and 10% worse in falling markets. 

FLEXSHARES ANNUAL REPORT 45

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| FlexShares<sup>®</sup> International | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Quality Dividend Dynamic Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

lockdowns in China would hinder growth in the region. International equity markets continued to decline in Q1 of 2022 as Russia launched a full scale invasion into Ukraine and the U.S. and its European allies responded with sanctions. As part of these sanctions, Russian equity securities were removed from major international market indices in March. The selloff in international equities accelerated in Q2 and Q3 of 2022 as the continued war in Ukraine, rising inflation, energy shortages and tightening monetary policy increased the risk of a global recession. As global central banks struggled to keep pace with the aggressive key interest rate<sup>3</sup> hikes by the U.S. Federal Reserve, the increasing interest rate differential caused the USD to strengthen versus many global currencies. International equities generally traded higher in October of 2022 as corporate earnings showed resilience and investors interpreted statements by the European Central Bank regarding the likelihood of a recession as a potential reprieve to further key interest rate hikes in the near future.

Because of the changes in growth expectations and the rising rate environment, international investments trended downward during the 12 months ended October 31, 2022 and we believe the dividend yield factor<sup>4</sup> was a positive driver of Fund performance as high yielding investments outperformed low yielding and non-dividend paying investments. In addition, we believe that the changes experienced in the macroeconomic environment as well as the increase in interest rates were conducive to high quality factor<sup>5</sup> companies, resulting in the high-quality factor exposure augmenting Fund performance over the 12 months. Because international equities moved lower over the 12 months we believe that the high beta exposure detracted from Fund performance. Overall, the positive performance derived from the yield and quality factor exposures of the Underlying Index were not enough to offset the negative performance of its high beta exposure leading to the Underlying Index's underperformance against the MSCI ACWI ex USA Index<sup>6</sup> by 0.73%. Tracking difference between the Fund's NAV and the Underlying Index's total return

for the 12-month period was -2 basis points ("bps")<sup>7</sup>, which is reflective of the Fund's management fee (-47 bps), stock selection/futures (+2 bps), securities lending (+8 bps), dividend tax differential (-1 bps), performance calculation differences between the Underlying Index and the Fund (+27 bps), India Cap Gain Tax (+7 bps) and compounding of tracking error over time (+2 bps).

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> Dividend yield factor is a factor that seeks to identify companies that realize a dividend yield above the Parent Index.

<sup>5</sup> The quality factor is a factor that seeks to identify companies that exhibit stable returns relative to the market.

<sup>6</sup> The Morgan Stanley Capital International All Country World Index Ex-U.S. is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI) and is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. 

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

46 FLEXSHARES ANNUAL REPORT

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## 3-Year Target Duration TIPS Index Fund Ticker: TDTT

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g89t98.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **1 Year** |  | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/19/2011** |
|  FlexShares iBoxx 3-Year Target Duration TIPS |  |  |  |  |  |
|  Index Fund (Based on Net Asset Value) | -4.41 | %\* | 2.55% | 1.26% | 1.38% |
|  FlexShares iBoxx 3-Year Target Duration TIPS |  |  |  |  |  |
|  Index Fund (Based on Market Price) | -4.36 | % | 2.57% | 1.27% | 1.39% |
|  iBoxx 3-Year Target Duration TIPS Index | -4.19 | % | 2.73% | 1.44% | 1.55% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the iBoxx 3-Year Target Duration TIPS Index (the "Underlying Index"). The Underlying Index reflects the performance of a selection of inflation protected public obligations of the U.S. Treasury ("TIPS"), with a targeted average modified adjusted duration,<sup>1</sup> as defined by IHS Markit as the index provider, of approximately three years. The Underlying Index includes publicly issued TIPS that have maturity dates of at least one year but not more than ten years from an index rebalancing date. As of October 31, 2022, there were 18 TIPS in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to achieve the Fund's investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. "Representative sampling" means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>2</sup> by 0.25% in March 2022

<sup>1</sup> The duration calculated from the real modified duration of a TIPS security, adjusted for the market's estimated beta for a TIPS security versus a nominal Treasury security due to the actual and expected changes in inflation.

<sup>2</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

FLEXSHARES ANNUAL REPORT 47

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## 3-Year Target Duration TIPS Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>3</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities.

Intermediate-term<sup>4</sup> credit spreads<sup>5</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>6</sup> to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year<sup>8</sup>.

TIPS inflation breakeven<sup>9</sup> spreads in the 10-year maturity and shorter moved lower during the fiscal

year as investors weighed the impact of Fed actions and geopolitical events on future inflation potential. We believe that inflationary pressures from supply constraints and wage pressures were being offset by demand destruction, often from the impact of higher energy costs. Inflation expectations remain elevated versus recent history and against Fed policy levels. By the end of the fiscal year, TIPS breakeven spreads were: 1-year -50 bps, 5-year -27 bps, 10-year -8 bps and 30-year +23 bps.

The highest U.S. inflation rate in 30 years along with rising real interest rates during the fiscal year led to a negative total return performance for both the Fund and the Underlying Index. For the 12-month period, the NAV performance of the Fund outperformed the Bloomberg U.S. TIPS 1-10 Year Index<sup>10</sup> by +278 bps due in part to lower overall duration in the 1–3-year section of the TIPS yield curve with rising real interest rates. Tracking difference between the Fund's NAV and the Underlying Index for the 12-month period was -22 bps, reflective of the Fund's management fee (-18 bps), duration and curve positioning (+4 bps), security selection (-2 bps) and other factors (-6 bps).

The iBoxx 3-Year Target Duration TIPS Index is the intellectual property (including registered trademarks) of Markit iBoxx and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Markit iBoxx and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>3</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>4</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>5</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>6</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>9</sup> Bloomberg. In this analysis we are making a comparison between the difference in the nominal yield and real yield rates of the 1-year, 5-year, 10-year and 30-year maturities using data available as of October 31, 2021 and October 31, 2022.

<sup>10</sup> The Bloomberg US Treasury Inflation Notes: 1-10 Year \Index (Series-L) measures the performance of the US Treasury Inflation Protected Securities (TIPS) market with less than 10 years to maturity.

48 FLEXSHARES ANNUAL REPORT

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| FlexShares<sup>®</sup> iBoxx<sup>®</sup> | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## 5-Year Target Duration TIPS Index Fund Ticker: TDTF

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g45b36.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **1 Year** |  | **5 Year** | **10 Year** | **Fund<br>Inception<br>9/19/2011** |
|  FlexShares iBoxx 5-Year Target Duration TIPS |  |  |  |  |  |
|  Index Fund (Based on Net Asset Value) | -9.42 | %\* | 2.32% | 1.16% | 1.60% |
|  *FlexShares iBoxx 5-Year Target Duration TIPS* |  |  |  |  |  |
|  *Index Fund (Based on Market Price)* | -9.44 | % | 2.33% | 1.15% | 1.61% |
|  *iBoxx 5-Year Target Duration TIPS Index* | -9.25 | % | 2.52% | 1.33% | 1.76% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.19% and the net expense ratio is 0.18%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the iBoxx 5-Year Target Duration TIPS Index (the "Underlying Index"). The Underlying Index reflects the performance of a selection of inflation protected public obligations of the U.S. Treasury ("TIPS"), with a targeted average modified adjusted duration,<sup>1</sup> as defined by IHS Markit as the index provider, of approximately five years. The Underlying Index includes publicly issued TIPS that have maturity dates of at least three years but not more than twenty years from an index rebalancing date. As of October 31, 2022, there were 26 TIPS in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to achieve the Fund's investment objective. NTI generally intends to replicate the constituent securities of the Underlying Index to manage the Fund but may use representative sampling in certain circumstances. "Representative sampling" means investing in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. When the Fund uses representative sampling, it may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the

<sup>1</sup> The duration calculated from the real modified duration of a TIPS security, adjusted for the market's estimated beta for a TIPS security versus a nominal Treasury security due to the actual and expected changes in inflation.

FLEXSHARES ANNUAL REPORT 49

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| FlexShares<sup>®</sup> iBoxx<sup>®</sup> | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## 5-Year Target Duration TIPS Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

key interest rate<sup>2</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened— which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>3</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>4</sup> credit spreads<sup>5</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>6</sup> to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year<sup>8</sup>.

TIPS inflation breakeven<sup>9</sup> spreads in the 10-year maturity and shorter moved lower during the fiscal year as investors weighed the impact of Fed actions and geopolitical events on future inflation potential. We believe that inflationary pressures from supply constraints and wage pressures were being offset by demand destruction, often from the impact of higher energy costs. Inflation expectations remain elevated versus recent history and against Fed policy levels. By the end of the fiscal year, TIPS breakeven spreads were: 1-year -50 bps, 5-year -27 bps, 10-year -8 bps and 30-year +23 bps.

The highest U.S. inflation rate in 30 years along with rising real interest rates during the fiscal year led to positive total return performance for both the Fund and the Underlying Index. For the 12-month period, the NAV performance of the Fund underperformed the Bloomberg U.S. TIPS 1-10 Year Index<sup>10</sup> by -30 bps due to higher duration positioning of the Underlying Index against the backdrop of falling real interest rates. Tracking difference between the Fund's NAV and the Underlying Index for the 12-month period was -17 bps, reflective of the Fund's management fee (-18 bps), duration and curve positioning (-4 bps), security selection (+3 bps), trading and pricing differences (+8 bps), and other factors (-6 bps).

The iBoxx 5-Year Target Duration TIPS Index is the intellectual property (including registered trademarks) of Markit iBoxx and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by Markit iBoxx and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>2</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>3</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>4</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>5</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>6</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>9</sup> Bloomberg. In this analysis we are making a comparison between the difference in the nominal yield and real yield rates of the 1-year, 5-year, 10-year and 30-year maturities using data available as of October 31, 2021 and October 31, 2022.

<sup>10</sup> The Bloomberg US Treasury Inflation Notes: 1-10 Year \Index (Series-L) measures the performance of the US Treasury Inflation Protected Securities (TIPS) market with less than 10 years to maturity.

50 FLEXSHARES ANNUAL REPORT

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## Duration MBS Index Fund Ticker: MBSD

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g28o21.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>9/3/2014** |
|  FlexShares Disciplined Duration MBS Index Fund (Based on Net Asset Value) | -12.16% | -2.69% | -0.55% | 0.27% |
|  FlexShares Disciplined Duration MBS Index Fund (Based on Market Price) | -12.40% | -2.72% | -0.55% | 0.26% |
|  *ICE BofA Merrill Lynch<sup>®</sup> Constrained Duration US Mortgage Backed Securities Index<sup>SM</sup>*  | -11.57% | -2.23% | -0.01% | 0.75% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.21% and the net expense ratio is 0.20%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the ICE BofA<sup>®</sup> Constrained Duration US Mortgage Backed Securities Index (the "Underlying Index"). The Underlying Index reflects the performance of a selection of investment-grade US agency residential mortgage-backed pass-through securities ("MBS"). Pursuant to the Underlying Index's methodology, index constituents are adjusted to achieve an effective duration<sup>1</sup> that is generally between 3.25 and 4.25 years. As of October 31, 2022, there were 129 securities in the Underlying Index. Northern Trust Investments, Inc. ("NTI") uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>2</sup> by 0.25% in March 2022

FLEXSHARES ANNUAL REPORT 51

<sup>1</sup> Effective duration provides a measure of a fund's interest-rate sensitivity and the longer a fund's duration, the more sensitive the fund is to shifts in interest rates. Duration also gives an indication of how a fund's NAV will change as interest rates change. A fund with a five-year duration would be expected to lose 5% of its NAV if interest rates rose by 1 percentage point or gain 5%, if interest rates fell by 1 percentage point. Morningstar surveys fund companies for this information. 

<sup>2</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

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## Duration MBS Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>3</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities.

Intermediate-term<sup>4</sup> credit spreads<sup>5</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>6</sup> to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year<sup>8</sup>.

Rising interest rates eventually drove down housing sales and mortgage applications as average 30-year mortgage rates (Freddie Mac Index) rose dramatically from 3.22% to 7.08% during the fiscal year<sup>9</sup>. Existing home sales saw a 32% decrease<sup>10</sup> while new housing starts saw an decrease of over 9% for the fiscal year.<sup>11</sup>

Highest inflation in 30 years along with falling real interest rates during the fiscal year led to positive total return performance for both the Fund and the Underlying Index. For the 12-month period, the NAV performance of the Fund outperformed the Bloomberg U.S. Mortgage Backed Securities Index<sup>12</sup> by +30 bps due to the Underlying Index's exposure to a selection of higher coupon<sup>13</sup>, more seasoned MBS securities which outperformed newer MBS due in part to less principal prepayment risk. Tracking difference between the Fund's NAV and the Underlying Index's total return for the 12-month period was -101 bps, reflective of the Fund's management fee (-20 bps), trading costs and fees (-8 bps), pricing differences (-83 bps), yield curve positioning (-21 bps), sector allocation (-5 bps), security selection (+37 bps), and other factors (-1 bps).

The ICE BofAML Constrained Duration US Mortgage Backed Securities Index is the intellectual property (including registered trademarks) of ICE BofAML and/or its licensors ("Licensors"), which is used under license. The securities based on the Index are in no way sponsored, endorsed, sold or promoted by ICE BofAML and its Licensors and neither of the Licensors shall have any liability with respect thereto.

<sup>3</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>4</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>5</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>6</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>9</sup> Source: Bloomberg. Federal Home Loan Mortgage Corp. Primary Mortgage Market Survey. October 31, 2021 through November 1, 2022.

<sup>10</sup> Source: Bloomberg. National Association of Realtors, US Existing Homes Sales, September 30, 2021 through September 30, 2022.

<sup>11</sup> Source: Bloomberg. U.S. Census Bureau, Us New Privately Owned Housing Unites Starts, October 31, 2021 through October 31, 2022.

<sup>12</sup> The Bloomberg US Mortgage Backed Securities Index tracks fixed-rate agency mortgage backed passthrough securities guaranteed by Ginnie Mae (GNMA), Fannie Mae (FNMA), and Freddie Mac (FHLMC).

<sup>13</sup> A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. 

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## US Corporate Bond Index Fund Ticker: SKOR

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g52b52.jpg)

\* The hybrid index performance information reflects the performance of the Northern Trust Credit-Scored US Corporate Bond Index<sup>SM</sup> (Previous Index) through April 30, 2020 and the Northern Trust US Corporate Bond Quality Value Index<sup>SM</sup> thereafter. The Previous Index terminated as of May 1, 2020. 

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** |  | **5 Year** |  | **Fund<br>Inception<br>11/12/2014** |  |
|  FlexShares Credit-Scored US Corporate Bond Index Fund (Based on Net Asset Value) | -12.91% | -2.03 | % | 0.56 | % | 1.50 | % |
|  FlexShares Credit-Scored US Corporate Bond Index Fund (Based on Market Price) | -12.79% | -1.99 | % | 0.53 | % | 1.51 | % |
|  *Bloomberg Intermediate U.S. Corporate Index* | -12.18% | -2.08 | % | 0.52 | % | 1.49 | % |
|  *Northern Trust US Corporate Bond Quality Value Index<sup>SM</sup>* | -12.37% | -1.43 | %\* | 1.09 | %\* | 1.95 | %\* |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust US Corporate Bond Quality Value Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index reflects the performance of a broad universe of intermediate maturity, US-dollar denominated investment grade corporate bonds that can potentially deliver a higher total return than the overall investment grade corporate bond market, as represented by the Northern Trust US Investment-Grade Corporate Bond Index<sup>SM</sup> (the "Parent Index").<sup>1</sup> The Underlying Index begins with the Parent Index and then follows a rules-based methodology to select and weight securities, subject to certain constraints, to optimize the Underlying Index's exposure to a combined proprietary, value score<sup>2</sup> and a proprietary quality score<sup>3</sup>, as determined by Northern Trust Investments, Inc. ("NTI"), in its capacity as index provider. Utilizing the value and quality scores, the Underlying Index methodology seeks to identify bonds that are trading at market prices that are lower relative to levels implied by their fundamentals, thus creating a potential opportunity for capital appreciation and higher income compared to the broader investment grade corporate bond market. As of October 31, 2022, there were 2,357 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment

<sup>1</sup> The Northern Trust US Investment Grade Corporate Bond Index<sup>SM</sup> is a market-capitalization weighted index comprised of U.S. dollar-denominated investment grade corporate bonds.

<sup>2</sup> The value score is a quantitative measure of the relative attractiveness of each security's valuation compared to market price or relative valuation versus other similar securities, and is computed based on market and fundamental measures, including issuer default risk.

<sup>3</sup> The quality score is a quantitative ranking based on: (a) an assessment of management efficiency (e.g., corporate finance activities); (b) profitability (reliability and sustainability of financial performance); and (c) financial solvency (e.g., debt servicing capacity).

FLEXSHARES ANNUAL REPORT 53

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## US Corporate Bond Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>4</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>5</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>6</sup> credit spreads<sup>7</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>8</sup> to 63 basis points ("bps")<sup>9</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.<sup>10</sup>

During the fiscal year, the Fund's NAV underperformed the Bloomberg U.S. Intermediate Corporate Bond Index<sup>11</sup> by -5 bps due in part to the Fund's management fee. During the fiscal year, relative overweight allocations to fixed income securities in financials, real estate investment trusts ("REIT") and utilities sectors along with security selection in the banking and utility sectors added to Fund performance while a relative underweighting to the communications sector and security selection in the industrials sector detracted from performance. The tracking difference between the Fund's NAV and the Underlying Index's return for the fiscal year was -64 bps, which is reflective of the Fund's management fee (-22 bps), trading costs and fees (-14 bps), pricing differences (+1 bps), sector and security selection (-31 bps), yield curve positioning (+1 bps), and other factors (+1 bp).

<sup>4</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>5</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>6</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>7</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>8</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>9</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>10</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>11</sup> Bloomberg US Intermediate Corporate Bond Index measures the investment grade, fixed-rate, taxable corporate bond market that have between 1 and up to, but not including, 10 years to maturity.

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| FlexShares<sup>®</sup> Credit-Scored | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## US Long Corporate Bond Index Fund Ticker: LKOR

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g37i97.jpg)

\* The hybrid index performance information reflects the performance of the Northern Trust Credit-Scored US Long Corporate Bond IndexSM (Previous Index) through April 30, 2020 and the Northern Trust US Long Corporate Bond Quality Value Index<sup>SM</sup> thereafter. The Previous Index terminated as of May 1, 2020. 

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** |  | **5 Year** |  | **Fund<br>Inception<br>9/23/2015** |  |
|  FlexShares Credit-Scored US Long Corp Bond Index Fund (Based on Net Asset Value) | -31.58% | -7.41 | % | -1.56 | % | 1.29 | % |
|  FlexShares Credit-Scored US Long Corp Bond Index Fund (Based on Market Price) | -31.22% | -7.16 | % | -1.54 | % | 1.36 | % |
|  *Bloomberg Long U.S. Corporate Index* | -31.04% | -7.83 | % | -1.75 | % | 1.30 | % |
|  *Northern Trust US Long Corporate Bond Quality Value Index<sup>SM</sup>* | -31.16% | -6.59 | %\* | --0.84 | %\* | 1.95 | %\* |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.23% and the net expense ratio is 0.22%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust US Long Corporate Bond Quality Value Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index reflects the performance of a broad universe of longer term maturity, US-dollar denominated investment grade corporate bonds that can potentially deliver a higher total return than the overall investment grade corporate bond market, as represented by the Northern Trust US Long Corporate Bond Index<sup>SM</sup><u> </u>(the "Parent Index").<sup>1</sup> The Underlying Index begins with the Parent Index and then follows a rules-based methodology to select and weight securities, subject to certain constraints, to optimize the Underlying Index's exposure to a combined proprietary, value score<sup>2</sup> and a proprietary quality score<sup>3</sup>, as determined by Northern Trust Investments, Inc. ("NTI"), in its capacity as index provider. Utilizing the value and quality scores, the Underlying Index methodology seeks to identify bonds that are trading at market prices that are lower relative to levels implied by their fundamentals, thus creating a potential opportunity for capital appreciation and higher income compared to the broader investment grade corporate bond market. As of October 31, 2022, there were 1,273 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that

<sup>1</sup> The Northern Trust US Long Corporate Bond Index<sup>SM</sup> is a market capitalization weighted index comprised of long-term, U.S. dollar- denominated investment grade corporate bonds.

<sup>2</sup> The value score is a quantitative measure of the relative attractiveness of each security's valuation compared to market price or relative valuation versus other similar securities, and is computed based on market and fundamental measures, including issuer default risk.

<sup>3</sup> The quality score is a quantitative ranking based on: (a) an assessment of management efficiency (e.g., corporate finance activities); (b) profitability (reliability and sustainability of financial performance); and (c) financial solvency (e.g., debt servicing capacity).

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| FlexShares<sup>®</sup> Credit-Scored | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## US Long Corporate Bond Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>4</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>5</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>6</sup> credit spreads<sup>7</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>8</sup> to 63 basis points ("bps")<sup>9</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.<sup>10</sup>

During the fiscal year, the Fund's NAV underperformed the Bloomberg U.S. Long Corporate Bond Index<sup>11</sup> by +59 bps. During the fiscal year, positive performance from relative sector overweight allocations to fixed income securities in energy, financials and materials sectors added to Fund performance while a relative underweighting to the communications, consumer staples and industrial sectors detracted from performance. The tracking difference between the Fund's NAV and the combined Underlying Indexes return for the period was -72 bps, which is reflective of the Fund's management fee (-22 bps), trading costs and fees (-36 bps), pricing differences (-5 bps), sector and security selection (-17 bps), yield curve positioning (+9 bps), and other factors (-1 bp).

<sup>4</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>5</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>6</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>7</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>8</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>9</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>10</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>11</sup> Bloomberg US Long Corporate Bond Index measures the performance of investment grade U.S. corporate bond market with bonds that have a maturity of more than ten years.

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| FlexShares<sup>®</sup> High Yield | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Value-Scored Bond Index Fund Ticker: HYGV

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g02a02.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | |
|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **Fund<br>Inception<br>7/17/2018** |
|  FlexShares High Yield Value-Scored US Bond Index Fund (Based on Net Asset Value) | -13.06% | 0.53% | 2.10% |
|  FlexShares High Yield Value-Scored US Bond Index Fund (Based on Market Price) | -12.98% | 0.52% | 2.13% |
|  *ICE BofA<sup>®</sup> US High Yield Index* | -11.45% | 0.18% | 2.06% |
|  *Northern Trust High Yield Value-Scored US Corporate Bond Index<sup>SM</sup>*  | -11.93% | 2.10% | 3.42% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.38% and the net expense ratio is 0.37%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust High Yield Value-Scored US Corporate Bond Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index reflects the performance of a broad universe of US-dollar denominated high yield corporate bonds that seeks a higher total return than the overall high yield corporate bond market, as represented by the Northern Trust High Yield US Corporate Bond Index<sup>SM</sup> (the "Parent Index").<sup>1</sup> The securities included in the Underlying Index are a subset of the securities included in the Parent Index. The Underlying Index begins with the Parent Index and then follows a rules-based methodology to select and weight securities, subject to certain constraints, to optimize exposure to a proprietary value score<sup>2</sup>, as determined by Northern Trust Investments, Inc. ("NTI"), acting in its capacity as index provider. Utilizing the value score, the Underlying Index seeks to select bonds that are trading at market prices which are lower relative to levels implied by their fundamentals, thus creating an opportunity for potential capital appreciation and higher income to the broader market reflected by the Parent Index. As of October 31, 2022, there were 989 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

<sup>1</sup> The Northern Trust High Yield US Corporate Bond Index<sup>SM</sup> is a market capitalization weighted index comprised of U.S. dollar- denominated high yield corporate bonds.

<sup>2</sup> The value score is a quantitative measure of the relative attractiveness of each security's valuation compared to market price or relative valuation versus other similar securities, and is computed based on market and fundamental measures, including issuer default risk.

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| FlexShares<sup>®</sup> High Yield | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Value-Scored Bond Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>3</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>4</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term,

those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities.

Intermediate-term<sup>5</sup> credit spreads<sup>6</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS) to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.

High Yield credit spreads from the beginning of the fiscal year raised investors' uncertainty for corporate revenues and earnings. High Yield<sup>8</sup> option adjusted spreads ("OAS")<sup>9</sup> of the ICE BofA US High Yield Index<sup>10</sup> declined from 532 bps to 302 bps in early July 2022, then widened to 321 bps at the end of August 2022 and ended the fiscal year at 315 bps.<sup>11</sup> We believe the decline in credit spreads was linked to investors continuing search for income, robust economic growth supported by fiscal and monetary policy and lower credit defaults. The Moody's Investor Services' annual high yield default rate measure fell from 8.3% in October 2021 to 2.6% as of October 2022.<sup>12</sup> Our analysis, based on increasing issuance of new supply, suggests that High Yield investments have benefitted from the post-COVID recovery and access to capital markets as the year-to-date through October 2022 total gross new issuance of U.S. high yield bonds totaled $462 billion, versus the then record of $450 billion issued in 2020 and the $399 billion issued in 2013.<sup>13</sup>

<sup>3</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>4</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>5</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>6</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> High yield are fixed income securities that are rated in the middle rating of Moody's, Fitch and S&P is Ba1/BB+/BB+ or below.

<sup>9</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>10</sup> The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as "junk") corporate debt publicly issued in the U.S. domestic market.

<sup>11</sup> Source: Bloomberg. In this analysis we are making a comparison between the difference of the Option Adjusted Spread of long-term High Yield corporate bonds using data available on the ICE BofA US High Yield Index as of October 31, 2021 – October 31, 2022.

<sup>12</sup> Source: Moodys Investor Services, High Yield Default Recovery Analytics, October 31, 2022.

<sup>13</sup> Source: JP Morgan, 2022 High Yield Bond and Leverage Loan Supply Outlook, October 31, 2022.

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| FlexShares<sup>®</sup> High Yield | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## Value-Scored Bond Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

During the fiscal year, the Fund's NAV underperformed the ICE BofA US High Yield Index by -161 bps. During the fiscal year, positive performance from relative sector overweight allocations to fixed income securities in energy, financials and materials sectors added to Fund performance while a relative underweighting to the communications, consumer staples and industrial sectors detracted from performance. The tracking difference between the Fund's NAV and the combined Underlying Indexes return for the period was -72 bps, which is reflective of the Fund's management fee (-22 bps), trading costs and fees (-36 bps), pricing differences (-5 bps), sector and security selection (-17 bps), yield curve positioning (+9 bps), and other factors (-1 bp).

FLEXSHARES ANNUAL REPORT 59

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| FlexShares<sup>®</sup> ESG & Climate | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## High Yield Corporate Core Index Fund Ticker: FEHY

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g00s01.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | |
|:---|:---|:---|
|  | **1 Year** | **Fund<br>Inception<br>9/20/2021** |
|  FlexShares ESG & Climate High Yield Corporate Core Index Fund (Based on Net Asset Value) | -12.47% | -11.69% |
|  FlexShares ESG & Climate High Yield Corporate Core Index Fund (Based on Market Price) | -12.52% | -11.72% |
|  *ICE BofA<sup>®</sup> US High Yield Index* | -11.45% | -10.59% |
|  *Northern Trust ESG & Climate High Yield U.S. Corporate Core Index* | -11.65% | -10.85% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2022. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.24% and the net expense ratio is 0.23%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate High Yield U.S. Corporate Core Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index seeks to reflect the performance of a selection of U.S.-dollar-denominated high-yield corporate bonds issued by companies that exhibit certain environmental, social and governance ("ESG") characteristics, while also seeking to provide broad-market, core exposure to U.S.-dollar-denominated high-yield corporate bonds (sometimes referred to as "junk bonds") of U.S. and non-U.S. issuers. The Underlying Index is designed to minimize tracking differences relative to the performance of the Northern Trust High Yield US Corporate Bond Index<sup>SM</sup> (the "Parent Index") while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score ("ESG Vector Score"), and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2022, there were 1,119 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the

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| FlexShares<sup>®</sup> ESG & Climate | **MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE** |

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## High Yield Corporate Core Index Fund (cont.)

------

**PORTFOLIO ANALYSIS (cont.)** 

key interest rate<sup>1</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>2</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities.

Intermediate-term<sup>3</sup> credit spreads<sup>4</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS) to

63 basis points ("bps")<sup>5</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.

High Yield credit spreads from the beginning of the fiscal year raised investors' uncertainty for corporate revenues and earnings. High Yield<sup>6</sup> option adjusted spreads ("OAS")<sup>7</sup> of the ICE BofA US High Yield Index<sup>8</sup> declined from 532 bps to 302 bps in early July 2022, then widened to 321 bps at the end of August 2022 and ended the fiscal year at 315 bps.<sup>9</sup> We believe the decline in credit spreads was linked to investors continuing search for income, robust economic growth supported by fiscal and monetary policy and lower credit defaults. The Moody's Investor Services' annual high yield default rate measure fell from 8.3% in October 2021 to 2.6% as of October 2022.<sup>10</sup> Our analysis, based on increasing issuance of new supply, suggests that High Yield investments have benefitted from the post-COVID recovery and access to capital markets as the year-to-date through October 2022 total gross new issuance of U.S. high yield bonds totaled $462 billion, versus the then record of $450 billion issued in 2020 and the $399 billion issued in 2013.<sup>11</sup>

During the fiscal year, the Fund's NAV underperformed the ICE BofA US High Yield Index by -102 bps. During the fiscal year, negative relative performance from allocation and security selection in health care along with security selection in real estate and sector allocations in industrial and energy offset positive contributions from security selection in energy and communications sectors. The tracking difference between the Fund's NAV and the Underlying Index's return for the period was -82 bps, which is reflective of

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>3</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>4</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>5</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>6</sup> High yield are fixed income securities that are rated in the middle rating of Moody's, Fitch and S&P is Ba1/BB+/BB+ or below.

<sup>7</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>8</sup> The ICE BofA US High Yield Index is market capitalization weighted and is designed to measure the performance of U.S. dollar denominated below investment grade (commonly referred to as "junk") corporate debt publicly issued in the U.S. domestic market.

<sup>9</sup> Source: Bloomberg. In this analysis we are making a comparison between the difference of the Option Adjusted Spread of long-term High Yield corporate bonds using data available on the ICE BofA US High Yield Index as of October 31, 2021 – October 31, 2022.

<sup>10</sup> Source: Moodys Investor Services, High Yield Default Recovery Analytics, October 31, 2022.

<sup>11</sup> Source: JP Morgan, 2022 High Yield Bond and Leverage Loan Supply Outlook, October 31, 2022.

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## High Yield Corporate Core Index Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

the Fund's management fee (-23 bps), trading costs and fees (-3 bps), pricing differences (-30 bps), sector and security selection (-36 bps), yield curve positioning (+4 bps) and other factors (+6 bp).

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## Investment Grade Corporate Core Index Fund Ticker: FEIG

------

**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g00s02.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | |
|:---|:---|:---|
|  | **1 Year** | **Fund<br>Inception<br>9/20/2021** |
|  FlexShares ESG & Climate Investment Grade Corporate Core Index Fund (Based on Net Asset Value) | -19.73% | -18.90% |
|  FlexShares ESG & Climate Investment Grade Corporate Core Index Fund (Based on Market Price) | -19.60% | -18.77% |
|  *Bloomberg US Corporate Total Return Value Unhedged Index* | -19.57% | -18.70% |
|  *Northern Trust ESG & Climate Investment Grade U.S. Corporate Core Index* | -19.54% | -18.70% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2022. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.13% and the net expense ratio is 0.12%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust ESG & Climate Investment Grade U.S. Corporate Core Index<sup>SM</sup> (the "Underlying Index"). The Underlying Index seeks to reflect the performance of a selection of U.S.-dollar-denominated corporate bonds issued by companies that exhibit certain environmental, social and governance ("ESG") characteristics, while also seeking to provide broad-market, core exposure to U.S.-dollar-denominated investment grade corporate bonds of U.S. and non-U.S. issuers. The Underlying Index is designed to minimize tracking differences relative to the performance of the Northern Trust US Corporate Bond Index<sup>SM</sup> (the "Parent Index") while also seeking (a) an aggregate higher scoring of certain ESG characteristics, as measured by the Northern Trust ESG Vector Score ("ESG Vector Score"), and (b) reduction of aggregate climate-related risk, as measured by certain carbon-related risk metrics, each relative to the Parent Index. As of October 31, 2022, there were 3,474 issues in the Underlying Index. NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. NTI uses a representative sampling strategy to manage the Fund. This means that the Fund invests in a representative sample of securities that collectively has an investment profile similar to the Underlying Index. The Fund may or may not hold all of the securities that are included in the Underlying Index.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the

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## Investment Grade Corporate Core Index Fund (cont.)

------

**PORTFOLIO ANALYSIS (cont.)** 

key interest rate<sup>1</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>2</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>3</sup> credit spreads<sup>4</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>5</sup> to 63 basis points ("bps")<sup>6</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.<sup>7</sup>

During the fiscal year, the Fund's NAV underperformed the Bloomberg U.S. Corporate Bond Index<sup>8</sup> by -16 bps. During the fiscal year, security selection in the technology sector detracted slightly from performance while security selection in consumers staples aided performance. The tracking difference between the Fund's NAV and the Underlying Index's return for the fiscal year was -19 bps, which is reflective of the Fund's management fee (-12 bps), trading costs and fees (+4 bps), pricing differences (-10 bps), sector and security selection (+18 bps), yield curve positioning (-14 bps) and other factors (-5 bps).

<sup>1</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>2</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>3</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>4</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>5</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>6</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>7</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>8</sup> Bloomberg US Long Corporate Bond Index measures the performance of investment grade U.S. corporate bond market with bonds that have a maturity of more than ten years.

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## Ready Access Variable Income Fund Ticker: RAVI

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g55r74.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **5 Year** | **10 Year** | **Fund<br>Inception<br>10/9/2012** |
|  FlexShares Ready Access Variable Income Fund (Based on Net Asset Value) | -0.94% | 1.31% | 1.10% | 1.09% |
|  FlexShares Ready Access Variable Income Fund (Based on Market Price) | -1.00% | 1.31% | 1.50% | 1.09% |
|  *Bloomberg Barclays 1-3 Month U.S. Treasury Bill Index* | 0.86% | 1.13% | 0.66% | 0.66% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.26% and the net expense ratio is 0.25%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks maximum current income consistent with the preservation of capital and liquidity. The Fund seeks to achieve its investment objective by investing under normal circumstances at least 80% of its total assets in a non-diversified portfolio of fixed-income instruments, including bonds, debt securities and other similar instruments issued by U.S. and non-U.S. public and private sector entities. Such issuers include, without limitation, U.S. and non-U.S. governments and their agencies, instrumentalities or sponsored enterprises, U.S. state and local governments and municipalities, and U.S. and non-U.S. private-sector entities, such as corporations and banks. The average effective duration<sup>1</sup>, of the Fund will vary based on The Northern Trust Company Investment Policy Committee's forecast for interest rates and will normally not exceed one year. The dollar-weighted average portfolio maturity of the Fund is normally not expected to exceed two years.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the

<sup>1</sup> Average effective duration provides a measure of a fund's interest-rate sensitivity and the longer a fund's duration, the more sensitive the fund is to shifts in interest rates. Duration also gives an indication of how a fund's NAV will change as interest rates change. A fund with a five- year duration would be expected to lose 5% of its NAV if interest rates rose by 1 percentage point, or gain 5%, if interest rates fell by 1 percentage point. Morningstar surveys fund companies for this information. 

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## Ready Access Variable Income Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

key interest rate<sup>2</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>3</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>4</sup> credit spreads<sup>5</sup> trended lower into the fiscal year.

Further robust economic recovery and consumer/business spending helped drive average Intermediate-term option adjusted spreads (OAS)<sup>6</sup> to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing

Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.<sup>8</sup>

For the 12 months ended October 31, 2022, the fund underperformed the generic Treasury Bill index, as defined by the Bloomberg 1-3 Month U.S. Treasury Bill Index<sup>9</sup>, by -180 bps. The Fund's exposure to corporate credit, asset-backed securities and longer duration all negatively impacted performance versus the benchmark index.

<sup>2</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>3</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>4</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>5</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>6</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>9</sup> The Bloomberg 1-3 Month U.S. Treasury Bill Index is designed to measure the performance of public obligations of the U.S. Treasury that have a remaining maturity of greater than or equal to 1 month and less than 3 months.

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## Core Select Bond Fund Ticker: BNDC

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**CUMULATIVE PERFORMANCE** 

**Through October 31, 2022**![LOGO](g402077g08a33.jpg)

**AVERAGE ANNUAL TOTAL RETURN** 

**For the period ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Year** | **5 Year** | **Fund<br>Inception<br>11/18/2016** |
|  FlexShares Core Select Bond Fund (Based on Net Asset Value) | -16.27% | -3.61% | -0.60% | -0.03% |
|  FlexShares Core Select Bond Fund (Based on Market Price) | -16.33% | -3.66% | -0.66% | -0.03% |
|  *Bloomberg U.S. Aggregate Bond Index* | -15.68% | -3.77% | -0.54% | 0.09% |

---

*All data as of 10/31/22. Total returns based on market price do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, these returns would be lower. Total returns based on market price and net asset value ("NAV") assume that dividends and capital gain distributions have been reinvested in the Fund at market price and NAV, respectively. NAV is calculated by dividing the total value of all the securities in the Fund's portfolio plus cash, interest and receivables less any liabilities by the number of Fund shares outstanding. Market price is determined by the midpoint of the bid/ask spread at 4:00 p.m. Eastern Time from the primary listing exchange. Market price returns may vary from NAV returns.* 

*Performance quoted represents past performance and does not guarantee future results. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Unlike the index that the Fund seeks to track, the Fund's total returns are reduced by operating expenses, such as transaction costs and management fees. An investor cannot invest directly in an index.* 

*Performance reflects contractual reimbursements in effect until March 1, 2023. In the absence of such reimbursements, performance would be reduced. The gross expense ratio of the Fund is 0.56% and the net expense ratio is 0.35%. The gross and net expense ratios disclosed are as reported in the Fund's prospectus, which may differ from the gross and net expense ratios presented in the Fund's financial reports. Current performance may be higher or lower than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed or sold in the market.* 

*FlexShares ETFs' performance data current to the most recent month-end is available at <u>www.flexshares.com</u>.* 

**PORTFOLIO ANALYSIS** 

The Fund seeks total return and preservation of capital. The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets in U.S. dollar-denominated investment-grade fixed-income securities either directly or indirectly through exchange-traded funds ("ETFs") and other registered investment companies (together with ETFs, "Underlying Funds"). The Fund primarily invests in fixed-rate securities of varying maturities, including bonds, debt securities and other similar instruments issued by U.S. public and U.S and non-U.S. private sector entities. Such issuers include, without limitation, U.S. governments and their agencies, instrumentalities or sponsored enterprises, and U.S. and non-U.S. private-sector entities, such as corporations and banks. The Fund may invest in fixed income securities of any maturity.

The Fund seeks to provide attractive risk-adjusted performance by investing in a portfolio of fixed-income securities and Underlying Funds. The Fund generally adjusts its allocations to securities based on Northern Trust Investment Inc.'s ("NTI") assessment of potential changes in interest rate levels, the shape of the yield curve<sup>1</sup> and credit spread relationships, which is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality. The Fund also seeks to balance the potential for return and risk while emphasizing liquidity and diversification across a spectrum of U.S. dollar-denominated investment-grade fixed income securities.

During the 12 months ending October 31, 2022, prices on domestic equities generally traded lower. Through Q4 of 2021 U.S. equity markets rose as economic data and strong corporate earnings suggested continued growth, allaying concerns over a spike in Covid cases due to the Omicron variant. U.S. equities declined in Q1 of 2022 as concerns over rising inflation were intensified by

<sup>1</sup> A yield curve is constructed by plotting a session's final yields for various maturities including 1-month, 3-month, 6-month, 1-year, 2-year, 3-year, 5-year, 7-year, 10-year, 20-year and 30-year maturities.

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## Core Select Bond Fund (cont.)

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**PORTFOLIO ANALYSIS (cont.)** 

Russia's invasion of Ukraine and the impact subsequent sanctions from the U.S. and European countries had on commodity prices. In an attempt to combat inflation, the U.S. Federal Reserve (the "Fed") raised the key interest rate<sup>2</sup> by 0.25% in March 2022 and signaled more aggressive key interest rate hikes may be necessary. In Q1 of 2022 the Fed indeed moved to tighten monetary conditions. Our analysis suggests that by early in Q1 of 2022 investors anticipated the need for the Fed to address higher inflation and the U.S. yield curve steepened—which meant that short term interest rates fell faster than long term interest rates. Intermediate Treasury yields, defined as Treasury bonds equal to or less than 10 years to maturity, moved higher. This movement of yields eventually led to an inverting of the yield curve which happens when the 2-year maturing note yields more than the corresponding yield on a 10-year bond. The Fed increased the key interest rate 0.50% in May and 0.75% in June while signaling additional aggressive key interest rate hikes at future meetings were likely. as the Fed continued raising the key interest rate with two 0.75% increases in July and September.

Fed rate actions and U.S. inflation results had a major impact on real yields<sup>3</sup> during the period which steadily increased with Fed key interest rate hikes. Short-term real yields increased the most as the key interest rate moved above 3.00% while intermediate and long-term, those bonds with greater than 15+ years to maturity, real yields also increased. We believe that investor expectations for rebounding corporate revenues and earnings along with investor pursuit of higher yields led to increased demand for U.S. corporate credit securities. Intermediate-term<sup>4</sup> credit spreads<sup>5</sup> trended lower into the fiscal year. Further robust economic recovery and consumer/business spending helped drive average

Intermediate-term option adjusted spreads (OAS)<sup>6</sup> to 63 basis points ("bps")<sup>7</sup> in comparison to comparable maturing Treasury securities by fiscal year from 94 bps at the beginning of the fiscal year.<sup>8</sup>

At the beginning of the fiscal year, the Fund, in comparison to the Bloomberg U.S. Aggregate Bond Index, was generally positioned with an underweight to U.S. Treasuries and mortgage backed securities and an overweight to corporate fixed income on our expectations for lower, but still positive, economic growth and corporate earnings. By the time the Fed commenced raising interest rates in Q1 of 2022, the corporate credit overweight had been reduced, inflation protected public obligations of the U.S. Treasury ("TIPS") exposure was added for Treasuries and cash balances were maintained. When Fed Chair Powell indicated continued tightening of monetary policy, the corporate overweight had been again reduced and cash balances further increased. By fiscal year end, corporate credit positioning was neutral, Treasuries were still underweight and cash balances were near all-time highs since inception of the Fund. The overall increase in interest rates along with the widening of credit spreads lead to negative total returns for the fiscal year. The Underlying Index had a negative total return during the 12 months ended October 31, 2022, and underperformed the broader bond index, as defined by the Bloomberg U.S. Aggregate Bond Index<sup>9</sup>, by -59 bps.

<sup>2</sup> The key interest rate is the interest rate charged to banks when they borrow funds from other banks or from the Federal Reserve, which is the central bank of the U.S. When banks lend money to each other, the key rate is known as the federal funds rate.

<sup>3</sup> A real yield is the yield to the investor that has been adjusted to remove the effects of inflation.

<sup>4</sup> Intermediate-term bonds typically mature between 3–10 years.

<sup>5</sup> Credit spread is the difference in yield between one debt security and another debt security with the same maturity but of lesser quality.

<sup>6</sup> The option-adjusted spread (OAS) is the measurement of the spread of a fixed-income security rate or portfolio and typically the Treasury securities yield (often referred to as the risk-free rate) and that spread is added to the fixed-income security for comparison purposes.

<sup>7</sup> A unit that is equal to 1/100th of 1% and is used to denote the change in a financial instrument. 

<sup>8</sup> Source: Bloomberg, in this analysis we are making a comparison between the difference of the Option Adjusted Spread of intermediate-term investment grade corporate bonds using data available on the Bloomberg US Intermediate Corporate Bond Index as of October 31, 2021 – October 31, 2022. 

<sup>9</sup> The Bloomberg US Aggregate Bond Index, or the Agg, is a broad base, market capitalization-weighted bond market index representing intermediate term investment grade bonds traded in the United States.

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## FlexShares<sup>®</sup> Trust

## Statements of Assets and Liabilities October 31, 2022

------

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| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>US Quality<br>Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Developed Markets ex-US<br> Quality Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Emerging Markets<br> Quality Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Morningstar US<br> Market Factor Tilt<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $150849786 | $66583161 | $9468208 | $931864979 |
|  Affiliate securities, at cost |  |  |  | 507052 |
|  Securities Lending Reinvestments, at cost | 1156911 | 481336 |  | 203821768 |
|  Securities, at value† | 161976002 | 60676378 | 8151646 | 1384772126 |
|  Affiliate securities, at value |  |  |  | 564807 |
|  Securities Lending Reinvestments, at value | 1156911 | 481336 |  | 203816815 |
|  Cash | 284048 | 320646 | 51956 | 10513546 |
|  Cash segregated at broker\* | 5315 | 128915 | 13409 | 908884 |
|  Foreign cash†† |  | 355064 | 18459 |  |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts |  | 16928 |  |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 347030 | 423339 | 3699 | 940543 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 1588 | 313 |  | 55141 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold |  | 43 |  | 7508057 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 1483 |  |  | 211227 |
|  **Total Assets** | **163772377** | **62402962** | **8239169** | **1609291146** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts |  | 1982 |  |  |
|  Due to brokers | 11030 |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 1156911 | 481336 |  | 203821768 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 4531 | 2820 | 479 | 139501 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 28724 | 16314 | 2797 | 282841 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 2658 | 1446 | 341 | 29304 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  | 9995 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant |  |  |  | 6617 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  | 47316 | 7665 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  | 7597613 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other |  |  | 4000 | 6000 |
|  **Total Liabilities** | **1203854** | **551214** | **25277** | **211883644** |
|  **Net Assets** | $**162568523** | $**61851748** | $**8213892** | $**1397407502** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $155113380 | $71751996 | $10629918 | $964450457 |
|  Distributable earnings (loss) | 7455143 | (9900248) | (2416026) | 432957045 |
|  **Net Assets** | $**162568523** | $**61851748** | $**8213892** | $**1397407502** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 3250001 | 2800001 | 400001 | 9250001 |
|  Net Asset Value | $50.02 | $22.09 | $20.53 | $151.07 |
|  † Securities on loan, at value | $14183739 | $2551916 | $— | $275892234 |
|  †† Cost of foreign cash | $— | $356137 | $18711 | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 69

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##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Morningstar Developed<br>Markets ex-US Factor<br>Tilt Index Fund | FlexShares<sup>®</sup><br>Morningstar Emerging<br>Markets Factor Tilt<br>Index Fund | FlexShares<sup>®</sup><br>US Quality<br>Large Cap<br>Index Fund | FlexShares<sup>®</sup><br>STOXX<sup>®</sup> US<br>ESG Select<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $462257177 | $227162575 | $126865011 | $169811069 |
|  Affiliate securities, at cost |  |  |  |  |
|  Securities Lending Reinvestments, at cost | 7591069 | 3027697 | 264465 | 225693 |
|  Securities, at value† | 435473234 | 206025113 | 125453875 | 170751844 |
|  Affiliate securities, at value |  |  |  |  |
|  Securities Lending Reinvestments, at value | 7591069 | 3027697 | 264465 | 225693 |
|  Cash | 2167619 | 562244 | 1574827 | 1085736 |
|  Cash segregated at broker\* | 1801241 | 293055 | 325154 | 135778 |
|  Foreign cash†† | 3688221 | 836493 |  |  |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts | 53896 | 37421 |  |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 3851822 | 262703 | 122541 | 110490 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 29235 | 9896 | 790 | 562 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  | 2175103 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold | 172399 |  | 3195205 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 47214 |  |  |  |
|  **Total Assets** | **454875950** | **211054622** | **133111960** | **172310103** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts | 105386 | 32909 |  |  |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 7591069 | 3027697 | 264465 | 225693 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 83761 | 41902 | 4785 | 5691 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 143260 | 104097 | 28954 | 44385 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 12396 | 6743 | 1402 | 3487 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  | 5188 | 2135643 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  | 720142 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant | 172398 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  | 177031 | 69533 | 49871 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  | 3254338 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 13500 | 50000 | 3000 | 1050 |
|  **Total Liabilities** | **8121770** | **4165709** | **5762120** | **330177** |
|  **Net Assets** | $**446754180** | $**206888913** | $**127349840** | $**171979926** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $593533354 | $300134185 | $133331926 | $177469288 |
|  Distributable earnings (loss) | (146779174) | (93245272) | (5982086) | (5489362) |
|  **Net Assets** | $**446754180** | $**206888913** | $**127349840** | $**171979926** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 8200001 | 4900001 | 2950001 | 1850001 |
|  Net Asset Value | $54.48 | $42.22 | $43.17 | $92.96 |
|  † Securities on loan, at value | $52637337 | $8215520 | $7725995 | $9174813 |
|  †† Cost of foreign cash | $3668199 | $845705 | $— | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

70 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>STOXX<sup>®</sup><br>Global ESG<br>Select<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate US<br>Large Cap Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Developed<br>Markets ex-US Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Emerging<br>Markets Core<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $136248995 | $23943923 | $20549885 | $4923430 |
|  Affiliate securities, at cost |  |  |  |  |
|  Securities Lending Reinvestments, at cost | 442946 |  |  |  |
|  Securities, at value† | 145829313 | 21936504 | 17060066 | 3824002 |
|  Affiliate securities, at value |  |  |  |  |
|  Securities Lending Reinvestments, at value | 442946 |  |  |  |
|  Cash | 630009 | 151787 | 11858 | 19663 |
|  Cash segregated at broker\* | 126290 | 4474 | 20924 | 9835 |
|  Foreign cash†† | 95996 |  | 26497 | 17586 |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts | 4596 |  | 3717 |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 347364 | 18395 | 54875 | 4639 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 889 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  | 19 | 38 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold |  |  |  | 8982 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **147477403** | **22111179** | **17177975** | **3884707** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts |  |  | 927 |  |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 442946 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 7203 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 50063 | 1618 | 1681 | 610 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 3575 | 68 | 67 | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  |  |  | 9533 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 48139 | 5608 | 6380 | 6810 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other |  | 500 |  |  |
|  **Total Liabilities** | **551926** | **7794** | **9055** | **16972** |
|  **Net Assets** | $**146925477** | $**22103385** | $**17168920** | $**3867735** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $144004252 | $24293000 | $21578641 | $5009376 |
|  Distributable earnings (loss) | 2921225 | (2189615) | (4409721) | (1141641) |
|  **Net Assets** | $**146925477** | $**22103385** | $**17168920** | $**3867735** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 1250001 | 500000 | 450000 | 100000 |
|  Net Asset Value | $117.54 | $44.21 | $38.15 | $38.68 |
|  † Securities on loan, at value | $3600349 | $— | $— | $— |
|  †† Cost of foreign cash | $96981 | $— | $26388 | $17868 |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 71

------

##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Morningstar Global<br>Upstream Natural<br>Resources Index<br>Fund | FlexShares<sup>®</sup><br>STOXX<sup>®</sup><br>Global Broad<br>Infrastructure<br>Index Fund | FlexShares<sup>®</sup><br>Global Quality<br>Real Estate<br>Index Fund | FlexShares<sup>®</sup><br>Real Assets<br>Allocation<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $5959339348 | $2547512547 | $359689932 | $— |
|  Affiliate securities, at cost |  |  |  | 34201324 |
|  Securities Lending Reinvestments, at cost | 200125034 | 27954570 | 2527416 |  |
|  Securities, at value† | 6820447853 | 2481997953 | 320007900 |  |
|  Affiliate securities, at value |  |  |  | 28858364 |
|  Securities Lending Reinvestments, at value | 200121818 | 27954570 | 2527416 |  |
|  Cash | 4814695 | 7771116 | 5463557 | 9903 |
|  Cash segregated at broker\* | 3384673 | 2567896 | 1135692 |  |
|  Foreign cash†† | 6014133 | 4017253 | 663461 |  |
|  Restricted cash\*\* |  | 203240 |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts | 699659 |  | 42549 |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 3760445 | 6674598 | 1333352 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 49883 | 37964 | 4154 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold | 166946 | 22061 | 6817 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **7039460105** | **2531246651** | **331184898** | **28868267** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts | 988169 | 48973 | 28860 |  |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 200125034 | 27954570 | 2527416 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 477815 | 135252 | 25924 | 539 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 2601155 | 946185 | 119883 | 2399 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 92639 | 45453 | 8654 | 713 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  | 1288011 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant | 166946 | 203240 | 6817 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 127853 | 80554 | 84663 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 28500 | 26000 | 2000 |  |
|  **Total Liabilities** | **204608111** | **30728238** | **2804217** | **3651** |
|  **Net Assets** | $**6834851994** | $**2500518413** | $**328380681** | $**28864616** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $7129777702 | $2750801700 | $404471048 | $34563743 |
|  Distributable earnings (loss) | (294925708) | (250283287) | (76090367) | (5699127) |
|  **Net Assets** | $**6834851994** | $**2500518413** | $**328380681** | $**28864616** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 165300001 | 51750001 | 6300001 | 1000001 |
|  Net Asset Value | $41.35 | $48.32 | $52.12 | $28.86 |
|  † Securities on loan, at value | $464678070 | $156517412 | $39476466 | $— |
|  †† Cost of foreign cash | $5450282 | $4029437 | $662616 | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

72 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Index Fund | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Defensive<br>Index Fund | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Dynamic<br>Index Fund | FlexShares<sup>®</sup><br>International<br>Quality<br>Dividend<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $1375589496 | $318037114 | $16262177 | $501071246 |
|  Affiliate securities, at cost |  |  |  |  |
|  Securities Lending Reinvestments, at cost | 243436675 | 16949737 | 247981 | 7868448 |
|  Securities, at value† | 1515318768 | 340028276 | 17688939 | 422801748 |
|  Affiliate securities, at value |  |  |  |  |
|  Securities Lending Reinvestments, at value | 243434668 | 16949737 | 247981 | 7868448 |
|  Cash | 6031784 | 4808744 | 254569 | 1092531 |
|  Cash segregated at broker\* | 501579 | 522499 | 122803 | 1518313 |
|  Foreign cash†† |  |  |  | 4075413 |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts |  |  |  | 26739 |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 1502690 | 310084 | 17632 | 3181180 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 66405 | 14440 | 708 | 23395 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold | 354875 |  |  | 169849 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **1767210769** | **362633780** | **18332632** | **440757616** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts |  |  |  | 42855 |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 243436675 | 16949737 | 247981 | 7868448 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 156707 | 37565 | 5817 | 66156 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 453927 | 102836 | 5324 | 169301 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 28994 | 8086 | 521 | 12289 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant | 354875 |  |  | 146837 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 44122 | 89828 | 10126 | 342638 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 5650 | 2150 | 400 | 12000 |
|  **Total Liabilities** | **244480950** | **17190202** | **270169** | **8660524** |
|  **Net Assets** | $**1522729819** | $**345443578** | $**18062463** | $**432097092** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $1437380841 | $350673014 | $16906787 | $692660025 |
|  Distributable earnings (loss) | 85348978 | (5229436) | 1155676 | (260562933) |
|  **Net Assets** | $**1522729819** | $**345443578** | $**18062463** | $**432097092** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 29125001 | 6825001 | 325001 | 23400001 |
|  Net Asset Value | $52.28 | $50.61 | $55.58 | $18.47 |
|  † Securities on loan, at value | $288651348 | $35270721 | $1462542 | $30462551 |
|  †† Cost of foreign cash | $— | $— | $— | $4069870 |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 73

------

##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>International<br>Quality Dividend<br>Defensive Index<br>Fund | FlexShares<sup>®</sup><br>International<br>Quality Dividend<br>Dynamic Index<br>Fund | FlexShares<sup>®</sup><br>iBoxx 3-Year<br>Target<br>Duration TIPS<br>Index Fund | FlexShares<sup>®</sup><br>iBoxx 5-Year<br>Target<br>Duration TIPS<br>Index Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $44872925 | $75550979 | $2273651424 | $705602536 |
|  Affiliate securities, at cost |  |  |  |  |
|  Securities Lending Reinvestments, at cost | 349142 | 1013466 |  |  |
|  Securities, at value† | 39803427 | 60865236 | 2154633577 | 642970545 |
|  Affiliate securities, at value |  |  |  |  |
|  Securities Lending Reinvestments, at value | 349142 | 1013466 |  |  |
|  Cash | 163293 | 282821 | 2818291 | 1329344 |
|  Cash segregated at broker\* | 112225 | 124396 |  |  |
|  Foreign cash†† | 173448 | 208436 |  |  |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  | 10609362 |  |
|  Unrealized appreciation on forward foreign currency contracts | 20867 | 12522 |  |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 341325 | 369291 | 3615545 | 1011100 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income | 2578 | 3400 | 13960 | 6881 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  | 1179224 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  | 4699 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold |  | 40468 | 98616564 | 55627008 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **40966305** | **62920036** | **2271491222** | **700944878** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts | 2597 | 2501 |  |  |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned | 349142 | 1013466 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 8927 | 4960 | 236413 | 84481 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 16807 | 24243 | 330329 | 97000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 1465 | 1679 | 21640 | 11391 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased |  |  | 102351207 | 56865508 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant |  | 40468 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | 35026 | 40862 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  | 10613018 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 7000 | 3500 |  |  |
|  **Total Liabilities** | **420964** | **1131679** | **113552607** | **57058380** |
|  **Net Assets** | $**40545341** | $**61788357** | $**2157938615** | $**643886498** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $73846030 | $96011229 | $2380587672 | $731665217 |
|  Distributable earnings (loss) | (33300689) | (34222872) | (222649057) | (87778719) |
|  **Net Assets** | $**40545341** | $**61788357** | $**2157938615** | $**643886498** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 2300001 | 2900001 | 91504000 | 27250001 |
|  Net Asset Value | $17.63 | $21.31 | $23.58 | $23.63 |
|  † Securities on loan, at value | $4025435 | $6321311 | $62732699 | $59169651 |
|  †† Cost of foreign cash | $173795 | $206985 | $— | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

74 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Disciplined<br>Duration MBS<br>Index Fund | FlexShares<sup>®</sup><br>Credit-Scored<br> US<br> Corporate Bond<br> Index Fund | FlexShares<sup>®</sup><br>Credit-Scored<br>US Long<br>Corporate Bond<br>Index Fund | FlexShares<sup>®</sup><br>High Yield<br> Value-Scored<br> Bond Index<br>Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $107353373 | $265179777 | $47766420 | $950787508 |
|  Affiliate securities, at cost |  |  |  |  |
|  Securities Lending Reinvestments, at cost |  |  |  |  |
|  Securities, at value† | 96171521 | 234820853 | 34694439 | 861008645 |
|  Affiliate securities, at value |  |  |  |  |
|  Securities Lending Reinvestments, at value |  |  |  |  |
|  Cash | 2016091 | 5422700 | 243115 | 6439383 |
|  Cash segregated at broker\* |  |  |  |  |
|  Foreign cash†† |  |  |  |  |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Unrealized appreciation on forward foreign currency contracts |  |  |  |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 291023 | 2279582 | 533685 | 16758714 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  | 10059379 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold |  | 10568298 | 1211484 | 72003214 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **98478635** | **253091433** | **36682723** | **966269335** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts |  |  |  |  |
|  Due to brokers |  |  |  |  |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) | 6126 | 12501 | 2935 | 5625 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 16549 | 44502 | 6540 | 271206 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 1798 | 5364 | 1133 | 9038 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased | 1263609 | 10887609 | 1173381 | 78034098 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 1600 | 2500 | 1000 | 4000 |
|  **Total Liabilities** | **1289682** | **10952476** | **1184989** | **78323967** |
|  **Net Assets** | $**97188953** | $**242138957** | $**35497734** | $**887945368** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $118177292 | $283117668 | $53543188 | $1057237406 |
|  Distributable earnings (loss) | (20988339) | (40978711) | (18045454) | (169292038) |
|  **Net Assets** | $**97188953** | $**242138957** | $**35497734** | $**887945368** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 4850001 | 5350001 | 900001 | 22150001 |
|  Net Asset Value | $20.04 | $45.26 | $39.44 | $40.09 |
|  † Securities on loan, at value | $— | $— | $— | $— |
|  †† Cost of foreign cash | $— | $— | $— | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 75

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##### [**Table of Contents**](#toc)

------

Statements of Assets and Liabilities (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>ESG & Climate<br>High Yield<br>Corporate Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Investment Grade<br>Corporate Core<br>Index Fund | FlexShares<sup>®</sup><br>Ready<br>Access<br>Variable<br>Income Fund | FlexShares<sup>®</sup><br>Core Select<br>Bond Fund |
|  **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** | **ASSETS** |
|  Securities, at cost | $20125816 | $27069070 | $869528367 | $112314776 |
|  Affiliate securities, at cost |  |  |  | 58798892 |
|  Securities Lending Reinvestments, at cost |  |  |  | 55525084 |
|  Securities, at value† | 19887403 | 21969323 | 858655437 | 101694979 |
|  Affiliate securities, at value |  |  |  | 55861232 |
|  Securities Lending Reinvestments, at value |  |  |  | 55525084 |
|  Cash | 192014 | 900596 | 9428427 | 2421028 |
|  Cash segregated at broker\* |  |  |  |  |
|  Foreign cash†† |  |  |  |  |
|  Restricted cash\*\* |  |  |  |  |
|  Due from Authorized Participant |  |  |  |  |
|  Due from Custodian |  | 42369 |  |  |
|  Unrealized appreciation on forward foreign currency contracts |  |  |  |  |
|  Receivables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends and interest | 344089 | 221923 | 3914134 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities lending income |  |  |  | 20059 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser |  |  | 2525 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities sold | 937986 | 621574 |  | 551493 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  |  |
|  **Total Assets** | **21361492** | **23755785** | **872000523** | **216073875** |
|  **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** | **LIABILITIES** |
|  Unrealized depreciation on forward foreign currency contracts |  |  |  |  |
|  Due to brokers |  |  |  | 4755 |
|  Payables: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash collateral received from securities loaned |  |  |  | 55525084 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred compensation (Note 7) |  |  | 26677 | 4838 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment advisory fees (Note 4) | 79 | 2331 | 177073 | 29205 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trustee fees (Note 7) | 737 | 577 | 7638 | 1771 |
| &nbsp;&nbsp;&nbsp;&nbsp; Securities purchased | 928335 | 595852 | 15428180 | 1142291 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred non-US capital gains taxes |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Due to Authorized Participant |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts |  |  |  | 3852 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capital shares redeemed |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 500 | 1500 | 4025 |  |
|  **Total Liabilities** | **929651** | **600260** | **15643593** | **56711796** |
|  **Net Assets** | $**20431841** | $**23155525** | $**856356930** | $**159362079** |
|  **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** | **NET ASSETS CONSIST OF:** |
|  Paid-in capital | $24326768 | $33560550 | $866349914 | $189199913 |
|  Distributable earnings (loss) | (3894927) | (10405025) | (9992984) | (29837834) |
|  **Net Assets** | $**20431841** | $**23155525** | $**856356930** | $**159362079** |
|  Shares Outstanding (unlimited number of shares authorized $0.0001 par value) | 500000 | 600000 | 11525001 | 7425001 |
|  Net Asset Value | $40.86 | $38.59 | $74.30 | $21.46 |
|  † Securities on loan, at value | $— | $— | $— | $53981888 |
|  †† Cost of foreign cash | $— | $— | $— | $— |

---

*\** *Includes cash pledged by the Fund to cover margin requirements for open futures contracts as of 10/31/22.* 

*\*\** *Includes cash pledged by an Authorized Participant for missing deposit securities required to secure Creation Units.* 

*See Accompanying Notes to the Financial Statements.* 

76 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## FlexShares<sup>®</sup> Trust

## Statements of Operations
For the year ended October 31, 2022

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>US Quality<br>Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Developed<br>Markets ex-US<br>Quality Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Emerging<br>Markets Quality<br>Low Volatility<br>Index Fund | FlexShares<sup>®</sup><br>Morningstar<br>US Market<br>Factor Tilt<br>Index Fund |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $2925652 | $2253066 | $494699 | $25820662 |
|  Income from non-cash dividends |  |  |  |  |
|  Dividend income received from affiliate |  |  |  | 18788 |
|  Interest income | 1260 |  |  |  |
|  Securities lending income (net of fees) (Note 2) | 12331 | 6911 |  | 588375 |
|  Foreign withholding tax on dividends | (7796) | (203717) | (49127) | (11116) |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **2931447** | **2056260** | **445572** | **26416709** |
|  **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** |
|  Deferred compensation (Note 7) | 1394 | 611 | 125 | 13125 |
|  Investment advisory fees | 357704 | 225185 | 56549 | 3837927 |
|  Trustee fees (Note 7) | 7159 | 3063 | 597 | 67536 |
|  Other expenses (Note 4) |  |  |  | 499 |
|  **Total Gross Expenses Before Fees Reimbursed** | **366257** | **228859** | **57271** | **3919087** |
|  **Less:** | **Less:** | **Less:** | **Less:** | **Less:** |
|  Fees reimbursed by investment advisor (Note 4) | (522) | (211) | (31) | (5294) |
|  **Total Net Expenses** | **365735** | **228648** | **57240** | **3913793** |
|  **Net Investment Income (Loss)** | **2565712** | **1827612** | **388332** | **22502916** |
|  **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** |
|  Transactions in investment securities of affiliated issuers |  |  |  | 20168 |
|  Transactions in investment securities | (2979504) | (3215500) | (644694)<sup>(1)</sup> | (4684416) |
|  In-kind redemptions on investments in affiliated securities |  |  |  | 18076 |
|  In-kind redemptions on investments in securities | 8249158 | 1241765 | (127745) | 75176145 |
|  Expiration or closing of futures contracts | (283104) | (294793) | (48717) | (2142809) |
|  Settlement of forward foreign currency contracts |  | 114349 | 1424 |  |
|  Foreign currency transactions |  | (78991) | (46555) |  |
|  **Net Realized Gain (Loss)** | **4986550** | **(2233170)** | **(866287)** | **68387164** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** | **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** | **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** | **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** | **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |
|  Investments in securities | (19709365) | (13494919) | (2317390)<sup>(2)</sup> | (329444776)<sup>(3)</sup> |
|  Securities lending |  |  |  | (4997) |
|  Futures contracts | (1744) | (47271) | (6048) | (170946) |
|  Forward foreign currency contracts |  | 9729 | (2) |  |
|  Translation of other assets and liabilities denominated in foreign currencies |  | (25210) | 1064 |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(19711109)** | **(13557671)** | **(2322376)** | **(329620719)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(14724559)** | **(15790841)** | **(3188663)** | **(261233555)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(12158847)** | $**(13963229)** | $**(2800331)** | $**(238730639)** |

---

*<sup>(1)</sup>* *Net of non-US capital gains tax of $(30907).* 

*<sup>(2)</sup>* *Net of deferred non-US capital gains tax of $9,995.* 

*<sup>(3)</sup>* *Includes $(287907) change in unrealized depreciation on investments in affiliates.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 77

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##### [**Table of Contents**](#toc)

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Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Morningstar<br>Developed<br>Markets ex-US<br>Factor Tilt<br>Index Fund | FlexShares<sup>®</sup><br>Morningstar Emerging<br>Markets Factor Tilt<br>Index Fund | FlexShares<sup>®</sup><br>US Quality<br>Large Cap<br>Index Fund | FlexShares<sup>®</sup><br>STOXX<sup>®</sup> US<br>ESG Select<br>Index Fund |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $19415738 | $12732437 | $2284909 | $2807589 |
|  Income from non-cash dividends | 1066208 |  |  |  |
|  Dividend income received from affiliate |  |  |  | 1575 |
|  Interest income | 22 | 7 |  |  |
|  Securities lending income (net of fees) (Note 2) | 437114 | 160511 | 11911 | 8610 |
|  Foreign withholding tax on dividends | (1988683) | (1413236) |  |  |
|  Foreign withholding tax on interest |  | (7) |  |  |
|  **Total Investment Income** | **18930399** | **11479712** | **2296820** | **2817774** |
|  **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** |
|  Deferred compensation (Note 7) | 4791 | 2468 | 1222 | 1585 |
|  Investment advisory fees | 2161436 | 1656739 | 424992 | 590773 |
|  Trustee fees (Note 7) | 24307 | 12278 | 6277 | 8117 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **2190534** | **1671485** | **432491** | **600475** |
|  **Less:** | **Less:** | **Less:** | **Less:** | **Less:** |
|  Fees reimbursed by investment advisor (Note 4) | (1805) | (1044) | (1790) | (569) |
|  **Total Net Expenses** | **2188729** | **1670441** | **430701** | **599906** |
|  **Net Investment Income (Loss)** | **16741670** | **9809271** | **1866119** | **2217868** |
|  **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** |
|  Transactions in investment securities of affiliated issuers |  |  |  | (24306) |
|  Transactions in investment securities | (2663097) | (13461292)<sup>(1)</sup> | (2172619) | (4127036) |
|  In-kind redemptions on investments in affiliated securities |  |  |  | (93) |
|  In-kind redemptions on investments in securities | 6893368 | 1253873 | 14142209 | 8342410 |
|  Expiration or closing of futures contracts | (755268) | (904011) | (273891) | (95274) |
|  Settlement of forward foreign currency contracts | (745024) | 160911 |  |  |
|  Foreign currency transactions | (1217558) | (307615) |  |  |
|  **Net Realized Gain (Loss)** | **1512421** | **(13258134)** | **11695699** | **4095701** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (161309408) | (79782880)<sup>(2)</sup> | (32689339) | (39458575) |
|  Securities lending |  |  |  |  |
|  Futures contracts | (55871) | (127750) | (95079) | (75559) |
|  Forward foreign currency contracts | 71255 | (4724) |  |  |
|  Translation of other assets and liabilities denominated in foreign currencies | (379882) | (5274) |  |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(161673906)** | **(79920628)** | **(32784418)** | **(39534134)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(160161485)** | **(93178762)** | **(21088719)** | **(35438433)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(143419815)** | $**(83369491)** | $**(19222600)** | $**(33220565)** |

---

*<sup>(1)</sup>* *Net of non-US capital gains tax of $(11144).* 

*<sup>(2)</sup>* *Net of deferred non-US capital gains tax of $719,339.* 

*See Accompanying Notes to the Financial Statements.* 

78 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>STOXX<sup>®</sup><br>Global ESG<br>Select<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate US<br>Large Cap Core<br>Index Fund | FlexShares<sup>®</sup> ESG &<br>Climate Developed<br>Markets ex-US Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Emerging Markets<br>Core Index Fund |
|  | | | | April 20,<br>2022\* through<br>October 31, 2022 |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $3701745 | $172902 | $517138 | $91679 |
|  Income from non-cash dividends |  |  |  |  |
|  Dividend income received from affiliate |  |  |  |  |
|  Interest income | 4 | 107 |  |  |
|  Securities lending income (net of fees) (Note 2) | 20284 |  |  |  |
|  Foreign withholding tax on dividends | (210629) |  | (59034) | (11413) |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **3511404** | **173009** | **458104** | **80266** |
|  **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** |
|  Deferred compensation (Note 7) | 1432 | 73 | 104 | 21 |
|  Investment advisory fees | 698019 | 9585 | 15800 | 4309 |
|  Trustee fees (Note 7) | 7277 | 471 | 581 | 108 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **706728** | **10129** | **16485** | **4438** |
|  **Less:** | **Less:** | **Less:** | **Less:** | **Less:** |
|  Fees reimbursed by investment advisor (Note 4) | (494) | (19) | (38) | (12) |
|  **Total Net Expenses** | **706234** | **10110** | **16447** | **4426** |
|  **Net Investment Income (Loss)** | **2805170** | **162899** | **441657** | **75840** |
|  **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** |
|  Transactions in investment securities of affiliated issuers |  |  |  |  |
|  Transactions in investment securities | (4600693) | (195104) | (913975) | (49403) |
|  In-kind redemptions on investments in affiliated securities |  |  |  |  |
|  In-kind redemptions on investments in securities | 8341868 | 80873 |  |  |
|  Expiration or closing of futures contracts | (387711) | (19215) | (43003) | (4688) |
|  Settlement of forward foreign currency contracts | 156936 |  | 2773 |  |
|  Foreign currency transactions | (157081) |  | (11912) | 8806 |
|  **Net Realized Gain (Loss)** | **3353319** | **(133446)** | **(966117)** | **(45285)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (41688994) | (2173361) | (3595140) | (1099428) |
|  Securities lending |  |  |  |  |
|  Futures contracts | (91583) | (6858) | (4776) | (6812) |
|  Forward foreign currency contracts | (6243) |  | 4137 |  |
|  Translation of other assets and liabilities denominated in foreign currencies | (11824) |  | (1384) | (292) |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(41798644)** | **(2180219)** | **(3597163)** | **(1106532)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(38445325)** | **(2313665)** | **(4563280)** | **(1151817)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(35640155)** | $**(2150766)** | $**(4121623)** | $**(1075977)** |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 79

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##### [**Table of Contents**](#toc)

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Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Morningstar Global<br>Upstream Natural<br>Resources Index<br>Fund | FlexShares<sup>®</sup><br>STOXX<sup>®</sup><br>Global Broad<br>Infrastructure<br>Index Fund | FlexShares<sup>®</sup><br>Global<br>Quality<br> Real Estate<br> Index Fund | FlexShares<sup>®</sup><br>Real Assets<br>Allocation<br>Index Fund |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $328254806 | $81355064 | $12762427 | $— |
|  Income from non-cash dividends | 45208148 |  |  |  |
|  Dividend income received from affiliate |  |  |  | 1093149 |
|  Interest income |  |  |  |  |
|  Securities lending income (net of fees) (Note 2) | 1614496 | 567457 | 63128 |  |
|  Foreign withholding tax on dividends | (14614391) | (5194825) | (474318) |  |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **360463059** | **76727696** | **12351237** | **1093149** |
|  **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** | **EXPENSES** |
|  Deferred compensation (Note 7) | 63094 | 21813 | 3510 | 325 |
|  Investment advisory fees | 33544536 | 12080810 | 1804239 | 209506 |
|  Trustee fees (Note 7) | 326096 | 113957 | 17625 | 1600 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **33933726** | **12216580** | **1825374** | **211431** |
|  **Less:** | **Less:** | **Less:** | **Less:** | **Less:** |
|  Fees reimbursed by investment advisor (Note 4) | (29020) | (8180) | (1286) | (170806) |
|  **Total Net Expenses** | **33904706** | **12208400** | **1824088** | **40625** |
|  **Net Investment Income (Loss)** | **326558353** | **64519296** | **10527149** | **1052524** |
|  **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** | **NET REALIZED GAIN (LOSS) FROM:** |
|  Transactions in investment securities of affiliated issuers |  |  |  | (231991) |
|  Transactions in investment securities | (57440335)<sup>(1)</sup> | (51294880)<sup>(2)</sup> | (9429173) |  |
|  In-kind redemptions on investments in affiliated securities |  |  |  | (115194) |
|  In-kind redemptions on investments in securities | 615401700 | 21478609 | 9996330 |  |
|  Expiration or closing of futures contracts | (8445121) | (1241022) | (1219139) |  |
|  Settlement of forward foreign currency contracts | (1217160) | (793098) | 34177 |  |
|  Foreign currency transactions | (4378904) | (2434316) | (587972) |  |
|  **Net Realized Gain (Loss)** | **543920180** | **(34284707)** | **(1205777)** | **(347185)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (256098969)<sup>(3)</sup> | (413002200)<sup>(4)</sup> | (112395870) | (6504289)<sup>(5)</sup> |
|  Securities lending | (3265) |  |  |  |
|  Futures contracts | (875882) | (434981) | (174520) |  |
|  Forward foreign currency contracts | (682867) | 201860 | 19617 |  |
|  Translation of other assets and liabilities denominated in foreign currencies | 144454 | (337764) | (54585) |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(257516529)** | **(413573085)** | **(112605358)** | **(6504289)** |
|  **Net Realized and Unrealized Gain (Loss)** | **286403651** | **(447857792)** | **(113811135)** | **(6851474)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**612962004** | $**(383338496)** | $**(103283986)** | $**(5798950)** |

---

*<sup>(1)</sup>* *Net of non-US capital gains tax of $(106852).* 

*<sup>(2)</sup>* *Net of non-US capital gains tax of $(346303).* 

*<sup>(3)</sup>* *Net of deferred non-US capital gains tax of $537,973.* 

*<sup>(4)</sup>* *Net of deferred non-US capital gains tax of $1,288,011.* 

*<sup>(5)</sup>* *Includes $(6504289) change in unrealized depreciation on investments in affiliates.* 

*See Accompanying Notes to the Financial Statements.* 

80 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Index Fund | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Defensive<br>Index Fund | FlexShares<sup>®</sup><br>Quality<br>Dividend<br>Dynamic<br>Index Fund | FlexShares<sup>®</sup><br>International<br>Quality<br>Dividend<br>Index Fund |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $41609388 | $10073709 | $493796 | $33788774 |
|  Income from non-cash dividends |  |  |  |  |
|  Dividend income received from affiliate |  |  |  |  |
|  Interest income |  |  |  |  |
|  Securities lending income (net of fees) (Note 2) | 573559 | 118070 | 6113 | 209170 |
|  Foreign withholding tax on dividends |  |  |  | (3306424) |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **42182947** | **10191779** | **499909** | **30691520** |
|  **EXPENSES** |  |  |  |  |
|  Deferred compensation (Note 7) | 13793 | 3515 | 177 | 4776 |
|  Investment advisory fees | 5972446 | 1484915 | 75485 | 2582906 |
|  Trustee fees (Note 7) | 71345 | 17566 | 854 | 24161 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **6057584** | **1505996** | **76516** | **2611843** |
|  **Less:** |  |  |  |  |
|  Fees reimbursed by investment advisor (Note 4) | (4869) | (1162) | (18) | (1944) |
|  **Total Net Expenses** | **6052715** | **1504834** | **76498** | **2609899** |
|  **Net Investment Income (Loss)** | **36130232** | **8686945** | **423411** | **28081621** |
|  **NET REALIZED GAIN (LOSS) FROM:** |  |  |  |  |
|  Transactions in investment securities of affiliated issuers |  |  |  |  |
|  Transactions in investment securities | (47778501) | (8258739) | (151822) | (33464887) |
|  In-kind redemptions on investments in affiliated securities |  |  |  |  |
|  In-kind redemptions on investments in securities | 124766672 | 44746230 | 1581915 | 2302932 |
|  Expiration or closing of futures contracts | (2464197) | (874263) | (41226) | (2280920) |
|  Settlement of forward foreign currency contracts |  |  |  | (813046) |
|  Foreign currency transactions |  |  |  | (1133722) |
|  **Net Realized Gain (Loss)** | **74523974** | **35613228** | **1388867** | **(35389643)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (248671370) | (74828907) | (3851489) | (140207633) |
|  Securities lending | (2043) |  |  |  |
|  Futures contracts | (284371) | (138287) | (19610) | (335187) |
|  Forward foreign currency contracts |  |  |  | 81207 |
|  Translation of other assets and liabilities denominated in foreign currencies |  |  |  | (270285) |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(248957784)** | **(74967194)** | **(3871099)** | **(140731898)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(174433810)** | **(39353966)** | **(2482232)** | **(176121541)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(138303578)** | $**(30667021)** | $**(2058821)** | $**(148039920)** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 81

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##### [**Table of Contents**](#toc)

------

Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>International<br>Quality<br>Dividend<br>Defensive<br>Index Fund | FlexShares<sup>®</sup><br>International<br>Quality<br>Dividend<br>Dynamic<br>Index Fund | FlexShares<sup>®</sup><br>iBoxx 3-Year<br>Target<br>Duration TIPS<br>Index Fund | FlexShares<sup>®</sup><br>iBoxx 5-Year<br>Target<br>Duration TIPS<br>Index Fund |
|  **INVESTMENT INCOME** |  |  |  |  |
|  Dividend income | $3417924 | $4476464 | $— | $— |
|  Income from non-cash dividends |  | 461798 |  |  |
|  Dividend income received from affiliate |  |  |  |  |
|  Interest income |  |  | 133398438 | 53746461 |
|  Securities lending income (net of fees) (Note 2) | 29890 | 41027 | 68825 | 53720 |
|  Foreign withholding tax on dividends | (326249) | (477781) |  |  |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **3121565** | **4501508** | **133467263** | **53800181** |
|  **EXPENSES** |  |  |  |  |
|  Deferred compensation (Note 7) | 541 | 651 | 15978 | 6580 |
|  Investment advisory fees | 287883 | 354718 | 3426960 | 1350627 |
|  Administration fees (Note 5) |  |  |  | 30372 |
|  Trustee fees (Note 7) | 2664 | 3307 | 85572 | 33236 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **291088** | **358676** | **3528510** | **1420815** |
|  **Less:** |  |  |  |  |
|  Fees reimbursed by investment advisor (Note 4) | (198) | (248) | (8159) | (33375) |
|  **Total Net Expenses** | **290890** | **358428** | **3520351** | **1387440** |
|  **Net Investment Income (Loss)** | **2830675** | **4143080** | **129946912** | **52412741** |
|  **NET REALIZED GAIN (LOSS) FROM:** |  |  |  |  |
|  Transactions in investment securities of affiliated issuers |  |  |  |  |
|  Transactions in investment securities | (4697687)<sup>(1)</sup> | (5809981)<sup>(2)</sup> | (62652067) | (25865562) |
|  In-kind redemptions on investments in affiliated securities |  |  |  |  |
|  In-kind redemptions on investments in securities | 238765 | 14821 | 1449246 | 2289950 |
|  Expiration or closing of futures contracts | (422328) | (481777) |  |  |
|  Settlement of forward foreign currency contracts | 174674 | 96732 |  |  |
|  Foreign currency transactions | (184098) | (155944) |  |  |
|  **Net Realized Gain (Loss)** | **(4890674)** | **(6336149)** | **(61202821)** | **(23575612)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (12660048) | (19614243) | (171934382) | (102258738) |
|  Securities lending |  |  |  |  |
|  Futures contracts | (18210) | (30953) |  |  |
|  Forward foreign currency contracts | 4749 | 5959 |  |  |
|  Translation of other assets and liabilities denominated in foreign currencies | (34097) | (28660) |  |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(12707606)** | **(19667897)** | **(171934382)** | **(102258738)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(17598280)** | **(26004046)** | **(233137203)** | **(125834350)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(14767605)** | $**(21860966)** | $**(103190291)** | $**(73421609)** |

---

*<sup>(1)</sup>* *Net of non-US capital gains tax of $696.* 

*<sup>(2)</sup>* *Net of non-US capital gains tax of $(12389).* 

*See Accompanying Notes to the Financial Statements.* 

82 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>Disciplined<br>Duration MBS<br>Index Fund | FlexShares<sup>®</sup><br>Credit-<br>Scored US<br>Corporate Bond<br>Index Fund | FlexShares<sup>®</sup><br>Credit-Scored<br>US Long<br>Corporate Bond<br>Index Fund | FlexShares<sup>®</sup><br>High<br>Yield Value-<br>Scored Bond<br>Index Fund |
|  **INVESTMENT INCOME** |  |  |  |  |
|  Dividend income | $— | $— | $— | $— |
|  Income from non-cash dividends |  |  |  |  |
|  Dividend income received from affiliate |  |  |  |  |
|  Interest income | 1542337 | 6248942 | 2008279 | 57253411 |
|  Securities lending income (net of fees) (Note 2) |  |  |  |  |
|  Foreign withholding tax on dividends |  |  |  |  |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **1542337** | **6248942** | **2008279** | **57253411** |
|  **EXPENSES** |  |  |  |  |
|  Deferred compensation (Note 7) | 939 | 2288 | 433 | 6668 |
|  Investment advisory fees | 221444 | 588642 | 108214 | 2949144 |
|  Trustee fees (Note 7) | 4878 | 11670 | 2128 | 35858 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **227261** | **602600** | **110775** | **2991670** |
|  **Less:** |  |  |  |  |
|  Fees reimbursed by investment advisor (Note 4) | (382) | (828) | (144) | (3238) |
|  **Total Net Expenses** | **226879** | **601772** | **110631** | **2988432** |
|  **Net Investment Income (Loss)** | **1315458** | **5647170** | **1897648** | **54264979** |
|  **NET REALIZED GAIN (LOSS) FROM:** |  |  |  |  |
|  Transactions in investment securities of affiliated issuers |  |  |  |  |
|  Transactions in investment securities | (4182658) | (10722054) | (5104776) | (84076492) |
|  In-kind redemptions on investments in affiliated securities |  |  |  |  |
|  In-kind redemptions on investments in securities |  | (802474) |  | (747168) |
|  Expiration or closing of futures contracts |  |  |  |  |
|  Settlement of forward foreign currency contracts |  |  |  |  |
|  Foreign currency transactions |  |  |  |  |
|  **Net Realized Gain (Loss)** | **(4182658)** | **(11524528)** | **(5104776)** | **(84823660)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | (11405968) | (31515973) | (14928195) | (89845656) |
|  Securities lending |  |  |  |  |
|  Futures contracts |  |  |  |  |
|  Forward foreign currency contracts |  |  |  |  |
|  Translation of other assets and liabilities denominated in foreign currencies |  |  |  |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **(11405968)** | **(31515973)** | **(14928195)** | **(89845656)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(15588626)** | **(43040501)** | **(20032971)** | **(174669316)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(14273168)** | $**(37393331)** | $**(18135323)** | $**(120404337)** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 83

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##### [**Table of Contents**](#toc)

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Statements of Operations (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>ESG & Climate<br>High Yield<br>Corporate Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Investment Grade<br>Corporate Core<br>Index Fund | FlexShares<sup>®</sup><br>Ready<br>Access<br>Variable<br>Income Fund | FlexShares<sup>®</sup><br>Core Select<br>Bond Fund |
|  **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** | **INVESTMENT INCOME** |
|  Dividend income | $— | $— | $— | $1695332 |
|  Income from non-cash dividends |  |  |  |  |
|  Dividend income received from affiliate |  |  |  | 1787315 |
|  Interest income | 1060998 | 1076341 | 10127650 | 8998 |
|  Securities lending income (net of fees) (Note 2) |  |  |  | 104648 |
|  Foreign withholding tax on dividends |  |  |  |  |
|  Foreign withholding tax on interest |  |  |  |  |
|  **Total Investment Income** | **1060998** | **1076341** | **10127650** | **3596293** |
|  **EXPENSES** |  |  |  |  |
|  Deferred compensation (Note 7) | 207 | 387 | 4860 | 1200 |
|  Investment advisory fees | 52998 | 50966 | 1503233 | 512397 |
|  Trustee fees (Note 7) | 1132 | 1849 | 27136 | 6547 |
|  Other expenses (Note 4) |  |  |  |  |
|  **Total Gross Expenses Before Fees Reimbursed** | **54337** | **53202** | **1535229** | **520144** |
|  **Less:** |  |  |  |  |
|  Fees reimbursed by investment advisor (Note 4) | (206) | (154) | (2525) | (202703) |
|  **Total Net Expenses** | **54131** | **53048** | **1532704** | **317441** |
|  **Net Investment Income (Loss)** | **1006867** | **1023293** | **8594946** | **3278852** |
|  **NET REALIZED GAIN (LOSS) FROM:** |  |  |  |  |
|  Transactions in investment securities of affiliated issuers |  |  |  | (7627842) |
|  Transactions in investment securities | (3550393) | (5269138) | (815721) | (7382999) |
|  In-kind redemptions on investments in affiliated securities |  |  |  | 3719 |
|  In-kind redemptions on investments in securities | (72176) |  |  | 102560 |
|  Expiration or closing of futures contracts |  |  |  | 1174 |
|  Settlement of forward foreign currency contracts |  |  |  |  |
|  Foreign currency transactions |  |  |  |  |
|  **Net Realized Gain (Loss)** | **(3622569)** | **(5269138)** | **(815721)** | **(14903388)** |
|  **NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:** |  |  |  |  |
|  Investments in securities | 171352 | (4417178) | (11518881) | (13963561)<sup>(1)</sup> |
|  Securities lending |  |  |  |  |
|  Futures contracts |  |  |  | (3960) |
|  Forward foreign currency contracts |  |  |  |  |
|  Translation of other assets and liabilities denominated in foreign currencies |  |  |  |  |
|  **Net Change in Unrealized Appreciation (Depreciation)** | **171352** | **(4417178)** | **(11518881)** | **(13967521)** |
|  **Net Realized and Unrealized Gain (Loss)** | **(3451217)** | **(9686316)** | **(12334602)** | **(28870909)** |
|  **Net Increase (Decrease) in Net Assets Resulting from Operations** | $**(2444350)** | $**(8663023)** | $**(3739656)** | $**(25592057)** |

---

*<sup>(1)</sup>* *Includes $(2999007) change in unrealized depreciation on investments in affiliates.* 

*See Accompanying Notes to the Financial Statements.* 

84 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## FlexShares<sup>®</sup> Trust

## Statements of Changes in Net Assets

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> US Quality Low<br>Volatility Index Fund | FlexShares<sup>®</sup> US Quality Low<br>Volatility Index Fund | FlexShares<sup>®</sup> Developed Markets<br>ex-US Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Developed Markets<br>ex-US Quality Low Volatility Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $2565712 | $1643691 | $1827612 | $2226694 |
|  Net realized gain (loss) | 4986550 | 9877154 | (2233170) | 4060236 |
|  Net change in unrealized appreciation (depreciation) | (19711109) | 29486420 | (13557671) | 8924507 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(12158847)** | **41007265** | **(13963229)** | **15211437** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (2196287) | (1694565) | (2140729) | (2249889) |
|  **Total distributions** | **(2196287)** | **(1694565)** | **(2140729)** | **(2249889)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 51896738 | 56108720 | 10600255 | 13390874 |
|  Cost of shares redeemed | (36047573) | (44870466) | (8015506) | (16728469) |
|  **Net Increase (Decrease) from Capital Transactions** | **15849165** | **11238254** | **2584749** | **(3337595)** |
|  **Total Increase (Decrease) in Net Assets** | **1494031** | **50550954** | **(13519209)** | **9623953** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $161074492 | $110523538 | $75370957 | $65747004<sup>(3)</sup> |
|  **End of Period** | $**162568523** | $**161074492** | $**61851748** | $**75370957** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 2950001 | 2700001 | 2700001 | 2800001 |
|  Shares issued |  |  | 100000 |  |
|  Shares issued in-kind | 1000000 | 1150000 | 300000 | 500000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (700000) | (900000) | (300000) | (600000) |
|  **Shares Outstanding, End of Period** | **3250001** | **2950001** | **2800001** | **2700001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*<sup>(3)</sup>* *Includes amounts paid in capital from the Authorized Participant in addition to the order's original cash component. This amount is made to offset taxes, commissions, and price differences from the NAV that would otherwise impact the fund on these order trades.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 85

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Emerging Markets<br>Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Emerging Markets<br>Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Morningstar US<br>Market Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar US<br>Market Factor Tilt Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $388332 | $384138 | $22502916 | $20467734 |
|  Net realized gain (loss) | (866287) | 204217 | 68387164 | 125723634 |
|  Net change in unrealized appreciation (depreciation) | (2322376) | 669161 | (329620719) | 436303767 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(2800331)** | **1257516** | **(238730639)** | **582495135** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (416284) | (269007) | (22299297) | (19993786) |
|  Tax return of capital | (24777) |  |  |  |
|  **Total distributions** | **(441061)** | **(269007)** | **(22299297)** | **(19993786)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued |  | 5276872 | 59308274 | 95734574 |
|  Cost of shares redeemed | (4388407) |  | (127889854) | (106003334) |
|  **Net Increase (Decrease) from Capital Transactions** | **(4388407)** | **5276872** | **(68581580)** | **(10268760)** |
|  **Total Increase (Decrease) in Net Assets** | **(7629799)** | **6265381** | **(329611516)** | **552232589** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $15843691 | $9578310<sup>(3)</sup> | $1727019018 | $1174786429 |
|  **End of Period** | $**8213892** | $**15843691** | $**1397407502** | $**1727019018** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 600001 | 400001 | 9650001 | 9700001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind |  | 200000 | 350000 | 600000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (200000) |  | (750000) | (650000) |
|  **Shares Outstanding, End of Period** | **400001** | **600001** | **9250001** | **9650001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*<sup>(3)</sup>* *Includes amounts paid in capital from the Authorized Participant in addition to the order's original cash component. This amount is made offset taxes, commissions, and price differences from the NAV that would otherwise impact the fund on these order trades.* 

*See Accompanying Notes to the Financial Statements.* 

86 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar<br>Developed Markets ex-US<br>Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar<br>Developed Markets ex-US<br>Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar<br>Emerging Markets Factor Tilt<br>Index Fund | FlexShares<sup>®</sup> Morningstar<br>Emerging Markets Factor Tilt<br>Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $16741670 | $15324867 | $9809271 | $7624187 |
|  Net realized gain (loss) | 1512421 | 21856890 | (13258134) | 25611349 |
|  Net change in unrealized appreciation (depreciation) | (161673906) | 152302928 | (79920628) | 31176773 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(143419815)** | **189484685** | **(83369491)** | **64412309** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (22504833) | (13410048) | (12431512) | (6011707) |
|  Tax return of capital | (992999) |  |  |  |
|  **Total distributions** | **(23497832)** | **(13410048)** | **(12431512)** | **(6011707)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 14617000 | 44016396 | 10793304 | 50124591 |
|  Cost of shares redeemed | (49583666) | (70468136) | (42475383) |  |
|  **Net Increase (Decrease) from Capital Transactions** | **(34966666)** | **(26451740)** | **(31682079)** | **50124591** |
|  **Total Increase (Decrease) in Net Assets** | **(201884313)** | **149622897** | **(127483082)** | **108525193** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $648638493 | $499015596 | $334371995 | $225846802 |
|  **End of Period** | $**446754180** | $**648638493** | $**206888913** | $**334371995** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 8800001 | 9200001 | 5500001 | 4700001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 200000 | 600000 | 200000 | 800000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (800000) | (1000000) | (800000) |  |
|  **Shares Outstanding, End of Period** | **8200001** | **8800001** | **4900001** | **5500001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 87

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> US Quality<br>Large Cap Index Fund | FlexShares<sup>®</sup> US Quality<br>Large Cap Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US<br>ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US<br>ESG Select Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $1866119 | $1172409 | $2217868 | $2051388 |
|  Net realized gain (loss) | 11695699 | 5820892 | 4095701 | 25495358 |
|  Net change in unrealized appreciation (depreciation) | (32784418) | 26126364 | (39534134) | 24935787 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(19222600)** | **33119665** | **(33220565)** | **52482533** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** |  |  |  |  |
|  Distributable earnings | (1808374) | (1136947) | (2266829) | (1955493) |
|  **Total distributions** | **(1808374)** | **(1136947)** | **(2266829)** | **(1955493)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** |  |  |  |  |
|  Proceeds from shares issued | 57305777 | 54387819 | 37713363 | 115766022 |
|  Cost of shares redeemed | (53400212) | (13737728) | (21888788) | (63701888) |
|  **Net Increase (Decrease) from Capital Transactions** | **3905565** | **40650091** | **15824575** | **52064134** |
|  **Total Increase (Decrease) in Net Assets** | **(17125409)** | **72632809** | **(19662819)** | **102591174** |
|  **NET ASSETS** |  |  |  |  |
|  Beginning of Period | $144475249 | $71842440 | $191642745 | $89051571 |
|  **End of Period** | $**127349840** | $**144475249** | $**171979926** | $**191642745** |
|  **SHARE TRANSACTIONS** |  |  |  |  |
|  Beginning of period | 2875001 | 2025001 | 1700001 | 1125001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 1300000 | 1150000 | 350000 | 1200000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (1225000) | (300000) | (200000) | (625000) |
|  **Shares Outstanding, End of Period** | **2950001** | **2875001** | **1850001** | **1700001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

88 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global<br>ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global<br>ESG Select Index Fund | FlexShares<sup>®</sup> ESG & Climate US<br>Large Cap Core Index Fund | FlexShares<sup>®</sup> ESG & Climate US<br>Large Cap Core Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | September 20,<br>2021\*<br>through<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $2805170 | $2456041 | $162899 | $2838 |
|  Net realized gain (loss) | 3353319 | 13795248 | (133446) | (534) |
|  Net change in unrealized appreciation (depreciation) | (41798644) | 34498730 | (2180219) | 167182 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(35640155)** | **50750019** | **(2150766)** | **169486** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** |  |  |  |  |
|  Distributable earnings | (3114461) | (2324712) | (129697) |  |
|  **Total distributions** | **(3114461)** | **(2324712)** | **(129697)** | **—** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** |  |  |  |  |
|  Proceeds from shares issued | 14352429 | 53795593 | 24984332 |  |
|  Cost of shares redeemed | (14389810) | (27826718) | (3269970) |  |
|  **Net Increase (Decrease) from Capital Transactions** | **(37381)** | **25968875** | **21714362** | **—** |
|  **Total Increase (Decrease) in Net Assets** | **(38791997)** | **74394182** | **19433899** | **169486** |
|  **NET ASSETS** |  |  |  |  |
|  Beginning of Period | $185717474 | $111323292 | $2669486 | $2500000<sup>(2)</sup> |
|  **End of Period** | $**146925477** | $**185717474** | $**22103385** | $**2669486** |
|  **SHARE TRANSACTIONS** |  |  |  |  |
|  Beginning of period | 1250001 | 1050001 | 50000 | 50000<sup>(2)</sup> |
|  Shares issued | 50000 |  |  |  |
|  Shares issued in-kind | 50000 | 400000 | 525000 |  |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (100000) | (200000) | (75000) |  |
|  **Shares Outstanding, End of Period** | **1250001** | **1250001** | **500000** | **50000** |

---

*\** *Commencement of investment operations.* 

*(1)* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*(2)* *Amount includes the initial subscription.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 89

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##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate<br>Developed Markets ex-US Core<br>Index Fund | FlexShares<sup>®</sup> ESG & Climate<br>Developed Markets ex-US Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Emerging<br>Markets Core<br>Index Fund |
|  | Year Ended<br>October 31,<br>2022 | September 20,<br>2021\*<br> through<br>October 31,<br>2021 | April 20, 2022\*<br>through<br>October 31,<br>2022 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $441657 | $15775 | $75840 |
|  Net realized gain (loss) | (966117) | (777) | (45285) |
|  Net change in unrealized appreciation (depreciation) | (3597163) | 103891 | (1106532) |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |
|  **Resulting from Operations** | **(4121623)** | **118889** | **(1075977)** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (406987) |  | (65664) |
|  **Total distributions** | **(406987)** | **—** | **(65664)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 16578470 |  |  |
|  Cost of shares redeemed |  |  |  |
|  **Net Increase (Decrease) from Capital Transactions** | **16578470** | **—** | **—** |
|  **Total Increase (Decrease) in Net Assets** | **12049860** | **118889** | **(1141641)** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $5119060 | $5000171<sup>(2)</sup> | $5009376<sup>(2),(3)</sup> |
|  **End of Period** | $**17168920** | $**5119060** | $**3867735** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 100000 | 100000<sup>(2)</sup> | 100000<sup>(2)</sup> |
|  Shares issued |  |  |  |
|  Shares issued in-kind | 350000 |  |  |
|  Shares redeemed |  |  |  |
|  Shares redeemed in-kind |  |  |  |
|  **Shares Outstanding, End of Period** | **450000** | **100000** | **100000** |

---

*\** *Commencement of investment operations.* 

*(1)* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*(2)* *Amount includes the initial subscription.* 

*(3)* *Includes amounts paid in capital from the Authorized Participant in addition to the order's original cash component. This amount is made to offset taxes, commissions, and price differences from the NAV that would otherwise impact the fund on these order trades.* 

*See Accompanying Notes to the Financial Statements.* 

90 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar<br>Global<br>Upstream Natural Resources<br>Index Fund | FlexShares<sup>®</sup> Morningstar<br>Global<br>Upstream Natural Resources<br>Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global<br>Broad Infrastructure Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global<br>Broad Infrastructure Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $326558353 | $188997153 | $64519296 | $61807665 |
|  Net realized gain (loss) | 543920180 | (71904345) | (34284707) | 117716133 |
|  Net change in unrealized appreciation (depreciation) | (257516529) | 1409046021 | (413573085) | 271965150 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **612962004** | **1526138829** | **(383338496)** | **451488948** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (349767759) | (167354837) | (71164043) | (58905802) |
|  **Total distributions** | **(349767759)** | **(167354837)** | **(71164043)** | **(58905802)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 2228186786 | 1894646901 | 376096311 | 754964371 |
|  Cost of shares redeemed | (1709239303) | (125446435) | (64981425) | (360237628) |
|  **Net Increase (Decrease) from Capital Transactions** | **518947483** | **1769200466** | **311114886** | **394726743** |
|  **Total Increase (Decrease) in Net Assets** | **782141728** | **3127984458** | **(143387653)** | **787309889** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $6052710266 | $2924725808 | $2643906066 | $1856596177 |
|  **End of Period** | $**6834851994** | $**6052710266** | $**2500518413** | $**2643906066** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 156550001 | 109500001 | 45800001 | 38600001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 51400000 | 50850000 | 7100000 | 13350000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (42650000) | (3800000) | (1150000) | (6150000) |
|  **Shares Outstanding, End of Period** | **165300001** | **156550001** | **51750001** | **45800001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 91

------

##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Global Quality<br>Real Estate Index Fund | FlexShares<sup>®</sup> Global Quality<br>Real Estate Index Fund | FlexShares<sup>®</sup> Real Assets<br>Allocation Index Fund | FlexShares<sup>®</sup> Real Assets<br>Allocation Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $10527149 | $7422552 | $1052524 | $379252 |
|  Net realized gain (loss) | (1205777) | 10254699 | (347185) | 233987 |
|  Net change in unrealized appreciation (depreciation) | (112605358) | 91009496 | (6504289) | 1551258 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(103283986)** | **108686747** | **(5798950)** | **2164497** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (12433295) | (5654125) | (1056448) | (383940) |
|  Tax return of capital | (212283) |  |  |  |
|  **Total distributions** | **(12645578)** | **(5654125)** | **(1056448)** | **(383940)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 61391019 | 74006928 | 31091126 | 24868156 |
|  Cost of shares redeemed | (35678157) | (23016532) | (25670798) | (850756) |
|  **Net Increase (Decrease) from Capital Transactions** | **25712862** | **50990396** | **5420328** | **24017400** |
|  **Total Increase (Decrease) in Net Assets** | **(90216702)** | **154023018** | **(1435070)** | **25797957** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $418597383 | $264574365 | $30299686 | $4501729 |
|  **End of Period** | $**328380681** | $**418597383** | $**28864616** | $**30299686** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 5950001 | 5200001 | 900001 | 175001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 900000 | 1150000 | 925000 | 750000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (550000) | (400000) | (825000) | (25000) |
|  **Shares Outstanding, End of Period** | **6300001** | **5950001** | **1000001** | **900001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

92 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Quality Dividend<br>Index Fund | FlexShares<sup>®</sup> Quality Dividend<br>Index Fund | FlexShares<sup>®</sup> Quality<br>Dividend<br>Defensive Index Fund | FlexShares<sup>®</sup> Quality<br>Dividend<br>Defensive Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $36130232 | $32968130 | $8686945 | $9828754 |
|  Net realized gain (loss) | 74523974 | 155267183 | 35613228 | 61643521 |
|  Net change in unrealized appreciation (depreciation) | (248957784) | 267516624 | (74967194) | 63438797 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(138303578)** | **455751937** | **(30667021)** | **134911072** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (36901147) | (31171462) | (9019363) | (9806498) |
|  **Total distributions** | **(36901147)** | **(31171462)** | **(9019363)** | **(9806498)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 512092494 | 441818714 | 100491773 | 116279178 |
|  Cost of shares redeemed | (456702830) | (489030914) | (163419797) | (204498560) |
|  **Net Increase (Decrease) from Capital Transactions** | **55389664** | **(47212200)** | **(62928024)** | **(88219382)** |
|  **Total Increase (Decrease) in Net Assets** | **(119815061)** | **377368275** | **(102614408)** | **36885192** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $1642544880 | $1265176605 | $448057986 | $411172794 |
|  **End of Period** | $**1522729819** | $**1642544880** | $**345443578** | $**448057986** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 28150001 | 29150001 | 8000001 | 9650001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 9150000 | 8100000 | 1850000 | 2250000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (8175000) | (9100000) | (3025000) | (3900000) |
|  **Shares Outstanding, End of Period** | **29125001** | **28150001** | **6825001** | **8000001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 93

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Quality Dividend<br>Dynamic Index Fund | FlexShares<sup>®</sup> Quality Dividend<br>Dynamic Index Fund | FlexShares<sup>®</sup> International<br>Quality Dividend Index Fund | FlexShares<sup>®</sup> International<br>Quality Dividend Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $423411 | $404524 | $28081621 | $22006728 |
|  Net realized gain (loss) | 1388867 | 1782150 | (35389643) | 48065144 |
|  Net change in unrealized appreciation (depreciation) | (3871099) | 4139378 | (140731898) | 73816552 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(2058821)** | **6326052** | **(148039920)** | **143888424** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (436719) | (369573) | (29536094) | (20693535) |
|  **Total distributions** | **(436719)** | **(369573)** | **(29536094)** | **(20693535)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 5957686 | 5862851 | 30204474 | 60426090 |
|  Cost of shares redeemed | (7304687) | (3095145) | (36538271) | (21090657) |
|  **Net Increase (Decrease) from Capital Transactions** | **(1347001)** | **2767706** | **(6333797)** | **39335433** |
|  **Total Increase (Decrease) in Net Assets** | **(3842541)** | **8724185** | **(183909811)** | **162530322** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $21905004 | $13180819 | $616006903 | $453476581 |
|  **End of Period** | $**18062463** | $**21905004** | $**432097092** | $**616006903** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 350001 | 300001 | 23900001 | 22500001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 100000 | 100000 | 1200000 | 2300000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (125000) | (50000) | (1700000) | (900000) |
|  **Shares Outstanding, End of Period** | **325001** | **350001** | **23400001** | **23900001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

94 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> International<br>Quality Dividend Defensive<br>Index Fund | FlexShares<sup>®</sup> International<br>Quality Dividend Defensive<br>Index Fund | FlexShares<sup>®</sup> International<br>Quality Dividend Dynamic<br>Index Fund | FlexShares<sup>®</sup> International<br>Quality Dividend Dynamic<br>Index Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $2830675 | $2799484 | $4143080 | $2288529 |
|  Net realized gain (loss) | (4890674) | 5928070 | (6336149) | 1919295 |
|  Net change in unrealized appreciation (depreciation) | (12707606) | 8195139 | (19667897) | 5806232 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(14767605)** | **16922693** | **(21860966)** | **10014056** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (2940092) | (2683528) | (4368329) | (1876931) |
|  **Total distributions** | **(2940092)** | **(2683528)** | **(4368329)** | **(1876931)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued |  |  | 14075676 | 45461250 |
|  Cost of shares redeemed | (13205553) | (2184308) | (2032721) |  |
|  **Net Increase (Decrease) from Capital Transactions** | **(13205553)** | **(2184308)** | **12042955** | **45461250** |
|  **Total Increase (Decrease) in Net Assets** | **(30913250)** | **12054857** | **(14186340)** | **53598375** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $71458591 | $59403734 | $75974697 | $22376322 |
|  **End of Period** | $**40545341** | $**71458591** | $**61788357** | $**75974697** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 3000001 | 3100001 | 2500001 | 1000001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind |  |  | 500000 | 1500000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (700000) | (100000) | (100000) |  |
|  **Shares Outstanding, End of Period** | **2300001** | **3000001** | **2900001** | **2500001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 95

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> iBoxx 3-Year<br>Target Duration TIPS Index<br>Fund | FlexShares<sup>®</sup> iBoxx 3-Year<br>Target Duration TIPS Index<br>Fund | FlexShares<sup>®</sup> iBoxx 5-Year<br>Target Duration TIPS Index<br>Fund | FlexShares<sup>®</sup> iBoxx 5-Year<br>Target Duration TIPS Index<br>Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $129946912 | $58365045 | $52412741 | $26012110 |
|  Net realized gain (loss) | (61202821) | 36821507 | (23575612) | 12575174 |
|  Net change in unrealized appreciation (depreciation) | (171934382) | (1328792) | (102258738) | 2282079 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(103190291)** | **93857760** | **(73421609)** | **40869363** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (131367411) | (61292947) | (53319431) | (26674665) |
|  Tax return of capital | (2470987) |  | (769089) |  |
|  **Total distributions** | **(133838398)** | **(61292947)** | **(54088520)** | **(26674665)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 1154710930 | 302448698 | 259127932 | 155885058 |
|  Cost of shares redeemed | (197328045) | (326919699) | (202210614) | (51695657) |
|  **Net Increase (Decrease) from Capital Transactions** | **957382885** | **(24471001)** | **56917318** | **104189401** |
|  **Total Increase (Decrease) in Net Assets** | **720354196** | **8093812** | **(70592811)** | **118384099** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $1437584419 | $1429490607 | $714479309 | $596095210 |
|  **End of Period** | $**2157938615** | $**1437584419** | $**643886498** | $**714479309** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 54504000 | 55554000 | 25500001 | 21800001 |
|  Shares issued |  |  |  |  |
|  Shares issued in-kind | 45050000 | 11450000 | 9600000 | 5550000 |
|  Shares redeemed |  |  |  |  |
|  Shares redeemed in-kind | (8050000) | (12500000) | (7850000) | (1850000) |
|  **Shares Outstanding, End of Period** | **91504000** | **54504000** | **27250001** | **25500001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

96 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Disciplined<br>Duration MBS Index Fund | FlexShares<sup>®</sup> Disciplined<br>Duration MBS Index Fund | FlexShares<sup>®</sup> Credit-Scored<br>US Corporate Bond Index<br>Fund | FlexShares<sup>®</sup> Credit-Scored<br>US Corporate Bond Index<br>Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $1315458 | $381266 | $5647170 | $4833547 |
|  Net realized gain (loss) | (4182658) | 1283596 | (11524528) | 3014355 |
|  Net change in unrealized appreciation (depreciation) | (11405968) | (2030761) | (31515973) | (6321483) |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(14273168)** | **(365899)** | **(37393331)** | **1526419** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (2906209) | (2676548) | (8289209) | (7983218) |
|  **Total distributions** | **(2906209)** | **(2676548)** | **(8289209)** | **(7983218)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 24467825 | 19053611 | 54188645 | 133299728 |
|  Cost of shares redeemed | (21342283) | (4788861) | (82107127) | (13500359) |
|  **Net Increase (Decrease) from Capital Transactions** | **3125542** | **14264750** | **(27918482)** | **119799369** |
|  **Total Increase (Decrease) in Net Assets** | **(14053835)** | **11222303** | **(73601022)** | **113342570** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $111242788 | $100020485 | $315739979 | $202397409 |
|  **End of Period** | $**97188953** | $**111242788** | $**242138957** | $**315739979** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 4750001 | 4150001 | 5900001 | 3700001 |
|  Shares issued | 1100000 | 800000 | 950000 | 2250000 |
|  Shares issued in-kind |  |  | 150000 | 200000 |
|  Shares redeemed | (1000000) | (200000) | (1500000) |  |
|  Shares redeemed in-kind |  |  | (150000) | (250000) |
|  **Shares Outstanding, End of Period** | **4850001** | **4750001** | **5350001** | **5900001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 97

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Credit-Scored<br>US Long Corporate Bond Index<br>Fund | FlexShares<sup>®</sup> Credit-Scored<br>US Long Corporate Bond Index<br>Fund | FlexShares<sup>®</sup> High Yield<br>Value-Scored Bond Index<br>Fund | FlexShares<sup>®</sup> High Yield<br>Value-Scored Bond Index<br>Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $1897648 | $1701113 | $54264979 | $15485875 |
|  Net realized gain (loss) | (5104776) | 1029123 | (84823660) | 9388965 |
|  Net change in unrealized appreciation (depreciation) | (14928195) | (16024) | (89845656) | 1852410 |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(18135323)** | **2714212** | **(120404337)** | **26727250** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (2837455) | (3440094) | (56016563) | (14752663) |
|  **Total distributions** | **(2837455)** | **(3440094)** | **(56016563)** | **(14752663)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued |  | 27084379 | 746832545 | 415533944 |
|  Cost of shares redeemed | (4384065) | (11864331) | (257649977) | (41947766) |
|  **Net Increase (Decrease) from Capital Transactions** | **(4384065)** | **15220048** | **489182568** | **373586178** |
|  **Total Increase (Decrease) in Net Assets** | **(25356843)** | **14494166** | **312761668** | **385560765** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $60854577 | $46360411 | $575183700 | $189622935 |
|  **End of Period** | $**35497734** | $**60854577** | $**887945368** | $**575183700** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 1000001 | 750001 | 11600001 | 4100001 |
|  Shares issued |  | 450000 | 14850000 | 7200000 |
|  Shares issued in-kind |  |  | 1700000 | 1150000 |
|  Shares redeemed | (100000) | (200000) | (5500000) | (850000) |
|  Shares redeemed in-kind |  |  | (500000) |  |
|  **Shares Outstanding, End of Period** | **900001** | **1000001** | **22150001** | **11600001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

98 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup><br>ESG & Climate<br>High Yield<br>Corporate<br>Core Index<br>Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>High Yield<br>Corporate<br>Core Index<br>Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Investment Grade<br>Corporate Core<br>Index Fund | FlexShares<sup>®</sup><br>ESG & Climate<br>Investment Grade<br>Corporate Core<br>Index Fund |
|  | Year Ended<br>October 31,<br>2022 | September 20,<br>2021\*<br>through<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | September 20,<br>2021\*<br>through<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $1006867 | $208614 | $1023293 | $102578 |
|  Net realized gain (loss) | (3622569) | (16194) | (5269138) | (68270) |
|  Net change in unrealized appreciation (depreciation) | 171352 | (409765) | (4417178) | (682569) |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(2444350)** | **(217345)** | **(8663023)** | **(648261)** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (1310115) |  | (1093741) |  |
|  **Total distributions** | **(1310115)** | **—** | **(1093741)** | **—** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 20983032 |  | 6485716 |  |
|  Cost of shares redeemed | (46563361) |  | (22920483) |  |
|  **Net Increase (Decrease) from Capital Transactions** | **(25580329)** | **—** | **(16434767)** | **—** |
|  **Total Increase (Decrease) in Net Assets** | **(29334794)** | **(217345)** | **(26191531)** | **(648261)** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $49766635 | $49983980<sup>(2),(3)</sup> | $49347056 | $49995317<sup>(2),(3)</sup> |
|  **End of Period** | $**20431841** | $**49766635** | $**23155525** | $**49347056** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 1000000 | 1000000<sup>(2)</sup> | 1000000 | 1000000<sup>(2)</sup> |
|  Shares issued | 500000 |  | 150000 |  |
|  Shares issued in-kind |  |  |  |  |
|  Shares redeemed | (800000) |  | (550000) |  |
|  Shares redeemed in-kind | (200000) |  |  |  |
|  **Shares Outstanding, End of Period** | **500000** | **1000000** | **600000** | **1000000** |

---

*\** *Commencement of investment operations* 

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*<sup>(2)</sup>* *Amount includes the initial subscription.* 

*<sup>(3)</sup>* *Includes amounts paid in capital from the Authorized Participant in addition to the order's original cash component. This amount is made to offset taxes, commissions, and price differences from the NAV that would otherwise impact the fund on these order trades* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 99

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##### [**Table of Contents**](#toc)

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Statements of Changes in Net Assets (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Ready Access<br>Variable Income Fund | FlexShares<sup>®</sup> Ready Access<br>Variable Income Fund | FlexShares<sup>®</sup> Core Select<br>Bond Fund | FlexShares<sup>®</sup> Core Select<br>Bond Fund |
|  | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 | Year Ended<br>October 31,<br>2022 | Year Ended<br>October 31,<br>2021 |
|  **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  Net investment income (loss) | $8594946 | $2617948 | $3278852 | $1991134 |
|  Net realized gain (loss) | (815721) | 1261361 | (14903388) | 252759 |
|  Net change in unrealized appreciation (depreciation) | (11518881) | (2362864) | (13967521) | (1848559) |
|  **Net Increase (Decrease) in Net Assets** |  |  |  |  |
|  **Resulting from Operations** | **(3739656)** | **1516445** | **(25592057)** | **395334** |
|  **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
|  Distributable earnings | (7907561) | (3046370) | (3352156) | (2693092) |
|  **Total distributions** | **(7907561)** | **(3046370)** | **(3352156)** | **(2693092)** |
|  **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** | **CAPITAL TRANSACTIONS<sup>(1)</sup>** |
|  Proceeds from shares issued | 583737232 | 55265356 | 73291854 | 36362834 |
|  Cost of shares redeemed | (90072224) | (148597576) | (11502530) | (16671414) |
|  **Net Increase (Decrease) from Capital Transactions** | **493665008** | **(93332220)** | **61789324** | **19691420** |
|  **Total Increase (Decrease) in Net Assets** | **482017791** | **(94862145)** | **32845111** | **17393662** |
|  **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
|  Beginning of Period | $374339139 | $469201284 | $126516968 | $109123306 |
|  **End of Period** | $**856356930** | $**374339139** | $**159362079** | $**126516968** |
|  **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** | **SHARE TRANSACTIONS** |
|  Beginning of period | 4925001 | 6150001 | 4825001 | 4075001 |
|  Shares issued | 7800000 | 725000 |  |  |
|  Shares issued in-kind |  |  | 3075000 | 1375000 |
|  Shares redeemed | (1200000) | (1950000) |  |  |
|  Shares redeemed in-kind |  |  | (475000) | (625000) |
|  **Shares Outstanding, End of Period** | **11525001** | **4925001** | **7425001** | **4825001** |

---

*<sup>(1)</sup>* *Capital transactions may include transaction fees associated with creation and redemption transactions which occurred during the period. See Note 9 to the Financial Statements.* 

*See Accompanying Notes to the Financial Statements.* 

100 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## FlexShares<sup>®</sup> Trust

## Financial Highlights

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> US Quality Low Volatility Index Fund | FlexShares<sup>®</sup> US Quality Low Volatility Index Fund | FlexShares<sup>®</sup> US Quality Low Volatility Index Fund | FlexShares<sup>®</sup> US Quality Low Volatility Index Fund |
|  | Year ended<br> October 31,<br> 2022 | Year ended<br> October 31,<br> 2021 | Year ended<br> October 31,<br> 2020 | For the<br>period<br>07/15/19\*<br>through<br>10/31/19 |
|  **Net asset value, beginning of period** | $54.60 | $40.93 | $40.44 | $40.00 |
|  **PER SHARE** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.82 <sup>(a)</sup> | 0.57 <sup>(a)</sup> | 0.64 <sup>(a)</sup> | 0.17 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (4.70) | 13.69 | 0.38 | 0.35 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (3.88) | 14.26 | 1.02 | 0.52 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.70) | (0.59) | (0.53) | (0.08) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.70) | (0.59) | (0.53) | (0.08) |
|  **Net Asset Value, end of period** | $50.02 | $54.60 | $40.93 | $40.44 |
|  **Total Return<sup>(b)</sup>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (7.12)% | 35.05% | 2.63% | 1.30% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.23% | 0.23% | 0.23% | 0.23% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.22% | 0.22% | 0.22% | 0.22% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.58% | 1.17% | 1.55% | 1.45% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.58% | 1.17% | 1.56% | 1.45% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)</sup><sup>(e)</sup> | 48% | 43% | 47% | 9% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $162569 | $161074 | $110524 | $6067 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 101

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Developed Markets ex-US<br>Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Developed Markets ex-US<br>Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Developed Markets ex-US<br>Quality Low Volatility Index Fund | FlexShares<sup>®</sup> Developed Markets ex-US<br>Quality Low Volatility Index Fund |
|  | Year ended<br>October 31,<br> 2022 | Year ended<br>October 31,<br> 2021 | Year ended<br>October 31,<br> 2020 | For the<br>period<br>07/15/19\*<br>through<br>10/31/19 |
|  **Net asset value, beginning of period** | $27.92 | $23.48 | $25.60 | $25.00 |
|  **PER SHARE** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.66 <sup>(a)</sup> | 0.73 <sup>(a)</sup> | 0.64 <sup>(a)</sup> | 0.16 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (5.71) | 4.43 | (2.22) | 0.53 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (5.05) | 5.16 | (1.58) | 0.69 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.78) | (0.72) | (0.54) | (0.09) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.78) | (0.72) | (0.54) | (0.09) |
|  **Net Asset Value, end of period** | $22.09 | $27.92 | $23.48 | $25.60 |
|  **Total Return<sup>(b)</sup>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (18.36)% | 22.05% | (6.24)% | 2.76% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.33% | 0.33% | 0.33% | 0.32% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.32% | 0.32% | 0.32% | 0.32% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.60% | 2.68% | 2.63% | 2.21% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.60% | 2.68% | 2.64% | 2.21% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 56% | 56% | 62% | 14% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $61852 | $75371 | $65747 | $5120 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

102 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Emerging Markets Quality<br>Low Volatility Index Fund | FlexShares<sup>®</sup> Emerging Markets Quality<br>Low Volatility Index Fund | FlexShares<sup>®</sup> Emerging Markets Quality<br>Low Volatility Index Fund | FlexShares<sup>®</sup> Emerging Markets Quality<br>Low Volatility Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | For the<br>period<br>07/15/19\*<br>through<br>10/31/19 |
|  **Net asset value, beginning of period** | $26.41 | $23.95 | $24.94 | $25.00 |
|  **PER SHARE** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.67 <sup>(a)</sup> | 0.69 <sup>(a)</sup> | 0.56 <sup>(a)</sup> | 0.23 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (5.82) | 2.22 | (0.91) | (0.18) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (5.15) | 2.91 | (0.35) | 0.05 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.69) | (0.45) | (0.64) | (0.11) |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital | (0.04) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.73) | (0.45) | (0.64) | (0.11) |
|  **Net Asset Value, end of period** | $20.53 | $26.41 | $23.95 | $24.94 |
|  **Total Return<sup>(b)</sup>** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (19.77)% | 12.09% | (1.41)% | 0.19% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.41% | 0.41% | 0.41% | 0.40% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.40% | 0.40% | 0.40% | 0.40% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.75% | 2.57% | 2.38% | 3.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.75% | 2.58% | 2.39% | 3.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 53% | 54% | 81% | 12% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $8214 | $15844 | $9578 | $4989 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 103

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $178.97 | $121.11 | $119.52 | $110.13 | $107.50 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 2.39 <sup>(a)</sup> | 2.08 <sup>(a)</sup> | 2.10 <sup>(a)</sup> | 1.95 <sup>(a)</sup> | 2.02 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (27.93) | 57.80 | 1.60 | 9.33 | 2.59 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (25.54) | 59.88 | 3.70 | 11.28 | 4.61 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.36) | (2.02) | (2.11) | (1.89) | (1.98) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.36) | (2.02) | (2.11) | (1.89) | (1.98) |
|  **Net Asset Value, end of period** | $151.07 | $178.97 | $121.11 | $119.52 | $110.13 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (14.33)% | 49.68% | 3.28% | 10.41% | 4.22% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.26% | 0.26% | 0.26% | 0.26% | 0.25% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.25% | 0.25% | 0.25% | 0.25% | 0.25% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.47% | 1.28% | 1.78% | 1.72% | 1.77% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.47% | 1.29% | 1.79% | 1.72% | 1.77% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 14% | 24% | 26% | 28% | 15% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $1397408 | $1727019 | $1174786 | $1446137 | $1387665 |

---

*See Accompanying Notes to the Financial Statements.* 

104 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $73.71 | $54.24 | $62.67 | $59.76 | $67.51 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.94 <sup>(a)</sup> | 1.71 <sup>(a)</sup> | 1.31 <sup>(a)</sup> | 1.85 <sup>(a)</sup> | 1.78 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (18.44) | 19.27 | (7.88) | 2.89 | (7.39) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (16.50) | 20.98 | (6.57) | 4.74 | (5.61) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.61) | (1.51) | (1.86) | (1.83) | (2.14) |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital | (0.12) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.73) | (1.51) | (1.86) | (1.83) | (2.14) |
|  **Net Asset Value, end of period** | $54.48 | $73.71 | $54.24 | $62.67 | $59.76 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (22.83)% | 38.79% | (10.57)% | 8.13% | (8.61)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.40% | 0.40% | 0.40% | 0.40% | 0.39% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.39% | 0.39% | 0.39% | 0.39% | 0.39% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 3.02% | 2.42% | 2.28% | 3.09% | 2.65% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 3.02% | 2.42% | 2.28% | 3.09% | 2.65% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 27% | 29% | 21% | 25% | 34% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $446754 | $648638 | $499016 | $965142 | $968096 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 105

------

##### [**Table of Contents**](#toc)

------

Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund | FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $60.79 | $48.05 | $50.42 | $47.92 | $57.38 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.86 <sup>(a)</sup> | 1.51 <sup>(a)</sup> | 1.02 <sup>(a)</sup> | 1.49 <sup>(a)</sup> | 1.46 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (18.06) | 12.40 | (1.97) | 2.46 | (9.34) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (16.20) | 13.91 | (0.95) | 3.95 | (7.88) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.37) | (1.17) | (1.42) | (1.45) | (1.58) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.37) | (1.17) | (1.42) | (1.45) | (1.58) |
|  **Net Asset Value, end of period** | $42.22 | $60.79 | $48.05 | $50.42 | $47.92 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (27.32)% | 28.95% | (1.86)% | 8.29% | (14.05)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.60% | 0.60% | 0.60% | 0.60% | 0.59% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.59% | 0.59% | 0.59% | 0.59% | 0.59% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 3.49% | 2.46% | 2.13% | 2.92% | 2.56% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 3.49% | 2.47% | 2.14% | 2.93% | 2.56% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 34% | 40% | 41% | 45% | 49% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $206889 | $334372 | $225847 | $413414 | $488736 |

---

*See Accompanying Notes to the Financial Statements.* 

106 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> US Quality Large Cap Index Fund | FlexShares<sup>®</sup> US Quality Large Cap Index Fund | FlexShares<sup>®</sup> US Quality Large Cap Index Fund | FlexShares<sup>®</sup> US Quality Large Cap Index Fund | FlexShares<sup>®</sup> US Quality Large Cap Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $50.25 | $35.48 | $34.69 | $33.44 | $31.83 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.61 <sup>(a)</sup> | 0.50 <sup>(a)</sup> | 0.62 <sup>(a)</sup> | 0.68 <sup>(a)</sup> | 0.54 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (7.11) | 14.76 | 0.76 | 1.29 | 1.58 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (6.50) | 15.26 | 1.38 | 1.97 | 2.12 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.58) | (0.49) | (0.59) | (0.72) | (0.51) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.58) | (0.49) | (0.59) | (0.72) | (0.51) |
|  **Net Asset Value, end of period** | $43.17 | $50.25 | $35.48 | $34.69 | $33.44 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (12.98)% | 43.21% | 4.13% | 6.04% | 6.63% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.30% | 0.33% | 0.33% | 0.33% | 0.33% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.30% | 0.32% | 0.32% | 0.32% | 0.32% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.31% | 1.11% | 1.77% | 2.04% | 1.56% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.31% | 1.11% | 1.77% | 2.05% | 1.57% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 22% | 30% | 48% | 69% | 94% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $127350 | $144475 | $71842 | $51171 | $61859 |

---

*See Accompanying Notes to the Financial Statements.* 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $112.73 | $79.16 | $72.29 | $64.33 | $60.49 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.22 <sup>(a)</sup> | 1.26 <sup>(a)</sup> | 1.27 <sup>(a)</sup> | 1.21 <sup>(a)</sup> | 1.09 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (19.75) | 33.50 | 6.81 | 7.83 | 3.84 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (18.53) | 34.76 | 8.08 | 9.04 | 4.93 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.24) | (1.19) | (1.21) | (1.08) | (1.09) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.24) | (1.19) | (1.21) | (1.08) | (1.09) |
|  **Net Asset Value, end of period** | $92.96 | $112.73 | $79.16 | $72.29 | $64.33 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (16.51)% | 44.15% | 11.40% | 14.21% | 8.13% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.33% | 0.33% | 0.33% | 0.33% | 0.33% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.32% | 0.32% | 0.32% | 0.32% | 0.32% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.20% | 1.25% | 1.67% | 1.78% | 1.66% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.20% | 1.26% | 1.68% | 1.79% | 1.67% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 46% | 40% | 66% | 75% | 110% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $171980 | $191643 | $89052 | $56024 | $28946 |

---

*See Accompanying Notes to the Financial Statements.* 

108 FLEXSHARES ANNUAL REPORT

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $148.57 | $106.02 | $101.77 | $91.61 | $91.97 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 2.24 <sup>(a)</sup> | 2.03 <sup>(a)</sup> | 1.72 <sup>(a)</sup> | 2.05 <sup>(a)</sup> | 1.95 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (30.82) | 42.38 | 4.26 | 10.12 | (0.61) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (28.58) | 44.41 | 5.98 | 12.17 | 1.34 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.45) | (1.86) | (1.73) | (2.01) | (1.70) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.45) | (1.86) | (1.73) | (2.01) | (1.70) |
|  **Net Asset Value, end of period** | $117.54 | $148.57 | $106.02 | $101.77 | $91.61 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (19.35)% | 42.10% | 6.03% | 13.49% | 1.38% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.43% | 0.43% | 0.43% | 0.43% | 0.43% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.42% | 0.42% | 0.42% | 0.42% | 0.42% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.69% | 1.50% | 1.66% | 2.15% | 2.03% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.69% | 1.51% | 1.66% | 2.16% | 2.04% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 54% | 48% | 58% | 66% | 78% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $146925 | $185717 | $111323 | $91590 | $73284 |

---

*See Accompanying Notes to the Financial Statements.* 

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| | | |
|:---|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate<br>US Large Cap Core Index<br>Fund | FlexShares<sup>®</sup> ESG & Climate<br>US Large Cap Core Index<br>Fund |
|  | Year ended<br>October 31,<br>2022 | For the<br>period<br>09/20/21\*<br>through<br>10/31/21 |
|  **Net asset value, beginning of period** | $53.39 | $50.00 |
|  **PER SHARE** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.70 <sup>(a)</sup> | 0.06 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (9.25) | 3.33 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (8.55) | 3.39 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.62) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains | (0.01) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.63) |  |
|  **Net Asset Value, end of period** | $44.21 | $53.39 |
|  **Total Return<sup>(b)</sup>** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (16.09)% | 6.78% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.10% | 0.09% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.09% | 0.09% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.53% | 0.96% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.53% | 0.96% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 18% | — %<sup>(f)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $22103 | $2669 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

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| | | |
|:---|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate<br>Developed Markets ex-US<br>Core Index Fund | FlexShares<sup>®</sup> ESG & Climate<br>Developed Markets ex-US<br>Core Index Fund |
|  | Year ended<br>October 31,<br>2022 | For the<br>period<br>09/20/21\*<br>through<br>10/31/21 |
|  **Net asset value, beginning of period** | $51.19 | $50.00 |
|  **PER SHARE** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.44 <sup>(a)</sup> | 0.16 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (13.28) | 1.03 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (11.84) | 1.19 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.20) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.20) |  |
|  **Net Asset Value, end of period** | $38.15 | $51.19 |
|  **Total Return<sup>(b)</sup>** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (23.36)% | 2.38% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.13% | 0.12% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.12% | 0.12% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 3.35% | 2.72% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 3.35% | 2.72% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 33% | — %<sup>(f)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $17169 | $5119 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

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| | |
|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate<br>Emerging Markets Core Index Fund |
|  | For the<br> period<br> 04/20/22\*<br> through<br> 10/31/22 |
|  **Net asset value, beginning of period** | $50.00 |
|  **PER SHARE** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.76 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (11.42) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (10.66) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.66) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.66) |
|  **Net Asset Value, end of period** | $38.68 |
|  **Total Return<sup>(b)</sup>** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (21.47)% |
|  **RATIOS/SUPPLEMENT DATA** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.19% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 3.15% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 3.15% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $3868 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

112 FLEXSHARES ANNUAL REPORT

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund | FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund | FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund | FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund | FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $38.66 | $26.71 | $31.40 | $31.51 | $31.59 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.88 <sup>(a)</sup> | 1.44 <sup>(a)</sup> | 0.89 <sup>(a)</sup> | 1.08 <sup>(a)</sup> | 0.91 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | 2.76 | 11.72 | (4.65) | (0.09) | (0.13) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | 4.64 | 13.16 | (3.76) | 0.99 | 0.78 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.95) | (1.21) | (0.93) | (1.10) | (0.86) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.95) | (1.21) | (0.93) | (1.10) | (0.86) |
|  **Net Asset Value, end of period** | $41.35 | $38.66 | $26.71 | $31.40 | $31.51 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | 12.20% | 49.70% | (11.87)% | 3.16% | 2.33% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.47% | 0.47% | 0.47% | 0.47% | 0.46% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.46% | 0.46% | 0.46% | 0.46% | 0.46% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 4.48% | 3.95% | 3.03% | 3.40% | 2.72% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 4.48% | 3.95% | 3.04% | 3.41% | 2.72% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 32% | 28% | 29% | 24% | 30% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $6834852 | $6052710 | $2924726 | $5510201 | $5435783 |

---

*See Accompanying Notes to the Financial Statements.* 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $57.73 | $48.10 | $52.56 | $45.09 | $47.85 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.35 <sup>(a)</sup> | 1.38 <sup>(a)</sup> | 1.25 <sup>(a)</sup> | 1.35 <sup>(a)</sup> | 1.36 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (9.27) | 9.57 | (4.53) | 7.34 | (2.71) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (7.92) | 10.95 | (3.28) | 8.69 | (1.35) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.49) | (1.32) | (1.18) | (1.22) | (1.41) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.49) | (1.32) | (1.18) | (1.22) | (1.41) |
|  **Net Asset Value, end of period** | $48.32 | $57.73 | $48.10 | $52.56 | $45.09 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (13.92)% | 22.85% | (6.23)% | 19.52% | (2.90)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.48% | 0.48% | 0.48% | 0.48% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.47% | 0.47% | 0.47% | 0.47% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.51% | 2.45% | 2.51% | 2.73% | 2.88% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.51% | 2.45% | 2.52% | 2.74% | 2.89% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 16% | 13% | 13% | 12% | 13% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $2500518 | $2643906 | $1856596 | $1477030 | $773363 |

---

*See Accompanying Notes to the Financial Statements.* 

114 FLEXSHARES ANNUAL REPORT

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | FlexShares<sup>®</sup> Global Quality Real Estate Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31,<br>2018 |
|  **Net asset value, beginning of period** | $70.35 | $50.88 | $66.60 | $57.96 | $62.02 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.67 <sup>(a)</sup> | 1.38 <sup>(a)</sup> | 1.43 <sup>(a)</sup> | 1.76 <sup>(a)</sup> | 1.80 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (17.88) | 19.13 | (14.62) | 8.68 | (3.99) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (16.21) | 20.51 | (13.19) | 10.44 | (2.19) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.99) | (1.04) | (2.50) | (1.80) | (1.87) |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital | (0.03) |  | (0.03) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.02) | (1.04) | (2.53) | (1.80) | (1.87) |
|  **Net Asset Value, end of period** | $52.12 | $70.35 | $50.88 | $66.60 | $57.96 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (23.51)% | 40.58% | (20.29)% | 18.37% | (3.69)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.46% | 0.46% | 0.46% | 0.46% | 0.46% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.45% | 0.45% | 0.45% | 0.45% | 0.45% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.63% | 2.16% | 2.53% | 2.80% | 2.92% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.63% | 2.17% | 2.54% | 2.81% | 2.92% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 54% | 52% | 56% | 53% | 61% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $328381 | $418597 | $264574 | $376264 | $275332 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 115

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Real Assets Allocation Index Fund | FlexShares<sup>®</sup> Real Assets Allocation Index Fund | FlexShares<sup>®</sup> Real Assets Allocation Index Fund | FlexShares<sup>®</sup> Real Assets Allocation Index Fund | FlexShares<sup>®</sup> Real Assets Allocation Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $33.67 | $25.72 | $30.30 | $26.45 | $28.08 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.93 <sup>(a)</sup> | 0.83 <sup>(a)</sup> | 0.86 <sup>(a)</sup> | 0.76 <sup>(a)</sup> | 0.80 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (4.72) | 7.78 | (4.58) | 3.85 | (1.64) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (3.79) | 8.61 | (3.72) | 4.61 | (0.84) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.02) | (0.66) | (0.86) | (0.76) | (0.79) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains |  |  |  |  | 0.00 <sup>(g)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.02) | (0.66) | (0.86) | (0.76) | (0.79) |
|  **Net Asset Value, end of period** | $28.86 | $33.67 | $25.72 | $30.30 | $26.45 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (11.49)% | 33.66% | (12.45)% | 17.69% | (3.09)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.58 %<sup>(h)</sup> | 0.58 %<sup>(h)</sup> | 0.58 %<sup>(h)</sup> | 0.58 %<sup>(h)</sup> | 0.59 %<sup>(h)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.11 %<sup>(h)</sup> | 0.12 %<sup>(h)</sup> | 0.11 %<sup>(h)</sup> | 0.11 %<sup>(h)</sup> | 0.11 %<sup>(h)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.40% | 2.07% | 2.65% | 2.22% | 2.39% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.86% | 2.53% | 3.11% | 2.69% | 2.87% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 7% | 40% | 14% | 4% | 5% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $28865 | $30300 | $4502 | $11361 | $13887 |

---

*See Accompanying Notes to the Financial Statements.* 

116 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Quality Dividend Index Fund | FlexShares<sup>®</sup> Quality Dividend Index Fund | FlexShares<sup>®</sup> Quality Dividend Index Fund | FlexShares<sup>®</sup> Quality Dividend Index Fund | FlexShares<sup>®</sup> Quality Dividend Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $58.35 | $43.40 | $46.33 | $44.53 | $42.57 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.25 <sup>(a)</sup> | 1.16 <sup>(a)</sup> | 1.24 <sup>(a)</sup> | 1.24 <sup>(a)</sup> | 1.20 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (6.05) | 14.89 | (2.67) | 2.29 | 1.98 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (4.80) | 16.05 | (1.43) | 3.53 | 3.18 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.27) | (1.10) | (1.25) | (1.19) | (1.22) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains |  |  | (0.25) | (0.54) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.27) | (1.10) | (1.50) | (1.73) | (1.22) |
|  **Net Asset Value, end of period** | $52.28 | $58.35 | $43.40 | $46.33 | $44.53 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (8.29)% | 37.27% | (2.98)% | 8.45% | 7.42% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.38% | 0.38% | 0.38% | 0.38% | 0.37% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.37% | 0.37% | 0.37% | 0.37% | 0.37% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.24% | 2.16% | 2.79% | 2.80% | 2.64% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.24% | 2.16% | 2.79% | 2.81% | 2.64% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 40% | 51% | 75% | 95% | 76% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $1522730 | $1642545 | $1265177 | $1707344 | $1759108 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 117

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $56.01 | $42.61 | $46.25 | $44.46 | $42.04 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.16 <sup>(a)</sup> | 1.09 <sup>(a)</sup> | 1.21 <sup>(a)</sup> | 1.22 <sup>(a)</sup> | 1.21 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (5.35) | 13.39 | (3.28) | 3.35 | 2.45 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (4.19) | 14.48 | (2.07) | 4.57 | 3.66 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.21) | (1.08) | (1.21) | (1.14) | (1.24) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains |  |  | (0.36) | (1.64) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.21) | (1.08) | (1.57) | (2.78) | (1.24) |
|  **Net Asset Value, end of period** | $50.61 | $56.01 | $42.61 | $46.25 | $44.46 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (7.53)% | 34.28% | (4.45)% | 11.40% | 8.69% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.38% | 0.38% | 0.38% | 0.38% | 0.38% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.37% | 0.37% | 0.37% | 0.37% | 0.37% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.16% | 2.10% | 2.77% | 2.76% | 2.70% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.16% | 2.11% | 2.77% | 2.76% | 2.71% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 47% | 57% | 76% | 91% | 94% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $345444 | $448058 | $411173 | $450963 | $320091 |

---

*See Accompanying Notes to the Financial Statements.* 

118 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $62.59 | $43.94 | $45.49 | $42.20 | $41.84 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.23 <sup>(a)</sup> | 1.22 <sup>(a)</sup> | 1.33 <sup>(a)</sup> | 1.21 <sup>(a)</sup> | 1.15 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (6.97) | 18.57 | (1.21) | 3.26 | 0.40 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (5.74) | 19.79 | 0.12 | 4.47 | 1.55 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.27) | (1.14) | (1.67) | (1.18) | (1.19) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.27) | (1.14) | (1.67) | (1.18) | (1.19) |
|  **Net Asset Value, end of period** | $55.58 | $62.59 | $43.94 | $45.49 | $42.20 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (9.23)% | 45.38% | 0.86% | 10.86% | 3.59% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.38% | 0.38% | 0.38% | 0.38% | 0.38% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.37% | 0.37% | 0.37% | 0.37% | 0.37% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.07% | 2.14% | 2.93% | 2.81% | 2.61% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.08% | 2.15% | 2.94% | 2.82% | 2.62% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 48% | 53% | 77% | 77% | 77% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $18062 | $21905 | $13181 | $52308 | $44305 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 119

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> International Quality Dividend Index Fund | FlexShares<sup>®</sup> International Quality Dividend Index Fund | FlexShares<sup>®</sup> International Quality Dividend Index Fund | FlexShares<sup>®</sup> International Quality Dividend Index Fund | FlexShares<sup>®</sup> International Quality Dividend Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $25.77 | $20.15 | $23.06 | $22.37 | $26.27 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.15 <sup>(a)</sup> | 0.97 <sup>(a)</sup> | 0.79 <sup>(a)</sup> | 1.13 <sup>(a)</sup> | 1.22 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (7.23) | 5.55 | (2.86) | 0.70 | (3.86) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (6.08) | 6.52 | (2.07) | 1.83 | (2.64) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.22) | (0.90) | (0.84) | (1.14) | (1.26) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.22) | (0.90) | (0.84) | (1.14) | (1.26) |
|  **Net Asset Value, end of period** | $18.47 | $25.77 | $20.15 | $23.06 | $22.37 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (24.11)% | 32.42% | (8.94)% | 8.41% | (10.48)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.48% | 0.48% | 0.48% | 0.48% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.47% | 0.47% | 0.47% | 0.47% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 5.11% | 3.80% | 3.68% | 4.98% | 4.77% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 5.11% | 3.81% | 3.68% | 4.98% | 4.78% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 69% | 68% | 74% | 71% | 71% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $432097 | $616007 | $453477 | $774685 | $765167 |

---

*See Accompanying Notes to the Financial Statements.* 

120 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund | FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $23.82 | $19.16 | $21.87 | $21.39 | $25.06 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.99 <sup>(a)</sup> | 0.93 <sup>(a)</sup> | 0.74 <sup>(a)</sup> | 1.09 <sup>(a)</sup> | 1.14 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (6.14) | 4.62 | (2.70) | 0.51 | (3.54) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (5.15) | 5.55 | (1.96) | 1.60 | (2.40) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.04) | (0.89) | (0.75) | (1.12) | (1.27) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.04) | (0.89) | (0.75) | (1.12) | (1.27) |
|  **Net Asset Value, end of period** | $17.63 | $23.82 | $19.16 | $21.87 | $21.39 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (22.06)% | 29.03% | (8.92)% | 7.66% | (10.03)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.48% | 0.48% | 0.48% | 0.48% | 0.48% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.47% | 0.47% | 0.47% | 0.47% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 4.62% | 3.91% | 3.65% | 5.02% | 4.68% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 4.62% | 3.92% | 3.66% | 5.03% | 4.68% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 65% | 65% | 75% | 63% | 69% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $40545 | $71459 | $59404 | $78719 | $87703 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 121

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund | FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $30.39 | $22.38 | $24.94 | $23.51 | $27.82 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.45 <sup>(a)</sup> | 1.28 <sup>(a)</sup> | 0.70 <sup>(a)</sup> | 1.05 <sup>(a)</sup> | 1.32 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (9.01) | 7.63 | (2.45) | 1.52 | (4.34) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (7.56) | 8.91 | (1.75) | 2.57 | (3.02) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.52) | (0.90) | (0.81) | (1.14) | (1.29) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.52) | (0.90) | (0.81) | (1.14) | (1.29) |
|  **Net Asset Value, end of period** | $21.31 | $30.39 | $22.38 | $24.94 | $23.51 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (25.48)% | 39.87% | (6.99)% | 11.30% | (11.34)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.48% | 0.48% | 0.48% | 0.48% | 0.48% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.47% | 0.47% | 0.47% | 0.47% | 0.47% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 5.49% | 4.24% | 2.90% | 4.36% | 4.83% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 5.49% | 4.25% | 2.91% | 4.37% | 4.83% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 74% | 72% | 85% | 88% | 75% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $61788 | $75975 | $22376 | $47391 | $63481 |

---

*See Accompanying Notes to the Financial Statements.* 

122 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $26.38 | $25.73 | $24.58 | $23.81 | $24.60 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.72 <sup>(a)</sup> | 1.09 <sup>(a)</sup> | 0.33 <sup>(a)</sup> | 0.46 <sup>(a)</sup> | 0.68 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (2.83) | 0.68 | 1.09 | 0.79 | (0.78) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (1.11) | 1.77 | 1.42 | 1.25 | (0.10) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.66) | (1.12) | (0.27) | (0.48) | (0.69) |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital | (0.03) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.69) | (1.12) | (0.27) | (0.48) | (0.69) |
|  **Net Asset Value, end of period** | $23.58 | $26.38 | $25.73 | $24.58 | $23.81 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (4.44)% | 6.95% | 5.81% | 5.30% | (0.41)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.19% | 0.19% | 0.19% | 0.19% | 0.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.18% | 0.18% | 0.18% | 0.18% | 0.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 6.82% | 4.14% | 1.33% | 1.89% | 2.79% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 6.83% | 4.15% | 1.33% | 1.89% | 2.80% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 116% | 53% | 71% | 52% | 85% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $2157939 | $1437584 | $1429491 | $1178722 | $1641610 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 123

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund | FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $28.02 | $27.34 | $25.50 | $23.95 | $25.06 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.83 <sup>(a)</sup> | 1.16 <sup>(a)</sup> | 0.36 <sup>(a)</sup> | 0.44 <sup>(a)</sup> | 0.71 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (4.35) | 0.70 | 1.76 | 1.59 | (1.08) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (2.52) | 1.86 | 2.12 | 2.03 | (0.37) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.84) | (1.18) | (0.28) | (0.48) | (0.74) |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital | (0.03) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.87) | (1.18) | (0.28) | (0.48) | (0.74) |
|  **Net Asset Value, end of period** | $23.63 | $28.02 | $27.34 | $25.50 | $23.95 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (9.46)% | 6.88% | 8.39% | 8.53% | (1.51)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.19% | 0.19% | 0.19% | 0.19% | 0.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.18% | 0.18% | 0.18% | 0.18% | 0.18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 6.98% | 4.17% | 1.35% | 1.77% | 2.88% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 6.98% | 4.17% | 1.35% | 1.78% | 2.88% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 80% | 46% | 66% | 41% | 65% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $643886 | $714479 | $596095 | $557185 | $904027 |

---

*See Accompanying Notes to the Financial Statements.* 

124 FLEXSHARES ANNUAL REPORT

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund | FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund | FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund | FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund | FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $23.42 | $24.10 | $23.55 | $22.74 | $23.86 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.26 <sup>(a)</sup> | 0.09 <sup>(a)</sup> | 0.37 <sup>(a)</sup> | 0.61 <sup>(a)</sup> | 0.49 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (3.07) | (0.16) | 0.85 | 1.03 | (0.88) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (2.81) | (0.07) | 1.22 | 1.64 | (0.39) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.57) | (0.61) | (0.67) | (0.83) | (0.73) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.57) | (0.61) | (0.67) | (0.83) | (0.73) |
|  **Net Asset Value, end of period** | $20.04 | $23.42 | $24.10 | $23.55 | $22.74 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (12.16)% | (0.28)% | 5.19% | 7.36% | (1.65)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.21% | 0.21% | 0.21% | 0.21% | 0.21% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.20% | 0.20% | 0.20% | 0.20% | 0.20% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.19% | 0.35% | 1.54% | 2.64% | 2.09% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.19% | 0.36% | 1.54% | 2.65% | 2.10% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 222% | 476% | 175% | 61% | 160% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $97189 | $111243 | $100020 | $35330 | $71628 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 125

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $53.52 | $54.70 | $52.58 | $48.59 | $50.98 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.04 <sup>(a)</sup> | 0.91 <sup>(a)</sup> | 1.32 <sup>(a)</sup> | 1.63 <sup>(a)</sup> | 1.40 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (7.83) | (0.51) | 2.39 | 3.94 | (2.43) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (6.79) | 0.40 | 3.71 | 5.57 | (1.03) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.06) | (0.96) | (1.37) | (1.58) | (1.36) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains | (0.41) | (0.62) | (0.22) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.47) | (1.58) | (1.59) | (1.58) | (1.36) |
|  **Net Asset Value, end of period** | $45.26 | $53.52 | $54.70 | $52.58 | $48.59 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (12.91)% | 0.70% | 7.20% | 11.66% | (2.05)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.23% | 0.23% | 0.23% | 0.23% | 0.23% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.22% | 0.22% | 0.22% | 0.22% | 0.22% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.11% | 1.68% | 2.46% | 3.20% | 2.83% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.11% | 1.69% | 2.46% | 3.21% | 2.84% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 66% | 53% | 62% | 65% | 76% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $242139 | $315740 | $202397 | $97275 | $60736 |

---

*See Accompanying Notes to the Financial Statements.* 

126 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund | FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $60.85 | $61.81 | $57.84 | $48.04 | $53.88 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.93 <sup>(a)</sup> | 1.90 <sup>(a)</sup> | 1.99 <sup>(a)</sup> | 2.11 <sup>(a)</sup> | 2.07 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (20.48) | 1.22 | 3.90 | 9.89 | (5.87) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (18.55) | 3.12 | 5.89 | 12.00 | (3.80) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.92) | (1.88) | (1.92) | (2.20) | (2.04) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains | (0.94) | (2.20) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.86) | (4.08) | (1.92) | (2.20) | (2.04) |
|  **Net Asset Value, end of period** | $39.44 | $60.85 | $61.81 | $57.84 | $48.04 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (31.58)% | 5.14% | 10.34% | 25.57% | (7.24)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.23% | 0.23% | 0.23% | 0.23% | 0.23% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.22% | 0.22% | 0.22% | 0.22% | 0.22% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 3.86% | 3.13% | 3.27% | 4.06% | 4.05% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 3.86% | 3.14% | 3.28% | 4.07% | 4.06% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 58% | 88% | 74% | 44% | 93% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $35498 | $60855 | $46360 | $17352 | $26424 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 127

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund | FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund | FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund | FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund | FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | For the<br> period<br>07/17/18\*<br>through<br>10/31/18 |
|  **Net asset value, beginning of period** | $49.58 | $46.25 | $47.85 | $48.84 | $50.00 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 2.98 <sup>(a)</sup> | 2.67 <sup>(a)</sup> | 3.12 <sup>(a)</sup> | 2.67 <sup>(a)</sup> | 1.68 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (9.24) | 3.42 | (1.77) | 0.78 | (1.60) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (6.26) | 6.09 | 1.35 | 3.45 | 0.08 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.86) | (2.76) | (2.95) | (3.57) | (1.24) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains | (0.37) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax Return of Capital |  |  |  | (0.87) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (3.23) | (2.76) | (2.95) | (4.44) | (1.24) |
|  **Net Asset Value, end of period** | $40.09 | $49.58 | $46.25 | $47.85 | $48.84 |
|  **Total Return<sup>(b)</sup>** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (13.06)% | 13.38% | 3.07% | 7.48% | 0.13% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.38% | 0.38% | 0.38% | 0.38% | 0.38% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.37% | 0.37% | 0.37% | 0.37% | 0.37% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 6.81% | 5.40% | 6.78% | 5.56% | 11.56% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 6.81% | 5.40% | 6.78% | 5.57% | 11.57% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 146% | 128% | 95% | 44% | 18% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $887945 | $575184 | $189623 | $100480 | $48845 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

128 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | |
|:---|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate <br>High Yield Corporate Core<br>Index Fund | FlexShares<sup>®</sup> ESG & Climate <br>High Yield Corporate Core<br>Index Fund |
|  | Year ended<br>October 31,<br>2022 | For the<br>period<br>09/20/21\*<br>through<br>10/31/21 |
|  **Net asset value, beginning of period** | $49.77 | $50.00 |
|  **PER SHARE** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 2.04 <sup>(a)</sup> | 0.21 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (8.09) | (0.44) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (6.05) | (0.23) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (2.86) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (2.86) |  |
|  **Net Asset Value, end of period** | $40.86 | $49.77 |
|  **Total Return<sup>(b)</sup>** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (12.47)% | (0.50)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.24% | 0.23% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.23% | 0.23% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 4.37% | 3.64% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 4.37% | 3.64% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 119% | 8% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $20432 | $49767 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 129

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | |
|:---|:---|:---|
|  | FlexShares<sup>®</sup> ESG & Climate<br>Investment Grade Corporate <br>Core Index Fund | FlexShares<sup>®</sup> ESG & Climate<br>Investment Grade Corporate <br>Core Index Fund |
|  | Year ended<br>October 31,<br>2022 | For the<br>period<br>09/20/21\*<br>through<br>10/31/21 |
|  **Net asset value, beginning of period** | $49.35 | $50.00 |
|  **PER SHARE** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.07 <sup>(a)</sup> | 0.10 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (10.68) | (0.75) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (9.61) | (0.65) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (1.15) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (1.15) |  |
|  **Net Asset Value, end of period** | $38.59 | $49.35 |
|  **Total Return<sup>(b)</sup>** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (19.73)% | (1.32)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets<sup>(c)</sup>** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.13% | 0.12% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.12% | 0.12% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.41% | 1.81% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.41% | 1.81% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(b)(e)</sup> | 66% | 8% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $23156 | $49347 |

---

*\** *Commencement of investment operations.* 

*See Accompanying Notes to the Financial Statements.* 

130 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Ready Access Variable Income Fund | FlexShares<sup>®</sup> Ready Access Variable Income Fund | FlexShares<sup>®</sup> Ready Access Variable Income Fund | FlexShares<sup>®</sup> Ready Access Variable Income Fund | FlexShares<sup>®</sup> Ready Access Variable Income Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $76.01 | $76.29 | $75.89 | $75.48 | $75.61 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 1.07 <sup>(a)</sup> | 0.48 <sup>(a)</sup> | 1.07 <sup>(a)</sup> | 1.98 <sup>(a)</sup> | 1.58 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (1.80) | (0.22) | 0.57 | 0.41 | (0.24) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (0.73) | 0.26 | 1.64 | 2.39 | 1.34 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.78) | (0.52) | (1.23) | (1.98) | (1.47) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains | (0.20) | (0.02) | (0.01) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.98) | (0.54) | (1.24) | (1.98) | (1.47) |
|  **Net Asset Value, end of period** | $74.30 | $76.01 | $76.29 | $75.89 | $75.48 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (0.94)% | 0.34% | 2.18% | 3.21% | 1.80% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.26% | 0.26% | 0.26% | 0.26% | 0.26% |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.25% | 0.25% | 0.25% | 0.25% | 0.25% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 1.43% | 0.62% | 1.41% | 2.61% | 2.09% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 1.43% | 0.63% | 1.41% | 2.62% | 2.10% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 50% | 84% | 79% | 73% | 131% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $856357 | $374339 | $469201 | $275097 | $211350 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 131

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | FlexShares<sup>®</sup> Core Select Bond Fund | FlexShares<sup>®</sup> Core Select Bond Fund | FlexShares<sup>®</sup> Core Select Bond Fund | FlexShares<sup>®</sup> Core Select Bond Fund | FlexShares<sup>®</sup> Core Select Bond Fund |
|  | Year ended<br>October 31,<br>2022 | Year ended<br>October 31,<br>2021 | Year ended<br>October 31,<br>2020 | Year ended<br>October 31,<br>2019 | Year ended<br>October 31, <br>2018 |
|  **Net asset value, beginning of period** | $26.22 | $26.78 | $25.66 | $23.74 | $25.08 |
|  **PER SHARE** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Investment Operations** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | 0.53 <sup>(a)</sup> | 0.46 <sup>(a)</sup> | 0.51 <sup>(a)</sup> | 0.73 <sup>(a)</sup> | 0.63 <sup>(a)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Realized and Unrealized Gain (Loss) | (4.75) | (0.39) | 1.19 | 1.93 | (1.31) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Operations | (4.22) | 0.07 | 1.70 | 2.66 | (0.68) |
| &nbsp;&nbsp;&nbsp;&nbsp; **Distributions** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income | (0.54) | (0.52) | (0.58) | (0.74) | (0.66) |
| &nbsp;&nbsp;&nbsp;&nbsp; From Net Realized Gains |  | (0.11) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from Distributions | (0.54) | (0.63) | (0.58) | (0.74) | (0.66) |
|  **Net Asset Value, end of period** | $21.46 | $26.22 | $26.78 | $25.66 | $23.74 |
|  **Total Return** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Asset Value<sup>(d)</sup> | (16.27)% | 0.26% | 6.69% | 11.38% | (2.73)% |
|  **RATIOS/SUPPLEMENT DATA** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** | &nbsp;&nbsp;&nbsp;&nbsp; **Ratios to Average Net Assets** |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses | 0.36 %<sup>(h)</sup> | 0.36 %<sup>(h)</sup> | 0.36 %<sup>(h)</sup> | 0.36 %<sup>(h)</sup> | 0.36 %<sup>(h)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Expenses net of reimbursements | 0.22 %<sup>(h)</sup> | 0.20 %<sup>(h)</sup> | 0.20 %<sup>(h)</sup> | 0.19 %<sup>(h)</sup> | 0.16 %<sup>(h)</sup> |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Before Reimbursements | 2.10% | 1.56% | 1.76% | 2.80% | 2.41% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net Investment Income Net of Reimbursements | 2.24% | 1.72% | 1.93% | 2.97% | 2.61% |
| &nbsp;&nbsp;&nbsp;&nbsp; **Supplemental Data** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Portfolio Turnover Rate<sup>(e)</sup> | 121% | 50% | 91% | 135% | 53% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net assets, end of period (thousands) | $159362 | $126517 | $109123 | $26299 | $38583 |

---

*See Accompanying Notes to the Financial Statements.* 

132 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Financial Highlights (cont.)

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*(a)* *Net investment income per share is based on average shares outstanding.* 

*(b)* *Not annualized for periods less than one year.* 

*(c)* *Annualized for periods less than one year.* 

*(d)* *Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period and redemption on the last day of the period at adjusted net asset value.* 

*(e)* *In-kind transactions are not included in portfolio turnover calculations.* 

*(f)* *Less than 0.5%.* 

*(g)* *Per share amount is less than $0.005.* 

*(h)* *The Fund indirectly bears its proportionate share of fees and expenses incurred by the Underlying Fund(s) in which the Fund is invested. This ratio does not include these indirect fees and expenses.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 133

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> US Quality Low Volatility Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.6%** | **COMMON STOCKS – 99.6%** | **COMMON STOCKS – 99.6%** |
| **Air Freight & Logistics – 1.7%** | **Air Freight & Logistics – 1.7%** | **Air Freight & Logistics – 1.7%** |
|  CH Robinson Worldwide, Inc.(a) | 7930 | $774920 |
|  Expeditors International of Washington, Inc. | 13000 | 1272050 |
|  United Parcel Service, Inc., Class B | 3770 | 632493 |
|  |  | **2679463** |
| **Auto Components – 0.0%(b)** | **Auto Components – 0.0%(b)** | **Auto Components – 0.0%(b)** |
|  Gentex Corp. | 1560 | 41324 |
| **Automobiles – 0.8%** | **Automobiles – 0.8%** | **Automobiles – 0.8%** |
|  Tesla, Inc.\* | 5460 | 1242368 |
| **Banks – 3.3%** | **Banks – 3.3%** | **Banks – 3.3%** |
|  CVB Financial Corp.(a) | 32370 | 929666 |
|  First Republic Bank | 650 | 78065 |
|  PNC Financial Services Group, Inc. (The) | 6760 | 1093971 |
|  Popular, Inc.(a) | 15990 | 1130813 |
|  Prosperity Bancshares, Inc.(a) | 17550 | 1256053 |
|  Umpqua Holdings Corp. | 46150 | 917462 |
|  |  | **5406030** |
| **Beverages – 2.2%** | **Beverages – 2.2%** | **Beverages – 2.2%** |
|  PepsiCo, Inc. | 19630 | 3564415 |
| **Biotechnology – 6.3%** | **Biotechnology – 6.3%** | **Biotechnology – 6.3%** |
|  AbbVie, Inc. | 8190 | 1199016 |
|  Amgen, Inc. | 11440 | 3092804 |
|  Biogen, Inc.\* | 6760 | 1916054 |
|  Gilead Sciences, Inc. | 26780 | 2101159 |
|  Regeneron Pharmaceuticals, Inc.\* | 2340 | 1752075 |
|  United Therapeutics Corp.\* | 910 | 209782 |
|  |  | **10270890** |
| **Capital Markets – 1.2%** | **Capital Markets – 1.2%** | **Capital Markets – 1.2%** |
|  CME Group, Inc. | 5850 | 1013805 |
|  Nasdaq, Inc. | 14690 | 914306 |
|  |  | **1928111** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Chemicals – 1.9%** | **Chemicals – 1.9%** | **Chemicals – 1.9%** |
|  Ashland, Inc. | 8320 | $872935 |
|  Corteva, Inc. | 17160 | 1121234 |
|  Ecolab, Inc. | 6110 | 959698 |
|  Linde plc(a) | 520 | 154622 |
|  |  | **3108489** |
| **Commercial Services & Supplies – 2.9%** | **Commercial Services & Supplies – 2.9%** | **Commercial Services & Supplies – 2.9%** |
|  Republic Services, Inc. | 7020 | 930992 |
|  Tetra Tech, Inc. | 9360 | 1322381 |
|  Waste Connections, Inc. | 7280 | 960305 |
|  Waste Management, Inc. | 9360 | 1482343 |
|  |  | **4696021** |
| **Containers & Packaging – 0.8%** | **Containers & Packaging – 0.8%** | **Containers & Packaging – 0.8%** |
|  International Paper Co. | 16770 | 563640 |
|  Packaging Corp. of America | 6500 | 781365 |
|  |  | **1345005** |
| **Distributors – 0.2%** | **Distributors – 0.2%** | **Distributors – 0.2%** |
|  Genuine Parts Co. | 2080 | 369949 |
| **Diversified Consumer Services – 0.7%** | **Diversified Consumer Services – 0.7%** | **Diversified Consumer Services – 0.7%** |
|  Service Corp. International(a) | 20020 | 1213412 |
| **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** |
|  Berkshire Hathaway, Inc., Class B\* | 2730 | 805596 |
| **Diversified Telecommunication Services – 1.4%** | **Diversified Telecommunication Services – 1.4%** | **Diversified Telecommunication Services – 1.4%** |
|  AT&T, Inc. | 33020 | 601954 |
|  Verizon Communications, Inc. | 45110 | 1685761 |
|  |  | **2287715** |
| **Electric Utilities – 3.2%** | **Electric Utilities – 3.2%** | **Electric Utilities – 3.2%** |
|  American Electric Power Co., Inc. | 10400 | 914368 |
|  Duke Energy Corp. | 10920 | 1017526 |
|  NextEra Energy, Inc. | 19890 | 1541475 |
|  PNM Resources, Inc. | 18590 | 863877 |
|  Xcel Energy, Inc. | 13520 | 880287 |
|  |  | **5217533** |

---

*See Accompanying Notes to the Financial Statements.* 

134 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> US Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – 3.3%** | **Equity Real Estate Investment Trusts (REITs) – 3.3%** | **Equity Real Estate Investment Trusts (REITs) – 3.3%** |
|  American Tower Corp. | 1430 | $296282 |
|  Crown Castle, Inc. | 9360 | 1247313 |
|  Digital Realty Trust, Inc.(a) | 7800 | 781950 |
|  Equinix, Inc. | 1620 | 917633 |
|  Essex Property Trust, Inc. | 3120 | 693389 |
|  Public Storage | 4420 | 1369095 |
|  |  | **5305662** |
| **Food & Staples Retailing – 2.7%** | **Food & Staples Retailing – 2.7%** | **Food & Staples Retailing – 2.7%** |
|  Albertsons Cos., Inc., Class A | 31460 | 645245 |
|  Costco Wholesale Corp. | 4550 | 2281825 |
|  Kroger Co. (The) | 29250 | 1383232 |
|  Walmart, Inc. | 520 | 74012 |
|  |  | **4384314** |
| **Food Products – 1.7%** | **Food Products – 1.7%** | **Food Products – 1.7%** |
|  Flowers Foods, Inc. | 32240 | 925610 |
|  Hershey Co. (The) | 4420 | 1055363 |
|  Hormel Foods Corp.(a) | 18330 | 851429 |
|  |  | **2832402** |
| **Gas Utilities – 0.1%** | **Gas Utilities – 0.1%** | **Gas Utilities – 0.1%** |
|  Spire, Inc.(a) | 3380 | 235958 |
| **Health Care Equipment & Supplies – 0.6%** | **Health Care Equipment & Supplies – 0.6%** | **Health Care Equipment & Supplies – 0.6%** |
|  Abbott Laboratories | 9100 | 900354 |
| **Health Care Providers & Services – 1.0%** | **Health Care Providers & Services – 1.0%** | **Health Care Providers & Services – 1.0%** |
|  Chemed Corp. | 2600 | 1213862 |
|  UnitedHealth Group, Inc. | 780 | 433017 |
|  |  | **1646879** |
| **Hotels, Restaurants & Leisure – 0.2%** | **Hotels, Restaurants & Leisure – 0.2%** | **Hotels, Restaurants & Leisure – 0.2%** |
|  Booking Holdings, Inc.\* | 198 | 370157 |
| **Household Durables – 0.4%** | **Household Durables – 0.4%** | **Household Durables – 0.4%** |
|  Newell Brands, Inc.(a) | 43160 | 596040 |
| **Household Products – 2.9%** | **Household Products – 2.9%** | **Household Products – 2.9%** |
|  Clorox Co. (The)(a) | 9100 | 1328964 |
|  Procter & Gamble Co. (The) | 25090 | 3378870 |
|  |  | **4707834** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Insurance – 8.7%** | **Insurance – 8.7%** | **Insurance – 8.7%** |
|  Allstate Corp. (The) | 4680 | $590850 |
|  American Financial Group, Inc. | 5850 | 848894 |
|  Aon plc, Class A | 3770 | 1061217 |
|  Assurant, Inc. | 7930 | 1077370 |
|  Chubb Ltd. | 9100 | 1955499 |
|  Everest Re Group Ltd. | 3250 | 1048645 |
|  Hanover Insurance Group, Inc. (The) | 9880 | 1447321 |
|  Markel Corp.\* | 743 | 896132 |
|  Progressive Corp. (The) | 9360 | 1201824 |
|  RenaissanceRe Holdings Ltd. | 6370 | 985312 |
|  Selective Insurance Group, Inc.(a) | 390 | 38251 |
|  Travelers Cos., Inc. (The) | 8580 | 1582667 |
|  W R Berkley Corp. | 13130 | 976609 |
|  Willis Towers Watson plc | 2340 | 510612 |
|  |  | **14221203** |
| **Interactive Media & Services – 1.1%** | **Interactive Media & Services – 1.1%** | **Interactive Media & Services – 1.1%** |
|  Alphabet, Inc., Class A\* | 10530 | 995190 |
|  Alphabet, Inc., Class C\* | 8840 | 836795 |
|  |  | **1831985** |
| **IT Services – 7.3%** | **IT Services – 7.3%** | **IT Services – 7.3%** |
|  Akamai Technologies, Inc.\* | 4420 | 390418 |
|  Amdocs Ltd. | 15080 | 1301555 |
|  Automatic Data Processing, Inc. | 6240 | 1508208 |
|  International Business Machines Corp. | 19240 | 2660699 |
|  Jack Henry & Associates, Inc. | 6760 | 1345646 |
|  Mastercard, Inc., Class A | 2470 | 810605 |
|  Visa, Inc., Class A(a) | 18330 | 3797243 |
|  |  | **11814374** |
| **Life Sciences Tools & Services – 0.8%** | **Life Sciences Tools & Services – 0.8%** | **Life Sciences Tools & Services – 0.8%** |
|  QIAGEN NV\* | 28990 | 1262804 |
| **Media – 0.9%** | **Media – 0.9%** | **Media – 0.9%** |
|  Cable One, Inc. | 600 | 515658 |
|  Charter Communications, Inc., Class A\* | 2600 | 955812 |
|  |  | **1471470** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 135

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> US Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – 1.1%** | **Metals & Mining – 1.1%** | **Metals & Mining – 1.1%** |
|  Newmont Corp. | 23270 | $984786 |
|  Royal Gold, Inc.(a) | 9230 | 876481 |
|  |  | **1861267** |
| **Multiline Retail – 1.4%** | **Multiline Retail – 1.4%** | **Multiline Retail – 1.4%** |
|  Dollar General Corp. | 4420 | 1127321 |
|  Target Corp. | 7150 | 1174388 |
|  |  | **2301709** |
| **Multi-Utilities – 2.4%** | **Multi-Utilities – 2.4%** | **Multi-Utilities – 2.4%** |
|  Ameren Corp. | 5720 | 466294 |
|  CMS Energy Corp. | 19500 | 1112475 |
|  Consolidated Edison, Inc. | 10140 | 891914 |
|  Dominion Energy, Inc. | 1560 | 109153 |
|  WEC Energy Group, Inc. | 13650 | 1246655 |
|  |  | **3826491** |
| **Oil, Gas & Consumable Fuels – 0.3%** | **Oil, Gas & Consumable Fuels – 0.3%** | **Oil, Gas & Consumable Fuels – 0.3%** |
|  Coterra Energy, Inc.(a) | 4810 | 149735 |
|  Exxon Mobil Corp. | 390 | 43216 |
|  Kinder Morgan, Inc. | 19110 | 346273 |
|  |  | **539224** |
| **Pharmaceuticals – 11.8%** | **Pharmaceuticals – 11.8%** | **Pharmaceuticals – 11.8%** |
|  Bristol-Myers Squibb Co. | 11310 | 876186 |
|  Eli Lilly & Co. | 16640 | 6025178 |
|  Johnson & Johnson | 46150 | 8028715 |
|  Merck & Co., Inc. | 41990 | 4249388 |
|  Zoetis, Inc. | 260 | 39203 |
|  |  | **19218670** |
| **Professional Services – 1.7%** | **Professional Services – 1.7%** | **Professional Services – 1.7%** |
|  CACI International, Inc., Class A\* | 3120 | 948573 |
|  FTI Consulting, Inc.\* (a) | 5200 | 809276 |
|  Verisk Analytics, Inc. | 5590 | 1022020 |
|  |  | **2779869** |
| **Road & Rail – 2.2%** | **Road & Rail – 2.2%** | **Road & Rail – 2.2%** |
|  JB Hunt Transport Services, Inc. | 4940 | 845086 |
|  Landstar System, Inc.(a) | 8580 | 1340367 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  Old Dominion Freight Line, Inc.(a) | 4810 | $| 1320826 |
|  |  |  | **3506279** |
| **Semiconductors & Semiconductor Equipment – 0.1%** | **Semiconductors & Semiconductor Equipment – 0.1%** | **Semiconductors & Semiconductor Equipment – 0.1%** | **Semiconductors & Semiconductor Equipment – 0.1%** |
|  NVIDIA Corp. | 910 |  | 122823 |
| **Software – 8.7%** | **Software – 8.7%** | **Software – 8.7%** | **Software – 8.7%** |
|  Check Point Software Technologies Ltd.\* | 11050 |  | 1427991 |
|  Microsoft Corp. | 48490 |  | 11255984 |
|  Roper Technologies, Inc. | 3250 |  | 1347255 |
|  VMware, Inc., Class A | 260 |  | 29258 |
|  |  |  | **14060488** |
| **Specialty Retail – 3.9%** | **Specialty Retail – 3.9%** | **Specialty Retail – 3.9%** | **Specialty Retail – 3.9%** |
|  AutoZone, Inc.\* | 130 |  | 329274 |
|  Home Depot, Inc. (The) | 14300 |  | 4234659 |
|  O'Reilly Automotive, Inc.\* | 2022 |  | 1692758 |
|  |  |  | **6256691** |
| **Technology Hardware, Storage & Peripherals – 5.5%** | **Technology Hardware, Storage & Peripherals – 5.5%** | **Technology Hardware, Storage & Peripherals – 5.5%** | **Technology Hardware, Storage & Peripherals – 5.5%** |
|  Apple, Inc. | 58370 |  | 8950456 |
| **Tobacco – 0.9%** | **Tobacco – 0.9%** | **Tobacco – 0.9%** | **Tobacco – 0.9%** |
|  Altria Group, Inc. | 31460 |  | 1455654 |
| **Water Utilities – 0.8%** | **Water Utilities – 0.8%** | **Water Utilities – 0.8%** | **Water Utilities – 0.8%** |
|  American Water Works Co., Inc. | 8970 |  | 1303700 |
| **Total Common Stocks <br>(Cost $150,814,845)** | **Total Common Stocks <br>(Cost $150,814,845)** |  | **161941078** |
|  | Principal<br>Amount |  |  |
| **SECURITIES LENDING REINVESTMENTS(c) – 0.7%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.7%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.7%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.7%** |
| **REPURCHASE AGREEMENTS – 0.7%** | **REPURCHASE AGREEMENTS – 0.7%** | **REPURCHASE AGREEMENTS – 0.7%** | **REPURCHASE AGREEMENTS – 0.7%** |
|  CF Secured LLC, 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $1,157,007, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2022 – 8/15/2052; total market value $1,173,764<br>(Cost $1,156,911) | $1156911 |  | 1156911 |

---

*See Accompanying Notes to the Financial Statements.* 

136 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> US Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SHORT-TERM INVESTMENTS – 0.0%(b)** | **SHORT-TERM INVESTMENTS – 0.0%(b)** | **SHORT-TERM INVESTMENTS – 0.0%(b)** |
| **U.S. TREASURY OBLIGATIONS – 0.0%(b)** | **U.S. TREASURY OBLIGATIONS – 0.0%(b)** | **U.S. TREASURY OBLIGATIONS – 0.0%(b)** |
|  U.S. Treasury Bills 2.54%, 11/25/2022(d) (Cost $34,941) | $35000 | $34924 |
| **Total Investments – 100.3% (Cost $152,006,697)** | **Total Investments – 100.3% (Cost $152,006,697)** | **163132913** |
|  Liabilities in excess of other assets – (0.3%) | Liabilities in excess of other assets – (0.3%) | (564390) |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**162568523** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $14,183,739, collateralized in the form of cash with a value of $1,156,911 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments and $13,361,701 of collateral in the form of U.S. Government* 

 *Treasury Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from November 15, 2022 – May 15, 2052; a total value of $14,518,612.* 

*<sup>(b)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $1,156,911.* 

*<sup>(d)</sup>* *The rate shown was the current yield as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $19192205 |
|  Aggregate gross unrealized depreciation | (8215781) |
|  Net unrealized appreciation | $10976424 |
|  Federal income tax cost | $152163286 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> US Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  S&P 500 E-Mini Index | 2 | 12/16/2022 | USD | $388300 | $(1033) |
|  S&P 500 Micro E-Mini Index | 10 | 12/16/2022 | USD | 194150 | 7830 |
|  |  |  |  |  | $6797 |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.6 |
|  Securities Lending Reinvestments | 0.7 |
|  Short-Term Investments | 0.0 |
|  Others<sup>(1)</sup> | (0.3 |
|  | 100.0 |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 137

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##### [**Table of Contents**](#toc)

------

## Schedule of Investments
FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.1%** | **COMMON STOCKS – 98.1%** | **COMMON STOCKS – 98.1%** |
| **Aerospace & Defense – 1.1%** | **Aerospace & Defense – 1.1%** | **Aerospace & Defense – 1.1%** |
|  BAE Systems plc | 31416 | $294575 |
|  Singapore Technologies Engineering Ltd. | 176400 | 411363 |
|  |  | **705938** |
| **Air Freight & Logistics – 0.9%** | **Air Freight & Logistics – 0.9%** | **Air Freight & Logistics – 0.9%** |
|  SG Holdings Co. Ltd. | 22400 | 297190 |
|  Yamato Holdings Co. Ltd. | 16800 | 249115 |
|  |  | **546305** |
| **Auto Components – 0.2%** | **Auto Components – 0.2%** | **Auto Components – 0.2%** |
|  Bridgestone Corp. | 2800 | 101010 |
| **Automobiles – 0.7%** | **Automobiles – 0.7%** | **Automobiles – 0.7%** |
|  Ferrari NV | 1316 | 259484 |
|  Toyota Motor Corp. | 14000 | 193985 |
|  |  | **453469** |
| **Banks – 11.5%** | **Banks – 11.5%** | **Banks – 11.5%** |
|  Bank Hapoalim BM | 54488 | 527928 |
|  Bank Leumi Le-Israel BM | 54068 | 518481 |
|  Bankinter SA(a) | 52556 | 317688 |
|  BOC Hong Kong Holdings Ltd. | 154000 | 478684 |
|  Chiba Bank Ltd. (The)(a) | 47600 | 260361 |
|  DBS Group Holdings Ltd. | 30800 | 744371 |
|  Hang Seng Bank Ltd. | 16800 | 236489 |
|  HSBC Holdings plc | 21364 | 110024 |
|  Mitsubishi UFJ Financial Group, Inc. | 58800 | 276722 |
|  Mizrahi Tefahot Bank Ltd. | 6748 | 256345 |
|  Mizuho Financial Group, Inc. | 39200 | 423556 |
|  Oversea-Chinese Banking Corp. Ltd. | 58800 | 504024 |
|  Royal Bank of Canada | 15652 | 1446381 |
|  Sumitomo Mitsui Financial Group, Inc. | 20900 | 586778 |
|  Toronto-Dominion Bank (The) | 6692 | 427752 |
|  |  | **7115584** |
| **Beverages – 0.4%** | **Beverages – 0.4%** | **Beverages – 0.4%** |
|  Budweiser Brewing Co. APAC Ltd.(b) | 22400 | 47141 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** |
|  Suntory Beverage & Food Ltd. | 5600 | $| 187627 |
|  |  |  | **234768** |
| **Capital Markets – 2.2%** | **Capital Markets – 2.2%** | **Capital Markets – 2.2%** | **Capital Markets – 2.2%** |
|  Deutsche Boerse AG | 3612 |  | 587788 |
|  Euronext NV(b) | 2324 |  | 147692 |
|  Japan Exchange Group, Inc. | 16800 |  | 220801 |
|  Singapore Exchange Ltd. | 70000 |  | 416508 |
|  |  |  | **1372789** |
| **Chemicals – 3.3%** | **Chemicals – 3.3%** | **Chemicals – 3.3%** | **Chemicals – 3.3%** |
|  Air Liquide SA | 7924 |  | 1036132 |
|  Akzo Nobel NV | 280 |  | 17280 |
|  Givaudan SA (Registered) | 28 |  | 83657 |
|  ICL Group Ltd. | 14140 |  | 128242 |
|  Novozymes A/S, Class B | 8568 |  | 450094 |
|  Symrise AG | 2856 |  | 291729 |
|  |  |  | **2007134** |
| **Commercial Services & Supplies – 1.4%** | **Commercial Services & Supplies – 1.4%** | **Commercial Services & Supplies – 1.4%** | **Commercial Services & Supplies – 1.4%** |
|  Brambles Ltd. | 19964 |  | 149107 |
|  Dai Nippon Printing Co. Ltd. | 11200 |  | 224776 |
|  Secom Co. Ltd. | 8400 |  | 479863 |
|  |  |  | **853746** |
| **Construction & Engineering – 0.3%** | **Construction & Engineering – 0.3%** | **Construction & Engineering – 0.3%** | **Construction & Engineering – 0.3%** |
|  Ackermans & van Haaren NV | 252 |  | 35143 |
|  Bouygues SA | 4704 |  | 134269 |
|  |  |  | **169412** |
| **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** |
|  Groupe Bruxelles Lambert NV | 3668 |  | 270445 |
|  HAL Trust | 196 |  | 22587 |
|  |  |  | **293032** |
| **Diversified Telecommunication Services – 5.8%** | **Diversified Telecommunication Services – 5.8%** | **Diversified Telecommunication Services – 5.8%** | **Diversified Telecommunication Services – 5.8%** |
|  BCE, Inc. | 7980 |  | 359898 |
|  Elisa OYJ | 9156 |  | 442603 |
|  HKT Trust & HKT Ltd. | 196000 |  | 221472 |
|  Koninklijke KPN NV | 152264 |  | 426038 |
|  Nippon Telegraph & Telephone Corp. | 19600 |  | 539862 |

---

*See Accompanying Notes to the Financial Statements.* 

138 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |
|  Orange SA | 36344 | $| 345951 |
|  Proximus SADP | 12684 |  | 133009 |
|  Singapore Telecommunications Ltd. | 165200 |  | 291852 |
|  Spark New Zealand Ltd. | 15176 |  | 45141 |
|  Swisscom AG (Registered) | 980 |  | 484051 |
|  Telefonica Deutschland Holding AG | 73696 |  | 160679 |
|  TELUS Corp. | 7728 |  | 161183 |
|  |  |  | **3611739** |
| **Electric Utilities – 4.5%** | **Electric Utilities – 4.5%** | **Electric Utilities – 4.5%** | **Electric Utilities – 4.5%** |
|  Chubu Electric Power Co., Inc.(a) | 25200 |  | 205316 |
|  CK Infrastructure Holdings Ltd. | 23500 |  | 111665 |
|  CLP Holdings Ltd. | 31500 |  | 211475 |
|  Emera, Inc.(a) | 5460 |  | 202101 |
|  Fortis, Inc.(a) | 8512 |  | 331669 |
|  Hydro One Ltd.(a) (b) | 11032 |  | 276275 |
|  Iberdrola SA | 59668 |  | 605946 |
|  Kansai Electric Power Co., Inc. (The)(a) | 25200 |  | 191075 |
|  Power Assets Holdings Ltd. | 42000 |  | 200908 |
|  Red Electrica Corp. SA(a) | 28448 |  | 459706 |
|  |  |  | **2796136** |
| **Electronic Equipment, Instruments & Components – 0.4%** | **Electronic Equipment, Instruments & Components – 0.4%** | **Electronic Equipment, Instruments & Components – 0.4%** | **Electronic Equipment, Instruments & Components – 0.4%** |
|  Hirose Electric Co. Ltd. | 1900 |  | 246840 |
| **Equity Real Estate Investment Trusts (REITs) – 0.3%** | **Equity Real Estate Investment Trusts (REITs) – 0.3%** | **Equity Real Estate Investment Trusts (REITs) – 0.3%** | **Equity Real Estate Investment Trusts (REITs) – 0.3%** |
|  Link REIT | 35262 |  | 208432 |
| **Food & Staples Retailing – 3.4%** | **Food & Staples Retailing – 3.4%** | **Food & Staples Retailing – 3.4%** | **Food & Staples Retailing – 3.4%** |
|  Carrefour SA | 14644 |  | 235699 |
|  Coles Group Ltd. | 7532 |  | 78651 |
|  Jeronimo Martins SGPS SA | 13188 |  | 273461 |
|  Koninklijke Ahold Delhaize NV | 16912 |  | 472198 |
|  Loblaw Cos. Ltd. | 5376 |  | 439917 |
|  Metro, Inc. | 5236 |  | 273959 |
|  Tesco plc | 132832 |  | 328965 |
|  |  |  | **2102850** |
| **Food Products – 5.8%** | **Food Products – 5.8%** | **Food Products – 5.8%** | **Food Products – 5.8%** |
|  JDE Peet's NV | 6972 |  | 199695 |
|  MEIJI Holdings Co. Ltd. | 5100 |  | 209991 |
|  Nestle SA (Registered) | 26796 |  | 2919646 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Yakult Honsha Co. Ltd.(a) | 4900 | $| 271645 |
|  |  |  | **3600977** |
| **Gas Utilities – 1.1%** | **Gas Utilities – 1.1%** | **Gas Utilities – 1.1%** | **Gas Utilities – 1.1%** |
|  Osaka Gas Co. Ltd. | 14000 |  | 207408 |
|  Snam SpA | 51632 |  | 229739 |
|  Tokyo Gas Co. Ltd. | 14000 |  | 250264 |
|  |  |  | **687411** |
| **Health Care Equipment & Supplies – 0.3%** | **Health Care Equipment & Supplies – 0.3%** | **Health Care Equipment & Supplies – 0.3%** | **Health Care Equipment & Supplies – 0.3%** |
|  ConvaTec Group plc(b) | 39340 |  | 98741 |
|  Fisher & Paykel Healthcare Corp. Ltd. | 4620 |  | 52553 |
|  |  |  | **151294** |
| **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** |
|  La Francaise des Jeux SAEM(b) | 1204 |  | 39269 |
|  McDonald's Holdings Co. Japan Ltd. | 14000 |  | 486023 |
|  |  |  | **525292** |
| **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** |
|  Sekisui Chemical Co. Ltd. | 2800 |  | 35039 |
|  Sekisui House Ltd.(a) | 16800 |  | 279746 |
|  |  |  | **314785** |
| **Household Products – 0.8%** | **Household Products – 0.8%** | **Household Products – 0.8%** | **Household Products – 0.8%** |
|  Reckitt Benckiser Group plc | 7672 |  | 510556 |
| **Industrial Conglomerates – 1.4%** | **Industrial Conglomerates – 1.4%** | **Industrial Conglomerates – 1.4%** | **Industrial Conglomerates – 1.4%** |
|  CK Hutchison Holdings Ltd. | 42000 |  | 208666 |
|  Jardine Matheson Holdings Ltd. | 8400 |  | 386568 |
|  Keppel Corp. Ltd. | 50400 |  | 248243 |
|  |  |  | **843477** |
| **Insurance – 2.1%** | **Insurance – 2.1%** | **Insurance – 2.1%** | **Insurance – 2.1%** |
|  Admiral Group plc | 11144 |  | 258794 |
|  Baloise Holding AG (Registered) | 560 |  | 76551 |
|  Gjensidige Forsikring ASA | 616 |  | 11251 |
|  Intact Financial Corp. | 2940 |  | 446178 |
|  Japan Post Holdings Co. Ltd. | 39200 |  | 263628 |
|  Medibank Pvt Ltd.(a) | 111104 |  | 199638 |
|  Sampo OYJ, Class A | 1372 |  | 62756 |
|  |  |  | **1318796** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 139

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **IT Services – 1.8%** | **IT Services – 1.8%** | **IT Services – 1.8%** |
|  CGI, Inc.\* | 3416 | $274823 |
|  Itochu Techno-Solutions Corp. | 5600 | 129983 |
|  Nomura Research Institute Ltd. | 8400 | 186780 |
|  Obic Co. Ltd. | 3300 | 496659 |
|  |  | **1088245** |
| **Machinery – 1.5%** | **Machinery – 1.5%** | **Machinery – 1.5%** |
|  GEA Group AG | 6524 | 228259 |
|  Kone OYJ, Class B | 11116 | 455390 |
|  Schindler Holding AG | 1372 | 223811 |
|  Schindler Holding AG (Registered) | 224 | 35276 |
|  |  | **942736** |
| **Marine – 0.7%** | **Marine – 0.7%** | **Marine – 0.7%** |
|  Kuehne + Nagel International AG (Registered) | 1876 | 400038 |
| **Metals & Mining – 1.9%** | **Metals & Mining – 1.9%** | **Metals & Mining – 1.9%** |
|  Barrick Gold Corp. | 28448 | 427330 |
|  BHP Group Ltd. | 3136 | 74919 |
|  Franco-Nevada Corp. | 3444 | 425005 |
|  Hitachi Metals Ltd.\* | 16800 | 245498 |
|  |  | **1172752** |
| **Multiline Retail – 1.4%** | **Multiline Retail – 1.4%** | **Multiline Retail – 1.4%** |
|  B&M European Value Retail SA(a) | 14588 | 54184 |
|  Dollarama, Inc. | 3948 | 234295 |
|  Pan Pacific International Holdings Corp. | 2800 | 45984 |
|  Wesfarmers Ltd.(a) | 18312 | 532319 |
|  |  | **866782** |
| **Multi-Utilities – 0.8%** | **Multi-Utilities – 0.8%** | **Multi-Utilities – 0.8%** |
|  Canadian Utilities Ltd., Class A(a) | 2352 | 62505 |
|  National Grid plc | 39732 | 433850 |
|  |  | **496355** |
| **Oil, Gas & Consumable Fuels – 2.5%** | **Oil, Gas & Consumable Fuels – 2.5%** | **Oil, Gas & Consumable Fuels – 2.5%** |
|  ENEOS Holdings, Inc. | 70000 | 230673 |
|  Idemitsu Kosan Co. Ltd. | 9900 | 216470 |
|  Pembina Pipeline Corp. | 8008 | 264066 |
|  Shell plc | 13804 | 382073 |
|  TotalEnergies SE | 700 | 38121 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Woodside Energy Group Ltd. | 17024 | $| 391678 |
|  |  |  | **1523081** |
| **Personal Products – 2.9%** | **Personal Products – 2.9%** | **Personal Products – 2.9%** | **Personal Products – 2.9%** |
|  Beiersdorf AG | 1736 |  | 166739 |
|  Kobayashi Pharmaceutical Co. Ltd. | 6700 |  | 356107 |
|  Unilever plc | 27832 |  | 1273604 |
|  |  |  | **1796450** |
| **Pharmaceuticals – 15.3%** | **Pharmaceuticals – 15.3%** | **Pharmaceuticals – 15.3%** | **Pharmaceuticals – 15.3%** |
|  Astellas Pharma, Inc. | 28000 |  | 385522 |
|  GSK plc | 70112 |  | 1153377 |
|  Hikma Pharmaceuticals plc | 12124 |  | 174347 |
|  Kyowa Kirin Co. Ltd. | 11200 |  | 264110 |
|  Novartis AG (Registered) | 5264 |  | 425538 |
|  Novo Nordisk A/S, Class B | 12544 |  | 1364052 |
|  Ono Pharmaceutical Co. Ltd. | 22400 |  | 526864 |
|  Roche Holding AG | 8820 |  | 2930893 |
|  Roche Holding AG | 112 |  | 45460 |
|  Sanofi | 16016 |  | 1382383 |
|  Takeda Pharmaceutical Co. Ltd. | 20600 |  | 543013 |
|  UCB SA | 3808 |  | 287241 |
|  |  |  | **9482800** |
| **Professional Services – 1.7%** | **Professional Services – 1.7%** | **Professional Services – 1.7%** | **Professional Services – 1.7%** |
|  RELX plc | 6720 |  | 181125 |
|  SGS SA (Registered) | 112 |  | 247223 |
|  Wolters Kluwer NV | 5913 |  | 628534 |
|  |  |  | **1056882** |
| **Real Estate Management & Development – 3.6%** | **Real Estate Management & Development – 3.6%** | **Real Estate Management & Development – 3.6%** | **Real Estate Management & Development – 3.6%** |
|  Capitaland Investment Ltd. | 86800 |  | 184629 |
|  CK Asset Holdings Ltd. | 84000 |  | 464417 |
|  Daito Trust Construction Co. Ltd. | 2800 |  | 277108 |
|  Henderson Land Development Co. Ltd. | 64000 |  | 156701 |
|  PSP Swiss Property AG (Registered) | 3724 |  | 398169 |
|  Sino Land Co. Ltd. | 224000 |  | 239413 |
|  Sun Hung Kai Properties Ltd. | 48000 |  | 516392 |
|  |  |  | **2236829** |
| **Road & Rail – 2.1%** | **Road & Rail – 2.1%** | **Road & Rail – 2.1%** | **Road & Rail – 2.1%** |
|  Aurizon Holdings Ltd. | 117908 |  | 272935 |
|  Canadian National Railway Co. | 4564 |  | 540031 |

---

*See Accompanying Notes to the Financial Statements.* 

140 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  MTR Corp. Ltd. | 51000 | 224469 |
|  Tobu Railway Co. Ltd. | 11200 | 259212 |
|  |  | **1296647** |
| **Semiconductors & Semiconductor Equipment – 0.6%** | **Semiconductors & Semiconductor Equipment – 0.6%** | **Semiconductors & Semiconductor Equipment – 0.6%** |
|  ASML Holding NV | 840 | 396842 |
| **Software – 2.5%** | **Software – 2.5%** | **Software – 2.5%** |
|  Constellation Software, Inc. | 336 | 485234 |
|  Nice Ltd.\* | 1176 | 223806 |
|  Oracle Corp. Japan | 8400 | 448723 |
|  Sage Group plc (The) | 1260 | 10544 |
|  SAP SE | 4200 | 405435 |
|  |  | **1573742** |
| **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** |
|  Industria de Diseno Textil SA(a) | 25900 | 587224 |
|  USS Co. Ltd. | 28000 | 423292 |
|  |  | **1010516** |
| **Technology Hardware, Storage & Peripherals – 1.0%** | **Technology Hardware, Storage & Peripherals – 1.0%** | **Technology Hardware, Storage & Peripherals – 1.0%** |
|  Canon, Inc. | 16800 | 356492 |
|  FUJIFILM Holdings Corp. | 6200 | 284440 |
|  |  | **640932** |
| **Textiles, Apparel & Luxury Goods – 0.9%** | **Textiles, Apparel & Luxury Goods – 0.9%** | **Textiles, Apparel & Luxury Goods – 0.9%** |
|  Hermes International | 140 | 181333 |
|  LVMH Moet Hennessy Louis Vuitton SE | 616 | 389038 |
|  |  | **570371** |
| **Tobacco – 0.5%** | **Tobacco – 0.5%** | **Tobacco – 0.5%** |
|  Japan Tobacco, Inc. | 19600 | 324919 |
| **Trading Companies & Distributors – 1.4%** | **Trading Companies & Distributors – 1.4%** | **Trading Companies & Distributors – 1.4%** |
|  Bunzl plc | 8148 | 266520 |
|  ITOCHU Corp. | 22400 | 580062 |
|  |  | **846582** |
| **Transportation Infrastructure – 0.7%** | **Transportation Infrastructure – 0.7%** | **Transportation Infrastructure – 0.7%** |
|  Atlantia SpA | 18368 | 409918 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Water Utilities – 0.4%** | **Water Utilities – 0.4%** | **Water Utilities – 0.4%** |
|  United Utilities Group plc | 20160 | $218046 |
| **Wireless Telecommunication Services – 2.5%** | **Wireless Telecommunication Services – 2.5%** | **Wireless Telecommunication Services – 2.5%** |
|  KDDI Corp. | 26700 | 789494 |
|  SoftBank Corp. | 44800 | 441716 |
|  Vodafone Group plc | 275100 | 321931 |
|  |  | **1553141** |
| **Total Common Stocks <br>(Cost $66,583,161)** | **Total Common Stocks <br>(Cost $66,583,161)** | **60676378** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** |
| **REPURCHASE AGREEMENTS – 0.8%** | **REPURCHASE AGREEMENTS – 0.8%** | **REPURCHASE AGREEMENTS – 0.8%** |
|  CF Secured LLC, 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $481,376, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2022 –8/15/2052; total market value $488,348 <br>(Cost $481,336) | $481336 | 481336 |
| **Total Investments – 98.9% <br>(Cost $67,064,497)** | **Total Investments – 98.9% <br>(Cost $67,064,497)** | **61157714** |
|  Other assets less liabilities – 1.1% | Other assets less liabilities – 1.1% | 694034 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**61851748** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $2,551,916, collateralized in the form of cash with a value of $481,336 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $1,785,618 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 4.75%, and maturity dates ranging from December 1, 2022 – May 15, 2050 and $467,049 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from April 19, 2023 – June 30, 2120; a total value of $2,734,003.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 141

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (cont.)

------

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $481,336.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*OYJ – Public Limited Company* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of* 

 *investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $2118871 |
|  Aggregate gross unrealized depreciation | (8131697) |
|  Net unrealized depreciation | $(6012826) |
|  Federal income tax cost | $67142963 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI EAFE E-Mini Index | 13 | 12/16/2022 | USD | $1141335 | $(42523) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity<br>Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  CAD | 41862 | Citibank NA | USD | 30528 | 12/21/2022 | $179 |
|  USD | 46892 | Toronto-Dominion Bank (The) | AUD | 70050 | 12/21/2022 | 2025 |
|  USD | 3334 | Toronto-Dominion Bank (The) | CAD | 4439 | 12/21/2022 | 77 |
|  USD | 58725 | Citibank NA | CHF | 56297 | 12/21/2022 | 2122 |
|  USD | 6507 | Morgan Stanley | DKK | 48141 | 12/21/2022 | 88 |
|  USD | 52646 | Citibank NA | EUR | 52141 | 12/21/2022 | 895 |
|  USD | 149287 | JPMorgan Chase Bank | EUR | 148464 | 12/21/2022 | 1933 |
|  USD | 55585 | BNP Paribas SA | ILS | 190343 | 12/21/2022 | 1274 |
|  USD | 176912 | Citibank NA | JPY | 25370958 | 12/21/2022 | 5103 |
|  USD | 27626 | Morgan Stanley | JPY | 3919144 | 12/21/2022 | 1087 |
|  USD | 12791 | Bank of New York | NOK | 131563 | 12/21/2022 | 114 |
|  USD | 37733 | Citibank NA | NZD | 63082 | 12/21/2022 | 1056 |
|  USD | 40310 | JPMorgan Chase Bank | SEK | 433881 | 12/21/2022 | 877 |
|  USD | 20030 | JPMorgan Chase Bank | SGD | 28197 | 12/21/2022 | 98 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation |  | $16928 |
|  HKD | 438274 | Citibank NA | USD | 55922 | 12/21/2022 | $(54) |
|  NZD | 21853 | Morgan Stanley | USD | 12988 | 12/21/2022 | (283) |
|  SGD | 44554 | JPMorgan Chase Bank | USD | 31711 | 12/21/2022 | (217) |
|  USD | 131719 | Toronto-Dominion Bank (The) | GBP | 115442 | 12/21/2022 | (1428) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation |  | $(1982) |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation |  | $14946 |

---

*See Accompanying Notes to the Financial Statements.* 

142 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (cont.)

------

*Abbreviations:* 

*AUD – Australian Dollar* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*DKK – Danish Krone* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*ILS – Israeli Shekel* 

*JPY – Japanese Yen* 

*NOK – Norwegian Krone* 

*NZD – New Zealand Dollar* 

*SEK – Swedish Krona* 

*SGD – Singapore Dollar* 

*USD – US Dollar* 

*FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 2.7 | % |
|  Belgium | 1.2 |  |
|  Canada | 11.4 |  |
|  Denmark | 2.9 |  |
|  Finland | 1.6 |  |
|  France | 6.4 |  |
|  Germany | 3 |  |
|  Hong Kong | 5.7 |  |
|  Israel | 2.7 |  |
|  Italy | 1 |  |
|  Japan | 23.4 |  |
|  Netherlands | 3.9 |  |
|  New Zealand | 0.2 |  |
|  Norway | 0 | <sup>†</sup> |
|  Portugal | 0.4 |  |
|  Singapore | 5.2 |  |
|  Spain | 3.2 |  |
|  Switzerland | 13.4 |  |
|  United Kingdom | 9.8 |  |
|  Other<sup>1</sup> | 1.9 |  |
|  | 100 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.1% |
|  Securities Lending Reinvestments | 0.8 |
|  Others<sup>(1)</sup> | 1.1 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 143

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.2%** | **COMMON STOCKS – 99.2%** | **COMMON STOCKS – 99.2%** |
| **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** |
|  Agility Public Warehousing Co. KSC | 18712 | $47361 |
| **Auto Components – 0.7%** | **Auto Components – 0.7%** | **Auto Components – 0.7%** |
|  Cheng Shin Rubber Industry Co. Ltd. | 60000 | 60144 |
| **Automobiles – 1.4%** | **Automobiles – 1.4%** | **Automobiles – 1.4%** |
|  Bajaj Auto Ltd. | 1472 | 65295 |
|  Hero MotoCorp Ltd. | 1436 | 46437 |
|  |  | **111732** |
| **Banks – 21.9%** | **Banks – 21.9%** | **Banks – 21.9%** |
|  Abu Dhabi Islamic Bank PJSC | 23024 | 59549 |
|  Agricultural Bank of China Ltd., Class H | 252000 | 71910 |
|  Al Rajhi Bank\* | 1712 | 38818 |
|  Axis Bank Ltd. | 320 | 3502 |
|  Banco BBVA Peru SA | 4104 | 1627 |
|  Bank Central Asia Tbk. PT | 25200 | 14218 |
|  Bank of China Ltd., Class H | 284000 | 91533 |
|  Bank of Communications Co. Ltd., Class H | 132000 | 64404 |
|  Boubyan Bank KSCP | 19108 | 50831 |
|  Chang Hwa Commercial Bank Ltd. | 82472 | 42487 |
|  China CITIC Bank Corp. Ltd., Class H | 120000 | 45249 |
|  China Construction Bank Corp., Class H | 280000 | 148742 |
|  China Merchants Bank Co. Ltd., Class H | 500 | 1643 |
|  Commercial International Bank Egypt SAE | 34968 | 46914 |
|  Dubai Islamic Bank PJSC | 33040 | 52352 |
|  E.Sun Financial Holding Co. Ltd. | 60000 | 43200 |
|  First Abu Dhabi Bank PJSC | 1240 | 6043 |
|  First Financial Holding Co. Ltd. | 79565 | 61114 |
|  Hong Leong Bank Bhd. | 800 | 3580 |
|  Hua Nan Financial Holdings Co. Ltd. | 92000 | 60101 |
|  ICICI Bank Ltd. | 984 | 10802 |
|  Industrial & Commercial Bank of China Ltd., Class H | 404000 | 175499 |
|  Itau Unibanco Holding SA (Preference)\* | 1600 | 9270 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Kuwait Finance House KSCP | 36616 | $| 95751 |
|  Malayan Banking Bhd. | 18185 |  | 33039 |
|  Mega Financial Holding Co. Ltd. | 18700 |  | 17352 |
|  National Bank of Kuwait SAKP | 51436 |  | 179009 |
|  Postal Savings Bank of China Co. Ltd., Class H(a) | 84000 |  | 38951 |
|  Qatar Islamic Bank SAQ | 10872 |  | 72813 |
|  Qatar National Bank QPSC | 31904 |  | 174687 |
|  Saudi National Bank (The) | 1312 |  | 20740 |
|  Sberbank of Russia PJSC\* ‡ | 12360 |  |  |
|  Taiwan Cooperative Financial Holding Co. Ltd. | 85933 |  | 66672 |
|  |  |  | **1802402** |
| **Capital Markets – 0.7%** | **Capital Markets – 0.7%** | **Capital Markets – 0.7%** | **Capital Markets – 0.7%** |
|  Macquarie Korea Infrastructure Fund | 7000 |  | 54302 |
| **Chemicals – 2.6%** | **Chemicals – 2.6%** | **Chemicals – 2.6%** | **Chemicals – 2.6%** |
|  Asian Paints Ltd. | 536 |  | 20123 |
|  PhosAgro PJSC‡ | 1158 |  |  |
|  Pidilite Industries Ltd. | 1832 |  | 57197 |
|  SABIC Agri-Nutrients Co. | 1916 |  | 81075 |
|  Saudi Basic Industries Corp. | 748 |  | 17598 |
|  Yanbu National Petrochemical Co. | 3280 |  | 39019 |
|  |  |  | **215012** |
| **Construction Materials – 1.0%** | **Construction Materials – 1.0%** | **Construction Materials – 1.0%** | **Construction Materials – 1.0%** |
|  ACC Ltd. | 676 |  | 19520 |
|  Asia Cement Corp. | 20000 |  | 23152 |
|  LafargeHolcim Maroc SA | 292 |  | 39444 |
|  |  |  | **82116** |
| **Consumer Finance – 0.6%** | **Consumer Finance – 0.6%** | **Consumer Finance – 0.6%** | **Consumer Finance – 0.6%** |
|  Bajaj Finance Ltd. | 84 |  | 7250 |
|  Samsung Card Co. Ltd. | 1856 |  | 40261 |
|  |  |  | **47511** |
| **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** |
|  Far East Horizon Ltd. | 60000 |  | 46319 |
|  Housing Development Finance Corp. Ltd. | 232 |  | 6922 |
|  |  |  | **53241** |

---

*See Accompanying Notes to the Financial Statements.* 

144 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Diversified Telecommunication Services – 5.8%** | **Diversified Telecommunication Services – 5.8%** | **Diversified Telecommunication Services – 5.8%** |
|  China Tower Corp. Ltd., Class H(a) | 600000 | $54268 |
|  Chunghwa Telecom Co. Ltd. | 28000 | 96454 |
|  Emirates Integrated Telecommunications Co. PJSC | 28288 | 44130 |
|  Emirates Telecommunications Group Co. PJSC | 11508 | 80834 |
|  Hellenic Telecommunications Organization SA | 4180 | 65688 |
|  Itissalat Al-Maghrib | 6108 | 56947 |
|  Ooredoo QPSC | 19424 | 52110 |
|  Telefonica Brasil SA | 3200 | 25193 |
|  |  | **475624** |
| **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** |
|  Manila Electric Co. | 8200 | 42648 |
|  Power Grid Corp. of India Ltd. | 28304 | 78011 |
|  Saudi Electricity Co. | 9888 | 71051 |
|  Tenaga Nasional Bhd. | 26000 | 46303 |
|  Transmissora Alianca de Energia Eletrica SA | 5600 | 42892 |
|  |  | **280905** |
| **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** |
|  Hon Hai Precision Industry Co. Ltd. | 2000 | 6362 |
|  WPG Holdings Ltd. | 28000 | 38191 |
|  |  | **44553** |
| **Entertainment – 0.4%** | **Entertainment – 0.4%** | **Entertainment – 0.4%** |
|  NetEase, Inc., ADR | 664 | 36932 |
| **Food & Staples Retailing – 2.2%** | **Food & Staples Retailing – 2.2%** | **Food & Staples Retailing – 2.2%** |
|  InRetail Peru Corp.(a) | 1412 | 48714 |
|  Nahdi Medical Co. | 1256 | 66184 |
|  President Chain Store Corp. | 8000 | 66537 |
|  |  | **181435** |
| **Food Products – 5.1%** | **Food Products – 5.1%** | **Food Products – 5.1%** |
|  Almarai Co. JSC | 3440 | 51542 |
|  Dali Foods Group Co. Ltd.(a) | 104000 | 42793 |
|  Nestle India Ltd. | 116 | 28536 |
|  Nestle Malaysia Bhd. | 2400 | 67513 |
|  Tingyi Cayman Islands Holding Corp. | 48000 | 75089 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Uni-President China Holdings Ltd. | 52000 | $| 38421 |
|  Uni-President Enterprises Corp. | 28000 |  | 56917 |
|  Want Want China Holdings Ltd. | 92000 |  | 60475 |
|  |  |  | **421286** |
| **Gas Utilities – 1.4%** | **Gas Utilities – 1.4%** | **Gas Utilities – 1.4%** | **Gas Utilities – 1.4%** |
|  China Resources Gas Group Ltd. | 11600 |  | 29702 |
|  ENN Energy Holdings Ltd. | 2000 |  | 19886 |
|  Petronas Gas Bhd. | 18800 |  | 67995 |
|  |  |  | **117583** |
| **Health Care Providers & Services – 4.4%** | **Health Care Providers & Services – 4.4%** | **Health Care Providers & Services – 4.4%** | **Health Care Providers & Services – 4.4%** |
|  Bangkok Dusit Medical Services PCL, NVDR | 105600 |  | 81850 |
|  Bumrungrad Hospital PCL, NVDR | 13600 |  | 81114 |
|  Dr Sulaiman Al Habib Medical Services Group Co. | 940 |  | 56687 |
|  IHH Healthcare Bhd. | 42000 |  | 52855 |
|  Mouwasat Medical Services Co. | 812 |  | 47326 |
|  Sinopharm Group Co. Ltd., Class H | 22400 |  | 42689 |
|  |  |  | **362521** |
| **Hotels, Restaurants & Leisure – 0.3%** | **Hotels, Restaurants & Leisure – 0.3%** | **Hotels, Restaurants & Leisure – 0.3%** | **Hotels, Restaurants & Leisure – 0.3%** |
|  Kangwon Land, Inc.\* | 728 |  | 11755 |
|  Yum China Holdings, Inc. | 308 |  | 12736 |
|  |  |  | **24491** |
| **Household Durables – 0.7%** | **Household Durables – 0.7%** | **Household Durables – 0.7%** | **Household Durables – 0.7%** |
|  Coway Co. Ltd. | 1504 |  | 58388 |
| **Independent Power and Renewable Electricity<br>Producers – 0.1%** | **Independent Power and Renewable Electricity<br>Producers – 0.1%** | **Independent Power and Renewable Electricity<br>Producers – 0.1%** | **Independent Power and Renewable Electricity<br>Producers – 0.1%** |
|  Engie Brasil Energia SA | 1200 |  | 9198 |
|  Unipro PJSC‡ | 726000 |  |  |
|  |  |  | **9198** |
| **Industrial Conglomerates – 2.3%** | **Industrial Conglomerates – 2.3%** | **Industrial Conglomerates – 2.3%** | **Industrial Conglomerates – 2.3%** |
|  Alpha Dhabi Holding PJSC\* | 7676 |  | 51200 |
|  International Holding Co. PJSC\* | 1268 |  | 139123 |
|  |  |  | **190323** |
| **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** |
|  Tencent Holdings Ltd. | 8400 |  | 220009 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 145

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Internet & Direct Marketing Retail – 2.7%** | **Internet & Direct Marketing Retail – 2.7%** | **Internet & Direct Marketing Retail – 2.7%** |
|  Alibaba Group Holding Ltd., ADR\* | 3040 | $193283 |
|  JD.com, Inc., ADR | 676 | 25208 |
|  Pinduoduo, Inc., ADR\* | 48 | 2632 |
|  |  | **221123** |
| **IT Services – 4.4%** | **IT Services – 4.4%** | **IT Services – 4.4%** |
|  Infosys Ltd. | 3448 | 64049 |
|  Samsung SDS Co. Ltd. | 668 | 58619 |
|  Tata Consultancy Services Ltd. | 6188 | 238703 |
|  |  | **361371** |
| **Life Sciences Tools & Services – 0.1%** | **Life Sciences Tools & Services – 0.1%** | **Life Sciences Tools & Services – 0.1%** |
|  Samsung Biologics Co. Ltd.\* (a) | 12 | 7388 |
| **Marine – 0.5%** | **Marine – 0.5%** | **Marine – 0.5%** |
|  MISC Bhd. | 28800 | 44041 |
| **Metals & Mining – 0.5%** | **Metals & Mining – 0.5%** | **Metals & Mining – 0.5%** |
|  Polyus PJSC\* ‡ | 546 |  |
|  Vale SA | 3200 | 40939 |
|  |  | **40939** |
| **Multiline Retail – 0.0%** | **Multiline Retail – 0.0%** | **Multiline Retail – 0.0%** |
|  Robinson PCL\* ‡ | 600 |  |
| **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** |
|  Dubai Electricity & Water Authority PJSC | 77832 | 51704 |
|  Qatar Electricity & Water Co. QSC | 9080 | 46126 |
|  |  | **97830** |
| **Oil, Gas & Consumable Fuels – 2.9%** | **Oil, Gas & Consumable Fuels – 2.9%** | **Oil, Gas & Consumable Fuels – 2.9%** |
|  Petroleo Brasileiro SA | 1200 | 7606 |
|  Petroleo Brasileiro SA (Preference) | 2000 | 11362 |
|  Petronas Dagangan Bhd. | 9600 | 44020 |
|  Petronet LNG Ltd. | 1036 | 2573 |
|  Qatar Fuel QSC | 9760 | 51135 |
|  Qatar Gas Transport Co. Ltd. | 45468 | 51189 |
|  Reliance Industries Ltd. | 2268 | 69856 |
|  Surgutneftegas PJSC (Preference)‡ | 156600 |  |
|  |  | **237741** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Personal Products – 1.7%** | **Personal Products – 1.7%** | **Personal Products – 1.7%** |
|  Colgate-Palmolive India Ltd. | 3648 | $71911 |
|  Hengan International Group Co. Ltd. | 14000 | 54307 |
|  Hindustan Unilever Ltd. | 328 | 10107 |
|  |  | **136325** |
| **Pharmaceuticals – 4.1%** | **Pharmaceuticals – 4.1%** | **Pharmaceuticals – 4.1%** |
|  Cipla Ltd. | 6008 | 84730 |
|  Dr Reddy's Laboratories Ltd. | 556 | 29780 |
|  Lupin Ltd. | 1360 | 11484 |
|  Richter Gedeon Nyrt. | 2216 | 43689 |
|  Sun Pharmaceutical Industries Ltd. | 3940 | 48402 |
|  Torrent Pharmaceuticals Ltd. | 3700 | 73752 |
|  Yuhan Corp. | 1088 | 45676 |
|  |  | **337513** |
| **Real Estate Management & Development – 1.0%** | **Real Estate Management & Development – 1.0%** | **Real Estate Management & Development – 1.0%** |
|  Aldar Properties PJSC | 38300 | 45046 |
|  Wharf Holdings Ltd. (The) | 12000 | 34319 |
|  |  | **79365** |
| **Semiconductors & Semiconductor Equipment – 5.0%** | **Semiconductors & Semiconductor Equipment – 5.0%** | **Semiconductors & Semiconductor Equipment – 5.0%** |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 34000 | 411514 |
| **Specialty Retail – 4.4%** | **Specialty Retail – 4.4%** | **Specialty Retail – 4.4%** |
|  Abu Dhabi National Oil Co. for Distribution PJSC | 60380 | 74138 |
|  Home Product Center PCL, NVDR | 188400 | 72271 |
|  Hotel Shilla Co. Ltd. | 1276 | 58226 |
|  Jarir Marketing Co. | 1536 | 67040 |
|  MR DIY Group M Bhd.(a) | 105200 | 44946 |
|  PTT Oil & Retail Business PCL, NVDR | 17200 | 10891 |
|  Zhongsheng Group Holdings Ltd. | 8000 | 30370 |
|  |  | **357882** |
| **Technology Hardware, Storage & Peripherals – 4.3%** | **Technology Hardware, Storage & Peripherals – 4.3%** | **Technology Hardware, Storage & Peripherals – 4.3%** |
|  Compal Electronics, Inc. | 64000 | 41909 |
|  Inventec Corp. | 60000 | 45434 |
|  Lite-On Technology Corp. | 6000 | 11917 |
|  Pegatron Corp. | 16000 | 29296 |
|  Samsung Electronics Co. Ltd. | 5300 | 221012 |
|  |  | **349568** |

---

*See Accompanying Notes to the Financial Statements.* 

146 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Textiles, Apparel & Luxury Goods – 0.3%** | **Textiles, Apparel & Luxury Goods – 0.3%** | **Textiles, Apparel & Luxury Goods – 0.3%** |
|  Page Industries Ltd. | 40 | $24049 |
| **Tobacco – 1.0%** | **Tobacco – 1.0%** | **Tobacco – 1.0%** |
|  KT&G Corp. | 1244 | 83577 |
| **Transportation Infrastructure – 1.3%** | **Transportation Infrastructure – 1.3%** | **Transportation Infrastructure – 1.3%** |
|  Taiwan High Speed Rail Corp. | 52000 | 45347 |
|  Westports Holdings Bhd. | 82000 | 58274 |
|  |  | **103621** |
| **Wireless Telecommunication Services – 4.4%** | **Wireless Telecommunication Services – 4.4%** | **Wireless Telecommunication Services – 4.4%** |
|  Advanced Info Service PCL, NVDR | 14400 | 72265 |
|  Bharti Airtel Ltd. | 164 | 1648 |
|  Etihad Etisalat Co. | 4708 | 45858 |
|  Far EasTone Telecommunications Co. Ltd. | 30000 | 65824 |
|  Intouch Holdings PCL, NVDR | 34400 | 65076 |
|  PLDT, Inc. | 480 | 13534 |
|  Taiwan Mobile Co. Ltd. | 24000 | 70832 |
|  Vodacom Group Ltd. | 3768 | 25693 |
|  |  | **360730** |
| **Total Common Stocks <br>(Cost $9,468,208)** | **Total Common Stocks <br>(Cost $9,468,208)** | **8151646** |
| **Total Investments – 99.2% <br>(Cost $9,468,208)** | **Total Investments – 99.2% <br>(Cost $9,468,208)** | **8151646** |
| **Other assets less liabilities – 0.8%** | **Other assets less liabilities – 0.8%** | **62246** |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**8213892** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*NVDR – Non-Voting Depositary Receipt* 

*PJSC – Public Joint Stock Company* 

*Preference A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $524791 |
|  Aggregate gross unrealized depreciation | (1944828) |
|  Net unrealized depreciation | $(1420037) |
|  Federal income tax cost | $9564014 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |  |
|  MSCI Emerging Markets E-Mini Index | 2 | 12/16/2022 | USD | $85360 | $(7669) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 147

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund (cont.)

------

*FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Brazil | 1.8% |
|  China | 20.2 |
|  Egypt | 0.6 |
|  Greece | 0.8 |
|  Hungary | 0.5 |
|  India | 13.1 |
|  Indonesia | 0.2 |
|  Kuwait | 4.5 |
|  Malaysia | 5.6 |
|  Morocco | 1.2 |
|  Peru | 0.6 |
|  Philippines | 0.7 |
|  Qatar | 5.4 |
|  Saudi Arabia | 7.3 |
|  South Africa | 0.3 |
|  South Korea | 7.8 |
|  Taiwan | 16.6 |
|  Thailand | 4.7 |
|  United Arab Emirates | 7.3 |
|  Other<sup>1</sup> | 0.8 |
|  | 100.0% |

---

*<sup>1</sup>* *Includes any non-equity securities and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.2% |
|  Others<sup>(1)</sup> | 0.8 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

148 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.1%** | **COMMON STOCKS – 99.1%** | **COMMON STOCKS – 99.1%** |
| **Aerospace & Defense – 1.6%** | **Aerospace & Defense – 1.6%** | **Aerospace & Defense – 1.6%** |
|  AAR Corp.\* | 2790 | $123653 |
|  Aerojet Rocketdyne Holdings, Inc.\* | 3906 | 189246 |
|  AeroVironment, Inc.\* | 1302 | 119133 |
|  Axon Enterprise, Inc.\* (a) | 1674 | 243467 |
|  Boeing Co. (The)\* | 14245 | 2030055 |
|  BWX Technologies, Inc. | 4278 | 243760 |
|  Curtiss-Wright Corp.(a) | 2590 | 434680 |
|  Ducommun, Inc.\* | 558 | 26343 |
|  General Dynamics Corp. | 7254 | 1812049 |
|  HEICO Corp.(a) | 1480 | 240707 |
|  HEICO Corp., Class A | 1860 | 236778 |
|  Hexcel Corp. | 3330 | 185481 |
|  Howmet Aerospace, Inc. | 11840 | 420912 |
|  Huntington Ingalls Industries, Inc. | 1302 | 334705 |
|  Kaman Corp. | 2046 | 65677 |
|  Kratos Defense & Security Solutions, Inc.\* | 4278 | 47400 |
|  L3Harris Technologies, Inc.(a) | 6324 | 1558676 |
|  Lockheed Martin Corp.(a) | 7626 | 3711422 |
|  Maxar Technologies, Inc. | 4836 | 108036 |
|  Mercury Systems, Inc.\* (a) | 4278 | 207055 |
|  Moog, Inc., Class A | 7068 | 599013 |
|  Northrop Grumman Corp. | 4836 | 2655012 |
|  Parsons Corp.\* (a) | 3523 | 165158 |
|  Raytheon Technologies Corp. | 47987 | 4550127 |
|  Spirit AeroSystems Holdings, Inc., Class A | 4464 | 103386 |
|  Textron, Inc. | 6660 | 455810 |
|  TransDigm Group, Inc. | 1302 | 749640 |
|  Triumph Group, Inc.\* | 7068 | 63965 |
|  V2X, Inc.\* | 3348 | 137235 |
|  Virgin Galactic Holdings, Inc.\* (a) | 10230 | 47263 |
|  Woodward, Inc.(a) | 3348 | 307012 |
|  |  | **22172856** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** |
|  Air Transport Services Group, Inc.\* (a) | 15725 | $459170 |
|  Atlas Air Worldwide Holdings, Inc.\* (a) | 6595 | 667018 |
|  CH Robinson Worldwide, Inc. | 3906 | 381695 |
|  Expeditors International of Washington, Inc.(a) | 4278 | 418602 |
|  FedEx Corp. | 7626 | 1222295 |
|  Forward Air Corp. | 930 | 98459 |
|  GXO Logistics, Inc.\* (a) | 1674 | 61168 |
|  Hub Group, Inc., Class A\* (a) | 8510 | 660376 |
|  United Parcel Service, Inc., Class B | 23994 | 4025474 |
|  |  | **7994257** |
| **Airlines – 0.3%** |  |  |
|  Alaska Air Group, Inc.\* (a) | 28272 | 1256973 |
|  Allegiant Travel Co.\* | 930 | 69796 |
|  American Airlines Group, Inc.\* (a) | 16465 | 233474 |
|  Delta Air Lines, Inc.\* | 20274 | 687897 |
|  Frontier Group Holdings, Inc.\* | 7668 | 100527 |
|  Hawaiian Holdings, Inc.\* (a) | 16368 | 236190 |
|  JetBlue Airways Corp.\* | 69748 | 560774 |
|  SkyWest, Inc.\* | 5208 | 92077 |
|  Southwest Airlines Co.\* | 16368 | 594977 |
|  Spirit Airlines, Inc. | 4092 | 90024 |
|  Sun Country Airlines Holdings, Inc.\* | 2232 | 36337 |
|  United Airlines Holdings, Inc.\* (a) | 6845 | 294883 |
|  Wheels Up Experience, Inc.\* (a) | 62309 | 110287 |
|  |  | **4364216** |
| **Auto Components – 0.5%** | **Auto Components – 0.5%** | **Auto Components – 0.5%** |
|  Adient plc\* (a) | 21018 | 735210 |
|  American Axle & Manufacturing Holdings, Inc.\* (a) | 19902 | 192850 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 149

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** |
|  Aptiv plc\* (a) | 7626 | $694500 |
|  Autoliv, Inc. | 4278 | 343737 |
|  BorgWarner, Inc.(a) | 5920 | 222178 |
|  Dana, Inc. | 30504 | 486844 |
|  Dorman Products, Inc.\* | 1860 | 151813 |
|  Fox Factory Holding Corp.\* | 2976 | 261442 |
|  Garrett Motion, Inc.\* (a) | 9858 | 65457 |
|  Gentex Corp. | 8556 | 226648 |
|  Gentherm, Inc.\* (a) | 1116 | 65197 |
|  Goodyear Tire & Rubber Co. (The)\* | 62867 | 798411 |
|  LCI Industries(a) | 5580 | 592094 |
|  Lear Corp. | 1488 | 206401 |
|  Luminar Technologies, Inc.\* (a) | 11718 | 94799 |
|  Modine Manufacturing Co.\* | 9300 | 166656 |
|  Patrick Industries, Inc. | 4836 | 221054 |
|  QuantumScape Corp.\* (a) | 61007 | 508188 |
|  Standard Motor Products, Inc. | 5766 | 218704 |
|  Stoneridge, Inc.\* (a) | 7254 | 151391 |
|  Tenneco, Inc., Class A\* (a) | 16926 | 333442 |
|  Visteon Corp.\* | 2035 | 265506 |
|  XPEL, Inc.\* (a) (b) | 1302 | 90085 |
|  |  | **7092607** |
| **Automobiles – 1.7%** |  |  |
|  Ford Motor Co. | 130941 | 1750681 |
|  General Motors Co. | 48359 | 1898091 |
|  Harley-Davidson, Inc. | 29946 | 1287678 |
|  Lordstown Motors Corp.\* (a) | 48917 | 88540 |
|  Lucid Group, Inc.\* (a) | 15810 | 225925 |
|  Mullen Automotive, Inc.\* (a) | 81652 | 38899 |
|  Rivian Automotive, Inc., Class A\* (a) | 16280 | 569311 |
|  Tesla, Inc.\* | 70300 | 15996062 |
|  Thor Industries, Inc.(a) | 11470 | 934461 |
|  Winnebago Industries, Inc.(a) | 7440 | 444093 |
|  Workhorse Group, Inc.\* (a) | 10044 | 27119 |
|  |  | **23260860** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – 6.5%** |  |  |
|  1st Source Corp. | 5180 | $301269 |
|  Ameris Bancorp(a) | 13950 | 718565 |
|  Associated Banc-Corp. | 30525 | 743284 |
|  Atlantic Union Bankshares Corp.(a) | 14800 | 511192 |
|  Banc of California, Inc. | 3720 | 62050 |
|  BancFirst Corp.(a) | 1670 | 160019 |
|  Bancorp, Inc. (The)\* | 6138 | 169286 |
|  Bank of America Corp. | 228660 | 8240906 |
|  Bank of Hawaii Corp.(a) | 2418 | 183647 |
|  Bank OZK(a) | 26825 | 1152939 |
|  BankUnited, Inc.(a) | 19630 | 705699 |
|  Banner Corp.(a) | 6475 | 484006 |
|  Berkshire Hills Bancorp, Inc.(a) | 3906 | 114251 |
|  BOK Financial Corp.(a) | 7068 | 778823 |
|  Brookline Bancorp, Inc. | 13020 | 179025 |
|  Cadence Bank(a) | 38480 | 1063972 |
|  Cathay General Bancorp | 15170 | 691752 |
|  Central Pacific Financial Corp. | 3906 | 80151 |
|  Citigroup, Inc. | 64169 | 2942790 |
|  Citizens Financial Group, Inc.(a) | 15252 | 623807 |
|  City Holding Co.(a) | 372 | 37516 |
|  Columbia Banking System, Inc.(a) | 18042 | 603866 |
|  Comerica, Inc. | 5208 | 367164 |
|  Commerce Bancshares, Inc.(a) | 3162 | 223996 |
|  Community Bank System, Inc.(a) | 1665 | 103946 |
|  Community Trust Bancorp, Inc. | 2046 | 96755 |
|  ConnectOne Bancorp, Inc. | 4278 | 107164 |
|  Cullen/Frost Bankers, Inc.(a) | 2046 | 317232 |
|  Customers Bancorp, Inc.\* | 5766 | 194257 |
|  CVB Financial Corp.(a) | 9864 | 283294 |
|  Dime Community Bancshares, Inc.(a) | 9620 | 332179 |
|  Eagle Bancorp, Inc.(a) | 6138 | 277929 |
|  East West Bancorp, Inc.(a) | 5580 | 399361 |
|  Eastern Bankshares, Inc. | 6138 | 117665 |

---

*See Accompanying Notes to the Financial Statements.* 

150 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** |  |  |
|  Enterprise Financial Services Corp.(a) | 3515 | $187947 |
|  Farmers National Banc Corp. | 11904 | 163561 |
|  FB Financial Corp. | 1302 | 54632 |
|  Fifth Third Bancorp | 23994 | 856346 |
|  Financial Institutions, Inc. | 4278 | 101945 |
|  First Bancorp/NC(a) | 3534 | 157510 |
|  First Bancorp/PR(a) | 47753 | 754020 |
|  First Bancshares, Inc. (The)(a) | 3162 | 103524 |
|  First Busey Corp. | 14322 | 378244 |
|  First Citizens BancShares, Inc., Class A(a) | 372 | 305829 |
|  First Commonwealth Financial Corp.(a) | 25296 | 362745 |
|  First Financial Bancorp(a) | 18786 | 489751 |
|  First Financial Bankshares, Inc.(a) | 6696 | 257729 |
|  First Financial Corp. | 3720 | 180383 |
|  First Foundation, Inc.(a) | 5208 | 83120 |
|  First Hawaiian, Inc.(a) | 27528 | 704166 |
|  First Horizon Corp. | 20720 | 507847 |
|  First Interstate BancSystem, Inc., Class A(a) | 18786 | 856829 |
|  First Merchants Corp. | 13206 | 592949 |
|  First of Long Island Corp. (The) | 8370 | 147145 |
|  First Republic Bank | 4836 | 580804 |
|  Flushing Financial Corp.(a) | 5394 | 106262 |
|  FNB Corp.(a) | 73260 | 1058607 |
|  Fulton Financial Corp.(a) | 33480 | 610340 |
|  German American Bancorp, Inc.(a) | 3433 | 134883 |
|  Glacier Bancorp, Inc.(a) | 5952 | 340931 |
|  Hancock Whitney Corp.(a) | 19158 | 1070357 |
|  Hanmi Financial Corp.(a) | 7812 | 209205 |
|  HarborOne Bancorp, Inc. | 2046 | 31161 |
|  Heartland Financial USA, Inc. | 9114 | 449502 |
|  Heritage Commerce Corp.(a) | 9250 | 132275 |
|  Heritage Financial Corp.(a) | 5952 | 200523 |
|  Hilltop Holdings, Inc.(a) | 13133 | 380200 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** |  |  |
|  Home BancShares, Inc.(a) | 40547 | $1033543 |
|  HomeStreet, Inc. | 3162 | 82086 |
|  Hope Bancorp, Inc.(a) | 27528 | 373555 |
|  Horizon Bancorp, Inc. | 6696 | 99837 |
|  Huntington Bancshares, Inc. | 46685 | 708678 |
|  Independent Bank Corp. – MA | 2418 | 210390 |
|  Independent Bank Corp. – MI | 7030 | 162604 |
|  Independent Bank Group, Inc. | 8695 | 548568 |
|  International Bancshares Corp. | 13392 | 664243 |
|  JPMorgan Chase & Co. | 96346 | 12128034 |
|  KeyCorp(a) | 33666 | 601611 |
|  Lakeland Bancorp, Inc.(a) | 12090 | 225479 |
|  Lakeland Financial Corp. | 744 | 61492 |
|  Live Oak Bancshares, Inc.(a) | 930 | 30197 |
|  M&T Bank Corp.(a) | 6218 | 1046925 |
|  Mercantile Bank Corp. | 4464 | 156017 |
|  Midland States Bancorp, Inc. | 4836 | 135601 |
|  National Bank Holdings Corp., Class A | 1116 | 48903 |
|  NBT Bancorp, Inc.(a) | 7998 | 379025 |
|  Nicolet Bankshares, Inc.\* (a) | 1619 | 123514 |
|  Northwest Bancshares, Inc.(a) | 4650 | 70029 |
|  OceanFirst Financial Corp. | 15810 | 356990 |
|  OFG Bancorp | 13505 | 376519 |
|  Old National Bancorp(a) | 61975 | 1212231 |
|  Pacific Premier Bancorp, Inc.(a) | 20274 | 738176 |
|  PacWest Bancorp(a) | 26970 | 670474 |
|  Park National Corp.(a) | 372 | 54870 |
|  Pathward Financial, Inc.(a) | 2976 | 125081 |
|  Peoples Bancorp, Inc. | 5952 | 180167 |
|  Pinnacle Financial Partners, Inc.(a) | 4650 | 385904 |
|  PNC Financial Services Group, Inc. (The) | 13135 | 2125637 |
|  Popular, Inc.(a) | 17760 | 1255987 |
|  Preferred Bank | 1790 | 137597 |
|  Premier Financial Corp. | 10974 | 316600 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 151

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** |  |  |
|  Prosperity Bancshares, Inc.(a) | 20832 | $1490946 |
|  QCR Holdings, Inc.(a) | 2046 | 103753 |
|  Regions Financial Corp.(a) | 33300 | 730935 |
|  Renasant Corp. | 10545 | 425702 |
|  S&T Bancorp, Inc. | 7955 | 300779 |
|  Sandy Spring Bancorp, Inc.(a) | 9114 | 323000 |
|  Seacoast Banking Corp. of Florida(a) | 5022 | 155180 |
|  ServisFirst Bancshares, Inc.(a) | 1665 | 125424 |
|  Signature Bank | 1860 | 294866 |
|  Silvergate Capital Corp., Class A\* (a) | 1116 | 63344 |
|  Simmons First National Corp., Class A | 26970 | 643774 |
|  Southside Bancshares, Inc.(a) | 744 | 25475 |
|  SouthState Corp. | 16280 | 1472200 |
|  Stellar Bancorp, Inc. | 3675 | 120687 |
|  Stock Yards Bancorp, Inc.(a) | 558 | 43630 |
|  SVB Financial Group\* | 1488 | 343668 |
|  Synovus Financial Corp. | 32178 | 1282293 |
|  Texas Capital Bancshares, Inc.\* (a) | 10175 | 610500 |
|  Tompkins Financial Corp.(a) | 186 | 15408 |
|  Towne Bank | 14136 | 465640 |
|  TriCo Bancshares(a) | 558 | 32314 |
|  Triumph Bancorp, Inc.\* (a) | 558 | 28737 |
|  Truist Financial Corp. | 43709 | 1957726 |
|  Trustmark Corp. | 5576 | 203914 |
|  UMB Financial Corp. | 9065 | 754389 |
|  Umpqua Holdings Corp. | 44955 | 893705 |
|  United Bankshares, Inc.(a) | 30132 | 1276090 |
|  United Community Banks, Inc.(a) | 21830 | 840455 |
|  Univest Financial Corp. | 5952 | 167489 |
|  US Bancorp | 44639 | 1894926 |
|  Valley National Bancorp(a) | 94300 | 1119341 |
|  Veritex Holdings, Inc.(a) | 4650 | 146847 |
|  Washington Federal, Inc. | 17020 | 658674 |
|  Washington Trust Bancorp, Inc.(a) | 2389 | 115866 |
|  Webster Financial Corp. | 7343 | 398431 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** |  |  |
|  Wells Fargo & Co. | 123580 | $5683444 |
|  WesBanco, Inc. | 12834 | 519007 |
|  Westamerica Bancorp(a) | 2604 | 163349 |
|  Western Alliance Bancorp | 4092 | 274860 |
|  Wintrust Financial Corp. | 13578 | 1271172 |
|  Zions Bancorp NA | 6105 | 317094 |
|  |  | **90502627** |
| **Beverages – 1.3%** |  |  |
|  Boston Beer Co., Inc. (The), Class A\* (a) | 558 | 208296 |
|  Brown-Forman Corp., Class A(a) | 1488 | 102330 |
|  Brown-Forman Corp., Class B | 5580 | 379440 |
|  Celsius Holdings, Inc.\* (a) | 2046 | 186350 |
|  Coca-Cola Co. (The) | 103228 | 6178196 |
|  Coca-Cola Consolidated, Inc. | 930 | 452919 |
|  Constellation Brands, Inc., Class A | 4440 | 1097035 |
|  Keurig Dr Pepper, Inc.(a) | 26270 | 1020327 |
|  MGP Ingredients, Inc. | 185 | 20729 |
|  Molson Coors Beverage Co., Class B(a) | 6882 | 347059 |
|  Monster Beverage Corp.\* | 10230 | 958755 |
|  National Beverage Corp.(a) | 1116 | 52921 |
|  PepsiCo, Inc. | 36641 | 6653273 |
|  Vintage Wine Estates, Inc.\* | 1302 | 3606 |
|  Vita Coco Co., Inc. (The)\* | 5580 | 57251 |
|  |  | **17718487** |
| **Biotechnology – 2.9%** |  |  |
|  4D Molecular Therapeutics, Inc.\* (a) | 2232 | 19329 |
|  AbbVie, Inc. | 57845 | 8468508 |
|  ACADIA Pharmaceuticals, Inc.\* (a) | 9300 | 149079 |
|  Agios Pharmaceuticals, Inc.\* (a) | 5100 | 140454 |
|  Alector, Inc.\* (a) | 5208 | 47914 |
|  Alkermes plc\* | 9486 | 215332 |
|  Allogene Therapeutics, Inc.\* (a) | 186 | 1916 |

---

*See Accompanying Notes to the Financial Statements.* 

152 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  Alnylam Pharmaceuticals, Inc.\* (a) | 3330 | $690176 |
|  Amgen, Inc. | 17856 | 4827370 |
|  Amicus Therapeutics, Inc.\* (a) | 7254 | 72540 |
|  Anavex Life Sciences Corp.\* (a) | 21018 | 255789 |
|  Apellis Pharmaceuticals, Inc.\* (a) | 5735 | 346910 |
|  Arcturus Therapeutics Holdings, Inc.\* (a) | 930 | 16461 |
|  Arcus Biosciences, Inc.\* (a) | 11532 | 293835 |
|  Arrowhead Pharmaceuticals, Inc.\* (a) | 4836 | 168341 |
|  Atara Biotherapeutics, Inc.\* (a) | 186 | 867 |
|  Avid Bioservices, Inc.\* (a) | 1488 | 25207 |
|  Avidity Biosciences, Inc.\* | 2232 | 31873 |
|  Beam Therapeutics, Inc.\* (a) | 12090 | 532685 |
|  BioCryst Pharmaceuticals, Inc.\* (a) | 14694 | 196165 |
|  Biogen, Inc.\* | 5022 | 1423436 |
|  BioMarin Pharmaceutical, Inc.\* | 5180 | 448743 |
|  Bioxcel Therapeutics, Inc.\* (a) | 5766 | 72594 |
|  Blueprint Medicines Corp.\* | 4092 | 212129 |
|  Bridgebio Pharma, Inc.\* (a) | 4092 | 42680 |
|  CareDx, Inc.\* (a) | 2604 | 51846 |
|  Caribou Biosciences, Inc.\* (a) | 1302 | 12681 |
|  Catalyst Pharmaceuticals, Inc.\* | 9948 | 137979 |
|  Celldex Therapeutics, Inc.\* (a) | 1488 | 52273 |
|  Cerevel Therapeutics Holdings, Inc.\* (a) | 3162 | 88410 |
|  Coherus Biosciences, Inc.\* (a) | 7998 | 69583 |
|  Crinetics Pharmaceuticals, Inc.\* (a) | 5208 | 96140 |
|  CRISPR Therapeutics AG\* (a) | 18685 | 977973 |
|  Cytokinetics, Inc.\* (a) | 5180 | 226159 |
|  Deciphera Pharmaceuticals, Inc.\* | 3162 | 51288 |
|  Denali Therapeutics, Inc.\* (a) | 7400 | 212232 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  Dynavax Technologies Corp.\* (a) | 27714 | $317325 |
|  Editas Medicine, Inc.\* (a) | 1488 | 18674 |
|  Emergent BioSolutions, Inc.\* | 11285 | 235405 |
|  Enanta Pharmaceuticals, Inc.\* (a) | 1860 | 83905 |
|  Exact Sciences Corp.\* (a) | 4650 | 161727 |
|  Exelixis, Inc.\* | 18972 | 314556 |
|  Fate Therapeutics, Inc.\* (a) | 4092 | 85605 |
|  FibroGen, Inc.\* | 3348 | 54505 |
|  Geron Corp.\* | 16182 | 35924 |
|  Gilead Sciences, Inc. | 40330 | 3164292 |
|  Gossamer Bio, Inc.\* (a) | 1302 | 14452 |
|  Halozyme Therapeutics, Inc.\* (a) | 6510 | 311243 |
|  Heron Therapeutics, Inc.\* (a) | 372 | 1432 |
|  Horizon Therapeutics plc\* | 5180 | 322818 |
|  ImmunoGen, Inc.\* (a) | 21762 | 129266 |
|  Incyte Corp.\* | 4255 | 316317 |
|  Inhibrx, Inc.\* (a) | 558 | 17956 |
|  Insmed, Inc.\* (a) | 6324 | 109532 |
|  Intellia Therapeutics, Inc.\* (a) | 4278 | 225793 |
|  Intercept Pharmaceuticals, Inc.\* | 6882 | 95453 |
|  Ionis Pharmaceuticals, Inc.\* (a) | 7440 | 328848 |
|  Iovance Biotherapeutics, Inc.\* | 2976 | 27796 |
|  Ironwood Pharmaceuticals, Inc.\* (a) | 23680 | 259059 |
|  IVERIC bio, Inc.\* | 8695 | 207984 |
|  Karuna Therapeutics, Inc.\* (a) | 1674 | 367175 |
|  Karyopharm Therapeutics, Inc.\* | 7254 | 34529 |
|  Keros Therapeutics, Inc.\* (a) | 744 | 37453 |
|  Krystal Biotech, Inc.\* (a) | 5208 | 398412 |
|  Kura Oncology, Inc.\* (a) | 18685 | 289991 |
|  Kymera Therapeutics, Inc.\* | 186 | 5643 |
|  Ligand Pharmaceuticals, Inc.\* (a) | 744 | 65212 |
|  MacroGenics, Inc.\* (a) | 186 | 952 |
|  Madrigal Pharmaceuticals, Inc.\* (a) | 930 | 65863 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 153

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  MannKind Corp.\* (a) | 7812 | $26405 |
|  MeiraGTx Holdings plc\* (a) | 5208 | 37862 |
|  Mirati Therapeutics, Inc.\* (a) | 3162 | 212866 |
|  Moderna, Inc.\* (a) | 11160 | 1677683 |
|  Myriad Genetics, Inc.\* | 3162 | 65580 |
|  Natera, Inc.\* | 5394 | 253302 |
|  Neurocrine Biosciences, Inc.\* | 2232 | 256948 |
|  Novavax, Inc.\* (a) | 18600 | 414222 |
|  Ocugen, Inc.\* (a) | 67703 | 116449 |
|  Organogenesis Holdings, Inc.\* | 1674 | 5491 |
|  Prometheus Biosciences, Inc.\* (a) | 1850 | 97162 |
|  Protagonist Therapeutics, Inc.\* | 1674 | 13559 |
|  Prothena Corp. plc\* | 1488 | 91423 |
|  PTC Therapeutics, Inc.\* (a) | 3534 | 133656 |
|  Recursion Pharmaceuticals, Inc., Class A\* (a) | 1302 | 13736 |
|  Regeneron Pharmaceuticals, Inc.\* | 3534 | 2646082 |
|  REGENXBIO, Inc.\* (a) | 9858 | 233339 |
|  Relay Therapeutics, Inc.\* | 4650 | 103323 |
|  Replimune Group, Inc.\* | 10788 | 198068 |
|  REVOLUTION Medicines, Inc.\* (a) | 4278 | 86672 |
|  Rigel Pharmaceuticals, Inc.\* | 20088 | 14636 |
|  Rocket Pharmaceuticals, Inc.\* (a) | 14136 | 263778 |
|  Sage Therapeutics, Inc.\* (a) | 4440 | 167210 |
|  Sangamo Therapeutics, Inc.\* (a) | 3162 | 13881 |
|  Sarepta Therapeutics, Inc.\* (a) | 4625 | 527342 |
|  Seagen, Inc.\* | 3885 | 494017 |
|  Seres Therapeutics, Inc.\* (a) | 2232 | 19775 |
|  Sorrento Therapeutics, Inc.\* (a) | 1860 | 2920 |
|  Stoke Therapeutics, Inc.\* | 2790 | 41431 |
|  TG Therapeutics, Inc.\* | 7998 | 46548 |
|  Travere Therapeutics, Inc.\* | 1860 | 40325 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  Twist Bioscience Corp.\* (a) | 4836 | $158766 |
|  Ultragenyx Pharmaceutical, Inc.\* (a) | 3348 | 135460 |
|  uniQure NV\* | 10602 | 197409 |
|  United Therapeutics Corp.\* | 1850 | 426480 |
|  Vanda Pharmaceuticals, Inc.\* | 1302 | 13632 |
|  Vaxart, Inc.\* (a) | 186 | 311 |
|  Veracyte, Inc.\* (a) | 3534 | 71069 |
|  Vericel Corp.\* (a) | 1674 | 44997 |
|  Vertex Pharmaceuticals, Inc.\* | 7030 | 2193360 |
|  Vir Biotechnology, Inc.\* (a) | 17484 | 384298 |
|  Xencor, Inc.\* (a) | 2046 | 57288 |
|  Y-mAbs Therapeutics, Inc.\* (a) | 4278 | 15444 |
|  |  | **40796199** |
| **Building Products – 0.7%** |  |  |
|  A O Smith Corp.(a) | 3534 | 193593 |
|  AAON, Inc.(a) | 2604 | 167932 |
|  Advanced Drainage Systems, Inc. | 1674 | 193983 |
|  Allegion plc(a) | 1665 | 174442 |
|  American Woodmark Corp.\* | 1674 | 75916 |
|  Apogee Enterprises, Inc.(a) | 2960 | 135805 |
|  Armstrong World Industries, Inc. | 2046 | 154616 |
|  AZEK Co., Inc. (The)\* (a) | 4650 | 81421 |
|  Builders FirstSource, Inc.\* (a) | 6386 | 393761 |
|  Carlisle Cos., Inc. | 1488 | 355334 |
|  Carrier Global Corp. | 24180 | 961397 |
|  Fortune Brands Home & Security, Inc. | 4278 | 258049 |
|  Gibraltar Industries, Inc.\* | 930 | 47504 |
|  Griffon Corp. | 10602 | 340748 |
|  Hayward Holdings, Inc.\* (a) | 18685 | 172836 |
|  Insteel Industries, Inc. | 186 | 4901 |
|  JELD-WEN Holding, Inc.\* | 18786 | 199319 |
|  Johnson Controls International plc | 22692 | 1312505 |
|  Lennox International, Inc. | 1140 | 266270 |
|  Masco Corp.(a) | 7440 | 344249 |

---

*See Accompanying Notes to the Financial Statements.* 

154 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** |
|  Masonite International Corp.\* | 4070 | $291127 |
|  Owens Corning(a) | 4092 | 350316 |
|  PGT Innovations, Inc.\* (a) | 14880 | 317093 |
|  Quanex Building Products Corp.(a) | 4650 | 103044 |
|  Resideo Technologies, Inc.\* | 31062 | 733684 |
|  Simpson Manufacturing Co., Inc. | 1674 | 143094 |
|  Trane Technologies plc | 5952 | 950118 |
|  Trex Co., Inc.\* | 3534 | 169950 |
|  UFP Industries, Inc. | 13764 | 980410 |
|  Zurn Elkay Water Solutions Corp.(a) | 4836 | 113598 |
|  |  | **9987015** |
| **Capital Markets – 3.1%** |  |  |
|  Affiliated Managers Group, Inc. | 9237 | 1146866 |
|  Ameriprise Financial, Inc.(a) | 3885 | 1200931 |
|  Ares Management Corp. | 3720 | 282088 |
|  Artisan Partners Asset Management, Inc., Class A(a) | 14880 | 424229 |
| B. Riley Financial, Inc.(a) | 3906 | 158896 |
|  Bank of New York Mellon Corp. (The) | 24738 | 1041717 |
|  BGC Partners, Inc., Class A | 68261 | 270314 |
|  BlackRock, Inc. | 4978 | 3215340 |
|  Blackstone, Inc., Class A(a) | 18228 | 1661300 |
|  Blucora, Inc.\* | 14245 | 313817 |
|  Blue Owl Capital, Inc.(a) | 20088 | 201282 |
|  Brightsphere Investment Group, Inc.(a) | 5580 | 105016 |
|  Carlyle Group, Inc. (The) | 4995 | 141259 |
|  Charles Schwab Corp. (The) | 40361 | 3215561 |
|  CME Group, Inc. | 9672 | 1676158 |
|  Cohen & Steers, Inc.(a) | 744 | 44759 |
|  Coinbase Global, Inc., Class A\* (a) | 5735 | 379944 |
|  Cowen, Inc., Class A(a) | 7770 | 300077 |
|  Donnelley Financial Solutions, Inc.\* (a) | 6324 | 255679 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Evercore, Inc., Class A | 8742 | $918784 |
|  FactSet Research Systems, Inc. | 930 | 395706 |
|  Federated Hermes, Inc., Class B(a) | 20832 | 723912 |
|  Focus Financial Partners, Inc., Class A\* (a) | 13950 | 485320 |
|  Franklin Resources, Inc.(a) | 10974 | 257340 |
|  GCM Grosvenor, Inc., Class A(a) | 16368 | 135363 |
|  Goldman Sachs Group, Inc. (The) | 11100 | 3824061 |
|  Hamilton Lane, Inc., Class A | 925 | 55333 |
|  Houlihan Lokey, Inc. | 1860 | 166135 |
|  Interactive Brokers Group, Inc., Class A | 4440 | 355866 |
|  Intercontinental Exchange, Inc. | 14060 | 1343714 |
|  Invesco Ltd.(a) | 14694 | 225112 |
|  Janus Henderson Group plc(a) | 32005 | 728754 |
|  Jefferies Financial Group, Inc. | 8325 | 286463 |
|  KKR & Co., Inc. | 19344 | 940699 |
|  LPL Financial Holdings, Inc. | 2405 | 614838 |
|  MarketAxess Holdings, Inc. | 930 | 226957 |
|  Moelis & Co., Class A(a) | 3534 | 150054 |
|  Moody's Corp. | 3885 | 1029020 |
|  Morgan Stanley | 44955 | 3693952 |
|  Morningstar, Inc. | 558 | 129556 |
|  MSCI, Inc. | 2046 | 959288 |
|  Nasdaq, Inc. | 8928 | 555679 |
|  Northern Trust Corp.(c) | 6696 | 564807 |
|  Open Lending Corp., Class A\* | 12462 | 89353 |
|  Oppenheimer Holdings, Inc., Class A | 372 | 12804 |
|  Piper Sandler Cos.(a) | 3348 | 428444 |
|  PJT Partners, Inc., Class A(a) | 372 | 27677 |
|  Raymond James Financial, Inc.(a) | 7068 | 835013 |
|  S&P Global, Inc. | 8928 | 2868120 |
|  SEI Investments Co. | 3162 | 171697 |
|  State Street Corp. | 11346 | 839604 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 155

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  StepStone Group, Inc., Class A(a) | 3534 | $104324 |
|  Stifel Financial Corp.(a) | 22755 | 1407852 |
|  StoneX Group, Inc.\* | 4625 | 431605 |
| T. Rowe Price Group, Inc.(a) | 7998 | 849068 |
|  TPG, Inc.(a) | 2418 | 74353 |
|  Tradeweb Markets, Inc., Class A | 1850 | 101898 |
|  Victory Capital Holdings, Inc., Class A | 5952 | 172132 |
|  Virtu Financial, Inc., Class A | 20460 | 457895 |
|  Virtus Investment Partners, Inc.(a) | 1488 | 255177 |
|  WisdomTree Investments, Inc.(a) | 186 | 1010 |
|  |  | **43929972** |
| **Chemicals – 1.8%** |  |  |
|  AdvanSix, Inc. | 8325 | 302863 |
|  Air Products and Chemicals, Inc. | 5952 | 1490381 |
|  Albemarle Corp.(a) | 3162 | 884949 |
|  Amyris, Inc.\* (a) | 7998 | 22474 |
|  Ashland, Inc. | 2046 | 214666 |
|  Avient Corp. | 2976 | 102642 |
|  Axalta Coating Systems Ltd.\* | 9486 | 221214 |
|  Balchem Corp.(a) | 2046 | 286031 |
|  Cabot Corp.(a) | 13020 | 956710 |
|  Celanese Corp. | 3720 | 357566 |
|  CF Industries Holdings, Inc. | 7215 | 766666 |
|  Chase Corp.(a) | 186 | 17523 |
|  Chemours Co. (The)(a) | 37185 | 1064607 |
|  Corteva, Inc. | 17856 | 1166711 |
|  Danimer Scientific, Inc.\* (a) | 5766 | 15107 |
|  Diversey Holdings Ltd.\* (a) | 12090 | 65286 |
|  Dow, Inc.(a) | 22506 | 1051930 |
|  DuPont de Nemours, Inc. | 12025 | 687830 |
|  Eastman Chemical Co.(a) | 4278 | 328593 |
|  Ecolab, Inc. | 6510 | 1022526 |
|  Ecovyst, Inc.\* | 1302 | 12955 |
|  Element Solutions, Inc.(a) | 14322 | 246338 |
|  FMC Corp. | 3885 | 461926 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Chemicals – (continued)** |  |  |  |
|  Ginkgo Bioworks Holdings, Inc.\* (a) | 59705 | $| 162995 |
|  Hawkins, Inc. | 558 |  | 25127 |
|  HB Fuller Co.(a) | 1674 |  | 116695 |
|  Huntsman Corp.(a) | 40145 |  | 1074280 |
|  Ingevity Corp.\* | 8928 |  | 600587 |
|  Innospec, Inc. | 744 |  | 74393 |
|  International Flavors & Fragrances, Inc. | 6882 |  | 671752 |
|  Intrepid Potash, Inc.\* (a) | 2046 |  | 92582 |
|  Koppers Holdings, Inc.(a) | 1480 |  | 36941 |
|  Kronos Worldwide, Inc.(a) | 4650 |  | 44175 |
|  Linde plc(a) | 12950 |  | 3850682 |
|  Livent Corp.\* (a) | 7812 |  | 246625 |
|  LyondellBasell Industries NV, Class A | 8370 |  | 639886 |
|  Mativ Holdings, Inc.(a) | 9341 |  | 221755 |
|  Minerals Technologies, Inc.(a) | 8184 |  | 450202 |
|  Mosaic Co. (The) | 11532 |  | 619845 |
|  NewMarket Corp. | 1295 |  | 394120 |
|  Olin Corp. | 5920 |  | 313464 |
|  Perimeter Solutions SA\* (a) | 10230 |  | 81738 |
|  PPG Industries, Inc. | 6510 |  | 743312 |
|  Quaker Chemical Corp.(a) | 930 |  | 151255 |
|  RPM International, Inc. | 2976 |  | 281440 |
|  Scotts Miracle-Gro Co. (The)(a) | 2604 |  | 119550 |
|  Sensient Technologies Corp.(a) | 1302 |  | 93041 |
|  Sherwin-Williams Co. (The) | 6324 |  | 1423090 |
|  Stepan Co.(a) | 1860 |  | 194258 |
|  Tredegar Corp.(a) | 10044 |  | 109379 |
|  Trinseo plc(a) | 7998 |  | 150522 |
|  Tronox Holdings plc | 23436 |  | 281232 |
|  Valvoline, Inc. | 8742 |  | 256665 |
|  Westlake Corp.(a) | 372 |  | 35954 |
|  |  |  | **25305036** |
| **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** |
|  ABM Industries, Inc. | 2046 |  | 91067 |
|  ACCO Brands Corp. | 27528 |  | 126629 |
|  ACV Auctions, Inc., Class A\* (a) | 5022 |  | 45801 |

---

*See Accompanying Notes to the Financial Statements.* 

156 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** |
|  Brady Corp., Class A(a) | 1116 | $51057 |
|  BrightView Holdings, Inc.\* | 7626 | 68024 |
|  Brink's Co. (The)(a) | 10788 | 643288 |
|  Casella Waste Systems, Inc., Class A\* (a) | 2232 | 182600 |
|  Cimpress plc\* | 6324 | 147223 |
|  Cintas Corp. | 2232 | 954292 |
|  Clean Harbors, Inc.\* | 2035 | 249206 |
|  Copart, Inc.\* | 5920 | 680918 |
|  CoreCivic, Inc., REIT\* (a) | 29016 | 303798 |
|  Deluxe Corp.(a) | 10416 | 191446 |
|  Driven Brands Holdings, Inc.\* (a) | 3534 | 113017 |
|  Ennis, Inc. | 9381 | 211635 |
|  GEO Group, Inc. (The)\* (a) | 19425 | 164335 |
|  Harsco Corp.\* (a) | 2976 | 15743 |
|  Healthcare Services Group, Inc.(a) | 5394 | 75300 |
|  HNI Corp. | 3720 | 107843 |
|  IAA, Inc.\* (a) | 7812 | 296309 |
|  Interface, Inc.(a) | 8370 | 94665 |
|  KAR Auction Services, Inc.\* (a) | 3330 | 48385 |
|  Matthews International Corp., Class A(a) | 5580 | 149990 |
|  MillerKnoll, Inc. | 2232 | 47274 |
|  Montrose Environmental Group, Inc.\* (a) | 186 | 8143 |
|  MSA Safety, Inc. | 2405 | 322847 |
|  Pitney Bowes, Inc. | 18786 | 58424 |
|  Republic Services, Inc. | 5580 | 740020 |
|  Rollins, Inc.(a) | 6882 | 289595 |
|  SP Plus Corp.\* | 4092 | 151527 |
|  Steelcase, Inc., Class A | 8184 | 63590 |
|  Stericycle, Inc.\* (a) | 5920 | 263914 |
|  Tetra Tech, Inc. | 1860 | 262781 |
|  UniFirst Corp.(a) | 1116 | 205355 |
|  Viad Corp.\* (a) | 2418 | 90143 |
|  Waste Management, Inc.(a) | 10044 | 1590668 |
|  |  | **9106852** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Communications Equipment – 0.8%** | **Communications Equipment – 0.8%** | **Communications Equipment – 0.8%** |
|  ADTRAN Holdings, Inc.(a) | 4092 | $91906 |
|  Arista Networks, Inc.\* (a) | 5920 | 715491 |
|  Calix, Inc.\* (a) | 3906 | 287638 |
|  Cambium Networks Corp.\* (a) | 558 | 10797 |
|  Casa Systems, Inc.\* (a) | 4836 | 15233 |
|  Ciena Corp.\* (a) | 3906 | 187097 |
|  Cisco Systems, Inc. | 137637 | 6252849 |
|  CommScope Holding Co., Inc.\* (a) | 46313 | 613184 |
|  Comtech Telecommunications Corp.(a) | 4836 | 53438 |
|  Digi International, Inc.\* (a) | 3720 | 150028 |
|  Extreme Networks, Inc.\* | 12462 | 223568 |
|  F5, Inc.\* (a) | 1488 | 212650 |
|  Harmonic, Inc.\* (a) | 2790 | 43106 |
|  Infinera Corp.\* (a) | 7254 | 40695 |
|  Juniper Networks, Inc. | 12834 | 392720 |
|  Lumentum Holdings, Inc.\* (a) | 2775 | 206599 |
|  Motorola Solutions, Inc. | 4650 | 1161152 |
|  NETGEAR, Inc.\* | 7626 | 149851 |
|  NetScout Systems, Inc.\* | 5824 | 209198 |
|  Ribbon Communications, Inc.\* (a) | 28458 | 75414 |
|  Viasat, Inc.\* (a) | 3348 | 137134 |
|  Viavi Solutions, Inc.\* (a) | 7215 | 108947 |
|  |  | **11338695** |
| **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** |
|  AECOM(a) | 4705 | 354192 |
|  Ameresco, Inc., Class A\* | 1302 | 78745 |
|  API Group Corp.\* (a) | 6105 | 100671 |
|  Arcosa, Inc.(a) | 1488 | 95530 |
|  Argan, Inc.(a) | 1860 | 64486 |
|  Comfort Systems USA, Inc.(a) | 2604 | 321021 |
|  Construction Partners, Inc., Class A\* (a) | 930 | 28960 |
|  Dycom Industries, Inc.\* | 1488 | 175852 |
|  EMCOR Group, Inc. | 3145 | 443760 |
|  Fluor Corp.\* (a) | 6324 | 191364 |
|  Granite Construction, Inc.(a) | 3720 | 125476 |
|  Great Lakes Dredge & Dock Corp.\* | 8556 | 64683 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 157

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  IES Holdings, Inc.\* (a) | 2604 | $| 86036 |
|  MasTec, Inc.\* (a) | 12143 |  | 935982 |
|  MDU Resources Group, Inc. | 45941 |  | 1308400 |
|  MYR Group, Inc.\* | 1674 |  | 146492 |
|  NV5 Global, Inc.\* (a) | 185 |  | 26816 |
|  Primoris Services Corp. | 11346 |  | 229076 |
|  Quanta Services, Inc.(a) | 4255 |  | 604380 |
|  Sterling Infrastructure, Inc.\* (a) | 6510 |  | 175705 |
|  Tutor Perini Corp.\* | 3534 |  | 26222 |
|  Valmont Industries, Inc. | 925 |  | 295279 |
|  WillScot Mobile Mini Holdings Corp.\* (a) | 7415 |  | 315360 |
|  |  |  | **6194488** |
| **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** |
|  Eagle Materials, Inc.(a) | 1860 |  | 227497 |
|  Martin Marietta Materials, Inc. | 1674 |  | 562430 |
|  Summit Materials, Inc., Class A\* (a) | 5394 |  | 142132 |
|  Vulcan Materials Co. | 3348 |  | 548068 |
|  |  |  | **1480127** |
| **Consumer Finance – 0.8%** | **Consumer Finance – 0.8%** | **Consumer Finance – 0.8%** | **Consumer Finance – 0.8%** |
|  Ally Financial, Inc. | 12395 |  | 341606 |
|  American Express Co. | 16280 |  | 2416766 |
|  Atlanticus Holdings Corp.\* (a) | 558 |  | 15936 |
|  Bread Financial Holdings, Inc. | 9250 |  | 334017 |
|  Capital One Financial Corp. | 13415 |  | 1422258 |
|  Credit Acceptance Corp.\* (a) | 301 |  | 140152 |
|  Curo Group Holdings Corp.(a) | 3906 |  | 20194 |
|  Discover Financial Services | 8325 |  | 869630 |
|  Encore Capital Group, Inc.\* (a) | 6845 |  | 348547 |
|  Enova International, Inc.\* | 7998 |  | 299845 |
|  EZCORP, Inc., Class A\* (a) | 3700 |  | 35742 |
|  FirstCash Holdings, Inc. | 1488 |  | 146494 |
|  Green Dot Corp., Class A\* | 13020 |  | 247771 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** |
|  LendingClub Corp.\* (a) | 23436 | $| 249359 |
|  LendingTree, Inc.\* (a) | 558 |  | 14078 |
|  Moneylion, Inc.\* (a) | 18600 |  | 20832 |
|  Navient Corp.(a) | 25296 |  | 382981 |
|  Nelnet, Inc., Class A(a) | 4650 |  | 414269 |
|  OneMain Holdings, Inc.(a) | 25900 |  | 998704 |
|  PROG Holdings, Inc.\* | 7812 |  | 129054 |
|  Regional Management Corp. | 744 |  | 25266 |
|  SLM Corp.(a) | 61786 |  | 1025030 |
|  SoFi Technologies, Inc.\* (a) | 41663 |  | 226647 |
|  Synchrony Financial | 15996 |  | 568818 |
|  Upstart Holdings, Inc.\* (a) | 3348 |  | 77607 |
|  World Acceptance Corp.\* | 372 |  | 30214 |
|  |  |  | **10801817** |
| **Containers & Packaging – 0.6%** | **Containers & Packaging – 0.6%** | **Containers & Packaging – 0.6%** | **Containers & Packaging – 0.6%** |
|  Amcor plc(a) | 52079 |  | 603075 |
|  AptarGroup, Inc.(a) | 2232 |  | 221303 |
|  Avery Dennison Corp. | 1860 |  | 315363 |
|  Ball Corp.(a) | 8370 |  | 413394 |
|  Berry Global Group, Inc.\* | 5365 |  | 253872 |
|  Crown Holdings, Inc.(a) | 4625 |  | 317229 |
|  Graphic Packaging Holding Co. | 66415 |  | 1524888 |
|  Greif, Inc., Class A(a) | 6138 |  | 406397 |
|  International Paper Co. | 12276 |  | 412596 |
|  Myers Industries, Inc. | 186 |  | 3774 |
|  O-I Glass, Inc.\* | 31434 |  | 512689 |
|  Packaging Corp. of America | 3162 |  | 380104 |
|  Pactiv Evergreen, Inc. | 9114 |  | 99434 |
|  Ranpak Holdings Corp.\* | 4278 |  | 16256 |
|  Sealed Air Corp. | 5200 |  | 247624 |
|  Silgan Holdings, Inc.(a) | 18042 |  | 854469 |
|  Sonoco Products Co.(a) | 20905 |  | 1297782 |
|  TriMas Corp.(a) | 1488 |  | 34001 |
|  Westrock Co. | 9114 |  | 310423 |
|  |  |  | **8224673** |
| **Distributors – 0.1%** |  |  |  |
|  Funko, Inc., Class A\* (a) | 4625 |  | 95506 |
|  Genuine Parts Co. | 4650 |  | 827049 |
|  LKQ Corp. | 10044 |  | 558848 |
|  Pool Corp. | 930 |  | 282934 |
|  |  |  | **1764337** |

---

*See Accompanying Notes to the Financial Statements.* 

158 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Diversified Consumer Services – 0.3%** | **Diversified Consumer Services – 0.3%** |  |  |
|  2U, Inc.\* (a) | 21762 | $| 134707 |
|  ADT, Inc.(a) | 52823 |  | 446882 |
|  Adtalem Global Education, Inc.\* (a) | 8325 |  | 347152 |
|  American Public Education, Inc.\* (a) | 2232 |  | 28592 |
|  Bright Horizons Family Solutions, Inc.\* | 1302 |  | 85047 |
|  Chegg, Inc.\* (a) | 7812 |  | 168505 |
|  Coursera, Inc.\* (a) | 9858 |  | 127070 |
|  Duolingo, Inc.\* | 1302 |  | 106556 |
|  Frontdoor, Inc.\* | 4650 |  | 102579 |
|  Graham Holdings Co., Class B(a) | 930 |  | 580199 |
|  Grand Canyon Education, Inc.\* | 1295 |  | 130316 |
|  H&R Block, Inc.(a) | 37555 |  | 1545388 |
|  Laureate Education, Inc., Class A | 9990 |  | 126274 |
|  OneSpaWorld Holdings Ltd.\* (a) | 9486 |  | 86038 |
|  Perdoceo Education Corp.\* (a) | 13020 |  | 148819 |
|  PowerSchool Holdings, Inc., Class A\* (a) | 2232 |  | 44640 |
|  Service Corp. International(a) | 4836 |  | 293110 |
|  Strategic Education, Inc.(a) | 1860 |  | 128340 |
|  Stride, Inc.\* (a) | 4034 |  | 135179 |
|  Udemy, Inc.\* (a) | 1488 |  | 21650 |
|  Vivint Smart Home, Inc.\* | 3906 |  | 29881 |
|  WW International, Inc.\* (a) | 13950 |  | 63054 |
|  |  |  | **4879978** |
| **Diversified Financial Services – 1.4%** | **Diversified Financial Services – 1.4%** | **Diversified Financial Services – 1.4%** | **Diversified Financial Services – 1.4%** |
|  A-Mark Precious Metals, Inc.(a) | 2976 |  | 90500 |
|  Apollo Global Management, Inc. | 13020 |  | 720787 |
|  Berkshire Hathaway, Inc., Class B\* | 59705 |  | 17618348 |
|  Cannae Holdings, Inc.\* | 930 |  | 21539 |
|  Compass Diversified Holdings | 3534 |  | 75204 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** |
|  Equitable Holdings, Inc. | 13875 | $| 424853 |
|  Jackson Financial, Inc., Class A(a) | 11470 |  | 439989 |
|  Voya Financial, Inc.(a) | 4440 |  | 303518 |
|  |  |  | **19694738** |
| **Diversified Telecommunication Services – 0.8%** | **Diversified Telecommunication Services – 0.8%** | **Diversified Telecommunication Services – 0.8%** | **Diversified Telecommunication Services – 0.8%** |
|  Anterix, Inc.\* | 186 |  | 7133 |
|  AT&T, Inc. | 239190 |  | 4360434 |
|  ATN International, Inc.(a) | 740 |  | 31909 |
|  Bandwidth, Inc., Class A\* (a) | 186 |  | 2208 |
|  Cogent Communications Holdings, Inc. | 930 |  | 48834 |
|  Consolidated Communications Holdings, Inc.\* (a) | 14136 |  | 73083 |
|  Globalstar, Inc.\* (a) | 22134 |  | 48031 |
|  IDT Corp., Class B\* | 3348 |  | 87249 |
|  Iridium Communications, Inc.\* (a) | 7440 |  | 383383 |
|  Liberty Latin America Ltd., Class A\* | 8928 |  | 69460 |
|  Liberty Latin America Ltd., Class C\* | 44030 |  | 342993 |
|  Lumen Technologies, Inc.(a) | 27528 |  | 202606 |
|  Radius Global Infrastructure, Inc.\* (a) | 5580 |  | 52173 |
|  Verizon Communications, Inc. | 136900 |  | 5115953 |
|  |  |  | **10825449** |
| **Electric Utilities – 1.5%** |  |  |  |
|  ALLETE, Inc.(a) | 1850 |  | 104099 |
|  Alliant Energy Corp.(a) | 7812 |  | 407552 |
|  American Electric Power Co., Inc. | 16368 |  | 1439075 |
|  Avangrid, Inc. | 1674 |  | 68098 |
|  Constellation Energy Corp.(a) | 7770 |  | 734576 |
|  Duke Energy Corp. | 24738 |  | 2305087 |
|  Edison International | 11655 |  | 699766 |
|  Entergy Corp. | 6105 |  | 654090 |
|  Evergy, Inc. | 6475 |  | 395817 |
|  Eversource Energy | 9486 |  | 723592 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 159

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Exelon Corp. | 31806 | $| 1227394 |
|  FirstEnergy Corp. | 18228 |  | 687378 |
|  Hawaiian Electric Industries, Inc. | 6696 |  | 254716 |
|  IDACORP, Inc. | 2976 |  | 311587 |
|  MGE Energy, Inc. | 1116 |  | 75988 |
|  NextEra Energy, Inc. | 51521 |  | 3992878 |
|  NRG Energy, Inc.(a) | 9486 |  | 421178 |
|  OGE Energy Corp. | 8403 |  | 307802 |
|  Otter Tail Corp. | 1295 |  | 87309 |
|  PG&E Corp.\* (a) | 47730 |  | 712609 |
|  Pinnacle West Capital Corp. | 3906 |  | 262522 |
|  PNM Resources, Inc. | 5208 |  | 242016 |
|  Portland General Electric Co.(a) | 21663 |  | 973535 |
|  PPL Corp. | 17205 |  | 455760 |
|  Southern Co. (The) | 34967 |  | 2289639 |
|  Xcel Energy, Inc. | 15252 |  | 993058 |
|  |  |  | **20827121** |
| **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** |
|  Acuity Brands, Inc.(a) | 2220 |  | 407525 |
|  AMETEK, Inc. | 5550 |  | 719613 |
|  Array Technologies, Inc.\* (a) | 31434 |  | 568955 |
|  Atkore, Inc.\* (a) | 10224 |  | 974347 |
|  Blink Charging Co.\* (a) | 2046 |  | 30281 |
|  Bloom Energy Corp., Class A\* (a) | 7440 |  | 139202 |
|  ChargePoint Holdings, Inc.\* (a) | 10602 |  | 148216 |
|  Eaton Corp. plc | 10602 |  | 1591042 |
|  Emerson Electric Co. | 18600 |  | 1610760 |
|  Encore Wire Corp.(a) | 4278 |  | 588610 |
|  EnerSys(a) | 1116 |  | 73980 |
|  Enovix Corp.\* (a) | 24180 |  | 456277 |
|  Fluence Energy, Inc.\* (a) | 7254 |  | 108302 |
|  FuelCell Energy, Inc.\* (a) | 19716 |  | 61514 |
|  Generac Holdings, Inc.\* | 1674 |  | 194033 |
|  GrafTech International Ltd. | 40547 |  | 206384 |
|  Hubbell, Inc.(a) | 1302 |  | 309199 |
|  nVent Electric plc(a) | 10602 |  | 386973 |
|  Plug Power, Inc.\* (a) | 16368 |  | 261561 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** |
|  Regal Rexnord Corp.(a) | 2232 | $| 282437 |
|  Rockwell Automation, Inc.(a) | 2976 |  | 759773 |
|  Sensata Technologies Holding plc | 6138 |  | 246809 |
|  Shoals Technologies Group, Inc., Class A\* (a) | 6324 |  | 146148 |
|  Stem, Inc.\* (a) | 10788 |  | 146717 |
|  SunPower Corp.\* (a) | 6510 |  | 120370 |
|  Sunrun, Inc.\* (a) | 47801 |  | 1076001 |
|  TPI Composites, Inc.\* (a) | 2976 |  | 29641 |
|  Vertiv Holdings Co.(a) | 17298 |  | 247534 |
|  Vicor Corp.\* | 744 |  | 35541 |
|  |  |  | **11927745** |
| **Electronic Equipment, Instruments & Components – 1.1%** | **Electronic Equipment, Instruments & Components – 1.1%** | **Electronic Equipment, Instruments & Components – 1.1%** | **Electronic Equipment, Instruments & Components – 1.1%** |
|  Advanced Energy Industries, Inc. | 1116 |  | 87773 |
|  Aeva Technologies, Inc.\* (a) | 22134 |  | 44268 |
|  Amphenol Corp., Class A | 14800 |  | 1122284 |
|  Arrow Electronics, Inc.\* | 2775 |  | 280997 |
|  Avnet, Inc. | 21576 |  | 867139 |
|  Badger Meter, Inc.(a) | 2232 |  | 251055 |
|  Belden, Inc. | 9858 |  | 686413 |
|  Benchmark Electronics, Inc. | 8928 |  | 253466 |
|  CDW Corp. | 3348 |  | 578568 |
|  Cognex Corp. | 4092 |  | 189173 |
|  Coherent Corp.\* (a) | 5181 |  | 174119 |
|  Corning, Inc. | 25668 |  | 825740 |
|  CTS Corp.(a) | 930 |  | 36754 |
|  ePlus, Inc.\* (a) | 2790 |  | 135929 |
|  Fabrinet\* (a) | 2232 |  | 255341 |
|  FARO Technologies, Inc.\* (a) | 372 |  | 10866 |
|  Flex Ltd.\* | 18786 |  | 367830 |
|  Insight Enterprises, Inc.\* (a) | 7786 |  | 735855 |
|  IPG Photonics Corp.\* (a) | 2604 |  | 223059 |
|  Itron, Inc.\* | 2046 |  | 100029 |
|  Jabil, Inc. | 5735 |  | 368474 |
|  Keysight Technologies, Inc.\* | 4836 |  | 842189 |
|  Kimball Electronics, Inc.\* (a) | 2035 |  | 42063 |
|  Knowles Corp.\* (a) | 2790 |  | 38363 |
|  Lightwave Logic, Inc.\* (a) | 930 |  | 7877 |
|  Littelfuse, Inc.(a) | 1302 |  | 286766 |
|  Methode Electronics, Inc. | 3700 |  | 152551 |

---

*See Accompanying Notes to the Financial Statements.* 

160 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** |
|  MicroVision, Inc.\* (a) | 8370 | $| 30634 |
|  Mirion Technologies, Inc.\* (a) | 29388 |  | 237455 |
|  National Instruments Corp.(a) | 8742 |  | 333770 |
|  nLight, Inc.\* | 1116 |  | 12019 |
|  Novanta, Inc.\* | 2046 |  | 289304 |
|  OSI Systems, Inc.\* | 555 |  | 45610 |
|  PAR Technology Corp.\* (a) | 2976 |  | 85649 |
|  PC Connection, Inc.(a) | 186 |  | 9884 |
|  Plexus Corp.\* | 740 |  | 72816 |
|  Sanmina Corp.\* | 14644 |  | 820796 |
|  ScanSource, Inc.\* | 4278 |  | 132532 |
|  TD SYNNEX Corp.(a) | 744 |  | 68083 |
|  TE Connectivity Ltd. | 10788 |  | 1318617 |
|  Teledyne Technologies, Inc.\* | 1302 |  | 518170 |
|  Trimble, Inc.\* | 6696 |  | 402831 |
|  TTM Technologies, Inc.\* | 22506 |  | 344567 |
|  Velodyne Lidar, Inc.\* (a) | 372 |  | 367 |
|  Vishay Intertechnology, Inc.(a) | 27528 |  | 575611 |
|  Vontier Corp. | 4995 |  | 95405 |
|  Zebra Technologies Corp., Class A\* | 1665 |  | 471561 |
|  |  |  | **14830622** |
| **Energy Equipment & Services – 0.5%** | **Energy Equipment & Services – 0.5%** | **Energy Equipment & Services – 0.5%** | **Energy Equipment & Services – 0.5%** |
|  Archrock, Inc.(a) | 13950 |  | 104765 |
|  Baker Hughes Co. | 24552 |  | 679108 |
|  Cactus, Inc., Class A(a) | 4650 |  | 240498 |
|  ChampionX Corp. | 13764 |  | 393926 |
|  Core Laboratories NV(a) | 2418 |  | 47054 |
|  Dril-Quip, Inc.\* (a) | 186 |  | 4628 |
|  Halliburton Co. | 21645 |  | 788311 |
|  Helix Energy Solutions Group, Inc.\* (a) | 41291 |  | 289037 |
|  Helmerich & Payne, Inc.(a) | 7030 |  | 348055 |
|  Liberty Energy, Inc., Class A\* | 8184 |  | 138391 |
|  Nabors Industries Ltd.\* (a) | 925 |  | 161023 |
|  NexTier Oilfield Solutions, Inc.\* | 15910 |  | 160373 |
|  Noble Corp. plc\* (a) | 5732 |  | 206581 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** |
|  NOV, Inc.(a) | 24790 | $555296 |
|  Oceaneering International, Inc.\* | 10974 | 153526 |
|  Oil States International, Inc.\* (a) | 558 | 3610 |
|  Patterson-UTI Energy, Inc.(a) | 7030 | 124080 |
|  ProPetro Holding Corp.\* | 12210 | 144566 |
|  RPC, Inc.(a) | 13320 | 148252 |
|  Schlumberger NV(a) | 35705 | 1857731 |
|  Select Energy Services, Inc., Class A\* | 13505 | 130323 |
|  Transocean Ltd.\* (a) | 125985 | 463625 |
|  US Silica Holdings, Inc.\* | 5766 | 82973 |
|  Weatherford International plc\* | 14322 | 596941 |
|  |  | **7822673** |
| **Entertainment – 1.1%** |  |  |
|  Activision Blizzard, Inc. | 18315 | 1333332 |
|  AMC Entertainment Holdings, Inc., Class A\* (a) | 10044 | 66893 |
|  Cinemark Holdings, Inc.\* (a) | 3720 | 39469 |
|  Electronic Arts, Inc. | 6660 | 838894 |
|  IMAX Corp.\* | 2046 | 26046 |
|  Liberty Media Corp-Liberty Formula One, Class A\* | 1860 | 96757 |
|  Liberty Media Corp-Liberty Formula One, Class C\* | 5766 | 332871 |
|  Lions Gate Entertainment Corp., Class A\* (a) | 10070 | 81164 |
|  Lions Gate Entertainment Corp., Class B\* | 13964 | 105987 |
|  Live Nation Entertainment, Inc.\* (a) | 3534 | 281342 |
|  Madison Square Garden Entertainment Corp.\* (a) | 1860 | 91196 |
|  Madison Square Garden Sports Corp., Class A | 555 | 86919 |
|  Marcus Corp. (The)(a) | 1110 | 16694 |
|  Netflix, Inc.\* | 14880 | 4343174 |
|  Playtika Holding Corp.\* | 3720 | 35154 |
|  Roku, Inc.\* (a) | 3162 | 175618 |
|  Skillz, Inc.\* (a) | 83512 | 86017 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 161

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Entertainment – (continued)** | **Entertainment – (continued)** | **Entertainment – (continued)** | **Entertainment – (continued)** |
|  Take-Two Interactive Software, Inc.\* | 3906 | $| 462783 |
|  Walt Disney Co. (The)\* | 48545 |  | 5171984 |
|  Warner Bros Discovery, Inc.\* (a) | 72724 |  | 945412 |
|  Warner Music Group Corp., Class A(a) | 6510 |  | 169390 |
|  World Wrestling Entertainment, Inc., Class A(a) | 1302 |  | 102715 |
|  |  |  | **14889811** |
| **Equity Real Estate Investment Trusts (REITs) – 2.8%** | **Equity Real Estate Investment Trusts (REITs) – 2.8%** | **Equity Real Estate Investment Trusts (REITs) – 2.8%** | **Equity Real Estate Investment Trusts (REITs) – 2.8%** |
|  Acadia Realty Trust | 4092 |  | 57165 |
|  Agree Realty Corp.(a) | 5208 |  | 357790 |
|  Alexander & Baldwin, Inc. | 3162 |  | 61596 |
|  Alexander's, Inc.(a) | 186 |  | 43690 |
|  Alexandria Real Estate Equities, Inc.(a) | 3515 |  | 510730 |
|  American Assets Trust, Inc. | 185 |  | 5084 |
|  American Homes 4 Rent, Class A(a) | 6696 |  | 213870 |
|  American Tower Corp. | 12276 |  | 2543464 |
|  Americold Realty Trust, Inc.(a) | 9858 |  | 239056 |
|  Apartment Income REIT Corp. | 2405 |  | 92424 |
|  Apple Hospitality REIT, Inc. | 6845 |  | 117186 |
|  Armada Hoffler Properties, Inc. | 1674 |  | 19569 |
|  AvalonBay Communities, Inc. | 4070 |  | 712738 |
|  Boston Properties, Inc. | 3534 |  | 256922 |
|  Braemar Hotels & Resorts, Inc.(a) | 372 |  | 1834 |
|  Brixmor Property Group, Inc.(a) | 11346 |  | 241783 |
|  Broadstone Net Lease, Inc.(a) | 10044 |  | 172154 |
|  Camden Property Trust | 2418 |  | 279400 |
|  CareTrust REIT, Inc. | 7812 |  | 145928 |
|  Centerspace | 1488 |  | 103118 |
|  Chatham Lodging Trust\* (a) | 7626 |  | 98909 |
|  City Office REIT, Inc. | 6510 |  | 69136 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Community Healthcare Trust, Inc.(a) | 1302 | $45049 |
|  Corporate Office Properties Trust(a) | 3145 | 83814 |
|  Cousins Properties, Inc.(a) | 10788 | 256323 |
|  Crown Castle, Inc. | 11718 | 1561541 |
|  CubeSmart | 7254 | 303725 |
|  DiamondRock Hospitality Co. | 19151 | 178870 |
|  Digital Realty Trust, Inc. | 7030 | 704757 |
|  Douglas Emmett, Inc.(a) | 12648 | 222478 |
|  Easterly Government Properties, Inc.(a) | 925 | 16086 |
|  EastGroup Properties, Inc. | 1589 | 248980 |
|  Elme Communities(a) | 6882 | 131377 |
|  Empire State Realty Trust, Inc., Class A(a) | 10044 | 74024 |
|  EPR Properties | 5580 | 215388 |
|  Equinix, Inc. | 2418 | 1369652 |
|  Equity Commonwealth(a) | 6324 | 165436 |
|  Equity LifeStyle Properties, Inc. | 4836 | 309311 |
|  Equity Residential | 9858 | 621251 |
|  Essential Properties Realty Trust, Inc. | 8742 | 188128 |
|  Essex Property Trust, Inc. | 2035 | 452258 |
|  Extra Space Storage, Inc. | 3348 | 594069 |
|  Federal Realty Investment Trust | 1860 | 184103 |
|  First Industrial Realty Trust, Inc. | 7812 | 372086 |
|  Four Corners Property Trust, Inc.(a) | 1674 | 42888 |
|  Gaming and Leisure Properties, Inc. | 7254 | 363570 |
|  Getty Realty Corp.(a) | 186 | 5857 |
|  Healthcare Realty Trust, Inc.(a) | 20274 | 412170 |
|  Healthpeak Properties, Inc. | 17020 | 403885 |
|  Hersha Hospitality Trust, Class A(a) | 186 | 1702 |
|  Highwoods Properties, Inc. | 3330 | 94006 |
|  Host Hotels & Resorts, Inc. | 17670 | 333610 |
|  Hudson Pacific Properties, Inc.(a) | 4440 | 49018 |

---

*See Accompanying Notes to the Financial Statements.* 

162 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Independence Realty Trust, Inc. | 9300 | $155868 |
|  Industrial Logistics Properties Trust | 4464 | 20892 |
|  Innovative Industrial Properties, Inc. | 1860 | 201066 |
|  InvenTrust Properties Corp.(a) | 2976 | 74995 |
|  Invitation Homes, Inc. | 14136 | 447970 |
|  Iron Mountain, Inc.(a) | 7440 | 372521 |
|  iStar, Inc. | 19716 | 206624 |
|  JBG SMITH Properties | 6510 | 128117 |
|  Kilroy Realty Corp.(a) | 1295 | 55348 |
|  Kimco Realty Corp. | 19716 | 421528 |
|  Kite Realty Group Trust(a) | 7955 | 156236 |
|  Lamar Advertising Co., Class A(a) | 2976 | 274476 |
|  Life Storage, Inc. | 2790 | 308602 |
|  LTC Properties, Inc.(a) | 3700 | 143079 |
|  LXP Industrial Trust(a) | 17298 | 167445 |
|  Macerich Co. (The) | 7440 | 82807 |
|  Medical Properties Trust, Inc.(a) | 24366 | 278991 |
|  Mid-America Apartment Communities, Inc.(a) | 2976 | 468571 |
|  National Health Investors, Inc.(a) | 2604 | 147647 |
|  National Retail Properties, Inc. | 3162 | 132899 |
|  National Storage Affiliates Trust(a) | 5580 | 238043 |
|  Necessity Retail REIT, Inc. (The)(a) | 26226 | 179386 |
|  NETSTREIT Corp.(a) | 6308 | 118717 |
|  NexPoint Residential Trust, Inc. | 186 | 8482 |
|  Office Properties Income Trust(a) | 6845 | 104728 |
|  Omega Healthcare Investors, Inc.(a) | 14743 | 468533 |
|  Outfront Media, Inc.(a) | 4070 | 73464 |
|  Park Hotels & Resorts, Inc. | 16962 | 221863 |
|  Pebblebrook Hotel Trust(a) | 9486 | 152155 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Phillips Edison & Co., Inc.(a) | 6324 | $190605 |
|  Physicians Realty Trust(a) | 7585 | 114230 |
|  Piedmont Office Realty Trust, Inc., Class A | 740 | 7733 |
|  Plymouth Industrial REIT, Inc. | 4464 | 82316 |
|  PotlatchDeltic Corp. | 16650 | 740758 |
|  Prologis, Inc. | 24938 | 2761884 |
|  Public Storage | 4092 | 1267497 |
|  Rayonier, Inc.(a) | 8928 | 300874 |
|  Realty Income Corp.(a) | 17298 | 1077146 |
|  Regency Centers Corp.(a) | 2976 | 180078 |
|  Retail Opportunity Investments Corp. | 4092 | 59252 |
|  Rexford Industrial Realty, Inc.(a) | 5022 | 277616 |
|  RLJ Lodging Trust | 2790 | 33954 |
|  RPT Realty | 9300 | 86490 |
|  Ryman Hospitality Properties, Inc. | 3534 | 314243 |
|  Sabra Health Care REIT, Inc.(a) | 46990 | 641883 |
|  Safehold, Inc.(a) | 2775 | 81169 |
|  SBA Communications Corp. | 2790 | 753021 |
|  Service Properties Trust | 6324 | 51288 |
|  Simon Property Group, Inc. | 9114 | 993244 |
|  SITE Centers Corp.(a) | 5394 | 66778 |
|  SL Green Realty Corp.(a) | 2790 | 110707 |
|  Spirit Realty Capital, Inc.(a) | 8556 | 332229 |
|  STAG Industrial, Inc. | 11840 | 374026 |
|  STORE Capital Corp. | 4650 | 147870 |
|  Summit Hotel Properties, Inc.(a) | 29946 | 258733 |
|  Sun Communities, Inc. | 3534 | 476560 |
|  Sunstone Hotel Investors, Inc.(a) | 9300 | 103695 |
|  Tanger Factory Outlet Centers, Inc.(a) | 9486 | 170843 |
|  Terreno Realty Corp.(a) | 4278 | 244445 |
|  UDR, Inc. | 6475 | 257446 |
|  UMH Properties, Inc.(a) | 6640 | 116466 |
|  Uniti Group, Inc.(a) | 14880 | 115469 |
|  Universal Health Realty Income Trust(a) | 1480 | 72032 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 163

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Urban Edge Properties | 5022 | $| 70911 |
|  Urstadt Biddle Properties, Inc., Class A(a) | 5394 |  | 101084 |
|  Ventas, Inc. | 9672 |  | 378465 |
|  VICI Properties, Inc. | 31248 |  | 1000561 |
|  Vornado Realty Trust(a) | 3906 |  | 92143 |
|  Welltower, Inc.(a) | 11904 |  | 726620 |
|  Weyerhaeuser Co. | 17390 |  | 537873 |
|  Whitestone REIT | 12276 |  | 115517 |
|  WP Carey, Inc. | 5208 |  | 397370 |
|  Xenia Hotels & Resorts, Inc. | 10441 |  | 178332 |
|  |  |  | **38621467** |
| **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** |
|  Albertsons Cos., Inc., Class A | 2775 |  | 56915 |
|  Andersons, Inc. (The)(a) | 2790 |  | 98403 |
|  BJ's Wholesale Club Holdings, Inc.\* | 4545 |  | 351783 |
|  Casey's General Stores, Inc.(a) | 1665 |  | 387462 |
|  Chefs' Warehouse, Inc. (The)\* (a) | 3885 |  | 142308 |
|  Costco Wholesale Corp. | 11718 |  | 5876577 |
|  Fresh Market, Inc. (The)\* (d) | 319 |  | 177 |
|  Grocery Outlet Holding Corp.\* (a) | 3162 |  | 109310 |
|  Ingles Markets, Inc., Class A(a) | 1586 |  | 149671 |
|  Kroger Co. (The) | 22940 |  | 1084833 |
|  Performance Food Group Co.\* | 3534 |  | 183909 |
|  PriceSmart, Inc. | 372 |  | 23797 |
|  SpartanNash Co.(a) | 4285 |  | 153017 |
|  Sprouts Farmers Market, Inc.\* (a) | 26825 |  | 791338 |
|  Sysco Corp.(a) | 13392 |  | 1159212 |
|  United Natural Foods, Inc.\* | 14800 |  | 627668 |
|  US Foods Holding Corp.\* (a) | 7770 |  | 231235 |
|  Walgreens Boots Alliance, Inc.(a) | 21576 |  | 787524 |
|  Walmart, Inc. | 37185 |  | 5292541 |
|  Weis Markets, Inc.(a) | 1811 |  | 169636 |
|  |  |  | **17677316** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food Products – 1.2%** |  |  |
|  Archer-Daniels-Midland Co.(a) | 18972 | $1839905 |
|  B&G Foods, Inc.(a) | 5952 | 97494 |
|  Beyond Meat, Inc.\* (a) | 3534 | 55484 |
|  Bunge Ltd. | 4255 | 419969 |
|  Calavo Growers, Inc.(a) | 186 | 6434 |
|  Cal-Maine Foods, Inc.(a) | 740 | 41817 |
|  Campbell Soup Co.(a) | 6510 | 344444 |
|  Conagra Brands, Inc.(a) | 16368 | 600706 |
|  Darling Ingredients, Inc.\* | 4836 | 379529 |
|  Flowers Foods, Inc. | 12276 | 352444 |
|  Freshpet, Inc.\* (a) | 2418 | 142541 |
|  General Mills, Inc.(a) | 20535 | 1675245 |
|  Hain Celestial Group, Inc. (The)\* | 2790 | 52201 |
|  Hershey Co. (The) | 3720 | 888224 |
|  Hormel Foods Corp.(a) | 8370 | 388787 |
|  Hostess Brands, Inc.\* (a) | 4255 | 112672 |
|  Ingredion, Inc. | 15066 | 1342682 |
|  J & J Snack Foods Corp.(a) | 1302 | 192188 |
|  J M Smucker Co. (The) | 3906 | 588478 |
|  John B Sanfilippo & Son, Inc.(a) | 1480 | 123447 |
|  Kellogg Co. | 8184 | 628695 |
|  Kraft Heinz Co. (The) | 24235 | 932320 |
|  Lamb Weston Holdings, Inc. | 3906 | 336775 |
|  Lancaster Colony Corp.(a) | 1480 | 266814 |
|  McCormick & Co., Inc. (Non-Voting)(a) | 7440 | 585082 |
|  Mondelez International, Inc., Class A | 37555 | 2308881 |
|  Pilgrim's Pride Corp.\* | 9300 | 214365 |
|  Post Holdings, Inc.\* (a) | 3348 | 302726 |
|  Seaboard Corp. | 62 | 232276 |
|  Simply Good Foods Co. (The)\* | 2604 | 99733 |
|  Tattooed Chef, Inc.\* (a) | 10230 | 48593 |
|  Tootsie Roll Industries, Inc.(a) | 3162 | 127713 |
|  TreeHouse Foods, Inc.\* (a) | 1110 | 55766 |
|  Tyson Foods, Inc., Class A | 8556 | 584803 |
|  Utz Brands, Inc.(a) | 7998 | 129648 |
|  Vital Farms, Inc.\* (a) | 1860 | 24626 |
|  |  | **16523507** |

---

*See Accompanying Notes to the Financial Statements.* 

164 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Gas Utilities – 0.3%** |  |  |  |
|  Atmos Energy Corp.(a) | 3348 | $| 356729 |
|  Chesapeake Utilities Corp.(a) | 558 |  | 69404 |
|  National Fuel Gas Co. | 21645 |  | 1460821 |
|  New Jersey Resources Corp.(a) | 6762 |  | 301856 |
|  Northwest Natural Holding Co.(a) | 2790 |  | 134171 |
|  ONE Gas, Inc. | 3720 |  | 288226 |
|  South Jersey Industries, Inc.(a) | 8673 |  | 300693 |
|  Southwest Gas Holdings, Inc.(a) | 2418 |  | 176683 |
|  Spire, Inc.(a) | 12950 |  | 904039 |
|  UGI Corp. | 7812 |  | 275998 |
|  |  |  | **4268620** |
| **Health Care Equipment & Supplies – 2.3%** | **Health Care Equipment & Supplies – 2.3%** | **Health Care Equipment & Supplies – 2.3%** | **Health Care Equipment & Supplies – 2.3%** |
|  Abbott Laboratories | 45695 |  | 4521063 |
|  ABIOMED, Inc.\* | 1116 |  | 281321 |
|  Align Technology, Inc.\* | 2232 |  | 433678 |
|  Alphatec Holdings, Inc.\* (a) | 186 |  | 1905 |
|  AngioDynamics, Inc.\* | 558 |  | 7862 |
|  Artivion, Inc.\* (a) | 2976 |  | 33212 |
|  AtriCure, Inc.\* (a) | 4070 |  | 171428 |
|  Atrion Corp. | 186 |  | 111658 |
|  Avanos Medical, Inc.\* | 1116 |  | 24719 |
|  Axonics, Inc.\* | 2976 |  | 217665 |
|  Baxter International, Inc. | 12210 |  | 663614 |
|  Becton Dickinson and Co. | 7770 |  | 1833487 |
|  BioLife Solutions, Inc.\* (a) | 1860 |  | 43747 |
|  Bioventus, Inc., Class A\* (a) | 2790 |  | 22711 |
|  Boston Scientific Corp.\* | 39590 |  | 1706725 |
|  Cardiovascular Systems, Inc.\* | 186 |  | 2686 |
|  CONMED Corp.(a) | 930 |  | 74149 |
|  Cooper Cos., Inc. (The)(a) | 1302 |  | 355954 |
|  Dentsply Sirona, Inc. | 5580 |  | 171976 |
|  Dexcom, Inc.\* | 10416 |  | 1258044 |
|  Edwards Lifesciences Corp.\* | 15996 |  | 1158590 |
|  Embecta Corp.(a) | 14322 |  | 442836 |
|  Enovis Corp.\* (a) | 2604 |  | 128784 |
|  Envista Holdings Corp.\* (a) | 6696 |  | 221035 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Establishment Labs Holdings, Inc.\* (a) | 1488 | $83908 |
|  Figs, Inc., Class A\* (a) | 1674 | 12354 |
|  Glaukos Corp.\* (a) | 2604 | 146006 |
|  Globus Medical, Inc., Class A\* (a) | 4464 | 299088 |
|  Haemonetics Corp.\* (a) | 2976 | 252811 |
|  Heska Corp.\* (a) | 372 | 26695 |
|  Hologic, Inc.\* (a) | 8370 | 567486 |
|  ICU Medical, Inc.\* (a) | 1302 | 193230 |
|  IDEXX Laboratories, Inc.\* | 2418 | 869706 |
|  Inari Medical, Inc.\* (a) | 2046 | 157399 |
|  Inogen, Inc.\* | 1302 | 29503 |
|  Inspire Medical Systems, Inc.\* (a) | 1488 | 290086 |
|  Insulet Corp.\* (a) | 1674 | 433248 |
|  Integer Holdings Corp.\* (a) | 930 | 57967 |
|  Integra LifeSciences Holdings Corp.\* | 4092 | 205623 |
|  Intuitive Surgical, Inc.\* | 9065 | 2234251 |
|  iRhythm Technologies, Inc.\* | 1488 | 189705 |
|  Lantheus Holdings, Inc.\* | 4527 | 334953 |
|  LeMaitre Vascular, Inc.(a) | 186 | 8072 |
|  LivaNova plc\* | 3162 | 148930 |
|  Masimo Corp.\* | 2976 | 391642 |
|  Medtronic plc | 34410 | 3005369 |
|  Merit Medical Systems, Inc.\* | 1850 | 127225 |
|  Mesa Laboratories, Inc.(a) | 744 | 98364 |
|  Neogen Corp.\* (a) | 15910 | 210012 |
|  Nevro Corp.\* | 2046 | 78444 |
|  Novocure Ltd.\* (a) | 2604 | 183999 |
|  NuVasive, Inc.\* | 2976 | 131331 |
|  Omnicell, Inc.\* (a) | 2418 | 186960 |
|  OraSure Technologies, Inc.\* | 186 | 811 |
|  Orthofix Medical, Inc.\* | 740 | 11884 |
|  Outset Medical, Inc.\* (a) | 2604 | 40466 |
|  Penumbra, Inc.\* (a) | 2405 | 412385 |
|  PROCEPT BioRobotics Corp.\* (a) | 1860 | 84500 |
|  QuidelOrtho Corp.\* | 11346 | 1019098 |
|  ResMed, Inc. | 3720 | 832127 |
|  Senseonics Holdings, Inc.\* (a) | 558 | 658 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 165

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Shockwave Medical, Inc.\* | 2046 | $| 599785 |
|  SI-BONE, Inc.\* (a) | 2976 |  | 57853 |
|  Silk Road Medical, Inc.\* | 2790 |  | 122983 |
|  STAAR Surgical Co.\* (a) | 2232 |  | 158182 |
|  STERIS plc(a) | 2976 |  | 513598 |
|  Stryker Corp. | 8695 |  | 1993242 |
|  Surmodics, Inc.\* | 186 |  | 6350 |
|  Tandem Diabetes Care, Inc.\* (a) | 4092 |  | 229766 |
|  Teleflex, Inc. | 1488 |  | 319265 |
|  TransMedics Group, Inc.\* (a) | 1488 |  | 71751 |
|  Treace Medical Concepts, Inc.\* (a) | 2604 |  | 63746 |
|  ViewRay, Inc.\* (a) | 7068 |  | 30322 |
|  Zimmer Biomet Holdings, Inc. | 6138 |  | 695742 |
|  Zimvie, Inc.\* | 5952 |  | 52199 |
|  |  |  | **32159929** |
| **Health Care Providers & Services – 3.4%** | **Health Care Providers & Services – 3.4%** | **Health Care Providers & Services – 3.4%** | **Health Care Providers & Services – 3.4%** |
|  1Life Healthcare, Inc.\* | 39035 |  | 667498 |
|  Acadia Healthcare Co., Inc.\* (a) | 5735 |  | 466256 |
|  Accolade, Inc.\* (a) | 19425 |  | 209402 |
|  AdaptHealth Corp.\* (a) | 16465 |  | 375402 |
|  Addus HomeCare Corp.\* (a) | 1110 |  | 113686 |
|  Agiliti, Inc.\* (a) | 372 |  | 6499 |
|  agilon health, Inc.\* (a) | 5920 |  | 117512 |
|  Alignment Healthcare, Inc.\* | 21090 |  | 279232 |
|  Amedisys, Inc.\* | 1674 |  | 163366 |
|  AmerisourceBergen Corp.(a) | 5394 |  | 848045 |
|  AMN Healthcare Services, Inc.\* (a) | 10044 |  | 1260522 |
|  Apollo Medical Holdings, Inc.\* (a) | 744 |  | 26382 |
|  Aveanna Healthcare Holdings, Inc.\* (a) | 5952 |  | 8273 |
|  Brookdale Senior Living, Inc.\* | 54125 |  | 241939 |
|  Cano Health, Inc.\* (a) | 15624 |  | 55934 |
|  Cardinal Health, Inc.(a) | 9858 |  | 748222 |
|  Castle Biosciences, Inc.\* (a) | 2232 |  | 56961 |
|  Centene Corp.\* | 19610 |  | 1669399 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Chemed Corp. | 372 | $173676 |
|  Cigna Corp. | 10360 | 3346902 |
|  Clover Health Investments Corp.\* (a) | 84256 | 133124 |
|  Community Health Systems, Inc.\* (a) | 26970 | 77404 |
|  Cross Country Healthcare, Inc.\* (a) | 7998 | 296646 |
|  CVS Health Corp. | 42593 | 4033557 |
|  DaVita, Inc.\* (a) | 2590 | 189096 |
|  Elevance Health, Inc. | 7998 | 4373066 |
|  Encompass Health Corp.(a) | 3885 | 211499 |
|  Ensign Group, Inc. (The)(a) | 2035 | 182702 |
|  Fulgent Genetics, Inc.\* (a) | 4278 | 169537 |
|  Guardant Health, Inc.\* (a) | 6138 | 303831 |
|  HCA Healthcare, Inc. | 7400 | 1609278 |
|  HealthEquity, Inc.\* | 4092 | 318808 |
|  Henry Schein, Inc.\* | 4650 | 318339 |
|  Humana, Inc. | 4092 | 2283663 |
|  Innovage Holding Corp.\* (a) | 186 | 1151 |
|  Invitae Corp.\* (a) | 70115 | 180897 |
|  Joint Corp. (The)\* | 186 | 3073 |
|  Laboratory Corp. of America Holdings(a) | 3162 | 701521 |
|  McKesson Corp. | 4995 | 1944903 |
|  ModivCare, Inc.\* | 372 | 36173 |
|  Molina Healthcare, Inc.\* | 2046 | 734228 |
|  National HealthCare Corp.(a) | 2046 | 124642 |
|  National Research Corp.(a) | 2418 | 98485 |
|  Oak Street Health, Inc.\* (a) | 4625 | 93564 |
|  OPKO Health, Inc.\* | 90208 | 171395 |
|  Option Care Health, Inc.\* | 10044 | 303931 |
|  Owens & Minor, Inc.(a) | 17298 | 294066 |
|  Patterson Cos., Inc.(a) | 20274 | 526516 |
|  Pediatrix Medical Group, Inc.\* (a) | 4464 | 86602 |
|  PetIQ, Inc.\* | 2418 | 19876 |
|  Premier, Inc., Class A | 24605 | 858222 |
|  Privia Health Group, Inc.\* (a) | 2590 | 86713 |
|  Progyny, Inc.\* | 3348 | 148886 |
|  Quest Diagnostics, Inc. | 4278 | 614535 |
|  R1 RCM, Inc.\* (a) | 4278 | 75549 |

---

*See Accompanying Notes to the Financial Statements.* 

166 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  RadNet, Inc.\* | 1116 | $| 21338 |
|  Select Medical Holdings Corp.(a) | 20535 |  | 527339 |
|  Signify Health, Inc., Class A\* (a) | 3700 |  | 108151 |
|  Surgery Partners, Inc.\* (a) | 3534 |  | 96089 |
|  Tenet Healthcare Corp.\* | 4740 |  | 210266 |
|  UnitedHealth Group, Inc. | 24975 |  | 13864871 |
|  Universal Health Services, Inc., Class B | 1480 |  | 171488 |
|  US Physical Therapy, Inc.(a) | 186 |  | 16517 |
|  |  |  | **47456645** |
| **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** |
|  Allscripts Healthcare Solutions, Inc.\* (a) | 10267 |  | 150925 |
|  American Well Corp., Class A\* (a) | 17484 |  | 71510 |
|  Certara, Inc.\* | 6324 |  | 77342 |
|  Computer Programs & Systems, Inc.\* (a) | 3348 |  | 108140 |
|  Doximity, Inc., Class A\* (a) | 7955 |  | 210569 |
|  Evolent Health, Inc., Class A\* (a) | 6290 |  | 200085 |
|  HealthStream, Inc.\* | 186 |  | 4594 |
|  Multiplan Corp.\* (a) | 13392 |  | 38435 |
|  NextGen Healthcare, Inc.\* | 558 |  | 11182 |
|  OptimizeRx Corp.\* | 558 |  | 8602 |
|  Phreesia, Inc.\* (a) | 4995 |  | 136463 |
|  Schrodinger, Inc.\* (a) | 3348 |  | 80252 |
|  Simulations Plus, Inc.(a) | 930 |  | 38595 |
|  Teladoc Health, Inc.\* (a) | 9858 |  | 292191 |
|  Veeva Systems, Inc., Class A\* | 3906 |  | 655974 |
|  |  |  | **2084859** |
| **Hotels, Restaurants & Leisure – 2.1%** | **Hotels, Restaurants & Leisure – 2.1%** | **Hotels, Restaurants & Leisure – 2.1%** | **Hotels, Restaurants & Leisure – 2.1%** |
|  Airbnb, Inc., Class A\* (a) | 10416 |  | 1113575 |
|  Aramark | 6324 |  | 230826 |
|  BJ's Restaurants, Inc.\* (a) | 2232 |  | 73321 |
|  Bloomin' Brands, Inc.(a) | 18786 |  | 451052 |
|  Booking Holdings, Inc.\* | 1053 |  | 1968562 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Boyd Gaming Corp. | 4278 | $247097 |
|  Brinker International, Inc.\* (a) | 8325 | 277972 |
|  Caesars Entertainment, Inc.\* (a) | 6510 | 284682 |
|  Carnival Corp.\* (a) | 35897 | 325227 |
|  Cheesecake Factory, Inc. (The)(a) | 11160 | 399640 |
|  Chipotle Mexican Grill, Inc.\* (a) | 744 | 1114758 |
|  Choice Hotels International, Inc.(a) | 1116 | 144901 |
|  Churchill Downs, Inc. | 930 | 193356 |
|  Cracker Barrel Old Country Store, Inc.(a) | 4440 | 507137 |
|  Darden Restaurants, Inc. | 2976 | 425985 |
|  Dave & Buster's Entertainment, Inc.\* (a) | 4070 | 162189 |
|  Denny's Corp.\* | 1674 | 18966 |
|  Dine Brands Global, Inc.(a) | 2590 | 186713 |
|  Domino's Pizza, Inc. | 1116 | 370780 |
|  DraftKings, Inc., Class A\* (a) | 23064 | 364411 |
|  El Pollo Loco Holdings, Inc.(a) | 3720 | 37349 |
|  Everi Holdings, Inc.\* | 8370 | 158863 |
|  Expedia Group, Inc.\* | 3906 | 365094 |
|  F45 Training Holdings, Inc.\* (a) | 1302 | 4349 |
|  First Watch Restaurant Group, Inc.\* (a) | 1302 | 22199 |
|  Hilton Grand Vacations, Inc.\* | 19530 | 766357 |
|  Hilton Worldwide Holdings, Inc. | 6882 | 930859 |
|  Hyatt Hotels Corp., Class A\* (a) | 10974 | 1033861 |
|  Jack in the Box, Inc.(a) | 372 | 32822 |
|  Las Vegas Sands Corp.\* (a) | 9300 | 353493 |
|  Life Time Group Holdings, Inc.\* (a) | 9114 | 95606 |
|  Light & Wonder, Inc.\* | 3515 | 197332 |
|  Marriott International, Inc., Class A | 7254 | 1161438 |
|  Marriott Vacations Worldwide Corp. | 2604 | 384767 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 167

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  McDonald's Corp. | 19716 | $| 5375765 |
|  Membership Collective Group, Inc., Class A\* (a) | 6324 |  | 28964 |
|  MGM Resorts International | 10742 |  | 382093 |
|  Norwegian Cruise Line Holdings Ltd.\* (a) | 11100 |  | 187479 |
|  Papa John's International, Inc.(a) | 2232 |  | 162110 |
|  Penn Entertainment, Inc.\* (a) | 37943 |  | 1255913 |
|  Planet Fitness, Inc., Class A\* | 5208 |  | 341020 |
|  Portillo's, Inc., Class A\* | 1674 |  | 35891 |
|  Red Rock Resorts, Inc., Class A(a) | 2232 |  | 92963 |
|  Royal Caribbean Cruises Ltd.\* (a) | 4650 |  | 248217 |
|  Rush Street Interactive, Inc.\* (a) | 12648 |  | 52489 |
|  Ruth's Hospitality Group, Inc.(a) | 5580 |  | 115952 |
|  SeaWorld Entertainment, Inc.\* (a) | 3515 |  | 204432 |
|  Shake Shack, Inc., Class A\* (a) | 2232 |  | 124032 |
|  Six Flags Entertainment Corp.\* (a) | 5580 |  | 124434 |
|  Starbucks Corp.(a) | 29600 |  | 2563064 |
|  Texas Roadhouse, Inc. | 4255 |  | 421032 |
|  Travel + Leisure Co. | 17205 |  | 653446 |
|  Vail Resorts, Inc.(a) | 1116 |  | 244549 |
|  Wendy's Co. (The) | 12210 |  | 253724 |
|  Wingstop, Inc.(a) | 2046 |  | 324066 |
|  Wyndham Hotels & Resorts, Inc. | 3534 |  | 268337 |
|  Wynn Resorts Ltd.\* (a) | 2405 |  | 153679 |
|  Yum! Brands, Inc. | 8140 |  | 962555 |
|  |  |  | **28981745** |
| **Household Durables – 0.9%** | **Household Durables – 0.9%** | **Household Durables – 0.9%** | **Household Durables – 0.9%** |
|  Beazer Homes USA, Inc.\* | 3348 |  | 37866 |
|  Cavco Industries, Inc.\* (a) | 186 |  | 42161 |
|  Century Communities, Inc.(a) | 7812 |  | 347712 |
|  Cricut, Inc., Class A\* (a) | 744 |  | 6614 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** |
|  DR Horton, Inc.(a) | 10602 | $815082 |
|  Dream Finders Homes, Inc., Class A\* (a) | 5580 | 61938 |
|  Ethan Allen Interiors, Inc.(a) | 4650 | 118993 |
|  Garmin Ltd. | 4464 | 393011 |
|  GoPro, Inc., Class A\* (a) | 28458 | 155096 |
|  Green Brick Partners, Inc.\* (a) | 8742 | 202202 |
|  Helen of Troy Ltd.\* | 1488 | 140795 |
|  Installed Building Products, Inc. | 744 | 63984 |
|  iRobot Corp.\* (a) | 1488 | 84072 |
|  KB Home | 20832 | 600378 |
|  La-Z-Boy, Inc.(a) | 8556 | 211932 |
|  Leggett & Platt, Inc.(a) | 30690 | 1035788 |
|  Lennar Corp., Class A(a) | 8880 | 716616 |
|  Lennar Corp., Class B | 558 | 36393 |
|  LGI Homes, Inc.\* (a) | 5394 | 496518 |
|  Lovesac Co. (The)\* (a) | 1302 | 31691 |
|  M/I Homes, Inc.\* | 7812 | 324120 |
|  MDC Holdings, Inc.(a) | 13392 | 407920 |
|  Meritage Homes Corp.\* | 8928 | 679956 |
|  Mohawk Industries, Inc.\* | 1674 | 158611 |
|  Newell Brands, Inc.(a) | 12090 | 166963 |
|  NVR, Inc.\* | 104 | 440726 |
|  PulteGroup, Inc. | 9065 | 362509 |
|  Skyline Champion Corp.\* | 1860 | 108271 |
|  Sonos, Inc.\* (a) | 7812 | 125929 |
|  Taylor Morrison Home Corp., Class A\* (a) | 28305 | 745554 |
|  Tempur Sealy International, Inc. | 40361 | 1085307 |
|  Toll Brothers, Inc. | 22506 | 969558 |
|  TopBuild Corp.\* | 1674 | 284814 |
|  Traeger, Inc.\* | 3348 | 13894 |
|  Tri Pointe Homes, Inc.\* (a) | 27380 | 458615 |
|  Tupperware Brands Corp.\* | 12834 | 99207 |
|  Universal Electronics, Inc.\* | 2790 | 56944 |
|  Weber, Inc., Class A(a) | 2418 | 16104 |
|  Whirlpool Corp.(a) | 2232 | 308552 |
|  |  | **12412396** |

---

*See Accompanying Notes to the Financial Statements.* 

168 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Household Products – 1.0%** | **Household Products – 1.0%** | **Household Products – 1.0%** |
|  Central Garden & Pet Co.\* (a) | 1674 | $69086 |
|  Central Garden & Pet Co., Class A\* | 10230 | 400402 |
|  Church & Dwight Co., Inc. | 7254 | 537739 |
|  Clorox Co. (The)(a) | 3720 | 543269 |
|  Colgate-Palmolive Co. | 21830 | 1611927 |
|  Energizer Holdings, Inc.(a) | 15252 | 440630 |
|  Kimberly-Clark Corp. | 8325 | 1036129 |
|  Procter & Gamble Co. (The) | 63425 | 8541445 |
|  Reynolds Consumer Products, Inc.(a) | 370 | 11300 |
|  Spectrum Brands Holdings, Inc. | 3330 | 153646 |
|  WD-40 Co.(a) | 930 | 148949 |
|  |  | **13494522** |
| **Independent Power and Renewable Electricity<br>Producers – 0.1%** | **Independent Power and Renewable Electricity<br>Producers – 0.1%** | **Independent Power and Renewable Electricity<br>Producers – 0.1%** |
|  AES Corp. (The)(a) | 19344 | 506039 |
|  Clearway Energy, Inc., Class A | 3534 | 114254 |
|  Clearway Energy, Inc., Class C | 2418 | 84002 |
|  Ormat Technologies, Inc.(a) | 1665 | 150599 |
|  Sunnova Energy International, Inc.\* (a) | 5394 | 100005 |
|  Vistra Corp. | 15857 | 364235 |
|  |  | **1319134** |
| **Industrial Conglomerates – 0.6%** | **Industrial Conglomerates – 0.6%** | **Industrial Conglomerates – 0.6%** |
|  3M Co. | 17760 | 2234030 |
|  General Electric Co. | 28644 | 2228790 |
|  Honeywell International, Inc. | 18228 | 3718877 |
|  |  | **8181697** |
| **Insurance – 3.0%** |  |  |
|  Aflac, Inc.(a) | 20165 | 1312943 |
|  Allstate Corp. (The) | 9435 | 1191169 |
|  American Equity Investment Life Holding Co. | 18026 | 776560 |
|  American Financial Group, Inc. | 2790 | 404857 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Insurance – (continued)** |  |  |
|  American International Group, Inc.(a) | 25296 | $1441872 |
|  AMERISAFE, Inc. | 372 | 21729 |
|  Aon plc, Class A | 5580 | 1570714 |
|  Arch Capital Group Ltd.\* | 13690 | 787175 |
|  Argo Group International Holdings Ltd.(a) | 6882 | 171155 |
|  Arthur J Gallagher & Co. | 5180 | 969074 |
|  Assurant, Inc.(a) | 2232 | 303240 |
|  Assured Guaranty Ltd. | 4642 | 274760 |
|  Axis Capital Holdings Ltd. | 16740 | 915176 |
|  Brighthouse Financial, Inc.\* (a) | 17390 | 992447 |
|  Brown & Brown, Inc. | 6138 | 360853 |
|  BRP Group, Inc., Class A\* (a) | 1674 | 47458 |
|  Chubb Ltd. | 14060 | 3021353 |
|  Cincinnati Financial Corp.(a) | 4092 | 422785 |
|  CNO Financial Group, Inc. | 29789 | 657145 |
|  Employers Holdings, Inc.(a) | 744 | 32446 |
|  Enstar Group Ltd.\* | 2775 | 556443 |
|  Erie Indemnity Co., Class A | 370 | 95094 |
|  Everest Re Group Ltd. | 1116 | 360089 |
|  Fidelity National Financial, Inc. | 10788 | 424831 |
|  First American Financial Corp.(a) | 23622 | 1190549 |
|  Genworth Financial, Inc., Class A\* | 110667 | 516815 |
|  Globe Life, Inc. | 2604 | 300814 |
|  Goosehead Insurance, Inc., Class A\* (a) | 372 | 15442 |
|  Hagerty, Inc., Class A\* (a) | 6324 | 57485 |
|  Hanover Insurance Group, Inc. (The) | 7812 | 1144380 |
|  Hartford Financial Services Group, Inc. (The) | 11655 | 843939 |
|  HCI Group, Inc.(a) | 1302 | 47705 |
|  Horace Mann Educators Corp. | 7812 | 308262 |
|  Kemper Corp.(a) | 13206 | 629530 |
|  Kinsale Capital Group, Inc.(a) | 1302 | 410351 |
|  Lemonade, Inc.\* (a) | 2232 | 54014 |
|  Lincoln National Corp. | 6475 | 348808 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 169

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** |  |  |
|  Loews Corp. | 7812 | $445440 |
|  Markel Corp.\* | 370 | 446257 |
|  Marsh & McLennan Cos., Inc. | 13690 | 2210798 |
|  MBIA, Inc.\* | 6510 | 70048 |
|  Mercury General Corp. | 6696 | 194184 |
|  MetLife, Inc. | 23125 | 1692981 |
|  National Western Life Group, Inc., Class A(a) | 372 | 73663 |
|  Old Republic International Corp.(a) | 12462 | 289243 |
|  Oscar Health, Inc., Class A\* (a) | 10416 | 38852 |
|  Palomar Holdings, Inc.\* | 1674 | 148919 |
|  Primerica, Inc.(a) | 1480 | 214156 |
|  Principal Financial Group, Inc.(a) | 8621 | 759769 |
|  ProAssurance Corp. | 1674 | 37180 |
|  Progressive Corp. (The) | 16095 | 2066598 |
|  Prudential Financial, Inc. | 12276 | 1291312 |
|  Reinsurance Group of America, Inc. | 1665 | 245038 |
|  RenaissanceRe Holdings Ltd.(a) | 9435 | 1459406 |
|  RLI Corp. | 1480 | 192504 |
|  Ryan Specialty Holdings, Inc., Class A\* (a) | 2775 | 124459 |
|  Safety Insurance Group, Inc.(a) | 1665 | 144772 |
|  Selective Insurance Group, Inc. | 13206 | 1295244 |
|  SiriusPoint Ltd.\* | 15066 | 96724 |
|  Stewart Information Services Corp. | 6882 | 268123 |
|  Travelers Cos., Inc. (The) | 8325 | 1535630 |
|  Trupanion, Inc.\* (a) | 2418 | 122036 |
|  Universal Insurance Holdings, Inc.(a) | 930 | 9337 |
|  Unum Group(a) | 44215 | 2015762 |
|  W R Berkley Corp. | 5022 | 373536 |
|  White Mountains Insurance Group Ltd.(a) | 186 | 263404 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Insurance – (continued)** |  |  |  |
|  Willis Towers Watson plc | 2976 | $| 649393 |
|  |  |  | **41754230** |
| **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** | **Interactive Media & Services – 2.7%** |
|  Alphabet, Inc., Class A\* | 158175 |  | 14949119 |
|  Alphabet, Inc., Class C\* | 141340 |  | 13379244 |
|  Bumble, Inc., Class A\* (a) | 3720 |  | 94488 |
|  Cargurus, Inc.\* (a) | 9065 |  | 131987 |
|  Cars.com, Inc.\* (a) | 8556 |  | 118757 |
|  Eventbrite, Inc., Class A\* (a) | 5208 |  | 34217 |
|  fuboTV, Inc.\* (a) | 54311 |  | 198778 |
|  IAC, Inc.\* | 2976 |  | 144872 |
|  Match Group, Inc.\* | 8370 |  | 361584 |
|  MediaAlpha, Inc., Class A\* (a) | 2604 |  | 28592 |
|  Meta Platforms, Inc., Class A\* | 74740 |  | 6962778 |
|  Pinterest, Inc., Class A\* | 15252 |  | 375199 |
|  QuinStreet, Inc.\* (a) | 1674 |  | 19100 |
|  Shutterstock, Inc. | 1860 |  | 93056 |
|  Snap, Inc., Class A\* | 26226 |  | 259900 |
|  TripAdvisor, Inc.\* (a) | 6138 |  | 144980 |
|  Vimeo, Inc.\* | 8928 |  | 33926 |
|  Yelp, Inc.\* | 1665 |  | 63953 |
|  Ziff Davis, Inc.\* | 1480 |  | 114537 |
|  ZoomInfo Technologies, Inc., Class A\* (a) | 6696 |  | 298173 |
|  |  |  | **37807240** |
| **Internet & Direct Marketing Retail – 2.0%** | **Internet & Direct Marketing Retail – 2.0%** | **Internet & Direct Marketing Retail – 2.0%** | **Internet & Direct Marketing Retail – 2.0%** |
|  Amazon.com, Inc.\* | 234210 |  | 23992472 |
|  Chewy, Inc., Class A\* (a) | 5580 |  | 216113 |
|  ContextLogic, Inc., Class A\* (a) | 91882 |  | 71944 |
|  DoorDash, Inc., Class A\* | 7955 |  | 346281 |
|  eBay, Inc. | 16465 |  | 655966 |
|  Etsy, Inc.\* (a) | 2976 |  | 279476 |
|  Groupon, Inc.\* (a) | 2790 |  | 20562 |
|  Lands' End, Inc.\* | 558 |  | 5848 |
|  Liquidity Services, Inc.\* (a) | 558 |  | 9587 |
|  MercadoLibre, Inc.\* | 1295 |  | 1167598 |
|  Overstock.com, Inc.\* (a) | 2046 |  | 47570 |
|  PetMed Express, Inc.(a) | 1488 |  | 31724 |

---

*See Accompanying Notes to the Financial Statements.* 

170 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Internet & Direct Marketing Retail – (continued)** | **Internet & Direct Marketing Retail – (continued)** | **Internet & Direct Marketing Retail – (continued)** |
|  Porch Group, Inc.\* (a) | 27714 | $37691 |
|  Poshmark, Inc., Class A\* (a) | 2976 | 53151 |
|  Quotient Technology, Inc.\* (a) | 5394 | 13269 |
|  Qurate Retail, Inc., Series A | 91760 | 214718 |
|  RealReal, Inc. (The)\* (a) | 6138 | 10373 |
|  Revolve Group, Inc.\* (a) | 558 | 13392 |
|  Stitch Fix, Inc., Class A\* (a) | 23436 | 93744 |
|  Wayfair, Inc., Class A\* (a) | 4836 | 183381 |
|  Xometry, Inc., Class A\* (a) | 744 | 44685 |
|  |  | **27509545** |
| **IT Services – 3.7%** |  |  |
|  Accenture plc, Class A | 16740 | 4752486 |
|  Affirm Holdings, Inc.\* (a) | 9672 | 194117 |
|  Akamai Technologies, Inc.\* | 3720 | 328588 |
|  Automatic Data Processing, Inc. | 11285 | 2727584 |
|  AvidXchange Holdings, Inc.\* | 3348 | 30467 |
|  BigCommerce Holdings, Inc., Series 1\* | 6324 | 93975 |
|  Block, Inc., Class A\* (a) | 14985 | 900149 |
|  Broadridge Financial Solutions, Inc. | 3348 | 502401 |
|  Cantaloupe, Inc.\* | 2976 | 9970 |
|  Cloudflare, Inc., Class A\* | 6696 | 377119 |
|  Cognizant Technology Solutions Corp., Class A | 16368 | 1018908 |
|  Concentrix Corp. | 555 | 67838 |
|  Conduent, Inc.\* | 48173 | 198473 |
|  CSG Systems International, Inc.(a) | 2976 | 192458 |
|  DigitalOcean Holdings, Inc.\* (a) | 4810 | 172775 |
|  DXC Technology Co.\* | 10175 | 292531 |
|  Edgio, Inc.\* (a) | 3720 | 10007 |
|  EPAM Systems, Inc.\* | 1480 | 518000 |
|  Euronet Worldwide, Inc.\* | 2418 | 203136 |
|  EVERTEC, Inc.(a) | 1860 | 66607 |
|  Evo Payments, Inc., Class A\* | 1302 | 43864 |
|  ExlService Holdings, Inc.\* | 1295 | 235496 |
|  Fastly, Inc., Class A\* (a) | 5952 | 50532 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **IT Services – (continued)** |  |  |
|  Fidelity National Information Services, Inc. | 20460 | $1697975 |
|  Fiserv, Inc.\* | 20535 | 2109766 |
|  FleetCor Technologies, Inc.\* | 2046 | 380801 |
|  Flywire Corp.\* | 744 | 16331 |
|  Gartner, Inc.\* | 2405 | 726118 |
|  Genpact Ltd. | 3906 | 189441 |
|  Global Payments, Inc. | 9114 | 1041366 |
|  GoDaddy, Inc., Class A\* | 4278 | 343951 |
|  Grid Dynamics Holdings, Inc.\* | 372 | 5063 |
|  International Business Machines Corp.(a) | 29574 | 4089788 |
|  International Money Express, Inc.\* | 2604 | 70386 |
|  Jack Henry & Associates, Inc. | 2046 | 407277 |
|  Kyndryl Holdings, Inc.\* (a) | 41849 | 404680 |
|  Marqeta, Inc., Class A\* (a) | 20832 | 164156 |
|  Mastercard, Inc., Class A | 22385 | 7346309 |
|  Maximus, Inc. | 3885 | 239588 |
|  MongoDB, Inc.\* (a) | 1674 | 306392 |
|  Okta, Inc.\* | 3534 | 198328 |
|  Paya Holdings, Inc.\* | 186 | 1495 |
|  Paychex, Inc. | 8370 | 990255 |
|  Payoneer Global, Inc.\* (a) | 18972 | 147033 |
|  PayPal Holdings, Inc.\* | 31248 | 2611708 |
|  Perficient, Inc.\* | 1116 | 74738 |
|  Rackspace Technology, Inc.\* (a) | 15624 | 80464 |
|  Repay Holdings Corp.\* (a) | 6138 | 37380 |
|  Sabre Corp.\* (a) | 78118 | 453865 |
|  Shift4 Payments, Inc., Class A\* (a) | 3162 | 145357 |
|  Snowflake, Inc., Class A\* (a) | 7770 | 1245531 |
|  SolarWinds Corp.\* | 18685 | 174331 |
|  Squarespace, Inc., Class A\* | 1860 | 41311 |
|  SS&C Technologies Holdings, Inc. | 5766 | 296488 |
|  Switch, Inc., Class A(a) | 6138 | 208999 |
|  TaskUS, Inc., Class A\* (a) | 1116 | 22532 |
|  Toast, Inc., Class A\* (a) | 15624 | 345134 |
|  TTEC Holdings, Inc. | 558 | 24814 |
|  Tucows, Inc., Class A\* (a) | 186 | 8361 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 171

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **IT Services – (continued)** |  |  |  |
|  Twilio, Inc., Class A\* | 3700 | $| 275169 |
|  Unisys Corp.\* (a) | 13764 |  | 116994 |
|  VeriSign, Inc.\* | 2604 |  | 521998 |
|  Verra Mobility Corp.\* (a) | 11160 |  | 190501 |
|  Visa, Inc., Class A(a) | 43523 |  | 9016225 |
|  Western Union Co. (The)(a) | 88906 |  | 1201120 |
|  WEX, Inc.\* | 1850 |  | 303659 |
|  |  |  | **51260659** |
| **Leisure Products – 0.3%** | **Leisure Products – 0.3%** | **Leisure Products – 0.3%** | **Leisure Products – 0.3%** |
|  Acushnet Holdings Corp.(a) | 1116 |  | 51972 |
|  AMMO, Inc.\* (a) | 18786 |  | 61055 |
|  Brunswick Corp. | 17298 |  | 1222450 |
|  Hasbro, Inc. | 3162 |  | 206320 |
|  Johnson Outdoors, Inc., Class A(a) | 186 |  | 9787 |
|  Malibu Boats, Inc., Class A\* | 4092 |  | 216467 |
|  MasterCraft Boat Holdings, Inc.\* (a) | 740 |  | 16102 |
|  Mattel, Inc.\* (a) | 12648 |  | 239806 |
|  Peloton Interactive, Inc., Class A\* (a) | 18972 |  | 159365 |
|  Polaris, Inc.(a) | 12025 |  | 1221740 |
|  Smith & Wesson Brands, Inc. | 8370 |  | 94497 |
|  Solo Brands, Inc., Class A\* (a) | 1674 |  | 6914 |
|  Sturm Ruger & Co., Inc.(a) | 4092 |  | 229684 |
|  Topgolf Callaway Brands Corp.\* (a) | 5208 |  | 97494 |
|  Vista Outdoor, Inc.\* (a) | 11904 |  | 345692 |
|  YETI Holdings, Inc.\* (a) | 6324 |  | 202874 |
|  |  |  | **4382219** |
| **Life Sciences Tools & Services – 1.3%** | **Life Sciences Tools & Services – 1.3%** | **Life Sciences Tools & Services – 1.3%** | **Life Sciences Tools & Services – 1.3%** |
|  10X Genomics, Inc., Class A\* (a) | 6324 |  | 171886 |
|  AbCellera Biologics, Inc.\* (a) | 14694 |  | 173830 |
|  Absci Corp.\* (a) | 2046 |  | 6465 |
|  Adaptive Biotechnologies Corp.\* | 2418 |  | 18812 |
|  Agilent Technologies, Inc. | 7998 |  | 1106523 |
|  Avantor, Inc.\* | 14800 |  | 298516 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** |
|  Azenta, Inc.(a) | 4650 | $206460 |
|  Bionano Genomics, Inc.\* (a) | 16182 | 37866 |
|  Bio-Rad Laboratories, Inc., Class A\* | 558 | 196254 |
|  Bio-Techne Corp. | 930 | 275522 |
|  Bruker Corp.(a) | 2604 | 161031 |
|  Charles River Laboratories International, Inc.\* | 1302 | 276350 |
|  Codexis, Inc.\* | 5580 | 31360 |
|  CryoPort, Inc.\* (a) | 1674 | 46470 |
|  Cytek Biosciences, Inc.\* (a) | 1302 | 20207 |
|  Danaher Corp. | 17020 | 4283423 |
|  Illumina, Inc.\* | 4464 | 1021453 |
|  IQVIA Holdings, Inc.\* | 4625 | 969724 |
|  Maravai LifeSciences Holdings, Inc., Class A\* (a) | 6510 | 108066 |
|  Medpace Holdings, Inc.\* (a) | 1116 | 247730 |
|  Mettler-Toledo International, Inc.\* | 558 | 705831 |
|  NanoString Technologies, Inc.\* | 3348 | 35020 |
|  NeoGenomics, Inc.\* | 3534 | 26876 |
|  Pacific Biosciences of California, Inc.\* (a) | 10602 | 89481 |
|  PerkinElmer, Inc.(a) | 2775 | 370685 |
|  Quanterix Corp.\* | 2418 | 26767 |
|  Repligen Corp.\* (a) | 1488 | 271545 |
|  SomaLogic, Inc.\* | 22692 | 78741 |
|  Sotera Health Co.\* | 5208 | 35831 |
|  Syneos Health, Inc.\* | 2046 | 103077 |
|  Thermo Fisher Scientific, Inc. | 10379 | 5334495 |
|  Waters Corp.\* | 1674 | 500811 |
|  West Pharmaceutical Services, Inc. | 1860 | 427986 |
|  |  | **17665094** |
| **Machinery – 2.2%** |  |  |
|  3D Systems Corp.\* (a) | 5580 | 49271 |
|  AGCO Corp. | 2604 | 323339 |
|  Alamo Group, Inc. | 372 | 56574 |
|  Albany International Corp., Class A(a) | 2232 | 204496 |
|  Allison Transmission Holdings, Inc. | 19795 | 836339 |

---

*See Accompanying Notes to the Financial Statements.* 

172 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Machinery – (continued)** |  |  |
|  Altra Industrial Motion Corp. | 14880 | $894883 |
|  Astec Industries, Inc. | 1674 | 73070 |
|  Barnes Group, Inc. | 1488 | 52631 |
|  Blue Bird Corp.\* (a) | 3720 | 34112 |
|  Caterpillar, Inc.(a) | 17484 | 3784587 |
|  Chart Industries, Inc.\* (a) | 2232 | 497468 |
|  CIRCOR International, Inc.\* | 2604 | 53825 |
|  Columbus McKinnon Corp. | 558 | 15914 |
|  Crane Holdings Co.(a) | 3348 | 335938 |
|  Cummins, Inc.(a) | 4650 | 1136972 |
|  Deere & Co. | 9114 | 3607504 |
|  Desktop Metal, Inc., Class A\* (a) | 372 | 941 |
|  Donaldson Co., Inc. | 7626 | 438114 |
|  Douglas Dynamics, Inc. | 372 | 12629 |
|  Dover Corp.(a) | 3720 | 486167 |
|  Energy Recovery, Inc.\* (a) | 185 | 4760 |
|  Enerpac Tool Group Corp. | 5208 | 132335 |
|  EnPro Industries, Inc.(a) | 1302 | 138663 |
|  ESCO Technologies, Inc. | 555 | 47824 |
|  Evoqua Water Technologies Corp.\* (a) | 5580 | 218624 |
|  Federal Signal Corp. | 1860 | 86769 |
|  Flowserve Corp.(a) | 7440 | 213379 |
|  Fortive Corp. | 8928 | 570499 |
|  Franklin Electric Co., Inc. | 1295 | 106112 |
|  Gates Industrial Corp. plc\* | 17670 | 197021 |
|  Gorman-Rupp Co. (The) | 1674 | 45432 |
|  Graco, Inc. | 5606 | 390066 |
|  Greenbrier Cos., Inc. (The)(a) | 4278 | 151056 |
|  Helios Technologies, Inc.(a) | 744 | 42177 |
|  Hillenbrand, Inc.(a) | 17112 | 756008 |
|  Hyliion Holdings Corp.\* (a) | 26784 | 76334 |
|  Hyster-Yale Materials Handling, Inc.(a) | 2046 | 59661 |
|  Ideanomics, Inc.\* (a) | 930 | 284 |
|  IDEX Corp. | 2405 | 534656 |
|  Illinois Tool Works, Inc. | 7812 | 1668096 |
|  Ingersoll Rand, Inc. | 9300 | 469650 |
|  ITT, Inc. | 4836 | 369422 |
|  John Bean Technologies Corp.(a) | 1488 | 135706 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Machinery – (continued)** |  |  |
|  Kadant, Inc.(a) | 372 | $66197 |
|  Kennametal, Inc.(a) | 5208 | 139106 |
|  Lincoln Electric Holdings, Inc. | 2035 | 288970 |
|  Lindsay Corp.(a) | 372 | 62980 |
|  Manitowoc Co., Inc. (The)\* | 3348 | 30534 |
|  Middleby Corp. (The)\* (a) | 1860 | 260140 |
|  Mueller Industries, Inc.(a) | 14043 | 879654 |
|  Mueller Water Products, Inc., Class A(a) | 5394 | 63110 |
|  Nikola Corp.\* (a) | 29045 | 110081 |
|  Nordson Corp. | 1302 | 292950 |
|  Oshkosh Corp.(a) | 15066 | 1325808 |
|  Otis Worldwide Corp. | 11346 | 801481 |
|  PACCAR, Inc.(a) | 10730 | 1038986 |
|  Parker-Hannifin Corp. | 3348 | 972996 |
|  Pentair plc | 4092 | 175751 |
|  Proterra, Inc.\* (a) | 17856 | 111421 |
|  Proto Labs, Inc.\* (a) | 1488 | 56827 |
|  RBC Bearings, Inc.\* (a) | 1674 | 424409 |
|  REV Group, Inc.(a) | 7068 | 97114 |
|  Snap-on, Inc.(a) | 1674 | 371712 |
|  SPX Technologies, Inc.\* (a) | 1488 | 97970 |
|  Standex International Corp.(a) | 186 | 18423 |
|  Stanley Black & Decker, Inc. | 5208 | 408776 |
|  Tennant Co.(a) | 2220 | 129315 |
|  Terex Corp. | 14694 | 595695 |
|  Timken Co. (The) | 14880 | 1060795 |
|  Toro Co. (The)(a) | 3348 | 352980 |
|  Trinity Industries, Inc.(a) | 2976 | 84905 |
|  Wabash National Corp. | 7068 | 153022 |
|  Watts Water Technologies, Inc., Class A(a) | 930 | 136115 |
|  Westinghouse Air Brake Technologies Corp. | 5022 | 468452 |
|  Xylem, Inc.(a) | 5394 | 552507 |
|  |  | **30938490** |
| **Marine – 0.1%** |  |  |
|  Eagle Bulk Shipping, Inc.(a) | 2418 | 116983 |
|  Genco Shipping & Trading Ltd. | 5766 | 77264 |
|  Kirby Corp.\* | 4255 | 296786 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 173

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Marine – (continued)** |  |  |
|  Matson, Inc. | 9805 | $721452 |
|  |  | **1212485** |
| **Media – 1.1%** |  |  |
|  Advantage Solutions, Inc.\* (a) | 30132 | 101846 |
|  Altice USA, Inc., Class A\* | 51430 | 339952 |
|  AMC Networks, Inc., Class A\* | 3162 | 71177 |
|  Cable One, Inc.(a) | 132 | 113445 |
|  Cardlytics, Inc.\* (a) | 2232 | 21048 |
|  Charter Communications, Inc., Class A\* | 3515 | 1292184 |
|  Clear Channel Outdoor Holdings, Inc.\* (a) | 101554 | 145222 |
|  Comcast Corp., Class A | 143375 | 4550723 |
|  DISH Network Corp., Class A\* (a) | 7998 | 119250 |
|  EW Scripps Co. (The), Class A\* (a) | 14694 | 208508 |
|  Fox Corp., Class A | 7998 | 230902 |
|  Fox Corp., Class B | 6845 | 186184 |
|  Gannett Co., Inc.\* (a) | 38315 | 55557 |
|  Gray Television, Inc. | 22015 | 311512 |
|  iHeartMedia, Inc., Class A\* (a) | 27528 | 227932 |
|  Interpublic Group of Cos., Inc. (The) | 11346 | 337997 |
|  John Wiley & Sons, Inc., Class A(a) | 10788 | 455146 |
|  Liberty Broadband Corp., Class A\* | 558 | 47609 |
|  Liberty Broadband Corp., Class C\* | 3906 | 329784 |
|  Liberty Media Corp-Liberty SiriusXM, Class A\* (a) | 2046 | 86832 |
|  Liberty Media Corp-Liberty SiriusXM, Class C\* | 4836 | 204031 |
|  Magnite, Inc.\* (a) | 30132 | 219662 |
|  New York Times Co. (The), Class A(a) | 10044 | 290874 |
|  News Corp., Class A | 9672 | 163167 |
|  News Corp., Class B(a) | 3162 | 54165 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Media – (continued)** |  |  |
|  Nexstar Media Group, Inc., Class A(a) | 9065 | $1552834 |
|  Omnicom Group, Inc. | 7068 | 514197 |
|  Paramount Global, Class A(a) | 1116 | 23525 |
|  Paramount Global, Class B(a) | 19716 | 361197 |
|  PubMatic, Inc., Class A\* (a) | 930 | 16182 |
|  Scholastic Corp.(a) | 744 | 28376 |
|  Sinclair Broadcast Group, Inc., Class A(a) | 12090 | 215323 |
|  Sirius XM Holdings, Inc.(a) | 30470 | 184039 |
|  TechTarget, Inc.\* (a) | 1116 | 72038 |
|  TEGNA, Inc. | 51893 | 1083526 |
|  Thryv Holdings, Inc.\* (a) | 4070 | 83272 |
|  Trade Desk, Inc. (The), Class A\* | 11346 | 604061 |
|  WideOpenWest, Inc.\* (a) | 6696 | 91802 |
|  |  | **14995081** |
| **Metals & Mining – 0.7%** |  |  |
|  Alcoa Corp. | 7254 | 283124 |
|  Alpha Metallurgical Resources, Inc. | 3534 | 596716 |
|  Arconic Corp.\* | 22692 | 471086 |
|  ATI, Inc.\* (a) | 9250 | 275280 |
|  Carpenter Technology Corp.(a) | 4440 | 166056 |
|  Century Aluminum Co.\* (a) | 10044 | 72417 |
|  Cleveland-Cliffs, Inc.\* (a) | 18972 | 246446 |
|  Coeur Mining, Inc.\* (a) | 6882 | 26014 |
|  Commercial Metals Co.(a) | 29143 | 1326007 |
|  Compass Minerals International, Inc. | 930 | 36772 |
|  Freeport-McMoRan, Inc. | 45755 | 1449976 |
|  Hecla Mining Co.(a) | 14880 | 68002 |
|  Kaiser Aluminum Corp.(a) | 1302 | 105189 |
|  Materion Corp.(a) | 558 | 47826 |
|  MP Materials Corp.\* (a) | 4278 | 128511 |
|  Newmont Corp. | 24738 | 1046912 |
|  Nucor Corp.(a) | 9114 | 1197397 |
|  Piedmont Lithium, Inc.\* (a) | 3348 | 208313 |
|  Reliance Steel & Aluminum Co. | 2418 | 487179 |

---

*See Accompanying Notes to the Financial Statements.* 

174 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Royal Gold, Inc. | 1480 | $| 140541 |
|  Ryerson Holding Corp. | 2035 |  | 68274 |
|  Schnitzer Steel Industries, Inc., Class A | 3515 |  | 94870 |
|  Southern Copper Corp.(a) | 1860 |  | 87364 |
|  Steel Dynamics, Inc.(a) | 6646 |  | 625056 |
|  SunCoke Energy, Inc.(a) | 8928 |  | 64817 |
|  TimkenSteel Corp.\* (a) | 9300 |  | 162192 |
|  United States Steel Corp.(a) | 9300 |  | 189348 |
|  Warrior Met Coal, Inc. | 9858 |  | 366126 |
|  Worthington Industries, Inc.(a) | 8140 |  | 387138 |
|  |  |  | **10424949** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.6%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.6%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.6%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.6%** |
|  AGNC Investment Corp.(a) | 121827 |  | 1001418 |
|  Annaly Capital Management, Inc.(a) | 11470 |  | 212769 |
|  Apollo Commercial Real Estate Finance, Inc.(a) | 31620 |  | 356041 |
|  Arbor Realty Trust, Inc.(a) | 37943 |  | 522475 |
|  Ares Commercial Real Estate Corp.(a) | 7030 |  | 86750 |
|  ARMOUR Residential REIT, Inc.(a) | 26085 |  | 138772 |
|  Blackstone Mortgage Trust, Inc., Class A(a) | 36075 |  | 900432 |
|  BrightSpire Capital, Inc.(a) | 17484 |  | 134277 |
|  Broadmark Realty Capital, Inc.(a) | 18870 |  | 109823 |
|  Chimera Investment Corp.(a) | 50963 |  | 344000 |
|  Dynex Capital, Inc.(a) | 5365 |  | 64058 |
|  Ellington Financial, Inc.(a) | 15996 |  | 214027 |
|  Granite Point Mortgage Trust, Inc.(a) | 20088 |  | 157892 |
|  Hannon Armstrong Sustainable Infrastructure Capital, Inc.(a) | 4092 |  | 111221 |
|  Invesco Mortgage Capital, Inc.(a) | 9301 |  | 108910 |
|  KKR Real Estate Finance Trust, Inc.(a) | 16182 |  | 281891 |
|  Ladder Capital Corp. | 7254 |  | 77400 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** |
|  MFA Financial, Inc.(a) | 19902 | $198224 |
|  New York Mortgage Trust, Inc.(a) | 82768 | 222646 |
|  Orchid Island Capital, Inc.(a) | 13503 | 135975 |
|  PennyMac Mortgage Investment Trust(a) | 15725 | 218106 |
|  Ready Capital Corp.(a) | 17760 | 215251 |
|  Redwood Trust, Inc.(a) | 22940 | 163562 |
|  Rithm Capital Corp.(a) | 107505 | 906267 |
|  Starwood Property Trust, Inc.(a) | 69190 | 1429465 |
|  TPG RE Finance Trust, Inc.(a) | 11532 | 97676 |
|  Two Harbors Investment Corp.(a) | 82024 | 292006 |
|  |  | **8701334** |
| **Multiline Retail – 0.5%** |  |  |
|  Big Lots, Inc.(a) | 4070 | 76801 |
|  Dillard's, Inc., Class A(a) | 424 | 139407 |
|  Dollar General Corp.(a) | 6290 | 1604265 |
|  Dollar Tree, Inc.\* (a) | 6132 | 971922 |
|  Franchise Group, Inc.(a) | 7812 | 237094 |
|  Kohl's Corp.(a) | 6138 | 183833 |
|  Macy's, Inc. | 10230 | 213295 |
|  Nordstrom, Inc.(a) | 24552 | 499388 |
|  Ollie's Bargain Outlet Holdings, Inc.\* (a) | 3348 | 187488 |
|  Target Corp. | 15066 | 2474590 |
|  |  | **6588083** |
| **Multi-Utilities – 0.7%** |  |  |
|  Ameren Corp. | 6510 | 530695 |
|  Avista Corp.(a) | 2790 | 114474 |
|  Black Hills Corp. | 4413 | 288478 |
|  CenterPoint Energy, Inc.(a) | 18870 | 539871 |
|  CMS Energy Corp. | 8184 | 466897 |
|  Consolidated Edison, Inc. | 10915 | 960083 |
|  Dominion Energy, Inc. | 26640 | 1864001 |
|  DTE Energy Co. | 5735 | 642951 |
|  NiSource, Inc. | 13231 | 339904 |
|  NorthWestern Corp.(a) | 12090 | 638715 |
|  Public Service Enterprise Group, Inc. | 14245 | 798717 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 175

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Multi-Utilities – (continued)** |  |  |  |
|  Sempra Energy | 9990 | $| 1507891 |
|  Unitil Corp. | 2220 |  | 117016 |
|  WEC Energy Group, Inc. | 8556 |  | 781419 |
|  |  |  | **9591112** |
| **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** |
|  Antero Midstream Corp.(a) | 78862 |  | 839880 |
|  Antero Resources Corp.\* (a) | 10915 |  | 400144 |
|  APA Corp.(a) | 12395 |  | 563477 |
|  Arch Resources, Inc. | 4278 |  | 651497 |
|  Archaea Energy, Inc.\* | 4625 |  | 119371 |
|  Berry Corp. | 12834 |  | 113837 |
|  Brigham Minerals, Inc., Class A(a) | 5365 |  | 166315 |
|  California Resources Corp.(a) | 15540 |  | 701009 |
|  Callon Petroleum Co.\* (a) | 10788 |  | 474240 |
|  Centrus Energy Corp., Class A\* (a) | 2046 |  | 96796 |
|  Cheniere Energy, Inc. | 8370 |  | 1476552 |
|  Chesapeake Energy Corp.(a) | 3924 |  | 401307 |
|  Chevron Corp. | 59940 |  | 10843146 |
|  Chord Energy Corp.(a) | 8875 |  | 1358674 |
|  Civitas Resources, Inc. | 12765 |  | 892407 |
|  Clean Energy Fuels Corp.\* (a) | 3162 |  | 21217 |
|  CNX Resources Corp.\* | 46620 |  | 783682 |
|  Comstock Resources, Inc.\* (a) | 17856 |  | 335336 |
|  ConocoPhillips | 42593 |  | 5370551 |
|  CONSOL Energy, Inc. | 6290 |  | 396396 |
|  Continental Resources, Inc.(a) | 2851 |  | 210888 |
|  Coterra Energy, Inc.(a) | 26971 |  | 839606 |
|  Crescent Energy Co., Class A | 2790 |  | 38446 |
|  CVR Energy, Inc.(a) | 8695 |  | 339627 |
|  Delek US Holdings, Inc.(a) | 6290 |  | 186561 |
|  Denbury, Inc.\* | 10360 |  | 947008 |
|  Devon Energy Corp. | 20720 |  | 1602692 |
|  Diamondback Energy, Inc.(a) | 6324 |  | 993564 |
|  Dorian LPG Ltd. | 8370 |  | 151246 |
|  DT Midstream, Inc. | 21948 |  | 1310296 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Earthstone Energy, Inc., Class A\* (a) | 6324 | $102196 |
|  Enviva, Inc.(a) | 555 | 33211 |
|  EOG Resources, Inc. | 18870 | 2576132 |
|  EQT Corp. | 12090 | 505846 |
|  Equitrans Midstream Corp.(a) | 90465 | 761715 |
|  Excelerate Energy, Inc., Class A(a) | 3906 | 107884 |
|  Exxon Mobil Corp. | 137640 | 15251888 |
|  Gevo, Inc.\* (a) | 372 | 837 |
|  Gran Tierra Energy, Inc.\* (a) | 54125 | 73069 |
|  Green Plains, Inc.\* (a) | 5022 | 145085 |
|  Gulfport Energy Corp.\* (a) | 1295 | 115915 |
|  Hess Corp. | 7955 | 1122291 |
|  HF Sinclair Corp. | 31992 | 1956951 |
|  International Seaways, Inc.(a) | 3720 | 157765 |
|  Kinder Morgan, Inc.(a) | 61605 | 1116283 |
|  Kosmos Energy Ltd.\* (a) | 97276 | 631321 |
|  Laredo Petroleum, Inc.\* (a) | 2960 | 191364 |
|  Magnolia Oil & Gas Corp., Class A(a) | 34965 | 897901 |
|  Marathon Oil Corp. | 24975 | 760489 |
|  Marathon Petroleum Corp. | 16926 | 1923132 |
|  Matador Resources Co.(a) | 24738 | 1643840 |
|  Murphy Oil Corp.(a) | 32364 | 1569978 |
|  New Fortress Energy, Inc.(a) | 2604 | 143402 |
|  NextDecade Corp.\* (a) | 3348 | 23436 |
|  Northern Oil and Gas, Inc.(a) | 13505 | 461061 |
|  Occidental Petroleum Corp.(a) | 25715 | 1866909 |
|  ONEOK, Inc.(a) | 13690 | 812091 |
|  Ovintiv, Inc.(a) | 9818 | 497282 |
|  Par Pacific Holdings, Inc.\* | 6845 | 156614 |
|  PBF Energy, Inc., Class A\* (a) | 21948 | 971199 |
|  PDC Energy, Inc. | 22755 | 1641546 |
|  Peabody Energy Corp.\* (a) | 25854 | 617911 |
|  Permian Resources Corp.\* (a) | 38687 | 377972 |
|  Phillips 66(a) | 14985 | 1562786 |
|  Pioneer Natural Resources Co.(a) | 7585 | 1944870 |

---

*See Accompanying Notes to the Financial Statements.* 

176 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Range Resources Corp. | 15355 | $| 437310 |
|  Ranger Oil Corp. | 5394 |  | 220615 |
|  Ring Energy, Inc.\* (a) | 15252 |  | 48654 |
|  SilverBow Resources, Inc.\* (a) | 1110 |  | 39372 |
|  SM Energy Co. | 26270 |  | 1181625 |
|  Southwestern Energy Co.\* | 45510 |  | 315384 |
|  Talos Energy, Inc.\* | 11655 |  | 248018 |
|  Targa Resources Corp. | 7030 |  | 480641 |
|  Tellurian, Inc.\* (a) | 15810 |  | 42687 |
|  Texas Pacific Land Corp.(a) | 186 |  | 428520 |
|  Uranium Energy Corp.\* (a) | 3534 |  | 14878 |
|  Valero Energy Corp. | 12648 |  | 1587956 |
|  W&T Offshore, Inc.\* (a) | 30895 |  | 234493 |
|  Williams Cos., Inc. (The) | 34410 |  | 1126239 |
|  World Fuel Services Corp.(a) | 13206 |  | 336621 |
|  |  |  | **82090953** |
| **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** |
|  Clearwater Paper Corp.\* | 2418 |  | 107553 |
|  Glatfelter Corp.(a) | 7068 |  | 20002 |
|  Louisiana-Pacific Corp.(a) | 18107 |  | 1025762 |
|  Mercer International, Inc. | 10416 |  | 139783 |
|  Resolute Forest Products, Inc.\* (a) | 6882 |  | 143214 |
|  Sylvamo Corp. | 6324 |  | 304627 |
|  |  |  | **1740941** |
| **Personal Products – 0.2%** |  |  |  |
|  Beauty Health Co. (The)\* (a) | 5766 |  | 65905 |
|  BellRing Brands, Inc.\* (a) | 5208 |  | 126138 |
|  Coty, Inc., Class A\* (a) | 21948 |  | 147271 |
|  Edgewell Personal Care Co.(a) | 4637 |  | 181724 |
|  elf Beauty, Inc.\* | 744 |  | 32185 |
|  Estee Lauder Cos., Inc. (The), Class A | 5920 |  | 1186901 |
|  Herbalife Nutrition Ltd.\* (a) | 21275 |  | 452307 |
|  Honest Co., Inc. (The)\* | 2976 |  | 9851 |
|  Inter Parfums, Inc.(a) | 558 |  | 45131 |
|  Medifast, Inc. | 558 |  | 65280 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Personal Products – (continued)** | **Personal Products – (continued)** | **Personal Products – (continued)** |
|  Nu Skin Enterprises, Inc., Class A(a) | 12090 | $461717 |
|  USANA Health Sciences, Inc.\* | 186 | 9767 |
|  Veru, Inc.\* (a) | 186 | 2277 |
|  |  | **2786454** |
| **Pharmaceuticals – 3.6%** |  |  |
|  Aclaris Therapeutics, Inc.\* | 744 | 11614 |
|  Amneal Pharmaceuticals, Inc.\* (a) | 35339 | 77746 |
|  Amphastar Pharmaceuticals, Inc.\* (a) | 1116 | 34484 |
|  ANI Pharmaceuticals, Inc.\* (a) | 186 | 7178 |
|  Arvinas, Inc.\* (a) | 3348 | 166429 |
|  Atea Pharmaceuticals, Inc.\* (a) | 14880 | 89280 |
|  Axsome Therapeutics, Inc.\* (a) | 1860 | 83979 |
|  Bristol-Myers Squibb Co. | 70306 | 5446606 |
|  Cara Therapeutics, Inc.\* (a) | 1116 | 10490 |
|  Cassava Sciences, Inc.\* (a) | 9300 | 338892 |
|  Catalent, Inc.\* | 5022 | 330096 |
|  Collegium Pharmaceutical, Inc.\* | 10230 | 183526 |
|  Corcept Therapeutics, Inc.\* (a) | 5022 | 143629 |
|  DICE Therapeutics, Inc.\* (a) | 1302 | 46234 |
|  Elanco Animal Health, Inc.\* | 15066 | 198721 |
|  Eli Lilly & Co. | 21018 | 7610408 |
|  Evolus, Inc.\* (a) | 2046 | 17514 |
|  Harmony Biosciences Holdings, Inc.\* (a) | 744 | 38688 |
|  Innoviva, Inc.\* (a) | 10416 | 141241 |
|  Intra-Cellular Therapies, Inc.\* | 4836 | 220860 |
|  Jazz Pharmaceuticals plc\* | 1860 | 267449 |
|  Johnson & Johnson | 69190 | 12036984 |
|  Merck & Co., Inc. | 84070 | 8507884 |
|  Nektar Therapeutics\* | 7812 | 29373 |
|  NGM Biopharmaceuticals, Inc.\* (a) | 1488 | 7946 |
|  Organon & Co.(a) | 6882 | 180171 |
|  Pacira BioSciences, Inc.\* (a) | 1295 | 67029 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 177

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Perrigo Co. plc | 28675 | $| 1155029 |
|  Pfizer, Inc. | 185623 |  | 8640751 |
|  Phibro Animal Health Corp., Class A | 2046 |  | 30056 |
|  Prestige Consumer Healthcare, Inc.\* | 12580 |  | 685358 |
|  Reata Pharmaceuticals, Inc., Class A\* (a) | 2232 |  | 71870 |
|  Relmada Therapeutics, Inc.\* (a) | 7955 |  | 50833 |
|  Revance Therapeutics, Inc.\* | 3162 |  | 70544 |
|  Royalty Pharma plc, Class A | 13392 |  | 566749 |
|  SIGA Technologies, Inc.(a) | 8742 |  | 80339 |
|  Supernus Pharmaceuticals, Inc.\* (a) | 4810 |  | 164839 |
|  Tilray Brands, Inc.\* | 123687 |  | 503406 |
|  Viatris, Inc. | 38129 |  | 386247 |
|  Zoetis, Inc. | 12648 |  | 1907066 |
|  |  |  | **50607538** |
| **Professional Services – 0.8%** | **Professional Services – 0.8%** | **Professional Services – 0.8%** | **Professional Services – 0.8%** |
|  Alight, Inc., Class A\* (a) | 16740 |  | 138775 |
|  ASGN, Inc.\* (a) | 3348 |  | 283843 |
|  Barrett Business Services, Inc. | 930 |  | 81115 |
|  Booz Allen Hamilton Holding Corp. | 3348 |  | 364430 |
|  CACI International, Inc., Class A\* | 5550 |  | 1687366 |
|  CBIZ, Inc.\* | 1860 |  | 92330 |
|  Clarivate plc\* (a) | 8556 |  | 88383 |
|  CoStar Group, Inc.\* | 10915 |  | 902889 |
|  Dun & Bradstreet Holdings, Inc. | 2405 |  | 30904 |
|  Equifax, Inc.(a) | 3162 |  | 536085 |
|  Exponent, Inc. | 2035 |  | 193854 |
|  First Advantage Corp.\* (a) | 744 |  | 10453 |
|  Forrester Research, Inc.\* | 186 |  | 7872 |
|  FTI Consulting, Inc.\* (a) | 1674 |  | 260525 |
|  Heidrick & Struggles International, Inc. | 5208 |  | 146657 |
|  Huron Consulting Group, Inc.\* | 558 |  | 41086 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** |
|  ICF International, Inc.(a) | 558 | $| 66754 |
|  Insperity, Inc. | 1295 |  | 152836 |
|  Jacobs Solutions, Inc. | 3885 |  | 447630 |
|  KBR, Inc.(a) | 8742 |  | 435089 |
|  Kelly Services, Inc., Class A | 8184 |  | 133727 |
|  Kforce, Inc. | 372 |  | 23536 |
|  Korn Ferry(a) | 12276 |  | 682423 |
|  Leidos Holdings, Inc. | 3906 |  | 396811 |
|  ManpowerGroup, Inc. | 12090 |  | 947131 |
|  Planet Labs PBC\* | 11718 |  | 61519 |
|  Resources Connection, Inc.(a) | 5952 |  | 108743 |
|  Robert Half International, Inc. | 3720 |  | 284431 |
|  Science Applications International Corp.(a) | 11840 |  | 1282746 |
|  Sterling Check Corp.\* (a) | 744 |  | 14530 |
|  TransUnion | 5022 |  | 297654 |
|  TriNet Group, Inc.\* | 1302 |  | 84604 |
|  TrueBlue, Inc.\* | 2604 |  | 51195 |
|  Upwork, Inc.\* | 8370 |  | 112576 |
|  Verisk Analytics, Inc. | 4092 |  | 748140 |
|  |  |  | **11198642** |
| **Real Estate Management & Development – 0.2%** | **Real Estate Management & Development – 0.2%** | **Real Estate Management & Development – 0.2%** | **Real Estate Management & Development – 0.2%** |
|  Anywhere Real Estate, Inc.\* (a) | 30504 |  | 226645 |
|  CBRE Group, Inc., Class A\* | 10788 |  | 765301 |
|  Cushman & Wakefield plc\* (a) | 34038 |  | 393139 |
|  DigitalBridge Group, Inc. | 6464 |  | 82739 |
|  Doma Holdings, Inc.\* (a) | 63983 |  | 34717 |
|  Douglas Elliman, Inc.(a) | 22320 |  | 103118 |
|  eXp World Holdings, Inc.(a) | 2790 |  | 36856 |
|  Forestar Group, Inc.\* (a) | 9114 |  | 105540 |
|  Howard Hughes Corp. (The)\* | 2220 |  | 136197 |
|  Jones Lang LaSalle, Inc.\* | 2035 |  | 323748 |
|  Kennedy-Wilson Holdings, Inc. | 7998 |  | 132847 |
|  Newmark Group, Inc., Class A | 35711 |  | 292473 |
|  Offerpad Solutions, Inc.\* (a) | 22878 |  | 22294 |
|  Opendoor Technologies, Inc.\* (a) | 130055 |  | 336842 |

---

*See Accompanying Notes to the Financial Statements.* 

178 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  RE/MAX Holdings, Inc., Class A | 7585 | $147604 |
|  Redfin Corp.\* (a) | 5580 | 26840 |
|  RMR Group, Inc. (The), Class A(a) | 372 | 10182 |
|  Seritage Growth Properties, Class A, REIT\* (a) | 14508 | 155671 |
|  St Joe Co. (The)(a) | 558 | 19826 |
|  WeWork, Inc.\* (a) | 12090 | 31071 |
|  Zillow Group, Inc., Class A\* | 558 | 17259 |
|  Zillow Group, Inc., Class C\* (a) | 5208 | 160719 |
|  |  | **3561628** |
| **Road & Rail – 1.0%** |  |  |
|  AMERCO | 186 | 106985 |
|  ArcBest Corp.(a) | 5208 | 413672 |
|  Avis Budget Group, Inc.\* (a) | 1379 | 326078 |
|  CSX Corp. | 56729 | 1648545 |
|  Daseke, Inc.\* (a) | 10416 | 62079 |
|  Heartland Express, Inc.(a) | 5766 | 85798 |
|  Hertz Global Holdings, Inc.\* (a) | 2220 | 40848 |
|  JB Hunt Transport Services, Inc. | 2232 | 381828 |
|  Knight-Swift Transportation Holdings, Inc.(a) | 4836 | 232273 |
|  Landstar System, Inc.(a) | 1860 | 290569 |
|  Lyft, Inc., Class A\* (a) | 8184 | 119814 |
|  Marten Transport Ltd. | 2790 | 52368 |
|  Norfolk Southern Corp. | 6475 | 1476753 |
|  Old Dominion Freight Line, Inc. | 2604 | 715059 |
|  Ryder System, Inc.(a) | 10788 | 868542 |
|  Saia, Inc.\* (a) | 1302 | 258916 |
|  Schneider National, Inc., Class B | 5208 | 115826 |
|  Uber Technologies, Inc.\* | 66970 | 1779393 |
|  Union Pacific Corp. | 16280 | 3209439 |
|  Werner Enterprises, Inc. | 11470 | 449624 |
|  XPO Logistics, Inc.\* (a) | 24605 | 1273063 |
|  |  | **13907472** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Semiconductors & Semiconductor Equipment – 3.7%** | **Semiconductors & Semiconductor Equipment – 3.7%** | **Semiconductors & Semiconductor Equipment – 3.7%** |
|  ACM Research, Inc., Class A\* | 1116 | $7142 |
|  Advanced Micro Devices, Inc.\* | 43337 | 2602820 |
|  Allegro MicroSystems, Inc.\* | 372 | 9453 |
|  Alpha & Omega Semiconductor Ltd.\* (a) | 5766 | 188837 |
|  Ambarella, Inc.\* (a) | 1674 | 91618 |
|  Amkor Technology, Inc.(a) | 20460 | 425363 |
|  Analog Devices, Inc. | 14136 | 2016076 |
|  Applied Materials, Inc. | 23865 | 2107041 |
|  Axcelis Technologies, Inc.\* | 1116 | 64728 |
|  Broadcom, Inc. | 13392 | 6295847 |
|  CEVA, Inc.\* | 3348 | 92606 |
|  Cirrus Logic, Inc.\* (a) | 2976 | 199749 |
|  Cohu, Inc.\* (a) | 1302 | 42862 |
|  Diodes, Inc.\* (a) | 10044 | 719854 |
|  Enphase Energy, Inc.\* | 3534 | 1084938 |
|  Entegris, Inc. | 4205 | 333625 |
|  First Solar, Inc.\* | 2035 | 296235 |
|  FormFactor, Inc.\* | 2418 | 48868 |
|  Ichor Holdings Ltd.\* (a) | 8184 | 208201 |
|  Impinj, Inc.\* (a) | 1488 | 170569 |
|  Intel Corp. | 135777 | 3860140 |
|  KLA Corp. | 3906 | 1236054 |
|  Kulicke & Soffa Industries, Inc.(a) | 13392 | 561660 |
|  Lam Research Corp. | 3720 | 1505782 |
|  Lattice Semiconductor Corp.\* | 4650 | 225572 |
|  MACOM Technology Solutions Holdings, Inc.\* | 1488 | 86111 |
|  Magnachip Semiconductor Corp.\* | 5394 | 53670 |
|  Marvell Technology, Inc. | 22506 | 893038 |
|  MaxLinear, Inc.\* | 3534 | 109130 |
|  Microchip Technology, Inc.(a) | 13505 | 833799 |
|  Micron Technology, Inc. | 36827 | 1992341 |
|  MKS Instruments, Inc. | 3348 | 275038 |
|  Monolithic Power Systems, Inc.(a) | 1116 | 378826 |
|  NVIDIA Corp. | 66587 | 8987247 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 179

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Semiconductors a& Semiconductor Equipment – (continued)** | **Semiconductors a& Semiconductor Equipment – (continued)** | **Semiconductors a& Semiconductor Equipment – (continued)** |
|  NXP Semiconductors NV | 8742 | $1277031 |
|  ON Semiconductor Corp.\* (a) | 12462 | 765541 |
|  Onto Innovation, Inc.\* (a) | 3348 | 223780 |
|  PDF Solutions, Inc.\* (a) | 372 | 8772 |
|  Photronics, Inc.\* (a) | 16182 | 262472 |
|  Power Integrations, Inc. | 3162 | 210937 |
|  Qorvo, Inc.\* | 4092 | 352239 |
|  QUALCOMM, Inc. | 37199 | 4376834 |
|  Rambus, Inc.\* (a) | 3720 | 112195 |
|  Semtech Corp.\* | 3534 | 97856 |
|  Silicon Laboratories, Inc.\* (a) | 2035 | 233862 |
|  SiTime Corp.\* (a) | 558 | 50114 |
|  Skyworks Solutions, Inc. | 4836 | 415944 |
|  SMART Global Holdings, Inc.\* (a) | 9300 | 125829 |
|  SolarEdge Technologies, Inc.\* (a) | 1488 | 342285 |
|  Synaptics, Inc.\* | 1674 | 148316 |
|  Teradyne, Inc.(a) | 4650 | 378278 |
|  Texas Instruments, Inc. | 24552 | 3943788 |
|  Ultra Clean Holdings, Inc.\* | 11160 | 347188 |
|  Universal Display Corp.(a) | 2790 | 265664 |
|  Veeco Instruments, Inc.\* (a) | 1488 | 27126 |
|  Wolfspeed, Inc.\* (a) | 3720 | 292950 |
|  |  | **52263841** |
| **Software – 6.5%** |  |  |
|  8x8, Inc.\* (a) | 2790 | 11802 |
|  ACI Worldwide, Inc.\* (a) | 5394 | 131236 |
|  Adeia, Inc.(a) | 22570 | 252333 |
|  Adobe, Inc.\* | 12210 | 3888885 |
|  Agilysys, Inc.\* | 372 | 23871 |
|  Alarm.com Holdings, Inc.\* (a) | 3534 | 207941 |
|  Altair Engineering, Inc., Class A\* (a) | 1302 | 63863 |
|  Alteryx, Inc., Class A\* (a) | 4255 | 207346 |
|  American Software, Inc., Class A(a) | 1302 | 22303 |
|  Amplitude, Inc., Class A\* (a) | 1674 | 28123 |
|  ANSYS, Inc.\* | 2590 | 572804 |
|  Appfolio, Inc., Class A\* (a) | 1665 | 208741 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Software – (continued)** |  |  |
|  Appian Corp., Class A\* (a) | 2232 | $108966 |
|  AppLovin Corp., Class A\* (a) | 372 | 6309 |
|  Asana, Inc., Class A\* (a) | 5394 | 111116 |
|  Aspen Technology, Inc.\* (a) | 930 | 224549 |
|  Autodesk, Inc.\* | 5952 | 1275514 |
|  Avaya Holdings Corp.\* (a) | 19158 | 30270 |
|  Bentley Systems, Inc., Class B(a) | 4278 | 150928 |
|  Bill.com Holdings, Inc.\* (a) | 2232 | 297660 |
|  Black Knight, Inc.\* | 3348 | 202454 |
|  Blackbaud, Inc.\* (a) | 2976 | 162787 |
|  Blackline, Inc.\* (a) | 3348 | 187488 |
|  Box, Inc., Class A\* (a) | 5394 | 156696 |
|  BTRS Holdings, Inc., Class 1\* (a) | 10044 | 94815 |
|  C3.ai, Inc., Class A\* (a) | 6510 | 85346 |
|  Cadence Design Systems, Inc.\* | 7254 | 1098183 |
|  Cerence, Inc.\* (a) | 1116 | 19195 |
|  Ceridian HCM Holding, Inc.\* (a) | 5180 | 342864 |
|  ChannelAdvisor Corp.\* | 3720 | 85709 |
|  Clear Secure, Inc., Class A\* (a) | 1488 | 40206 |
|  Clearwater Analytics Holdings, Inc., Class A\* (a) | 1674 | 27269 |
|  CommVault Systems, Inc.\* (a) | 2976 | 181209 |
|  Confluent, Inc., Class A\* (a) | 7254 | 194988 |
|  Consensus Cloud Solutions, Inc.\* (a) | 3720 | 208841 |
|  Coupa Software, Inc.\* | 5022 | 267321 |
|  Crowdstrike Holdings, Inc., Class A\* | 5766 | 929479 |
|  CS Disco, Inc.\* (a) | 930 | 9970 |
|  Datadog, Inc., Class A\* | 7215 | 580880 |
|  Digimarc Corp.\* (a) | 744 | 12157 |
|  Digital Turbine, Inc.\* | 6510 | 95046 |
|  DocuSign, Inc.\* (a) | 5208 | 251546 |
|  Dolby Laboratories, Inc., Class A | 4278 | 285942 |
|  DoubleVerify Holdings, Inc.\* (a) | 744 | 21747 |
|  Dropbox, Inc., Class A\* (a) | 15996 | 347913 |

---

*See Accompanying Notes to the Financial Statements.* 

180 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Software – (continued)** |  |  |
|  Duck Creek Technologies, Inc.\* | 5952 | $71067 |
|  Dynatrace, Inc.\* (a) | 7030 | 247737 |
|  E2open Parent Holdings, Inc.\* (a) | 13950 | 81329 |
|  Ebix, Inc.(a) | 1860 | 36809 |
|  Elastic NV\* | 2604 | 166526 |
|  Enfusion, Inc., Class A\* | 744 | 10542 |
|  Envestnet, Inc.\* | 1850 | 91224 |
|  Everbridge, Inc.\* | 2418 | 75756 |
|  Fair Isaac Corp.\* (a) | 744 | 356257 |
|  Five9, Inc.\* | 1860 | 112084 |
|  Fortinet, Inc.\* | 17670 | 1010017 |
|  Freshworks, Inc., Class A\* (a) | 2790 | 37916 |
|  Gitlab, Inc., Class A\* (a) | 2418 | 117176 |
|  Guidewire Software, Inc.\* | 3330 | 197835 |
|  HashiCorp, Inc., Class A\* (a) | 2976 | 91452 |
|  HubSpot, Inc.\* | 1116 | 330961 |
|  Intapp, Inc.\* | 744 | 16710 |
|  InterDigital, Inc. | 2604 | 129862 |
|  Intuit, Inc. | 7626 | 3260115 |
|  Jamf Holding Corp.\* (a) | 3906 | 92455 |
|  JFrog Ltd.\* (a) | 4092 | 103937 |
|  KnowBe4, Inc., Class A\* | 4650 | 114297 |
|  LivePerson, Inc.\* (a) | 4650 | 49151 |
|  LiveRamp Holdings, Inc.\* | 3534 | 64884 |
|  Manhattan Associates, Inc.\* | 2220 | 270107 |
|  Marathon Digital Holdings, Inc.\* (a) | 28086 | 368207 |
|  Matterport, Inc.\* (a) | 18972 | 66212 |
|  Microsoft Corp. | 197210 | 45778357 |
|  MicroStrategy, Inc., Class A\* (a) | 372 | 99514 |
|  Mitek Systems, Inc.\* (a) | 930 | 10518 |
|  Model N, Inc.\* (a) | 744 | 28272 |
|  Momentive Global, Inc.\* | 10602 | 82272 |
|  N-able, Inc.\* (a) | 2976 | 32230 |
|  nCino, Inc.\* (a) | 3906 | 122961 |
|  NCR Corp.\* (a) | 29760 | 632698 |
|  New Relic, Inc.\* | 3534 | 209354 |
|  NortonLifeLock, Inc.(a) | 13578 | 305912 |
|  Nutanix, Inc., Class A\* | 14136 | 387326 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Software – (continued)** |  |  |
|  Olo, Inc., Class A\* (a) | 3720 | $32773 |
|  OneSpan, Inc.\* | 1488 | 16353 |
|  Oracle Corp. | 41255 | 3220778 |
|  PagerDuty, Inc.\* (a) | 4464 | 111332 |
|  Palantir Technologies, Inc., Class A\* (a) | 49475 | 434885 |
|  Palo Alto Networks, Inc.\* (a) | 8325 | 1428487 |
|  Paycom Software, Inc.\* | 1302 | 450492 |
|  Paycor HCM, Inc.\* | 1116 | 34005 |
|  Paylocity Holding Corp.\* | 1116 | 258678 |
|  Pegasystems, Inc.(a) | 3348 | 124579 |
|  Progress Software Corp.(a) | 740 | 37762 |
|  PROS Holdings, Inc.\* | 2232 | 55688 |
|  PTC, Inc.\* | 2418 | 284913 |
|  Q2 Holdings, Inc.\* (a) | 3162 | 98148 |
|  Qualtrics International, Inc., Class A\* (a) | 9114 | 109095 |
|  Qualys, Inc.\* (a) | 1488 | 212129 |
|  Rapid7, Inc.\* (a) | 4440 | 200999 |
|  RingCentral, Inc., Class A\* | 2418 | 85887 |
|  Riot Blockchain, Inc.\* (a) | 30132 | 207610 |
|  Roper Technologies, Inc. | 2590 | 1073659 |
|  Salesforce, Inc.\* | 26598 | 4324569 |
|  SentinelOne, Inc., Class A\* (a) | 10974 | 250646 |
|  ServiceNow, Inc.\* | 5330 | 2242544 |
|  Smartsheet, Inc., Class A\* (a) | 8742 | 305271 |
|  Splunk, Inc.\* | 3720 | 309169 |
|  Sprinklr, Inc., Class A\* | 1674 | 15485 |
|  Sprout Social, Inc., Class A\* (a) | 2418 | 145878 |
|  SPS Commerce, Inc.\* | 1295 | 163843 |
|  Sumo Logic, Inc.\* | 5394 | 41588 |
|  Synopsys, Inc.\* | 3906 | 1142700 |
|  Tenable Holdings, Inc.\* (a) | 5394 | 219212 |
|  Teradata Corp.\* (a) | 5580 | 176272 |
|  Tyler Technologies, Inc.\* | 925 | 299080 |
|  UiPath, Inc., Class A\* | 7254 | 91763 |
|  Unity Software, Inc.\* (a) | 4092 | 120714 |
|  Upland Software, Inc.\* | 5208 | 41872 |
|  Varonis Systems, Inc.\* (a) | 6882 | 184231 |
|  Verint Systems, Inc.\* | 2046 | 72490 |
|  Veritone, Inc.\* (a) | 2046 | 15161 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 181

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Software – (continued)** |  |  |
|  Vertex, Inc., Class A\* (a) | 2976 | $53628 |
|  VMware, Inc., Class A | 6696 | 753501 |
|  Workday, Inc., Class A\* | 4810 | 749494 |
|  Workiva, Inc.\* (a) | 1674 | 130254 |
|  Yext, Inc.\* | 185 | 984 |
|  Zendesk, Inc.\* | 2790 | 213965 |
|  Zoom Video Communications, Inc., Class A\* (a) | 6510 | 543194 |
|  Zscaler, Inc.\* (a) | 1860 | 286626 |
|  Zuora, Inc., Class A\* | 9858 | 75808 |
|  |  | **90422844** |
| **Specialty Retail – 2.5%** |  |  |
|  Aaron's Co., Inc. (The) | 4278 | 44577 |
|  Abercrombie & Fitch Co., Class A\* | 7955 | 139849 |
|  Academy Sports & Outdoors, Inc.(a) | 18972 | 835337 |
|  Advance Auto Parts, Inc.(a) | 1860 | 353251 |
|  American Eagle Outfitters, Inc.(a) | 34224 | 388785 |
|  America's Car-Mart, Inc.\* (a) | 1488 | 101720 |
|  Arko Corp.(a) | 2790 | 28598 |
|  Asbury Automotive Group, Inc.\* (a) | 4836 | 762879 |
|  AutoNation, Inc.\* | 1850 | 196673 |
|  AutoZone, Inc.\* | 555 | 1405748 |
|  Bath & Body Works, Inc.(a) | 7998 | 266973 |
|  Best Buy Co., Inc.(a) | 7440 | 508970 |
|  Boot Barn Holdings, Inc.\* (a) | 1488 | 84518 |
|  Buckle, Inc. (The)(a) | 7068 | 277984 |
|  Burlington Stores, Inc.\* (a) | 1674 | 239315 |
|  Caleres, Inc.(a) | 7812 | 213502 |
|  Camping World Holdings, Inc., Class A(a) | 6660 | 185348 |
|  CarMax, Inc.\* (a) | 4836 | 304716 |
|  Carvana Co.\* (a) | 6510 | 88080 |
|  Chico's FAS, Inc.\* (a) | 25296 | 148740 |
|  Children's Place, Inc. (The)\* (a) | 3348 | 135527 |
|  Conn's, Inc.\* (a) | 3534 | 29014 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Container Store Group, Inc. (The)\* (a) | 7998 | $43429 |
|  Designer Brands, Inc., Class A | 12276 | 186963 |
|  Dick's Sporting Goods, Inc.(a) | 13505 | 1536329 |
|  EVgo, Inc.\* (a) | 3906 | 28943 |
|  Five Below, Inc.\* (a) | 1116 | 163327 |
|  Floor & Decor Holdings, Inc., Class A\* (a) | 2232 | 163762 |
|  Foot Locker, Inc. | 16280 | 516076 |
|  GameStop Corp., Class A\* (a) | 8184 | 231689 |
|  Gap, Inc. (The)(a) | 48917 | 551295 |
|  Genesco, Inc.\* (a) | 2232 | 104993 |
|  Group 1 Automotive, Inc.(a) | 4015 | 694595 |
|  Guess?, Inc.(a) | 7254 | 123173 |
|  Haverty Furniture Cos., Inc. | 2046 | 54383 |
|  Hibbett, Inc. | 2418 | 150932 |
|  Home Depot, Inc. (The) | 27010 | 7998471 |
|  JOANN, Inc.(a) | 1488 | 7872 |
|  Leslie's, Inc.\* (a) | 8928 | 125349 |
|  Lithia Motors, Inc., Class A(a) | 1110 | 219946 |
|  LL Flooring Holdings, Inc.\* (a) | 6510 | 54163 |
|  Lowe's Cos., Inc. | 21460 | 4183627 |
|  MarineMax, Inc.\* (a) | 6138 | 198319 |
|  Monro, Inc.(a) | 558 | 26645 |
|  Murphy USA, Inc.(a) | 1404 | 441572 |
|  National Vision Holdings, Inc.\* (a) | 3348 | 124010 |
|  ODP Corp. (The)\* | 11670 | 461782 |
|  OneWater Marine, Inc., Class A\* (a) | 744 | 24552 |
|  O'Reilly Automotive, Inc.\* | 1801 | 1507743 |
|  Penske Automotive Group, Inc.(a) | 1521 | 169774 |
|  Petco Health & Wellness Co., Inc.\* (a) | 3534 | 37213 |
|  Rent-A-Center, Inc.(a) | 13392 | 279223 |
|  RH\* (a) | 558 | 141693 |
|  Ross Stores, Inc. | 8742 | 836522 |
|  Sally Beauty Holdings, Inc.\* (a) | 23436 | 297872 |
|  Shoe Carnival, Inc.(a) | 2976 | 71364 |

---

*See Accompanying Notes to the Financial Statements.* 

182 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Signet Jewelers Ltd.(a) | 9486 | $| 618867 |
|  Sleep Number Corp.\* (a) | 5022 |  | 139310 |
|  Sonic Automotive, Inc., Class A(a) | 5705 |  | 266709 |
|  Sportsman's Warehouse Holdings, Inc.\* (a) | 11346 |  | 101887 |
|  TJX Cos., Inc. (The) | 29970 |  | 2160837 |
|  Tractor Supply Co. | 2976 |  | 654036 |
|  TravelCenters of America, Inc.\* | 2232 |  | 141911 |
|  Ulta Beauty, Inc.\* | 1302 |  | 546020 |
|  Urban Outfitters, Inc.\* (a) | 10360 |  | 247190 |
|  Victoria's Secret & Co.\* (a) | 16650 |  | 626040 |
|  Warby Parker, Inc., Class A\* (a) | 1674 |  | 26868 |
|  Williams-Sonoma, Inc.(a) | 2418 |  | 299421 |
|  Zumiez, Inc.\* (a) | 5952 |  | 133503 |
|  |  |  | **34460304** |
| **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** |
|  Apple, Inc. | 400525 |  | 61416504 |
|  Corsair Gaming, Inc.\* (a) | 8184 |  | 112939 |
|  Dell Technologies, Inc., Class C | 8928 |  | 342835 |
|  Hewlett Packard Enterprise Co.(a) | 44453 |  | 634344 |
|  HP, Inc. | 32843 |  | 907124 |
|  NetApp, Inc. | 6696 |  | 463832 |
|  Pure Storage, Inc., Class A\* | 9814 |  | 302860 |
|  Seagate Technology Holdings plc | 7440 |  | 369470 |
|  Super Micro Computer, Inc.\* | 11160 |  | 776625 |
|  Western Digital Corp.\* | 10416 |  | 357998 |
|  Xerox Holdings Corp.(a) | 20905 |  | 305840 |
|  |  |  | **65990371** |
| **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** |
|  Capri Holdings Ltd.\* | 4650 |  | 212412 |
|  Carter's, Inc.(a) | 9486 |  | 643815 |
|  Columbia Sportswear Co.(a) | 2046 |  | 152427 |
|  Crocs, Inc.\* (a) | 14136 |  | 1000122 |
|  Deckers Outdoor Corp.\* (a) | 930 |  | 325435 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** |
|  Fossil Group, Inc.\* | 12648 | $| 53754 |
|  G-III Apparel Group Ltd.\* (a) | 5022 |  | 97929 |
|  Hanesbrands, Inc.(a) | 79792 |  | 544181 |
|  Kontoor Brands, Inc.(a) | 10230 |  | 365211 |
|  Levi Strauss & Co., Class A(a) | 5208 |  | 77912 |
|  Lululemon Athletica, Inc.\* | 2976 |  | 979223 |
|  Movado Group, Inc.(a) | 1860 |  | 61510 |
|  NIKE, Inc., Class B | 33852 |  | 3137403 |
|  Oxford Industries, Inc.(a) | 1116 |  | 113531 |
|  PVH Corp. | 14880 |  | 763642 |
|  Ralph Lauren Corp.(a) | 10230 |  | 948219 |
|  Skechers USA, Inc., Class A\* | 6510 |  | 224139 |
|  Steven Madden Ltd. | 2046 |  | 61114 |
|  Tapestry, Inc.(a) | 10360 |  | 328205 |
|  Under Armour, Inc., Class A\* (a) | 11904 |  | 88685 |
|  Under Armour, Inc., Class C\* | 10044 |  | 65889 |
|  VF Corp. | 9858 |  | 278488 |
|  Wolverine World Wide, Inc.(a) | 19716 |  | 337735 |
|  |  |  | **10860981** |
| **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** |
|  Axos Financial, Inc.\* | 12276 |  | 478273 |
|  Essent Group Ltd.(a) | 24366 |  | 964406 |
|  Federal Agricultural Mortgage Corp., Class C | 2418 |  | 278554 |
|  Merchants Bancorp | 3348 |  | 80185 |
|  MGIC Investment Corp. | 63640 |  | 868686 |
|  Mr Cooper Group, Inc.\* | 17760 |  | 701342 |
|  New York Community Bancorp, Inc.(a) | 103785 |  | 966238 |
|  NMI Holdings, Inc., Class A\* | 20460 |  | 448688 |
|  Northfield Bancorp, Inc.(a) | 4810 |  | 77152 |
|  PennyMac Financial Services, Inc.(a) | 8325 |  | 443889 |
|  Provident Financial Services, Inc.(a) | 14880 |  | 333610 |
|  Radian Group, Inc. | 40163 |  | 838202 |
|  Rocket Cos., Inc., Class A(a) | 29946 |  | 206627 |
|  TFS Financial Corp.(a) | 7440 |  | 104532 |
|  TrustCo Bank Corp. NY | 3534 |  | 131889 |
|  UWM Holdings Corp.(a) | 27156 |  | 89072 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 183

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** |
|  Walker & Dunlop, Inc.(a) | 2046 | $| 184058 |
|  WSFS Financial Corp. | 12950 |  | 602952 |
|  |  |  | **7798355** |
| **Tobacco – 0.6%** |  |  |  |
|  Altria Group, Inc. | 60077 |  | 2779763 |
|  Philip Morris International, Inc. | 51149 |  | 4698036 |
|  Turning Point Brands, Inc. | 1488 |  | 35057 |
|  Universal Corp.(a) | 7030 |  | 355788 |
|  Vector Group Ltd.(a) | 29202 |  | 310125 |
|  |  |  | **8178769** |
| **Trading Companies & Distributors – 0.8%** | **Trading Companies & Distributors – 0.8%** | **Trading Companies & Distributors – 0.8%** | **Trading Companies & Distributors – 0.8%** |
|  Air Lease Corp. | 21275 |  | 750795 |
|  Applied Industrial Technologies, Inc. | 2604 |  | 323885 |
|  Beacon Roofing Supply, Inc.\* (a) | 12807 |  | 721674 |
|  BlueLinx Holdings, Inc.\* (a) | 2046 |  | 144161 |
|  Boise Cascade Co.(a) | 8928 |  | 596122 |
|  Core & Main, Inc., Class A\* (a) | 370 |  | 8725 |
|  Fastenal Co.(a) | 14136 |  | 683193 |
|  GATX Corp.(a) | 2604 |  | 272665 |
|  GMS, Inc.\* (a) | 11346 |  | 535531 |
|  H&E Equipment Services, Inc.(a) | 3534 |  | 133444 |
|  Herc Holdings, Inc.(a) | 5394 |  | 634388 |
|  McGrath RentCorp | 2035 |  | 191392 |
|  MRC Global, Inc.\* | 6696 |  | 67161 |
|  MSC Industrial Direct Co., Inc., Class A | 3348 |  | 277817 |
|  NOW, Inc.\* | 12213 |  | 155471 |
|  Rush Enterprises, Inc., Class A | 8140 |  | 406105 |
|  SiteOne Landscape Supply, Inc.\* (a) | 2418 |  | 280174 |
|  Titan Machinery, Inc.\* | 2232 |  | 76736 |
|  Triton International Ltd.(a) | 15269 |  | 926676 |
|  United Rentals, Inc.\* | 2418 |  | 763387 |
|  Univar Solutions, Inc.\* | 38129 |  | 971527 |
|  Veritiv Corp.\* (a) | 1295 |  | 150557 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** |
|  Watsco, Inc.(a) | 744 | $| 201594 |
|  WESCO International, Inc.\* | 10602 |  | 1460637 |
|  WW Grainger, Inc.(a) | 1116 |  | 652135 |
|  |  |  | **11385952** |
| **Water Utilities – 0.1%** |  |  |  |
|  American States Water Co.(a) | 2604 |  | 235558 |
|  American Water Works Co., Inc.(a) | 4650 |  | 675831 |
|  California Water Service Group | 3720 |  | 230863 |
|  Essential Utilities, Inc.(a) | 4810 |  | 212698 |
|  Middlesex Water Co.(a) | 558 |  | 49924 |
|  SJW Group(a) | 558 |  | 39440 |
|  York Water Co. (The) | 2220 |  | 96703 |
|  |  |  | **1541017** |
| **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** |
|  Gogo, Inc.\* (a) | 8742 |  | 124311 |
|  Shenandoah Telecommunications Co.(a) | 2232 |  | 50577 |
|  Telephone and Data Systems, Inc.(a) | 1110 |  | 18870 |
|  T-Mobile US, Inc.\* | 15540 |  | 2355243 |
|  |  |  | **2549001** |
| **Total Common Stocks <br>(Cost $932,350,914)** | **Total Common Stocks <br>(Cost $932,350,914)** |  | **1385090679** |
|  | Number of<br>Warrants |  |  |
| **WARRANTS – 0.0%(d)** | **WARRANTS – 0.0%(d)** | **WARRANTS – 0.0%(d)** | **WARRANTS – 0.0%(d)** |
| **Oil, Gas & Consumable Fuels – 0.0%(d)** | **Oil, Gas & Consumable Fuels – 0.0%(d)** | **Oil, Gas & Consumable Fuels – 0.0%(d)** | **Oil, Gas & Consumable Fuels – 0.0%(d)** |
|  Occidental Petroleum Corp., expiring 8/3/2027, price 22.00 USD\*<br>(Cost $21,117) | 4266 |  | 215860 |

---

*See Accompanying Notes to the Financial Statements.* 

184 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Number of<br>Rights | Value |
| **RIGHTS – 0.0%(d)** | **RIGHTS – 0.0%(d)** | **RIGHTS – 0.0%(d)** |
| **Biotechnology – 0.0%(d)** | **Biotechnology – 0.0%(d)** | **Biotechnology – 0.0%(d)** |
|  Achillion Pharmaceuticals, Inc., CVR\* ‡ (d) | 44344 | $25719 |
| **Pharmaceuticals – 0.0%(d)** | **Pharmaceuticals – 0.0%(d)** | **Pharmaceuticals – 0.0%(d)** |
|  Zogenix, Inc., CVR\* ‡ | 4675 | 4675 |
| **Total Rights <br>(Cost $0)** | **Total Rights <br>(Cost $0)** | **30394** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(e) – 14.6%** | **SECURITIES LENDING REINVESTMENTS(e) – 14.6%** | **SECURITIES LENDING REINVESTMENTS(e) – 14.6%** |
| **CERTIFICATES OF DEPOSIT – 2.1%** | **CERTIFICATES OF DEPOSIT – 2.1%** | **CERTIFICATES OF DEPOSIT – 2.1%** |
|  Barclays Bank plc, New York | Barclays Bank plc, New York |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.52%), 3.56%, 4/5/2023(f) | $5000000 | 4995490 |
|  Credit Agricole CIB, New York | Credit Agricole CIB, New York |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.68%), 3.73%, 4/25/2023(f) | 6000000 | 5999400 |
|  MUFG Bank Ltd., New York Branch | MUFG Bank Ltd., New York Branch |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.59%), 3.63%, 2/10/2023(f) | 5000000 | 5000115 |
|  Royal Bank of Canada | Royal Bank of Canada |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (US Federal Funds Effective Rate (continuous series) + 0.37%), 3.45%, 12/2/2022(f) | 7000000 | 7000000 |
|  The Sumitomo Bank Ltd., New York | The Sumitomo Bank Ltd., New York |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.75%), 3.80%, 4/21/2023(f) | 6000000 | 6000042 |
| **Total Certificates of Deposit <br>(Cost $29,000,000)** | **Total Certificates of Deposit <br>(Cost $29,000,000)** | **28995047** |
| **COMMERCIAL PAPER – 0.4%** | **COMMERCIAL PAPER – 0.4%** | **COMMERCIAL PAPER – 0.4%** |
|  Macquarie Bank Ltd. | Macquarie Bank Ltd. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.31%), 3.35%, 11/3/2022(f) (Cost $6,000,000) | 6000000 | 6000000 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – 12.1%** | **REPURCHASE AGREEMENTS – 12.1%** | **REPURCHASE AGREEMENTS – 12.1%** |
|  BofA Securities, Inc., 3.52%, dated 10/31/2022, due 1/31/2023, repurchase price $6,053,973, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 4.13%, maturing 11/15/2023 – 2/15/2051; total market value $6,084,291 | $6000000 | $6000000 |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $71,827,753, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $72,331,897 | 71821768 | 71821768 |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $71,042,383, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $71,972,852 | 71000000 | 71000000 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 185

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** |
|  Societe Generale, New York Branch, 3.05%, dated 10/31/2022, due 11/7/2022, repurchase price $20,011,861, collateralized by various U.S. Treasury Securities, ranging from 0.63% – 2.88%, maturing 7/31/2026 – 7/31/2028; total market value $20,231,920 | $| 20000000 | $20000000 |
| **Total Repurchase Agreements <br>(Cost $168,821,768)** | **Total Repurchase Agreements <br>(Cost $168,821,768)** | **Total Repurchase Agreements <br>(Cost $168,821,768)** | **168821768** |
| **Total Securities Lending Reinvestments <br>(Cost $203,821,768)** | **Total Securities Lending Reinvestments <br>(Cost $203,821,768)** | **Total Securities Lending Reinvestments <br>(Cost $203,821,768)** | **203816815** |
| **Total Investments – 113.7% <br>(Cost $1,136,193,799)** | **Total Investments – 113.7% <br>(Cost $1,136,193,799)** | **Total Investments – 113.7% <br>(Cost $1,136,193,799)** | **1589153748** |
|  Liabilities in excess of other assets – (13.7%) | Liabilities in excess of other assets – (13.7%) | Liabilities in excess of other assets – (13.7%) | (191746246) |
| **Net Assets – 100.0%** | **Net Assets – 100.0%** | **Net Assets – 100.0%** | $**1397407502** |

---

*\** *Non-income producing security.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $275,892,234, collateralized in the form of cash with a value of $203,821,768 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $78,031,431 of collateral in the form of U.S. Government* 

 *Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 15, 2022 – May 15, 2052 and $1,954,021 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 22, 2023 – June 30, 2120; a total value of $283,807,220.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Investment in affiliated company. Northern Trust Investments, Inc., the Investment Adviser of the Fund, is a subsidiary of Northern Trust Corporation.* 

*<sup>(d)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(e)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $203,816,815.* 

*<sup>(f)</sup>* *Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*CVR – Contingent Value Rights* 

*SOFR – Secured Overnight Financing Rate* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $511863428 |
|  Aggregate gross unrealized depreciation | (59056132) |
|  Net unrealized appreciation | $452807296 |
|  Federal income tax cost | $1136631882 |

---

*Investment in a company which was affiliated for the period ended October 31, 2022, was as follows:* 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Security | Value<br>October 31,<br>2021 | Purchases<br>at Cost | Sales<br>Proceeds | Shares<br>October 31,<br>2022 | Value<br>October 31,<br>2022 | Change in<br>Unrealized<br>Appreciation<br>(Depreciation) | Dividend<br>Income | Realized<br>Gain |
|  Northern Trust Corp. | $902375 | $79744 | $167649 | 6696 | $564807 | $(287907) | $18788 | $38244 |

---

*See Accompanying Notes to the Financial Statements.* 

186 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (cont.)

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**Futures Contracts** 

*FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |  |
|  Russell 2000 E-Mini Index | 28 | 12/16/2022 | USD | $2594200 | $90049 |
|  S&P 500 E-Mini Index | 37 | 12/16/2022 | USD | 7183550 | 111409 |
|  S&P Midcap 400 E-Mini Index | 8 | 12/16/2022 | USD | 1951680 | 83972 |
|  |  |  |  |  | $285430 |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD — US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.1 |
|  Warrants | 0.0 |
|  Rights | 0.0 |
|  Securities Lending Reinvestments | 14.6 |
|  Others<sup>(1)</sup> | (13.7 |
|  | 100.0 |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 187

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 97.5%** | **COMMON STOCKS – 97.5%** | **COMMON STOCKS – 97.5%** |
| **Aerospace & Defense – 1.1%** | **Aerospace & Defense – 1.1%** | **Aerospace & Defense – 1.1%** |
|  Airbus SE | 8733 | $945814 |
|  Austal Ltd.(a) | 66789 | 106343 |
|  Babcock International Group plc\* | 168633 | 535093 |
|  BAE Systems plc | 51168 | 479782 |
|  Bombardier, Inc., Class B\* (a) | 26445 | 775679 |
|  CAE, Inc.\* (a) | 4836 | 92178 |
|  Chemring Group plc | 8536 | 29680 |
|  Dassault Aviation SA | 550 | 81756 |
|  Elbit Systems Ltd. | 412 | 83723 |
|  Hensoldt AG | 3276 | 77060 |
|  INVISIO AB(a) | 2552 | 37874 |
|  Kongsberg Gruppen ASA | 1540 | 55190 |
|  Leonardo SpA | 12056 | 96897 |
|  LISI | 880 | 17378 |
|  Montana Aerospace AG\* (b) | 1496 | 17161 |
|  MTU Aero Engines AG | 738 | 132204 |
|  QinetiQ Group plc | 39688 | 164227 |
|  Rheinmetall AG | 779 | 126653 |
|  Rolls-Royce Holdings plc\* | 137309 | 123548 |
|  Saab AB, Class B | 1596 | 56356 |
|  Safran SA | 5412 | 602934 |
|  Singapore Technologies Engineering Ltd. | 17900 | 41743 |
|  Thales SA | 1599 | 203315 |
|  |  | **4882588** |
| **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** |
|  bpost SA(a) | 31119 | 153782 |
|  Cargojet, Inc. | 672 | 65424 |
|  Cia de Distribucion Integral Logista Holdings SA | 21976 | 454817 |
|  Deutsche Post AG (Registered) | 19926 | 707207 |
|  DSV A/S | 2665 | 360874 |
|  Freightways Ltd.(a) | 6248 | 37568 |
|  Hitachi Transport System Ltd.(a) | 1300 | 77754 |
|  ID Logistics Group\* | 81 | 21775 |
|  International Distributions Services plc | 14455 | 33668 |
|  Kerry Logistics Network Ltd. | 18500 | 29365 |
|  Mainfreight Ltd.(a) | 1892 | 83580 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** |
|  Nippon Express Holdings, Inc. | 1600 | $| 80412 |
|  Oesterreichische Post AG(a) | 588 |  | 16766 |
|  PostNL NV(a) | 158515 |  | 248633 |
|  SBS Holdings, Inc.(a) | 8200 |  | 159989 |
|  SG Holdings Co. Ltd. | 8400 |  | 111446 |
|  Singapore Post Ltd. | 101200 |  | 38618 |
|  Yamato Holdings Co. Ltd. | 6200 |  | 91935 |
|  |  |  | **2773613** |
| **Airlines – 0.3%** | **Airlines – 0.3%** | **Airlines – 0.3%** | **Airlines – 0.3%** |
|  Air Canada\* | 5192 |  | 74642 |
|  Air France-KLM\* | 375437 |  | 494071 |
|  Air New Zealand Ltd.\* (a) | 11968 |  | 5423 |
|  ANA Holdings, Inc.\* | 2400 |  | 46681 |
|  Deutsche Lufthansa AG (Registered)\* | 11748 |  | 80616 |
|  easyJet plc\* | 14080 |  | 56479 |
|  Exchange Income Corp.(a) | 2952 |  | 98468 |
|  Finnair OYJ\* (a) | 82324 |  | 34905 |
|  Japan Airlines Co. Ltd.\* | 2800 |  | 52276 |
|  JET2 plc\* | 2813 |  | 27523 |
|  Qantas Airways Ltd.\* | 22968 |  | 85771 |
|  Singapore Airlines Ltd.\* | 16799 |  | 62443 |
|  Wizz Air Holdings plc\* (a) (b) | 728 |  | 14375 |
|  |  |  | **1133673** |
| **Auto Components – 1.6%** | **Auto Components – 1.6%** | **Auto Components – 1.6%** | **Auto Components – 1.6%** |
|  Aisin Corp. | 4300 |  | 110368 |
|  ARB Corp. Ltd.(a) | 1007 |  | 18680 |
|  Brembo SpA | 3647 |  | 38136 |
|  Bridgestone Corp. | 12000 |  | 432899 |
|  Burelle SA | 132 |  | 55577 |
|  CIE Automotive SA(a) | 15539 |  | 395314 |
|  Cie Generale des Etablissements Michelin SCA | 16072 |  | 409986 |
|  Cie Plastic Omnium SA | 17835 |  | 250130 |
|  Continental AG | 1845 |  | 95698 |
|  Denso Corp. | 8200 |  | 407697 |
|  Dometic Group AB(a) (c) | 5962 |  | 34130 |
|  Exedy Corp. | 12300 |  | 144239 |
|  Faurecia SE\* | 5146 |  | 76883 |
|  Gestamp Automocion SA(b) | 46043 |  | 161822 |

---

*See Accompanying Notes to the Financial Statements.* 

188 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** |
|  GUD Holdings Ltd.(a) | 6543 | $| 33639 |
|  Hella GmbH & Co. KGaA | 660 |  | 51565 |
|  Johnson Electric Holdings Ltd.(a) | 144778 |  | 149207 |
|  JTEKT Corp. | 6700 |  | 47331 |
|  Koito Manufacturing Co. Ltd. | 5000 |  | 71114 |
|  KYB Corp. | 8200 |  | 179574 |
|  Linamar Corp. | 1584 |  | 67712 |
|  Magna International, Inc. | 5781 |  | 321758 |
|  Musashi Seimitsu Industry Co. Ltd.(a) | 16400 |  | 189449 |
|  NGK Spark Plug Co. Ltd. | 2700 |  | 49228 |
|  NHK Spring Co. Ltd. | 68500 |  | 379749 |
|  Nifco, Inc. | 2400 |  | 55788 |
|  NOK Corp. | 37100 |  | 303519 |
|  Nokian Renkaat OYJ | 2552 |  | 28779 |
|  Pirelli & C SpA(b) | 9548 |  | 36030 |
|  Schaeffler AG (Preference) | 55350 |  | 284740 |
|  Shoei Co. Ltd. | 2200 |  | 81259 |
|  Stanley Electric Co. Ltd.(a) | 3800 |  | 64631 |
|  Sumitomo Electric Industries Ltd.(a) | 16400 |  | 171464 |
|  Sumitomo Rubber Industries Ltd. | 4900 |  | 42066 |
|  TI Fluid Systems plc(b) | 132389 |  | 211567 |
|  Tokai Rika Co. Ltd. | 18800 |  | 196304 |
|  Toyo Tire Corp.(a) | 41400 |  | 485486 |
|  Toyoda Gosei Co. Ltd. | 2000 |  | 31971 |
|  Toyota Boshoku Corp.(a) | 2700 |  | 34405 |
|  TS Tech Co. Ltd.(a) | 33400 |  | 349426 |
|  Valeo | 4746 |  | 78288 |
|  Vitesco Technologies Group AG\* | 6355 |  | 340428 |
|  Yokohama Rubber Co. Ltd. (The) | 3600 |  | 56385 |
|  |  |  | **7024421** |
| **Automobiles – 2.1%** | **Automobiles – 2.1%** | **Automobiles – 2.1%** | **Automobiles – 2.1%** |
|  Aston Martin Lagonda Global Holdings plc\* (a) (b) | 578 |  | 703 |
|  Bayerische Motoren Werke AG | 6847 |  | 538130 |
|  Bayerische Motoren Werke AG (Preference) | 1012 |  | 74716 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** |
|  Ferrari NV | 1886 | $| 371874 |
|  Honda Motor Co. Ltd. | 36900 |  | 837378 |
|  Isuzu Motors Ltd. | 12300 |  | 144321 |
|  Mazda Motor Corp. | 8900 |  | 60058 |
|  Mercedes-Benz Group AG | 15744 |  | 911850 |
|  Mitsubishi Motors Corp.\* | 13500 |  | 45413 |
|  Nissan Motor Co. Ltd.(a) | 53700 |  | 171395 |
|  Piaggio & C SpA | 35322 |  | 90767 |
|  PIERER Mobility AG(a) | 440 |  | 25501 |
|  Porsche Automobil Holding SE (Preference) | 3034 |  | 169724 |
|  Renault SA\* | 3265 |  | 100584 |
|  Stellantis NV | 48568 |  | 655331 |
|  Subaru Corp. | 12700 |  | 197846 |
|  Suzuki Motor Corp. | 11500 |  | 388401 |
|  Toyota Motor Corp. | 262400 |  | 3635838 |
|  Trigano SA | 2378 |  | 243491 |
|  Volkswagen AG (Preference) | 4018 |  | 513634 |
|  Volvo Car AB, Class B\* | 10332 |  | 43841 |
|  Yamaha Motor Co. Ltd.(a) | 8200 |  | 169368 |
|  |  |  | **9390164** |
| **Banks – 10.4%** | **Banks – 10.4%** | **Banks – 10.4%** | **Banks – 10.4%** |
|  77 Bank Ltd. (The) | 24600 |  | 298077 |
|  ABN AMRO Bank NV, CVA(b) | 9052 |  | 89072 |
|  AIB Group plc | 18788 |  | 54408 |
|  Aktia Bank OYJ(a) | 13612 |  | 135341 |
|  Alandsbanken Abp, Class B(a) | 1512 |  | 47820 |
|  Alior Bank SA\* | 29643 |  | 182654 |
|  AMCO - Asset Management Co. SpA\* (a) | 239 |  | 925 |
|  Aozora Bank Ltd. | 2900 |  | 49889 |
|  Australia & New Zealand Banking Group Ltd.(a) | 60395 |  | 987117 |
|  Awa Bank Ltd. (The)(a) | 16400 |  | 206221 |
|  Banca Popolare di Sondrio SpA | 139031 |  | 498803 |
|  Banco Bilbao Vizcaya Argentaria SA(a) | 144115 |  | 741949 |
|  Banco BPM SpA | 32208 |  | 97440 |
|  Banco Comercial Portugues SA, Class R | 189546 |  | 27052 |
|  Banco de Sabadell SA | 125993 |  | 99072 |
|  Banco Santander SA(a) | 365802 |  | 947959 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 189

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Bank Hapoalim BM | 23493 | $227621 |
|  Bank Leumi Le-Israel BM | 31037 | 297627 |
|  Bank Millennium SA\* | 25740 | 23521 |
|  Bank of Ireland Group plc | 17794 | 128313 |
|  Bank of Kyoto Ltd. (The) | 1600 | 57698 |
|  Bank of Montreal(a) | 13858 | 1274910 |
|  Bank of Nova Scotia (The) | 24805 | 1197470 |
|  Bank of Queensland Ltd.(a) | 13492 | 63498 |
|  Bank Polska Kasa Opieki SA | 4004 | 65825 |
|  Bankinter SA(a) | 9240 | 55853 |
|  Banque Cantonale de Geneve | 697 | 125366 |
|  Banque Cantonale Vaudoise (Registered) | 701 | 62412 |
|  Barclays plc | 335913 | 571467 |
|  BAWAG Group AG\* (b) | 2105 | 101777 |
|  Bendigo & Adelaide Bank Ltd.(a) | 9421 | 54279 |
|  Berner Kantonalbank AG (Registered) | 126 | 27762 |
|  BNP Paribas SA | 24559 | 1152841 |
|  BPER Banca | 40348 | 74671 |
|  CaixaBank SA | 96227 | 318890 |
|  Canadian Imperial Bank of Commerce | 18327 | 831268 |
|  Canadian Western Bank(a) | 28249 | 490819 |
|  Chiba Bank Ltd. (The) | 17400 | 95174 |
|  Chugin Financial Group, Inc. | 61500 | 370734 |
|  Close Brothers Group plc | 47232 | 534017 |
|  Commerzbank AG\* | 20787 | 166331 |
|  Commonwealth Bank of Australia | 24641 | 1649410 |
|  Concordia Financial Group Ltd. | 32321 | 98506 |
|  Credit Agricole SA | 28126 | 255355 |
|  Credito Emiliano SpA | 28085 | 166547 |
|  Dah Sing Banking Group Ltd.(a) | 149440 | 89095 |
|  Dah Sing Financial Holdings Ltd. | 65600 | 129865 |
|  Daishi Hokuetsu Financial Group, Inc. | 16400 | 289636 |
|  Danske Bank A/S | 13079 | 211138 |
|  DBS Group Holdings Ltd. | 37856 | 914900 |
|  DNB Bank ASA | 17056 | 301851 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Erste Group Bank AG | 7380 | $182059 |
|  FIBI Holdings Ltd. | 1100 | 52101 |
|  FinecoBank Banca Fineco SpA | 11029 | 148683 |
|  First International Bank of Israel Ltd. (The) | 1144 | 49635 |
|  Fukuoka Financial Group, Inc. | 2800 | 47547 |
|  Graubuendner Kantonalbank | 7 | 11786 |
|  Gunma Bank Ltd. (The) | 139400 | 379837 |
|  Hachijuni Bank Ltd. (The) | 159000 | 507054 |
|  Hang Seng Bank Ltd. | 12300 | 173143 |
|  Heartland Group Holdings Ltd. | 50556 | 50224 |
|  Hirogin Holdings, Inc. | 95300 | 393036 |
|  Hokuhoku Financial Group, Inc. | 40900 | 245727 |
|  HSBC Holdings plc | 424145 | 2184342 |
|  Hyakugo Bank Ltd. (The) | 90200 | 199656 |
|  ING Bank Slaski SA | 748 | 26086 |
|  ING Groep NV | 82738 | 813979 |
|  Intesa Sanpaolo SpA | 361702 | 689595 |
|  Israel Discount Bank Ltd., Class A | 29866 | 170736 |
|  Iyogin Holdings, Inc. | 102500 | 480657 |
|  Jyske Bank A/S (Registered)\* | 1292 | 69775 |
|  KBC Ancora | 352 | 12517 |
|  KBC Group NV | 6519 | 326663 |
|  Kiyo Bank Ltd. (The) | 22700 | 218852 |
|  Kyushu Financial Group, Inc.(a) | 134400 | 339990 |
|  Laurentian Bank of Canada(a) | 14801 | 329864 |
|  Liechtensteinische Landesbank AG | 3526 | 192728 |
|  Lloyds Banking Group plc | 1509538 | 730310 |
|  Luzerner Kantonalbank AG (Registered) | 16 | 6603 |
|  Mebuki Financial Group, Inc. | 28010 | 54462 |
|  Mediobanca Banca di Credito Finanziario SpA | 13776 | 124881 |
|  Mitsubishi UFJ Financial Group, Inc. | 262400 | 1234896 |
|  Mizrahi Tefahot Bank Ltd. | 3047 | 115750 |
|  Mizuho Financial Group, Inc. | 53329 | 576219 |
|  National Australia Bank Ltd. | 45674 | 946866 |
|  National Bank of Canada | 6970 | 473984 |
|  NatWest Group plc | 96664 | 261319 |

---

*See Accompanying Notes to the Financial Statements.* 

190 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Nishi-Nippon Financial Holdings, Inc. | 53300 | $271816 |
|  Nordea Bank Abp | 66502 | 635023 |
|  North Pacific Bank Ltd.(a) | 94300 | 149728 |
|  Ogaki Kyoritsu Bank Ltd. (The) | 13500 | 159401 |
|  Oversea-Chinese Banking Corp. Ltd. | 86170 | 738635 |
|  Pareto Bank ASA | 16280 | 73674 |
|  Powszechna Kasa Oszczednosci Bank Polski SA | 16716 | 91334 |
|  Raiffeisen Bank International AG | 4224 | 58739 |
|  Resona Holdings, Inc. | 56300 | 212003 |
|  Ringkjoebing Landbobank A/S | 704 | 76638 |
|  Royal Bank of Canada(a) | 29438 | 2720325 |
|  San-In Godo Bank Ltd. (The)(a) | 53300 | 253886 |
|  Santander Bank Polska SA | 836 | 44539 |
|  Shiga Bank Ltd. (The) | 17400 | 294653 |
|  Shinsei Bank Ltd. | 2600 | 38658 |
|  Shizuoka Financial Group, Inc. | 17200 | 108545 |
|  Skandinaviska Enskilda Banken AB, Class A | 39811 | 419710 |
|  Skandinaviska Enskilda Banken AB, Class C | 684 | 7799 |
|  Societe Generale SA | 16359 | 375512 |
|  Spar Nord Bank A/S | 28823 | 348973 |
|  SpareBank 1 Nord Norge | 33907 | 281448 |
|  Sparebank 1 Oestlandet | 1329 | 14368 |
|  SpareBank 1 SMN | 3103 | 33487 |
|  SpareBank 1 SR-Bank ASA | 4796 | 48805 |
|  Sparebanken Vest | 31529 | 279905 |
|  St Galler Kantonalbank AG (Registered) | 110 | 51826 |
|  Standard Chartered plc | 54694 | 327580 |
|  Sumitomo Mitsui Financial Group, Inc. | 27900 | 783306 |
|  Sumitomo Mitsui Trust Holdings, Inc. | 8200 | 235957 |
|  Suruga Bank Ltd. | 70500 | 186881 |
|  Svenska Handelsbanken AB, Class A | 28700 | 266600 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Svenska Handelsbanken AB, Class B | 908 | $| 9926 |
|  Swedbank AB, Class A | 17220 |  | 256575 |
|  Sydbank A/S | 20213 |  | 616113 |
|  TBC Bank Group plc | 14596 |  | 316608 |
|  Toronto-Dominion Bank (The) | 38177 |  | 2440272 |
|  Unicaja Banco SA | 549933 |  | 487000 |
|  UniCredit SpA | 46371 |  | 575085 |
|  United Overseas Bank Ltd. | 30926 |  | 606675 |
|  Valiant Holding AG (Registered) | 5289 |  | 518462 |
|  Virgin Money UK plc | 41844 |  | 65569 |
|  Walliser Kantonalbank (Registered) | 485 |  | 52098 |
|  Westpac Banking Corp. | 51783 |  | 798346 |
|  Yamaguchi Financial Group, Inc. | 77900 |  | 409848 |
|  Zuger Kantonalbank AG | 10 |  | 73745 |
|  |  |  | **46577884** |
| **Beverages – 1.1%** | **Beverages – 1.1%** | **Beverages – 1.1%** | **Beverages – 1.1%** |
|  Anheuser-Busch InBev SA/NV | 13817 |  | 690995 |
|  Asahi Group Holdings Ltd.(a) | 6900 |  | 193303 |
|  Britvic plc | 3520 |  | 29484 |
|  Budweiser Brewing Co. APAC Ltd.(b) | 14400 |  | 30305 |
|  C&C Group plc\* (a) | 23522 |  | 44279 |
|  Carlsberg A/S, Class B | 1599 |  | 188503 |
|  Coca-Cola Bottlers Japan Holdings, Inc. | 3354 |  | 30328 |
|  Coca-Cola Europacific Partners plc(a) | 3250 |  | 152912 |
|  Coca-Cola HBC AG | 4000 |  | 87618 |
|  Davide Campari-Milano NV | 10094 |  | 90725 |
|  Diageo plc | 33620 |  | 1392728 |
|  Fevertree Drinks plc | 2199 |  | 24192 |
|  Heineken Holding NV | 1461 |  | 99779 |
|  Heineken NV | 3403 |  | 284540 |
|  Ito En Ltd. | 800 |  | 28257 |
|  Kirin Holdings Co. Ltd. | 16438 |  | 242143 |
|  Olvi OYJ, Class A | 1452 |  | 44846 |
|  Pernod Ricard SA | 2829 |  | 496857 |
|  Primo Water Corp. | 8815 |  | 128343 |
|  Remy Cointreau SA | 398 |  | 61011 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 191

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** |
|  Royal Unibrew A/S | 836 | $| 47757 |
|  Sapporo Holdings Ltd.(a) | 6000 |  | 132405 |
|  Suntory Beverage & Food Ltd. | 1800 |  | 60309 |
|  Takara Holdings, Inc. | 12300 |  | 85732 |
|  Treasury Wine Estates Ltd. | 8668 |  | 71779 |
|  |  |  | **4739130** |
| **Biotechnology – 0.6%** | **Biotechnology – 0.6%** | **Biotechnology – 0.6%** | **Biotechnology – 0.6%** |
|  Abcam plc\* | 4545 |  | 70330 |
|  Argenx SE\* | 861 |  | 335963 |
|  Bavarian Nordic A/S\* (a) | 3823 |  | 121807 |
|  BioGaia AB, Class B | 5670 |  | 44896 |
|  Biotest AG (Preference) | 924 |  | 31963 |
|  Clinuvel Pharmaceuticals Ltd.(a) | 1368 |  | 17110 |
|  CSL Ltd. | 6929 |  | 1242737 |
|  Galapagos NV\* | 924 |  | 42182 |
|  Genmab A/S\* | 943 |  | 363552 |
|  Genus plc | 2520 |  | 74102 |
|  Grifols SA\* (a) | 3564 |  | 30314 |
|  Grifols SA (Preference), Class B\* | 5680 |  | 35423 |
|  Idorsia Ltd.\* (a) | 3564 |  | 55201 |
|  Imugene Ltd.\* (a) | 171556 |  | 19198 |
|  Mesoblast Ltd.\* | 44748 |  | 26468 |
|  Pacific Edge Ltd.\* (a) | 60412 |  | 15091 |
|  PeptiDream, Inc.\* (a) | 2500 |  | 27467 |
|  Pharma Mar SA | 414 |  | 24804 |
|  Takara Bio, Inc. | 400 |  | 4691 |
|  Telix Pharmaceuticals Ltd.\* (a) | 14168 |  | 62784 |
|  Valneva SE\* | 4620 |  | 31260 |
|  Vitrolife AB(a) | 880 |  | 14223 |
|  |  |  | **2691566** |
| **Building Products – 1.0%** | **Building Products – 1.0%** | **Building Products – 1.0%** | **Building Products – 1.0%** |
|  AGC, Inc.(a) | 5000 |  | 156928 |
|  Arbonia AG(a) | 2156 |  | 26283 |
|  Assa Abloy AB, Class B | 14842 |  | 299514 |
|  Belimo Holding AG (Registered) | 132 |  | 53816 |
|  Bunka Shutter Co. Ltd.(a) | 22200 |  | 159665 |
|  Carel Industries SpA(b) | 840 |  | 18306 |
|  Central Glass Co. Ltd.(a) | 12500 |  | 295186 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** |
|  Cie de Saint-Gobain | 11152 | $| 456314 |
|  Daikin Industries Ltd. | 4200 |  | 632536 |
|  dormakaba Holding AG | 126 |  | 40038 |
|  Fletcher Building Ltd. | 17649 |  | 52701 |
|  Geberit AG (Registered) | 533 |  | 237167 |
|  Genuit Group plc | 15664 |  | 46079 |
|  Inrom Construction Industries Ltd.(a) | 8932 |  | 36621 |
|  Inwido AB | 4884 |  | 43844 |
|  James Halstead plc | 9372 |  | 20502 |
|  Kingspan Group plc | 2461 |  | 124292 |
|  Lindab International AB | 2244 |  | 23861 |
|  Lixil Corp. | 6000 |  | 90867 |
|  Munters Group AB(b) | 10384 |  | 80954 |
|  Nibe Industrier AB, Class B(a) | 23739 |  | 189260 |
|  Nichias Corp. | 21300 |  | 329026 |
|  Nichiha Corp.(a) | 12300 |  | 233198 |
|  Nitto Boseki Co. Ltd. | 1900 |  | 28238 |
|  Noritz Corp.(a) | 16400 |  | 168596 |
|  Reliance Worldwide Corp. Ltd.(a) | 13860 |  | 28449 |
|  ROCKWOOL A/S, Class A | 88 |  | 17360 |
|  ROCKWOOL A/S, Class B | 174 |  | 34650 |
|  Sanwa Holdings Corp. | 5400 |  | 46576 |
|  Schweiter Technologies AG | 56 |  | 37548 |
|  Sekisui Jushi Corp. | 13500 |  | 154768 |
|  Steico SE | 396 |  | 17417 |
|  Takara Standard Co. Ltd. | 2176 |  | 18695 |
|  Takasago Thermal Engineering Co. Ltd.(a) | 20500 |  | 249638 |
|  TOTO Ltd. | 3000 |  | 85781 |
|  Uponor OYJ | 2112 |  | 28055 |
|  Volution Group plc | 7524 |  | 26768 |
|  |  |  | **4589497** |
| **Capital Markets – 2.9%** | **Capital Markets – 2.9%** | **Capital Markets – 2.9%** | **Capital Markets – 2.9%** |
|  3i Group plc | 20992 |  | 280483 |
|  abrdn plc | 43554 |  | 79732 |
|  AJ Bell plc | 11352 |  | 42452 |
|  Allfunds Group plc | 4048 |  | 25545 |
|  Alpha FX Group plc | 1804 |  | 39464 |
|  Amundi SA(b) | 880 |  | 41557 |
|  Anima Holding SpA(b) | 68429 |  | 212093 |

---

*See Accompanying Notes to the Financial Statements.* 

192 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Ashmore Group plc | 22554 | $53597 |
|  ASX Ltd. | 2624 | 113595 |
|  Avanza Bank Holding AB(a) | 2704 | 53955 |
|  Azimut Holding SpA | 3740 | 60252 |
|  Banca Generali SpA | 1397 | 41781 |
|  Brederode SA\* | 80 | 7630 |
|  Brookfield Asset Management, Inc., Class A | 20828 | 823755 |
|  Bure Equity AB | 968 | 18693 |
|  Canaccord Genuity Group, Inc.(a) | 33087 | 169310 |
|  CI Financial Corp. | 5304 | 53038 |
|  CMC Markets plc(a) (b) | 45059 | 127362 |
|  Credit Suisse Group AG (Registered)(a) | 51619 | 213027 |
|  Daiwa Securities Group, Inc. | 36900 | 143990 |
|  Deutsche Bank AG (Registered) | 42558 | 406321 |
|  Deutsche Boerse AG | 2788 | 453696 |
|  EFG International AG\* | 28864 | 236507 |
|  EQT AB(a) | 4756 | 93653 |
|  Euronext NV(b) | 1394 | 88590 |
|  Fairfax India Holdings Corp.\* (a) (b) | 6468 | 60541 |
|  flatexDEGIRO AG\* | 4400 | 38521 |
|  Flow Traders(b) | 798 | 19213 |
|  Generation Capital Ltd.\* (a) | 314839 | 104216 |
|  Gimv NV | 6055 | 258828 |
|  GMO Financial Holdings, Inc.(a) | 8400 | 32270 |
|  Haitong International Securities Group Ltd.\* (a) | 923999 | 67094 |
|  Hargreaves Lansdown plc | 5061 | 44472 |
|  Hong Kong Exchanges & Clearing Ltd. | 17258 | 459489 |
|  HUB24 Ltd.(a) | 4532 | 73435 |
|  IG Group Holdings plc | 8448 | 77375 |
|  IGM Financial, Inc. | 2200 | 58820 |
|  Impax Asset Management Group plc | 4224 | 32584 |
|  Insignia Financial Ltd.(a) | 198809 | 400455 |
|  IntegraFin Holdings plc(b) | 5764 | 16724 |
|  Intermediate Capital Group plc | 5280 | 64560 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Investec plc | 16636 | $83990 |
|  IP Group plc | 310370 | 210833 |
|  JAFCO Group Co. Ltd. | 21400 | 328699 |
|  Japan Exchange Group, Inc. | 8200 | 107772 |
|  JTC plc(b) | 5016 | 40368 |
|  Julius Baer Group Ltd. | 4674 | 224044 |
|  Jupiter Fund Management plc | 190527 | 227699 |
|  Leonteq AG(a) | 616 | 24868 |
|  Liontrust Asset Management plc | 2508 | 24660 |
|  London Stock Exchange Group plc | 4715 | 410729 |
|  Macquarie Group Ltd. | 5576 | 604365 |
|  Magellan Financial Group Ltd.(a) | 2640 | 16763 |
|  Man Group plc | 32340 | 80688 |
|  Matsui Securities Co. Ltd. | 8400 | 44759 |
|  Molten Ventures plc\* | 50676 | 186707 |
|  Ninety One plc | 28555 | 66937 |
|  Nomura Holdings, Inc. | 53000 | 171799 |
|  Nordnet AB publ | 2420 | 30002 |
|  Okasan Securities Group, Inc.(a) | 52900 | 125991 |
|  Onex Corp. | 880 | 44237 |
|  Partners Group Holding AG | 369 | 331630 |
|  Pendal Group Ltd.(a) | 106313 | 333791 |
|  Perpetual Ltd.(a) | 3971 | 63228 |
|  Pinnacle Investment Management Group Ltd.(a) | 6468 | 33667 |
|  Platinum Asset Management Ltd.(a) | 37488 | 42909 |
|  Quilter plc(b) | 22680 | 25240 |
|  Rathbones Group plc | 2142 | 46216 |
|  Ratos AB, Class B(a) | 8448 | 31627 |
|  Rothschild & Co. | 1452 | 51520 |
|  SBI Holdings, Inc. | 4800 | 86806 |
|  Schroders plc | 12127 | 54691 |
|  Singapore Exchange Ltd. | 16400 | 97582 |
|  Sprott, Inc. | 1056 | 37803 |
|  St James's Place plc | 8118 | 99542 |
|  Swissquote Group Holding SA (Registered)(a) | 660 | 78217 |
|  Tamburi Investment Partners SpA | 10560 | 74311 |
|  Tikehau Capital SCA(a) | 1672 | 40652 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 193

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  TMX Group Ltd. | 836 | $| 80275 |
|  Tokai Tokyo Financial Holdings, Inc.(a) | 65600 |  | 150500 |
|  TP ICAP Group plc | 255061 |  | 540343 |
|  UBS Group AG (Registered) | 76588 |  | 1216071 |
|  UOB-Kay Hian Holdings Ltd. | 118900 |  | 111750 |
|  Van Lanschot Kempen NV, CVA | 10824 |  | 233749 |
|  Vontobel Holding AG (Registered) | 339 |  | 19105 |
|  VZ Holding AG | 285 |  | 19650 |
|  WealthNavi, Inc.\* (a) | 2400 |  | 22460 |
|  XTB SA(b) | 17952 |  | 102640 |
|  |  |  | **12770560** |
| **Chemicals – 3.4%** | **Chemicals – 3.4%** | **Chemicals – 3.4%** | **Chemicals – 3.4%** |
|  ADEKA Corp.(a) | 2300 |  | 34445 |
|  Aica Kogyo Co. Ltd.(a) | 1500 |  | 32294 |
|  Air Liquide SA | 7503 |  | 981083 |
|  Air Water, Inc. | 6000 |  | 67131 |
|  Akzo Nobel NV | 2255 |  | 139162 |
|  Arkema SA | 1599 |  | 126619 |
|  Asahi Kasei Corp. | 32800 |  | 210634 |
|  BASF SE | 19926 |  | 894791 |
|  Borregaard ASA | 1692 |  | 22751 |
|  Calix Ltd.\* (a) | 9988 |  | 25994 |
|  Chr Hansen Holding A/S | 1584 |  | 87984 |
|  Ciech SA\* | 9548 |  | 67117 |
|  Clariant AG (Registered)\* | 2836 |  | 45654 |
|  Corbion NV | 2352 |  | 62671 |
|  Covestro AG(b) | 3731 |  | 126999 |
|  Croda International plc | 2378 |  | 185083 |
|  Daicel Corp. | 8900 |  | 50777 |
|  Denka Co. Ltd. | 1400 |  | 32449 |
|  DIC Corp.(a) | 27499 |  | 462156 |
|  Elementis plc\* | 41976 |  | 44704 |
|  Elkem ASA(b) | 7 |  | 23 |
|  EMS-Chemie Holding AG (Registered) | 126 |  | 79258 |
|  Essentra plc | 16940 |  | 43884 |
|  Evonik Industries AG | 4160 |  | 76701 |
|  FUCHS PETROLUB SE | 55 |  | 1326 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  FUCHS PETROLUB SE (Preference) | 1182 | $33879 |
|  Fuso Chemical Co. Ltd. | 1100 | 24903 |
|  Givaudan SA (Registered) | 123 | 367494 |
|  Grupa Azoty SA\* | 12177 | 83709 |
|  Hexpol AB | 5784 | 57053 |
|  ICL Group Ltd. | 9848 | 89316 |
|  Incitec Pivot Ltd. | 36784 | 88206 |
|  Israel Corp. Ltd. | 104 | 45241 |
|  JCU Corp. | 1400 | 26590 |
|  Johnson Matthey plc | 4920 | 109582 |
|  JSR Corp. | 3100 | 59107 |
|  K+S AG (Registered) | 4961 | 109636 |
|  Kaneka Corp. | 21800 | 541205 |
|  Kansai Paint Co. Ltd. | 5300 | 69176 |
|  Kemira OYJ | 2992 | 39507 |
|  KH Neochem Co. Ltd.(a) | 10500 | 179362 |
|  Koninklijke DSM NV | 2756 | 324960 |
|  Kumiai Chemical Industry Co. Ltd.(a) | 8000 | 52639 |
|  Kuraray Co. Ltd. | 6700 | 46114 |
|  Kureha Corp.(a) | 6200 | 398775 |
|  LANXESS AG | 2156 | 72983 |
|  Lenzing AG(a) | 132 | 6314 |
|  Lintec Corp. | 14100 | 211735 |
|  Methanex Corp.(a) | 1290 | 44969 |
|  Mitsubishi Chemical Group Corp. | 33500 | 151481 |
|  Mitsubishi Gas Chemical Co., Inc. | 6200 | 78921 |
|  Mitsui Chemicals, Inc. | 5500 | 101944 |
|  Nihon Parkerizing Co. Ltd. | 38800 | 252689 |
|  Nippon Kayaku Co. Ltd. | 7900 | 62824 |
|  Nippon Paint Holdings Co. Ltd. | 12300 | 78615 |
|  Nippon Sanso Holdings Corp. | 2800 | 44684 |
|  Nippon Shokubai Co. Ltd. | 10700 | 384418 |
|  Nippon Soda Co. Ltd. | 9939 | 296562 |
|  Nissan Chemical Corp. | 2900 | 130723 |
|  Nitto Denko Corp. | 1800 | 94823 |
|  NOF Corp. | 1200 | 41336 |
|  Novozymes A/S, Class B | 3567 | 187382 |
|  Nufarm Ltd.(a) | 14448 | 51460 |
|  Nutrien Ltd. | 11603 | 979159 |

---

*See Accompanying Notes to the Financial Statements.* 

194 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  OCI NV | 1318 | $50438 |
|  Okamoto Industries, Inc.(a) | 5900 | 147267 |
|  Orica Ltd. | 4722 | 41910 |
|  Osaka Soda Co. Ltd.(a) | 8800 | 214028 |
|  Recticel SA | 2200 | 30398 |
|  Robertet SA | 44 | 36660 |
|  Sanyo Chemical Industries Ltd. | 3800 | 107761 |
|  Shikoku Chemicals Corp.(a) | 15500 | 135150 |
|  Shin-Etsu Chemical Co. Ltd. | 5700 | 595943 |
|  Shin-Etsu Polymer Co. Ltd.(a) | 13100 | 109288 |
|  Showa Denko KK | 4200 | 61374 |
|  Sika AG (Registered) | 2255 | 508797 |
|  SOL SpA | 3009 | 54126 |
|  Solvay SA | 1476 | 133101 |
|  Sumitomo Bakelite Co. Ltd. | 12300 | 333495 |
|  Sumitomo Chemical Co. Ltd. | 35800 | 120670 |
|  Symrise AG | 2132 | 217775 |
|  Synthomer plc(a) | 110864 | 143599 |
|  T Hasegawa Co. Ltd. | 900 | 19195 |
|  Taiyo Holdings Co. Ltd. | 1800 | 31777 |
|  Teijin Ltd. | 3000 | 27248 |
|  Tessenderlo Group SA\* | 4141 | 125443 |
|  Toagosei Co. Ltd.(a) | 38000 | 292219 |
|  Tokai Carbon Co. Ltd. | 6600 | 43116 |
|  Tokuyama Corp. | 24600 | 287153 |
|  Tokyo Ohka Kogyo Co. Ltd. | 700 | 30235 |
|  Toray Industries, Inc. | 36900 | 179864 |
|  Tosoh Corp.(a) | 7800 | 84961 |
|  Toyo Gosei Co. Ltd. | 300 | 15461 |
|  Toyo Ink SC Holdings Co. Ltd.(a) | 13900 | 179086 |
|  Toyobo Co. Ltd.(a) | 32800 | 229502 |
|  Treatt plc | 3432 | 25605 |
|  UBE Corp. | 32600 | 420454 |
|  Umicore SA | 3034 | 100005 |
|  Victrex plc | 3192 | 60750 |
|  Wacker Chemie AG | 256 | 29831 |
|  Yara International ASA | 3198 | 142723 |
|  Zeon Corp. | 3600 | 30372 |
|  |  | **15317946** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** |
|  Befesa SA(b) | 2184 | $75852 |
|  Biffa plc(b) | 15576 | 73778 |
|  Big Technologies plc\* | 11924 | 37548 |
|  Boyd Group Services, Inc. | 208 | 29561 |
|  Brambles Ltd. | 23903 | 178526 |
|  Bravida Holding AB(b) | 4312 | 40387 |
|  Caverion OYJ | 8888 | 39486 |
|  Cleanaway Waste Management Ltd. | 35024 | 60469 |
|  Coor Service Management Holding AB(b) | 6692 | 35518 |
|  Dai Nippon Printing Co. Ltd. | 5700 | 114395 |
|  Daiseki Co. Ltd. | 1499 | 46391 |
|  Derichebourg SA | 31816 | 139051 |
|  Downer EDI Ltd.(a) | 9548 | 27414 |
|  Duskin Co. Ltd. | 3700 | 70995 |
|  Elis SA | 4661 | 53851 |
|  GFL Environmental, Inc. | 1760 | 47443 |
|  HomeServe plc | 3784 | 51671 |
|  Intrum AB(a) | 2464 | 31016 |
|  ISS A/S\* | 2508 | 46048 |
|  Japan Elevator Service Holdings Co. Ltd. | 4200 | 49676 |
|  Kokuyo Co. Ltd.(a) | 32800 | 407366 |
|  Loomis AB | 2271 | 63421 |
|  Marlowe plc\* | 4092 | 37691 |
|  Mitie Group plc | 469983 | 386356 |
|  Mitsubishi Pencil Co. Ltd.(a) | 18200 | 177427 |
|  Nippon Kanzai Co. Ltd. | 1300 | 22128 |
|  Okamura Corp. | 30500 | 280920 |
|  Park24 Co. Ltd.\* | 2200 | 29381 |
|  Pilot Corp. | 1700 | 66223 |
|  Prestige International, Inc. | 4000 | 19376 |
|  Prosegur Cash SA(a) (b) | 159861 | 96063 |
|  Prosegur Cia de Seguridad SA | 77203 | 143985 |
|  Raksul, Inc.\* (a) | 1600 | 31626 |
|  Rentokil Initial plc | 30012 | 188114 |
|  Restore plc | 7172 | 29727 |
|  Ritchie Bros Auctioneers, Inc. | 2091 | 136431 |
|  Sdiptech AB, Class B\* | 1056 | 20355 |
|  Secom Co. Ltd. | 2700 | 154242 |
|  Securitas AB, Class B | 7047 | 57611 |
|  Serco Group plc | 405736 | 763313 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 195

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** |
|  SG Fleet Group Ltd.(a) | 59146 | $| 76020 |
|  Smart Metering Systems plc | 5165 |  | 43530 |
|  Societe BIC SA | 756 |  | 43412 |
|  Sohgo Security Services Co. Ltd. | 1900 |  | 47425 |
|  SPIE SA | 2992 |  | 70025 |
|  TOMRA Systems ASA(a) | 3872 |  | 62574 |
|  TOPPAN, Inc. | 8200 |  | 122419 |
|  TRE Holdings Corp. | 4200 |  | 45381 |
|  Waste Connections, Inc. | 3936 |  | 518846 |
|  |  |  | **5390464** |
| **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** |
|  AudioCodes Ltd.(a) | 1936 |  | 39650 |
|  Gilat Satellite Networks Ltd.\* (a) | 7568 |  | 45522 |
|  Nokia OYJ | 84009 |  | 374217 |
|  Spirent Communications plc | 40672 |  | 121752 |
|  Telefonaktiebolaget LM Ericsson, Class A(a) | 3789 |  | 22493 |
|  Telefonaktiebolaget LM Ericsson, Class B | 70233 |  | 390238 |
|  VTech Holdings Ltd. | 49200 |  | 261674 |
|  |  |  | **1255546** |
| **Construction & Engineering – 2.1%** | **Construction & Engineering – 2.1%** | **Construction & Engineering – 2.1%** | **Construction & Engineering – 2.1%** |
|  Ackermans & van Haaren NV | 454 |  | 63313 |
|  ACS Actividades de Construccion y Servicios SA(a) | 3133 |  | 80354 |
|  AF Gruppen ASA | 704 |  | 10198 |
|  Arcadis NV | 1848 |  | 62794 |
|  Ashtrom Group Ltd. | 1861 |  | 40697 |
|  Badger Infrastructure Solutions Ltd.(a) | 2812 |  | 59330 |
|  Balfour Beatty plc | 212339 |  | 730007 |
|  Bouygues SA | 3895 |  | 111177 |
|  Chudenko Corp. | 12300 |  | 169809 |
|  Cie d'Entreprises CFE\* | 352 |  | 3736 |
|  COMSYS Holdings Corp. | 4200 |  | 68947 |
|  Daiho Corp.(a) | 4100 |  | 116406 |
|  Eiffage SA | 1640 |  | 148377 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  Elco Ltd. | 231 | $13389 |
|  Elecnor SA | 11972 | 119509 |
|  Electra Ltd. | 15 | 8769 |
|  EXEO Group, Inc. | 3900 | 57174 |
|  Fasadgruppen Group AB | 2508 | 19972 |
|  Ferrovial SA | 6928 | 169197 |
|  Fomento de Construcciones y Contratas SA | 3980 | 33121 |
|  Fugro NV\* | 7040 | 91497 |
|  Gold Finance Holdings Ltd.\* ‡ | 89827 |  |
|  Hazama Ando Corp.(a) | 55700 | 323404 |
|  HOCHTIEF AG | 442 | 23503 |
|  Instalco AB(b) | 7260 | 29049 |
|  JGC Holdings Corp. | 5400 | 65104 |
|  Johns Lyng Group Ltd.(a) | 7568 | 31456 |
|  Kajima Corp. | 12400 | 116880 |
|  Kandenko Co. Ltd. | 35800 | 201358 |
|  Keller Group plc | 23903 | 172830 |
|  Kinden Corp. | 2300 | 23428 |
|  Kumagai Gumi Co. Ltd. | 13100 | 221572 |
|  Kyudenko Corp. | 18500 | 393312 |
|  Maire Tecnimont SpA(a) | 69044 | 214409 |
|  MIRAIT ONE Corp.(a) | 31000 | 298039 |
|  Monadelphous Group Ltd.(a) | 7216 | 63123 |
|  Morgan Sindall Group plc | 13694 | 242805 |
|  NCC AB, Class B | 25502 | 212431 |
|  Nippon Densetsu Kogyo Co. Ltd. | 18100 | 202755 |
|  Nippon Road Co. Ltd. (The) | 700 | 28869 |
|  Nishimatsu Construction Co. Ltd.(a) | 10200 | 248421 |
|  NRW Holdings Ltd.(a) | 169986 | 277179 |
|  Obayashi Corp. | 16500 | 106015 |
|  Okumura Corp.(a) | 10600 | 200540 |
|  Peab AB, Class B | 3999 | 20736 |
|  Penta-Ocean Construction Co. Ltd. | 87600 | 436129 |
|  Raito Kogyo Co. Ltd. | 15500 | 211589 |
|  Sacyr SA(a) | 36710 | 90053 |
|  Sanki Engineering Co. Ltd.(a) | 18000 | 194974 |
|  Shapir Engineering and Industry Ltd. | 2525 | 20892 |
|  Shikun & Binui Ltd.\* (a) | 3556 | 14175 |

---

*See Accompanying Notes to the Financial Statements.* 

196 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  Shimizu Corp. | 17800 | $| 88979 |
|  SHO-BOND Holdings Co. Ltd. | 1200 |  | 51993 |
|  Skanska AB, Class B | 6478 |  | 100713 |
|  SNC-Lavalin Group, Inc.(a) | 2068 |  | 35764 |
|  Stantec, Inc. | 1848 |  | 90310 |
|  Sumitomo Densetsu Co. Ltd. | 6400 |  | 112641 |
|  Sweco AB, Class B | 4708 |  | 35362 |
|  Taikisha Ltd. | 12700 |  | 299909 |
|  Taisei Corp. | 4600 |  | 125495 |
|  Takamatsu Construction Group Co. Ltd. | 4300 |  | 56124 |
|  Toda Corp. | 5200 |  | 25994 |
|  Totetsu Kogyo Co. Ltd.(a) | 10000 |  | 166112 |
|  Veidekke ASA | 3088 |  | 25692 |
|  Vestum AB\* (a) | 21560 |  | 30116 |
|  Vinci SA | 7831 |  | 721192 |
|  Webuild SpA(a) | 139810 |  | 190276 |
|  WSP Global, Inc. | 1435 |  | 176149 |
|  Yokogawa Bridge Holdings Corp. | 14800 |  | 196756 |
|  |  |  | **9392380** |
| **Construction Materials – 0.6%** | **Construction Materials – 0.6%** | **Construction Materials – 0.6%** | **Construction Materials – 0.6%** |
|  Adbri Ltd.(a) | 22176 |  | 22334 |
|  Boral Ltd.(a) | 3476 |  | 6401 |
|  Breedon Group plc | 81796 |  | 49254 |
|  Brickworks Ltd.(a) | 3147 |  | 44533 |
|  Buzzi Unicem SpA | 3148 |  | 52255 |
|  Cementir Holding NV | 18081 |  | 105256 |
|  CRH plc | 15211 |  | 548070 |
|  CSR Ltd.(a) | 15532 |  | 45985 |
|  HeidelbergCement AG | 3075 |  | 141778 |
|  Holcim AG\* | 11070 |  | 503086 |
|  Ibstock plc(b) | 27720 |  | 49629 |
|  Imerys SA | 1103 |  | 45198 |
|  James Hardie Industries plc, CHDI(a) | 6190 |  | 134579 |
|  Maeda Kosen Co. Ltd. | 1200 |  | 24422 |
|  Marshalls plc | 13860 |  | 40277 |
|  Mitani Sekisan Co. Ltd.(a) | 1200 |  | 30921 |
|  RHI Magnesita NV(a) | 10537 |  | 224680 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** |
|  Sumitomo Osaka Cement Co. Ltd.(a) | 1700 | $| 36199 |
|  Taiheiyo Cement Corp. | 2200 |  | 29914 |
|  Titan Cement International SA\* | 12505 |  | 139166 |
|  Vicat SA(a) | 6109 |  | 140078 |
|  Wienerberger AG | 2596 |  | 59372 |
|  |  |  | **2473387** |
| **Consumer Finance – 0.4%** | **Consumer Finance – 0.4%** | **Consumer Finance – 0.4%** | **Consumer Finance – 0.4%** |
|  AEON Financial Service Co. Ltd. | 400 |  | 3918 |
|  Aiful Corp.(a) | 102500 |  | 279292 |
|  Cembra Money Bank AG | 1176 |  | 85314 |
|  Credit Corp. Group Ltd.(a) | 3350 |  | 39801 |
|  Credit Saison Co. Ltd. | 6200 |  | 66324 |
|  Direct Finance of Direct Group 2006 Ltd.(a) | 369 |  | 85448 |
|  goeasy Ltd. | 528 |  | 42784 |
|  Gruppo MutuiOnline SpA | 1056 |  | 23379 |
|  Isracard Ltd. | 56580 |  | 168156 |
|  Jaccs Co. Ltd. | 8000 |  | 194301 |
|  KRUK SA | 5043 |  | 294250 |
|  Latitude Group Holdings Ltd.(a) | 88452 |  | 71832 |
|  Marui Group Co. Ltd. | 3200 |  | 52833 |
|  Orient Corp.(a) | 16400 |  | 132957 |
|  Provident Financial plc | 70643 |  | 132820 |
|  Resurs Holding AB(b) | 37356 |  | 81132 |
|  |  |  | **1754541** |
| **Containers & Packaging – 0.5%** | **Containers & Packaging – 0.5%** | **Containers & Packaging – 0.5%** | **Containers & Packaging – 0.5%** |
|  Billerud AB | 3558 |  | 45914 |
|  Cascades, Inc.(a) | 25871 |  | 167662 |
|  CCL Industries, Inc., Class B | 2759 |  | 129450 |
|  DS Smith plc | 26376 |  | 88128 |
|  FP Corp. | 1200 |  | 28621 |
|  Fuji Seal International, Inc.(a) | 14300 |  | 167692 |
|  Huhtamaki OYJ | 2051 |  | 73685 |
|  Infinya Ltd.(a) | 798 |  | 77340 |
|  Mayr Melnhof Karton AG(a) | 275 |  | 39139 |
|  Orora Ltd. | 19096 |  | 36999 |
|  Pact Group Holdings Ltd.(a) | 74172 |  | 68061 |
|  Rengo Co. Ltd.(a) | 79000 |  | 438490 |
|  SIG Group AG\* | 6150 |  | 118237 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 197

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** |
|  Smurfit Kappa Group plc | 4018 | $| 133154 |
|  Toyo Seikan Group Holdings Ltd. | 5600 |  | 64087 |
|  Transcontinental, Inc., Class A(a) | 21197 |  | 241643 |
|  Verallia SA(b) | 1364 |  | 38664 |
|  Vidrala SA(a) | 924 |  | 70593 |
|  Winpak Ltd. | 1716 |  | 52233 |
|  |  |  | **2079792** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  Bapcor Ltd.(a) | 6776 |  | 28684 |
|  D'ieteren Group | 220 |  | 36595 |
|  Inchcape plc | 8938 |  | 76563 |
|  Inter Cars SA | 484 |  | 36518 |
|  PALTAC Corp. | 800 |  | 22767 |
|  Uni-Select, Inc.\* | 1554 |  | 42095 |
|  |  |  | **243222** |
| **Diversified Consumer Services – 0.1%** | **Diversified Consumer Services – 0.1%** | **Diversified Consumer Services – 0.1%** | **Diversified Consumer Services – 0.1%** |
|  AcadeMedia AB(b) | 26691 |  | 114151 |
|  Benesse Holdings, Inc.(a) | 6200 |  | 91518 |
|  G8 Education Ltd.(a) | 51492 |  | 31774 |
|  IDP Education Ltd.(a) | 2501 |  | 47322 |
|  InvoCare Ltd.(a) | 4432 |  | 28964 |
|  LITALICO, Inc. | 1200 |  | 25431 |
|  Park Lawn Corp. | 1496 |  | 23196 |
|  Perfect Medical Health Management Ltd.(a) | 88000 |  | 31165 |
|  |  |  | **393521** |
| **Diversified Financial Services – 1.0%** | **Diversified Financial Services – 1.0%** | **Diversified Financial Services – 1.0%** | **Diversified Financial Services – 1.0%** |
|  AMP Ltd.\* | 65142 |  | 52485 |
|  Banca IFIS SpA | 8487 |  | 100238 |
|  Banca Mediolanum SpA | 4444 |  | 33293 |
|  BFF Bank SpA(b) | 10956 |  | 77315 |
|  Burford Capital Ltd. | 12915 |  | 104831 |
|  Challenger Ltd.(a) | 9812 |  | 44045 |
|  Creades AB, Class A(a) | 20582 |  | 138108 |
|  ECN Capital Corp. | 16720 |  | 50379 |
|  eGuarantee, Inc.(a) | 2800 |  | 45324 |
|  Element Fleet Management Corp.(a) | 9751 |  | 129746 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** |
|  Eurazeo SE | 1144 | $| 65353 |
|  Fuyo General Lease Co. Ltd. | 7100 |  | 394564 |
|  GRENKE AG | 1804 |  | 36801 |
|  Groupe Bruxelles Lambert NV | 1312 |  | 96735 |
|  HAL Trust | 1215 |  | 140019 |
|  Hypoport SE\* | 88 |  | 8611 |
|  Illimity Bank SpA\* (a) | 3080 |  | 20944 |
|  Industrivarden AB, Class A | 3388 |  | 76710 |
|  Industrivarden AB, Class C | 3828 |  | 85945 |
|  Investment AB Oresund | 9198 |  | 95389 |
|  Investor AB, Class A(a) | 7798 |  | 132596 |
|  Investor AB, Class B | 27506 |  | 448939 |
|  Japan Securities Finance Co. Ltd. | 8800 |  | 52752 |
|  Kinnevik AB, Class B\* | 4578 |  | 56549 |
|  L E Lundbergforetagen AB, Class B | 1348 |  | 53210 |
|  M&G plc | 67732 |  | 136627 |
|  Mitsubishi HC Capital, Inc. | 23929 |  | 102713 |
|  Mizuho Leasing Co. Ltd. | 12438 |  | 271128 |
|  ORIX Corp. | 26100 |  | 383681 |
|  PEUGEOT INVEST | 308 |  | 25388 |
|  Plus500 Ltd. | 36162 |  | 751514 |
|  Ricoh Leasing Co. Ltd. | 5400 |  | 131880 |
|  Sofina SA | 316 |  | 61683 |
|  SRH NV\* ‡ | 2857 |  |  |
|  Svolder AB, Class B(a) | 31980 |  | 165855 |
|  Tokyo Century Corp. | 600 |  | 20466 |
|  Wendel SE | 497 |  | 38953 |
|  Zenkoku Hosho Co. Ltd.(a) | 600 |  | 19820 |
|  |  |  | **4650589** |
| **Diversified Telecommunication Services – 1.2%** | **Diversified Telecommunication Services – 1.2%** | **Diversified Telecommunication Services – 1.2%** | **Diversified Telecommunication Services – 1.2%** |
|  Aussie Broadband Ltd.\* (a) | 13244 |  | 19817 |
|  BCE, Inc.(a) | 4223 |  | 190245 |
|  Bezeq The Israeli Telecommunication Corp. Ltd. | 52780 |  | 93848 |
|  BT Group plc | 121483 |  | 181550 |
|  Cellnex Telecom SA(b) | 8323 |  | 272282 |
|  Chorus Ltd. | 13585 |  | 65584 |
|  Deutsche Telekom AG (Registered) | 72119 |  | 1365987 |
|  Elisa OYJ | 2378 |  | 114953 |

---

*See Accompanying Notes to the Financial Statements.* 

198 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |
|  Gamma Communications plc | 3432 | $| 42043 |
|  Helios Towers plc\* | 10824 |  | 15640 |
|  HKBN Ltd. | 51500 |  | 34771 |
|  HKT Trust & HKT Ltd. | 53400 |  | 60340 |
|  Infrastrutture Wireless Italiane SpA(b) | 5179 |  | 45720 |
|  Internet Initiative Japan, Inc. | 2000 |  | 31460 |
|  Koninklijke KPN NV | 53546 |  | 149823 |
|  NetLink NBN Trust(b) | 61600 |  | 37219 |
|  Nippon Telegraph & Telephone Corp. | 25600 |  | 705126 |
|  NOS SGPS SA | 20496 |  | 80300 |
|  Orange SA | 41984 |  | 399637 |
|  PCCW Ltd. | 36035 |  | 13772 |
|  Proximus SADP | 2464 |  | 25838 |
|  RAI Way SpA(b) | 8120 |  | 38907 |
|  Singapore Telecommunications Ltd. | 123000 |  | 217299 |
|  Spark New Zealand Ltd. | 20724 |  | 61643 |
|  Swisscom AG (Registered) | 369 |  | 182260 |
|  Telecom Italia SpA\* (a) | 112508 |  | 22028 |
|  Telecom Italia SpA\* | 96272 |  | 18412 |
|  Telefonica Deutschland Holding AG | 24508 |  | 53435 |
|  Telefonica SA | 114440 |  | 394177 |
|  Telekom Austria AG\* | 1426 |  | 8287 |
|  Telenor ASA | 12054 |  | 109562 |
|  Telia Co. AB(a) | 30873 |  | 81719 |
|  Telstra Group Ltd. | 63919 |  | 160222 |
|  TELUS Corp. | 6318 |  | 131775 |
|  TELUS Corp.\* | 2497 |  | 52080 |
|  United Internet AG (Registered) | 1848 |  | 34566 |
|  |  |  | **5512327** |
| **Electric Utilities – 1.3%** | **Electric Utilities – 1.3%** | **Electric Utilities – 1.3%** | **Electric Utilities – 1.3%** |
|  Acciona SA(a) | 516 |  | 92869 |
|  BKW AG | 440 |  | 51353 |
|  Chubu Electric Power Co., Inc.(a) | 16400 |  | 133619 |
|  Chugoku Electric Power Co., Inc. (The) | 4206 |  | 19752 |
|  CK Infrastructure Holdings Ltd. | 11000 |  | 52268 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  CLP Holdings Ltd. | 25500 | $171194 |
|  Contact Energy Ltd. | 11528 | 50564 |
|  EDP – Energias de Portugal SA | 39811 | 174111 |
|  Electricite de France SA | 12294 | 145202 |
|  Elia Group SA/NV(a) | 476 | 60171 |
|  Emera, Inc.(a) | 3649 | 135067 |
|  Endesa SA(a) | 5986 | 99896 |
|  Enea SA\* | 60803 | 66457 |
|  Enel SpA | 156415 | 698605 |
|  EVN AG | 748 | 12450 |
|  Fortis, Inc. | 6642 | 258804 |
|  Fortum OYJ | 9225 | 129879 |
|  Genesis Energy Ltd.(a) | 15388 | 25299 |
|  HK Electric Investments & HK Electric Investments Ltd.(b) | 44500 | 28288 |
|  Hokkaido Electric Power Co., Inc.(a) | 72200 | 220046 |
|  Hokuriku Electric Power Co.(a) | 66100 | 221467 |
|  Hydro One Ltd.(b) | 4633 | 116025 |
|  Iberdrola SA | 82620 | 839031 |
|  Infratil Ltd. | 8272 | 42001 |
|  Kansai Electric Power Co., Inc. (The) | 20500 | 155438 |
|  Kyushu Electric Power Co., Inc. | 13200 | 65452 |
|  Manawa Energy Ltd.(a) | 5123 | 15685 |
|  Mercury NZ Ltd. | 17980 | 60793 |
|  Okinawa Electric Power Co., Inc. (The)(a) | 17170 | 119330 |
|  Origin Energy Ltd. | 26363 | 93898 |
|  Orsted A/S(b) | 2870 | 236762 |
|  PGE Polska Grupa Energetyczna SA\* | 10843 | 12385 |
|  Power Assets Holdings Ltd. | 22500 | 107629 |
|  Red Electrica Corp. SA | 4830 | 78050 |
|  Romande Energie Holding SA (Registered) | 21 | 23502 |
|  Shikoku Electric Power Co., Inc. | 61500 | 296256 |
|  SSE plc | 14329 | 256704 |
|  Terna – Rete Elettrica Nazionale | 21416 | 141985 |
|  Tohoku Electric Power Co., Inc. | 10900 | 45834 |
|  Tokyo Electric Power Co. Holdings, Inc.\* | 22400 | 73092 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 199

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Verbund AG | 924 | $| 72374 |
|  |  |  | **5699587** |
| **Electrical Equipment – 1.5%** | **Electrical Equipment – 1.5%** | **Electrical Equipment – 1.5%** | **Electrical Equipment – 1.5%** |
|  ABB Ltd. (Registered) | 25133 |  | 699178 |
|  Alfen Beheer BV\* (b) | 945 |  | 100451 |
|  Ballard Power Systems, Inc.\* (a) | 18450 |  | 104420 |
|  Ceres Power Holdings plc\* (a) | 12012 |  | 45335 |
|  Daihen Corp.(a) | 8200 |  | 212124 |
|  DiscoverIE Group plc | 4796 |  | 41138 |
|  Fagerhult AB | 6336 |  | 25228 |
|  Fuji Electric Co. Ltd. | 1500 |  | 58129 |
|  Fujikura Ltd. | 86100 |  | 509759 |
|  Furukawa Electric Co. Ltd.(a) | 24600 |  | 380002 |
|  GARO AB(a) (b) | 1980 |  | 19961 |
|  GS Yuasa Corp. | 27300 |  | 416383 |
|  Huber + Suhner AG (Registered) | 867 |  | 77278 |
|  Idec Corp. | 2200 |  | 47216 |
|  ITM Power plc\* (a) | 10192 |  | 9700 |
|  Legrand SA | 4264 |  | 325093 |
|  Mabuchi Motor Co. Ltd. | 1600 |  | 43489 |
|  Mitsubishi Electric Corp. | 47000 |  | 414236 |
|  NEL ASA\* (a) | 12688 |  | 15505 |
|  Nexans SA | 748 |  | 69936 |
|  Nidec Corp. | 8310 |  | 460577 |
|  Nissin Electric Co. Ltd.(a) | 17600 |  | 163644 |
|  NKT A/S\* | 2706 |  | 135218 |
|  Nordex SE\* | 7130 |  | 66650 |
|  PowerCell Sweden AB\* (a) | 2948 |  | 32413 |
|  Prysmian SpA | 3936 |  | 128336 |
|  Sanyo Denki Co. Ltd.(a) | 4100 |  | 150335 |
|  Schneider Electric SE | 8159 |  | 1034282 |
|  Siemens Energy AG | 6384 |  | 74548 |
|  Siemens Gamesa Renewable Energy SA\* | 4136 |  | 73417 |
|  Signify NV(b) | 2730 |  | 75711 |
|  Somfy SA | 275 |  | 29300 |
|  TKH Group NV, CVA | 2194 |  | 77760 |
|  Ushio, Inc. | 4200 |  | 43686 |
|  Varta AG | 352 |  | 9452 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** |
|  Vestas Wind Systems A/S | 15621 | $| 307752 |
|  |  |  | **6477642** |
| **Electronic Equipment, Instruments & Components – 1.7%** | **Electronic Equipment, Instruments & Components – 1.7%** | **Electronic Equipment, Instruments & Components – 1.7%** | **Electronic Equipment, Instruments & Components – 1.7%** |
|  Ai Holdings Corp.(a) | 3800 |  | 56347 |
|  Alps Alpine Co. Ltd. | 5348 |  | 46055 |
|  ALSO Holding AG (Registered)\* | 52 |  | 8179 |
|  Amano Corp. | 4900 |  | 83966 |
|  Anritsu Corp. | 4700 |  | 47400 |
|  AT&S Austria Technologie & Systemtechnik AG(a) | 880 |  | 27180 |
|  Azbil Corp.(a) | 2100 |  | 57150 |
|  Barco NV | 3034 |  | 65551 |
|  Basler AG | 792 |  | 21526 |
|  Canon Marketing Japan, Inc. | 1500 |  | 31688 |
|  Celestica, Inc.\* | 36695 |  | 402178 |
|  Citizen Watch Co. Ltd.(a) | 22400 |  | 94190 |
|  Codan Ltd.(a) | 7304 |  | 18075 |
|  Comet Holding AG (Registered) | 462 |  | 73772 |
|  Daiwabo Holdings Co. Ltd. | 32800 |  | 424358 |
|  Dexerials Corp. | 3500 |  | 81828 |
|  FIH Mobile Ltd.\* (a) | 328000 |  | 26742 |
|  FIT Hon Teng Ltd.\* (a) (b) | 474000 |  | 55553 |
|  Halma plc | 6519 |  | 158745 |
|  Hamamatsu Photonics KK | 2700 |  | 122434 |
|  Hexagon AB, Class B | 27593 |  | 272673 |
|  Hioki EE Corp. | 700 |  | 33438 |
|  Hirose Electric Co. Ltd. | 582 |  | 75611 |
|  Horiba Ltd. | 800 |  | 32940 |
|  Hosiden Corp. | 20500 |  | 216537 |
|  Ibiden Co. Ltd.(a) | 2800 |  | 94756 |
|  Inficon Holding AG (Registered)(a) | 126 |  | 100221 |
|  Iriso Electronics Co. Ltd. | 1200 |  | 34877 |
|  Japan Aviation Electronics Industry Ltd.(a) | 20544 |  | 320527 |
|  Jenoptik AG | 2585 |  | 56770 |
|  Kaga Electronics Co. Ltd. | 8300 |  | 246540 |
|  Keyence Corp. | 3000 |  | 1136744 |
|  Kyocera Corp. | 5700 |  | 285355 |
|  Lagercrantz Group AB, Class B | 2640 |  | 22636 |

---

*See Accompanying Notes to the Financial Statements.* 

200 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** |
|  Landis+Gyr Group AG\* (a) | 1102 | $| 63538 |
|  LEM Holding SA (Registered) | 27 |  | 45002 |
|  Macnica Holdings, Inc. | 16500 |  | 330588 |
|  Maruwa Co. Ltd. | 600 |  | 70683 |
|  Meiko Electronics Co. Ltd.(a) | 8200 |  | 145811 |
|  Murata Manufacturing Co. Ltd. | 9000 |  | 442022 |
|  Mycronic AB | 924 |  | 14516 |
|  NCAB Group AB | 5280 |  | 23023 |
|  Nichicon Corp. | 3200 |  | 30163 |
|  Nippon Electric Glass Co. Ltd. | 2200 |  | 38158 |
|  Nissha Co. Ltd.(a) | 16400 |  | 193421 |
|  Nohmi Bosai Ltd. | 10700 |  | 115613 |
|  Novonix Ltd.\* (a) | 6864 |  | 11763 |
|  Oki Electric Industry Co. Ltd. | 32800 |  | 162637 |
|  Omron Corp. | 2500 |  | 116998 |
|  Oxford Instruments plc | 3036 |  | 66904 |
|  Renishaw plc | 880 |  | 35482 |
|  Riken Keiki Co. Ltd. | 1200 |  | 33101 |
|  Sensirion Holding AG\* (b) | 528 |  | 48118 |
|  Sesa SpA | 294 |  | 31876 |
|  Shimadzu Corp. | 4900 |  | 129394 |
|  Softwareone Holding AG\* | 3256 |  | 36668 |
|  Spectris plc | 2112 |  | 73436 |
|  Taiyo Yuden Co. Ltd. | 2500 |  | 68204 |
|  TDK Corp. | 8200 |  | 256810 |
|  Topcon Corp. | 6400 |  | 70228 |
|  Vaisala OYJ, Class A | 836 |  | 32513 |
|  Venture Corp. Ltd. | 4500 |  | 50657 |
|  VSTECS Holdings Ltd. | 250000 |  | 120066 |
|  Yokogawa Electric Corp. | 4900 |  | 82120 |
|  |  |  | **7772055** |
| **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** |
|  Aker Solutions ASA(a) (b) | 7560 |  | 28940 |
|  Borr Drilling Ltd.\* (a) | 8106 |  | 39529 |
|  BW Offshore Ltd.(a) | 41194 |  | 104918 |
|  Drilling Co. of 1972 A/S (The)\* | 843 |  | 41632 |
|  John Wood Group plc\* | 234356 |  | 377486 |
|  Lapidoth Capital Ltd.(a) | 2352 |  | 44708 |
|  Pason Systems, Inc. | 2898 |  | 30742 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** |
|  Petrofac Ltd.\* (a) | 20076 | $| 24894 |
|  Precision Drilling Corp.\* | 462 |  | 34039 |
|  Saipem SpA\* (a) | 65310 |  | 63516 |
|  SBM Offshore NV | 7626 |  | 103259 |
|  Secure Energy Services, Inc. | 16104 |  | 84413 |
|  Subsea 7 SA | 26 |  | 260 |
|  Technip Energies NV | 41492 |  | 535778 |
|  Tenaris SA | 7474 |  | 116012 |
|  TGS ASA | 3948 |  | 53922 |
|  Vallourec SA\* | 8806 |  | 93781 |
|  Worley Ltd.(a) | 7728 |  | 70518 |
|  |  |  | **1848347** |
| **Entertainment – 0.5%** | **Entertainment – 0.5%** | **Entertainment – 0.5%** | **Entertainment – 0.5%** |
|  Bollore SE | 12858 |  | 64367 |
|  Capcom Co. Ltd.(a) | 3400 |  | 94816 |
|  CD Projekt SA | 1193 |  | 31779 |
|  CTS Eventim AG & Co. KGaA\* | 704 |  | 33635 |
|  Daiichikosho Co. Ltd. | 1100 |  | 31601 |
|  DeNA Co. Ltd. | 1100 |  | 14365 |
|  Embracer Group AB\* (a) | 6644 |  | 31968 |
|  EVT Ltd.\* (a) | 2282 |  | 21801 |
|  Kahoot! ASA\* | 34776 |  | 74155 |
|  Kinepolis Group NV\* | 1030 |  | 38847 |
|  Koei Tecmo Holdings Co. Ltd. | 2492 |  | 37690 |
|  Konami Group Corp. | 1000 |  | 43933 |
|  MIXI, Inc.(a) | 4200 |  | 65896 |
|  Modern Times Group MTG AB, Class B\* | 7040 |  | 52693 |
|  Nexon Co. Ltd. | 8200 |  | 137756 |
|  Nintendo Co. Ltd. | 16600 |  | 677916 |
|  Paradox Interactive AB | 952 |  | 16420 |
|  Shochiku Co. Ltd.\* (a) | 800 |  | 63565 |
|  Square Enix Holdings Co. Ltd. | 1800 |  | 80412 |
|  Stillfront Group AB\* | 132225 |  | 257380 |
|  Team17 Group plc\* | 5676 |  | 26957 |
|  Toei Animation Co. Ltd. | 200 |  | 20601 |
|  Toho Co. Ltd. | 1200 |  | 42789 |
|  Ubisoft Entertainment SA\* | 1425 |  | 39111 |
|  Universal Music Group NV | 9143 |  | 179392 |
|  |  |  | **2179845** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 201

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** |
|  Activia Properties, Inc.(a) | 15 | $44455 |
|  Advance Logistics Investment Corp. | 44 | 43042 |
|  Advance Residence Investment Corp. | 18 | 41901 |
|  Aedifica SA | 704 | 53716 |
|  AEON REIT Investment Corp. | 29 | 31217 |
|  Allied Properties REIT | 1540 | 29794 |
|  Altarea SCA | 88 | 11724 |
|  Arena REIT(a) | 14580 | 36640 |
|  ARGAN SA | 991 | 74341 |
|  Argosy Property Ltd. | 68432 | 47110 |
|  Artis REIT(a) | 21279 | 148979 |
|  Assura plc | 57957 | 37335 |
|  Big Yellow Group plc | 4224 | 54761 |
|  Boardwalk REIT(a) | 7421 | 263751 |
|  British Land Co. plc (The) | 10868 | 45785 |
|  BWP Trust(a) | 12444 | 32466 |
|  Canadian Apartment Properties REIT(a) | 1012 | 31301 |
|  Capital & Counties Properties plc | 43340 | 53442 |
|  CapitaLand Ascendas REIT | 64135 | 118743 |
|  CapitaLand Ascott Trust | 30164 | 20357 |
|  CapitaLand China Trust | 73814 | 50597 |
|  CapitaLand Integrated Commercial Trust | 75746 | 100631 |
|  Carmila SA(a) | 21812 | 305260 |
|  CDL Hospitality Trusts | 38294 | 31391 |
|  Centuria Capital Group(a) | 23730 | 25568 |
|  Centuria Industrial REIT(a) | 20824 | 40347 |
|  Champion REIT | 108000 | 32332 |
|  Charter Hall Group(a) | 8140 | 67354 |
|  Charter Hall Long Wale REIT(a) | 7926 | 22047 |
|  Charter Hall Retail REIT(a) | 6292 | 16134 |
|  Charter Hall Social Infrastructure REIT(a) | 16370 | 36323 |
|  Choice Properties REIT | 3957 | 37973 |
|  Cofinimmo SA | 526 | 43643 |
|  Comforia Residential REIT, Inc. | 19 | 40330 |
|  Covivio | 660 | 35355 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  CRE Logistics REIT, Inc.(a) | 44 | $60567 |
|  Crombie REIT | 3256 | 35590 |
|  Cromwell European REIT(b) | 23174 | 35959 |
|  Cromwell Property Group(a) | 398438 | 178347 |
|  CT REIT(a) | 3432 | 38999 |
|  Daiwa House REIT Investment Corp. | 42 | 84771 |
|  Daiwa Securities Living Investments Corp. | 26 | 20186 |
|  Derwent London plc | 1508 | 37572 |
|  Dexus | 14476 | 71832 |
|  Dexus Industria REIT(a) | 18568 | 31464 |
|  Dream Office REIT(a) | 1452 | 16404 |
|  Eurocommercial Properties NV | 16031 | 352693 |
|  Far East Hospitality Trust | 53976 | 21932 |
|  First Capital REIT(a) | 1819 | 21136 |
|  Fortune REIT | 92000 | 58717 |
|  Frasers Centrepoint Trust | 33249 | 48871 |
|  Frasers Hospitality Trust | 39200 | 12327 |
|  Frasers Logistics & Commercial Trust(b) | 43839 | 34077 |
|  Frontier Real Estate Investment Corp.(a) | 12 | 42386 |
|  Fukuoka REIT Corp. | 26 | 30367 |
|  Gecina SA | 704 | 62796 |
|  Global One Real Estate Investment Corp. | 48 | 37073 |
|  GLP J-REIT | 74 | 76721 |
|  Goodman Group | 25707 | 279452 |
|  Goodman Property Trust | 19085 | 22951 |
|  GPT Group (The) | 29568 | 81490 |
|  Granite REIT(a) | 484 | 24703 |
|  Great Portland Estates plc | 14238 | 84260 |
|  Growthpoint Properties Australia Ltd. | 4004 | 8500 |
|  H&R REIT(a) | 5632 | 46285 |
|  Hamborner REIT AG | 6058 | 43229 |
|  Hammerson plc(a) | 171380 | 37737 |
|  Hankyu Hanshin REIT, Inc. | 26 | 26991 |
|  Heiwa Real Estate REIT, Inc. | 43 | 44581 |
|  Home Consortium Ltd.(a) | 9954 | 30552 |
|  Hoshino Resorts REIT, Inc.(a) | 16 | 75998 |
|  Hulic Reit, Inc. | 65 | 76136 |

---

*See Accompanying Notes to the Financial Statements.* 

202 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  ICADE | 836 | $31117 |
|  Ichigo Office REIT Investment Corp.(a) | 128 | 72252 |
|  Industrial & Infrastructure Fund Investment Corp. | 44 | 46476 |
|  Ingenia Communities Group(a) | 28760 | 72091 |
|  Inmobiliaria Colonial Socimi SA | 7185 | 37885 |
|  InterRent REIT(a) | 6380 | 53648 |
|  Invincible Investment Corp. | 121 | 38017 |
|  Japan Excellent, Inc. | 42 | 38854 |
|  Japan Hotel REIT Investment Corp. | 77 | 40563 |
|  Japan Logistics Fund, Inc. | 19 | 40714 |
|  Japan Metropolitan Fund Invest | 144 | 106085 |
|  Japan Prime Realty Investment Corp. | 13 | 35291 |
|  Japan Real Estate Investment Corp. | 24 | 100595 |
|  Kenedix Office Investment Corp.(a) | 18 | 40993 |
|  Kenedix Residential Next Investment Corp. | 42 | 61544 |
|  Kenedix Retail REIT Corp. | 31 | 55749 |
|  Keppel DC REIT | 21100 | 26243 |
|  Keppel Pacific Oak US REIT(b) | 241900 | 130626 |
|  Keppel REIT | 27933 | 17667 |
|  Killam Apartment REIT(a) | 16072 | 186047 |
|  Kiwi Property Group Ltd. | 57540 | 30252 |
|  Klepierre SA\* | 3960 | 79647 |
|  Land Securities Group plc | 12222 | 80266 |
|  LaSalle Logiport REIT | 44 | 46980 |
|  Lendlease Global Commercial REIT | 606800 | 300163 |
|  Link REIT | 31923 | 188695 |
|  LondonMetric Property plc | 19734 | 42465 |
|  LXI REIT plc(b) | 118203 | 165761 |
|  Manulife US REIT(b) | 114400 | 41756 |
|  Mapletree Industrial Trust | 35086 | 54547 |
|  Mapletree Logistics Trust | 45115 | 48459 |
|  Mapletree Pan Asia Commercial Trust | 59162 | 66474 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Menivim- The New REIT Ltd. | 159941 | $81436 |
|  Mercialys SA(a) | 30586 | 264963 |
|  Merlin Properties Socimi SA(a) | 2992 | 25343 |
|  Mirai Corp. | 88 | 28359 |
|  Mirvac Group(a) | 63924 | 84614 |
|  Mitsubishi Estate Logistics REIT Investment Corp.(a) | 15 | 44404 |
|  Mitsui Fudosan Logistics Park, Inc. | 9 | 29852 |
|  Montea NV | 405 | 27659 |
|  Mori Hills REIT Investment Corp. | 16 | 17514 |
|  Mori Trust Sogo Reit, Inc. | 42 | 41905 |
|  National Storage REIT(a) | 8949 | 14936 |
|  Nextensa SA | 1012 | 50211 |
|  Nippon Accommodations Fund, Inc. | 8 | 34070 |
|  Nippon Building Fund, Inc. | 24 | 106731 |
|  Nippon Prologis REIT, Inc. | 41 | 85925 |
|  NIPPON REIT Investment Corp. | 11 | 27160 |
|  Nomura Real Estate Master Fund, Inc. | 93 | 106055 |
|  NorthWest Healthcare Properties REIT(a) | 4268 | 33605 |
|  NTT UD REIT Investment Corp.(a) | 65 | 63673 |
|  One REIT, Inc. | 14 | 23350 |
|  Orix JREIT, Inc. | 49 | 65769 |
|  OUE Commercial REIT | 2977 | 684 |
|  Parkway Life REIT | 12500 | 35333 |
|  Precinct Properties New Zealand Ltd.(a) | 22735 | 16312 |
|  Primary Health Properties plc | 29080 | 37198 |
|  Prime US REIT(b) | 172200 | 80934 |
|  Property for Industry Ltd. | 26697 | 38774 |
|  Reit 1 Ltd. | 54038 | 284815 |
|  RioCan REIT(a) | 2596 | 36940 |
|  Rural Funds Group | 20724 | 33793 |
|  Safestore Holdings plc | 4488 | 46686 |
|  Samty Residential Investment Corp. | 44 | 35553 |
|  Sasseur REIT(b) | 149600 | 75059 |
|  Scentre Group(a) | 67117 | 124462 |
|  Segro plc | 17794 | 160824 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 203

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Sekisui House Reit, Inc.(a) | 55 | $| 29640 |
|  Sella Capital Real Estate Ltd. | 73127 |  | 188911 |
|  Shaftesbury plc | 8712 |  | 36872 |
|  Shopping Centres Australasia Property Group(a) | 32912 |  | 57244 |
|  SOSiLA Logistics REIT, Inc.(a) | 207 |  | 198456 |
|  Star Asia Investment Corp. | 66 |  | 25177 |
|  Starhill Global REIT | 146296 |  | 53242 |
|  Stockland | 53956 |  | 124208 |
|  Stride Property Group | 32208 |  | 29938 |
|  Summit Industrial Income REIT(a) | 3212 |  | 40996 |
|  Sunlight REIT | 55000 |  | 17516 |
|  Suntec REIT | 43500 |  | 39654 |
|  Target Healthcare REIT plc | 40084 |  | 40013 |
|  Tokyu REIT, Inc. | 63 |  | 89731 |
|  Tritax Big Box REIT plc | 33836 |  | 54657 |
|  UK Commercial Property REIT Ltd. | 63932 |  | 44901 |
|  Unibail-Rodamco-Westfield\* (a) | 2952 |  | 139695 |
|  Unibail-Rodamco-Westfield, CHDI\* | 5 |  | 12 |
|  UNITE Group plc (The) | 6093 |  | 62505 |
|  United Urban Investment Corp. | 40 |  | 42305 |
|  Urban Logistics REIT plc | 16506 |  | 24991 |
|  Vicinity Ltd.(a) | 65692 |  | 81703 |
|  Vital Healthcare Property Trust | 28750 |  | 39083 |
|  Warehouse Reit plc(a) (b) | 20284 |  | 28025 |
|  Warehouses De Pauw CVA | 2992 |  | 76827 |
|  Waypoint REIT Ltd. | 43262 |  | 75522 |
|  Workspace Group plc | 8954 |  | 42206 |
|  Xior Student Housing NV(b) | 925 |  | 26010 |
|  |  |  | **10752660** |
| **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** |
|  Aeon Co. Ltd. | 13813 |  | 258027 |
|  Ain Holdings, Inc. | 800 |  | 33639 |
|  Alimentation Couche-Tard, Inc. | 12423 |  | 555554 |
|  Arcs Co. Ltd. | 19218 |  | 256524 |
|  Axfood AB | 1496 |  | 37013 |
|  Axial Retailing, Inc.(a) | 8200 |  | 187022 |
|  Belc Co. Ltd.(a) | 4900 |  | 187580 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** |
|  Carrefour SA | 12546 | $201931 |
|  Casino Guichard Perrachon SA\* (a) | 20500 | 197344 |
|  Coles Group Ltd.(a) | 18450 | 192659 |
|  Cosmos Pharmaceutical Corp. | 200 | 19376 |
|  Create SD Holdings Co. Ltd. | 500 | 10664 |
|  DFI Retail Group Holdings Ltd. | 7600 | 17024 |
|  Dino Polska SA\* (b) | 1012 | 66217 |
|  Empire Co. Ltd., Class A | 3212 | 82416 |
|  Endeavour Group Ltd.(a) | 23616 | 107974 |
|  Etablissements Franz Colruyt NV | 1044 | 25167 |
|  Fuji Co. Ltd.(a) | 4200 | 52050 |
|  George Weston Ltd. | 1148 | 126200 |
|  GrainCorp Ltd., Class A | 70479 | 377217 |
|  Heiwado Co. Ltd.(a) | 13500 | 171026 |
|  HelloFresh SE\* | 1980 | 39647 |
|  Inageya Co. Ltd.(a) | 11198 | 84907 |
|  J Sainsbury plc | 32120 | 71892 |
|  Jeronimo Martins SGPS SA | 5155 | 106892 |
|  Kato Sangyo Co. Ltd. | 11300 | 264568 |
|  Kesko OYJ, Class A | 2248 | 43236 |
|  Kesko OYJ, Class B | 4715 | 91803 |
|  Kobe Bussan Co. Ltd.(a) | 1900 | 41353 |
|  Koninklijke Ahold Delhaize NV | 22960 | 641064 |
|  Kusuri no Aoki Holdings Co. Ltd.(a) | 600 | 28984 |
|  Lawson, Inc. | 800 | 25566 |
|  Life Corp. | 8200 | 122364 |
|  Loblaw Cos. Ltd. | 2460 | 201301 |
|  Marks & Spencer Group plc\* | 48796 | 59271 |
|  MARR SpA | 1155 | 12169 |
|  MatsukiyoCocokara & Co. | 2400 | 87516 |
|  Maxvalu Tokai Co. Ltd. | 500 | 9433 |
|  Metcash Ltd.(a) | 17514 | 45917 |
|  Metro, Inc. | 3608 | 188778 |
|  Mitsubishi Shokuhin Co. Ltd. | 5500 | 111380 |
|  North West Co., Inc. (The)(a) | 1428 | 37112 |
|  Ocado Group plc\* (a) | 9870 | 53683 |
|  Oisix ra daichi, Inc.\* (a) | 2000 | 22646 |
|  Seven & i Holdings Co. Ltd. | 12600 | 470821 |
|  Sheng Siong Group Ltd. | 17900 | 19733 |
|  Shop Apotheke Europe NV\* (a) (b) | 748 | 31013 |

---

*See Accompanying Notes to the Financial Statements.* 

204 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** |
|  Shufersal Ltd. | 3578 | $| 24531 |
|  Sligro Food Group NV(a) | 2552 |  | 37027 |
|  Sonae SGPS SA | 333658 |  | 321032 |
|  Sugi Holdings Co. Ltd. | 800 |  | 32132 |
|  Sundrug Co. Ltd. | 1600 |  | 37246 |
|  Tesco plc | 166418 |  | 412143 |
|  Tsuruha Holdings, Inc. | 900 |  | 52377 |
|  United Super Markets Holdings, Inc. | 2000 |  | 14102 |
|  Valor Holdings Co. Ltd. | 14200 |  | 164322 |
|  Welcia Holdings Co. Ltd. | 2300 |  | 48125 |
|  Woolworths Group Ltd. | 17958 |  | 379177 |
|  Zur Rose Group AG\* (a) | 260 |  | 7030 |
|  |  |  | **7604917** |
| **Food Products – 2.9%** | **Food Products – 2.9%** | **Food Products – 2.9%** | **Food Products – 2.9%** |
|  a2 Milk Co. Ltd. (The)\* (a) | 12579 |  | 42385 |
|  AAK AB | 2860 |  | 41669 |
|  Agrana Beteiligungs AG(a) | 5885 |  | 79685 |
|  Ajinomoto Co., Inc. | 8200 |  | 225971 |
|  Ariake Japan Co. Ltd. | 800 |  | 27719 |
|  Aryzta AG\* | 62524 |  | 64102 |
|  Associated British Foods plc | 7339 |  | 114030 |
|  Ausnutria Dairy Corp. Ltd.\* | 98000 |  | 46192 |
|  Austevoll Seafood ASA | 3432 |  | 25385 |
|  Bakkafrost P/F | 1281 |  | 64008 |
|  Bakkavor Group plc(b) | 38192 |  | 40015 |
|  Barry Callebaut AG (Registered) | 38 |  | 71918 |
|  Bega Cheese Ltd.(a) | 22616 |  | 46422 |
|  Bell Food Group AG (Registered) | 820 |  | 199930 |
|  Bumitama Agri Ltd. | 213200 |  | 89643 |
|  Calbee, Inc. | 3200 |  | 64265 |
|  Chocoladefabriken Lindt & Spruengli AG | 24 |  | 230227 |
|  Chocoladefabriken Lindt & Spruengli AG (Registered) | 3 |  | 291681 |
|  Cloetta AB, Class B | 16456 |  | 30051 |
|  Costa Group Holdings Ltd.(a) | 16050 |  | 26068 |
|  Cranswick plc | 2058 |  | 70468 |
|  Danone SA | 8569 |  | 426338 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  DyDo Group Holdings, Inc. | 500 | $15272 |
|  Ebro Foods SA | 1618 | 25235 |
|  Elders Ltd.(a) | 12136 | 100885 |
|  Emmi AG (Registered) | 41 | 32734 |
|  First Pacific Co. Ltd. | 820000 | 217278 |
|  First Resources Ltd. | 5100 | 5370 |
|  Fuji Oil Holdings, Inc.(a) | 17600 | 277200 |
|  Glanbia plc(a) | 2024 | 23385 |
|  Golden Agri-Resources Ltd. | 213400 | 43733 |
|  Greencore Group plc\* | 148092 | 114239 |
|  Grieg Seafood ASA | 3299 | 22846 |
|  Hilton Food Group plc | 3916 | 27503 |
|  House Foods Group, Inc. | 2400 | 44937 |
|  Inghams Group Ltd.(a) | 105247 | 170270 |
|  Itoham Yonekyu Holdings, Inc. | 55400 | 247862 |
|  Japfa Ltd. | 201820 | 72736 |
|  JDE Peet's NV | 1804 | 51671 |
|  Kagome Co. Ltd. | 900 | 18008 |
|  Kameda Seika Co. Ltd. | 900 | 27823 |
|  Kernel Holding SA | 13728 | 47617 |
|  Kerry Group plc, Class A(a) | 2419 | 210392 |
|  Kewpie Corp. | 2100 | 33188 |
|  Kikkoman Corp. | 3500 | 190265 |
|  Kotobuki Spirits Co. Ltd. | 500 | 25667 |
|  KWS Saat SE & Co. KGaA | 704 | 40913 |
|  Leroy Seafood Group ASA | 5456 | 25084 |
|  Maple Leaf Foods, Inc. | 301 | 4455 |
|  Maruha Nichiro Corp.(a) | 16400 | 253004 |
|  Megmilk Snow Brand Co. Ltd. | 18400 | 200545 |
|  Mehadrin Ltd.\* | — (d) | 14 |
|  MEIJI Holdings Co. Ltd. | 2800 | 115289 |
|  Morinaga & Co. Ltd. | 1100 | 27531 |
|  Morinaga Milk Industry Co. Ltd. | 1200 | 34070 |
|  Mowi ASA | 5699 | 84990 |
|  Nestle SA (Registered) | 40262 | 4386878 |
|  Neto Malinda Trading Ltd.\* | 1596 | 53918 |
|  NH Foods Ltd. | 3200 | 76321 |
|  Nichirei Corp. | 1600 | 24909 |
|  Nippn Corp. | 26100 | 274811 |
|  Nippon Suisan Kaisha Ltd. | 94900 | 338393 |
|  Nisshin Oillio Group Ltd. (The) | 9300 | 199596 |
|  Nisshin Seifun Group, Inc. | 2690 | 29102 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 205

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Nissin Foods Holdings Co. Ltd. | 1500 | $| 97184 |
|  Norway Royal Salmon ASA\* | 132 |  | 1676 |
|  Orkla ASA | 12859 |  | 86775 |
|  Premier Foods plc | 206353 |  | 246138 |
|  Premium Brands Holdings Corp.(a) | 660 |  | 38887 |
|  Prima Meat Packers Ltd. | 8200 |  | 108517 |
|  Riken Vitamin Co. Ltd. | 10000 |  | 126821 |
|  S Foods, Inc. | 7200 |  | 132001 |
|  Sakata Seed Corp.(a) | 2800 |  | 92307 |
|  Salmar ASA | 748 |  | 25339 |
|  Saputo, Inc. | 4349 |  | 105724 |
|  Savencia SA | 1676 |  | 92928 |
|  Schouw & Co. A/S(a) | 420 |  | 26652 |
|  Societe LDC SA | 1617 |  | 149268 |
|  Strauss Group Ltd. | 952 |  | 23933 |
|  Suedzucker AG | 1979 |  | 25232 |
|  Synlait Milk Ltd.\* (a) | 1760 |  | 3190 |
|  Tate & Lyle plc | 9428 |  | 76093 |
|  Toyo Suisan Kaisha Ltd. | 1800 |  | 67575 |
|  UIE plc(a) | 4510 |  | 110766 |
|  United Malt Grp Ltd.(a) | 25168 |  | 50051 |
|  Vilmorin & Cie SA | 1612 |  | 71456 |
|  Viscofan SA | 1554 |  | 92538 |
|  Vitasoy International Holdings Ltd.\* (a) | 72000 |  | 122907 |
|  WH Group Ltd.(b) | 150500 |  | 76114 |
|  Wilmar International Ltd. | 69700 |  | 191107 |
|  Yakult Honsha Co. Ltd. | 2500 |  | 138595 |
|  Yamazaki Baking Co. Ltd.(a) | 2900 |  | 29559 |
|  |  |  | **12943444** |
| **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** |
|  AltaGas Ltd.(a) | 6337 |  | 114145 |
|  APA Group(a) | 15936 |  | 107100 |
|  Brookfield Infrastructure Corp., Class A(a) | 1055 |  | 45462 |
|  Enagas SA(a) | 2268 |  | 36818 |
|  Hong Kong & China Gas Co. Ltd. | 149907 |  | 115727 |
|  Italgas SpA | 6908 |  | 35605 |
|  Keppel Infrastructure Trust | 55647 |  | 20842 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Gas Utilities – (continued)** | **Gas Utilities – (continued)** | **Gas Utilities – (continued)** | **Gas Utilities – (continued)** |
|  Naturgy Energy Group SA(a) | 3936 | $| 100988 |
|  Nippon Gas Co. Ltd. | 6000 |  | 87234 |
|  Osaka Gas Co. Ltd. | 9500 |  | 140741 |
|  Rubis SCA | 30422 |  | 691554 |
|  Saibu Gas Holdings Co. Ltd. | 1400 |  | 16248 |
|  Shizuoka Gas Co. Ltd.(a) | 20500 |  | 150335 |
|  Snam SpA | 29438 |  | 130986 |
|  Superior Plus Corp.(a) | 10208 |  | 77530 |
|  Toho Gas Co. Ltd. | 2000 |  | 37340 |
|  Tokyo Gas Co. Ltd. | 8200 |  | 146583 |
|  |  |  | **2055238** |
| **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** |
|  Advanced Medical Solutions Group plc | 10648 |  | 33469 |
|  Alcon, Inc. | 7790 |  | 474367 |
|  Ambu A/S, Class B(a) | 3172 |  | 35524 |
|  Ansell Ltd.(a) | 2200 |  | 39714 |
|  Arjo AB, Class B | 4131 |  | 16471 |
|  Asahi Intecc Co. Ltd. | 3200 |  | 54555 |
|  BioMerieux | 825 |  | 73010 |
|  Carl Zeiss Meditec AG | 715 |  | 86602 |
|  Cellavision AB | 1320 |  | 24727 |
|  Cochlear Ltd. | 826 |  | 105484 |
|  Coloplast A/S, Class B | 1640 |  | 182886 |
|  ConvaTec Group plc(b) | 26224 |  | 65821 |
|  Demant A/S\* | 1980 |  | 54123 |
|  DiaSorin SpA | 293 |  | 38312 |
|  Eckert & Ziegler Strahlen- und Medizintechnik AG | 264 |  | 10447 |
|  Eiken Chemical Co. Ltd. | 1600 |  | 19785 |
|  El.En. SpA | 2684 |  | 32841 |
|  Elekta AB, Class B | 6069 |  | 30811 |
|  EssilorLuxottica SA | 1645 |  | 260703 |
|  EssilorLuxottica SA | 2578 |  | 408949 |
|  Fisher & Paykel Healthcare Corp. Ltd. | 10109 |  | 114990 |
|  Fukuda Denshi Co. Ltd. | 4100 |  | 214055 |
|  Getinge AB, Class B | 2980 |  | 60488 |
|  GN Store Nord A/S(a) | 2064 |  | 43897 |
|  Hogy Medical Co. Ltd. | 1200 |  | 26642 |
|  Hoya Corp. | 5100 |  | 476082 |
|  Japan Lifeline Co. Ltd. | 23500 |  | 158738 |

---

*See Accompanying Notes to the Financial Statements.* 

206 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Jeol Ltd. | 1100 | $| 40408 |
|  Koninklijke Philips NV | 14293 |  | 181073 |
|  Mani, Inc. | 4200 |  | 61318 |
|  Medacta Group SA(b) | 336 |  | 30251 |
|  Medistim ASA | 1188 |  | 27538 |
|  Menicon Co. Ltd. | 1900 |  | 32558 |
|  Nagaileben Co. Ltd. | 1500 |  | 20608 |
|  Nakanishi, Inc. | 4200 |  | 76746 |
|  Nanosonics Ltd.\* (a) | 16777 |  | 44092 |
|  Nihon Kohden Corp. | 2300 |  | 51606 |
|  Nipro Corp. | 46100 |  | 347995 |
|  Olympus Corp. | 20500 |  | 433074 |
|  Paramount Bed Holdings Co. Ltd. | 1600 |  | 28505 |
|  PHC Holdings Corp.(a) | 8400 |  | 87258 |
|  PolyNovo Ltd.\* (a) | 32604 |  | 41697 |
|  Revenio Group OYJ | 924 |  | 34392 |
|  Siemens Healthineers AG(b) | 4715 |  | 217066 |
|  Smith & Nephew plc | 14391 |  | 170662 |
|  Sonova Holding AG (Registered) | 785 |  | 185670 |
|  STRATEC SE | 308 |  | 25845 |
|  Straumann Holding AG (Registered) | 1826 |  | 174033 |
|  Surgical Science Sweden AB\* (a) | 1584 |  | 22834 |
|  Sysmex Corp. | 2700 |  | 145831 |
|  Terumo Corp. | 12200 |  | 371331 |
|  Xvivo Perfusion AB\* | 1892 |  | 27189 |
|  Ypsomed Holding AG (Registered) | 81 |  | 13047 |
|  |  |  | **6036120** |
| **Health Care Providers & Services – 0.5%** | **Health Care Providers & Services – 0.5%** | **Health Care Providers & Services – 0.5%** | **Health Care Providers & Services – 0.5%** |
|  Alfresa Holdings Corp. | 5500 |  | 63313 |
|  Amplifon SpA(a) | 2112 |  | 52477 |
|  Arvida Group Ltd.(a) | 34325 |  | 25126 |
|  As One Corp. | 800 |  | 34231 |
|  BML, Inc.(a) | 1900 |  | 43015 |
|  Chartwell Retirement Residences(a) | 5472 |  | 31692 |
|  China Evergrande New Energy Vehicle Group Ltd.\* ‡ | 40000 |  |  |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  CVS Group plc | 4356 | $| 94839 |
|  dentalcorp Holdings Ltd.\* | 3652 |  | 20321 |
|  EBOS Group Ltd.(a) | 2041 |  | 44464 |
|  Fagron | 2504 |  | 31183 |
|  Fresenius Medical Care AG & Co. KGaA | 2394 |  | 66204 |
|  Fresenius SE & Co. KGaA | 9061 |  | 208662 |
|  Galenica AG(b) | 792 |  | 56902 |
|  H.U. Group Holdings, Inc. | 20500 |  | 382043 |
|  Healius Ltd. | 14608 |  | 32040 |
|  Ilex Medical Ltd.(a) | 1008 |  | 25576 |
|  Integral Diagnostics Ltd.(a) | 13068 |  | 21977 |
|  Korian SA | 2730 |  | 25795 |
|  Mediclinic International plc | 11132 |  | 63571 |
|  Medicover AB, Class B | 1320 |  | 16341 |
|  Medipal Holdings Corp. | 5100 |  | 63306 |
|  Mediterranean Towers Ltd.(a) | 15498 |  | 45047 |
|  NMC Health plc\* | 2074 |  | 62 |
|  Oceania Healthcare Ltd. | 49437 |  | 24700 |
|  Orpea SA\* (a) | 16605 |  | 134772 |
|  Raffles Medical Group Ltd. | 4124 |  | 3876 |
|  Ramsay Health Care Ltd. | 2952 |  | 110560 |
|  Ryman Healthcare Ltd. | 8272 |  | 40271 |
|  Ship Healthcare Holdings, Inc. | 6000 |  | 115087 |
|  Solasto Corp. | 4400 |  | 26554 |
|  Sonic Healthcare Ltd. | 7462 |  | 156365 |
|  Spire Healthcare Group plc\* (b) | 14036 |  | 35068 |
|  Summerset Group Holdings Ltd. | 6710 |  | 37734 |
|  Suzuken Co. Ltd. | 1880 |  | 41866 |
|  Toho Holdings Co. Ltd. | 4200 |  | 57136 |
|  Uniphar plc | 9064 |  | 31354 |
|  |  |  | **2263530** |
| **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** | **Health Care Technology – 0.1%** |
|  CompuGroup Medical SE & Co. KGaA | 624 |  | 19735 |
|  Craneware plc | 1936 |  | 41237 |
|  EMIS Group plc | 2728 |  | 58358 |
|  M3, Inc. | 6500 |  | 194429 |
|  Pro Medicus Ltd.(a) | 1100 |  | 39264 |
|  Sectra AB, Class B\* | 2948 |  | 39056 |
|  |  |  | **392079** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 207

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** |
|  888 Holdings plc\* | 100163 | $107019 |
|  Accor SA\* | 2133 | 51102 |
|  AmRest Holdings SE\* | 11802 | 45513 |
|  Arcland Service Holdings Co. Ltd. | 1400 | 20543 |
|  Aristocrat Leisure Ltd. | 10373 | 245886 |
|  Atom Corp.(a) | 5800 | 30827 |
|  Autogrill SpA\* | 902 | 5643 |
|  Basic-Fit NV\* (a) (b) | 2058 | 51868 |
|  Betsson AB, Class B\* | 42886 | 312027 |
|  Cafe de Coral Holdings Ltd. | 38000 | 44342 |
|  Carnival plc\* | 4488 | 35974 |
|  Collins Foods Ltd.(a) | 6204 | 37291 |
|  Colowide Co. Ltd.(a) | 3500 | 42974 |
|  Compass Group plc | 24682 | 521890 |
|  Corporate Travel Management Ltd.(a) | 3366 | 37602 |
|  Create Restaurants Holdings, Inc. | 4400 | 27797 |
|  Dalata Hotel Group plc\* (a) | 18392 | 58987 |
|  Domino's Pizza Enterprises Ltd.(a) | 1398 | 56989 |
|  Domino's Pizza Group plc | 24948 | 64973 |
|  Entain plc | 9553 | 138915 |
|  Evolution AB(a) (b) | 2829 | 264456 |
|  Flight Centre Travel Group Ltd.\* (a) | 4576 | 48720 |
|  Flutter Entertainment plc\* | 2333 | 310222 |
|  Food & Life Cos. Ltd. | 2000 | 33761 |
|  Fuji Kyuko Co. Ltd.(a) | 1000 | 30948 |
|  Galaxy Entertainment Group Ltd. | 36000 | 164411 |
|  Genting Singapore Ltd. | 104400 | 59389 |
|  Greggs plc | 2464 | 57249 |
|  Heiwa Corp. | 2450 | 39560 |
|  HIS Co. Ltd.\* (a) | 4400 | 60952 |
|  Hongkong & Shanghai Hotels Ltd. (The)\* (a) | 66000 | 51624 |
|  Ichibanya Co. Ltd.(a) | 1000 | 30881 |
|  Imperial Hotel Ltd. | 2700 | 35077 |
|  InterContinental Hotels Group plc | 2419 | 130789 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  J D Wetherspoon plc\* | 3795 | $19706 |
|  Jumbo Interactive Ltd.(a) | 3476 | 30318 |
|  Kindred Group plc, SDR | 7392 | 64218 |
|  KOMEDA Holdings Co. Ltd. | 1200 | 20046 |
|  Kura Sushi, Inc. | 1400 | 32778 |
|  Kyoritsu Maintenance Co. Ltd.(a) | 1600 | 65987 |
|  La Francaise des Jeux SAEM(b) | 1364 | 44488 |
|  Mandarin Oriental International Ltd.\* | 8000 | 13200 |
|  McDonald's Holdings Co. Japan Ltd. | 1100 | 38188 |
|  Melco International Development Ltd.\* (a) | 21000 | 10968 |
|  Melia Hotels International SA\* | 9988 | 46397 |
|  MGM China Holdings Ltd.\* (a) | 32400 | 13043 |
|  Mitchells & Butlers plc\* | 22924 | 30669 |
|  MOS Food Services, Inc.(a) | 2100 | 44576 |
|  MTY Food Group, Inc. | 1452 | 58780 |
|  Ohsho Food Service Corp. | 704 | 30029 |
|  Oriental Land Co. Ltd. | 3300 | 442931 |
|  Playtech plc\* | 13608 | 81315 |
|  Plenus Co. Ltd. | 1000 | 17728 |
|  Resorttrust, Inc. | 4200 | 64709 |
|  Restaurant Brands International, Inc. | 4469 | 265214 |
|  Restaurant Brands New Zealand Ltd.(a) | 1154 | 4794 |
|  Round One Corp. | 15300 | 65159 |
|  Royal Holdings Co. Ltd.\* | 1600 | 25598 |
|  Saizeriya Co. Ltd. | 1800 | 33618 |
|  Sands China Ltd.\* | 40400 | 70508 |
|  Scandic Hotels Group AB\* (a) (b) | 9870 | 31288 |
|  Shangri-La Asia Ltd.\* | 32000 | 17692 |
|  SJM Holdings Ltd.\* (a) | 76000 | 23720 |
|  SkiStar AB | 2828 | 27050 |
|  Skylark Holdings Co. Ltd. | 3700 | 39506 |
|  Sodexo SA | 1394 | 123640 |
|  SSP Group plc\* | 20152 | 46938 |
|  Star Entertainment Grp Ltd. (The)\* (a) | 11421 | 21471 |
|  Tabcorp Holdings Ltd.(a) | 42592 | 26282 |
|  Tokyotokeiba Co. Ltd. | 1200 | 33465 |

---

*See Accompanying Notes to the Financial Statements.* 

208 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Toridoll Holdings Corp. | 1100 | $| 21388 |
|  Trainline plc\* (b) | 33203 |  | 127186 |
|  TUI AG\* | 28116 |  | 42665 |
|  Webjet Ltd.\* (a) | 12894 |  | 43534 |
|  Whitbread plc | 2508 |  | 74269 |
|  Wynn Macau Ltd.\* | 12800 |  | 5104 |
|  Yoshinoya Holdings Co. Ltd.(a) | 4900 |  | 77076 |
|  Zensho Holdings Co. Ltd.(a) | 1800 |  | 44929 |
|  |  |  | **5718369** |
| **Household Durables – 1.1%** | **Household Durables – 1.1%** | **Household Durables – 1.1%** | **Household Durables – 1.1%** |
|  Ariston Holding NV | 3402 |  | 29017 |
|  Azorim-Investment Development & Construction Co. Ltd.(a) | 4285 |  | 14988 |
|  Barratt Developments plc | 22673 |  | 98205 |
|  Bellway plc | 2640 |  | 56384 |
|  Berkeley Group Holdings plc | 2068 |  | 82644 |
|  Bonava AB, Class B | 30184 |  | 88281 |
|  Breville Group Ltd.(a) | 2420 |  | 30717 |
|  Cairn Homes plc | 38456 |  | 37236 |
|  Casio Computer Co. Ltd. | 3600 |  | 31341 |
|  Countryside Partnerships plc\* (a) (b) | 23352 |  | 57160 |
|  Crest Nicholson Holdings plc | 88642 |  | 206157 |
|  Danya Cebus Ltd.(a) | 1638 |  | 39234 |
|  De' Longhi SpA(a) | 1012 |  | 17474 |
|  Dom Development SA | 2244 |  | 39694 |
|  Electra Consumer Products 1970 Ltd.(a) | 1386 |  | 48241 |
|  Electrolux AB, Class B(a) | 6909 |  | 85193 |
|  Fiskars OYJ Abp | 574 |  | 8271 |
|  Focusrite plc(a) | 2156 |  | 16632 |
|  Forbo Holding AG (Registered) | 82 |  | 99310 |
|  Fujitsu General Ltd. | 2100 |  | 48037 |
|  Glenveagh Properties plc\* (b) | 34100 |  | 33366 |
|  Haseko Corp. | 3500 |  | 36075 |
|  Iida Group Holdings Co. Ltd. | 5400 |  | 75059 |
|  JM AB | 1842 |  | 27737 |
|  JS Global Lifestyle Co. Ltd.(b) | 22000 |  | 17712 |
|  Ki-Star Real Estate Co. Ltd.(a) | 3300 |  | 102795 |
|  Man Wah Holdings Ltd. | 19200 |  | 10713 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** |
|  Nagawa Co. Ltd. | 500 | $| 24994 |
|  Neinor Homes SA(b) | 5964 |  | 47569 |
|  Nikon Corp. | 5800 |  | 56152 |
|  Nobia AB(a) | 49733 |  | 82855 |
|  Open House Group Co. Ltd. | 1800 |  | 64184 |
|  Panasonic Holdings Corp. | 49200 |  | 352363 |
|  Persimmon plc | 6929 |  | 104109 |
|  Pressance Corp.(a) | 8400 |  | 86354 |
|  Redrow plc | 10340 |  | 49834 |
|  Rinnai Corp. | 600 |  | 40933 |
|  Sangetsu Corp. | 2256 |  | 23921 |
|  SEB SA | 616 |  | 40122 |
|  Sekisui Chemical Co. Ltd. | 10500 |  | 131396 |
|  Sekisui House Ltd. | 16000 |  | 266425 |
|  Sharp Corp.(a) | 6200 |  | 37166 |
|  Sony Group Corp. | 18300 |  | 1229727 |
|  Sumitomo Forestry Co. Ltd. | 3300 |  | 51731 |
|  Tama Home Co. Ltd.(a) | 4400 |  | 69122 |
|  Taylor Wimpey plc | 81549 |  | 88051 |
|  Token Corp. | 2600 |  | 137316 |
|  Victoria plc\* (a) | 5192 |  | 30128 |
|  Videndum plc | 2376 |  | 35180 |
|  Vistry Group plc | 7172 |  | 49793 |
|  YIT OYJ(a) | 63747 |  | 159905 |
|  Zojirushi Corp. | 1300 |  | 13128 |
|  |  |  | **4710131** |
| **Household Products – 0.3%** | **Household Products – 0.3%** | **Household Products – 0.3%** | **Household Products – 0.3%** |
|  Earth Corp. | 600 |  | 20789 |
|  Essity AB, Class A | 616 |  | 12933 |
|  Essity AB, Class B | 8938 |  | 188782 |
|  Henkel AG & Co. KGaA | 1650 |  | 96950 |
|  Henkel AG & Co. KGaA (Preference) | 2870 |  | 180916 |
|  Lion Corp. | 6800 |  | 68807 |
|  Pigeon Corp. | 2400 |  | 31454 |
|  Reckitt Benckiser Group plc | 11234 |  | 747601 |
|  Sano-Brunos Enterprises Ltd.(a) | 308 |  | 21309 |
|  Unicharm Corp. | 5600 |  | 170749 |
|  |  |  | **1540290** |
| **Independent Power and Renewable Electricity<br>Producers – 0.3%** | **Independent Power and Renewable Electricity<br>Producers – 0.3%** | **Independent Power and Renewable Electricity<br>Producers – 0.3%** | **Independent Power and Renewable Electricity<br>Producers – 0.3%** |
|  Boralex, Inc., Class A | 2081 |  | 58934 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 209

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** |
|  Brookfield Renewable Corp. | 2068 | $| 64176 |
|  Capital Power Corp. | 2535 |  | 84745 |
|  ContourGlobal plc(b) | 17776 |  | 51780 |
|  Corp. ACCIONA Energias Renovables SA | 1276 |  | 50143 |
|  Doral Group Renewable Energy Resources Ltd.\* (a) | 2244 |  | 6905 |
|  Drax Group plc | 12710 |  | 76241 |
|  EDP Renovaveis SA | 3895 |  | 82036 |
|  Electric Power Development Co. Ltd. | 3100 |  | 43131 |
|  Encavis AG | 3528 |  | 65728 |
|  Enlight Renewable Energy Ltd.\* | 14280 |  | 29071 |
|  eRex Co. Ltd. | 2700 |  | 45831 |
|  ERG SpA | 704 |  | 22085 |
|  Greenvolt-Energias Renovaveis SA\* | 4875 |  | 37486 |
|  Innergex Renewable Energy, Inc. | 559 |  | 6147 |
|  Meridian Energy Ltd. | 28875 |  | 81862 |
|  Neoen SA(a) (b) | 1147 |  | 40040 |
|  Northland Power, Inc. | 3566 |  | 103630 |
|  Orron Energy ab | 3982 |  | 8266 |
|  RENOVA, Inc.\* | 1000 |  | 22000 |
|  RWE AG | 10086 |  | 388672 |
|  Scatec ASA(a) (b) | 988 |  | 6994 |
|  Solaria Energia y Medio Ambiente SA\* | 4811 |  | 76079 |
|  TransAlta Corp.(a) | 3906 |  | 34362 |
|  Uniper SE | 2028 |  | 6077 |
|  Voltalia SA (Registered)\* | 2112 |  | 40245 |
|  |  |  | **1532666** |
| **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** |
|  Aker ASA, Class A(a) | 264 |  | 18600 |
|  Bonheur ASA | 336 |  | 9550 |
|  Brookfield Business Corp., Class A(a) | 7790 |  | 199997 |
|  CK Hutchison Holdings Ltd. | 61356 |  | 304832 |
|  DCC plc | 2132 |  | 118806 |
|  Hitachi Ltd. | 19800 |  | 900515 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** |
|  Investment AB Latour, Class B | 2024 | $| 34205 |
|  Italmobiliare SpA | 245 |  | 6260 |
|  Jardine Cycle & Carriage Ltd. | 3600 |  | 75658 |
|  Jardine Matheson Holdings Ltd. | 5800 |  | 266916 |
|  Keihan Holdings Co. Ltd. | 2500 |  | 64335 |
|  Keppel Corp. Ltd. | 28700 |  | 141360 |
|  Lifco AB, Class B | 4576 |  | 66070 |
|  Melrose Industries plc | 69892 |  | 94070 |
|  Nisshinbo Holdings, Inc. | 52600 |  | 365211 |
|  Nolato AB, Class B | 3080 |  | 12988 |
|  Noritsu Koki Co. Ltd.(a) | 5000 |  | 90154 |
|  NWS Holdings Ltd. | 44000 |  | 31221 |
|  Siemens AG (Registered) | 10660 |  | 1165682 |
|  Smiths Group plc | 5370 |  | 96482 |
|  Storskogen Group AB, Class B | 7392 |  | 5409 |
|  TOKAI Holdings Corp.(a) | 43795 |  | 261647 |
|  Toshiba Corp. | 5700 |  | 198686 |
|  |  |  | **4528654** |
| **Insurance – 4.0%** | **Insurance – 4.0%** | **Insurance – 4.0%** | **Insurance – 4.0%** |
|  Admiral Group plc | 4387 |  | 101878 |
|  Aegon NV(a) | 25335 |  | 117312 |
|  Ageas SA/NV | 4346 |  | 150467 |
|  AIA Group Ltd. | 179200 |  | 1357152 |
|  Allianz SE (Registered) | 8446 |  | 1520933 |
|  Alm Brand A/S | 57708 |  | 78910 |
|  ASR Nederland NV | 3374 |  | 148694 |
|  Assicurazioni Generali SpA | 25092 |  | 376707 |
|  AUB Group Ltd.(a) | 5876 |  | 77703 |
|  Aviva plc | 60639 |  | 291904 |
|  AXA SA | 40303 |  | 995837 |
|  Baloise Holding AG (Registered) | 984 |  | 134510 |
|  Beazley plc | 13573 |  | 97592 |
|  Clal Insurance Enterprises Holdings Ltd.\* (a) | 2684 |  | 46527 |
|  Coface SA | 36818 |  | 410105 |
|  Conduit Holdings Ltd. | 47888 |  | 184981 |
|  Dai-ichi Life Holdings, Inc. | 20600 |  | 326737 |
|  Direct Line Insurance Group plc | 22704 |  | 52751 |
|  Fairfax Financial Holdings Ltd. | 533 |  | 261446 |
|  Gjensidige Forsikring ASA | 2860 |  | 52238 |
|  Great Eastern Holdings Ltd. | 2400 |  | 30358 |

---

*See Accompanying Notes to the Financial Statements.* 

210 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Great-West Lifeco, Inc. | 5912 | $136699 |
|  Grupo Catalana Occidente SA | 704 | 19134 |
|  Hannover Rueck SE | 1148 | 186986 |
|  Harel Insurance Investments & Financial Services Ltd. | 3957 | 38271 |
|  Helvetia Holding AG (Registered) | 880 | 87406 |
|  Hiscox Ltd. | 5060 | 52386 |
|  iA Financial Corp., Inc. | 2829 | 157248 |
|  IDI Insurance Co. Ltd.(a) | 3036 | 81164 |
|  Insurance Australia Group Ltd.(a) | 40754 | 127695 |
|  Intact Financial Corp. | 2624 | 398222 |
|  Japan Post Holdings Co. Ltd. | 48000 | 322810 |
|  Japan Post Insurance Co. Ltd. | 4400 | 65037 |
|  Just Group plc | 304425 | 203290 |
|  Lancashire Holdings Ltd. | 78966 | 450223 |
|  Legal & General Group plc | 128002 | 343237 |
|  Linea Directa Aseguradora SA Cia de Seguros y Reaseguros | 40084 | 37577 |
|  Manulife Financial Corp. | 40836 | 675985 |
|  Mapfre SA | 22440 | 38480 |
|  Medibank Pvt Ltd. | 48899 | 87864 |
|  Menora Mivtachim Holdings Ltd.\* | 1761 | 36026 |
|  Migdal Insurance & Financial Holdings Ltd.\* | 26952 | 32462 |
|  MS&AD Insurance Group Holdings, Inc. | 9600 | 254540 |
|  Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | 2952 | 780169 |
|  nib holdings Ltd. | 11260 | 48025 |
|  NN Group NV | 7184 | 304248 |
|  Phoenix Group Holdings plc | 15047 | 93967 |
|  Phoenix Holdings Ltd. (The) | 5085 | 55351 |
|  Poste Italiane SpA(b) | 11425 | 99595 |
|  Power Corp. of Canada | 12063 | 299176 |
|  Powszechny Zaklad Ubezpieczen SA | 9856 | 55360 |
|  Protector Forsikring ASA | 4092 | 48725 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Prudential plc | 40631 | $| 379296 |
|  PSC Insurance Group Ltd. | 14212 |  | 43622 |
|  QBE Insurance Group Ltd.(a) | 30996 |  | 242602 |
|  Sampo OYJ, Class A | 6437 |  | 294434 |
|  SCOR SE | 3124 |  | 47009 |
|  Sompo Holdings, Inc. | 6700 |  | 279161 |
|  Steadfast Group Ltd. | 17908 |  | 57943 |
|  Storebrand ASA | 12259 |  | 95272 |
|  Sun Life Financial, Inc. | 12546 |  | 532174 |
|  Suncorp Group Ltd. | 24108 |  | 175895 |
|  Swiss Life Holding AG (Registered) | 656 |  | 317856 |
|  Swiss Re AG | 6273 |  | 466361 |
|  T&D Holdings, Inc. | 12300 |  | 121399 |
|  Talanx AG | 968 |  | 36375 |
|  Tokio Marine Holdings, Inc. | 41300 |  | 747726 |
|  Topdanmark A/S | 880 |  | 40655 |
|  Trisura Group Ltd.\* | 2200 |  | 63917 |
|  Tryg A/S | 5002 |  | 108274 |
|  Unipol Gruppo SpA | 6080 |  | 26176 |
|  UnipolSai Assicurazioni SpA(a) | 11528 |  | 26000 |
|  Wuestenrot & Wuerttembergische AG | 7216 |  | 101844 |
|  Zurich Insurance Group AG | 3116 |  | 1330469 |
|  |  |  | **17966560** |
| **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** |
|  Adevinta ASA\* | 6732 |  | 46102 |
|  Auto Trader Group plc(b) | 14842 |  | 89133 |
|  Baltic Classifieds Group plc | 16280 |  | 26092 |
|  Better Collective A/S\* (a) | 2464 |  | 31997 |
|  carsales.com Ltd.(a) | 6387 |  | 82990 |
|  Hemnet Group AB | 6720 |  | 83434 |
|  Infocom Corp. | 1600 |  | 23004 |
|  Kakaku.com, Inc. | 1600 |  | 27138 |
|  Karnov Group AB\* | 5418 |  | 28878 |
|  Moneysupermarket.com Group plc | 22168 |  | 46809 |
|  New Work SE | 159 |  | 19926 |
|  REA Group Ltd.(a) | 1056 |  | 82105 |
|  Rightmove plc | 13244 |  | 74992 |
|  Scout24 SE(b) | 1232 |  | 63172 |
|  SEEK Ltd.(a) | 5397 |  | 74510 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 211

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** |
|  Wirtualna Polska Holding SA(b) | 1936 | $| 37654 |
|  Z Holdings Corp. | 27200 |  | 70381 |
|  |  |  | **908317** |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  Allegro.eu SA\* (b) | 3080 |  | 14976 |
|  ASKUL Corp. | 1000 |  | 10462 |
|  ASOS plc\* (a) | 6300 |  | 40873 |
|  Auction Technology Group plc\* | 4356 |  | 37464 |
|  Belluna Co. Ltd. | 15600 |  | 75253 |
|  BHG Group AB\* | 7216 |  | 12094 |
|  boohoo Group plc\* | 15511 |  | 7249 |
|  Boozt AB\* (a) (b) | 2508 |  | 18293 |
|  Delivery Hero SE\* (b) | 4264 |  | 140548 |
|  Demae-Can Co. Ltd.\* (a) | 8800 |  | 28774 |
|  Dustin Group AB(a) (b) | 3680 |  | 15319 |
|  Just Eat Takeaway.com NV\* (b) | 1936 |  | 33265 |
|  Mercari, Inc.\* | 1900 |  | 31638 |
|  Prosus NV\* | 18450 |  | 803072 |
|  Rakuten Group, Inc.(a) | 15800 |  | 70796 |
|  Takkt AG | 2728 |  | 35320 |
|  Temple & Webster Group Ltd.\* (a) | 7304 |  | 26155 |
|  THG plc\* (a) | 50904 |  | 31180 |
|  Zalando SE\* (b) | 938 |  | 21629 |
|  Zalando SE\* (b) | 1750 |  | 40352 |
|  ZOZO, Inc. | 2800 |  | 59622 |
|  |  |  | **1554334** |
| **IT Services – 1.5%** | **IT Services – 1.5%** | **IT Services – 1.5%** | **IT Services – 1.5%** |
|  Addnode Group AB | 38991 |  | 339437 |
|  Adesso SE | 220 |  | 21787 |
|  Adyen NV\* (b) | 451 |  | 647490 |
|  Alten SA | 616 |  | 72024 |
|  Amadeus IT Group SA\* | 6027 |  | 314161 |
|  Appen Ltd.(a) | 2420 |  | 3931 |
|  Atea ASA\* | 2420 |  | 26907 |
|  Atos SE\* (a) | 968 |  | 9452 |
|  Bechtle AG | 1364 |  | 47184 |
|  Bell System24 Holdings, Inc. | 13500 |  | 125613 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  BIPROGY, Inc. | 1100 | $23793 |
|  Bouvet ASA | 5764 | 30492 |
|  CANCOM SE | 1981 | 49026 |
|  Capgemini SE | 2378 | 390737 |
|  CGI, Inc.\* | 3239 | 260583 |
|  Change, Inc.(a) | 3500 | 46907 |
|  Computacenter plc | 1092 | 22757 |
|  Computershare Ltd. | 8897 | 143766 |
|  Comture Corp.(a) | 2300 | 37509 |
|  Converge Technology Solutions Corp.\* (a) | 11792 | 48238 |
|  Data#3 Ltd.(a) | 12760 | 56300 |
|  Digital Garage, Inc. | 1300 | 31224 |
|  DTS Corp. | 2100 | 50015 |
|  Econocom Group SA/NV | 29084 | 79193 |
|  Edenred | 4059 | 208449 |
|  FDM Group Holdings plc | 3850 | 27970 |
|  Formula Systems 1985 Ltd. | 389 | 31721 |
|  Fujitsu Ltd. | 2600 | 299559 |
|  Future Corp. | 3400 | 38270 |
|  GFT Technologies SE | 924 | 30183 |
|  GMO internet group, Inc. | 1200 | 20757 |
|  GMO Payment Gateway, Inc. | 1000 | 72190 |
|  Indra Sistemas SA(a) | 9988 | 89338 |
|  Infomart Corp. | 5300 | 17223 |
|  Itochu Techno-Solutions Corp. | 2400 | 55707 |
|  Kainos Group plc | 2604 | 37087 |
|  Keywords Studios plc | 3066 | 85074 |
|  KNOW IT AB | 1144 | 22755 |
|  Kontron AG | 3168 | 45871 |
|  Matrix IT Ltd. | 924 | 20024 |
|  Megaport Ltd.\* (a) | 3960 | 15421 |
|  NCC Group plc | 23672 | 54237 |
|  NEC Corp. | 3300 | 109345 |
|  NEC Networks & System Integration Corp. | 2400 | 25738 |
|  NET One Systems Co. Ltd. | 2300 | 47351 |
|  Network International Holdings plc\* (b) | 14574 | 54534 |
|  Nexi SpA\* (b) | 15170 | 131491 |
|  NEXTDC Ltd.\* (a) | 10736 | 57118 |
|  Nomura Research Institute Ltd. | 6445 | 143309 |
|  NS Solutions Corp. | 800 | 18434 |

---

*See Accompanying Notes to the Financial Statements.* 

212 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  NSD Co. Ltd. | 4200 | $| 71886 |
|  NTT Data Corp. | 9800 |  | 142218 |
|  Nuvei Corp.\* (b) | 836 |  | 25128 |
|  Obic Co. Ltd. | 700 |  | 105352 |
|  One Software Technologies Ltd. | 3388 |  | 47121 |
|  Otsuka Corp. | 2500 |  | 78969 |
|  Pushpay Holdings Ltd.\* (a) | 37926 |  | 27541 |
|  Reply SpA | 484 |  | 52668 |
|  SCSK Corp. | 2700 |  | 39909 |
|  SHIFT, Inc.\* | 300 |  | 47048 |
|  Shopify, Inc., Class A\* | 17220 |  | 589675 |
|  Softcat plc | 2288 |  | 29504 |
|  Sopra Steria Group SACA | 396 |  | 52446 |
|  SUNeVision Holdings Ltd. | 90000 |  | 47695 |
|  TechMatrix Corp. | 3300 |  | 37610 |
|  TELUS International CDA, Inc.\* | 4639 |  | 115121 |
|  TietoEVRY OYJ | 1598 |  | 38126 |
|  TIS, Inc. | 4600 |  | 124257 |
|  Transcosmos, Inc. | 8200 |  | 188953 |
|  Tyro Payments Ltd.\* (a) | 8888 |  | 8696 |
|  Wise plc, Class A\* | 9328 |  | 71420 |
|  Worldline SA\* (b) | 4346 |  | 190371 |
|  |  |  | **6769396** |
| **Leisure Products – 0.3%** | **Leisure Products – 0.3%** | **Leisure Products – 0.3%** | **Leisure Products – 0.3%** |
|  Bandai Namco Holdings, Inc. | 2900 |  | 192026 |
|  Beneteau SA | 9512 |  | 105481 |
|  BRP, Inc.(a) | 639 |  | 42672 |
|  Games Workshop Group plc | 684 |  | 50402 |
|  Harvia OYJ(b) | 748 |  | 10616 |
|  MIPS AB(b) | 440 |  | 14231 |
|  Sega Sammy Holdings, Inc. | 2600 |  | 33323 |
|  Shimano, Inc. | 1100 |  | 170771 |
|  Snow Peak, Inc.(a) | 1600 |  | 21120 |
|  Spin Master Corp.(b) | 1936 |  | 59753 |
|  Technogym SpA(b) | 4905 |  | 33741 |
|  Thule Group AB(b) | 2024 |  | 39856 |
|  Tomy Co. Ltd.(a) | 25100 |  | 220544 |
|  Universal Entertainment Corp.\* | 300 |  | 4057 |
|  Yamaha Corp. | 1700 |  | 64278 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Leisure Products – (continued)** | **Leisure Products – (continued)** | **Leisure Products – (continued)** | **Leisure Products – (continued)** |
|  Yonex Co. Ltd. | 5600 | $| 52106 |
|  |  |  | **1114977** |
| **Life Sciences Tools & Services – 0.4%** | **Life Sciences Tools & Services – 0.4%** | **Life Sciences Tools & Services – 0.4%** | **Life Sciences Tools & Services – 0.4%** |
|  AddLife AB, Class B | 1496 |  | 13971 |
|  Bachem Holding AG, Class B(a) | 440 |  | 31590 |
|  Biotage AB | 1890 |  | 30991 |
|  Chemometec A/S\* | 572 |  | 53953 |
|  Ergomed plc\* | 2420 |  | 34160 |
|  Eurofins Scientific SE(a) | 2050 |  | 131252 |
|  Evotec SE\* | 3042 |  | 58072 |
|  Gerresheimer AG | 1260 |  | 72229 |
|  Lonza Group AG (Registered) | 1148 |  | 591236 |
|  Oxford Nanopore Technologies plc\* | 5808 |  | 17553 |
|  QIAGEN NV\* | 4369 |  | 190314 |
|  Sartorius AG (Preference) | 410 |  | 144705 |
|  Sartorius Stedim Biotech | 328 |  | 104126 |
|  Siegfried Holding AG (Registered)\* | 88 |  | 52409 |
|  Tecan Group AG (Registered) | 220 |  | 80767 |
|  Wuxi Biologics Cayman, Inc.\* (b) | 57500 |  | 260037 |
|  |  |  | **1867365** |
| **Machinery – 3.3%** | **Machinery – 3.3%** | **Machinery – 3.3%** | **Machinery – 3.3%** |
|  Aalberts NV | 1454 |  | 50556 |
|  Alfa Laval AB | 4920 |  | 121147 |
|  Alstom SA | 4577 |  | 94364 |
|  Amada Co. Ltd. | 7200 |  | 50718 |
|  ANDRITZ AG | 2081 |  | 96791 |
|  Atlas Copco AB, Class A(a) | 51004 |  | 544821 |
|  Atlas Copco AB, Class B | 29561 |  | 286075 |
|  ATS Automation Tooling Systems, Inc.\* | 1980 |  | 62562 |
|  Beijer Alma AB | 2304 |  | 32192 |
|  Bobst Group SA (Registered) | 528 |  | 32448 |
|  Bodycote plc | 11283 |  | 64382 |
|  Bucher Industries AG (Registered) | 176 |  | 59338 |
|  Burckhardt Compression Holding AG | 132 |  | 57113 |
|  Bystronic AG | 55 |  | 31601 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 213

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Cargotec OYJ, Class B(a) | 684 | $25743 |
|  CKD Corp. | 23000 | 282713 |
|  CNH Industrial NV | 16974 | 219853 |
|  Concentric AB | 2420 | 40032 |
|  Construcciones y Auxiliar de Ferrocarriles SA | 5166 | 134794 |
|  Daetwyler Holding AG | 176 | 31269 |
|  Daifuku Co. Ltd. | 2300 | 105534 |
|  Daimler Truck Holding AG\* | 12505 | 333702 |
|  Danieli & C Officine Meccaniche SpA(a) | 2310 | 47146 |
|  Danieli & C Officine Meccaniche SpA (Retirement Savings Plan) | 11193 | 153770 |
|  DMG Mori Co. Ltd.(a) | 43100 | 500202 |
|  Duerr AG | 14842 | 392838 |
|  Ebara Corp. | 2600 | 84751 |
|  Electrolux Professional AB, Class B | 4532 | 17102 |
|  Epiroc AB, Class A | 9440 | 144413 |
|  Epiroc AB, Class B | 7339 | 98525 |
|  FANUC Corp. | 3100 | 409412 |
|  Fincantieri SpA\* (a) | 198567 | 100973 |
|  FLSmidth & Co. A/S | 3696 | 85499 |
|  Fluidra SA | 912 | 12376 |
|  Fuji Corp. | 33800 | 447528 |
|  Fujitec Co. Ltd. | 2400 | 47763 |
|  Fukushima Galilei Co. Ltd. | 4100 | 112958 |
|  GEA Group AG | 3034 | 106152 |
|  Georg Fischer AG (Registered) | 1554 | 86105 |
|  Giken Ltd. | 1200 | 25916 |
|  Glory Ltd.(a) | 20600 | 318074 |
|  Harmonic Drive Systems, Inc.(a) | 1500 | 50156 |
|  Hino Motors Ltd. | 10300 | 42826 |
|  Hitachi Construction Machinery Co. Ltd. | 2800 | 54894 |
|  Hitachi Zosen Corp. | 12400 | 71663 |
|  Hoshizaki Corp. | 2400 | 68867 |
|  Husqvarna AB, Class B | 7480 | 44404 |
|  IHI Corp. | 2500 | 55841 |
|  IMI plc | 3784 | 53500 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Indutrade AB | 5016 | $87765 |
|  Interpump Group SpA | 1584 | 61338 |
|  Interroll Holding AG (Registered) | 19 | 40060 |
|  Iveco Group NV\* (a) | 58712 | 317413 |
|  Japan Steel Works Ltd. (The) | 900 | 18619 |
|  Jungheinrich AG (Preference) | 3036 | 75556 |
|  Kardex Holding AG (Registered) | 264 | 40362 |
|  Kawasaki Heavy Industries Ltd. | 2800 | 47585 |
|  KION Group AG | 1419 | 31513 |
|  Komatsu Ltd. | 20100 | 385137 |
|  Komax Holding AG (Registered)(a) | 176 | 41329 |
|  Kone OYJ, Class B | 5904 | 241870 |
|  Konecranes OYJ(a) | 2273 | 57196 |
|  Krones AG | 484 | 44846 |
|  Kubota Corp.(a) | 14300 | 199778 |
|  Kurita Water Industries Ltd.(a) | 2500 | 91836 |
|  Makino Milling Machine Co. Ltd. | 8200 | 253500 |
|  Makita Corp. | 4600 | 84179 |
|  Manitou BF SA | 5124 | 104578 |
|  Max Co. Ltd. | 2800 | 39993 |
|  Meidensha Corp. | 15800 | 210582 |
|  Metso Outotec OYJ | 12669 | 96189 |
|  MINEBEA MITSUMI, Inc. | 7311 | 108409 |
|  MISUMI Group, Inc. | 3900 | 83439 |
|  Mitsubishi Heavy Industries Ltd. | 6400 | 220459 |
|  Mitsubishi Logisnext Co. Ltd. | 8400 | 43346 |
|  Miura Co. Ltd. | 2100 | 42880 |
|  Morgan Advanced Materials plc | 20416 | 57825 |
|  Nabtesco Corp. | 2900 | 61752 |
|  Nachi-Fujikoshi Corp. | 5800 | 152185 |
|  NGK Insulators Ltd. | 7900 | 92322 |
|  Nitta Corp. | 8200 | 159382 |
|  NSK Ltd. | 9600 | 50766 |
|  NTN Corp. | 168100 | 299704 |
|  OC Oerlikon Corp. AG (Registered) | 6510 | 42056 |
|  OKUMA Corp. | 9200 | 308864 |
|  OSG Corp. | 5700 | 72595 |

---

*See Accompanying Notes to the Financial Statements.* 

214 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Palfinger AG | 787 | $18201 |
|  Pfeiffer Vacuum Technology AG | 220 | 31093 |
|  Rational AG | 55 | 31039 |
|  Rotork plc | 13640 | 40235 |
|  Sandvik AB | 16810 | 262560 |
|  Schindler Holding AG | 658 | 107338 |
|  Schindler Holding AG (Registered) | 220 | 34646 |
|  SFS Group AG | 220 | 19895 |
|  Shibaura Machine Co. Ltd. | 2349 | 45705 |
|  Skellerup Holdings Ltd. | 10736 | 33057 |
|  SKF AB, Class A | 1408 | 21508 |
|  SKF AB, Class B(a) | 7626 | 110279 |
|  SMC Corp. | 900 | 364033 |
|  Spirax-Sarco Engineering plc | 1148 | 142088 |
|  Stabilus SE | 1188 | 65225 |
|  Stadler Rail AG | 1056 | 31129 |
|  Sulzer AG (Registered) | 546 | 36418 |
|  Sumitomo Heavy Industries Ltd. | 3300 | 62676 |
|  Tadano Ltd. | 8900 | 54489 |
|  Takeuchi Manufacturing Co. Ltd. | 10800 | 217984 |
|  Takuma Co. Ltd. | 28900 | 240323 |
|  Techtronic Industries Co. Ltd. | 23000 | 217845 |
|  THK Co. Ltd.(a) | 1700 | 29714 |
|  Tocalo Co. Ltd. | 3800 | 30424 |
|  Toyota Industries Corp. | 3800 | 195835 |
|  Trelleborg AB, Class B | 4682 | 103085 |
|  Troax Group AB | 1806 | 26803 |
|  Tsubakimoto Chain Co. | 10400 | 222855 |
|  Union Tool Co. | 500 | 12060 |
|  Valmet OYJ(a) | 3228 | 73475 |
|  VAT Group AG(a) (b) | 451 | 103111 |
|  Vesuvius plc | 64165 | 250589 |
|  Volvo AB, Class A | 3212 | 54820 |
|  Volvo AB, Class B | 31324 | 512502 |
|  Wacker Neuson SE | 7954 | 125546 |
|  Wartsila OYJ Abp | 5720 | 39008 |
|  Weir Group plc (The) | 3920 | 68715 |
|  Yaskawa Electric Corp. | 4100 | 113923 |
|  |  | **14908841** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Marine – 0.6%** | **Marine – 0.6%** | **Marine – 0.6%** |
|  AP Moller – Maersk A/S, Class A | 65 | $130129 |
|  AP Moller – Maersk A/S, Class B | 123 | 257347 |
|  Belships ASA(a) | 19194 | 26843 |
|  Clarkson plc | 1408 | 44823 |
|  D/S Norden A/S | 8241 | 427555 |
|  Dfds A/S | 10127 | 307606 |
|  Golden Ocean Group Ltd. | 4796 | 39394 |
|  Kawasaki Kisen Kaisha Ltd.(a) | 6000 | 91271 |
|  Kuehne + Nagel International AG (Registered)(a) | 697 | 148628 |
|  Mitsui OSK Lines Ltd.(a) | 9300 | 184642 |
|  MPC Container Ships ASA(a) | 18920 | 29844 |
|  Nippon Yusen KK(a) | 12300 | 223351 |
|  NS United Kaiun Kaisha Ltd. | 4100 | 102062 |
|  Pacific Basin Shipping Ltd.(a) | 1722000 | 416798 |
|  SITC International Holdings Co. Ltd. | 24000 | 39318 |
|  Stolt-Nielsen Ltd. | 6560 | 157425 |
|  Wallenius Wilhelmsen ASA | 5632 | 40059 |
|  Wilh Wilhelmsen Holding ASA, Class A(a) | 4368 | 101671 |
|  Wilh Wilhelmsen Holding ASA, Class B | 1344 | 30378 |
|  |  | **2799144** |
| **Media – 1.0%** | **Media – 1.0%** | **Media – 1.0%** |
|  4imprint Group plc | 836 | 33400 |
|  Ascential plc\* (b) | 26292 | 58121 |
|  Cogeco Communications, Inc.(a) | 6232 | 317437 |
|  Cogeco, Inc. | 2870 | 122076 |
|  CyberAgent, Inc. | 6300 | 51880 |
|  Cyfrowy Polsat SA | 8140 | 30538 |
|  Dentsu Group, Inc.(a) | 3800 | 118498 |
|  Euromoney Institutional Investor plc | 4083 | 68070 |
|  Eutelsat Communications SA(a) | 51537 | 517516 |
|  Future plc | 2332 | 32703 |
|  Hakuhodo DY Holdings, Inc. | 4700 | 39716 |
|  Informa plc | 27019 | 172838 |
|  IPSOS | 13407 | 649290 |
|  ITV plc | 82500 | 63641 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 215

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  JCDecaux SE\* | 968 | $| 12217 |
|  Kadokawa Corp. | 2200 |  | 39549 |
|  Lagardere SA(a) | 2552 |  | 44619 |
|  Mediaset Espana Comunicacion SA\* | 2856 |  | 8875 |
|  Metropole Television SA | 19065 |  | 197285 |
|  MFE-MediaForEurope NV, Class B | 79422 |  | 39641 |
|  Next Fifteen Communications Group plc | 5104 |  | 51596 |
|  Nine Entertainment Co. Holdings Ltd.(a) | 10556 |  | 13905 |
|  Nippon Television Holdings, Inc. | 2400 |  | 17923 |
|  oOh!media Ltd.(a) | 47520 |  | 38439 |
|  Pearson plc | 13448 |  | 148702 |
|  ProSiebenSat.1 Media SE | 2772 |  | 18849 |
|  Publicis Groupe SA | 4879 |  | 273609 |
|  Quebecor, Inc., Class B | 2728 |  | 51358 |
|  RTL Group SA(a) | 1056 |  | 35841 |
|  S4 Capital plc\* | 10516 |  | 21273 |
|  Schibsted ASA, Class A | 1144 |  | 17616 |
|  Schibsted ASA, Class B | 2493 |  | 36999 |
|  SES SA, ADR | 5964 |  | 42311 |
|  Seven West Media Ltd.\* (a) | 391386 |  | 117628 |
|  Shaw Communications, Inc., Class B | 6424 |  | 164785 |
|  SKY Perfect JSAT Holdings, Inc.(a) | 48100 |  | 168602 |
|  Stroeer SE & Co. KGaA | 620 |  | 25283 |
|  Telenet Group Holding NV | 1320 |  | 20130 |
|  Television Francaise 1(a) | 35383 |  | 224512 |
|  TV Asahi Holdings Corp. | 8400 |  | 78781 |
|  TX Group AG | 352 |  | 48891 |
|  ValueCommerce Co. Ltd. | 1400 |  | 20468 |
|  Viaplay Group AB, Class B\* | 1188 |  | 21673 |
|  Vivendi SE | 9786 |  | 80123 |
|  WPP plc | 19393 |  | 171033 |
|  YouGov plc | 7040 |  | 72463 |
|  |  |  | **4600703** |
| **Metals & Mining – 4.8%** | **Metals & Mining – 4.8%** | **Metals & Mining – 4.8%** | **Metals & Mining – 4.8%** |
|  Acerinox SA | 7260 |  | 63589 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Agnico Eagle Mines Ltd. | 6970 | $306229 |
|  Alamos Gold, Inc., Class A | 3983 | 31390 |
|  Algoma Steel Group, Inc. | 33768 | 228495 |
|  Allkem Ltd.\* | 8316 | 76787 |
|  Alumina Ltd.(a) | 42504 | 36692 |
|  AMG Advanced Metallurgical Group NV | 1540 | 48188 |
|  Anglo American plc | 28864 | 866871 |
|  Antofagasta plc | 6802 | 92059 |
|  Aperam SA | 1594 | 41670 |
|  ArcelorMittal SA | 13046 | 292114 |
|  Asahi Holdings, Inc.(a) | 28100 | 359013 |
|  Aurubis AG | 1050 | 66334 |
|  AVZ Minerals Ltd.\* ‡ (a) | 111012 | 39717 |
|  B2Gold Corp. | 27675 | 84402 |
|  Barrick Gold Corp. | 26978 | 396518 |
|  Bekaert SA | 1540 | 42922 |
|  Bellevue Gold Ltd.\* (a) | 49941 | 23632 |
|  BHP Group Ltd. | 105370 | 2517274 |
|  BlueScope Steel Ltd. | 10209 | 102688 |
|  Boliden AB | 5166 | 150346 |
|  Capricorn Metals Ltd.\* | 19272 | 41777 |
|  Capstone Copper Corp.\* | 10472 | 24260 |
|  Centamin plc | 383678 | 391919 |
|  Centerra Gold, Inc. | 17010 | 78936 |
|  Chalice Mining Ltd.\* (a) | 10120 | 27632 |
|  Champion Iron Ltd.(a) | 6468 | 19356 |
|  Daido Steel Co. Ltd.(a) | 13100 | 340203 |
|  De Grey Mining Ltd.\* (a) | 86240 | 58455 |
|  Deterra Royalties Ltd. | 15180 | 39701 |
|  Dowa Holdings Co. Ltd. | 1100 | 35042 |
|  Dundee Precious Metals, Inc. | 56826 | 257457 |
|  Eldorado Gold Corp.\* (a) | 61500 | 343107 |
|  Endeavour Mining plc | 3438 | 60037 |
|  Equinox Gold Corp.\* (a) | 9450 | 31106 |
|  Eramet SA | 504 | 33051 |
|  ERO Copper Corp.\* (a) | 4268 | 48530 |
|  Evolution Mining Ltd.(a) | 35786 | 47597 |
|  Falcon Metals Ltd.\* | 1 | — (e) |
|  Ferrexpo plc | 80770 | 94947 |
|  Filo Mining Corp.\* | 2772 | 33165 |
|  First Majestic Silver Corp. | 3432 | 28834 |
|  First Quantum Minerals Ltd.(a) | 9143 | 161069 |

---

*See Accompanying Notes to the Financial Statements.* 

216 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Fortescue Metals Group Ltd.(a) | 37802 | $355336 |
|  Fortuna Silver Mines, Inc.\* (a) | 98523 | 273745 |
|  Franco-Nevada Corp. | 2747 | 338992 |
|  Fresnillo plc | 3872 | 32499 |
|  Glencore plc | 247435 | 1422997 |
|  Gold Road Resources Ltd.(a) | 80872 | 70072 |
|  Grange Resources Ltd.(a) | 140658 | 55765 |
|  Granges AB | 36654 | 247612 |
|  Grupa Kety SA | 308 | 31824 |
|  Hill & Smith Holdings plc | 5236 | 59561 |
|  Hitachi Metals Ltd.\* | 4740 | 69266 |
|  Hochschild Mining plc | 97398 | 59826 |
|  Hudbay Minerals, Inc. | 63878 | 242109 |
|  IAMGOLD Corp.\* | 17424 | 25547 |
|  IGO Ltd. | 12886 | 125989 |
|  Iluka Resources Ltd. | 6916 | 38254 |
|  Imdex Ltd. | 22176 | 28928 |
|  ioneer Ltd.\* (a) | 110528 | 39226 |
|  Ivanhoe Mines Ltd., Class A\* (a) | 13068 | 90534 |
|  Jastrzebska Spolka Weglowa SA\* | 3124 | 27198 |
|  Jervois Global Ltd.\* (a) | 49165 | 15405 |
|  JFE Holdings, Inc.(a) | 12300 | 112792 |
|  K92 Mining, Inc.\* | 16544 | 75076 |
|  KGHM Polska Miedz SA | 2288 | 45872 |
|  Kinross Gold Corp. | 22985 | 83242 |
|  Kobe Steel Ltd. | 125800 | 516285 |
|  Labrador Iron Ore Royalty Corp.(a) | 22345 | 462610 |
|  Lake Resources NL\* (a) | 76296 | 51715 |
|  Lithium Americas Corp.\* | 2508 | 62330 |
|  Lundin Gold, Inc. | 6342 | 45750 |
|  Lundin Mining Corp. | 12726 | 66613 |
|  Lynas Rare Earths Ltd.\* | 18409 | 98058 |
|  MAG Silver Corp.\* | 4656 | 61782 |
|  Maruichi Steel Tube Ltd. | 6100 | 115364 |
|  Mineral Resources Ltd. | 3526 | 164886 |
|  Mitsubishi Materials Corp. | 3800 | 49751 |
|  Mitsui Mining & Smelting Co. Ltd. | 18000 | 364517 |
|  New Gold, Inc.\* (a) | 221072 | 199346 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Newcrest Mining Ltd.(a) | 14350 | $159205 |
|  Nickel Industries Ltd.(a) | 46684 | 21792 |
|  Nippon Light Metal Holdings Co. Ltd. | 20500 | 200124 |
|  Nippon Steel Corp. | 20215 | 277789 |
|  Norsk Hydro ASA | 33333 | 211536 |
|  Northern Star Resources Ltd.(a) | 17556 | 98117 |
|  Novagold Resources, Inc.\* | 16044 | 73983 |
|  OceanaGold Corp.\* | 1000 | 1452 |
|  OceanaGold Corp.\* | 54818 | 79572 |
|  Orla Mining Ltd.\* (a) | 10780 | 33983 |
|  Osisko Gold Royalties Ltd.(a) | 9030 | 96718 |
|  Osisko Mining, Inc.\* | 27456 | 57164 |
|  Outokumpu OYJ | 7392 | 29684 |
|  OZ Minerals Ltd.(a) | 6649 | 102764 |
|  Pan American Silver Corp. | 4082 | 65088 |
|  Perseus Mining Ltd.(a) | 97826 | 114163 |
|  Pilbara Minerals Ltd.\* | 35307 | 114917 |
|  Regis Resources Ltd.(a) | 245262 | 239170 |
|  Rio Tinto Ltd. | 7872 | 443977 |
|  Rio Tinto plc | 21812 | 1139388 |
|  Salzgitter AG | 13366 | 299081 |
|  Sandfire Resources Ltd.(a) | 125911 | 280188 |
|  Sandstorm Gold Ltd.(a) | 13772 | 67747 |
|  Sanyo Special Steel Co. Ltd. | 8600 | 110686 |
|  Sayona Mining Ltd.\* (a) | 267529 | 40202 |
|  Seabridge Gold, Inc.\* | 5588 | 59606 |
|  Silver Lake Resources Ltd.\* | 70620 | 50125 |
|  SilverCrest Metals, Inc.\* (a) | 9416 | 47147 |
|  Sims Ltd. | 3192 | 24943 |
|  Solaris Resources, Inc.\* (a) | 3872 | 13767 |
|  SolGold plc\* (a) | 78960 | 14546 |
|  South32 Ltd.(a) | 102254 | 235391 |
|  SSAB AB, Class A | 10296 | 49512 |
|  SSAB AB, Class B | 9504 | 44155 |
|  SSR Mining, Inc.(a) | 3864 | 53142 |
|  St Barbara Ltd.\* (a) | 278964 | 90976 |
|  Stalprodukt SA | 546 | 25347 |
|  Stelco Holdings, Inc. | 596 | 14991 |
|  Sumitomo Metal Mining Co. Ltd. | 5900 | 166003 |
|  Syrah Resources Ltd.\* | 68502 | 104691 |
|  Teck Resources Ltd., Class B(a) | 9922 | 301650 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 217

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  thyssenkrupp AG\* | 8316 | $| 43824 |
|  Toho Titanium Co. Ltd. | 200 |  | 3024 |
|  Tokyo Steel Manufacturing Co. Ltd.(a) | 28700 |  | 246383 |
|  Torex Gold Resources, Inc.\* | 24641 |  | 167639 |
|  Turquoise Hill Resources Ltd.\* (a) | 2730 |  | 76773 |
|  UACJ Corp. | 11100 |  | 158395 |
|  voestalpine AG | 1880 |  | 40841 |
|  Vulcan Energy Resources Ltd.\* (a) | 6732 |  | 32802 |
|  Wesdome Gold Mines Ltd.\* | 8888 |  | 53235 |
|  West African Resources Ltd.\* (a) | 298070 |  | 198225 |
|  Westgold Resources Ltd.\* (a) | 153415 |  | 71614 |
|  Wheaton Precious Metals Corp. | 6929 |  | 226403 |
|  Yamana Gold, Inc. | 17010 |  | 74572 |
|  Yamato Kogyo Co. Ltd. | 1300 |  | 37784 |
|  Yodogawa Steel Works Ltd.(a) | 11100 |  | 180799 |
|  |  |  | **21556580** |
| **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** |
|  B&M European Value Retail SA(a) | 16926 |  | 62868 |
|  Canadian Tire Corp. Ltd., Class A(a) | 1164 |  | 130297 |
|  Dollarama, Inc.(a) | 4141 |  | 245749 |
|  Europris ASA(b) | 61828 |  | 368107 |
|  H2O Retailing Corp. | 5615 |  | 47221 |
|  Harvey Norman Holdings Ltd.(a) | 17952 |  | 47754 |
|  Isetan Mitsukoshi Holdings Ltd. | 9100 |  | 80815 |
|  Izumi Co. Ltd. | 13600 |  | 274406 |
|  Next plc | 2255 |  | 127971 |
|  Pan Pacific International Holdings Corp. | 8200 |  | 134667 |
|  Ryohin Keikaku Co. Ltd. | 6000 |  | 56555 |
|  Seria Co. Ltd. | 1000 |  | 16362 |
|  Takashimaya Co. Ltd.(a) | 53500 |  | 661574 |
|  Tokmanni Group Corp. | 13120 |  | 158718 |
|  Warehouse Group Ltd. (The)(a) | 30712 |  | 55311 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Multiline Retail – (continued)** | **Multiline Retail – (continued)** | **Multiline Retail – (continued)** | **Multiline Retail – (continued)** |
|  Wesfarmers Ltd. | 15621 | $| 454093 |
|  |  |  | **2922468** |
| **Multi-Utilities – 0.5%** | **Multi-Utilities – 0.5%** | **Multi-Utilities – 0.5%** | **Multi-Utilities – 0.5%** |
|  A2A SpA | 51964 |  | 57624 |
|  ACEA SpA | 1552 |  | 19557 |
|  AGL Energy Ltd.(a) | 12344 |  | 53754 |
|  Algonquin Power & Utilities Corp.(a) | 11661 |  | 128916 |
|  Atco Ltd., Class I | 1064 |  | 32995 |
|  Canadian Utilities Ltd., Class A(a) | 1628 |  | 43265 |
|  Centrica plc | 117711 |  | 103840 |
|  E.ON SE | 43747 |  | 366480 |
|  Engie SA | 36654 |  | 476530 |
|  Hera SpA | 19272 |  | 45942 |
|  Iren SpA | 19624 |  | 29171 |
|  National Grid plc | 54612 |  | 596330 |
|  REN – Redes Energeticas Nacionais SGPS SA | 31584 |  | 81786 |
|  Sembcorp Industries Ltd. | 4000 |  | 8226 |
|  Telecom Plus plc | 4728 |  | 115676 |
|  Veolia Environnement SA | 10824 |  | 241666 |
|  |  |  | **2401758** |
| **Oil, Gas & Consumable Fuels – 6.7%** | **Oil, Gas & Consumable Fuels – 6.7%** | **Oil, Gas & Consumable Fuels – 6.7%** | **Oil, Gas & Consumable Fuels – 6.7%** |
|  Advantage Energy Ltd.\* | 10340 |  | 78078 |
|  Africa Oil Corp.(a) | 135900 |  | 332763 |
|  Aker BP ASA(a) | 6319 |  | 201418 |
|  Ampol Ltd.(a) | 2420 |  | 42138 |
|  ARC Resources Ltd.(a) | 15047 |  | 211577 |
|  Athabasca Oil Corp.\* | 174619 |  | 352041 |
|  Baytex Energy Corp.\* | 17514 |  | 95014 |
|  Beach Energy Ltd. | 39336 |  | 39994 |
|  Birchcliff Energy Ltd.(a) | 89421 |  | 694233 |
|  BP plc | 431033 |  | 2381103 |
|  BRIGHTOIL\* ‡ | 50147 |  |  |
|  BW Energy Ltd.\* | 14036 |  | 35506 |
|  BW LPG Ltd.(b) | 29766 |  | 240777 |
|  Cameco Corp. | 6765 |  | 160241 |
|  Canadian Natural Resources Ltd. | 24354 |  | 1458865 |
|  Capricorn Energy plc\* | 23656 |  | 67437 |
|  Cenovus Energy, Inc.(a) | 31488 |  | 635739 |

---

*See Accompanying Notes to the Financial Statements.* 

218 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Crescent Point Energy Corp. | 12474 | $97392 |
|  Denison Mines Corp.\* | 53196 | 67078 |
|  Diversified Energy Co. plc(b) | 301022 | 436000 |
|  DNO ASA | 22968 | 29956 |
|  Enbridge, Inc. | 29151 | 1134368 |
|  ENEOS Holdings, Inc. | 73850 | 243359 |
|  Energean plc | 38212 | 629574 |
|  Energy Fuels, Inc.\* | 10296 | 74349 |
|  Enerplus Corp. | 7052 | 122113 |
|  Eni SpA | 52726 | 690689 |
|  Equinor ASA | 23001 | 841450 |
|  Euronav NV | 4116 | 71720 |
|  FLEX LNG Ltd. | 1176 | 36535 |
|  Freehold Royalties Ltd. | 5060 | 62877 |
|  Frontera Energy Corp.\* | 16318 | 136377 |
|  Galp Energia SGPS SA, Class B | 11726 | 119081 |
|  Gaztransport Et Technigaz SA | 660 | 76777 |
|  Gibson Energy, Inc. | 1537 | 26198 |
|  Hafnia Ltd. | 45745 | 235834 |
|  Harbour Energy plc | 13992 | 60878 |
|  Headwater Exploration, Inc.\* (a) | 54407 | 287980 |
|  Idemitsu Kosan Co. Ltd. | 5882 | 128614 |
|  Imperial Oil Ltd. | 4879 | 265080 |
|  Inpex Corp. | 22500 | 229791 |
|  International Petroleum Corp.\* (a) | 32923 | 328011 |
|  Itochu Enex Co. Ltd.(a) | 16500 | 113563 |
|  Iwatani Corp. | 1397 | 51506 |
|  Japan Petroleum Exploration Co. Ltd.(a) | 11300 | 293457 |
|  Karoon Energy Ltd.\* | 45716 | 61974 |
|  Keyera Corp.(a) | 3108 | 66532 |
|  Koninklijke Vopak NV | 1558 | 31875 |
|  MEG Energy Corp.\* | 4928 | 73592 |
|  Neste OYJ | 6355 | 278498 |
|  New Hope Corp. Ltd. | 17010 | 61455 |
|  NexGen Energy Ltd.\* (a) | 16236 | 68084 |
|  Norwegian Energy Co. ASA\* (a) | 882 | 32661 |
|  NuVista Energy Ltd.\* (a) | 57974 | 574194 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Oil Refineries Ltd. | 123564 | $| 46273 |
|  OMV AG | 3649 |  | 168207 |
|  Pantheon Resources plc\* (a) | 52080 |  | 60022 |
|  Paramount Resources Ltd., Class A(a) | 2772 |  | 58649 |
|  Parex Resources, Inc.(a) | 39811 |  | 606483 |
|  Parkland Corp. | 2231 |  | 45044 |
|  Paz Oil Co. Ltd.\* | 421 |  | 50483 |
|  Pembina Pipeline Corp.(a) | 7503 |  | 247414 |
|  Peyto Exploration & Development Corp.(a) | 58138 |  | 542147 |
|  Polski Koncern Naftowy ORLEN SA | 5060 |  | 58242 |
|  Polskie Gornictwo Naftowe i Gazownictwo SA\* | 60060 |  | 64801 |
|  PrairieSky Royalty Ltd.(a) | 5586 |  | 86654 |
|  Repsol SA | 29356 |  | 398797 |
|  Santos Ltd. | 69495 |  | 342177 |
|  Serica Energy plc | 77449 |  | 267513 |
|  Shell plc | 159572 |  | 4416706 |
|  Spartan Delta Corp.\* | 44362 |  | 407829 |
|  Suncor Energy, Inc. | 27757 |  | 953552 |
|  Tamarack Valley Energy Ltd.(a) | 118203 |  | 454944 |
|  TC Energy Corp. | 14965 |  | 656505 |
|  Topaz Energy Corp. | 3344 |  | 56483 |
|  TotalEnergies SE | 50963 |  | 2775347 |
|  Tourmaline Oil Corp.(a) | 6658 |  | 374670 |
|  Tullow Oil plc\* (a) | 513894 |  | 239627 |
|  United Energy Group Ltd. | 358000 |  | 34660 |
|  Vermilion Energy, Inc. | 5002 |  | 116575 |
|  Washington H Soul Pattinson & Co. Ltd.(a) | 2856 |  | 51026 |
|  Whitecap Resources, Inc. | 12558 |  | 97220 |
|  Whitehaven Coal Ltd.(a) | 16702 |  | 96441 |
|  Woodside Energy Group Ltd.(a) | 38213 |  | 879180 |
|  |  |  | **29820067** |
| **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** |
|  Altri SGPS SA(a) | 21115 |  | 117597 |
|  Canfor Corp.\* | 18163 |  | 272568 |
|  Daio Paper Corp. | 3745 |  | 27665 |
|  Hokuetsu Corp.(a) | 61600 |  | 319946 |
|  Holmen AB, Class B | 1540 |  | 55828 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 219

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** |
|  Interfor Corp.\* (a) | 16482 | $| 292412 |
|  Metsa Board OYJ, Class B | 6595 |  | 49603 |
|  Mondi plc | 10004 |  | 168452 |
|  Navigator Co. SA (The) | 5269 |  | 20091 |
|  Nippon Paper Industries Co. Ltd.(a) | 36500 |  | 212662 |
|  Norske Skog ASA\* (c) | 28495 |  | 175407 |
|  Oji Holdings Corp. | 25400 |  | 88178 |
|  Semapa-Sociedade de Investimento e Gestao | 3520 |  | 44810 |
|  Stella-Jones, Inc.(a) | 3566 |  | 107264 |
|  Stora Enso OYJ, Class R | 11644 |  | 151795 |
|  Svenska Cellulosa AB SCA, Class A(a) | 2068 |  | 24927 |
|  Svenska Cellulosa AB SCA, Class B | 8692 |  | 102491 |
|  UPM-Kymmene OYJ | 8364 |  | 280319 |
|  West Fraser Timber Co. Ltd.(a) | 1640 |  | 122984 |
|  |  |  | **2634999** |
| **Personal Products – 0.9%** | **Personal Products – 0.9%** | **Personal Products – 0.9%** | **Personal Products – 0.9%** |
|  Beiersdorf AG | 1640 |  | 157518 |
|  Blackmores Ltd.(a) | 1320 |  | 57397 |
|  euglena Co. Ltd.\* (a) | 4400 |  | 26376 |
|  Fancl Corp. | 400 |  | 7592 |
|  Interparfums SA | 145 |  | 6993 |
|  Jamieson Wellness, Inc.(b) | 2330 |  | 56933 |
|  Kao Corp. | 7500 |  | 282067 |
|  Kobayashi Pharmaceutical Co. Ltd. | 900 |  | 47835 |
|  Kose Corp. | 700 |  | 70031 |
|  L'Occitane International SA(a) | 4500 |  | 11064 |
|  L'Oreal SA | 3649 |  | 1147224 |
|  Milbon Co. Ltd. | 1000 |  | 41309 |
|  Noevir Holdings Co. Ltd. | 1000 |  | 37003 |
|  Pola Orbis Holdings, Inc. | 2000 |  | 22135 |
|  PZ Cussons plc | 28228 |  | 65001 |
|  Rohto Pharmaceutical Co. Ltd.(a) | 2000 |  | 62233 |
|  Shiseido Co. Ltd. | 6400 |  | 221967 |
|  Unilever plc | 14567 |  | 666592 |
|  Unilever plc | 23440 |  | 1070659 |
|  |  |  | **4057929** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Pharmaceuticals – 4.7%** | **Pharmaceuticals – 4.7%** | **Pharmaceuticals – 4.7%** |
|  ALK-Abello A/S\* | 2640 | $43740 |
|  Almirall SA | 4471 | 41692 |
|  Astellas Pharma, Inc. | 28700 | 395160 |
|  AstraZeneca plc | 22591 | 2667081 |
|  Bausch Health Cos., Inc.\* | 7014 | 45558 |
|  Bayer AG (Registered) | 20746 | 1091239 |
|  Camurus AB\* | 2860 | 66308 |
|  Canopy Growth Corp.\* | 6156 | 22971 |
|  Chugai Pharmaceutical Co. Ltd. | 8200 | 190332 |
|  COSMO Pharmaceuticals NV(a) | 413 | 24142 |
|  Daiichi Sankyo Co. Ltd. | 29800 | 955741 |
|  Dechra Pharmaceuticals plc | 2142 | 64614 |
|  Eisai Co. Ltd. | 4500 | 271692 |
|  Faes Farma SA | 17235 | 64986 |
|  Financiere de Tubize SA(a) | 264 | 17508 |
|  GSK plc | 57826 | 951266 |
|  H Lundbeck A/S, Class A\* | 484 | 1645 |
|  Haw Par Corp. Ltd. | 3200 | 21369 |
|  Hikma Pharmaceuticals plc | 2900 | 41703 |
|  Hisamitsu Pharmaceutical Co., Inc. | 1900 | 46914 |
|  Hutchmed China Ltd.\* (a) | 7150 | 12480 |
|  Indivior plc\* | 4124 | 78772 |
|  Ipsen SA | 770 | 79147 |
|  JCR Pharmaceuticals Co. Ltd. | 2400 | 35765 |
|  Kaken Pharmaceutical Co. Ltd. | 1500 | 38399 |
|  Kissei Pharmaceutical Co. Ltd. | 1400 | 24763 |
|  KYORIN Holdings, Inc. | 4400 | 54439 |
|  Kyowa Kirin Co. Ltd. | 4300 | 101399 |
|  Merck KGaA | 2091 | 340996 |
|  Mochida Pharmaceutical Co. Ltd. | 900 | 20739 |
|  Nippon Shinyaku Co. Ltd.(a) | 1400 | 77613 |
|  Novartis AG (Registered) | 35055 | 2833824 |
|  Novo Nordisk A/S, Class B | 24190 | 2630454 |
|  Ono Pharmaceutical Co. Ltd. | 5900 | 138772 |
|  Orion OYJ, Class A | 352 | 16143 |
|  Orion OYJ, Class B | 1404 | 64595 |
|  Otsuka Holdings Co. Ltd. | 8300 | 266141 |
|  Recordati Industria Chimica e Farmaceutica SpA | 1628 | 61192 |
|  Roche Holding AG | 10291 | 3419707 |

---

*See Accompanying Notes to the Financial Statements.* 

220 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Roche Holding AG – BR | 463 | $| 187930 |
|  Sanofi | 16646 |  | 1436760 |
|  Santen Pharmaceutical Co. Ltd. | 4500 |  | 30820 |
|  Sawai Group Holdings Co. Ltd. | 14100 |  | 406489 |
|  Shionogi & Co. Ltd. | 4400 |  | 203963 |
|  Sosei Group Corp.\* | 5200 |  | 71125 |
|  Sumitomo Pharma Co. Ltd. | 3600 |  | 25117 |
|  Taisho Pharmaceutical Holdings Co. Ltd. | 600 |  | 21637 |
|  Takeda Pharmaceutical Co. Ltd. | 32117 |  | 846600 |
|  Teva Pharmaceutical Industries Ltd.\* (a) | 26117 |  | 234641 |
|  Torii Pharmaceutical Co. Ltd. | 800 |  | 16255 |
|  Towa Pharmaceutical Co. Ltd. | 9400 |  | 141346 |
|  Tsumura & Co. | 900 |  | 18801 |
|  UCB SA | 2173 |  | 163911 |
|  Vetoquinol SA | 308 |  | 25601 |
|  Virbac SA | 132 |  | 32355 |
|  ZERIA Pharmaceutical Co. Ltd.(a) | 1800 |  | 26848 |
|  |  |  | **21211200** |
| **Professional Services – 1.3%** | **Professional Services – 1.3%** | **Professional Services – 1.3%** | **Professional Services – 1.3%** |
|  Adecco Group AG (Registered) | 3690 |  | 115558 |
|  AFRY AB, Class B | 2640 |  | 35429 |
|  ALS Ltd.(a) | 8712 |  | 63731 |
|  Amadeus Fire AG | 352 |  | 35555 |
|  Applus Services SA | 47396 |  | 280595 |
|  BayCurrent Consulting, Inc. | 3000 |  | 84570 |
|  Benefit One, Inc. | 1000 |  | 13886 |
|  BeNext-Yumeshin Group Co.(a) | 4400 |  | 53226 |
|  BTS Group AB, Class B | 1100 |  | 28868 |
|  Bureau Veritas SA | 4005 |  | 99236 |
|  Danel Adir Yeoshua Ltd.(a) | 220 |  | 25629 |
|  dip Corp. | 1400 |  | 39277 |
|  DKSH Holding AG | 660 |  | 47583 |
|  Experian plc | 14883 |  | 475340 |
|  Funai Soken Holdings, Inc.(a) | 2700 |  | 48193 |
|  GlobalData plc | 2508 |  | 32702 |
|  Hays plc | 34264 |  | 43355 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** |
|  Insource Co. Ltd. | 1900 | $| 38541 |
|  Intertek Group plc | 2214 |  | 93144 |
|  Intertrust NV\* (b) | 6642 |  | 131030 |
|  IPH Ltd.(a) | 13904 |  | 88376 |
|  JAC Recruitment Co. Ltd. | 1300 |  | 22128 |
|  Meitec Corp. | 2400 |  | 40513 |
|  Nihon M&A Center Holdings, Inc. | 4800 |  | 54351 |
|  Nomura Co. Ltd. | 6000 |  | 43960 |
|  Outsourcing, Inc.(a) | 32800 |  | 257086 |
|  Pagegroup plc | 101311 |  | 492473 |
|  Pasona Group, Inc. | 6000 |  | 82834 |
|  Persol Holdings Co. Ltd. | 4200 |  | 84376 |
|  Randstad NV(a) | 2419 |  | 120593 |
|  Recruit Holdings Co. Ltd. | 24100 |  | 744232 |
|  RELX plc | 30340 |  | 817757 |
|  RWS Holdings plc | 15666 |  | 55229 |
|  SGS SA (Registered) | 82 |  | 181002 |
|  SmartGroup Corp. Ltd. | 7766 |  | 24433 |
|  SMS Co. Ltd. | 2000 |  | 46019 |
|  S-Pool, Inc. | 4400 |  | 28211 |
|  Synergie SE | 1512 |  | 40871 |
|  TechnoPro Holdings, Inc.(a) | 1100 |  | 26235 |
|  Teleperformance | 861 |  | 230868 |
|  Thomson Reuters Corp.(a) | 2337 |  | 248237 |
|  Tinexta Spa | 1056 |  | 21291 |
|  UT Group Co. Ltd. | 2000 |  | 32738 |
|  Weathernews, Inc. | 500 |  | 26104 |
|  Wolters Kluwer NV | 3545 |  | 376823 |
|  |  |  | **5972188** |
| **Real Estate Management & Development – 2.0%** | **Real Estate Management & Development – 2.0%** | **Real Estate Management & Development – 2.0%** | **Real Estate Management & Development – 2.0%** |
|  ADLER Group SA\* (a) (b) | 27258 |  | 40465 |
|  Aedas Homes SA(b) | 6437 |  | 83597 |
|  Aeon Mall Co. Ltd. | 1990 |  | 21649 |
|  AFI Properties Ltd. | 165 |  | 4969 |
|  Africa Israel Residences Ltd.(a) | 1386 |  | 55920 |
|  Airport City Ltd.\* | 1928 |  | 32074 |
|  Allreal Holding AG (Registered) | 366 |  | 52445 |
|  Alony Hetz Properties & Investments Ltd. | 2596 |  | 30611 |
|  Altus Group Ltd. | 2578 |  | 91493 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 221

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Amot Investments Ltd. | 5448 | $33126 |
|  Aroundtown SA(a) | 20160 | 40010 |
|  Atrium Ljungberg AB, Class B | 792 | 10586 |
|  Aura Investments Ltd. | 20958 | 37218 |
|  Azrieli Group Ltd. | 532 | 39619 |
|  Big Shopping Centers Ltd. | 16 | 1803 |
|  Blue Square Real Estate Ltd.(a) | 2296 | 153241 |
|  Bukit Sembawang Estates Ltd. | 57400 | 164684 |
|  CA Immobilien Anlagen AG(a) | 572 | 18063 |
|  Capitaland Investment Ltd. | 42131 | 89615 |
|  Castellum AB(a) | 4830 | 55204 |
|  Catena AB | 924 | 31390 |
|  Cibus Nordic Real Estate AB | 3432 | 46850 |
|  City Developments Ltd. | 9400 | 50683 |
|  Citycon OYJ\* (a) | 21894 | 136434 |
|  CK Asset Holdings Ltd. | 41000 | 226680 |
|  CLS Holdings plc, REIT | 14403 | 23780 |
|  Colliers International Group, Inc.(a) | 748 | 70114 |
|  Corem Property Group AB, Class B | 19888 | 12382 |
|  Daito Trust Construction Co. Ltd. | 1600 | 158348 |
|  Daiwa House Industry Co. Ltd. | 15300 | 310045 |
|  Deutsche EuroShop AG | 4410 | 94582 |
|  Deutsche Wohnen SE | 1012 | 20424 |
|  DIC Asset AG | 3740 | 25801 |
|  Dios Fastigheter AB | 7480 | 49109 |
|  DREAM Unlimited Corp., Class A(a) | 1584 | 28857 |
|  Entra ASA(b) | 2068 | 18807 |
|  ESR Group Ltd.(a) (b) | 49200 | 83986 |
|  Fabege AB | 5412 | 39268 |
|  Fastighets AB Balder, Class B\* | 12348 | 46367 |
|  FastPartner AB, Class A | 3124 | 19083 |
|  FirstService Corp. | 676 | 84403 |
|  Gav-Yam Lands Corp. Ltd. | 593 | 5055 |
|  Grainger plc | 11088 | 28979 |
|  Grand City Properties SA | 2508 | 24416 |
|  Great Eagle Holdings Ltd.(a) | 83451 | 153085 |
|  GuocoLand Ltd. | 100000 | 109533 |
|  Hang Lung Group Ltd. | 238000 | 308648 |
|  Hang Lung Properties Ltd. | 44000 | 55323 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Heba Fastighets AB, Class B | 5280 | $15075 |
|  Heiwa Real Estate Co. Ltd. | 1300 | 36122 |
|  Henderson Land Development Co. Ltd. | 33239 | 81384 |
|  Hiag Immobilien Holding AG | 355 | 28592 |
|  Ho Bee Land Ltd. | 76800 | 125368 |
|  Hufvudstaden AB, Class A | 2610 | 31083 |
|  Hulic Co. Ltd. | 13400 | 97366 |
|  Hysan Development Co. Ltd. | 19000 | 41438 |
|  Ichigo, Inc. | 5500 | 12396 |
|  Immobel SA(a) | 1554 | 63586 |
|  Intershop Holding AG | 76 | 46249 |
|  Israel Canada T.R Ltd.(a) | 7168 | 20774 |
|  Isras Investment Co. Ltd. | 136 | 25716 |
|  IWG plc\* | 18668 | 28371 |
|  Jeudan A/S | 560 | 19850 |
|  K Wah International Holdings Ltd. | 546089 | 153047 |
|  Katitas Co. Ltd.(a) | 1100 | 24681 |
|  Kerry Properties Ltd. | 16500 | 26106 |
|  K-fast Holding AB\* (b) | 5148 | 10575 |
|  Kojamo OYJ(a) | 1980 | 25773 |
|  Kowloon Development Co. Ltd. | 123000 | 109370 |
|  LEG Immobilien SE | 1353 | 88418 |
|  Lendlease Corp. Ltd.(a) | 14582 | 81030 |
|  Levinstein Properties Ltd.(a) | 2814 | 73374 |
|  Lifestyle Communities Ltd.(a) | 5148 | 57773 |
|  Mega Or Holdings Ltd., REIT | 1085 | 31691 |
|  Melisron Ltd. | 460 | 34296 |
|  Mitsubishi Estate Co. Ltd. | 20500 | 258327 |
|  Mitsui Fudosan Co. Ltd. | 20500 | 393008 |
|  Mivne Real Estate KD Ltd.(a) | 14248 | 44531 |
|  Mobimo Holding AG (Registered) | 352 | 82130 |
|  Morguard Corp. | 1353 | 111083 |
|  New World Development Co. Ltd. | 33590 | 68722 |
|  Nexity SA(a) | 17179 | 344331 |
|  Nomura Real Estate Holdings, Inc. | 1400 | 31695 |
|  Norstar Holdings, Inc.(a) | 8106 | 42286 |
|  NP3 Fastigheter AB | 396 | 6293 |
|  Nyfosa AB | 2684 | 16018 |

---

*See Accompanying Notes to the Financial Statements.* 

222 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  OUE Ltd. | 90000 | $80136 |
|  PATRIZIA SE | 3248 | 23852 |
|  Platzer Fastigheter Holding AB, Class B | 3080 | 19092 |
|  Prashkovsky Investments and Construction Ltd.(a) | 1672 | 40352 |
|  Property & Building Corp. Ltd.\* (a) | 128 | 9532 |
|  PSP Swiss Property AG (Registered) | 531 | 56774 |
|  Relo Group, Inc. | 2270 | 32102 |
|  Sagax AB, Class B | 2420 | 44588 |
|  Samhallsbyggnadsbolaget i Norden AB(a) | 22748 | 31249 |
|  SAMTY Co. Ltd.(a) | 12600 | 199298 |
|  Savills plc | 7602 | 72252 |
|  Singapore Land Group Ltd. | 5656 | 8673 |
|  Sino Land Co. Ltd. | 69289 | 74057 |
|  Sirius Real Estate Ltd. | 65648 | 53287 |
|  Starts Corp., Inc. | 12300 | 217641 |
|  StorageVault Canada, Inc. | 7644 | 35024 |
|  Sumitomo Realty & Development Co. Ltd. | 11200 | 257328 |
|  Summit Real Estate Holdings Ltd. | 2418 | 33884 |
|  Sun Hung Kai Properties Ltd. | 34500 | 371157 |
|  Swire Pacific Ltd., Class A | 3500 | 23163 |
|  Swire Properties Ltd. | 24800 | 47642 |
|  Swiss Prime Site AG (Registered) | 1227 | 99067 |
|  TAG Immobilien AG | 5115 | 32077 |
|  Tokyo Tatemono Co. Ltd. | 5200 | 71684 |
|  Tokyu Fudosan Holdings Corp. | 11200 | 56891 |
|  Tricon Residential, Inc. | 4830 | 40650 |
|  UOL Group Ltd. | 6799 | 29741 |
|  VGP NV(a) | 176 | 13359 |
|  VIB Vermoegen AG | 271 | 5196 |
|  Vonovia SE | 11477 | 254090 |
|  Wallenstam AB, Class B | 8888 | 31352 |
|  Watkin Jones plc | 13596 | 14652 |
|  Wharf Real Estate Investment Co. Ltd. | 25000 | 98569 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Wihlborgs Fastigheter AB | 7304 | $| 47854 |
|  Wing Tai Holdings Ltd. | 24000 |  | 25779 |
|  YH Dimri Construction & Development Ltd.(a) | 452 |  | 27612 |
|  Zensun Enterprises Ltd.\* (a) | 144000 |  | 21279 |
|  |  |  | **8707687** |
| **Road & Rail – 1.5%** | **Road & Rail – 1.5%** | **Road & Rail – 1.5%** | **Road & Rail – 1.5%** |
|  Aurizon Holdings Ltd. | 31840 |  | 73704 |
|  Canadian National Railway Co. | 9061 |  | 1072135 |
|  Canadian Pacific Railway Ltd. | 13940 |  | 1037899 |
|  Central Japan Railway Co. | 2900 |  | 336856 |
|  ComfortDelGro Corp. Ltd. | 18400 |  | 16513 |
|  East Japan Railway Co. | 5500 |  | 297507 |
|  Firstgroup plc | 31646 |  | 38330 |
|  Fukuyama Transporting Co. Ltd. | 13300 |  | 290366 |
|  Hankyu Hanshin Holdings, Inc. | 4300 |  | 127726 |
|  Keikyu Corp. | 5700 |  | 58559 |
|  Keio Corp. | 1800 |  | 63215 |
|  Keisei Electric Railway Co. Ltd. | 2900 |  | 77068 |
|  Kelsian Group Ltd.(a) | 13288 |  | 39681 |
|  Kintetsu Group Holdings Co. Ltd. | 3900 |  | 131981 |
|  Kyushu Railway Co. | 2100 |  | 43940 |
|  MTR Corp. Ltd. | 25264 |  | 111196 |
|  Mullen Group Ltd.(a) | 30709 |  | 308205 |
|  Nagoya Railroad Co. Ltd. | 4400 |  | 67435 |
|  Nankai Electric Railway Co. Ltd. | 3000 |  | 60753 |
|  National Express Group plc\* | 17136 |  | 33382 |
|  Nikkon Holdings Co. Ltd. | 23100 |  | 361338 |
|  Nishi-Nippon Railroad Co. Ltd. | 5200 |  | 102121 |
|  NTG Nordic Transport Group A/S\* | 792 |  | 25760 |
|  Odakyu Electric Railway Co. Ltd. | 4600 |  | 54748 |
|  Redde Northgate plc | 73144 |  | 280434 |
|  Sakai Moving Service Co. Ltd. | 2900 |  | 91896 |
|  Sankyu, Inc. | 1333 |  | 39864 |
|  Seibu Holdings, Inc. | 2600 |  | 23300 |
|  Seino Holdings Co. Ltd. | 52300 |  | 402538 |
|  Senko Group Holdings Co. Ltd.(a) | 48700 |  | 325682 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 223

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  Sixt SE | 308 | $| 28919 |
|  Sixt SE (Preference) | 298 |  | 17377 |
|  Sotetsu Holdings, Inc.(a) | 4200 |  | 63663 |
|  Stef SA | 1230 |  | 97983 |
|  TFI International, Inc.(a) | 1517 |  | 137915 |
|  Tobu Railway Co. Ltd. | 4000 |  | 92576 |
|  Tokyu Corp. | 8300 |  | 95824 |
|  Trancom Co. Ltd.(a) | 1600 |  | 82134 |
|  West Japan Railway Co. | 4100 |  | 162775 |
|  |  |  | **6773298** |
| **Semiconductors & Semiconductor Equipment – 1.6%** | **Semiconductors & Semiconductor Equipment – 1.6%** | **Semiconductors & Semiconductor Equipment – 1.6%** | **Semiconductors & Semiconductor Equipment – 1.6%** |
|  Advantest Corp.(a) | 3100 |  | 163932 |
|  AEM Holdings Ltd. | 13200 |  | 29943 |
|  AIXTRON SE | 3108 |  | 76457 |
|  Alphawave IP Group plc\* (a) | 19492 |  | 25315 |
|  ams-OSRAM AG\* | 5984 |  | 33940 |
|  ASM International NV | 656 |  | 145751 |
|  ASML Holding NV | 5945 |  | 2808604 |
|  ASMPT Ltd. | 5000 |  | 27516 |
|  BE Semiconductor Industries NV | 1470 |  | 75143 |
|  Disco Corp.(a) | 400 |  | 96074 |
|  Ferrotec Holdings Corp.(a) | 14300 |  | 242639 |
|  Infineon Technologies AG | 20131 |  | 490249 |
|  Japan Material Co. Ltd. | 3900 |  | 51480 |
|  Lasertec Corp.(a) | 1300 |  | 186208 |
|  Megachips Corp. | 1000 |  | 17169 |
|  Melexis NV | 495 |  | 34148 |
|  Meyer Burger Technology AG\* (a) | 160380 |  | 76925 |
|  Mimasu Semiconductor Industry Co. Ltd. | 4600 |  | 71305 |
|  Nordic Semiconductor ASA\* | 3828 |  | 54087 |
|  Nova Ltd.\* | 352 |  | 25954 |
|  Optorun Co. Ltd. | 2900 |  | 41285 |
|  REC Silicon ASA\* | 22352 |  | 42955 |
|  Renesas Electronics Corp.\* | 22900 |  | 192047 |
|  Rohm Co. Ltd. | 1600 |  | 112706 |
|  Sanken Electric Co. Ltd. | 1600 |  | 55007 |
|  SCREEN Holdings Co. Ltd.(a) | 1100 |  | 60611 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  Shinko Electric Industries Co. Ltd.(a) | 1400 | $| 33767 |
|  Siltronic AG | 405 |  | 25238 |
|  SMA Solar Technology AG\* | 1100 |  | 53315 |
|  SOITEC\* | 528 |  | 67814 |
|  STMicroelectronics NV | 10168 |  | 317565 |
|  SUMCO Corp. | 5700 |  | 72441 |
|  Tokyo Electron Ltd. | 2500 |  | 664211 |
|  Tokyo Seimitsu Co. Ltd. | 13900 |  | 419427 |
|  Tower Semiconductor Ltd.\* | 2139 |  | 91893 |
|  Tri Chemical Laboratories, Inc. | 1800 |  | 26994 |
|  Ulvac, Inc. | 1000 |  | 39560 |
|  X-Fab Silicon Foundries SE\* (b) | 4400 |  | 22809 |
|  |  |  | **7072484** |
| **Software – 1.2%** | **Software – 1.2%** | **Software – 1.2%** | **Software – 1.2%** |
|  Altium Ltd.(a) | 1716 |  | 38855 |
|  Asseco Poland SA | 3212 |  | 46281 |
|  Atoss Software AG | 176 |  | 21465 |
|  AVEVA Group plc | 2332 |  | 83770 |
|  BlackBerry Ltd.\* | 8682 |  | 40290 |
|  BrainChip Holdings Ltd.\* (a) | 89100 |  | 36749 |
|  Bytes Technology Group plc | 10736 |  | 44400 |
|  Constellation Software, Inc. | 287 |  | 414470 |
|  Dassault Systemes SE | 10549 |  | 353966 |
|  Descartes Systems Group, Inc. (The)\* | 1375 |  | 94755 |
|  Digital Arts, Inc. | 1000 |  | 42184 |
|  Docebo, Inc.\* (a) | 1100 |  | 31942 |
|  Dye & Durham Ltd. | 3388 |  | 37431 |
|  Enghouse Systems Ltd. | 2552 |  | 56670 |
|  FD Technologies plc\* | 132 |  | 2043 |
|  Freee KK\* (a) | 1200 |  | 23494 |
|  Fuji Soft, Inc. | 700 |  | 38147 |
|  GB Group plc | 17999 |  | 78789 |
|  Hansen Technologies Ltd. | 15092 |  | 47577 |
|  Hilan Ltd. | 865 |  | 45517 |
|  IRESS Ltd.(a) | 6556 |  | 42551 |
|  Kape Technologies plc\* | 8536 |  | 21621 |
|  Kinaxis, Inc.\* (a) | 520 |  | 55433 |
|  Learning Technologies Group plc | 20240 |  | 25074 |
|  Lectra | 1188 |  | 38043 |

---

*See Accompanying Notes to the Financial Statements.* 

224 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Lightspeed Commerce, Inc.\* (a) | 2184 | $| 41805 |
|  LINK Mobility Group Holding ASA\* | 24552 |  | 19104 |
|  Magic Software Enterprises Ltd. | 2288 |  | 35742 |
|  Micro Focus International plc | 126854 |  | 759185 |
|  Money Forward, Inc.\* (a) | 1100 |  | 31379 |
|  Nemetschek SE | 884 |  | 42252 |
|  Netcompany Group A/S\* (a) (b) | 440 |  | 15106 |
|  Nice Ltd.\* | 985 |  | 187456 |
|  Open Text Corp. | 4346 |  | 125724 |
|  Oracle Corp. Japan | 800 |  | 42736 |
|  QT Group OYJ\* (a) | 308 |  | 13169 |
|  Rakus Co. Ltd. | 1600 |  | 17902 |
|  Sage Group plc (The) | 15375 |  | 128658 |
|  SAP SE | 15785 |  | 1523760 |
|  SimCorp A/S | 660 |  | 39429 |
|  Sinch AB\* (a) (b) | 7462 |  | 17554 |
|  Software AG | 2352 |  | 51560 |
|  Systena Corp. | 7600 |  | 21322 |
|  TeamViewer AG\* (c) | 8274 |  | 79601 |
|  Technology One Ltd. | 7884 |  | 60749 |
|  Temenos AG (Registered) | 1160 |  | 69200 |
|  TomTom NV\* (a) | 6776 |  | 53074 |
|  Trend Micro, Inc.(a) | 2500 |  | 126316 |
|  Truecaller AB, Class B\* (a) | 3168 |  | 11591 |
|  Vitec Software Group AB, Class B | 2332 |  | 85595 |
|  Vobile Group Ltd.\* (a) (b) | 46000 |  | 10958 |
|  WiseTech Global Ltd. | 3239 |  | 120460 |
|  WithSecure OYJ\* | 8140 |  | 13162 |
|  |  |  | **5506066** |
| **Specialty Retail – 1.5%** | **Specialty Retail – 1.5%** | **Specialty Retail – 1.5%** | **Specialty Retail – 1.5%** |
|  ABC-Mart, Inc. | 700 |  | 31224 |
|  Accent Group Ltd.(a) | 96883 |  | 91689 |
|  Alpen Co. Ltd. | 4600 |  | 62670 |
|  Aritzia, Inc.\* (a) | 1716 |  | 66474 |
|  Auto Partner SA(b) | 11382 |  | 27672 |
|  Autobacs Seven Co. Ltd.(a) | 26700 |  | 254183 |
|  Bic Camera, Inc.(a) | 8300 |  | 64609 |
|  Bilia AB, Class A | 22427 |  | 237453 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  CECONOMY AG | 60147 | $98027 |
|  City Chic Collective Ltd.\* (a) | 15004 | 12521 |
|  Clas Ohlson AB, Class B | 5460 | 36440 |
|  Currys plc(a) | 335380 | 251763 |
|  DCM Holdings Co. Ltd. | 39300 | 306447 |
|  Delek Automotive Systems Ltd. | 2436 | 31513 |
|  Dufry AG (Registered)\* | 1188 | 39186 |
|  Dunelm Group plc | 2604 | 25994 |
|  Eagers Automotive Ltd.(a) | 4180 | 33117 |
|  EDION Corp.(a) | 28700 | 228040 |
|  Fast Retailing Co. Ltd. | 1000 | 558348 |
|  Fenix Outdoor International AG(a) | 369 | 29986 |
|  Fielmann AG | 607 | 19354 |
|  Fnac Darty SA | 7093 | 219284 |
|  Fox Wizel Ltd. | 123 | 15063 |
|  Frasers Group plc\* | 4620 | 34442 |
|  H & M Hennes & Mauritz AB, Class B(a) | 10660 | 107271 |
|  Hikari Tsushin, Inc.(a) | 400 | 48360 |
|  Hornbach Holding AG & Co. KGaA | 3239 | 220887 |
|  IDOM, Inc. | 19600 | 98241 |
|  Industria de Diseno Textil SA(a) | 17220 | 390425 |
|  JB Hi-Fi Ltd.(a) | 1722 | 47250 |
|  JD Sports Fashion plc | 44135 | 49514 |
|  JINS Holdings, Inc. | 900 | 27127 |
|  Joyful Honda Co. Ltd.(a) | 18400 | 224561 |
|  Kid ASA(a) (b) | 11439 | 85708 |
|  Kingfisher plc | 41944 | 105712 |
|  Kohnan Shoji Co. Ltd.(a) | 9700 | 203286 |
|  Komeri Co. Ltd. | 12300 | 214744 |
|  K's Holdings Corp.(a) | 6100 | 47853 |
|  Leon's Furniture Ltd. | 9471 | 118383 |
|  Lovisa Holdings Ltd. | 6068 | 94676 |
|  Luk Fook Holdings International Ltd. | 97672 | 212270 |
|  Maisons du Monde SA(b) | 11521 | 112957 |
|  MEKO AB | 14965 | 141248 |
|  Musti Group OYJ\* | 2068 | 38875 |
|  Nextage Co. Ltd.(a) | 3200 | 61789 |
|  Nick Scali Ltd.(a) | 6996 | 45049 |
|  Nishimatsuya Chain Co. Ltd.(a) | 13600 | 124896 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 225

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Nitori Holdings Co. Ltd. | 1600 | $| 145699 |
|  Nojima Corp. | 24600 |  | 205228 |
|  Pet Valu Holdings Ltd. | 1716 |  | 46157 |
|  Pets at Home Group plc | 19950 |  | 66106 |
|  Premier Investments Ltd.(a) | 3036 |  | 48592 |
|  Sanrio Co. Ltd. | 2200 |  | 58687 |
|  Shimamura Co. Ltd. | 500 |  | 40468 |
|  Super Retail Group Ltd.(a) | 5324 |  | 34997 |
|  T-Gaia Corp.(a) | 9200 |  | 102439 |
|  USS Co. Ltd. | 1500 |  | 22676 |
|  Watches of Switzerland Group plc\* (c) | 3344 |  | 29819 |
|  WH Smith plc\* | 1408 |  | 19080 |
|  Yamada Holdings Co. Ltd. | 17300 |  | 55752 |
|  Yellow Hat Ltd. | 12500 |  | 150032 |
|  |  |  | **6622313** |
| **Technology Hardware, Storage & Peripherals – 0.5%** | **Technology Hardware, Storage & Peripherals – 0.5%** | **Technology Hardware, Storage & Peripherals – 0.5%** | **Technology Hardware, Storage & Peripherals – 0.5%** |
|  Brother Industries Ltd. | 3800 |  | 64707 |
|  Canon, Inc.(a) | 20500 |  | 435005 |
|  Eizo Corp. | 5600 |  | 136388 |
|  Elecom Co. Ltd. | 1600 |  | 14855 |
|  FUJIFILM Holdings Corp. | 6400 |  | 293616 |
|  Konica Minolta, Inc.(a) | 157700 |  | 480628 |
|  Logitech International SA (Registered) | 2899 |  | 144407 |
|  MCJ Co. Ltd.(a) | 24600 |  | 155576 |
|  Melco Holdings, Inc. | 2900 |  | 60971 |
|  Ricoh Co. Ltd. | 16800 |  | 123201 |
|  Riso Kagaku Corp.(a) | 1700 |  | 27072 |
|  Seiko Epson Corp. | 8200 |  | 111772 |
|  Toshiba TEC Corp. | 1100 |  | 28530 |
|  Wacom Co. Ltd. | 8800 |  | 38306 |
|  |  |  | **2115034** |
| **Textiles, Apparel & Luxury Goods – 1.5%** | **Textiles, Apparel & Luxury Goods – 1.5%** | **Textiles, Apparel & Luxury Goods – 1.5%** | **Textiles, Apparel & Luxury Goods – 1.5%** |
|  adidas AG | 2460 |  | 240654 |
|  Asics Corp. | 3400 |  | 52246 |
|  Brunello Cucinelli SpA | 660 |  | 38258 |
|  Burberry Group plc | 7175 |  | 149936 |
|  Canada Goose Holdings, Inc.\* | 2464 |  | 40264 |
|  Chow Sang Sang Holdings International Ltd. | 143000 |  | 131891 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** |
|  Cie Financiere Richemont SA (Registered) | 7995 | $| 782444 |
|  Coats Group plc | 98856 |  | 68860 |
|  Crystal International Group Ltd.(b) | 127500 |  | 32485 |
|  Delta Galil Industries Ltd. | 378 |  | 17184 |
|  Descente Ltd. | 1200 |  | 28903 |
|  Dr. Martens plc | 8536 |  | 24452 |
|  Gildan Activewear, Inc. | 2703 |  | 85189 |
|  Goldwin, Inc. | 1200 |  | 62812 |
|  Hermes International | 533 |  | 690359 |
|  HUGO BOSS AG | 1232 |  | 56791 |
|  Japan Wool Textile Co. Ltd. (The)(a) | 22900 |  | 153607 |
|  Kering SA | 1025 |  | 469755 |
|  LPP SA | 24 |  | 41699 |
|  LVMH Moet Hennessy Louis Vuitton SE | 3895 |  | 2459909 |
|  Marimekko OYJ | 2420 |  | 21837 |
|  Moncler SpA | 3444 |  | 148715 |
|  New Wave Group AB, Class B | 2552 |  | 35449 |
|  Pandora A/S | 1722 |  | 90780 |
|  Puma SE | 1640 |  | 72632 |
|  Samsonite International SA\* (a) (b) | 36900 |  | 79348 |
|  Seiren Co. Ltd.(a) | 3600 |  | 56506 |
|  Stella International Holdings Ltd. | 144000 |  | 139417 |
|  Swatch Group AG (The) | 451 |  | 101579 |
|  Swatch Group AG (The) (Registered) | 792 |  | 33113 |
|  Tod's SpA\* | 245 |  | 7642 |
|  Wacoal Holdings Corp. | 3900 |  | 62842 |
|  Yue Yuen Industrial Holdings Ltd. | 246000 |  | 250079 |
|  |  |  | **6727637** |
| **Thrifts & Mortgage Finance – 0.4%** | **Thrifts & Mortgage Finance – 0.4%** | **Thrifts & Mortgage Finance – 0.4%** | **Thrifts & Mortgage Finance – 0.4%** |
|  Aareal Bank AG | 2352 |  | 76758 |
|  Deutsche Pfandbriefbank AG(b) | 46002 |  | 343042 |
|  EQB, Inc.(a) | 6724 |  | 237993 |
|  First National Financial Corp. | 1452 |  | 36405 |

---

*See Accompanying Notes to the Financial Statements.* 

226 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** |
|  Genworth Mortgage Insurance Australia Ltd. | 128822 | $| 223237 |
|  Home Capital Group, Inc.(a) | 14309 |  | 276309 |
|  Liberty Financial Group Ltd.(a) (b) | 27280 |  | 62799 |
|  Mortgage Advice Bureau Holdings Ltd. | 2596 |  | 19249 |
|  OSB Group plc | 13068 |  | 62410 |
|  Paragon Banking Group plc | 80155 |  | 394986 |
|  Resimac Group Ltd.(a) | 26481 |  | 15155 |
|  |  |  | **1748343** |
| **Tobacco – 0.7%** | **Tobacco – 0.7%** | **Tobacco – 0.7%** | **Tobacco – 0.7%** |
|  British American Tobacco plc | 47232 |  | 1867157 |
|  Imperial Brands plc | 20459 |  | 500318 |
|  Japan Tobacco, Inc. | 24600 |  | 407807 |
|  Scandinavian Tobacco Group A/S(a) (b) | 17589 |  | 294919 |
|  Swedish Match AB | 25379 |  | 260899 |
|  |  |  | **3331100** |
| **Trading Companies & Distributors – 2.0%** | **Trading Companies & Distributors – 2.0%** | **Trading Companies & Distributors – 2.0%** | **Trading Companies & Distributors – 2.0%** |
|  AddTech AB, Class B | 4180 |  | 50536 |
|  Alligo AB, Class B | 3780 |  | 27879 |
|  Ashtead Group plc | 6601 |  | 345803 |
|  BayWa AG | 336 |  | 15160 |
|  Beijer Ref AB | 4576 |  | 70935 |
|  Bossard Holding AG (Registered), Class A | 220 |  | 43703 |
|  Brenntag SE | 2055 |  | 124788 |
|  Bufab AB | 968 |  | 18264 |
|  Bunzl plc | 5576 |  | 182390 |
|  Diploma plc | 1364 |  | 39041 |
|  Ferguson plc | 3567 |  | 390563 |
|  Finning International, Inc. | 2562 |  | 54412 |
|  Grafton Group plc | 5016 |  | 39849 |
|  Hanwa Co. Ltd. | 15100 |  | 365728 |
|  Howden Joinery Group plc | 11508 |  | 68104 |
|  IMCD NV | 984 |  | 127694 |
|  Inaba Denki Sangyo Co. Ltd. | 19900 |  | 371933 |
|  Inabata & Co. Ltd.(a) | 12500 |  | 206630 |
|  ITOCHU Corp.(a) | 30200 |  | 782049 |
|  Kanamoto Co. Ltd.(a) | 9323 |  | 134731 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** | **Trading Companies & Distributors – (continued)** |
|  Kanematsu Corp. | 28700 | $| 284036 |
|  Kloeckner & Co. SE | 28167 |  | 220901 |
|  Marubeni Corp. | 35800 |  | 313839 |
|  Mitsubishi Corp. | 30300 |  | 821740 |
|  Mitsui & Co. Ltd. | 35500 |  | 786500 |
|  MonotaRO Co. Ltd. | 5600 |  | 85450 |
|  Nagase & Co. Ltd.(a) | 39100 |  | 533487 |
|  Nippon Steel Trading Corp. | 4700 |  | 161900 |
|  Nishio Rent All Co. Ltd. | 8500 |  | 171104 |
|  OEM International AB, Class B | 25625 |  | 128004 |
|  Reece Ltd.(a) | 5999 |  | 59574 |
|  Rexel SA | 4641 |  | 83046 |
|  Richelieu Hardware Ltd. | 2684 |  | 71958 |
|  RS GROUP plc | 5808 |  | 64095 |
|  Russel Metals, Inc.(a) | 21812 |  | 451255 |
|  Scope Metals Group Ltd.(a) | 1968 |  | 88684 |
|  Seven Group Holdings Ltd. | 3036 |  | 35605 |
|  Sojitz Corp. | 2699 |  | 39840 |
|  Sumitomo Corp. | 26800 |  | 341773 |
|  Theme International Holdings Ltd.\* (a) | 1640000 |  | 156691 |
|  Thermador Groupe(a) | 396 |  | 32994 |
|  Toromont Industries Ltd. | 1599 |  | 122734 |
|  Toyota Tsusho Corp. | 5000 |  | 168197 |
|  Travis Perkins plc | 5412 |  | 51270 |
|  Trusco Nakayama Corp. | 1800 |  | 24160 |
|  Yamazen Corp. | 18600 |  | 115753 |
|  Yellow Cake plc\* (b) | 7602 |  | 37513 |
|  |  |  | **8912295** |
| **Transportation Infrastructure – 0.4%** | **Transportation Infrastructure – 0.4%** | **Transportation Infrastructure – 0.4%** | **Transportation Infrastructure – 0.4%** |
|  Aena SME SA\* (b) | 1025 |  | 120706 |
|  Aeroports de Paris\* | 555 |  | 75177 |
|  Atlantia SpA | 6273 |  | 139994 |
|  Atlas Arteria Ltd. | 13979 |  | 58907 |
|  Auckland International Airport Ltd.\* | 22332 |  | 99898 |
|  Dalrymple Bay Infrastructure Ltd.(a) | 60564 |  | 92559 |
|  Enav SpA(b) | 12657 |  | 48912 |
|  Flughafen Zurich AG (Registered)\* | 320 |  | 49691 |
|  Fraport AG Frankfurt Airport Services Worldwide\* | 890 |  | 34341 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 227

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** |
|  Getlink SE | 6888 | $| 109128 |
|  Hamburger Hafen und Logistik AG | 1220 |  | 14301 |
|  Japan Airport Terminal Co. Ltd.\* | 1200 |  | 51509 |
|  Kamigumi Co. Ltd. | 3100 |  | 58982 |
|  Mitsubishi Logistics Corp. | 1700 |  | 37343 |
|  Port of Tauranga Ltd. | 5225 |  | 19700 |
|  Qube Holdings Ltd. | 36652 |  | 63749 |
|  SATS Ltd.\* | 19000 |  | 36655 |
|  Sumitomo Warehouse Co. Ltd. (The)(a) | 24600 |  | 334157 |
|  Transurban Group | 46879 |  | 397492 |
|  Westshore Terminals Investment Corp. | 1647 |  | 29425 |
|  |  |  | **1872626** |
| **Water Utilities – 0.1%** | **Water Utilities – 0.1%** | **Water Utilities – 0.1%** | **Water Utilities – 0.1%** |
|  Pennon Group plc | 2970 |  | 28638 |
|  Severn Trent plc | 3854 |  | 111066 |
|  United Utilities Group plc | 10455 |  | 113079 |
|  |  |  | **252783** |
| **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** |
|  Airtel Africa plc(b) | 34804 |  | 45321 |
|  Freenet AG | 2198 |  | 43252 |
|  KDDI Corp. | 33900 |  | 1002392 |
|  Millicom International Cellular SA, SDR\* | 3036 |  | 32914 |
|  Okinawa Cellular Telephone Co. | 8200 |  | 155190 |
|  Orange Belgium SA\* | 1188 |  | 20125 |
|  Partner Communications Co. Ltd.\* | 6160 |  | 46644 |
|  Rogers Communications, Inc., Class B | 4797 |  | 199434 |
|  SoftBank Corp. | 57500 |  | 566934 |
|  SoftBank Group Corp.(a) | 17782 |  | 765666 |
|  Tele2 AB, Class B | 8052 |  | 65958 |
|  Vodafone Group plc | 578920 |  | 677471 |
|  |  |  | **3621301** |
| **Total Common Stocks <br>(Cost $462,207,051)** | **Total Common Stocks <br>(Cost $462,207,051)** |  | **435422178** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **CLOSED END FUNDS – 0.0%(f)** | **CLOSED END FUNDS – 0.0%(f)** | **CLOSED END FUNDS – 0.0%(f)** |
| **Independent Power and Renewable Electricity<br>Producers – 0.0%(f)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(f)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(f)** |
|  Renewables Infrastructure Group Ltd. (The) (Cost $50,126) | 34059 | $51056 |
|  | Number of<br>Rights |  |
| **RIGHTS – 0.0%** | **RIGHTS – 0.0%** | **RIGHTS – 0.0%** |
| **Real Estate Management & Development – 0.0%** | **Real Estate Management & Development – 0.0%** | **Real Estate Management & Development – 0.0%** |
|  S IMMO AG, expiring 12/31/2022, price 1.00 EUR\* ‡<br>(Cost $–) | 2564 |  |
|  | Number of<br>Warrants |  |
| **WARRANTS – 0.0%** | **WARRANTS – 0.0%** | **WARRANTS – 0.0%** |
| **Construction & Engineering – 0.0%** | **Construction & Engineering – 0.0%** | **Construction & Engineering – 0.0%** |
|  Webuild SpA, expiring 8/2/2030\* ‡ (a)<br>(Cost $–) | 10785 |  |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(g) – 1.7%** | **SECURITIES LENDING REINVESTMENTS(g) – 1.7%** | **SECURITIES LENDING REINVESTMENTS(g) – 1.7%** |
| **REPURCHASE AGREEMENTS – 1.7%** | **REPURCHASE AGREEMENTS – 1.7%** | **REPURCHASE AGREEMENTS – 1.7%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $4,212,026, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 –1/15/2029; total market value $4,241,589 | $4211675 | 4211675 |

---

*See Accompanying Notes to the Financial Statements.* 

228 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **SECURITIES LENDING REINVESTMENTS – (continued)** | **SECURITIES LENDING REINVESTMENTS – (continued)** | **SECURITIES LENDING REINVESTMENTS – (continued)** | **SECURITIES LENDING REINVESTMENTS – (continued)** |
| **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $3,001,791, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $3,041,106 | $| 3000000 | $3000000 |
|  TD Prime Services LLC, 3.15%, dated 10/31/2022, due 11/1/2022, repurchase price $379,427, collateralized by various Common Stocks; total market value $414,926 |  | 379394 | 379394 |
|  |  |  | **7591069** |
| **Total Securities Lending Reinvestments <br>(Cost $7,591,069)** | **Total Securities Lending Reinvestments <br>(Cost $7,591,069)** | **Total Securities Lending Reinvestments <br>(Cost $7,591,069)** | **7591069** |
| **Total Investments – 99.2% <br>(Cost $469,848,246)** | **Total Investments – 99.2% <br>(Cost $469,848,246)** | **Total Investments – 99.2% <br>(Cost $469,848,246)** | **443064303** |
|  Other assets less liabilities – 0.8% | Other assets less liabilities – 0.8% | Other assets less liabilities – 0.8% | 3689877 |
| **Net Assets –100.0%** | **Net Assets –100.0%** | **Net Assets –100.0%** | $**446754180** |

---

*\** *Non-income producing security.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $52,637,337 collateralized in the form of cash with a value of $7,591,069 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $36,234,872 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $13,323,302 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from November 22, 2022 – June 30, 2120; a total value of $57,149,242.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(d)</sup>* *Amount represents less than one share.* 

*<sup>(e)</sup>* *Amount less than one dollar.* 

*<sup>(f)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(g)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $7,591,069.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*CHDI – Clearing House Electronic Subregister System (CHESS) Depository Interest* 

*CVA – Dutch Certification* 

*OYJ – Public Limited Company* 

*Preference A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*SCA – Limited partnership with share capital* 

*SDR – Swedish Depositary Receipt* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $55570251 |
|  Aggregate gross unrealized depreciation | (85682456) |
|  Net unrealized depreciation | $(30112205) |
|  Federal income tax cost | $473187236 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 229

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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**Futures Contracts** 

*FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading <br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  EURO STOXX 50 Index | 86 | 12/16/2022 | EUR | $3075231 | $60380 |
|  FTSE 100 Index | 27 | 12/16/2022 | GBP | 2209470 | (63678) |
|  Nikkei 225 Index | 31 | 12/08/2022 | JPY | 2870892 | 32157 |
|  S&P/TSX 60 Index | 10 | 12/15/2022 | CAD | 1726623 | 31256 |
|  SPI 200 Index | 10 | 12/15/2022 | AUD | 1096017 | 2103 |
|  |  |  |  |  | $62218 |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  GBP | 823203 | Bank of New York | USD | 939015 | 12/21/2022 | $10447 |
|  USD | 345031 | Citibank NA | CHF | 330788 | 12/21/2022 | 12446 |
|  USD | 24111 | Morgan Stanley | DKK | 178253 | 12/21/2022 | 343 |
|  USD | 737252 | Bank of Montreal | JPY | 105750000 | 12/21/2022 | 21128 |
|  USD | 422945 | Citibank NA | NZD | 711055 | 12/21/2022 | 9532 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $53896 |
|  AUD | 1388017 | Morgan Stanley | USD | 929337 | 12/21/2022 | $(40306) |
|  CAD | 1004150 | Toronto-Dominion Bank (The) | USD | 754364 | 12/21/2022 | (17775) |
|  EUR | 467687 | Morgan Stanley | USD | 470236 | 12/21/2022 | (6045) |
|  HKD | 362598 | Goldman Sachs & Co. | USD | 46267 | 12/21/2022 | (46) |
|  ILS | 366970 | BNP Paribas SA | USD | 107172 | 12/21/2022 | (2464) |
|  JPY | 100430889 | Bank of New York | USD | 708013 | 12/21/2022 | (27909) |
|  NOK | 1450557 | Morgan Stanley | USD | 141154 | 12/21/2022 | (1386) |
|  SEK | 4244576 | Morgan Stanley | USD | 394731 | 12/21/2022 | (8967) |
|  SGD | 143900 | JPMorgan Chase Bank | USD | 102208 | 12/21/2022 | (488) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(105386) |
|  Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | $(51490) |

---

*See Accompanying Notes to the Financial Statements.* 

230 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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*Abbreviations:* 

*AUD – Australian Dollar* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*DKK – Danish Krone* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*ILS – Israeli Shekel* 

*JPY – Japanese Yen* 

*NOK – Norwegian Krone* 

*NZD – New Zealand Dollar* 

*SEK – Swedish Krona* 

*SGD – Singapore Dollar* 

*USD – US Dollar* 

*FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Australia | 6.0% |
|  Austria | 0.2 |
|  Belgium | 0.9 |
|  Canada | 11.2 |
|  Denmark | 1.9 |
|  Finland | 0.8 |
|  France | 7.4 |
|  Germany | 5.2 |
|  Hong Kong | 2.1 |
|  Ireland | 0.2 |
|  Israel | 1.1 |
|  Italy | 2.2 |
|  Japan | 27.7 |
|  Netherlands | 2.8 |
|  New Zealand | 0.3 |
|  Norway | 1.3 |
|  Poland | 0.4 |
|  Portugal | 0.3 |
|  Singapore | 1.4 |
|  Spain | 2.0 |
|  Sweden | 3.1 |
|  Switzerland | 5.8 |
|  United Kingdom | 13.1 |
|  United States | 0.1 |
|  Other<sup>1</sup> | 2.5 |
|  | 100.0% |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 231

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FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Security Type | % of Net Assets |  |
|  Common Stocks | 97.5 | % |
|  Closed End Funds | 0.0 | † |
|  Rights |  |  |
|  Warrants |  |  |
|  Securities Lending Reinvestments | 1.7 |  |
|  Others<sup>(1)</sup> | 0.8 |  |
|  | 100.0 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

232 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.5%** | **COMMON STOCKS – 99.5%** | **COMMON STOCKS – 99.5%** |
| **Aerospace & Defense – 0.2%** | **Aerospace & Defense – 0.2%** | **Aerospace & Defense – 0.2%** |
|  AECC Aero-Engine Control Co. Ltd., Class A | 5000 | $20552 |
|  AECC Aviation Power Co. Ltd., Class A | 4700 | 31322 |
|  Aselsan Elektronik Sanayi ve Ticaret A/S | 6972 | 12075 |
|  AVIC Electromechanical Systems Co. Ltd., Class A | 5300 | 8496 |
|  AviChina Industry & Technology Co. Ltd., Class H(a) | 81000 | 35496 |
|  Bharat Dynamics Ltd.(b) | 1587 | 18371 |
|  Bharat Electronics Ltd. | 72030 | 92977 |
|  Embraer SA\* | 16500 | 43237 |
|  Hanwha Aerospace Co. Ltd. | 882 | 41052 |
|  Hanwha Systems Co. Ltd. | 689 | 5393 |
|  Hindustan Aeronautics Ltd.(b) | 1708 | 52204 |
|  Korea Aerospace Industries Ltd. | 1576 | 52388 |
|  Kuang-Chi Technologies Co. Ltd., Class A\* | 5600 | 13274 |
|  LIG Nex1 Co. Ltd. | 250 | 17814 |
|  United Aircraft Corp. PJSC\* ‡ | 25155036 |  |
|  |  | **444651** |
| **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** |
|  Agility Public Warehousing Co. KSC | 27701 | 70113 |
|  Allcargo Logistics Ltd. | 1900 | 9933 |
|  Aramex PJSC | 32940 | 32554 |
|  Blue Dart Express Ltd. | 265 | 24289 |
|  Dimerco Express Corp. | 49000 | 94130 |
|  Hanjin Transportation Co. Ltd. | 2940 | 39834 |
|  Hyundai Glovis Co. Ltd. | 686 | 83797 |
|  JD Logistics, Inc.\* (b) | 29400 | 41048 |
|  Kerry Express Thailand PCL, NVDR\* | 38500 | 17803 |
|  Kerry TJ Logistics Co. Ltd. | 8000 | 8665 |
|  SF Holding Co. Ltd., Class A | 7100 | 46947 |
|  Sindhu Trade Links Ltd.\* | 153489 | 36436 |
|  Sinotrans Ltd., Class A | 23500 | 11430 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** | **Air Freight & Logistics – (continued)** |
|  Sinotrans Ltd., Class H | 83000 | $| 20195 |
|  T3EX Global Holdings Corp. | 49000 |  | 92305 |
|  YTO Express Group Co. Ltd., Class A | 4700 |  | 12145 |
|  Yunda Holding Co. Ltd., Class A | 5800 |  | 10474 |
|  ZTO Express Cayman, Inc. | 7350 |  | 123501 |
|  |  |  | **775599** |
| **Airlines – 0.4%** | **Airlines – 0.4%** | **Airlines – 0.4%** | **Airlines – 0.4%** |
|  Aeroflot PJSC\* ‡ | 74029 |  |  |
|  Air Arabia PJSC | 100646 |  | 55899 |
|  Azul SA (Preference)\* | 11700 |  | 35966 |
|  China Airlines Ltd. | 61000 |  | 32088 |
|  China Eastern Airlines Corp. Ltd., Class A\* | 14300 |  | 9405 |
|  China Eastern Airlines Corp. Ltd., Class H\* (a) | 46000 |  | 15177 |
|  China Southern Airlines Co. Ltd., Class A\* | 14100 |  | 12480 |
|  China Southern Airlines Co. Ltd., Class H\* (a) | 24000 |  | 12382 |
|  Controladora Vuela Cia de Aviacion SAB de CV, Class A\* (a) | 36400 |  | 30882 |
|  Eva Airways Corp. | 52798 |  | 38342 |
|  Gol Linhas Aereas Inteligentes SA (Preference)\* | 10600 |  | 19413 |
|  Hanjin Kal Corp.\* | 273 |  | 7628 |
|  InterGlobe Aviation Ltd.\* (b) | 1875 |  | 40357 |
|  Jazeera Airways Co. KSCP | 2338 |  | 12613 |
|  Jeju Air Co. Ltd.\* | 1962 |  | 13732 |
|  Jin Air Co. Ltd.\* | 658 |  | 6074 |
|  Korean Air Lines Co. Ltd.\* | 3339 |  | 54148 |
|  Pegasus Hava Tasimaciligi A/S\* | 14431 |  | 248392 |
|  Turk Hava Yollari AO\* | 19635 |  | 106920 |
|  |  |  | **751898** |
| **Auto Components – 1.0%** | **Auto Components – 1.0%** | **Auto Components – 1.0%** | **Auto Components – 1.0%** |
|  Apollo Tyres Ltd. | 11319 |  | 39750 |
|  Asahi India Glass Ltd. | 4900 |  | 36455 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 233

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** |
|  Balkrishna Industries Ltd. | 1715 | $40665 |
|  Bharat Forge Ltd. | 5771 | 58158 |
|  Bosch Ltd. | 204 | 40635 |
|  Cheng Shin Rubber Industry Co. Ltd. | 49000 | 49118 |
|  DN Automotive Corp. | 1519 | 61850 |
|  Endurance Technologies Ltd.(b) | 350 | 5726 |
|  Exide Industries Ltd. | 15150 | 30336 |
|  Fuyao Glass Industry Group Co. Ltd., Class A | 4800 | 21986 |
|  Fuyao Glass Industry Group Co. Ltd., Class H(b) | 8400 | 30123 |
|  Hankook & Co. Co Ltd. | 907 | 8182 |
|  Hankook Tire & Technology Co. Ltd. | 2492 | 63942 |
|  Hanon Systems | 2756 | 15091 |
|  HL Mando Co. Ltd. | 1089 | 37805 |
|  Hota Industrial Manufacturing Co. Ltd. | 12134 | 28167 |
|  Huayu Automotive Systems Co. Ltd., Class A | 9400 | 21598 |
|  Hyundai Mobis Co. Ltd. | 1989 | 305796 |
|  Hyundai Wia Corp. | 583 | 25007 |
|  Iljin Hysolus Co. Ltd.\* | 383 | 8201 |
|  Kenda Rubber Industrial Co. Ltd. | 37000 | 35079 |
|  Kordsa Teknik Tekstil A/S | 22834 | 78679 |
|  Kumho Tire Co., Inc.\* | 1 | 2 |
|  Minth Group Ltd. | 12000 | 23695 |
|  Motherson Sumi Wiring India Ltd. | 21519 | 22747 |
|  MRF Ltd. | 38 | 41668 |
|  Myoung Shin Industrial Co. Ltd.\* | 1250 | 15137 |
|  Nan Kang Rubber Tire Co. Ltd.\* | 14000 | 14837 |
|  Nexen Tire Corp. | 13049 | 70721 |
|  Nexteer Automotive Group Ltd.(a) | 343000 | 185704 |
|  Ningbo Tuopu Group Co. Ltd., Class A | 1200 | 10654 |
|  Samvardhana Motherson International Ltd. | 39996 | 31165 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** |
|  Sebang Global Battery Co. Ltd. | 81 | $| 2215 |
|  Shandong Linglong Tyre Co. Ltd., Class A | 5500 |  | 12336 |
|  SL Corp. | 550 |  | 11873 |
|  SNT Motiv Co. Ltd. | 3038 |  | 94161 |
|  Sona Blw Precision Forgings Ltd.(b) | 2550 |  | 14337 |
|  Sundram Fasteners Ltd. | 2951 |  | 33384 |
|  Tianneng Power International Ltd.(a) | 262000 |  | 251992 |
|  Tong Yang Industry Co. Ltd. | 19000 |  | 26682 |
|  Tube Investments of India Ltd. | 1715 |  | 56835 |
|  Tung Thih Electronic Co. Ltd. | 1000 |  | 4159 |
|  UNO Minda Ltd. | 3740 |  | 24249 |
|  Weifu High-Technology Group Co. Ltd., Class A | 4700 |  | 11083 |
|  ZF Commercial Vehicle Control Systems India Ltd. | 250 |  | 30892 |
|  |  |  | **2032877** |
| **Automobiles – 2.2%** | **Automobiles – 2.2%** | **Automobiles – 2.2%** | **Automobiles – 2.2%** |
|  Astra International Tbk. PT | 627200 |  | 267407 |
|  Bajaj Auto Ltd. | 1151 |  | 51056 |
|  BYD Co. Ltd., Class A | 2600 |  | 87872 |
|  BYD Co. Ltd., Class H | 15000 |  | 335739 |
|  China Motor Corp. | 5400 |  | 6997 |
|  Chongqing Changan Automobile Co. Ltd., Class A | 17108 |  | 26464 |
|  Chongqing Changan Automobile Co. Ltd., Class B | 6890 |  | 2984 |
|  Dongfeng Motor Group Co. Ltd., Class H | 976000 |  | 441384 |
|  DRB-Hicom Bhd. | 352800 |  | 99990 |
|  Eicher Motors Ltd. | 2470 |  | 114894 |
|  Ford Otomotiv Sanayi A/S | 1736 |  | 33875 |
|  Geely Automobile Holdings Ltd.(a) | 98000 |  | 105368 |
|  Great Wall Motor Co. Ltd., Class A | 4700 |  | 18778 |
|  Great Wall Motor Co. Ltd., Class H | 49000 |  | 53495 |
|  Guangzhou Automobile Group Co. Ltd., Class A | 13500 |  | 20957 |

---

*See Accompanying Notes to the Financial Statements.* 

234 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** |
|  Guangzhou Automobile Group Co. Ltd., Class H | 64000 | $| 38971 |
|  Hero MotoCorp Ltd. | 2107 |  | 68136 |
|  Hyundai Motor Co. | 4116 |  | 475329 |
|  Hyundai Motor Co. (2nd Preference) | 1127 |  | 63136 |
|  Hyundai Motor Co. (3rd Preference) | 54 |  | 2855 |
|  Hyundai Motor Co. (Preference) | 676 |  | 37206 |
|  Kia Corp. | 7894 |  | 367421 |
|  Li Auto, Inc., Class A\* (a) | 19600 |  | 133707 |
|  Mahindra & Mahindra Ltd. | 15778 |  | 257053 |
|  Maruti Suzuki India Ltd. | 2205 |  | 253793 |
|  NIO, Inc., Class A\* | 24500 |  | 233457 |
|  Oriental Holdings Bhd. | 8500 |  | 11973 |
|  SAIC Motor Corp. Ltd., Class A | 24500 |  | 46156 |
|  Sanyang Motor Co. Ltd. | 236000 |  | 265864 |
|  Tata Motors Ltd.\* | 31767 |  | 158398 |
|  Tata Motors Ltd., Class A\* | 8230 |  | 23384 |
|  Tofas Turk Otomobil Fabrikasi A/S | 3233 |  | 17101 |
|  TVS Motor Co. Ltd. | 3493 |  | 48360 |
|  UMW Holdings Bhd. | 216600 |  | 153471 |
|  XPeng, Inc., Class A\* (a) | 19600 |  | 63420 |
|  Yadea Group Holdings Ltd.(b) | 16000 |  | 24418 |
|  Yulon Motor Co. Ltd. | 26986 |  | 38190 |
|  |  |  | **4449059** |
| **Banks – 13.9%** | **Banks – 13.9%** | **Banks – 13.9%** | **Banks – 13.9%** |
|  Absa Group Ltd. | 23863 |  | 259360 |
|  Abu Dhabi Commercial Bank PJSC | 83928 |  | 215929 |
|  Abu Dhabi Islamic Bank PJSC | 23694 |  | 61282 |
|  AFFIN Bank Bhd. | 31038 |  | 14705 |
|  Agricultural Bank of China Ltd., Class A | 393100 |  | 148653 |
|  Agricultural Bank of China Ltd., Class H | 915000 |  | 261101 |
|  Ahli United Bank KSCP | 8800 |  | 7585 |
|  Akbank TAS, ADR | 46845 |  | 71439 |
|  Al Ahli Bank of Kuwait KSCP | 9527 |  | 10181 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Al Rajhi Bank\* | 34104 | $773286 |
|  Alinma Bank | 15813 | 157812 |
|  Alliance Bank Malaysia Bhd. | 27600 | 21599 |
|  Alpha Services and Holdings SA\* | 63014 | 58419 |
|  AMMB Holdings Bhd. | 73500 | 63582 |
|  AU Small Finance Bank Ltd.(b) | 4998 | 35596 |
|  Axis Bank Ltd. | 37583 | 411346 |
|  Banco Bradesco SA\* | 45600 | 144606 |
|  Banco Bradesco SA (Preference) | 161942 | 612925 |
|  Banco Davivienda SA (Preference) | 43022 | 229065 |
|  Banco de Bogota SA | 3242 | 17262 |
|  Banco de Chile | 1373176 | 125545 |
|  Banco de Credito e Inversiones SA | 1670 | 46518 |
|  Banco del Bajio SA(a) (b) | 28373 | 79877 |
|  Banco do Brasil SA | 44100 | 311131 |
|  Banco do Estado do Rio Grande do Sul SA (Preference), Class B | 73500 | 163466 |
|  Banco Pan SA (Preference) | 10600 | 15615 |
|  Banco Santander Chile | 1891547 | 67740 |
|  Bancolombia SA | 8820 | 64120 |
|  Bancolombia SA (Preference) | 13747 | 87974 |
|  Bandhan Bank Ltd.\* (b) | 12381 | 35680 |
|  Bangkok Bank PCL, NVDR | 15000 | 57344 |
|  Bank Al Habib Ltd. | 403172 | 97072 |
|  Bank AlBilad\* | 8364 | 112854 |
|  Bank Al-Jazira | 6066 | 37743 |
|  Bank Central Asia Tbk. PT | 960400 | 541851 |
|  Bank Ina Perdana PT\* | 70500 | 17718 |
|  Bank Jago Tbk. PT\* | 75000 | 24523 |
|  Bank Mandiri Persero Tbk. PT | 646800 | 437489 |
|  Bank Negara Indonesia Persero Tbk. PT | 230300 | 138793 |
|  Bank OCBC Nisp Tbk. PT | 1269100 | 61024 |
|  Bank of Ayudhya PCL, NVDR | 70000 | 58395 |
|  Bank of Baroda | 31698 | 56559 |
|  Bank of Beijing Co. Ltd., Class A | 70000 | 38747 |
|  Bank of Changsha Co. Ltd., Class A | 9400 | 8294 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 235

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Bank of Chengdu Co. Ltd., Class A | 10600 | $19781 |
|  Bank of China Ltd., Class A | 200900 | 82853 |
|  Bank of China Ltd., Class H | 2352000 | 758048 |
|  Bank of Chongqing Co. Ltd., Class H | 220500 | 99999 |
|  Bank of Communications Co. Ltd., Class A | 102100 | 62251 |
|  Bank of Communications Co. Ltd., Class H | 638000 | 311285 |
|  Bank of Hangzhou Co. Ltd., Class A | 18800 | 31193 |
|  Bank of India | 5936 | 4321 |
|  Bank of Jiangsu Co. Ltd., Class A | 42580 | 40371 |
|  Bank of Nanjing Co. Ltd., Class A | 31200 | 44116 |
|  Bank of Ningbo Co. Ltd., Class A | 16350 | 53226 |
|  Bank of Qingdao Co. Ltd., Class H(b) | 220500 | 68539 |
|  Bank of Shanghai Co. Ltd., Class A | 45000 | 34404 |
|  Bank of the Philippine Islands | 23710 | 39278 |
|  Bank of Zhengzhou Co. Ltd., Class A\* | 17490 | 5464 |
|  Bank Pan Indonesia Tbk. PT | 71500 | 11002 |
|  Bank Pembangunan Daerah Jawa Barat Dan Banten Tbk. PT | 2146200 | 189199 |
|  Bank Pembangunan Daerah Jawa Timur Tbk. PT | 918000 | 41493 |
|  Bank Rakyat Indonesia Persero Tbk. PT | 1185800 | 353516 |
|  Bank Tabungan Negara Persero Tbk. PT | 1700000 | 168392 |
|  Banque Saudi Fransi | 10613 | 122016 |
|  BDO Unibank, Inc. | 51940 | 114098 |
|  BNK Financial Group, Inc. | 10830 | 48735 |
|  BOC Hong Kong Holdings Ltd. | 98000 | 304617 |
|  Boubyan Bank KSCP | 19922 | 52997 |
|  Burgan Bank SAK | 30004 | 21117 |
|  Canara Bank | 14791 | 51890 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Capitec Bank Holdings Ltd. | 1688 | $174570 |
|  Chang Hwa Commercial Bank Ltd. | 114919 | 59203 |
|  China Bohai Bank Co. Ltd., Class H(a) (b) | 1245500 | 153905 |
|  China CITIC Bank Corp. Ltd., Class H | 245000 | 92384 |
|  China Construction Bank Corp., Class A | 28200 | 20632 |
|  China Construction Bank Corp., Class H | 2891000 | 1535758 |
|  China Everbright Bank Co. Ltd., Class A | 117600 | 43826 |
|  China Everbright Bank Co. Ltd., Class H | 53000 | 13706 |
|  China Merchants Bank Co. Ltd., Class A | 49000 | 180059 |
|  China Merchants Bank Co. Ltd., Class H | 98000 | 322095 |
|  China Minsheng Banking Corp. Ltd., Class A | 83300 | 37663 |
|  China Minsheng Banking Corp. Ltd., Class H(a) | 196000 | 56928 |
|  China Zheshang Bank Co. Ltd., Class A\* | 47000 | 17773 |
|  China Zheshang Bank Co. Ltd., Class H\* (a) | 53000 | 18297 |
|  Chongqing Rural Commercial Bank Co. Ltd., Class A | 18800 | 8990 |
|  Chongqing Rural Commercial Bank Co. Ltd., Class H | 94000 | 28500 |
|  CIMB Group Holdings Bhd. | 208040 | 242889 |
|  City Union Bank Ltd. | 9675 | 21740 |
|  Commercial Bank PSQC (The) | 59417 | 102690 |
|  Commercial International Bank Egypt SAE | 81677 | 109579 |
|  Credicorp Ltd. | 2009 | 294037 |
|  Credit Agricole Egypt SAE | 236999 | 67910 |
|  Credit Bank of Moscow PJSC\* ‡ | 229590 |  |
|  CTBC Financial Holding Co. Ltd. | 588000 | 372262 |
|  DGB Financial Group, Inc. | 7200 | 34321 |
|  Doha Bank QPSC | 591986 | 358597 |

---

*See Accompanying Notes to the Financial Statements.* 

236 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Dubai Islamic Bank PJSC | 84425 | $133773 |
|  E.Sun Financial Holding Co. Ltd. | 245179 | 176527 |
|  Emirates NBD Bank PJSC | 72520 | 261605 |
|  Eurobank Ergasias Services and Holdings SA\* | 81242 | 80296 |
|  Faisal Islamic Bank of Egypt | 46688 | 44447 |
|  Far Eastern International Bank | 65617 | 21586 |
|  Federal Bank Ltd. | 30426 | 48335 |
|  First Abu Dhabi Bank PJSC | 77031 | 375398 |
|  First Financial Holding Co. Ltd. | 190172 | 146071 |
|  Grupo Aval Acciones y Valores SA (Preference) | 142166 | 15721 |
|  Grupo Bolivar SA | 1518 | 17377 |
|  Grupo Elektra SAB de CV | 980 | 49083 |
|  Grupo Financiero Banorte SAB de CV, Class O | 73500 | 596361 |
|  Grupo Financiero Inbursa SAB de CV, Class O\* (a) | 28946 | 53330 |
|  Gulf Bank KSCP | 44835 | 49648 |
|  Habib Bank Ltd. | 304952 | 96491 |
|  Haci Omer Sabanci Holding A/S | 31455 | 56712 |
|  Hana Financial Group, Inc. | 8330 | 241225 |
|  Hong Leong Bank Bhd. | 14300 | 63999 |
|  Hong Leong Financial Group Bhd. | 9800 | 39548 |
|  Hua Nan Financial Holdings Co. Ltd. | 161065 | 105219 |
|  Huaxia Bank Co. Ltd., Class A | 47000 | 30846 |
|  ICICI Bank Ltd. | 87563 | 961233 |
|  IDFC First Bank Ltd.\* | 61957 | 41990 |
|  Indian Bank | 7425 | 22774 |
|  IndusInd Bank Ltd. | 9523 | 131454 |
|  Industrial & Commercial Bank of China Ltd., Class A | 254800 | 144880 |
|  Industrial & Commercial Bank of China Ltd., Class H | 2107000 | 915288 |
|  Industrial Bank Co. Ltd., Class A | 53900 | 110996 |
|  Industrial Bank of Korea | 9751 | 71535 |
|  Intercorp Financial Services, Inc. | 1040 | 25480 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Itau CorpBanca Chile SA | 10585840 | $20637 |
|  Itau Unibanco Holding SA (Preference)\* | 142100 | 823258 |
|  Itausa SA | 26514 | 54673 |
|  Itausa SA (Preference) | 144300 | 295351 |
|  JB Financial Group Co. Ltd. | 3370 | 16987 |
|  Jiangsu Changshu Rural Commercial Bank Co. Ltd., Class A | 6700 | 6408 |
|  KakaoBank Corp.\* | 5243 | 62940 |
|  Kasikornbank PCL, NVDR | 35800 | 137331 |
|  KB Financial Group, Inc. | 11662 | 393386 |
|  Kiatnakin Phatra Bank PCL, NVDR | 9800 | 18797 |
|  King's Town Bank Co. Ltd. | 24000 | 22866 |
|  Komercni Banka A/S | 1272 | 36485 |
|  Kotak Mahindra Bank Ltd. | 18369 | 422058 |
|  Krung Thai Bank PCL, NVDR | 112400 | 51682 |
|  Kuwait Finance House KSCP | 133770 | 349810 |
|  Kuwait International Bank KSCP | 26655 | 16264 |
|  Kuwait Projects Co. Holding KSCP | 22000 | 8381 |
|  Malayan Banking Bhd. | 209700 | 380990 |
|  Malaysia Building Society Bhd. | 119217 | 14877 |
|  Masraf Al Rayan QSC | 108432 | 114245 |
|  MCB Bank Ltd. | 151508 | 83641 |
|  Mega Financial Holding Co. Ltd. | 186775 | 173313 |
|  Metropolitan Bank & Trust Co. | 48620 | 43376 |
|  Moneta Money Bank A/S(b) | 17993 | 52518 |
|  National Bank of Greece SA\* | 13715 | 49748 |
|  National Bank of Kuwait SAKP | 125370 | 436316 |
|  Nedbank Group Ltd. | 13981 | 165513 |
|  O-Bank Co. Ltd. | 106000 | 26120 |
|  OTP Bank Nyrt. | 6713 | 146101 |
|  Ping An Bank Co. Ltd., Class A | 47100 | 66727 |
|  Piraeus Financial Holdings SA\* | 28658 | 35349 |
|  Postal Savings Bank of China Co. Ltd., Class A | 97999 | 52097 |
|  Postal Savings Bank of China Co. Ltd., Class H(a) (b) | 196000 | 90886 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 237

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Public Bank Bhd. | 256600 | $242598 |
|  Punjab National Bank | 43248 | 22283 |
|  Qatar International Islamic Bank QSC | 14896 | 47325 |
|  Qatar Islamic Bank SAQ | 26407 | 176856 |
|  Qatar National Bank QPSC | 77939 | 426746 |
|  Qingdao Rural Commercial Bank Corp., Class A | 18800 | 7135 |
|  RBL Bank Ltd.\* (b) | 168340 | 274847 |
|  Regional SAB de CV | 5500 | 38366 |
|  RHB Bank Bhd. | 101959 | 123351 |
|  Riyad Bank | 24217 | 231694 |
|  Rizal Commercial Banking Corp. | 275000 | 107722 |
|  Saudi British Bank (The) | 6958 | 80551 |
|  Saudi Investment Bank (The) | 8484 | 40957 |
|  Saudi National Bank (The) | 37599 | 594371 |
|  Sberbank of Russia PJSC\* ‡ | 369050 |  |
|  Sberbank of Russia PJSC (Preference)\* ‡ | 39708 |  |
|  SCB X PCL, NVDR | 30500 | 84945 |
|  Security Bank Corp. | 116810 | 174157 |
|  Shanghai Commercial & Savings Bank Ltd. (The) | 126000 | 181438 |
|  Shanghai Pudong Development Bank Co. Ltd., Class A | 73500 | 66868 |
|  Shinhan Financial Group Co. Ltd. | 15386 | 392089 |
|  SinoPac Financial Holdings Co. Ltd. | 346640 | 173199 |
|  Standard Bank Group Ltd. | 40755 | 380661 |
|  State Bank of India | 51437 | 356553 |
|  Sunrisemezz plc\* | 4094 | 331 |
|  Taichung Commercial Bank Co. Ltd. | 50000 | 19474 |
|  Taishin Financial Holding Co. Ltd. | 355315 | 146107 |
|  Taiwan Business Bank | 90107 | 33417 |
|  Taiwan Cooperative Financial Holding Co. Ltd. | 196000 | 152068 |
|  Thanachart Capital PCL, NVDR | 19300 | 20284 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Tisco Financial Group PCL, NVDR | 11200 | $| 28250 |
|  TMBThanachart Bank PCL, NVDR | 1288600 |  | 46046 |
|  Turkiye Garanti Bankasi A/S | 13849 |  | 17495 |
|  Turkiye Halk Bankasi A/S\* | 237748 |  | 105308 |
|  Turkiye Is Bankasi A/S, Class C | 117781 |  | 59008 |
|  Turkiye Vakiflar Bankasi TAO, Class D\* | 19050 |  | 8776 |
|  Union Bank of India Ltd. | 27150 |  | 17679 |
|  Union Bank of Taiwan | 50000 |  | 23508 |
|  Union Bank of the Philippines | 7980 |  | 10603 |
|  United Bank Ltd. | 193914 |  | 94284 |
|  VTB Bank PJSC\* ‡ | 136511531 |  |  |
|  Warba Bank KSCP\* | 13340 |  | 10379 |
|  Woori Financial Group, Inc. | 17885 |  | 147530 |
|  Yapi ve Kredi Bankasi A/S | 76200 |  | 37725 |
|  Yes Bank Ltd.\* | 38361 |  | 7206 |
|  |  |  | **28772869** |
| **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** |
|  Ambev SA | 77700 |  | 236924 |
|  Anadolu Efes Biracilik ve Malt Sanayii A/S | 5350 |  | 13793 |
|  Anhui Gujing Distillery Co. Ltd., Class A | 700 |  | 18900 |
|  Anhui Gujing Distillery Co. Ltd., Class B | 2200 |  | 25932 |
|  Arca Continental SAB de CV | 14700 |  | 120191 |
|  Becle SAB de CV(a) | 10700 |  | 22592 |
|  Carabao Group PCL, NVDR | 11600 |  | 27507 |
|  China Foods Ltd. | 294000 |  | 74906 |
|  China Resources Beer Holdings Co. Ltd. | 27107 |  | 127768 |
|  Chongqing Brewery Co. Ltd., Class A | 600 |  | 7187 |
|  Coca-Cola Femsa SAB de CV | 9800 |  | 61622 |
|  Coca-Cola Icecek A/S | 2875 |  | 26582 |
|  Distell Group Holdings Ltd.\* | 2280 |  | 21541 |
|  Embotelladora Andina SA (Preference), Class B | 153688 |  | 268681 |
|  Emperador, Inc.\* | 55200 |  | 18651 |

---

*See Accompanying Notes to the Financial Statements.* 

238 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** |
|  Fomento Economico Mexicano SAB de CV | 29914 | $| 214352 |
|  Fraser & Neave Holdings Bhd. | 3700 |  | 16074 |
|  Hebei Hengshui Laobaigan Liquor Co. Ltd., Class A | 2300 |  | 6690 |
|  Heineken Malaysia Bhd. | 3800 |  | 18566 |
|  Hite Jinro Co. Ltd. | 348 |  | 6266 |
|  Jiangsu Yanghe Brewery Joint-Stock Co. Ltd., Class A | 2100 |  | 37591 |
|  JiuGui Liquor Co. Ltd., Class A | 500 |  | 6991 |
|  Kweichow Moutai Co. Ltd., Class A | 1800 |  | 332941 |
|  Lotte Chilsung Beverage Co. Ltd. | 150 |  | 14795 |
|  Luzhou Laojiao Co. Ltd., Class A | 2400 |  | 51413 |
|  Nongfu Spring Co. Ltd., Class H(b) | 32600 |  | 163834 |
|  Osotspa PCL, NVDR | 31700 |  | 22072 |
|  Radico Khaitan Ltd. | 3528 |  | 44404 |
|  Shanxi Xinghuacun Fen Wine Factory Co. Ltd., Class A | 1960 |  | 62404 |
|  Tsingtao Brewery Co. Ltd., Class A | 1100 |  | 12328 |
|  Tsingtao Brewery Co. Ltd., Class H | 10000 |  | 70065 |
|  United Breweries Ltd. | 1379 |  | 27535 |
|  United Spirits Ltd.\* | 5584 |  | 60466 |
|  Varun Beverages Ltd. | 5047 |  | 63961 |
|  Vina Concha y Toro SA | 179427 |  | 202655 |
|  Wuliangye Yibin Co. Ltd., Class A | 4900 |  | 89627 |
|  |  |  | **2597807** |
| **Biotechnology – 0.8%** | **Biotechnology – 0.8%** | **Biotechnology – 0.8%** | **Biotechnology – 0.8%** |
|  3SBio, Inc.(b) | 294000 |  | 207489 |
|  ABLBio, Inc.\* | 1585 |  | 22310 |
|  Adimmune Corp.\* | 19000 |  | 19370 |
|  Akeso, Inc., Class B\* (a) (b) | 17000 |  | 68218 |
|  Alphamab Oncology\* (a) (b) | 24000 |  | 16846 |
|  Alteogen, Inc.\* | 936 |  | 24115 |
|  Amicogen, Inc.\* | 514 |  | 6856 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  BeiGene Ltd.\* | 14700 | $185392 |
|  Beijing Tiantan Biological Products Corp. Ltd., Class A | 6360 | 18012 |
|  Beijing Wantai Biological Pharmacy Enterprise Co. Ltd., Class A | 1015 | 17456 |
|  Biocon Ltd. | 6644 | 21659 |
|  Bioneer Corp.\* | 1265 | 23667 |
|  BNC Korea Co. Ltd.\* | 2035 | 7586 |
|  Celltrion, Inc. | 1703 | 229545 |
|  Daan Gene Co. Ltd., Class A | 8000 | 19598 |
|  Eubiologics Co. Ltd.\* | 935 | 6827 |
|  GC Cell Corp.\* | 3365 | 106777 |
|  GeneOne Life Science, Inc.\* | 3823 | 19834 |
|  Genexine, Inc.\* | 1440 | 22645 |
|  Green Cross Corp. | 163 | 14590 |
|  Green Cross Holdings Corp. | 15092 | 183823 |
|  Helixmith Co. Ltd.\* | 1890 | 16585 |
|  Hualan Biological Engineering, Inc., Class A | 5300 | 12875 |
|  Hugel, Inc.\* | 126 | 9889 |
|  I-Mab, ADR\* | 742 | 2753 |
|  InnoCare Pharma Ltd.\* (a) (b) | 31000 | 36213 |
|  Innovent Biologics, Inc.\* (a) (b) | 19000 | 67288 |
|  iNtRON Biotechnology, Inc.\* | 1643 | 10208 |
|  Kintor Pharmaceutical Ltd.\* (b) | 7000 | 11093 |
|  L&C Bio Co. Ltd. | 899 | 14169 |
|  Medigen Vaccine Biologics Corp.\* | 4564 | 9122 |
|  MedPacto, Inc.\* | 235 | 3811 |
|  Medytox, Inc. | 120 | 8862 |
|  Naturecell Co. Ltd.\* | 2743 | 33314 |
|  NKMax Co. Ltd.\* | 1797 | 16905 |
|  OBI Pharma, Inc.\* | 10354 | 20983 |
|  PharmaResearch Co. Ltd. | 349 | 15068 |
|  Pharmicell Co. Ltd.\* | 2919 | 20902 |
|  Prestige Biopharm Ltd., KDR\* | 8772 | 46740 |
|  Seegene, Inc. | 1378 | 27764 |
|  Shanghai Junshi Biosciences Co. Ltd., Class A\* | 1113 | 10836 |
|  Shanghai Junshi Biosciences Co. Ltd., Class H\* (a) (b) | 2200 | 7693 |
|  Shanghai RAAS Blood Products Co. Ltd., Class A | 9400 | 7006 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 239

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  SK Bioscience Co. Ltd.\* | 468 | $| 24838 |
|  Tanvex BioPharma, Inc.\* | 6000 |  | 5484 |
|  Vaxcell-Bio Therapeutics Co. Ltd.\* | 371 |  | 9441 |
|  Zai Lab Ltd.\* | 13300 |  | 30633 |
|  Zhejiang Orient Gene Biotech Co. Ltd., Class A | 770 |  | 8714 |
|  |  |  | **1731804** |
| **Building Products – 0.3%** | **Building Products – 0.3%** | **Building Products – 0.3%** | **Building Products – 0.3%** |
|  Astral Ltd. | 1731 |  | 42474 |
|  Beijing New Building Materials plc, Class A | 5300 |  | 14400 |
|  Blue Star Ltd. | 2703 |  | 40365 |
|  China Lesso Group Holdings Ltd. | 33000 |  | 26779 |
|  Kajaria Ceramics Ltd. | 1150 |  | 15021 |
|  KCC Glass Corp. | 4410 |  | 119813 |
|  Kyung Dong Navien Co. Ltd. | 2850 |  | 68927 |
|  Luoyang Glass Co. Ltd., Class H\* (a) | 18000 |  | 16258 |
|  LX Hausys Ltd. | 88 |  | 1989 |
|  Saudi Ceramic Co. | 935 |  | 10302 |
|  Taiwan Glass Industry Corp. | 48000 |  | 30389 |
|  Xinyi Glass Holdings Ltd. | 80000 |  | 102932 |
|  Zhejiang Weixing New Building Materials Co. Ltd., Class A | 5300 |  | 12635 |
|  Zhuzhou Kibing Group Co. Ltd., Class A | 5300 |  | 5700 |
|  |  |  | **507984** |
| **Capital Markets – 1.8%** | **Capital Markets – 1.8%** | **Capital Markets – 1.8%** | **Capital Markets – 1.8%** |
|  Aju IB Investment Co. Ltd. | 828 |  | 1462 |
|  Angel One Ltd. | 1600 |  | 30978 |
|  B3 SA – Brasil Bolsa Balcao | 107800 |  | 308983 |
|  Banco BTG Pactual SA\* | 19600 |  | 108099 |
|  Bangkok Commercial Asset Management PCL, NVDR | 26500 |  | 10653 |
|  Bolsa Mexicana de Valores SAB de CV | 10400 |  | 18904 |
|  Boursa Kuwait Securities Co. KPSC | 2016 |  | 14787 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Bursa Malaysia Bhd. | 8000 | $10914 |
|  Caitong Securities Co. Ltd., Class A | 12220 | 11971 |
|  Capital Securities Corp. | 79000 | 24517 |
|  Changjiang Securities Co. Ltd., Class A | 14100 | 10065 |
|  China Bills Finance Corp. | 53000 | 23356 |
|  China Cinda Asset Management Co. Ltd., Class H | 3465000 | 322229 |
|  China Everbright Ltd.(a) | 350000 | 184590 |
|  China Galaxy Securities Co. Ltd., Class A | 5200 | 6419 |
|  China Galaxy Securities Co. Ltd., Class H | 128500 | 48127 |
|  China International Capital Corp. Ltd., Class A | 1600 | 7594 |
|  China International Capital Corp. Ltd., Class H(b) | 19600 | 27266 |
|  China Merchants Securities Co. Ltd., Class A | 21220 | 36343 |
|  China Merchants Securities Co. Ltd., Class H(a) (b) | 16600 | 15395 |
|  CITIC Securities Co. Ltd., Class A | 17175 | 40498 |
|  CITIC Securities Co. Ltd., Class H | 29073 | 43481 |
|  Coronation Fund Managers Ltd. | 7009 | 12517 |
|  CRISIL Ltd. | 342 | 12386 |
|  CSC Financial Co. Ltd., Class A | 7500 | 24261 |
|  CSC Financial Co. Ltd., Class H(a) (b) | 351000 | 254424 |
|  Daishin Securities Co. Ltd. | 212 | 2076 |
|  Daishin Securities Co. Ltd. (Preference) | 530 | 4911 |
|  Daou Data Corp. | 6370 | 69538 |
|  Daou Technology, Inc. | 9485 | 120523 |
|  Dubai Financial Market PJSC | 33628 | 12909 |
|  Egyptian Financial Group-Hermes Holding Co.\* | 359104 | 199254 |
|  Everbright Securities Co. Ltd., Class A | 9400 | 18057 |

---

*See Accompanying Notes to the Financial Statements.* 

240 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Founder Securities Co. Ltd., Class A | 14100 | $12229 |
|  GF Securities Co. Ltd., Class A | 14100 | 26331 |
|  GF Securities Co. Ltd., Class H | 29400 | 29925 |
|  Guangzhou Yuexiu Financial Holdings Group Co. Ltd., Class A | 11664 | 8901 |
|  Guosen Securities Co. Ltd., Class A | 14100 | 16653 |
|  Guotai Junan International Holdings Ltd.(a) | 1108000 | 79044 |
|  Guotai Junan Securities Co. Ltd., Class A | 19600 | 35502 |
|  Guotai Junan Securities Co. Ltd., Class H(a) (b) | 21200 | 21416 |
|  Haitong Securities Co. Ltd., Class A | 18800 | 21740 |
|  Haitong Securities Co. Ltd., Class H | 98000 | 47940 |
|  Hanwha Investment & Securities Co. Ltd. | 5088 | 8787 |
|  HDFC Asset Management Co. Ltd.(b) | 1150 | 28822 |
|  Huatai Securities Co. Ltd., Class A | 24100 | 39525 |
|  Huatai Securities Co. Ltd., Class H(b) | 46200 | 45259 |
|  IBF Financial Holdings Co. Ltd. | 52387 | 18046 |
|  ICICI Securities Ltd.(b) | 1880 | 11727 |
|  IDFC Ltd. | 53949 | 50477 |
|  IIFL Wealth Management Ltd. | 2010 | 43013 |
|  Indian Energy Exchange Ltd.(b) | 7100 | 12000 |
|  Industrial Securities Co. Ltd., Class A\* | 34450 | 25724 |
|  Investec Ltd. | 8207 | 40348 |
|  Is Yatirim Menkul Degerler A/S | 47824 | 92805 |
|  JM Financial Ltd. | 150439 | 124400 |
|  JSE Ltd. | 1224 | 6770 |
|  KIWOOM Securities Co. Ltd. | 640 | 36303 |
|  Korea Investment Holdings Co. Ltd. | 1225 | 42612 |
|  Meritz Securities Co. Ltd. | 6708 | 17424 |
|  Mirae Asset Securities Co. Ltd. | 7325 | 32654 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Moscow Exchange MICEX-RTS PJSC\* ‡ | 29911 | $— |
|  Multi Commodity Exchange of India Ltd. | 583 | 10820 |
|  Nanjing Securities Co. Ltd., Class A | 9400 | 10200 |
|  NH Investment & Securities Co. Ltd. | 5356 | 33728 |
|  Ninety One Ltd. | 6828 | 16051 |
|  Nippon Life India Asset Management Ltd.(b) | 5244 | 17136 |
|  Orient Securities Co. Ltd., Class A | 12032 | 12793 |
|  Orient Securities Co. Ltd., Class H(b) | 20400 | 7614 |
|  Pacific Strategic Financial Tbk. PT\* | 448500 | 32924 |
|  Pihsiang Machinery Manufacturing Co. Ltd.\* ‡ | 5000 |  |
|  President Securities Corp. | 53000 | 24097 |
|  PSG Konsult Ltd. | 24750 | 14774 |
|  Reinet Investments SCA | 2450 | 39347 |
|  Samsung Securities Co. Ltd. | 2009 | 44779 |
|  Saratoga Investama Sedaya Tbk. PT | 27500 | 4337 |
|  Saudi Tadawul Group Holding Co. | 811 | 46879 |
|  Shenwan Hongyuan Group Co. Ltd., Class A | 47900 | 25530 |
|  Shinyoung Securities Co. Ltd. | 1617 | 62775 |
|  Sinolink Securities Co. Ltd., Class A | 9400 | 10162 |
|  Sociedad de Inversiones Oro Blanco SA | 19516629 | 164973 |
|  SPIC Industry-Finance Holdings Co. Ltd., Class A | 10000 | 5631 |
|  UTI Asset Management Co. Ltd. | 3250 | 27548 |
|  Western Securities Co. Ltd., Class A | 10000 | 8180 |
|  Woori Investment Bank Co. Ltd. | 6985 | 3712 |
|  Woori Technology Investment Co. Ltd.\* | 22483 | 70237 |
|  Yuanta Securities Korea Co. Ltd. | 39528 | 66738 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 241

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Zheshang Securities Co. Ltd., Class A | 4700 | $| 6549 |
|  Zhongtai Securities Co. Ltd., Class A | 15900 |  | 13855 |
|  |  |  | **3795233** |
| **Chemicals – 4.6%** | **Chemicals – 4.6%** | **Chemicals – 4.6%** | **Chemicals – 4.6%** |
|  Aarti Industries Ltd. | 4383 |  | 37017 |
|  Advanced Nano Products Co. Ltd. | 355 |  | 23177 |
|  Advanced Petrochemical Co. | 2025 |  | 23874 |
|  AECI Ltd. | 40122 |  | 201511 |
|  Aekyung Chemical Co. Ltd. | 6076 |  | 39627 |
|  Alkyl Amines Chemicals | 220 |  | 7849 |
|  Alpek SAB de CV(a) | 19636 |  | 27472 |
|  Alujain Corp. | 13909 |  | 174346 |
|  Asia Polymer Corp. | 147000 |  | 113366 |
|  Asian Paints Ltd. | 7423 |  | 278680 |
|  Atul Ltd. | 259 |  | 26199 |
|  Avia Avian Tbk. PT | 561700 |  | 28270 |
|  Balaji Amines Ltd. | 350 |  | 12790 |
|  Barito Pacific Tbk. PT | 474700 |  | 25108 |
|  BASF India Ltd. | 400 |  | 13863 |
|  Batu Kawan Bhd. | 6300 |  | 28009 |
|  Bayer CropScience Ltd. | 141 |  | 7969 |
|  Berger Paints India Ltd. | 5344 |  | 37818 |
|  Boubyan Petrochemicals Co. KSCP | 7344 |  | 18896 |
|  Braskem SA (Preference), Class A | 5500 |  | 35334 |
|  Carborundum Universal Ltd. | 5096 |  | 52073 |
|  Castrol India Ltd. | 18650 |  | 28005 |
|  Chambal Fertilisers and Chemicals Ltd. | 4398 |  | 17342 |
|  Chandra Asri Petrochemical Tbk. PT | 392000 |  | 61323 |
|  Chemplast Sanmar Ltd.\* | 27538 |  | 124820 |
|  China General Plastics Corp. | 21000 |  | 12871 |
|  China Lumena New Materials Corp.\* ‡ | 22200 |  |  |
|  China Man-Made Fiber Corp.\* | 50000 |  | 11995 |
|  China Petrochemical Development Corp. | 85254 |  | 24844 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  China Risun Group Ltd.(a) (b) | 490000 | $172908 |
|  China Steel Chemical Corp. | 9000 | 28769 |
|  China XLX Fertiliser Ltd. | 196000 | 74906 |
|  Chunbo Co. Ltd. | 141 | 21638 |
|  CNNC Hua Yuan Titanium Dioxide Co. Ltd., Class A | 7975 | 7299 |
|  Coromandel International Ltd. | 1898 | 22066 |
|  D&L Industries, Inc. | 110800 | 15028 |
|  DCM Shriram Ltd. | 1375 | 17368 |
|  Deepak Fertilisers & Petrochemicals Corp. Ltd. | 2538 | 29616 |
|  Deepak Nitrite Ltd. | 1105 | 30889 |
|  Dongjin Semichem Co. Ltd. | 725 | 15320 |
|  Dongyue Group Ltd. | 42000 | 36490 |
|  Ecopro Co. Ltd. | 619 | 61707 |
|  Egypt Kuwait Holding Co. SAE | 10969 | 12680 |
|  EID Parry India Ltd. | 40072 | 299847 |
|  Engro Corp. Ltd. | 132285 | 141184 |
|  Engro Fertilizers Ltd. | 239264 | 87650 |
|  Engro Polymer & Chemicals Ltd. | 112242 | 26745 |
|  Eternal Materials Co. Ltd. | 27550 | 25564 |
|  Fauji Fertilizer Co. Ltd. | 280616 | 131347 |
|  Fertiglobe plc | 35182 | 48754 |
|  Fine Organic Industries Ltd. | 350 | 24275 |
|  Finolex Industries Ltd. | 9600 | 15535 |
|  Foosung Co. Ltd. | 1768 | 15391 |
|  Formosa Chemicals & Fibre Corp. | 68000 | 146668 |
|  Formosa Plastics Corp. | 76000 | 196000 |
|  Formosan Union Chemical | 143000 | 90311 |
|  Fufeng Group Ltd. | 453000 | 234872 |
|  Galaxy Surfactants Ltd.(b) | 250 | 8785 |
|  Grand Pacific Petrochemical | 343000 | 185218 |
|  Guangzhou Tinci Materials Technology Co. Ltd., Class A | 5000 | 29115 |
|  Gujarat Fluorochemicals Ltd. | 715 | 32745 |
|  Gujarat Narmada Valley Fertilizers & Chemicals Ltd. | 3600 | 30841 |
|  Hangzhou Oxygen Plant Group Co. Ltd. | 2400 | 13840 |
|  Hansol Chemical Co. Ltd. | 232 | 30212 |
|  Hanwha Solutions Corp.\* | 3591 | 118990 |

---

*See Accompanying Notes to the Financial Statements.* 

242 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Hektas Ticaret TAS\* | 25017 | $38515 |
|  Hengli Petrochemical Co. Ltd., Class A | 14700 | 30896 |
|  Hengyi Petrochemical Co. Ltd., Class A | 14100 | 12944 |
|  Hoshine Silicon Industry Co. Ltd., Class A | 1900 | 24913 |
|  Huabao International Holdings Ltd.(a) | 17000 | 7840 |
|  Huafon Chemical Co. Ltd., Class A | 5300 | 4836 |
|  Hubei Xingfa Chemicals Group Co. Ltd., Class A | 5000 | 19367 |
|  Hyosung Advanced Materials Corp. | 55 | 12317 |
|  Hyosung Chemical Corp.\* | 441 | 31424 |
|  Hyosung TNC Corp. | 110 | 20194 |
|  Indorama Ventures PCL, NVDR | 66700 | 73605 |
|  Inner Mongolia Junzheng Energy & Chemical Industry Group Co. Ltd., Class A | 23500 | 12493 |
|  International CSRC Investment Holdings Co. | 50000 | 29327 |
|  Jiangsu Eastern Shenghong Co. Ltd., Class A | 11000 | 18447 |
|  Jubilant Ingrevia Ltd. | 2701 | 16794 |
|  Kansai Nerolac Paints Ltd. | 2196 | 12893 |
|  KCC Corp. | 106 | 18157 |
|  KG Chemical Corp. | 3609 | 58273 |
|  Kolon Industries, Inc. | 674 | 20583 |
|  Korea Petrochemical Ind Co. Ltd. | 1688 | 140425 |
|  KuibyshevAzot PJSC‡ | 9900 |  |
|  Kukdo Chemical Co. Ltd. | 2061 | 62650 |
|  Kumho Petrochemical Co. Ltd. | 441 | 40557 |
|  LB Group Co. Ltd., Class A | 4700 | 9898 |
|  LG Chem Ltd. | 833 | 366077 |
|  LG Chem Ltd. (Preference) | 170 | 34490 |
|  Linde India Ltd. | 624 | 23155 |
|  Lotte Chemical Corp. | 490 | 50911 |
|  LOTTE Fine Chemical Co. Ltd. | 397 | 15635 |
|  Luxi Chemical Group Co. Ltd., Class A | 6500 | 10117 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Mesaieed Petrochemical Holding Co. | 68381 | $42624 |
|  Miwon Commercial Co. Ltd. | 125 | 14874 |
|  Miwon Specialty Chemical Co. Ltd. | 120 | 14111 |
|  Nan Ya Plastics Corp. | 173000 | 366697 |
|  Nantex Industry Co. Ltd. | 109000 | 114674 |
|  National Industrialization Co.\* | 5584 | 19884 |
|  Navin Fluorine International Ltd. | 645 | 35467 |
|  Ningxia Baofeng Energy Group Co. Ltd., Class A | 10600 | 16658 |
|  Nizhnekamskneftekhim PJSC‡ | 28600 |  |
|  Nizhnekamskneftekhim PJSC (Preference)‡ | 26400 |  |
|  OCI Co. Ltd. | 602 | 43107 |
|  Omnia Holdings Ltd. | 8788 | 34435 |
|  Orbia Advance Corp. SAB de CV | 29933 | 50444 |
|  Organichesky Sintez PJSC‡ | 11550 |  |
|  Oriental Union Chemical Corp. | 38000 | 19930 |
|  Petkim Petrokimya Holding A/S\* | 38400 | 27743 |
|  Petronas Chemicals Group Bhd. | 43900 | 80966 |
|  PhosAgro PJSC‡ | 1540 |  |
|  PI Advanced Materials Co. Ltd. | 520 | 10824 |
|  PI Industries Ltd. | 1239 | 48525 |
|  Pidilite Industries Ltd. | 2401 | 74962 |
|  Polyplex Corp. Ltd. | 740 | 14999 |
|  PTT Global Chemical PCL, NVDR | 63300 | 72348 |
|  Qinghai Salt Lake Industry Co. Ltd., Class A\* | 10937 | 32233 |
|  Rongsheng Petrochemical Co. Ltd., Class A | 24500 | 35918 |
|  SABIC Agri-Nutrients Co. | 3907 | 165324 |
|  Sahara International Petrochemical Co. | 5287 | 57055 |
|  Sasa Polyester Sanayi A/S\* | 8102 | 52350 |
|  Sasol Ltd. | 17437 | 293224 |
|  Satellite Chemical Co. Ltd., Class A | 4662 | 7921 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 243

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Saudi Basic Industries Corp. | 15631 | $367734 |
|  Saudi Industrial Investment Group | 6752 | 40395 |
|  Saudi Kayan Petrochemical Co.\* | 15974 | 55945 |
|  Scientex Bhd. | 26100 | 17996 |
|  Shandong Hualu Hengsheng Chemical Co. Ltd., Class A | 6110 | 21916 |
|  Shanghai Putailai New Energy Technology Co. Ltd., Class A | 2800 | 19147 |
|  Shin Foong Specialty & Applied Materials Co. Ltd. | 17000 | 27118 |
|  Shinkong Synthetic Fibers Corp. | 53000 | 26564 |
|  Shiny Chemical Industrial Co. Ltd. | 3750 | 11696 |
|  Sichuan Yahua Industrial Group Co. Ltd., Class A | 3600 | 13194 |
|  Sinofert Holdings Ltd.\* (a) | 700000 | 69555 |
|  Sinon Corp. | 21000 | 23136 |
|  SK Chemicals Co. Ltd. | 412 | 25568 |
|  SK IE Technology Co. Ltd.\* (b) | 349 | 12740 |
|  SKC Co. Ltd. | 424 | 30808 |
|  Sociedad Quimica y Minera de Chile SA (Preference), Class B | 2463 | 234344 |
|  Solar Applied Materials Technology Corp. | 26000 | 22351 |
|  Solar Industries India Ltd. | 699 | 32948 |
|  Soulbrain Co. Ltd. | 141 | 20262 |
|  Soulbrain Holdings Co. Ltd. | 1782 | 28961 |
|  SRF Ltd. | 2588 | 79995 |
|  Sumitomo Chemical India Ltd. | 2585 | 15383 |
|  Supreme Industries Ltd. | 1204 | 31567 |
|  Supreme Petrochem Ltd. | 1728 | 15741 |
|  Surya Esa Perkasa Tbk. PT | 280400 | 19146 |
|  Taekwang Industrial Co. Ltd. | 98 | 48365 |
|  Taiwan Fertilizer Co. Ltd. | 13000 | 21100 |
|  Tata Chemicals Ltd. | 2793 | 38222 |
|  TKG Huchems Co. Ltd. | 1338 | 19585 |
|  Tongkun Group Co. Ltd., Class A | 9400 | 15584 |
|  TSRC Corp. | 264000 | 216706 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Unid Co. Ltd. | 2475 | $| 133788 |
|  Unipar Carbocloro SA | 3335 |  | 58911 |
|  Unipar Carbocloro SA (Preference), Class B | 20049 |  | 408029 |
|  UPC Technology Corp. | 349000 |  | 132137 |
|  UPL Ltd. | 9408 |  | 82990 |
|  USI Corp. | 28000 |  | 17596 |
|  Wanhua Chemical Group Co. Ltd., Class A | 4900 |  | 53951 |
|  Xinjiang Zhongtai Chemical Co. Ltd., Class A | 10600 |  | 8540 |
|  Yanbu National Petrochemical Co. | 5439 |  | 64703 |
|  Yunnan Energy New Material Co. Ltd. | 1200 |  | 24340 |
|  Zhejiang Yongtai Technology Co. Ltd., Class A | 2800 |  | 8371 |
|  |  |  | **9557179** |
| **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** |
|  China Conch Environment Protection Holdings Ltd.\* | 73500 |  | 21629 |
|  China Everbright Environment Group Ltd. | 98000 |  | 32584 |
|  Cleanaway Co. Ltd. | 5000 |  | 25914 |
|  Dynagreen Environmental Protection Group Co. Ltd., Class H(a) (b) | 165000 |  | 45192 |
|  Ecopro HN Co. Ltd. | 687 |  | 24934 |
|  Frontken Corp. Bhd. | 21800 |  | 11297 |
|  GPS Participacoes e Empreendimentos SA(c) | 14100 |  | 37136 |
|  Indian Railway Catering & Tourism Corp. Ltd. | 5390 |  | 48263 |
|  KEPCO Plant Service & Engineering Co. Ltd. | 100 |  | 2239 |
|  PNB Holdings Corp.\* | 46815 |  | 33725 |
|  S-1 Corp. | 347 |  | 15201 |
|  Saudi Airlines Catering Co.\* | 1848 |  | 38115 |
|  Sunny Friend Environmental Technology Co. Ltd. | 5000 |  | 20870 |
|  Taiwan Secom Co. Ltd. | 3165 |  | 9076 |
|  |  |  | **366175** |

---

*See Accompanying Notes to the Financial Statements.* 

244 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** |
|  Accton Technology Corp. | 9000 | $67872 |
|  Advanced Ceramic X Corp. | 2000 | 9527 |
|  Arcadyan Technology Corp. | 69000 | 193151 |
|  BYD Electronic International Co. Ltd.(a) | 24500 | 71161 |
|  Hengtong Optic-electric Co. Ltd., Class A | 10000 | 26649 |
|  Intelbras SA Industria de Telecomunicacao Eletronica Brasileira | 5713 | 39762 |
|  Intellian Technologies, Inc. | 218 | 9550 |
|  KMW Co. Ltd.\* | 563 | 9347 |
|  Seojin System Co. Ltd. | 11117 | 114725 |
|  Sercomm Corp. | 10000 | 23462 |
|  Sterlite Technologies Ltd. | 11660 | 23185 |
|  Tejas Networks Ltd.\* (b) | 2300 | 19066 |
|  Tianjin 712 Communication & Broadcasting Co. Ltd., Class A | 900 | 4857 |
|  Wistron NeWeb Corp. | 13000 | 33768 |
|  ZTE Corp., Class A | 4700 | 14277 |
|  ZTE Corp., Class H | 10600 | 18905 |
|  |  | **679264** |
| **Construction & Engineering – 1.3%** | **Construction & Engineering – 1.3%** | **Construction & Engineering – 1.3%** |
|  BES Engineering Corp. | 530000 | 131421 |
|  CH Karnchang PCL, NVDR | 44000 | 26821 |
|  China Communications Services Corp. Ltd., Class H | 934000 | 260573 |
|  China Conch Venture Holdings Ltd.(a) | 49000 | 72284 |
|  China Energy Engineering Corp. Ltd. | 80000 | 25101 |
|  China Energy Engineering Corp. Ltd., Class H(a) | 100000 | 10064 |
|  China Railway Group Ltd., Class A | 45200 | 30903 |
|  China Railway Group Ltd., Class H | 119000 | 51694 |
|  Continental Holdings Corp. | 196000 | 169708 |
|  Daewoo Engineering & Construction Co. Ltd.\* | 3901 | 11516 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  Dayamitra Telekomunikasi Tbk. PT\* | 565500 | $25923 |
|  DL Construction Co. Ltd. | 3822 | 35283 |
|  DL E&C Co. Ltd. | 1300 | 31440 |
|  DL Holdings Co. Ltd. | 397 | 17140 |
|  Gamuda Bhd. | 49119 | 39997 |
|  Greentown Management Holdings Co. Ltd.(b) | 35000 | 20064 |
|  GS Engineering & Construction Corp. | 2450 | 37323 |
|  HDC Hyundai Development Co-Engineering & Construction, Class E | 16010 | 112394 |
|  Hyundai Engineering & Construction Co. Ltd. | 2280 | 55862 |
|  IJM Corp. Bhd. | 78400 | 27029 |
|  IRB Infrastructure Developers Ltd. | 4804 | 13566 |
|  IS Dongseo Co. Ltd. | 808 | 17896 |
|  KEC International Ltd. | 6678 | 35497 |
|  KEPCO Engineering & Construction Co., Inc. | 382 | 13315 |
|  KNR Constructions Ltd. | 6325 | 17009 |
|  Larsen & Toubro Ltd. | 12049 | 294480 |
|  Larsen & Toubro Ltd., GDR(b) | 296 | 7134 |
|  Metallurgical Corp. of China Ltd., Class A | 65800 | 25964 |
|  Metallurgical Corp. of China Ltd., Class H | 106000 | 16879 |
|  NBCC India Ltd. | 41870 | 16414 |
|  PNC Infratech Ltd.(b) | 2700 | 8415 |
|  Power Construction Corp. of China Ltd., Class A | 35500 | 34242 |
|  Praj Industries Ltd. | 6061 | 30255 |
|  Rail Vikas Nigam Ltd.(b) | 192325 | 92936 |
|  Ruentex Engineering & Construction Co. | 26000 | 72297 |
|  Run Long Construction Co. Ltd. | 87400 | 171694 |
|  Samsung Engineering Co. Ltd.\* | 2842 | 47584 |
|  Shanghai Construction Group Co. Ltd., Class A | 23500 | 8275 |
|  Shanghai Tunnel Engineering Co. Ltd., Class A | 14100 | 10046 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 245

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  Sichuan Road and Bridge Group Co. Ltd., Class A | 14600 | $| 22504 |
|  Tekfen Holding A/S | 63210 |  | 111993 |
|  TY Holdings Co. Ltd.\* | 8750 |  | 64806 |
|  United Integrated Services Co. Ltd. | 3000 |  | 13500 |
|  Voltas Ltd. | 3969 |  | 42012 |
|  Waskita Karya Persero Tbk. PT\* | 603196 |  | 18563 |
|  Xinte Energy Co. Ltd., Class H(a) | 148000 |  | 288841 |
|  Yankey Engineering Co. Ltd. | 15000 |  | 73318 |
|  |  |  | **2761975** |
| **Construction Materials – 1.5%** | **Construction Materials – 1.5%** | **Construction Materials – 1.5%** | **Construction Materials – 1.5%** |
|  ACC Ltd. | 1376 |  | 39734 |
|  Afrimat Ltd. | 3450 |  | 9011 |
|  Ambuja Cements Ltd. | 11366 |  | 73178 |
|  Anhui Conch Cement Co. Ltd., Class A | 9800 |  | 32601 |
|  Anhui Conch Cement Co. Ltd., Class H | 35000 |  | 90065 |
|  Arabian Cement Co. | 2310 |  | 23115 |
|  Asia Cement China Holdings Corp.(a) | 179000 |  | 62480 |
|  Asia Cement Co. Ltd. | 7644 |  | 49745 |
|  Asia Cement Corp. | 79000 |  | 91448 |
|  BBMG Corp., Class A | 42300 |  | 13504 |
|  Beijing Oriental Yuhong Waterproof Technology Co. Ltd., Class A | 6000 |  | 20141 |
|  Berkah Beton Sadaya Tbk. PT | 85000 |  | 22071 |
|  Birla Corp. Ltd. | 750 |  | 8363 |
|  Cementos Argos SA | 22735 |  | 15504 |
|  Cemex SAB de CV\* | 428000 |  | 166034 |
|  Chia Hsin Cement Corp. | 50000 |  | 24595 |
|  China Jushi Co. Ltd., Class A | 5143 |  | 8244 |
|  China National Building Material Co. Ltd., Class H | 134050 |  | 77870 |
|  China Resources Cement Holdings Ltd.(a) | 68000 |  | 24602 |
|  China Tianrui Group Cement Co. Ltd.\* | 36000 |  | 27058 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** |
|  City Cement Co. | 4208 | $22778 |
|  CSG Holding Co. Ltd., Class B | 452100 | 173356 |
|  Dalmia Bharat Ltd. | 1710 | 33072 |
|  Eastern Province Cement Co. | 1199 | 14136 |
|  GCC SAB de CV(a) | 7800 | 48343 |
|  Goldsun Building Materials Co. Ltd. | 38000 | 26711 |
|  Grasim Industries Ltd. | 5978 | 124337 |
|  Grupo Argos SA | 142475 | 299060 |
|  Hanil Cement Co. Ltd. | 1031 | 8179 |
|  Huaxin Cement Co. Ltd., Class A | 3700 | 6803 |
|  Huaxin Cement Co. Ltd., Class H | 10400 | 8983 |
|  India Cements Ltd. (The) | 5000 | 14563 |
|  Indocement Tunggal Prakarsa Tbk. PT | 32900 | 19564 |
|  JK Cement Ltd. | 530 | 17368 |
|  Lucky Cement Ltd.\* | 45227 | 99593 |
|  Nuh Cimento Sanayi A/S | 23128 | 108846 |
|  Nuvoco Vistas Corp. Ltd.\* | 3650 | 17483 |
|  Oyak Cimento Fabrikalari A/S\* | 21550 | 19461 |
|  POSCO Chemical Co. Ltd. | 499 | 69887 |
|  Qassim Cement Co. (The) | 1998 | 40092 |
|  Qatar National Cement Co. QSC | 11041 | 13810 |
|  Ramco Cements Ltd. (The) | 2289 | 19960 |
|  Rhi Magnesita India Ltd. | 1850 | 14481 |
|  Riyadh Cement Co. | 1967 | 16804 |
|  Saudi Cement Co. | 2022 | 28682 |
|  Semen Indonesia Persero Tbk. PT | 57600 | 29359 |
|  Shree Cement Ltd. | 196 | 53845 |
|  Siam Cement PCL (The), NVDR | 8500 | 72359 |
|  Southern Province Cement Co. | 1634 | 23830 |
|  SSANGYONG C&E Co. Ltd. | 290 | 1156 |
|  Taiwan Cement Corp. | 180684 | 169623 |
|  Tangshan Jidong Cement Co. Ltd., Class A | 4700 | 4888 |
|  Tipco Asphalt PCL, NVDR | 59300 | 26643 |
|  TPI Polene PCL, NVDR | 1950300 | 90700 |
|  UltraTech Cement Ltd. | 2109 | 171083 |

---

*See Accompanying Notes to the Financial Statements.* 

246 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** |
|  Unacem Corp. SAA | 371616 | $| 158484 |
|  Universal Cement Corp. | 146000 |  | 90620 |
|  Yamama Cement Co.\* | 3763 |  | 29443 |
|  Yanbu Cement Co. | 2888 |  | 32050 |
|  |  |  | **3099798** |
| **Consumer Finance – 0.9%** | **Consumer Finance – 0.9%** | **Consumer Finance – 0.9%** | **Consumer Finance – 0.9%** |
|  360 DigiTech, Inc., ADR | 48020 |  | 487883 |
|  AEON Credit Service M Bhd. | 5600 |  | 15398 |
|  Bajaj Finance Ltd. | 4655 |  | 401749 |
|  BFI Finance Indonesia Tbk. PT | 150000 |  | 10627 |
|  Capri Global Capital Ltd. | 1948 |  | 17641 |
|  Cholamandalam Investment and Finance Co. Ltd. | 7595 |  | 65084 |
|  CreditAccess Grameen Ltd.\* | 1166 |  | 13737 |
|  Differ Group Auto Ltd.\* (a) | 166000 |  | 33201 |
|  Gentera SAB de CV | 26941 |  | 27635 |
|  JMT Network Services PCL, NVDR | 16500 |  | 28179 |
|  Krungthai Card PCL, NVDR | 21200 |  | 31750 |
|  Lufax Holding Ltd., ADR | 16711 |  | 26570 |
|  Mahindra & Mahindra Financial Services Ltd. | 14562 |  | 35535 |
|  Manappuram Finance Ltd. | 214365 |  | 272690 |
|  Muangthai Capital PCL, NVDR | 16500 |  | 15715 |
|  Muthoot Finance Ltd. | 2226 |  | 28060 |
|  Ngern Tid Lor PCL, NVDR | 23692 |  | 16185 |
|  Poonawalla Fincorp Ltd. | 5720 |  | 21725 |
|  Ratchthani Leasing PCL, NVDR | 203500 |  | 23954 |
|  Samsung Card Co. Ltd. | 1140 |  | 24730 |
|  SBI Cards & Payment Services Ltd. | 4949 |  | 49423 |
|  Shriram City Union Finance Ltd. | 717 |  | 15803 |
|  Shriram Transport Finance Co. Ltd. | 2795 |  | 41502 |
|  Srisawad Corp. PCL, NVDR | 26403 |  | 28443 |
|  Sundaram Finance Ltd. | 1445 |  | 41047 |
|  Transaction Capital Ltd. | 16120 |  | 36042 |
|  Yulon Finance Corp. | 4248 |  | 17995 |
|  |  |  | **1828303** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** |
|  Cheng Loong Corp. | 16000 | $13010 |
|  Klabin SA | 24552 | 101160 |
|  Polyplex Thailand PCL, NVDR | 161700 | 100266 |
|  SCG Packaging PCL, NVDR | 32800 | 44813 |
|  Taiwan Hon Chuan Enterprise Co. Ltd. | 107000 | 276943 |
|  Ton Yi Industrial Corp. | 295000 | 151975 |
|  |  | **688167** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  China Tobacco International HK Co. Ltd.(b) | 7000 | 6742 |
|  Wuchan Zhongda Group Co. Ltd., Class A | 13800 | 7885 |
|  Xinhua Winshare Publishing and Media Co. Ltd., Class H(a) | 147000 | 88763 |
|  |  | **103390** |
| **Diversified Consumer Services – 1.3%** | **Diversified Consumer Services – 1.3%** | **Diversified Consumer Services – 1.3%** |
|  Advtech Ltd. | 24310 | 23546 |
|  China Education Group Holdings Ltd.(b) | 343000 | 200560 |
|  Cogna Educacao\* | 52400 | 32855 |
|  Fu Shou Yuan International Group Ltd. | 55000 | 27465 |
|  Humansoft Holding Co. KSC | 1431 | 15532 |
|  Lung Yen Life Service Corp. | 2000 | 2191 |
|  MegaStudyEdu Co. Ltd. | 385 | 23190 |
|  New Oriental Education & Technology Group, Inc.\* | 597800 | 1463686 |
|  Offcn Education Technology Co. Ltd., Class A\* | 4700 | 2801 |
|  TAL Education Group, ADR\* (a) | 197470 | 930084 |
|  YDUQS Participacoes SA | 10500 | 32277 |
|  |  | **2754187** |
| **Diversified Financial Services – 1.2%** | **Diversified Financial Services – 1.2%** | **Diversified Financial Services – 1.2%** |
|  AVIC Industry-Finance Holdings Co. Ltd., Class A | 23500 | 9756 |
|  Bajaj Finserv Ltd. | 6488 | 132264 |
|  Bajaj Holdings & Investment Ltd. | 574 | 46186 |
|  Chailease Holding Co. Ltd. | 27177 | 125669 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 247

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** |
|  Corp. Financiera Colombiana SA\* | 3252 | $| 10722 |
|  Far East Horizon Ltd.(a) | 53000 |  | 40915 |
|  FirstRand Ltd. | 97236 |  | 340478 |
|  Galaxy Cosmos Mezz plc\* | 2333 |  | 377 |
|  Genertec Universal Medical Group Co. Ltd.(a) (b) | 326000 |  | 136217 |
|  Grupo de Inversiones Suramericana SA | 4400 |  | 35871 |
|  Grupo de Inversiones Suramericana SA (Preference) | 3587 |  | 10034 |
|  Housing Development Finance Corp. Ltd. | 31505 |  | 940002 |
|  Indian Railway Finance Corp. Ltd.(b) | 34250 |  | 9372 |
|  L&T Finance Holdings Ltd. | 26381 |  | 25846 |
|  Meritz Financial Group, Inc. | 947 |  | 14427 |
|  Metro Pacific Investments Corp. | 381000 |  | 24063 |
|  National Investments Co. KSCP | 27240 |  | 21018 |
|  NICE Holdings Co. Ltd. | 6432 |  | 55765 |
|  Piramal Enterprises Ltd. | 2112 |  | 21672 |
|  Power Finance Corp. Ltd. | 35812 |  | 49861 |
|  REC Ltd. | 29397 |  | 36419 |
|  Remgro Ltd. | 7469 |  | 55562 |
|  Shandong Hi-Speed Holdings Group Ltd.\* (a) | 49500 |  | 20494 |
|  Yuanta Financial Holding Co. Ltd. | 376580 |  | 230231 |
|  |  |  | **2393221** |
| **Diversified Telecommunication Services – 1.1%** | **Diversified Telecommunication Services – 1.1%** | **Diversified Telecommunication Services – 1.1%** | **Diversified Telecommunication Services – 1.1%** |
|  AL Yah Satellite Communications Co. PJSC | 43340 |  | 32331 |
|  China Tower Corp. Ltd., Class H(b) | 784000 |  | 70911 |
|  Chunghwa Telecom Co. Ltd. | 67000 |  | 230801 |
|  CITIC Telecom International Holdings Ltd. | 637000 |  | 188264 |
|  Converge Information and Communications Technology Solutions, Inc.\* | 60500 |  | 12862 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |
|  Emirates Telecommunications Group Co. PJSC | 60059 | $| 421863 |
|  Hellenic Telecommunications Organization SA | 2597 |  | 40811 |
|  HFCL Ltd. | 22055 |  | 22034 |
|  Indus Towers Ltd. | 25442 |  | 57014 |
|  KT Corp. | 3590 |  | 92242 |
|  LG Uplus Corp. | 7465 |  | 60005 |
|  Magyar Telekom Telecommunications plc | 176244 |  | 126159 |
|  Oi SA\* | 268200 |  | 12778 |
|  Ooredoo QPSC | 18114 |  | 48596 |
|  Operadora De Sites Mexicanos SAB de CV, Series A-1(a) | 22200 |  | 24114 |
|  Rostelecom PJSC‡ | 33770 |  |  |
|  Rostelecom PJSC (Preference)‡ | 15392 |  |  |
|  Sarana Menara Nusantara Tbk. PT | 315700 |  | 23378 |
|  Saudi Telecom Co. | 29562 |  | 317841 |
|  Tata Communications Ltd. | 1646 |  | 25034 |
|  Tata Teleservices Maharashtra Ltd.\* | 6148 |  | 7572 |
|  Telefonica Brasil SA | 11677 |  | 91929 |
|  Telekom Malaysia Bhd. | 36100 |  | 42453 |
|  Telkom Indonesia Persero Tbk. PT | 858600 |  | 241658 |
|  Telkom SA SOC Ltd.\* | 8100 |  | 16092 |
|  TIME dotCom Bhd. | 9000 |  | 8661 |
|  Tower Bersama Infrastructure Tbk. PT | 121300 |  | 19131 |
|  True Corp. PCL, NVDR | 491200 |  | 64013 |
|  Turk Telekomunikasyon A/S | 19746 |  | 13151 |
|  |  |  | **2311698** |
| **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** |
|  Adani Transmission Ltd.\* | 5049 |  | 204253 |
|  Alupar Investimento SA | 3500 |  | 18857 |
|  Celsia SA ESP | 215551 |  | 122492 |
|  Centrais Eletricas Brasileiras SA | 34300 |  | 325661 |
|  Centrais Eletricas Brasileiras SA (Preference), Class B | 8481 |  | 86180 |
|  CESC Ltd. | 251900 |  | 233558 |

---

*See Accompanying Notes to the Financial Statements.* 

248 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  CEZ A/S | 3113 | $| 101795 |
|  Cia de Transmissao de Energia Eletrica Paulista (Preference) | 5200 |  | 24279 |
|  Cia Energetica de Minas Gerais | 9356 |  | 30829 |
|  Cia Energetica de Minas Gerais (Preference) | 46802 |  | 101413 |
|  Cia Paranaense de Energia | 5500 |  | 38562 |
|  CPFL Energia SA | 4700 |  | 31726 |
|  EDP – Energias do Brasil SA | 9400 |  | 41328 |
|  Enel Americas SA | 529169 |  | 52412 |
|  Enel Chile SA | 829052 |  | 29163 |
|  Energisa SA | 4800 |  | 44357 |
|  Enerjisa Enerji A/S(b) | 7676 |  | 8459 |
|  Equatorial Energia SA | 24500 |  | 140213 |
|  Federal Grid Co. Unified Energy System PJSC\* ‡ | 12705298 |  |  |
|  Holding Co. ADMIE IPTO SA | 39169 |  | 64882 |
|  Inter RAO UES PJSC‡ | 1596292 |  |  |
|  Interconexion Electrica SA ESP | 12936 |  | 51048 |
|  Korea Electric Power Corp.\* | 7595 |  | 89309 |
|  Manila Electric Co. | 5840 |  | 30374 |
|  Mosenergo PJSC‡ | 4455000 |  |  |
|  Neoenergia SA | 4700 |  | 14860 |
|  Power Grid Corp. of India Ltd. | 106085 |  | 292390 |
|  Public Power Corp. SA\* | 2126 |  | 13427 |
|  ROSSETI PJSC\* ‡ | 1466436 |  |  |
|  RusHydro PJSC‡ | 2361000 |  |  |
|  Saudi Electricity Co. | 23618 |  | 169708 |
|  SGC Energy Co. Ltd. | 2326 |  | 51273 |
|  SJVN Ltd. | 226919 |  | 96083 |
|  Synergy Grid & Development Phils, Inc. | 477200 |  | 98652 |
|  Tata Power Co. Ltd. (The) | 32585 |  | 88964 |
|  Tenaga Nasional Bhd. | 90100 |  | 160457 |
|  Torrent Power Ltd. | 4645 |  | 28301 |
|  Transmissora Alianca de Energia Eletrica SA | 5000 |  | 38296 |
|  |  |  | **2923561** |
| **Electrical Equipment – 1.1%** | **Electrical Equipment – 1.1%** | **Electrical Equipment – 1.1%** | **Electrical Equipment – 1.1%** |
|  ABB India Ltd. | 1088 |  | 40085 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** |
|  AcBel Polytech, Inc. | 146000 | $125055 |
|  Amara Raja Batteries Ltd. | 2700 | 16734 |
|  Bharat Heavy Electricals Ltd. | 21300 | 19054 |
|  Bizlink Holding, Inc. | 2000 | 15300 |
|  CG Power & Industrial Solutions Ltd.\* | 12320 | 38696 |
|  Chicony Power Technology Co. Ltd. | 65000 | 141004 |
|  China High Speed Transmission Equipment Group Co. Ltd.\* (a) | 147000 | 59737 |
|  Chung-Hsin Electric & Machinery Manufacturing Corp. | 21000 | 32195 |
|  CS Wind Corp. | 581 | 23983 |
|  Dongfang Electric Corp. Ltd., Class A | 5000 | 15900 |
|  Doosan Enerbility Co. Ltd.\* | 7146 | 66471 |
|  Doosan Fuel Cell Co. Ltd.\* | 690 | 13200 |
|  Ecopro BM Co. Ltd. | 828 | 66905 |
|  ElSewedy Electric Co.\* | 195813 | 69082 |
|  Fangda Carbon New Material Co. Ltd., Class A\* | 5300 | 4364 |
|  Finolex Cables Ltd. | 3245 | 20444 |
|  Gotion High-tech Co. Ltd., Class A | 4600 | 18939 |
|  Graphite India Ltd. | 5 | 21 |
|  Gulf Cable & Electrical Industries Co. KSCP | 4140 | 16106 |
|  Hangzhou Steam Turbine Power Group Co. Ltd., Class B | 12800 | 17513 |
|  Havells India Ltd. | 4450 | 65387 |
|  Hitachi Energy India Ltd. | 371 | 14182 |
|  HUA ENG Wire & Cable Co. Ltd. | 147000 | 58622 |
|  Hyosung Heavy Industries Corp.\* | 1813 | 73057 |
|  Hyundai Electric & Energy System Co. Ltd.\* | 1285 | 30987 |
|  Jiangsu Zhongtian Technology Co. Ltd., Class A | 10000 | 30102 |
|  KEI Industries Ltd. | 1595 | 31123 |
|  Korea Electric Terminal Co. Ltd. | 2989 | 108695 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 249

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** |
|  LG Energy Solution Ltd.\* | 686 | $254279 |
|  LS Corp. | 889 | 41503 |
|  LS Electric Co. Ltd. | 456 | 17607 |
|  Ming Yang Smart Energy Group Ltd., Class A | 4500 | 15352 |
|  NARI Technology Co. Ltd., Class A | 10000 | 33431 |
|  Ningbo Ronbay New Energy Technology Co. Ltd., Class A | 1600 | 17167 |
|  Phihong Technology Co. Ltd.\* | 17000 | 18861 |
|  Polycab India Ltd. | 990 | 33218 |
|  Shanghai Electric Group Co. Ltd., Class A\* | 24000 | 12759 |
|  Shanghai Electric Group Co. Ltd., Class H\* | 94000 | 18321 |
|  Shihlin Electric & Engineering Corp. | 13000 | 22068 |
|  Suzlon Energy Ltd.\* | 329900 | 31684 |
|  Ta Ya Electric Wire & Cable | 42018 | 21581 |
|  Taihan Electric Wire Co. Ltd.\* | 11376 | 11979 |
|  Tatung Co. Ltd.\* | 42000 | 40798 |
|  TBEA Co. Ltd., Class A | 8500 | 23770 |
|  Teco Electric and Machinery Co. Ltd. | 22000 | 19458 |
|  V-Guard Industries Ltd. | 11448 | 35404 |
|  Voltronic Power Technology Corp. | 1458 | 59275 |
|  Walsin Lihwa Corp. | 83665 | 92824 |
|  WEG SA | 24500 | 188072 |
|  Xinjiang Goldwind Science & Technology Co. Ltd., Class A | 10600 | 15177 |
|  Xinjiang Goldwind Science & Technology Co. Ltd., Class H(a) | 15000 | 13013 |
|  Zhefu Holding Group Co. Ltd., Class A | 21200 | 11357 |
|  Zhejiang Chint Electrics Co. Ltd., Class A | 4700 | 16357 |
|  Zhuzhou CRRC Times Electric Co. Ltd., Class H | 11800 | 51184 |
|  |  | **2349442** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Electronic Equipment, Instruments & Components – 3.8%** | **Electronic Equipment, Instruments & Components – 3.8%** | **Electronic Equipment, Instruments & Components – 3.8%** |
|  AAC Technologies Holdings, Inc.\* (a) | 14000 | $25646 |
|  Apex International Co. Ltd. | 62000 | 95052 |
|  Asia Optical Co., Inc. | 3000 | 5335 |
|  AUO Corp. | 196000 | 102798 |
|  Aurora Corp. | 4900 | 11846 |
|  Avary Holding Shenzhen Co. Ltd., Class A | 4700 | 19158 |
|  BH Co. Ltd. | 9332 | 157886 |
|  BOE Technology Group Co. Ltd., Class A | 78900 | 36106 |
|  Career Technology MFG. Co. Ltd.\* | 147000 | 109945 |
|  Chang Wah Electromaterials, Inc. | 22000 | 20858 |
|  Cheng Uei Precision Industry Co. Ltd. | 136000 | 141814 |
|  China Railway Signal & Communication Corp. Ltd., Class A | 31500 | 19551 |
|  Chroma ATE, Inc. | 8000 | 43820 |
|  Compeq Manufacturing Co. Ltd. | 41000 | 55604 |
|  Coretronic Corp. | 113000 | 175343 |
|  Co-Tech Development Corp. | 77000 | 104188 |
|  Cowell e Holdings, Inc.\* | 12000 | 14675 |
|  Daejoo Electronic Materials Co. Ltd. | 250 | 15778 |
|  Delta Electronics Thailand PCL, NVDR | 9800 | 149343 |
|  Delta Electronics, Inc. | 34000 | 271705 |
|  Dreamtech Co. Ltd. | 11297 | 76056 |
|  Dynapack International Technology Corp. | 49000 | 104014 |
|  E Ink Holdings, Inc. | 15000 | 95663 |
|  Elite Material Co. Ltd. | 5000 | 22733 |
|  FLEXium Interconnect, Inc.\* | 10000 | 28427 |
|  Foxconn Industrial Internet Co. Ltd., Class A | 34300 | 38536 |
|  Foxconn Technology Co. Ltd. | 32000 | 44888 |
|  General Interface Solution Holding Ltd. | 5000 | 12072 |
|  Genius Electronic Optical Co. Ltd. | 2237 | 20862 |

---

*See Accompanying Notes to the Financial Statements.* 

250 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** |
|  Global Brands Manufacture Ltd. | 98800 | $79107 |
|  GoerTek, Inc., Class A | 3800 | 11288 |
|  Gold Circuit Electronics Ltd. | 9000 | 23909 |
|  Hana Microelectronics PCL, NVDR | 24900 | 22735 |
|  Hannstar Board Corp. | 125000 | 111529 |
|  HannStar Display Corp. | 94000 | 33402 |
|  Hengdian Group DMEGC Magnetics Co. Ltd., Class A | 5100 | 12382 |
|  Hollysys Automation Technologies Ltd. | 22834 | 363974 |
|  Holy Stone Enterprise Co. Ltd. | 56000 | 151720 |
|  Hon Hai Precision Industry Co. Ltd. | 356000 | 1132439 |
|  Honeywell Automation India Ltd. | 32 | 15205 |
|  Huagong Tech Co. Ltd., Class A | 4700 | 10799 |
|  Iljin Materials Co. Ltd. | 477 | 20293 |
|  Innolux Corp. | 310415 | 114157 |
|  Jay Mart PCL, NVDR | 16500 | 19617 |
|  KCE Electronics PCL, NVDR | 19100 | 21077 |
|  Kingboard Holdings Ltd. | 24500 | 60424 |
|  Kingboard Laminates Holdings Ltd.(a) | 27500 | 21965 |
|  Korea Circuit Co. Ltd.\* | 5044 | 50814 |
|  L&F Co. Ltd.\* | 428 | 67605 |
|  Largan Precision Co. Ltd. | 2000 | 114827 |
|  LG Display Co. Ltd. | 6360 | 56927 |
|  LG Innotek Co. Ltd. | 441 | 91794 |
|  Lingyi iTech Guangdong Co., Class A\* | 15900 | 10304 |
|  Lotes Co. Ltd. | 1299 | 31283 |
|  Luxshare Precision Industry Co. Ltd., Class A | 9800 | 38268 |
|  Mcnex Co. Ltd. | 657 | 12661 |
|  MH Development Ltd.\* ‡ | 22000 |  |
|  Nan Ya Printed Circuit Board Corp. | 4000 | 26255 |
|  OFILM Group Co. Ltd., Class A\* | 4700 | 3014 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** |
|  Pan-International Industrial Corp. | 24000 | $23723 |
|  Park Systems Corp. | 200 | 15402 |
|  Partron Co. Ltd. | 19277 | 110970 |
|  Primax Electronics Ltd. | 160000 | 268632 |
|  Redington Ltd. | 230055 | 379916 |
|  Samsung Electro-Mechanics Co. Ltd. | 1666 | 141519 |
|  Samsung SDI Co. Ltd. | 931 | 481693 |
|  Sang-A Frontec Co. Ltd. | 275 | 4884 |
|  Shanghai Friendess Electronic Technology Corp. Ltd., Class A | 700 | 19755 |
|  Shengyi Technology Co. Ltd., Class A | 4700 | 8932 |
|  Shenzhen Kaifa Technology Co. Ltd., Class A | 4700 | 7367 |
|  Shenzhen Kinwong Electronic Co. Ltd., Class A | 5000 | 13879 |
|  Simplo Technology Co. Ltd. | 5200 | 41393 |
|  Sinbon Electronics Co. Ltd. | 3000 | 23322 |
|  SOLUM Co. Ltd.\* | 1802 | 21822 |
|  Solus Advanced Materials Co. Ltd. | 377 | 8893 |
|  Sunny Optical Technology Group Co. Ltd. | 12200 | 105761 |
|  Supreme Electronics Co. Ltd. | 166331 | 171119 |
|  Synnex Technology International Corp. | 49000 | 79988 |
|  Taiwan PCB Techvest Co. Ltd. | 98000 | 99148 |
|  Taiwan Union Technology Corp. | 99000 | 134724 |
|  Tianma Microelectronics Co. Ltd., Class A | 9400 | 11385 |
|  Tong Hsing Electronic Industries Ltd. | 3022 | 16225 |
|  Tripod Technology Corp. | 14000 | 38756 |
|  Truly International Holdings Ltd. | 686000 | 83895 |
|  TXC Corp. | 14000 | 33151 |
|  Unimicron Technology Corp. | 22000 | 85003 |
|  Universal Scientific Industrial Shanghai Co. Ltd., Class A | 4700 | 11224 |
|  VS Industry Bhd. | 137700 | 24610 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 251

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** | **Electronic Equipment, Instruments &<br>Components – (continued)** |
|  Wah Lee Industrial Corp. | 68640 | $| 171267 |
|  Walsin Technology Corp. | 9378 |  | 22992 |
|  Weikeng Industrial Co. Ltd. | 138000 |  | 110066 |
|  Wingtech Technology Co. Ltd., Class A | 3100 |  | 20337 |
|  Wintek Corp.\* ‡ | 64000 |  |  |
|  WPG Holdings Ltd. | 49440 |  | 67434 |
|  WT Microelectronics Co. Ltd. | 14000 |  | 25330 |
|  Wuhan Guide Infrared Co. Ltd., Class A | 9212 |  | 14654 |
|  WUS Printed Circuit Kunshan Co. Ltd., Class A | 5170 |  | 7714 |
|  Yageo Corp. | 10347 |  | 117848 |
|  Zhejiang Dahua Technology Co. Ltd., Class A | 2900 |  | 4601 |
|  Zhen Ding Technology Holding Ltd. | 17150 |  | 56417 |
|  |  |  | **7835227** |
| **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** |
|  ADNOC Drilling Co. PJSC | 87465 |  | 79772 |
|  Bumi Armada Bhd.\* | 1208600 |  | 99694 |
|  China Oilfield Services Ltd., Class A | 5000 |  | 11502 |
|  China Oilfield Services Ltd., Class H(a) | 28000 |  | 31532 |
|  Dialog Group Bhd. | 51700 |  | 22526 |
|  Gulf International Services QSC\* | 45210 |  | 22619 |
|  Yinson Holdings Bhd. | 35800 |  | 16053 |
|  |  |  | **283698** |
| **Entertainment – 0.7%** | **Entertainment – 0.7%** | **Entertainment – 0.7%** | **Entertainment – 0.7%** |
|  37 Interactive Entertainment Network Technology Group Co. Ltd. | 4700 |  | 9331 |
|  Alibaba Pictures Group Ltd.\* | 540000 |  | 19950 |
|  Bilibili, Inc., Class Z\* (a) | 3920 |  | 33907 |
|  China Ruyi Holdings Ltd.\* (a) | 142799 |  | 22375 |
|  CJ CGV Co. Ltd.\* | 1732 |  | 16415 |
|  CJ ENM Co. Ltd. | 140 |  | 7214 |
|  Com2uSCorp | 133 |  | 6639 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Entertainment – (continued)** | **Entertainment – (continued)** | **Entertainment – (continued)** | **Entertainment – (continued)** |
|  Devsisters Co. Ltd. | 2254 | $| 77219 |
|  Fire Rock Holdings Ltd.\* ‡ (a) | 106000 |  | 7362 |
|  Giantstep, Inc.\* | 935 |  | 11224 |
|  HYBE Co. Ltd.\* | 364 |  | 30920 |
|  International Games System Co. Ltd. | 2000 |  | 21817 |
|  iQIYI, Inc., ADR\* (a) | 13592 |  | 27456 |
|  JYP Entertainment Corp. | 489 |  | 19053 |
|  Kakao Games Corp.\* | 956 |  | 26544 |
|  Kingsoft Corp. Ltd. | 16000 |  | 48409 |
|  NCSoft Corp. | 281 |  | 76935 |
|  Neowiz\* | 5572 |  | 141212 |
|  NetDragon Websoft Holdings Ltd. | 98000 |  | 164543 |
|  NetEase, Inc. | 31400 |  | 342407 |
|  Netmarble Corp.(b) | 410 |  | 12837 |
|  NHN Corp.\* | 630 |  | 10150 |
|  Pearl Abyss Corp.\* | 936 |  | 27335 |
|  Perfect World Co. Ltd., Class A | 4100 |  | 6398 |
|  PVR Ltd.\* | 1617 |  | 34673 |
|  Saregama India Ltd. | 2498 |  | 11329 |
|  SM Entertainment Co. Ltd. | 475 |  | 23709 |
|  SMI Holdings Group Ltd.\* ‡ | 72000 |  |  |
|  Studio Dragon Corp.\* | 385 |  | 18487 |
|  Tencent Music Entertainment Group, ADR\* | 7897 |  | 28508 |
|  Webzen, Inc.\* | 440 |  | 4618 |
|  Wemade Co. Ltd. | 488 |  | 15194 |
|  XD, Inc.\* (b) | 8000 |  | 13860 |
|  XPEC Entertainment, Inc.\* ‡ | 14800 |  |  |
|  YG Entertainment, Inc. | 605 |  | 18157 |
|  Zhejiang Century Huatong Group Co. Ltd., Class A\* | 11280 |  | 5703 |
|  |  |  | **1341890** |
| **Equity Real Estate Investment Trusts (REITs) – 1.3%** | **Equity Real Estate Investment Trusts (REITs) – 1.3%** | **Equity Real Estate Investment Trusts (REITs) – 1.3%** | **Equity Real Estate Investment Trusts (REITs) – 1.3%** |
|  AREIT, Inc. | 30000 |  | 16048 |
|  Axis REIT | 70600 |  | 27924 |
|  Concentradora Fibra Danhos SA de CV | 328309 |  | 405238 |
|  CPN Retail Growth Leasehold REIT | 44100 |  | 21436 |
|  Embassy Office Parks REIT | 9048 |  | 37643 |

---

*See Accompanying Notes to the Financial Statements.* 

252 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Emlak Konut Gayrimenkul Yatirim Ortakligi A/S | 786989 | $| 186564 |
|  Equites Property Fund Ltd.(a) | 27560 |  | 23545 |
|  ESR Kendall Square REIT Co. Ltd. | 3896 |  | 9751 |
|  Fibra Uno Administracion SA de CV | 93100 |  | 108442 |
|  Fortress REIT Ltd., Class A\* | 31313 |  | 17601 |
|  Growthpoint Properties Ltd.(a) | 106428 |  | 74996 |
|  Hyprop Investments Ltd.\* | 138752 |  | 279580 |
|  IGB REIT | 6200 |  | 2059 |
|  Industrials REIT Ltd. | 16625 |  | 24787 |
|  Investec Property Fund Ltd. | 30397 |  | 16871 |
|  Is Gayrimenkul Yatirim Ortakligi A/S\* | 20286 |  | 8309 |
|  JR Global Reit | 7119 |  | 21065 |
|  KLCCP Stapled Group | 6900 |  | 9676 |
|  Korea Asset In Trust Co. Ltd. | 24255 |  | 49380 |
|  LOTTE Reit Co. Ltd. | 1828 |  | 4607 |
|  Mindspace Business Parks REIT(b) | 4100 |  | 17597 |
|  MREIT, Inc. | 42200 |  | 9146 |
|  Pavilion REIT | 15000 |  | 3934 |
|  PLA Administradora Industrial S de RL de CV | 303650 |  | 424673 |
|  Prologis Property Mexico SA de CV(a) | 27610 |  | 70774 |
|  Redefine Properties Ltd. | 244978 |  | 54388 |
|  Resilient REIT Ltd.(a) | 129360 |  | 360469 |
|  RL Commercial REIT, Inc. | 273500 |  | 23787 |
|  Sinpas Gayrimenkul Yatirim Ortakligi A/S\* | 212613 |  | 61831 |
|  Vukile Property Fund Ltd. | 375536 |  | 274845 |
|  Yuexiu REIT | 72610 |  | 12487 |
|  |  |  | **2659453** |
| **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** |
|  Abdullah Al Othaim Markets Co. | 363 |  | 10974 |
|  Al Meera Consumer Goods Co. QSC | 1990 |  | 9563 |
|  Atacadao SA | 13900 |  | 51550 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** |
|  Avenue Supermarts Ltd.\* (b) | 2681 | $| 139945 |
|  Berli Jucker PCL | 500 |  | 450 |
|  Berli Jucker PCL, NVDR | 13800 |  | 12419 |
|  BGF retail Co. Ltd. | 239 |  | 31292 |
|  Bid Corp. Ltd. | 5670 |  | 91189 |
|  BIM Birlesik Magazalar A/S | 13261 |  | 95521 |
|  Cencosud SA | 44247 |  | 59539 |
|  Cia Brasileira de Distribuicao\* | 66013 |  | 277400 |
|  CJ Freshway Corp. | 2121 |  | 47573 |
|  Clicks Group Ltd. | 4165 |  | 70540 |
|  CP ALL PCL, NVDR | 83800 |  | 132107 |
|  DaShenLin Pharmaceutical Group Co. Ltd., Class A | 3600 |  | 17979 |
|  Dis-Chem Pharmacies Ltd.(b) | 6949 |  | 12720 |
|  Dongsuh Cos., Inc. | 859 |  | 12302 |
|  E-MART, Inc. | 550 |  | 32665 |
|  Great Tree Pharmacy Co. Ltd. | 1257 |  | 10552 |
|  Grupo Comercial Chedraui SA de CV | 7056 |  | 28389 |
|  GS Retail Co. Ltd. | 1332 |  | 23752 |
|  Hyundai Greenfood Co. Ltd. | 19194 |  | 87720 |
|  InRetail Peru Corp.(b) | 406 |  | 14007 |
|  Magnit PJSC | 2296 |  |  |
|  Migros Ticaret A/S\* | 6250 |  | 40652 |
|  Pick n Pay Stores Ltd. | 6784 |  | 21794 |
|  President Chain Store Corp. | 11000 |  | 91489 |
|  Puregold Price Club, Inc. | 26060 |  | 13491 |
|  Raia Drogasil SA | 19100 |  | 95769 |
|  Sendas Distribuidora SA | 14996 |  | 56643 |
|  Shoprite Holdings Ltd. | 8918 |  | 113504 |
|  Siam Makro PCL, NVDR | 11400 |  | 10783 |
|  Sok Marketler Ticaret A/S\* | 126567 |  | 160838 |
|  SPAR Group Ltd. (The) | 4873 |  | 41299 |
|  Sumber Alfaria Trijaya Tbk. PT | 344600 |  | 62303 |
|  Sun Art Retail Group Ltd. | 24000 |  | 3822 |
|  Wal-Mart de Mexico SAB de CV | 86100 |  | 331968 |
|  |  |  | **2314503** |
| **Food Products – 2.8%** | **Food Products – 2.8%** | **Food Products – 2.8%** | **Food Products – 2.8%** |
|  Agthia Group PJSC | 121900 |  | 148349 |
|  Alicorp SAA | 177240 |  | 280119 |
|  Almarai Co. JSC | 3835 |  | 57460 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 253

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Anjoy Foods Group Co. Ltd., Class A | 500 | $9202 |
|  Astra Agro Lestari Tbk. PT | 20800 | 11335 |
|  Avanti Feeds Ltd. | 507 | 2703 |
|  AVI Ltd. | 14737 | 58916 |
|  Balrampur Chini Mills Ltd. | 3850 | 14695 |
|  Beijing Dabeinong Technology Group Co. Ltd., Class A\* | 5300 | 6652 |
|  Bombay Burmah Trading Co. | 1061 | 11193 |
|  BRF SA\* | 15300 | 36623 |
|  Britannia Industries Ltd. | 1949 | 88684 |
|  Century Pacific Food, Inc. | 17700 | 7269 |
|  Charoen Pokphand Enterprise | 10300 | 24198 |
|  Charoen Pokphand Foods PCL, NVDR | 108500 | 71982 |
|  Charoen Pokphand Indonesia Tbk. PT | 119900 | 42856 |
|  Cherkizovo Group PJSC‡ | 2594 |  |
|  China Feihe Ltd.(a) (b) | 101000 | 58157 |
|  China Huiyuan Juice Group Ltd.\* ‡ | 24000 |  |
|  China Mengniu Dairy Co. Ltd.\* | 49000 | 156990 |
|  China Modern Dairy Holdings Ltd.(a) | 1043000 | 106295 |
|  China Youran Dairy Group Ltd.\* (a) (b) | 490000 | 98626 |
|  Chongqing Fuling Zhacai Group Co. Ltd., Class A | 2400 | 7402 |
|  CJ CheilJedang Corp. | 223 | 64812 |
|  CJ CheilJedang Corp. (Preference) | 104 | 12083 |
|  COFCO Joycome Foods Ltd.\* (a) (b) | 1127000 | 236890 |
|  Daesang Corp. | 7869 | 115733 |
|  Dali Foods Group Co. Ltd.(b) | 45500 | 18722 |
|  Dongwon F&B Co. Ltd. | 522 | 47273 |
|  Dongwon Industries Co. Ltd. | 490 | 79118 |
|  Foshan Haitian Flavouring & Food Co. Ltd., Class A | 4900 | 40067 |
|  Garudafood Putra Putri Jaya Tbk. PT | 463100 | 15439 |
|  Genting Plantations Bhd. | 10400 | 13462 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Great Wall Enterprise Co. Ltd. | 8400 | $10480 |
|  Gruma SAB de CV, Class B | 3765 | 43595 |
|  Grupo Bimbo SAB de CV, Series A | 26400 | 102028 |
|  Grupo Nutresa SA | 2911 | 31601 |
|  Guangdong Haid Group Co. Ltd., Class A | 3400 | 26902 |
|  Harim Holdings Co. Ltd. | 3492 | 17258 |
|  Heilongjiang Agriculture Co. Ltd., Class A | 5200 | 9832 |
|  Henan Shuanghui Investment & Development Co. Ltd., Class A | 5000 | 15606 |
|  Huishan Dairy\* ‡ | 158000 |  |
|  Indofood CBP Sukses Makmur Tbk. PT | 51800 | 32297 |
|  Indofood Sukses Makmur Tbk. PT | 127400 | 52683 |
|  Industrias Bachoco SAB de CV, Series B(a) | 65444 | 266768 |
|  Inner Mongolia Yili Industrial Group Co. Ltd., Class A | 8200 | 28357 |
|  IOI Corp. Bhd. | 58800 | 50741 |
|  Japfa Comfeed Indonesia Tbk. PT | 2136400 | 189704 |
|  JBS SA | 19700 | 93709 |
|  Kuala Lumpur Kepong Bhd. | 10631 | 48748 |
|  Lien Hwa Industrial Holdings Corp. | 16170 | 23360 |
|  Lotte Confectionery Co. Ltd. | 1666 | 152045 |
|  M Dias Branco SA\* | 5200 | 43108 |
|  Maeil Dairies Co. Ltd. | 1764 | 58327 |
|  Marfrig Global Foods SA | 10600 | 21615 |
|  Marico Ltd. | 8820 | 55891 |
|  Mayora Indah Tbk. PT | 83900 | 12910 |
|  Mezzan Holding Co. KSCC | 47576 | 55601 |
|  Minerva SA | 102900 | 268269 |
|  Monde Nissin Corp.(b) | 107400 | 21647 |
|  Muyuan Foods Co. Ltd., Class A | 7320 | 46917 |
|  Namchow Holdings Co. Ltd. | 68000 | 91377 |
|  National Agriculture Development Co. (The)\* | 2623 | 18219 |
|  Nestle India Ltd. | 637 | 156703 |

---

*See Accompanying Notes to the Financial Statements.* 

254 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Nestle Malaysia Bhd. | 900 | $25317 |
|  New Hope Liuhe Co. Ltd., Class A\* | 9000 | 15895 |
|  NongShim Co. Ltd. | 56 | 11873 |
|  Orion Corp. | 500 | 35628 |
|  Orion Holdings Corp. | 9136 | 91716 |
|  Ottogi Corp. | 15 | 4649 |
|  Perusahaan Perkebunan London Sumatra Indonesia Tbk. PT | 1195300 | 86597 |
|  PPB Group Bhd. | 14080 | 49733 |
|  QL Resources Bhd. | 25395 | 27501 |
|  Qurain Petrochemical Industries Co. | 15408 | 12535 |
|  Samyang Corp. | 1333 | 34718 |
|  Samyang Foods Co. Ltd. | 301 | 23455 |
|  Samyang Holdings Corp. | 2508 | 108986 |
|  San Miguel Food and Beverage, Inc. | 7670 | 4831 |
|  Sao Martinho SA | 3500 | 17989 |
|  Saudia Dairy & Foodstuff Co. | 698 | 43653 |
|  Savola Group (The) | 5537 | 43176 |
|  Sawit Sumbermas Sarana Tbk. PT | 1421000 | 126635 |
|  Shree Renuka Sugars Ltd.\* | 30100 | 19654 |
|  Sime Darby Plantation Bhd. | 54403 | 50629 |
|  Taiwan TEA Corp.\* | 8000 | 5102 |
|  Tata Consumer Products Ltd. | 10407 | 96825 |
|  Thai Union Group PCL, NVDR | 82200 | 38875 |
|  Thaifoods Group PCL, NVDR | 1119900 | 164778 |
|  Tiger Brands Ltd. | 3445 | 34873 |
|  Tingyi Cayman Islands Holding Corp. | 30000 | 46931 |
|  Toly Bread Co. Ltd., Class A | 7420 | 11447 |
|  Tongwei Co. Ltd., Class A | 5500 | 32780 |
|  Tres Tentos Agroindustrial SA | 49000 | 118409 |
|  Ulker Biskuvi Sanayi A/S\* | 57869 | 81813 |
|  Uni-President China Holdings Ltd. | 49000 | 36205 |
|  Uni-President Enterprises Corp. | 80000 | 162619 |
|  Universal Robina Corp. | 13530 | 28484 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Want Want China Holdings Ltd. | 98000 | $| 64419 |
|  Yihai International Holding Ltd.\* (a) | 7000 |  | 11521 |
|  Yuan Longping High-tech Agriculture Co. Ltd., Class A\* | 5100 |  | 10146 |
|  Zad Holding Co. | 3130 |  | 14826 |
|  Zhou Hei Ya International Holdings Co. Ltd.\* (b) | 14000 |  | 6171 |
|  |  |  | **5790997** |
| **Gas Utilities – 0.6%** | **Gas Utilities – 0.6%** | **Gas Utilities – 0.6%** | **Gas Utilities – 0.6%** |
|  Adani Total Gas Ltd. | 4803 |  | 209048 |
|  Aygaz A/S | 4199 |  | 13295 |
|  Beijing Enterprises Holdings Ltd. | 16000 |  | 40602 |
|  China Gas Holdings Ltd. | 88200 |  | 78202 |
|  China Resources Gas Group Ltd. | 24200 |  | 61965 |
|  Daesung Holdings Co. Ltd. | 300 |  | 20787 |
|  ENN Energy Holdings Ltd. | 13300 |  | 132240 |
|  ENN Natural Gas Co. Ltd., Class A | 10000 |  | 21210 |
|  GAIL India Ltd. | 89964 |  | 99226 |
|  Grupo Energia Bogota SA ESP | 91532 |  | 30872 |
|  Gujarat Gas Ltd. | 2679 |  | 16784 |
|  Gujarat State Petronet Ltd. | 13547 |  | 37011 |
|  Indraprastha Gas Ltd. | 4564 |  | 23612 |
|  Korea Gas Corp. | 999 |  | 24406 |
|  Kunlun Energy Co. Ltd. | 118000 |  | 70501 |
|  Mahanagar Gas Ltd.(b) | 1456 |  | 15156 |
|  National Gas & Industrialization Co. | 1155 |  | 16506 |
|  Perusahaan Gas Negara Tbk. PT | 311200 |  | 39405 |
|  Petronas Gas Bhd. | 14700 |  | 53166 |
|  Towngas Smart Energy Co. Ltd.\* (a) | 408000 |  | 142933 |
|  |  |  | **1146927** |
| **Health Care Equipment & Supplies – 0.2%** | **Health Care Equipment & Supplies – 0.2%** | **Health Care Equipment & Supplies – 0.2%** | **Health Care Equipment & Supplies – 0.2%** |
|  Dentium Co. Ltd. | 257 |  | 13766 |
|  DIO Corp.\* | 520 |  | 7246 |
|  Eoflow Co. Ltd.\* | 1734 |  | 19599 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 255

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Hartalega Holdings Bhd. | 30800 | $| 14071 |
|  Jiangsu Yuyue Medical Equipment & Supply Co. Ltd., Class A | 5000 |  | 22299 |
|  Kangji Medical Holdings Ltd.(a) | 25000 |  | 20223 |
|  Kossan Rubber Industries Bhd. | 22800 |  | 6028 |
|  Lifetech Scientific Corp.\* | 110000 |  | 34472 |
|  Microport Cardioflow Medtech Corp.\* (a) (b) | 39000 |  | 11824 |
|  Microport Scientific Corp.\* (a) | 11498 |  | 24285 |
|  Poly Medicure Ltd. | 2864 |  | 31878 |
|  SD Biosensor, Inc. | 990 |  | 20537 |
|  Shandong Weigao Group Medical Polymer Co. Ltd., Class H | 36000 |  | 49621 |
|  Sri Trang Gloves Thailand PCL, NVDR | 62800 |  | 18315 |
|  St Shine Optical Co. Ltd. | 2000 |  | 13097 |
|  Supermax Corp. Bhd. | 681561 |  | 139109 |
|  TaiDoc Technology Corp. | 3000 |  | 15828 |
|  Top Glove Corp. Bhd. | 120100 |  | 20195 |
|  |  |  | **482393** |
| **Health Care Providers & Services – 0.8%** | **Health Care Providers & Services – 0.8%** | **Health Care Providers & Services – 0.8%** | **Health Care Providers & Services – 0.8%** |
|  Al Hammadi Holding | 3792 |  | 45362 |
|  Apollo Hospitals Enterprise Ltd. | 1608 |  | 87755 |
|  Aster DM Healthcare Ltd.\* (b) | 6324 |  | 18893 |
|  Bangkok Chain Hospital PCL, NVDR | 20800 |  | 10110 |
|  Bangkok Dusit Medical Services PCL, NVDR | 72000 |  | 55807 |
|  Bumrungrad Hospital PCL, NVDR | 10100 |  | 60239 |
|  Celltrion Healthcare Co. Ltd. | 1519 |  | 74113 |
|  Chabiotech Co. Ltd.\* | 841 |  | 7793 |
|  Chularat Hospital PCL, NVDR | 101400 |  | 9431 |
|  Cleopatra Hospital\* | 57071 |  | 9193 |
|  CM Hospitalar SA | 5000 |  | 18191 |
|  Dallah Healthcare Co. | 1193 |  | 50926 |
|  Diagnosticos da America SA\* | 990 |  | 3779 |
|  Dr Lal PathLabs Ltd.(b) | 430 |  | 13314 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Dr Sulaiman Al Habib Medical Services Group Co. | 1411 | $85091 |
|  Fleury SA | 3600 | 12761 |
|  Fortis Healthcare Ltd.\* | 11593 | 38857 |
|  Gushengtang Holdings Ltd.\* | 3200 | 13575 |
|  Hapvida Participacoes e Investimentos SA\* (b) | 78400 | 116541 |
|  HLB Life Science Co. Ltd.\* | 3012 | 25691 |
|  Huadong Medicine Co. Ltd., Class A | 3300 | 18506 |
|  Hygeia Healthcare Holdings Co. Ltd.\* (a) (b) | 6400 | 27720 |
|  IHH Healthcare Bhd. | 58800 | 73997 |
|  Jinxin Fertility Group Ltd.(a) (b) | 67500 | 33278 |
|  KPJ Healthcare Bhd. | 14124 | 2450 |
|  Krishna Institute of Medical Sciences Ltd.\* (b) | 1650 | 29607 |
|  Life Healthcare Group Holdings Ltd. | 29257 | 31442 |
|  Max Healthcare Institute Ltd.\* | 12789 | 70498 |
|  Medikaloka Hermina Tbk. PT(b) | 179700 | 17166 |
|  Meinian Onehealth Healthcare Holdings Co. Ltd., Class A\* | 9400 | 5499 |
|  Metro Healthcare Indonesia Tbk. PT\* | 641300 | 20969 |
|  Metropolis Healthcare Ltd.(b) | 1540 | 31474 |
|  Mitra Keluarga Karyasehat Tbk. PT(b) | 100200 | 17731 |
|  Mouwasat Medical Services Co. | 688 | 40099 |
|  Narayana Hrudayalaya Ltd.(b) | 2750 | 26293 |
|  Netcare Ltd. | 70667 | 59910 |
|  Odontoprev SA | 5390 | 8505 |
|  Rede D'Or Sao Luiz SA\* (b) | 14100 | 86445 |
|  Shanghai Pharmaceuticals Holding Co. Ltd., Class A | 4700 | 11321 |
|  Shanghai Pharmaceuticals Holding Co. Ltd., Class H | 23500 | 31853 |
|  Siloam International Hospitals Tbk. PT | 165000 | 11584 |
|  Sinopharm Group Co. Ltd., Class H | 39200 | 74706 |

---

*See Accompanying Notes to the Financial Statements.* 

256 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Thonburi Healthcare Group PCL, NVDR | 16500 | $| 29263 |
|  Topchoice Medical Corp., Class A\* | 500 |  | 8375 |
|  Universal Vision Biotechnology Co. Ltd. | 2100 |  | 16097 |
|  |  |  | **1542210** |
| **Health Care Technology – 0.0%(d)** | **Health Care Technology – 0.0%(d)** | **Health Care Technology – 0.0%(d)** | **Health Care Technology – 0.0%(d)** |
|  Yidu Tech, Inc.\* (b) | 20300 |  | 10292 |
| **Hotels, Restaurants & Leisure – 0.8%** | **Hotels, Restaurants & Leisure – 0.8%** | **Hotels, Restaurants & Leisure – 0.8%** | **Hotels, Restaurants & Leisure – 0.8%** |
|  Abu Dhabi National Hotels | 18200 |  | 19498 |
|  Alsea SAB de CV\* | 24500 |  | 46892 |
|  Ananti, Inc.\* | 2798 |  | 10391 |
|  Asset World Corp. PCL, NVDR | 171900 |  | 27551 |
|  Bloomberry Resorts Corp.\* | 236200 |  | 28532 |
|  Central Plaza Hotel PCL\* | 1600 |  | 2134 |
|  Central Plaza Hotel PCL, NVDR\* | 5700 |  | 7601 |
|  China Travel International Investment Hong Kong Ltd.\* | 122000 |  | 18961 |
|  DoubleUGames Co. Ltd. | 3673 |  | 123641 |
|  EIH Ltd.\* | 8250 |  | 19320 |
|  Genting Bhd. | 68600 |  | 64421 |
|  Genting Malaysia Bhd. | 61100 |  | 35409 |
|  H World Group Ltd. | 24500 |  | 67103 |
|  Haichang Ocean Park Holdings Ltd.\* (a) (b) | 27000 |  | 23905 |
|  Haidilao International Holding Ltd.\* (a) (b) | 21164 |  | 31437 |
|  Hana Tour Service, Inc.\* | 450 |  | 15748 |
|  Helens International Holdings Co. Ltd.\* (a) | 6500 |  | 6252 |
|  Herfy Food Services Co.\* | 1705 |  | 17787 |
|  Indian Hotels Co. Ltd. | 17668 |  | 71246 |
|  Jiumaojiu International Holdings Ltd.(a) (b) | 14000 |  | 21972 |
|  Jollibee Foods Corp. | 10180 |  | 40755 |
|  Jubilant Foodworks Ltd. | 4950 |  | 36474 |
|  Kangwon Land, Inc.\* | 2150 |  | 34715 |
|  Leejam Sports Co. JSC | 1155 |  | 24314 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Lotte Tour Development Co. Ltd.\* | 1961 | $| 12431 |
|  Magnum Bhd. | 19594 |  | 6506 |
|  Minor International PCL, NVDR\* | 48500 |  | 35999 |
|  MK Restaurants Group PCL, NVDR | 4800 |  | 7346 |
|  Nayuki Holdings Ltd.\* (a) (b) | 25000 |  | 12835 |
|  OPAP SA | 3937 |  | 48250 |
|  Paradise Co. Ltd.\* | 421 |  | 4197 |
|  Sapphire Foods India Ltd.\* | 800 |  | 13986 |
|  Seera Group Holding\* | 6600 |  | 33513 |
|  Shenzhen Overseas Chinese Town Co. Ltd., Class A | 22200 |  | 12775 |
|  Sports Toto Bhd. | 367651 |  | 140746 |
|  Tongcheng Travel Holdings Ltd.\* (b) | 18800 |  | 29314 |
|  Travellers International Hotel Group, Inc.\* ‡ | 209900 |  |  |
|  Trip.com Group Ltd.\* | 8650 |  | 190855 |
|  Tsogo Sun Gaming Ltd. | 39263 |  | 24569 |
|  Westlife Development Ltd.\* | 3000 |  | 27102 |
|  Yum China Holdings, Inc. | 6993 |  | 289161 |
|  |  |  | **1685644** |
| **Household Durables – 1.2%** | **Household Durables – 1.2%** | **Household Durables – 1.2%** | **Household Durables – 1.2%** |
|  Amber Enterprises India Ltd.\* | 935 |  | 23325 |
|  AmTRAN Technology Co. Ltd. | 310255 |  | 89256 |
|  Arcelik A/S | 4982 |  | 21063 |
|  Bajaj Electricals Ltd. | 2173 |  | 30689 |
|  Coway Co. Ltd. | 1177 |  | 45693 |
|  Crompton Greaves Consumer Electricals Ltd. | 8232 |  | 36030 |
|  Cuckoo Holdings Co. Ltd. | 2953 |  | 33688 |
|  Cyrela Brazil Realty SA Empreendimentos e Participacoes | 106731 |  | 378331 |
|  Dixon Technologies India Ltd.(b) | 691 |  | 37703 |
|  Ecovacs Robotics Co. Ltd., Class A | 1500 |  | 11982 |
|  Gree Electric Appliances, Inc. of Zhuhai, Class A | 14700 |  | 57744 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 257

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** |
|  Haier Smart Home Co. Ltd., Class A | 10600 | $| 30208 |
|  Haier Smart Home Co. Ltd., Class H | 39200 |  | 98077 |
|  Hang Zhou Great Star Industrial Co. Ltd., Class A\* | 5000 |  | 13201 |
|  Hanssem Co. Ltd. | 303 |  | 7966 |
|  Kinpo Electronics | 50000 |  | 21957 |
|  Konka Group Co. Ltd., Class B | 291800 |  | 73602 |
|  LG Electronics, Inc. | 3383 |  | 193796 |
|  LG Electronics, Inc. (Preference) | 584 |  | 16256 |
|  Lock&Lock Co. Ltd. | 728 |  | 3118 |
|  Merry Electronics Co. Ltd. | 75235 |  | 183753 |
|  Midea Group Co. Ltd., Class A | 9800 |  | 53951 |
|  MRV Engenharia e Participacoes SA | 117600 |  | 228151 |
|  Nien Made Enterprise Co. Ltd. | 2000 |  | 15455 |
|  Orient Electric Ltd. | 6985 |  | 22682 |
|  PIK Group PJSC\* ‡ | 4646 |  |  |
|  Q Technology Group Co. Ltd.\* (a) (b) | 151000 |  | 59632 |
|  Sampo Corp. | 98000 |  | 71472 |
|  Skyworth Group Ltd. | 490000 |  | 179774 |
|  TCL Electronics Holdings Ltd.(a) | 343000 |  | 131085 |
|  TCL Technology Group Corp., Class A | 55700 |  | 29840 |
|  TTK Prestige Ltd. | 1825 |  | 20532 |
|  Vestel Beyaz Esya Sanayi ve Ticaret A/S | 111934 |  | 56440 |
|  Vestel Elektronik Sanayi ve Ticaret A/S | 52381 |  | 129806 |
|  Whirlpool of India Ltd. | 674 |  | 12828 |
|  Zinus, Inc. | 3381 |  | 74292 |
|  |  |  | **2493378** |
| **Household Products – 0.1%** | **Household Products – 0.1%** | **Household Products – 0.1%** | **Household Products – 0.1%** |
|  Blue Moon Group Holdings Ltd.(a) (b) | 26500 |  | 15630 |
|  Kimberly-Clark de Mexico SAB de CV, Class A | 61100 |  | 96226 |
|  Unilever Indonesia Tbk. PT | 75200 |  | 22371 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Household Products – (continued)** | **Household Products – (continued)** | **Household Products – (continued)** | **Household Products – (continued)** |
|  Vinda International Holdings Ltd. | 3000 | $| 5625 |
|  |  |  | **139852** |
| **Independent Power and Renewable Electricity<br>Producers – 1.7%** | **Independent Power and Renewable Electricity<br>Producers – 1.7%** | **Independent Power and Renewable Electricity<br>Producers – 1.7%** | **Independent Power and Renewable Electricity<br>Producers – 1.7%** |
|  Aboitiz Power Corp. | 34200 |  | 18679 |
|  ACEN Corp. | 208910 |  | 22531 |
|  Adani Green Energy Ltd.\* | 6027 |  | 153111 |
|  Adani Power Ltd.\* | 15897 |  | 64316 |
|  AES Brasil Energia SA | 93100 |  | 175652 |
|  Aksa Enerji Uretim A/S | 8200 |  | 18249 |
|  Auren Energia SA | 5000 |  | 14217 |
|  Banpu Power PCL, NVDR | 19300 |  | 7556 |
|  Canvest Environmental Protection Group Co. Ltd.(a) (b) | 196000 |  | 120598 |
|  CGN New Energy Holdings Co. Ltd.(a) | 488000 |  | 131172 |
|  CGN Power Co. Ltd., Class A | 44000 |  | 15915 |
|  CGN Power Co. Ltd., Class H(b) | 343000 |  | 69475 |
|  China Datang Corp. Renewable Power Co. Ltd., Class H(a) | 920000 |  | 248463 |
|  China Longyuan Power Group Corp. Ltd., Class H | 58000 |  | 66276 |
|  China National Nuclear Power Co. Ltd., Class A | 40700 |  | 33626 |
|  China Power International Development Ltd.(a) | 147000 |  | 42509 |
|  China Resources Power Holdings Co. Ltd. | 54000 |  | 78559 |
|  China Three Gorges Renewables Group Co. Ltd., Class A | 47000 |  | 35869 |
|  China Yangtze Power Co. Ltd., Class A | 34300 |  | 95213 |
|  Colbun SA | 2835278 |  | 278507 |
|  Datang International Power Generation Co. Ltd., Class H\* (a) | 128000 |  | 16306 |
|  Electricity Generating PCL, NVDR | 8900 |  | 39870 |

---

*See Accompanying Notes to the Financial Statements.* 

258 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** |
|  Energy Absolute PCL, NVDR | 30900 | $78346 |
|  Eneva SA\* | 19600 | 52966 |
|  Engie Brasil Energia SA | 6350 | 48673 |
|  First Gen Corp. | 29500 | 7921 |
|  GD Power Development Co. Ltd., Class A\* | 42500 | 25447 |
|  Global Power Synergy PCL, NVDR | 13700 | 22317 |
|  Guangxi Guiguan Electric Power Co. Ltd., Class A | 15000 | 12845 |
|  Gulf Energy Development PCL, NVDR | 84000 | 111456 |
|  Huadian Power International Corp. Ltd., Class A | 26500 | 19715 |
|  Huadian Power International Corp. Ltd., Class H | 38000 | 11424 |
|  Huaneng Lancang River Hydropower, Inc., Class A | 15000 | 13092 |
|  Huaneng Power International, Inc., Class A\* | 24300 | 22307 |
|  Huaneng Power International, Inc., Class H\* (a) | 100000 | 35797 |
|  Hub Power Co. Ltd. (The) | 449477 | 134614 |
|  Hubei Energy Group Co. Ltd., Class A | 23500 | 13459 |
|  JSW Energy Ltd. | 8692 | 35455 |
|  KG Eco Technology Service Co. Ltd. | 6851 | 45787 |
|  Malakoff Corp. Bhd. | 681600 | 88660 |
|  Mega First Corp. Bhd. | 259700 | 180164 |
|  NHPC Ltd. | 79420 | 40872 |
|  NLC India Ltd. | 95403 | 88802 |
|  NTPC Ltd. | 143442 | 299958 |
|  OGK-2 PJSC‡ | 11431280 |  |
|  Omega Energia SA | 11994 | 24572 |
|  Ratch Group PCL, NVDR | 8900 | 9587 |
|  SDIC Power Holdings Co. Ltd., Class A | 23500 | 32520 |
|  Shamal Az-Zour Al-Oula for the First Phase of Az-Zour Power Plant KSC | 26687 | 16628 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** | **Independent Power and Renewable Electricity<br>Producers – (continued)** |
|  Shanghai Electric Power Co. Ltd., Class A\* | 10000 | $| 12564 |
|  Shenzhen Energy Group Co. Ltd., Class A | 10600 |  | 8278 |
|  Sichuan Chuantou Energy Co. Ltd., Class A | 9400 |  | 14232 |
|  Super Energy Corp. PCL, NVDR | 4764500 |  | 87629 |
|  Taiwan Cogeneration Corp. | 23000 |  | 20878 |
|  Terna Energy SA | 933 |  | 17355 |
|  TPI Polene Power PCL, NVDR | 1062000 |  | 93755 |
|  Unipro PJSC‡ | 5337000 |  |  |
|  Xinyi Energy Holdings Ltd. | 1761 |  | 449 |
|  |  |  | **3475193** |
| **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** |
|  3M India Ltd.\* | 69 |  | 19412 |
|  Aamal Co. | 21949 |  | 6780 |
|  Aboitiz Equity Ventures, Inc. | 75110 |  | 73490 |
|  AG Anadolu Grubu Holding A/S | 48734 |  | 225425 |
|  Alfa SAB de CV, Class A | 78400 |  | 51940 |
|  Alliance Global Group, Inc. | 157700 |  | 24437 |
|  Alpha Dhabi Holding PJSC\* | 41111 |  | 274219 |
|  AntarChile SA | 3206 |  | 24291 |
|  Astra Industrial Group | 1827 |  | 26742 |
|  Ayala Corp. | 4190 |  | 48227 |
|  Bidvest Group Ltd. (The) | 5247 |  | 60666 |
|  China Baoan Group Co. Ltd., Class A | 5500 |  | 8711 |
|  CITIC Ltd. | 196000 |  | 175529 |
|  CJ Corp. | 564 |  | 28429 |
|  DMCI Holdings, Inc. | 121000 |  | 19815 |
|  Doosan Co. Ltd. | 574 |  | 31189 |
|  Dubai Investments PJSC | 16050 |  | 9526 |
|  Enka Insaat ve Sanayi A/S | 53350 |  | 53743 |
|  Far Eastern New Century Corp. | 121000 |  | 120728 |
|  Fosun International Ltd.(a) | 61500 |  | 37606 |
|  Godrej Industries Ltd.\* | 3377 |  | 17516 |
|  Grupo Carso SAB de CV, Series A1(a) | 11100 |  | 44648 |
|  GS Holdings Corp. | 2570 |  | 82993 |
|  GT Capital Holdings, Inc. | 1610 |  | 11469 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 259

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** |
|  Hanwha Corp. | 1692 | $| 30171 |
|  HAP Seng Consolidated Bhd. | 11900 |  | 16184 |
|  Hong Leong Industries Bhd. | 30600 |  | 60190 |
|  Hosken Consolidated Investments Ltd.\* | 1886 |  | 18473 |
|  Hyosung Corp. | 201 |  | 9666 |
|  Industries Qatar QSC | 31838 |  | 137869 |
|  International Holding Co. PJSC\* | 8183 |  | 897823 |
|  JG Summit Holdings, Inc. | 58911 |  | 43866 |
|  KAP Industrial Holdings Ltd. | 952315 |  | 239407 |
|  KOC Holding A/S | 28781 |  | 86020 |
|  LG Corp. | 3724 |  | 207056 |
|  Lotte Corp. | 1392 |  | 31857 |
|  LT Group, Inc. | 5700 |  | 794 |
|  LX Holdings Corp.\* | 3899 |  | 23759 |
|  Mannai Corp. QSC | 29204 |  | 60946 |
|  Multiply Group\* | 115346 |  | 124357 |
|  Mytilineos SA | 2685 |  | 45060 |
|  National Industries Group Holding SAK | 63551 |  | 48009 |
|  Quinenco SA | 12939 |  | 34397 |
|  Reunert Ltd. | 69188 |  | 173972 |
|  Samsung C&T Corp. | 2554 |  | 212467 |
|  San Miguel Corp. | 13510 |  | 22427 |
|  Shanghai Industrial Holdings Ltd.(a) | 152000 |  | 148324 |
|  Siemens Ltd. | 1335 |  | 47183 |
|  Sime Darby Bhd. | 76600 |  | 36453 |
|  SK, Inc. | 1162 |  | 174571 |
|  SM Investments Corp. | 7590 |  | 107400 |
|  Sunway Bhd. | 50749 |  | 17174 |
|  Turkiye Sise ve Cam Fabrikalari A/S | 48416 |  | 86459 |
|  |  |  | **4619865** |
| **Insurance – 2.4%** | **Insurance – 2.4%** | **Insurance – 2.4%** | **Insurance – 2.4%** |
|  Abu Dhabi National Insurance Co. PSC | 114074 |  | 185721 |
|  Allianz Malaysia Bhd. | 24500 |  | 69023 |
|  Bangkok Insurance PCL, NVDR | 3100 |  | 22480 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  BB Seguridade Participacoes SA | 19600 | $110901 |
|  Bupa Arabia for Cooperative Insurance Co. | 262 | 13457 |
|  Caixa Seguridade Participacoes S/A | 15000 | 25213 |
|  Capital Financial Indonesia Tbk. PT\* | 325000 | 15836 |
|  Cathay Financial Holding Co. Ltd. | 261000 | 306177 |
|  Central Reinsurance Co. Ltd. | 63000 | 34802 |
|  China Development Financial Holding Corp. | 490000 | 178679 |
|  China Life Insurance Co. Ltd., Class H | 221000 | 240712 |
|  China Pacific Insurance Group Co. Ltd., Class A | 19200 | 50061 |
|  China Pacific Insurance Group Co. Ltd., Class H | 58800 | 94831 |
|  China Taiping Insurance Holdings Co. Ltd. | 31800 | 22038 |
|  Co. for Cooperative Insurance (The)\* | 974 | 21955 |
|  DB Insurance Co. Ltd. | 1176 | 46480 |
|  Discovery Ltd.\* | 9230 | 60380 |
|  Fubon Financial Holding Co. Ltd. | 233575 | 369690 |
|  General Insurance Corp. of India(b) | 39 | 58 |
|  Hanwha General Insurance Co. Ltd.\* | 26656 | 68864 |
|  Hanwha Life Insurance Co. Ltd.\* | 12318 | 18895 |
|  HDFC Life Insurance Co. Ltd.(b) | 16290 | 106357 |
|  Hyundai Marine & Fire Insurance Co. Ltd. | 1262 | 29502 |
|  ICICI Lombard General Insurance Co. Ltd.(b) | 3611 | 51037 |
|  ICICI Prudential Life Insurance Co. Ltd.(b) | 5910 | 36237 |
|  Korean Reinsurance Co. | 32003 | 165132 |
|  Max Financial Services Ltd.\* | 2721 | 23274 |
|  Mercuries & Associates Holding Ltd. | 189465 | 83200 |

---

*See Accompanying Notes to the Financial Statements.* 

260 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Mercuries Life Insurance Co. Ltd.\* | 126094 | $21444 |
|  Meritz Fire & Marine Insurance Co. Ltd. | 1556 | 34354 |
|  Mirae Asset Life Insurance Co. Ltd. | 27274 | 50740 |
|  Momentum Metropolitan Holdings | 40751 | 38096 |
|  New China Life Insurance Co. Ltd., Class A | 4700 | 15049 |
|  New China Life Insurance Co. Ltd., Class H(a) | 28100 | 44603 |
|  Old Mutual Ltd. | 139322 | 79147 |
|  PB Fintech Ltd.\* | 3620 | 16883 |
|  People's Insurance Co. Group of China Ltd. (The), Class H | 225000 | 62199 |
|  PICC Property & Casualty Co. Ltd., Class H | 196000 | 180773 |
|  Ping An Insurance Group Co. of China Ltd., Class A | 24600 | 121844 |
|  Ping An Insurance Group Co. of China Ltd., Class H(a) | 184000 | 736014 |
|  Porto Seguro SA | 5000 | 22145 |
|  Qatar Insurance Co. SAQ | 76097 | 45135 |
|  Qualitas Controladora SAB de CV(a) | 5584 | 21901 |
|  Rand Merchant Investment Holdings Ltd.(a) | 21250 | 32978 |
|  Samsung Fire & Marine Insurance Co. Ltd. | 995 | 139703 |
|  Samsung Life Insurance Co. Ltd. | 2548 | 120562 |
|  Sanlam Ltd. | 56265 | 163613 |
|  Santam Ltd. | 723 | 10006 |
|  SBI Life Insurance Co. Ltd.(b) | 7378 | 112835 |
|  Shin Kong Financial Holding Co. Ltd. | 441000 | 109489 |
|  Shinkong Insurance Co. Ltd. | 82000 | 112099 |
|  Sul America SA\* | 5477 | 24884 |
|  Syarikat Takaful Malaysia Keluarga Bhd. | 231960 | 161901 |
|  Tongyang Life Insurance Co. Ltd. | 13123 | 47169 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  ZhongAn Online P&C Insurance Co. Ltd., Class H\* (a) (b) | 11000 | $| 20487 |
|  |  |  | **4997045** |
| **Interactive Media & Services – 2.0%** | **Interactive Media & Services – 2.0%** | **Interactive Media & Services – 2.0%** | **Interactive Media & Services – 2.0%** |
|  AfreecaTV Co. Ltd. | 275 |  | 15367 |
|  Autohome, Inc., Class A(a) | 5200 |  | 34645 |
|  Baidu, Inc., Class A\* | 39200 |  | 375029 |
|  Hello Group, Inc., ADR | 52528 |  | 246882 |
|  Info Edge India Ltd. | 1318 |  | 62442 |
|  JOYY, Inc., ADR | 825 |  | 20815 |
|  Kakao Corp. | 5519 |  | 196436 |
|  Kanzhun Ltd., ADR\* | 3479 |  | 38025 |
|  Kuaishou Technology\* (a) (b) | 34300 |  | 141135 |
|  NAVER Corp. | 2548 |  | 303195 |
|  Tencent Holdings Ltd. | 103600 |  | 2713448 |
|  Weibo Corp., Class A\* | 1640 |  | 19012 |
|  |  |  | **4166431** |
| **Internet & Direct Marketing Retail – 2.6%** | **Internet & Direct Marketing Retail – 2.6%** | **Internet & Direct Marketing Retail – 2.6%** | **Internet & Direct Marketing Retail – 2.6%** |
|  Alibaba Group Holding Ltd.\* | 269500 |  | 2109693 |
|  Alibaba Health Information Technology Ltd.\* (a) | 84000 |  | 35527 |
|  Americanas SA\* | 8118 |  | 24042 |
|  Bukalapak.com PT Tbk.\* | 700000 |  | 12387 |
|  Dada Nexus Ltd., ADR\* (a) | 2805 |  | 8667 |
|  GoTo Gojek Tokopedia Tbk. PT\* | 15596700 |  | 185990 |
|  Hyundai Home Shopping Network Corp. | 2038 |  | 64096 |
|  JD Health International, Inc.\* (a) (b) | 19600 |  | 107490 |
|  JD.com, Inc., Class A | 40451 |  | 747714 |
|  Maoyan Entertainment\* (b) | 22000 |  | 12808 |
|  Meituan, Class B\* (b) | 68600 |  | 1090630 |
|  momo.com, Inc. | 1560 |  | 23359 |
|  Naspers Ltd., Class N | 3761 |  | 388860 |
|  Pinduoduo, Inc., ADR\* | 9310 |  | 510467 |
|  Ping An Healthcare and Technology Co. Ltd.\* (a) (b) | 11000 |  | 20291 |
|  Vipshop Holdings Ltd., ADR\* | 10878 |  | 75820 |
|  Zomato Ltd.\* | 26592 |  | 20271 |
|  |  |  | **5438112** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 261

------

##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **IT Services – 1.8%** | **IT Services – 1.8%** | **IT Services – 1.8%** |
|  Al Moammar Information Systems Co. | 505 | $14219 |
|  Arabian Internet & Communications Services Co. | 597 | 39402 |
|  Chinasoft International Ltd.\* | 46000 | 30472 |
|  Chindata Group Holdings Ltd., ADR\* (a) | 5145 | 27320 |
|  Cielo SA\* | 426300 | 483393 |
|  Coforge Ltd. | 858 | 39487 |
|  Computer Age Management Services Ltd. | 1007 | 31011 |
|  Dagang NeXchange Bhd. | 134400 | 21604 |
|  Danal Co. Ltd.\* | 2860 | 11625 |
|  DHC Software Co. Ltd., Class A | 9400 | 7946 |
|  eClerx Services Ltd. | 679 | 10825 |
|  Elm Co. | 546 | 48097 |
|  Fawry for Banking & Payment Technology Services SAE\* | 36652 | 5964 |
|  Firstsource Solutions Ltd. | 6900 | 8657 |
|  GDS Holdings Ltd., Class A\* (a) | 14700 | 17790 |
|  Happiest Minds Technologies Ltd. | 1568 | 18381 |
|  HCL Technologies Ltd. | 17003 | 213859 |
|  Hyundai Autoever Corp. | 212 | 17636 |
|  Infosys Ltd. | 63406 | 1177811 |
|  Jasmine Technology Solution PCL, NVDR\* | 4100 | 5225 |
|  Kakaopay Corp.\* | 398 | 9877 |
|  Kginicis Co. Ltd. | 7674 | 69227 |
|  Larsen & Toubro Infotech Ltd.(b) | 682 | 39051 |
|  Locaweb Servicos de Internet SA\* (b) | 23949 | 49886 |
|  Lotte Data Communication Co. | 2352 | 38555 |
|  Mastek Ltd. | 660 | 13462 |
|  Mindtree Ltd. | 1083 | 44532 |
|  Mphasis Ltd. | 1715 | 40991 |
|  My EG Services Bhd. | 87557 | 16389 |
|  NIIT Ltd. | 4395 | 14811 |
|  Persistent Systems Ltd. | 884 | 39439 |
|  Posco ICT Co. Ltd. | 2080 | 8367 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  Samsung SDS Co. Ltd. | 686 | $| 60199 |
|  Sonata Software Ltd. | 2854 |  | 18047 |
|  Systex Corp. | 13000 |  | 26708 |
|  Tata Consultancy Services Ltd. | 17248 |  | 665343 |
|  Tech Mahindra Ltd. | 10486 |  | 134708 |
|  TravelSky Technology Ltd., Class H(a) | 49000 |  | 71161 |
|  Wipro Ltd. | 25521 |  | 119177 |
|  Yeahka Ltd.\* (a) | 13200 |  | 30100 |
|  |  |  | **3740754** |
| **Leisure Products – 0.2%** | **Leisure Products – 0.2%** | **Leisure Products – 0.2%** | **Leisure Products – 0.2%** |
|  Fusheng Precision Co. Ltd. | 41000 |  | 230941 |
|  Giant Manufacturing Co. Ltd. | 5000 |  | 31888 |
|  GOLFZON Co. Ltd. | 271 |  | 21936 |
|  HLB, Inc.\* | 1661 |  | 47226 |
|  Johnson Health Tech Co. Ltd. | 2000 |  | 4487 |
|  Merida Industry Co. Ltd. | 5350 |  | 29222 |
|  O-TA Precision Industry Co. Ltd. | 26000 |  | 73911 |
|  |  |  | **439611** |
| **Life Sciences Tools & Services – 0.3%** | **Life Sciences Tools & Services – 0.3%** | **Life Sciences Tools & Services – 0.3%** | **Life Sciences Tools & Services – 0.3%** |
|  Cellivery Therapeutics, Inc.\* | 376 |  | 3286 |
|  Divi's Laboratories Ltd. | 2340 |  | 102018 |
|  EirGenix, Inc.\* | 9000 |  | 28350 |
|  Genscript Biotech Corp.\* | 20000 |  | 50549 |
|  Hangzhou Tigermed Consulting Co. Ltd., Class H(b) | 5900 |  | 40098 |
|  LegoChem Biosciences, Inc.\* | 1250 |  | 29836 |
|  Pharmaron Beijing Co. Ltd., Class H(b) | 7700 |  | 25896 |
|  Samsung Biologics Co. Ltd.\* (b) | 294 |  | 181009 |
|  ST Pharm Co. Ltd. | 344 |  | 20117 |
|  Syngene International Ltd.(b) | 1400 |  | 10677 |
|  WuXi AppTec Co. Ltd., Class A | 4060 |  | 42499 |
|  WuXi AppTec Co. Ltd., Class H(b) | 6818 |  | 54632 |
|  |  |  | **588967** |
| **Machinery – 1.1%** | **Machinery – 1.1%** | **Machinery – 1.1%** | **Machinery – 1.1%** |
|  AIA Engineering Ltd. | 600 |  | 19438 |
|  Airtac International Group | 2913 |  | 66898 |
|  Ashok Leyland Ltd. | 30502 |  | 56488 |

---

*See Accompanying Notes to the Financial Statements.* 

262 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  BEML Ltd. | 800 | $15232 |
|  China CSSC Holdings Ltd., Class A | 10000 | 36336 |
|  China International Marine Containers Group Co. Ltd., Class H(a) | 23849 | 15191 |
|  CIMC Enric Holdings Ltd.(a) | 30000 | 29236 |
|  CNPC Capital Co. Ltd., Class A | 29200 | 18003 |
|  Creative & Innovative System\* | 2703 | 24763 |
|  Cummins India Ltd. | 2280 | 37126 |
|  Daewoo Shipbuilding & Marine Engineering Co. Ltd.\* | 705 | 9057 |
|  Dawonsys Co. Ltd. | 1869 | 22437 |
|  Doosan Bobcat, Inc. | 1272 | 29915 |
|  Elgi Equipments Ltd. | 8864 | 51897 |
|  Escorts Kubota Ltd. | 1049 | 25831 |
|  GMM Pfaudler Ltd. | 900 | 20066 |
|  Grindwell Norton Ltd. | 1275 | 32392 |
|  Haitian International Holdings Ltd. | 16000 | 32041 |
|  Hiwin Technologies Corp. | 5535 | 28515 |
|  HJ Shipbuilding & Construction Co. Ltd.\* | 1060 | 2608 |
|  Hyundai Construction Equipment Co. Ltd. | 4263 | 128688 |
|  Hyundai Doosan Infracore Co. Ltd.\* | 45463 | 177135 |
|  Hyundai Elevator Co. Ltd. | 208 | 3680 |
|  Hyundai Heavy Industries Co. Ltd.\* | 449 | 34358 |
|  Hyundai Mipo Dockyard Co. Ltd.\* | 400 | 25778 |
|  Hyundai Rotem Co. Ltd.\* | 1766 | 30189 |
|  Kinik Co. | 6000 | 18993 |
|  Korea Shipbuilding & Offshore Engineering Co. Ltd.\* | 605 | 30878 |
|  Lakshmi Machine Works Ltd. | 165 | 25673 |
|  LK Technology Holdings Ltd.(a) | 22000 | 19927 |
|  Lonking Holdings Ltd. | 784000 | 107864 |
|  Ningbo Deye Technology Co. Ltd., Class A | 500 | 22413 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Otokar Otomotiv ve Savunma Sanayi A/S | 2941 | $83632 |
|  Pentamaster Corp. Bhd. | 21200 | 17398 |
|  People & Technology, Inc. | 1111 | 35995 |
|  Riyue Heavy Industry Co. Ltd., Class A | 5000 | 15133 |
|  Sam Engineering & Equipment M Bhd. | 64400 | 72191 |
|  SAM KANG M&T Co. Ltd.\* | 1219 | 17329 |
|  Samsung Heavy Industries Co. Ltd.\* | 14188 | 51296 |
|  Sany Heavy Equipment International Holdings Co. Ltd. | 12000 | 9845 |
|  Sany Heavy Industry Co. Ltd., Class A | 24500 | 45317 |
|  Schaeffler India Ltd. | 882 | 29350 |
|  SFA Engineering Corp. | 704 | 18855 |
|  Shin Zu Shing Co. Ltd. | 62000 | 149889 |
|  Sinotruk Hong Kong Ltd. | 30500 | 27198 |
|  SKF India Ltd. | 624 | 33156 |
|  Thermax Ltd. | 944 | 24769 |
|  Timken India Ltd. | 605 | 21930 |
|  Turk Traktor ve Ziraat Makineleri A/S | 5439 | 111336 |
|  UWC Bhd. | 10600 | 8295 |
|  Weichai Power Co. Ltd., Class A | 17300 | 21522 |
|  Weichai Power Co. Ltd., Class H | 68000 | 65143 |
|  XCMG Construction Machinery Co. Ltd., Class A | 18800 | 11926 |
|  Yangzijiang Shipbuilding Holdings Ltd. | 93100 | 78949 |
|  Zhengzhou Coal Mining Machinery Group Co. Ltd., Class A | 9400 | 15957 |
|  Zhengzhou Coal Mining Machinery Group Co. Ltd., Class H | 10000 | 8573 |
|  Zoomlion Heavy Industry Science and Technology Co. Ltd., Class A | 17700 | 12974 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 263

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Zoomlion Heavy Industry Science and Technology Co. Ltd., Class H | 29200 | $| 9411 |
|  |  |  | **2196415** |
| **Marine – 0.6%** | **Marine – 0.6%** | **Marine – 0.6%** | **Marine – 0.6%** |
|  Cia Sud Americana de Vapores SA | 567041 |  | 39352 |
|  COSCO SHIPPING Holdings Co. Ltd., Class A | 37700 |  | 58007 |
|  COSCO SHIPPING Holdings Co. Ltd., Class H | 104450 |  | 112702 |
|  Evergreen Marine Corp. Taiwan Ltd. | 33023 |  | 140916 |
|  Far-Eastern Shipping Co. plc\* <sup>‡</sup> | 302500 |  |  |
|  HMM Co. Ltd. | 11025 |  | 147831 |
|  Korea Line Corp.\* | 72422 |  | 100159 |
|  MISC Bhd. | 22400 |  | 34254 |
|  Orient Overseas International Ltd.(a) | 3500 |  | 51141 |
|  Pan Ocean Co. Ltd. | 8853 |  | 26725 |
|  Precious Shipping PCL, NVDR | 323400 |  | 111312 |
|  Qatar Navigation QSC | 19070 |  | 53622 |
|  Regional Container Lines PCL, NVDR | 15000 |  | 10444 |
|  Shih Wei Navigation Co. Ltd. | 65000 |  | 46295 |
|  Taiwan Navigation Co. Ltd. | 90000 |  | 64939 |
|  Temas Tbk. PT | 409400 |  | 47115 |
|  Transcoal Pacific Tbk. PT | 32900 |  | 21673 |
|  U-Ming Marine Transport Corp. | 14000 |  | 15294 |
|  Wan Hai Lines Ltd. | 45885 |  | 96405 |
|  Wisdom Marine Lines Co. Ltd. | 11898 |  | 19311 |
|  Yang Ming Marine Transport Corp. | 52000 |  | 97149 |
|  |  |  | **1294646** |
| **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** |
|  Affle India Ltd.\* | 1050 |  | 14644 |
|  Astro Malaysia Holdings Bhd. | 139200 |  | 19873 |
|  Cheil Worldwide, Inc. | 1074 |  | 18435 |
|  China Literature Ltd.\* (b) | 6200 |  | 16705 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Echo Marketing, Inc. | 863 | $| 8512 |
|  Elang Mahkota Teknologi Tbk. PT | 686000 |  | 67951 |
|  Focus Media Information Technology Co. Ltd., Class A | 23500 |  | 14425 |
|  Grupo Televisa SAB, Series CPO(a) | 38900 |  | 41195 |
|  Innocean Worldwide, Inc. | 3399 |  | 95805 |
|  Media Nusantara Citra Tbk. PT\* | 2781600 |  | 146236 |
|  Mobvista, Inc.\* (a) (b) | 20000 |  | 10293 |
|  MultiChoice Group | 9555 |  | 62407 |
|  Plan B Media PCL, NVDR\* | 97500 |  | 18060 |
|  Saudi Research & Media Group\* | 605 |  | 32427 |
|  Sun TV Network Ltd. | 1889 |  | 11932 |
|  Surya Citra Media Tbk. PT | 427000 |  | 6406 |
|  Zee Entertainment Enterprises Ltd. | 17444 |  | 55307 |
|  |  |  | **640613** |
| **Metals & Mining – 4.7%** | **Metals & Mining – 4.7%** | **Metals & Mining – 4.7%** | **Metals & Mining – 4.7%** |
|  Adaro Minerals Indonesia Tbk. PT\* | 120400 |  | 13354 |
|  African Rainbow Minerals Ltd. | 3822 |  | 53794 |
|  Alrosa PJSC\* <sup>‡</sup> | 85800 |  |  |
|  Aluminum Corp. of China Ltd., Class A | 26500 |  | 14015 |
|  Aluminum Corp. of China Ltd., Class H | 124000 |  | 35384 |
|  Aneka Tambang Tbk. | 201400 |  | 23823 |
|  Angang Steel Co. Ltd., Class H | 38000 |  | 7891 |
|  Anglo American Platinum Ltd. | 1470 |  | 116874 |
|  AngloGold Ashanti Ltd. | 12544 |  | 164685 |
|  APL Apollo Tubes Ltd. | 3361 |  | 43808 |
|  ArcelorMittal South Africa Ltd.\* | 108486 |  | 27804 |
|  Baoshan Iron & Steel Co. Ltd., Class A | 58800 |  | 38751 |
|  Beijing Shougang Co. Ltd., Class A | 10600 |  | 4967 |
|  Bradespar SA (Preference) | 6186 |  | 28305 |
|  Bumi Resources Minerals Tbk. PT\* | 1235000 |  | 14331 |
|  CAP SA | 2756 |  | 14743 |

---

*See Accompanying Notes to the Financial Statements.* 

264 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Century Iron & Steel Industrial Co. Ltd. | 6000 | $14338 |
|  Chifeng Jilong Gold Mining Co. Ltd., Class A\* | 5000 | 12893 |
|  China Gold International Resources Corp. Ltd.(a) | 96200 | 223777 |
|  China Hongqiao Group Ltd.(a) | 49000 | 34769 |
|  China Metal Products | 103000 | 85667 |
|  China Metal Recycling Holdings Ltd.\* <sup>‡</sup> | 51000 |  |
|  China Nonferrous Mining Corp. Ltd.(a) | 441000 | 160111 |
|  China Northern Rare Earth Group High-Tech Co. Ltd., Class A | 5300 | 17573 |
|  China Oriental Group Co. Ltd. | 490000 | 68040 |
|  China Steel Corp. | 343000 | 285811 |
|  China Zhongwang Holdings Ltd.\* <sup>‡</sup> | 699600 | 129635 |
|  Chun Yuan Steel Industry Co. Ltd. | 196000 | 90328 |
|  Chung Hung Steel Corp. | 23000 | 14062 |
|  Cia Brasileira de Aluminio | 11000 | 23144 |
|  Cia Siderurgica Nacional SA | 19600 | 45869 |
|  Citic Pacific Special Steel Group Co. Ltd., Class A | 10600 | 23383 |
|  CMOC Group Ltd., Class A | 22500 | 12794 |
|  CMOC Group Ltd., Class H(a) | 57000 | 18371 |
|  Dongkuk Steel Mill Co. Ltd. | 2067 | 16615 |
|  DRDGOLD Ltd.(a) | 186586 | 96352 |
|  Eregli Demir ve Celik Fabrikalari TAS | 40376 | 64461 |
|  Ezz Steel Co. SAE | 64485 | 44432 |
|  Feng Hsin Steel Co. Ltd. | 11000 | 19219 |
|  Ganfeng Lithium Group Co. Ltd., Class A | 3080 | 33346 |
|  Ganfeng Lithium Group Co. Ltd., Class H(a) (b) | 7280 | 49245 |
|  GEM Co. Ltd., Class A | 5300 | 5403 |
|  Gerdau SA (Preference) | 32100 | 157525 |
|  Gold Fields Ltd. | 15014 | 121313 |
|  Grupo Mexico SAB de CV, Series B | 91113 | 329722 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Harmony Gold Mining Co. Ltd. | 16953 | $46945 |
|  Henan Shenhuo Coal & Power Co. Ltd., Class A | 5500 | 10573 |
|  Hesteel Co. Ltd., Class A | 37600 | 11179 |
|  Hindalco Industries Ltd. | 45766 | 224276 |
|  Hindustan Copper Ltd. | 16483 | 20510 |
|  Hsin Kuang Steel Co. Ltd. | 98000 | 104014 |
|  Hunan Valin Steel Co. Ltd., Class A | 23500 | 12879 |
|  Hyundai Steel Co. | 2109 | 41604 |
|  Impala Platinum Holdings Ltd. | 24775 | 253581 |
|  Industrias CH SAB de CV, Series B\* | 1147 | 12638 |
|  Industrias Penoles SAB de CV(a) | 4912 | 55621 |
|  Inner Mongolia BaoTou Steel Union Co. Ltd., Class A | 70500 | 17001 |
|  Inner Mongolia ERDOS Resources Co. Ltd., Class A | 4480 | 8544 |
|  Inner Mongolia ERDOS Resources Co. Ltd., Class B | 7420 | 12940 |
|  Jiangxi Copper Co. Ltd., Class A | 9400 | 19834 |
|  Jiangxi Copper Co. Ltd., Class H | 31000 | 33883 |
|  Jinchuan Group International Resources Co. Ltd. | 144000 | 9539 |
|  Jindal Stainless Hisar Ltd.\* | 40929 | 140917 |
|  Jindal Stainless Ltd.\* | 66199 | 113201 |
|  Jindal Steel & Power Ltd. | 12907 | 71702 |
|  JSW Steel Ltd. | 28469 | 231786 |
|  Kardemir Karabuk Demir Celik Sanayi ve Ticaret A/S, Class D | 25050 | 16118 |
|  KG DONGBUSTEEL | 1060 | 5782 |
|  KISWIRE Ltd. | 3524 | 44407 |
|  Korea Zinc Co. Ltd. | 392 | 176124 |
|  Koza Altin Isletmeleri A/S | 2182 | 22790 |
|  Koza Anadolu Metal Madencilik Isletmeleri A/S\* | 74333 | 127385 |
|  Kumba Iron Ore Ltd. | 1960 | 36901 |
|  Maanshan Iron & Steel Co. Ltd., Class A | 21200 | 7320 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 265

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Maanshan Iron & Steel Co. Ltd., Class H(a) | 22000 | $3531 |
|  Magnitogorsk Iron & Steel Works PJSC<sup>‡</sup> | 45174 |  |
|  Merdeka Copper Gold Tbk. PT\* | 230462 | 55704 |
|  Metalurgica Gerdau SA (Preference) | 21400 | 45881 |
|  Minsur SA | 122485 | 106931 |
|  MMC Norilsk Nickel PJSC<sup>‡</sup> | 2090 |  |
|  MMG Ltd.\* (a) | 116000 | 22905 |
|  National Aluminium Co. Ltd. | 23045 | 19543 |
|  Nickel Asia Corp. | 269200 | 22437 |
|  NMDC Ltd. | 32389 | 39030 |
|  NMDC Ltd.\* | 32389 | 15064 |
|  Northam Platinum Holdings Ltd.\* | 7270 | 68192 |
|  Novolipetsk Steel PJSC<sup>‡</sup> | 51150 |  |
|  PMB Technology Bhd. | 20000 | 17090 |
|  Polyus PJSC\* <sup>‡</sup> | 1155 |  |
|  Poongsan Corp. | 7131 | 130660 |
|  POSCO Holdings, Inc. | 2303 | 402574 |
|  Press Metal Aluminium Holdings Bhd. | 58800 | 54099 |
|  Qatar Aluminum Manufacturing Co. | 42858 | 19100 |
|  Raspadskaya OJSC<sup>‡</sup> | 4240 |  |
|  Ratnamani Metals & Tubes Ltd. | 1291 | 32150 |
|  Royal Bafokeng Platinum Ltd. | 1450 | 11651 |
|  Sansteel Minguang Co. Ltd. Fujian, Class A | 14100 | 8133 |
|  Saudi Arabian Mining Co.\* | 13364 | 297685 |
|  Seah Besteel Holdings Corp. | 5782 | 67990 |
|  SeAH Steel Holdings Corp. | 691 | 65731 |
|  Severstal PAO<sup>‡</sup> | 5995 |  |
|  Shandong Gold Mining Co. Ltd., Class A | 5100 | 12089 |
|  Shandong Gold Mining Co. Ltd., Class H(a) (b) | 13650 | 21736 |
|  Shandong Nanshan Aluminum Co. Ltd., Class A | 42400 | 17893 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Shanxi Taigang Stainless Steel Co. Ltd., Class A | 15900 | $8649 |
|  Shougang Fushan Resources Group Ltd. | 1372000 | 372282 |
|  Sibanye Stillwater Ltd. | 79331 | 186181 |
|  Steel Authority of India Ltd. | 46172 | 43898 |
|  TA Chen Stainless Pipe | 49000 | 57406 |
|  Tata Steel Ltd. | 240100 | 294551 |
|  Tharisa plc(a) | 36260 | 40764 |
|  Tiangong International Co. Ltd.(a) | 546000 | 151631 |
|  Tianshan Aluminum Group Co. Ltd., Class A | 10600 | 9063 |
|  Tung Ho Steel Enterprise Corp. | 17050 | 26139 |
|  United Co. RUSAL International PJSC<sup>‡</sup> | 75100 |  |
|  Usinas Siderurgicas de Minas Gerais SA Usiminas (Preference), Class A | 185086 | 255023 |
|  Vale Indonesia Tbk. PT\* | 58300 | 24296 |
|  Vale SA | 112700 | 1441813 |
|  Vedanta Ltd. | 29204 | 99067 |
|  Volcan Cia Minera SAA, Class B\* | 122924 | 15388 |
|  VSMPO-AVISMA Corp. PJSC<sup>‡</sup> | 53 |  |
|  Western Superconducting Technologies Co. Ltd., Class A | 1500 | 23976 |
|  Xiamen Tungsten Co. Ltd., Class A | 3900 | 10730 |
|  YC INOX Co. Ltd. | 147000 | 115647 |
|  Yieh Phui Enterprise Co. Ltd. | 52500 | 23299 |
|  Young Poong Corp. | 312 | 137990 |
|  Yunnan Aluminium Co. Ltd., Class A | 6300 | 7915 |
|  Yunnan Copper Co. Ltd., Class A | 9400 | 14167 |
|  Zhaojin Mining Industry Co. Ltd., Class H\* | 31000 | 25590 |
|  Zhejiang Huayou Cobalt Co. Ltd., Class A | 4840 | 36128 |
|  Zijin Mining Group Co. Ltd., Class A | 32900 | 35701 |

---

*See Accompanying Notes to the Financial Statements.* 

266 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Zijin Mining Group Co. Ltd., Class H | 98000 | $| 93632 |
|  |  |  | **9799446** |
| **Multiline Retail – 0.2%** | **Multiline Retail – 0.2%** | **Multiline Retail – 0.2%** | **Multiline Retail – 0.2%** |
|  Aeon Co. M Bhd. | 57700 |  | 16841 |
|  Central Retail Corp. PCL, NVDR | 53475 |  | 59011 |
|  El Puerto de Liverpool SAB de CV, Class C1 | 6185 |  | 31646 |
|  Falabella SA | 22688 |  | 44347 |
|  Golden Eagle Retail Group Ltd.\* | 147000 |  | 88951 |
|  Hyundai Department Store Co. Ltd. | 224 |  | 8507 |
|  Lotte Shopping Co. Ltd. | 448 |  | 27488 |
|  Magazine Luiza SA\* | 61200 |  | 52135 |
|  MINISO Group Holding Ltd., ADR(a) | 4450 |  | 22695 |
|  Mitra Adiperkasa Tbk. PT\* | 488600 |  | 37747 |
|  Shinsegae, Inc. | 212 |  | 31626 |
|  V-Mart Retail Ltd. | 484 |  | 17601 |
|  Woolworths Holdings Ltd. | 17787 |  | 61063 |
|  |  |  | **499658** |
| **Multi-Utilities – 0.0%(d)** | **Multi-Utilities – 0.0%(d)** | **Multi-Utilities – 0.0%(d)** | **Multi-Utilities – 0.0%(d)** |
|  Qatar Electricity & Water Co. QSC | 9126 |  | 46360 |
|  YTL Power International Bhd. | 1531 |  | 228 |
|  |  |  | **46588** |
| **Oil, Gas & Consumable Fuels – 5.3%** | **Oil, Gas & Consumable Fuels – 5.3%** | **Oil, Gas & Consumable Fuels – 5.3%** | **Oil, Gas & Consumable Fuels – 5.3%** |
|  3R Petroleum Oleo E Gas SA\* | 68600 |  | 607918 |
|  Adaro Energy Indonesia Tbk. PT | 382100 |  | 97500 |
|  Aegis Logistics Ltd. | 7388 |  | 27748 |
|  AKR Corporindo Tbk. PT | 140000 |  | 14002 |
|  Aldrees Petroleum and Transport Services Co. | 1760 |  | 34005 |
|  Bangchak Corp. PCL, NVDR | 27400 |  | 21958 |
|  Banpu PCL, NVDR | 93200 |  | 30610 |
|  Bashneft PJSC<sup>‡</sup> | 1305 |  |  |
|  Bashneft PJSC (Preference)<sup>‡</sup> | 1163 |  |  |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Bayan Resources Tbk. PT | 22600 | $106498 |
|  Bharat Petroleum Corp. Ltd. | 28410 | 104216 |
|  Bukit Asam Tbk. PT | 106000 | 26572 |
|  China Coal Energy Co. Ltd., Class A | 16100 | 19456 |
|  China Coal Energy Co. Ltd., Class H | 49000 | 36080 |
|  China Petroleum & Chemical Corp., Class A | 104900 | 58497 |
|  China Petroleum & Chemical Corp., Class H | 752000 | 296974 |
|  China Shenhua Energy Co. Ltd., Class A | 19600 | 75273 |
|  China Shenhua Energy Co. Ltd., Class H | 98000 | 257801 |
|  China Suntien Green Energy Corp. Ltd., Class H(a) | 50000 | 18981 |
|  Coal India Ltd. | 65072 | 193343 |
|  Cosan SA | 35464 | 113950 |
|  COSCO SHIPPING Energy Transportation Co. Ltd., Class A\* | 8600 | 19925 |
|  Dana Gas PJSC | 1351824 | 345956 |
|  Ecopetrol SA | 146461 | 73483 |
|  Empresas Copec SA | 10437 | 71901 |
|  Enauta Participacoes SA | 30201 | 87715 |
|  Esso Thailand PCL, NVDR | 431100 | 164239 |
|  Exxaro Resources Ltd. | 6125 | 68164 |
|  Formosa Petrochemical Corp. | 29000 | 74699 |
|  Gazprom PJSC<sup>‡</sup> | 412500 |  |
|  Guanghui Energy Co. Ltd., Class A | 15100 | 21268 |
|  HD Hyundai Co. Ltd. | 1505 | 64344 |
|  Helleniq Energy Holdings SA | 3199 | 21848 |
|  Hibiscus Petroleum Bhd. | 685600 | 140658 |
|  Hindustan Petroleum Corp. Ltd. | 14504 | 37470 |
|  Indian Oil Corp. Ltd. | 107751 | 88841 |
|  Indika Energy Tbk. PT | 641200 | 134016 |
|  Indo Tambangraya Megah Tbk. PT | 16200 | 46790 |
|  Inner Mongolia Dian Tou Energy Corp. Ltd., Class A | 5300 | 8968 |
|  Inner Mongolia Yitai Coal Co. Ltd., Class B | 413600 | 584830 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 267

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Inner Mongolia Yitai Coal Co. Ltd., Class H | 64800 | $77184 |
|  IRPC PCL, NVDR | 242000 | 19965 |
|  LUKOIL PJSC<sup>‡</sup> | 12265 |  |
|  Mangalore Refinery & Petrochemicals Ltd.\* | 75900 | 49559 |
|  Mari Petroleum Co. Ltd. | 1984 | 15150 |
|  Medco Energi Internasional Tbk. PT | 2717040 | 201198 |
|  MOL Hungarian Oil & Gas plc | 13034 | 78033 |
|  Motor Oil Hellas Corinth Refineries SA | 2658 | 45658 |
|  Novatek PJSC<sup>‡</sup> | 20020 |  |
|  Oil & Natural Gas Corp. Ltd. | 112504 | 182189 |
|  Oil India Ltd. | 12376 | 28855 |
|  Pakistan Oilfields Ltd. | 55027 | 96373 |
|  Pakistan Petroleum Ltd. | 29830 | 6977 |
|  Pakistan State Oil Co. Ltd. | 124664 | 79344 |
|  Petro Rio SA\* | 12693 | 85608 |
|  PetroChina Co. Ltd., Class H | 654000 | 249941 |
|  Petroleo Brasileiro SA | 112700 | 714356 |
|  Petroleo Brasileiro SA (Preference) | 137200 | 779443 |
|  Petronas Dagangan Bhd. | 6600 | 30264 |
|  Petronet LNG Ltd. | 25624 | 63629 |
|  Petroreconcavo SA | 44100 | 263562 |
|  PTT Exploration & Production PCL | 469 | 2224 |
|  PTT Exploration & Production PCL, NVDR | 45931 | 219035 |
|  PTT PCL, NVDR | 260900 | 246779 |
|  Qatar Fuel QSC | 8595 | 45031 |
|  Qatar Gas Transport Co. Ltd. | 54208 | 61029 |
|  Rabigh Refining & Petrochemical Co.\* | 5254 | 19072 |
|  Reliance Industries Ltd. | 58751 | 1809568 |
|  Rosneft Oil Co. PJSC<sup>‡</sup> | 74042 |  |
|  Saudi Arabian Oil Co.(b) | 36317 | 337311 |
|  Semirara Mining & Power Corp. | 42200 | 25451 |
|  Shaanxi Coal Industry Co. Ltd., Class A | 24500 | 66666 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Shan Xi Hua Yang Group New Energy Co. Ltd., Class A | 10000 | $| 23141 |
|  Shanxi Coking Coal Energy Group Co. Ltd., Class A | 16900 |  | 26374 |
|  Shanxi Lu'an Environmental Energy Development Co. Ltd., Class A | 11100 |  | 25535 |
|  Siamgas & Petrochemicals PCL, NVDR | 226500 |  | 61892 |
|  SK Discovery Co. Ltd. | 261 |  | 5442 |
|  SK Gas Ltd. | 1164 |  | 93156 |
|  SK Innovation Co. Ltd.\* | 907 |  | 110156 |
|  S-Oil Corp. | 1362 |  | 82612 |
|  Star Petroleum Refining PCL, NVDR | 33500 |  | 10474 |
|  Surgutneftegas PJSC<sup>‡</sup> | 319000 |  |  |
|  Surgutneftegas PJSC (Preference)<sup>‡</sup> | 225500 |  |  |
|  Tatneft PJSC<sup>‡</sup> | 26900 |  |  |
|  Tatneft PJSC (Preference)<sup>‡</sup> | 3870 |  |  |
|  Thai Oil PCL, NVDR | 17902 |  | 25635 |
|  Thungela Resources Ltd. | 4116 |  | 64640 |
|  Transneft PJSC (Preference)<sup>‡</sup> | 55 |  |  |
|  Turkiye Petrol Rafinerileri A/S\* | 2915 |  | 59386 |
|  Ultrapar Participacoes SA | 21538 |  | 55043 |
|  United Tractors Tbk. PT | 39200 |  | 81177 |
|  Yankuang Energy Group Co. Ltd., Class A | 5300 |  | 29482 |
|  Yankuang Energy Group Co. Ltd., Class H | 46000 |  | 129506 |
|  |  |  | **10979602** |
| **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** |
|  Century Plyboards India Ltd. | 3256 |  | 23526 |
|  Century Textiles & Industries Ltd. | 2118 |  | 21907 |
|  Empresas CMPC SA | 25344 |  | 40199 |
|  Indah Kiat Pulp & Paper Tbk. PT | 85800 |  | 52808 |
|  Lee & Man Paper Manufacturing Ltd. | 862000 |  | 261350 |
|  Longchen Paper & Packaging Co. Ltd. | 298000 |  | 137336 |
|  Nine Dragons Paper Holdings Ltd. | 53000 |  | 31396 |

---

*See Accompanying Notes to the Financial Statements.* 

268 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** | **Paper & Forest Products – (continued)** |
|  Pabrik Kertas Tjiwi Kimia Tbk. PT | 53800 | $| 26904 |
|  Sappi Ltd.\* | 15650 |  | 48251 |
|  Shandong Chenming Paper Holdings Ltd., Class H\* (a) | 154000 |  | 43552 |
|  Shandong Sun Paper Industry JSC Ltd., Class A | 9400 |  | 13510 |
|  Suzano SA | 24500 |  | 248397 |
|  Ta Ann Holdings Bhd. | 93900 |  | 78449 |
|  YFY, Inc. | 47000 |  | 37267 |
|  |  |  | **1064852** |
| **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** |
|  Amorepacific Corp. | 541 |  | 35207 |
|  AMOREPACIFIC Group | 611 |  | 10595 |
|  Colgate-Palmolive India Ltd. | 2295 |  | 45240 |
|  Cosmax, Inc. | 107 |  | 3440 |
|  Dabur India Ltd. | 10829 |  | 72566 |
|  Emami Ltd. | 4717 |  | 27013 |
|  Gillette India Ltd. | 103 |  | 6399 |
|  Godrej Consumer Products Ltd.\* | 7252 |  | 72654 |
|  Grape King Bio Ltd. | 7000 |  | 26395 |
|  Hengan International Group Co. Ltd. | 18000 |  | 69823 |
|  Hindustan Unilever Ltd. | 15239 |  | 469573 |
|  Hyundai Bioscience Co. Ltd.\* | 1568 |  | 23557 |
|  Kolmar Korea Co. Ltd. | 142 |  | 3414 |
|  LG H&H Co. Ltd. | 147 |  | 52631 |
|  LG H&H Co. Ltd. (Preference) | 43 |  | 8467 |
|  Microbio Co. Ltd. | 16461 |  | 27688 |
|  Natura & Co. Holding SA | 10958 |  | 31221 |
|  Procter & Gamble Hygiene & Health Care Ltd. | 200 |  | 34036 |
|  TCI Co. Ltd. | 1000 |  | 3336 |
|  |  |  | **1023255** |
| **Pharmaceuticals – 1.4%** | **Pharmaceuticals – 1.4%** | **Pharmaceuticals – 1.4%** | **Pharmaceuticals – 1.4%** |
|  Aarti Pharmalabs Ltd.\* | 1096 |  | 5020 |
|  Adcock Ingram Holdings Ltd. | 2912 |  | 7557 |
|  Ajanta Pharma Ltd. | 576 |  | 9011 |
|  Alembic Pharmaceuticals Ltd. | 3400 |  | 22595 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Alkem Laboratories Ltd. | 516 | $19668 |
|  Apeloa Pharmaceutical Co. Ltd., Class A | 4700 | 13407 |
|  Aspen Pharmacare Holdings Ltd. | 6909 | 56866 |
|  AstraZeneca Pharma India Ltd. | 235 | 9367 |
|  Asymchem Laboratories Tianjin Co. Ltd., Class A | 700 | 13733 |
|  Aurobindo Pharma Ltd. | 5645 | 36699 |
|  Beijing Tong Ren Tang Chinese Medicine Co. Ltd.(a) | 5000 | 5586 |
|  Binex Co. Ltd.\* | 1942 | 15201 |
|  Bukwang Pharmaceutical Co. Ltd. | 1431 | 7585 |
|  CanSino Biologics, Inc., Class A | 318 | 8263 |
|  CanSino Biologics, Inc., Class H(a) (b) | 800 | 7440 |
|  Celltrion Pharm, Inc.\* | 130 | 6188 |
|  Center Laboratories, Inc. | 10414 | 14075 |
|  Changchun High & New Technology Industry Group, Inc., Class A | 600 | 13309 |
|  China Medical System Holdings Ltd. | 43000 | 46945 |
|  China Resources Pharmaceutical Group Ltd.(a) (b) | 50000 | 33759 |
|  China Traditional Chinese Medicine Holdings Co. Ltd.(a) | 88000 | 38003 |
|  Chong Kun Dang Pharmaceutical Corp. | 102 | 6015 |
|  Cipla Ltd. | 8967 | 126460 |
|  CSPC Pharmaceutical Group Ltd. | 146080 | 150177 |
|  Daewoong Co. Ltd. | 339 | 4914 |
|  Daewoong Pharmaceutical Co. Ltd. | 49 | 5555 |
|  Dong-A Socio Holdings Co. Ltd. | 1686 | 120729 |
|  Dong-A ST Co. Ltd. | 94 | 3596 |
|  DongKook Pharmaceutical Co. Ltd. | 950 | 10471 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 269

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Dr Reddy's Laboratories Ltd. | 2141 | $114675 |
|  Foresee Pharmaceuticals Co. Ltd.\* | 5000 | 11405 |
|  Genomma Lab Internacional SAB de CV, Class B | 31531 | 24257 |
|  Gland Pharma Ltd.\* (b) | 971 | 20931 |
|  GlaxoSmithKline Pharmaceuticals Ltd. | 1140 | 18969 |
|  Glenmark Pharmaceuticals Ltd. | 8121 | 39689 |
|  Grand Pharmaceutical Group Ltd.(a) | 465500 | 199250 |
|  Granules India Ltd. | 5750 | 25885 |
|  Guangzhou Baiyunshan Pharmaceutical Holdings Co. Ltd., Class A | 5000 | 18490 |
|  Guangzhou Baiyunshan Pharmaceutical Holdings Co. Ltd., Class H(a) | 12000 | 26752 |
|  Hanall Biopharma Co. Ltd.\* | 919 | 9161 |
|  Hanmi Pharm Co. Ltd. | 99 | 17584 |
|  Hanmi Science Co. Ltd. | 658 | 14805 |
|  Hansoh Pharmaceutical Group Co. Ltd.(b) | 16000 | 24704 |
|  HK inno N Corp. | 644 | 16434 |
|  Hua Han Health Industry Holdings Ltd.\* <sup>‡</sup> | 3780000 |  |
|  Hypera SA\* | 7300 | 70687 |
|  Ilyang Pharmaceutical Co. Ltd. | 795 | 9934 |
|  Ipca Laboratories Ltd. | 3080 | 33677 |
|  JB Chemicals & Pharmaceuticals Ltd. | 1609 | 38360 |
|  Jiangsu Hengrui Medicine Co. Ltd., Class A | 8400 | 46266 |
|  Joincare Pharmaceutical Group Industry Co. Ltd., Class A | 4700 | 7528 |
|  Jubilant Pharmova Ltd. | 4141 | 18362 |
|  JW Pharmaceutical Corp. | 243 | 3199 |
|  Kalbe Farma Tbk. PT | 365800 | 48078 |
|  Komipharm International Co. Ltd.\* | 1425 | 7183 |
|  Korea United Pharm, Inc. | 636 | 10626 |
|  Laurus Labs Ltd.(b) | 8132 | 44655 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Livzon Pharmaceutical Group, Inc., Class H | 3930 | $10288 |
|  Lotus Pharmaceutical Co. Ltd.\* | 2000 | 9590 |
|  Lupin Ltd. | 4620 | 39013 |
|  Luye Pharma Group Ltd.\* (b) | 29000 | 7056 |
|  Mega Lifesciences PCL, NVDR | 16800 | 19532 |
|  Mezzion Pharma Co. Ltd.\* | 636 | 5849 |
|  Natco Pharma Ltd. | 4680 | 33965 |
|  Oneness Biotech Co. Ltd.\* | 3000 | 21227 |
|  Oscotec, Inc.\* | 1510 | 19293 |
|  Pfizer Ltd. | 341 | 18035 |
|  Pharmally International Holding Co. Ltd.\* <sup>‡</sup> | 2564 | 3378 |
|  Procter & Gamble Health Ltd. | 400 | 19488 |
|  Reyon Pharmaceutical Co. Ltd. | 1045 | 14085 |
|  Richter Gedeon Nyrt. | 2074 | 40889 |
|  Sam Chun Dang Pharm Co. Ltd.\* | 890 | 19088 |
|  Sanofi India Ltd. | 163 | 11052 |
|  Shandong Buchang Pharmaceuticals Co. Ltd., Class A | 4700 | 12351 |
|  Shanghai Fosun Pharmaceutical Group Co. Ltd., Class A | 3800 | 17197 |
|  Shanghai Fosun Pharmaceutical Group Co. Ltd., Class H(a) | 8000 | 20199 |
|  Shin Poong Pharmaceutical Co. Ltd.\* | 432 | 6566 |
|  Sihuan Pharmaceutical Holdings Group Ltd. | 125000 | 10669 |
|  Sino Biopharmaceutical Ltd. | 175999 | 85423 |
|  SK Biopharmaceuticals Co. Ltd.\* | 330 | 13460 |
|  SSY Group Ltd. | 44000 | 18217 |
|  Sun Pharmaceutical Industries Ltd. | 18057 | 221825 |
|  Suven Pharmaceuticals Ltd. | 3735 | 17974 |
|  Torrent Pharmaceuticals Ltd. | 1434 | 28584 |
|  TTY Biopharm Co. Ltd. | 11000 | 25569 |
|  United Laboratories International Holdings Ltd. (The)(a) | 392000 | 164294 |

---

*See Accompanying Notes to the Financial Statements.* 

270 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Yuhan Corp. | 1025 | $| 43031 |
|  Yungjin Pharmaceutical Co. Ltd.\* | 1602 |  | 3059 |
|  Yunnan Baiyao Group Co. Ltd., Class A | 1540 |  | 11512 |
|  Zhangzhou Pientzehuang Pharmaceutical Co. Ltd., Class A | 700 |  | 21867 |
|  Zhejiang Huahai Pharmaceutical Co. Ltd., Class A | 4700 |  | 12918 |
|  Zhejiang NHU Co. Ltd., Class A | 6768 |  | 16617 |
|  Zydus Lifesciences Ltd. | 4844 |  | 25359 |
|  |  |  | **2808259** |
| **Professional Services – 0.1%** | **Professional Services – 0.1%** | **Professional Services – 0.1%** | **Professional Services – 0.1%** |
|  Boa Vista Servicos SA | 12500 |  | 15008 |
|  CTOS Digital Bhd. | 84900 |  | 25319 |
|  L&T Technology Services Ltd.(b) | 689 |  | 29456 |
|  NICE Information Service Co. Ltd. | 2317 |  | 21146 |
|  Quess Corp. Ltd.(b) | 3339 |  | 22298 |
|  Sporton International, Inc. | 5000 |  | 31345 |
|  TeamLease Services Ltd.\* | 400 |  | 14068 |
|  |  |  | **158640** |
| **Real Estate Management & Development – 3.2%** | **Real Estate Management & Development – 3.2%** | **Real Estate Management & Development – 3.2%** | **Real Estate Management & Development – 3.2%** |
|  Agile Group Holdings Ltd.\* (a) | 588000 |  | 111610 |
|  Aldar Properties PJSC | 67345 |  | 79207 |
|  Aliansce Sonae Shopping Centers sa | 5300 |  | 21948 |
|  A-Living Smart City Services Co. Ltd.(a) (b) | 13250 |  | 7511 |
|  AP Thailand PCL, NVDR | 84000 |  | 21629 |
|  Arabian Centres Co. Ltd. | 676 |  | 3508 |
|  Arriyadh Development Co. | 2145 |  | 11588 |
|  Ayala Land, Inc. | 83300 |  | 36655 |
|  Barwa Real Estate Co. | 65237 |  | 60906 |
|  BR Malls Participacoes SA | 30900 |  | 59771 |
|  Brigade Enterprises Ltd. | 4730 |  | 28545 |
|  C&D International Investment Group Ltd.(a) | 16587 |  | 25779 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Cencosud Shopping SA | 193942 | $212022 |
|  Central Pattana PCL, NVDR | 26500 | 47868 |
|  China Aoyuan Group Ltd.\* <sup>‡</sup> (a) | 713000 | 58949 |
|  China Dili Group\* (a) | 100000 | 8408 |
|  China Evergrande Group\* (a) | 66000 | 5161 |
|  China Jinmao Holdings Group Ltd. | 196000 | 25967 |
|  China Merchants Shekou Industrial Zone Holdings Co. Ltd., Class A | 18800 | 33769 |
|  China Overseas Grand Oceans Group Ltd.(a) | 490000 | 138576 |
|  China Overseas Land & Investment Ltd. | 111000 | 211823 |
|  China Overseas Property Holdings Ltd. | 30000 | 18879 |
|  China Resources Land Ltd. | 88000 | 275776 |
|  China Resources Mixc Lifestyle Services Ltd.(b) | 10000 | 29300 |
|  China Vanke Co. Ltd., Class A | 19600 | 36307 |
|  China Vanke Co. Ltd., Class H | 52100 | 66902 |
|  Chong Hong Construction Co. Ltd. | 85000 | 187555 |
|  CIFI Ever Sunshine Services Group Ltd.(b) | 10000 | 2204 |
|  CIFI Holdings Group Co. Ltd.(a) | 145553 | 9642 |
|  Ciputra Development Tbk. PT | 179449 | 10815 |
|  Commercial Real Estate Co. KSC | 591035 | 189856 |
|  Corp. Inmobiliaria Vesta SAB de CV(a) | 23200 | 50330 |
|  Country Garden Holdings Co. Ltd.(a) | 214813 | 27639 |
|  Country Garden Services Holdings Co. Ltd. | 30887 | 26992 |
|  Da-Li Development Co. Ltd. | 113000 | 92406 |
|  Dar Al Arkan Real Estate Development Co.\* | 11948 | 42672 |
|  DLF Ltd. | 11270 | 52485 |
|  Dongwon Development Co. Ltd. | 16415 | 41025 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 271

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Eco World Development Group Bhd. | 66000 | $8445 |
|  Emaar Development PJSC\* | 15780 | 18388 |
|  Emaar Economic City\* | 9847 | 25131 |
|  Emaar Properties PJSC | 115724 | 190928 |
|  Evergrande Property Services Group Ltd.\* <sup>‡</sup> (b) | 78500 |  |
|  Gemdale Corp., Class A | 14100 | 15107 |
|  Gemdale Properties & Investment Corp. Ltd.(a) | 2156000 | 118102 |
|  Godrej Properties Ltd.\* | 2621 | 39991 |
|  Greentown China Holdings Ltd. | 25000 | 23790 |
|  Greentown Service Group Co. Ltd.(a) (b) | 30000 | 12306 |
|  Guangzhou R&F Properties Co. Ltd., Class H\* (a) | 609600 | 83094 |
|  Hanson International Tbk. PT\* <sup>‡</sup> | 2409275 |  |
|  Highwealth Construction Corp. | 35753 | 45992 |
|  Hopson Development Holdings Ltd.(a) | 28686 | 23022 |
|  Huaku Development Co. Ltd. | 88000 | 235140 |
|  Huijing Holdings Co. Ltd. | 102000 | 585 |
|  IOI Properties Group Bhd.\* | 52800 | 11503 |
|  JHSF Participacoes SA | 127576 | 178457 |
|  Jinke Properties Group Co. Ltd., Class A\* | 14100 | 3419 |
|  Kaisa Group Holdings Ltd.\* <sup>‡</sup> | 119714 | 7046 |
|  KE Holdings, Inc., ADR\* | 11270 | 114729 |
|  Kindom Development Co. Ltd. | 147400 | 110244 |
|  King's Town Construction Co. Ltd.\* | 2000 | 2120 |
|  Korea Real Estate Investment & Trust Co. Ltd. | 46140 | 44214 |
|  KWG Group Holdings Ltd.\* (a) | 485500 | 47005 |
|  LAMDA Development SA\* | 1368 | 8288 |
|  Logan Group Co. Ltd. | 29000 | 1182 |
|  Longfor Group Holdings Ltd.(c) | 49000 | 62422 |
|  LSR Group PJSC\* <sup>‡</sup> | 21295 |  |
|  Mabanee Co. KPSC | 13622 | 38348 |
|  Macrotech Developers Ltd.\* (b) | 825 | 9868 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  MAS P.L.C. | 18975 | $20774 |
|  MBK PCL, NVDR | 30344 | 14989 |
|  Megaworld Corp. | 444200 | 15944 |
|  Midea Real Estate Holding Ltd.(a) (b) | 107800 | 75255 |
|  Multiplan Empreendimentos Imobiliarios SA\* | 5000 | 25118 |
|  National Real Estate Co. KPSC\* | 11418 | 5161 |
|  NEPI Rockcastle NV | 10206 | 51370 |
|  Oberoi Realty Ltd. | 2915 | 32561 |
|  Origin Property PCL, NVDR | 413100 | 110710 |
|  OSK Holdings Bhd. | 406700 | 76557 |
|  Pakuwon Jati Tbk. PT | 534400 | 15007 |
|  Phoenix Mills Ltd. (The) | 1600 | 27599 |
|  Poly Developments and Holdings Group Co. Ltd., Class A | 29400 | 55589 |
|  Poly Property Group Co. Ltd.(a) | 784000 | 122846 |
|  Powerlong Real Estate Holdings Ltd. | 587000 | 47858 |
|  Prestige Estates Projects Ltd. | 3219 | 17188 |
|  Prince Housing & Development Corp. | 50000 | 15983 |
|  Pruksa Holding PCL, NVDR | 259500 | 81818 |
|  Quality Houses PCL, NVDR | 1821400 | 103369 |
|  Radiance Holdings Group Co. Ltd.(a) (b) | 273000 | 112680 |
|  Redco Properties Group Ltd.\* (a) (b) | 322000 | 68503 |
|  Redsun Properties Group Ltd.\* (a) | 391000 | 22414 |
|  RiseSun Real Estate Development Co. Ltd., Class A\* | 9400 | 2576 |
|  Robinsons Land Corp. | 23506 | 6019 |
|  Ruentex Development Co. Ltd. | 32400 | 39818 |
|  Salhia Real Estate Co. KSCP | 15502 | 23322 |
|  Saudi Real Estate Co.\* | 3478 | 11644 |
|  Seazen Group Ltd.\* (a) | 83808 | 13452 |
|  Seazen Holdings Co. Ltd., Class A\* | 4700 | 8494 |
|  S-Enjoy Service Group Co. Ltd.\* | 109000 | 49988 |

---

*See Accompanying Notes to the Financial Statements.* 

272 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Shanghai Jinqiao Export Processing Zone Development Co. Ltd., Class B | 112400 | $96889 |
|  Shanghai Lingang Holdings Corp. Ltd., Class A | 5640 | 8871 |
|  Shanghai Lujiazui Finance & Trade Zone Development Co. Ltd., Class A | 8000 | 9985 |
|  Shanghai Lujiazui Finance & Trade Zone Development Co. Ltd., Class B | 30940 | 22957 |
|  Shanghai Zhangjiang High-Tech Park Development Co. Ltd., Class A | 4700 | 7245 |
|  Shenzhen Investment Ltd.(a) | 882000 | 120224 |
|  Shimao Group Holdings Ltd.\* <sup>‡</sup> (a) | 32000 | 9910 |
|  Shimao Services Holdings Ltd.\* (a) (b) | 11000 | 1766 |
|  Shoucheng Holdings Ltd. | 110000 | 20039 |
|  Shui On Land Ltd.(a) | 1396500 | 128089 |
|  Sichuan Languang Justbon Services Group Co. Ltd., Class H\* | 26500 | 182803 |
|  Sime Darby Property Bhd. | 178200 | 17149 |
|  Sinic Holdings Group Co. Ltd., Class H\* <sup>‡</sup> (b) | 318000 |  |
|  Sino-Ocean Group Holding Ltd.(a) | 1173500 | 77737 |
|  Sinyi Realty, Inc. | 125000 | 108814 |
|  SK D&D Co. Ltd. | 3408 | 49286 |
|  SM Prime Holdings, Inc. | 215600 | 117194 |
|  SOHO China Ltd.\* | 76000 | 11134 |
|  SP Setia Bhd. Group | 75694 | 7685 |
|  Summarecon Agung Tbk. PT | 227900 | 8621 |
|  Sunac China Holdings Ltd.\* <sup>‡</sup> (a) | 145000 | 46530 |
|  Sunac Services Holdings Ltd.(a) (b) | 352000 | 61881 |
|  Supalai PCL, NVDR | 23800 | 13132 |
|  Talaat Moustafa Group | 413771 | 141350 |
|  United Development Co. QSC | 67999 | 26757 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  UOA Development Bhd. | 21800 | $| 7193 |
|  WHA Corp. PCL, NVDR | 117490 |  | 12163 |
|  Yuexiu Property Co. Ltd. | 41600 |  | 35506 |
|  Yungshin Construction & Development Co. Ltd. | 28000 |  | 52051 |
|  Zhejiang China Commodities City Group Co. Ltd., Class A | 5500 |  | 3157 |
|  Zhongliang Holdings Group Co. Ltd.(b) | 236500 |  | 10243 |
|  Zhuguang Holdings Group Co. Ltd.\* (a) | 100000 |  | 8153 |
|  |  |  | **6549971** |
| **Road & Rail – 0.4%** | **Road & Rail – 0.4%** | **Road & Rail – 0.4%** | **Road & Rail – 0.4%** |
|  Beijing-Shanghai High Speed Railway Co. Ltd., Class A | 59000 |  | 36054 |
|  BTS Group Holdings PCL, NVDR | 119640 |  | 26091 |
|  Container Corp. of India Ltd. | 4480 |  | 43189 |
|  Daqin Railway Co. Ltd., Class A | 40000 |  | 35130 |
|  Localiza Rent a Car SA | 12105 |  | 162730 |
|  Movida Participacoes SA | 55396 |  | 143788 |
|  Rumo SA | 19600 |  | 82699 |
|  SIMPAR SA | 116797 |  | 241062 |
|  United International Transportation Co. | 996 |  | 12127 |
|  Vamos Locacao de Caminhoes Maquinas e Equipamentos SA | 5500 |  | 16896 |
|  |  |  | **799766** |
| **Semiconductors & Semiconductor Equipment – 5.3%** | **Semiconductors & Semiconductor Equipment – 5.3%** | **Semiconductors & Semiconductor Equipment – 5.3%** | **Semiconductors & Semiconductor Equipment – 5.3%** |
|  ADATA Technology Co. Ltd. | 104000 |  | 173965 |
|  Advanced Wireless Semiconductor Co. | 10000 |  | 19179 |
|  Alchip Technologies Ltd. | 1000 |  | 20141 |
|  Amazing Microelectronic Corp. | 30000 |  | 76810 |
|  Andes Technology Corp. | 2379 |  | 27539 |
|  Anpec Electronics Corp. | 2000 |  | 6548 |
|  Ardentec Corp. | 147000 |  | 190921 |
|  ASE Technology Holding Co. Ltd. | 105000 |  | 261991 |
|  ASMedia Technology, Inc. | 1000 |  | 18062 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 273

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  ASPEED Technology, Inc. | 1000 | $52137 |
|  Borosil Renewables Ltd.\* | 20312 | 138321 |
|  China Resources Microelectronics Ltd., Class A | 1350 | 9370 |
|  Chipbond Technology Corp. | 21000 | 35454 |
|  ChipMOS Technologies, Inc. | 24000 | 23648 |
|  D&O Green Technologies Bhd. | 15300 | 12556 |
|  Daqo New Energy Corp., ADR\* | 1804 | 79358 |
|  DB HiTek Co. Ltd. | 1396 | 43366 |
|  Elan Microelectronics Corp. | 4000 | 10080 |
|  Elite Semiconductor Microelectronics Technology, Inc. | 5000 | 9683 |
|  eMemory Technology, Inc. | 1000 | 33362 |
|  ENNOSTAR, Inc. | 7000 | 8929 |
|  Eo Technics Co. Ltd. | 134 | 6133 |
|  Episil Technologies, Inc. | 6292 | 16988 |
|  Etron Technology, Inc. | 13647 | 14739 |
|  Eugene Technology Co. Ltd. | 65 | 983 |
|  Everlight Electronics Co. Ltd. | 175000 | 186011 |
|  Faraday Technology Corp. | 4000 | 17627 |
|  Fine Technix Co. Ltd. | 5107 | 8461 |
|  Fitipower Integrated Technology, Inc. | 3000 | 9683 |
|  Fittech Co. Ltd. | 27000 | 66196 |
|  Flat Glass Group Co. Ltd., Class A\* | 3600 | 16918 |
|  Flat Glass Group Co. Ltd., Class H(a) | 7000 | 16390 |
|  FocalTech Systems Co. Ltd. | 90000 | 191326 |
|  Formosa Advanced Technologies Co. Ltd. | 64000 | 74681 |
|  Formosa Sumco Technology Corp. | 1000 | 4515 |
|  GCL System Integration Technology Co. Ltd., Class A\* | 25500 | 11425 |
|  GemVax & Kael Co. Ltd.\* | 920 | 8009 |
|  Genesys Logic, Inc. | 3000 | 7765 |
|  GigaDevice Semiconductor, Inc., Class A | 1440 | 16232 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  Global Mixed Mode Technology, Inc. | 30000 | $120102 |
|  Global Unichip Corp. | 2000 | 30258 |
|  Globalwafers Co. Ltd. | 4000 | 44503 |
|  Greatek Electronics, Inc. | 14000 | 20203 |
|  HAESUNG DS Co. Ltd. | 379 | 10111 |
|  Hana Materials, Inc. | 318 | 6842 |
|  Hana Micron, Inc.\* | 871 | 5717 |
|  Hangzhou First Applied Material Co. Ltd., Class A | 2660 | 23347 |
|  Hangzhou Silan Microelectronics Co. Ltd., Class A | 2900 | 12476 |
|  Holtek Semiconductor, Inc. | 6000 | 12364 |
|  Hua Hong Semiconductor Ltd.\* (a) (b) | 11000 | 25756 |
|  Inari Amertron Bhd. | 37200 | 19591 |
|  Innox Advanced Materials Co. Ltd. | 843 | 16186 |
|  ITE Technology, Inc. | 59000 | 108946 |
|  JA Solar Technology Co. Ltd., Class A | 3780 | 32369 |
|  JCET Group Co. Ltd., Class A | 5300 | 17486 |
|  Jentech Precision Industrial Co. Ltd. | 2199 | 23954 |
|  Jusung Engineering Co. Ltd. | 14612 | 117454 |
|  King Yuan Electronics Co. Ltd. | 35000 | 35519 |
|  Kinsus Interconnect Technology Corp. | 4000 | 12972 |
|  LandMark Optoelectronics Corp. | 5000 | 14384 |
|  LEENO Industrial, Inc. | 180 | 17287 |
|  LONGi Green Energy Technology Co. Ltd., Class A | 10048 | 66054 |
|  LX Semicon Co. Ltd. | 411 | 23919 |
|  Macronix International Co. Ltd. | 48000 | 44391 |
|  MediaTek, Inc. | 28000 | 512685 |
|  Montage Technology Co. Ltd., Class A | 3246 | 25235 |
|  Nanya Technology Corp. | 30000 | 50741 |
|  NAURA Technology Group Co. Ltd., Class A | 900 | 32764 |
|  NEPES Corp.\* | 1325 | 16976 |
|  NEXTIN, Inc. | 265 | 9637 |

---

*See Accompanying Notes to the Financial Statements.* 

274 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  Novatek Microelectronics Corp. | 18000 | $134626 |
|  Nuvoton Technology Corp. | 4000 | 12724 |
|  Pan Jit International, Inc. | 8000 | 13680 |
|  Parade Technologies Ltd. | 1400 | 26460 |
|  Phison Electronics Corp. | 6000 | 55024 |
|  Pixart Imaging, Inc. | 9000 | 22540 |
|  Powerchip Semiconductor Manufacturing Corp. | 80000 | 76468 |
|  Powertech Technology, Inc. | 20000 | 46303 |
|  Radiant Opto-Electronics Corp. | 14330 | 43760 |
|  RDC Semiconductor Co. Ltd.\* | 3000 | 12988 |
|  Realtek Semiconductor Corp. | 9070 | 71777 |
|  RFHIC Corp. | 829 | 12251 |
|  RichWave Technology Corp. | 5072 | 15017 |
|  S&S Tech Corp. | 423 | 7379 |
|  SDI Corp. | 8000 | 22171 |
|  Shanghai Fudan Microelectronics Group Co. Ltd., Class A | 1050 | 13499 |
|  Shanghai Fudan Microelectronics Group Co. Ltd., Class H | 4000 | 17325 |
|  Sigurd Microelectronics Corp. | 147000 | 212134 |
|  Silergy Corp. | 5000 | 58034 |
|  Silicon Integrated Systems Corp. | 18964 | 8946 |
|  SIMMTECH Co. Ltd. | 1039 | 25784 |
|  Sino-American Silicon Products, Inc. | 18000 | 69268 |
|  Sitronix Technology Corp. | 4000 | 20545 |
|  SK Hynix, Inc. | 15827 | 918876 |
|  SK Square Co. Ltd.\* | 1604 | 41608 |
|  Sonix Technology Co. Ltd. | 66000 | 94117 |
|  Sunplus Technology Co. Ltd. | 29000 | 20295 |
|  Taiwan Mask Corp. | 7000 | 12817 |
|  Taiwan Semiconductor Co. Ltd. | 9000 | 20948 |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 325000 | 3933587 |
|  Taiwan Surface Mounting Technology Corp. | 5000 | 12709 |
|  Taiwan-Asia Semiconductor Corp. | 13000 | 12769 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  TCL Zhonghuan Renewable Energy Technology Co. Ltd., Class A | 4700 | $| 25436 |
|  TES Co. Ltd. | 6243 |  | 69686 |
|  Tianshui Huatian Technology Co. Ltd., Class A | 10800 |  | 13051 |
|  Tokai Carbon Korea Co. Ltd. | 86 |  | 6128 |
|  TongFu Microelectronics Co. Ltd., Class A\* | 4700 |  | 12126 |
|  Topco Scientific Co. Ltd. | 64000 |  | 296935 |
|  Trina Solar Co. Ltd., Class A | 3871 |  | 35233 |
|  TSE Co. Ltd. | 165 |  | 4454 |
|  TSEC Corp.\* | 25241 |  | 26242 |
|  Unigroup Guoxin Microelectronics Co. Ltd., Class A | 1679 |  | 37753 |
|  United Microelectronics Corp.\* | 350000 |  | 424703 |
|  United Renewable Energy Co. Ltd.\* | 40574 |  | 26443 |
|  UniTest, Inc.\* | 636 |  | 5693 |
|  Vanguard International Semiconductor Corp. | 18000 |  | 37092 |
|  Via Technologies, Inc. | 90000 |  | 179036 |
|  Visual Photonics Epitaxy Co. Ltd. | 10000 |  | 17938 |
|  ViTrox Corp. Bhd. | 9600 |  | 14376 |
|  Wafer Works Corp. | 11511 |  | 14254 |
|  Will Semiconductor Co. Ltd. Shanghai, Class A | 2025 |  | 20357 |
|  Win Semiconductors Corp. | 6961 |  | 26356 |
|  Winbond Electronics Corp. | 89000 |  | 53860 |
|  WONIK IPS Co. Ltd. | 824 |  | 15908 |
|  Wonik QnC Corp. | 818 |  | 13983 |
|  XinTec, Inc. | 3000 |  | 8910 |
|  Xinyi Solar Holdings Ltd. | 81343 |  | 80723 |
|  |  |  | **10968836** |
| **Software – 0.3%** | **Software – 0.3%** | **Software – 0.3%** | **Software – 0.3%** |
|  360 Security Technology, Inc., Class A | 15500 |  | 15036 |
|  Ahnlab, Inc. | 190 |  | 8310 |
|  AsiaInfo Technologies Ltd.(b) | 21200 |  | 25333 |
|  Beijing Kingsoft Office Software, Inc., Class A | 872 |  | 34736 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 275

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Birlasoft Ltd. | 9308 | $| 30456 |
|  Cyient Ltd. | 4410 |  | 39919 |
|  Douzone Bizon Co. Ltd. | 530 |  | 11348 |
|  Hancom, Inc.\* | 294 |  | 2704 |
|  Hundsun Technologies, Inc., Class A | 4550 |  | 25984 |
|  Iflytek Co. Ltd., Class A | 4700 |  | 22558 |
|  Intellect Design Arena Ltd. | 4762 |  | 24829 |
|  Kingdee International Software Group Co. Ltd.\* | 49000 |  | 80149 |
|  KPIT Technologies Ltd. | 6307 |  | 54039 |
|  Linklogis, Inc., Class B\* (a) (b) | 53000 |  | 18500 |
|  Ming Yuan Cloud Group Holdings Ltd.(a) | 11000 |  | 5059 |
|  NavInfo Co. Ltd., Class A | 4700 |  | 7637 |
|  Oracle Financial Services Software Ltd. | 632 |  | 22240 |
|  Route Mobile Ltd. | 954 |  | 15098 |
|  Shanghai Baosight Software Co. Ltd., Class A | 3510 |  | 20352 |
|  Shanghai Baosight Software Co. Ltd., Class B | 11609 |  | 34978 |
|  Tanla Platforms Ltd. | 1963 |  | 17597 |
|  Tata Elxsi Ltd. | 635 |  | 53666 |
|  TOTVS SA\* | 9900 |  | 62563 |
|  Weimob, Inc.\* (a) (b) | 87000 |  | 30478 |
|  Yonyou Network Technology Co. Ltd., Class A | 4700 |  | 15738 |
|  |  |  | **679307** |
| **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** |
|  Abu Dhabi National Oil Co. for Distribution PJSC | 48412 |  | 59443 |
|  Ace Hardware Indonesia Tbk. PT | 206000 |  | 7462 |
|  Bermaz Auto Bhd. | 56000 |  | 23452 |
|  China Meidong Auto Holdings Ltd.(a) | 8000 |  | 10517 |
|  China Tourism Group Duty Free Corp. Ltd., Class A | 2500 |  | 54928 |
|  China Yongda Automobiles Services Holdings Ltd. | 514500 |  | 230710 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Chow Tai Fook Jewellery Group Ltd. | 42600 | $72937 |
|  Com7 PCL, NVDR | 22000 | 17486 |
|  Cuckoo Homesys Co. Ltd. | 3038 | 61210 |
|  Detsky Mir PJSC<sup>‡</sup> | 258500 |  |
|  Dogan Sirketler Grubu Holding A/S | 425271 | 136248 |
|  Dogus Otomotiv Servis ve Ticaret A/S | 12557 | 82755 |
|  EEKA Fashion Holdings Ltd. | 98000 | 127340 |
|  Foschini Group Ltd. (The) | 6321 | 39524 |
|  GOME Retail Holdings Ltd.\* (a) | 383447 | 6252 |
|  Grupo SBF SA | 5300 | 19130 |
|  Home Product Center PCL, NVDR | 78600 | 30151 |
|  Hotai Motor Co. Ltd. | 6000 | 108744 |
|  Hotel Shilla Co. Ltd. | 470 | 21447 |
|  Italtile Ltd. | 10931 | 8179 |
|  Jarir Marketing Co. | 839 | 36619 |
|  JUMBO SA | 3506 | 49864 |
|  K Car Co. Ltd. | 176 | 1390 |
|  Lojas Renner SA\* | 16350 | 96282 |
|  LOTTE Himart Co. Ltd. | 4108 | 38068 |
|  M.Video PJSC<sup>‡</sup> | 31680 |  |
|  Motus Holdings Ltd. | 68796 | 434619 |
|  MR DIY Group M Bhd.(b) | 63600 | 27173 |
|  Mr Price Group Ltd. | 5194 | 49980 |
|  Pan German Universal Motors Ltd. | 9000 | 55303 |
|  Pepkor Holdings Ltd.(b) | 25185 | 31068 |
|  Pet Center Comercio e Participacoes SA | 11807 | 19711 |
|  Pop Mart International Group Ltd.(a) (b) | 13000 | 16826 |
|  PTT Oil & Retail Business PCL, NVDR | 54200 | 34320 |
|  Shanghai Yuyuan Tourist Mart Group Co. Ltd. | 18800 | 16150 |
|  Shinsegae International, Inc. | 6517 | 107744 |
|  Siam Global House PCL, NVDR | 38944 | 20567 |
|  Super Group Ltd. | 142806 | 201883 |

---

*See Accompanying Notes to the Financial Statements.* 

276 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Topsports International Holdings Ltd.(b) | 52000 | $| 26232 |
|  Truworths International Ltd. | 162288 |  | 461497 |
|  United Electronics Co. | 1619 |  | 32961 |
|  Via S/A\* | 568400 |  | 339052 |
|  Vibra Energia SA | 29400 |  | 102254 |
|  Zhongsheng Group Holdings Ltd. | 9000 |  | 34166 |
|  |  |  | **3351644** |
| **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** | **Technology Hardware, Storage & Peripherals – 4.7%** |
|  Acer, Inc. | 97858 |  | 67116 |
|  Advantech Co. Ltd. | 7941 |  | 72208 |
|  Asia Vital Components Co. Ltd. | 8000 |  | 25324 |
|  ASROCK, Inc. | 21000 |  | 63868 |
|  Asustek Computer, Inc. | 20000 |  | 146481 |
|  AURAS Technology Co. Ltd. | 30000 |  | 111723 |
|  Catcher Technology Co. Ltd. | 14000 |  | 73644 |
|  Chicony Electronics Co. Ltd. | 15992 |  | 39754 |
|  China Greatwall Technology Group Co. Ltd., Class A | 5500 |  | 8402 |
|  Clevo Co. | 196000 |  | 187043 |
|  Compal Electronics, Inc. | 134000 |  | 87746 |
|  CosmoAM&T Co. Ltd.\* | 450 |  | 21198 |
|  Darfon Electronics Corp. | 71000 |  | 83400 |
|  Ennoconn Corp. | 2000 |  | 11483 |
|  Getac Holdings Corp. | 166000 |  | 200658 |
|  Gigabyte Technology Co. Ltd. | 18000 |  | 51672 |
|  HTC Corp.\* | 18000 |  | 28210 |
|  Innodisk Corp. | 4872 |  | 24948 |
|  Inventec Corp. | 70000 |  | 53006 |
|  Legend Holdings Corp., Class H(b) | 234500 |  | 196864 |
|  Lenovo Group Ltd. | 196000 |  | 156803 |
|  Lite-On Technology Corp. | 72000 |  | 143006 |
|  Micro-Star International Co. Ltd. | 21000 |  | 71363 |
|  Mitac Holdings Corp. | 33600 |  | 28259 |
|  Multilaser Industrial SA | 63700 |  | 63248 |
|  Ninestar Corp., Class A | 2900 |  | 22692 |
|  Pegatron Corp. | 61000 |  | 111692 |
|  Qisda Corp. | 56000 |  | 42666 |
|  Quanta Computer, Inc. | 82000 |  | 174065 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** |
|  Samsung Electronics Co. Ltd. | 152488 | $| 6358796 |
|  Samsung Electronics Co. Ltd. (Preference) | 24696 |  | 924074 |
|  Shenzhen Transsion Holdings Co. Ltd., Class A | 2200 |  | 18728 |
|  Wistron Corp. | 98000 |  | 79227 |
|  Wiwynn Corp. | 3000 |  | 67406 |
|  |  |  | **9816773** |
| **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** |
|  361 Degrees International Ltd.\* (a) | 366000 |  | 152464 |
|  Aditya Birla Fashion and Retail Ltd.\* | 6536 |  | 27943 |
|  Aksa Akrilik Kimya Sanayii A/S | 49588 |  | 185659 |
|  Alok Industries Ltd.\* | 23980 |  | 4490 |
|  Alpargatas SA (Preference) | 5500 |  | 23018 |
|  ANTA Sports Products Ltd. | 19600 |  | 172284 |
|  Arezzo Industria e Comercio SA | 1748 |  | 34812 |
|  Bata India Ltd. | 848 |  | 18730 |
|  Bosideng International Holdings Ltd.(a) | 54000 |  | 23320 |
|  COWELL FASHION Co. Ltd. | 9978 |  | 35584 |
|  DI Dong Il Corp. | 5194 |  | 52507 |
|  Eclat Textile Co. Ltd. | 3698 |  | 48718 |
|  F&F Co. Ltd. | 275 |  | 28090 |
|  Feng TAY Enterprise Co. Ltd. | 10600 |  | 52799 |
|  FF Group\* <sup>‡</sup> | 3536 |  |  |
|  Fila Holdings Corp. | 1167 |  | 26790 |
|  Formosa Taffeta Co. Ltd. | 49000 |  | 39005 |
|  Fuguiniao Group Ltd.\* <sup>‡</sup> | 334800 |  |  |
|  Fulgent Sun International Holding Co. Ltd. | 4000 |  | 16945 |
|  Garware Technical Fibres Ltd. | 450 |  | 19032 |
|  Golden Solar New Energy Technology Holdings Ltd.\* (a) | 42000 |  | 41947 |
|  Grendene SA | 8264 |  | 11434 |
|  Grupo de Moda Soma SA | 15900 |  | 44119 |
|  Handsome Co. Ltd. | 4851 |  | 85479 |
|  Hansae Co. Ltd. | 1281 |  | 13265 |
|  Hwaseung Enterprise Co. Ltd. | 331 |  | 2050 |
|  KPR Mill Ltd. | 1754 |  | 11694 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 277

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##### [**Table of Contents**](#toc)

------

FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** |
|  Lao Feng Xiang Co. Ltd., Class B | 2500 | $| 7000 |
|  LF Corp. | 5831 |  | 60789 |
|  Li Ning Co. Ltd. | 39500 |  | 204297 |
|  Makalot Industrial Co. Ltd. | 4334 |  | 26900 |
|  Nature Holdings Co. Ltd. (The) | 3211 |  | 60525 |
|  Page Industries Ltd. | 118 |  | 70946 |
|  Paiho Shih Holdings Corp. | 49000 |  | 38321 |
|  Pou Chen Corp. | 63000 |  | 53278 |
|  Rajesh Exports Ltd. | 2600 |  | 21723 |
|  Relaxo Footwears Ltd. | 2248 |  | 26270 |
|  Ruentex Industries Ltd. | 28819 |  | 49369 |
|  Shenzhou International Group Holdings Ltd. | 14700 |  | 101872 |
|  Shinsung Tongsang Co. Ltd.\* | 15550 |  | 25763 |
|  Tainan Spinning Co. Ltd. | 48555 |  | 24411 |
|  Taiwan Paiho Ltd. | 100000 |  | 151447 |
|  Texhong Textile Group Ltd. | 122500 |  | 78963 |
|  Titan Co. Ltd. | 7301 |  | 243565 |
|  Trident Ltd. | 22165 |  | 9439 |
|  Vaibhav Global Ltd. | 41 |  | 174 |
|  Vardhman Textiles Ltd. | 43855 |  | 178302 |
|  VIP Industries Ltd. | 3025 |  | 27302 |
|  Viva China Holdings Ltd.\* (a) | 1176000 |  | 146816 |
|  Vivara Participacoes SA | 5300 |  | 27080 |
|  Welspun India Ltd. | 7370 |  | 6976 |
|  Xtep International Holdings Ltd.(a) | 27500 |  | 25223 |
|  Youngone Corp. | 890 |  | 29553 |
|  Youngone Holdings Co. Ltd. | 2414 |  | 91683 |
|  |  |  | **2960165** |
| **Thrifts & Mortgage Finance – 0.2%** | **Thrifts & Mortgage Finance – 0.2%** | **Thrifts & Mortgage Finance – 0.2%** | **Thrifts & Mortgage Finance – 0.2%** |
|  Aavas Financiers Ltd.\* | 611 |  | 14901 |
|  Can Fin Homes Ltd. | 4876 |  | 30887 |
|  IIFL Finance Ltd. | 4595 |  | 23309 |
|  Indiabulls Housing Finance Ltd.\* | 159152 |  | 248694 |
|  LIC Housing Finance Ltd. | 10094 |  | 49423 |
|  PNB Housing Finance Ltd.\* (b) | 10604 |  | 56365 |
|  Sangsangin Co. Ltd. | 13573 |  | 61745 |
|  |  |  | **485324** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Tobacco – 0.3%** | **Tobacco – 0.3%** | **Tobacco – 0.3%** |
|  British American Tobacco Malaysia Bhd. | 400 | $890 |
|  Eastern Co. SAE | 27721 | 13648 |
|  Gudang Garam Tbk. PT | 14900 | 23023 |
|  ITC Ltd. | 51107 | 215288 |
|  KT&G Corp. | 3254 | 218616 |
|  RLX Technology, Inc., ADR\* (a) | 29825 | 37281 |
|  Smoore International Holdings Ltd.(a) (b) | 33000 | 35103 |
|  |  | **543849** |
| **Trading Companies & Distributors – 0.4%** | **Trading Companies & Distributors – 0.4%** | **Trading Companies & Distributors – 0.4%** |
|  Adani Enterprises Ltd. | 4622 | 186910 |
|  ALAFCO Aviation Lease & Finance Co. KSCP\* | 3260 | 1768 |
|  Armac Locacao Logistica E Servicos SA | 5000 | 15361 |
|  Barloworld Ltd. | 74284 | 416136 |
|  BOC Aviation Ltd.(a) (b) | 5100 | 34141 |
|  Chin Hin Group Bhd. | 29300 | 17414 |
|  COSCO SHIPPING Development Co. Ltd., Class A | 37600 | 12570 |
|  COSCO SHIPPING Development Co. Ltd., Class H | 62000 | 7187 |
|  IndiaMart InterMesh Ltd.(b) | 192 | 10650 |
|  LX International Corp. | 800 | 22830 |
|  Posco International Corp. | 1484 | 21513 |
|  Realord Group Holdings Ltd.\* (a) | 12000 | 14079 |
|  SK Networks Co. Ltd. | 2415 | 6833 |
|  Xiamen C & D, Inc., Class A | 9400 | 15442 |
|  |  | **782834** |
| **Transportation Infrastructure – 1.0%** | **Transportation Infrastructure – 1.0%** | **Transportation Infrastructure – 1.0%** |
|  Adani Ports & Special Economic Zone Ltd. | 11172 | 111150 |
|  Airports of Thailand PCL\* | 54000 | 104283 |
|  Airports of Thailand PCL, NVDR\* | 28900 | 56190 |
|  Anhui Expressway Co. Ltd., Class H | 136000 | 86972 |

---

*See Accompanying Notes to the Financial Statements.* 

278 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** |
|  Bangkok Expressway & Metro PCL, NVDR | 142000 | $35071 |
|  Beijing Capital International Airport Co. Ltd., Class H\* (a) | 56000 | 30319 |
|  CCR SA | 19982 | 49353 |
|  China Merchants Port Holdings Co. Ltd. | 38410 | 45016 |
|  COSCO SHIPPING Ports Ltd. | 59348 | 29259 |
|  EcoRodovias Infraestrutura e Logistica SA\* | 4700 | 4873 |
|  Evergreen International Storage & Transport Corp. | 16000 | 12910 |
|  GMR Airports Infrastructure Ltd.\* | 48418 | 21905 |
|  Grupo Aeroportuario del Centro Norte SAB de CV | 11981 | 95273 |
|  Grupo Aeroportuario del Pacifico SAB de CV, Class B | 5736 | 88689 |
|  Grupo Aeroportuario del Sureste SAB de CV, Class B | 3410 | 79662 |
|  Guangdong Provincial Expressway Development Co. Ltd., Class B | 122500 | 78963 |
|  International Container Terminal Services, Inc. | 16170 | 48273 |
|  Jasa Marga Persero Tbk. PT\* | 39723 | 8684 |
|  Jiangsu Expressway Co. Ltd., Class H | 32000 | 22543 |
|  Lingkaran Trans Kota Holdings Bhd. | 107100 | 113261 |
|  Malaysia Airports Holdings Bhd.\* | 27900 | 35288 |
|  Ningbo Zhoushan Port Co. Ltd., Class A | 23500 | 11173 |
|  Novorossiysk Commercial Sea Port PJSC<sup>‡</sup> | 189696 |  |
|  Promotora y Operadora de Infraestructura SAB de CV | 2160 | 16219 |
|  Qingdao Port International Co. Ltd., Class H(b) | 47000 | 19699 |
|  Saudi Ground Services Co.\* | 4431 | 30660 |
|  Shanghai International Airport Co. Ltd., Class A\* | 3600 | 26329 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** | **Transportation Infrastructure – (continued)** |
|  Shanghai International Port Group Co. Ltd., Class A | 56700 | $| 40164 |
|  Shenzhen International Holdings Ltd.(a) | 33343 |  | 22427 |
|  Sichuan Expressway Co. Ltd., Class H | 294000 |  | 60674 |
|  Taiwan High Speed Rail Corp. | 50000 |  | 43603 |
|  TAV Havalimanlari Holding A/S\* | 10176 |  | 42886 |
|  Westports Holdings Bhd. | 17500 |  | 12437 |
|  Wilson Sons Holdings Brasil SA | 79560 |  | 172091 |
|  Yuexiu Transport Infrastructure Ltd.(a) | 392000 |  | 153307 |
|  Zhejiang Expressway Co. Ltd., Class H | 524000 |  | 325087 |
|  |  |  | **2134693** |
| **Water Utilities – 0.6%** | **Water Utilities – 0.6%** | **Water Utilities – 0.6%** | **Water Utilities – 0.6%** |
|  Aguas Andinas SA, Class A | 1053095 |  | 222041 |
|  Athens Water Supply & Sewage Co. SA | 10591 |  | 75367 |
|  Beijing Enterprises Water Group Ltd.(a) | 132000 |  | 27746 |
|  China Water Affairs Group Ltd.(a) | 346000 |  | 245070 |
|  Cia de Saneamento Basico do Estado de Sao Paulo\* | 4900 |  | 56123 |
|  Cia de Saneamento de Minas Gerais-COPASA\* | 70639 |  | 206778 |
|  Cia de Saneamento do Parana | 93512 |  | 341097 |
|  Guangdong Investment Ltd. | 40000 |  | 25223 |
|  Luenmei Quantum Co. Ltd., Class A | 9400 |  | 8024 |
|  Manila Water Co., Inc. | 37900 |  | 10686 |
|  National Central Cooling Co. PJSC | 24552 |  | 21256 |
|  |  |  | **1239411** |
| **Wireless Telecommunication Services – 1.1%** | **Wireless Telecommunication Services – 1.1%** | **Wireless Telecommunication Services – 1.1%** | **Wireless Telecommunication Services – 1.1%** |
|  Advanced Info Service PCL, NVDR | 20300 |  | 101873 |
|  America Movil SAB de CV, Series L | 558700 |  | 527766 |
|  Axiata Group Bhd. | 77304 |  | 46598 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 279

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** |
|  Bharti Airtel Ltd. | 43361 | $| 435823 |
|  DiGi.Com Bhd. | 63700 |  | 51062 |
|  Empresa Nacional de Telecomunicaciones SA | 58053 |  | 181168 |
|  Etihad Etisalat Co. | 7632 |  | 74339 |
|  Far EasTone Telecommunications Co. Ltd. | 30000 |  | 65824 |
|  Globe Telecom, Inc. | 887 |  | 35541 |
|  Indosat Tbk. PT | 31800 |  | 13813 |
|  Intouch Holdings PCL, NVDR | 23300 |  | 44078 |
|  Kuwait Telecommunications Co. | 10890 |  | 20743 |
|  Maxis Bhd. | 32900 |  | 26791 |
|  Mobile Telecommunications Co. KSCP | 30838 |  | 59635 |
|  Mobile Telecommunications Co. Saudi Arabia\* | 8508 |  | 29390 |
|  Mobile TeleSystems PJSC<sup>‡</sup> | 31356 |  |  |
|  MTN Group Ltd. | 14210 |  | 100396 |
|  PLDT, Inc. | 2735 |  | 77118 |
|  Sistema PJSFC\* <sup>‡</sup> | 122643 |  |  |
|  SK Telecom Co. Ltd. | 3127 |  | 109981 |
|  Smartfren Telecom Tbk. PT\* | 2936200 |  | 14683 |
|  Taiwan Mobile Co. Ltd. | 30000 |  | 88541 |
|  TIM SA\* | 8600 |  | 21634 |
|  Turkcell Iletisim Hizmetleri A/S | 37864 |  | 52187 |
|  Vodacom Group Ltd. | 12005 |  | 81858 |
|  Vodafone Idea Ltd.\* | 97468 |  | 10067 |
|  Vodafone Qatar QSC | 105056 |  | 48291 |
|  |  |  | **2319200** |
| **Total Common Stocks <br>(Cost $227,162,575)** | **Total Common Stocks <br>(Cost $227,162,575)** |  | **206012330** |
|  | Principal<br>Amount |  |  |
| **CORPORATE BONDS – 0.0%(d)** | **CORPORATE BONDS – 0.0%(d)** | **CORPORATE BONDS – 0.0%(d)** | **CORPORATE BONDS – 0.0%(d)** |
| **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** |
|  NTPC Ltd.<br>Series 54,<br>8.49%, 3/25/2025<br>(Cost $—) | INR 49,126 |  | 7923 |

---

---

| | | |
|:---|:---|:---|
| Investments | Number of<br>Rights | Value |
| **RIGHTS – 0.0%(d)** | **RIGHTS – 0.0%(d)** | **RIGHTS – 0.0%(d)** |
| **Airlines – 0.0%(d)** | **Airlines – 0.0%(d)** | **Airlines – 0.0%(d)** |
|  Jeju Air Co. Ltd., expiring 11/4/2022, price 11,250.00 KRW\* | 860 | $59 |
| **Banks – 0.0%(d)** | **Banks – 0.0%(d)** | **Banks – 0.0%(d)** |
|  Shanghai Comm & Savings Bank Trust Department (The), expiring 11/8/2022, price 37.00 TWD\* | 9236 | 2694 |
| **Food Products – 0.0%** | **Food Products – 0.0%** | **Food Products – 0.0%** |
|  Thai Union Group PCL, expiring 1/31/2023, price 0.25 THB\* <sup>‡</sup> | 2330 |  |
| **Health Care Providers & Services – 0.0%(d)** | **Health Care Providers & Services – 0.0%(d)** | **Health Care Providers & Services – 0.0%(d)** |
|  Fleury SA, expiring 11/21/2022, price 17.27 BRL\* | 800 | 198 |
| **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(d)** |
|  Omega Energia SA, expiring 11/7/2022, price 16.00 BRL\* | 1592 | 6 |
| **Insurance – 0.0%(d)** | **Insurance – 0.0%(d)** | **Insurance – 0.0%(d)** |
|  Mercuries Life Insurance Co. Ltd.,<br>expiring 10/28/2022, price 5.20 TWD\* | 32545 | 283 |
| **Leisure Products – 0.0%(d)** | **Leisure Products – 0.0%(d)** | **Leisure Products – 0.0%(d)** |
|  HLB, Inc.,<br>expiring 12/1/2022, price 30,700.00 KRW\* | 148 | 1018 |
| **Pharmaceuticals – 0.0%(d)** | **Pharmaceuticals – 0.0%(d)** | **Pharmaceuticals – 0.0%(d)** |
|  Oscotec, Inc.,<br>expiring 11/7/2022, price 14,750.00 KRW\* | 306 | 602 |
| **Total Rights <br>(Cost $—)** | **Total Rights <br>(Cost $—)** | **4860** |

---

*See Accompanying Notes to the Financial Statements.* 

280 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SECURITIES LENDING REINVESTMENTS(e) – 1.5%** | **SECURITIES LENDING REINVESTMENTS(e) – 1.5%** | **SECURITIES LENDING REINVESTMENTS(e) – 1.5%** |
| **REPURCHASE AGREEMENTS – 1.5%** | **REPURCHASE AGREEMENTS – 1.5%** | **REPURCHASE AGREEMENTS – 1.5%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $3,027,949, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $3,049,202<br>(Cost $3,027,697) | $3027697 | $3027697 |
| **Total Investments – 101.0% <br>(Cost $230,190,272)** | **Total Investments – 101.0% <br>(Cost $230,190,272)** | **209052810** |
|  Liabilities in excess of other assets – (1.0%) | Liabilities in excess of other assets – (1.0%) | (2163897) |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**206888913** |

---

*\** *Non-income producing security.* 

*‡* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $8,215,520, collateralized in the form of cash with a value of $3,027,697 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $4,107,745 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $1,829,206 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 8, 2023 – June 30, 2120; a total value of $8,964,648.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(d)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(e)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $3,027,697.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*GDR – Global Depositary Receipt* 

*NVDR – Non-Voting Depositary Receipt* 

*OJSC – Open Joint Stock Company* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*SCA – Limited partnership with share capital* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $34504723 |
|  Aggregate gross unrealized depreciation | (60205659) |
|  Net unrealized depreciation | $(25700936) |
|  Federal income tax cost | $234581137 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI Emerging Markets E-Mini Index | 43 | 12/16/2022 | USD | $1835240 | $(177121) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 281

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

------

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 957774 | Goldman Sachs & Co. | HKD | 7506137 | 12/21/2022 | $947 |
|  USD | 283787 | Citibank NA | INR\* | 22818500 | 12/21/2022 | 9288 |
|  USD | 44610 | Citibank NA | KRW\* | 61816590 | 12/21/2022 | 1168 |
|  USD | 940495 | Citibank NA | TWD\* | 29366120 | 12/21/2022 | 25217 |
|  USD | 26276 | JPMorgan Chase Bank | ZAR | 470000 | 12/21/2022 | 801 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $37421 |
|  BRL\* | 2030000 | Goldman Sachs & Co. | USD | 387834 | 12/21/2022 | $(5051) |
|  HKD | 3500000 | Bank of Montreal | USD | 446590 | 12/21/2022 | (435) |
|  INR\* | 13970000 | Goldman Sachs & Co. | USD | 170165 | 12/21/2022 | (2110) |
|  KRW\* | 180000000 | BNP Paribas SA | USD | 128459 | 12/21/2022 | (1964) |
|  TWD\* | 26810000 | Citibank NA | USD | 851682 | 12/21/2022 | (16073) |
|  USD | 405593 | Citibank NA | BRL\* | 2189553 | 12/21/2022 | (7276) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(32909) |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | $4512 |

---

*\** *Non-deliverable forward. See Note 2 in the Notes to Financial Statements.* 

*Abbreviations:* 

*BRL – Brazilian Real* 

*HKD – Hong Kong Dollar* 

*INR – Indian Rupee* 

*KRW – Korean Won* 

*TWD – Taiwan Dollar* 

*USD – US Dollar* 

*ZAR – South African Rand* 

*See Accompanying Notes to the Financial Statements.* 

282 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Emerging Markets Factor Tilt Index Fund (cont.)

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*FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Brazil | 7.7 | % |
|  Chile | 1.2 |  |
|  China | 24.4 |  |
|  Colombia | 0.5 |  |
|  Czech Republic | 0.1 |  |
|  Egypt | 0.3 |  |
|  Greece | 0.3 |  |
|  Hungary | 0.2 |  |
|  India | 13.1 |  |
|  Indonesia | 2.5 |  |
|  Kuwait | 0.8 |  |
|  Malaysia | 2.3 |  |
|  Mexico | 2.4 |  |
|  Pakistan | 0.6 |  |
|  Peru | 0.4 |  |
|  Philippines | 0.8 |  |
|  Qatar | 1 |  |
|  Saudi Arabia | 2.7 |  |
|  South Africa | 4.2 |  |
|  South Korea | 13.7 |  |
|  Taiwan | 14.4 |  |
|  Thailand | 2.2 |  |
|  Turkey | 1.7 |  |
|  United Arab Emirates | 2 |  |
|  United Kingdom | 0 | <sup>†</sup> |
|  United States | 0 | <sup>†</sup> |
|  Other<sup>1</sup> | 0.5 |  |
|  | 100 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.6 |
|  Corporate Bonds | 0.0 |
|  Rights | 0.0 |
|  Securities Lending Reinvestments | 1.5 |
|  Others<sup>(1)</sup> | (1.1 |
|  | 100.0 |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 283

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> US Quality Large Cap Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.5%** | **COMMON STOCKS – 98.5%** | **COMMON STOCKS – 98.5%** |
| **Aerospace & Defense – 1.0%** | **Aerospace & Defense – 1.0%** | **Aerospace & Defense – 1.0%** |
|  General Dynamics Corp. | 1534 | $383193 |
|  Lockheed Martin Corp. | 1652 | 803995 |
|  Textron, Inc. | 472 | 32304 |
|  |  | **1219492** |
| **Air Freight & Logistics – 1.5%** | **Air Freight & Logistics – 1.5%** | **Air Freight & Logistics – 1.5%** |
|  Expeditors International of Washington, Inc. | 6254 | 611954 |
|  United Parcel Service, Inc., Class B | 7788 | 1306593 |
|  |  | **1918547** |
| **Automobiles – 1.7%** | **Automobiles – 1.7%** | **Automobiles – 1.7%** |
|  Ford Motor Co. | 20178 | 269780 |
|  Tesla, Inc.\* | 8614 | 1960029 |
|  |  | **2229809** |
| **Banks – 4.2%** | **Banks – 4.2%** | **Banks – 4.2%** |
|  Bank of America Corp. | 26078 | 939851 |
|  Citigroup, Inc. | 29854 | 1369104 |
|  Citizens Financial Group, Inc. | 8024 | 328182 |
|  Fifth Third Bancorp | 14042 | 501159 |
|  JPMorgan Chase & Co. | 708 | 89123 |
|  Wells Fargo & Co. | 46728 | 2149021 |
|  |  | **5376440** |
| **Biotechnology – 2.7%** | **Biotechnology – 2.7%** | **Biotechnology – 2.7%** |
|  AbbVie, Inc. | 2124 | 310954 |
|  Amgen, Inc. | 7670 | 2073584 |
|  Gilead Sciences, Inc. | 3422 | 268490 |
|  Moderna, Inc.\* (a) | 2124 | 319301 |
|  Regeneron Pharmaceuticals, Inc.\* | 178 | 133278 |
|  Vertex Pharmaceuticals, Inc.\* | 944 | 294528 |
|  |  | **3400135** |
| **Building Products – 0.4%** | **Building Products – 0.4%** | **Building Products – 0.4%** |
|  Masco Corp. | 10384 | 480468 |
| **Capital Markets – 1.4%** | **Capital Markets – 1.4%** | **Capital Markets – 1.4%** |
|  Ameriprise Financial, Inc. | 354 | 109429 |
|  Bank of New York Mellon Corp. (The) | 15222 | 640998 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Goldman Sachs Group, Inc. (The) | 826 | $| 284565 |
|  Morgan Stanley | 9912 |  | 814469 |
|  |  |  | **1849461** |
| **Chemicals – 1.0%** | **Chemicals – 1.0%** | **Chemicals – 1.0%** | **Chemicals – 1.0%** |
|  Celanese Corp. | 236 |  | 22684 |
|  CF Industries Holdings, Inc. | 3304 |  | 351083 |
|  Dow, Inc. | 13334 |  | 623231 |
|  LyondellBasell Industries NV, Class A | 2714 |  | 207485 |
|  Mosaic Co. (The) | 1534 |  | 82453 |
|  |  |  | **1286936** |
| **Communications Equipment – 1.5%** | **Communications Equipment – 1.5%** | **Communications Equipment – 1.5%** | **Communications Equipment – 1.5%** |
|  Cisco Systems, Inc. | 42480 |  | 1929866 |
| **Consumer Finance – 2.1%** | **Consumer Finance – 2.1%** | **Consumer Finance – 2.1%** | **Consumer Finance – 2.1%** |
|  Ally Financial, Inc. | 3894 |  | 107319 |
|  American Express Co. | 2832 |  | 420410 |
|  Capital One Financial Corp. | 7434 |  | 788153 |
|  Discover Financial Services | 6844 |  | 714924 |
|  Synchrony Financial | 16402 |  | 583255 |
|  |  |  | **2614061** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  Genuine Parts Co. | 472 |  | 83950 |
|  LKQ Corp. | 1180 |  | 65655 |
|  |  |  | **149605** |
| **Diversified Financial Services – 2.6%** | **Diversified Financial Services – 2.6%** | **Diversified Financial Services – 2.6%** | **Diversified Financial Services – 2.6%** |
|  Berkshire Hathaway, Inc., Class B\* | 9676 |  | 2855291 |
|  Equitable Holdings, Inc. | 14160 |  | 433579 |
|  |  |  | **3288870** |
| **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** |
|  AT&T, Inc. | 54516 |  | 993827 |
|  Lumen Technologies, Inc.(a) | 22774 |  | 167616 |
|  Verizon Communications, Inc. | 4248 |  | 158748 |
|  |  |  | **1320191** |
| **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** |
|  Evergy, Inc. | 944 |  | 57707 |
|  Exelon Corp. | 18172 |  | 701257 |

---

*See Accompanying Notes to the Financial Statements.* 

284 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> US Quality Large Cap Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Southern Co. (The) | 18408 | $| 1205356 |
|  |  |  | **1964320** |
| **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** |
|  Emerson Electric Co. | 1416 |  | 122626 |
| **Entertainment – 1.0%** |  |  |  |
|  Activision Blizzard, Inc. | 10148 |  | 738774 |
|  Electronic Arts, Inc. | 3422 |  | 431035 |
|  Liberty Media Corp-Liberty Formula One, Class C\* | 826 |  | 47685 |
|  |  |  | **1217494** |
| **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** |
|  Host Hotels & Resorts, Inc. | 38822 |  | 732959 |
|  Iron Mountain, Inc. | 13334 |  | 667633 |
|  Mid-America Apartment Communities, Inc.(a) | 236 |  | 37158 |
|  Public Storage | 2714 |  | 840662 |
|  Regency Centers Corp. | 590 |  | 35701 |
|  Weyerhaeuser Co.(a) | 21594 |  | 667903 |
|  |  |  | **2982016** |
| **Food & Staples Retailing – 0.6%** | **Food & Staples Retailing – 0.6%** | **Food & Staples Retailing – 0.6%** | **Food & Staples Retailing – 0.6%** |
|  Kroger Co. (The) | 16166 |  | 764490 |
| **Food Products – 1.1%** |  |  |  |
|  Campbell Soup Co.(a) | 2596 |  | 137354 |
|  General Mills, Inc.(a) | 3186 |  | 259914 |
|  Hershey Co. (The) | 1534 |  | 366273 |
|  Kraft Heinz Co. (The) | 2242 |  | 86250 |
|  Tyson Foods, Inc., Class A | 8496 |  | 580702 |
|  |  |  | **1430493** |
| **Health Care Equipment & Supplies – 0.7%** | **Health Care Equipment & Supplies – 0.7%** | **Health Care Equipment & Supplies – 0.7%** | **Health Care Equipment & Supplies – 0.7%** |
|  Abbott Laboratories | 2124 |  | 210149 |
|  Hologic, Inc.\* | 5074 |  | 344017 |
|  IDEXX Laboratories, Inc.\* | 944 |  | 339538 |
|  |  |  | **893704** |
| **Health Care Providers & Services – 4.8%** | **Health Care Providers & Services – 4.8%** | **Health Care Providers & Services – 4.8%** | **Health Care Providers & Services – 4.8%** |
|  Cardinal Health, Inc. | 4956 |  | 376160 |
|  Centene Corp.\* | 354 |  | 30136 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Cigna Corp. | 2360 | $| 762422 |
|  CVS Health Corp. | 8732 |  | 826920 |
|  Elevance Health, Inc. | 590 |  | 322594 |
|  HCA Healthcare, Inc. | 1770 |  | 384922 |
|  Laboratory Corp. of America Holdings | 2714 |  | 602128 |
|  McKesson Corp. | 2596 |  | 1010805 |
|  Quest Diagnostics, Inc. | 2360 |  | 339014 |
|  UnitedHealth Group, Inc. | 2714 |  | 1506677 |
|  |  |  | **6161778** |
| **Hotels, Restaurants & Leisure – 1.2%** | **Hotels, Restaurants & Leisure – 1.2%** | **Hotels, Restaurants & Leisure – 1.2%** | **Hotels, Restaurants & Leisure – 1.2%** |
|  Airbnb, Inc., Class A\* | 3186 |  | 340615 |
|  Booking Holdings, Inc.\* | 262 |  | 489804 |
|  Carnival Corp.\* (a) | 16874 |  | 152878 |
|  DraftKings, Inc., Class A\* (a) | 9322 |  | 147288 |
|  Expedia Group, Inc.\* | 590 |  | 55147 |
|  Yum! Brands, Inc. | 3068 |  | 362791 |
|  |  |  | **1548523** |
| **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** |
|  Lennar Corp., Class A(a) | 5664 |  | 457085 |
|  NVR, Inc.\* | 41 |  | 173748 |
|  |  |  | **630833** |
| **Household Products – 1.9%** | **Household Products – 1.9%** | **Household Products – 1.9%** | **Household Products – 1.9%** |
|  Colgate-Palmolive Co. | 6844 |  | 505361 |
|  Procter & Gamble Co. (The) | 14396 |  | 1938709 |
|  |  |  | **2444070** |
| **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** |
|  AES Corp. (The)(a) | 25842 |  | 676027 |
| **Industrial Conglomerates – 0.2%** | **Industrial Conglomerates – 0.2%** | **Industrial Conglomerates – 0.2%** | **Industrial Conglomerates – 0.2%** |
|  3M Co. | 1888 |  | 237492 |
| **Insurance – 2.9%** | **Insurance – 2.9%** | **Insurance – 2.9%** | **Insurance – 2.9%** |
|  Aflac, Inc. | 11564 |  | 752932 |
|  Allstate Corp. (The) | 5664 |  | 715080 |
|  American International Group, Inc. | 14632 |  | 834024 |
|  Arch Capital Group Ltd.\* | 826 |  | 47495 |
|  MetLife, Inc. | 12626 |  | 924350 |
|  Prudential Financial, Inc. | 4248 |  | 446847 |
|  |  |  | **3720728** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 285

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> US Quality Large Cap Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Interactive Media & Services – 5.7%** | **Interactive Media & Services – 5.7%** | **Interactive Media & Services – 5.7%** |
|  Alphabet, Inc., Class A\* | 34574 | $3267589 |
|  Alphabet, Inc., Class C\* | 32922 | 3116396 |
|  Meta Platforms, Inc., Class A\* | 8024 | 747516 |
|  Pinterest, Inc., Class A\* | 2714 | 66764 |
|  |  | **7198265** |
| **Internet & Direct Marketing Retail – 2.0%** | **Internet & Direct Marketing Retail – 2.0%** | **Internet & Direct Marketing Retail – 2.0%** |
|  Amazon.com, Inc.\* | 20768 | 2127474 |
|  eBay, Inc. | 11328 | 451308 |
|  Etsy, Inc.\* (a) | 354 | 33244 |
|  |  | **2612026** |
| **IT Services – 4.5%** | **IT Services – 4.5%** | **IT Services – 4.5%** |
|  Accenture plc, Class A | 4130 | 1172507 |
|  Amdocs Ltd. | 472 | 40738 |
|  Cognizant Technology Solutions Corp., Class A | 8614 | 536222 |
|  Gartner, Inc.\* | 2124 | 641278 |
|  Jack Henry & Associates, Inc. | 2832 | 563738 |
|  Mastercard, Inc., Class A | 1534 | 503428 |
|  Paychex, Inc. | 2006 | 237330 |
|  Visa, Inc., Class A(a) | 10030 | 2077815 |
|  |  | **5773056** |
| **Life Sciences Tools & Services – 1.4%** | **Life Sciences Tools & Services – 1.4%** | **Life Sciences Tools & Services – 1.4%** |
|  Danaher Corp. | 472 | 118788 |
|  Mettler-Toledo International, Inc.\* | 562 | 710891 |
|  Thermo Fisher Scientific, Inc. | 590 | 303242 |
|  Waters Corp.\* | 2006 | 600135 |
|  |  | **1733056** |
| **Machinery – 1.6%** | **Machinery – 1.6%** | **Machinery – 1.6%** |
|  Illinois Tool Works, Inc.(a) | 5546 | 1184237 |
|  Parker-Hannifin Corp. | 2596 | 754450 |
|  Snap-on, Inc. | 236 | 52404 |
|  |  | **1991091** |
| **Media – 1.4%** | **Media – 1.4%** | **Media – 1.4%** |
|  Comcast Corp., Class A | 18408 | 584270 |
|  Interpublic Group of Cos., Inc. (The) | 21712 | 646800 |
|  Omnicom Group, Inc. | 7788 | 566577 |
|  |  | **1797647** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – 1.1%** | **Metals & Mining – 1.1%** | **Metals & Mining – 1.1%** |
|  Freeport-McMoRan, Inc. | 10974 | $347766 |
|  Nucor Corp. | 3658 | 480588 |
|  Steel Dynamics, Inc. | 5664 | 532699 |
|  |  | **1361053** |
| **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** |
|  Target Corp. | 5310 | 872167 |
| **Multi-Utilities – 1.0%** | **Multi-Utilities – 1.0%** | **Multi-Utilities – 1.0%** |
|  DTE Energy Co. | 5546 | 621762 |
|  Public Service Enterprise Group, Inc. | 11328 | 635161 |
|  |  | **1256923** |
| **Oil, Gas & Consumable Fuels – 4.0%** | **Oil, Gas & Consumable Fuels – 4.0%** | **Oil, Gas & Consumable Fuels – 4.0%** |
|  Antero Resources Corp.\* (a) | 8142 | 298486 |
|  Continental Resources, Inc.(a) | 4484 | 331682 |
|  EQT Corp. | 1770 | 74057 |
|  Exxon Mobil Corp. | 6962 | 771459 |
|  Marathon Oil Corp. | 22538 | 686282 |
|  Marathon Petroleum Corp. | 9794 | 1112794 |
|  Occidental Petroleum Corp.(a) | 16992 | 1233619 |
|  Valero Energy Corp. | 4484 | 562966 |
|  |  | **5071345** |
| **Pharmaceuticals – 6.6%** | **Pharmaceuticals – 6.6%** | **Pharmaceuticals – 6.6%** |
|  Bristol-Myers Squibb Co. | 16992 | 1316370 |
|  Eli Lilly & Co. | 5546 | 2008151 |
|  Johnson & Johnson | 18644 | 3243497 |
|  Pfizer, Inc. | 39176 | 1823643 |
|  |  | **8391661** |
| **Professional Services – 0.1%** | **Professional Services – 0.1%** | **Professional Services – 0.1%** |
|  Booz Allen Hamilton Holding Corp. | 1180 | 128443 |
| **Real Estate Management & Development – 0.5%** | **Real Estate Management & Development – 0.5%** | **Real Estate Management & Development – 0.5%** |
|  CBRE Group, Inc., Class A\* | 8260 | 585964 |
| **Road & Rail – 0.5%** | **Road & Rail – 0.5%** | **Road & Rail – 0.5%** |
|  Old Dominion Freight Line, Inc.(a) | 2242 | 615653 |
| **Semiconductors & Semiconductor Equipment – 5.3%** | **Semiconductors & Semiconductor Equipment – 5.3%** | **Semiconductors & Semiconductor Equipment – 5.3%** |
|  Advanced Micro Devices, Inc.\* | 2006 | 120480 |
|  Applied Materials, Inc. | 6490 | 573002 |

---

*See Accompanying Notes to the Financial Statements.* 

286 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> US Quality Large Cap Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  Broadcom, Inc. | 1770 | $| 832113 |
|  KLA Corp. | 1888 |  | 597458 |
|  Lam Research Corp. | 2006 |  | 811989 |
|  Microchip Technology, Inc. | 6372 |  | 393407 |
|  Micron Technology, Inc. | 2360 |  | 127676 |
|  NVIDIA Corp. | 6490 |  | 875955 |
|  QUALCOMM, Inc. | 3776 |  | 444284 |
|  Texas Instruments, Inc. | 12154 |  | 1952297 |
|  |  |  | **6728661** |
| **Software – 8.7%** | **Software – 8.7%** | **Software – 8.7%** | **Software – 8.7%** |
|  Adobe, Inc.\* | 3186 |  | 1014741 |
|  Autodesk, Inc.\* | 118 |  | 25287 |
|  Cadence Design Systems, Inc.\* | 118 |  | 17864 |
|  Check Point Software Technologies Ltd.\* | 5900 |  | 762457 |
|  Fair Isaac Corp.\* (a) | 708 |  | 339019 |
|  Fortinet, Inc.\* | 10266 |  | 586804 |
|  Intuit, Inc. | 3068 |  | 1311570 |
|  Microsoft Corp. | 21830 |  | 5067398 |
|  Oracle Corp. | 22538 |  | 1759542 |
|  Roper Technologies, Inc. | 118 |  | 48916 |
|  Zoom Video Communications, Inc., Class A\* | 1416 |  | 118151 |
|  |  |  | **11051749** |
| **Specialty Retail – 2.8%** | **Specialty Retail – 2.8%** | **Specialty Retail – 2.8%** | **Specialty Retail – 2.8%** |
|  AutoZone, Inc.\* | 354 |  | 896640 |
|  Best Buy Co., Inc. | 4130 |  | 282533 |
|  Home Depot, Inc. (The) | 3776 |  | 1118187 |
|  Lowe's Cos., Inc. | 4366 |  | 851152 |
|  O'Reilly Automotive, Inc.\* | 354 |  | 296358 |
|  Ulta Beauty, Inc.\* | 354 |  | 148457 |
|  |  |  | **3593327** |
| **Technology Hardware, Storage & Peripherals – 8.6%** | **Technology Hardware, Storage & Peripherals – 8.6%** | **Technology Hardware, Storage & Peripherals – 8.6%** | **Technology Hardware, Storage & Peripherals – 8.6%** |
|  Apple, Inc. | 67968 |  | 10422213 |
|  HP, Inc. | 14750 |  | 407395 |
|  NetApp, Inc. | 1298 |  | 89913 |
|  Seagate Technology Holdings plc | 826 |  | 41019 |
|  |  |  | **10960540** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Tobacco – 0.8%** | **Tobacco – 0.8%** | **Tobacco – 0.8%** |
|  Altria Group, Inc. | 4720 | $218394 |
|  Philip Morris International, Inc. | 8968 | 823711 |
|  |  | **1042105** |
| **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** |
|  United Rentals, Inc.\* (a) | 1180 | 372538 |
|  WW Grainger, Inc. | 784 | 458130 |
|  |  | **830668** |
| **Total Common Stocks <br>(Cost $126,865,011)** | **Total Common Stocks <br>(Cost $126,865,011)** | **125453875** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(b) – 0.2%** | **SECURITIES LENDING REINVESTMENTS(b) – 0.2%** | **SECURITIES LENDING REINVESTMENTS(b) – 0.2%** |
| **REPURCHASE AGREEMENTS – 0.2%** | **REPURCHASE AGREEMENTS – 0.2%** | **REPURCHASE AGREEMENTS – 0.2%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $264,487, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $266,344 <br>(Cost $264,465) | $264465 | 264465 |
| **Total Investments – 98.7% <br>(Cost $127,129,476)** | **Total Investments – 98.7% <br>(Cost $127,129,476)** | **125718340** |
|  Other assets less liabilities – 1.3% | Other assets less liabilities – 1.3% | 1631500 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**127349840** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $7,725,995, collateralized in the form of cash with a value of $264,465 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments and $7,671,021 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from November 15, 2022 – May 15, 2052; a total value of $7,935,486.* 

*<sup>(b)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $264,465.* 

*Percentages shown are based on Net Assets.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 287

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> US Quality Large Cap Index Fund (cont.)

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*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $9528706 |
|  Aggregate gross unrealized depreciation | (11003223) |
|  Net unrealized depreciation | $(1474517) |
|  Federal income tax cost | $127144601 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> US Quality Large Cap Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |  |
|  S&P 500 E-Mini Index | 7 | 12/16/2022 | USD | $1359050 | $(58578) |
|  S&P 500 Micro E-Mini Index | 27 | 12/16/2022 | USD | 524205 | 10322 |
|  |  |  |  |  | $(48256) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD — US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.5% |
|  Securities Lending Reinvestments | 0.2 |
|  Others<sup>(1)</sup> | 1.3 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

288 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** |
| **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** |
|  Howmet Aerospace, Inc.(a) | 5032 | $178888 |
| **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** |
|  FedEx Corp. | 2294 | 367682 |
| **Airlines – 0.1%** | **Airlines – 0.1%** | **Airlines – 0.1%** |
|  American Airlines Group, Inc.\* (a) | 2442 | 34627 |
|  Delta Air Lines, Inc.\* | 2886 | 97922 |
|  Southwest Airlines Co.\* | 1776 | 64558 |
|  |  | **197107** |
| **Auto Components – 0.1%** | **Auto Components – 0.1%** | **Auto Components – 0.1%** |
|  Aptiv plc\* | 1110 | 101088 |
| **Automobiles – 3.0%** | **Automobiles – 3.0%** | **Automobiles – 3.0%** |
|  General Motors Co. | 16428 | 644799 |
|  Tesla, Inc.\* | 19758 | 4495735 |
|  |  | **5140534** |
| **Banks – 5.2%** | **Banks – 5.2%** | **Banks – 5.2%** |
|  Bank of America Corp. | 80216 | 2890984 |
|  Citigroup, Inc. | 22052 | 1011305 |
|  Fifth Third Bancorp | 5994 | 213926 |
|  Huntington Bancshares, Inc.(a) | 16946 | 257240 |
|  JPMorgan Chase & Co. | 33152 | 4173174 |
|  KeyCorp | 9694 | 173232 |
|  Regions Financial Corp. | 6660 | 146187 |
|  |  | **8866048** |
| **Beverages – 0.6%** | **Beverages – 0.6%** | **Beverages – 0.6%** |
|  Coca-Cola Co. (The) | 15022 | 899067 |
|  Keurig Dr Pepper, Inc.(a) | 3182 | 123589 |
|  |  | **1022656** |
| **Biotechnology – 2.1%** | **Biotechnology – 2.1%** | **Biotechnology – 2.1%** |
|  AbbVie, Inc. | 6734 | 985858 |
|  Amgen, Inc. | 3034 | 820242 |
|  Biogen, Inc.\* | 592 | 167796 |
|  Gilead Sciences, Inc. | 6882 | 539962 |
|  Regeneron Pharmaceuticals, Inc.\* | 444 | 332445 |
|  Vertex Pharmaceuticals, Inc.\* | 2442 | 761904 |
|  |  | **3608207** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Building Products – 0.3%** | **Building Products – 0.3%** | **Building Products – 0.3%** |
|  Allegion plc | 148 | $15506 |
|  Johnson Controls International plc | 2442 | 141245 |
|  Trane Technologies plc | 2664 | 425255 |
|  |  | **582006** |
| **Capital Markets – 3.6%** | **Capital Markets – 3.6%** | **Capital Markets – 3.6%** |
|  Bank of New York Mellon Corp. (The) | 7104 | 299150 |
|  BlackRock, Inc. | 1702 | 1099339 |
|  Blackstone, Inc., Class A | 2516 | 229308 |
|  Goldman Sachs Group, Inc. (The) | 3922 | 1351168 |
|  Moody's Corp. | 1554 | 411608 |
|  Morgan Stanley | 12876 | 1058021 |
|  MSCI, Inc. | 740 | 346956 |
|  Nasdaq, Inc. | 3922 | 244105 |
|  S&P Global, Inc. | 3108 | 998445 |
|  State Street Corp. | 2590 | 191660 |
|  |  | **6229760** |
| **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** |
|  Air Products and Chemicals, Inc. | 1258 | 315003 |
|  DuPont de Nemours, Inc.(a) | 3996 | 228571 |
|  Eastman Chemical Co. | 296 | 22736 |
|  Ecolab, Inc. | 2220 | 348696 |
|  PPG Industries, Inc. | 1850 | 211233 |
|  Sherwin-Williams Co. (The) | 1776 | 399653 |
|  |  | **1525892** |
| **Commercial Services & Supplies – 0.3%** | **Commercial Services & Supplies – 0.3%** | **Commercial Services & Supplies – 0.3%** |
|  Cintas Corp. | 962 | 411303 |
|  Republic Services, Inc. | 888 | 117767 |
|  |  | **529070** |
| **Communications Equipment – 1.0%** | **Communications Equipment – 1.0%** | **Communications Equipment – 1.0%** |
|  Cisco Systems, Inc. | 38998 | 1771679 |
| **Consumer Finance – 0.2%** | **Consumer Finance – 0.2%** | **Consumer Finance – 0.2%** |
|  Capital One Financial Corp. | 3700 | 392274 |
| **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** |
|  Amcor plc | 15540 | 179953 |
|  Ball Corp.(a) | 3626 | 179088 |
|  Westrock Co. | 2664 | 90736 |
|  |  | **449777** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 289

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  LKQ Corp. | 1702 | $94699 |
| **Diversified Financial Services – 2.7%** | **Diversified Financial Services – 2.7%** | **Diversified Financial Services – 2.7%** |
|  Apollo Global Management, Inc.(a) | 5180 | 286765 |
|  Berkshire Hathaway, Inc., Class B\* | 14504 | 4279985 |
|  |  | **4566750** |
| **Diversified Telecommunication Services – 0.9%** | **Diversified Telecommunication Services – 0.9%** | **Diversified Telecommunication Services – 0.9%** |
|  Lumen Technologies, Inc.(a) | 1702 | 12527 |
|  Verizon Communications, Inc. | 39812 | 1487774 |
|  |  | **1500301** |
| **Electric Utilities – 0.1%** | **Electric Utilities – 0.1%** | **Electric Utilities – 0.1%** |
|  Entergy Corp. | 1110 | 118925 |
|  Evergy, Inc. | 1184 | 72378 |
|  |  | **191303** |
| **Electrical Equipment – 0.6%** | **Electrical Equipment – 0.6%** | **Electrical Equipment – 0.6%** |
|  Eaton Corp. plc | 3848 | 577470 |
|  Emerson Electric Co. | 3182 | 275561 |
|  Rockwell Automation, Inc.(a) | 814 | 207814 |
|  |  | **1060845** |
| **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** |
|  Amphenol Corp., Class A | 4292 | 325463 |
|  Corning, Inc.(a) | 5994 | 192827 |
|  Keysight Technologies, Inc.\* | 1406 | 244855 |
|  TE Connectivity Ltd. | 1110 | 135675 |
|  |  | **898820** |
| **Energy Equipment & Services – 0.7%** | **Energy Equipment & Services – 0.7%** | **Energy Equipment & Services – 0.7%** |
|  Baker Hughes Co.(a) | 7696 | 212871 |
|  Halliburton Co. | 3478 | 126669 |
|  Schlumberger NV | 15836 | 823947 |
|  |  | **1163487** |
| **Entertainment – 1.2%** | **Entertainment – 1.2%** | **Entertainment – 1.2%** |
|  Activision Blizzard, Inc. | 2664 | 193939 |
|  Walt Disney Co. (The)\* | 17242 | 1836963 |
|  |  | **2030902** |
| **Equity Real Estate Investment Trusts (REITs) – 1.6%** | **Equity Real Estate Investment Trusts (REITs) – 1.6%** | **Equity Real Estate Investment Trusts (REITs) – 1.6%** |
|  Alexandria Real Estate Equities, Inc. | 592 | 86018 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  AvalonBay Communities, Inc. | 1554 | $| 272136 |
|  Boston Properties, Inc. | 1406 |  | 102216 |
|  Camden Property Trust | 666 |  | 76956 |
|  Digital Realty Trust, Inc. | 1110 |  | 111278 |
|  Equity Residential | 1924 |  | 121250 |
|  Essex Property Trust, Inc. | 370 |  | 82229 |
|  Healthpeak Properties, Inc. | 6438 |  | 152774 |
|  Host Hotels & Resorts, Inc. | 4144 |  | 78239 |
|  Iron Mountain, Inc. | 2146 |  | 107450 |
|  Kimco Realty Corp.(a) | 3848 |  | 82270 |
|  Prologis, Inc. | 2886 |  | 319625 |
|  Realty Income Corp.(a) | 6882 |  | 428542 |
|  Simon Property Group, Inc. | 1110 |  | 120968 |
|  Sun Communities, Inc. | 962 |  | 129726 |
|  Ventas, Inc. | 3848 |  | 150572 |
|  Welltower, Inc.(a) | 5180 |  | 316187 |
|  |  |  | **2738436** |
| **Food & Staples Retailing – 1.5%** | **Food & Staples Retailing – 1.5%** | **Food & Staples Retailing – 1.5%** | **Food & Staples Retailing – 1.5%** |
|  Kroger Co. (The) | 3404 |  | 160975 |
|  Walgreens Boots Alliance, Inc. | 2220 |  | 81030 |
|  Walmart, Inc. | 16428 |  | 2338197 |
|  |  |  | **2580202** |
| **Food Products – 0.3%** | **Food Products – 0.3%** | **Food Products – 0.3%** | **Food Products – 0.3%** |
|  Bunge Ltd. | 444 |  | 43823 |
|  Darling Ingredients, Inc.\* | 814 |  | 63883 |
|  General Mills, Inc. | 2442 |  | 199218 |
|  Hershey Co. (The) | 518 |  | 123683 |
|  Kellogg Co. | 1406 |  | 108009 |
|  |  |  | **538616** |
| **Health Care Equipment & Supplies – 2.6%** | **Health Care Equipment & Supplies – 2.6%** | **Health Care Equipment & Supplies – 2.6%** | **Health Care Equipment & Supplies – 2.6%** |
|  Baxter International, Inc. | 3848 |  | 209139 |
|  Becton Dickinson and Co. | 2146 |  | 506392 |
|  Boston Scientific Corp.\* | 10730 |  | 462570 |
|  Cooper Cos., Inc. (The) | 296 |  | 80923 |
|  Dexcom, Inc.\* | 2368 |  | 286007 |
|  Edwards Lifesciences Corp.\* | 5846 |  | 423426 |
|  Hologic, Inc.\* | 2146 |  | 145499 |
|  Intuitive Surgical, Inc.\* | 3404 |  | 838984 |
|  Medtronic plc | 4810 |  | 420105 |
|  Stryker Corp. | 3848 |  | 882115 |

---

*See Accompanying Notes to the Financial Statements.* 

290 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Zimmer Biomet Holdings, Inc. | 1628 | $| 184534 |
|  |  |  | **4439694** |
| **Health Care Providers & Services – 3.7%** | **Health Care Providers & Services – 3.7%** | **Health Care Providers & Services – 3.7%** | **Health Care Providers & Services – 3.7%** |
|  Cigna Corp. | 1184 |  | 382503 |
|  Elevance Health, Inc. | 2738 |  | 1497056 |
|  Humana, Inc. | 740 |  | 412979 |
|  Quest Diagnostics, Inc. | 666 |  | 95671 |
|  UnitedHealth Group, Inc. | 7030 |  | 3902705 |
|  |  |  | **6290914** |
| **Hotels, Restaurants & Leisure – 2.7%** | **Hotels, Restaurants & Leisure – 2.7%** | **Hotels, Restaurants & Leisure – 2.7%** | **Hotels, Restaurants & Leisure – 2.7%** |
|  Booking Holdings, Inc.\* | 370 |  | 691708 |
|  Caesars Entertainment, Inc.\* | 1480 |  | 64720 |
|  Carnival Corp.\* (a) | 7104 |  | 64362 |
|  Chipotle Mexican Grill, Inc.\* | 222 |  | 332629 |
|  Domino's Pizza, Inc. | 370 |  | 122929 |
|  Hilton Worldwide Holdings, Inc. | 2590 |  | 350323 |
|  Las Vegas Sands Corp.\* (a) | 1924 |  | 73131 |
|  Marriott International, Inc., Class A | 2738 |  | 438381 |
|  McDonald's Corp. | 4144 |  | 1129903 |
|  MGM Resorts International | 2738 |  | 97391 |
|  Royal Caribbean Cruises Ltd.\* (a) | 962 |  | 51352 |
|  Starbucks Corp. | 8510 |  | 736881 |
|  Yum China Holdings, Inc. | 3182 |  | 131576 |
|  Yum! Brands, Inc. | 2664 |  | 315018 |
|  |  |  | **4600304** |
| **Household Durables – 0.0%(b)** | **Household Durables – 0.0%(b)** | **Household Durables – 0.0%(b)** | **Household Durables – 0.0%(b)** |
|  Whirlpool Corp.(a) | 296 |  | 40919 |
| **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** |
|  Clorox Co. (The)(a) | 370 |  | 54035 |
|  Colgate-Palmolive Co. | 2960 |  | 218566 |
|  Kimberly-Clark Corp. | 1258 |  | 156571 |
|  |  |  | **429172** |
| **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** |
|  3M Co. | 5254 |  | 660901 |
|  General Electric Co. | 12506 |  | 973092 |
|  |  |  | **1633993** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Insurance – 2.3%** | **Insurance – 2.3%** | **Insurance – 2.3%** |
|  Aflac, Inc. | 6734 | $438451 |
|  American International Group, Inc. | 4662 | 265734 |
|  Aon plc, Class A | 1480 | 416605 |
|  Arch Capital Group Ltd.\* | 1924 | 110630 |
|  Chubb Ltd. | 2294 | 492958 |
|  Hartford Financial Services Group, Inc. (The) | 2220 | 160750 |
|  Marsh & McLennan Cos., Inc. | 3774 | 609463 |
|  MetLife, Inc. | 6586 | 482161 |
|  Principal Financial Group, Inc.(a) | 2886 | 254343 |
|  Progressive Corp. (The) | 4292 | 551093 |
|  Willis Towers Watson plc | 1036 | 226066 |
|  |  | **4008254** |
| **Interactive Media & Services – 3.4%** | **Interactive Media & Services – 3.4%** | **Interactive Media & Services – 3.4%** |
|  Alphabet, Inc., Class C\* | 35520 | 3362323 |
|  Meta Platforms, Inc., Class A\* | 25752 | 2399056 |
|  Snap, Inc., Class A\* | 10878 | 107801 |
|  |  | **5869180** |
| **Internet & Direct Marketing Retail – 4.2%** | **Internet & Direct Marketing Retail – 4.2%** | **Internet & Direct Marketing Retail – 4.2%** |
|  Amazon.com, Inc.\* | 67636 | 6928632 |
|  eBay, Inc. | 5402 | 215215 |
|  Etsy, Inc.\* (a) | 1480 | 138987 |
|  |  | **7282834** |
| **IT Services – 4.9%** | **IT Services – 4.9%** | **IT Services – 4.9%** |
|  Accenture plc, Class A | 7548 | 2142877 |
|  Automatic Data Processing, Inc. | 4736 | 1144691 |
|  Block, Inc., Class A\* | 1776 | 106684 |
|  Broadridge Financial Solutions, Inc. | 444 | 66627 |
|  Cognizant Technology Solutions Corp., Class A | 5994 | 373127 |
|  Gartner, Inc.\* | 740 | 223421 |
|  International Business Machines Corp. | 10212 | 1412217 |
|  Mastercard, Inc., Class A | 6364 | 2088538 |
|  PayPal Holdings, Inc.\* | 10730 | 896813 |
|  |  | **8454995** |
| **Leisure Products – 0.0%(b)** | **Leisure Products – 0.0%(b)** | **Leisure Products – 0.0%(b)** |
|  Hasbro, Inc. | 1036 | 67599 |
| **Life Sciences Tools & Services – 1.9%** | **Life Sciences Tools & Services – 1.9%** | **Life Sciences Tools & Services – 1.9%** |
|  Agilent Technologies, Inc. | 1776 | 245709 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 291

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** |
| **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** |
|  Avantor, Inc.\* | 2812 | $| 56718 |
|  Bio-Rad Laboratories, Inc., Class A\* | 148 |  | 52053 |
|  Charles River Laboratories International, Inc.\* | 222 |  | 47119 |
|  Danaher Corp. | 5106 |  | 1285027 |
|  Illumina, Inc.\* (a) | 1110 |  | 253990 |
|  IQVIA Holdings, Inc.\* | 740 |  | 155156 |
|  Mettler-Toledo International, Inc.\* | 148 |  | 187210 |
|  PerkinElmer, Inc. | 740 |  | 98849 |
|  Thermo Fisher Scientific, Inc. | 1480 |  | 760676 |
|  Waters Corp.\* | 222 |  | 66416 |
|  West Pharmaceutical Services, Inc. | 370 |  | 85137 |
|  |  |  | **3294060** |
| **Machinery – 1.9%** | **Machinery – 1.9%** | **Machinery – 1.9%** | **Machinery – 1.9%** |
|  Caterpillar, Inc. | 3996 |  | 864974 |
|  Cummins, Inc. | 1332 |  | 325687 |
|  Deere & Co. | 2294 |  | 908011 |
|  Dover Corp. | 444 |  | 58027 |
|  Fortive Corp. | 3478 |  | 222244 |
|  Ingersoll Rand, Inc. | 2516 |  | 127058 |
|  Otis Worldwide Corp. | 4070 |  | 287505 |
|  Parker-Hannifin Corp.(a) | 666 |  | 193553 |
|  Stanley Black & Decker, Inc. | 1776 |  | 139398 |
|  Xylem, Inc. | 1406 |  | 144017 |
|  |  |  | **3270474** |
| **Media – 0.6%** | **Media – 0.6%** | **Media – 0.6%** | **Media – 0.6%** |
|  Comcast Corp., Class A | 25160 |  | 798578 |
|  Interpublic Group of Cos., Inc. (The) | 3848 |  | 114632 |
|  Omnicom Group, Inc.(a) | 1998 |  | 145355 |
|  Paramount Global, Class B(a) | 3034 |  | 55583 |
|  |  |  | **1114148** |
| **Metals & Mining – 0.6%** | **Metals & Mining – 0.6%** | **Metals & Mining – 0.6%** | **Metals & Mining – 0.6%** |
|  Alcoa Corp. | 296 |  | 11553 |
|  Freeport-McMoRan, Inc. | 11100 |  | 351759 |
|  Newmont Corp. | 7548 |  | 319431 |
|  Nucor Corp. | 2072 |  | 272220 |
|  |  |  | **954963** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.0%(b)** | **Mortgage Real Estate Investment Trusts (REITs) – 0.0%(b)** | **Mortgage Real Estate Investment Trusts (REITs) – 0.0%(b)** |
|  Annaly Capital Management, Inc. | 1628 | $30199 |
| **Multiline Retail – 0.4%** | **Multiline Retail – 0.4%** | **Multiline Retail – 0.4%** |
|  Dollar Tree, Inc.\* (a) | 1258 | 199393 |
|  Target Corp. | 3404 | 559107 |
|  |  | **758500** |
| **Multi-Utilities – 0.2%** | **Multi-Utilities – 0.2%** | **Multi-Utilities – 0.2%** |
|  CMS Energy Corp. | 1554 | 88656 |
|  Sempra Energy | 1258 | 189882 |
|  |  | **278538** |
| **Oil, Gas & Consumable Fuels – 7.1%** | **Oil, Gas & Consumable Fuels – 7.1%** | **Oil, Gas & Consumable Fuels – 7.1%** |
|  APA Corp. | 2442 | 111013 |
|  Chesapeake Energy Corp. | 444 | 45408 |
|  Chevron Corp.(a) | 20350 | 3681315 |
|  ConocoPhillips | 7400 | 933066 |
|  Devon Energy Corp. | 3626 | 280471 |
|  Diamondback Energy, Inc.(a) | 962 | 151140 |
|  EOG Resources, Inc. | 2294 | 313177 |
|  EQT Corp. | 1406 | 58827 |
|  Exxon Mobil Corp. | 46916 | 5198762 |
|  Hess Corp. | 962 | 135719 |
|  Occidental Petroleum Corp.(a) | 2812 | 204151 |
|  Ovintiv, Inc. | 1406 | 71214 |
|  Phillips 66(a) | 5476 | 571092 |
|  Valero Energy Corp.(a) | 2960 | 371628 |
|  |  | **12126983** |
| **Personal Products – 0.3%** | **Personal Products – 0.3%** | **Personal Products – 0.3%** |
|  Estee Lauder Cos., Inc. (The), Class A | 2220 | 445088 |
| **Pharmaceuticals – 8.5%** | **Pharmaceuticals – 8.5%** | **Pharmaceuticals – 8.5%** |
|  Bristol-Myers Squibb Co. | 20128 | 1559316 |
|  Eli Lilly & Co. | 7178 | 2599082 |
|  Johnson & Johnson | 29600 | 5149512 |
|  Merck & Co., Inc. | 28490 | 2883188 |
|  Pfizer, Inc. | 52466 | 2442292 |
|  |  | **14633390** |
| **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** |
|  Booz Allen Hamilton Holding Corp. | 1480 | 161098 |
|  Verisk Analytics, Inc. | 1776 | 324706 |
|  |  | **485804** |

---

*See Accompanying Notes to the Financial Statements.* 

292 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** | **COMMON STOCKS — (continued)** |
| **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** |
|  CBRE Group, Inc., Class A\* | 3626 | $257228 |
| **Road & Rail – 0.9%** | **Road & Rail – 0.9%** | **Road & Rail – 0.9%** |
|  JB Hunt Transport Services, Inc. | 296 | 50637 |
|  Uber Technologies, Inc.\* | 18574 | 493511 |
|  Union Pacific Corp. | 4662 | 919067 |
|  |  | **1463215** |
| **Semiconductors & Semiconductor Equipment – 5.1%** | **Semiconductors & Semiconductor Equipment – 5.1%** | **Semiconductors & Semiconductor Equipment – 5.1%** |
|  Advanced Micro Devices, Inc.\* | 8954 | 537777 |
|  Analog Devices, Inc. | 3996 | 569910 |
|  Applied Materials, Inc. | 8362 | 738281 |
|  Intel Corp. | 38998 | 1108713 |
|  Lam Research Corp. | 1258 | 509213 |
|  Microchip Technology, Inc. | 3922 | 242144 |
|  Micron Technology, Inc. | 10508 | 568483 |
|  NVIDIA Corp. | 13986 | 1887691 |
|  Qorvo, Inc.\* | 592 | 50959 |
|  QUALCOMM, Inc. | 8510 | 1001287 |
|  Skyworks Solutions, Inc. | 1036 | 89106 |
|  Teradyne, Inc. | 444 | 36119 |
|  Texas Instruments, Inc. | 8584 | 1378848 |
|  Wolfspeed, Inc.\* (a) | 518 | 40793 |
|  |  | **8759324** |
| **Software – 8.5%** | **Software – 8.5%** | **Software – 8.5%** |
|  Adobe, Inc.\* | 4440 | 1414140 |
|  Autodesk, Inc.\* | 2442 | 523321 |
|  Cadence Design Systems, Inc.\* | 1110 | 168043 |
|  Check Point Software Technologies Ltd.\* | 370 | 47815 |
|  Crowdstrike Holdings, Inc., Class A\* | 1258 | 202790 |
|  DocuSign, Inc.\* | 1998 | 96503 |
|  Fortinet, Inc.\* | 6216 | 355307 |
|  Intuit, Inc. | 2146 | 917415 |
|  Microsoft Corp. | 33966 | 7884528 |
|  NortonLifeLock, Inc. | 2146 | 48349 |
|  Oracle Corp. | 8806 | 687484 |
|  Palo Alto Networks, Inc.\* | 2146 | 368232 |
|  Salesforce, Inc.\* | 5550 | 902375 |
|  ServiceNow, Inc.\* | 1110 | 467021 |
|  Splunk, Inc.\* | 1184 | 98402 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Synopsys, Inc.\* | 1184 | $| 346379 |
|  Zendesk, Inc.\* | 962 |  | 73776 |
|  |  |  | **14601880** |
| **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** |
|  AutoZone, Inc.\* | 148 |  | 374866 |
|  Best Buy Co., Inc. | 2368 |  | 161995 |
|  Home Depot, Inc. (The) | 5846 |  | 1731176 |
|  Lowe's Cos., Inc. | 4736 |  | 923283 |
|  Ross Stores, Inc. | 3330 |  | 318648 |
|  TJX Cos., Inc. (The) | 13246 |  | 955036 |
|  Tractor Supply Co. | 1258 |  | 276471 |
|  Ulta Beauty, Inc.\* | 296 |  | 124133 |
|  Williams-Sonoma, Inc. | 814 |  | 100798 |
|  |  |  | **4966406** |
| **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** |
|  Apple, Inc. | 56980 |  | 8737313 |
|  Dell Technologies, Inc., Class C | 1110 |  | 42624 |
|  Hewlett Packard Enterprise Co. | 15984 |  | 228092 |
|  HP, Inc. | 10360 |  | 286143 |
|  NetApp, Inc. | 1850 |  | 128149 |
|  Seagate Technology Holdings plc | 592 |  | 29399 |
|  Western Digital Corp.\* (a) | 3108 |  | 106822 |
|  |  |  | **9558542** |
| **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** | **Textiles, Apparel & Luxury Goods – 0.8%** |
|  Lululemon Athletica, Inc.\* (a) | 1406 |  | 462630 |
|  NIKE, Inc., Class B | 9546 |  | 884724 |
|  VF Corp. | 3848 |  | 108706 |
|  |  |  | **1456060** |
| **Tobacco – 0.2%** | **Tobacco – 0.2%** | **Tobacco – 0.2%** | **Tobacco – 0.2%** |
|  Altria Group, Inc. | 6808 |  | 315006 |
| **Trading Companies & Distributors – 0.2%** | **Trading Companies & Distributors – 0.2%** | **Trading Companies & Distributors – 0.2%** | **Trading Companies & Distributors – 0.2%** |
|  United Rentals, Inc.\* (a) | 370 |  | 116813 |
|  WW Grainger, Inc. | 296 |  | 172967 |
|  |  |  | **289780** |
| **Water Utilities – 0.1%** | **Water Utilities – 0.1%** | **Water Utilities – 0.1%** | **Water Utilities – 0.1%** |
|  American Water Works Co., Inc. | 1702 |  | 247369 |
| **Total Common Stocks <br>(Cost $169,811,069)** | **Total Common Stocks <br>(Cost $169,811,069)** |  | **170751844** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 293

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SECURITIES LENDING REINVESTMENTS(c) – 0.1%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.1%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.1%** |
| **REPURCHASE AGREEMENTS – 0.1%** | **REPURCHASE AGREEMENTS – 0.1%** | **REPURCHASE AGREEMENTS – 0.1%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $225,712, collateralized by various U.S. Treasury Securities, ranging from 0.75% –5.50%, maturing 7/15/2028 –1/15/2029; total market value $227,296 <br>(Cost $225,693) | $225693 | $225693 |
| **Total Investments – 99.4% <br>(Cost $170,036,762)** | **Total Investments – 99.4% <br>(Cost $170,036,762)** | **170977537** |
|  Other assets less liabilities – 0.6% | Other assets less liabilities – 0.6% | 1002389 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**171979926** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $9,174,813, collateralized in the form of cash with a value of* 

 *$225,693 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $9,139,258 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 15, 2022 – May 15, 2052 and $2,503 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from July 15, 2023 – June 30, 2120; a total value of $9,367,454.* 

*<sup>(b)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $225,693.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $20039041 |
|  Aggregate gross unrealized depreciation | (19109350) |
|  Net unrealized appreciation | $929691 |
|  Federal income tax cost | $170011778 |

---

*Investment in a company which was affiliated for the period ended October 31, 2022, was as follows:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Security | Value<br>October 31,<br>2021 | Purchases<br>at Cost | Sales<br>Proceeds | Shares<br>October 31,<br>2022 | Dividend<br>Income | Realized<br>Loss |
|  Northern Trust Corp. | $– $| 129215 | $104816 | – $– $– $| 1575 | $(24399) |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading <br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |  |
|  S&P 500 E-Mini Index | 6 | 12/16/2022 | USD | $1164900 | $(36068) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

294 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (cont.)

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---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.3% |
|  Securities Lending Reinvestments | 0.1 |
|  Others<sup>(1)</sup> | 0.6 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 295

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** |
| **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** |
|  Howmet Aerospace, Inc. | 1850 | $65767 |
|  Kongsberg Gruppen ASA | 300 | 10751 |
|  MTU Aero Engines AG | 175 | 31349 |
|  QinetiQ Group plc | 2350 | 9724 |
|  Rheinmetall AG | 200 | 32517 |
|  Saab AB, Class B | 375 | 13242 |
|  Singapore Technologies Engineering Ltd. | 17500 | 40810 |
|  |  | **204160** |
| **Air Freight & Logistics – 0.3%** | **Air Freight & Logistics – 0.3%** | **Air Freight & Logistics – 0.3%** |
|  Deutsche Post AG (Registered) | 3300 | 117122 |
|  DSV A/S | 950 | 128642 |
|  FedEx Corp.(a) | 725 | 116203 |
|  International Distributions Services plc | 3375 | 7861 |
|  |  | **369828** |
| **Airlines – 0.1%** | **Airlines – 0.1%** | **Airlines – 0.1%** |
|  ANA Holdings, Inc.\* | 2500 | 48626 |
|  International Consolidated Airlines Group SA\* (a) | 17750 | 24843 |
|  Qantas Airways Ltd.\* | 13750 | 51348 |
|  Singapore Airlines Ltd.\* | 5000 | 18585 |
|  |  | **143402** |
| **Auto Components – 0.3%** | **Auto Components – 0.3%** | **Auto Components – 0.3%** |
|  Bridgestone Corp. | 5000 | 180375 |
|  Cie Generale des Etablissements Michelin SCA | 5050 | 128822 |
|  Continental AG | 275 | 14264 |
|  Denso Corp. | 2500 | 124298 |
|  Faurecia SE\* | 600 | 8966 |
|  Sumitomo Electric Industries Ltd. | 2500 | 26138 |
|  Valeo | 1025 | 16908 |
|  |  | **499771** |
| **Automobiles – 1.9%** | **Automobiles – 1.9%** | **Automobiles – 1.9%** |
|  Bayerische Motoren Werke AG | 2375 | 186660 |
|  Ferrari NV | 550 | 108447 |
|  General Motors Co. | 10700 | 419975 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** |
|  Honda Motor Co. Ltd. | 10000 | $| 226932 |
|  Isuzu Motors Ltd. | 2500 |  | 29333 |
|  Mazda Motor Corp. | 2500 |  | 16870 |
|  Mercedes-Benz Group AG | 5550 |  | 321441 |
|  Mitsubishi Motors Corp.\* | 5000 |  | 16820 |
|  Nissan Motor Co. Ltd. | 15000 |  | 47876 |
|  Renault SA\* | 1150 |  | 35428 |
|  Stellantis NV | 13275 |  | 179224 |
|  Subaru Corp. | 2500 |  | 38946 |
|  Suzuki Motor Corp. | 2500 |  | 84435 |
|  Toyota Motor Corp. | 57500 |  | 796725 |
|  Volkswagen AG (Preference) | 1225 |  | 156596 |
|  Yamaha Motor Co. Ltd. | 2500 |  | 51636 |
|  |  |  | **2717344** |
| **Banks – 8.4%** | **Banks – 8.4%** | **Banks – 8.4%** | **Banks – 8.4%** |
|  Australia & New Zealand Banking Group Ltd. | 18275 |  | 298693 |
|  Banco Bilbao Vizcaya Argentaria SA(a) | 35625 |  | 183409 |
|  Banco BPM SpA | 10575 |  | 31993 |
|  Banco de Sabadell SA | 23675 |  | 18616 |
|  Banco Santander SA(a) | 118800 |  | 307865 |
|  Bank of America Corp. | 31525 |  | 1136161 |
|  Bank of Ireland Group plc | 7000 |  | 50477 |
|  Bank of Montreal | 3200 |  | 294394 |
|  Bank of Nova Scotia (The) | 4350 |  | 209998 |
|  Bankinter SA(a) | 4350 |  | 26295 |
|  Barclays plc | 70000 |  | 119086 |
|  BAWAG Group AG\* (b) | 550 |  | 26593 |
|  CaixaBank SA | 13050 |  | 43247 |
|  Canadian Imperial Bank of Commerce | 5525 |  | 250601 |
|  Citigroup, Inc. | 14375 |  | 659237 |
|  Commerzbank AG\* | 3575 |  | 28606 |
|  Commonwealth Bank of Australia(a) | 11825 |  | 791537 |
|  Danske Bank A/S | 4225 |  | 68205 |
|  DBS Group Holdings Ltd. | 7500 |  | 181259 |
|  Fifth Third Bancorp | 2150 |  | 76733 |
|  Hang Seng Bank Ltd. | 5000 |  | 70383 |
|  HSBC Holdings plc | 108750 |  | 560061 |

---

*See Accompanying Notes to the Financial Statements.* 

296 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Huntington Bancshares, Inc.(a) | 6650 | $| 100947 |
|  ING Groep NV | 9650 |  | 94937 |
|  Intesa Sanpaolo SpA | 130175 |  | 248182 |
|  JPMorgan Chase & Co. | 25925 |  | 3263439 |
|  KBC Group NV | 925 |  | 46351 |
|  KeyCorp | 3075 |  | 54950 |
|  Lloyds Banking Group plc | 377775 |  | 182767 |
|  Mediobanca Banca di Credito Finanziario SpA | 4375 |  | 39660 |
|  Mitsubishi UFJ Financial Group, Inc. | 82500 |  | 388258 |
|  National Australia Bank Ltd. | 7625 |  | 158074 |
|  National Bank of Canada | 825 |  | 56103 |
|  NatWest Group plc | 25825 |  | 69815 |
|  Nordea Bank Abp | 23650 |  | 226171 |
|  Oversea-Chinese Banking Corp. Ltd. | 20000 |  | 171437 |
|  Royal Bank of Canada | 6625 |  | 612207 |
|  Skandinaviska Enskilda Banken AB, Class A | 10575 |  | 111488 |
|  Societe Generale SA | 5650 |  | 129693 |
|  Standard Chartered plc | 11400 |  | 68278 |
|  Svenska Handelsbanken AB, Class A | 11200 |  | 104039 |
|  Swedbank AB, Class A | 4825 |  | 71892 |
|  Toronto-Dominion Bank (The) | 6400 |  | 409088 |
|  Virgin Money UK plc | 7550 |  | 11831 |
|  Westpac Banking Corp. | 20275 |  | 312582 |
|  |  |  | **12365638** |
| **Beverages – 1.6%** | **Beverages – 1.6%** | **Beverages – 1.6%** | **Beverages – 1.6%** |
|  Anheuser-Busch InBev SA/NV | 4325 |  | 216295 |
|  Britvic plc | 2425 |  | 20312 |
|  Budweiser Brewing Co. APAC Ltd.(b) | 7500 |  | 15784 |
|  Carlsberg A/S, Class B | 375 |  | 44208 |
|  Coca-Cola Co. (The) | 17200 |  | 1029420 |
|  Coca-Cola HBC AG | 800 |  | 17524 |
|  Davide Campari-Milano NV | 1475 |  | 13257 |
|  Diageo plc | 10250 |  | 424612 |
|  Heineken Holding NV | 500 |  | 34147 |
|  Heineken NV | 1225 |  | 102428 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** | **Beverages – (continued)** |
|  Keurig Dr Pepper, Inc. | 3725 | $| 144679 |
|  Kirin Holdings Co. Ltd. | 2500 |  | 36827 |
|  Pernod Ricard SA | 1325 |  | 232709 |
|  Remy Cointreau SA | 125 |  | 19162 |
|  Royal Unibrew A/S | 125 |  | 7141 |
|  |  |  | **2358505** |
| **Biotechnology – 0.5%** | **Biotechnology – 0.5%** | **Biotechnology – 0.5%** | **Biotechnology – 0.5%** |
|  Gilead Sciences, Inc. | 3675 |  | 288340 |
|  Grifols SA\* (a) | 625 |  | 5316 |
|  Swedish Orphan Biovitrum AB\* | 1350 |  | 24837 |
|  Vertex Pharmaceuticals, Inc.\* | 1500 |  | 468000 |
|  |  |  | **786493** |
| **Building Products – 0.5%** | **Building Products – 0.5%** | **Building Products – 0.5%** | **Building Products – 0.5%** |
|  AGC, Inc. | 2500 |  | 78464 |
|  Assa Abloy AB, Class B | 7300 |  | 147315 |
|  Belimo Holding AG (Registered) | 50 |  | 20385 |
|  Cie de Saint-Gobain | 2425 |  | 99225 |
|  Daikin Industries Ltd. | 1100 |  | 165664 |
|  Fletcher Building Ltd. | 3425 |  | 10227 |
|  Lixil Corp. | 2500 |  | 37861 |
|  Nibe Industrier AB, Class B(a) | 3550 |  | 28303 |
|  Reliance Worldwide Corp. Ltd.(a) | 5025 |  | 10315 |
|  ROCKWOOL A/S, Class B | 75 |  | 14935 |
|  Trane Technologies plc | 900 |  | 143667 |
|  |  |  | **756361** |
| **Capital Markets – 2.3%** | **Capital Markets – 2.3%** | **Capital Markets – 2.3%** | **Capital Markets – 2.3%** |
|  3i Group plc | 1350 |  | 18038 |
|  abrdn plc | 7000 |  | 12815 |
|  Allfunds Group plc | 2025 |  | 12779 |
|  BlackRock, Inc. | 1075 |  | 694353 |
|  Credit Suisse Group AG (Registered) | 9225 |  | 38071 |
|  Daiwa Securities Group, Inc. | 17500 |  | 68288 |
|  Deutsche Boerse AG | 400 |  | 65093 |
|  Euronext NV(b) | 450 |  | 28598 |
|  Goldman Sachs Group, Inc. (The) | 2000 |  | 689020 |
|  Hong Kong Exchanges & Clearing Ltd. | 7500 |  | 199685 |
|  IG Group Holdings plc | 1300 |  | 11907 |
|  Intermediate Capital Group plc | 200 |  | 2445 |
|  Julius Baer Group Ltd. | 1100 |  | 52727 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 297

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  London Stock Exchange Group plc | 1900 | $| 165511 |
|  Macquarie Group Ltd. | 2600 |  | 281806 |
|  Man Group plc | 2625 |  | 6549 |
|  Morgan Stanley | 4000 |  | 328680 |
|  MSCI, Inc. | 225 |  | 105493 |
|  Nasdaq, Inc. | 1475 |  | 91804 |
|  S&P Global, Inc. | 1075 |  | 345344 |
|  St James's Place plc | 2475 |  | 30348 |
|  UBS Group AG (Registered) | 11175 |  | 177438 |
|  |  |  | **3426792** |
| **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** |
|  Air Liquide SA | 1750 |  | 228828 |
|  Akzo Nobel NV | 500 |  | 30856 |
|  Arkema SA | 300 |  | 23756 |
|  Chr Hansen Holding A/S | 400 |  | 22218 |
|  Covestro AG(b) | 1025 |  | 34890 |
|  Croda International plc | 600 |  | 46699 |
|  Ecolab, Inc. | 875 |  | 137436 |
|  Givaudan SA (Registered) | 25 |  | 74694 |
|  Hexpol AB | 2200 |  | 21700 |
|  Incitec Pivot Ltd. | 11750 |  | 28176 |
|  Kansai Paint Co. Ltd. | 2500 |  | 32630 |
|  Koninklijke DSM NV | 1300 |  | 153283 |
|  LANXESS AG | 300 |  | 10155 |
|  Mitsubishi Chemical Group Corp. | 7500 |  | 33914 |
|  Novozymes A/S, Class B | 1300 |  | 68292 |
|  OCI NV | 425 |  | 16264 |
|  Orica Ltd.(a) | 2300 |  | 20414 |
|  Sherwin-Williams Co. (The) | 725 |  | 163147 |
|  Solvay SA | 275 |  | 24799 |
|  Victrex plc | 825 |  | 15701 |
|  Wacker Chemie AG | 75 |  | 8740 |
|  Yara International ASA | 1075 |  | 47976 |
|  |  |  | **1244568** |
| **Commercial Services & Supplies – 0.3%** | **Commercial Services & Supplies – 0.3%** | **Commercial Services & Supplies – 0.3%** | **Commercial Services & Supplies – 0.3%** |
|  Cintas Corp. | 675 |  | 288596 |
|  Elis SA | 625 |  | 7172 |
|  ISS A/S\* | 1050 |  | 19278 |
|  Rentokil Initial plc | 8750 |  | 54845 |
|  Serco Group plc | 6800 |  | 12793 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** |
|  SPIE SA | 825 | $| 19308 |
|  |  |  | **401992** |
| **Communications Equipment – 0.5%** | **Communications Equipment – 0.5%** | **Communications Equipment – 0.5%** | **Communications Equipment – 0.5%** |
|  Cisco Systems, Inc. | 12250 |  | 556517 |
|  Nokia OYJ(a) | 25100 |  | 111808 |
|  |  |  | **668325** |
| **Construction & Engineering – 0.5%** | **Construction & Engineering – 0.5%** | **Construction & Engineering – 0.5%** | **Construction & Engineering – 0.5%** |
|  Arcadis NV | 550 |  | 18689 |
|  Balfour Beatty plc | 1925 |  | 6618 |
|  Bouygues SA | 1425 |  | 40675 |
|  Eiffage SA | 525 |  | 47499 |
|  Ferrovial SA | 2800 |  | 68382 |
|  Kajima Corp. | 2500 |  | 23564 |
|  Obayashi Corp. | 5000 |  | 32126 |
|  Shimizu Corp. | 2500 |  | 12497 |
|  Skanska AB, Class B | 3350 |  | 52082 |
|  Sweco AB, Class B | 1400 |  | 10515 |
|  Vinci SA | 3675 |  | 338447 |
|  WSP Global, Inc. | 250 |  | 30688 |
|  |  |  | **681782** |
| **Construction Materials – 0.2%** | **Construction Materials – 0.2%** | **Construction Materials – 0.2%** | **Construction Materials – 0.2%** |
|  CRH plc | 2200 |  | 79321 |
|  Holcim AG\* | 3275 |  | 148836 |
|  Wienerberger AG | 925 |  | 21155 |
|  |  |  | **249312** |
| **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** |
|  Capital One Financial Corp. | 1200 |  | 127224 |
|  Marui Group Co. Ltd. | 2500 |  | 41276 |
|  |  |  | **168500** |
| **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** |
|  Amcor plc | 11200 |  | 129696 |
|  Ball Corp.(a) | 1400 |  | 69146 |
|  Billerud AB | 1125 |  | 14518 |
|  DS Smith plc | 6375 |  | 21300 |
|  Huhtamaki OYJ | 525 |  | 18861 |
|  Orora Ltd. | 4700 |  | 9106 |
|  SIG Group AG\* | 850 |  | 16342 |
|  Smurfit Kappa Group plc | 1575 |  | 52195 |

---

*See Accompanying Notes to the Financial Statements.* 

298 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** |
|  Westrock Co. | 800 | $| 27248 |
|  |  |  | **358412** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  D'ieteren Group | 100 |  | 16634 |
|  Inchcape plc | 1875 |  | 16061 |
|  LKQ Corp. | 825 |  | 45903 |
|  |  |  | **78598** |
| **Diversified Financial Services – 1.7%** | **Diversified Financial Services – 1.7%** | **Diversified Financial Services – 1.7%** | **Diversified Financial Services – 1.7%** |
|  AMP Ltd.\* | 9125 |  | 7352 |
|  Apollo Global Management, Inc.(a) | 1975 |  | 109336 |
|  Berkshire Hathaway, Inc., Class B\* | 7600 |  | 2242684 |
|  Eurazeo SE | 300 |  | 17138 |
|  EXOR NV\* | 650 |  | 43685 |
|  Kinnevik AB, Class B\* | 1275 |  | 15749 |
|  M&G plc | 7425 |  | 14978 |
|  ORIX Corp. | 5000 |  | 73502 |
|  Wendel SE | 175 |  | 13716 |
|  |  |  | **2538140** |
| **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** |
|  BCE, Inc. | 2450 |  | 110372 |
|  BT Group plc | 32525 |  | 48607 |
|  Chorus Ltd.(a) | 3275 |  | 15811 |
|  Deutsche Telekom AG (Registered) | 24100 |  | 456472 |
|  Infrastrutture Wireless Italiane SpA(a) (b) | 1875 |  | 16552 |
|  Koninklijke KPN NV | 19350 |  | 54142 |
|  Nippon Telegraph & Telephone Corp. | 7500 |  | 206580 |
|  Orange SA | 7000 |  | 66632 |
|  PCCW Ltd. | 25000 |  | 9554 |
|  Proximus SADP | 2250 |  | 23594 |
|  Singapore Telecommunications Ltd. | 40000 |  | 70666 |
|  Spark New Zealand Ltd. | 14325 |  | 42609 |
|  Swisscom AG (Registered) | 150 |  | 74089 |
|  Telecom Italia SpA\* (a) | 46775 |  | 9158 |
|  Telefonica SA | 34275 |  | 118057 |
|  Telenor ASA | 1400 |  | 12725 |
|  Telia Co. AB(a) | 18950 |  | 50160 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |
|  Telstra Group Ltd. | 71250 | $| 178598 |
|  TELUS Corp. | 5050 |  | 105328 |
|  Vantage Towers AG | 775 |  | 21815 |
|  Verizon Communications, Inc. | 12475 |  | 466191 |
|  |  |  | **2157712** |
| **Electric Utilities – 0.9%** | **Electric Utilities – 0.9%** | **Electric Utilities – 0.9%** | **Electric Utilities – 0.9%** |
|  Acciona SA(a) | 150 |  | 26997 |
|  Chugoku Electric Power Co., Inc. (The) | 2500 |  | 11740 |
|  CLP Holdings Ltd. | 12500 |  | 83919 |
|  Contact Energy Ltd. | 5850 |  | 25659 |
|  EDP – Energias de Portugal SA | 15150 |  | 66258 |
|  Electricite de France SA | 3400 |  | 40157 |
|  Elia Group SA/NV(a) | 150 |  | 18961 |
|  Endesa SA(a) | 2525 |  | 42138 |
|  Enel SpA | 28725 |  | 128296 |
|  Entergy Corp. | 600 |  | 64284 |
|  Evergy, Inc. | 650 |  | 39734 |
|  Fortum OYJ | 2900 |  | 40829 |
|  Iberdrola SA | 39575 |  | 401896 |
|  Kansai Electric Power Co., Inc. (The) | 2500 |  | 18956 |
|  Origin Energy Ltd. | 8800 |  | 31343 |
|  Orsted A/S(b) | 450 |  | 37123 |
|  Red Electrica Corp. SA | 1975 |  | 31915 |
|  SSE plc | 4800 |  | 85992 |
|  Terna – Rete Elettrica Nazionale | 6600 |  | 43757 |
|  Verbund AG | 575 |  | 45038 |
|  |  |  | **1284992** |
| **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** |
|  Eaton Corp. plc | 1075 |  | 161325 |
|  Legrand SA | 1950 |  | 148671 |
|  Mitsubishi Electric Corp. | 10000 |  | 88135 |
|  NEL ASA\* (a) | 11725 |  | 14328 |
|  Nexans SA | 200 |  | 18700 |
|  Nidec Corp. | 4000 |  | 221697 |
|  Prysmian SpA | 1675 |  | 54614 |
|  Rockwell Automation, Inc.(a) | 275 |  | 70208 |
|  Schneider Electric SE | 2525 |  | 320084 |
|  Siemens Energy AG | 1275 |  | 14889 |
|  Signify NV(b) | 225 |  | 6240 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 299

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** | **Electrical Equipment – (continued)** |
|  Vestas Wind Systems A/S | 5925 | $| 116729 |
|  |  |  | **1235620** |
| **Electronic Equipment, Instruments & Components – 1.0%** | **Electronic Equipment, Instruments & Components – 1.0%** | **Electronic Equipment, Instruments & Components – 1.0%** | **Electronic Equipment, Instruments & Components – 1.0%** |
|  Amphenol Corp., Class A | 2350 |  | 178200 |
|  Corning, Inc.(a) | 3450 |  | 110987 |
|  Halma plc | 1350 |  | 32874 |
|  Hexagon AB, Class B | 10475 |  | 103513 |
|  Ibiden Co. Ltd. | 1700 |  | 57530 |
|  Keyence Corp. | 600 |  | 227349 |
|  Keysight Technologies, Inc.\* | 525 |  | 91429 |
|  Kyocera Corp. | 2500 |  | 125156 |
|  Murata Manufacturing Co. Ltd. | 5000 |  | 245568 |
|  Omron Corp. | 1200 |  | 56159 |
|  Shimadzu Corp. | 1100 |  | 29048 |
|  Taiyo Yuden Co. Ltd. | 700 |  | 19097 |
|  TDK Corp. | 2500 |  | 78296 |
|  TE Connectivity Ltd. | 950 |  | 116118 |
|  |  |  | **1471324** |
| **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** |
|  Baker Hughes Co.(a) | 2775 |  | 76756 |
|  Schlumberger NV | 10325 |  | 537210 |
|  Worley Ltd. | 2200 |  | 20075 |
|  |  |  | **634041** |
| **Entertainment – 0.8%** | **Entertainment – 0.8%** | **Entertainment – 0.8%** | **Entertainment – 0.8%** |
|  Bollore SE | 4475 |  | 22402 |
|  Walt Disney Co. (The)\* | 10725 |  | 1142641 |
|  |  |  | **1165043** |
| **Equity Real Estate Investment Trusts (REITs) – 1.6%** | **Equity Real Estate Investment Trusts (REITs) – 1.6%** | **Equity Real Estate Investment Trusts (REITs) – 1.6%** | **Equity Real Estate Investment Trusts (REITs) – 1.6%** |
|  Aedifica SA | 350 |  | 26705 |
|  Alexandria Real Estate Equities, Inc. | 475 |  | 69018 |
|  AvalonBay Communities, Inc. | 850 |  | 148852 |
|  Big Yellow Group plc | 1300 |  | 16853 |
|  Boston Properties, Inc. | 675 |  | 49073 |
|  British Land Co. plc (The) | 6850 |  | 28858 |
|  Camden Property Trust | 325 |  | 37554 |
|  CapitaLand Ascendas REIT | 10000 |  | 18515 |
|  CapitaLand Integrated Commercial Trust | 30000 |  | 39856 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Charter Hall Group(a) | 1375 | $| 11377 |
|  Charter Hall Long Wale REIT(a) | 5525 |  | 15368 |
|  Covivio | 175 |  | 9375 |
|  Dexus | 10725 |  | 53219 |
|  Digital Realty Trust, Inc.(a) | 900 |  | 90225 |
|  Equity Residential | 1050 |  | 66171 |
|  Essex Property Trust, Inc. | 125 |  | 27780 |
|  Gecina SA | 100 |  | 8920 |
|  Goodman Group | 8475 |  | 92129 |
|  Healthpeak Properties, Inc.(a) | 4225 |  | 100259 |
|  Host Hotels & Resorts, Inc. | 2050 |  | 38704 |
|  Inmobiliaria Colonial Socimi SA | 2875 |  | 15159 |
|  Iron Mountain, Inc. | 900 |  | 45063 |
|  Keppel DC REIT | 7500 |  | 9328 |
|  Kimco Realty Corp.(a) | 2750 |  | 58795 |
|  Klepierre SA\* | 775 |  | 15588 |
|  Land Securities Group plc | 5050 |  | 33165 |
|  Link REIT | 10000 |  | 59109 |
|  Mirvac Group | 22475 |  | 29749 |
|  Prologis, Inc. | 2700 |  | 299025 |
|  Realty Income Corp.(a) | 3550 |  | 221059 |
|  Safestore Holdings plc | 1375 |  | 14303 |
|  Segro plc | 7825 |  | 70723 |
|  Shopping Centres Australasia Property Group | 5300 |  | 9218 |
|  Simon Property Group, Inc. | 1025 |  | 111705 |
|  Stockland | 8050 |  | 18531 |
|  Sun Communities, Inc. | 550 |  | 74167 |
|  Unibail-Rodamco-Westfield\* | 500 |  | 23661 |
|  Ventas, Inc. | 1800 |  | 70434 |
|  Vicinity Ltd. | 27025 |  | 33612 |
|  Warehouses De Pauw CVA | 350 |  | 8987 |
|  Welltower, Inc.(a) | 3350 |  | 204484 |
|  |  |  | **2374676** |
| **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** | **Food & Staples Retailing – 1.7%** |
|  Aeon Co. Ltd. | 2500 |  | 46700 |
|  Axfood AB | 550 |  | 13608 |
|  Carrefour SA | 3800 |  | 61162 |
|  Coles Group Ltd. | 3575 |  | 37331 |
|  HelloFresh SE\* | 900 |  | 18022 |
|  J Sainsbury plc | 6050 |  | 13541 |
|  Jeronimo Martins SGPS SA | 1450 |  | 30067 |

---

*See Accompanying Notes to the Financial Statements.* 

300 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** | **Food & Staples Retailing – (continued)** |
|  Kesko OYJ, Class B | 550 | $| 10709 |
|  Koninklijke Ahold Delhaize NV | 6225 |  | 173807 |
|  Kroger Co. (The) | 2875 |  | 135959 |
|  Loblaw Cos. Ltd. | 525 |  | 42961 |
|  Marks & Spencer Group plc\* | 9225 |  | 11205 |
|  Ocado Group plc\* (a) | 1500 |  | 8158 |
|  Seven & i Holdings Co. Ltd. | 3700 |  | 138257 |
|  Walgreens Boots Alliance, Inc. | 3375 |  | 123187 |
|  Walmart, Inc. | 10650 |  | 1515814 |
|  Woolworths Group Ltd. | 8025 |  | 169445 |
|  |  |  | **2549933** |
| **Food Products – 1.2%** | **Food Products – 1.2%** | **Food Products – 1.2%** | **Food Products – 1.2%** |
|  AAK AB | 1175 |  | 17119 |
|  Ajinomoto Co., Inc. | 2500 |  | 68894 |
|  Associated British Foods plc | 750 |  | 11653 |
|  Barry Callebaut AG (Registered) | 25 |  | 47315 |
|  Bunge Ltd. | 650 |  | 64155 |
|  Danone SA | 1550 |  | 77118 |
|  Darling Ingredients, Inc.\* | 700 |  | 54936 |
|  General Mills, Inc.(a) | 2625 |  | 214148 |
|  Hershey Co. (The) | 800 |  | 191016 |
|  JDE Peet's NV | 550 |  | 15753 |
|  Kellogg Co. | 1400 |  | 107548 |
|  Kerry Group plc, Class A(a) | 600 |  | 52185 |
|  McCormick & Co., Inc. (Non-Voting)(a) | 475 |  | 37354 |
|  Mowi ASA | 3400 |  | 50705 |
|  Nestle SA (Registered) | 6425 |  | 700057 |
|  Orkla ASA | 3950 |  | 26655 |
|  Salmar ASA | 375 |  | 12703 |
|  |  |  | **1749314** |
| **Gas Utilities – 0.1%** | **Gas Utilities – 0.1%** | **Gas Utilities – 0.1%** | **Gas Utilities – 0.1%** |
|  Enagas SA(a) | 1700 |  | 27597 |
|  Italgas SpA | 1800 |  | 9278 |
|  Naturgy Energy Group SA(a) | 775 |  | 19885 |
|  Rubis SCA | 150 |  | 3410 |
|  Snam SpA | 11975 |  | 53283 |
|  Tokyo Gas Co. Ltd. | 2500 |  | 44690 |
|  |  |  | **158143** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Health Care Equipment & Supplies – 1.8%** | **Health Care Equipment & Supplies – 1.8%** | **Health Care Equipment & Supplies – 1.8%** |
|  Ansell Ltd. | 1050 | $18954 |
|  Baxter International, Inc. | 2250 | 122288 |
|  Becton Dickinson and Co. | 1225 | 289063 |
|  Boston Scientific Corp.\* | 4450 | 191839 |
|  Carl Zeiss Meditec AG | 150 | 18168 |
|  Coloplast A/S, Class B | 275 | 30667 |
|  ConvaTec Group plc(b) | 7800 | 19578 |
|  Demant A/S\* | 800 | 21868 |
|  Dexcom, Inc.\* | 1175 | 141916 |
|  DiaSorin SpA | 75 | 9807 |
|  Edwards Lifesciences Corp.\* | 3675 | 266180 |
|  Elekta AB, Class B | 1550 | 7869 |
|  Fisher & Paykel Healthcare Corp. Ltd. | 2200 | 25025 |
|  Getinge AB, Class B | 1225 | 24865 |
|  GN Store Nord A/S(a) | 1000 | 21268 |
|  Hologic, Inc.\* | 1475 | 100005 |
|  Hoya Corp. | 2500 | 233374 |
|  Intuitive Surgical, Inc.\* | 1450 | 357382 |
|  Siemens Healthineers AG(b) | 775 | 35679 |
|  Smith & Nephew plc | 1850 | 21939 |
|  Straumann Holding AG (Registered) | 750 | 71481 |
|  Stryker Corp. | 1975 | 452749 |
|  Terumo Corp. | 2500 | 76092 |
|  Zimmer Biomet Holdings, Inc. | 625 | 70844 |
|  |  | **2628900** |
| **Health Care Providers & Services – 1.9%** | **Health Care Providers & Services – 1.9%** | **Health Care Providers & Services – 1.9%** |
|  CVS Health Corp. | 3825 | 362228 |
|  Elevance Health, Inc. | 1400 | 765478 |
|  Fresenius Medical Care AG & Co. KGaA | 700 | 19358 |
|  Fresenius SE & Co. KGaA | 1650 | 37997 |
|  Galenica AG(b) | 200 | 14369 |
|  Ramsay Health Care Ltd.(a) | 1225 | 45879 |
|  Sonic Healthcare Ltd. | 2025 | 42433 |
|  Summerset Group Holdings Ltd. | 2450 | 13778 |
|  UnitedHealth Group, Inc. | 2750 | 1526663 |
|  |  | **2828183** |
| **Hotels, Restaurants & Leisure – 1.5%** | **Hotels, Restaurants & Leisure – 1.5%** | **Hotels, Restaurants & Leisure – 1.5%** |
|  Accor SA\* | 800 | 19166 |
|  Aristocrat Leisure Ltd. | 1725 | 40890 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 301

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Booking Holdings, Inc.\* | 175 | $| 327159 |
|  Chipotle Mexican Grill, Inc.\* (a) | 75 |  | 112375 |
|  Compass Group plc | 8150 |  | 172328 |
|  Domino's Pizza Enterprises Ltd.(a) | 500 |  | 20382 |
|  Domino's Pizza, Inc. | 150 |  | 49836 |
|  Entain plc | 3425 |  | 49805 |
|  Greggs plc | 500 |  | 11617 |
|  Hilton Worldwide Holdings, Inc. | 1225 |  | 165694 |
|  InterContinental Hotels Group plc | 1125 |  | 60826 |
|  La Francaise des Jeux SAEM(b) | 375 |  | 12231 |
|  Marriott International, Inc., Class A | 1275 |  | 204140 |
|  MGM Resorts International | 1625 |  | 57801 |
|  Oriental Land Co. Ltd. | 1400 |  | 187910 |
|  Sodexo SA | 575 |  | 50999 |
|  Star Entertainment Grp Ltd. (The)\* | 7825 |  | 14711 |
|  Starbucks Corp.(a) | 3425 |  | 296571 |
|  Whitbread plc | 1200 |  | 35535 |
|  Yum China Holdings, Inc. | 1275 |  | 52721 |
|  Yum! Brands, Inc. | 1575 |  | 186244 |
|  |  |  | **2128941** |
| **Household Durables – 0.7%** | **Household Durables – 0.7%** | **Household Durables – 0.7%** | **Household Durables – 0.7%** |
|  Barratt Developments plc | 2025 |  | 8771 |
|  Berkeley Group Holdings plc | 250 |  | 9991 |
|  Casio Computer Co. Ltd. | 2500 |  | 21765 |
|  Electrolux AB, Class B(a) | 1125 |  | 13872 |
|  Nikon Corp. | 2500 |  | 24203 |
|  Panasonic Holdings Corp. | 15000 |  | 107427 |
|  SEB SA | 25 |  | 1628 |
|  Sekisui Chemical Co. Ltd. | 2500 |  | 31285 |
|  Sekisui House Ltd. | 5000 |  | 83258 |
|  Sharp Corp. | 2500 |  | 14986 |
|  Sony Group Corp. | 10000 |  | 671982 |
|  Taylor Wimpey plc | 8350 |  | 9016 |
|  Vistry Group plc | 250 |  | 1736 |
|  Whirlpool Corp. | 225 |  | 31104 |
|  |  |  | **1031024** |
| **Household Products – 1.2%** | **Household Products – 1.2%** | **Household Products – 1.2%** | **Household Products – 1.2%** |
|  Clorox Co. (The)(a) | 475 |  | 69369 |
|  Colgate-Palmolive Co. | 2450 |  | 180908 |
|  Essity AB, Class B | 3675 |  | 77621 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Household Products – (continued)** | **Household Products – (continued)** | **Household Products – (continued)** | **Household Products – (continued)** |
|  Henkel AG & Co. KGaA (Preference) | 1275 | $| 80372 |
|  Kimberly-Clark Corp. | 1025 |  | 127571 |
|  Procter & Gamble Co. (The) | 7050 |  | 949424 |
|  Reckitt Benckiser Group plc | 3975 |  | 264528 |
|  Unicharm Corp. | 1200 |  | 36589 |
|  |  |  | **1786382** |
| **Independent Power and Renewable Electricity<br>Producers – 0.0%(c)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(c)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(c)** | **Independent Power and Renewable Electricity<br>Producers – 0.0%(c)** |
|  Drax Group plc | 1525 |  | 9148 |
|  Meridian Energy Ltd. | 6650 |  | 18853 |
|  |  |  | **28001** |
| **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** |
|  3M Co. | 1375 |  | 172961 |
|  CK Hutchison Holdings Ltd. | 12500 |  | 62103 |
|  General Electric Co. | 7800 |  | 606918 |
|  Hitachi Ltd. | 5000 |  | 227403 |
|  Investment AB Latour, Class B(a) | 750 |  | 12675 |
|  Keppel Corp. Ltd. | 7500 |  | 36941 |
|  Melrose Industries plc | 12400 |  | 16689 |
|  Siemens AG (Registered) | 2575 |  | 281579 |
|  Smiths Group plc | 1925 |  | 34586 |
|  Toshiba Corp. | 1400 |  | 48800 |
|  |  |  | **1500655** |
| **Insurance – 1.9%** | **Insurance – 1.9%** | **Insurance – 1.9%** | **Insurance – 1.9%** |
|  Admiral Group plc | 450 |  | 10450 |
|  Aegon NV(a) | 5950 |  | 27551 |
|  Aflac, Inc. | 2625 |  | 170914 |
|  AIA Group Ltd. | 30000 |  | 227202 |
|  Assicurazioni Generali SpA | 7450 |  | 111847 |
|  Aviva plc | 13325 |  | 64144 |
|  AXA SA | 12850 |  | 317507 |
|  Direct Line Insurance Group plc | 6900 |  | 16032 |
|  Gjensidige Forsikring ASA | 1450 |  | 26484 |
|  Hannover Rueck SE | 250 |  | 40720 |
|  Insurance Australia Group Ltd.(a) | 12800 |  | 40106 |
|  Japan Post Holdings Co. Ltd. | 12500 |  | 84065 |
|  Medibank Pvt Ltd. | 17150 |  | 30816 |
|  MetLife, Inc. | 2125 |  | 155571 |

---

*See Accompanying Notes to the Financial Statements.* 

302 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | 950 | $| 251071 |
|  nib holdings Ltd. | 2300 |  | 9810 |
|  NN Group NV | 1950 |  | 82584 |
|  Phoenix Group Holdings plc | 3600 |  | 22482 |
|  Poste Italiane SpA(b) | 2150 |  | 18742 |
|  Power Corp. of Canada | 2500 |  | 62003 |
|  Principal Financial Group, Inc.(a) | 1450 |  | 127789 |
|  Prudential plc | 7625 |  | 71181 |
|  QBE Insurance Group Ltd.(a) | 6225 |  | 48722 |
|  Storebrand ASA | 2775 |  | 21566 |
|  Sun Life Financial, Inc. | 1875 |  | 79533 |
|  Suncorp Group Ltd. | 5575 |  | 40676 |
|  Swiss Life Holding AG (Registered) | 150 |  | 72681 |
|  Swiss Re AG | 1200 |  | 89213 |
|  Topdanmark A/S | 125 |  | 5775 |
|  Tryg A/S | 2375 |  | 51409 |
|  Willis Towers Watson plc | 325 |  | 70918 |
|  Zurich Insurance Group AG | 675 |  | 288211 |
|  |  |  | **2737775** |
| **Interactive Media & Services – 2.4%** | **Interactive Media & Services – 2.4%** | **Interactive Media & Services – 2.4%** | **Interactive Media & Services – 2.4%** |
|  Alphabet, Inc., Class C\* | 18675 |  | 1767776 |
|  Auto Trader Group plc(b) | 5575 |  | 33480 |
|  carsales.com Ltd.(a) | 2250 |  | 29236 |
|  Meta Platforms, Inc., Class A\* | 16750 |  | 1560430 |
|  REA Group Ltd. | 400 |  | 31100 |
|  Rightmove plc | 3350 |  | 18969 |
|  Snap, Inc., Class A\* | 7800 |  | 77298 |
|  Z Holdings Corp. | 17500 |  | 45282 |
|  |  |  | **3563571** |
| **Internet & Direct Marketing Retail – 3.9%** | **Internet & Direct Marketing Retail – 3.9%** | **Internet & Direct Marketing Retail – 3.9%** | **Internet & Direct Marketing Retail – 3.9%** |
|  Amazon.com, Inc.\* | 53875 |  | 5518955 |
|  eBay, Inc. | 2600 |  | 103584 |
|  Etsy, Inc.\* (a) | 750 |  | 70432 |
|  Just Eat Takeaway.com NV\* (b) | 1025 |  | 17587 |
|  Rakuten Group, Inc.(a) | 7500 |  | 33606 |
|  Zalando SE\* (b) | 517 |  | 11921 |
|  Zalando SE\* (b) | 233 |  | 5373 |
|  |  |  | **5761458** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **IT Services – 3.6%** | **IT Services – 3.6%** | **IT Services – 3.6%** |
|  Accenture plc, Class A | 5900 | $1675010 |
|  Alten SA | 75 | 8769 |
|  Automatic Data Processing, Inc. | 1850 | 447145 |
|  Bechtle AG | 675 | 23350 |
|  Capgemini SE | 1125 | 184852 |
|  CGI, Inc.\* | 1475 | 118666 |
|  Cognizant Technology Solutions Corp., Class A | 3050 | 189863 |
|  Computacenter plc | 625 | 13025 |
|  Edenred | 1525 | 78316 |
|  Fujitsu Ltd. | 1600 | 184344 |
|  Gartner, Inc.\* | 450 | 135864 |
|  International Business Machines Corp. | 6625 | 916171 |
|  Mastercard, Inc., Class A | 2525 | 828655 |
|  NEC Corp. | 2500 | 82837 |
|  Nexi SpA\* (b) | 4175 | 36188 |
|  Nomura Research Institute Ltd. | 1100 | 24459 |
|  NTT Data Corp. | 2500 | 36280 |
|  PayPal Holdings, Inc.\* | 3375 | 282082 |
|  Softcat plc | 500 | 6448 |
|  Sopra Steria Group SACA | 75 | 9933 |
|  Worldline SA\* (b) | 1650 | 72276 |
|  |  | **5354533** |
| **Leisure Products – 0.1%** | **Leisure Products – 0.1%** | **Leisure Products – 0.1%** |
|  Bandai Namco Holdings, Inc. | 1000 | 66216 |
|  Hasbro, Inc. | 750 | 48937 |
|  Thule Group AB(b) | 450 | 8861 |
|  Yamaha Corp. | 900 | 34030 |
|  |  | **158044** |
| **Life Sciences Tools & Services – 1.1%** | **Life Sciences Tools & Services – 1.1%** | **Life Sciences Tools & Services – 1.1%** |
|  Agilent Technologies, Inc. | 875 | 121056 |
|  Bio-Rad Laboratories, Inc., Class A\* | 125 | 43964 |
|  Charles River Laboratories International, Inc.\* | 75 | 15919 |
|  Danaher Corp. | 2975 | 748718 |
|  Eurofins Scientific SE | 925 | 59223 |
|  Illumina, Inc.\* | 700 | 160174 |
|  Lonza Group AG (Registered) | 375 | 193130 |
|  QIAGEN NV\* | 925 | 39952 |
|  Sartorius AG (Preference) | 150 | 52941 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 303

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** | **Life Sciences Tools & Services – (continued)** |
|  Siegfried Holding AG (Registered)\* | 25 | $| 14889 |
|  Tecan Group AG (Registered) | 75 |  | 27534 |
|  West Pharmaceutical Services, Inc. | 100 |  | 23010 |
|  Wuxi Biologics Cayman, Inc.\* (b) | 12500 |  | 56530 |
|  |  |  | **1557040** |
| **Machinery – 1.2%** | **Machinery – 1.2%** | **Machinery – 1.2%** | **Machinery – 1.2%** |
|  Aalberts NV | 775 |  | 26947 |
|  Alfa Laval AB | 1725 |  | 42475 |
|  Alstom SA(a) | 950 |  | 19586 |
|  ANDRITZ AG | 325 |  | 15116 |
|  Atlas Copco AB, Class A(a) | 12000 |  | 128183 |
|  Bucher Industries AG (Registered) | 50 |  | 16857 |
|  CNH Industrial NV | 3175 |  | 41124 |
|  Cummins, Inc.(a) | 350 |  | 85579 |
|  Ebara Corp. | 300 |  | 9779 |
|  Epiroc AB, Class A | 3950 |  | 60427 |
|  FANUC Corp. | 500 |  | 66034 |
|  Fortive Corp. | 1075 |  | 68692 |
|  GEA Group AG | 750 |  | 26241 |
|  Georg Fischer AG (Registered) | 675 |  | 37401 |
|  Husqvarna AB, Class B | 4550 |  | 27011 |
|  IMI plc | 400 |  | 5655 |
|  Indutrade AB | 1275 |  | 22309 |
|  KION Group AG | 25 |  | 555 |
|  Knorr-Bremse AG | 525 |  | 23640 |
|  Komatsu Ltd. | 5000 |  | 95805 |
|  Kone OYJ, Class B | 2950 |  | 120853 |
|  Kubota Corp. | 5000 |  | 69852 |
|  Metso Outotec OYJ | 3900 |  | 29611 |
|  Mitsubishi Heavy Industries Ltd. | 2500 |  | 86117 |
|  NGK Insulators Ltd. | 2500 |  | 29216 |
|  NSK Ltd. | 2500 |  | 13220 |
|  Otis Worldwide Corp. | 1300 |  | 91832 |
|  Rotork plc | 7825 |  | 23082 |
|  Sandvik AB | 6975 |  | 108944 |
|  Schindler Holding AG | 150 |  | 24469 |
|  SKF AB, Class B(a) | 2225 |  | 32176 |
|  Spirax-Sarco Engineering plc | 175 |  | 21660 |
|  Stanley Black & Decker, Inc. | 700 |  | 54943 |
|  Techtronic Industries Co. Ltd. | 3000 |  | 28415 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Trelleborg AB, Class B | 2150 | $| 47337 |
|  Valmet OYJ(a) | 1200 |  | 27314 |
|  Volvo AB, Class B | 8025 |  | 131300 |
|  Wartsila OYJ Abp(a) | 3725 |  | 25403 |
|  Weir Group plc (The) | 650 |  | 11394 |
|  |  |  | **1796554** |
| **Marine – 0.1%** | **Marine – 0.1%** | **Marine – 0.1%** | **Marine – 0.1%** |
|  AP Moller – Maersk A/S, Class B | 25 |  | 52307 |
|  Kuehne + Nagel International AG (Registered) | 175 |  | 37317 |
|  Mitsui OSK Lines Ltd.(a) | 2500 |  | 49635 |
|  Nippon Yusen KK(a) | 2700 |  | 49028 |
|  Pacific Basin Shipping Ltd.(a) | 25000 |  | 6051 |
|  |  |  | **194338** |
| **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** |
|  Dentsu Group, Inc. | 1200 |  | 37421 |
|  Informa plc | 8825 |  | 56453 |
|  Interpublic Group of Cos., Inc. (The) | 2575 |  | 76709 |
|  ITV plc | 6175 |  | 4763 |
|  Pearson plc | 4075 |  | 45060 |
|  Publicis Groupe SA | 1575 |  | 88324 |
|  Viaplay Group AB, Class B\* | 750 |  | 13683 |
|  Vivendi SE | 2200 |  | 18012 |
|  WPP plc | 3225 |  | 28442 |
|  |  |  | **368867** |
| **Metals & Mining – 1.5%** | **Metals & Mining – 1.5%** | **Metals & Mining – 1.5%** | **Metals & Mining – 1.5%** |
|  Anglo American plc | 5675 |  | 170437 |
|  Antofagasta plc | 1600 |  | 21655 |
|  ArcelorMittal SA | 2225 |  | 49820 |
|  Aurubis AG | 200 |  | 12635 |
|  BHP Group Ltd. | 28675 |  | 685041 |
|  BlueScope Steel Ltd.(a) | 2675 |  | 26907 |
|  Boliden AB | 1300 |  | 37834 |
|  Fortescue Metals Group Ltd. | 9575 |  | 90004 |
|  Freeport-McMoRan, Inc. | 4300 |  | 136267 |
|  Iluka Resources Ltd. | 3225 |  | 17838 |
|  JFE Holdings, Inc. | 2500 |  | 22925 |
|  Lynas Rare Earths Ltd.\* | 5225 |  | 27832 |
|  Mineral Resources Ltd. | 1050 |  | 49101 |
|  Newcrest Mining Ltd.(a) | 1325 |  | 14700 |

---

*See Accompanying Notes to the Financial Statements.* 

304 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Newmont Corp. | 3650 | $| 154439 |
|  Norsk Hydro ASA | 8250 |  | 52356 |
|  Northern Star Resources Ltd.(a) | 7925 |  | 44291 |
|  Nucor Corp. | 750 |  | 98535 |
|  Rio Tinto Ltd. | 1925 |  | 108569 |
|  Rio Tinto plc | 5100 |  | 266407 |
|  Sims Ltd. | 500 |  | 3907 |
|  South32 Ltd. | 22550 |  | 51911 |
|  SSAB AB, Class B | 2975 |  | 13822 |
|  Sumitomo Metal Mining Co. Ltd. | 600 |  | 16882 |
|  thyssenkrupp AG\* | 1525 |  | 8037 |
|  voestalpine AG | 25 |  | 543 |
|  |  |  | **2182695** |
| **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** |
|  Dollar Tree, Inc.\* | 650 |  | 103025 |
|  Dollarama, Inc. | 650 |  | 38574 |
|  Isetan Mitsukoshi Holdings Ltd. | 2600 |  | 23090 |
|  J Front Retailing Co. Ltd. | 2500 |  | 20217 |
|  Next plc | 700 |  | 39725 |
|  Target Corp. | 1300 |  | 213525 |
|  Wesfarmers Ltd. | 7400 |  | 215114 |
|  |  |  | **653270** |
| **Multi-Utilities – 0.4%** | **Multi-Utilities – 0.4%** | **Multi-Utilities – 0.4%** | **Multi-Utilities – 0.4%** |
|  A2A SpA | 17750 |  | 19683 |
|  AGL Energy Ltd.(a) | 5200 |  | 22644 |
|  Centrica plc | 15350 |  | 13541 |
|  CMS Energy Corp. | 775 |  | 44214 |
|  Engie SA | 10125 |  | 131633 |
|  Hera SpA | 8825 |  | 21038 |
|  National Grid plc | 16700 |  | 182354 |
|  Sempra Energy | 1075 |  | 162261 |
|  Veolia Environnement SA | 2400 |  | 53584 |
|  |  |  | **650952** |
| **Oil, Gas & Consumable Fuels – 6.8%** | **Oil, Gas & Consumable Fuels – 6.8%** | **Oil, Gas & Consumable Fuels – 6.8%** | **Oil, Gas & Consumable Fuels – 6.8%** |
|  Aker BP ASA(a) | 1450 |  | 46219 |
|  Ampol Ltd. | 1675 |  | 29165 |
|  APA Corp. | 900 |  | 40914 |
|  BP plc | 70375 |  | 388764 |
|  Chevron Corp. | 15875 |  | 2871787 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Enbridge, Inc. | 7125 | $| 277259 |
|  Eni SpA | 17150 |  | 224658 |
|  Equinor ASA | 7125 |  | 260655 |
|  Exxon Mobil Corp. | 30475 |  | 3376935 |
|  Galp Energia SGPS SA, Class B | 2225 |  | 22596 |
|  Gaztransport Et Technigaz SA | 175 |  | 20358 |
|  OMV AG | 500 |  | 23048 |
|  Phillips 66(a) | 3525 |  | 367622 |
|  Repsol SA | 2650 |  | 36000 |
|  Shell plc | 38850 |  | 1073975 |
|  Suncor Energy, Inc. | 4700 |  | 161462 |
|  TotalEnergies SE | 11275 |  | 614015 |
|  Tourmaline Oil Corp. | 700 |  | 39392 |
|  Woodside Energy Group Ltd. | 6600 |  | 151849 |
|  |  |  | **10026673** |
| **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** |
|  Mondi plc | 1825 |  | 30730 |
|  Stora Enso OYJ, Class R | 2925 |  | 38131 |
|  Svenska Cellulosa AB SCA, Class B | 3400 |  | 40091 |
|  |  |  | **108952** |
| **Personal Products – 1.1%** | **Personal Products – 1.1%** | **Personal Products – 1.1%** | **Personal Products – 1.1%** |
|  Beiersdorf AG | 475 |  | 45623 |
|  Estee Lauder Cos., Inc. (The), Class A | 1450 |  | 290711 |
|  Kao Corp. | 1200 |  | 45131 |
|  L'Oreal SA | 1625 |  | 510890 |
|  Shiseido Co. Ltd. | 3600 |  | 124856 |
|  Unilever plc | 8501 |  | 389009 |
|  Unilever plc | 5649 |  | 258027 |
|  |  |  | **1664247** |
| **Pharmaceuticals – 11.1%** | **Pharmaceuticals – 11.1%** | **Pharmaceuticals – 11.1%** | **Pharmaceuticals – 11.1%** |
|  ALK-Abello A/S\* | 1075 |  | 17811 |
|  Astellas Pharma, Inc. | 10000 |  | 137686 |
|  AstraZeneca plc | 8275 |  | 976942 |
|  Bayer AG (Registered) | 3425 |  | 180155 |
|  Bristol-Myers Squibb Co. | 9550 |  | 739838 |
|  Chugai Pharmaceutical Co. Ltd. | 2500 |  | 58028 |
|  Daiichi Sankyo Co. Ltd. | 10000 |  | 320719 |
|  Dechra Pharmaceuticals plc | 750 |  | 22624 |
|  Eisai Co. Ltd. | 1300 |  | 78489 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 305

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Eli Lilly & Co. | 4200 | $| 1520778 |
|  GSK plc | 22075 |  | 363144 |
|  Ipsen SA | 125 |  | 12849 |
|  Johnson & Johnson | 23125 |  | 4023056 |
|  Kyowa Kirin Co. Ltd. | 2500 |  | 58953 |
|  Merck & Co., Inc. | 18525 |  | 1874730 |
|  Merck KGaA | 675 |  | 110077 |
|  Novartis AG (Registered) | 15550 |  | 1257052 |
|  Novo Nordisk A/S, Class B | 5650 |  | 614389 |
|  Ono Pharmaceutical Co. Ltd. | 2500 |  | 58802 |
|  Orion OYJ, Class B | 725 |  | 33356 |
|  Otsuka Holdings Co. Ltd. | 1300 |  | 41685 |
|  Pfizer, Inc. | 32925 |  | 1532659 |
|  Roche Holding AG | 4100 |  | 1362433 |
|  Sanofi | 7450 |  | 643029 |
|  Shionogi & Co. Ltd. | 2500 |  | 115888 |
|  Takeda Pharmaceutical Co. Ltd. | 5000 |  | 131799 |
|  UCB SA | 325 |  | 24515 |
|  |  |  | **16311486** |
| **Professional Services – 0.5%** | **Professional Services – 0.5%** | **Professional Services – 0.5%** | **Professional Services – 0.5%** |
|  Adecco Group AG (Registered) | 400 |  | 12527 |
|  ALS Ltd.(a) | 1475 |  | 10790 |
|  Booz Allen Hamilton Holding Corp. | 600 |  | 65310 |
|  Bureau Veritas SA | 2150 |  | 53272 |
|  DKSH Holding AG | 125 |  | 9012 |
|  Experian plc | 2600 |  | 83040 |
|  Intertek Group plc | 925 |  | 38915 |
|  Randstad NV | 175 |  | 8724 |
|  RELX plc | 10575 |  | 285029 |
|  SGS SA (Registered) | 25 |  | 55184 |
|  Verisk Analytics, Inc. | 700 |  | 127981 |
|  |  |  | **749784** |
| **Real Estate Management & Development – 0.5%** | **Real Estate Management & Development – 0.5%** | **Real Estate Management & Development – 0.5%** | **Real Estate Management & Development – 0.5%** |
|  Castellum AB(a) | 1675 |  | 19144 |
|  CBRE Group, Inc., Class A\* | 2175 |  | 154294 |
|  City Developments Ltd. | 2500 |  | 13480 |
|  CK Asset Holdings Ltd. | 7000 |  | 38701 |
|  Daiwa House Industry Co. Ltd. | 2500 |  | 50661 |
|  Fabege AB | 1475 |  | 10702 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Hongkong Land Holdings Ltd. | 2500 | $| 9625 |
|  Lendlease Corp. Ltd. | 6225 |  | 34591 |
|  Mitsubishi Estate Co. Ltd. | 5000 |  | 63007 |
|  Mitsui Fudosan Co. Ltd. | 2500 |  | 47928 |
|  Sagax AB, Class B | 575 |  | 10594 |
|  Samhallsbyggnadsbolaget i Norden AB(a) | 4650 |  | 6388 |
|  Sun Hung Kai Properties Ltd. | 6000 |  | 64549 |
|  Swire Properties Ltd. | 15000 |  | 28816 |
|  Swiss Prime Site AG (Registered) | 600 |  | 48444 |
|  Tokyu Fudosan Holdings Corp. | 2500 |  | 12699 |
|  Vonovia SE | 5450 |  | 120658 |
|  Wihlborgs Fastigheter AB | 2575 |  | 16871 |
|  |  |  | **751152** |
| **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** |
|  Canadian National Railway Co. | 3075 |  | 363847 |
|  Canadian Pacific Railway Ltd. | 4325 |  | 322017 |
|  ComfortDelGro Corp. Ltd. | 17500 |  | 15706 |
|  Hankyu Hanshin Holdings, Inc. | 1100 |  | 32674 |
|  MTR Corp. Ltd. | 12500 |  | 55017 |
|  Uber Technologies, Inc.\* | 8650 |  | 229830 |
|  |  |  | **1019091** |
| **Semiconductors & Semiconductor Equipment – 4.6%** | **Semiconductors & Semiconductor Equipment – 4.6%** | **Semiconductors & Semiconductor Equipment – 4.6%** | **Semiconductors & Semiconductor Equipment – 4.6%** |
|  Advanced Micro Devices, Inc.\* | 4425 |  | 265766 |
|  ams-OSRAM AG\* | 2550 |  | 14463 |
|  Analog Devices, Inc. | 2325 |  | 331591 |
|  Applied Materials, Inc. | 5275 |  | 465730 |
|  ASM International NV | 325 |  | 72209 |
|  ASML Holding NV | 1850 |  | 873998 |
|  BE Semiconductor Industries NV | 675 |  | 34504 |
|  Infineon Technologies AG | 7200 |  | 175341 |
|  Intel Corp. | 24375 |  | 692981 |
|  Lam Research Corp. | 575 |  | 232749 |
|  Microchip Technology, Inc. | 2150 |  | 132741 |
|  Micron Technology, Inc. | 6575 |  | 355708 |
|  NVIDIA Corp. | 7375 |  | 995404 |
|  Qorvo, Inc.\* | 450 |  | 38736 |
|  QUALCOMM, Inc. | 4975 |  | 585359 |
|  Renesas Electronics Corp.\* | 7500 |  | 62897 |
|  Rohm Co. Ltd. | 400 |  | 28176 |
|  Skyworks Solutions, Inc. | 550 |  | 47305 |

---

*See Accompanying Notes to the Financial Statements.* 

306 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  SOITEC\* | 175 | $| 22476 |
|  STMicroelectronics NV | 3550 |  | 110873 |
|  SUMCO Corp. | 2500 |  | 31772 |
|  Teradyne, Inc.(a) | 250 |  | 20338 |
|  Texas Instruments, Inc. | 5400 |  | 867402 |
|  Tokyo Electron Ltd. | 800 |  | 212548 |
|  Wolfspeed, Inc.\* (a) | 375 |  | 29531 |
|  |  |  | **6700598** |
| **Software – 8.1%** | **Software – 8.1%** | **Software – 8.1%** | **Software – 8.1%** |
|  Adobe, Inc.\* | 2750 |  | 875875 |
|  Autodesk, Inc.\* | 1500 |  | 321450 |
|  Cadence Design Systems, Inc.\* | 800 |  | 121112 |
|  Check Point Software Technologies Ltd.\* | 275 |  | 35538 |
|  Crowdstrike Holdings, Inc., Class A\* | 950 |  | 153140 |
|  Dassault Systemes SE | 3975 |  | 133379 |
|  DocuSign, Inc.\* (a) | 1225 |  | 59167 |
|  Fortinet, Inc.\* | 2875 |  | 164335 |
|  Intuit, Inc. | 1200 |  | 513000 |
|  Microsoft Corp. | 29075 |  | 6749180 |
|  Netcompany Group A/S\* (a) (b) | 425 |  | 14591 |
|  Oracle Corp. | 6725 |  | 525021 |
|  Palo Alto Networks, Inc.\* | 1275 |  | 218777 |
|  Sage Group plc (The) | 5625 |  | 47070 |
|  Salesforce, Inc.\* | 4400 |  | 715396 |
|  SAP SE | 6400 |  | 617806 |
|  ServiceNow, Inc.\* | 550 |  | 231407 |
|  SimCorp A/S | 250 |  | 14935 |
|  Splunk, Inc.\* | 675 |  | 56099 |
|  Synopsys, Inc.\* | 650 |  | 190158 |
|  WiseTech Global Ltd. | 1025 |  | 38120 |
|  Zendesk, Inc.\* | 550 |  | 42180 |
|  |  |  | **11837736** |
| **Specialty Retail – 1.2%** | **Specialty Retail – 1.2%** | **Specialty Retail – 1.2%** | **Specialty Retail – 1.2%** |
|  AutoZone, Inc.\* | 50 |  | 126644 |
|  Best Buy Co., Inc. | 1250 |  | 85512 |
|  Fast Retailing Co. Ltd. | 300 |  | 167504 |
|  H & M Hennes & Mauritz AB, Class B(a) | 2950 |  | 29686 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Industria de Diseno Textil SA(a) | 2800 | $| 63484 |
|  JB Hi-Fi Ltd.(a) | 275 |  | 7546 |
|  Kingfisher plc | 11100 |  | 27975 |
|  Lowe's Cos., Inc. | 2050 |  | 399647 |
|  Ross Stores, Inc. | 1575 |  | 150712 |
|  TJX Cos., Inc. (The) | 6900 |  | 497490 |
|  Tractor Supply Co. | 575 |  | 126368 |
|  Williams-Sonoma, Inc.(a) | 625 |  | 77394 |
|  Yamada Holdings Co. Ltd. | 5000 |  | 16113 |
|  |  |  | **1776075** |
| **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** | **Technology Hardware, Storage & Peripherals – 5.6%** |
|  Apple, Inc. | 48850 |  | 7490659 |
|  Brother Industries Ltd. | 2500 |  | 42571 |
|  Canon, Inc.(a) | 2500 |  | 53049 |
|  Dell Technologies, Inc., Class C | 625 |  | 24000 |
|  FUJIFILM Holdings Corp. | 2500 |  | 114694 |
|  Hewlett Packard Enterprise Co. | 8350 |  | 119154 |
|  HP, Inc. | 6900 |  | 190578 |
|  Konica Minolta, Inc.(a) | 2500 |  | 7619 |
|  Logitech International SA (Registered) | 450 |  | 22416 |
|  NetApp, Inc. | 975 |  | 67538 |
|  Ricoh Co. Ltd. | 2500 |  | 18334 |
|  Seagate Technology Holdings plc | 700 |  | 34762 |
|  Western Digital Corp.\* (a) | 2375 |  | 81629 |
|  |  |  | **8267003** |
| **Textiles, Apparel & Luxury Goods – 1.7%** | **Textiles, Apparel & Luxury Goods – 1.7%** | **Textiles, Apparel & Luxury Goods – 1.7%** | **Textiles, Apparel & Luxury Goods – 1.7%** |
|  adidas AG | 325 |  | 31794 |
|  Asics Corp. | 2500 |  | 38416 |
|  Burberry Group plc | 1675 |  | 35002 |
|  Christian Dior SE | 50 |  | 30960 |
|  Hermes International | 150 |  | 194285 |
|  HUGO BOSS AG | 425 |  | 19591 |
|  Kering SA | 450 |  | 206234 |
|  Lululemon Athletica, Inc.\* | 900 |  | 296136 |
|  LVMH Moet Hennessy Louis Vuitton SE | 1675 |  | 1057856 |
|  Moncler SpA | 1350 |  | 58294 |
|  NIKE, Inc., Class B | 3750 |  | 347550 |
|  Pandora A/S | 550 |  | 28995 |
|  Puma SE | 875 |  | 38752 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 307

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** | **Textiles, Apparel & Luxury Goods – (continued)** |
|  Swatch Group AG (The) | 225 | $| 50677 |
|  VF Corp. | 1800 |  | 50850 |
|  |  |  | **2485392** |
| **Thrifts & Mortgage Finance – 0.0%(c)** | **Thrifts & Mortgage Finance – 0.0%(c)** | **Thrifts & Mortgage Finance – 0.0%(c)** | **Thrifts & Mortgage Finance – 0.0%(c)** |
|  OSB Group plc | 1400 |  | 6686 |
| **Tobacco – 0.5%** | **Tobacco – 0.5%** | **Tobacco – 0.5%** | **Tobacco – 0.5%** |
|  Altria Group, Inc. | 5350 |  | 247544 |
|  British American Tobacco plc | 9225 |  | 364679 |
|  Japan Tobacco, Inc. | 5000 |  | 82888 |
|  |  |  | **695111** |
| **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** |
|  AddTech AB, Class B | 1450 |  | 17531 |
|  Ashtead Group plc | 2075 |  | 108702 |
|  Bunzl plc | 1075 |  | 35163 |
|  Ferguson plc | 1150 |  | 125917 |
|  Grafton Group plc | 450 |  | 3575 |
|  IMCD NV | 100 |  | 12977 |
|  Marubeni Corp. | 5000 |  | 43832 |
|  Mitsubishi Corp. | 5000 |  | 135601 |
|  Mitsui & Co. Ltd. | 10000 |  | 221549 |
|  Rexel SA | 1650 |  | 29525 |
|  RS GROUP plc | 1525 |  | 16829 |
|  Sojitz Corp. | 1599 |  | 23603 |
|  Sumitomo Corp. | 5000 |  | 63764 |
|  Toyota Tsusho Corp. | 2500 |  | 84099 |
|  Travis Perkins plc | 2650 |  | 25104 |
|  |  |  | **947771** |
| **Transportation Infrastructure – 0.2%** | **Transportation Infrastructure – 0.2%** | **Transportation Infrastructure – 0.2%** | **Transportation Infrastructure – 0.2%** |
|  Aena SME SA\* (b) | 150 |  | 17664 |
|  Aeroports de Paris\* | 150 |  | 20318 |
|  Atlantia SpA | 2100 |  | 46866 |
|  Auckland International Airport Ltd.\* | 10375 |  | 46411 |
|  Getlink SE | 3200 |  | 50698 |
|  Qube Holdings Ltd. | 7450 |  | 12958 |
|  SATS Ltd.\* | 5000 |  | 9646 |
|  Transurban Group | 14125 |  | 119767 |
|  |  |  | **324328** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Water Utilities – 0.1%** | **Water Utilities – 0.1%** | **Water Utilities – 0.1%** |
|  American Water Works Co., Inc. | 825 | $119906 |
|  Severn Trent plc | 1500 | 43227 |
|  United Utilities Group plc | 850 | 9193 |
|  |  | **172326** |
| **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** |
|  Millicom International Cellular SA, SDR\* | 975 | 10570 |
|  SoftBank Group Corp. | 2500 | 107646 |
|  Tele2 AB, Class B | 1450 | 11878 |
|  Vodafone Group plc | 123825 | 144904 |
|  |  | **274998** |
| **Total Common Stocks <br>(Cost $136,248,995)** | **Total Common Stocks <br>(Cost $136,248,995)** | **145829313** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(d) – 0.3%** | **SECURITIES LENDING REINVESTMENTS(d) – 0.3%** | **SECURITIES LENDING REINVESTMENTS(d) – 0.3%** |
| **REPURCHASE AGREEMENTS – 0.3%** | **REPURCHASE AGREEMENTS – 0.3%** | **REPURCHASE AGREEMENTS – 0.3%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $442,983, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $446,092 <br>(Cost $442,946) | $442946 | 442946 |
| **Total Investments – 99.6% <br>(Cost $136,691,941)** | **Total Investments – 99.6% <br>(Cost $136,691,941)** | **146272259** |
|  Other assets less liabilities – 0.4% | Other assets less liabilities – 0.4% | 653218 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**146925477** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $3,600,349, collateralized in the form of cash with a value of $442,946 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $2,959,846 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $381,893 of collateral in the form of Foreign* 

*See Accompanying Notes to the Financial Statements.* 

308 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

------

*Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from January 18, 2023 – June 30, 2120; a total value of $3,784,685.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(d)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $442,946.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*CVA – Dutch Certification* 

*OYJ – Public Limited Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*SCA – Limited partnership with share capital* 

*SDR – Swedish Depositary Receipt* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $22418337 |
|  Aggregate gross unrealized depreciation | (12896511) |
|  Net unrealized appreciation | $9521826 |
|  Federal income tax cost | $136719142 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI EAFE E-Mini Index | 5 | 12/16/2022 | USD | $438975 | $(11683) |
|  S&P 500 E-Mini Index | 3 | 12/16/2022 | USD | 582450 | (24204) |
|  |  |  |  |  | $(35887) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity<br>Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 116603 | Bank of New York | JPY | 16540000 | 12/21/2022 | $4596 |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation |  | $4596 |

---

*Abbreviations:* 

*JPY – Japanese Yen* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 309

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (cont.)

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*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 3.3 | % |
|  Austria | 0.1 |  |
|  Belgium | 0.3 |  |
|  Canada | 2.4 |  |
|  Denmark | 1 |  |
|  Finland | 0.5 |  |
|  France | 4.7 |  |
|  Germany | 2.6 |  |
|  Hong Kong | 0.7 |  |
|  Ireland | 0.2 |  |
|  Italy | 1.1 |  |
|  Japan | 7 |  |
|  Luxembourg | 0 | <sup>†</sup> |
|  Netherlands | 2.2 |  |
|  New Zealand | 0.1 |  |
|  Norway | 0.4 |  |
|  Portugal | 0.1 |  |
|  Singapore | 0.4 |  |
|  Spain | 1 |  |
|  Sweden | 1.2 |  |
|  Switzerland | 3.5 |  |
|  United Kingdom | 5.3 |  |
|  United States | 61.2 |  |
|  Other<sup>1</sup> | 0.7 |  |
|  | 100 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.3% |
|  Securities Lending Reinvestments | 0.3 |
|  Others<sup>(1)</sup> | 0.4 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

310 FLEXSHARES ANNUAL REPORT

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## Schedule of Investments

## FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.2%** | **COMMON STOCKS – 99.2%** | **COMMON STOCKS – 99.2%** |
| **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** |
|  United Parcel Service, Inc., Class B | 220 | $36909 |
| **Automobiles – 2.0%** | **Automobiles – 2.0%** | **Automobiles – 2.0%** |
|  Tesla, Inc.\* | 1980 | 450529 |
| **Banks – 4.0%** | **Banks – 4.0%** | **Banks – 4.0%** |
|  Bank of America Corp. | 9380 | 338055 |
|  Citigroup, Inc. | 3940 | 180688 |
|  Fifth Third Bancorp | 560 | 19986 |
|  JPMorgan Chase & Co. | 2420 | 304630 |
|  KeyCorp | 740 | 13224 |
|  PNC Financial Services Group, Inc. (The) | 120 | 19420 |
|  |  | **876003** |
| **Beverages – 1.7%** | **Beverages – 1.7%** | **Beverages – 1.7%** |
|  Coca-Cola Co. (The) | 780 | 46683 |
|  PepsiCo, Inc. | 1860 | 337739 |
|  |  | **384422** |
| **Biotechnology – 3.3%** | **Biotechnology – 3.3%** | **Biotechnology – 3.3%** |
|  AbbVie, Inc. | 1620 | 237168 |
|  Amgen, Inc. | 1060 | 286571 |
|  Biogen, Inc.\* | 460 | 130382 |
|  Regeneron Pharmaceuticals, Inc.\* | 40 | 29950 |
|  Vertex Pharmaceuticals, Inc.\* | 120 | 37440 |
|  |  | **721511** |
| **Building Products – 1.2%** | **Building Products – 1.2%** | **Building Products – 1.2%** |
|  Carrier Global Corp. | 440 | 17495 |
|  Johnson Controls International plc | 2180 | 126091 |
|  Trane Technologies plc | 740 | 118126 |
|  |  | **261712** |
| **Capital Markets – 3.8%** | **Capital Markets – 3.8%** | **Capital Markets – 3.8%** |
|  Bank of New York Mellon Corp. (The) | 100 | 4211 |
|  BlackRock, Inc. | 20 | 12918 |
|  Goldman Sachs Group, Inc. (The) | 400 | 137804 |
|  Moody's Corp. | 520 | 137732 |
|  Morgan Stanley | 2340 | 192278 |
|  MSCI, Inc. | 100 | 46886 |
|  Nasdaq, Inc. | 40 | 2490 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  S&P Global, Inc. | 680 | $| 218450 |
|  State Street Corp. | 1080 |  | 79920 |
|  |  |  | **832689** |
| **Chemicals – 1.3%** | **Chemicals – 1.3%** | **Chemicals – 1.3%** | **Chemicals – 1.3%** |
|  Ecolab, Inc. | 820 |  | 128797 |
|  International Flavors & Fragrances, Inc. | 820 |  | 80040 |
|  PPG Industries, Inc. | 760 |  | 86777 |
|  |  |  | **295614** |
| **Commercial Services & Supplies – 0.9%** | **Commercial Services & Supplies – 0.9%** | **Commercial Services & Supplies – 0.9%** | **Commercial Services & Supplies – 0.9%** |
|  Waste Management, Inc. | 1300 |  | 205881 |
| **Communications Equipment – 1.0%** | **Communications Equipment – 1.0%** | **Communications Equipment – 1.0%** | **Communications Equipment – 1.0%** |
|  Arista Networks, Inc.\* | 240 |  | 29007 |
|  Cisco Systems, Inc. | 4280 |  | 194440 |
|  |  |  | **223447** |
| **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** | **Consumer Finance – 0.1%** |
|  American Express Co. | 180 |  | 26721 |
| **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** |
|  Amcor plc | 1220 |  | 14128 |
|  International Paper Co. | 440 |  | 14788 |
|  Packaging Corp. of America | 140 |  | 16829 |
|  |  |  | **45745** |
| **Diversified Financial Services – 0.9%** | **Diversified Financial Services – 0.9%** | **Diversified Financial Services – 0.9%** | **Diversified Financial Services – 0.9%** |
|  Apollo Global Management, Inc. | 1000 |  | 55360 |
|  Berkshire Hathaway, Inc., Class B\* | 360 |  | 106232 |
|  Equitable Holdings, Inc. | 1140 |  | 34907 |
|  |  |  | **196499** |
| **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** | **Diversified Telecommunication Services – 1.5%** |
|  AT&T, Inc. | 12720 |  | 231886 |
|  Verizon Communications, Inc. | 2560 |  | 95667 |
|  |  |  | **327553** |
| **Electric Utilities – 1.0%** | **Electric Utilities – 1.0%** | **Electric Utilities – 1.0%** | **Electric Utilities – 1.0%** |
|  Edison International | 420 |  | 25217 |
|  Eversource Energy | 1100 |  | 83908 |
|  Exelon Corp. | 3060 |  | 118085 |
|  |  |  | **227210** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 311

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FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electrical Equipment – 0.3%** | **Electrical Equipment – 0.3%** | **Electrical Equipment – 0.3%** |
|  Plug Power, Inc.\* | 1580 | $25248 |
|  Rockwell Automation, Inc. | 160 | 40848 |
|  |  | **66096** |
| **Energy Equipment & Services – 1.0%** | **Energy Equipment & Services – 1.0%** | **Energy Equipment & Services – 1.0%** |
|  Baker Hughes Co. | 1120 | 30979 |
|  Halliburton Co. | 1760 | 64099 |
|  Schlumberger NV | 2280 | 118629 |
|  |  | **213707** |
| **Entertainment – 1.1%** | **Entertainment – 1.1%** | **Entertainment – 1.1%** |
|  Spotify Technology SA\* | 260 | 20951 |
|  Walt Disney Co. (The)\* | 2020 | 215211 |
|  |  | **236162** |
| **Equity Real Estate Investment Trusts (REITs) – 2.8%** | **Equity Real Estate Investment Trusts (REITs) – 2.8%** | **Equity Real Estate Investment Trusts (REITs) – 2.8%** |
|  Boston Properties, Inc. | 480 | 34896 |
|  Equinix, Inc. | 300 | 169932 |
|  Healthpeak Properties, Inc. | 1620 | 38443 |
|  Host Hotels & Resorts, Inc. | 360 | 6797 |
|  Prologis, Inc. | 2220 | 245865 |
|  Ventas, Inc. | 1140 | 44608 |
|  Weyerhaeuser Co. | 2300 | 71139 |
|  |  | **611680** |
| **Food & Staples Retailing – 1.2%** | **Food & Staples Retailing – 1.2%** | **Food & Staples Retailing – 1.2%** |
|  Kroger Co. (The) | 2120 | 100255 |
|  Walgreens Boots Alliance, Inc. | 2280 | 83220 |
|  Walmart, Inc. | 520 | 74011 |
|  |  | **257486** |
| **Food Products – 0.8%** | **Food Products – 0.8%** | **Food Products – 0.8%** |
|  General Mills, Inc. | 580 | 47317 |
|  Kellogg Co. | 820 | 62992 |
|  Mondelez International, Inc., Class A | 1140 | 70087 |
|  |  | **180396** |
| **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** |
|  Abbott Laboratories | 1560 | 154347 |
|  Boston Scientific Corp.\* | 1720 | 74149 |
|  Edwards Lifesciences Corp.\* | 300 | 21729 |
|  Medtronic plc | 1900 | 165946 |
|  |  | **416171** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Health Care Providers & Services – 4.1%** | **Health Care Providers & Services – 4.1%** | **Health Care Providers & Services – 4.1%** |
|  Cigna Corp. | 820 | $264909 |
|  CVS Health Corp. | 1640 | 155308 |
|  Elevance Health, Inc. | 520 | 284320 |
|  Humana, Inc. | 220 | 122778 |
|  UnitedHealth Group, Inc. | 160 | 88824 |
|  |  | **916139** |
| **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** |
|  Caesars Entertainment, Inc.\* | 620 | 27113 |
|  Las Vegas Sands Corp.\* | 1140 | 43331 |
|  Marriott International, Inc., Class A | 160 | 25618 |
|  McDonald's Corp. | 340 | 92704 |
|  MGM Resorts International | 1140 | 40550 |
|  Starbucks Corp. | 680 | 58881 |
|  |  | **288197** |
| **Household Products – 2.0%** | **Household Products – 2.0%** | **Household Products – 2.0%** |
|  Church & Dwight Co., Inc. | 200 | 14826 |
|  Clorox Co. (The) | 220 | 32129 |
|  Colgate-Palmolive Co. | 1780 | 131435 |
|  Kimberly-Clark Corp. | 680 | 84633 |
|  Procter & Gamble Co. (The) | 1360 | 183151 |
|  |  | **446174** |
| **Industrial Conglomerates – 0.3%** | **Industrial Conglomerates – 0.3%** | **Industrial Conglomerates – 0.3%** |
|  3M Co. | 460 | 57863 |
| **Insurance – 2.9%** | **Insurance – 2.9%** | **Insurance – 2.9%** |
|  American International Group, Inc. | 800 | 45600 |
|  Chubb Ltd. | 640 | 137530 |
|  Hartford Financial Services Group, Inc. (The) | 1020 | 73858 |
|  Marsh & McLennan Cos., Inc. | 660 | 106583 |
|  MetLife, Inc. | 2160 | 158134 |
|  Principal Financial Group, Inc. | 80 | 7050 |
|  Prudential Financial, Inc. | 820 | 86256 |
|  Travelers Cos., Inc. (The) | 180 | 33203 |
|  |  | **648214** |
| **Interactive Media & Services – 4.6%** | **Interactive Media & Services – 4.6%** | **Interactive Media & Services – 4.6%** |
|  Alphabet, Inc., Class A\* | 4800 | 453648 |
|  Alphabet, Inc., Class C\* | 4800 | 454368 |
|  Meta Platforms, Inc., Class A\* | 1200 | 111792 |
|  |  | **1019808** |

---

*See Accompanying Notes to the Financial Statements.* 

312 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Internet & Direct Marketing Retail – 3.3%** | **Internet & Direct Marketing Retail – 3.3%** | **Internet & Direct Marketing Retail – 3.3%** |
|  Amazon.com, Inc.\* | 6120 | $626933 |
|  eBay, Inc. | 1740 | 69322 |
|  Etsy, Inc.\* | 420 | 39442 |
|  |  | **735697** |
| **IT Services – 4.6%** | **IT Services – 4.6%** | **IT Services – 4.6%** |
|  Accenture plc, Class A | 140 | 39746 |
|  Akamai Technologies, Inc.\* | 500 | 44165 |
|  Automatic Data Processing, Inc. | 960 | 232032 |
|  International Business Machines Corp. | 1820 | 251688 |
|  Mastercard, Inc., Class A | 1060 | 347871 |
|  Okta, Inc.\* | 60 | 3367 |
|  Visa, Inc., Class A | 460 | 95293 |
|  |  | **1014162** |
| **Leisure Products – 0.1%** | **Leisure Products – 0.1%** | **Leisure Products – 0.1%** |
|  Hasbro, Inc. | 400 | 26100 |
| **Life Sciences Tools & Services – 1.2%** | **Life Sciences Tools & Services – 1.2%** | **Life Sciences Tools & Services – 1.2%** |
|  Agilent Technologies, Inc. | 300 | 41505 |
|  Illumina, Inc.\* | 400 | 91528 |
|  Mettler-Toledo International, Inc.\* | 20 | 25299 |
|  Repligen Corp.\* | 160 | 29198 |
|  Thermo Fisher Scientific, Inc. | 40 | 20559 |
|  West Pharmaceutical Services, Inc. | 240 | 55224 |
|  |  | **263313** |
| **Machinery – 2.3%** | **Machinery – 2.3%** | **Machinery – 2.3%** |
|  Caterpillar, Inc. | 420 | 90913 |
|  Cummins, Inc. | 440 | 107584 |
|  Deere & Co. | 360 | 142495 |
|  Illinois Tool Works, Inc. | 160 | 34165 |
|  Stanley Black & Decker, Inc. | 460 | 36106 |
|  Westinghouse Air Brake Technologies Corp. | 540 | 50371 |
|  Xylem, Inc. | 560 | 57361 |
|  |  | **518995** |
| **Media – 0.4%** | **Media – 0.4%** | **Media – 0.4%** |
|  Comcast Corp., Class A | 1760 | 55863 |
|  Interpublic Group of Cos., Inc. (The) | 560 | 16682 |
|  Omnicom Group, Inc. | 360 | 26190 |
|  |  | **98735** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Metals & Mining – 0.7%** | **Metals & Mining – 0.7%** | **Metals & Mining – 0.7%** |
|  Newmont Corp. | 2480 | $104954 |
|  Steel Dynamics, Inc. | 440 | 41382 |
|  |  | **146336** |
| **Multiline Retail – 0.6%** | **Multiline Retail – 0.6%** | **Multiline Retail – 0.6%** |
|  Target Corp. | 740 | 121545 |
| **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** |
|  Consolidated Edison, Inc. | 1120 | 98515 |
|  Dominion Energy, Inc. | 320 | 22391 |
|  Sempra Energy | 1000 | 150940 |
|  |  | **271846** |
| **Oil, Gas & Consumable Fuels – 4.1%** | **Oil, Gas & Consumable Fuels – 4.1%** | **Oil, Gas & Consumable Fuels – 4.1%** |
|  Cheniere Energy, Inc. | 640 | 112902 |
|  ConocoPhillips | 1240 | 156352 |
|  Devon Energy Corp. | 420 | 32487 |
|  Exxon Mobil Corp. | 480 | 53189 |
|  Hess Corp. | 820 | 115686 |
|  Marathon Petroleum Corp. | 1380 | 156795 |
|  Occidental Petroleum Corp. | 280 | 20328 |
|  Pioneer Natural Resources Co. | 320 | 82051 |
|  Valero Energy Corp. | 1060 | 133083 |
|  Williams Cos., Inc. (The) | 1260 | 41240 |
|  |  | **904113** |
| **Personal Products – 0.7%** | **Personal Products – 0.7%** | **Personal Products – 0.7%** |
|  Estee Lauder Cos., Inc. (The), Class A | 740 | 148363 |
| **Pharmaceuticals – 5.2%** | **Pharmaceuticals – 5.2%** | **Pharmaceuticals – 5.2%** |
|  Bristol-Myers Squibb Co. | 1880 | 145644 |
|  Eli Lilly & Co. | 120 | 43451 |
|  Johnson & Johnson | 2720 | 473198 |
|  Merck & Co., Inc. | 2160 | 218592 |
|  Pfizer, Inc. | 5600 | 260680 |
|  |  | **1141565** |
| **Professional Services – 0.5%** | **Professional Services – 0.5%** | **Professional Services – 0.5%** |
|  Equifax, Inc. | 360 | 61034 |
|  Verisk Analytics, Inc. | 260 | 47536 |
|  |  | **108570** |
| **Road & Rail – 1.6%** | **Road & Rail – 1.6%** | **Road & Rail – 1.6%** |
|  CSX Corp. | 6560 | 190633 |
|  Norfolk Southern Corp. | 680 | 155088 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 313

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  Union Pacific Corp. | 20 | $| 3943 |
|  |  |  | **349664** |
| **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** |
|  Advanced Micro Devices, Inc.\* | 560 |  | 33634 |
|  Applied Materials, Inc. | 760 |  | 67100 |
|  Enphase Energy, Inc.\* | 420 |  | 128940 |
|  First Solar, Inc.\* | 320 |  | 46582 |
|  Intel Corp. | 6500 |  | 184795 |
|  Micron Technology, Inc. | 1040 |  | 56264 |
|  NVIDIA Corp. | 2080 |  | 280738 |
|  QUALCOMM, Inc. | 420 |  | 49417 |
|  SolarEdge Technologies, Inc.\* | 180 |  | 41406 |
|  Texas Instruments, Inc. | 340 |  | 54614 |
|  |  |  | **943490** |
| **Software – 9.0%** | **Software – 9.0%** | **Software – 9.0%** | **Software – 9.0%** |
|  Adobe, Inc.\* | 700 |  | 222950 |
|  Autodesk, Inc.\* | 360 |  | 77148 |
|  Intuit, Inc. | 20 |  | 8550 |
|  Microsoft Corp. | 5000 |  | 1160650 |
|  Oracle Corp. | 1340 |  | 104614 |
|  Salesforce, Inc.\* | 1600 |  | 260144 |
|  VMware, Inc., Class A | 600 |  | 67518 |
|  Workday, Inc., Class A\* | 620 |  | 96608 |
|  |  |  | **1998182** |
| **Specialty Retail – 2.7%** | **Specialty Retail – 2.7%** | **Specialty Retail – 2.7%** | **Specialty Retail – 2.7%** |
|  Best Buy Co., Inc. | 200 |  | 13682 |
|  Home Depot, Inc. (The) | 580 |  | 171756 |
|  Lowe's Cos., Inc. | 440 |  | 85778 |
|  TJX Cos., Inc. (The) | 3360 |  | 242256 |
|  Tractor Supply Co. | 360 |  | 79117 |
|  |  |  | **592589** |
| **Technology Hardware, Storage & Peripherals – 8.0%** | **Technology Hardware, Storage & Peripherals – 8.0%** | **Technology Hardware, Storage & Peripherals – 8.0%** | **Technology Hardware, Storage & Peripherals – 8.0%** |
|  Apple, Inc. | 10260 |  | 1573268 |
|  Dell Technologies, Inc., Class C | 800 |  | 30720 |
|  Hewlett Packard Enterprise Co. | 4000 |  | 57080 |
|  HP, Inc. | 3220 |  | 88936 |
|  NetApp, Inc. | 220 |  | 15240 |
|  |  |  | **1765244** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Textiles, Apparel & Luxury Goods – 0.7%** | **Textiles, Apparel & Luxury Goods – 0.7%** | **Textiles, Apparel & Luxury Goods – 0.7%** |
|  Lululemon Athletica, Inc.\* | 80 | $26323 |
|  NIKE, Inc., Class B | 1300 | 120484 |
|  VF Corp. | 660 | 18645 |
|  |  | **165452** |
| **Trading Companies & Distributors – 0.4%** | **Trading Companies & Distributors – 0.4%** | **Trading Companies & Distributors – 0.4%** |
|  WW Grainger, Inc. | 140 | 81809 |
| **Water Utilities – 0.2%** | **Water Utilities – 0.2%** | **Water Utilities – 0.2%** |
|  American Water Works Co., Inc. | 380 | 55229 |
| **Total Common Stocks <br>(Cost $23,928,940)** | **Total Common Stocks <br>(Cost $23,928,940)** | **21921537** |
|  | Principal<br>Amount |  |
| **SHORT-TERM INVESTMENTS – 0.0%(a)** | **SHORT-TERM INVESTMENTS – 0.0%(a)** | **SHORT-TERM INVESTMENTS – 0.0%(a)** |
| **U.S. TREASURY OBLIGATIONS – 0.0%(a)** | **U.S. TREASURY OBLIGATIONS – 0.0%(a)** | **U.S. TREASURY OBLIGATIONS – 0.0%(a)** |
|  U.S. Treasury Bills 1.74%, 11/25/2022(b)<br>(Cost $14,983) | $15000 | 14967 |
| **Total Investments – 99.2% <br>(Cost $23,943,923)** | **Total Investments – 99.2% <br>(Cost $23,943,923)** | **21936504** |
|  Other assets less liabilities – 0.8% | Other assets less liabilities – 0.8% | 166881 |
| **Net Assets – 100.0%** | **Net Assets – 100.0%** | $**22103385** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(b)</sup>* *The rate shown was the current yield as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $633507 |
|  Aggregate gross unrealized depreciation | (2642469) |
|  Net unrealized depreciation | $(2008962) |
|  Federal income tax cost | $23939848 |

---

*See Accompanying Notes to the Financial Statements.* 

314 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund (cont.)

------

**Futures Contracts** 

*FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  S&P 500 Micro E-Mini Index | 8 | 12/16/2022 | USD | $155320 | $(5618) |

---

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.2% |
|  Short-Term Investments | 0.0 |
|  Others<sup>(1)</sup> | 0.8 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 315

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.4%** | **COMMON STOCKS – 99.4%** | **COMMON STOCKS – 99.4%** |
| **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** | **Air Freight & Logistics – 0.6%** |
|  Deutsche Post AG (Registered) | 2817 | $99980 |
| **Auto Components – 0.9%** | **Auto Components – 0.9%** | **Auto Components – 0.9%** |
|  Bridgestone Corp. | 1800 | 64935 |
|  Cie Generale des Etablissements Michelin SCA | 1800 | 45917 |
|  Sumitomo Electric Industries Ltd. | 4500 | 47048 |
|  |  | **157900** |
| **Automobiles – 2.1%** | **Automobiles – 2.1%** | **Automobiles – 2.1%** |
|  Bayerische Motoren Werke AG | 351 | 27586 |
|  Honda Motor Co. Ltd. | 900 | 20424 |
|  Mercedes-Benz Group AG | 864 | 50041 |
|  Porsche Automobil Holding SE (Preference) | 1026 | 57395 |
|  Toyota Motor Corp. | 15300 | 211998 |
|  |  | **367444** |
| **Banks – 11.9%** | **Banks – 11.9%** | **Banks – 11.9%** |
|  ABN AMRO Bank NV, CVA(a) | 1952 | 19208 |
|  Australia & New Zealand Banking Group Ltd. | 4923 | 80463 |
|  Banco Bilbao Vizcaya Argentaria SA | 3798 | 19553 |
|  Banco Santander SA | 21159 | 54833 |
|  Bank of Montreal | 882 | 81142 |
|  Bank of Nova Scotia (The) | 2682 | 129475 |
|  Barclays plc | 15057 | 25616 |
|  BNP Paribas SA | 3222 | 151246 |
|  Canadian Imperial Bank of Commerce | 9 | 408 |
|  Commonwealth Bank of Australia | 3096 | 207239 |
|  Credit Agricole SA | 891 | 8089 |
|  DBS Group Holdings Ltd. | 900 | 21751 |
|  HSBC Holdings plc | 27324 | 140718 |
|  ING Groep NV | 8676 | 85355 |
|  KBC Group NV | 504 | 25255 |
|  Mitsubishi UFJ Financial Group, Inc. | 22500 | 105889 |
|  Mizuho Financial Group, Inc. | 900 | 9725 |
|  National Australia Bank Ltd. | 5589 | 115865 |
|  NatWest Group plc | 9660 | 26115 |
|  Nordea Bank Abp | 1917 | 18305 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Resona Holdings, Inc. | 1800 | $| 6778 |
|  Royal Bank of Canada | 2781 |  | 256988 |
|  Skandinaviska Enskilda Banken AB, Class A | 4221 |  | 44500 |
|  Societe Generale SA | 2511 |  | 57639 |
|  Sumitomo Mitsui Trust Holdings, Inc. | 200 |  | 5755 |
|  Toronto-Dominion Bank (The) | 3483 |  | 222633 |
|  UniCredit SpA | 1746 |  | 21654 |
|  Westpac Banking Corp. | 6723 |  | 103649 |
|  |  |  | **2045846** |
| **Beverages – 2.4%** | **Beverages – 2.4%** | **Beverages – 2.4%** | **Beverages – 2.4%** |
|  Anheuser-Busch InBev SA/NV | 1350 |  | 67514 |
|  Asahi Group Holdings Ltd. | 1100 |  | 30817 |
|  Budweiser Brewing Co. APAC Ltd.(a) | 900 |  | 1894 |
|  Carlsberg A/S, Class B | 90 |  | 10610 |
|  Coca-Cola HBC AG | 1062 |  | 23263 |
|  Diageo plc | 3870 |  | 160317 |
|  Kirin Holdings Co. Ltd. | 2700 |  | 39773 |
|  Pernod Ricard SA | 288 |  | 50581 |
|  Suntory Beverage & Food Ltd. | 900 |  | 30154 |
|  |  |  | **414923** |
| **Biotechnology – 0.8%** | **Biotechnology – 0.8%** | **Biotechnology – 0.8%** | **Biotechnology – 0.8%** |
|  CSL Ltd. | 702 |  | 125906 |
|  Grifols SA\* | 1197 |  | 10181 |
|  |  |  | **136087** |
| **Building Products – 1.0%** | **Building Products – 1.0%** | **Building Products – 1.0%** | **Building Products – 1.0%** |
|  Cie de Saint-Gobain | 882 |  | 36089 |
|  Daikin Industries Ltd. | 200 |  | 30121 |
|  Geberit AG (Registered) | 117 |  | 52061 |
|  Kingspan Group plc | 1053 |  | 53182 |
|  |  |  | **171453** |
| **Capital Markets – 2.2%** | **Capital Markets – 2.2%** | **Capital Markets – 2.2%** | **Capital Markets – 2.2%** |
|  Credit Suisse Group AG (Registered) | 1251 |  | 5163 |
|  Daiwa Securities Group, Inc. | 6300 |  | 24584 |
|  Deutsche Bank AG (Registered) | 855 |  | 8163 |
|  Deutsche Boerse AG | 162 |  | 26362 |
|  EQT AB | 945 |  | 18608 |
|  Hong Kong Exchanges & Clearing Ltd. | 1300 |  | 34612 |

---

*See Accompanying Notes to the Financial Statements.* 

316 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  IGM Financial, Inc. | 225 | $| 6016 |
|  London Stock Exchange Group plc | 135 |  | 11760 |
|  Macquarie Group Ltd. | 594 |  | 64382 |
|  Nomura Holdings, Inc. | 12600 |  | 40843 |
|  St James's Place plc | 2790 |  | 34211 |
|  UBS Group AG (Registered) | 6489 |  | 103033 |
|  |  |  | **377737** |
| **Chemicals – 3.7%** | **Chemicals – 3.7%** | **Chemicals – 3.7%** | **Chemicals – 3.7%** |
|  Akzo Nobel NV | 1044 |  | 64428 |
|  Arkema SA | 171 |  | 13541 |
|  Chr Hansen Holding A/S | 504 |  | 27995 |
|  Clariant AG (Registered)\* | 1593 |  | 25644 |
|  Covestro AG(a) | 738 |  | 25121 |
|  Croda International plc | 810 |  | 63043 |
|  Givaudan SA (Registered) | 27 |  | 80669 |
|  Johnson Matthey plc | 540 |  | 12027 |
|  Koninklijke DSM NV | 648 |  | 76406 |
|  Mitsui Chemicals, Inc. | 900 |  | 16682 |
|  Nissan Chemical Corp. | 600 |  | 27046 |
|  Novozymes A/S, Class B | 603 |  | 31677 |
|  Nutrien Ltd. | 756 |  | 63798 |
|  Shin-Etsu Chemical Co. Ltd. | 200 |  | 20910 |
|  Sika AG (Registered) | 270 |  | 60920 |
|  Sumitomo Chemical Co. Ltd. | 5400 |  | 18202 |
|  Umicore SA | 162 |  | 5340 |
|  Wacker Chemie AG | 27 |  | 3146 |
|  |  |  | **636595** |
| **Commercial Services & Supplies – 0.4%** | **Commercial Services & Supplies – 0.4%** | **Commercial Services & Supplies – 0.4%** | **Commercial Services & Supplies – 0.4%** |
|  Brambles Ltd. | 5652 |  | 42214 |
|  Dai Nippon Printing Co. Ltd. | 1000 |  | 20069 |
|  |  |  | **62283** |
| **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** |
|  Nokia OYJ | 8730 |  | 38888 |
| **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** |
|  Taisei Corp. | 900 |  | 24554 |
|  WSP Global, Inc. | 297 |  | 36457 |
|  |  |  | **61011** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** |
|  SIG Group AG\* | 2061 | $39624 |
| **Diversified Financial Services – 0.3%** | **Diversified Financial Services – 0.3%** | **Diversified Financial Services – 0.3%** |
|  M&G plc | 18315 | 36944 |
|  ORIX Corp. | 900 | 13231 |
|  |  | **50175** |
| **Diversified Telecommunication Services – 2.7%** | **Diversified Telecommunication Services – 2.7%** | **Diversified Telecommunication Services – 2.7%** |
|  BCE, Inc. | 1152 | 51955 |
|  Deutsche Telekom AG (Registered) | 7479 | 141658 |
|  Koninklijke KPN NV | 7587 | 21229 |
|  Nippon Telegraph & Telephone Corp. | 1600 | 44070 |
|  Singapore Telecommunications Ltd. | 16200 | 28620 |
|  Swisscom AG (Registered) | 153 | 75571 |
|  Telecom Italia SpA\* | 18 | 4 |
|  Telefonica Deutschland Holding AG | 4761 | 10380 |
|  Telefonica SA | 6291 | 21669 |
|  Telia Co. AB | 2682 | 7099 |
|  TELUS Corp. | 2610 | 54437 |
|  |  | **456692** |
| **Electric Utilities – 2.0%** | **Electric Utilities – 2.0%** | **Electric Utilities – 2.0%** |
|  Acciona SA | 54 | 9719 |
|  Electricite de France SA | 972 | 11480 |
|  Hydro One Ltd.(a) | 954 | 23891 |
|  Iberdrola SA | 11844 | 120279 |
|  Orsted A/S(a) | 1071 | 88353 |
|  Terna – Rete Elettrica Nazionale | 8397 | 55671 |
|  Verbund AG | 387 | 30312 |
|  |  | **339705** |
| **Electrical Equipment – 2.2%** | **Electrical Equipment – 2.2%** | **Electrical Equipment – 2.2%** |
|  ABB Ltd. (Registered) | 9 | 250 |
|  Mitsubishi Electric Corp. | 2700 | 23797 |
|  Schneider Electric SE | 1539 | 195092 |
|  Siemens Gamesa Renewable Energy SA\* | 1818 | 32271 |
|  Vestas Wind Systems A/S | 6219 | 122522 |
|  |  | **373932** |
| **Electronic Equipment, Instruments & Components – 0.6%** | **Electronic Equipment, Instruments & Components – 0.6%** | **Electronic Equipment, Instruments & Components – 0.6%** |
|  Halma plc | 54 | 1315 |
|  Murata Manufacturing Co. Ltd. | 900 | 44202 |
|  Omron Corp. | 1100 | 51479 |
|  |  | **96996** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 317

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** |
|  Tenaris SA | 585 | $9080 |
| **Entertainment – 0.1%** | **Entertainment – 0.1%** | **Entertainment – 0.1%** |
|  Nintendo Co. Ltd. | 400 | 16335 |
| **Equity Real Estate Investment Trusts (REITs) – 1.5%** | **Equity Real Estate Investment Trusts (REITs) – 1.5%** | **Equity Real Estate Investment Trusts (REITs) – 1.5%** |
|  British Land Co. plc (The) | 2709 | 11413 |
|  Dexus | 5328 | 26438 |
|  Gecina SA | 198 | 17661 |
|  GPT Group (The) | 13968 | 38496 |
|  Japan Real Estate Investment Corp. | 9 | 37723 |
|  Land Securities Group plc | 1062 | 6975 |
|  Mirvac Group | 11007 | 14570 |
|  Nippon Prologis REIT, Inc. | 9 | 18862 |
|  Segro plc | 5103 | 46121 |
|  Stockland | 792 | 1823 |
|  Unibail-Rodamco-Westfield\* | 270 | 12777 |
|  Vicinity Ltd. | 21348 | 26551 |
|  |  | **259410** |
| **Food & Staples Retailing – 2.1%** | **Food & Staples Retailing – 2.1%** | **Food & Staples Retailing – 2.1%** |
|  Aeon Co. Ltd. | 1800 | 33624 |
|  Carrefour SA | 1386 | 22308 |
|  Jeronimo Martins SGPS SA | 1071 | 22208 |
|  Loblaw Cos. Ltd. | 495 | 40506 |
|  Metro, Inc. | 288 | 15069 |
|  Tesco plc | 42417 | 105048 |
|  Woolworths Group Ltd. | 5463 | 115349 |
|  |  | **354112** |
| **Food Products – 2.5%** | **Food Products – 2.5%** | **Food Products – 2.5%** |
|  Nestle SA (Registered) | 3708 | 404016 |
|  Orkla ASA | 3348 | 22593 |
|  |  | **426609** |
| **Gas Utilities – 0.4%** | **Gas Utilities – 0.4%** | **Gas Utilities – 0.4%** |
|  AltaGas Ltd. | 918 | 16536 |
|  Enagas SA | 765 | 12419 |
|  Hong Kong & China Gas Co. Ltd. | 63000 | 48635 |
|  |  | **77590** |
| **Health Care Equipment & Supplies – 2.1%** | **Health Care Equipment & Supplies – 2.1%** | **Health Care Equipment & Supplies – 2.1%** |
|  Coloplast A/S, Class B | 261 | 29106 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** | **Health Care Equipment & Supplies – (continued)** |
|  Fisher & Paykel Healthcare Corp. Ltd. | 1656 | $| 18837 |
|  Koninklijke Philips NV | 5760 |  | 72972 |
|  Olympus Corp. | 2700 |  | 57039 |
|  Siemens Healthineers AG(a) | 657 |  | 30246 |
|  Sonova Holding AG (Registered) | 342 |  | 80891 |
|  Sysmex Corp. | 900 |  | 48610 |
|  Terumo Corp. | 900 |  | 27393 |
|  |  |  | **365094** |
| **Hotels, Restaurants & Leisure – 0.6%** | **Hotels, Restaurants & Leisure – 0.6%** | **Hotels, Restaurants & Leisure – 0.6%** | **Hotels, Restaurants & Leisure – 0.6%** |
|  Genting Singapore Ltd. | 39600 |  | 22527 |
|  Oriental Land Co. Ltd. | 200 |  | 26844 |
|  Sands China Ltd.\* | 14400 |  | 25132 |
|  Whitbread plc | 963 |  | 28517 |
|  |  |  | **103020** |
| **Household Durables – 1.2%** | **Household Durables – 1.2%** | **Household Durables – 1.2%** | **Household Durables – 1.2%** |
|  Barratt Developments plc | 828 |  | 3586 |
|  Berkeley Group Holdings plc | 198 |  | 7913 |
|  Sekisui House Ltd. | 2700 |  | 44959 |
|  Sony Group Corp. | 2200 |  | 147836 |
|  |  |  | **204294** |
| **Household Products – 0.6%** | **Household Products – 0.6%** | **Household Products – 0.6%** | **Household Products – 0.6%** |
|  Henkel AG & Co. KGaA (Preference) | 1017 |  | 64109 |
|  Reckitt Benckiser Group plc | 603 |  | 40128 |
|  |  |  | **104237** |
| **Independent Power and Renewable Electricity<br>Producers – 0.2%** | **Independent Power and Renewable Electricity<br>Producers – 0.2%** | **Independent Power and Renewable Electricity<br>Producers – 0.2%** | **Independent Power and Renewable Electricity<br>Producers – 0.2%** |
|  EDP Renovaveis SA | 1656 |  | 34878 |
| **Industrial Conglomerates – 1.7%** | **Industrial Conglomerates – 1.7%** | **Industrial Conglomerates – 1.7%** | **Industrial Conglomerates – 1.7%** |
|  Hitachi Ltd. | 3900 |  | 177374 |
|  Siemens AG (Registered) | 1098 |  | 120067 |
|  |  |  | **297441** |
| **Insurance – 6.1%** | **Insurance – 6.1%** | **Insurance – 6.1%** | **Insurance – 6.1%** |
|  AIA Group Ltd. | 16200 |  | 122689 |
|  Allianz SE (Registered) | 927 |  | 166932 |
|  ASR Nederland NV | 495 |  | 21815 |
|  Aviva plc | 15768 |  | 75904 |
|  AXA SA | 5769 |  | 142545 |
|  Dai-ichi Life Holdings, Inc. | 100 |  | 1586 |

---

*See Accompanying Notes to the Financial Statements.* 

318 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Insurance Australia Group Ltd. | 5859 | $| 18358 |
|  Japan Post Insurance Co. Ltd. | 900 |  | 13303 |
|  Legal & General Group plc | 35892 |  | 96244 |
|  MS&AD Insurance Group Holdings, Inc. | 2500 |  | 66286 |
|  Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | 180 |  | 47571 |
|  NN Group NV | 1081 |  | 45781 |
|  QBE Insurance Group Ltd. | 2619 |  | 20499 |
|  Sun Life Financial, Inc. | 1854 |  | 78643 |
|  Swiss Re AG | 108 |  | 8029 |
|  Zurich Insurance Group AG | 297 |  | 126813 |
|  |  |  | **1052998** |
| **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** |
|  Z Holdings Corp. | 15300 |  | 39589 |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  Rakuten Group, Inc. | 6300 |  | 28229 |
|  Zalando SE\* (a) | 1026 |  | 23658 |
|  |  |  | **51887** |
| **IT Services – 2.4%** | **IT Services – 2.4%** | **IT Services – 2.4%** | **IT Services – 2.4%** |
|  Capgemini SE | 918 |  | 150840 |
|  CGI, Inc.\* | 135 |  | 10861 |
|  Fujitsu Ltd. | 1200 |  | 138258 |
|  Nomura Research Institute Ltd. | 1800 |  | 40024 |
|  Worldline SA\* (a) | 1593 |  | 69779 |
|  |  |  | **409762** |
| **Leisure Products – 0.2%** | **Leisure Products – 0.2%** | **Leisure Products – 0.2%** | **Leisure Products – 0.2%** |
|  Yamaha Corp. | 900 |  | 34030 |
| **Machinery – 1.9%** | **Machinery – 1.9%** | **Machinery – 1.9%** | **Machinery – 1.9%** |
|  Alstom SA | 2259 |  | 46574 |
|  Atlas Copco AB, Class A | 3105 |  | 33167 |
|  Epiroc AB, Class A | 1449 |  | 22167 |
|  GEA Group AG | 711 |  | 24876 |
|  Hitachi Construction Machinery Co. Ltd. | 900 |  | 17645 |
|  Husqvarna AB, Class B | 1431 |  | 8495 |
|  KION Group AG | 612 |  | 13591 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Komatsu Ltd. | 2700 | $| 51735 |
|  Kone OYJ, Class B | 99 |  | 4056 |
|  Kubota Corp. | 900 |  | 12573 |
|  SKF AB, Class B | 1530 |  | 22125 |
|  Volvo AB, Class B | 2349 |  | 38433 |
|  Yaskawa Electric Corp. | 900 |  | 25008 |
|  |  |  | **320445** |
| **Media – 1.2%** | **Media – 1.2%** | **Media – 1.2%** | **Media – 1.2%** |
|  Dentsu Group, Inc. | 1200 |  | 37421 |
|  Informa plc | 3114 |  | 19920 |
|  Pearson plc | 2574 |  | 28462 |
|  Publicis Groupe SA | 1080 |  | 60565 |
|  WPP plc | 6660 |  | 58737 |
|  |  |  | **205105** |
| **Metals & Mining – 2.7%** | **Metals & Mining – 2.7%** | **Metals & Mining – 2.7%** | **Metals & Mining – 2.7%** |
|  Anglo American plc | 360 |  | 10812 |
|  BlueScope Steel Ltd. | 1269 |  | 12764 |
|  Fortescue Metals Group Ltd. | 7542 |  | 70894 |
|  Fresnillo plc | 1890 |  | 15863 |
|  Glencore plc | 1467 |  | 8437 |
|  Hitachi Metals Ltd.\* | 1000 |  | 14613 |
|  Kinross Gold Corp. | 9612 |  | 34811 |
|  Newcrest Mining Ltd. | 3447 |  | 38243 |
|  Norsk Hydro ASA | 4248 |  | 26959 |
|  Rio Tinto Ltd. | 882 |  | 49744 |
|  Rio Tinto plc | 1116 |  | 58296 |
|  Sumitomo Metal Mining Co. Ltd. | 200 |  | 5627 |
|  Teck Resources Ltd., Class B | 2718 |  | 82633 |
|  Wheaton Precious Metals Corp. | 891 |  | 29113 |
|  |  |  | **458809** |
| **Multiline Retail – 0.4%** | **Multiline Retail – 0.4%** | **Multiline Retail – 0.4%** | **Multiline Retail – 0.4%** |
|  Canadian Tire Corp. Ltd., Class A | 333 |  | 37276 |
|  Next plc | 666 |  | 37795 |
|  |  |  | **75071** |
| **Multi-Utilities – 0.2%** | **Multi-Utilities – 0.2%** | **Multi-Utilities – 0.2%** | **Multi-Utilities – 0.2%** |
|  National Grid plc | 2988 |  | 32627 |
| **Oil, Gas & Consumable Fuels – 6.4%** | **Oil, Gas & Consumable Fuels – 6.4%** | **Oil, Gas & Consumable Fuels – 6.4%** | **Oil, Gas & Consumable Fuels – 6.4%** |
|  Ampol Ltd. | 1152 |  | 20059 |
|  Enbridge, Inc. | 5949 |  | 231497 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 319

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  ENEOS Holdings, Inc. | 12600 | $| 41521 |
|  Eni SpA | 3870 |  | 50695 |
|  Neste OYJ | 2583 |  | 113196 |
|  Pembina Pipeline Corp. | 2700 |  | 89033 |
|  Repsol SA | 4113 |  | 55875 |
|  Shell plc | 11736 |  | 324834 |
|  TC Energy Corp. | 162 |  | 7107 |
|  TotalEnergies SE | 2619 |  | 142626 |
|  Tourmaline Oil Corp. | 297 |  | 16713 |
|  Woodside Energy Group Ltd. | 1 |  | 22 |
|  |  |  | **1093178** |
| **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** |
|  Mondi plc | 3330 |  | 56072 |
|  Stora Enso OYJ, Class R | 72 |  | 939 |
|  UPM-Kymmene OYJ | 1107 |  | 37101 |
|  |  |  | **94112** |
| **Personal Products – 2.3%** | **Personal Products – 2.3%** | **Personal Products – 2.3%** | **Personal Products – 2.3%** |
|  Kao Corp. | 2700 |  | 101544 |
|  L'Oreal SA | 558 |  | 175432 |
|  Unilever plc | 2412 |  | 110374 |
|  |  |  | **387350** |
| **Pharmaceuticals – 9.5%** | **Pharmaceuticals – 9.5%** | **Pharmaceuticals – 9.5%** | **Pharmaceuticals – 9.5%** |
|  AstraZeneca plc | 2196 |  | 259258 |
|  Daiichi Sankyo Co. Ltd. | 3600 |  | 115459 |
|  Eisai Co. Ltd. | 100 |  | 6038 |
|  GSK plc | 6570 |  | 108080 |
|  Kyowa Kirin Co. Ltd. | 900 |  | 21223 |
|  Merck KGaA | 171 |  | 27886 |
|  Novartis AG (Registered) | 2268 |  | 183344 |
|  Novo Nordisk A/S, Class B | 2583 |  | 280879 |
|  Ono Pharmaceutical Co. Ltd. | 1900 |  | 44689 |
|  Roche Holding AG | 972 |  | 322996 |
|  Sanofi | 1719 |  | 148371 |
|  Takeda Pharmaceutical Co. Ltd. | 3700 |  | 97532 |
|  UCB SA | 216 |  | 16293 |
|  |  |  | **1632048** |
| **Professional Services – 2.3%** | **Professional Services – 2.3%** | **Professional Services – 2.3%** | **Professional Services – 2.3%** |
|  Adecco Group AG (Registered) | 702 |  | 21984 |
|  Experian plc | 828 |  | 26445 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** | **Professional Services – (continued)** |
|  Randstad NV | 558 | $| 27818 |
|  Recruit Holdings Co. Ltd. | 2100 |  | 64850 |
|  RELX plc | 7515 |  | 202553 |
|  Wolters Kluwer NV | 550 |  | 58463 |
|  |  |  | **402113** |
| **Real Estate Management & Development – 0.6%** | **Real Estate Management & Development – 0.6%** | **Real Estate Management & Development – 0.6%** | **Real Estate Management & Development – 0.6%** |
|  City Developments Ltd. | 2700 |  | 14558 |
|  Daiwa House Industry Co. Ltd. | 3600 |  | 72952 |
|  New World Development Co. Ltd. | 9000 |  | 18413 |
|  |  |  | **105923** |
| **Road & Rail – 2.5%** | **Road & Rail – 2.5%** | **Road & Rail – 2.5%** | **Road & Rail – 2.5%** |
|  Canadian National Railway Co. | 1332 |  | 157608 |
|  Canadian Pacific Railway Ltd. | 1296 |  | 96493 |
|  Central Japan Railway Co. | 300 |  | 34847 |
|  East Japan Railway Co. | 1800 |  | 97366 |
|  MTR Corp. Ltd. | 6500 |  | 28609 |
|  West Japan Railway Co. | 300 |  | 11910 |
|  |  |  | **426833** |
| **Semiconductors & Semiconductor Equipment – 1.9%** | **Semiconductors & Semiconductor Equipment – 1.9%** | **Semiconductors & Semiconductor Equipment – 1.9%** | **Semiconductors & Semiconductor Equipment – 1.9%** |
|  Advantest Corp. | 700 |  | 37017 |
|  ASML Holding NV | 531 |  | 250861 |
|  STMicroelectronics NV | 432 |  | 13492 |
|  Tokyo Electron Ltd. | 100 |  | 26568 |
|  |  |  | **327938** |
| **Software – 2.2%** | **Software – 2.2%** | **Software – 2.2%** | **Software – 2.2%** |
|  Open Text Corp. | 1836 |  | 53113 |
|  SAP SE | 2763 |  | 266718 |
|  WiseTech Global Ltd. | 198 |  | 7364 |
|  Xero Ltd.\* | 918 |  | 45828 |
|  |  |  | **373023** |
| **Specialty Retail – 1.1%** | **Specialty Retail – 1.1%** | **Specialty Retail – 1.1%** | **Specialty Retail – 1.1%** |
|  Chow Tai Fook Jewellery Group Ltd. | 3600 |  | 6164 |
|  H & M Hennes & Mauritz AB, Class B | 2619 |  | 26355 |
|  Industria de Diseno Textil SA | 6183 |  | 140185 |
|  Kingfisher plc | 9171 |  | 23114 |
|  |  |  | **195818** |
| **Technology Hardware, Storage & Peripherals – 1.0%** | **Technology Hardware, Storage & Peripherals – 1.0%** | **Technology Hardware, Storage & Peripherals – 1.0%** | **Technology Hardware, Storage & Peripherals – 1.0%** |
|  Canon, Inc. | 5500 |  | 116709 |

---

*See Accompanying Notes to the Financial Statements.* 

320 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** |
|  Ricoh Co. Ltd. | 3600 | $26400 |
|  Seiko Epson Corp. | 1800 | 24535 |
|  |  | **167644** |
| **Textiles, Apparel & Luxury Goods – 2.6%** | **Textiles, Apparel & Luxury Goods – 2.6%** | **Textiles, Apparel & Luxury Goods – 2.6%** |
|  adidas AG | 198 | 19370 |
|  Burberry Group plc | 1773 | 37050 |
|  Cie Financiere Richemont SA (Registered) | 765 | 74868 |
|  Kering SA | 279 | 127865 |
|  LVMH Moet Hennessy Louis Vuitton SE | 306 | 193256 |
|  |  | **452409** |
| **Trading Companies & Distributors – 0.9%** | **Trading Companies & Distributors – 0.9%** | **Trading Companies & Distributors – 0.9%** |
|  Ferguson plc | 243 | 26607 |
|  ITOCHU Corp. | 4500 | 116530 |
|  Rexel SA | 864 | 15461 |
|  |  | **158598** |
| **Transportation Infrastructure – 1.2%** | **Transportation Infrastructure – 1.2%** | **Transportation Infrastructure – 1.2%** |
|  Atlantia SpA | 1494 | 33341 |
|  Getlink SE | 2574 | 40781 |
|  Transurban Group | 14913 | 126449 |
|  |  | **200571** |
| **Water Utilities – 0.2%** | **Water Utilities – 0.2%** | **Water Utilities – 0.2%** |
|  Severn Trent plc | 576 | 16599 |
|  United Utilities Group plc | 990 | 10708 |
|  |  | **27307** |
| **Wireless Telecommunication Services – 0.9%** | **Wireless Telecommunication Services – 0.9%** | **Wireless Telecommunication Services – 0.9%** |
|  Rogers Communications, Inc., Class B | 216 | 8980 |
|  SoftBank Corp. | 9000 | 88737 |
|  Vodafone Group plc | 49383 | 57790 |
|  |  | **155507** |
| **TOTAL COMMON STOCKS <br>(Cost $20,549,885)** | **TOTAL COMMON STOCKS <br>(Cost $20,549,885)** | **17060066** |
| **Total Investments – 99.4% <br>(Cost $20,549,885)** | **Total Investments – 99.4% <br>(Cost $20,549,885)** | **17060066** |
|  Other assets less liabilities – 0.6% |  | 108854 |
| **Net Assets – 100.0%** | **Net Assets – 100.0%** | $**17168920** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*CVA – Dutch Certification* 

*OYJ – Public Limited Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*SCA – Limited partnership with share capital* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $93375 |
|  Aggregate gross unrealized depreciation | (3618206) |
|  Net unrealized depreciation | $(3524831) |
|  Federal income tax cost | $20582911 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 321

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

**Futures Contracts** 

*FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund had the following open futures contract as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI EAFE E-Mini Index | 1 | 12/16/2022 | USD | $87795 | $(4776) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  AUD | 25994 | JPMorgan Chase Bank | USD | 16383 | 12/21/2022 | $266 |
|  GBP | 11280 | Citibank NA | USD | 12923 | 12/21/2022 | 87 |
|  GBP | 11094 | JPMorgan Chase Bank | USD | 12506 | 12/21/2022 | 289 |
|  USD | 26247 | Morgan Stanley | AUD | 39202 | 12/21/2022 | 1138 |
|  USD | 8791 | Citibank NA | CAD | 11674 | 12/21/2022 | 228 |
|  USD | 20390 | Citibank NA | CHF | 19548 | 12/21/2022 | 735 |
|  USD | 7613 | Morgan Stanley | DKK | 56285 | 12/21/2022 | 108 |
|  USD | 7028 | Goldman Sachs & Co. | HKD | 55077 | 12/21/2022 | 7 |
|  USD | 2509 | BNP Paribas SA | ILS | 8590 | 12/21/2022 | 58 |
|  USD | 3735 | Bank of New York | JPY | 529800 | 12/21/2022 | 147 |
|  USD | 17436 | Citibank NA | JPY | 2500569 | 12/21/2022 | 503 |
|  USD | 299 | Citibank NA | NZD | 502 | 12/21/2022 | 7 |
|  USD | 4769 | Morgan Stanley | SEK | 51285 | 12/21/2022 | 108 |
|  USD | 7511 | JPMorgan Chase Bank | SGD | 10575 | 12/21/2022 | 36 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $3717 |
|  CAD | 2016 | Toronto-Dominion Bank (The) | USD | 1515 | 12/21/2022 | $(36) |
|  EUR | 84 | Morgan Stanley | USD | 85 | 12/21/2022 | (1) |
|  JPY | 1385996 | Citibank NA | USD | 9790 | 12/21/2022 | (404) |
|  NOK | 23302 | Morgan Stanley | USD | 2268 | 12/21/2022 | (22) |
|  USD | 7692 | Bank of Montreal | EUR | 7816 | 12/21/2022 | (65) |
|  USD | 22929 | Bank of New York | GBP | 20101 | 12/21/2022 | (255) |
|  USD | 16753 | Bank of Montreal | JPY | 2495187 | 12/21/2022 | (144) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(927) |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | $2790 |

---

*See Accompanying Notes to the Financial Statements.* 

322 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (cont.)

------

*Abbreviations:* 

*AUD – Australian Dollar* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*DKK – Danish Krone* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*ILS – Israeli Shekel* 

*JPY – Japanese Yen* 

*NOK – Norwegian Krone* 

*NZD – New Zealand Dollar* 

*SEK – Swedish Krona* 

*SGD – Singapore Dollar* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.4% |
|  Others<sup>(1)</sup> | 0.6 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 323

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.9%** | **COMMON STOCKS – 98.9%** | **COMMON STOCKS – 98.9%** |
| **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** |
|  Hyundai Glovis Co. Ltd. | 64 | $7818 |
|  ZTO Express Cayman, Inc., ADR | 520 | 8783 |
|  |  | **16601** |
| **Airlines – 0.1%** |  |  |
|  Korean Air Lines Co. Ltd.\* | 142 | 2303 |
| **Auto Components – 0.5%** | **Auto Components – 0.5%** | **Auto Components – 0.5%** |
|  Hankook Tire & Technology Co. Ltd. | 276 | 7082 |
|  Hanon Systems | 558 | 3056 |
|  Hyundai Mobis Co. Ltd. | 54 | 8302 |
|  |  | **18440** |
| **Automobiles – 1.3%** |  |  |
|  Hero MotoCorp Ltd. | 380 | 12288 |
|  Li Auto, Inc., ADR\* | 656 | 8935 |
|  Mahindra & Mahindra Ltd. | 368 | 5995 |
|  NIO, Inc., ADR\* | 1624 | 15704 |
|  XPeng, Inc., Class A\* | 2200 | 7119 |
|  |  | **50041** |
| **Banks – 17.8%** |  |  |
|  Agricultural Bank of China Ltd., Class H | 49000 | 13982 |
|  Akbank TAS | 10592 | 8324 |
|  Al Rajhi Bank\* | 270 | 6122 |
|  Alinma Bank | 2090 | 20858 |
|  Axis Bank Ltd. | 1512 | 16549 |
|  Banco Bradesco SA\* | 5000 | 15856 |
|  Banco Bradesco SA (Preference) | 10600 | 40119 |
|  Banco do Brasil SA | 1800 | 12699 |
|  Bancolombia SA | 918 | 6674 |
|  Bancolombia SA (Preference) | 1498 | 9587 |
|  Bank AlBilad\* | 1764 | 23801 |
|  Bank Al-Jazira | 158 | 983 |
|  Bank of the Philippine Islands | 4020 | 6660 |
|  Bank Polska Kasa Opieki SA | 110 | 1808 |
|  Bank Rakyat Indonesia Persero Tbk. PT | 89400 | 26652 |
|  Banque Saudi Fransi | 332 | 3817 |
|  China Construction Bank Corp., Class H | 86000 | 45685 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** |  |  |  |
|  CIMB Group Holdings Bhd. | 14713 | $| 17178 |
|  Commercial International Bank Egypt SAE | 8921 |  | 11969 |
|  CTBC Financial Holding Co. Ltd. | 54000 |  | 34187 |
|  E.Sun Financial Holding Co. Ltd. | 46000 |  | 33120 |
|  First Abu Dhabi Bank PJSC | 9484 |  | 46219 |
|  First Financial Holding Co. Ltd. | 36000 |  | 27652 |
|  Grupo Financiero Banorte SAB de CV, Class O | 600 |  | 4868 |
|  Industrial & Commercial Bank of China Ltd., Class H | 68000 |  | 29539 |
|  Itau Unibanco Holding SA (Preference)\* | 2600 |  | 15063 |
|  KB Financial Group, Inc. | 1042 |  | 35149 |
|  Mega Financial Holding Co. Ltd. | 36900 |  | 34240 |
|  Nedbank Group Ltd. | 1654 |  | 19581 |
|  OTP Bank Nyrt. | 790 |  | 17193 |
|  Santander Bank Polska SA | 118 |  | 6287 |
|  Shinhan Financial Group Co. Ltd. | 1068 |  | 27216 |
|  SinoPac Financial Holdings Co. Ltd. | 6040 |  | 3018 |
|  Standard Bank Group Ltd. | 3768 |  | 35194 |
|  State Bank of India | 1822 |  | 12630 |
|  Turkiye Is Bankasi A/S, Class C | 12320 |  | 6172 |
|  Yapi ve Kredi Bankasi A/S | 9676 |  | 4790 |
|  Yes Bank Ltd.\* | 39544 |  | 7429 |
|  |  |  | **688870** |
| **Beverages – 0.6%** |  |  |  |
|  Coca-Cola Femsa SAB de CV | 1800 |  | 11318 |
|  United Spirits Ltd.\* | 1056 |  | 11435 |
|  |  |  | **22753** |
| **Biotechnology – 0.4%** |  |  |  |
|  BeiGene Ltd.\* | 1200 |  | 15134 |
| **Capital Markets – 0.6%** | **Capital Markets – 0.6%** | **Capital Markets – 0.6%** | **Capital Markets – 0.6%** |
|  B3 SA – Brasil Bolsa Balcao | 3400 |  | 9745 |
|  Mirae Asset Securities Co. Ltd. | 1014 |  | 4520 |
|  Saudi Tadawul Group Holding Co. | 128 |  | 7399 |
|  |  |  | **21664** |

---

*See Accompanying Notes to the Financial Statements.* 

324 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Chemicals – 3.7%** | **Chemicals – 3.7%** | **Chemicals – 3.7%** |
|  Asian Paints Ltd. | 1068 | $40096 |
|  Indorama Ventures PCL, NVDR | 5800 | 6401 |
|  LG Chem Ltd. | 56 | 24610 |
|  Orbia Advance Corp. SAB de CV | 3400 | 5730 |
|  PI Industries Ltd. | 56 | 2193 |
|  PTT Global Chemical PCL, NVDR | 7800 | 8915 |
|  SABIC Agri-Nutrients Co. | 68 | 2877 |
|  Sahara International Petrochemical Co. | 1284 | 13856 |
|  Sociedad Quimica y Minera de Chile SA (Preference), Class B | 308 | 29305 |
|  Yanbu National Petrochemical Co. | 916 | 10897 |
|  |  | **144880** |
| **Commercial Services & Supplies – 0.0%(a)** | **Commercial Services & Supplies – 0.0%(a)** | **Commercial Services & Supplies – 0.0%(a)** |
|  China Everbright Environment Group Ltd. | 4000 | 1330 |
| **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** | **Construction & Engineering – 0.4%** |
|  Hyundai Engineering & Construction Co. Ltd. | 276 | 6762 |
|  Samsung Engineering Co. Ltd.\* | 422 | 7066 |
|  |  | **13828** |
| **Construction Materials – 0.9%** |  |  |
|  Siam Cement PCL (The), NVDR | 2800 | 23836 |
|  UltraTech Cement Ltd. | 122 | 9897 |
|  |  | **33733** |
| **Consumer Finance – 0.0%(a)** | **Consumer Finance – 0.0%(a)** | **Consumer Finance – 0.0%(a)** |
|  Bajaj Finance Ltd. | 12 | 1036 |
| **Containers & Packaging – 0.4%** | **Containers & Packaging – 0.4%** | **Containers & Packaging – 0.4%** |
|  Klabin SA | 2400 | 9889 |
|  SCG Packaging PCL, NVDR | 4800 | 6558 |
|  |  | **16447** |
| **Diversified Financial Services – 1.9%** | **Diversified Financial Services – 1.9%** | **Diversified Financial Services – 1.9%** |
|  FirstRand Ltd. | 9900 | 34666 |
|  Housing Development Finance Corp. Ltd. | 536 | 15992 |
|  Yuanta Financial Holding Co. Ltd. | 39140 | 23929 |
|  |  | **74587** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Diversified Telecommunication Services – 1.4%** | **Diversified Telecommunication Services – 1.4%** | **Diversified Telecommunication Services – 1.4%** |
|  Chunghwa Telecom Co. Ltd. | 5000 | $17224 |
|  Hellenic Telecommunications Organization SA | 712 | 11189 |
|  LG Uplus Corp. | 638 | 5128 |
|  Saudi Telecom Co. | 460 | 4946 |
|  Telefonica Brasil SA | 1800 | 14171 |
|  |  | **52658** |
| **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** |
|  Adani Transmission Ltd.\* | 44 | 1780 |
|  Centrais Eletricas Brasileiras SA | 1600 | 15191 |
|  Centrais Eletricas Brasileiras SA (Preference), Class B | 900 | 9145 |
|  CEZ A/S | 114 | 3728 |
|  Cia Energetica de Minas Gerais | 1000 | 3295 |
|  Cia Energetica de Minas Gerais (Preference) | 5000 | 10834 |
|  Cia Paranaense de Energia (Preference) | 5800 | 8180 |
|  Power Grid Corp. of India Ltd. | 1062 | 2927 |
|  |  | **55080** |
| **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** | **Electrical Equipment – 0.8%** |
|  CG Power & Industrial Solutions Ltd.\* | 2020 | 6345 |
|  Doosan Enerbility Co. Ltd.\* | 120 | 1116 |
|  Havells India Ltd. | 884 | 12989 |
|  Xinjiang Goldwind Science & Technology Co. Ltd., Class H | 2800 | 2429 |
|  Zhuzhou CRRC Times Electric Co. Ltd., Class H | 2000 | 8675 |
|  |  | **31554** |
| **Electronic Equipment, Instruments & Components – 2.1%** | **Electronic Equipment, Instruments & Components – 2.1%** | **Electronic Equipment, Instruments & Components – 2.1%** |
|  AUO Corp. | 19200 | 10070 |
|  Delta Electronics Thailand PCL, NVDR | 800 | 12191 |
|  Delta Electronics, Inc. | 5000 | 39957 |
|  Hon Hai Precision Industry Co. Ltd. | 3000 | 9543 |
|  Samsung SDI Co. Ltd. | 18 | 9313 |
|  |  | **81074** |
| **Energy Equipment & Services – 0.0%(a)** | **Energy Equipment & Services – 0.0%(a)** | **Energy Equipment & Services – 0.0%(a)** |
|  Dialog Group Bhd. | 3000 | 1307 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 325

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Entertainment – 0.6%** | **Entertainment – 0.6%** | **Entertainment – 0.6%** |
|  Kingsoft Corp. Ltd. | 3200 | $9681 |
|  NetEase, Inc., ADR | 206 | 11458 |
|  |  | **21139** |
| **Food & Staples Retailing – 2.3%** |  |  |
|  CP ALL PCL, NVDR | 13000 | 20494 |
|  Ghitha Holding PJSC\* | 44 | 838 |
|  Nahdi Medical Co. | 20 | 1054 |
|  Shoprite Holdings Ltd. | 1138 | 14484 |
|  Sun Art Retail Group Ltd. | 7000 | 1115 |
|  Wal-Mart de Mexico SAB de CV | 13000 | 50123 |
|  |  | **88108** |
| **Food Products – 1.2%** |  |  |
|  Almarai Co. JSC | 58 | 869 |
|  Charoen Pokphand Foods PCL, NVDR | 6200 | 4113 |
|  CJ CheilJedang Corp. | 28 | 8138 |
|  Grupo Bimbo SAB de CV, Series A | 2000 | 7729 |
|  Marico Ltd. | 1836 | 11635 |
|  Nestle India Ltd. | 28 | 6888 |
|  Nestle Malaysia Bhd. | 300 | 8439 |
|  |  | **47811** |
| **Gas Utilities – 0.4%** |  |  |
|  ENN Energy Holdings Ltd. | 1400 | 13920 |
|  GAIL India Ltd. | 2931 | 3233 |
|  |  | **17153** |
| **Health Care Equipment & Supplies – 0.0%(a)** | **Health Care Equipment & Supplies – 0.0%(a)** | **Health Care Equipment & Supplies – 0.0%(a)** |
|  Microport Scientific Corp.\* | 600 | 1267 |
| **Health Care Providers & Services – 0.5%** | **Health Care Providers & Services – 0.5%** | **Health Care Providers & Services – 0.5%** |
|  Apollo Hospitals Enterprise Ltd. | 84 | 4584 |
|  Dr Sulaiman Al Habib Medical Services Group Co. | 88 | 5307 |
|  Sinopharm Group Co. Ltd., Class H | 4800 | 9148 |
|  |  | **19039** |
| **Hotels, Restaurants & Leisure – 1.8%** | **Hotels, Restaurants & Leisure – 1.8%** | **Hotels, Restaurants & Leisure – 1.8%** |
|  Genting Bhd. | 7400 | 6949 |
|  Jubilant Foodworks Ltd. | 622 | 4583 |
|  Kangwon Land, Inc.\* | 336 | 5425 |
|  OPAP SA | 110 | 1348 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Trip.com Group Ltd.\* | 350 | $| 7723 |
|  Yum China Holdings, Inc. | 1010 |  | 41764 |
|  |  |  | **67792** |
| **Household Durables – 0.8%** | **Household Durables – 0.8%** | **Household Durables – 0.8%** | **Household Durables – 0.8%** |
|  Arcelik A/S | 594 |  | 2511 |
|  Coway Co. Ltd. | 202 |  | 7842 |
|  LG Electronics, Inc. | 378 |  | 21654 |
|  |  |  | **32007** |
| **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** |
|  Unilever Indonesia Tbk. PT | 26800 |  | 7973 |
| **Independent Power and Renewable Electricity<br>Producers –1.4%** | **Independent Power and Renewable Electricity<br>Producers –1.4%** | **Independent Power and Renewable Electricity<br>Producers –1.4%** | **Independent Power and Renewable Electricity<br>Producers –1.4%** |
|  Adani Green Energy Ltd.\* | 1106 |  | 28097 |
|  China Longyuan Power Group Corp. Ltd., Class H | 12000 |  | 13712 |
|  Energy Absolute PCL, NVDR | 5200 |  | 13185 |
|  |  |  | **54994** |
| **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** | **Industrial Conglomerates – 2.2%** |
|  Far Eastern New Century Corp. | 12000 |  | 11973 |
|  International Holding Co. PJSC\* | 350 |  | 38401 |
|  Samsung C&T Corp. | 232 |  | 19300 |
|  Siemens Ltd. | 224 |  | 7917 |
|  Turkiye Sise ve Cam Fabrikalari A/S | 4658 |  | 8318 |
|  |  |  | **85909** |
| **Insurance – 3.0%** | **Insurance – 3.0%** | **Insurance – 3.0%** | **Insurance – 3.0%** |
|  Cathay Financial Holding Co. Ltd. | 26000 |  | 30500 |
|  Fubon Financial Holding Co. Ltd. | 22050 |  | 34899 |
|  ICICI Prudential Life Insurance Co. Ltd.(b) | 1062 |  | 6512 |
|  Ping An Insurance Group Co. of China Ltd., Class H | 9500 |  | 38001 |
|  Powszechny Zaklad Ubezpieczen SA | 450 |  | 2527 |
|  Sanlam Ltd. | 1186 |  | 3449 |
|  |  |  | **115888** |
| **Interactive Media & Services – 4.6%** | **Interactive Media & Services – 4.6%** | **Interactive Media & Services – 4.6%** | **Interactive Media & Services – 4.6%** |
|  Baidu, Inc., ADR\* | 318 |  | 24350 |
|  NAVER Corp. | 138 |  | 16421 |
|  Tencent Holdings Ltd. | 5200 |  | 136196 |
|  |  |  | **176967** |

---

*See Accompanying Notes to the Financial Statements.* 

326 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Internet & Direct Marketing Retail – 7.1%** | **Internet & Direct Marketing Retail – 7.1%** | **Internet & Direct Marketing Retail – 7.1%** |
|  Alibaba Group Holding Ltd., ADR\* | 1936 | $123091 |
|  Alibaba Health Information Technology Ltd.\* | 14000 | 5921 |
|  JD.com, Inc., ADR | 486 | 18123 |
|  Meituan, Class B\* (b) | 3200 | 50875 |
|  Naspers Ltd., Class N | 272 | 28123 |
|  Pinduoduo, Inc., ADR\* | 308 | 16888 |
|  Prosus NV\* | 448 | 19500 |
|  Vipshop Holdings Ltd., ADR\* | 1514 | 10552 |
|  |  | **273073** |
| **IT Services – 3.4%** | **IT Services – 3.4%** | **IT Services – 3.4%** |
|  Arabian Internet & Communications Services Co. | 44 | 2904 |
|  Elm Co. | 14 | 1233 |
|  HCL Technologies Ltd. | 474 | 5962 |
|  Infosys Ltd. | 4054 | 75306 |
|  Tech Mahindra Ltd. | 1932 | 24819 |
|  Wipro Ltd. | 4882 | 22798 |
|  |  | **133022** |
| **Life Sciences Tools & Services – 1.0%** | **Life Sciences Tools & Services – 1.0%** | **Life Sciences Tools & Services – 1.0%** |
|  Divi's Laboratories Ltd. | 482 | 21014 |
|  Wuxi Biologics Cayman, Inc.\* (b) | 4000 | 18090 |
|  |  | **39104** |
| **Machinery – 0.0%(a)** | **Machinery – 0.0%(a)** | **Machinery – 0.0%(a)** |
|  Weichai Power Co. Ltd., Class H | 1000 | 958 |
| **Marine – 0.2%** | **Marine – 0.2%** | **Marine – 0.2%** |
|  COSCO SHIPPING Holdings Co. Ltd., Class H | 1000 | 1079 |
|  MISC Bhd. | 4400 | 6728 |
|  |  | **7807** |
| **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** |
|  China Literature Ltd.\* (b) | 1200 | 3233 |
|  Grupo Televisa SAB, Series CPO | 7400 | 7837 |
|  |  | **11070** |
| **Metals & Mining – 3.0%** | **Metals & Mining – 3.0%** | **Metals & Mining – 3.0%** |
|  Anglo American Platinum Ltd. | 184 | 14629 |
|  AngloGold Ashanti Ltd. | 136 | 1785 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Gold Fields Ltd. | 3224 | $| 26050 |
|  Grupo Mexico SAB de CV, Series B | 4000 |  | 14475 |
|  Hindalco Industries Ltd. | 4888 |  | 23954 |
|  JSW Steel Ltd. | 1218 |  | 9917 |
|  Kumba Iron Ore Ltd. | 244 |  | 4594 |
|  POSCO Holdings, Inc. | 84 |  | 14683 |
|  Press Metal Aluminium Holdings Bhd. | 5600 |  | 5152 |
|  |  |  | **115239** |
| **Multiline Retail – 0.3%** | **Multiline Retail – 0.3%** | **Multiline Retail – 0.3%** | **Multiline Retail – 0.3%** |
|  Woolworths Holdings Ltd. | 3332 |  | 11439 |
| **Oil, Gas & Consumable Fuels – 4.7%** | **Oil, Gas & Consumable Fuels – 4.7%** | **Oil, Gas & Consumable Fuels – 4.7%** | **Oil, Gas & Consumable Fuels – 4.7%** |
|  Bharat Petroleum Corp. Ltd. | 1588 |  | 5825 |
|  Empresas Copec SA | 1292 |  | 8901 |
|  Hindustan Petroleum Corp. Ltd. | 874 |  | 2258 |
|  Indian Oil Corp. Ltd. | 2406 |  | 1984 |
|  MOL Hungarian Oil & Gas plc | 1438 |  | 8609 |
|  Petroleo Brasileiro SA | 800 |  | 5071 |
|  Petroleo Brasileiro SA (Preference) | 1600 |  | 9090 |
|  Petronas Dagangan Bhd. | 1000 |  | 4585 |
|  Polski Koncern Naftowy ORLEN SA | 1806 |  | 20788 |
|  PTT Exploration & Production PCL, NVDR | 5000 |  | 23844 |
|  PTT PCL, NVDR | 21800 |  | 20620 |
|  Reliance Industries Ltd. | 1054 |  | 32464 |
|  SK Innovation Co. Ltd.\* | 196 |  | 23804 |
|  Thai Oil PCL, NVDR | 4173 |  | 5975 |
|  Ultrapar Participacoes SA | 2600 |  | 6645 |
|  |  |  | **180463** |
| **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** |
|  Empresas CMPC SA | 3974 |  | 6303 |
|  Suzano SA | 200 |  | 2028 |
|  |  |  | **8331** |
| **Personal Products – 1.6%** | **Personal Products – 1.6%** | **Personal Products – 1.6%** | **Personal Products – 1.6%** |
|  AMOREPACIFIC Group | 52 |  | 902 |
|  Colgate-Palmolive India Ltd. | 38 |  | 749 |
|  Godrej Consumer Products Ltd.\* | 500 |  | 5009 |
|  Hindustan Unilever Ltd. | 1628 |  | 50165 |
|  LG H&H Co. Ltd. | 14 |  | 5012 |
|  |  |  | **61837** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 327

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Pharmaceuticals – 2.1%** | **Pharmaceuticals – 2.1%** | **Pharmaceuticals – 2.1%** |
|  Aspen Pharmacare Holdings Ltd. | 1302 | $10716 |
|  China Medical System Holdings Ltd. | 5000 | 5459 |
|  Cipla Ltd. | 438 | 6177 |
|  CSPC Pharmaceutical Group Ltd. | 32000 | 32898 |
|  Dr Reddy's Laboratories Ltd. | 420 | 22496 |
|  Shanghai Fosun Pharmaceutical Group Co. Ltd., Class H | 1500 | 3787 |
|  |  | **81533** |
| **Real Estate Management & Development – 1.3%** | **Real Estate Management & Development – 1.3%** | **Real Estate Management & Development – 1.3%** |
|  Aldar Properties PJSC | 5528 | 6502 |
|  China Overseas Land & Investment Ltd. | 10000 | 19083 |
|  DLF Ltd. | 2226 | 10366 |
|  Longfor Group Holdings Ltd.(c) | 4000 | 5096 |
|  NEPI Rockcastle NV | 1564 | 7872 |
|  |  | **48919** |
| **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** |
|  BTS Group Holdings PCL, NVDR | 29400 | 6411 |
|  Full Truck Alliance Co. Ltd., ADR\* | 992 | 4722 |
|  Rumo SA | 4600 | 19409 |
|  |  | **30542** |
| **Semiconductors & Semiconductor Equipment – 8.1%** | **Semiconductors & Semiconductor Equipment – 8.1%** | **Semiconductors & Semiconductor Equipment – 8.1%** |
|  Flat Glass Group Co. Ltd., Class H | 2000 | 4683 |
|  GCL Technology Holdings Ltd.\* | 72000 | 18253 |
|  SK Hynix, Inc. | 398 | 23107 |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 19000 | 229963 |
|  United Microelectronics Corp.\* | 17000 | 20628 |
|  Xinyi Solar Holdings Ltd. | 18000 | 17863 |
|  |  | **314497** |
| **Specialty Retail – 0.6%** | **Specialty Retail – 0.6%** | **Specialty Retail – 0.6%** |
|  GOME Retail Holdings Ltd.\* | 62000 | 1011 |
|  Home Product Center PCL, NVDR | 1800 | 690 |
|  Lojas Renner SA\* | 3600 | 21200 |
|  |  | **22901** |
| **Technology Hardware, Storage & Peripherals – 5.0%** | **Technology Hardware, Storage & Peripherals – 5.0%** | **Technology Hardware, Storage & Peripherals – 5.0%** |
|  Asustek Computer, Inc. | 1000 | 7324 |
|  Lenovo Group Ltd. | 26000 | 20800 |
|  Samsung Electronics Co. Ltd. | 3382 | 141031 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** | **Technology Hardware, Storage & Peripherals – (continued)** |
|  Samsung Electronics Co. Ltd. (Preference) | 654 | $24471 |
|  |  | **193626** |
| **Textiles, Apparel & Luxury Goods – 1.1%** | **Textiles, Apparel & Luxury Goods – 1.1%** | **Textiles, Apparel & Luxury Goods – 1.1%** |
|  Feng TAY Enterprise Co. Ltd. | 2000 | 9962 |
|  Li Ning Co. Ltd. | 3500 | 18102 |
|  LPP SA | 4 | 6950 |
|  Page Industries Ltd. | 12 | 7215 |
|  |  | **42229** |
| **Transportation Infrastructure – 1.6%** | **Transportation Infrastructure – 1.6%** | **Transportation Infrastructure – 1.6%** |
|  Abu Dhabi Ports Co. PJSC\* | 3300 | 5103 |
|  Airports of Thailand PCL, NVDR\* | 10000 | 19443 |
|  CCR SA | 4400 | 10867 |
|  Grupo Aeroportuario del Pacifico SAB de CV, Class B | 600 | 9277 |
|  Grupo Aeroportuario del Sureste SAB de CV, Class B | 150 | 3504 |
|  Malaysia Airports Holdings Bhd.\* | 2600 | 3288 |
|  Taiwan High Speed Rail Corp. | 9000 | 7849 |
|  Westports Holdings Bhd. | 800 | 569 |
|  |  | **59900** |
| **Wireless Telecommunication Services – 2.8%** | **Wireless Telecommunication Services – 2.8%** | **Wireless Telecommunication Services – 2.8%** |
|  Advanced Info Service PCL, NVDR | 1400 | 7026 |
|  Bharti Airtel Ltd. | 3980 | 40003 |
|  Etihad Etisalat Co. | 1382 | 13461 |
|  Mobile Telecommunications Co. KSCP | 7538 | 14577 |
|  Taiwan Mobile Co. Ltd. | 6000 | 17708 |
|  Vodacom Group Ltd. | 2254 | 15370 |
|  |  | **108145** |
| **Total Common Stocks <br>(Cost $4,923,430)** | **Total Common Stocks <br>(Cost $4,923,430)** | **3824002** |
| **Total Investments – 98.9% <br>(Cost $4,923,430)** | **Total Investments – 98.9% <br>(Cost $4,923,430)** | **3824002** |
|  Other assets less liabilities – 1.1% | Other assets less liabilities – 1.1% | 43733 |
| **Net Assets – 100.0%** | **Net Assets – 100.0%** | $**3867735** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Represents less than 0.05% of net assets.* 

*See Accompanying Notes to the Financial Statements.* 

328 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

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*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*NVDR – Non-Voting Depositary Receipt* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $63241 |
|  Aggregate gross unrealized depreciation | (1171602) |
|  Net unrealized depreciation | $(1108361) |
|  Federal income tax cost | $4925550 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund had the following open futures contract as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI Emerging Markets E-Mini Index | 1 | 12/16/2022 | USD | $42680 | $(6812) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 329

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (cont.)

------

*FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Brazil | 6.2% |
|  Chile | 1.1 |
|  China | 22.4 |
|  Colombia | 0.4 |
|  Czech Republic | 0.1 |
|  Egypt | 0.3 |
|  Greece | 0.3 |
|  Hungary | 0.7 |
|  India | 15.6 |
|  Indonesia | 0.9 |
|  Kuwait | 0.4 |
|  Malaysia | 1.4 |
|  Mexico | 3 |
|  Philippines | 0.2 |
|  Poland | 1 |
|  Saudi Arabia | 3.1 |
|  South Africa | 6.4 |
|  South Korea | 11.9 |
|  Taiwan | 15.6 |
|  Thailand | 4.6 |
|  Turkey | 0.8 |
|  United Arab Emirates | 2.5 |
|  Other<sup>1</sup> | 1.1 |
|  | 100.0% |

---

*<sup>1</sup>* *Includes any non-equity securities and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.9% |
|  Others<sup>(1)</sup> | 1.1 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

330 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares® Morningstar Global Upstream Natural Resources Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.8%** | **COMMON STOCKS – 99.8%** | **COMMON STOCKS – 99.8%** |
| **Building Products – 0.2%** | **Building Products – 0.2%** | **Building Products – 0.2%** |
|  Steico SE | 23142 | $1017821 |
|  UFP Industries,<br>Inc.(a) | 198360 | 14129183 |
|  |  | **15147004** |
| **Chemicals – 15.1%** | **Chemicals – 15.1%** | **Chemicals – 15.1%** |
|  CF Industries Holdings, <br>Inc.(a) | 988494 | 105037372 |
|  Corteva, Inc.(a) | 3362202 | 219686279 |
|  Fertiglobe plc | 7230222 | 10019420 |
|  FMC Corp.(a) | 588468 | 69968845 |
|  ICL Group Ltd. | 4565586 | 41407446 |
|  K+S AG (Registered) | 1216608 | 26886436 |
|  Mosaic Co. (The) | 1715814 | 92225002 |
|  Nutrien Ltd. | 3487830 | 294332401 |
|  PhosAgro PJSC‡ | 308581 |  |
|  PI Industries Ltd. | 525654 | 20587043 |
|  Qinghai Salt Lake Industry Co. Ltd., Class A\* | 2644800 | 7794597 |
|  SABIC Agri-Nutrients Co. | 1292646 | 54698065 |
|  Scotts Miracle-Gro Co. <br>(The)(a) | 218196 | 10017378 |
|  Shandong Hualu Hengsheng Chemical Co. Ltd., Class A | 991800 | 3557576 |
|  UPL Ltd. | 3540726 | 31233586 |
|  Yara International ASA | 1031472 | 46033463 |
|  |  | **1033484909** |
| **Equity Real Estate Investment Trusts (REITs) – 1.0%** | **Equity Real Estate Investment Trusts (REITs) – 1.0%** | **Equity Real Estate Investment Trusts (REITs) – 1.0%** |
|  Weyerhaeuser Co. | 2248080 | 69533114 |
| **Food Products – 9.6%** | **Food Products – 9.6%** | **Food Products – 9.6%** |
|  Archer-Daniels-Midland <br>Co.(a) | 2651412 | 257133936 |
|  Bakkafrost P/F | 340518 | 17014682 |
|  Bunge Ltd. | 737238 | 72765391 |
|  Charoen Pokphand Indonesia Tbk. PT | 44300400 | 15834251 |
|  IOI Corp. Bhd. | 20827800 | 17973228 |
|  Kuala Lumpur Kepong Bhd. | 3636600 | 16675442 |
|  Mowi ASA | 2952258 | 44027528 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Muyuan Foods Co. Ltd., Class A | 2644800 | $| 16951709 |
|  New Hope Liuhe Co. Ltd., Class A\* | 2314200 |  | 4087090 |
|  PPB Group Bhd. | 4628400 |  | 16348198 |
|  Salmar ASA | 380190 |  | 12879181 |
|  Tongwei Co. Ltd., Class A | 1983600 |  | 11822350 |
|  Tyson Foods, Inc., Class A | 1391826 |  | 95131307 |
|  Wilmar International Ltd. | 19836000 |  | 54387450 |
|  |  |  | **653031743** |
| **Industrial Conglomerates – 4.6%** | **Industrial Conglomerates – 4.6%** | **Industrial Conglomerates – 4.6%** | **Industrial Conglomerates – 4.6%** |
|  International Holding Co. PJSC\* | 2833242 |  | 310857877 |
| **Metals & Mining – 28.5%** | **Metals & Mining – 28.5%** | **Metals & Mining – 28.5%** | **Metals & Mining – 28.5%** |
|  Agnico Eagle Mines Ltd.(a) | 1352154 |  | 59407345 |
|  Alcoa Corp. | 492594 |  | 19225944 |
|  Anglo American plc | 4165560 |  | 125104117 |
|  AngloGold Ashanti Ltd. | 1269504 |  | 16666752 |
|  Barrick Gold Corp. | 5243316 |  | 78762175 |
|  BHP Group Ltd. | 13554600 |  | 323817390 |
|  Boliden AB | 866172 |  | 25208106 |
|  First Quantum Minerals Ltd.(a) | 1854666 |  | 32673013 |
|  Fortescue Metals Group Ltd.(a) | 6023532 |  | 56620689 |
|  Franco-Nevada Corp. | 571938 |  | 70579761 |
|  Freeport-McMoRan, Inc.(a) | 3881244 |  | 122996622 |
|  Glencore plc | 33979068 |  | 195413391 |
|  Gold Fields Ltd. | 2734062 |  | 22091191 |
|  Grupo Mexico SAB de CV, Series B | 9256800 |  | 33498713 |
|  Hindalco Industries Ltd. | 4506078 |  | 22081973 |
|  Impala Platinum Holdings Ltd. | 2545620 |  | 26055292 |
|  MMC Norilsk Nickel PJSC‡ | 46158 |  |  |
|  MMC Norilsk Nickel PJSC, ADR‡ | 1231473 |  |  |
|  Newcrest Mining Ltd.(a) | 2902668 |  | 32203527 |
|  Newmont Corp.(a) | 1986906 |  | 84085862 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 331

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Norsk Hydro ASA | 4605258 | $| 29225672 |
|  Rio Tinto plc | 3358896 |  | 175457809 |
|  Royal Gold, Inc.(a) | 165300 |  | 15696888 |
|  Saudi Arabian Mining Co.\* | 2585292 |  | 57587774 |
|  Sibanye Stillwater Ltd. | 8222022 |  | 19296194 |
|  South32 Ltd.(a) | 14711700 |  | 33866628 |
|  Sumitomo Metal Mining Co. Ltd. | 906900 |  | 25516573 |
|  Teck Resources Ltd., Class B(a) | 1484394 |  | 45128712 |
|  Vale SA | 12036234 |  | 153983970 |
|  Wheaton Precious Metals Corp.(a) | 1312482 |  | 42885028 |
|  Zijin Mining Group Co. Ltd., Class A | 4959000 |  | 5381207 |
|  |  |  | **1950518318** |
| **Multi-Utilities – 0.9%** | **Multi-Utilities – 0.9%** | **Multi-Utilities – 0.9%** | **Multi-Utilities – 0.9%** |
|  Veolia Environnement SA | 2866302 |  | 63995428 |
| **Oil, Gas & Consumable Fuels – 32.9%** | **Oil, Gas & Consumable Fuels – 32.9%** | **Oil, Gas & Consumable Fuels – 32.9%** | **Oil, Gas & Consumable Fuels – 32.9%** |
|  APA Corp.(a) | 307458 |  | 13977041 |
|  BP plc | 23707326 |  | 130963472 |
|  Cameco Corp.(a) | 1203384 |  | 28504334 |
|  Canadian Natural Resources Ltd.(a) | 1434804 |  | 85948341 |
|  Cenovus Energy, Inc.(a) | 1570350 |  | 31705171 |
|  Chevron Corp. | 1692672 |  | 306204365 |
|  China Petroleum & Chemical Corp., Class H | 33060000 |  | 13055791 |
|  ConocoPhillips | 1120734 |  | 141313350 |
|  Coterra Energy, Inc.(a) | 724014 |  | 22538556 |
|  Devon Energy Corp.(a) | 535572 |  | 41426494 |
|  Diamondback Energy, <br>Inc.(a) | 145464 |  | 22853849 |
|  Eni SpA | 3058050 |  | 40059204 |
|  Enviva, Inc.(a) | 89262 |  | 5341438 |
|  EOG Resources, Inc. | 515736 |  | 70408279 |
|  EQT Corp.(a) | 261174 |  | 10927520 |
|  Equinor ASA | 1391826 |  | 50917443 |
|  Exxon Mobil Corp. | 3507666 |  | 388684470 |
|  Gazprom PJSC‡ | 15937700 |  |  |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Hess Corp. | 241338 | $| 34047965 |
|  Inpex Corp. | 1322400 |  | 13505589 |
|  LUKOIL PJSC‡ | 214305 |  |  |
|  LUKOIL PJSC, ADR‡ | 269035 |  |  |
|  Marathon Oil Corp. | 618222 |  | 18824860 |
|  Novatek PJSC‡ | 1237715 |  |  |
|  Occidental Petroleum Corp.(a) | 816582 |  | 59283853 |
|  Ovintiv, Inc.(a) | 231420 |  | 11721423 |
|  Petroleo Brasileiro SA (Preference) | 5620200 |  | 31928755 |
|  Pioneer Natural Resources <br>Co.(a) | 204972 |  | 52556871 |
|  Repsol SA | 1676142 |  | 22770173 |
|  Rosneft Oil Co. PJSC‡ | 2926433 |  |  |
|  Santos Ltd. | 3686190 |  | 18149933 |
|  Saudi Arabian Oil Co.(b) | 2624964 |  | 24380579 |
|  Shell plc | 9260106 |  | 256305418 |
|  Suncor Energy, Inc. | 1785240 |  | 61329384 |
|  Tatneft PJSC‡ | 2021036 |  |  |
|  TotalEnergies SE | 2978706 |  | 162214625 |
|  Tourmaline Oil Corp.(a) | 373578 |  | 21022578 |
|  Woodside Energy Group <br>Ltd.(a) | 2287753 |  | 52635266 |
|  |  |  | **2245506390** |
| **Paper & Forest Products – 3.3%** | **Paper & Forest Products – 3.3%** | **Paper & Forest Products – 3.3%** | **Paper & Forest Products – 3.3%** |
|  Canfor Corp.\* (a) | 247950 |  | 3720931 |
|  Chengxin Lithium Group Co. Ltd., Class A | 330600 |  | 1957709 |
|  Dongwha Enterprise Co. Ltd.\* | 26448 |  | 1219863 |
|  Interfor Corp.\* (a) | 211584 |  | 3753772 |
|  Mondi plc | 1828218 |  | 30784437 |
|  Stella-Jones, Inc.(a) | 234726 |  | 7060451 |
|  Stora Enso OYJ, Class R | 2426604 |  | 31634026 |
|  Suzano SA | 2975400 |  | 30166522 |
|  Svenska Cellulosa AB SCA, Class B | 2446440 |  | 28846891 |
|  UPM-Kymmene OYJ | 2013354 |  | 67477456 |
|  West Fraser Timber Co. Ltd.(a) | 267786 |  | 20081251 |
|  |  |  | **226703309** |

---

*See Accompanying Notes to the Financial Statements.* 

332 FLEXSHARES ANNUAL REPORT

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Water Utilities – 3.7%** | **Water Utilities – 3.7%** | **Water Utilities – 3.7%** |
|  American States Water <br>Co.(a) | 119016 | $10766187 |
|  American Water Works Co., Inc.(a) | 568632 | 82644975 |
|  Beijing Enterprises Water Group Ltd.(a) | 19836000 | 4169430 |
|  California Water Service Group(a) | 171912 | 10668859 |
|  China Water Affairs Group Ltd.(a) | 3640000 | 2578189 |
|  Cia de Saneamento Basico do Estado de Sao Paulo\* | 1476573 | 16912104 |
|  Cia de Saneamento de Minas Gerais-COPASA\* | 991800 | 2903244 |
|  Cia de Saneamento do Parana | 991800 | 3617714 |
|  Essential Utilities, Inc.(a) | 750462 | 33185430 |
|  Guangdong Investment Ltd. | 13224000 | 8338860 |
|  Pennon Group plc | 1153794 | 11125523 |
|  Severn Trent plc | 1094286 | 31535452 |
|  TTW PCL, NVDR | 6281400 | 1435843 |
|  United Utilities Group plc | 2939034 | 31787951 |
|  |  | **251669761** |
| **TOTAL COMMON STOCKS <br>(Cost $5,959,339,348)** | **TOTAL COMMON STOCKS <br>(Cost $5,959,339,348)** | **6820447853** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(c) – 2.9%** | **SECURITIES LENDING REINVESTMENTS(c) – 2.9%** | **SECURITIES LENDING REINVESTMENTS(c) – 2.9%** |
| **CERTIFICATES OF DEPOSIT – 0.3%** | **CERTIFICATES OF DEPOSIT – 0.3%** | **CERTIFICATES OF DEPOSIT – 0.3%** |
|  Barclays Bank plc, New York (SOFR + 0.52%), 3.56%, 4/5/2023(d) | $3000000 | 2997294 |
|  Credit Agricole CIB, New York (SOFR + 0.68%), 3.73%, 4/25/2023(d) | 6000000 | 5999400 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CERTIFICATES OF DEPOSIT – (continued)** | **CERTIFICATES OF DEPOSIT – (continued)** | **CERTIFICATES OF DEPOSIT – (continued)** | **CERTIFICATES OF DEPOSIT – (continued)** | **CERTIFICATES OF DEPOSIT – (continued)** |
|  MUFG Bank Ltd., New York Branch (SOFR + 0.59%), 3.63%, 2/10/2023(d) | $| 3000000 | $| 3000069 |
|  Royal Bank of Canada (US Federal Funds Effective Rate (continuous series) + 0.37%), 3.45%, 12/2/2022(d) |  | 4000000 |  | 4000000 |
|  The Sumitomo Bank Ltd., New York (SOFR + 0.75%), 3.80%, 4/21/2023(d) |  | 3000000 |  | 3000021 |
| **TOTAL CERTIFICATES OF DEPOSIT <br>(Cost $19,000,000)** | **TOTAL CERTIFICATES OF DEPOSIT <br>(Cost $19,000,000)** | **TOTAL CERTIFICATES OF DEPOSIT <br>(Cost $19,000,000)** |  | **18996784** |
| **COMMERCIAL PAPER – 0.0%(e)** | **COMMERCIAL PAPER – 0.0%(e)** | **COMMERCIAL PAPER – 0.0%(e)** | **COMMERCIAL PAPER – 0.0%(e)** | **COMMERCIAL PAPER – 0.0%(e)** |
|  Macquarie Bank Ltd. (SOFR + 0.31%), 3.35%, 11/3/2022(d)<br>(Cost $3,000,000) |  | 3000000 |  | 3000000 |
| **REPURCHASE AGREEMENTS – 2.6%** | **REPURCHASE AGREEMENTS – 2.6%** | **REPURCHASE AGREEMENTS – 2.6%** | **REPURCHASE AGREEMENTS – 2.6%** | **REPURCHASE AGREEMENTS – 2.6%** |
|  BofA Securities, Inc., 3.52%, dated 10/31/2022, due 1/31/2023, repurchase price $8,071,964, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 4.13%, maturing 11/15/2023 – 2/15/2051; total market value $8,112,388 |  | 8000000 |  | 8000000 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 333

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** |
|  CF Secured LLC, 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $50,004,167, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2022 – 8/15/2052; total market value $50,728,384 | $| 50000000 | $50000000 |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $118,134,878, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $118,964,041 |  | 118125034 | 118125034 |
|  TD Prime Services LLC, 3.15%, dated 10/31/2022, due 11/1/2022, repurchase price $2,000,175, collateralized by various Common Stocks; total market value $2,187,307 |  | 2000000 | 2000000 |
| **Total Repurchase Agreements <br>(Cost $178,125,034)** | **Total Repurchase Agreements <br>(Cost $178,125,034)** | **Total Repurchase Agreements <br>(Cost $178,125,034)** | **178125034** |
| **Total Securities Lending Reinvestments <br>(Cost $200,125,034)** | **Total Securities Lending Reinvestments <br>(Cost $200,125,034)** | **Total Securities Lending Reinvestments <br>(Cost $200,125,034)** | **200121818** |
| **Total Investments – 102.7% <br>(Cost $6,159,464,382)** | **Total Investments – 102.7% <br>(Cost $6,159,464,382)** | **Total Investments – 102.7% <br>(Cost $6,159,464,382)** | **7020569671** |
|  Liabilities in excess of other assets – (2.7%) | Liabilities in excess of other assets – (2.7%) | Liabilities in excess of other assets – (2.7%) | (185717677) |
| **Net Assets – 100.0%** | **Net Assets – 100.0%** | **Net Assets – 100.0%** | $**6834851994** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $464,678,070, collateralized in the form of cash with a value of $200,125,034 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $267,069,888 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $11,930,082 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from April 19, 2023 – June 30, 2120; a total value of $479,125,004.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $200,121,818.* 

*<sup>(d)</sup>* *Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2022.* 

*<sup>(e)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*NVDR – Non-Voting Depositary Receipt* 

*OYJ – Public Limited Company* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*SCA – Limited partnership with share capital* 

*SOFR – Secured Overnight Financing Rate* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $1481067709 |
|  Aggregate gross unrealized depreciation | (663239666) |
|  Net unrealized appreciation | $817828043 |
|  Federal income tax cost | $6202409531 |

---

*See Accompanying Notes to the Financial Statements.* 

334 FLEXSHARES ANNUAL REPORT

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

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**Futures Contracts** 

*FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  FTSE 100 Index | 33 | 12/16/2022 | GBP | $2700462 | $(53572) |
|  FTSE/JSE Top 40 Index | 16 | 12/15/2022 | ZAR | 526426 | (24550) |
|  MSCI Emerging Markets E-Mini Index | 30 | 12/16/2022 | USD | 1280400 | (169207) |
|  Russell 2000 E-Mini Index | 8 | 12/16/2022 | USD | 741200 | 49771 |
|  S&P Midcap 400 E-Mini Index | 5 | 12/16/2022 | USD | 1219800 | (7829) |
|  S&P/TSX 60 Index | 57 | 12/15/2022 | CAD | 9841751 | 141290 |
|  SPI 200 Index | 5 | 12/15/2022 | AUD | 548009 | 20510 |
|  |  |  |  |  | $(43587) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  AUD | 1500000 | Toronto-Dominion Bank (The) | USD | 949882 | 12/21/2022 | $10875 |
|  BRL<sup>\*</sup> | 15890000 | JPMorgan Chase Bank | USD | 2970710 | 12/21/2022 | 25561 |
|  GBP | 4319860 | Bank of New York | USD | 4927595 | 12/21/2022 | 54819 |
|  GBP | 8500000 | Toronto-Dominion Bank (The) | USD | 9655601 | 12/21/2022 | 148079 |
|  INR<sup>\*</sup> | 76150000 | Goldman Sachs & Co. | USD | 909982 | 12/21/2022 | 6077 |
|  MXN | 2080000 | Goldman Sachs & Co. | USD | 101631 | 12/21/2022 | 2218 |
|  USD | 2659999 | Citibank NA | AUD | 3960000 | 12/21/2022 | 123603 |
|  USD | 6679780 | Citibank NA | CAD | 8870000 | 12/21/2022 | 173236 |
|  USD | 168490 | Citibank NA | CHF | 161534 | 12/21/2022 | 6078 |
|  USD | 3402650 | Citibank NA | EUR | 3370000 | 12/21/2022 | 57843 |
|  USD | 2224602 | Goldman Sachs & Co. | HKD | 17434345 | 12/21/2022 | 2199 |
|  USD | 1157537 | Citibank NA | INR<sup>\*</sup> | 93074290 | 12/21/2022 | 37885 |
|  USD | 369263 | Bank of New York | JPY | 52379584 | 12/21/2022 | 14556 |
|  USD | 252573 | Morgan Stanley | KRW<sup>\*</sup> | 350052156 | 12/21/2022 | 6574 |
|  USD | 1120929 | Citibank NA | TWD<sup>\*</sup> | 35000000 | 12/21/2022 | 30056 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $699659 |
|  AUD | 3503480 | Morgan Stanley | USD | 2345730 | 12/21/2022 | $(101737) |
|  BRL<sup>\*</sup> | 60000000 | JPMorgan Chase Bank | USD | 11436457 | 12/21/2022 | (122659) |
|  CAD | 10969539 | Toronto-Dominion Bank (The) | USD | 8240828 | 12/21/2022 | (194178) |
|  EUR | 3568602 | Morgan Stanley | USD | 3588053 | 12/21/2022 | (46128) |
|  NOK | 20291048 | Morgan Stanley | USD | 1974529 | 12/21/2022 | (19390) |
|  NZD | 126346 | Citibank NA | USD | 75152 | 12/21/2022 | (1694) |
|  SEK | 3099173 | Morgan Stanley | USD | 288212 | 12/21/2022 | (6547) |
|  SGD | 79915 | JPMorgan Chase Bank | USD | 56761 | 12/21/2022 | (271) |
|  TWD<sup>\*</sup> | 28770000 | JPMorgan Chase Bank | USD | 897884 | 12/21/2022 | (1186) |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 335

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

------

**Forward Foreign Currency Contracts (cont.)** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 13670858 | Citibank NA | BRL<sup>\*</sup> | 73800760 | 12/21/2022 | $(245257) |
|  USD | 1814367 | Morgan Stanley | CAD | 2500000 | 12/21/2022 | (19495) |
|  USD | 1209420 | JPMorgan Chase Bank | EUR | 1230000 | 12/21/2022 | (11385) |
|  USD | 8019802 | Citibank NA | GBP | 7000000 | 12/21/2022 | (53817) |
|  USD | 5354789 | Morgan Stanley | GBP | 4750000 | 12/21/2022 | (123738) |
|  USD | 1575693 | Morgan Stanley | NOK | 16680000 | 12/21/2022 | (31504) |
|  ZAR | 5390000 | JPMorgan Chase Bank | USD | 301341 | 12/21/2022 | (9183) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(988169) |
|  Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | $(288510) |

---

*\** *Non-deliverable forward. See Note 2 in the Notes to Financial Statements.* 

*Abbreviations:* 

*AUD – Australian Dollar* 

*BRL – Brazilian Real* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*INR – Indian Rupee* 

*JPY – Japanese Yen* 

*KRW – Korean Won* 

*MXN – Mexican Peso* 

*NOK – Norwegian Krone* 

*NZD – New Zealand Dollar* 

*SEK – Swedish Krona* 

*SGD – Singapore Dollar* 

*TWD – Taiwan Dollar* 

*USD – US Dollar* 

*ZAR – South African Rand* 

*See Accompanying Notes to the Financial Statements.* 

336 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares® Morningstar Global Upstream Natural Resources Index Fund (cont.)

------

*FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 7.6 | % |
|  Brazil | 3.5 |  |
|  Canada | 13.0 |  |
|  China | 1.2 |  |
|  Finland | 1.5 |  |
|  France | 3.3 |  |
|  Germany | 0.4 |  |
|  India | 1.1 |  |
|  Indonesia | 0.2 |  |
|  Israel | 0.6 |  |
|  Italy | 0.6 |  |
|  Japan | 0.6 |  |
|  Malaysia | 0.7 |  |
|  Mexico | 0.5 |  |
|  Norway | 2.9 |  |
|  Saudi Arabia | 2.0 |  |
|  Singapore | 0.8 |  |
|  South Africa | 1.2 |  |
|  South Korea | 0.0 | <sup>†</sup> |
|  Spain | 0.3 |  |
|  Sweden | 0.8 |  |
|  Thailand | 0.0 | <sup>†</sup> |
|  United Arab Emirates | 4.7 |  |
|  United Kingdom | 14.5 |  |
|  United States | 37.8 |  |
|  Other<sup>1</sup> | 0.2 |  |
|  | 100.0 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.8% |
|  Securities Lending Reinvestments | 2.9 |
|  Others<sup>(1)</sup> | (2.7) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 337

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** | **COMMON STOCKS – 99.3%** |
| **Air Freight & Logistics – 2.4%** | **Air Freight & Logistics – 2.4%** | **Air Freight & Logistics – 2.4%** |
|  bpost SA(a) | 188370 | $930877 |
|  CTT-Correios de Portugal SA(a) | 152145 | 469914 |
|  Deutsche Post AG (Registered) | 1523520 | 54072237 |
|  International Distributions Services plc | 1070190 | 2492666 |
|  Oesterreichische Post AG(a) | 56925 | 1623154 |
|  PostNL NV(a) | 428481 | 672077 |
|  |  | **60260925** |
| **Commercial Services & Supplies – 4.8%** | **Commercial Services & Supplies – 4.8%** | **Commercial Services & Supplies – 4.8%** |
|  Ambipar Participacoes e Empreendimentos S/A | 103500 | 616789 |
|  Befesa SA(b) | 48645 | 1689471 |
|  Biffa plc(b) | 500940 | 2372779 |
|  Casella Waste Systems, Inc., Class A\* (a) | 22770 | 1862814 |
|  China Everbright Environment Group Ltd. | 5175000 | 1720638 |
|  Clean Harbors, Inc.\* | 23805 | 2915160 |
|  Cleanaway Co. Ltd. | 112000 | 580464 |
|  Cleanaway Waste Management Ltd.(a) | 3148470 | 5435881 |
|  CoreCivic, Inc., REIT\* | 58995 | 617678 |
|  Daiseki Co. Ltd.(a) | 75160 | 2326074 |
|  GEO Group, Inc. (The)\* (a) | 57960 | 490341 |
|  Insun ENT Co. Ltd.\* | 48294 | 304115 |
|  Koentec Co. Ltd. | 45333 | 245688 |
|  Midac Holdings Co. Ltd. | 21400 | 532714 |
|  Renewi plc\* | 132480 | 806888 |
|  Republic Services, Inc. | 94185 | 12490815 |
|  Shanghai Youngsun Investment Co. Ltd., Class B\* ‡ | 57800 |  |
|  Stericycle, Inc.\* | 43470 | 1937893 |
|  TRE Holdings Corp.(a) | 103500 | 1118317 |
|  Waste Connections, Inc.(a) | 398475 | 52527246 |
|  Waste Management, Inc. | 186300 | 29504331 |
|  |  | **120096096** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Diversified Financial Services – 0.0%(c)** | **Diversified Financial Services – 0.0%(c)** | **Diversified Financial Services – 0.0%(c)** |
|  Metro Pacific Investments Corp. | 13455000 | $849790 |
| **Diversified Telecommunication Services – 14.4%** | **Diversified Telecommunication Services – 14.4%** | **Diversified Telecommunication Services – 14.4%** |
|  AT&T, Inc. | 3191940 | 58189066 |
|  BCE, Inc.(a) | 840420 | 37860642 |
|  BT Group plc | 6510150 | 9729109 |
|  Cellnex Telecom SA(b) | 501975 | 16421803 |
|  China Tower Corp. Ltd., Class H(b) | 39330000 | 3557304 |
|  Deutsche Telekom AG (Registered) | 3212640 | 60849777 |
|  Frontier Communications Parent, Inc.\* (a) | 115920 | 2714846 |
|  HKT Trust & HKT Ltd. | 3357000 | 3793269 |
|  Infrastrutture Wireless Italiane SpA(b) | 329130 | 2905541 |
|  Koninklijke KPN NV | 3083265 | 8627034 |
|  Liberty Global plc, Class C\* | 122130 | 2156816 |
|  Lumen Technologies, Inc.(a) | 405720 | 2986099 |
|  Nippon Telegraph & Telephone Corp. | 2173500 | 59866848 |
|  Spark New Zealand Ltd. | 1732590 | 5153527 |
|  Swisscom AG (Registered) | 23805 | 11757993 |
|  Vantage Towers AG | 93150 | 2622005 |
|  Verizon Communications, Inc. | 1883700 | 70393869 |
|  |  | **359585548** |
| **Electric Utilities – 12.7%** | **Electric Utilities – 12.7%** | **Electric Utilities – 12.7%** |
|  American Electric Power Co., Inc. | 207432 | 18237421 |
|  American Electric Power Co., Inc. | 24408 | 2145951 |
|  Duke Energy Corp. | 347760 | 32404277 |
|  Enel SpA | 7178760 | 32062881 |
|  Eversource Energy | 156285 | 11921420 |
|  Exelon Corp. | 440910 | 17014717 |
|  Iberdrola SA | 5307480 | 53899032 |
|  NextEra Energy, Inc. | 884925 | 68581688 |
|  Orsted A/S(b) | 173880 | 14344283 |
|  Southern Co. (The) | 489555 | 32056061 |
|  SSE plc | 992565 | 17781808 |

---

*See Accompanying Notes to the Financial Statements.* 

338 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Xcel Energy, Inc. | 248400 | $| 16173324 |
|  |  |  | **316622863** |
| **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** |
|  Secure Energy Services, <br>Inc.(a) | 294975 |  | 1546183 |
| **Equity Real Estate Investment Trusts (REITs) – 4.8%** | **Equity Real Estate Investment Trusts (REITs) – 4.8%** | **Equity Real Estate Investment Trusts (REITs) – 4.8%** | **Equity Real Estate Investment Trusts (REITs) – 4.8%** |
|  American Tower Corp. | 210105 |  | 43531655 |
|  Crown Castle, Inc. | 194580 |  | 25929731 |
|  Digital Realty Trust, Inc.(a) | 127305 |  | 12762326 |
|  Equinix, Inc. | 40635 |  | 23017289 |
|  Keppel DC REIT | 1345500 |  | 1673437 |
|  SBA Communications Corp. | 48645 |  | 13129286 |
|  |  |  | **120043724** |
| **Gas Utilities – 0.9%** | **Gas Utilities – 0.9%** | **Gas Utilities – 0.9%** | **Gas Utilities – 0.9%** |
|  APA Group(a) | 965655 |  | 6489800 |
|  Beijing Enterprises Holdings Ltd. | 517500 |  | 1313223 |
|  Enagas SA(a) | 229770 |  | 3730005 |
|  Keppel Infrastructure Trust | 4864500 |  | 1821910 |
|  Petronas Gas Bhd. | 414000 |  | 1497335 |
|  PetroVietnam Gas JSC | 103500 |  | 462730 |
|  Snam SpA | 1848510 |  | 8225041 |
|  |  |  | **23540044** |
| **Health Care Providers & Services – 3.6%** | **Health Care Providers & Services – 3.6%** | **Health Care Providers & Services – 3.6%** | **Health Care Providers & Services – 3.6%** |
|  Acadia Healthcare Co., Inc.\* (a) | 41400 |  | 3365820 |
|  Apollo Hospitals Enterprise Ltd. | 179055 |  | 9771749 |
|  Bangkok Dusit Medical Services PCL, NVDR | 17491500 |  | 13557521 |
|  Bumrungrad Hospital PCL, NVDR | 931500 |  | 5555715 |
|  Encompass Health Corp. | 47610 |  | 2591888 |
|  HCA Healthcare, Inc. | 98325 |  | 21382738 |
|  IHH Healthcare Bhd. | 4347000 |  | 5470527 |
|  Life Healthcare Group Holdings Ltd. | 1624950 |  | 1746307 |
|  Mediclinic International plc | 518535 |  | 2961196 |
|  Ramsay Health Care Ltd.(a) | 286695 |  | 10737469 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Rede D'Or Sao Luiz SA\* (b) | 828000 | $| 5076328 |
|  Select Medical Holdings Corp.(a) | 54855 |  | 1408676 |
|  Tenet Healthcare Corp.\* | 50715 |  | 2249717 |
|  Universal Health Services, Inc., Class B | 28980 |  | 3357913 |
|  |  |  | **89233564** |
| **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** |
|  RWE AG | 619965 |  | 23890827 |
| **IT Services – 0.2%** |  |  |  |
|  Fastly, Inc., Class A\* (a) | 24840 |  | 210891 |
|  NEXTDC Ltd.\* (a) | 437805 |  | 2329221 |
|  Switch, Inc., Class A | 66240 |  | 2255472 |
|  |  |  | **4795584** |
| **Media – 4.1%** | **Media – 4.1%** | **Media – 4.1%** | **Media – 4.1%** |
|  Cable One, Inc.(a) | 2409 |  | 2070367 |
|  Charter Communications, Inc., Class A\* | 49680 |  | 18263361 |
|  Comcast Corp., Class A | 1974780 |  | 62679517 |
|  DISH Network Corp., Class A\* (a) | 126270 |  | 1882686 |
|  Liberty Broadband Corp., Class C\* | 60030 |  | 5068333 |
|  Shaw Communications, Inc., Class B | 410895 |  | 10540095 |
|  Sirius XM Holdings, Inc.(a) | 484380 |  | 2925655 |
|  |  |  | **103430014** |
| **Multi-Utilities – 7.4%** | **Multi-Utilities – 7.4%** | **Multi-Utilities – 7.4%** | **Multi-Utilities – 7.4%** |
|  Consolidated Edison, Inc. | 160425 |  | 14110983 |
|  Dominion Energy, Inc. | 365355 |  | 25563889 |
|  E.ON SE | 1955115 |  | 16378496 |
|  Engie SA | 1713960 |  | 22282776 |
|  National Grid plc | 3372030 |  | 36820556 |
|  Public Service Enterprise Group, Inc. | 225630 |  | 12651074 |
|  Sempra Energy | 141795 |  | 21402537 |
|  Veolia Environnement SA | 1011195 |  | 22576776 |
|  WEC Energy Group, Inc. | 141795 |  | 12950137 |
|  |  |  | **184737224** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 339

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – 7.8%** | **Oil, Gas & Consumable Fuels – 7.8%** | **Oil, Gas & Consumable Fuels – 7.8%** |
|  Antero Midstream Corp.(a) | 167670 | $1785685 |
|  DT Midstream, Inc. | 41400 | 2471580 |
|  Enbridge, Inc.(a) | 1857825 | 72294528 |
|  Equitrans Midstream Corp. | 185265 | 1559931 |
|  Keyera Corp.(a) | 194580 | 4165343 |
|  Kinder Morgan, Inc. | 890100 | 16128612 |
|  Koninklijke Vopak NV | 69345 | 1418719 |
|  ONEOK, Inc. | 199755 | 11849467 |
|  Pembina Pipeline Corp.(a) | 506115 | 16689310 |
|  Plains GP Holdings LP, Class A\* (a) | 101430 | 1271932 |
|  Targa Resources Corp.(a) | 101430 | 6934769 |
|  TC Energy Corp.(a) | 903555 | 39638379 |
|  Transneft PJSC (Preference)‡ | 1473 |  |
|  Williams Cos., Inc. (The) | 543375 | 17784664 |
|  |  | **193992919** |
| **Road & Rail – 18.7%** | **Road & Rail – 18.7%** | **Road & Rail – 18.7%** |
|  Aurizon Holdings Ltd. | 2753100 | 6372901 |
|  Canadian National Railway Co. | 989460 | 117076973 |
|  Canadian Pacific Railway Ltd. | 1339786 | 99753430 |
|  Canadian Pacific Railway Ltd. | 104039 | 7749865 |
|  Central Japan Railway Co. | 317400 | 36868241 |
|  CSX Corp. | 968760 | 28152166 |
|  East Japan Railway Co. | 580100 | 31378908 |
|  Keisei Electric Railway Co. Ltd. | 273900 | 7278938 |
|  Kyushu Railway Co. | 236900 | 4956834 |
|  MTR Corp. Ltd. | 2403000 | 10576463 |
|  Norfolk Southern Corp. | 106605 | 24313402 |
|  Odakyu Electric Railway Co. Ltd.(a) | 550900 | 6556613 |
|  Rumo SA | 1863000 | 7860655 |
|  Tobu Railway Co. Ltd. | 335100 | 7755535 |
|  Union Pacific Corp. | 281520 | 55498853 |
|  West Japan Railway Co.(a) | 370500 | 14709325 |
|  |  | **466859102** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Transportation Infrastructure – 7.7%** | **Transportation Infrastructure – 7.7%** | **Transportation Infrastructure – 7.7%** |
|  Adani Ports & Special Economic Zone Ltd. | 1319625 | $13128896 |
|  Aena SME SA\* (b) | 112815 | 13285309 |
|  Aeroports de Paris\* (a) | 42435 | 5747964 |
|  Airports of Thailand PCL, NVDR\* | 6624000 | 12879033 |
|  Atlantia SpA | 787635 | 17577605 |
|  Atlas Arteria Ltd. | 2253195 | 9494908 |
|  Auckland International Airport Ltd.\* | 1849545 | 8273597 |
|  Bangkok Expressway & Metro PCL, NVDR | 12937500 | 3195284 |
|  CCR SA | 1759500 | 4345728 |
|  China Merchants Port Holdings Co. Ltd. | 2070000 | 2426034 |
|  COSCO SHIPPING Ports Ltd. | 2423457 | 1194772 |
|  Flughafen Zurich AG (Registered)\* | 28980 | 4500117 |
|  Getlink SE | 628245 | 9953443 |
|  Grupo Aeroportuario del Pacifico SAB de CV, Class B(a) | 626175 | 9681753 |
|  Grupo Aeroportuario del Sureste SAB de CV, Class B | 294975 | 6891022 |
|  International Container Terminal Services, Inc. | 2742750 | 8188020 |
|  Japan Airport Terminal Co. Ltd.\* | 147500 | 6331281 |
|  Jiangsu Expressway Co. Ltd., Class H(a) | 2070000 | 1458257 |
|  Promotora y Operadora de Infraestructura SAB de CV | 367425 | 2758881 |
|  Qube Holdings Ltd. | 2805885 | 4880287 |
|  Santos Brasil Participacoes SA | 828000 | 1435952 |
|  Shenzhen International Holdings Ltd. | 2070679 | 1392789 |
|  Transurban Group(a) | 4767210 | 40421684 |
|  Westports Holdings Bhd. | 1656000 | 1176853 |
|  Westshore Terminals Investment Corp.(a) | 62100 | 1109473 |
|  |  | **191728942** |

---

*See Accompanying Notes to the Financial Statements.* 

340 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS –(continued)** | **COMMON STOCKS –(continued)** | **COMMON STOCKS –(continued)** |
| **Water Utilities – 2.4%** | **Water Utilities – 2.4%** | **Water Utilities – 2.4%** |
|  Aguas Andinas SA, Class A | 4159665 | $877050 |
|  American States Water Co. | 15525 | 1404391 |
|  American Water Works Co., Inc.(a) | 81765 | 11883725 |
|  Beijing Enterprises Water Group Ltd.(a) | 6210000 | 1305312 |
|  California Water Service Group | 23805 | 1477338 |
|  Cia de Saneamento Basico do Estado de Sao Paulo\* | 517500 | 5927248 |
|  Cia de Saneamento de Minas Gerais-COPASA\* | 310500 | 908910 |
|  Cia de Saneamento do Parana (Preference) | 1242000 | 911277 |
|  Essential Utilities, Inc. | 105570 | 4668305 |
|  Guangdong Investment Ltd. | 4656000 | 2936005 |
|  Middlesex Water Co.(a) | 8280 | 740812 |
|  Pennon Group plc | 381915 | 3682637 |
|  Severn Trent plc | 387090 | 11155272 |
|  SJW Group(a) | 12420 | 877846 |
|  TTW PCL, NVDR | 2898000 | 662444 |
|  United Utilities Group plc | 1039140 | 11239112 |
|  |  | **60657684** |
| **Wireless Telecommunication Services – 6.4%** | **Wireless Telecommunication Services – 6.4%** | **Wireless Telecommunication Services – 6.4%** |
|  KDDI Corp. | 1552500 | 45905995 |
|  SoftBank Group Corp.(a) | 1035000 | 44565546 |
|  T-Mobile US, Inc.\* | 272205 | 41255390 |
|  Vodafone Group plc | 24268680 | 28399989 |
|  |  | **160126920** |
| **Total Common Stocks <br>(Cost $2,547,512,547)** |  | **2481997953** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SECURITIES LENDING REINVESTMENTS(d) – 1.1%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.1%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.1%** |
| **REPURCHASE AGREEMENTS – 1.1%** | **REPURCHASE AGREEMENTS – 1.1%** | **REPURCHASE AGREEMENTS – 1.1%** |
|  BofA Securities, Inc., 3.52%, dated 10/31/2022, due 1/31/2023, repurchase price $2,017,991, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 4.13%, maturing 11/15/2023 – 2/15/2051; total market value $2,028,097 | $2000000 | $2000000 |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $19,956,233, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $20,096,301 | 19954570 | 19954570 |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $6,003,582, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $6,082,213 | 6000000 | 6000000 |
|  |  | **27954570** |
| **Total Securities Lending Reinvestments<br>(Cost $27,954,570)** | **Total Securities Lending Reinvestments<br>(Cost $27,954,570)** | **27954570** |
| **Total Investments – 100.4% <br>(Cost $2,575,467,117)** | **Total Investments – 100.4% <br>(Cost $2,575,467,117)** | **2509952523** |
|  Liabilities in excess of other assets – (0.4%) | Liabilities in excess of other assets – (0.4%) | (9434110) |
| **Net Assets – 100.0%** |  | $**2500518413** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 341

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (cont.)

------

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $156,517,412, collateralized in the form of cash with a value of $27,954,570 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $121,557,996 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $15,460,734 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 8, 2023 – June 30, 2120; a total value of $164,973,300.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(d)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $27,954,570.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*NVDR – Non-Voting Depositary Receipt* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $202845079 |
|  Aggregate gross unrealized depreciation | (279069987) |
|  Net unrealized depreciation | $(76224908) |
|  Federal income tax cost | $2586130429 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** |  |  |  |  |  |
|  FTSE 100 Index | 40 | 12/16/2022 | GBP | $3273288 | $(85586) |
|  S&P 500 E-Mini Index | 23 | 12/16/2022 | USD | 4465450 | (53754) |
|  S&P/TSX 60 Index | 40 | 12/15/2022 | CAD | 6906492 | 114410 |
|  SPI 200 Index | 18 | 12/15/2022 | AUD | 1972831 | (3859) |
|  TOPIX Index | 16 | 12/08/2022 | JPY | 2073267 | 30760 |
|  |  |  |  |  | $1971 |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  CAD | 2145816 | Toronto-Dominion Bank (The) | USD | 1612037 | 12/21/2022 | $(37984) |
|  EUR | 850130 | Morgan Stanley | USD | 854763 | 12/21/2022 | (10989) |
|  Net unrealized depreciation |  |  |  |  |  | $(48973) |

---

*See Accompanying Notes to the Financial Statements.* 

342 FLEXSHARES ANNUAL REPORT

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FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (cont.)

------

*Abbreviations:* 

*AUD – Australian Dollar* 

*CAD – Canadian Dollar* 

*EUR – Euro* 

*GBP – British Pound* 

*JPY – Japanese Yen* 

*USD – US Dollar* 

*FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 3.5 | % |
|  Austria | 0.1 |  |
|  Belgium | 0.1 |  |
|  Brazil | 1.1 |  |
|  Canada | 18.1 |  |
|  Chile | 0.0 | <sup>†</sup> |
|  China | 0.6 |  |
|  Denmark | 0.6 |  |
|  France | 2.4 |  |
|  Germany | 6.4 |  |
|  Hong Kong | 0.6 |  |
|  India | 0.9 |  |
|  Italy | 2.4 |  |
|  Japan | 10.8 |  |
|  Malaysia | 0.3 |  |
|  Mexico | 0.8 |  |
|  Netherlands | 0.4 |  |
|  New Zealand | 0.5 |  |
|  Philippines | 0.4 |  |
|  Portugal | 0.0 | <sup>†</sup> |
|  Singapore | 0.2 |  |
|  South Africa | 0.1 |  |
|  South Korea | 0.0 | <sup>†</sup> |
|  Spain | 3.5 |  |
|  Switzerland | 0.7 |  |
|  Taiwan | 0.0 | <sup>†</sup> |
|  Thailand | 1.4 |  |
|  United Kingdom | 5.1 |  |
|  United States | 38.3 |  |
|  Vietnam | 0.0 | <sup>†</sup> |
|  Other<sup>1</sup> | 0.7 |  |
|  | 100.0 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.3% |
|  Securities Lending Reinvestments | 1.1 |
|  Others<sup>(1)</sup> | (0.4) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 343

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##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Global Quality Real Estate Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 97.4%** | **COMMON STOCKS – 97.4%** | **COMMON STOCKS – 97.4%** |
| **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** |
|  GEO Group, Inc. (The)\* (a) | 88472 | $748473 |
| **Equity Real Estate Investment Trusts (REITs) – 79.6%** | **Equity Real Estate Investment Trusts (REITs) – 79.6%** | **Equity Real Estate Investment Trusts (REITs) – 79.6%** |
|  Abacus Property Group(a) | 456624 | 817567 |
|  AEON REIT Investment Corp. | 924 | 994651 |
|  American Tower Corp. | 61740 | 12791911 |
|  Apartment Income REIT Corp. | 79758 | 3065100 |
|  Apartment Investment and Management Co., Class A(a) | 107856 | 856377 |
|  Apple Hospitality REIT, Inc. | 111258 | 1904737 |
|  ARGAN SA | 3150 | 236300 |
|  Argosy Property Ltd. | 219366 | 151017 |
|  AvalonBay Communities, Inc. | 72324 | 12665379 |
|  Big Yellow Group plc | 94500 | 1225117 |
|  British Land Co. plc (The) | 461160 | 1942770 |
|  Brixmor Property Group, Inc. | 151956 | 3238182 |
|  BWP Trust(a) | 350851 | 915355 |
|  Camden Property Trust | 52290 | 6042109 |
|  Canadian Apartment Properties REIT(a) | 45486 | 1406880 |
|  Charter Hall Long Wale REIT(a) | 339696 | 944901 |
|  Covivio | 25452 | 1363427 |
|  Crown Castle, Inc. | 33138 | 4415970 |
|  CT REIT(a) | 71694 | 814675 |
|  Dexus(a) | 449946 | 2232691 |
|  DiamondRock Hospitality Co. | 116298 | 1086223 |
|  Dream Industrial REIT(a) | 91854 | 737364 |
|  Dream Office REIT(a) | 48762 | 550876 |
|  Elme Communities(a) | 48762 | 930867 |
|  Empire State Realty Trust, Inc., Class A(a) | 120834 | 890547 |
|  EPR Properties | 38808 | 1497989 |
|  Equinix, Inc. | 4662 | 2640743 |
|  Equity Commonwealth | 57204 | 1496457 |
|  Equity Residential | 184086 | 11601100 |
|  Essex Property Trust, Inc. | 8190 | 1820146 |
|  Extra Space Storage, Inc.(a) | 40068 | 7109666 |
|  Far East Hospitality Trust | 226800 | 92156 |
|  First Capital REIT(a) | 76059 | 883791 |
|  First Industrial Realty Trust, Inc. | 67914 | 3234744 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Frasers Logistics & Commercial Trust(b) | 1524600 | $1185118 |
|  Frontier Real Estate Investment Corp.(a) | 279 | 985468 |
|  Fukuoka REIT Corp.(a) | 756 | 882979 |
|  Getty Realty Corp.(a) | 32004 | 1007806 |
|  Goodman Group(a) | 281358 | 3058544 |
|  Goodman Property Trust | 758646 | 912322 |
|  GPT Group (The) | 970326 | 2674247 |
|  Granite REIT(a) | 18018 | 919624 |
|  Growthpoint Properties Australia Ltd.(a) | 350406 | 743903 |
|  H&R REIT(a) | 86058 | 707240 |
|  Highwoods Properties, Inc. | 53046 | 1497489 |
|  HomeCo Daily Needs REIT(a) (b) | 1116990 | 914252 |
|  Host Hotels & Resorts, Inc. | 365526 | 6901131 |
|  Ichigo Office REIT Investment Corp.(a) | 786 | 443673 |
|  Independence Realty Trust, Inc.(a) | 55440 | 929174 |
|  InterRent REIT | 55188 | 464064 |
|  InvenTrust Properties Corp. | 38934 | 981137 |
|  JBG SMITH Properties(a) | 57204 | 1125775 |
|  Kenedix Office Investment Corp.(a) | 458 | 1043045 |
|  Killam Apartment REIT(a) | 62244 | 720525 |
|  Kimco Realty Corp.(a) | 309204 | 6610782 |
|  Lamar Advertising Co., Class A(a) | 41958 | 3869786 |
|  LondonMetric Property plc | 507150 | 1091322 |
|  LTC Properties, Inc. | 23436 | 906270 |
|  LXP Industrial Trust(a) | 149742 | 1449503 |
|  Merlin Properties Socimi SA(a) | 176022 | 1490934 |
|  Mid-America Apartment Communities, Inc.(a) | 59724 | 9403544 |
|  Montea NV | 9155 | 625241 |
|  Mori Trust Sogo Reit, Inc.(a) | 882 | 880012 |
|  National Health Investors, Inc. | 23310 | 1321677 |
|  National Retail Properties, Inc. | 89712 | 3770595 |
|  National Storage REIT(a) | 629370 | 1050396 |
|  NIPPON REIT Investment Corp. | 22 | 54321 |

---

*See Accompanying Notes to the Financial Statements.* 

344 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Global Quality Real Estate Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  NorthWest Healthcare Properties REIT(a) | 101682 | $800605 |
|  NSI NV | 4914 | 117533 |
|  NTT UD REIT Investment<br>Corp.(a) | 882 | 863990 |
|  Omega Healthcare Investors, Inc.(a) | 120078 | 3816079 |
|  Paramount Group, Inc. | 130662 | 845383 |
|  Parkway Life REIT | 292300 | 826231 |
|  Pebblebrook Hotel Trust(a) | 67284 | 1079235 |
|  Phillips Edison & Co., Inc.(a) | 58464 | 1762105 |
|  Physicians Realty Trust | 114660 | 1726780 |
|  Piedmont Office Realty Trust, Inc., Class A | 80136 | 837421 |
|  PotlatchDeltic Corp. | 41202 | 1833077 |
|  Prologis, Inc. | 265734 | 29430040 |
|  Public Storage | 59850 | 18538537 |
|  Rayonier, Inc.(a) | 75348 | 2539228 |
|  Regency Centers Corp. | 79506 | 4810908 |
|  Retail Opportunity Investments Corp. | 66276 | 959676 |
|  RioCan REIT(a) | 81900 | 1165411 |
|  RPT Realty | 81774 | 760498 |
|  Safestore Holdings plc | 114282 | 1188812 |
|  Saul Centers, Inc.(a) | 18144 | 742997 |
|  Segro plc | 309330 | 2795755 |
|  Shopping Centres Australasia Property Group(a) | 605808 | 1053684 |
|  SITE Centers Corp. | 98658 | 1221386 |
|  SL Green Realty Corp. | 1 | 39 |
|  SmartCentres REIT(a) | 39564 | 774428 |
|  Starhill Global REIT | 378000 | 137566 |
|  Summit Industrial Income REIT(a) | 70560 | 900590 |
|  Sunstone Hotel Investors, Inc. | 112014 | 1248956 |
|  Suntec REIT | 1222200 | 1114153 |
|  Tritax Big Box REIT plc | 997920 | 1611984 |
|  UK Commercial Property REIT Ltd. | 1043910 | 733163 |
|  Universal Health Realty Income Trust | 16128 | 784950 |
|  Urban Edge Properties | 61866 | 873548 |
|  Waypoint REIT Ltd. | 555156 | 969135 |
|  Weyerhaeuser Co. | 382158 | 11820147 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  WP Carey, Inc. | 98784 | $| 7537219 |
|  |  |  | **261440933** |
| **Household Durables – 0.3%** | **Household Durables – 0.3%** | **Household Durables – 0.3%** | **Household Durables – 0.3%** |
|  Iida Group Holdings Co. Ltd. | 70000 |  | 972988 |
| **Real Estate Management & Development – 17.3%** | **Real Estate Management & Development – 17.3%** | **Real Estate Management & Development – 17.3%** | **Real Estate Management & Development – 17.3%** |
|  Airport City Ltd.\* | 49140 |  | 817487 |
|  Alony Hetz Properties & Investments Ltd. | 77490 |  | 913719 |
|  Anywhere Real Estate, Inc.\* (a) | 70308 |  | 522388 |
|  Atrium Ljungberg AB, Class B | 63504 |  | 848793 |
|  Bukit Sembawang Estates Ltd. | 39600 |  | 113615 |
|  CA Immobilien Anlagen AG(a) | 31248 |  | 986742 |
|  CK Asset Holdings Ltd. | 1041500 |  | 5758212 |
|  Daito Trust Construction Co. Ltd. | 31200 |  | 3087779 |
|  Dios Fastigheter AB | 92169 |  | 605121 |
|  DREAM Unlimited Corp., Class A(a) | 27846 |  | 507293 |
|  Entra ASA(a) (b) | 50022 |  | 454905 |
|  Fabege AB | 133308 |  | 967258 |
|  Gav-Yam Lands Corp. Ltd.(a) | 28728 |  | 244876 |
|  Grand City Properties SA(a) | 59976 |  | 583881 |
|  Heiwa Real Estate Co. Ltd.(a) | 30900 |  | 858593 |
|  Henderson Land Development Co. Ltd.(a) | 764000 |  | 1870619 |
|  Hufvudstaden AB, Class A | 84420 |  | 1005359 |
|  Intershop Holding AG | 252 |  | 153353 |
|  Isras Investment Co. Ltd. | 3276 |  | 619457 |
|  Kerry Properties Ltd. | 439500 |  | 695375 |
|  Kojamo OYJ(a) | 69804 |  | 908609 |
|  LEG Immobilien SE | 37548 |  | 2453751 |
|  Mitsubishi Estate Co. Ltd. | 189000 |  | 2381653 |
|  Mitsui Fudosan Co. Ltd. | 75600 |  | 1449337 |
|  Nomura Real Estate Holdings, Inc. | 62100 |  | 1405904 |
|  PSP Swiss Property AG (Registered) | 23310 |  | 2492301 |
|  S IMMO AG | 39060 |  | 878263 |
|  Shurgard Self Storage SA | 20916 |  | 910616 |
|  Sino Land Co. Ltd.(a) | 1800000 |  | 1923858 |
|  Sirius Real Estate Ltd. | 717948 |  | 582760 |
|  Sumitomo Realty & Development Co. Ltd.(a) | 159200 |  | 3657739 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 345

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Global Quality Real Estate Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS –(continued)** | **COMMON STOCKS –(continued)** | **COMMON STOCKS –(continued)** |
| **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** | **Real Estate Management & Development – (continued)** |
|  Sun Hung Kai Properties Ltd. | 745000 | $8014835 |
|  Swire Properties Ltd. | 50400 | 96821 |
|  Swiss Prime Site AG (Registered) | 39060 | 3153683 |
|  TAG Immobilien AG | 88457 | 554721 |
|  Tokyo Tatemono Co. Ltd. | 99800 | 1375788 |
|  Tricon Residential, Inc. | 112518 | 946964 |
|  UOL Group Ltd. | 239400 | 1047195 |
|  Wihlborgs Fastigheter AB | 139608 | 914679 |
|  Wing Tai Holdings Ltd. | 75600 | 81204 |
|  |  | **56845506** |
| **Total Common Stocks <br>(Cost $359,689,932)** |  | **320007900** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 0.8%** |
| **REPURCHASE AGREEMENTS – 0.8%** | **REPURCHASE AGREEMENTS – 0.8%** | **REPURCHASE AGREEMENTS – 0.8%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $1,527,543, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $1,538,265 | $1527416 | 1527416 |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $1,000,597, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $1,013,702 | 1000000 | 1000000 |
|  |  | **2527416** |
| **Total Securities Lending Reinvestments <br>(Cost $2,527,416)** | **Total Securities Lending Reinvestments <br>(Cost $2,527,416)** | **2527416** |
| **Total Investments – 98.2% <br>(Cost $362,217,348)** |  | **322535316** |
|  Other assets less liabilities – 1.8% | Other assets less liabilities – 1.8% | 5845365 |
| **Net Assets – 100.0%** |  | $**328380681** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $39,476,466, collateralized in the form of cash with a value of $2,527,416 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $35,151,909 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $4,420,143 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 8, 2023 – June 30, 2120; a total value of $42,099,468.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $2,527,416.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*OYJ – Public Limited Company* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $14846885 |
|  Aggregate gross unrealized depreciation | (57170568) |
|  Net unrealized depreciation | $(42323683) |
|  Federal income tax cost | $364820886 |

---

*See Accompanying Notes to the Financial Statements.* 

346 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Global Quality Real Estate Index Fund (cont.)

------

**Futures Contracts** 

*FlexShares<sup>®</sup> Global Quality Real Estate Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** |  |  |  |  |  |
|  EURO STOXX 50 Index | 11 | 12/16/2022 | EUR | $393343 | $28920 |
|  S&P Midcap 400 E-Mini Index | 21 | 12/16/2022 | USD | 5123160 | (82033) |
|  SPI 200 Index | 23 | 12/15/2022 | AUD | 2520840 | (3447) |
|  TOPIX Mini Index | 16 | 12/08/2022 | JPY | 207327 | 4758 |
|  |  |  |  |  | $(51802) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> Global Quality Real Estate Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity<br>Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  EUR | 1387568 | Morgan Stanley | USD | 1349116 | 12/21/2022 | $28079 |
|  GBP | 96255 | Bank of New York | USD | 109797 | 12/21/2022 | 1222 |
|  USD | 23005 | Morgan Stanley | AUD | 34359 | 12/21/2022 | 998 |
|  USD | 401097 | Morgan Stanley | EUR | 398923 | 12/21/2022 | 5156 |
|  USD | 32664 | BNP Paribas SA | ILS | 111846 | 12/21/2022 | 751 |
|  USD | 147876 | Bank of New York | JPY | 20976084 | 12/21/2022 | 5829 |
|  USD | 30631 | Morgan Stanley | NOK | 314773 | 12/21/2022 | 301 |
|  USD | 44671 | JPMorgan Chase Bank | SGD | 62894 | 12/21/2022 | 213 |
|  Total unrealized appreciation |  |  |  |  |  | $42549 |
|  CAD | 276702 | Toronto-Dominion Bank (The) | USD | 207871 | 12/21/2022 | $(4898) |
|  CHF | 10699 | Citibank NA | USD | 11159 | 12/21/2022 | (403) |
|  HKD | 1265868 | Goldman Sachs & Co. | USD | 161523 | 12/21/2022 | (160) |
|  JPY | 57324285 | JPMorgan Chase Bank | USD | 401034 | 12/21/2022 | (12842) |
|  NZD | 63030 | Citibank NA | USD | 37491 | 12/21/2022 | (845) |
|  SEK | 795966 | Morgan Stanley | USD | 74022 | 12/21/2022 | (1682) |
|  USD | 414553 | Bank of Montreal | CAD | 565972 | 12/21/2022 | (612) |
|  USD | 342401 | JPMorgan Chase Bank | GBP | 303301 | 12/21/2022 | (7418) |
|  Total unrealized depreciation |  |  |  |  |  | $(28860) |
|  Net unrealized appreciation |  |  |  |  |  | $13689 |

---

*Abbreviations:* 

*AUD – Australian Dollar* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*ILS – Israeli Shekel* 

*JPY – Japanese Yen* 

*NOK – Norwegian Krone* 

*NZD – New Zealand Dollar* 

*SEK – Swedish Krona* 

*SGD – Singapore Dollar* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 347

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Global Quality Real Estate Index Fund (cont.)

------

*FlexShares<sup>®</sup> Global Quality Real Estate Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 4.7 | % |
|  Austria | 0.6 |  |
|  Belgium | 0.5 |  |
|  Canada | 3.7 |  |
|  Finland | 0.3 |  |
|  France | 0.5 |  |
|  Germany | 1.1 |  |
|  Hong Kong | 5.6 |  |
|  Israel | 0.8 |  |
|  Japan | 6.5 |  |
|  Netherlands | 0.0 | <sup>†</sup> |
|  New Zealand | 0.3 |  |
|  Norway | 0.1 |  |
|  Singapore | 1.4 |  |
|  Spain | 0.4 |  |
|  Sweden | 1.3 |  |
|  Switzerland | 1.8 |  |
|  United Kingdom | 3.4 |  |
|  United States | 64.4 |  |
|  Other<sup>1</sup> | 2.6 |  |
|  | 100.0 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 97.4% |
|  Securities Lending Reinvestments | 0.8 |
|  Others<sup>(1)</sup> | 1.8 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

348 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Real Assets Allocation Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **EXCHANGE TRADED FUNDS – 100.0%** | **EXCHANGE TRADED FUNDS – 100.0%** | **EXCHANGE TRADED FUNDS – 100.0%** |
|  FlexShares<sup>®</sup> Global Quality Real Estate Index Fund(a) | 129920 | $6766701 |
|  FlexShares<sup>®</sup> Global Upstream Natural Resources Index Fund(a) | 174520 | 7230364 |
|  FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund(a) | 307560 | 14861299 |
| **Total Exchange Traded Funds <br>(Cost $34,201,324)** |  | **28858364** |
| **Total Investments – 100.0% <br>(Cost $34,201,324)** |  | **28858364** |
|  Other assets less liabilities – 0.0% |  | 6252 |
| **Net Assets – 100.0%** |  | $**28864616** |

---

*<sup>(a)</sup>* *Investment in affiliated Fund. Northern Trust Investments, Inc. is the Investment Adviser to both the Fund and the affiliated Funds.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $— |
|  Aggregate gross unrealized depreciation | (5427432) |
|  Net unrealized depreciation | $(5427432) |
|  Federal income tax cost | $34285796 |

---

*The underlying index of the FlexShares<sup>®</sup> Real Assets Allocation Index Fund is comprised of securities of affiliated FlexShares<sup>®</sup> Funds. The Schedules of Investments of the affiliated FlexShares<sup>®</sup> Funds are located elsewhere in this Report.* 

*Investment in a company which was affiliated for the period ended October 31, 2022, was as follows:* 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Security | Value<br>October 31,<br>2021 | Purchases at<br>Cost | Sales<br>Proceeds | Shares<br>October 31,<br>2022 | Value<br>October 31,<br>2022 | Change in<br>Unrealized<br>Appreciation<br>(Depreciation) | Dividend<br>Income | Realized<br>Loss |
|  FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | $8892328 | $8894799 | $7634276 | 129920 | $6766701 | $(2593533) | $260850 | $(792617) |
|  FlexShares<sup>®</sup> Global Upstream Natural Resources Index Fund | 6247673 | 7413438 | 6658060 | 174520 | 7230364 | (794121) | 372303 | 1021434 |
|  FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 15150662 | 17222381 | 13819107 | 307560 | 14861299 | (3116635) | 459996 | (576002) |
|  | $30290663 | $33530618 | $28111443 | 612000 | $28858364 | $(6504289) | $1093149 | $(347185) |

---

---

| | | |
|:---|:---|:---|
| Security Type | % of Net Assets |  |
|  Exchange Traded Funds | 100.0 | % |
|  Others<sup>(1)</sup> | 0.0 | <sup>†</sup> |
|  | 100.0 | % |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 349

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> Quality Dividend Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 99.5%** | **COMMON STOCKS – 99.5%** | **COMMON STOCKS – 99.5%** |
| **Aerospace & Defense – 0.8%** | **Aerospace & Defense – 0.8%** | **Aerospace & Defense – 0.8%** |
|  Lockheed Martin Corp.(a) | 24465 | $11906626 |
| **Air Freight & Logistics – 1.6%** | **Air Freight & Logistics – 1.6%** | **Air Freight & Logistics – 1.6%** |
|  United Parcel Service, Inc., Class B(a) | 145625 | 24431506 |
| **Banks – 5.7%** | **Banks – 5.7%** | **Banks – 5.7%** |
|  Bank of America Corp. | 61745 | 2225290 |
|  Comerica, Inc. | 101355 | 7145527 |
|  Cullen/Frost Bankers, Inc. | 61745 | 9573562 |
|  JPMorgan Chase & Co. | 378625 | 47661315 |
|  Prosperity Bancshares, Inc.(a) | 109510 | 7837631 |
|  US Bancorp | 278435 | 11819566 |
|  |  | **86262891** |
| **Beverages – 0.3%** | **Beverages – 0.3%** | **Beverages – 0.3%** |
|  Coca-Cola Co. (The) | 41940 | 2510109 |
|  PepsiCo, Inc. | 9320 | 1692326 |
|  |  | **4202435** |
| **Biotechnology – 3.8%** | **Biotechnology – 3.8%** | **Biotechnology – 3.8%** |
|  AbbVie, Inc. | 71065 | 10403916 |
|  Amgen, Inc.(a) | 106015 | 28661155 |
|  Gilead Sciences, Inc. | 249310 | 19560863 |
|  |  | **58625934** |
| **Building Products – 0.6%** | **Building Products – 0.6%** | **Building Products – 0.6%** |
|  A O Smith Corp.(a) | 110675 | 6062777 |
|  Carrier Global Corp. | 73395 | 2918185 |
|  |  | **8980962** |
| **Capital Markets – 0.8%** | **Capital Markets – 0.8%** | **Capital Markets – 0.8%** |
|  Ameriprise Financial, Inc. | 18640 | 5761997 |
|  Janus Henderson Group plc(a) | 291250 | 6631762 |
|  |  | **12393759** |
| **Chemicals – 1.8%** | **Chemicals – 1.8%** | **Chemicals – 1.8%** |
|  CF Industries Holdings, Inc. | 20970 | 2228272 |
|  Dow, Inc.(a) | 156110 | 7296581 |
|  Eastman Chemical Co.(a) | 69900 | 5369019 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  LyondellBasell Industries NV, Class A | 82715 | $| 6323562 |
|  Olin Corp. | 131645 |  | 6970603 |
|  |  |  | **28188037** |
| **Commercial Services & Supplies – 0.8%** | **Commercial Services & Supplies – 0.8%** | **Commercial Services & Supplies – 0.8%** | **Commercial Services & Supplies – 0.8%** |
|  Cintas Corp.(a) | 5825 |  | 2490479 |
|  Rollins, Inc.(a) | 215525 |  | 9069292 |
|  |  |  | **11559771** |
| **Communications Equipment – 2.5%** | **Communications Equipment – 2.5%** | **Communications Equipment – 2.5%** | **Communications Equipment – 2.5%** |
|  Cisco Systems, Inc. | 822490 |  | 37365721 |
| **Consumer Finance – 1.9%** | **Consumer Finance – 1.9%** | **Consumer Finance – 1.9%** | **Consumer Finance – 1.9%** |
|  Ally Financial, Inc. | 214360 |  | 5907762 |
|  Discover Financial Services | 78055 |  | 8153625 |
|  OneMain Holdings, Inc.(a) | 156110 |  | 6019602 |
|  Synchrony Financial | 257465 |  | 9155455 |
|  |  |  | **29236444** |
| **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** |
|  International Paper Co.(a) | 143295 |  | 4816145 |
| **Diversified Telecommunication Services – 0.9%** | **Diversified Telecommunication Services – 0.9%** | **Diversified Telecommunication Services – 0.9%** | **Diversified Telecommunication Services – 0.9%** |
|  AT&T, Inc. | 452020 |  | 8240325 |
|  Lumen Technologies, Inc.(a) | 726960 |  | 5350425 |
|  |  |  | **13590750** |
| **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** | **Electric Utilities – 1.4%** |
|  Evergy, Inc.(a) | 123490 |  | 7548944 |
|  Southern Co. (The) | 200380 |  | 13120882 |
|  |  |  | **20669826** |
| **Equity Real Estate Investment Trusts (REITs) – 3.8%** | **Equity Real Estate Investment Trusts (REITs) – 3.8%** | **Equity Real Estate Investment Trusts (REITs) – 3.8%** | **Equity Real Estate Investment Trusts (REITs) – 3.8%** |
|  Apartment Income REIT Corp. | 186400 |  | 7163352 |
|  Equity Residential | 113005 |  | 7121575 |
|  Highwoods Properties, Inc.(a) | 198050 |  | 5590952 |
|  Lamar Advertising Co., Class A(a) | 61745 |  | 5694741 |
|  Prologis, Inc. | 71066 |  | 7870560 |
|  Public Storage | 31455 |  | 9743186 |

---

*See Accompanying Notes to the Financial Statements.* 

350 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Regency Centers Corp.(a) | 124655 | 7542874 |
|  Weyerhaeuser Co. | 235330 | 7278757 |
|  |  | **58005997** |
| **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** |
|  Costco Wholesale Corp. | 3495 | 1752742 |
| **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** |
|  Abbott Laboratories | 209700 | 20747718 |
| **Health Care Providers & Services – 2.2%** | **Health Care Providers & Services – 2.2%** | **Health Care Providers & Services – 2.2%** |
|  Cardinal Health, Inc.(a) | 128150 | 9726585 |
|  McKesson Corp. | 29125 | 11340401 |
|  UnitedHealth Group, Inc. | 22135 | 12288245 |
|  |  | **33355231** |
| **Hotels, Restaurants & Leisure – 1.2%** | **Hotels, Restaurants & Leisure – 1.2%** | **Hotels, Restaurants & Leisure – 1.2%** |
|  Boyd Gaming Corp. | 150285 | 8680462 |
|  Domino's Pizza, Inc. | 4660 | 1548238 |
|  International Game Technology plc(a) | 128150 | 2569408 |
|  Red Rock Resorts, Inc., Class A(a) | 24465 | 1018967 |
|  Starbucks Corp. | 4660 | 403509 |
|  Wyndham Hotels & Resorts, Inc. | 48930 | 3715255 |
|  |  | **17935839** |
| **Household Products – 3.4%** | **Household Products – 3.4%** | **Household Products – 3.4%** |
|  Colgate-Palmolive Co. | 34950 | 2580708 |
|  Procter & Gamble Co. (The) | 365810 | 49263633 |
|  |  | **51844341** |
| **Independent Power and Renewable Electricity<br>Producers – 0.3%** | **Independent Power and Renewable Electricity<br>Producers – 0.3%** | **Independent Power and Renewable Electricity<br>Producers – 0.3%** |
|  AES Corp. (The) | 191060 | 4998130 |
| **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** |
|  3M Co. | 111840 | 14068354 |
| **Insurance – 3.9%** | **Insurance – 3.9%** | **Insurance – 3.9%** |
|  Aflac, Inc. | 152615 | 9936763 |
|  Allstate Corp. (The)(a) | 73395 | 9266119 |
|  Lincoln National Corp. | 153780 | 8284128 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  MetLife, Inc. | 146790 | $| 10746496 |
|  Principal Financial Group, Inc.(a) | 114170 |  | 10061802 |
|  Prudential Financial, Inc. | 89705 |  | 9436069 |
|  Travelers Cos., Inc. (The)(a) | 9320 |  | 1719167 |
|  |  |  | **59450544** |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  eBay, Inc. | 124655 |  | 4966255 |
| **IT Services – 6.8%** | **IT Services – 6.8%** | **IT Services – 6.8%** | **IT Services – 6.8%** |
|  Accenture plc, Class A(a) | 62910 |  | 17860149 |
|  Cognizant Technology Solutions Corp., Class A | 53590 |  | 3335978 |
|  International Business Machines Corp.(a) | 168925 |  | 23360638 |
|  Mastercard, Inc., Class A | 48930 |  | 16057847 |
|  Paychex, Inc. | 72230 |  | 8545531 |
|  Visa, Inc., Class A(a) | 136305 |  | 28236944 |
|  Western Union Co. (The)(a) | 469495 |  | 6342878 |
|  |  |  | **103739965** |
| **Machinery – 1.4%** | **Machinery – 1.4%** | **Machinery – 1.4%** | **Machinery – 1.4%** |
|  Illinois Tool Works, Inc. | 59415 |  | 12686885 |
|  Snap-on, Inc.(a) | 37280 |  | 8278024 |
|  |  |  | **20964909** |
| **Marine – 0.1%** | **Marine – 0.1%** | **Marine – 0.1%** | **Marine – 0.1%** |
|  ZIM Integrated Shipping Services Ltd.(a) | 75725 |  | 1778780 |
| **Media – 3.6%** | **Media – 3.6%** | **Media – 3.6%** | **Media – 3.6%** |
|  Comcast Corp., Class A | 759580 |  | 24109069 |
|  Interpublic Group of Cos., Inc. (The) | 264455 |  | 7878115 |
|  Nexstar Media Group, Inc., Class A(a) | 43105 |  | 7383887 |
|  Sirius XM Holdings, Inc.(a) | 1301305 |  | 7859882 |
|  TEGNA, Inc. | 380955 |  | 7954340 |
|  |  |  | **55185293** |
| **Metals & Mining – 1.2%** | **Metals & Mining – 1.2%** | **Metals & Mining – 1.2%** | **Metals & Mining – 1.2%** |
|  Freeport-McMoRan, Inc. | 278435 |  | 8823605 |
|  Nucor Corp.(a) | 68735 |  | 9030404 |
|  |  |  | **17854009** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 351

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** |
|  AGNC Investment Corp.(a) | 667545 | $5487220 |
| **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** | **Multiline Retail – 0.7%** |
|  Dillard's, Inc., Class A(a) | 6990 | 2298242 |
|  Macy's, Inc. | 424060 | 8841651 |
|  |  | **11139893** |
| **Multi-Utilities – 1.0%** | **Multi-Utilities – 1.0%** | **Multi-Utilities – 1.0%** |
|  Public Service Enterprise Group, Inc. | 136305 | 7642621 |
|  WEC Energy Group, Inc. | 83880 | 7660761 |
|  |  | **15303382** |
| **Oil, Gas & Consumable Fuels – 4.2%** | **Oil, Gas & Consumable Fuels – 4.2%** | **Oil, Gas & Consumable Fuels – 4.2%** |
|  APA Corp. | 88540 | 4025028 |
|  Chevron Corp. | 26795 | 4847216 |
|  Devon Energy Corp.(a) | 138635 | 10723417 |
|  Exxon Mobil Corp. | 89705 | 9940211 |
|  Marathon Oil Corp. | 359985 | 10961543 |
|  Occidental Petroleum Corp.(a) | 31455 | 2283633 |
|  Pioneer Natural Resources Co.(a) | 11650 | 2987177 |
|  SM Energy Co. | 195720 | 8803486 |
|  Targa Resources Corp. | 126985 | 8681964 |
|  |  | **63253675** |
| **Paper & Forest Products – 0.4%** | **Paper & Forest Products – 0.4%** | **Paper & Forest Products – 0.4%** |
|  Louisiana-Pacific Corp.(a) | 121160 | 6863714 |
| **Pharmaceuticals – 7.5%** | **Pharmaceuticals – 7.5%** | **Pharmaceuticals – 7.5%** |
|  Eli Lilly & Co. | 114170 | 41339815 |
|  Johnson & Johnson | 306395 | 53303538 |
|  Merck & Co., Inc. | 11650 | 1178980 |
|  Pfizer, Inc. | 406585 | 18926532 |
|  |  | **114748865** |
| **Professional Services – 0.4%** | **Professional Services – 0.4%** | **Professional Services – 0.4%** |
|  Robert Half International, Inc. | 73395 | 5611782 |
| **Road & Rail – 2.0%** | **Road & Rail – 2.0%** | **Road & Rail – 2.0%** |
|  Old Dominion Freight Line, Inc.(a) | 27960 | 7677816 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  Union Pacific Corp. | 111840 | $| 22048138 |
|  |  |  | **29725954** |
| **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** | **Semiconductors & Semiconductor Equipment – 4.3%** |
|  Applied Materials, Inc. | 173585 |  | 15325820 |
|  Broadcom, Inc. | 76890 |  | 36147527 |
|  NVIDIA Corp. | 53590 |  | 7233042 |
|  Teradyne, Inc. | 90870 |  | 7392274 |
|  |  |  | **66098663** |
| **Software – 5.5%** | **Software – 5.5%** | **Software – 5.5%** | **Software – 5.5%** |
|  Microsoft Corp. | 265620 |  | 61658370 |
|  NortonLifeLock, Inc. | 368140 |  | 8294194 |
|  Oracle Corp.(a) | 72230 |  | 5638996 |
|  Roper Technologies, Inc. | 18640 |  | 7727026 |
|  |  |  | **83318586** |
| **Specialty Retail – 4.9%** | **Specialty Retail – 4.9%** | **Specialty Retail – 4.9%** | **Specialty Retail – 4.9%** |
|  Bath & Body Works, Inc. | 199215 |  | 6649797 |
|  Best Buy Co., Inc.(a) | 109510 |  | 7491579 |
|  Dick's Sporting Goods, Inc.(a) | 67570 |  | 7686763 |
|  Home Depot, Inc. (The)(a) | 90870 |  | 26909333 |
|  Lowe's Cos., Inc. | 99025 |  | 19304924 |
|  Williams-Sonoma, Inc.(a) | 52425 |  | 6491788 |
|  |  |  | **74534184** |
| **Technology Hardware, Storage & Peripherals – 9.1%** | **Technology Hardware, Storage & Peripherals – 9.1%** | **Technology Hardware, Storage & Peripherals – 9.1%** | **Technology Hardware, Storage & Peripherals – 9.1%** |
|  Apple, Inc. | 876080 |  | 134338107 |
|  Seagate Technology Holdings plc | 85045 |  | 4223335 |
|  |  |  | **138561442** |
| **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** | **Textiles, Apparel & Luxury Goods – 1.4%** |
|  NIKE, Inc., Class B | 85045 |  | 7881971 |
|  Ralph Lauren Corp.(a) | 67570 |  | 6263063 |
|  Tapestry, Inc. | 229505 |  | 7270718 |
|  |  |  | **21415752** |
| **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** |
|  Radian Group, Inc.(a) | 363480 |  | 7585828 |
| **Tobacco – 2.9%** | **Tobacco – 2.9%** | **Tobacco – 2.9%** | **Tobacco – 2.9%** |
|  Altria Group, Inc. | 358820 |  | 16602601 |

---

*See Accompanying Notes to the Financial Statements.* 

352 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Quality Dividend Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Tobacco – (continued)** | **Tobacco – (continued)** | **Tobacco – (continued)** | **Tobacco – (continued)** |
|  Philip Morris International, Inc. | 307560 | $| 28249386 |
|  |  |  | **44851987** |
| **Trading Companies & Distributors – 0.5%** | **Trading Companies & Distributors – 0.5%** | **Trading Companies & Distributors – 0.5%** | **Trading Companies & Distributors – 0.5%** |
|  Fastenal Co.(a) | 164265 |  | 7938927 |
| **Total Common Stocks <br>(Cost $1,375,589,496)** | **Total Common Stocks <br>(Cost $1,375,589,496)** |  | **1515318768** |
|  | Principal<br>Amount |  |  |
| **SECURITIES LENDING REINVESTMENTS(b) – 16.0%** | **SECURITIES LENDING REINVESTMENTS(b) – 16.0%** | **SECURITIES LENDING REINVESTMENTS(b) – 16.0%** | **SECURITIES LENDING REINVESTMENTS(b) – 16.0%** |
| **CERTIFICATES OF DEPOSIT – 1.1%** | **CERTIFICATES OF DEPOSIT – 1.1%** | **CERTIFICATES OF DEPOSIT – 1.1%** | **CERTIFICATES OF DEPOSIT – 1.1%** |
|  Barclays Bank plc, New York (SOFR + 0.52%), 3.56%, 4/5/2023(c) | $2000000 |  | 1998196 |
|  Credit Agricole CIB, New York (SOFR + 0.68%), 3.73%, 4/25/2023(c) | 3000000 |  | 2999700 |
|  MUFG Bank Ltd., New York Branch (SOFR + 0.59%), 3.63%, 2/10/2023(c) | 3000000 |  | 3000069 |
|  Royal Bank of Canada (US Federal Funds Effective Rate (continuous series) + 0.37%), 3.45%, 12/2/2022(c) | 4000000 |  | 4000000 |
|  The Sumitomo Bank Ltd., New York (SOFR + 0.75%), 3.80%, 4/21/2023(c) | 4000000 |  | 4000028 |
| **Total Certificates of Deposit <br>(Cost $16,000,000)** | **Total Certificates of Deposit <br>(Cost $16,000,000)** |  | **15997993** |
| **COMMERCIAL PAPER – 0.2%** | **COMMERCIAL PAPER – 0.2%** | **COMMERCIAL PAPER – 0.2%** | **COMMERCIAL PAPER – 0.2%** |
|  Macquarie Bank Ltd. (SOFR + 0.31%), 3.35%, 11/3/2022(c) (Cost $3,000,000) | 3000000 |  | 3000000 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – 14.7%** | **REPURCHASE AGREEMENTS – 14.7%** | **REPURCHASE AGREEMENTS – 14.7%** |
|  BofA Securities, Inc., 3.52%, dated 10/31/2022, due 1/31/2023, repurchase price $8,071,964, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 4.13%, maturing 11/15/2023 – 2/15/2051; total market value $8,112,388 | $8000000 | $8000000 |
|  CF Secured LLC, 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $30,002,500, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2022 – 8/15/2052; total market value $30,437,030 | 30000000 | 30000000 |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $161,450,128, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $162,583,312 | 161436675 | 161436675 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 353

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $15,008,954, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $15,205,532 | $| 15000000 | $15000000 |
|  Societe Generale, New York Branch, 3.05%, dated 10/31/2022, due 11/7/2022, repurchase price $10,005,931, collateralized by various U.S. Treasury Securities, ranging from 0.63% – 2.88%, maturing 7/31/2026 – 7/31/2028; total market value $10,115,960 |  | 10000000 | 10000000 |
| **Total Repurchase Agreements <br>(Cost $224,436,675)** | **Total Repurchase Agreements <br>(Cost $224,436,675)** | **Total Repurchase Agreements <br>(Cost $224,436,675)** | **224436675** |
| **Total Securities Lending Reinvestments <br>(Cost $243,436,675)** | **Total Securities Lending Reinvestments <br>(Cost $243,436,675)** | **Total Securities Lending Reinvestments <br>(Cost $243,436,675)** | **243434668** |
| **Total Investments – 115.5% <br>(Cost $1,619,026,171)** | **Total Investments – 115.5% <br>(Cost $1,619,026,171)** | **Total Investments – 115.5% <br>(Cost $1,619,026,171)** | **1758753436** |
|  Liabilities in excess of other assets – (15.5%) | Liabilities in excess of other assets – (15.5%) | Liabilities in excess of other assets – (15.5%) | (236023617) |
| **NET ASSETS – 100.0%** |  |  | $**1522729819** |

---

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $288,651,348, collateralized in the form of cash with a value of $243,436,675 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $53,407,829 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 15, 2022 – May 15, 2052 and $119,097 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 4.75%, and maturity dates ranging from May 25, 2023 – March 22, 2052; a total value of $296,963,601.* 

*<sup>(b)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $243,434,668.* 

*<sup>(c)</sup>* *Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*SOFR – Secured Overnight Financing Rate* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $244239919 |
|  Aggregate gross unrealized depreciation | (105286265) |
|  Net unrealized appreciation | $138953654 |
|  Federal income tax cost | $1619846212 |

---

*See Accompanying Notes to the Financial Statements.* 

354 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Index Fund (cont.)

------

**Futures Contracts** 

*FlexShares<sup>®</sup> Quality Dividend Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  S&P 500 E-Mini Index | 31 | 12/16/2022 | USD | $6018650 | $(15018) |
|  S&P Midcap 400 E-Mini Index | 4 | 12/16/2022 | USD | 975840 | 61448 |
|  |  |  |  |  | $46430 |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 99.5% |
|  Securities Lending Reinvestments | 16.0 |
|  Others<sup>(1)</sup> | (15.5) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 355

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##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.4%** | **COMMON STOCKS – 98.4%** | **COMMON STOCKS – 98.4%** |
| **Aerospace & Defense – 1.5%** | **Aerospace & Defense – 1.5%** | **Aerospace & Defense – 1.5%** |
|  Lockheed Martin Corp. | 10647 | $5181682 |
| **Air Freight & Logistics – 2.1%** | **Air Freight & Logistics – 2.1%** | **Air Freight & Logistics – 2.1%** |
|  Expeditors International of Washington, Inc.(a) | 18837 | 1843201 |
|  United Parcel Service, Inc., Class B(a) | 33033 | 5541946 |
|  |  | **7385147** |
| **Banks – 4.6%** | **Banks – 4.6%** | **Banks – 4.6%** |
|  Bank of America Corp. | 12558 | 452590 |
|  JPMorgan Chase & Co. | 86268 | 10859416 |
|  Prosperity Bancshares, Inc.(a) | 24843 | 1778014 |
|  US Bancorp | 62790 | 2665435 |
|  |  | **15755455** |
| **Beverages – 1.1%** | **Beverages – 1.1%** | **Beverages – 1.1%** |
|  Coca-Cola Co. (The) | 53781 | 3218793 |
|  PepsiCo, Inc. | 2184 | 396571 |
|  |  | **3615364** |
| **Biotechnology – 5.6%** | **Biotechnology – 5.6%** | **Biotechnology – 5.6%** |
|  AbbVie, Inc. | 58695 | 8592948 |
|  Amgen, Inc. | 24024 | 6494888 |
|  Gilead Sciences, Inc. | 55965 | 4391014 |
|  |  | **19478850** |
| **Building Products – 0.4%** | **Building Products – 0.4%** | **Building Products – 0.4%** |
|  A O Smith Corp.(a) | 24843 | 1360899 |
| **Capital Markets – 0.7%** | **Capital Markets – 0.7%** | **Capital Markets – 0.7%** |
|  Bank of New York Mellon Corp. (The) | 20748 | 873698 |
|  Janus Henderson Group plc | 65247 | 1485674 |
|  |  | **2359372** |
| **Chemicals – 1.9%** | **Chemicals – 1.9%** | **Chemicals – 1.9%** |
|  CF Industries Holdings, Inc.(a) | 19656 | 2088647 |
|  Dow, Inc. | 34671 | 1620522 |
|  LyondellBasell Industries NV, Class A | 18291 | 1398347 |
|  Olin Corp. | 29484 | 1561178 |
|  |  | **6668694** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** |
|  Rollins, Inc.(a) | 51324 | $2159714 |
| **Communications Equipment – 2.4%** | **Communications Equipment – 2.4%** | **Communications Equipment – 2.4%** |
|  Cisco Systems, Inc. | 185094 | 8408820 |
| **Consumer Finance – 0.7%** | **Consumer Finance – 0.7%** | **Consumer Finance – 0.7%** |
|  OneMain Holdings, Inc. | 37947 | 1463236 |
|  SLM Corp. | 50505 | 837878 |
|  |  | **2301114** |
| **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** |
|  International Paper Co. | 9555 | 321144 |
| **Diversified Consumer Services – 0.5%** | **Diversified Consumer Services – 0.5%** | **Diversified Consumer Services – 0.5%** |
|  H&R Block, Inc.(a) | 40404 | 1662625 |
| **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** |
|  AT&T, Inc. | 126945 | 2314207 |
|  Lumen Technologies, Inc.(a) | 161343 | 1187485 |
|  |  | **3501692** |
| **Electric Utilities – 1.6%** | **Electric Utilities – 1.6%** | **Electric Utilities – 1.6%** |
|  Evergy, Inc. | 27846 | 1702226 |
|  Exelon Corp. | 47229 | 1822567 |
|  PPL Corp. | 20202 | 535151 |
|  Southern Co. (The) | 20748 | 1358579 |
|  |  | **5418523** |
| **Equity Real Estate Investment Trusts (REITs) – 4.2%** | **Equity Real Estate Investment Trusts (REITs) – 4.2%** | **Equity Real Estate Investment Trusts (REITs) – 4.2%** |
|  American Tower Corp. | 17199 | 3563461 |
|  Apartment Income REIT Corp. | 31395 | 1206510 |
|  Equity Residential | 25116 | 1582810 |
|  Highwoods Properties, Inc. | 8736 | 246617 |
|  Mid-America Apartment Communities, Inc. | 10101 | 1590402 |
|  Prologis, Inc. | 23205 | 2569993 |
|  Public Storage | 7098 | 2198605 |
|  Terreno Realty Corp. | 29211 | 1669117 |
|  |  | **14627515** |
| **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** |
|  Costco Wholesale Corp. | 546 | 273819 |

---

*See Accompanying Notes to the Financial Statements.* 

356 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Equipment & Supplies – 2.2%** | **Health Care Equipment & Supplies – 2.2%** | **Health Care Equipment & Supplies – 2.2%** |
|  Abbott Laboratories | 78351 | $7752048 |
| **Health Care Providers & Services – 1.4%** | **Health Care Providers & Services – 1.4%** | **Health Care Providers & Services – 1.4%** |
|  Chemed Corp. | 3822 | 1784377 |
|  UnitedHealth Group, Inc. | 5187 | 2879563 |
|  |  | **4663940** |
| **Hotels, Restaurants & Leisure – 3.4%** | **Hotels, Restaurants & Leisure – 3.4%** | **Hotels, Restaurants & Leisure – 3.4%** |
|  Domino's Pizza, Inc. | 4914 | 1632627 |
|  McDonald's Corp. | 33033 | 9006778 |
|  Starbucks Corp. | 14469 | 1252871 |
|  |  | **11892276** |
| **Household Products – 4.1%** | **Household Products – 4.1%** | **Household Products – 4.1%** |
|  Clorox Co. (The) | 9555 | 1395412 |
|  Kimberly-Clark Corp. | 13104 | 1630924 |
|  Procter & Gamble Co. (The) | 82446 | 11103003 |
|  |  | **14129339** |
| **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** |
|  AES Corp. (The)(a) | 67158 | 1756853 |
| **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** |
|  3M Co. | 25389 | 3193682 |
| **Insurance – 4.8%** | **Insurance – 4.8%** | **Insurance – 4.8%** |
|  Aflac, Inc. | 34671 | 2257429 |
|  Allstate Corp. (The) | 16380 | 2067975 |
|  American Financial Group, Inc. | 12558 | 1822291 |
|  Assurant, Inc. | 11193 | 1520681 |
|  Globe Life, Inc. | 18564 | 2144513 |
|  MetLife, Inc. | 33852 | 2478305 |
|  Travelers Cos., Inc. (The) | 12558 | 2316449 |
|  Willis Towers Watson plc(a) | 9555 | 2084996 |
|  |  | **16692639** |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  eBay, Inc. | 28392 | 1131137 |
| **IT Services – 6.9%** | **IT Services – 6.9%** | **IT Services – 6.9%** |
|  International Business Machines Corp. | 40404 | 5587469 |
|  Jack Henry & Associates, Inc. | 9555 | 1902018 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  Mastercard, Inc., Class A | 3003 | $| 985525 |
|  Maximus, Inc.(a) | 29757 |  | 1835114 |
|  Paychex, Inc. | 16107 |  | 1905619 |
|  Visa, Inc., Class A(a) | 49140 |  | 10179843 |
|  Western Union Co. (The) | 116571 |  | 1574874 |
|  |  |  | **23970462** |
| **Machinery – 1.7%** | **Machinery – 1.7%** | **Machinery – 1.7%** | **Machinery – 1.7%** |
|  Illinois Tool Works, Inc. | 13377 |  | 2856391 |
|  Otis Worldwide Corp. | 15015 |  | 1060660 |
|  Snap-on, Inc.(a) | 8463 |  | 1879209 |
|  |  |  | **5796260** |
| **Marine – 0.2%** | **Marine – 0.2%** | **Marine – 0.2%** | **Marine – 0.2%** |
|  ZIM Integrated Shipping Services Ltd.(a) | 25935 |  | 609213 |
| **Media – 3.6%** | **Media – 3.6%** | **Media – 3.6%** | **Media – 3.6%** |
|  Comcast Corp., Class A | 174447 |  | 5536948 |
|  Interpublic Group of Cos., Inc. (The) | 59514 |  | 1772922 |
|  Nexstar Media Group, Inc., Class A | 9555 |  | 1636771 |
|  Sirius XM Holdings, Inc.(a) | 297843 |  | 1798972 |
|  TEGNA, Inc. | 84903 |  | 1772775 |
|  |  |  | **12518388** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** |
|  AGNC Investment Corp.(a) | 149058 |  | 1225257 |
| **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** | **Multiline Retail – 0.5%** |
|  Dillard's, Inc., Class A(a) | 5733 |  | 1884953 |
| **Multi-Utilities – 2.0%** | **Multi-Utilities – 2.0%** | **Multi-Utilities – 2.0%** | **Multi-Utilities – 2.0%** |
|  CMS Energy Corp. | 28665 |  | 1635338 |
|  DTE Energy Co. | 15288 |  | 1713938 |
|  Public Service Enterprise Group, Inc. | 30849 |  | 1729703 |
|  WEC Energy Group, Inc. | 19929 |  | 1820116 |
|  |  |  | **6899095** |
| **Oil, Gas & Consumable Fuels – 1.6%** | **Oil, Gas & Consumable Fuels – 1.6%** | **Oil, Gas & Consumable Fuels – 1.6%** | **Oil, Gas & Consumable Fuels – 1.6%** |
|  Chevron Corp. | 6006 |  | 1086485 |
|  CVR Energy, Inc.(a) | 9555 |  | 373218 |
|  Exxon Mobil Corp. | 26208 |  | 2904109 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 357

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Pioneer Natural Resources Co.(a) | 4641 | $| 1189999 |
|  |  |  | **5553811** |
| **Pharmaceuticals – 7.6%** | **Pharmaceuticals – 7.6%** | **Pharmaceuticals – 7.6%** | **Pharmaceuticals – 7.6%** |
|  Eli Lilly & Co. | 34671 |  | 12554022 |
|  Johnson & Johnson | 61698 |  | 10733601 |
|  Merck & Co., Inc. | 4368 |  | 442042 |
|  Pfizer, Inc. | 54873 |  | 2554338 |
|  |  |  | **26284003** |
| **Professional Services – 0.6%** | **Professional Services – 0.6%** | **Professional Services – 0.6%** | **Professional Services – 0.6%** |
|  Booz Allen Hamilton Holding Corp. | 19929 |  | 2169272 |
| **Road & Rail – 0.5%** | **Road & Rail – 0.5%** | **Road & Rail – 0.5%** | **Road & Rail – 0.5%** |
|  Old Dominion Freight Line, Inc.(a) | 6279 |  | 1724213 |
| **Semiconductors & Semiconductor Equipment – 2.9%** | **Semiconductors & Semiconductor Equipment – 2.9%** | **Semiconductors & Semiconductor Equipment – 2.9%** | **Semiconductors & Semiconductor Equipment – 2.9%** |
|  Broadcom, Inc. | 18018 |  | 8470622 |
|  NVIDIA Corp. | 12012 |  | 1621260 |
|  |  |  | **10091882** |
| **Software – 5.5%** | **Software – 5.5%** | **Software – 5.5%** | **Software – 5.5%** |
|  Microsoft Corp. | 59787 |  | 13878356 |
|  NortonLifeLock, Inc. | 84084 |  | 1894413 |
|  Oracle Corp. | 30576 |  | 2387068 |
|  Roper Technologies, Inc. | 1638 |  | 679017 |
|  |  |  | **18838854** |
| **Specialty Retail – 4.3%** | **Specialty Retail – 4.3%** | **Specialty Retail – 4.3%** | **Specialty Retail – 4.3%** |
|  Best Buy Co., Inc. | 24570 |  | 1680834 |
|  Home Depot, Inc. (The) | 34125 |  | 10105436 |
|  Lowe's Cos., Inc. | 8736 |  | 1703083 |
|  Williams-Sonoma, Inc.(a) | 10101 |  | 1250807 |
|  |  |  | **14740160** |
| **Technology Hardware, Storage & Peripherals – 9.4%** | **Technology Hardware, Storage & Peripherals – 9.4%** | **Technology Hardware, Storage & Peripherals – 9.4%** | **Technology Hardware, Storage & Peripherals – 9.4%** |
|  Apple, Inc. | 197652 |  | 30307959 |
|  HP, Inc.(a) | 38220 |  | 1055636 |
|  Seagate Technology Holdings plc | 18564 |  | 921888 |
|  |  |  | **32285483** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** | **Thrifts & Mortgage Finance – 0.5%** |
|  Radian Group, Inc. | 82992 | $1732043 |
| **Tobacco – 2.9%** | **Tobacco – 2.9%** | **Tobacco – 2.9%** |
|  Altria Group, Inc. | 80808 | 3738986 |
|  Philip Morris International, Inc. | 69342 | 6369063 |
|  |  | **10108049** |
| **Water Utilities – 0.6%** | **Water Utilities – 0.6%** | **Water Utilities – 0.6%** |
|  American Water Works Co., Inc. | 13104 | 1904535 |
| **Total Common Stocks <br>(Cost $318,037,114)** | **Total Common Stocks <br>(Cost $318,037,114)** | **340028276** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(b) – 4.9%** | **SECURITIES LENDING REINVESTMENTS(b) – 4.9%** | **SECURITIES LENDING REINVESTMENTS(b) – 4.9%** |
| **REPURCHASE AGREEMENTS – 4.9%** | **REPURCHASE AGREEMENTS – 4.9%** | **REPURCHASE AGREEMENTS – 4.9%** |
|  BofA Securities, Inc., 3.52%, dated 10/31/2022, due 1/31/2023, repurchase price $1,008,996, collateralized by various U.S. Treasury Securities, ranging from 0.13% – 4.13%, maturing 11/15/2023 – 2/15/2051; total market value $1,014,049 | $1000000 | 1000000 |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $10,950,650, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $11,027,510 | 10949737 | 10949737 |

---

*See Accompanying Notes to the Financial Statements.* 

358 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Quality Dividend Defensive Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** | **REPURCHASE AGREEMENTS – (continued)** |
|  National Bank of Canada, 3.07%, dated 10/31/2022, due 11/7/2022, repurchase price $5,002,985, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 3.13%, maturing 12/1/2022 – 8/15/2052; total market value $5,068,511 | $| 5000000 | $5000000 |
|  |  |  | **16949737** |
| **Total Securities Lending Reinvestments <br>(COST $16,949,737)** | **Total Securities Lending Reinvestments <br>(COST $16,949,737)** | **Total Securities Lending Reinvestments <br>(COST $16,949,737)** | **16949737** |
| **Total Investments – 103.3% <br>(Cost $334,986,851)** | **Total Investments – 103.3% <br>(Cost $334,986,851)** | **Total Investments – 103.3% <br>(Cost $334,986,851)** | **356978013** |
|  Liabilities in excess of other assets – (3.3%) | Liabilities in excess of other assets – (3.3%) | Liabilities in excess of other assets – (3.3%) | (11534435) |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**345443578** |

---

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $35,270,721, collateralized in the form of cash with a value of $16,949,737 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $19,228,156 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 15, 2022 – May 15, 2052 and $17 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from July 15, 2023 – June 30, 2120; a total value of $36,177,910.* 

*<sup>(b)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $16,949,737.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $43747976 |
|  Aggregate gross unrealized depreciation | (21899173) |
|  Net unrealized appreciation | $21848803 |
|  Federal income tax cost | $335090456 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  S&P 500 E-Mini Index | 28 | 12/16/2022 | USD | $5436200 | $(38754) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.4% |
|  Securities Lending Reinvestments | 4.9 |
|  Others<sup>(1)</sup> | (3.3) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 359

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 97.9%** | **COMMON STOCKS – 97.9%** | **COMMON STOCKS – 97.9%** |
| **Air Freight & Logistics – 1.6%** | **Air Freight & Logistics – 1.6%** | **Air Freight & Logistics – 1.6%** |
|  United Parcel Service, Inc., Class B | 1703 | $285712 |
| **Banks – 5.4%** | **Banks – 5.4%** | **Banks – 5.4%** |
|  Bank of America Corp. | 741 | 26706 |
|  Citigroup, Inc. | 4472 | 205086 |
|  Comerica, Inc. | 1157 | 81569 |
|  Cullen/Frost Bankers, Inc. | 715 | 110861 |
|  JPMorgan Chase & Co. | 4355 | 548207 |
|  US Bancorp | 143 | 6070 |
|  |  | **978499** |
| **Beverages – 0.3%** | **Beverages – 0.3%** | **Beverages – 0.3%** |
|  Coca-Cola Co. (The) | 468 | 28010 |
|  PepsiCo, Inc. | 117 | 21245 |
|  |  | **49255** |
| **Biotechnology – 2.7%** | **Biotechnology – 2.7%** | **Biotechnology – 2.7%** |
|  AbbVie, Inc. | 1027 | 150353 |
|  Amgen, Inc. | 1248 | 337397 |
|  |  | **487750** |
| **Building Products – 1.3%** | **Building Products – 1.3%** | **Building Products – 1.3%** |
|  A O Smith Corp. | 1469 | 80472 |
|  Masco Corp. | 1365 | 63158 |
|  Owens Corning(a) | 1092 | 93486 |
|  |  | **237116** |
| **Capital Markets – 1.1%** | **Capital Markets – 1.1%** | **Capital Markets – 1.1%** |
|  Ameriprise Financial, Inc. | 390 | 120557 |
|  Janus Henderson Group plc(a) | 3354 | 76370 |
|  |  | **196927** |
| **Chemicals – 2.0%** | **Chemicals – 2.0%** | **Chemicals – 2.0%** |
|  Chemours Co. (The) | 2665 | 76299 |
|  Dow, Inc. | 2015 | 94181 |
|  Eastman Chemical Co. | 819 | 62907 |
|  LyondellBasell Industries NV, Class A | 949 | 72551 |
|  Olin Corp. | 962 | 50938 |
|  |  | **356876** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** | **Commercial Services & Supplies – 0.6%** |
|  Cintas Corp. | 260 | $111163 |
| **Communications Equipment – 2.4%** | **Communications Equipment – 2.4%** | **Communications Equipment – 2.4%** |
|  Cisco Systems, Inc. | 9568 | 434674 |
| **Consumer Finance – 2.0%** | **Consumer Finance – 2.0%** | **Consumer Finance – 2.0%** |
|  Ally Financial, Inc. | 858 | 23646 |
|  Capital One Financial Corp. | 1014 | 107504 |
|  Discover Financial Services | 949 | 99133 |
|  OneMain Holdings, Inc. | 1144 | 44113 |
|  Synchrony Financial | 2392 | 85059 |
|  |  | **359455** |
| **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** |
|  International Paper Co. | 1079 | 36265 |
| **Diversified Financial Services – 0.9%** | **Diversified Financial Services – 0.9%** | **Diversified Financial Services – 0.9%** |
|  Equitable Holdings, Inc. | 2522 | 77224 |
|  Voya Financial, Inc.(a) | 1261 | 86202 |
|  |  | **163426** |
| **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** | **Diversified Telecommunication Services – 1.0%** |
|  AT&T, Inc. | 6474 | 118021 |
|  Lumen Technologies, Inc.(a) | 8567 | 63053 |
|  |  | **181074** |
| **Electric Utilities – 0.4%** | **Electric Utilities – 0.4%** | **Electric Utilities – 0.4%** |
|  PPL Corp. | 2561 | 67841 |
| **Equity Real Estate Investment Trusts (REITs) – 3.4%** | **Equity Real Estate Investment Trusts (REITs) – 3.4%** | **Equity Real Estate Investment Trusts (REITs) – 3.4%** |
|  Brixmor Property Group, Inc. | 4095 | 87265 |
|  Equity Residential | 1339 | 84384 |
|  Highwoods Properties, Inc. | 2392 | 67526 |
|  Lamar Advertising Co., Class A | 975 | 89924 |
|  Regency Centers Corp. | 1430 | 86529 |
|  Simon Property Group, Inc. | 949 | 103422 |
|  Weyerhaeuser Co. | 2925 | 90470 |
|  |  | **609520** |
| **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** |
|  Costco Wholesale Corp. | 39 | 19559 |
| **Health Care Equipment & Supplies – 2.2%** | **Health Care Equipment & Supplies – 2.2%** | **Health Care Equipment & Supplies – 2.2%** |
|  Abbott Laboratories | 4069 | 402587 |

---

*See Accompanying Notes to the Financial Statements.* 

360 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Health Care Providers & Services – 1.4%** | **Health Care Providers & Services – 1.4%** | **Health Care Providers & Services – 1.4%** |
|  Cardinal Health, Inc.(a) | 1417 | $107550 |
|  UnitedHealth Group, Inc. | 260 | 144339 |
|  |  | **251889** |
| **Hotels, Restaurants & Leisure – 2.1%** | **Hotels, Restaurants & Leisure – 2.1%** | **Hotels, Restaurants & Leisure – 2.1%** |
|  Boyd Gaming Corp. | 1755 | 101369 |
|  International Game Technology plc | 4485 | 89924 |
|  Red Rock Resorts, Inc., Class A | 2405 | 100168 |
|  Wyndham Hotels & Resorts, Inc. | 1066 | 80942 |
|  |  | **372403** |
| **Household Products – 0.6%** | **Household Products – 0.6%** | **Household Products – 0.6%** |
|  Procter & Gamble Co. (The) | 871 | 117298 |
| **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** | **Independent Power and Renewable Electricity<br>Producers – 0.5%** |
|  AES Corp. (The) | 3315 | 86720 |
| **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** | **Industrial Conglomerates – 0.9%** |
|  3M Co. | 1313 | 165162 |
| **Insurance – 4.0%** | **Insurance – 4.0%** | **Insurance – 4.0%** |
|  Aflac, Inc. | 1781 | 115961 |
|  American International Group, Inc. | 533 | 30381 |
|  Lincoln National Corp. | 1963 | 105747 |
|  MetLife, Inc. | 1755 | 128483 |
|  Principal Financial Group, Inc. | 1352 | 119152 |
|  Prudential Financial, Inc. | 1079 | 113500 |
|  Unum Group | 2535 | 115571 |
|  |  | **728795** |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  eBay, Inc. | 1456 | 58007 |
| **IT Services – 6.4%** | **IT Services – 6.4%** | **IT Services – 6.4%** |
|  Accenture plc, Class A | 1131 | 321091 |
|  Genpact Ltd. | 234 | 11349 |
|  International Business Machines Corp. | 1976 | 273261 |
|  Mastercard, Inc., Class A | 936 | 307177 |
|  Paychex, Inc. | 845 | 99972 |
|  Visa, Inc., Class A(a) | 377 | 78099 |
|  Western Union Co. (The) | 4641 | 62700 |
|  |  | **1153649** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Machinery – 1.9%** | **Machinery – 1.9%** | **Machinery – 1.9%** |
|  Crane Holdings Co. | 923 | $92614 |
|  Illinois Tool Works, Inc. | 715 | 152674 |
|  Snap-on, Inc. | 442 | 98146 |
|  |  | **343434** |
| **Marine – 0.3%** | **Marine – 0.3%** | **Marine – 0.3%** |
|  ZIM Integrated Shipping Services Ltd.(a) | 1963 | 46111 |
| **Media – 3.4%** | **Media – 3.4%** | **Media – 3.4%** |
|  Comcast Corp., Class A | 8242 | 261601 |
|  Interpublic Group of Cos., Inc. (The) | 3146 | 93719 |
|  Nexstar Media Group, Inc., Class A | 494 | 84622 |
|  Sirius XM Holdings, Inc.(a) | 14885 | 89906 |
|  TEGNA, Inc. | 4511 | 94190 |
|  |  | **624038** |
| **Metals & Mining – 1.6%** | **Metals & Mining – 1.6%** | **Metals & Mining – 1.6%** |
|  Freeport-McMoRan, Inc. | 3484 | 110408 |
|  Nucor Corp. | 806 | 105892 |
|  United States Steel Corp.(a) | 3900 | 79404 |
|  |  | **295704** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** |
|  AGNC Investment Corp.(a) | 7683 | 63154 |
| **Multiline Retail – 0.6%** | **Multiline Retail – 0.6%** | **Multiline Retail – 0.6%** |
|  Macy's, Inc. | 4849 | 101102 |
| **Oil, Gas & Consumable Fuels – 6.9%** | **Oil, Gas & Consumable Fuels – 6.9%** | **Oil, Gas & Consumable Fuels – 6.9%** |
|  APA Corp. | 2782 | 126470 |
|  Chevron Corp. | 299 | 54089 |
|  Devon Energy Corp.(a) | 1664 | 128711 |
|  Diamondback Energy, Inc. | 793 | 124588 |
|  Exxon Mobil Corp. | 1378 | 152696 |
|  Magnolia Oil & Gas Corp., Class A(a) | 4056 | 104158 |
|  Marathon Oil Corp. | 4225 | 128651 |
|  Occidental Petroleum Corp.(a) | 2184 | 158558 |
|  Pioneer Natural Resources Co.(a) | 234 | 60000 |
|  SM Energy Co. | 2262 | 101745 |
|  Targa Resources Corp. | 1495 | 102213 |
|  |  | **1241879** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 361

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** | **Paper & Forest Products – 0.5%** |
|  Louisiana-Pacific Corp.(a) | 1677 | $95002 |
| **Pharmaceuticals – 6.9%** | **Pharmaceuticals – 6.9%** | **Pharmaceuticals – 6.9%** |
|  Eli Lilly & Co. | 78 | 28243 |
|  Johnson & Johnson | 3809 | 662652 |
|  Merck & Co., Inc. | 234 | 23681 |
|  Pfizer, Inc. | 11323 | 527085 |
|  |  | **1241661** |
| **Professional Services – 0.7%** | **Professional Services – 0.7%** | **Professional Services – 0.7%** |
|  Korn Ferry | 624 | 34688 |
|  Robert Half International, Inc. | 1209 | 92440 |
|  |  | **127128** |
| **Road & Rail – 2.1%** | **Road & Rail – 2.1%** | **Road & Rail – 2.1%** |
|  Old Dominion Freight Line, Inc.(a) | 364 | 99954 |
|  Union Pacific Corp. | 1443 | 284473 |
|  |  | **384427** |
| **Semiconductors & Semiconductor Equipment – 4.9%** | **Semiconductors & Semiconductor Equipment – 4.9%** | **Semiconductors & Semiconductor Equipment – 4.9%** |
|  Applied Materials, Inc. | 2028 | 179052 |
|  Broadcom, Inc. | 858 | 403363 |
|  Lam Research Corp. | 325 | 131554 |
|  Microchip Technology, Inc. | 1300 | 80262 |
|  NVIDIA Corp. | 624 | 84221 |
|  |  | **878452** |
| **Software – 5.4%** | **Software – 5.4%** | **Software – 5.4%** |
|  Microsoft Corp. | 3107 | 721228 |
|  NortonLifeLock, Inc. | 4290 | 96654 |
|  Oracle Corp. | 585 | 45671 |
|  Roper Technologies, Inc. | 260 | 107780 |
|  |  | **971333** |
| **Specialty Retail – 4.9%** | **Specialty Retail – 4.9%** | **Specialty Retail – 4.9%** |
|  Bath & Body Works, Inc. | 1209 | 40356 |
|  Best Buy Co., Inc. | 1261 | 86265 |
|  Dick's Sporting Goods, Inc.(a) | 897 | 102043 |
|  Home Depot, Inc. (The) | 962 | 284877 |
|  Lowe's Cos., Inc. | 1482 | 288916 |
|  Williams-Sonoma, Inc. | 624 | 77270 |
|  |  | **879727** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Technology Hardware, Storage & Peripherals – 8.9%** | **Technology Hardware, Storage & Peripherals – 8.9%** | **Technology Hardware, Storage & Peripherals – 8.9%** |
|  Apple, Inc. | 10231 | $1568821 |
|  Seagate Technology Holdings plc | 962 | 47773 |
|  |  | **1616594** |
| **Textiles, Apparel & Luxury Goods – 0.9%** | **Textiles, Apparel & Luxury Goods – 0.9%** | **Textiles, Apparel & Luxury Goods – 0.9%** |
|  Ralph Lauren Corp. | 806 | 74708 |
|  Tapestry, Inc. | 2652 | 84016 |
|  |  | **158724** |
| **Tobacco – 2.8%** | **Tobacco – 2.8%** | **Tobacco – 2.8%** |
|  Altria Group, Inc. | 4173 | 193085 |
|  Philip Morris International, Inc. | 3445 | 316423 |
|  |  | **509508** |
| **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** |
|  Fastenal Co. | 1924 | 92987 |
|  WW Grainger, Inc. | 182 | 106352 |
|  |  | **199339** |
| **Total Common Stocks <br>(Cost $16,262,177)** | **Total Common Stocks <br>(Cost $16,262,177)** | **17688939** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(b) – 1.4%** | **SECURITIES LENDING REINVESTMENTS(b) – 1.4%** | **SECURITIES LENDING REINVESTMENTS(b) – 1.4%** |
| **REPURCHASE AGREEMENTS – 1.4%** | **REPURCHASE AGREEMENTS – 1.4%** | **REPURCHASE AGREEMENTS – 1.4%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $248,002, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $249,743 <br>(Cost $247,981) | $247981 | 247981 |
| **Total Investments – 99.3% <br>(Cost $16,510,158)** | **Total Investments – 99.3% <br>(Cost $16,510,158)** | **17936920** |
|  Other assets less liabilities – 0.7% | Other assets less liabilities – 0.7% | 125543 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**18062463** |

---

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $1,462,542, collateralized in the form of cash with a value of $247,981 that was reinvested in the securities shown in the* 

*See Accompanying Notes to the Financial Statements.* 

362 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund (cont.)

------

*Securities Lending Reinvestment section of the Schedule of Investments and $1,253,747 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 15, 2022 – May 15, 2052; a total value of $1,501,728.* 

*<sup>(b)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $247,981.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of* 

 *investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $2495265 |
|  Aggregate gross unrealized depreciation | (1079098) |
|  Net unrealized appreciation | $1416167 |
|  Federal income tax cost | $16510604 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |  |
|  S&P 500 Micro E-Mini Index | 19 | 12/16/2022 | USD | $368885 | $(10149) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 97.9% |
|  Securities Lending Reinvestments | 1.4 |
|  Others<sup>(1)</sup> | 0.7 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 363

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> International Quality Dividend Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 97.9%** | **COMMON STOCKS – 97.9%** | **COMMON STOCKS – 97.9%** |
| **Auto Components – 1.0%** | **Auto Components – 1.0%** | **Auto Components – 1.0%** |
|  Bridgestone Corp. | 100400 | $3621925 |
|  Fuyao Glass Industry Group Co. Ltd., Class H(a) | 238000 | 853481 |
|  |  | **4475406** |
| **Automobiles – 2.9%** | **Automobiles – 2.9%** | **Automobiles – 2.9%** |
|  Bajaj Auto Ltd. | 67158 | 2978999 |
|  Ford Otomotiv Sanayi A/S | 188136 | 3671114 |
|  Mercedes-Benz Group AG | 84006 | 4865401 |
|  Toyota Motor Corp. | 70200 | 972698 |
|  |  | **12488212** |
| **Banks – 14.6%** | **Banks – 14.6%** | **Banks – 14.6%** |
|  Agricultural Bank of China Ltd., Class H | 10998000 | 3138343 |
|  Banco Bilbao Vizcaya Argentaria SA | 197964 | 1019181 |
|  Bank of Montreal(b) | 27846 | 2561779 |
|  Barclays plc | 925002 | 1573646 |
|  BNP Paribas SA | 17316 | 812842 |
|  BOC Hong Kong Holdings Ltd. | 936000 | 2909406 |
|  China Merchants Bank Co. Ltd., Class H | 117000 | 384542 |
|  Commonwealth Bank of Australia | 2340 | 156634 |
|  FinecoBank Banca Fineco SpA | 269334 | 3630917 |
|  First Abu Dhabi Bank PJSC | 562068 | 2739145 |
|  HSBC Holdings plc | 950976 | 4897516 |
|  Industrial & Commercial Bank of China Ltd., Class H | 3042000 | 1321455 |
|  Japan Post Bank Co. Ltd.(b) | 163800 | 1091008 |
|  KBC Group NV | 77688 | 3892895 |
|  Mitsubishi UFJ Financial Group, Inc. | 1263600 | 5946703 |
|  Nordea Bank Abp | 98982 | 945172 |
|  Powszechna Kasa Oszczednosci Bank Polski SA | 707616 | 3866316 |
|  Royal Bank of Canada(b) | 148356 | 13709376 |
|  Sberbank of Russia PJSC\* ‡ | 1227390 |  |
|  Skandinaviska Enskilda Banken AB, Class A | 366912 | 3868191 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Swedbank AB, Class A | 281736 | $| 4197823 |
|  Toronto-Dominion Bank (The) | 6552 |  | 418803 |
|  |  |  | **63081693** |
| **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** |
|  Arca Continental SAB de CV | 514800 |  | 4209124 |
|  Nongfu Spring Co. Ltd., Class H(a) (b) | 93600 |  | 470394 |
|  Thai Beverage PCL | 2363400 |  | 960324 |
|  |  |  | **5639842** |
| **Building Products – 1.1%** | **Building Products – 1.1%** | **Building Products – 1.1%** | **Building Products – 1.1%** |
|  Geberit AG (Registered) | 4212 |  | 1874198 |
|  Lixil Corp. | 187200 |  | 2835047 |
|  |  |  | **4709245** |
| **Capital Markets – 5.0%** | **Capital Markets – 5.0%** | **Capital Markets – 5.0%** | **Capital Markets – 5.0%** |
|  3i Group plc | 146016 |  | 1950981 |
|  China Galaxy Securities Co. Ltd., Class H | 4095000 |  | 1533698 |
|  Hargreaves Lansdown plc | 31122 |  | 273472 |
|  IGM Financial, Inc. | 121446 |  | 3247048 |
|  Julius Baer Group Ltd. | 41418 |  | 1985332 |
|  Korea Investment Holdings Co. Ltd. | 46098 |  | 1603535 |
|  Macquarie Korea Infrastructure Fund | 46098 |  | 357600 |
|  Moscow Exchange MICEX-RTS PJSC\* ‡ | 775590 |  |  |
|  NH Investment & Securities Co. Ltd. | 460980 |  | 2902868 |
|  Partners Group Holding AG | 2340 |  | 2103019 |
|  Samsung Securities Co. Ltd. | 135486 |  | 3019889 |
|  SBI Holdings, Inc. | 147000 |  | 2658432 |
|  |  |  | **21635874** |
| **Chemicals – 1.9%** | **Chemicals – 1.9%** | **Chemicals – 1.9%** | **Chemicals – 1.9%** |
|  Kumho Petrochemical Co. Ltd. | 12168 |  | 1119034 |
|  Nissan Chemical Corp. | 8500 |  | 383153 |
|  Nitto Denko Corp. | 17300 |  | 911353 |
|  Wacker Chemie AG | 17784 |  | 2072307 |
|  Yara International ASA | 84006 |  | 3749096 |
|  |  |  | **8234943** |

---

*See Accompanying Notes to the Financial Statements.* 

364 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction Materials – 1.5%** | **Construction Materials – 1.5%** | **Construction Materials – 1.5%** |
|  Ambuja Cements Ltd. | 699894 | $4506158 |
|  Anhui Conch Cement Co. Ltd., Class H | 737000 | 1896520 |
|  |  | **6402678** |
| **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** |
|  Power Finance Corp. Ltd. | 849186 | 1182310 |
|  REC Ltd. | 2711124 | 3358712 |
|  |  | **4541022** |
| **Diversified Telecommunication Services – 2.0%** | **Diversified Telecommunication Services – 2.0%** | **Diversified Telecommunication Services – 2.0%** |
|  Elisa OYJ | 8892 | 429841 |
|  Koninklijke KPN NV | 700362 | 1959626 |
|  Spark New Zealand Ltd. | 43758 | 130157 |
|  Swisscom AG (Registered) | 3744 | 1849272 |
|  Telefonica SA | 37717 | 129913 |
|  Telenor ASA | 318708 | 2896830 |
|  Telstra Group Ltd. | 523692 | 1312709 |
|  |  | **8708348** |
| **Electric Utilities – 1.9%** | **Electric Utilities – 1.9%** | **Electric Utilities – 1.9%** |
|  Endesa SA(b) | 65754 | 1097322 |
|  Enel SpA | 415350 | 1855100 |
|  Fortum OYJ(b) | 230724 | 3248374 |
|  Origin Energy Ltd. | 538200 | 1916926 |
|  |  | **8117722** |
| **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** | **Electronic Equipment, Instruments & Components – 0.5%** |
|  AUO Corp. | 2434400 | 1276790 |
|  Kingboard Laminates Holdings Ltd.(b) | 234000 | 186906 |
|  Largan Precision Co. Ltd. | 4000 | 229653 |
|  Shimadzu Corp. | 10200 | 269351 |
|  |  | **1962700** |
| **Entertainment – 1.2%** | **Entertainment – 1.2%** | **Entertainment – 1.2%** |
|  Capcom Co. Ltd.(b) | 10400 | 290026 |
|  Nintendo Co. Ltd. | 118000 | 4818919 |
|  |  | **5108945** |
| **Equity Real Estate Investment Trusts (REITs) – 0.8%** | **Equity Real Estate Investment Trusts (REITs) – 0.8%** | **Equity Real Estate Investment Trusts (REITs) – 0.8%** |
|  Dexus | 289224 | 1435168 |
|  Stockland | 927810 | 2135837 |
|  |  | **3571005** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** |
|  Cencosud SA | 2583360 | $3476176 |
|  Kesko OYJ, Class B | 56394 | 1098019 |
|  |  | **4574195** |
| **Food Products – 3.6%** | **Food Products – 3.6%** | **Food Products – 3.6%** |
|  China Feihe Ltd.(a) (b) | 3276000 | 1886344 |
|  Nestle SA (Registered) | 86814 | 9459104 |
|  Uni-President China Holdings Ltd. | 4212000 | 3112111 |
|  Want Want China Holdings Ltd. | 1872000 | 1230536 |
|  |  | **15688095** |
| **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** |
|  Kunlun Energy Co. Ltd. | 668000 | 399105 |
|  Naturgy Energy Group SA(b) | 126828 | 3254098 |
|  |  | **3653203** |
| **Health Care Equipment & Supplies – 0.1%** | **Health Care Equipment & Supplies – 0.1%** | **Health Care Equipment & Supplies – 0.1%** |
|  Hoya Corp. | 5800 | 541427 |
| **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** |
|  InterContinental Hotels Group plc | 24102 | 1303132 |
|  OPAP SA | 254124 | 3114427 |
|  |  | **4417559** |
| **Household Durables – 1.3%** | **Household Durables – 1.3%** | **Household Durables – 1.3%** |
|  Barratt Developments plc | 194220 | 841241 |
|  Nien Made Enterprise Co. Ltd. | 316000 | 2441896 |
|  Persimmon plc | 142740 | 2144685 |
|  |  | **5427822** |
| **Household Products – 0.7%** | **Household Products – 0.7%** | **Household Products – 0.7%** |
|  Unilever Indonesia Tbk. PT | 9687600 | 2881902 |
| **Independent Power and Renewable Electricity<br>Producers – 0.0%** | **Independent Power and Renewable Electricity<br>Producers – 0.0%** | **Independent Power and Renewable Electricity<br>Producers – 0.0%** |
|  Unipro PJSC‡ | 125500000 |  |
| **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** |
|  Industries Qatar QSC | 405756 | 1757060 |
| **Insurance – 1.7%** | **Insurance – 1.7%** | **Insurance – 1.7%** |
|  ASR Nederland NV | 66924 | 2949376 |
|  BB Seguridade Participacoes SA | 655200 | 3707254 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 365

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Caixa Seguridade Participacoes S/A | 117000 | $| 196663 |
|  Sampo OYJ, Class A | 11466 |  | 524464 |
|  |  |  | **7377757** |
| **Interactive Media & Services – 0.8%** | **Interactive Media & Services – 0.8%** | **Interactive Media & Services – 0.8%** | **Interactive Media & Services – 0.8%** |
|  Rightmove plc | 263718 |  | 1493261 |
|  Tencent Holdings Ltd. | 80500 |  | 2108422 |
|  |  |  | **3601683** |
| **Internet & Direct Marketing Retail – 1.0%** | **Internet & Direct Marketing Retail – 1.0%** | **Internet & Direct Marketing Retail – 1.0%** | **Internet & Direct Marketing Retail – 1.0%** |
|  momo.com, Inc. | 91920 |  | 1376411 |
|  ZOZO, Inc. | 127500 |  | 2714956 |
|  |  |  | **4091367** |
| **IT Services – 2.3%** | **IT Services – 2.3%** | **IT Services – 2.3%** | **IT Services – 2.3%** |
|  HCL Technologies Ltd. | 167310 |  | 2104374 |
|  Infosys Ltd. | 61776 |  | 1147532 |
|  Itochu Techno-Solutions Corp.(b) | 101200 |  | 2348976 |
|  Nomura Research Institute Ltd. | 70200 |  | 1560945 |
|  Obic Co. Ltd. | 4800 |  | 722414 |
|  Otsuka Corp. | 46800 |  | 1478292 |
|  SCSK Corp. | 41600 |  | 614897 |
|  |  |  | **9977430** |
| **Machinery – 2.6%** | **Machinery – 2.6%** | **Machinery – 2.6%** | **Machinery – 2.6%** |
|  Atlas Copco AB, Class A(b) | 183690 |  | 1962162 |
|  Atlas Copco AB, Class B | 33930 |  | 328355 |
|  Daifuku Co. Ltd. | 6200 |  | 284482 |
|  Epiroc AB, Class A | 119106 |  | 1822086 |
|  Epiroc AB, Class B | 8190 |  | 109949 |
|  FANUC Corp. | 9000 |  | 1188616 |
|  Haitian International Holdings Ltd. | 754000 |  | 1509950 |
|  Kone OYJ, Class B | 61074 |  | 2502025 |
|  Schindler Holding AG | 936 |  | 152688 |
|  VAT Group AG(a) (b) | 2808 |  | 641989 |
|  Yaskawa Electric Corp. | 32300 |  | 897494 |
|  |  |  | **11399796** |
| **Marine – 2.5%** | **Marine – 2.5%** | **Marine – 2.5%** | **Marine – 2.5%** |
|  AP Moller – Maersk A/S, Class A | 1404 |  | 2810778 |
|  AP Moller – Maersk A/S, Class B | 1404 |  | 2937523 |
|  Nippon Yusen KK(b) | 140400 |  | 2549464 |
|  Orient Overseas International Ltd.(b) | 117000 |  | 1709574 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Marine – (continued)** | **Marine – (continued)** | **Marine – (continued)** | **Marine – (continued)** |
|  SITC International Holdings Co. Ltd. | 468000 | $| 766700 |
|  Yang Ming Marine Transport Corp. | 54000 |  | 100886 |
|  |  |  | **10874925** |
| **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** | **Media – 0.3%** |
|  Publicis Groupe SA | 23400 |  | 1312248 |
| **Metals & Mining – 6.1%** | **Metals & Mining – 6.1%** | **Metals & Mining – 6.1%** | **Metals & Mining – 6.1%** |
|  BHP Group Ltd. | 177138 |  | 4231801 |
|  China Hongqiao Group Ltd.(b) | 3276000 |  | 2324544 |
|  Cia Siderurgica Nacional SA | 93600 |  | 219050 |
|  Fortescue Metals Group Ltd.(b) | 310284 |  | 2916643 |
|  Gerdau SA (Preference) | 210600 |  | 1033484 |
|  Grupo Mexico SAB de CV, Series B(b) | 889200 |  | 3217857 |
|  Impala Platinum Holdings Ltd. | 58734 |  | 601162 |
|  Kumba Iron Ore Ltd. | 126594 |  | 2383363 |
|  MMC Norilsk Nickel PJSC‡ | 16315 |  |  |
|  Rio Tinto plc | 118404 |  | 6185040 |
|  Severstal PAO‡ | 58985 |  |  |
|  Vedanta Ltd. | 949572 |  | 3221163 |
|  |  |  | **26334107** |
| **Multiline Retail – 0.0%(c)** | **Multiline Retail – 0.0%(c)** | **Multiline Retail – 0.0%(c)** | **Multiline Retail – 0.0%(c)** |
|  B&M European Value Retail SA(b) | 20124 |  | 74746 |
| **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** | **Oil, Gas & Consumable Fuels – 5.9%** |
|  Adaro Energy Indonesia Tbk. PT | 16777800 |  | 4281176 |
|  Canadian Natural Resources Ltd. | 124254 |  | 7443125 |
|  China Shenhua Energy Co. Ltd., Class H | 1287000 |  | 3385612 |
|  Exxaro Resources Ltd. | 280332 |  | 3119766 |
|  Ovintiv, Inc.(b) | 3744 |  | 189634 |
|  Petroleo Brasileiro SA | 140400 |  | 889934 |
|  Petroleo Brasileiro SA (Preference) | 678600 |  | 3855175 |
|  Shell plc | 64350 |  | 1781108 |
|  TotalEnergies SE | 8424 |  | 458755 |
|  |  |  | **25404285** |
| **Personal Products – 2.0%** | **Personal Products – 2.0%** | **Personal Products – 2.0%** | **Personal Products – 2.0%** |
|  Hengan International Group Co. Ltd. | 117000 |  | 453849 |

---

*See Accompanying Notes to the Financial Statements.* 

366 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Personal Products – (continued)** | **Personal Products – (continued)** | **Personal Products – (continued)** | **Personal Products – (continued)** |
|  L'Oreal SA | 25506 | $| 8018937 |
|  Unilever plc | 5382 |  | 246283 |
|  |  |  | **8719069** |
| **Pharmaceuticals – 9.6%** | **Pharmaceuticals – 9.6%** | **Pharmaceuticals – 9.6%** | **Pharmaceuticals – 9.6%** |
|  Astellas Pharma, Inc. | 23400 |  | 322186 |
|  China Medical System Holdings Ltd. | 702000 |  | 766402 |
|  Chugai Pharmaceutical Co. Ltd. | 110800 |  | 2571803 |
|  GSK plc | 385164 |  | 6336136 |
|  Novartis AG (Registered) | 104598 |  | 8455636 |
|  Novo Nordisk A/S, Class B | 74412 |  | 8091665 |
|  Orion OYJ, Class B | 78390 |  | 3606543 |
|  Roche Holding AG | 33462 |  | 11119449 |
|  Roche Holding AG – BR | 702 |  | 284939 |
|  |  |  | **41554759** |
| **Professional Services – 1.9%** | **Professional Services – 1.9%** | **Professional Services – 1.9%** | **Professional Services – 1.9%** |
|  Bureau Veritas SA | 20124 |  | 498631 |
|  Nihon M&A Center Holdings, Inc. | 104700 |  | 1185522 |
|  Randstad NV(b) | 20358 |  | 1014895 |
|  Recruit Holdings Co. Ltd. | 42000 |  | 1297003 |
|  RELX plc | 64818 |  | 1747046 |
|  SGS SA (Registered) | 1045 |  | 2306675 |
|  |  |  | **8049772** |
| **Real Estate Management & Development – 2.5%** | **Real Estate Management & Development – 2.5%** | **Real Estate Management & Development – 2.5%** | **Real Estate Management & Development – 2.5%** |
|  China Overseas Land & Investment Ltd. | 702000 |  | 1339638 |
|  China Resources Land Ltd. | 44000 |  | 137888 |
|  CK Asset Holdings Ltd. | 117000 |  | 646866 |
|  Daito Trust Construction Co. Ltd. | 37800 |  | 3740963 |
|  Hopson Development Holdings Ltd.(b) | 210689 |  | 169091 |
|  Land & Houses PCL, NVDR | 5639400 |  | 1363176 |
|  Sino Land Co. Ltd.(b) | 74000 |  | 79092 |
|  Sun Hung Kai Properties Ltd. | 324000 |  | 3485646 |
|  |  |  | **10962360** |
| **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** |
|  Aurizon Holdings Ltd. | 1335438 |  | 3091284 |
|  Canadian National Railway Co. | 2106 |  | 249190 |
|  |  |  | **3340474** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Semiconductors & Semiconductor Equipment – 4.4%** | **Semiconductors & Semiconductor Equipment – 4.4%** | **Semiconductors & Semiconductor Equipment – 4.4%** |
|  Advantest Corp.(b) | 23400 | $1237421 |
|  ASML Holding NV | 11700 | 5527446 |
|  Nanya Technology Corp. | 1404000 | 2374676 |
|  Novatek Microelectronics Corp. | 411000 | 3073970 |
|  Parade Technologies Ltd. | 32000 | 604795 |
|  Realtek Semiconductor Corp. | 80000 | 633098 |
|  Silergy Corp. | 24000 | 278563 |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 394222 | 4771404 |
|  Vanguard International Semiconductor Corp. | 295000 | 607898 |
|  |  | **19109271** |
| **Software – 0.4%** | **Software – 0.4%** | **Software – 0.4%** |
|  SAP SE | 9828 | 948718 |
|  Temenos AG (Registered) | 15912 | 949234 |
|  |  | **1897952** |
| **Specialty Retail – 1.8%** | **Specialty Retail – 1.8%** | **Specialty Retail – 1.8%** |
|  H & M Hennes & Mauritz AB, Class B(b) | 95238 | 958374 |
|  Industria de Diseno Textil SA(b) | 150930 | 3421998 |
|  Topsports International Holdings Ltd.(a) | 936000 | 472183 |
|  USS Co. Ltd. | 187200 | 2830009 |
|  |  | **7682564** |
| **Technology Hardware, Storage & Peripherals – 0.8%** | **Technology Hardware, Storage & Peripherals – 0.8%** | **Technology Hardware, Storage & Peripherals – 0.8%** |
|  Catcher Technology Co. Ltd. | 214000 | 1125704 |
|  Samsung Electronics Co. Ltd. | 52182 | 2176005 |
|  |  | **3301709** |
| **Textiles, Apparel & Luxury Goods – 2.1%** | **Textiles, Apparel & Luxury Goods – 2.1%** | **Textiles, Apparel & Luxury Goods – 2.1%** |
|  ANTA Sports Products Ltd. | 140400 | 1234113 |
|  Bosideng International Holdings Ltd.(b) | 2552000 | 1102095 |
|  Hermes International | 702 | 909253 |
|  Kering SA | 7956 | 3646218 |
|  Li Ning Co. Ltd. | 59000 | 305152 |
|  LVMH Moet Hennessy Louis Vuitton SE | 2574 | 1625624 |
|  Pandora A/S | 3510 | 185040 |
|  |  | **9007495** |
| **Tobacco – 2.1%** | **Tobacco – 2.1%** | **Tobacco – 2.1%** |
|  Imperial Brands plc | 178308 | 4360464 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 367

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Tobacco – (continued)** | **Tobacco – (continued)** | **Tobacco – (continued)** |
|  Japan Tobacco, Inc. | 234000 | $3879140 |
|  Swedish Match AB | 63180 | 649498 |
|  |  | **8889102** |
| **Trading Companies & Distributors – 0.0%(c)** | **Trading Companies & Distributors – 0.0%(c)** | **Trading Companies & Distributors – 0.0%(c)** |
|  Ferguson plc | 936 | 102486 |
| **Transportation Infrastructure – 0.1%** | **Transportation Infrastructure – 0.1%** | **Transportation Infrastructure – 0.1%** |
|  Grupo Aeroportuario del Pacifico SAB de CV, Class B | 23400 | 361805 |
| **Wireless Telecommunication Services – 0.4%** | **Wireless Telecommunication Services – 0.4%** | **Wireless Telecommunication Services – 0.4%** |
|  Intouch Holdings PCL, NVDR | 234000 | 442669 |
|  Tele2 AB, Class B | 160290 | 1313019 |
|  |  | **1755688** |
| **Total Common Stocks <br>(Cost $501,071,246)** | **Total Common Stocks <br>(Cost $501,071,246)** | **422801748** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(d) – 1.8%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.8%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.8%** |
| **REPURCHASE AGREEMENTS – 1.8%** | **REPURCHASE AGREEMENTS – 1.8%** | **REPURCHASE AGREEMENTS – 1.8%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $7,869,104, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $7,924,336 <br>(Cost $7,868,448) | $7868448 | 7868448 |
| **Total Investments – 99.7% <br>(Cost $508,939,694)** | **Total Investments – 99.7% <br>(Cost $508,939,694)** | **430670196** |
|  Other assets less liabilities – 0.3% | Other assets less liabilities – 0.3% | 1426896 |
| **NET ASSETS – 100.0%** |  | $**432097092** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(b)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $30,462,551, collateralized in the form of cash with a value of $7,868,448 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $19,921,144 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $4,810,312 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 22, 2023 – June 30, 2120; a total value of $32,599,904.* 

*<sup>(c)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(d)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $7,868,448.* 

*‡* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*NVDR – Non-Voting Depositary Receipt* 

*OYJ – Public Limited Company* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $28200916 |
|  Aggregate gross unrealized depreciation | (107504195) |
|  Net unrealized depreciation | $(79303279) |
|  Federal income tax cost | $509632820 |

---

*See Accompanying Notes to the Financial Statements.* 

368 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

------

**Futures Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Appreciation/<br>(Depreciation)\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  EURO STOXX 50 Index | 47 | 12/16/2022 | EUR | $1680650 | $33588 |
|  FTSE 100 Index | 23 | 12/16/2022 | GBP | 1882141 | (54895) |
|  Hang Seng Index | 1 | 11/29/2022 | HKD | 93231 | (3781) |
|  MSCI Emerging Markets E-Mini Index | 62 | 12/16/2022 | USD | 2646160 | (317447) |
|  S&P/TSX 60 Index | 5 | 12/15/2022 | CAD | 863311 | 4202 |
|  SPI 200 Index | 6 | 12/15/2022 | AUD | 657610 | (3944) |
|  TOPIX Index | 10 | 12/08/2022 | JPY | 1295792 | 17738 |
|  |  |  |  |  | $(324539) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 263885 | Bank of New York | CHF | 257090 | 12/21/2022 | $5399 |
|  USD | 592452 | Citibank NA | JPY | 84963779 | 12/21/2022 | 17089 |
|  USD | 423041 | JPMorgan Chase Bank | TWD<sup>\*</sup> | 13436624 | 12/21/2022 | 4251 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $26739 |
|  JPY | 146913786 | Citibank NA | USD | 1037735 | 12/21/2022 | $(42855) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(42855) |
|  Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | Net unrealized depreciation | $(16116) |

---

*\** *Non-deliverable forward. See Note 2 in the Notes to Financial Statements.* 

*Abbreviations:* 

*AUD — Australian Dollar* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*EUR – Euro* 

*GBP – British Pound* 

*HKD – Hong Kong Dollar* 

*JPY – Japanese Yen* 

*TWD – Taiwan Dollar* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 369

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FlexShares<sup>®</sup> International Quality Dividend Index Fund (cont.)

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*FlexShares<sup>®</sup> International Quality Dividend Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | | |
|:---|:---|:---|
|  Australia | 4.0 | % |
|  Belgium | 0.9 |  |
|  Brazil | 2.3 |  |
|  Canada | 6.4 |  |
|  Chile | 0.8 |  |
|  China | 7.7 |  |
|  Denmark | 3.3 |  |
|  Finland | 2.7 |  |
|  France | 4.0 |  |
|  Germany | 1.8 |  |
|  Greece | 0.7 |  |
|  Hong Kong | 1.8 |  |
|  India | 4.3 |  |
|  Indonesia | 1.7 |  |
|  Italy | 1.3 |  |
|  Japan | 12.9 |  |
|  Mexico | 1.8 |  |
|  Netherlands | 2.7 |  |
|  New Zealand | 0.0 | <sup>†</sup> |
|  Norway | 1.5 |  |
|  Poland | 0.9 |  |
|  Qatar | 0.4 |  |
|  Singapore | 0.2 |  |
|  South Africa | 1.4 |  |
|  South Korea | 2.6 |  |
|  Spain | 2.1 |  |
|  Sweden | 3.7 |  |
|  Switzerland | 9.5 |  |
|  Taiwan | 4.4 |  |
|  Thailand | 0.4 |  |
|  Turkey | 0.9 |  |
|  United Arab Emirates | 0.6 |  |
|  United Kingdom | 8.2 |  |
|  Other<sup>1</sup> | 2.1 |  |
|  | 100.0 | % |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 97.9% |
|  Securities Lending Reinvestments | 1.8 |
|  Others<sup>(1)</sup> | 0.3 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

370 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.1%** | **COMMON STOCKS – 98.1%** | **COMMON STOCKS – 98.1%** |
| **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** | **Aerospace & Defense – 0.1%** |
|  Thales SA | 322 | $40943 |
| **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** | **Air Freight & Logistics – 0.2%** |
|  Deutsche Post AG (Registered) | 759 | 26938 |
|  SG Holdings Co. Ltd. | 4600 | 61030 |
|  |  | **87968** |
| **Auto Components – 0.8%** | **Auto Components – 0.8%** | **Auto Components – 0.8%** |
|  Bridgestone Corp. | 9300 | 335497 |
| **Automobiles – 2.7%** | **Automobiles – 2.7%** | **Automobiles – 2.7%** |
|  Bajaj Auto Ltd. | 6785 | 300969 |
|  Ford Otomotiv Sanayi A/S | 17503 | 341538 |
|  Hero MotoCorp Ltd. | 9683 | 313128 |
|  Mercedes-Benz Group AG | 897 | 51952 |
|  Toyota Motor Corp. | 6900 | 95607 |
|  |  | **1103194** |
| **Banks – 10.6%** | **Banks – 10.6%** | **Banks – 10.6%** |
|  ABN AMRO Bank NV, CVA(a) | 9846 | 96885 |
|  Banco de Chile | 1178520 | 107748 |
|  Banco Santander Chile | 1985774 | 71115 |
|  Bank Hapoalim BM | 33373 | 323347 |
|  Bank Leumi Le-Israel BM | 7337 | 70358 |
|  Bank of China Ltd., Class H | 414000 | 133432 |
|  Bank of Communications Co. Ltd., Class H | 138000 | 67331 |
|  Bankinter SA(b) | 63986 | 386779 |
|  BOC Hong Kong Holdings Ltd. | 103500 | 321713 |
|  China CITIC Bank Corp. Ltd., Class H(b) | 46000 | 17346 |
|  China Everbright Bank Co. Ltd., Class H | 253000 | 65427 |
|  Commonwealth Bank of Australia | 8878 | 594272 |
|  Credit Agricole SA | 11592 | 105244 |
|  Hang Seng Bank Ltd. | 6900 | 97129 |
|  HSBC Holdings plc | 6187 | 31863 |
|  Japan Post Bank Co. Ltd.(b) | 46000 | 306388 |
|  Malayan Banking Bhd. | 35291 | 64118 |
|  National Bank of Canada | 1886 | 128254 |
|  Nordea Bank Abp | 15640 | 149345 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Royal Bank of Canada(b) | 8648 | $| 799150 |
|  Sberbank of Russia PJSC\* ‡ | 79800 |  |  |
|  Swedbank AB, Class A | 21965 |  | 327275 |
|  Toronto-Dominion Bank (The) | 603 |  | 38544 |
|  |  |  | **4303063** |
| **Building Products – 0.2%** | **Building Products – 0.2%** | **Building Products – 0.2%** | **Building Products – 0.2%** |
|  Xinyi Glass Holdings Ltd. | 69000 |  | 88779 |
| **Capital Markets – 4.2%** | **Capital Markets – 4.2%** | **Capital Markets – 4.2%** | **Capital Markets – 4.2%** |
|  Amundi SA(a) | 1817 |  | 85805 |
|  Everbright Securities Co. Ltd., Class H(a) (b) | 138000 |  | 74715 |
|  IGM Financial, Inc. | 11293 |  | 301936 |
|  Korea Investment Holdings Co. Ltd. | 6854 |  | 238419 |
|  Macquarie Korea Infrastructure Fund | 33212 |  | 257638 |
|  Moscow Exchange MICEX-RTS PJSC\* ‡ | 227100 |  |  |
|  NH Investment & Securities Co. Ltd. | 44413 |  | 279676 |
|  Samsung Securities Co. Ltd. | 12305 |  | 274270 |
|  Singapore Exchange Ltd. | 32200 |  | 191593 |
|  |  |  | **1704052** |
| **Chemicals – 1.6%** | **Chemicals – 1.6%** | **Chemicals – 1.6%** | **Chemicals – 1.6%** |
|  Evonik Industries AG | 3703 |  | 68274 |
|  Nissan Chemical Corp. | 5200 |  | 234400 |
|  Yara International ASA | 7728 |  | 344892 |
|  |  |  | **647566** |
| **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** | **Commercial Services & Supplies – 0.2%** |
|  Brambles Ltd. | 12788 |  | 95511 |
| **Construction & Engineering – 0.8%** | **Construction & Engineering – 0.8%** | **Construction & Engineering – 0.8%** | **Construction & Engineering – 0.8%** |
|  Bouygues SA | 3588 |  | 102414 |
|  Taisei Corp. | 3700 |  | 100942 |
|  WSP Global, Inc. | 874 |  | 107285 |
|  |  |  | **310641** |
| **Construction Materials – 1.1%** | **Construction Materials – 1.1%** | **Construction Materials – 1.1%** | **Construction Materials – 1.1%** |
|  ACC Ltd. | 11293 |  | 326099 |
|  Ambuja Cements Ltd. | 2691 |  | 17325 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 371

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** | **Construction Materials – (continued)** |
|  China Resources Cement Holdings Ltd.(b) | 128000 | $| 46309 |
|  LafargeHolcim Maroc SA | 460 |  | 62138 |
|  |  |  | **451871** |
| **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** | **Containers & Packaging – 0.2%** |
|  Klabin SA | 20700 |  | 85289 |
| **Diversified Financial Services – 0.3%** | **Diversified Financial Services – 0.3%** | **Diversified Financial Services – 0.3%** | **Diversified Financial Services – 0.3%** |
|  Power Finance Corp. Ltd. | 78016 |  | 108621 |
| **Diversified Telecommunication Services – 3.2%** | **Diversified Telecommunication Services – 3.2%** | **Diversified Telecommunication Services – 3.2%** | **Diversified Telecommunication Services – 3.2%** |
|  Elisa OYJ | 6118 |  | 295745 |
|  Emirates Telecommunications Group Co. PJSC | 9177 |  | 64460 |
|  Hellenic Telecommunications Organization SA | 6095 |  | 95782 |
|  Koninklijke KPN NV | 24081 |  | 67379 |
|  Nippon Telegraph & Telephone Corp. | 6600 |  | 181790 |
|  Proximus SADP | 5796 |  | 60779 |
|  Spark New Zealand Ltd. | 3450 |  | 10262 |
|  Telefonica Deutschland Holding AG | 37030 |  | 80737 |
|  Telefonica SA | 29988 |  | 103291 |
|  Telenor ASA | 29716 |  | 270097 |
|  Telia Co. AB(b) | 25277 |  | 66907 |
|  |  |  | **1297229** |
| **Electric Utilities – 2.9%** | **Electric Utilities – 2.9%** | **Electric Utilities – 2.9%** | **Electric Utilities – 2.9%** |
|  EDP–Energias de Portugal SA | 25254 |  | 110447 |
|  Endesa SA(b) | 5336 |  | 89049 |
|  Enel SpA | 38571 |  | 172272 |
|  Energisa SA | 9200 |  | 85017 |
|  Fortum OYJ(b) | 8418 |  | 118517 |
|  Iberdrola SA | 7320 |  | 74337 |
|  Power Grid Corp. of India Ltd. | 86848 |  | 239369 |
|  Red Electrica Corp. SA | 6486 |  | 104811 |
|  SSE plc | 6003 |  | 107544 |
|  Transmissora Alianca de Energia Eletrica SA | 11500 |  | 88081 |
|  |  |  | **1189444** |
| **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** | **Electrical Equipment – 0.1%** |
|  Mitsubishi Electric Corp. | 3200 |  | 28203 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Electronic Equipment, Instruments & Components – 1.0%** | **Electronic Equipment, Instruments & Components – 1.0%** | **Electronic Equipment, Instruments & Components – 1.0%** |
|  AUO Corp. | 480800 | $252169 |
|  Innolux Corp. | 187770 | 69054 |
|  Kingboard Laminates Holdings Ltd.(b) | 82500 | 65896 |
|  |  | **387119** |
| **Entertainment – 0.9%** | **Entertainment – 0.9%** | **Entertainment – 0.9%** |
|  Capcom Co. Ltd.(b) | 12300 | 343011 |
| **Equity Real Estate Investment Trusts (REITs) – 0.3%** | **Equity Real Estate Investment Trusts (REITs) – 0.3%** | **Equity Real Estate Investment Trusts (REITs) – 0.3%** |
|  Gecina SA | 368 | 32825 |
|  Growthpoint Properties Ltd.(b) | 122981 | 86661 |
|  |  | **119486** |
| **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** | **Food & Staples Retailing – 1.1%** |
|  BIM Birlesik Magazalar A/S | 58535 | 421638 |
|  Loblaw Cos. Ltd. | 414 | 33877 |
|  |  | **455515** |
| **Food Products – 3.8%** | **Food Products – 3.8%** | **Food Products – 3.8%** |
|  JBS SA | 16100 | 76584 |
|  Nestle SA (Registered) | 13294 | 1448492 |
|  Sime Darby Plantation Bhd. | 27600 | 25685 |
|  |  | **1550761** |
| **Gas Utilities – 2.0%** | **Gas Utilities – 2.0%** | **Gas Utilities – 2.0%** |
|  Grupo Energia Bogota SA ESP | 233703 | 78823 |
|  Naturgy Energy Group SA(b) | 11891 | 305094 |
|  Petronas Gas Bhd. | 87400 | 316104 |
|  Snam SpA | 24380 | 108480 |
|  |  | **808501** |
| **Health Care Equipment & Supplies – 0.2%** | **Health Care Equipment & Supplies – 0.2%** | **Health Care Equipment & Supplies – 0.2%** |
|  Fisher & Paykel Healthcare Corp. Ltd. | 7613 | 86598 |
| **Health Care Providers & Services – 0.9%** | **Health Care Providers & Services – 0.9%** | **Health Care Providers & Services – 0.9%** |
|  Mitra Keluarga Karyasehat Tbk. PT(a) | 1938900 | 343091 |
| **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** |
|  McDonald's Holdings Co. Japan Ltd. | 2500 | 86790 |
|  OPAP SA | 23644 | 289770 |
|  |  | **376560** |

---

*See Accompanying Notes to the Financial Statements.* 

372 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Household Durables – 0.8%** | **Household Durables – 0.8%** | **Household Durables – 0.8%** |
|  Persimmon plc | 14306 | $214949 |
|  Sekisui House Ltd. | 6900 | 114896 |
|  |  | **329845** |
| **Independent Power and Renewable Electricity<br>Producers – 0.2%** | **Independent Power and Renewable Electricity<br>Producers – 0.2%** | **Independent Power and Renewable Electricity<br>Producers – 0.2%** |
|  China Resources Power Holdings Co. Ltd.(b) | 46000 | 66921 |
|  Huadian Power International Corp. Ltd., Class H | 92000 | 27659 |
|  |  | **94580** |
| **Industrial Conglomerates – 1.6%** | **Industrial Conglomerates – 1.6%** | **Industrial Conglomerates – 1.6%** |
|  Alfa SAB de CV, Class A | 69000 | 45713 |
|  Jardine Matheson Holdings Ltd. | 1800 | 82836 |
|  Quinenco SA | 44367 | 117943 |
|  Siemens AG (Registered) | 115 | 12575 |
|  Sime Darby Bhd. | 634800 | 302094 |
|  Toshiba Corp. | 2300 | 80172 |
|  |  | **641333** |
| **Insurance – 3.6%** | **Insurance – 3.6%** | **Insurance – 3.6%** |
|  AIA Group Ltd. | 4600 | 34838 |
|  Allianz SE (Registered) | 1495 | 269216 |
|  BB Seguridade Participacoes SA | 62100 | 351374 |
|  Great-West Lifeco, Inc. | 4071 | 94131 |
|  Medibank Pvt Ltd. | 44183 | 79390 |
|  Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Registered) | 713 | 188435 |
|  Sampo OYJ, Class A | 3197 | 146234 |
|  Zurich Insurance Group AG | 736 | 314257 |
|  |  | **1477875** |
| **Interactive Media & Services – 0.5%** | **Interactive Media & Services – 0.5%** | **Interactive Media & Services – 0.5%** |
|  Tencent Holdings Ltd. | 7400 | 193818 |
| **Internet & Direct Marketing Retail – 0.6%** | **Internet & Direct Marketing Retail – 0.6%** | **Internet & Direct Marketing Retail – 0.6%** |
|  ZOZO, Inc. | 11300 | 240620 |
| **IT Services – 2.4%** | **IT Services – 2.4%** | **IT Services – 2.4%** |
|  HCL Technologies Ltd. | 29394 | 369709 |
|  Itochu Techno-Solutions Corp.(b) | 10600 | 246039 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  Tata Consultancy Services Ltd. | 9683 | $| 373522 |
|  |  |  | **989270** |
| **Leisure Products – 0.6%** | **Leisure Products – 0.6%** | **Leisure Products – 0.6%** | **Leisure Products – 0.6%** |
|  Shimano, Inc. | 1600 |  | 248394 |
| **Life Sciences Tools & Services – 0.1%** | **Life Sciences Tools & Services – 0.1%** | **Life Sciences Tools & Services – 0.1%** | **Life Sciences Tools & Services – 0.1%** |
|  Sartorius Stedim Biotech | 69 |  | 21904 |
| **Machinery – 0.8%** | **Machinery – 0.8%** | **Machinery – 0.8%** | **Machinery – 0.8%** |
|  Atlas Copco AB, Class B | 4255 |  | 41178 |
|  Knorr-Bremse AG | 1127 |  | 50748 |
|  Kone OYJ, Class B | 5796 |  | 237445 |
|  |  |  | **329371** |
| **Marine – 1.8%** | **Marine – 1.8%** | **Marine – 1.8%** | **Marine – 1.8%** |
|  AP Moller–Maersk A/S, Class A | 84 |  | 168166 |
|  AP Moller–Maersk A/S, Class B | 133 |  | 278270 |
|  Mitsui OSK Lines Ltd.(b) | 1000 |  | 19854 |
|  SITC International Holdings Co. Ltd. | 104000 |  | 170378 |
|  Yang Ming Marine Transport Corp. | 54000 |  | 100886 |
|  |  |  | **737554** |
| **Media – 0.5%** | **Media – 0.5%** | **Media – 0.5%** | **Media – 0.5%** |
|  Publicis Groupe SA | 2139 |  | 119953 |
|  Quebecor, Inc., Class B | 3795 |  | 71446 |
|  |  |  | **191399** |
| **Metals & Mining – 6.0%** | **Metals & Mining – 6.0%** | **Metals & Mining – 6.0%** | **Metals & Mining – 6.0%** |
|  BHP Group Ltd. | 41653 |  | 995084 |
|  China Hongqiao Group Ltd. | 161000 |  | 114240 |
|  Fortescue Metals Group Ltd.(b) | 28911 |  | 271761 |
|  Gerdau SA (Preference) | 23000 |  | 112869 |
|  Kinross Gold Corp. | 28129 |  | 101871 |
|  Kumba Iron Ore Ltd. | 12328 |  | 232097 |
|  Magnitogorsk Iron & Steel Works PJSC‡ | 172884 |  |  |
|  Novolipetsk Steel PJSC‡ | 47108 |  |  |
|  Rio Tinto Ltd. | 184 |  | 10378 |
|  Rio Tinto plc | 11224 |  | 586305 |
|  Severstal PAO‡ | 6900 |  |  |
|  |  |  | **2424605** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 373

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Multiline Retail – 1.1%** | **Multiline Retail – 1.1%** | **Multiline Retail – 1.1%** |
|  B&M European Value Retail SA(b) | 18101 | $67232 |
|  Canadian Tire Corp. Ltd., Class A(b) | 690 | 77237 |
|  Dollarama, Inc. | 2116 | 125575 |
|  Wesfarmers Ltd. | 5635 | 163806 |
|  |  | **433850** |
| **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** |
|  Engie SA | 3772 | 49039 |
| **Oil, Gas & Consumable Fuels – 7.9%** | **Oil, Gas & Consumable Fuels – 7.9%** | **Oil, Gas & Consumable Fuels – 7.9%** |
|  Adaro Energy Indonesia Tbk. PT | 1573200 | 401432 |
|  Aker BP ASA(b) | 1794 | 57184 |
|  BP plc | 92851 | 512925 |
|  China Petroleum & Chemical Corp., Class H | 230000 | 90830 |
|  Exxaro Resources Ltd. | 26105 | 290518 |
|  LUKOIL PJSC‡ | 240 |  |
|  Neste OYJ | 2760 | 120953 |
|  Ovintiv, Inc.(b) | 1817 | 92031 |
|  Pembina Pipeline Corp.(b) | 3657 | 120591 |
|  Petroleo Brasileiro SA | 55200 | 349888 |
|  Petroleo Brasileiro SA (Preference) | 64400 | 365861 |
|  Shell plc | 16905 | 467904 |
|  Surgutneftegas PJSC (Preference)‡ | 276000 |  |
|  TotalEnergies SE | 6348 | 345700 |
|  |  | **3215817** |
| **Personal Products – 2.2%** | **Personal Products – 2.2%** | **Personal Products – 2.2%** |
|  Hengan International Group Co. Ltd. | 69000 | 267655 |
|  L'Oreal SA | 1817 | 571254 |
|  Unilever plc | 1150 | 52624 |
|  |  | **891533** |
| **Pharmaceuticals – 7.9%** | **Pharmaceuticals – 7.9%** | **Pharmaceuticals – 7.9%** |
|  GSK plc | 27117 | 446088 |
|  Novartis AG (Registered) | 6003 | 485279 |
|  Novo Nordisk A/S, Class B | 1311 | 142560 |
|  Orion OYJ, Class B | 7337 | 337558 |
|  Roche Holding AG | 5290 | 1757871 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Sanofi | 483 | $| 41689 |
|  |  |  | **3211045** |
| **Professional Services – 0.8%** | **Professional Services – 0.8%** | **Professional Services – 0.8%** | **Professional Services – 0.8%** |
|  Nihon M&A Center Holdings, Inc. | 11000 |  | 124553 |
|  RELX plc | 391 |  | 10539 |
|  Thomson Reuters Corp.(b) | 1794 |  | 190559 |
|  |  |  | **325651** |
| **Real Estate Management & Development – 1.7%** | **Real Estate Management & Development – 1.7%** | **Real Estate Management & Development – 1.7%** | **Real Estate Management & Development – 1.7%** |
|  CIFI Holdings Group Co. Ltd.(b) | 322000 |  | 21330 |
|  Country Garden Holdings Co. Ltd.(b) | 299000 |  | 38471 |
|  Daito Trust Construction Co. Ltd. | 3600 |  | 356282 |
|  Greentown Service Group Co. Ltd.(a) (b) | 108000 |  | 44301 |
|  Hopson Development Holdings Ltd.(b) | 71300 |  | 57223 |
|  Land & Houses PCL, NVDR | 483000 |  | 116753 |
|  Longfor Group Holdings Ltd.(c) | 33000 |  | 42039 |
|  |  |  | **676399** |
| **Road & Rail – 1.3%** | **Road & Rail – 1.3%** | **Road & Rail – 1.3%** | **Road & Rail – 1.3%** |
|  Aurizon Holdings Ltd. | 124936 |  | 289203 |
|  Canadian National Railway Co. | 1909 |  | 225881 |
|  |  |  | **515084** |
| **Semiconductors & Semiconductor Equipment – 2.5%** | **Semiconductors & Semiconductor Equipment – 2.5%** | **Semiconductors & Semiconductor Equipment – 2.5%** | **Semiconductors & Semiconductor Equipment – 2.5%** |
|  Advantest Corp.(b) | 500 |  | 26440 |
|  ASML Holding NV | 391 |  | 184721 |
|  Novatek Microelectronics Corp. | 28000 |  | 209419 |
|  Powerchip Semiconductor Manufacturing Corp. | 46000 |  | 43969 |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 46000 |  | 556754 |
|  |  |  | **1021303** |
| **Software – 0.1%** | **Software – 0.1%** | **Software – 0.1%** | **Software – 0.1%** |
|  SAP SE | 253 |  | 24423 |
| **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** | **Specialty Retail – 1.6%** |
|  Hikari Tsushin, Inc.(b) | 700 |  | 84630 |
|  Home Product Center PCL, NVDR | 276000 |  | 105875 |
|  Industria de Diseno Textil SA(b) | 14306 |  | 324356 |
|  Topsports International Holdings Ltd.(a) | 23000 |  | 11603 |

---

*See Accompanying Notes to the Financial Statements.* 

374 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  USS Co. Ltd. | 9200 | $| 139082 |
|  |  |  | **665546** |
| **Technology Hardware, Storage & Peripherals – 2.7%** | **Technology Hardware, Storage & Peripherals – 2.7%** | **Technology Hardware, Storage & Peripherals – 2.7%** | **Technology Hardware, Storage & Peripherals – 2.7%** |
|  Asustek Computer, Inc. | 11000 |  | 80565 |
|  Catcher Technology Co. Ltd. | 23000 |  | 120987 |
|  FUJIFILM Holdings Corp. | 2600 |  | 119281 |
|  Inventec Corp. | 110000 |  | 83296 |
|  Lite-On Technology Corp. | 152000 |  | 301901 |
|  Ricoh Co. Ltd. | 12500 |  | 91667 |
|  Samsung Electronics Co. Ltd. | 6992 |  | 291569 |
|  |  |  | **1089266** |
| **Textiles, Apparel & Luxury Goods – 0.5%** | **Textiles, Apparel & Luxury Goods – 0.5%** | **Textiles, Apparel & Luxury Goods – 0.5%** | **Textiles, Apparel & Luxury Goods – 0.5%** |
|  Kering SA | 138 |  | 63245 |
|  LVMH Moet Hennessy Louis Vuitton SE | 230 |  | 145258 |
|  |  |  | **208503** |
| **Tobacco – 4.0%** | **Tobacco – 4.0%** | **Tobacco – 4.0%** | **Tobacco – 4.0%** |
|  British American Tobacco plc | 10672 |  | 421881 |
|  Imperial Brands plc | 16031 |  | 392033 |
|  ITC Ltd. | 74727 |  | 314787 |
|  Japan Tobacco, Inc. | 22000 |  | 364706 |
|  Swedish Match AB | 12581 |  | 129334 |
|  |  |  | **1622741** |
| **Trading Companies & Distributors – 1.2%** | **Trading Companies & Distributors – 1.2%** | **Trading Companies & Distributors – 1.2%** | **Trading Companies & Distributors – 1.2%** |
|  ITOCHU Corp.(b) | 7600 |  | 196807 |
|  Mitsubishi Corp. | 6900 |  | 187129 |
|  Sumitomo Corp. | 8400 |  | 107123 |
|  |  |  | **491059** |
| **Transportation Infrastructure – 0.7%** | **Transportation Infrastructure – 0.7%** | **Transportation Infrastructure – 0.7%** | **Transportation Infrastructure – 0.7%** |
|  Westports Holdings Bhd. | 425500 |  | 302386 |
| **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** |
|  KDDI Corp. | 9200 |  | 272035 |
|  SoftBank Corp. | 11600 |  | 114373 |
|  Tele2 AB, Class B | 28612 |  | 234376 |
|  Vodafone Group plc | 145199 |  | 169917 |
|  |  |  | **790701** |
| **Total Common Stocks<br>(Cost $44,872,925)** | **Total Common Stocks<br>(Cost $44,872,925)** |  | **39803427** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SECURITIES LENDING REINVESTMENTS(d) – 0.9%** | **SECURITIES LENDING REINVESTMENTS(d) – 0.9%** | **SECURITIES LENDING REINVESTMENTS(d) – 0.9%** |
| **REPURCHASE AGREEMENTS – 0.9%** | **REPURCHASE AGREEMENTS – 0.9%** | **REPURCHASE AGREEMENTS – 0.9%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $349,171, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $351,621<br>(Cost $349,142) | $349142 | $349142 |
| **Total Investments – 99.0%<br>(Cost $45,222,067)** | **Total Investments – 99.0%<br>(Cost $45,222,067)** | **40152569** |
|  Other assets less liabilities – 1.0% | Other assets less liabilities – 1.0% | 392772 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**40545341** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(b)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $4,025,435, collateralized in the form of cash with a value of $349,142 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $3,313,552 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $717,486 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from March 22, 2023 – June 30, 2120; a total value of $4,380,180.* 

*<sup>(c)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(d)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $349,142.* 

*<sup>‡</sup>* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 375

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

------

*Abbreviations* 

*CVA – Dutch Certification* 

*NVDR – Non-Voting Depositary Receipt* 

*OYJ – Public Limited Company* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $2762867 |
|  Aggregate gross unrealized depreciation | (8040597) |
|  Net unrealized depreciation | $(5277730) |
|  Federal income tax cost | $45415127 |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading <br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  MSCI EAFE E-Mini Index | 6 | 12/16/2022 | USD | $526770 | $(15308) |
|  MSCI Emerging Markets E-Mini Index | 5 | 12/16/2022 | USD | 213400 | (18134) |
|  |  |  |  |  | $(33442) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity<br>Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 70546 | Morgan Stanley | AUD | 105364 | 12/21/2022 | $3060 |
|  USD | 76143 | Citibank NA | CHF | 73000 | 12/21/2022 | 2746 |
|  USD | 231254 | Morgan Stanley | EUR | 230000 | 12/21/2022 | 2973 |
|  USD | 274235 | Bank of New York | JPY | 38900000 | 12/21/2022 | 10810 |
|  USD | 41931 | JPMorgan Chase Bank | ZAR | 750000 | 12/21/2022 | 1278 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | $20867 |
|  CAD | 76000 | Toronto-Dominion Bank (The) | USD | 57095 | 12/21/2022 | $(1345) |
|  NOK | 59477 | Morgan Stanley | USD | 5788 | 12/21/2022 | (57) |
|  USD | 18524 | Citibank NA | BRL<sup>\*</sup> | 100000 | 12/21/2022 | (332) |
|  USD | 77567 | Bank of New York | GBP | 68000 | 12/21/2022 | (863) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | $(2597) |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | $18270 |

---

*\** *Non-deliverable forward. See Note 2 in the Notes to Financial Statements.* 

*Abbreviations:* 

*AUD — Australian Dollar* 

*BRL — Brazilian Real* 

*CAD — Canadian Dollar* 

*CHF — Swiss Franc* 

*EUR — Euro* 

*See Accompanying Notes to the Financial Statements.* 

376 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (cont.)

------

*GBP — British Pound* 

*JPY — Japanese Yen* 

*NOK — Norwegian Krone* 

*USD — US Dollar* 

*ZAR — South African Rand* 

*FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Australia | 6.2% |
|  Belgium | 0.1 |
|  Brazil | 3.7 |
|  Canada | 6.2 |
|  Chile | 0.7 |
|  China | 3.6 |
|  Colombia | 0.2 |
|  Denmark | 1.4 |
|  Finland | 3.1 |
|  France | 4.3 |
|  Germany | 1.9 |
|  Greece | 0.9 |
|  Hong Kong | 1.8 |
|  India | 5.8 |
|  Indonesia | 1.8 |
|  Israel | 1 |
|  Italy | 0.7 |
|  Japan | 12.1 |
|  Malaysia | 2.5 |
|  Mexico | 0.1 |
|  Morocco | 0.1 |
|  Netherlands | 0.9 |
|  New Zealand | 0.2 |
|  Norway | 1.7 |
|  Portugal | 0.3 |
|  Singapore | 0.7 |
|  South Africa | 1.5 |
|  South Korea | 3.3 |
|  Spain | 3.4 |
|  Sweden | 2.3 |
|  Switzerland | 9.9 |
|  Taiwan | 4.5 |
|  Thailand | 0.5 |
|  Turkey | 1.9 |
|  United Arab Emirates | 0.2 |
|  United Kingdom | 8.6 |
|  Other<sup>1</sup> | 1.9 |
|  | 100.0% |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.1% |
|  Securities Lending Reinvestments | 0.9 |
|  Others<sup>(1)</sup> | 1 |
|  | 100.0% |

---

*<sup>(1)</sup><sup></sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 377

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – 98.5%** | **COMMON STOCKS – 98.5%** | **COMMON STOCKS – 98.5%** |
| **Auto Components – 0.8%** | **Auto Components – 0.8%** | **Auto Components – 0.8%** |
|  Fuyao Glass Industry Group Co. Ltd., Class H(a) | 34800 | $124795 |
|  Koito Manufacturing Co. Ltd. | 5800 | 82492 |
|  Magna International, Inc. | 3074 | 171092 |
|  Nexteer Automotive Group Ltd.(b) | 174000 | 94205 |
|  |  | **472584** |
| **Automobiles – 3.8%** | **Automobiles – 3.8%** | **Automobiles – 3.8%** |
|  Ford Otomotiv Sanayi A/S | 28101 | 548337 |
|  Geely Automobile Holdings Ltd.(b) | 251000 | 269870 |
|  Isuzu Motors Ltd. | 14500 | 170135 |
|  Mercedes-Benz Group AG | 12441 | 720549 |
|  Stellantis NV | 17197 | 232175 |
|  Yadea Group Holdings Ltd.(a) | 256000 | 390693 |
|  |  | **2331759** |
| **Banks – 13.8%** | **Banks – 13.8%** | **Banks – 13.8%** |
|  ABN AMRO Bank NV, CVA(a) | 15204 | 149607 |
|  Absa Group Ltd. | 2581 | 28052 |
|  Agricultural Bank of China Ltd., Class H | 464000 | 132405 |
|  Australia & New Zealand Banking Group Ltd. | 44979 | 735152 |
|  Banco Bilbao Vizcaya Argentaria SA | 76125 | 391915 |
|  Bank Polska Kasa Opieki SA | 34510 | 567337 |
|  BNP Paribas SA | 8642 | 405670 |
|  China Construction Bank Corp., Class H | 870000 | 462162 |
|  China Merchants Bank Co. Ltd., Class H | 113500 | 373039 |
|  Credit Agricole SA | 17574 | 159554 |
|  DBS Group Holdings Ltd. | 14563 | 351957 |
|  DNB Bank ASA | 9657 | 170906 |
|  Erste Group Bank AG | 19459 | 480038 |
|  Hana Financial Group, Inc. | 5510 | 159562 |
|  ING Groep NV | 29174 | 287015 |
|  KBC Group NV | 2204 | 110441 |
|  National Bank of Canada | 2900 | 197210 |
|  Nedbank Group Ltd. | 12296 | 145565 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Nordea Bank Abp | 24505 | $| 233997 |
|  Powszechna Kasa Oszczednosci Bank Polski SA | 101471 |  | 554424 |
|  Royal Bank of Canada(b) | 12412 |  | 1146976 |
|  Sberbank of Russia PJSC (Preference)\*‡ | 31920 |  |  |
|  Skandinaviska Enskilda Banken AB, Class A | 51736 |  | 545430 |
|  Societe Generale SA | 7511 |  | 172411 |
|  Standard Bank Group Ltd. | 57507 |  | 537128 |
|  |  |  | **8497953** |
| **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** | **Beverages – 1.3%** |
|  Ambev SA | 34800 |  | 106113 |
|  Diageo plc | 13572 |  | 562228 |
|  Thai Beverage PCL | 327700 |  | 133155 |
|  |  |  | **801496** |
| **Building Products – 0.2%** | **Building Products – 0.2%** | **Building Products – 0.2%** | **Building Products – 0.2%** |
|  Nibe Industrier AB, Class B | 19227 |  | 153288 |
| **Capital Markets – 4.4%** | **Capital Markets – 4.4%** | **Capital Markets – 4.4%** | **Capital Markets – 4.4%** |
|  3i Group plc | 38396 |  | 513025 |
|  Amundi SA(a) | 2755 |  | 130100 |
|  EQT AB(b) | 22504 |  | 443138 |
|  IGM Financial, Inc. | 8178 |  | 218651 |
|  Macquarie Group Ltd. | 2842 |  | 308035 |
|  Meritz Securities Co. Ltd. | 79721 |  | 207075 |
|  Samsung Securities Co. Ltd. | 19459 |  | 433728 |
|  SBI Holdings, Inc. | 26100 |  | 472007 |
|  |  |  | **2725759** |
| **Chemicals – 2.6%** | **Chemicals – 2.6%** | **Chemicals – 2.6%** | **Chemicals – 2.6%** |
|  BASF SE | 7946 |  | 356821 |
|  Nippon Sanso Holdings Corp. | 8000 |  | 127668 |
|  Nissan Chemical Corp. | 10200 |  | 459784 |
|  Shin-Etsu Chemical Co. Ltd. | 2900 |  | 303199 |
|  Wacker Chemie AG | 3277 |  | 381857 |
|  |  |  | **1629329** |
| **Communications Equipment – 0.0%(c)** | **Communications Equipment – 0.0%(c)** | **Communications Equipment – 0.0%(c)** | **Communications Equipment – 0.0%(c)** |
|  BYD Electronic International Co. Ltd.(b) | 3000 |  | 8714 |

---

*See Accompanying Notes to the Financial Statements.* 

378 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** |
|  Bouygues SA | 5104 | $145686 |
| **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** |
|  CRH plc | 1943 | 70055 |
| **Diversified Financial Services – 0.8%** | **Diversified Financial Services – 0.8%** | **Diversified Financial Services – 0.8%** |
|  REC Ltd. | 396169 | 490799 |
| **Diversified Telecommunication Services – 0.3%** | **Diversified Telecommunication Services – 0.3%** | **Diversified Telecommunication Services – 0.3%** |
|  Telefonica SA | 48546 | 167212 |
| **Electric Utilities – 1.0%** | **Electric Utilities – 1.0%** | **Electric Utilities – 1.0%** |
|  Endesa SA | 9338 | 155835 |
|  Enel SpA | 36482 | 162942 |
|  SSE plc | 9656 | 172987 |
|  Transmissora Alianca de Energia Eletrica SA | 20300 | 155483 |
|  |  | **647247** |
| **Electrical Equipment – 0.7%** | **Electrical Equipment – 0.7%** | **Electrical Equipment – 0.7%** |
|  Mitsubishi Electric Corp. | 20300 | 178915 |
|  WEG SA | 29000 | 222615 |
|  |  | **401530** |
| **Electronic Equipment, Instruments & Components – 0.8%** | **Electronic Equipment, Instruments & Components – 0.8%** | **Electronic Equipment, Instruments & Components – 0.8%** |
|  Innolux Corp. | 315800 | 116137 |
|  Kingboard Holdings Ltd. | 51500 | 127014 |
|  Kingboard Laminates Holdings Ltd.(b) | 159500 | 127399 |
|  Omron Corp. | 2900 | 135718 |
|  |  | **506268** |
| **Equity Real Estate Investment Trusts (REITs) – 0.9%** | **Equity Real Estate Investment Trusts (REITs) – 0.9%** | **Equity Real Estate Investment Trusts (REITs) – 0.9%** |
|  Fibra Uno Administracion SA de CV(b) | 139200 | 162139 |
|  Growthpoint Properties Ltd.(b) | 180322 | 127067 |
|  RioCan REIT(b) | 8497 | 120910 |
|  Stockland(b) | 63162 | 145400 |
|  |  | **555516** |
| **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** |
|  Cencosud SA | 29580 | 39803 |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Food Products – 1.7%** | **Food Products – 1.7%** | **Food Products – 1.7%** |
|  JBS SA | 23200 | $110357 |
|  Nestle SA (Registered) | 4669 | 508726 |
|  Uni-President China Holdings Ltd. | 609000 | 449971 |
|  |  | **1069054** |
| **Gas Utilities – 0.6%** | **Gas Utilities – 0.6%** | **Gas Utilities – 0.6%** |
|  AltaGas Ltd.(b) | 9309 | 167679 |
|  Kunlun Energy Co. Ltd. | 198000 | 118298 |
|  Naturgy Energy Group SA(b) | 2117 | 54317 |
|  |  | **340294** |
| **Health Care Equipment & Supplies – 2.5%** | **Health Care Equipment & Supplies – 2.5%** | **Health Care Equipment & Supplies – 2.5%** |
|  Carl Zeiss Meditec AG | 1160 | 140502 |
|  Coloplast A/S, Class B | 1218 | 135827 |
|  GN Store Nord A/S(b) | 4553 | 96832 |
|  Hoya Corp. | 6000 | 560097 |
|  Straumann Holding AG (Registered) | 4698 | 447759 |
|  Sysmex Corp. | 2900 | 156633 |
|  |  | **1537650** |
| **Health Care Providers & Services – 0.4%** | **Health Care Providers & Services – 0.4%** | **Health Care Providers & Services – 0.4%** |
|  Amplifon SpA | 5162 | 128261 |
|  Rede D'Or Sao Luiz SA\*(a) | 23200 | 142235 |
|  |  | **270496** |
| **Hotels, Restaurants & Leisure – 1.7%** | **Hotels, Restaurants & Leisure – 1.7%** | **Hotels, Restaurants & Leisure – 1.7%** |
|  Aristocrat Leisure Ltd. | 7656 | 181481 |
|  Evolution AB(a) | 2146 | 200609 |
|  OPAP SA | 37932 | 464877 |
|  Yum China Holdings, Inc. | 4292 | 177474 |
|  |  | **1024441** |
| **Household Durables – 1.3%** | **Household Durables – 1.3%** | **Household Durables – 1.3%** |
|  Barratt Developments plc | 29116 | 126112 |
|  Haier Smart Home Co. Ltd., Class H | 58000 | 145114 |
|  Persimmon plc | 27173 | 408278 |
|  Taylor Wimpey plc | 108257 | 116889 |
|  |  | **796393** |
| **Industrial Conglomerates – 1.3%** | **Industrial Conglomerates – 1.3%** | **Industrial Conglomerates – 1.3%** |
|  Melrose Industries plc | 93119 | 125331 |
|  Siemens AG (Registered) | 5916 | 646921 |
|  |  | **772252** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 379

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Insurance – 3.3%** | **Insurance – 3.3%** | **Insurance – 3.3%** |
|  Allianz SE (Registered) | 3161 | $569225 |
|  AXA SA | 14529 | 358993 |
|  BB Seguridade Participacoes SA | 31900 | 180497 |
|  Legal & General Group plc | 61596 | 165169 |
|  Manulife Financial Corp. | 16414 | 271712 |
|  Powszechny Zaklad Ubezpieczen SA | 23403 | 131451 |
|  Zurich Insurance Group AG | 870 | 371472 |
|  |  | **2048519** |
| **Interactive Media & Services – 2.1%** | **Interactive Media & Services – 2.1%** | **Interactive Media & Services – 2.1%** |
|  Autohome, Inc., ADR | 4205 | 109835 |
|  REA Group Ltd.(b) | 5916 | 459973 |
|  Rightmove plc | 61480 | 348121 |
|  SEEK Ltd. | 9773 | 134923 |
|  Tencent Holdings Ltd. | 8700 | 227867 |
|  |  | **1280719** |
| **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** |
|  momo.com, Inc. | 5000 | 74870 |
|  ZOZO, Inc. | 18600 | 396064 |
|  |  | **470934** |
| **IT Services – 0.6%** | **IT Services – 0.6%** | **IT Services – 0.6%** |
|  Capgemini SE | 1276 | 209664 |
|  Infosys Ltd. | 8526 | 158376 |
|  |  | **368040** |
| **Life Sciences Tools & Services – 0.2%** | **Life Sciences Tools & Services – 0.2%** | **Life Sciences Tools & Services – 0.2%** |
|  Sartorius AG (Preference) | 377 | 133058 |
| **Machinery – 4.4%** | **Machinery – 4.4%** | **Machinery – 4.4%** |
|  Atlas Copco AB, Class A(b) | 25955 | 277249 |
|  Atlas Copco AB, Class B | 4089 | 39571 |
|  Doosan Bobcat, Inc. | 5336 | 125491 |
|  FANUC Corp. | 3600 | 475446 |
|  Komatsu Ltd. | 8700 | 166701 |
|  MINEBEA MITSUMI, Inc. | 5800 | 86004 |
|  VAT Group AG(a)(b) | 2030 | 464116 |
|  Volvo AB, Class B | 12963 | 212092 |
|  Wartsila OYJ Abp | 44689 | 304762 |
|  Weichai Power Co. Ltd., Class H | 116000 | 111126 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** | **Machinery – (continued)** |
|  Yaskawa Electric Corp. | 12600 | $| 350106 |
|  Zoomlion Heavy Industry Science and Technology Co. Ltd., Class H(b) | 278400 |  | 89728 |
|  |  |  | **2702392** |
| **Marine – 2.6%** | **Marine – 2.6%** | **Marine – 2.6%** | **Marine – 2.6%** |
|  AP Moller – Maersk A/S, Class A | 203 |  | 406402 |
|  AP Moller – Maersk A/S, Class B | 213 |  | 445650 |
|  Hapag-Lloyd AG(a) | 87 |  | 15727 |
|  Mitsui OSK Lines Ltd.(b) | 6800 |  | 135007 |
|  Nippon Yusen KK(b) | 11900 |  | 216087 |
|  Orient Overseas International Ltd.(b) | 17500 |  | 255705 |
|  Yang Ming Marine Transport Corp. | 87000 |  | 162539 |
|  |  |  | **1637117** |
| **Media – 1.6%** | **Media – 1.6%** | **Media – 1.6%** | **Media – 1.6%** |
|  Publicis Groupe SA | 9193 |  | 515534 |
|  WPP plc | 57130 |  | 503849 |
|  |  |  | **1019383** |
| **Metals & Mining – 6.2%** | **Metals & Mining – 6.2%** | **Metals & Mining – 6.2%** | **Metals & Mining – 6.2%** |
|  BHP Group Ltd. | 65830 |  | 1572669 |
|  China Hongqiao Group Ltd. | 493000 |  | 349817 |
|  Fortescue Metals Group Ltd.(b) | 44486 |  | 418164 |
|  Gerdau SA (Preference) | 29000 |  | 142313 |
|  Kumba Iron Ore Ltd. | 19082 |  | 359253 |
|  MMC Norilsk Nickel PJSC‡ | 2128 |  |  |
|  Rio Tinto plc | 9976 |  | 521114 |
|  Severstal PAO‡ | 7952 |  |  |
|  Vedanta Ltd. | 143289 |  | 486069 |
|  |  |  | **3849399** |
| **Multi-Utilities – 0.3%** | **Multi-Utilities – 0.3%** | **Multi-Utilities – 0.3%** | **Multi-Utilities – 0.3%** |
|  Engie SA | 16240 |  | 211132 |
| **Oil, Gas & Consumable Fuels – 8.7%** | **Oil, Gas & Consumable Fuels – 8.7%** | **Oil, Gas & Consumable Fuels – 8.7%** | **Oil, Gas & Consumable Fuels – 8.7%** |
|  Adaro Energy Indonesia Tbk. PT | 1452900 |  | 370735 |
|  BP plc | 147784 |  | 816385 |
|  Canadian Natural Resources Ltd. | 17951 |  | 1075310 |
|  China Petroleum & Chemical Corp., Class H | 348000 |  | 137429 |

---

*See Accompanying Notes to the Financial Statements.* 

380 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Shares | Value | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Exxaro Resources Ltd. | 41934 | $| 466676 |
|  Keyera Corp.(b) | 6322 |  | 135334 |
|  Neste OYJ | 4089 |  | 179194 |
|  Ovintiv, Inc.(b) | 11223 |  | 568445 |
|  Pembina Pipeline Corp. | 5510 |  | 181694 |
|  Petroleo Brasileiro SA | 87000 |  | 551455 |
|  Petroleo Brasileiro SA (Preference) | 101500 |  | 576629 |
|  Shell plc | 3306 |  | 91505 |
|  Woodside Energy Group Ltd.(b) | 10325 |  | 237549 |
|  |  |  | **5388340** |
| **Personal Products – 1.9%** | **Personal Products – 1.9%** | **Personal Products – 1.9%** | **Personal Products – 1.9%** |
|  L'Oreal SA | 3770 |  | 1185266 |
| **Pharmaceuticals – 4.2%** | **Pharmaceuticals – 4.2%** | **Pharmaceuticals – 4.2%** | **Pharmaceuticals – 4.2%** |
|  Astellas Pharma, Inc. | 16400 |  | 225806 |
|  China Medical System Holdings Ltd. | 276000 |  | 301320 |
|  CSPC Pharmaceutical Group Ltd. | 522000 |  | 536640 |
|  GSK plc | 30276 |  | 498055 |
|  Novartis AG (Registered) | 783 |  | 63297 |
|  Novo Nordisk A/S, Class B | 232 |  | 25228 |
|  Orion OYJ, Class B | 11223 |  | 516344 |
|  Roche Holding AG | 667 |  | 221645 |
|  Takeda Pharmaceutical Co. Ltd. | 7000 |  | 184519 |
|  |  |  | **2572854** |
| **Professional Services – 1.7%** | **Professional Services – 1.7%** | **Professional Services – 1.7%** | **Professional Services – 1.7%** |
|  Adecco Group AG (Registered) | 3596 |  | 112614 |
|  Nihon M&A Center Holdings, Inc. | 19000 |  | 215138 |
|  Recruit Holdings Co. Ltd. | 22600 |  | 697911 |
|  |  |  | **1025663** |
| **Real Estate Management & Development – 1.2%** | **Real Estate Management & Development – 1.2%** | **Real Estate Management & Development – 1.2%** | **Real Estate Management & Development – 1.2%** |
|  China Evergrande Group\*(b) | 928000 |  | 72570 |
|  China Resources Land Ltd. | 64000 |  | 200564 |
|  Country Garden Holdings Co. Ltd.(b) | 248001 |  | 31909 |
|  Daiwa House Industry Co. Ltd. | 3900 |  | 79031 |
|  Land & Houses PCL, NVDR | 829400 |  | 200486 |
|  NEPI Rockcastle NV | 26419 |  | 132975 |
|  |  |  | **717535** |

---

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** |
|  Aurizon Holdings Ltd. | 195924 | $453527 |
| **Semiconductors & Semiconductor Equipment – 7.2%** | **Semiconductors & Semiconductor Equipment – 7.2%** | **Semiconductors & Semiconductor Equipment – 7.2%** |
|  ASM International NV | 1421 | 315719 |
|  ASML Holding NV | 4843 | 2287985 |
|  Globalwafers Co. Ltd. | 8000 | 89006 |
|  MediaTek, Inc. | 12000 | 219722 |
|  Novatek Microelectronics Corp. | 44000 | 329087 |
|  Silergy Corp. | 25000 | 290170 |
|  Taiwan Semiconductor Manufacturing Co. Ltd. | 49000 | 593064 |
|  Tokyo Electron Ltd. | 1300 | 345390 |
|  |  | **4470143** |
| **Software – 0.7%** | **Software – 0.7%** | **Software – 0.7%** |
|  SAP SE | 4669 | 450709 |
| **Specialty Retail – 1.5%** | **Specialty Retail – 1.5%** | **Specialty Retail – 1.5%** |
|  Fast Retailing Co. Ltd. | 400 | 223339 |
|  Industria de Diseno Textil SA(b) | 23577 | 534555 |
|  USS Co. Ltd. | 11600 | 175364 |
|  |  | **933258** |
| **Technology Hardware, Storage & Peripherals – 1.2%** | **Technology Hardware, Storage & Peripherals – 1.2%** | **Technology Hardware, Storage & Peripherals – 1.2%** |
|  Asustek Computer, Inc. | 19000 | 139157 |
|  Samsung Electronics Co. Ltd. | 8410 | 350700 |
|  Samsung Electronics Co. Ltd. (Preference) | 6554 | 245237 |
|  |  | **735094** |
| **Textiles, Apparel & Luxury Goods – 2.9%** | **Textiles, Apparel & Luxury Goods – 2.9%** | **Textiles, Apparel & Luxury Goods – 2.9%** |
|  Burberry Group plc | 7975 | 166654 |
|  Cie Financiere Richemont SA (Registered) | 7163 | 701019 |
|  Eclat Textile Co. Ltd. | 10000 | 131740 |
|  Li Ning Co. Ltd. | 2500 | 12930 |
|  LVMH Moet Hennessy Louis Vuitton SE | 116 | 73260 |
|  Moncler SpA | 3509 | 151522 |
|  Pandora A/S | 8178 | 431127 |
|  Shenzhou International Group Holdings Ltd. | 14500 | 100486 |
|  |  | **1768738** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 381

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

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---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** | **COMMON STOCKS – (continued)** |
| **Tobacco – 1.9%** | **Tobacco – 1.9%** | **Tobacco – 1.9%** |
|  Imperial Brands plc | 25694 | $628338 |
|  Japan Tobacco, Inc. | 34400 | 570267 |
|  |  | **1198605** |
| **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** |
|  Ferguson plc | 4843 | 530277 |
|  Rexel SA | 8381 | 149970 |
|  |  | **680247** |
| **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** | **Wireless Telecommunication Services – 0.2%** |
|  Total Access Communication PCL, NVDR | 37700 | 44574 |
|  Vodafone Group plc | 55042 | 64412 |
|  |  | **108986** |
| **Total Common Stocks <br>(Cost $75,550,979)** | **Total Common Stocks <br>(Cost $75,550,979)** | **60865236** |
| Investments | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(d) – 1.6%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.6%** | **SECURITIES LENDING REINVESTMENTS(d) – 1.6%** |
|  Citigroup Global Markets, Inc., 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $1,013,550, collateralized by various U.S. Treasury Securities, ranging from 0.75% – 5.50%, maturing 7/15/2028 – 1/15/2029; total market value $1,020,664<br>(Cost $1,013,466) | $1013466 | 1013466 |
| **Total Investments<br>(Cost $76,564,445) – 100.1%** | **Total Investments<br>(Cost $76,564,445) – 100.1%** | **61878702** |
| Liabilities in excess of other assets – (0.1%) | Liabilities in excess of other assets – (0.1%) | (90345) |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**61788357** |

---

*\** *Non-income producing security.* 

*<sup>(a)</sup>* *Security exempt from registration pursuant to Regulation S under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale.* 

*<sup>(b)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $6,321,311, collateralized in the form of cash with a value of $1,013,466 that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; $4,491,592 of collateral in the form of U.S. Government Treasury Securities, interest rates ranging from 0.00% – 6.63%, and maturity dates ranging from November 10, 2022 – May 15, 2052 and $1,306,179 of collateral in the form of Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 6.25%, and maturity dates ranging from April 19, 2023 – June 30, 2120; a total value of $6,811,237.* 

*<sup>(c)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(d)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $1,013,466.* 

*‡* *Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ADR – American Depositary Receipt* 

*CVA – Dutch Certification* 

*NVDR – Non-Voting Depositary Receipt* 

*OYJ – Public Limited Company* 

*PJSC – Public Joint Stock Company* 

*Preference – A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $2137449 |
|  Aggregate gross unrealized depreciation | (16971088) |
|  Net unrealized depreciation | $(14833639) |
|  Federal income tax cost | $76683848 |

---

*See Accompanying Notes to the Financial Statements.* 

382 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

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**Futures Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading <br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** |  |  |  |  |  |
|  MSCI EAFE E-Mini Index | 7 | 12/16/2022 | USD | $614565 | $(10074) |
|  MSCI Emerging Markets E-Mini Index | 6 | 12/16/2022 | USD | 256080 | (28440) |
|  |  |  |  |  | $(38514) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**Forward Foreign Currency Contracts** 

*FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund had the following outstanding contracts as of October 31, 2022:* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Contracts to Receive | Contracts to Receive | Counterparty | In Exchange For | In Exchange For | Maturity Date | Unrealized<br>Appreciation/<br>(Depreciation) |
|  USD | 121278 | Citibank NA | CHF | 116272 | 12/21/2022 | $4375 |
|  USD | 77706 | Morgan Stanley | EUR | 77284 | 12/21/2022 | 999 |
|  USD | 181348 | Bank of New York | JPY | 25724060 | 12/21/2022 | 7148 |
|  Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation | Total unrealized appreciation |  | $12522 |
|  CAD | 115542 | Toronto-Dominion Bank (The) | USD | 86800 | 12/21/2022 | $(2045) |
|  USD | 40972 | Bank of New York | GBP | 35918 | 12/21/2022 | (456) |
|  Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation | Total unrealized depreciation |  | $(2501) |
|  Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation | Net unrealized appreciation |  | $10021 |

---

*Abbreviations:* 

*CAD – Canadian Dollar* 

*CHF – Swiss Franc* 

*EUR – Euro* 

*GBP – British Pound* 

*JPY – Japanese Yen* 

*USD – US Dollar* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 383

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FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (cont.)

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*FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Australia | 7.5% |
|  Austria | 0.8 |
|  Belgium | 0.2 |
|  Brazil | 3.5 |
|  Canada | 6.9 |
|  Chile | 0.1 |
|  China | 9.0 |
|  Denmark | 2.5 |
|  Finland | 1.6 |
|  France | 6.0 |
|  Germany | 5.5 |
|  Greece | 0.7 |
|  India | 1.8 |
|  Indonesia | 0.6 |
|  Italy | 1.1 |
|  Japan | 11.6 |
|  Mexico | 0.3 |
|  Netherlands | 4.9 |
|  Norway | 0.3 |
|  Poland | 2.0 |
|  Singapore | 0.8 |
|  South Africa | 2.9 |
|  South Korea | 2.5 |
|  Spain | 2.1 |
|  Sweden | 3.4 |
|  Switzerland | 4.7 |
|  Taiwan | 3.5 |
|  Thailand | 0.4 |
|  Turkey | 0.9 |
|  United Kingdom | 10.4 |
|  Other<sup>1</sup> | 1.5 |
|  | 100.0% |

---

*<sup>1</sup>* *Includes any non-equity securities, securities lending reinvestments and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Common Stocks | 98.5% |
|  Securities Lending Reinvestments | 1.6 |
|  Others<sup>(1)</sup> | (0.1) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

384 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## Schedule of Investments

## FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **U.S. TREASURY OBLIGATIONS – 99.8%** | **U.S. TREASURY OBLIGATIONS – 99.8%** | **U.S. TREASURY OBLIGATIONS – 99.8%** |
|  U.S. Treasury Inflation Linked Bonds |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 1/15/2025 | $71729792 | $72523677 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/15/2026 | 121498045 | 122181471 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 1/15/2027 | 39391594 | 40372152 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 1/15/2028 | 36086872 | 36166517 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 4/15/2028 | 50102095 | 54874026 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/15/2029 | 31822993 | 33277714 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2029 | 57952067 | 65292851 |
|  U.S. Treasury Inflation Linked Notes |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 1/15/2024 | 84828656 | 83436935 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.50%, 4/15/2024 | 61667715 | 60377150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 7/15/2024 | 83355901 | 81270376 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 10/15/2024 | 66167334 | 64224961 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.25%, 1/15/2025 | 83554401 | 80725736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 4/15/2025 | 66417384 | 63693882 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 7/15/2025 | 83473398 | 80665137 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 10/15/2025 | 159372673 | 152404789 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 1/15/2026 | 215355399 | 207664435 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 4/15/2026 | 183350608 | 172963724 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 7/15/2026 | 185395072 | 175230932 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 10/15/2026 | 67682097 | 63691894 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 1/15/2027 | 76909546 | 72682525 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 4/15/2027(a) | 67270854 | 62732699 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 7/15/2027 | 72867778 | 68796006 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.63%, 10/15/2027 | 34593426 | 34639366 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.50%, 1/15/2028 | 76030725 | 71524568 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 7/15/2028 | 70525565 | 67108794 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 1/15/2029 | 69438048 | 66111260 |
| **Total U.S. Treasury Obligations <br>(Cost $2,273,651,424)** | **Total U.S. Treasury Obligations <br>(Cost $2,273,651,424)** | **2154633577** |
| **Total Investments <br>(Cost $2,273,651,424) – 99.8%** | **Total Investments <br>(Cost $2,273,651,424) – 99.8%** | **2154633577** |
|  Other Assets less Liabilities – 0.2% | Other Assets less Liabilities – 0.2% | 3305038 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**2157938615** |

---

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $62,732,699, collateralized in the form of U.S. Government Treasury Securities, interest rates ranging from 0.13% – 6.13%, and maturity dates ranging from January 15, 2026 – August 15, 2052; a total value of $65,292,514.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $472535 |
|  Aggregate gross unrealized depreciation | (132857075) |
|  Net unrealized depreciation | $(132384540) |
|  Federal income tax cost | $2287018117 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  U.S. Treasury Obligations | 99.8% |
|  Others<sup>(1)</sup> | 0.2 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 385

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **U.S. TREASURY OBLIGATIONS – 99.9%** | **U.S. TREASURY OBLIGATIONS – 99.9%** | **U.S. TREASURY OBLIGATIONS – 99.9%** |
|  U.S. Treasury Inflation Linked Bonds |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/15/2026 | $15332561 | $15418806 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 1/15/2027 | 12636093 | 12950637 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 1/15/2028 | 11988430 | 12014889 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 4/15/2028 | 13111034 | 14359783 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/15/2029 | 15248661 | 15945722 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2029 | 21249872 | 23941592 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 4/15/2032 | 3902785 | 4470264 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 2/15/2040 | 11837849 | 12375331 |
|  U.S. Treasury Inflation Linked Notes |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 1/15/2026 | 32529852 | 31368117 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 4/15/2026 | 30599467 | 28865996 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 7/15/2026(a) | 28246594 | 26697997 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 10/15/2026 | 29396180 | 27663126 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 1/15/2027 | 29504389 | 27882800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 4/15/2027(a) | 30215293 | 28176941 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 7/15/2027 | 28315810 | 26733554 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.63%, 10/15/2027 | 16511862 | 16533790 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.50%, 1/15/2028 | 41828786 | 39349695 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 7/15/2028 | 39510976 | 37596777 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 1/15/2029 | 38968586 | 37101594 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.25%, 7/15/2029 | 30520926 | 27842298 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 1/15/2030 | 31483953 | 28175985 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 7/15/2030(a) | 32885965 | 29343445 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 1/15/2031 | 33228834 | 29422662 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 7/15/2031 | 35911265 | 31644464 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.13%, 1/15/2032 | 39187876 | 34217444 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 7/15/2032 | 24981210 | 22876836 |
| **Total U.S. Treasury Obligations <br>(Cost $705,602,536)** | **Total U.S. Treasury Obligations <br>(Cost $705,602,536)** | **642970545** |
| **Total Investments <br>(Cost $705,602,536) – 99.9%** | **Total Investments <br>(Cost $705,602,536) – 99.9%** | **642970545** |
|  Other Assets less Liabilities – 0.1% | Other Assets less Liabilities – 0.1% | 915953 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**643886498** |

---

*<sup>(a)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $59,169,651, collateralized by $24,130,581 in U.S. Government Treasury Securities, interest rates ranging from 0.13% – 6.13%, and maturity dates ranging from January 15,* 

 *2026 – August 15, 2052 and $36,915,173 in Foreign Government Fixed Income Securities, interest rates ranging from 0.00% – 8.50%, and maturity dates ranging from November 2, 2022 – June 22, 2071; a total value of $61,045,754.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $— |
|  Aggregate gross unrealized depreciation | (71520022) |
|  Net unrealized depreciation | $(71520022) |
|  Federal income tax cost | $714490567 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  U.S. Treasury Obligations | 99.9% |
|  Others<sup>(1)</sup> | 0.1 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

386 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **MORTGAGE-BACKED SECURITIES – 99.0%** | **MORTGAGE-BACKED SECURITIES – 99.0%** | **MORTGAGE-BACKED SECURITIES – 99.0%** |
|  FHLMC | FHLMC | FHLMC |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 12/1/2026 | $92656 | $89695 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2027 | 384397 | 372101 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2027 | 318229 | 308057 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/1/2028 | 159673 | 152138 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 4/1/2028 | 500319 | 475798 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 6/1/2028 | 284395 | 266049 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 7/1/2028 | 247847 | 235044 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/1/2029 | 36447 | 34611 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/1/2030 | 408962 | 389378 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 8/1/2031 | 133480 | 119862 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 10/1/2031 | 29467 | 26458 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2033 | 117584 | 107669 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/1/2033 | 94496 | 86527 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2034 | 44597 | 44539 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2034 | 236515 | 237054 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 5/1/2035 | 16314 | 14937 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2035 | 242605 | 243159 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2035 | 89744 | 89949 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2035 | 15621 | 15600 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/1/2035 | 19033 | 17425 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 11/1/2035 | 152117 | 152464 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2035 | 94671 | 94887 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/1/2037 | 61678 | 63924 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2037 | 31283 | 32419 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/1/2037 | 53609 | 55557 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2038 | 46996 | 47104 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2038 | 140335 | 140656 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2038 | 42236 | 42332 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 11/1/2038 | 165018 | 164805 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2038 | 277318 | 276960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2039 | 112692 | 112949 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2039 | 60908 | 61048 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2039 | 22684 | 22736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2039 | 47386 | 47325 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/1/2039 | 58534 | 57996 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2039 | 32708 | 33897 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2039 | 197283 | 197735 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/1/2040 | 14882 | 14916 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2040 | 38246 | 38334 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 4/1/2040 | 17156 | 17195 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2040 | 37975 | 38947 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2040 | 16161 | 16140 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/1/2040 | 91762 | 94180 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2040 | $86426 | $86483 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 7/1/2040 | 144675 | 149738 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/1/2040 | 89147 | 89351 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2041 | 13434 | 12623 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2041 | 126002 | 125208 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2041 | 189402 | 189835 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/1/2041 | 58371 | 53026 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/1/2042 | 10460 | 9186 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2042 | 469575 | 455005 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2042 | 78404 | 68853 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/1/2042 | 66436 | 58344 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 8/1/2042 | 36760 | 32282 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/1/2042 | 258304 | 226758 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 12/1/2042 | 80155 | 70387 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2043 | 41327 | 36284 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2043 | 21586 | 18902 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/1/2043 | 113426 | 99613 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2043 | 26821 | 23539 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/1/2043 | 17102 | 15017 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/1/2043 | 51886 | 45555 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2044 | 11891 | 11143 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2044 | 34651 | 34731 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2045 | 36085 | 33816 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2045 | 81194 | 76090 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2045 | 415074 | 398886 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2045 | 90629 | 85047 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/1/2045 | 15305 | 14338 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2045 | 151109 | 141466 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/1/2045 | 31015 | 29098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2045 | 12928 | 12109 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2046 | 39518 | 36929 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 9/1/2046 | 23133 | 19326 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/1/2046 | 27395 | 23719 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2048 | 495371 | 444298 |
|  FHLMC UMBS | FHLMC UMBS | FHLMC UMBS |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 8/1/2026 | 61636 | 59752 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2027 | 97147 | 93926 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2027 | 52896 | 51088 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2027 | 346280 | 334324 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2027 | 32067 | 30620 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 3/1/2028 | 1066357 | 1013191 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 8/1/2029 | 141357 | 133651 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 8/1/2030 | 1060663 | 985750 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/1/2030 | 46364 | 43886 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 5/1/2031 | 95253 | 91772 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 387

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 8/1/2031 | $32569 | $29209 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 11/1/2031 | 53086 | 47555 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 12/1/2031 | 707485 | 657959 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/1/2032 | 105296 | 94433 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2032 | 412429 | 387061 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 2/1/2032 | 110893 | 99432 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 12/1/2032 | 861377 | 772504 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2033 | 1776782 | 1697342 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/1/2033 | 3926921 | 3692625 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2035 | 382885 | 383282 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 10/1/2035 | 1233083 | 1084099 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 2/1/2036 | 1277745 | 1088678 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 3/1/2036 | 825073 | 725097 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 4/1/2036 | 844932 | 719934 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2036 | 408182 | 418456 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 10/1/2036 | 692524 | 603777 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2038 | 53351 | 53406 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2039 | 74464 | 74275 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2039 | 26685 | 26713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/1/2040 | 26685 | 26808 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2040 | 42802 | 42846 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2040 | 58032 | 58093 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 7/1/2040 | 111798 | 92410 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 7/1/2040 | 667504 | 690810 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 10/1/2040 | 576536 | 456371 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2040 | 44539 | 40409 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/1/2041 | 178698 | 147706 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 2/1/2041 | 1283733 | 1061089 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 3/1/2041 | 751104 | 594496 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 3/1/2041 | 643216 | 531658 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2041 | 76356 | 73729 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 4/1/2041 | 216183 | 171107 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 4/1/2041 | 168363 | 139162 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2041 | 16198 | 15676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 5/1/2041 | 661528 | 523592 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2041 | 839719 | 712720 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2042 | 60889 | 57143 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2042 | 49512 | 49564 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/1/2042 | 118761 | 103858 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/1/2042 | 77026 | 69852 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 12/1/2042 | 514980 | 451562 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/1/2043 | 40661 | 36891 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/1/2043 | 27064 | 24553 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2043 | 405526 | 338398 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2043 | 11653 | 10906 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2044 | $56433 | $54613 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/1/2044 | 4313 | 4036 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/1/2044 | 21153 | 20471 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2044 | 12849 | 12026 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2044 | 770626 | 710211 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/1/2044 | 13900 | 13452 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2044 | 130621 | 129583 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2045 | 16239 | 15199 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/1/2045 | 14937 | 14219 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2045 | 41340 | 38725 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2045 | 20741 | 19414 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/1/2045 | 671370 | 647444 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2046 | 45009 | 39171 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2046 | 35394 | 33128 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2046 | 1106931 | 1036777 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2046 | 34791 | 33669 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/1/2046 | 1018941 | 953729 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2047 | 471179 | 452642 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/1/2048 | 458604 | 438272 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/1/2051 | 990067 | 944832 |
|  FNMA UMBS | FNMA UMBS | FNMA UMBS |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2025 | 760825 | 733075 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/1/2026 | 773146 | 758423 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/1/2026 | 856995 | 829225 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 12/1/2026 | 252478 | 244145 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2026 | 413663 | 399533 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2027 | 86554 | 83686 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2027 | 96550 | 93303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/1/2027 | 329706 | 317971 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 8/1/2027 | 341328 | 328863 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/1/2027 | 92129 | 88629 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/1/2027 | 498668 | 473174 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/1/2027 | 121189 | 114629 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 12/1/2027 | 228714 | 217682 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/1/2028 | 1804529 | 1716051 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 4/1/2028 | 75994 | 72223 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 9/1/2028 | 59957 | 57098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2028 | 108875 | 105111 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2029 | 152145 | 145551 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 3/1/2029 | 281290 | 267147 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2029 | 108291 | 103127 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2029 | 1753306 | 1692598 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 7/1/2030 | 264988 | 251662 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 7/1/2030 | 997237 | 954623 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 8/1/2030 | 1067688 | 992276 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 9/1/2030 | 1418173 | 1358709 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2030 | 59189 | 55849 |

---

*See Accompanying Notes to the Financial Statements.* 

388 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/1/2030 | $10410 | $9822 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 12/1/2030 | 204079 | 196001 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/1/2031 | 962841 | 929540 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 3/1/2031 | 546005 | 517154 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 9/1/2031 | 26858 | 24087 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 11/1/2031 | 64126 | 57508 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 2/1/2032 | 60136 | 53483 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2032 | 392529 | 378888 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/1/2032 | 11554 | 11846 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2033 | 6986 | 7148 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 5/1/2033 | 108909 | 99601 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/1/2033 | 103541 | 94699 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 7/1/2033 | 13648 | 12481 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/1/2033 | 23868 | 21828 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2034 | 789716 | 774668 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/1/2034 | 222371 | 227945 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/1/2034 | 38221 | 39187 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/1/2034 | 107142 | 110910 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/1/2034 | 173769 | 178145 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2035 | 906771 | 857366 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2035 | 654753 | 673441 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 7/1/2035 | 2108202 | 1982567 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2035 | 22692 | 22716 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 11/1/2035 | 864340 | 736276 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2035 | 33302 | 34142 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2035 | 50404 | 50456 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/1/2036 | 524902 | 461493 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2036 | 188852 | 188699 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2036 | 490721 | 474021 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2036 | 45389 | 46798 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 7/1/2036 | 1024937 | 900994 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 7/1/2036 | 802340 | 725818 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2036 | 21789 | 21811 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 8/1/2036 | 17588 | 18381 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/1/2036 | 713725 | 731720 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/1/2036 | 847827 | 739324 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2036 | 43075 | 44484 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 2/1/2037 | 1309556 | 1115282 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2037 | 98209 | 101106 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/1/2037 | 154110 | 158000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/1/2037 | 21698 | 22390 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2037 | 32338 | 33342 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2038 | 54763 | 54820 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2038 | 42647 | 42691 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/1/2038 | 14740 | 15235 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/1/2038 | $27695 | $28510 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2039 | 49492 | 49544 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2039 | 51585 | 51639 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2040 | 41595 | 42021 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2040 | 168238 | 168414 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2040 | 15972 | 15931 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2040 | 111569 | 114396 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 11/1/2040 | 735685 | 608115 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 12/1/2040 | 396063 | 327381 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/1/2041 | 185911 | 153670 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/1/2041 | 39277 | 35679 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 2/1/2041 | 830250 | 657221 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 2/1/2041 | 289719 | 242342 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/1/2041 | 24469 | 22185 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2041 | 122923 | 118605 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 4/1/2041 | 448256 | 354835 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 5/1/2041 | 863388 | 711521 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2041 | 40468 | 39111 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2041 | 34293 | 34329 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/1/2041 | 25520 | 26355 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2041 | 555763 | 536239 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 7/1/2041 | 850465 | 721866 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2041 | 452008 | 452479 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 7/1/2041 | 717800 | 740010 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/1/2041 | 122379 | 118413 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2041 | 67859 | 67929 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/1/2041 | 210334 | 197390 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/1/2041 | 76147 | 73474 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2041 | 136511 | 123851 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2041 | 53857 | 50542 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2041 | 66018 | 66087 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/1/2041 | 78434 | 73611 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2041 | 18354 | 17225 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2042 | 169094 | 158689 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/1/2042 | 18855 | 18247 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/1/2042 | 75599 | 78506 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/1/2042 | 149997 | 131560 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2042 | 86809 | 81411 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/1/2042 | 50391 | 44201 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2042 | 100800 | 97550 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 5/1/2042 | 25499 | 23135 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2042 | 73141 | 70782 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/1/2042 | 45375 | 41169 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2042 | 138907 | 126030 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/1/2042 | 118292 | 111012 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 8/1/2042 | 42798 | 38989 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 9/1/2042 | 72808 | 63857 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 389

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 9/1/2042 | $14566 | $13216 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/1/2042 | 71597 | 67191 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/1/2042 | 151126 | 132548 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2042 | 26359 | 23915 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 12/1/2042 | 244622 | 204131 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 12/1/2042 | 146054 | 128099 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 1/1/2043 | 8093 | 6755 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/1/2043 | 141056 | 123656 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/1/2043 | 40226 | 36480 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2043 | 77160 | 72415 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/1/2043 | 192360 | 186160 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 2/1/2043 | 759406 | 633456 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/1/2043 | 192899 | 169132 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/1/2043 | 74401 | 67499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/1/2043 | 90593 | 82190 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 5/1/2043 | 12850 | 10596 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2043 | 6889 | 5722 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2043 | 41080 | 38397 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/1/2043 | 98513 | 92411 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/1/2043 | 26593 | 25735 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2043 | 120341 | 112126 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/1/2043 | 253775 | 237533 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/1/2043 | 96492 | 93379 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/1/2043 | 65439 | 63166 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2044 | 96958 | 90577 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2044 | 19328 | 18705 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2044 | 109443 | 107684 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2044 | 20618 | 20410 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/1/2044 | 979595 | 913982 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2044 | 204052 | 197470 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2044 | 32207 | 32054 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2044 | 38785 | 36341 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2044 | 9093 | 8799 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/1/2044 | 35623 | 34474 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2045 | 27472 | 25713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2045 | 119635 | 115777 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/1/2045 | 25222 | 23607 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2045 | 11678 | 10928 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/1/2045 | 63801 | 59717 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/1/2045 | 79227 | 76672 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/1/2045 | 319112 | 298235 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2046 | 8432 | 7908 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2046 | 130557 | 125938 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/1/2046 | 11910 | 11159 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/1/2046 | 77145 | 64391 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2046 | $89137 | $86261 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/1/2046 | 18403 | 17634 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/1/2046 | 15497 | 14947 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 10/1/2046 | 62430 | 52101 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2046 | 30692 | 29364 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 12/1/2046 | 21380 | 17791 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/1/2047 | 27435 | 26279 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2047 | 31237 | 29226 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2047 | 34980 | 33852 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2047 | 188848 | 182757 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2047 | 565777 | 537454 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/1/2047 | 83996 | 81178 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2047 | 256081 | 256348 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2048 | 765015 | 740349 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/1/2048 | 136578 | 127798 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/1/2048 | 600631 | 572908 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2049 | 91834 | 96059 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/1/2049 | 951847 | 912744 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/1/2050 | 910256 | 836158 |
|  FNMA/FHLMC UMBS, 15 Year, Single Family | FNMA/FHLMC UMBS, 15 Year, Single Family | FNMA/FHLMC UMBS, 15 Year, Single Family |
| &nbsp;&nbsp;&nbsp;&nbsp; TBA 2.50%, 11/25/2037 | 1400000 | 1261228 |
|  GNMA | GNMA | GNMA |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/15/2033 | 49442 | 52105 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/20/2033 | 29805 | 30275 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/20/2033 | 27828 | 27779 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/15/2033 | 83256 | 87352 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/20/2034 | 34311 | 35106 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 7/20/2034 | 21544 | 22095 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/20/2034 | 9189 | 9218 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2035 | 21578 | 22741 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/20/2036 | 68243 | 70319 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/20/2038 | 40442 | 41677 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/20/2039 | 67507 | 69571 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2039 | 2103337 | 2048677 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 11/15/2039 | 1982808 | 1985367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/15/2040 | 330279 | 313893 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/15/2040 | 320504 | 304560 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/15/2040 | 248507 | 235737 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/20/2040 | 19616 | 20197 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/20/2041 | 20780 | 21418 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/20/2041 | 119344 | 122993 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/15/2041 | 977352 | 918623 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/15/2041 | 429330 | 417433 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/20/2041 | 194141 | 200029 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/20/2041 | 51777 | 52443 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/20/2042 | 14521 | 14966 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/15/2042 | 462558 | 425055 |

---

*See Accompanying Notes to the Financial Statements.* 

390 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** | **MORTGAGE-BACKED SECURITIES – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 3/20/2043 | $| 42945 | $37083 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 5/20/2043 |  | 62165 | 53678 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/20/2044 |  | 61416 | 63298 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/20/2044 |  | 125514 | 123159 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/20/2044 |  | 36655 | 31644 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/20/2045 |  | 161126 | 161693 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/15/2045 |  | 1861936 | 1743077 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/20/2045 |  | 264014 | 259009 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/20/2046 |  | 534798 | 551076 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/20/2046 |  | 901341 | 884342 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/20/2046 |  | 377669 | 379017 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/15/2046 |  | 2278774 | 2087597 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/20/2047 |  | 263750 | 271854 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/20/2048 |  | 144269 | 141940 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 7/20/2049 |  | 9959 | 10066 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/20/2051 |  | 456574 | 421379 |
| **Total Mortgage-Backed Securities <br>(Cost $107,353,373)** | **Total Mortgage-Backed Securities <br>(Cost $107,353,373)** | **Total Mortgage-Backed Securities <br>(Cost $107,353,373)** | **96171521** |
| **Total Investments <br>(Cost $107,353,373) – 99.0%** | **Total Investments <br>(Cost $107,353,373) – 99.0%** | **Total Investments <br>(Cost $107,353,373) – 99.0%** | **96171521** |
|  Other Assets less Liabilities – 1.0% | Other Assets less Liabilities – 1.0% | Other Assets less Liabilities – 1.0% | 1017432 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**97188953** |

---

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*FHLMC – Federal Home Loan Mortgage Corp.* 

*FNMA – Federal National Mortgage Association* 

*GNMA – Government National Mortgage Association* 

*TBA – To Be Announced; Security is subject to delayed delivery.* 

*UMBS – Uniform Mortgage-Backed Securities* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $— |
|  Aggregate gross unrealized depreciation | (11181553) |
|  Net unrealized depreciation | $(11181553) |
|  Federal income tax cost | $107353074 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Mortgage-Backed Securities | 99.0% |
|  Others<sup>(1</sup><sup>)</sup> | 1 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 391

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 97.0%** | **CORPORATE BONDS – 97.0%** | **CORPORATE BONDS – 97.0%** |
| **Aerospace & Defense – 0.8%** | **Aerospace & Defense – 0.8%** | **Aerospace & Defense – 0.8%** |
|  Boeing Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 5/1/2030 | $100000 | $92399 |
|  General Dynamics Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 5/15/2025 | 375000 | 363240 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 5/15/2028 | 600000 | 559768 |
|  L3Harris Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 6/15/2028 | 500000 | 467445 |
|  Leidos, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/15/2030 | 250000 | 218181 |
|  Lockheed Martin Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 1/15/2026 | 151000 | 145208 |
|  Precision Castparts Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 6/15/2025 | 135000 | 129619 |
|  |  | **1975860** |
| **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** |
|  CH Robinson Worldwide, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/15/2028 | 210000 | 191976 |
|  United Parcel Service, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 9/1/2029 | 1000000 | 850341 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 4/1/2030 | 50000 | 48007 |
|  |  | **1090324** |
| **Banks – 28.1%** | **Banks – 28.1%** | **Banks – 28.1%** |
|  Banco Bilbao Vizcaya Argentaria SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.14%, 9/14/2028(a) | 600000 | 570692 |
|  Banco Santander SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.18%, 11/19/2025 | 150000 | 142433 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.72%, 9/14/2027(a) | 600000 | 489704 |
|  Bank of America Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 3/3/2026 | 450000 | 431671 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 4/2/2026(a) | 2000000 | 1878878 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.73%, 7/22/2027(a) | 360000 | 307849 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series L,<br>4.18%, 11/25/2027 | 775000 | 709896 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.82%, 1/20/2028(a) | 500000 | 456459 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.71%, 4/24/2028(a) | 5000 | 4523 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 7/22/2028(a) | 775000 | 739216 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.42%, 12/20/2028(a) | 200000 | 176552 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.27%, 7/23/2029(a) | 300000 | 272275 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.97%, 2/7/2030(a) | $300000 | $265315 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.19%, 7/23/2030(a) | 250000 | 209145 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 2/13/2031(a) | 600000 | 471401 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.59%, 4/29/2031(a) | 188000 | 148434 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 7/23/2031(a) | 250000 | 185439 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series N,<br>2.65%, 3/11/2032(a) | 500000 | 385850 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.69%, 4/22/2032(a) | 162000 | 125202 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 7/21/2032(a) | 500000 | 370261 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.57%, 10/20/2032(a) | 250000 | 188610 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 3/8/2037(a) | 200000 | 160239 |
|  Bank of Montreal |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 3/8/2027 | 300000 | 265982 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series H,<br>4.70%, 9/14/2027 | 250000 | 239454 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 12/15/2032(a) | 500000 | 428704 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.09%, 1/10/2037(a) | 25000 | 18342 |
|  Bank of Nova Scotia (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/16/2025 | 350000 | 335937 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2,<br>3.62%, 10/27/2081(a) | 250000 | 176728 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.62%, 10/27/2082(a) | 300000 | 301604 |
|  BankUnited, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 6/11/2030 | 250000 | 224785 |
|  Barclays plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 9/11/2024 | 440000 | 418085 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 3/16/2025 | 150000 | 139343 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 5/12/2026 | 250000 | 228708 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 8/9/2026(a) | 450000 | 428386 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.84%, 5/9/2028 | 300000 | 254261 |
|  Canadian Imperial Bank of Commerce |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 1/28/2025 | 300000 | 279426 |
|  Citigroup, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 4/24/2025(a) | 600000 | 576134 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 6/10/2025 | 825000 | 798726 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/13/2025 | 650000 | 644301 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 3/9/2026 | 380000 | 364208 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.11%, 4/8/2026(a) | 500000 | 466707 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 5/1/2026 | 160000 | 148212 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 10/21/2026 | 300000 | 273198 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 9/29/2027 | 1000000 | 928167 |

---

*See Accompanying Notes to the Financial Statements.* 

392 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.89%, 1/10/2028(a) | $500000 | $457735 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.67%, 7/24/2028(a) | 500000 | 448489 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.98%, 11/5/2030(a) | 500000 | &nbsp;&nbsp;&nbsp;&nbsp;407882 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.67%, 1/29/2031(a) | 500000 | 397645 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.41%, 3/31/2031(a) | 636000 | 567545 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.57%, 6/3/2031(a) | 250000 | 195496 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.56%, 5/1/2032(a) | 50000 | 38098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 6/15/2032 | 300000 | 303634 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.06%, 1/25/2033(a) | 400000 | 311618 |
|  Citizens Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/30/2030 | 200000 | 164184 |
|  Comerica, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2029 | 300000 | 273641 |
|  Cooperatieve Rabobank UA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 7/21/2026 | 250000 | 227362 |
|  Discover Bank |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.45%, 9/12/2024 | 500000 | 469230 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 9/13/2028 | 250000 | 223051 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 2/6/2030 | 300000 | 229494 |
|  Fifth Third Bancorp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 1/16/2024 | 200000 | 197074 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 1/25/2024 | 450000 | 439746 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 5/5/2027 | 200000 | 174672 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.06%, 4/25/2028(a) | 500000 | 457534 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.77%, 7/28/2030(a) | 275000 | 252225 |
|  Fifth Third Bank NA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 3/15/2026 | 350000 | 326560 |
|  HSBC Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/11/2025(a) | 450000 | 429920 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 8/18/2025 | 1040000 | 967508 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.29%, 9/12/2026(a) | 650000 | 599273 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.04%, 3/13/2028(a) | 490000 | 429097 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.58%, 6/19/2029(a) | 870000 | 755499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 3/31/2030 | 250000 | 223819 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.97%, 5/22/2030(a) | 590000 | 486338 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.36%, 8/18/2031(a) | 50000 | 35612 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 5/24/2032(a) | 200000 | 143282 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.40%, 8/11/2033(a) | 600000 | 520194 |
|  Huntington Bancshares, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/15/2025 | 150000 | 144575 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 2/4/2030 | 200000 | 158748 |
|  ING Groep NV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 4/9/2024 | 150000 | 145635 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.73%, 4/1/2027(a) | $500000 | $425754 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.02%, 3/28/2028(a) | 500000 | 449691 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 10/2/2028 | 300000 | 270229 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 4/9/2029 | 200000 | 173899 |
|  JPMorgan Chase & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.02%, 12/5/2024(a) | 40000 | 39245 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 10/15/2025(a) | 120000 | 111926 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 3/13/2026(a) | 115000 | 104860 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.08%, 4/22/2026(a) | 1800000 | 1638592 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.96%, 1/29/2027(a) | 750000 | 702355 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.58%, 4/22/2027(a) | 250000 | 215013 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/29/2027 | 200000 | 218847 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 12/1/2027 | 200000 | 180687 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.78%, 2/1/2028(a) | 925000 | 845029 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.01%, 4/23/2029(a) | 130000 | 117176 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 7/23/2029(a) | 400000 | 361942 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 12/5/2029(a) | 500000 | 456021 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 5/6/2030(a) | 250000 | 217601 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.74%, 10/15/2030(a) | 200000 | 161356 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.49%, 3/24/2031(a) | 150000 | 135548 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.96%, 5/13/2031(a) | 500000 | 393367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 2/4/2032(a) | 225000 | 164810 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.96%, 1/25/2033(a) | 100000 | 78124 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.59%, 4/26/2033(a) | 400000 | 356218 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.91%, 7/25/2033(a) | 800000 | 727932 |
|  KeyCorp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 4/6/2027 | 300000 | 257064 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 4/30/2028 | 200000 | 183986 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 10/1/2029 | 150000 | 120779 |
|  Lloyds Banking Group plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.51%, 3/18/2026(a) | 600000 | 555216 |
|  M&T Bank Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 8/16/2028(a) | 120000 | 112935 |
|  Mitsubishi UFJ Financial<br>Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.41%, 3/7/2024 | 50000 | 48633 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.19%, 2/25/2025 | 700000 | 645701 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.68%, 2/22/2027 | 300000 | 275261 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.29%, 7/25/2027 | 700000 | 626983 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.34%, 1/19/2028(a) | 1000000 | 853328 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.74%, 3/7/2029 | 200000 | 175738 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 7/18/2029 | 500000 | 418969 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 7/17/2030 | 100000 | 74581 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.31%, 7/20/2032(a) | 500000 | 364576 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 393

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Mizuho Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.23%, 5/25/2026(a) | $700000 | $632989 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.23%, 5/22/2027(a) | 500000 | 420136 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.17%, 9/11/2027 | 450000 | 392988 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.02%, 3/5/2028 | 340000 | 305419 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 9/11/2029(a) | 500000 | 444214 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 7/16/2030(a) | 150000 | 122607 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.59%, 5/25/2031(a) | 250000 | 190817 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.56%, 9/13/2031 | 50000 | 35845 |
|  National Australia Bank Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.91%, 6/9/2027 | 550000 | 518838 |
|  NatWest Group plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.64%, 6/14/2027(a) | 450000 | 373882 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.08%, 1/27/2030(a) | 1250000 | 1113438 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.44%, 5/8/2030(a) | 950000 | 810974 |
|  PNC Bank NA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/10/2025 | 250000 | 239885 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 1/22/2028 | 200000 | 180723 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 7/26/2028 | 250000 | 226881 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 10/22/2029 | 500000 | 405422 |
|  PNC Financial Services Group, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 4/29/2024 | 550000 | 538191 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 5/19/2027 | 80000 | 71909 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 1/22/2030 | 250000 | 202417 |
|  Regions Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 5/18/2025 | 600000 | 553579 |
|  Royal Bank of Canada |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 1/27/2026 | 550000 | 530819 |
|  Santander Holdings USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/17/2025 | 190000 | 181622 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 7/13/2027 | 450000 | 406665 |
|  Santander UK Group Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.82%, 11/3/2028(a) | 200000 | 169768 |
|  Sumitomo Mitsui Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 7/16/2024 | 740000 | 704746 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.35%, 1/15/2025 | 200000 | 186175 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.47%, 7/8/2025 | 500000 | 446310 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 7/14/2026 | 550000 | 492713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.40%, 9/17/2026 | 450000 | 380929 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 1/11/2027 | 110000 | 100290 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.36%, 7/12/2027 | 400000 | 359395 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 9/17/2028 | $240000 | $190418 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.31%, 10/16/2028 | 450000 | 411848 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.47%, 1/14/2029 | 500000 | 405303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.04%, 7/16/2029 | 300000 | 247673 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.72%, 9/27/2029 | 250000 | 200683 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 1/15/2030 | 200000 | 159799 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 7/8/2030 | 250000 | 187551 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.14%, 9/23/2030 | 250000 | 183396 |
|  SVB Financial Group |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 6/5/2030 | 500000 | 389843 |
|  Toronto-Dominion Bank (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 3/11/2024 | 450000 | 437510 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 9/10/2026 | 350000 | 298043 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.62%, 9/15/2031(a) | 200000 | 179600 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.46%, 6/8/2032 | 770000 | 691990 |
|  Truist Bank |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 9/16/2025 | 500000 | 472990 |
|  Truist Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 10/26/2024 | 100000 | 95453 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/1/2025 | 160000 | 155015 |
|  US Bancorp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/5/2024 | 200000 | 195863 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 11/17/2025 | 200000 | 192950 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 4/26/2028 | 500000 | 465676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 7/22/2028(a) | 550000 | 522856 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 7/30/2029 | 200000 | 168848 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.97%, 7/22/2033(a) | 100000 | 91062 |
|  Wells Fargo & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/19/2025 | 450000 | 425009 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/29/2025 | 930000 | 880736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.41%, 10/30/2025(a) | 500000 | 465692 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/22/2026 | 450000 | 411814 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 6/3/2026 | 240000 | 226999 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 6/17/2027(a) | 1000000 | 905943 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 7/22/2027 | 1000000 | 935351 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.53%, 3/24/2028(a) | 500000 | 450227 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.58%, 5/22/2028(a) | 1110000 | 999128 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.39%, 6/2/2028(a) | 850000 | 726062 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 10/30/2030(a) | 450000 | 369208 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.57%, 2/11/2031(a) | 450000 | 358607 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.48%, 4/4/2031(a) | 500000 | 452373 |
|  Westpac Banking Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.89%, 2/4/2030(a) | 250000 | 228239 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.32%, 11/23/2031(a) | 200000 | 179544 |

---

*See Accompanying Notes to the Financial Statements.* 

394 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.11%, 7/24/2034(a) | $| 400000 | $| 330619 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.67%, 11/15/2035(a) |  | 300000 |  | 212522 |
|  |  |  |  | **68134858** |
| **Beverages – 0.8%** | **Beverages – 0.8%** | **Beverages – 0.8%** | **Beverages – 0.8%** | **Beverages – 0.8%** |
|  Coca-Cola Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 3/25/2030 |  | 150000 |  | 135760 |
|  Constellation Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 11/15/2028 |  | 300000 |  | 283785 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 8/1/2029 |  | 500000 |  | 427743 |
|  Keurig Dr Pepper, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 4/15/2029 |  | 300000 |  | 272164 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 4/15/2032 |  | 150000 |  | 131340 |
|  PepsiCo, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 3/1/2029 |  | 360000 |  | 397749 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 7/18/2032 |  | 200000 |  | 185202 |
|  |  |  |  | **1833743** |
| **Biotechnology – 2.2%** | **Biotechnology – 2.2%** | **Biotechnology – 2.2%** | **Biotechnology – 2.2%** | **Biotechnology – 2.2%** |
|  AbbVie, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/15/2025 |  | 1000000 |  | 964629 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 11/21/2026 |  | 500000 |  | 456615 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 11/14/2028 |  | 1000000 |  | 941317 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 11/21/2029 |  | 1500000 |  | 1311090 |
|  Amgen, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/22/2029 |  | 500000 |  | 436541 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.45%, 2/21/2030 |  | 250000 |  | 206042 |
|  Gilead Sciences, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 3/1/2026 |  | 280000 |  | 265109 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 3/1/2027 |  | 750000 |  | 681682 |
|  |  |  |  | **5263025** |
| **Building Products – 0.7%** | **Building Products – 0.7%** | **Building Products – 0.7%** | **Building Products – 0.7%** | **Building Products – 0.7%** |
|  Allegion plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2029 |  | 250000 |  | 209254 |
|  Carlisle Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 12/1/2027 |  | 150000 |  | 136863 |
|  Carrier Global Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.72%, 2/15/2030 |  | 250000 |  | 205558 |
|  Lennox International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 8/1/2025 |  | 450000 |  | 399527 |
|  Masco Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/15/2027 |  | 450000 |  | 403671 |
|  Owens Corning |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 8/15/2029 |  | 320000 |  | 280797 |
|  |  |  |  | **1635670** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Capital Markets – 6.3%** | **Capital Markets – 6.3%** | **Capital Markets – 6.3%** |
|  Ameriprise Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 9/15/2026 | $100000 | $91781 |
|  Ares Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.15%, 7/15/2026 | 500000 | 413946 |
|  Bain Capital Specialty Finance, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 10/13/2026 | 175000 | 141857 |
|  Bank of New York Mellon Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.45%, 8/17/2026 | 100000 | 90664 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.99%, 6/13/2028(a) | 300000 | 279498 |
|  BlackRock, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 3/15/2027 | 150000 | 140064 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/30/2029 | 350000 | 312215 |
|  Blackstone Secured Lending Fund |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 1/15/2026 | 700000 | 630599 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 2/15/2027 | 250000 | 201772 |
|  Cboe Global Markets, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 1/12/2027 | 150000 | 140414 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.63%, 12/15/2030 | 150000 | 112014 |
|  Charles Schwab Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 3/24/2025 | 300000 | 295490 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.45%, 3/3/2027 | 1900000 | 1695150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 1/25/2028 | 100000 | 90592 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2029 | 400000 | 370785 |
|  CME Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/15/2025 | 325000 | 310499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 6/15/2028 | 100000 | 93628 |
|  Credit Suisse AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 8/7/2026 | 400000 | 319676 |
|  Credit Suisse Group AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/26/2025 | 100000 | 89602 |
|  Deutsche Bank AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 5/30/2024 | 505000 | 487774 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.45%, 4/1/2025(a) | 500000 | 455808 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.96%, 11/26/2025(a) | 100000 | 92304 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 11/24/2026(a) | 250000 | 210192 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/18/2031(a) | 200000 | 148842 |
|  Goldman Sachs BDC, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/10/2025 | 150000 | 143935 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 395

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Goldman Sachs Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/3/2024 | $| 500000 | $| 490847 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 7/8/2024 |  | 500000 |  | 488826 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/23/2025 |  | 415000 |  | 396499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 4/1/2025 |  | 500000 |  | 473736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.43%, 3/9/2027(a) |  | 450000 |  | 384984 |
|  Lazard Group LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/13/2025 |  | 450000 |  | 432835 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/19/2028 |  | 250000 |  | 226754 |
|  Moody's Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/24/2025 |  | 250000 |  | 241800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2029 |  | 250000 |  | 232785 |
|  Morgan Stanley |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.79%, 5/30/2025(a) |  | 500000 |  | 458114 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.72%, 7/22/2025(a) |  | 500000 |  | 471915 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 7/27/2026 |  | 450000 |  | 410663 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.59%, 5/4/2027(a) |  | 500000 |  | 427878 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 4/20/2037(a) |  | 300000 |  | 266046 |
|  Nasdaq, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/30/2026 |  | 165000 |  | 157090 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.65%, 1/15/2031 |  | 100000 |  | 73689 |
|  Nomura Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.68%, 7/16/2030 |  | 500000 |  | 376227 |
|  S&P Global, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 1/22/2027 |  | 150000 |  | 137241 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 8/1/2028(b) |  | 500000 |  | 484688 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 3/1/2029(b) |  | 1000000 |  | 859313 |
|  State Street Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 8/18/2025 |  | 300000 |  | 288332 |
|  Stifel Financial Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/15/2030 |  | 100000 |  | 85043 |
|  |  |  |  | **15224406** |
| **Chemicals –1.3%** | **Chemicals –1.3%** | **Chemicals –1.3%** | **Chemicals –1.3%** | **Chemicals –1.3%** |
|  Air Products and Chemicals, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.85%, 5/15/2027 |  | 200000 |  | 174420 |
|  Cabot Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/1/2029 |  | 250000 |  | 216877 |
|  Celanese US Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 5/8/2024 |  | 150000 |  | 143800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 7/15/2032 |  | 700000 |  | 636918 |
|  Dow Chemical Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 11/1/2029 |  | 300000 |  | 324689 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  FMC Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 10/1/2026 | $| 150000 | $| 137207 |
|  Huntsman International LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2029 |  | 250000 |  | 217748 |
|  Nutrien Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/1/2029 |  | 100000 |  | 91599 |
|  PPG Industries, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/15/2028 |  | 200000 |  | 183527 |
|  Rohm and Haas Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.85%, 7/15/2029 |  | 250000 |  | 274000 |
|  RPM International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/15/2027 |  | 50000 |  | 45675 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 3/1/2029 |  | 250000 |  | 226161 |
|  Sherwin-Williams Co. (The) |  |  |  |  |
|  3.45%, 6/1/2027 |  | 500000 |  | 459329 |
|  |  |  |  | **3131950** |
| **Commercial Services & Supplies – 0.5%** | **Commercial Services & Supplies – 0.5%** | **Commercial Services & Supplies – 0.5%** | **Commercial Services & Supplies – 0.5%** | **Commercial Services & Supplies – 0.5%** |
|  Cintas Corp. No. 2 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/1/2027 |  | 350000 |  | 329969 |
|  RELX Capital, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 5/22/2030 |  | 200000 |  | 166757 |
|  Republic Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 11/15/2027 |  | 50000 |  | 45428 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 5/15/2028 |  | 150000 |  | 139409 |
|  Waste Connections, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 12/1/2028 |  | 200000 |  | 186473 |
|  Waste Management, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 11/15/2027 |  | 90000 |  | 82027 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.15%, 3/15/2028 |  | 250000 |  | 202655 |
|  |  |  |  | **1152718** |
| **Communications Equipment – 0.4%** | **Communications Equipment – 0.4%** | **Communications Equipment – 0.4%** | **Communications Equipment – 0.4%** | **Communications Equipment – 0.4%** |
|  Cisco Systems, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/4/2024 |  | 250000 |  | 246233 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 2/28/2026 |  | 50000 |  | 47223 |
|  Juniper Networks, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 8/15/2029 |  | 500000 |  | 428732 |
|  Motorola Solutions, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 2/23/2028 |  | 100000 |  | 93696 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 5/23/2029 |  | 300000 |  | 275789 |
|  |  |  |  | **1091673** |

---

*See Accompanying Notes to the Financial Statements.* 

396 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Consumer Finance – 1.7%** | **Consumer Finance – 1.7%** | **Consumer Finance – 1.7%** |
|  AerCap Ireland Capital DAC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.65%, 10/29/2024 | $200000 | $181527 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 1/30/2026 | 300000 | 255461 |
|  Ally Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/1/2031 | 200000 | 205122 |
|  American Express Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 5/3/2029 | 450000 | 408759 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.99%, 5/26/2033(a) | 750000 | 680453 |
|  American Honda Finance Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.00%, 9/10/2025 | &nbsp;&nbsp;&nbsp;&nbsp;200000 | 178264 |
|  Capital One Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 1/29/2024 | 100000 | 98013 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 10/30/2024 | 200000 | 190665 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.98%, 7/24/2026(a) | 300000 | 288244 |
|  PACCAR Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 8/11/2025 | 250000 | 241783 |
|  Synchrony Financial |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/23/2025 | 600000 | 568401 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 12/1/2027 | 450000 | 386976 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 3/19/2029 | 200000 | 179328 |
|  Toyota Motor Credit Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 9/20/2027 | 100000 | 97269 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 1/11/2028 | 100000 | 90342 |
|  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.45%, 6/29/2029 | 120000 | 115231 |
|  |  | **4165838** |
| **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** |
|  Amcor Finance USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2028 | 300000 | 273207 |
|  Avery Dennison Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/6/2028 | 150000 | 142090 |
|  Packaging Corp. of America |  |  |
|  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.00%, 12/15/2029 | 275000 | 229223 |
|  |  | **644520** |
| **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** |
|  Block Financial LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 7/15/2028 | 350000 | 287260 |
|  Corebridge Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.87%, 12/15/2052(a)(b) | 400000 | 360525 |
|  National Rural Utilities Cooperative Finance Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/20/2046(a) | 150000 | 133493 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** |
|  Synchrony Bank |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 8/23/2027 | $| 400000 | $| 377056 |
|  Voya Financial, Inc. |  |  |  |  |
|  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.70%, 1/23/2048(a) |  | 100000 |  | 77494 |
|  |  |  |  | **1235828** |
| **Diversified Telecommunication Services – 0.7%** | **Diversified Telecommunication Services – 0.7%** | **Diversified Telecommunication Services – 0.7%** | **Diversified Telecommunication Services – 0.7%** | **Diversified Telecommunication Services – 0.7%** |
|  British Telecommunications plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.62%, 12/15/2030(c) |  | 200000 |  | 228173 |
|  Deutsche Telekom International Finance BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 6/15/2030(c) |  | 100000 |  | 114429 |
|  Verizon Communications, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.33%, 9/21/2028 |  | 450000 |  | 421860 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.02%, 12/3/2029 |  | 175000 |  | 157727 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.68%, 10/30/2030 |  | 63000 |  | 46903 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 1/20/2031 |  | 450000 |  | 333761 |
|  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.55%, 3/21/2031 |  | 450000 |  | 355600 |
|  |  |  |  | **1658453** |
| **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** | **Electric Utilities – 3.4%** |
|  American Electric Power Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2062(a) |  | 450000 |  | 345534 |
|  Duke Energy Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.45%, 6/1/2030 |  | 300000 |  | 239126 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 1/15/2082(a) |  | 450000 |  | 315057 |
|  Evergy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 9/15/2029 |  | 175000 |  | 144522 |
|  Fortis, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.06%, 10/4/2026 |  | 150000 |  | 135197 |
|  ITC Holdings Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 11/15/2027 |  | 150000 |  | 135219 |
|  MidAmerican Energy Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 4/15/2029 |  | 950000 |  | 866907 |
|  NextEra Energy Capital Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 6/20/2024 |  | 1200000 |  | 1180954 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 6/15/2028 |  | 500000 |  | 412819 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/15/2032 |  | 200000 |  | 190038 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 12/1/2077(a) |  | 100000 |  | 78852 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.65%, 5/1/2079(a) |  | 175000 |  | 147845 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/15/2082(a) |  | 500000 |  | 380956 |
|  Sierra Pacific Power Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 5/1/2026 |  | 20000 |  | 18355 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 397

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Southern Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 21-A, 0.60%, 2/26/2024 | $| &nbsp;&nbsp;&nbsp;&nbsp;1000000 | $| 941588 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.48%, 8/1/2024(c) |  | 500000 |  | 491677 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 4.00%, 1/15/2051(a) |  | 500000 |  | 434745 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 21-A, 3.75%, 9/15/2051(a) |  | 500000 |  | 396298 |
|  Southwestern Electric Power Co. | Southwestern Electric Power Co. | Southwestern Electric Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series M, 4.10%, 9/15/2028 |  | 150000 |  | 137207 |
|  Virginia Electric and Power Co. | Virginia Electric and Power Co. | Virginia Electric and Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B,<br>3.75%, 5/15/2027 |  | 250000 |  | 234475 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A,<br>3.80%, 4/1/2028 |  | 500000 |  | 465458 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A,<br>2.88%, 7/15/2029 |  | 500000 |  | 429379 |
|  |  |  |  | **8122208** |
| **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** |
|  ABB Finance USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 4/3/2028 |  | 250000 |  | 233319 |
|  Emerson Electric Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 10/15/2026 |  | 150000 |  | 128180 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 12/21/2028 |  | 450000 |  | 374845 |
|  Hubbell, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 3/1/2026 |  | 150000 |  | 141604 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/15/2028 |  | 200000 |  | 181725 |
|  |  |  |  | **1059673** |
| **Electronic Equipment, Instruments & Components – 1.3%** | **Electronic Equipment, Instruments & Components – 1.3%** | **Electronic Equipment, Instruments & Components – 1.3%** | **Electronic Equipment, Instruments & Components – 1.3%** | **Electronic Equipment, Instruments & Components – 1.3%** |
|  Avnet, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/15/2026 |  | 125000 |  | 118539 |
|  CDW LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 5/1/2025 |  | 250000 |  | 237750 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.67%, 12/1/2026 |  | 450000 |  | 387012 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 4/1/2028 |  | 200000 |  | 176240 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.28%, 12/1/2028 |  | 250000 |  | 203051 |
|  Flex Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/15/2029 |  | 200000 |  | 178802 |
|  Jabil, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 5/15/2027 |  | 500000 |  | 463656 |
|  Keysight Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 4/6/2027 |  | 650000 |  | 622851 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** | **Electronic Equipment, Instruments & Components –<br>(continued)** |
|  Teledyne Technologies, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 4/1/2028 | 225000 | $| 186469 |
|  Trimble, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 6/15/2028 | &nbsp;&nbsp;&nbsp;&nbsp;250000 |  | 235087 |
|  Tyco Electronics Group SA |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 2/15/2026 | 150000 |  | 143066 |
|  Vontier Corp. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 4/1/2028 | 250000 |  | 192987 |
|  |  |  | **3145510** |
| **Entertainment – 0.6%** | **Entertainment – 0.6%** | **Entertainment – 0.6%** | **Entertainment – 0.6%** |
|  Activision Blizzard, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 6/15/2027 | 200000 |  | 185281 |
|  Electronic Arts, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 3/1/2026 | 50000 |  | 49584 |
|  Netflix, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/15/2028 | 800000 |  | 794000 |
|  Warnermedia Holdings, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.28%, 3/15/2032(b) | 500000 |  | 403874 |
|  |  |  | **1432739** |
| **Equity Real Estate Investment Trusts (REITs) – 6.5%** | **Equity Real Estate Investment Trusts (REITs) – 6.5%** | **Equity Real Estate Investment Trusts (REITs) – 6.5%** | **Equity Real Estate Investment Trusts (REITs) – 6.5%** |
|  Agree LP | Agree LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 6/15/2028 | 200000 |  | 159637 |
|  American Homes 4 Rent LP | American Homes 4 Rent LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 2/15/2029 | 160000 |  | 147672 |
|  American Tower Corp. | American Tower Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 3/15/2025 | 300000 |  | 277430 |
|  AvalonBay Communities, Inc. | AvalonBay Communities, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 6/1/2025 | 150000 |  | 143388 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/15/2025 | 50000 |  | 47110 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 3/1/2030 | 500000 |  | 404346 |
|  Boston Properties LP | Boston Properties LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 1/30/2031 | 190000 |  | 151358 |
|  Brandywine Operating Partnership LP | Brandywine Operating Partnership LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 10/1/2024 | 50000 |  | 47755 |
|  Brixmor Operating Partnership LP | Brixmor Operating Partnership LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 7/1/2030 | 150000 |  | 124431 |
|  Corporate Office Properties LP | Corporate Office Properties LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 1/15/2029 | 300000 |  | 223766 |
|  Crown Castle, Inc. | Crown Castle, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 7/15/2025 | 200000 |  | 178651 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 2/15/2028 | 200000 |  | 180288 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 11/15/2029 | 700000 |  | 582882 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.10%, 4/1/2031 | 300000 |  | 224046 |

---

*See Accompanying Notes to the Financial Statements.* 

398 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  CubeSmart LP | CubeSmart LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/15/2025 | $250000 | $237032 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/15/2030 | 200000 | 162167 |
|  EPR Properties | EPR Properties |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2027 | &nbsp;&nbsp;&nbsp;&nbsp;300000 | &nbsp;&nbsp;&nbsp;&nbsp;249052 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 4/15/2028 | 350000 | 287403 |
|  Equinix, Inc. | Equinix, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.45%, 5/15/2026 | 410000 | 352405 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 5/15/2028 | 500000 | 405555 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 11/18/2029 | 250000 | 209395 |
|  ERP Operating LP | ERP Operating LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 8/1/2027 | 45000 | 39967 |
|  Essex Portfolio LP | Essex Portfolio LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 5/1/2024 | 450000 | 439258 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2029 | 350000 | 310888 |
|  GLP Capital LP | GLP Capital LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/1/2023 | 555000 | 548751 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 6/1/2025 | 200000 | 192868 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 4/15/2026 | 500000 | 477280 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/1/2028 | 500000 | 463826 |
|  Healthpeak Properties, Inc. | Healthpeak Properties, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 1/15/2030 | 250000 | 206367 |
|  Highwoods Realty LP | Highwoods Realty LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/15/2028 | 200000 | 177397 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/15/2029 | 100000 | 84267 |
|  Host Hotels & Resorts LP | Host Hotels & Resorts LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series E,<br>4.00%, 6/15/2025 | 200000 | 188376 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series H, 3.38%, 12/15/2029 | 300000 | 238903 |
|  Invitation Homes Operating<br>Partnership LP | Invitation Homes Operating<br>Partnership LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 11/15/2028 | 300000 | 238778 |
|  Kilroy Realty LP | Kilroy Realty LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 10/1/2025 | 350000 | 333295 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 8/15/2029 | 50000 | 43394 |
|  Life Storage LP | Life Storage LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 10/15/2030 | 150000 | 112122 |
|  LifeStorage LP | LifeStorage LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2026 | 200000 | 185645 |
|  Mid-America Apartments LP | Mid-America Apartments LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 3/15/2029 | 300000 | 269741 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 3/15/2030 | 150000 | 123295 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  National Retail Properties, Inc. | National Retail Properties, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 6/15/2024 | $450000 | $438423 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/15/2027 | &nbsp;&nbsp;&nbsp;&nbsp;150000 | 131850 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 10/15/2028 | 90000 | 81580 |
|  Office Properties Income Trust | Office Properties Income Trust |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 6/15/2026 | 160000 | 116666 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 2/1/2027 | 500000 | 343585 |
|  Omega Healthcare Investors, Inc. | Omega Healthcare Investors, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 1/15/2026 | 250000 | 239557 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2028 | 300000 | 270355 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 10/1/2029 | 150000 | 119371 |
|  Physicians Realty LP | Physicians Realty LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/15/2027 | 150000 | 139324 |
|  Piedmont Operating Partnership LP | Piedmont Operating Partnership LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 8/15/2030 | 100000 | 75413 |
|  Prologis LP | Prologis LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 4/15/2030 | 200000 | 161037 |
|  Public Storage | Public Storage |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.09%, 9/15/2027 | 200000 | 181693 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.85%, 5/1/2028 | 300000 | 248909 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 11/9/2028 | 450000 | 370213 |
|  Realty Income Corp. | Realty Income Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/1/2025 | 200000 | 195221 |
|  Sabra Health Care LP | Sabra Health Care LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 8/15/2026 | 200000 | 181428 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 10/15/2029 | 150000 | 119062 |
|  Simon Property Group LP | Simon Property Group LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 10/1/2024 | 550000 | 529344 |
|  SITE Centers Corp. | SITE Centers Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 2/1/2025 | 129000 | 120647 |
|  Spirit Realty LP | Spirit Realty LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.10%, 3/15/2028 | 250000 | 196711 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 1/15/2030 | 200000 | 159682 |
|  Ventas Realty LP | Ventas Realty LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/1/2025 | 50000 | 47471 |
|  VICI Properties LP | VICI Properties LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/15/2032 | 750000 | 664493 |
|  Welltower, Inc. | Welltower, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/1/2025 | 200000 | 191139 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 1/15/2030 | 250000 | 204094 |
|  Weyerhaeuser Co. | Weyerhaeuser Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2030 | 500000 | 436965 |
|  WP Carey, Inc. | WP Carey, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 4/1/2024 | 195000 | 191992 |
|  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.00%, 2/1/2025 | 100000 | 96287 |
|  |  | **15722699** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 399

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Food & Staples Retailing – 0.3%** | **Food & Staples Retailing – 0.3%** | **Food & Staples Retailing – 0.3%** |
|  Costco Wholesale Corp. | Costco Wholesale Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 5/18/2024 | $250000 | $242860 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.38%, 6/20/2027 | 300000 | 258295 |
|  Walmart, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 9/9/2032 | 135000 | 127722 |
|  |  | **628877** |
| **Food Products – 1.5%** | **Food Products – 1.5%** | **Food Products – 1.5%** |
|  Campbell Soup Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 3/15/2028 | 100000 | 93798 |
|  Flowers Foods, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/1/2026 | &nbsp;&nbsp;&nbsp;&nbsp;250000 | 230164 |
|  General Mills, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/17/2028 | 200000 | 189059 |
|  Hershey Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.90%, 6/1/2025 | 450000 | 406303 |
|  Hormel Foods Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.70%, 6/3/2028 | 100000 | 84117 |
|  Kellogg Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B,<br>7.45%, 4/1/2031 | 250000 | 270186 |
|  Mondelez International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 5/4/2025 | 400000 | 365297 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 4/13/2030 | 92000 | 76539 |
|  Tyson Foods, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 3/1/2029 | 600000 | 562244 |
|  Unilever Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 5/5/2024 | 700000 | 676205 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 5/5/2027 | 150000 | 137019 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/22/2028 | 40000 | 36849 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 9/6/2029 | 500000 | 414678 |
|  |  | **3542458** |
| **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** |
|  Atmos Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/15/2027 | 200000 | 182399 |
|  Eastern Energy Gas<br>Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 12/15/2024 | 4000 | 3853 |
|  National Fuel Gas Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 7/15/2025 | 150000 | 147476 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2026 | 275000 | 269212 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 9/1/2028 | 100000 | 91373 |
|  |  | **694313** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Health Care Equipment & Supplies – 0.4%** | **Health Care Equipment & Supplies – 0.4%** | **Health Care Equipment & Supplies – 0.4%** |
|  Abbott Laboratories |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/15/2025 | $450000 | $438416 |
|  DH Europe Finance II Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 11/15/2024 | 250000 | 235995 |
|  Edwards Lifesciences Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 6/15/2028 | 150000 | 139443 |
|  Stryker Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 6/15/2030 | 50000 | 39311 |
|  |  | **853165** |
| **Health Care Providers & Services – 3.1%** | **Health Care Providers & Services – 3.1%** | **Health Care Providers & Services – 3.1%** |
|  AmerisourceBergen Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 12/15/2027 | 60000 | 54703 |
|  Centene Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 3/1/2031 | 220000 | 168850 |
|  Cigna Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/1/2027 | 500000 | 459471 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 3/15/2031 | 275000 | 218022 |
|  CVS Health Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/25/2028 | 229000 | 214876 |
|  Elevance Health, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 3/15/2026 | 1900000 | 1677931 |
|  Humana, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 2/3/2027 | 700000 | 586507 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/23/2029 | 500000 | 445491 |
|  Laboratory Corp. of America Holdings |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 2/1/2025 | 250000 | 239510 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.55%, 6/1/2026 | 250000 | 217041 |
|  McKesson Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 8/15/2026 | 500000 | 429476 |
|  Quest Diagnostics, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 6/30/2030 | 200000 | 167133 |
|  UnitedHealth Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 5/15/2027 | 250000 | 236264 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 10/15/2027 | 350000 | 316606 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/15/2028 | 1000000 | 930999 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 12/15/2028 | 15000 | 13949 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/15/2029 | 1100000 | 1022685 |
|  |  | **7399514** |
| **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** | **Hotels, Restaurants & Leisure – 0.9%** |
|  Choice Hotels International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 12/1/2029 | 250000 | 209435 |

---

*See Accompanying Notes to the Financial Statements.* 

400 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Marriott International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series EE, 5.75%, 5/1/2025 | $| 12000 | $| 12108 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/15/2027 |  | 300000 |  | 288740 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series FF,<br>4.63%, 6/15/2030 |  | 250000 |  | 224263 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series HH,<br>2.85%, 4/15/2031 |  | 450000 |  | 350128 |
|  McDonald's Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2027 |  | 800000 |  | 744998 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 4/1/2028 |  | 90000 |  | 83948 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 7/1/2030 |  | 250000 |  | 224133 |
|  |  |  |  | **2137753** |
| **Household Durables – 0.7%** |  |  |  |  |
|  DR Horton, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 10/15/2024 |  | 200000 |  | 188525 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 10/15/2026 |  | 450000 |  | 375872 |
|  Lennar Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/30/2024 |  | 300000 |  | 294542 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 11/29/2027 |  | 710000 |  | 656587 |
|  PulteGroup, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2026 |  | 290000 |  | 284552 |
|  |  |  |  | **1800078** |
| **Household Products – 0.4%** |  |  |  |  |
|  Colgate-Palmolive Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 3/15/2024 |  | 200000 |  | 196632 |
|  Procter & Gamble Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 2/2/2026 |  | 250000 |  | 235449 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 3/25/2027 |  | 95000 |  | 87589 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/25/2030 |  | 400000 |  | 357192 |
|  |  |  |  | **876862** |
| **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** | **Industrial Conglomerates – 1.0%** |
|  3M Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/1/2029 |  | 200000 |  | 179451 |
|  Honeywell International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 6/1/2025 |  | 1000000 |  | 917274 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/1/2026 |  | 250000 |  | 228430 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 8/15/2029 |  | 100000 |  | 87104 |
|  Pentair Finance Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/1/2029 |  | 500000 |  | 442925 |
|  Trane Technologies Global Holding Co. Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 8/21/2028 |  | 150000 |  | 137103 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** |
|  Trane Technologies Luxembourg Finance SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/21/2026 | $| 200000 | $| 186113 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/21/2029 |  | 200000 |  | 178309 |
|  |  |  |  | **2356709** |
| **Insurance – 3.3%** | **Insurance – 3.3%** | **Insurance – 3.3%** | **Insurance – 3.3%** | **Insurance – 3.3%** |
|  Aflac, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 4/1/2030 |  | &nbsp;&nbsp;&nbsp;&nbsp;200000 |  | 177351 |
|  Allied World Assurance Co. Holdings Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 10/29/2025 |  | 200000 |  | 189550 |
|  Allstate Corp. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 12/15/2025 |  | 150000 |  | 130145 |
|  American Equity Investment Life Holding Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2027 |  | 150000 |  | 140481 |
|  American International Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 6/30/2025 |  | 300000 |  | 278701 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A-9,<br>5.75%, 4/1/2048(a) |  | 200000 |  | 178746 |
|  Aon Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 5/28/2027 |  | 300000 |  | 266286 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 5/15/2030 |  | 200000 |  | 163906 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 8/23/2031 |  | 50000 |  | 37286 |
|  Aon Global Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 12/15/2025 |  | 400000 |  | 380601 |
|  Assurant, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 2/22/2030 |  | 100000 |  | 82307 |
|  AXIS Specialty Finance LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 1/15/2040(a) |  | 200000 |  | 162000 |
|  AXIS Specialty Finance plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 12/6/2027 |  | 200000 |  | 183230 |
|  Brown & Brown, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 9/15/2024 |  | 150000 |  | 146022 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 3/15/2031 |  | 250000 |  | 184520 |
|  Chubb INA Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 3/15/2025 |  | 270000 |  | 257769 |
|  Enstar Group Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 6/1/2029 |  | 200000 |  | 175721 |
|  Fairfax Financial Holdings Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 4/17/2028 |  | 250000 |  | 229918 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/29/2030 |  | 250000 |  | 219796 |
|  Fidelity National Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 6/15/2030 |  | 250000 |  | 200544 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 401

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  First American Financial Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 11/15/2024 | $| 200000 | $| 194205 |
|  Globe Life, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 9/15/2028 |  | 100000 |  | 95142 |
|  Hanover Insurance Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 9/1/2030 |  | &nbsp;&nbsp;&nbsp;&nbsp;250000 |  | 187145 |
|  Hartford Financial Services Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 8/19/2029 |  | 200000 |  | 166034 |
|  Manulife Financial Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 3/4/2026 |  | 200000 |  | 192441 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.48%, 5/19/2027 |  | 200000 |  | 177454 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.06%, 2/24/2032(a) |  | 50000 |  | 44054 |
|  Markel Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 9/17/2029 |  | 300000 |  | 254550 |
|  Marsh & McLennan Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/3/2024 |  | 516000 |  | 501536 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/10/2025 |  | 75000 |  | 71983 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 11/15/2030 |  | 465000 |  | 364334 |
|  Principal Financial Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 5/15/2029 |  | 300000 |  | 265613 |
|  Progressive Corp. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 3/26/2030 |  | 100000 |  | 86451 |
|  Prudential Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 3/15/2044(a) |  | 10000 |  | 9283 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.70%, 9/15/2048(a) |  | 300000 |  | 274386 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 10/1/2050(a) |  | 100000 |  | 77731 |
|  Reinsurance Group of America, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 5/15/2029 |  | 200000 |  | 177917 |
|  Trinity Acquisition plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 3/15/2026 |  | 150000 |  | 142948 |
|  Willis North America, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 5/15/2024 |  | 650000 |  | 628979 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 9/15/2029 |  | 500000 |  | 404552 |
|  |  |  |  | **8101618** |
| **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** |
|  Alphabet, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 8/15/2027 |  | 335000 |  | 281967 |
|  Meta Platforms, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 8/15/2032(b) |  | 150000 |  | 127626 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** | **Interactive Media & Services – (continued)** |
|  Weibo Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/5/2024 | $| 200000 | $| 188704 |
|  |  |  |  | **598297** |
| **Internet & Direct Marketing Retail – 0.1%** | **Internet & Direct Marketing Retail – 0.1%** | **Internet & Direct Marketing Retail – 0.1%** | **Internet & Direct Marketing Retail – 0.1%** | **Internet & Direct Marketing Retail – 0.1%** |
|  Alibaba Group Holding Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 2/9/2031 |  | 200000 |  | 143809 |
| **IT Services – 2.6%** | **IT Services – 2.6%** | **IT Services – 2.6%** | **IT Services – 2.6%** | **IT Services – 2.6%** |
|  Automatic Data Processing, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.70%, 5/15/2028 |  | 330000 |  | 280556 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 9/1/2030 |  | 150000 |  | 114541 |
|  Broadridge Financial Solutions, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 12/1/2029 |  | 250000 |  | 205366 |
|  Fiserv, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2029 |  | 1250000 |  | 1084524 |
|  Genpact Luxembourg Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 12/1/2024 |  | 250000 |  | 238098 |
|  Global Payments, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 11/15/2024 |  | 300000 |  | 274684 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 4/1/2026 |  | 250000 |  | 240066 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 6/1/2028 |  | 110000 |  | 99991 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 8/15/2029 |  | 300000 |  | 249358 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 8/15/2029 |  | 220000 |  | 207216 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 5/15/2030 |  | 200000 |  | 159155 |
|  International Business Machines Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/27/2025 |  | 500000 |  | 487866 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 7/27/2027 |  | 500000 |  | 477618 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 5/15/2030 |  | 600000 |  | 472665 |
|  Mastercard, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 3/3/2025 |  | 300000 |  | 281742 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 11/21/2026 |  | 50000 |  | 46482 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 6/1/2029 |  | 150000 |  | 132751 |
|  PayPal Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.65%, 6/1/2025 |  | 150000 |  | 137624 |
|  VeriSign, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 7/15/2027 |  | 450000 |  | 431439 |
|  Visa, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 4/15/2027 |  | 225000 |  | 198645 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 4/15/2030 |  | 300000 |  | 247182 |
|  Western Union Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 1/10/2025 |  | 350000 |  | 328528 |
|  |  |  |  | **6396097** |

---

*See Accompanying Notes to the Financial Statements.* 

402 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Life Sciences Tools & Services – 0.0%(d)** | **Life Sciences Tools & Services – 0.0%(d)** | **Life Sciences Tools & Services – 0.0%(d)** |
|  Agilent Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 3/12/2031 | $150000 | $116734 |
| **Machinery – 0.8%** | **Machinery – 0.8%** | **Machinery – 0.8%** |
|  Cummins, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 9/1/2030 | 150000 | 114245 |
|  Dover Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 11/15/2025 | 150000 | 141111 |
|  Fortive Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 6/15/2026 | 100000 | 91865 |
|  Illinois Tool Works, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 11/15/2026 | 200000 | 183338 |
|  nVent Finance Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 4/15/2028 | 250000 | 223341 |
|  Otis Worldwide Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.06%, 4/5/2025 | 250000 | 231293 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.29%, 4/5/2027 | 200000 | 175383 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.57%, 2/15/2030 | 50000 | 40756 |
|  Parker-Hannifin Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 6/14/2029 | 545000 | 472695 |
|  Stanley Black & Decker, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/15/2060(a) | 100000 | 82870 |
|  Westinghouse Air Brake Technologies Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 9/15/2028(c) | 150000 | 139528 |
|  |  | **1896425** |
| **Media – 0.4%** | **Media – 0.4%** | **Media – 0.4%** |
|  Charter Communications Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 3/15/2028 | 450000 | 403221 |
|  Fox Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.71%, 1/25/2029 | 300000 | 279245 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 4/8/2030 | 200000 | 169594 |
|  Interpublic Group of Cos., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/30/2030 | 200000 | 181587 |
|  |  | **1033647** |
| **Metals & Mining – 0.9%** | **Metals & Mining – 0.9%** | **Metals & Mining – 0.9%** |
|  AngloGold Ashanti Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 11/1/2028 | 250000 | 201902 |
|  ArcelorMittal SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/16/2029 | 200000 | 176704 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Freeport-McMoRan, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/1/2028 | $| 300000 | $| 269045 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 8/1/2030 |  | 300000 |  | 265221 |
|  Newmont Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 10/1/2029 |  | 300000 |  | 247771 |
|  Nucor Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 5/23/2027 |  | 250000 |  | 238265 |
|  Reliance Steel & Aluminum Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 8/15/2025 |  | 250000 |  | 222136 |
|  Rio Tinto Finance USA Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 7/15/2028 |  | 170000 |  | 182753 |
|  Steel Dynamics, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 12/15/2024 |  | 100000 |  | 94689 |
|  Vale Overseas Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 7/8/2030 |  | 250000 |  | 205656 |
|  |  |  |  | **2104142** |
| **Multiline Retail –0.4%** | **Multiline Retail –0.4%** | **Multiline Retail –0.4%** | **Multiline Retail –0.4%** | **Multiline Retail –0.4%** |
|  Dollar General Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2027 |  | 450000 |  | 422538 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/1/2027 |  | 480000 |  | 463507 |
|  Dollar Tree, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 5/15/2028 |  | 175000 |  | 162788 |
|  |  |  |  | **1048833** |
| **Multi-Utilities – 1.3%** | **Multi-Utilities – 1.3%** | **Multi-Utilities – 1.3%** | **Multi-Utilities – 1.3%** | **Multi-Utilities – 1.3%** |
|  Ameren Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 3/15/2028 |  | 500000 |  | 409230 |
|  Berkshire Hathaway Energy Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 4/15/2025 |  | 1100000 |  | 1077071 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/15/2028 |  | 100000 |  | 90380 |
|  CMS Energy Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/1/2050(a) |  | 300000 |  | 248736 |
|  Dominion Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/1/2054(a) |  | 200000 |  | 185526 |
|  Sempra Energy |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 2/1/2028 |  | 137000 |  | 122365 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/1/2029 |  | 500000 |  | 440779 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.12%, 4/1/2052(a) |  | 100000 |  | 75250 |
|  WEC Energy Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 12/15/2028 |  | 500000 |  | 408919 |
|  |  |  |  | **3058256** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 403

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – 7.7%** | **Oil, Gas & Consumable Fuels – 7.7%** | **Oil, Gas & Consumable Fuels – 7.7%** |
|  Boardwalk Pipelines LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 7/15/2027 | $250000 | $231058 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 5/3/2029 | 200000 | 182016 |
|  BP Capital Markets America, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.72%, 1/12/2032 | 170000 | 137866 |
|  Canadian Natural Resources Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/1/2027 | 550000 | 506329 |
|  Cheniere Corpus Christi Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 3/31/2025 | 200000 | 200030 |
|  Chevron Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 5/11/2027 | 350000 | 309533 |
|  Chevron USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 1/15/2028 | 450000 | 426075 |
|  Continental Resources, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2028 | 290000 | 260020 |
|  Coterra Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 5/15/2027(b) | 500000 | 460614 |
|  Devon Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/15/2030 | 500000 | 456127 |
|  Diamondback Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 3/24/2031 | 400000 | 326870 |
|  Eastern Gas Transmission & Storage, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/15/2029 | 200000 | 168238 |
|  Enbridge, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 7/15/2077(a) | 350000 | 300335 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 3/1/2078(a) | 350000 | 309533 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 20-A,<br>5.75%, 7/15/2080(a) | 550000 | 485985 |
|  Energy Transfer LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/15/2027 | 250000 | 229868 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 5/15/2028 | 250000 | 231727 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2029 | 100000 | 93712 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 5/15/2030 | 1500000 | 1274990 |
|  Enterprise Products Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2025 | 650000 | 625220 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 2/15/2027 | 300000 | 283005 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 10/16/2028 | 90000 | 82850 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 7/31/2029 | 250000 | 214903 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 1/31/2030 | 225000 | 187662 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series E,<br>5.25%, 8/16/2077(a) | 200000 | 156328 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 2/15/2078(a) | 350000 | 253557 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  EOG Resources, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/15/2030 | $200000 | $189478 |
|  EQT Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 2/1/2030(c) | &nbsp;&nbsp;&nbsp;&nbsp;250000 | &nbsp;&nbsp;&nbsp;&nbsp;256262 |
|  Exxon Mobil Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.99%, 3/19/2025 | 550000 | 526227 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.48%, 3/19/2030 | 500000 | 453120 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.61%, 10/15/2030 | 350000 | 295869 |
|  Hess Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 10/1/2029 | 275000 | 298020 |
|  Kinder Morgan, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/1/2028 | 640000 | 598310 |
|  Magellan Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2026 | 200000 | 195681 |
|  Marathon Oil Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 7/15/2027 | 150000 | 139738 |
|  Marathon Petroleum Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 4/1/2028 | 400000 | 359035 |
|  MPLX LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2025 | 450000 | 439587 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 3/1/2026 | 250000 | 217961 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/15/2028 | 550000 | 497557 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 9/1/2032 | 450000 | 407234 |
|  ONEOK Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 3/15/2025 | 400000 | 390545 |
|  ONEOK, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.85%, 1/15/2026 | 350000 | 348052 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 3/15/2029 | 750000 | 666327 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 3/15/2030 | 125000 | 101046 |
|  Phillips 66 Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 12/15/2029(b) | 275000 | 232298 |
|  Pioneer Natural Resources Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.13%, 1/15/2026 | 450000 | 392001 |
|  Plains All American Pipeline LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 9/15/2030 | 350000 | 291805 |
|  Sabine Pass Liquefaction LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2030 | 200000 | 182418 |
|  Spectra Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 10/15/2026 | 300000 | 275042 |
|  Targa Resources Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 1/15/2029 | 500000 | 498218 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 2/1/2031 | 150000 | 132346 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/15/2032 | 450000 | 369265 |
|  Tosco Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 2/15/2030 | 250000 | 286973 |

---

*See Accompanying Notes to the Financial Statements.* 

404 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  TotalEnergies Capital International SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.83%, 1/10/2030 | $| 500000 | $| 429153 |
|  Transcanada Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 3/15/2077(a) |  | 300000 |  | 243075 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/15/2079(a) |  | 300000 |  | 251250 |
|  Valero Energy Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/15/2028 |  | 200000 |  | 188232 |
|  Williams Cos., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 3/15/2031 |  | 200000 |  | 156700 |
|  |  |  |  | **18703276** |
| **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** | **Paper & Forest Products – 0.1%** |
|  Suzano Austria GmbH |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2029 |  | &nbsp;&nbsp;&nbsp;&nbsp;250000 |  | 238375 |
| **Personal Products – 0.4%** | **Personal Products – 0.4%** | **Personal Products – 0.4%** | **Personal Products – 0.4%** | **Personal Products – 0.4%** |
|  Estee Lauder Cos., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 12/1/2029 |  | 200000 |  | 167188 |
|  GSK Consumer Healthcare Capital US LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/24/2027(b) |  | 450000 |  | 406983 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/24/2029(b) |  | 500000 |  | 436055 |
|  |  |  |  | **1010226** |
| **Pharmaceuticals – 1.6%** | **Pharmaceuticals – 1.6%** | **Pharmaceuticals – 1.6%** | **Pharmaceuticals – 1.6%** | **Pharmaceuticals – 1.6%** |
|  Bristol-Myers Squibb Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 3/15/2032 |  | 200000 |  | 169193 |
|  Eli Lilly & Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/15/2029 |  | 350000 |  | 323652 |
|  Johnson & Johnson |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 3/3/2027 |  | 440000 |  | 409335 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 1/15/2028 |  | 410000 |  | 376890 |
|  Merck & Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.70%, 6/10/2027 |  | 450000 |  | 392061 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/7/2029 |  | 500000 |  | 456137 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.15%, 12/10/2031 |  | 150000 |  | 119070 |
|  Merck Sharp & Dohme Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.40%, 3/1/2028 |  | 150000 |  | 157626 |
|  Novartis Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 2/14/2025 |  | 100000 |  | 93548 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/20/2025 |  | 450000 |  | 426938 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 8/14/2030 |  | 200000 |  | 165455 |
|  Pfizer, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 3/15/2029 |  | 500000 |  | 457560 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 4/1/2030 |  | 125000 |  | 106731 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Zoetis, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 9/12/2027 | $| 95000 | $| 85112 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 8/20/2028 |  | 250000 |  | 230411 |
|  |  |  |  | **3969719** |
| **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** |
|  Equifax, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 12/1/2024 |  | 100000 |  | 94420 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 5/15/2030 |  | 200000 |  | 163352 |
|  Verisk Analytics, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/15/2025 |  | 250000 |  | 240877 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/15/2029 |  | 250000 |  | 228533 |
|  |  |  |  | **727182** |
| **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** | **Real Estate Management & Development – 0.1%** |
|  CBRE Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 3/1/2026 |  | 150000 |  | 146142 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 4/1/2031 |  | 100000 |  | 74522 |
|  |  |  |  | **220664** |
| **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** |
|  Burlington Northern Santa Fe LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 9/1/2024 |  | 450000 |  | 437324 |
|  Canadian National Railway Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 3/1/2026 |  | 400000 |  | 370467 |
|  CSX Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/1/2028 |  | 100000 |  | 93355 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 3/15/2029 |  | 200000 |  | 187227 |
|  JB Hunt Transport Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/1/2026 |  | 300000 |  | 287738 |
|  Norfolk Southern Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 6/1/2027 |  | 200000 |  | 182356 |
|  Union Pacific Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 5/20/2031 |  | 450000 |  | 363806 |
|  |  |  |  | **1922273** |
| **Semiconductors & Semiconductor Equipment – 2.3%** | **Semiconductors & Semiconductor Equipment – 2.3%** | **Semiconductors & Semiconductor Equipment – 2.3%** | **Semiconductors & Semiconductor Equipment – 2.3%** | **Semiconductors & Semiconductor Equipment – 2.3%** |
|  Broadcom Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 1/15/2027 |  | 690000 |  | 634091 |
|  Broadcom, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.46%, 9/15/2026 |  | 150000 |  | 137674 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2029(b) |  | 2000000 |  | 1754048 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 11/15/2030 |  | 149000 |  | 128151 |
|  KLA Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 11/1/2024 |  | 8000 |  | 7961 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 405

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** | **Semiconductors & Semiconductor Equipment – (continued)** |
|  Micron Technology, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.19%, 2/15/2027 | $| 290000 | $| 269028 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.66%, 2/15/2030 |  | 400000 |  | 356975 |
|  NXP BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 5/1/2027 |  | 300000 |  | 265362 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 6/1/2027 |  | &nbsp;&nbsp;&nbsp;&nbsp;400000 |  | 375001 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 6/18/2029 |  | 250000 |  | 224962 |
|  Qorvo, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 10/15/2029 |  | 200000 |  | 171021 |
|  Texas Instruments, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.38%, 3/12/2025 |  | 700000 |  | 646535 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 11/3/2027 |  | 250000 |  | 228118 |
|  TSMC Arizona Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/22/2027 |  | 500000 |  | 468237 |
|  |  |  |  | **5667164** |
| **Software – 1.8%** | **Software – 1.8%** | **Software – 1.8%** | **Software – 1.8%** | **Software – 1.8%** |
|  Adobe, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 2/1/2030 |  | 350000 |  | 290871 |
|  Autodesk, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 12/15/2031 |  | 200000 |  | 154193 |
|  Microsoft Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 12/15/2023 |  | 425000 |  | 420870 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 2/12/2025 |  | 640000 |  | 614547 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 11/3/2025 |  | 276000 |  | 265608 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 2/6/2027 |  | 339000 |  | 322207 |
|  Oracle Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 3/25/2028 |  | 600000 |  | 501908 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 4/1/2030 |  | 450000 |  | 366435 |
|  Roper Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.40%, 9/15/2027 |  | 475000 |  | 390296 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 9/15/2028 |  | 150000 |  | 139096 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 2/15/2031 |  | 250000 |  | 183710 |
|  VMware, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.40%, 8/15/2026 |  | 100000 |  | 85311 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.80%, 8/15/2028 |  | 950000 |  | 749855 |
|  |  |  |  | **4484907** |
| **Specialty Retail – 1.9%** | **Specialty Retail – 1.9%** | **Specialty Retail – 1.9%** | **Specialty Retail – 1.9%** | **Specialty Retail – 1.9%** |
|  Advance Auto Parts, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 10/1/2027 |  | 260000 |  | 212313 |
|  AutoNation, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/1/2030 |  | 200000 |  | 172208 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  AutoZone, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/15/2025 | $| 490000 | $| 465455 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 4/21/2026 |  | 75000 |  | 69810 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 6/1/2027 |  | 200000 |  | 186917 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2030 |  | 250000 |  | 224336 |
|  Best Buy Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 10/1/2028 |  | 150000 |  | 139100 |
|  Home Depot, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 9/15/2025 |  | 3000 |  | 2876 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 9/14/2027 |  | 400000 |  | 363789 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 12/6/2028 |  | 60000 |  | 56679 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/15/2032 |  | 500000 |  | 431470 |
|  Lowe's Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 4/15/2028 |  | 200000 |  | 161884 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 4/5/2029 |  | 500000 |  | 449508 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 4/1/2032 |  | 600000 |  | 517924 |
|  O'Reilly Automotive, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 3/15/2026 |  | 250000 |  | 238327 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 9/1/2027 |  | 150000 |  | 138328 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 6/1/2028 |  | 550000 |  | 518586 |
|  TJX Cos., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2030 |  | 150000 |  | 136591 |
|  |  |  |  | **4486101** |
| **Technology Hardware, Storage & Peripherals – 2.5%** | **Technology Hardware, Storage & Peripherals – 2.5%** | **Technology Hardware, Storage & Peripherals – 2.5%** | **Technology Hardware, Storage & Peripherals – 2.5%** | **Technology Hardware, Storage & Peripherals – 2.5%** |
|  Apple, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.13%, 5/11/2025 |  | 450000 |  | 411486 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 5/13/2025 |  | 250000 |  | 240658 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/23/2026 |  | 468000 |  | 446275 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 9/11/2026 |  | 500000 |  | 452064 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 2/9/2027 |  | 830000 |  | 787137 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 5/11/2027 |  | 365000 |  | 341823 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 11/13/2027 |  | 1240000 |  | 1146323 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.20%, 2/8/2028 |  | 1350000 |  | 1124362 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.40%, 8/5/2028 |  | 440000 |  | 364301 |
|  HP, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/17/2027 |  | 350000 |  | 308284 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2029 |  | 450000 |  | 393158 |
|  NetApp, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.88%, 6/22/2025 |  | 150000 |  | 135598 |
|  |  |  |  | **6151469** |
| **Textiles, Apparel & Luxury Goods – 0.0%(d)** | **Textiles, Apparel & Luxury Goods – 0.0%(d)** | **Textiles, Apparel & Luxury Goods – 0.0%(d)** | **Textiles, Apparel & Luxury Goods – 0.0%(d)** | **Textiles, Apparel & Luxury Goods – 0.0%(d)** |
|  Tapestry, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 7/15/2027 |  | 8000 |  | 7237 |

---

*See Accompanying Notes to the Financial Statements.* 

406 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Thrifts & Mortgage Finance – 0.1%** | **Thrifts & Mortgage Finance – 0.1%** | **Thrifts & Mortgage Finance – 0.1%** |
|  Radian Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 3/15/2027 | $300000 | $265437 |
| **Tobacco – 1.7%** | **Tobacco – 1.7%** | **Tobacco – 1.7%** |
|  Altria Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.35%, 5/6/2025 | 360000 | 332171 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 2/14/2026 | &nbsp;&nbsp;&nbsp;&nbsp;500000 | 479779 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 2/14/2029 | 200000 | 184116 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 5/6/2030 | 300000 | 243084 |
|  BAT Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.56%, 8/15/2027 | 790000 | 687777 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.73%, 3/25/2031 | 225000 | 164802 |
|  Philip Morris International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 5/1/2024 | 500000 | 482221 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 5/1/2025 | 473000 | 431068 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 2/25/2026 | 500000 | 458337 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 5/1/2026 | 450000 | 384234 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 8/15/2029 | 300000 | 256613 |
|  |  | **4104202** |
| **Trading Companies & Distributors – 0.1%** | **Trading Companies & Distributors – 0.1%** | **Trading Companies & Distributors – 0.1%** |
|  Aircastle Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 6/15/2026 | 250000 | 220649 |
| **Wireless Telecommunication Services – 0.1%** | **Wireless Telecommunication Services – 0.1%** | **Wireless Telecommunication Services – 0.1%** |
|  T-Mobile USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2030 | 150000 | 132690 |
| **Total Corporate Bonds <br>(Cost $265,179,777)** | **Total Corporate Bonds <br>(Cost $265,179,777)** | **234820853** |
| **Total Investments<br>(Cost $265,179,777) – 97.0%** | **Total Investments<br>(Cost $265,179,777) – 97.0%** | **234820853** |
|  Other assets less liabilities – 3.0% | Other assets less liabilities – 3.0% | 7318104 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**242138957** |

---

*<sup>(a)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(c)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*<sup>(d)</sup>* *Represents less than 0.05% of net assets.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $433 |
|  Aggregate gross unrealized depreciation | (30780036) |
|  Net unrealized depreciation | $(30779603) |
|  Federal income tax cost | $265600456 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 97.0% |
|  Others<sup>(1)</sup> | 3.0 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 407

------

##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares® Credit-Scored US Long Corporate Bond Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 97.7%** | **CORPORATE BONDS – 97.7%** | **CORPORATE BONDS – 97.7%** |
| **Aerospace & Defense – 1.4%** | **Aerospace & Defense – 1.4%** | **Aerospace & Defense – 1.4%** |
|  Boeing Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.81%, 5/1/2050 | $150000 | $129009 |
|  L3Harris Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 4/27/2045 | 100000 | 84915 |
|  Lockheed Martin Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.09%, 9/15/2052 | 125000 | 99940 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 6/15/2053 | 150000 | 119711 |
|  Precision Castparts Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 1/15/2043 | 100000 | 78680 |
|  |  | **512255** |
| **Auto Components – 0.2%** | **Auto Components – 0.2%** | **Auto Components – 0.2%** |
|  Lear Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/15/2049 | 75000 | 58497 |
| **Banks – 7.5%** | **Banks – 7.5%** | **Banks – 7.5%** |
|  Bank of America Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.11%, 1/29/2037 | 250000 | 240083 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 5/14/2038 | 200000 | 220619 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.31%, 4/22/2042(a) | 25000 | 17299 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.08%, 3/20/2051(a) | 100000 | 74292 |
|  Citigroup, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 1/30/2042 | 35000 | 32705 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.68%, 9/13/2043 | 150000 | 149068 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 5/6/2044 | 100000 | 84270 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/18/2046 | 135000 | 104447 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 7/23/2048 | 100000 | 80250 |
|  Cooperatieve Rabobank UA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/24/2041 | 100000 | 92575 |
|  Fifth Third Bancorp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 3/1/2038 | 125000 | 141640 |
|  HSBC Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.10%, 1/14/2042 | 50000 | 46396 |
|  JPMorgan Chase & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.40%, 5/15/2038 | 35000 | 36062 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 6/1/2045 | 350000 | 289554 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.33%, 4/22/2052(a) | 100000 | 64925 |
|  Regions Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 12/10/2037 | 100000 | 106796 |
|  Wells Fargo & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.07%, 4/30/2041(a) | 300000 | 203267 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/2/2043 | 265000 | 224784 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.61%, 1/15/2044 | $| 100000 | $| 87222 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 11/17/2045 |  | 150000 |  | 119620 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.01%, 4/4/2051(a) |  | 100000 |  | 84761 |
|  Westpac Banking Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 11/18/2041 |  | 250000 |  | 153405 |
|  |  |  |  | **2654040** |
| **Beverages – 1.2%** | **Beverages – 1.2%** | **Beverages – 1.2%** | **Beverages – 1.2%** | **Beverages – 1.2%** |
|  Brown-Forman Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2038 |  | 100000 |  | 83196 |
|  Constellation Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 11/15/2048 |  | 75000 |  | 64444 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 5/1/2050 |  | 50000 |  | 34895 |
|  Keurig Dr Pepper, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/15/2045 |  | 100000 |  | 79056 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 5/1/2050 |  | 100000 |  | 69706 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/15/2052 |  | 100000 |  | 78586 |
|  |  |  |  | **409883** |
| **Biotechnology – 4.7%** | **Biotechnology – 4.7%** | **Biotechnology – 4.7%** | **Biotechnology – 4.7%** | **Biotechnology – 4.7%** |
|  AbbVie, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 6/15/2044 |  | 200000 |  | 170934 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/15/2045 |  | 100000 |  | 83749 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 11/14/2048 |  | 200000 |  | 170299 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 11/21/2049 |  | 200000 |  | 155162 |
|  Amgen, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 11/15/2041 |  | 228000 |  | 203712 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 5/1/2045 |  | 200000 |  | 161367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.56%, 6/15/2048 |  | 100000 |  | 81163 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/21/2050 |  | 100000 |  | 66612 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.66%, 6/15/2051 |  | 250000 |  | 206445 |
|  Biogen, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/15/2051 |  | 100000 |  | 62295 |
|  Gilead Sciences, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 4/1/2044 |  | 150000 |  | 128933 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 10/1/2050 |  | 200000 |  | 121623 |
|  Regeneron Pharmaceuticals, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 9/15/2050 |  | 100000 |  | 58588 |
|  |  |  |  | **1670882** |
| **Building Products – 0.8%** | **Building Products – 0.8%** | **Building Products – 0.8%** | **Building Products – 0.8%** | **Building Products – 0.8%** |
|  Carrier Global Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.58%, 4/5/2050 |  | 200000 |  | 134162 |

---

*See Accompanying Notes to the Financial Statements.* 

408 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** |
|  Johnson Controls International plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/15/2047 | $| 100000 | $| 76761 |
|  Masco Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2047 |  | 50000 |  | 36807 |
|  Owens Corning |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 1/30/2048 |  | 50000 |  | 35594 |
|  |  |  |  | **283324** |
| **Capital Markets – 2.0%** | **Capital Markets – 2.0%** | **Capital Markets – 2.0%** | **Capital Markets – 2.0%** | **Capital Markets – 2.0%** |
|  CI Financial Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 6/15/2051 |  | 100000 |  | 56224 |
|  Goldman Sachs Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/1/2037 |  | 100000 |  | 98870 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/21/2045 |  | 85000 |  | 68509 |
|  Jefferies Group LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 1/20/2043 |  | 100000 |  | 91695 |
|  Moody's Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/17/2048 |  | 50000 |  | 41943 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/25/2052 |  | 100000 |  | 70616 |
|  Morgan Stanley |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 7/24/2042 |  | 75000 |  | 75996 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 1/27/2045 |  | 60000 |  | 46228 |
|  Nasdaq, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/28/2050 |  | 100000 |  | 63769 |
|  S&P Global, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/1/2052(b) |  | 50000 |  | 36392 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 8/15/2060 |  | 100000 |  | 50196 |
|  |  |  |  | **700438** |
| **Chemicals – 2.0%** | **Chemicals – 2.0%** | **Chemicals – 2.0%** | **Chemicals – 2.0%** | **Chemicals – 2.0%** |
|  Albemarle Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 12/1/2044 |  | 50000 |  | 42852 |
|  Dow Chemical Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.40%, 5/15/2039 |  | 58000 |  | 72202 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.55%, 11/30/2048 |  | 100000 |  | 86459 |
|  FMC Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2049 |  | 50000 |  | 37122 |
|  LYB International Finance BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 3/15/2044 |  | 100000 |  | 78151 |
|  LYB International Finance III LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 10/15/2049 |  | 50000 |  | 34404 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 5/1/2050 |  | 200000 |  | 137441 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 4/1/2051 |  | 200000 |  | 124552 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  LyondellBasell Industries NV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/26/2055 | $| 100000 | $| 71561 |
|  RPM International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 1/15/2048 |  | 50000 |  | 35552 |
|  |  |  |  | **720296** |
| **Communications Equipment – 1.1%** | **Communications Equipment – 1.1%** | **Communications Equipment – 1.1%** | **Communications Equipment – 1.1%** | **Communications Equipment – 1.1%** |
|  Cisco Systems, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.90%, 2/15/2039 |  | 200000 |  | 204162 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2040 |  | 100000 |  | 97739 |
|  Motorola Solutions, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/1/2044 |  | 100000 |  | 82718 |
|  |  |  |  | **384619** |
| **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** | **Construction & Engineering – 0.2%** |
|  Valmont Industries, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2044 |  | 100000 |  | 80334 |
| **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** | **Containers & Packaging – 0.3%** |
|  International Paper Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/15/2041 |  | 100000 |  | 93191 |
| **Diversified Telecommunication Services – 4.5%** | **Diversified Telecommunication Services – 4.5%** | **Diversified Telecommunication Services – 4.5%** | **Diversified Telecommunication Services – 4.5%** | **Diversified Telecommunication Services – 4.5%** |
|  AT&T, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/15/2055 |  | 100000 |  | 63636 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 12/1/2057 |  | 282000 |  | 185831 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 9/15/2059 |  | 150000 |  | 94619 |
|  Bell Canada (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.46%, 4/1/2048 |  | 150000 |  | 118799 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 7/29/2049 |  | 25000 |  | 18982 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 8/15/2052 |  | 200000 |  | 135062 |
|  Telefonica Emisiones SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.21%, 3/8/2047 |  | 150000 |  | 112773 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.52%, 3/1/2049 |  | 150000 |  | 117810 |
|  TELUS Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 6/15/2049 |  | 50000 |  | 37790 |
|  Verizon Communications, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/22/2041 |  | 300000 |  | 213295 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 11/20/2050 |  | 100000 |  | 59012 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 3/22/2051 |  | 200000 |  | 135000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/1/2052 |  | 250000 |  | 176663 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.99%, 10/30/2056 |  | 100000 |  | 57539 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/22/2061 |  | 100000 |  | 65409 |
|  |  |  |  | **1592220** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 409

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Electric Utilities – 5.1%** | **Electric Utilities – 5.1%** | **Electric Utilities – 5.1%** |
|  AEP Texas, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 5/15/2051 | $100000 | $64806 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/15/2052 | 150000 | 130766 |
|  American Electric Power Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 3/1/2050 | 50000 | 31078 |
|  Appalachian Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 4/1/2038 | 100000 | 105569 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series Y, 4.50%, 3/1/2049 | 100000 | 77423 |
|  Dominion Energy South Carolina, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.10%, 6/1/2065 | 50000 | 42861 |
|  Duke Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 12/15/2045 | 150000 | 121190 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 9/1/2046 | 150000 | 103080 |
|  Emera US Finance LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/15/2046 | 100000 | 74144 |
|  Georgia Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/15/2043 | 100000 | 79510 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 3.70%, 1/30/2050 | 200000 | 142133 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, 3.25%, 3/15/2051 | 200000 | 129519 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/15/2052 | 100000 | 89474 |
|  MidAmerican Energy Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/15/2049 | 100000 | 79934 |
|  Pacific Gas and Electric Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 7/1/2050 | 50000 | 37272 |
|  PacifiCorp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 10/15/2037 | 100000 | 99410 |
|  Tucson Electric Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/15/2050 | 100000 | 72598 |
|  Virginia Electric and Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.88%, 11/15/2038 | 200000 | 249123 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 4.63%, 5/15/2052 | 100000 | 83004 |
|  |  | **1812894** |
| **Electronic Equipment, Instruments & Components – 0.6%** | **Electronic Equipment, Instruments & Components – 0.6%** | **Electronic Equipment, Instruments & Components – 0.6%** |
|  Corning, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 11/15/2057 | 125000 | 89056 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 11/15/2079 | 100000 | 80199 |
|  Tyco Electronics Group SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 10/1/2037 | 50000 | 55060 |
|  |  | **224315** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Entertainment – 0.3%** | **Entertainment – 0.3%** | **Entertainment – 0.3%** |
|  Electronic Arts, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 2/15/2051 | $50000 | $31080 |
|  Warnermedia Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.14%, 3/15/2052(b) | 100000 | 69822 |
|  |  | **100902** |
| **Equity Real Estate Investment Trusts (REITs) – 1.0%** | **Equity Real Estate Investment Trusts (REITs) – 1.0%** | **Equity Real Estate Investment Trusts (REITs) – 1.0%** |
|  American Homes 4 Rent LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 4/15/2052 | 50000 | 34447 |
|  Crown Castle, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 2/15/2049 | 100000 | 82784 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 7/1/2050 | 70000 | 49922 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 1/15/2051 | 100000 | 61148 |
|  National Retail Properties, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 4/15/2051 | 150000 | 93030 |
|  Weyerhaeuser Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/9/2052 | 50000 | 35067 |
|  |  | **356398** |
| **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** |
|  Campbell Soup Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 4/24/2050 | 100000 | 63119 |
|  Conagra Brands, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.40%, 11/1/2048 | 100000 | 85582 |
|  General Mills, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.40%, 6/15/2040 | 50000 | 46184 |
|  Mondelez International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 9/4/2050 | 50000 | 28931 |
|  Tyson Foods, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.10%, 9/28/2048 | 100000 | 87399 |
|  |  | **311215** |
| **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** |
|  Atmos Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 10/15/2044 | 115000 | 88553 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 10/1/2048 | 100000 | 78961 |
|  |  | **167514** |
| **Health Care Equipment & Supplies – 0.5%** | **Health Care Equipment & Supplies – 0.5%** | **Health Care Equipment & Supplies – 0.5%** |
|  Abbott Laboratories |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 11/30/2046 | 100000 | 93326 |
|  Becton Dickinson and Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.79%, 5/20/2050 | 68000 | 49215 |
|  DH Europe Finance II Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 11/15/2049 | 50000 | 35082 |
|  |  | **177623** |

---

*See Accompanying Notes to the Financial Statements.* 

410 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Health Care Providers & Services – 4.7%** | **Health Care Providers & Services – 4.7%** | **Health Care Providers & Services – 4.7%** |
|  AmerisourceBergen Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 12/15/2047 | $75000 | $57704 |
|  Cardinal Health, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.37%, 6/15/2047 | 150000 | 109659 |
|  Cigna Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 11/15/2041 | 100000 | 97887 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 12/15/2048 | 100000 | 84906 |
|  CVS Health Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 3/25/2048 | 210000 | 178383 |
|  Elevance Health, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 5/15/2052 | 310000 | 254165 |
|  Humana, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.15%, 6/15/2038 | 25000 | 28047 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 8/15/2049 | 130000 | 95825 |
|  Laboratory Corp. of America Holdings |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 2/1/2045 | 100000 | 80973 |
|  UnitedHealth Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 2/15/2041 | 100000 | 100035 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/15/2041 | 220000 | 191043 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 8/15/2049 | 75000 | 55652 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 5/15/2051 | 15000 | 10181 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2052 | 100000 | 87473 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2059 | 100000 | 73182 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 5/15/2060 | 125000 | 77303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 5/15/2062 | 100000 | 87851 |
|  |  | **1670269** |
| **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** | **Hotels, Restaurants & Leisure – 1.3%** |
|  McDonald's Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/15/2040 | 50000 | 43971 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/9/2045 | 125000 | 108154 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 3/1/2047 | 100000 | 81476 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 9/1/2048 | 100000 | 81136 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 9/1/2049 | 100000 | 70544 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 4/1/2050 | 100000 | 78231 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 9/9/2052 | 15000 | 13472 |
|  |  | **476984** |
| **Household Durables – 0.1%** | **Household Durables – 0.1%** | **Household Durables – 0.1%** |
|  MDC Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.97%, 8/6/2061 | 100000 | 49855 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Household Products – 0.3%** | **Household Products – 0.3%** | **Household Products – 0.3%** |
|  Church & Dwight Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2052 | $100000 | $87486 |
| **Industrial Conglomerates – 0.1%** | **Industrial Conglomerates – 0.1%** | **Industrial Conglomerates – 0.1%** |
|  Trane Technologies Luxembourg Finance SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/21/2049 | 50000 | 38237 |
| **Insurance – 6.4%** | **Insurance – 6.4%** | **Insurance – 6.4%** |
|  Aflac, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.45%, 8/15/2040 | 50000 | 49743 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2049 | 50000 | 41227 |
|  Alleghany Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 9/15/2044 | 75000 | 64422 |
|  Allstate Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 8/10/2049 | 30000 | 21729 |
|  American Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/15/2047 | 60000 | 45252 |
|  American International Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 6/30/2050 | 40000 | 31204 |
|  Aon Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 9/30/2040 | 50000 | 49690 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 2/28/2052 | 100000 | 70879 |
|  Aon Global Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 6/14/2044 | 55000 | 44172 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2045 | 100000 | 81691 |
|  Arch Capital Group Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.35%, 5/1/2034 | 200000 | 214730 |
|  Arthur J Gallagher & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 5/20/2051 | 50000 | 32203 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 3/9/2052 | 65000 | 37780 |
|  Athene Holding Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 5/15/2052 | 10000 | 5872 |
|  Berkshire Hathaway Finance Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 3/15/2052 | 100000 | 73348 |
|  Brown & Brown, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 3/17/2052 | 50000 | 37995 |
|  Chubb INA Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 12/15/2061 | 50000 | 29444 |
|  Everest Reinsurance Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/15/2050 | 100000 | 63367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 10/15/2052 | 50000 | 28992 |
|  Fidelity National Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 9/17/2051 | 45000 | 24072 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 411

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  Hartford Financial Services Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 9/15/2051 | $| 165000 | $| 96674 |
|  Markel Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 4/5/2046 |  | 100000 |  | 83605 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 9/17/2050 |  | 125000 |  | 88350 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 5/7/2052 |  | 100000 |  | 63197 |
|  Marsh & McLennan Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/15/2039 |  | 100000 |  | 85899 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 3/15/2049 |  | 100000 |  | 85360 |
|  MetLife, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 8/1/2039 |  | 100000 |  | 129201 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 5/13/2046 |  | 100000 |  | 83271 |
|  Old Republic International Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/11/2051 |  | 50000 |  | 32429 |
|  Progressive Corp. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/15/2052 |  | 50000 |  | 35411 |
|  Prudential Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/13/2051 |  | 100000 |  | 70881 |
|  Selective Insurance Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 3/1/2049 |  | 25000 |  | 20188 |
|  Unum Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 6/15/2051 |  | 95000 |  | 59800 |
|  W R Berkley Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/15/2037 |  | 100000 |  | 100252 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 8/1/2044 |  | 100000 |  | 82027 |
|  Willis North America, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 9/15/2048 |  | 100000 |  | 78701 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/15/2049 |  | 50000 |  | 32925 |
|  |  |  |  | **2275983** |
| **Interactive Media & Services – 0.9%** | **Interactive Media & Services – 0.9%** | **Interactive Media & Services – 0.9%** | **Interactive Media & Services – 0.9%** | **Interactive Media & Services – 0.9%** |
|  Alphabet, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 8/15/2060 |  | 75000 |  | 40949 |
|  Meta Platforms, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 8/15/2052(b) |  | 10000 |  | 7421 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 8/15/2062(b) |  | 365000 |  | 269197 |
|  |  |  |  | **317567** |
| **Internet & Direct Marketing Retail – 0.5%** | **Internet & Direct Marketing Retail – 0.5%** | **Internet & Direct Marketing Retail – 0.5%** | **Internet & Direct Marketing Retail – 0.5%** | **Internet & Direct Marketing Retail – 0.5%** |
|  Alibaba Group Holding Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 12/6/2047 |  | 225000 |  | 135811 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 2/9/2051 |  | 80000 |  | 38723 |
|  |  |  |  | **174534** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **IT Services – 2.4%** | **IT Services – 2.4%** | **IT Services – 2.4%** |
|  Fidelity National Information Services, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 7/15/2052 | $100000 | $87388 |
|  Fiserv, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 7/1/2049 | 30000 | 22556 |
|  Global Payments, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 8/15/2049 | 100000 | 67426 |
|  International Business Machines Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 5/15/2039 | 100000 | 81406 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 5/15/2049 | 150000 | 116432 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.43%, 2/9/2052 | 100000 | 65173 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 7/27/2052 | 273000 | 229968 |
|  PayPal Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 6/1/2052 | 100000 | 86656 |
|  Western Union Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.20%, 6/21/2040 | 100000 | 86842 |
|  |  | **843847** |
| **Leisure Products – 0.1%** | **Leisure Products – 0.1%** | **Leisure Products – 0.1%** |
|  Hasbro, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.35%, 3/15/2040 | 50000 | 45730 |
| **Machinery – 0.6%** | **Machinery – 0.6%** | **Machinery – 0.6%** |
|  Dover Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 3/1/2041 | 100000 | 90467 |
|  Illinois Tool Works, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 9/1/2042 | 25000 | 19970 |
|  Otis Worldwide Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.11%, 2/15/2040 | 50000 | 34718 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.36%, 2/15/2050 | 100000 | 64861 |
|  |  | **210016** |
| **Media – 3.6%** | **Media – 3.6%** | **Media – 3.6%** |
|  Charter Communications Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.48%, 10/23/2045 | 100000 | 88543 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/1/2048 | 400000 | 320832 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 3/1/2050 | 100000 | 70773 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/1/2051 | 100000 | 59946 |
|  Comcast Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.94%, 11/1/2056 | 135000 | 78067 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.99%, 11/1/2063 | 100000 | 56320 |

---

*See Accompanying Notes to the Financial Statements.* 

412 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Fox Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.48%, 1/25/2039 | $| 100000 | $| 85877 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.58%, 1/25/2049 |  | 150000 |  | 124985 |
|  Interpublic Group of Cos., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.40%, 10/1/2048 |  | 50000 |  | 42306 |
|  Time Warner Cable LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.30%, 7/1/2038 |  | 200000 |  | 186708 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 6/15/2039 |  | 100000 |  | 88491 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/15/2040 |  | 100000 |  | 81117 |
|  |  |  |  | **1283965** |
| **Metals & Mining – 3.2%** | **Metals & Mining – 3.2%** | **Metals & Mining – 3.2%** | **Metals & Mining – 3.2%** | **Metals & Mining – 3.2%** |
|  ArcelorMittal SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 3/1/2041(c) |  | 100000 |  | 90411 |
|  Barrick North America Finance LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/1/2043 |  | 100000 |  | 93529 |
|  Barrick PD Australia Finance Pty. Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 10/15/2039 |  | 80000 |  | 76694 |
|  Freeport-McMoRan, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 3/15/2043 |  | 200000 |  | 164300 |
|  Newmont Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 3/15/2042 |  | 150000 |  | 126450 |
|  Nucor Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 4/1/2052 |  | 50000 |  | 35141 |
|  Rio Tinto Finance USA Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 11/2/2051 |  | 50000 |  | 30804 |
|  Teck Resources Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 3/1/2042 |  | 50000 |  | 39519 |
|  Vale Overseas Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/21/2036 |  | 500000 |  | 485953 |
|  |  |  |  | **1142801** |
| **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** |
|  Dollar General Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 4/3/2050 |  | 50000 |  | 37717 |
| **Multi-Utilities – 2.7%** | **Multi-Utilities – 2.7%** | **Multi-Utilities – 2.7%** | **Multi-Utilities – 2.7%** | **Multi-Utilities – 2.7%** |
|  Berkshire Hathaway Energy Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2036 |  | 200000 |  | 202736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 1/15/2049 |  | 100000 |  | 80305 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 10/15/2050 |  | 150000 |  | 115843 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 5/15/2051 |  | 200000 |  | 119874 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Multi-Utilities – (continued)** | **Multi-Utilities – (continued)** | **Multi-Utilities – (continued)** | **Multi-Utilities – (continued)** | **Multi-Utilities – (continued)** |
|  Consolidated Edison Co. of New York, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2058 | $| 130000 | $| 98322 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 6/15/2061 |  | 100000 |  | 66057 |
|  Dominion Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, 4.60%, 3/15/2049 |  | 100000 |  | 80635 |
|  NiSource, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2052 |  | 100000 |  | 83378 |
|  Sempra Energy |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2048 |  | 100000 |  | 71305 |
|  Southern Co. Gas Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.40%, 5/30/2047 |  | 50000 |  | 37424 |
|  |  |  |  | **955879** |
| **Oil, Gas & Consumable Fuels – 14.6%** | **Oil, Gas & Consumable Fuels – 14.6%** | **Oil, Gas & Consumable Fuels – 14.6%** | **Oil, Gas & Consumable Fuels – 14.6%** | **Oil, Gas & Consumable Fuels – 14.6%** |
|  BP Capital Markets America, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/17/2052 |  | 75000 |  | 46453 |
|  Canadian Natural Resources Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2037 |  | 100000 |  | 96330 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 3/15/2038 |  | 100000 |  | 96153 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/1/2039 |  | 100000 |  | 98946 |
|  Cenovus Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 11/15/2039 |  | 45000 |  | 44267 |
|  Columbia Pipeline Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.80%, 6/1/2045 |  | 50000 |  | 44940 |
|  ConocoPhillips Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.03%, 3/15/2062 |  | 50000 |  | 37010 |
|  Continental Resources, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 6/1/2044 |  | 100000 |  | 70939 |
|  Devon Energy Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2045 |  | 70000 |  | 58428 |
|  Diamondback Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 3/15/2052 |  | 85000 |  | 61366 |
|  Enbridge, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/1/2046 |  | 25000 |  | 22427 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 8/1/2051 |  | 100000 |  | 64739 |
|  Energy Transfer LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.80%, 6/15/2038 |  | 100000 |  | 85360 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/1/2042 |  | 200000 |  | 183784 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/15/2044(c) |  | 50000 |  | 37904 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 12/15/2045 |  | 100000 |  | 85776 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/15/2049 |  | 100000 |  | 87235 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/15/2050 |  | 160000 |  | 121496 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 413

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Enterprise Products Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 2/1/2041 | $180000 | $170505 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 2/15/2043 | 100000 | 78974 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 3/15/2044 | 230000 | 189057 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2048 | 85000 | 63093 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 1/31/2051 | 85000 | 57213 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 1/31/2060 | 150000 | 99621 |
|  Exxon Mobil Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 4/15/2051 | 100000 | 71474 |
|  Hess Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2040 | 50000 | 46833 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.80%, 4/1/2047 | 100000 | 90673 |
|  Kinder Morgan Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.95%, 1/15/2038 | 100000 | 99368 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/1/2039 | 150000 | 141767 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 3/1/2041 | 100000 | 92413 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2044 | 150000 | 126707 |
|  Kinder Morgan, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.55%, 6/1/2045 | 125000 | 108041 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 2/15/2046 | 50000 | 40441 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 3/1/2048 | 100000 | 81895 |
|  Magellan Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 10/15/2043 | 15000 | 12241 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 10/3/2047 | 145000 | 102657 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 2/1/2049 | 100000 | 77600 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 3/1/2050 | 100000 | 68194 |
|  Marathon Oil Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 6/1/2045 | 100000 | 81995 |
|  Marathon Petroleum Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 3/1/2041 | 100000 | 97387 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2048 | 105000 | 78867 |
|  MPLX LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 4/15/2048 | 200000 | 149157 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/15/2049 | 100000 | 83446 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 3/14/2052 | 200000 | 154612 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 4/15/2058 | 150000 | 108752 |
|  ONEOK Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.85%, 10/15/2037 | 200000 | 190325 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 2/1/2041 | 100000 | 87027 |
|  ONEOK, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 7/13/2047 | 150000 | 113713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.15%, 1/15/2051 | 100000 | 93782 |
|  Plains All American Pipeline LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 6/1/2042 | 100000 | 75511 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 6/15/2044 | 100000 | 70563 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Spectra Energy Partners LP |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 9/25/2043 | 100000 | $| 92381 |
|  Suncor Energy, Inc. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 6/15/2038 | 100000 |  | 98276 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/4/2051 | 115000 |  | 78308 |
|  Targa Resources Corp. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 7/1/2052 | 100000 |  | 89367 |
|  Valero Energy Corp. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 12/1/2051 | 50000 |  | 33170 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/1/2052 | 100000 |  | 70685 |
|  Williams Cos., Inc. (The) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.30%, 4/15/2040 | 100000 |  | 96347 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 3/1/2048 | 35000 |  | 27936 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 10/15/2051 | 100000 |  | 64018 |
|  |  |  | **5197945** |
| **Pharmaceuticals – 1.5%** | **Pharmaceuticals – 1.5%** | **Pharmaceuticals – 1.5%** | **Pharmaceuticals – 1.5%** |
|  Bristol-Myers Squibb Co. | Bristol-Myers Squibb Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 3/15/2062 | 100000 |  | 73044 |
|  Johnson & Johnson | Johnson & Johnson |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.85%, 7/15/2038 | 150000 |  | 157415 |
|  Merck & Co., Inc. | Merck & Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 12/10/2051 | 100000 |  | 63529 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 12/10/2061 | 100000 |  | 60787 |
|  Royalty Pharma plc | Royalty Pharma plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/2/2050 | 50000 |  | 30538 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 9/2/2051 | 100000 |  | 58792 |
|  Zoetis, Inc. | Zoetis, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 8/20/2048 | 100000 |  | 81049 |
|  |  |  | **525154** |
| **Professional Services – 0.2%** | **Professional Services – 0.2%** | **Professional Services – 0.2%** | **Professional Services – 0.2%** |
|  Equifax, Inc. | Equifax, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 7/1/2037 | 50000 |  | 50156 |
|  Verisk Analytics, Inc. | Verisk Analytics, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 5/15/2050 | 50000 |  | 32836 |
|  |  |  | **82992** |
| **Road & Rail – 3.2%** | **Road & Rail – 3.2%** | **Road & Rail – 3.2%** | **Road & Rail – 3.2%** |
|  Burlington Northern Santa Fe LLC | Burlington Northern Santa Fe LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/1/2040 | 100000 |  | 99068 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 9/1/2043 | 200000 |  | 184226 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 4/1/2044 | 300000 |  | 266764 |

---

*See Accompanying Notes to the Financial Statements.* 

414 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  Canadian Pacific Railway Co. | Canadian Pacific Railway Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 9/15/2115 | 100000 | $| 90552 |
|  CSX Corp. | CSX Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/1/2054 | 50000 |  | 39845 |
|  Kansas City Southern | Kansas City Southern |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 11/15/2069 | 50000 |  | 34347 |
|  Norfolk Southern Corp. | Norfolk Southern Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.16%, 5/15/2055 | 50000 |  | 30613 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.10%, 8/1/2118 | 50000 |  | 38646 |
|  Union Pacific Corp. | Union Pacific Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.84%, 3/20/2060 | 200000 |  | 142890 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 9/15/2067 | 200000 |  | 144744 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/5/2070 | 100000 |  | 66821 |
|  |  |  | **1138516** |
| **Semiconductors & Semiconductor Equipment – 3.3%** | **Semiconductors & Semiconductor Equipment – 3.3%** | **Semiconductors & Semiconductor Equipment – 3.3%** | **Semiconductors & Semiconductor Equipment – 3.3%** |
|  Broadcom, Inc. | Broadcom, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.42%, 4/15/2033(b) | 150000 |  | 113978 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.47%, 4/15/2034(b) | 200000 |  | 149701 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.14%, 11/15/2035(b) | 200000 |  | 138735 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.19%, 11/15/2036(b) | 110000 |  | 75027 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/15/2041(b) | 290000 |  | 191125 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2051(b) | 100000 |  | 64093 |
|  Intel Corp. | Intel Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 3/25/2060 | 50000 |  | 40488 |
|  KLA Corp. | KLA Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2062 | 100000 |  | 88246 |
|  Micron Technology, Inc. | Micron Technology, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.37%, 11/1/2041 | 100000 |  | 63388 |
|  NXP BV | NXP BV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 11/30/2051 | 100000 |  | 57863 |
|  Texas Instruments, Inc. | Texas Instruments, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 5/15/2048 | 35000 |  | 28753 |
|  TSMC Arizona Corp. | TSMC Arizona Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/22/2052 | 200000 |  | 165529 |
|  |  |  | **1176926** |
| **Software – 3.2%** | **Software – 3.2%** | **Software – 3.2%** | **Software – 3.2%** |
|  Microsoft Corp. | Microsoft Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.53%, 6/1/2050 | 100000 |  | 62733 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.92%, 3/17/2052 | 100000 |  | 67565 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/6/2057 | 100000 |  | 87906 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.04%, 3/17/2062 | 269000 |  | 175301 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Oracle Corp. | Oracle Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 7/8/2039 | 105000 | $| 96303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 3/25/2041 | 300000 |  | 203160 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 5/15/2045 | 225000 |  | 154419 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 4/1/2050 | 200000 |  | 123105 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/15/2055 | 115000 |  | 78014 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 4/1/2060 | 125000 |  | 75486 |
|  |  |  | **1123992** |
| **Specialty Retail – 2.6%** | **Specialty Retail – 2.6%** | **Specialty Retail – 2.6%** | **Specialty Retail – 2.6%** |
|  Dick's Sporting Goods, Inc. | Dick's Sporting Goods, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 1/15/2052 | 100000 |  | 60973 |
|  Home Depot, Inc. (The) | Home Depot, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/6/2048 | 200000 |  | 169404 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 9/15/2051 | 100000 |  | 60827 |
|  Lowe's Cos., Inc. | Lowe's Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 9/15/2041 | 220000 |  | 140059 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 5/3/2047 | 100000 |  | 73428 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 4/5/2049 | 150000 |  | 117113 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/15/2050 | 100000 |  | 85391 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 4/1/2052 | 200000 |  | 148503 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 4/1/2062 | 100000 |  | 72636 |
|  |  |  | **928334** |
| **Technology Hardware, Storage & Peripherals – 2.3%** | **Technology Hardware, Storage & Peripherals – 2.3%** | **Technology Hardware, Storage & Peripherals – 2.3%** | **Technology Hardware, Storage & Peripherals – 2.3%** |
|  Apple, Inc. | Apple, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/13/2045 | 100000 |  | 87210 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 2/23/2046 | 190000 |  | 171635 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 9/11/2049 | 100000 |  | 67339 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 2/8/2051 | 100000 |  | 62320 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 8/5/2051 | 200000 |  | 125674 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 8/20/2060 | 100000 |  | 57569 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 2/8/2061 | 100000 |  | 59299 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 8/5/2061 | 100000 |  | 59914 |
|  Hewlett Packard Enterprise Co. | Hewlett Packard Enterprise Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.35%, 10/15/2045(c) | 50000 |  | 45218 |
|  HP, Inc. | HP, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/15/2041 | 100000 |  | 88611 |
|  |  |  | **824789** |
| **Tobacco – 4.3%** | **Tobacco – 4.3%** | **Tobacco – 4.3%** | **Tobacco – 4.3%** |
|  Altria Group, Inc. | Altria Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.80%, 2/14/2039 | 300000 |  | 256333 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 8/9/2042 | 140000 |  | 95278 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 415

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##### [**Table of Contents**](#toc)

------

FlexShares® Credit-Scored US Long Corporate Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Tobacco – (continued)** | **Tobacco – (continued)** | **Tobacco – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/2/2043 | 100000 | $68429 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/31/2044 | 225000 | 179954 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 2/14/2049 | 250000 | 204187 |
|  BAT Capital Corp. | BAT Capital Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.73%, 9/25/2040 | 490000 | 308494 |
|  Philip Morris International, Inc. | Philip Morris International, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/16/2038 | 50000 | 46582 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/4/2043 | 330000 | 225614 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 11/10/2044 | 200000 | 138688 |
|  |  | **1523559** |
| **Trading Companies & Distributors – 0.2%** | **Trading Companies & Distributors – 0.2%** | **Trading Companies & Distributors – 0.2%** |
|  WW Grainger, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 6/15/2045 | 100000 | 86502 |
| **Water Utilities – 0.4%** | **Water Utilities – 0.4%** | **Water Utilities – 0.4%** |
|  Essential Utilities, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 4/15/2050 | 200000 | 125392 |
| **Wireless Telecommunication Services – 0.1%** | **Wireless Telecommunication Services – 0.1%** | **Wireless Telecommunication Services – 0.1%** |
|  Rogers Communications, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 3/15/2052(b) | 50000 | 38628 |
| **Total Corporate Bonds <br>(Cost $47,766,420)** | **Total Corporate Bonds <br>(Cost $47,766,420)** | **34694439** |
| **Total Investments – 97.7% <br>(Cost $47,766,420)** | **Total Investments – 97.7% <br>(Cost $47,766,420)** | **34694439** |
|  Other assets less liabilities – 2.3% | Other assets less liabilities – 2.3% | 803295 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**35497734** |

---

*<sup>(a)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(c)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $— |
|  Aggregate gross unrealized depreciation | (13160445) |
|  Net unrealized depreciation | $(13160445) |
|  Federal income tax cost | $47854884 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 97.7% |
|  Others<sup>(1)</sup> | 2.3 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

416 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 97.0%** | **CORPORATE BONDS – 97.0%** | **CORPORATE BONDS – 97.0%** |
| **Aerospace & Defense – 2.4%** | **Aerospace & Defense – 2.4%** | **Aerospace & Defense – 2.4%** |
|  Bombardier, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 6/15/2026(a) | $1725000 | $1632829 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2028(a) | 1650000 | 1468335 |
|  F-Brasile SpA | F-Brasile SpA |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series NR, 7.38%, 8/15/2026(a) | 1650000 | 1303500 |
|  Howmet Aerospace, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 2/1/2037 | 225000 | 206113 |
|  Maxar Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 6/15/2027(a) | 900000 | 882315 |
|  Rolls-Royce plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 10/14/2025(a) | 1285000 | 1130414 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/15/2027(a) | 970000 | 877821 |
|  Spirit AeroSystems, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2025(a) | 1620000 | 1573895 |
|  TransDigm UK Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/15/2026 | 645000 | 629529 |
|  TransDigm, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2026 | 1460000 | 1408900 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 3/15/2027 | 800000 | 788304 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/15/2027 | 3885000 | 3543897 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/15/2029 | 2585000 | 2201205 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/1/2029 | 1650000 | 1402921 |
|  Triumph Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 9/15/2024(a) | 800000 | 739584 |
|  Wesco Aircraft Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 11/15/2024(a) | 2320000 | 1206400 |
|  |  | **20995962** |
| **Air Freight & Logistics – 0.0%(b)** | **Air Freight & Logistics – 0.0%(b)** | **Air Freight & Logistics – 0.0%(b)** |
|  Western Global Airlines LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.38%, 8/15/2025(a) | 460000 | 386400 |
| **Airlines – 0.6%** | **Airlines – 0.6%** | **Airlines – 0.6%** |
|  Allegiant Travel Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 8/15/2027(a) | 1075000 | 1010547 |
|  American Airlines Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/1/2025(a) | 1077000 | 947609 |
|  American Airlines, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/20/2029(a) | 1230000 | 1119300 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Airlines – (continued)** | **Airlines – (continued)** | **Airlines – (continued)** | **Airlines – (continued)** | **Airlines – (continued)** |
|  Hawaiian Brand Intellectual Property Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/20/2026(a) | $| 1745000 | $| 1606567 |
|  United Airlines, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/15/2029(a) |  | 420000 |  | 359222 |
|  |  |  |  | **5043245** |
| **Auto Components – 1.8%** | **Auto Components – 1.8%** | **Auto Components – 1.8%** | **Auto Components – 1.8%** | **Auto Components – 1.8%** |
|  Allison Transmission, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/1/2027(a) |  | 480000 |  | 441902 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/1/2029(a) |  | 1000000 |  | 932500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 1/30/2031(a) |  | 585000 |  | 466687 |
|  American Axle & Manufacturing, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 7/1/2028 |  | 725000 |  | 669788 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2029 |  | 400000 |  | 324749 |
|  Clarios Global LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/15/2027(a) |  | 3740000 |  | 3665200 |
|  Dana Financing Luxembourg Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/15/2025(a) |  | 445000 |  | 432695 |
|  Dana, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/15/2027 |  | 340000 |  | 307700 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 6/15/2028 |  | 750000 |  | 678750 |
|  Dealer Tire LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 2/1/2028(a) |  | 725000 |  | 634084 |
|  Dornoch Debt Merger Sub, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 10/15/2029(a) |  | 1445000 |  | 983875 |
|  Icahn Enterprises LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/15/2027 |  | 850000 |  | 783182 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/1/2029 |  | 275000 |  | 229589 |
|  IHO Verwaltungs GmbH |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 9/15/2026(a) (c) |  | 385000 |  | 324215 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/15/2027(a) (c) |  | 565000 |  | 485194 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.37%, 5/15/2029(a) (c) |  | 1020000 |  | 870396 |
|  JB Poindexter & Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 4/15/2026(a) |  | 685000 |  | 652963 |
|  Patrick Industries, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 10/15/2027(a) |  | 635000 |  | 581769 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/1/2029(a) |  | 1370000 |  | 1034350 |
|  Real Hero Merger Sub 2, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/1/2029(a) |  | 1305000 |  | 935588 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 417

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** | **Auto Components – (continued)** |
|  Tenneco, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 1/15/2029(a) | $| 575000 | $| 568045 |
|  Wheel Pros, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/15/2029(a) |  | 795000 |  | 374201 |
|  |  |  |  | **16377422** |
| **Automobiles – 1.1%** | **Automobiles – 1.1%** | **Automobiles – 1.1%** | **Automobiles – 1.1%** | **Automobiles – 1.1%** |
|  Ford Motor Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 10/1/2028 |  | 535000 |  | 527743 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.63%, 4/22/2030 |  | 750000 |  | 837224 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.45%, 7/16/2031 |  | 1517000 |  | 1522355 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/12/2032 |  | 615000 |  | 461754 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.10%, 8/19/2032 |  | 350000 |  | 320357 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2043 |  | 1211000 |  | 843413 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.40%, 11/1/2046 |  | 115000 |  | 105888 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.29%, 12/8/2046 |  | 690000 |  | 510828 |
|  Jaguar Land Rover Automotive plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 10/15/2025(a) |  | 980000 |  | 904089 |
|  Mclaren Finance plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 8/1/2026(a) |  | 1215000 |  | 962924 |
|  PM General Purchaser LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 10/1/2028(a) |  | 1410000 |  | 1212195 |
|  Thor Industries, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/15/2029(a) |  | 1780000 |  | 1439628 |
|  Winnebago Industries, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 7/15/2028(a) |  | 305000 |  | 283819 |
|  |  |  |  | **9932217** |
| **Banks – 1.1%** | **Banks – 1.1%** | **Banks – 1.1%** | **Banks – 1.1%** | **Banks – 1.1%** |
|  Intesa Sanpaolo SpA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.71%, 1/15/2026(a) |  | 2085000 |  | 1942250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 6/1/2042(a) (d) |  | 100000 |  | 58523 |
|  Texas Capital Bancshares, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/6/2031(d) |  | 490000 |  | 424299 |
|  UniCredit SpA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.86%, 6/19/2032(a) (d) |  | 1400000 |  | 1159946 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.30%, 4/2/2034(a) (d) |  | 3475000 |  | 2948328 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.46%, 6/30/2035(a) (d) |  | 4835000 |  | 3602465 |
|  |  |  |  | **10135811** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Beverages – 0.1%** | **Beverages – 0.1%** | **Beverages – 0.1%** |
|  Triton Water Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/1/2029(a) | $1535000 | $1162574 |
| **Biotechnology – 0.1%** | **Biotechnology – 0.1%** | **Biotechnology – 0.1%** |
|  Emergent BioSolutions, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2028(a) | 1475000 | 884322 |
|  Grifols Escrow Issuer SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2028(a) | 210000 | 164062 |
|  |  | **1048384** |
| **Building Products – 1.7%** | **Building Products – 1.7%** | **Building Products – 1.7%** |
|  Builders FirstSource, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2032(a) | 545000 | 436109 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2032(a) | 485000 | 446054 |
|  Camelot Return Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 8/1/2028(a) | 1545000 | 1286212 |
|  Cornerstone Building Brands, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 1/15/2029(a) | 1885000 | 1178125 |
|  CP Atlas Buyer, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 12/1/2028(a) | 1109000 | 798480 |
|  Eco Material Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 1/31/2027(a) | 855000 | 799049 |
|  James Hardie International Finance DAC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/15/2028(a) | 305000 | 275832 |
|  JELD-WEN, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2025(a) | 205000 | 191675 |
|  Masonite International Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 2/1/2028(a) | 630000 | 576740 |
|  MIWD Holdco II LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/1/2030(a) | 1090000 | 840750 |
|  New Enterprise Stone & Lime Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2028(a) | 1160000 | 1009200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 7/15/2028(a) | 1055000 | 905520 |
|  Oscar Acquisition Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 4/15/2030(a) | 1290000 | 1092391 |
|  PGT Innovations, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 10/1/2029(a) | 300000 | 248805 |
|  Smyrna Ready Mix Concrete LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2028(a) | 2300000 | 1932000 |
|  Standard Industries, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/15/2027(a) | 275000 | 248875 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2028(a) | 520000 | 455650 |

---

*See Accompanying Notes to the Financial Statements.* 

418 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 7/15/2030(a) | $| 1105000 | $| 893448 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 1/15/2031(a) |  | 720000 |  | 538704 |
|  Victors Merger Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/15/2029(a) |  | 1880000 |  | 966451 |
|  |  |  |  | **15120070** |
| **Capital Markets – 0.5%** | **Capital Markets – 0.5%** | **Capital Markets – 0.5%** | **Capital Markets – 0.5%** | **Capital Markets – 0.5%** |
|  Advisor Group Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 8/1/2027(a) |  | 465000 |  | 458316 |
|  AG Issuer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 3/1/2028(a) |  | 300000 |  | 279098 |
|  AG TTMT Escrow Issuer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 9/30/2027(a) |  | 405000 |  | 406519 |
|  Aretec Escrow Issuer, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/1/2029(a) |  | 870000 |  | 713400 |
|  Brightsphere Investment Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 7/27/2026 |  | 185000 |  | 165575 |
|  Compass Group Diversified Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2029(a) |  | 1450000 |  | 1247000 |
|  Hightower Holding LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 4/15/2029(a) |  | 655000 |  | 533254 |
|  Jane Street Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/15/2029(a) |  | 120000 |  | 106063 |
|  Nomura Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 1/16/2025 |  | 140000 |  | 131046 |
|  StoneX Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 6/15/2025(a) |  | 350000 |  | 345625 |
|  |  |  |  | **4385896** |
| **Chemicals – 4.2%** | **Chemicals – 4.2%** | **Chemicals – 4.2%** | **Chemicals – 4.2%** | **Chemicals – 4.2%** |
|  Ashland LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 9/1/2031(a) |  | 310000 |  | 242538 |
|  ASP Unifrax Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 9/30/2028(a) |  | 1610000 |  | 1279549 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/30/2029(a) |  | 970000 |  | 649900 |
|  Axalta Coating Systems LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/15/2027(a) |  | 845000 |  | 769984 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/15/2029(a) |  | 150000 |  | 123281 |
|  Cerdia Finanz GmbH |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 2/15/2027(a) |  | 1225000 |  | 991690 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Cheever Escrow Issuer LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 10/1/2027(a) | $210000 | $192780 |
|  Chemours Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 11/15/2028(a) | 1810000 | 1537595 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/15/2029(a) | 2095000 | 1634100 |
|  Cornerstone Chemical Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 8/15/2024(a) | 170000 | 127819 |
|  CVR Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 6/15/2028(a) | 715000 | 646903 |
|  Diamond BC BV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 10/1/2029(a) | 215000 | 157941 |
|  FXI Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 11/1/2024(a) | 700000 | 600586 |
| &nbsp;&nbsp;&nbsp;&nbsp; 12.25%, 11/15/2026(a) | 1665000 | 1443888 |
|  Gates Global LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2026(a) | 1090000 | 1046400 |
|  GPD Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.13%, 4/1/2026(a) | 550000 | 491721 |
|  Herens Holdco Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2028(a) | 375000 | 307214 |
|  Illuminate Buyer LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 7/1/2028(a) | 1010000 | 852995 |
|  INEOS Quattro Finance 2 plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 1/15/2026(a) | 415000 | 350974 |
|  Innophos Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.38%, 2/15/2028(a) | 565000 | 537914 |
|  Iris Holding, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.00%, 12/15/2028(a) | 750000 | 637500 |
|  LSF11 A5 HoldCo LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 10/15/2029(a) | 760000 | 599070 |
|  Mativ Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 10/1/2026(a) | 770000 | 705557 |
|  Methanex Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 10/15/2027 | 1475000 | 1345200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/15/2029 | 2461000 | 2106028 |
|  Minerals Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2028(a) | 805000 | 699344 |
|  NOVA Chemicals Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 5/15/2029(a) | 1185000 | 966408 |
|  Olympus Water US Holding Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 10/1/2028(a) | 1220000 | 990412 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 10/1/2029(a) | 940000 | 650908 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 419

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Polar US Borrower LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/15/2026(a) | $| 695000 | $| 331774 |
|  Rain CII Carbon LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 4/1/2025(a) |  | 1070000 |  | 917525 |
|  SCIH Salt Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/1/2028(a) |  | 1190000 |  | 1032914 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/1/2029(a) |  | 1500000 |  | 1203966 |
|  SCIL IV LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/1/2026(a) |  | 970000 |  | 771082 |
|  SK Invictus Intermediate II Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/30/2029(a) |  | 1410000 |  | 1153197 |
|  Trinseo Materials Operating SCA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 9/1/2025(a) |  | 1614000 |  | 1248832 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/1/2029(a) |  | 1615000 |  | 916513 |
|  Tronox, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/15/2029(a) |  | 3865000 |  | 2984904 |
|  Valvoline, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 6/15/2031(a) |  | 200000 |  | 157800 |
|  Vibrantz Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 2/15/2030(a) |  | 1645000 |  | 1083888 |
|  WR Grace Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/15/2027(a) |  | 780000 |  | 682500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 8/15/2029(a) |  | 2500000 |  | 1932450 |
|  |  |  |  | **37103544** |
| **Commercial Services & Supplies – 3.2%** | **Commercial Services & Supplies – 3.2%** | **Commercial Services & Supplies – 3.2%** | **Commercial Services & Supplies – 3.2%** | **Commercial Services & Supplies – 3.2%** |
|  ACCO Brands Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 3/15/2029(a) |  | 525000 |  | 417113 |
|  Allied Universal Holdco LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 7/15/2026(a) |  | 2150000 |  | 2053336 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 7/15/2027(a) |  | 2265000 |  | 1969213 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/1/2028(a) |  | 2835000 |  | 2350908 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2029(a) |  | 2040000 |  | 1416367 |
|  Aptim Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 6/15/2025(a) |  | 1160000 |  | 796804 |
|  Aramark Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/1/2025(a) |  | 2080000 |  | 2057656 |
|  CoreCivic, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2027 |  | 520000 |  | 431476 |
|  Covanta Holding Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/1/2029(a) |  | 190000 |  | 161775 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/1/2030 |  | 755000 |  | 628783 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** |
|  Deluxe Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 6/1/2029(a) | $| 1815000 | $| 1513165 |
|  Garda World Security Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/15/2027(a) |  | 840000 |  | 746013 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 11/1/2027(a) |  | 1185000 |  | 1069462 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2029(a) |  | 1090000 |  | 849459 |
|  GEO Group, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 6/30/2028 |  | 280000 |  | 280000 |
|  GFL Environmental, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2028(a) |  | 1080000 |  | 934632 |
|  IAA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 6/15/2027(a) |  | 620000 |  | 580194 |
|  Interface, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/1/2028(a) |  | 645000 |  | 508944 |
|  Intrado Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/15/2025(a) |  | 1480000 |  | 1293912 |
|  Legends Hospitality Holding Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2026(a) |  | 560000 |  | 490000 |
|  Madison IAQ LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 6/30/2028(a) |  | 315000 |  | 260663 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/30/2029(a) |  | 2300000 |  | 1575500 |
|  Pitney Bowes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/15/2024 |  | 345000 |  | 315331 |
|  Prime Security Services Borrower LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2028(a) |  | 2830000 |  | 2600728 |
|  Stericycle, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 7/15/2024(a) |  | 755000 |  | 743675 |
|  Vericast Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 9/15/2026(a) |  | 1335000 |  | 1309969 |
|  WASH Multifamily Acquisition, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/15/2026(a) |  | 805000 |  | 750637 |
|  Waste Pro USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/15/2026(a) |  | 560000 |  | 518230 |
|  |  |  |  | **28623945** |
| **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** | **Communications Equipment – 0.2%** |
|  CommScope, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 7/1/2028(a) |  | 1580000 |  | 1338146 |

---

*See Accompanying Notes to the Financial Statements.* 

420 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Construction & Engineering – 1.2%** | **Construction & Engineering – 1.2%** | **Construction & Engineering – 1.2%** |
|  Artera Services LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.03%, 12/4/2025(a) | $2205000 | $1842630 |
|  Brand Industrial Services, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 7/15/2025(a) | 2237000 | 1608327 |
|  Brundage-Bone Concrete Pumping Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2026(a) | 815000 | 737575 |
|  Global Infrastructure Solutions, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 6/1/2029(a) | 965000 | 713565 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2032(a) | 650000 | 481007 |
|  Great Lakes Dredge & Dock Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 6/1/2029(a) | 1140000 | 901471 |
|  HTA Group Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 12/18/2025(a) | 1030000 | 901250 |
|  Pike Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/1/2028(a) | 1595000 | 1361939 |
|  Promontoria Holding 264 BV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 3/1/2027(a) | 655000 | 596050 |
|  Railworks Holdings LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 11/15/2028(a) | 635000 | 583589 |
|  VM Consolidated, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2029(a) | 760000 | 663446 |
|  Weekley Homes LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 9/15/2028(a) | 580000 | 467166 |
|  |  | **10858015** |
| **Consumer Finance – 2.6%** | **Consumer Finance – 2.6%** | **Consumer Finance – 2.6%** |
|  Cobra Acquisition Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 11/1/2029(a) | 870000 | 578550 |
|  Credit Acceptance Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 12/31/2024(a) | 395000 | 367303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 3/15/2026 | 455000 | 430384 |
|  Enova International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 9/1/2024(a) | 610000 | 570443 |
|  FirstCash, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/1/2030(a) | 775000 | 683158 |
|  Ford Motor Credit Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.54%, 8/1/2026 | 960000 | 883488 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.27%, 1/9/2027 | 1145000 | 1033809 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 5/28/2027 | 2235000 | 2046053 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 8/17/2027 | 1695000 | 1505245 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.82%, 11/2/2027 | $| 1040000 | $| 893310 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 2/16/2028 |  | 960000 |  | 779312 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 2/10/2029 |  | 1035000 |  | 811377 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.11%, 5/3/2029 |  | 2242000 |  | 2004348 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/13/2030 |  | 1735000 |  | 1403233 |
|  goeasy Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/1/2026(a) |  | 340000 |  | 291550 |
|  LFS Topco LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 10/15/2026(a) |  | 430000 |  | 336011 |
|  OneMain Finance Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/15/2027 |  | 950000 |  | 778633 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 1/15/2028 |  | 1570000 |  | 1426235 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/15/2028 |  | 1355000 |  | 1055139 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/15/2029 |  | 1615000 |  | 1324300 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/15/2030 |  | 500000 |  | 377500 |
|  PRA Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 9/1/2025(a) |  | 395000 |  | 377835 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2029(a) |  | 1360000 |  | 1090040 |
|  PROG Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/15/2029(a) |  | 2200000 |  | 1795860 |
|  World Acceptance Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/1/2026(a) |  | 960000 |  | 600595 |
|  |  |  |  | **23443711** |
| **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** |
|  Cascades, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 1/15/2026(a) |  | 190000 |  | 170635 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2028(a) |  | 640000 |  | 547360 |
|  Clydesdale Acquisition Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 4/15/2029(a) |  | 990000 |  | 939906 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/15/2030(a) |  | 4025000 |  | 3536969 |
|  Graham Packaging Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 8/15/2028(a) |  | 1500000 |  | 1229420 |
|  Intelligent Packaging Ltd. Finco, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/15/2028(a) |  | 1010000 |  | 751378 |
|  LABL, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 7/15/2026(a) |  | 945000 |  | 897750 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/1/2028(a) |  | 1230000 |  | 1068452 |
|  Mauser Packaging Solutions Holding Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 4/15/2025(a) |  | 1490000 |  | 1341145 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 421

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** |
|  Owens-Brockway Glass Container, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2025(a) | $| 345000 | $| 326025 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 8/15/2025(a) |  | 675000 |  | 629438 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/13/2027(a) |  | 805000 |  | 768762 |
|  Pactiv LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.95%, 12/15/2025 |  | 275000 |  | 255288 |
|  Sealed Air Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 7/15/2033(a) |  | 150000 |  | 143668 |
|  Trident TPI Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 8/1/2024(a) |  | 365000 |  | 340432 |
|  Trivium Packaging Finance BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/15/2026(a) (e) |  | 420000 |  | 386274 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 8/15/2027(a) (e) |  | 950000 |  | 893201 |
|  |  |  |  | **14226103** |
| **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** | **Distributors – 0.1%** |
|  American Builders & Contractors Supply Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/15/2028(a) |  | 195000 |  | 172066 |
|  BCPE Empire Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 5/1/2027(a) |  | 960000 |  | 876910 |
|  |  |  |  | **1048976** |
| **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** |
|  Adtalem Global Education, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2028(a) |  | 635000 |  | 579438 |
|  Grand Canyon University |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 10/1/2024 |  | 830000 |  | 778125 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 10/1/2028 |  | 695000 |  | 621156 |
|  Metis Merger Sub LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/15/2029(a) |  | 1045000 |  | 838633 |
|  Service Corp. International |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 8/15/2030 |  | 395000 |  | 318854 |
|  Signal Parent, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2029(a) |  | 655000 |  | 282043 |
|  StoneMor, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/15/2029(a) |  | 860000 |  | 725625 |
|  WW International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/15/2029(a) |  | 1795000 |  | 986805 |
|  |  |  |  | **5130679** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** |
|  Armor Holdco, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 11/15/2029(a) | $760000 | $566686 |
|  CPI CG, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 3/15/2026(a) | 336000 | 316887 |
|  Jefferies Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/15/2028(a) | 2070000 | 1625012 |
|  Jefferson Capital Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/15/2026(a) | 450000 | 374558 |
|  Midcap Financial Issuer Trust |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/1/2028(a) | 1435000 | 1219567 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/15/2030(a) | 900000 | 693000 |
|  MPH Acquisition Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 11/1/2028(a) | 1805000 | 1394363 |
|  Oxford Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 2/1/2027(a) | 335000 | 306525 |
|  Sabre GLBL, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 4/15/2025(a) | 1375000 | 1331543 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 9/1/2025(a) | 1700000 | 1595756 |
|  |  | **9423897** |
| **Diversified Telecommunication Services – 7.0%** | **Diversified Telecommunication Services – 7.0%** | **Diversified Telecommunication Services – 7.0%** |
|  Altice France Holding SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 5/15/2027(a) | 3430000 | 2672896 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2028(a) | 2565000 | 1658711 |
|  Altice France SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) | 1525000 | 1204750 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 1/15/2029(a) | 980000 | 737450 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 7/15/2029(a) | 5590000 | 4210248 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/15/2029(a) | 4550000 | 3469375 |
|  CCO Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/1/2027(a) | 1245000 | 1153467 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2028(a) | 565000 | 511325 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/1/2029(a) | 205000 | 183143 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 9/1/2029(a) | 160000 | 147438 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/1/2030(a) | 1135000 | 953854 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/15/2030(a) | 895000 | 726346 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2031(a) | 1975000 | 1560250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/1/2032(a) | 635000 | 508030 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2032 | 1897000 | 1498630 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2033(a) | 1010000 | 765894 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 1/15/2034(a) | 1225000 | 900375 |
|  Frontier Communications Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2028(a) | 230000 | 201250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/1/2029(a) | 3830000 | 3154963 |

---

*See Accompanying Notes to the Financial Statements.* 

422 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/1/2029 | $| 2737000 | $| 2132164 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2030(a) |  | 3600000 |  | 2815200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 5/15/2030(a) |  | 130000 |  | 132762 |
|  Iliad Holding SASU |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/15/2026(a) |  | 1595000 |  | 1477162 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 10/15/2028(a) |  | 1855000 |  | 1678775 |
|  Intelsat Jackson Holdings SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 3/15/2030(a) |  | 4165000 |  | 3822471 |
|  Level 3 Financing, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/1/2028(a) |  | 2760000 |  | 2277000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 1/15/2029(a) |  | 410000 |  | 312625 |
|  Lumen Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 12/15/2026(a) |  | 1660000 |  | 1421375 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/15/2027(a) |  | 1740000 |  | 1479348 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series G, 6.88%, 1/15/2028 |  | 1410000 |  | 1191450 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/15/2029(a) |  | 3625000 |  | 2555453 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/15/2029(a) |  | 1870000 |  | 1373309 |
|  Sprint Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 3/15/2032 |  | 690000 |  | 809812 |
|  Telecom Italia Capital SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 11/15/2033 |  | 245000 |  | 188258 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/30/2034 |  | 240000 |  | 175135 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.20%, 7/18/2036 |  | 525000 |  | 408849 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.72%, 6/4/2038 |  | 540000 |  | 429300 |
|  Virgin Media Finance plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/15/2030(a) |  | 2925000 |  | 2344059 |
|  Virgin Media Secured Finance plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/15/2029(a) |  | 1785000 |  | 1622065 |
|  Windstream Escrow LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 8/15/2028(a) |  | 3046000 |  | 2635704 |
|  Zayo Group Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2027(a) |  | 2140000 |  | 1653150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 3/1/2028(a) |  | 3915000 |  | 2603475 |
|  |  |  |  | **61757296** |
| **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** | **Electric Utilities – 1.5%** |
|  DPL, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 7/1/2025 |  | 495000 |  | 467290 |
|  Drax Finco plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 11/1/2025(a) |  | 430000 |  | 399900 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Emera, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 16-A, 6.75%, 6/15/2076(d) | $| 2515000 | $| 2344287 |
|  FirstEnergy Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 3/1/2025 |  | 225000 |  | 206831 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, 1.60%, 1/15/2026 |  | 335000 |  | 291340 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 4.40%, 7/15/2027(e) |  | 200000 |  | 187822 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 5.35%, 7/15/2047(e) |  | 225000 |  | 185643 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 3.40%, 3/1/2050 |  | 340000 |  | 211225 |
|  Leeward Renewable Energy Operations LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/1/2029(a) |  | 445000 |  | 360450 |
|  NextEra Energy Operating Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 10/15/2026(a) |  | 625000 |  | 579344 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/15/2027(a) |  | 550000 |  | 511500 |
|  NRG Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2028 |  | 1350000 |  | 1287562 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 6/15/2029(a) |  | 995000 |  | 902962 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 2/15/2031(a) |  | 505000 |  | 401864 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2032(a) |  | 755000 |  | 595280 |
|  PG&E Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/1/2028 |  | 2050000 |  | 1847655 |
|  Vistra Operations Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2027(a) |  | 1760000 |  | 1677773 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/1/2029(a) |  | 785000 |  | 671391 |
|  |  |  |  | **13130119** |
| **Electronic Equipment, Instruments & Components – 0.1%** | **Electronic Equipment, Instruments & Components – 0.1%** | **Electronic Equipment, Instruments & Components – 0.1%** | **Electronic Equipment, Instruments & Components – 0.1%** | **Electronic Equipment, Instruments & Components – 0.1%** |
|  Likewize Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 10/15/2025(a) |  | 585000 |  | 529281 |
| **Energy Equipment & Services – 2.4%** | **Energy Equipment & Services – 2.4%** | **Energy Equipment & Services – 2.4%** | **Energy Equipment & Services – 2.4%** | **Energy Equipment & Services – 2.4%** |
|  Archrock Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/1/2027(a) |  | 995000 |  | 947737 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/1/2028(a) |  | 2770000 |  | 2575823 |
|  Bristow Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 3/1/2028(a) |  | 1325000 |  | 1226446 |
|  CGG SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/1/2027(a) |  | 1759000 |  | 1555273 |
|  Enerflex Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 10/15/2027(a) |  | 1200000 |  | 1167360 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 423

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** |
|  Oceaneering International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2028 | $| 1050000 | $| 936799 |
|  Precision Drilling Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 1/15/2026(a) |  | 390000 |  | 383140 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 1/15/2029(a) |  | 965000 |  | 887443 |
|  Solaris Midstream Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 4/1/2026(a) |  | 415000 |  | 395288 |
|  Transocean Guardian Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 1/15/2024(a) |  | 545508 |  | 530272 |
|  Transocean Pontus Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 8/1/2025(a) |  | 400400 |  | 385421 |
|  Transocean Proteus Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 12/1/2024(a) |  | 339750 |  | 331256 |
|  USA Compression Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/1/2026 |  | 1370000 |  | 1315022 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 9/1/2027 |  | 2575000 |  | 2459125 |
|  Valaris Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 4/30/2028(a) (c) |  | 415000 |  | 408256 |
|  Weatherford International Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 12/1/2024(a) |  | 208000 |  | 213783 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 4/30/2030(a) |  | 5410000 |  | 5098925 |
|  Welltec International ApS |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 10/15/2026(a) |  | 605000 |  | 586390 |
|  |  |  |  | **21403759** |
| **Entertainment – 0.5%** | **Entertainment – 0.5%** | **Entertainment – 0.5%** | **Entertainment – 0.5%** | **Entertainment – 0.5%** |
|  Allen Media LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 2/15/2028(a) |  | 1415000 |  | 573429 |
|  Cinemark USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 3/15/2026(a) |  | 1346000 |  | 1133076 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2028(a) |  | 2819000 |  | 2140143 |
|  WMG Acquisition Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 12/1/2029(a) |  | 500000 |  | 416250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/15/2031(a) |  | 240000 |  | 187293 |
|  |  |  |  | **4450191** |
| **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** | **Equity Real Estate Investment Trusts (REITs) – 2.4%** |
|  Brookfield Property REIT, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/15/2026(a) |  | 1350000 |  | 1253057 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2027(a) |  | 1460000 |  | 1242226 |
|  Diversified Healthcare Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/1/2024 |  | 365000 |  | 312747 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 6/15/2025 |  | 945000 |  | 890927 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Global Net Lease, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 12/15/2027(a) | $| 1000000 | $| 808100 |
|  HAT Holdings I LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 6/15/2026(a) |  | 1330000 |  | 1081316 |
|  Iron Mountain, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 7/15/2032(a) |  | 224000 |  | 192051 |
|  MPT Operating Partnership LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/1/2026 |  | 1100000 |  | 992112 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/15/2027 |  | 3100000 |  | 2652918 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 8/1/2029 |  | 3300000 |  | 2614359 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/15/2031 |  | 490000 |  | 336710 |
|  SBA Communications Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 2/1/2029 |  | 1000000 |  | 808230 |
|  Service Properties Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/15/2025 |  | 505000 |  | 446925 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 2/15/2026 |  | 675000 |  | 583875 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/1/2026 |  | 980000 |  | 796507 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 2/15/2027 |  | 1030000 |  | 833847 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 1/15/2028 |  | 290000 |  | 213157 |
|  Uniti Group LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/15/2028(a) |  | 1230000 |  | 1005458 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2029(a) |  | 4025000 |  | 2887938 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2030(a) |  | 2541000 |  | 1734055 |
|  |  |  |  | **21686515** |
| **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** | **Food & Staples Retailing – 0.1%** |
|  C&S Group Enterprises LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/15/2028(a) |  | 820000 |  | 606177 |
| **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** |
|  B&G Foods, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/1/2025 |  | 1935000 |  | 1758470 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 9/15/2027 |  | 2035000 |  | 1707100 |
|  Post Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/15/2028(a) |  | 1310000 |  | 1224719 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/15/2029(a) |  | 1760000 |  | 1583859 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/15/2030(a) |  | 863000 |  | 728213 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/15/2031(a) |  | 730000 |  | 603856 |
|  Sigma Holdco BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/15/2026(a) |  | 390000 |  | 238980 |
|  Simmons Foods, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/1/2029(a) |  | 425000 |  | 354634 |
|  |  |  |  | **8199831** |

---

*See Accompanying Notes to the Financial Statements.* 

424 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** |
|  AmeriGas Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 5/20/2024 | $1015000 | $991841 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/20/2025 | 1620000 | 1551490 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 8/20/2026 | 1345000 | 1258250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/20/2027 | 1185000 | 1092784 |
|  Suburban Propane Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 3/1/2027 | 585000 | 552823 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2031(a) | 110000 | 92469 |
|  Superior Plus LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/15/2029(a) | 1995000 | 1691024 |
|  |  | **7230681** |
| **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** |
|  Garden Spinco Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 7/20/2030(a) | 745000 | 766273 |
|  Hologic, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/1/2028(a) | 500000 | 467500 |
|  Medline Borrower LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/1/2029(a) | 3055000 | 2495935 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 10/1/2029(a) | 3580000 | 2787925 |
|  Varex Imaging Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 10/15/2027(a) | 494000 | 482125 |
|  |  | **6999758** |
| **Health Care Providers & Services – 2.1%** | **Health Care Providers & Services – 2.1%** | **Health Care Providers & Services – 2.1%** |
|  AHP Health Partners, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 7/15/2029(a) | 1025000 | 784125 |
|  Air Methods Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 5/15/2025(a) | 265000 | 137170 |
|  DaVita, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/1/2030(a) | 2648000 | 2064447 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2031(a) | 770000 | 556733 |
|  Encompass Health Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2028 | 900000 | 805410 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/1/2030 | 380000 | 323950 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/1/2031 | 200000 | 165000 |
|  Envision Healthcare Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 10/15/2026(a) | 3775000 | 1132500 |
|  Global Medical Response, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2025(a) | 655000 | 520725 |
|  Hadrian Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/1/2026(a) | 55000 | 50050 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Legacy LifePoint Health LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 4/15/2025(a) | $| 440000 | $| 389400 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/15/2027(a) |  | 600000 |  | 473086 |
|  LifePoint Health, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2029(a) |  | 1115000 |  | 712329 |
|  ModivCare, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/15/2025(a) |  | 674000 |  | 640250 |
|  Molina Healthcare, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/15/2030(a) |  | 200000 |  | 169959 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 5/15/2032(a) |  | 400000 |  | 333600 |
|  Pediatrix Medical Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 2/15/2030(a) |  | 25000 |  | 21500 |
|  Prime Healthcare Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 11/1/2025(a) |  | 1005000 |  | 875918 |
|  Radiology Partners, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 2/1/2028(a) |  | 1545000 |  | 817305 |
|  RegionalCare Hospital Partners Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 12/1/2026(a) |  | 2970000 |  | 2367981 |
|  RP Escrow Issuer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/15/2025(a) |  | 895000 |  | 669227 |
|  Select Medical Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 8/15/2026(a) |  | 1655000 |  | 1577604 |
|  Surgery Center Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.00%, 4/15/2027(a) |  | 395000 |  | 383267 |
|  Team Health Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 2/1/2025(a) |  | 455000 |  | 343525 |
|  Tenet Healthcare Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 10/1/2028(a) |  | 1145000 |  | 990997 |
|  Toledo Hospital (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 5.33%, 11/15/2028 |  | 525000 |  | 346909 |
|  US Acute Care Solutions LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 3/1/2026(a) |  | 905000 |  | 820536 |
|  US Renal Care, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.63%, 7/15/2027(a) |  | 1098000 |  | 435913 |
|  |  |  |  | **18909416** |
| **Hotels, Restaurants & Leisure – 5.2%** | **Hotels, Restaurants & Leisure – 5.2%** | **Hotels, Restaurants & Leisure – 5.2%** | **Hotels, Restaurants & Leisure – 5.2%** | **Hotels, Restaurants & Leisure – 5.2%** |
|  1011778 BC ULC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 1/15/2028(a) |  | 300000 |  | 263677 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2028(a) |  | 1060000 |  | 929758 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/15/2030(a) |  | 1775000 |  | 1448844 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 425

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Affinity Gaming |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 12/15/2027(a) | $1230000 | $1026745 |
|  Boyne USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2029(a) | 195000 | 170625 |
|  Caesars Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 7/1/2027(a) | 2195000 | 2134638 |
|  Carnival Holdings Bermuda Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.38%, 5/1/2028(a) | 2775000 | 2809909 |
|  Carrols Restaurant Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 7/1/2029(a) | 660000 | 463650 |
|  CCM Merger, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/1/2026(a) | 190000 | 173307 |
|  CEC Entertainment LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/1/2026(a) | 705000 | 659433 |
|  Fertitta Entertainment LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/15/2029(a) | 425000 | 369622 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 1/15/2030(a) | 2700000 | 2119500 |
|  Full House Resorts, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/15/2028(a) | 1265000 | 1100550 |
|  Genting New York LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 2/15/2026(a) | 580000 | 508482 |
|  GPS Hospitality Holding Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 8/15/2028(a) | 870000 | 611175 |
|  Hilton Grand Vacations Borrower Escrow LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2029(a) | 1780000 | 1526581 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/1/2031(a) | 85000 | 69488 |
|  Jacobs Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/15/2029(a) | 720000 | 634802 |
|  Las Vegas Sands Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 8/18/2026 | 685000 | 598298 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 8/8/2029 | 205000 | 165699 |
|  Life Time, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2026(a) | 1405000 | 1306650 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/15/2026(a) | 1005000 | 876213 |
|  MajorDrive Holdings IV LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/1/2029(a) | 1195000 | 842117 |
|  Marriott Ownership Resorts, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2028 | 570000 | 492021 |
|  Merlin Entertainments Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/15/2026(a) | 350000 | 325463 |
|  MGM Resorts International |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2027 | 935000 | 861182 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Midwest Gaming Borrower LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/1/2029(a) | $1650000 | $1395302 |
|  Mohegan Gaming & Entertainment |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 2/1/2026(a) | 1790000 | 1509919 |
|  Motion Bondco DAC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 11/15/2027(a) | 590000 | 493582 |
|  Raptor Acquisition Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 11/1/2026(a) | 400000 | 353000 |
|  Resorts World Las Vegas LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/16/2029(a) | 3870000 | 2771110 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/6/2031(a) | 1100000 | 745627 |
|  Scientific Games Holdings LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 3/1/2030(a) | 2875000 | 2470718 |
|  SeaWorld Parks & Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/15/2029(a) | 1420000 | 1221404 |
|  Six Flags Entertainment Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2027(a) | 780000 | 702000 |
|  Sizzling Platter LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 11/28/2025(a) | 230000 | 200917 |
|  Speedway Motorsports LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 11/1/2027(a) | 250000 | 217218 |
|  TKC Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/15/2028(a) | 875000 | 726250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 5/15/2029(a) | 1525000 | 1082862 |
|  Travel + Leisure Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/1/2027(e) | 605000 | 564892 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/1/2030(a) | 35000 | 28252 |
|  Viking Cruises Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2025(a) | 270000 | 236250 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 9/15/2027(a) | 1765000 | 1394786 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 2/15/2029(a) | 1090000 | 864758 |
|  Viking Ocean Cruises Ship VII Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2029(a) | 760000 | 592443 |
|  VOC Escrow Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/15/2028(a) | 1130000 | 930261 |
|  Wynn Las Vegas LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2025(a) | 2710000 | 2564961 |
|  Wynn Resorts Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/15/2025(a) | 905000 | 882402 |
|  Yum! Brands, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2030(a) | 400000 | 357500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2031 | 570000 | 457425 |

---

*See Accompanying Notes to the Financial Statements.* 

426 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/31/2032 | $| 565000 | $| 483092 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 4/1/2032 |  | 555000 |  | 496431 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/15/2037 |  | 65000 |  | 63700 |
|  |  |  |  | **46295491** |
| **Household Durables – 2.3%** | **Household Durables – 2.3%** | **Household Durables – 2.3%** | **Household Durables – 2.3%** | **Household Durables – 2.3%** |
|  Adams Homes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 2/15/2025(a) |  | 210000 |  | 169899 |
|  Ashton Woods USA LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 1/15/2028(a) |  | 555000 |  | 471231 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 8/1/2029(a) |  | 755000 |  | 567194 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/1/2030(a) |  | 870000 |  | 645636 |
|  Beazer Homes USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 10/15/2029 |  | 1210000 |  | 1001275 |
|  Brookfield Residential Properties, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 9/15/2027(a) |  | 2065000 |  | 1801713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2029(a) |  | 1375000 |  | 1035691 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 2/15/2030(a) |  | 1860000 |  | 1430217 |
|  Century Communities, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 6/1/2027 |  | 740000 |  | 706404 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2029(a) |  | 225000 |  | 177196 |
|  Empire Communities Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 12/15/2025(a) |  | 930000 |  | 801680 |
|  Installed Building Products, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 2/1/2028(a) |  | 540000 |  | 477225 |
|  KB Home |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 6/15/2027 |  | 500000 |  | 483610 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 7/15/2030 |  | 630000 |  | 581962 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/15/2031 |  | 50000 |  | 37875 |
|  LGI Homes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/15/2029(a) |  | 645000 |  | 494592 |
|  M/I Homes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 2/1/2028 |  | 815000 |  | 699262 |
|  Mattamy Group Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/15/2027(a) |  | 380000 |  | 324691 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/1/2030(a) |  | 1525000 |  | 1189115 |
|  Meritage Homes Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2025 |  | 550000 |  | 534020 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 6/6/2027 |  | 470000 |  | 420839 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/15/2029(a) |  | 100000 |  | 80370 |
|  New Home Co., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 10/15/2025(a) |  | 1460000 |  | 1130794 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** |
|  Newell Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/1/2036(e) | $| 80000 | $| 66472 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/1/2046(e) |  | 291000 |  | 223925 |
|  Shea Homes LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2028(a) |  | 785000 |  | 662139 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/1/2029(a) |  | 385000 |  | 313860 |
|  SWF Escrow Issuer Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2029(a) |  | 1360000 |  | 782000 |
|  Taylor Morrison Communities, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/15/2027(a) |  | 735000 |  | 689246 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2028(a) |  | 930000 |  | 852415 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 8/1/2030(a) |  | 80000 |  | 66375 |
|  TopBuild Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2029(a) |  | 140000 |  | 111245 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 2/15/2032(a) |  | 150000 |  | 117446 |
|  Tri Pointe Homes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 6/1/2027 |  | 865000 |  | 743912 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.70%, 6/15/2028 |  | 880000 |  | 762414 |
|  |  |  |  | **20653940** |
| **Household Products – 0.5%** | **Household Products – 0.5%** | **Household Products – 0.5%** | **Household Products – 0.5%** | **Household Products – 0.5%** |
|  Central Garden & Pet Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 4/30/2031(a) |  | 300000 |  | 249000 |
|  Energizer Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 12/31/2027(a) |  | 700000 |  | 640465 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/15/2028(a) |  | 1375000 |  | 1141690 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 3/31/2029(a) |  | 1740000 |  | 1393027 |
|  Kronos Acquisition Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 12/31/2027(a) |  | 755000 |  | 634200 |
|  |  |  |  | **4058382** |
| **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** | **Independent Power and Renewable Electricity<br>Producers – 0.9%** |
|  Atlantica Sustainable Infrastructure plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 6/15/2028(a) |  | 435000 |  | 368662 |
|  Calpine Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 3/15/2028(a) |  | 3045000 |  | 2699740 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/1/2029(a) |  | 2270000 |  | 1907309 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2031(a) |  | 3015000 |  | 2547443 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/1/2031(a) |  | 350000 |  | 286746 |
|  |  |  |  | **7809900** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 427

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Insurance – 1.8%** | **Insurance – 1.8%** | **Insurance – 1.8%** |
|  Acrisure LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/15/2025(a) | $1075000 | $1010392 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.13%, 8/1/2026(a) | 375000 | 371626 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2029(a) | 290000 | 236817 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/1/2029(a) | 1090000 | 903637 |
|  Alliant Holdings Intermediate LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/15/2027(a) | 1410000 | 1286625 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/1/2029(a) | 925000 | 779340 |
|  AmWINS Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/30/2029(a) | 345000 | 294920 |
|  AssuredPartners, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/15/2029(a) | 1285000 | 1056913 |
|  BroadStreet Partners, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/15/2029(a) | 1605000 | 1288131 |
|  Enstar Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 9/1/2040(d) | 765000 | 678082 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2042(d) | 1025000 | 805384 |
|  Global Atlantic Fin Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 10/15/2051(a) (d) | 1385000 | 1020184 |
|  GTCR AP Finance, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 5/15/2027(a) | 540000 | 514449 |
|  HUB International Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 12/1/2029(a) | 1125000 | 964676 |
|  Liberty Mutual Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.80%, 3/15/2037(a) | 275000 | 302721 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 2/1/2061(a) | 225000 | 132552 |
|  NFP Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 8/15/2028(a) | 290000 | 250186 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 8/15/2028(a) | 4260000 | 3619658 |
|  |  | **15516293** |
| **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** |
|  Cars.com, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 11/1/2028(a) | 860000 | 745173 |
|  Rackspace Technology Global, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/15/2028(a) | 1850000 | 1221671 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 12/1/2028(a) | 1945000 | 818728 |
|  ZipRecruiter, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/15/2030(a) | 895000 | 732244 |
|  |  | **3517816** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Internet & Direct Marketing Retail – 0.6%** | **Internet & Direct Marketing Retail – 0.6%** | **Internet & Direct Marketing Retail – 0.6%** |
|  ANGI Group LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2028(a) | $1865000 | $1366169 |
|  Millennium Escrow Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 8/1/2026(a) | 1570000 | 1130400 |
|  Photo Holdings Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/1/2026(a) | 1630000 | 1072654 |
|  QVC, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 2/15/2025 | 1000000 | 874620 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2027 | 800000 | 633792 |
|  |  | **5077635** |
| **IT Services – 1.2%** | **IT Services – 1.2%** | **IT Services – 1.2%** |
|  Acuris Finance US, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2028(a) | 559000 | 452790 |
|  Ahead DB Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/1/2028(a) | 435000 | 353251 |
|  Arches Buyer, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 6/1/2028(a) | 900000 | 738324 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 12/1/2028(a) | 721000 | 555909 |
|  Cogent Communications Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 5/1/2026(a) | 610000 | 550525 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 6/15/2027(a) | 775000 | 735783 |
|  Conduent Business Services LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2029(a) | 1750000 | 1435000 |
|  Endurance International Group Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2029(a) | 1475000 | 984679 |
|  ION Trading Technologies Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/15/2028(a) | 655000 | 527000 |
|  Northwest Fiber LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/30/2027(a) | 55000 | 49442 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2028(a) | 430000 | 337352 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 6/1/2028(a) | 354000 | 332317 |
|  Presidio Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/1/2028(a) | 1115000 | 992350 |
|  Unisys Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/1/2027(a) | 1825000 | 1526863 |
|  Virtusa Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 12/15/2028(a) | 1240000 | 889480 |
|  |  | **10461065** |

---

*See Accompanying Notes to the Financial Statements.* 

428 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Leisure Products – 0.3%** | **Leisure Products – 0.3%** | **Leisure Products – 0.3%** |
|  Universal Entertainment Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 12/11/2024(a) | $1769000 | $1613469 |
|  Vista Outdoor, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/15/2029(a) | 1790000 | 1398599 |
|  |  | **3012068** |
| **Machinery – 1.2%** | **Machinery – 1.2%** | **Machinery – 1.2%** |
|  GrafTech Finance, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/15/2028(a) | 1830000 | 1482300 |
|  Granite US Holdings Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 10/1/2027(a) | 520000 | 486200 |
|  Husky III Holding Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 13.00%, 2/15/2025(a) (c) | 775000 | 708179 |
|  Interpipe Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.38%, 5/13/2026(a) | 500000 | 184030 |
|  JPW Industries Holding Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 10/1/2024(a) | 360000 | 311400 |
|  OT Merger Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 10/15/2029(a) | 655000 | 420838 |
|  SPX FLOW, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/1/2030(a) | 1140000 | 926250 |
|  Terex Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/15/2029(a) | 1290000 | 1150745 |
|  Titan Acquisition Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/15/2026(a) | 2235000 | 1827112 |
|  Titan International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 4/30/2028 | 305000 | 285123 |
|  TK Elevator Holdco GmbH |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 7/15/2028(a) | 830000 | 686016 |
|  TK Elevator US Newco, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2027(a) | 1840000 | 1649100 |
|  Wabash National Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/15/2028(a) | 875000 | 735562 |
|  |  | **10852855** |
| **Media – 6.6%** | **Media – 6.6%** | **Media – 6.6%** |
|  Advantage Sales & Marketing, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 11/15/2028(a) | 1190000 | 1012285 |
|  Altice Financing SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/15/2028(a) | 1705000 | 1348073 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 8/15/2029(a) | 4420000 | 3468639 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Belo Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 6/1/2027 | $410000 | $400164 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 9/15/2027 | 345000 | 332925 |
|  Cable One, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/15/2030(a) | 220000 | 179058 |
|  CMG Media Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.88%, 12/15/2027(a) | 2220000 | 1881450 |
|  CSC Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/1/2028(a) | 2015000 | 1745736 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/1/2029(a) | 195000 | 183787 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2030(a) | 1385000 | 1059525 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/1/2030(a) | 645000 | 464253 |
|  Diamond Sports Group LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 8/15/2026(a) | 10925000 | 2185000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 8/15/2027(a) | 6394000 | 311708 |
|  Directv Financing LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 8/15/2027(a) | 3970000 | 3575382 |
|  DISH DBS Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/15/2024 | 2725000 | 2511905 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 7/1/2026 | 7185000 | 6062631 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/1/2026(a) | 970000 | 842687 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 7/1/2028 | 3589000 | 2717304 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 12/1/2028(a) | 1610000 | 1298063 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 6/1/2029 | 4194000 | 2816892 |
|  GCI LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2028(a) | 1195000 | 1006071 |
|  Gray Escrow II, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/15/2031(a) | 1075000 | 862688 |
|  iHeartCommunications, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.38%, 5/1/2027 | 2600000 | 2335560 |
|  Liberty Interactive LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 7/15/2029 | 240000 | 152400 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/1/2030 | 135000 | 84276 |
|  McGraw-Hill Education, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 8/1/2028(a) | 1220000 | 1074210 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 8/1/2029(a) | 1660000 | 1413075 |
|  Nexstar Media, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 7/15/2027(a) | 360000 | 340020 |
|  Paramount Global |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.37%, 3/30/2062(d) | 1300000 | 1099045 |
|  Radiate Holdco LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/15/2026(a) | 815000 | 688675 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/15/2028(a) | 2240000 | 1411200 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 429

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Scripps Escrow II, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2031(a) | $| 220000 | $| 178750 |
|  Sinclair Television Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/15/2027(a) |  | 490000 |  | 411747 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2030(a) |  | 1775000 |  | 1327292 |
|  Sirius XM Radio, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 9/1/2026(a) |  | 1310000 |  | 1170616 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/1/2027(a) |  | 1990000 |  | 1830800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/15/2028(a) |  | 595000 |  | 511508 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 7/1/2030(a) |  | 795000 |  | 650539 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/1/2031(a) |  | 865000 |  | 692000 |
|  Summer BC Bidco B LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/31/2026(a) |  | 626000 |  | 498178 |
|  Townsquare Media, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 2/1/2026(a) |  | 800000 |  | 755352 |
|  Univision Communications, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2029(a) |  | 800000 |  | 673504 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 6/30/2030(a) |  | 345000 |  | 333788 |
|  UPC Holding BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) |  | 780000 |  | 684600 |
|  Urban One, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 2/1/2028(a) |  | 1080000 |  | 943704 |
|  Virgin Media Vendor Financing Notes IV DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/15/2028(a) |  | 885000 |  | 753490 |
|  VZ Secured Financing BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/15/2032(a) |  | 760000 |  | 605788 |
|  Ziggo Bond Co. BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2027(a) |  | 770000 |  | 692768 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/28/2030(a) |  | 963000 |  | 763101 |
|  Ziggo BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 1/15/2030(a) |  | 520000 |  | 436465 |
|  |  |  |  | **58778677** |
| **Metals & Mining – 2.1%** | **Metals & Mining – 2.1%** | **Metals & Mining – 2.1%** | **Metals & Mining – 2.1%** | **Metals & Mining – 2.1%** |
|  Arconic Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 2/15/2028(a) |  | 1820000 |  | 1706032 |
|  ATI, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 12/1/2027 |  | 600000 |  | 545362 |
|  Baffinland Iron Mines Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 7/15/2026(a) |  | 835000 |  | 758558 |
|  Carpenter Technology Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 7/15/2028 |  | 530000 |  | 489617 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Cleveland-Cliffs, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/1/2027 | $| 895000 | $| 832350 |
|  Compass Minerals International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/15/2024(a) |  | 320000 |  | 303222 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 12/1/2027(a) |  | 745000 |  | 700842 |
|  Constellium SE |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 6/15/2028(a) |  | 590000 |  | 517748 |
|  Eldorado Gold Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 9/1/2029(a) |  | 1835000 |  | 1484240 |
|  FMG Resources August 2006 Pty. Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/15/2030(a) |  | 305000 |  | 273676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/1/2031(a) |  | 875000 |  | 695450 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/15/2032(a) |  | 400000 |  | 351040 |
|  Hudbay Minerals, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2026(a) |  | 755000 |  | 662335 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2029(a) |  | 2100000 |  | 1737750 |
|  Kaiser Aluminum Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/1/2028(a) |  | 1110000 |  | 971028 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 6/1/2031(a) |  | 170000 |  | 133365 |
|  Mineral Resources Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/1/2027(a) |  | 680000 |  | 668923 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/1/2030(a) |  | 680000 |  | 668680 |
|  Novelis Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2031(a) |  | 400000 |  | 309884 |
|  Perenti Finance Pty. Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/7/2025(a) |  | 505000 |  | 455530 |
|  SunCoke Energy, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/30/2029(a) |  | 1850000 |  | 1517000 |
|  Tacora Resources, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 5/15/2026(a) |  | 761000 |  | 639660 |
|  TMS International Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/15/2029(a) |  | 1210000 |  | 848602 |
|  United States Steel Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 3/1/2029 |  | 682000 |  | 625851 |
|  Warrior Met Coal, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 12/1/2028(a) |  | 905000 |  | 892338 |
|  |  |  |  | **18789083** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.4%** |
|  Apollo Commercial Real Estate Finance, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/15/2029(a) |  | 1090000 |  | 858375 |

---

*See Accompanying Notes to the Financial Statements.* 

430 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** | **Mortgage Real Estate Investment Trusts (REITs) – (continued)** |
|  Blackstone Mortgage Trust, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 1/15/2027(a) | $| 645000 | $| 545425 |
|  Rithm Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 10/15/2025(a) |  | 1065000 |  | 934612 |
|  Starwood Property Trust, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 7/15/2026(a) |  | 445000 |  | 387150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2027(a) |  | 905000 |  | 799359 |
|  |  |  |  | **3524921** |
| **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** |
|  Algonquin Power & Utilities Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/18/2082(d) |  | 1470000 |  | 1183681 |
| **Oil, Gas & Consumable Fuels – 12.7%** | **Oil, Gas & Consumable Fuels – 12.7%** | **Oil, Gas & Consumable Fuels – 12.7%** | **Oil, Gas & Consumable Fuels – 12.7%** | **Oil, Gas & Consumable Fuels – 12.7%** |
|  Alliance Resource Operating Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 5/1/2025(a) |  | 155000 |  | 152088 |
|  Antero Midstream Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/15/2026(a) |  | 740000 |  | 754800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 3/1/2027(a) |  | 950000 |  | 904685 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2028(a) |  | 1270000 |  | 1196518 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/15/2029(a) |  | 1650000 |  | 1505295 |
|  Apache Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 2/1/2042 |  | 175000 |  | 140437 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/15/2043 |  | 300000 |  | 225000 |
|  Ascent Resources Utica Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/1/2026(a) |  | 510000 |  | 502350 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 12/31/2028(a) |  | 500000 |  | 482500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/30/2029(a) |  | 510000 |  | 447525 |
|  Baytex Energy Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/1/2027(a) |  | 975000 |  | 996937 |
|  Berry Petroleum Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 2/15/2026(a) |  | 335000 |  | 299825 |
|  Blue Racer Midstream LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 7/15/2026(a) |  | 180000 |  | 171000 |
|  Buckeye Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 12/1/2026 |  | 600000 |  | 526320 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 12/1/2027 |  | 195000 |  | 169385 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2028(a) |  | 585000 |  | 507487 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.85%, 11/15/2043 |  | 320000 |  | 240103 |
|  California Resources Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 2/1/2026(a) |  | 1186000 |  | 1163241 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Callon Petroleum Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 7/1/2026 | $515000 | $493849 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 8/1/2028(a) | 815000 | 811992 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 6/15/2030(a) | 1170000 | 1111266 |
|  Calumet Specialty Products Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 1/15/2027(a) | 565000 | 534741 |
|  Cheniere Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2029 | 120000 | 105954 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2031 | 175000 | 147540 |
|  Chesapeake Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 4/15/2029(a) | 1335000 | 1307597 |
|  Chord Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/1/2026(a) | 670000 | 654523 |
|  Civitas Resources, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/15/2026(a) | 720000 | 662717 |
|  CNX Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/15/2030(a) | 1000000 | 822500 |
|  Colgate Energy Partners III LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 2/15/2026(a) | 400000 | 397885 |
|  CQP Holdco LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 6/15/2031(a) | 5165000 | 4583938 |
|  Crescent Energy Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 5/1/2026(a) | 1475000 | 1367782 |
|  Crestwood Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 5/1/2027(a) | 775000 | 728947 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2029(a) | 1395000 | 1304465 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/1/2029(a) | 1170000 | 1170000 |
|  CVR Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 2/15/2028(a) | 655000 | 592775 |
|  Delek Logistics Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/15/2025 | 210000 | 202541 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 6/1/2028(a) | 1160000 | 1038718 |
|  DT Midstream, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 6/15/2029(a) | 625000 | 540312 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 6/15/2031(a) | 550000 | 463375 |
|  Earthstone Energy Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/15/2027(a) | 1045000 | 988664 |
|  Encino Acquisition Partners Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/1/2028(a) | 1620000 | 1517761 |
|  Energy Ventures Gom LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.75%, 4/15/2026(a) | 396000 | 406625 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 431

------

##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  EnLink Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 6/1/2025 | $490000 | $461717 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 4/1/2045 | 125000 | 90765 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 6/1/2047 | 130000 | 98773 |
|  EQM Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 12/1/2026 | 565000 | 499256 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 6/1/2027(a) | 685000 | 676437 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 7/1/2027(a) | 1500000 | 1462500 |
|  FTAI Infra Escrow Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 6/1/2027(a) | 705000 | 691252 |
|  Genesis Energy LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2025 | 1085000 | 1040424 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2026 | 585000 | 547376 |
|  Global Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 8/1/2027 | 755000 | 717765 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 1/15/2029 | 930000 | 841417 |
|  Gran Tierra Energy International Holdings Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/15/2025(a) | 920000 | 783335 |
|  Gran Tierra Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 5/23/2027(a) | 865000 | 670219 |
|  Gulfport Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 5/17/2026(a) | 644000 | 642068 |
|  Harbour Energy plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/15/2026(a) | 595000 | 536065 |
|  Harvest Midstream I LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/1/2028(a) | 1200000 | 1150465 |
|  Hess Midstream Operations LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 6/15/2028(a) | 500000 | 460000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2030(a) | 185000 | 158203 |
|  Hilcorp Energy I LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 11/1/2028(a) | 625000 | 587500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 2/1/2029(a) | 760000 | 695400 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/15/2030(a) | 990000 | 896449 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2031(a) | 725000 | 657887 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/15/2032(a) | 1135000 | 1041056 |
|  Holly Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 4/15/2027(a) | 595000 | 572667 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2028(a) | 945000 | 854086 |
|  Howard Midstream Energy Partners LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 1/15/2027(a) | 715000 | 648692 |
|  Ithaca Energy North Sea plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 7/15/2026(a) | 1203000 | 1187578 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  ITT Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 8/1/2029(a) | $2672000 | $2146965 |
|  Laredo Petroleum, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 7/31/2029(a) | 455000 | 432250 |
|  Magnolia Oil & Gas Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/1/2026(a) | 790000 | 767318 |
|  Martin Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 2/28/2025(a) | 200000 | 194000 |
|  Moss Creek Resources Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 5/15/2027(a) | 1680000 | 1612800 |
|  Murphy Oil Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.05%, 5/1/2029 | 420000 | 413812 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 12/1/2042(e) | 35000 | 27604 |
|  New Fortress Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 9/15/2025(a) | 1815000 | 1781796 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/30/2026(a) | 2185000 | 2119450 |
|  NGL Energy Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 2/1/2026(a) | 7385000 | 6680755 |
|  NGL Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 11/1/2023 | 635000 | 619125 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 3/1/2025 | 1380000 | 1076400 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2026 | 1205000 | 878264 |
|  Northern Oil and Gas, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 3/1/2028(a) | 1565000 | 1518050 |
|  Northriver Midstream Finance LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2026(a) | 450000 | 425997 |
|  NuStar Logistics LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/1/2025 | 870000 | 838881 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2026 | 655000 | 635088 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/28/2027 | 1327000 | 1231197 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 10/1/2030 | 2175000 | 2015769 |
|  Occidental Petroleum Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.88%, 7/15/2030 | 1305000 | 1481175 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 9/1/2030 | 370000 | 384821 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 5/1/2031 | 1200000 | 1290000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.45%, 9/15/2036 | 440000 | 436471 |
|  Parkland Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 7/15/2027(a) | 875000 | 822102 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2029(a) | 2850000 | 2399643 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 5/1/2030(a) | 2670000 | 2220946 |
|  PBF Holding Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2028 | 1780000 | 1617575 |

---

*See Accompanying Notes to the Financial Statements.* 

432 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Permian Resources Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2026(a) | $310000 | $286362 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/1/2027(a) | 350000 | 339500 |
|  ROCC Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 8/15/2026(a) | 830000 | 818820 |
|  Rockcliff Energy II LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/15/2029(a) | 185000 | 164767 |
|  Rockies Express Pipeline LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 7/15/2029(a) | 745000 | 653579 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 5/15/2030(a) | 675000 | 570375 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/15/2040(a) | 90000 | 73476 |
|  Strathcona Resources Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 8/1/2026(a) | 975000 | 825474 |
|  Summit Midstream Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/15/2026(a) | 1400000 | 1344000 |
|  Sunoco LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/15/2027 | 760000 | 744648 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 3/15/2028 | 870000 | 828219 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2029 | 3015000 | 2589584 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/30/2030 | 2550000 | 2168545 |
|  Tallgrass Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/1/2027(a) | 605000 | 570922 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) | 1580000 | 1416691 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/31/2030(a) | 2745000 | 2484829 |
|  Talos Production, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 12.00%, 1/15/2026 | 1290000 | 1367981 |
|  Tap Rock Resources LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 10/1/2026(a) | 600000 | 560196 |
|  Teine Energy Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/15/2029(a) | 690000 | 615466 |
|  TerraForm Power Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/31/2028(a) | 1380000 | 1278372 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2030(a) | 390000 | 350512 |
|  Topaz Solar Farms LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 9/30/2039(a) | 2406383 | 2286064 |
|  Venture Global Calcasieu Pass LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2029(a) | 760000 | 651700 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 8/15/2031(a) | 620000 | 528569 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/1/2033(a) | 720000 | 577800 |
|  Vermilion Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/1/2030(a) | 720000 | 673583 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  W&T Offshore, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 11/1/2023(a) | $| 370000 | $| 366331 |
|  Western Midstream Operating LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 4/1/2044 |  | 105000 |  | 85152 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 3/1/2048 |  | 200000 |  | 161500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/1/2050(e) |  | 820000 |  | 638354 |
|  |  |  |  | **113100940** |
| **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** | **Paper & Forest Products – 0.6%** |
|  Domtar Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/1/2028(a) |  | 1299000 |  | 1103792 |
|  Louisiana-Pacific Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2029(a) |  | 685000 |  | 557038 |
|  Mercer International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2026 |  | 452000 |  | 423458 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/1/2029 |  | 2875000 |  | 2361094 |
|  Sylvamo Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 9/1/2029(a) |  | 900000 |  | 836331 |
|  |  |  |  | **5281713** |
| **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** |
|  BellRing Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 3/15/2030(a) |  | 1705000 |  | 1610032 |
|  Herbalife Nutrition Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 9/1/2025(a) |  | 1157000 |  | 1080065 |
|  Oriflame Investment Holding plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/4/2026(a) |  | 1195000 |  | 715805 |
|  Prestige Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 1/15/2028(a) |  | 620000 |  | 576147 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 4/1/2031(a) |  | 200000 |  | 160402 |
|  |  |  |  | **4142451** |
| **Pharmaceuticals – 2.5%** | **Pharmaceuticals – 2.5%** | **Pharmaceuticals – 2.5%** | **Pharmaceuticals – 2.5%** | **Pharmaceuticals – 2.5%** |
|  Bausch Health Americas, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 4/1/2026(a) |  | 2990000 |  | 1728549 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 1/31/2027(a) |  | 2610000 |  | 1130488 |
|  Bausch Health Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/1/2025(a) |  | 1360000 |  | 1086613 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 12/15/2025(a) |  | 3518000 |  | 2262179 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 2/1/2027(a) |  | 3620000 |  | 2376315 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 8/15/2027(a) |  | 110000 |  | 69490 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 1/15/2028(a) |  | 765000 |  | 306000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/30/2028(a) |  | 1730000 |  | 670773 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 433

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2028(a) | $| 895000 | $| 548187 |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 9/30/2028(a) |  | 1085000 |  | 835450 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/15/2029(a) |  | 1700000 |  | 663612 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/15/2029(a) |  | 2870000 |  | 1119300 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 5/30/2029(a) |  | 1365000 |  | 521676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 14.00%, 10/15/2030(a) |  | 1290000 |  | 738525 |
|  Cheplapharm Arzneimittel GmbH |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) |  | 460000 |  | 381478 |
|  Elanco Animal Health, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.40%, 8/28/2028(e) |  | 1485000 |  | 1328511 |
|  HLF Financing Sarl LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2029(a) |  | 2130000 |  | 1581996 |
|  Jazz Securities DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2029(a) |  | 85000 |  | 75437 |
|  Mallinckrodt International Finance SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.00%, 4/15/2025(a) (e) |  | 710000 |  | 637225 |
|  Organon & Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 4/30/2028(a) |  | 380000 |  | 334712 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/30/2031(a) |  | 1437000 |  | 1220401 |
|  P&L Development LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 11/15/2025(a) |  | 935000 |  | 721783 |
|  Perrigo Finance Unlimited Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 12/15/2024 |  | 855000 |  | 814481 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 3/15/2026 |  | 915000 |  | 857227 |
|  |  |  |  | **22010408** |
| **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** | **Professional Services – 0.3%** |
|  ASGN, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 5/15/2028(a) |  | 595000 |  | 529092 |
|  CoreLogic, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2028(a) |  | 1510000 |  | 1015766 |
|  KBR, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 9/30/2028(a) |  | 425000 |  | 371709 |
|  Korn Ferry |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/15/2027(a) |  | 580000 |  | 527603 |
|  Science Applications International Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 4/1/2028(a) |  | 525000 |  | 478010 |
|  |  |  |  | **2922180** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Real Estate Management & Development – 1.7%** | **Real Estate Management & Development – 1.7%** | **Real Estate Management & Development – 1.7%** |
|  Forestar Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 5/15/2026(a) | $991000 | $843559 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2028(a) | 1195000 | 986219 |
|  Howard Hughes Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 2/1/2029(a) | 200000 | 156306 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/1/2031(a) | 300000 | 225420 |
|  Hunt Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2029(a) | 905000 | 728525 |
|  Kennedy-Wilson, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/1/2029 | 2100000 | 1702960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/1/2030 | 1920000 | 1507200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2031 | 2365000 | 1854160 |
|  Realogy Group LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2029(a) | 3265000 | 2346719 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2030(a) | 3650000 | 2530983 |
|  WeWork Cos. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/10/2025(a) | 1185000 | 592500 |
|  WeWork Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/1/2025(a) | 2425000 | 1323298 |
|  |  | **14797849** |
| **Road & Rail – 0.8%** | **Road & Rail – 0.8%** | **Road & Rail – 0.8%** |
|  Albion Financing 1 Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 10/15/2026(a) | 615000 | 525080 |
|  Albion Financing 2SARL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/15/2027(a) | 1055000 | 886200 |
|  Carriage Purchaser, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 10/15/2029(a) | 655000 | 484948 |
|  First Student Bidco, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/31/2029(a) | 305000 | 247843 |
|  Hertz Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/1/2026(a) | 695000 | 592487 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 12/1/2029(a) | 2125000 | 1683319 |
|  NESCO Holdings II, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2029(a) | 1280000 | 1122010 |
|  PECF USS Intermediate Holding III Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/15/2029(a) | 1195000 | 800244 |
|  Uber Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2028(a) | 785000 | 745750 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/15/2029(a) | 55000 | 47146 |
|  Watco Cos. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 6/15/2027(a) | 245000 | 230581 |
|  |  | **7365608** |

---

*See Accompanying Notes to the Financial Statements.* 

434 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Software – 3.4%** | **Software – 3.4%** | **Software – 3.4%** |
|  AthenaHealth Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2030(a) | $8760000 | $6832800 |
|  Boxer Parent Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.13%, 3/1/2026(a) | 180000 | 171913 |
|  Central Parent, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 6/15/2029(a) | 340000 | 324975 |
|  Clarivate Science Holdings Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/1/2029(a) | 2835000 | 2363681 |
|  Condor Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 2/15/2030(a) | 7625000 | 6306434 |
|  Consensus Cloud Solutions, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 10/15/2026(a) | 520000 | 468390 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/15/2028(a) | 985000 | 869441 |
|  GoTo Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/1/2027(a) | 2069000 | 1199482 |
|  Helios Software Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 5/1/2028(a) | 540000 | 416858 |
|  NortonLifeLock, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 9/30/2027(a) | 1300000 | 1281534 |
|  Open Text Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2028(a) | 250000 | 213985 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 12/1/2029(a) | 340000 | 269450 |
|  Open Text Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 2/15/2030(a) | 385000 | 306556 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 12/1/2031(a) | 500000 | 376250 |
|  Picard Midco, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 3/31/2029(a) | 2750000 | 2384753 |
|  Rocket Software, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2029(a) | 1215000 | 969910 |
|  SS&C Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/30/2027(a) | 2900000 | 2696394 |
|  Veritas US, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/1/2025(a) | 3650000 | 3072682 |
|  |  | **30525488** |
| **Specialty Retail – 3.4%** | **Specialty Retail – 3.4%** | **Specialty Retail – 3.4%** |
|  99 Escrow Issuer, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 1/15/2026(a) | 240000 | 136790 |
|  Arko Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 11/15/2029(a) | 845000 | 669025 |
|  At Home Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/15/2028(a) | 1015000 | 737956 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 7/15/2029(a) | 1890000 | 1067850 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Bath & Body Works, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.69%, 1/15/2027 | $275000 | $259188 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 6/15/2029 | 795000 | 753481 |
|  BCPE Ulysses Intermediate, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/1/2027(a) (c) | 870000 | 576149 |
|  eG Global Finance plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/7/2025(a) | 960000 | 864000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/30/2025(a) | 545000 | 503002 |
|  Guitar Center, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 1/15/2026(a) | 800000 | 699470 |
|  GYP Holdings III Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 5/1/2029(a) | 1205000 | 951621 |
|  LBM Acquisition LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2029(a) | 1805000 | 1262561 |
|  LCM Investments Holdings II LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/1/2029(a) | 480000 | 404890 |
|  LSF9 Atlantis Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 2/15/2026(a) | 990000 | 893330 |
|  Michaels Cos., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/1/2028(a) | 3100000 | 2201434 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/1/2029(a) | 4715000 | 2628612 |
|  Murphy Oil USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 5/1/2027 | 275000 | 263898 |
|  Park River Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/1/2029(a) | 895000 | 568297 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 8/1/2029(a) | 740000 | 486719 |
|  PetSmart, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 2/15/2029(a) | 2480000 | 2328621 |
|  Rent-A-Center, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 2/15/2029(a) | 1050000 | 817981 |
|  Specialty Building Products Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 9/30/2026(a) | 985000 | 791248 |
|  SRS Distribution, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 7/1/2028(a) | 270000 | 237071 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 7/1/2029(a) | 965000 | 784702 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/1/2029(a) | 1825000 | 1488013 |
|  Staples, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2026(a) | 4310000 | 3743580 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 4/15/2027(a) | 3593000 | 2616623 |
|  White Cap Buyer LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 10/15/2028(a) | 1295000 | 1097512 |
|  White Cap Parent LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 3/15/2026(a) (c) | 430000 | 363350 |
|  |  | **30196974** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 435

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##### [**Table of Contents**](#toc)

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FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Technology Hardware, Storage & Peripherals – 0.3%** | **Technology Hardware, Storage & Peripherals – 0.3%** | **Technology Hardware, Storage & Peripherals – 0.3%** |
|  Seagate HDD Cayman |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 1/15/2031 | $150000 | $112800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 12/1/2034 | 250000 | 203307 |
|  Xerox Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 12/15/2039 | 75000 | 54971 |
|  Xerox Holdings Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/15/2025(a) | 965000 | 871231 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/15/2028(a) | 1525000 | 1204750 |
|  |  | **2447059** |
| **Textiles, Apparel & Luxury Goods – 0.1%** | **Textiles, Apparel & Luxury Goods – 0.1%** | **Textiles, Apparel & Luxury Goods – 0.1%** |
|  Eagle Intermediate Global Holding BV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 5/1/2025(a) | 995000 | 766150 |
| **Thrifts & Mortgage Finance – 2.4%** | **Thrifts & Mortgage Finance – 2.4%** | **Thrifts & Mortgage Finance – 2.4%** |
|  Enact Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 8/15/2025(a) | 960000 | 945696 |
|  Freedom Mortgage Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 5/1/2026(a) | 1325000 | 1046803 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 1/15/2027(a) | 1240000 | 925536 |
|  Home Point Capital, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2026(a) | 1195000 | 706353 |
|  Ladder Capital Finance Holdings LLLP | Ladder Capital Finance Holdings LLLP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; REIT, 4.25%, 2/1/2027(a) | 1480000 | 1242993 |
| &nbsp;&nbsp;&nbsp;&nbsp; REIT, 4.75%, 6/15/2029(a) | 2305000 | 1834707 |
|  MGIC Investment Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/15/2028 | 185000 | 167838 |
|  Nationstar Mortgage Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/15/2028(a) | 1920000 | 1557331 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 12/15/2030(a) | 2215000 | 1656234 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 11/15/2031(a) | 1370000 | 1050953 |
|  NMI Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 6/1/2025(a) | 600000 | 599424 |
|  PennyMac Financial Services, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 10/15/2025(a) | 1335000 | 1208175 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2029(a) | 2290000 | 1734675 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 9/15/2031(a) | 1915000 | 1441982 |
|  PHH Mortgage Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 3/15/2026(a) | 790000 | 655700 |
|  Rocket Mortgage LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 10/15/2026(a) | 800000 | 667544 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/1/2029(a) | 210000 | 162750 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value | Value |
| **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/1/2031(a) | $| 650000 | $| 483275 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/15/2033(a) |  | 340000 |  | 237480 |
|  United Wholesale Mortgage LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/15/2025(a) |  | 940000 |  | 848787 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/15/2027(a) |  | 790000 |  | 647405 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2029(a) |  | 1380000 |  | 1041113 |
|  |  |  |  | **20862754** |
| **Tobacco – 0.4%** | **Tobacco – 0.4%** | **Tobacco – 0.4%** | **Tobacco – 0.4%** | **Tobacco – 0.4%** |
|  Turning Point Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2026(a) |  | 155000 |  | 135497 |
|  Vector Group Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 11/1/2026(a) |  | 1875000 |  | 1846528 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 2/1/2029(a) |  | 1905000 |  | 1666875 |
|  |  |  |  | **3648900** |
| **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** | **Trading Companies & Distributors – 0.7%** |
|  Alta Equipment Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/15/2026(a) |  | 530000 |  | 457766 |
|  Beacon Roofing Supply, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/15/2026(a) |  | 280000 |  | 255530 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 5/15/2029(a) |  | 695000 |  | 575099 |
|  BlueLinx Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/15/2029(a) |  | 655000 |  | 533825 |
|  Fortress Transportation and Infrastructure Investors LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 8/1/2027(a) |  | 595000 |  | 605761 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/1/2028(a) |  | 2055000 |  | 1718257 |
|  Foundation Building Materials, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/1/2029(a) |  | 935000 |  | 645948 |
|  Imola Merger Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2029(a) |  | 1295000 |  | 1116549 |
|  |  |  |  | **5908735** |
| **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** | **Wireless Telecommunication Services – 0.8%** |
|  C&W Senior Financing DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 9/15/2027(a) |  | 1870000 |  | 1621630 |
|  Connect Finco Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/1/2026(a) |  | 2260000 |  | 2124400 |
|  Hughes Satellite Systems Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 8/1/2026 |  | 1480000 |  | 1394160 |
|  Vmed O2 UK Financing I plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 1/31/2031(a) |  | 1056000 |  | 839615 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 7/15/2031(a) |  | 760000 |  | 614126 |

---

*See Accompanying Notes to the Financial Statements.* 

436 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br> Amount | Principal<br> Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** |
|  Vodafone Group plc |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.12%, 6/4/2081(d) | $| 315000 | $217677 |
|  |  |  | **6811608** |
| **Total Corporate Bonds <br>(Cost $950,787,508)** | **Total Corporate Bonds <br>(Cost $950,787,508)** | **Total Corporate Bonds <br>(Cost $950,787,508)** | **861008645** |
| **Total Investments – 97.0% <br>(Cost $950,787,508)** | **Total Investments – 97.0% <br>(Cost $950,787,508)** | **Total Investments – 97.0% <br>(Cost $950,787,508)** | **861008645** |
|  Other assets less liabilities – 3.0% | Other assets less liabilities – 3.0% | Other assets less liabilities – 3.0% | 26936723 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**887945368** |

---

*<sup>(a)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(b)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(c)</sup>* *Payment in-kind security.* 

*<sup>(d)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(e)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*SCA – Limited partnership with share capital* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $1769387 |
|  Aggregate gross unrealized depreciation | (110750060) |
|  Net unrealized depreciation | $(108980673) |
|  Federal income tax cost | $969989318 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 97.0% |
|  Others<sup>(1)</sup> | 3.0 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 437

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##### [**Table of Contents**](#toc)

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## Schedule of Investments
FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 97.3%** | **CORPORATE BONDS – 97.3%** | **CORPORATE BONDS – 97.3%** |
| **Airlines – 1.5%** | **Airlines – 1.5%** | **Airlines – 1.5%** |
|  American Airlines Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/1/2025(a) | $12000 | $10558 |
|  American Airlines, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.75%, 7/15/2025(a) | 39000 | 42651 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/20/2026(a) | 56000 | 53330 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/20/2029(a) | 46000 | 41860 |
|  United Airlines Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 1/15/2025 | 30000 | 28643 |
|  United Airlines, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/15/2026(a) | 83000 | 75751 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/15/2029(a) | 63000 | 53883 |
|  |  | **306676** |
| **Auto Components – 2.1%** | **Auto Components – 2.1%** | **Auto Components – 2.1%** |
|  American Axle & Manufacturing, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2029 | 62000 | 50336 |
|  Cooper-Standard Automotive, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 13.00%, 6/1/2024(a) | 12000 | 12289 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 11/15/2026(a) | 12000 | 4547 |
|  Dealer Tire LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 2/1/2028(a) | 12000 | 10495 |
|  Goodyear Tire & Rubber Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 5/31/2025 | 50000 | 51962 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/31/2026 | 69000 | 66460 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/30/2031 | 37000 | 31134 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2031 | 43000 | 36429 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/30/2033 | 19000 | 15905 |
|  Icahn Enterprises LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 12/15/2025 | 13000 | 12620 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2026 | 44000 | 42262 |
|  IHO Verwaltungs GmbH |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 5/15/2027(a)(b) | 37000 | 31774 |
|  Real Hero Merger Sub 2, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/1/2029(a) | 17000 | 12188 |
|  Tenneco, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/15/2026 | 2000 | 1995 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 1/15/2029(a) | 13000 | 12843 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/15/2029(a) | 21000 | 20759 |
|  Wheel Pros, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/15/2029(a) | 12000 | 5648 |
|  ZF North America Capital, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/29/2025(a) | 13000 | 12153 |
|  |  | **431799** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Automobiles – 0.6%** | **Automobiles – 0.6%** | **Automobiles – 0.6%** |
|  Ford Motor Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 12/8/2026 | $25000 | $23251 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.45%, 7/16/2031 | 13000 | 13046 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/12/2032 | 31000 | 23275 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2043 | 43000 | 29948 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.29%, 12/8/2046 | 13000 | 9624 |
|  Mclaren Finance plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 8/1/2026(a) | 30000 | 23776 |
|  |  | **122920** |
| **Banks – 1.1%** | **Banks – 1.1%** | **Banks – 1.1%** |
|  Intesa Sanpaolo SpA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.02%, 6/26/2024(a) | 10000 | 9440 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.71%, 1/15/2026(a) | 75000 | 69865 |
|  Provident Financing Trust I |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.41%, 3/15/2038 | 6000 | 6180 |
|  UniCredit SpA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.86%, 6/19/2032(a)(c) | 32000 | 26513 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.30%, 4/2/2034(a)(c) | 125000 | 106055 |
|  |  | **218053** |
| **Beverages – 0.1%** | **Beverages – 0.1%** | **Beverages – 0.1%** |
|  Primo Water Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/30/2029(a) | 33000 | 27650 |
| **Biotechnology – 0.2%** | **Biotechnology – 0.2%** | **Biotechnology – 0.2%** |
|  Emergent BioSolutions, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2028(a) | 12000 | 7194 |
|  Grifols Escrow Issuer SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2028(a) | 35000 | 27344 |
|  |  | **34538** |
| **Building Products – 0.8%** | **Building Products – 0.8%** | **Building Products – 0.8%** |
|  Advanced Drainage Systems, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/30/2027(a) | 12000 | 11127 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2030(a) | 25000 | 24160 |
|  Builders FirstSource, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2030(a) | 50000 | 42942 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2032(a) | 19000 | 15204 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2032(a) | 13000 | 11956 |
|  New Enterprise Stone & Lime Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 7/15/2028(a) | 13000 | 11310 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 7/15/2028(a) | 5000 | 4291 |

---

*See Accompanying Notes to the Financial Statements.* 

438 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** | **Building Products – (continued)** |
|  Smyrna Ready Mix Concrete LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/1/2028(a) | $| 31000 | $| 26040 |
|  Summit Materials LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 1/15/2029(a) |  | 13000 |  | 11872 |
|  |  |  |  | **158902** |
| **Capital Markets – 1.6%** | **Capital Markets – 1.6%** | **Capital Markets – 1.6%** | **Capital Markets – 1.6%** | **Capital Markets – 1.6%** |
|  Advisor Group Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 8/1/2027(a) |  | 17000 |  | 16756 |
|  AG TTMT Escrow Issuer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 9/30/2027(a) |  | 18000 |  | 18068 |
|  Aretec Escrow Issuer, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/1/2029(a) |  | 12000 |  | 9840 |
|  Coinbase Global, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 10/1/2028(a) |  | 31000 |  | 20262 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 10/1/2031(a) |  | 37000 |  | 21909 |
|  Dresdner Funding Trust I |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.15%, 6/30/2031(a) |  | 25000 |  | 25531 |
|  LPL Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/15/2029(a) |  | 60000 |  | 52367 |
|  MSCI, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/15/2029(a) |  | 43000 |  | 37338 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 9/1/2030(a) |  | 111000 |  | 92752 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2031(a) |  | 43000 |  | 36232 |
|  Nomura Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 1/16/2025 |  | 5000 |  | 4680 |
|  |  |  |  | **335735** |
| **Chemicals – 2.1%** | **Chemicals – 2.1%** | **Chemicals – 2.1%** | **Chemicals – 2.1%** | **Chemicals – 2.1%** |
|  ASP Unifrax Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/30/2029(a) |  | 12000 |  | 8040 |
|  Avient Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/15/2025(a) |  | 44000 |  | 43072 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 8/1/2030(a) |  | 25000 |  | 23907 |
|  Axalta Coating Systems LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/15/2029(a) |  | 37000 |  | 30409 |
|  Chemours Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 11/15/2028(a) |  | 31000 |  | 26335 |
|  Cornerstone Chemical Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 8/15/2024(a) |  | 12000 |  | 9023 |
|  CVR Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 6/15/2028(a) |  | 12000 |  | 10857 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** | **Chemicals – (continued)** |
|  Element Solutions, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/1/2028(a) | $| 43000 | $| 36550 |
|  Gates Global LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2026(a) |  | 12000 |  | 11520 |
|  GPD Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.13%, 4/1/2026(a) |  | 12000 |  | 10728 |
|  Illuminate Buyer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 7/1/2028(a) |  | 12000 |  | 10135 |
|  LSF11 A5 HoldCo LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 10/15/2029(a) |  | 12000 |  | 9459 |
|  Methanex Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/15/2029 |  | 12000 |  | 10269 |
|  Nufarm Australia Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/27/2030(a) |  | 12000 |  | 10151 |
|  Olympus Water US Holding Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 10/1/2029(a) |  | 5000 |  | 3462 |
|  SCIH Salt Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/1/2028(a) |  | 25000 |  | 21700 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/1/2029(a) |  | 37000 |  | 29698 |
|  Scotts Miracle-Gro Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/1/2031 |  | 10000 |  | 7661 |
|  SPCM SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/15/2030(a) |  | 30000 |  | 23925 |
|  Valvoline, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2030(a) |  | 25000 |  | 24062 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 6/15/2031(a) |  | 25000 |  | 19725 |
|  Venator Finance Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 7/15/2025(a) |  | 12000 |  | 3960 |
|  WR Grace Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 8/15/2029(a) |  | 44000 |  | 34011 |
|  |  |  |  | **418659** |
| **Commercial Services & Supplies – 1.9%** | **Commercial Services & Supplies – 1.9%** | **Commercial Services & Supplies – 1.9%** | **Commercial Services & Supplies – 1.9%** | **Commercial Services & Supplies – 1.9%** |
|  Allied Universal Holdco LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 7/15/2026(a) |  | 71000 |  | 67808 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 7/15/2027(a) |  | 70000 |  | 60859 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2029(a) |  | 21000 |  | 14580 |
|  Aptim Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 6/15/2025(a) |  | 2000 |  | 1374 |
|  Garda World Security Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/15/2027(a) |  | 16000 |  | 14210 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 11/1/2027(a) |  | 19000 |  | 17147 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/1/2029(a) |  | 12000 |  | 9352 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 439

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** | **Commercial Services & Supplies – (continued)** |
|  GFL Environmental, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 9/1/2028(a) | $| 25000 | $| 21196 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/15/2029(a) |  | 19000 |  | 16560 |
|  IAA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 6/15/2027(a) |  | 19000 |  | 17780 |
|  Interface, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 12/1/2028(a) |  | 12000 |  | 9469 |
|  Intrado Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/15/2025(a) |  | 13000 |  | 11365 |
|  Prime Security Services Borrower LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/15/2026(a) |  | 8000 |  | 7787 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2028(a) |  | 40000 |  | 36759 |
|  Ritchie Bros Auctioneers, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2025(a) |  | 12000 |  | 11820 |
|  Vericast Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 9/15/2026(a) |  | 35000 |  | 34344 |
|  WASH Multifamily Acquisition, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/15/2026(a) |  | 22000 |  | 20514 |
|  Waste Pro USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/15/2026(a) |  | 12000 |  | 11105 |
|  |  |  |  | **384029** |
| **Communications Equipment – 0.9%** | **Communications Equipment – 0.9%** | **Communications Equipment – 0.9%** | **Communications Equipment – 0.9%** | **Communications Equipment – 0.9%** |
|  CommScope Technologies LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/15/2025(a) |  | 37000 |  | 34503 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/15/2027(a) |  | 43000 |  | 34813 |
|  CommScope, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/1/2026(a) |  | 43000 |  | 41475 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 3/1/2027(a) |  | 50000 |  | 44390 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 9/1/2029(a) |  | 37000 |  | 31296 |
|  |  |  |  | **186477** |
| **Construction & Engineering – 0.6%** | **Construction & Engineering – 0.6%** | **Construction & Engineering – 0.6%** | **Construction & Engineering – 0.6%** | **Construction & Engineering – 0.6%** |
|  AECOM |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 3/15/2027 |  | 40000 |  | 37871 |
|  Artera Services LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.03%, 12/4/2025(a) |  | 31000 |  | 25905 |
|  Brand Industrial Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 7/15/2025(a) |  | 30000 |  | 21569 |
|  Cellnex Finance Co. SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 7/7/2041(a) |  | 6000 |  | 3673 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** | **Construction & Engineering – (continued)** |
|  Global Infrastructure Solutions, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 6/1/2029(a) | $| 12000 | $| 8873 |
|  Pike Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/1/2028(a) |  | 12000 |  | 10247 |
|  Tutor Perini Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/1/2025(a) |  | 12000 |  | 9549 |
|  |  |  |  | **117687** |
| **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** |
|  Cobra Acquisition Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 11/1/2029(a) |  | 12000 |  | 7980 |
|  Ford Motor Credit Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 11/13/2025 |  | 340000 |  | 308451 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/13/2030 |  | 250000 |  | 202195 |
|  goeasy Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 12/1/2024(a) |  | 19000 |  | 17733 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/1/2026(a) |  | 12000 |  | 10290 |
|  LFS Topco LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 10/15/2026(a) |  | 13000 |  | 10158 |
|  OneMain Finance Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 3/15/2024 |  | 81000 |  | 79139 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 3/15/2025 |  | 37000 |  | 35890 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 3/15/2026 |  | 35000 |  | 33705 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/15/2027 |  | 43000 |  | 35243 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 1/15/2028 |  | 37000 |  | 33612 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/15/2028 |  | 25000 |  | 19467 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 11/15/2029 |  | 43000 |  | 35260 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/15/2030 |  | 37000 |  | 27935 |
|  SLM Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 10/29/2025 |  | 13000 |  | 12070 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 11/2/2026 |  | 13000 |  | 11402 |
|  |  |  |  | **880530** |
| **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** | **Containers & Packaging – 1.6%** |
|  Ball Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 11/15/2023 |  | 56000 |  | 54837 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 8/15/2030 |  | 56000 |  | 43490 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 9/15/2031 |  | 56000 |  | 42879 |
|  Berry Global, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 7/15/2027(a) |  | 25000 |  | 23711 |
|  Cascades, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2028(a) |  | 28000 |  | 23947 |

---

*See Accompanying Notes to the Financial Statements.* 

440 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** | **Containers & Packaging – (continued)** |
|  Crown Americas LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/1/2026 | $| 36000 | $| 34456 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 9/30/2026 |  | 37000 |  | 34180 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/1/2030(a) |  | 20000 |  | 18298 |
|  Graphic Packaging International LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 8/15/2024 |  | 13000 |  | 12667 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/15/2028(a) |  | 13000 |  | 11240 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/1/2029(a) |  | 13000 |  | 10980 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/1/2030(a) |  | 13000 |  | 11177 |
|  |  |  |  | **321862** |
| **Distributors – 0.2%** | **Distributors – 0.2%** | **Distributors – 0.2%** | **Distributors – 0.2%** | **Distributors – 0.2%** |
|  American Builders & Contractors Supply Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 1/15/2028(a) |  | 12000 |  | 10589 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/15/2029(a) |  | 12000 |  | 9857 |
|  BCPE Empire Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 5/1/2027(a) |  | 12000 |  | 10961 |
|  Univar Solutions USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 12/1/2027(a) |  | 12000 |  | 11100 |
|  |  |  |  | **42507** |
| **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** | **Diversified Consumer Services – 0.6%** |
|  Adtalem Global Education, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2028(a) |  | 13000 |  | 11863 |
|  Service Corp. International |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/15/2027 |  | 25000 |  | 23163 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 8/15/2030 |  | 69000 |  | 55699 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/15/2031 |  | 25000 |  | 20748 |
|  Signal Parent, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2029(a) |  | 6000 |  | 2584 |
|  Sotheby's |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 10/15/2027(a) |  | 5000 |  | 4837 |
|  |  |  |  | **118894** |
| **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** | **Diversified Financial Services – 0.6%** |
|  Armor Holdco, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 11/15/2029(a) |  | 10000 |  | 7456 |
|  CPI CG, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 3/15/2026(a) |  | 12000 |  | 11317 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** | **Diversified Financial Services – (continued)** |
|  Midcap Financial Issuer Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/1/2028(a) | $| 25000 | $| 21247 |
|  Paysafe Finance plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/15/2029(a) |  | 10000 |  | 7150 |
|  Sabre GLBL, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 4/15/2025(a) |  | 43000 |  | 41641 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 9/1/2025(a) |  | 13000 |  | 12203 |
|  Shift4 Payments LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/1/2026(a) |  | 13000 |  | 11984 |
|  Verscend Escrow Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 8/15/2026(a) |  | 19000 |  | 19058 |
|  |  |  |  | **132056** |
| **Diversified Telecommunication Services – 7.8%** | **Diversified Telecommunication Services – 7.8%** | **Diversified Telecommunication Services – 7.8%** | **Diversified Telecommunication Services – 7.8%** | **Diversified Telecommunication Services – 7.8%** |
|  Altice France Holding SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 5/15/2027(a) |  | 55000 |  | 42860 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2028(a) |  | 50000 |  | 32334 |
|  Altice France SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 7/15/2029(a) |  | 10000 |  | 7532 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/15/2029(a) |  | 33000 |  | 25162 |
|  British Telecommunications plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 11/23/2081(a)(c) |  | 35000 |  | 29176 |
|  CCO Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/1/2027(a) |  | 123000 |  | 113957 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2028(a) |  | 81000 |  | 73305 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/1/2029(a) |  | 50000 |  | 44669 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/1/2030(a) |  | 100000 |  | 84040 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/15/2030(a) |  | 121000 |  | 98199 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2031(a) |  | 93000 |  | 73470 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2032 |  | 137000 |  | 108230 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 1/15/2034(a) |  | 28000 |  | 20580 |
|  Embarq Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 6/1/2036 |  | 44000 |  | 17693 |
|  Iliad Holding SASU |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/15/2026(a) |  | 50000 |  | 46306 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 10/15/2028(a) |  | 15000 |  | 13575 |
|  Intelsat Jackson Holdings SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 3/15/2030(a) |  | 25000 |  | 22944 |
|  Level 3 Financing, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/1/2027(a) |  | 35000 |  | 30130 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 9/15/2027(a) |  | 31000 |  | 26901 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/1/2028(a) |  | 68000 |  | 56100 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 7/15/2029(a) |  | 50000 |  | 37987 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 441

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |  |  |  |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |  |  |  |
| **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** | **Diversified Telecommunication Services – (continued)** |  |  |  |
|  Lumen Technologies, Inc. |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/1/2025 | $| 13000 | $| 12610 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 12/15/2026(a) |  | 25000 |  | 21406 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/15/2027(a) |  | 56000 |  | 47611 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 1/15/2029(a) |  | 25000 |  | 17624 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/15/2029(a) |  | 15000 |  | 11016 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series P,<br>7.60%, 9/15/2039 |  | 25000 |  | 16749 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series P,<br>7.60%, 9/15/2039 |  | 25000 |  | 16749 | &nbsp;&nbsp;&nbsp;&nbsp; Series U,<br>7.65%, 3/15/2042 | 25000 | 16562 |
|  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; Series U,<br>7.65%, 3/15/2042 | 25000 | 16562 |
|  Sprint Capital Corp. |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/15/2028 |  | 87000 |  | 89782 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 3/15/2032 |  | 87000 |  | 102107 |  |  |  |
|  Switch Ltd. |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 9/15/2028(a) |  | 50000 |  | 50500 |  |  |  |
|  Telecom Italia Capital SA |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 11/15/2033 |  | 29000 |  | 22283 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/30/2034 |  | 12000 |  | 8757 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.20%, 7/18/2036 |  | 38000 |  | 29593 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.72%, 6/4/2038 |  | 25000 |  | 19875 |  |  |  |
|  Telecom Italia SpA |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 5/30/2024(a) |  | 60000 |  | 56446 |  |  |  |
|  Telesat Canada |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 12/6/2026(a) |  | 15000 |  | 7080 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/15/2027(a) |  | 25000 |  | 8716 |  |  |  |
|  Windstream Escrow LLC |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 8/15/2028(a) |  | 50000 |  | 43265 |  |  |  |
|  |  |  |  | **1587132** |  |  |  |
| **Electric Utilities – 0.3%** | **Electric Utilities – 0.3%** | **Electric Utilities – 0.3%** | **Electric Utilities – 0.3%** | **Electric Utilities – 0.3%** |  |  |  |
|  FirstEnergy Corp. |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B,<br>4.40%, 7/15/2027(d) |  | 25000 |  | 23478 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B,<br>4.40%, 7/15/2027(d) |  | 25000 |  | 23478 | &nbsp;&nbsp;&nbsp;&nbsp; Series C,<br>7.38%, 11/15/2031 | 12000 | 13350 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C,<br>3.40%, 3/1/2050 |  | 12000 |  | 7455 | &nbsp;&nbsp;&nbsp;&nbsp; Series C,<br>7.38%, 11/15/2031 | 12000 | 13350 |
|  Pattern Energy Operations LP |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/15/2028(a) |  | 19000 |  | 17087 |  |  |  |
|  |  |  |  | **61370** |  |  |  |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** | **Electrical Equipment – 0.4%** |
|  Atkore, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 6/1/2031(a) | $12000 | $9720 |
|  EnerSys |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 12/15/2027(a) | 12000 | 10530 |
|  Sensata Technologies BV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2025(a) | 37000 | 35849 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2029(a) | 35000 | 29477 |
|  |  | **85576** |
| **Electronic Equipment, Instruments & Components – 0.3%** | **Electronic Equipment, Instruments & Components – 0.3%** | **Electronic Equipment, Instruments & Components – 0.3%** |
|  Likewize Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 10/15/2025(a) | 12000 | 10857 |
|  Sensata Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2031(a) | 55000 | 43794 |
|  |  | **54651** |
| **Energy Equipment & Services – 2.0%** | **Energy Equipment & Services – 2.0%** | **Energy Equipment & Services – 2.0%** |
|  Archrock Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/1/2027(a) | 19000 | 18097 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/1/2028(a) | 43000 | 39986 |
|  CGG SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/1/2027(a) | 5000 | 4421 |
|  Ensign Drilling, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 4/15/2024(a) | 12000 | 10859 |
|  KLX Energy Services Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 11/1/2025(a) | 12000 | 9819 |
|  Nine Energy Service, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 11/1/2023(a) | 2000 | 1745 |
|  Patterson-UTI Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 11/15/2029 | 28000 | 24720 |
|  Petrofac Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 11/15/2026(a) | 31000 | 22975 |
|  Solaris Midstream Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 4/1/2026(a) | 12000 | 11430 |
|  TechnipFMC plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/1/2026(a) | 4000 | 3841 |
|  Transocean Guardian Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 1/15/2024(a) | 6514 | 6332 |
|  Transocean Phoenix 2 Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 10/15/2024(a) | 5200 | 5172 |
|  Transocean Poseidon Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 2/1/2027(a) | 43750 | 41891 |
|  Transocean Proteus Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 12/1/2024(a) | 1350 | 1316 |

---

*See Accompanying Notes to the Financial Statements.* 

442 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** | **Energy Equipment & Services – (continued)** |
|  Transocean, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 1/15/2026(a) | $| 44000 | $| 37180 |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 1/30/2027(a) |  | 31000 |  | 31142 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 2/1/2027(a) |  | 19000 |  | 15397 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2031 |  | 12000 |  | 7830 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.80%, 3/15/2038 |  | 12000 |  | 7290 |
|  USA Compression Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/1/2026 |  | 57000 |  | 54713 |
|  Weatherford International Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/15/2028(a) |  | 13000 |  | 12415 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 4/30/2030(a) |  | 50000 |  | 47125 |
|  |  |  |  | **415696** |
| **Entertainment – 0.7%** | **Entertainment – 0.7%** | **Entertainment – 0.7%** | **Entertainment – 0.7%** | **Entertainment – 0.7%** |
|  Allen Media LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 2/15/2028(a) |  | 12000 |  | 4863 |
|  Live Nation Entertainment, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 5/15/2027(a) |  | 62000 |  | 61666 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2027(a) |  | 50000 |  | 44496 |
|  ROBLOX Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 5/1/2030(a) |  | 37000 |  | 30525 |
|  |  |  |  | **141550** |
| **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** |
|  Diversified Healthcare Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2028 |  | 40000 |  | 27374 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 3/1/2031 |  | 28000 |  | 18503 |
|  HAT Holdings I LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 6/15/2026(a) |  | 44000 |  | 35773 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 9/15/2030(a) |  | 25000 |  | 17250 |
|  MPT Operating Partnership LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/1/2026 |  | 19000 |  | 17136 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/15/2027 |  | 56000 |  | 47924 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 8/1/2029 |  | 43000 |  | 34066 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/15/2031 |  | 56000 |  | 38481 |
|  Park Intermediate Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 6/1/2025(a) |  | 23000 |  | 23057 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 10/1/2028(a) |  | 29000 |  | 26318 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/15/2029(a) |  | 19000 |  | 16201 |
|  RHP Hotel Properties LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2027 |  | 25000 |  | 23076 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/15/2029(a) |  | 25000 |  | 21938 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  SBA Communications Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2027 | $| 68000 | $| 61200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 2/1/2029 |  | 68000 |  | 54960 |
|  XHR LP<br>4.88%, 6/1/2029(a) |  | 10000 |  | 8627 |
|  |  |  |  | **471884** |
| **Food & Staples Retailing – 1.6%** | **Food & Staples Retailing – 1.6%** | **Food & Staples Retailing – 1.6%** | **Food & Staples Retailing – 1.6%** | **Food & Staples Retailing – 1.6%** |
|  Albertsons Cos., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/15/2027(a) |  | 43000 |  | 39849 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 2/15/2028(a) |  | 58000 |  | 54230 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/15/2029(a) |  | 43000 |  | 35582 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 2/15/2030(a) |  | 28000 |  | 24850 |
|  Rite Aid Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/15/2026(a) |  | 62000 |  | 40152 |
|  Safeway, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 2/1/2031 |  | 12000 |  | 11574 |
|  US Foods, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/15/2025(a) |  | 62000 |  | 61702 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2029(a) |  | 37000 |  | 32791 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/1/2030(a) |  | 19000 |  | 16483 |
|  |  |  |  | **317213** |
| **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** | **Food Products – 0.9%** |
|  Darling Ingredients, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2027(a) |  | 12000 |  | 11520 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 6/15/2030(a) |  | 25000 |  | 24062 |
|  Lamb Weston Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/15/2028(a) |  | 44000 |  | 40901 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/31/2032(a) |  | 44000 |  | 37785 |
|  Pilgrim's Pride Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 9/30/2027(a) |  | 40000 |  | 39098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 4/15/2031(a) |  | 43000 |  | 35811 |
|  |  |  |  | **189177** |
| **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** | **Gas Utilities – 0.8%** |
|  AmeriGas Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 5/20/2024 |  | 37000 |  | 36156 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 8/20/2026 |  | 31000 |  | 29001 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/20/2027 |  | 19000 |  | 17521 |
|  Ferrellgas LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 4/1/2026(a) |  | 12000 |  | 10890 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/1/2029(a) |  | 43000 |  | 36034 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 443

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Gas Utilities – (continued)** | **Gas Utilities – (continued)** | **Gas Utilities – (continued)** | **Gas Utilities – (continued)** | **Gas Utilities – (continued)** |
|  Suburban Propane Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/1/2031(a) | $| 33000 | $| 27741 |
|  |  |  |  | **157343** |
| **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** | **Health Care Equipment & Supplies – 0.8%** |
|  Embecta Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/15/2030(a) |  | 10000 |  | 9150 |
|  Hologic, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/1/2028(a) |  | 13000 |  | 12155 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/15/2029(a) |  | 43000 |  | 36541 |
|  Medline Borrower LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 4/1/2029(a) |  | 37000 |  | 30229 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 10/1/2029(a) |  | 68000 |  | 52955 |
|  Teleflex, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 11/15/2027 |  | 13000 |  | 12251 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 6/1/2028(a) |  | 13000 |  | 11762 |
|  |  |  |  | **165043** |
| **Health Care Providers & Services – 5.6%** | **Health Care Providers & Services – 5.6%** | **Health Care Providers & Services – 5.6%** | **Health Care Providers & Services – 5.6%** | **Health Care Providers & Services – 5.6%** |
|  180 Medical, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 10/15/2029(a) |  | 5000 |  | 4225 |
|  Acadia Healthcare Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 4/15/2029(a) |  | 44000 |  | 39708 |
|  AHP Health Partners, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 7/15/2029(a) |  | 12000 |  | 9180 |
|  Air Methods Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 5/15/2025(a) |  | 12000 |  | 6212 |
|  Akumin Escrow, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 8/1/2028(a) |  | 25000 |  | 17963 |
|  Akumin, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/1/2025(a) |  | 12000 |  | 9704 |
|  Community Health Systems, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 3/15/2026(a) |  | 15000 |  | 12938 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 3/15/2027(a) |  | 13000 |  | 10359 |
|  DaVita, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/1/2030(a) |  | 123000 |  | 95894 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2031(a) |  | 75000 |  | 54227 |
|  Encompass Health Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/1/2028 |  | 44000 |  | 39376 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/1/2030 |  | 34000 |  | 28985 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 4/1/2031 |  | 25000 |  | 20625 |
|  Envision Healthcare Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 10/15/2026(a) |  | 19000 |  | 5700 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Global Medical Response, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2025(a) | $| 12000 | $| 9540 |
|  Legacy LifePoint Health LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 4/15/2025(a) |  | 13000 |  | 11505 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/15/2027(a) |  | 30000 |  | 23654 |
|  LifePoint Health, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 1/15/2029(a) |  | 12000 |  | 7666 |
|  Molina Healthcare, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/15/2030(a) |  | 80000 |  | 67984 |
|  Owens & Minor, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/31/2029(a) |  | 28000 |  | 21682 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 4/1/2030(a) |  | 19000 |  | 15795 |
|  Prime Healthcare Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 11/1/2025(a) |  | 25000 |  | 21789 |
|  Radiology Partners, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 2/1/2028(a) |  | 20000 |  | 10580 |
|  RegionalCare Hospital Partners Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 12/1/2026(a) |  | 43000 |  | 34284 |
|  RP Escrow Issuer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/15/2025(a) |  | 20000 |  | 14955 |
|  Select Medical Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 8/15/2026(a) |  | 43000 |  | 40989 |
|  Team Health Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 2/1/2025(a) |  | 23000 |  | 17365 |
|  Tenet Healthcare Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 1/1/2026(a) |  | 153000 |  | 144585 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/1/2027(a) |  | 50000 |  | 47716 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 11/1/2027(a) |  | 100000 |  | 92125 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 10/1/2028(a) |  | 100000 |  | 86550 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2030(a) |  | 37000 |  | 31043 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 6/15/2030(a) |  | 37000 |  | 34156 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/15/2031 |  | 22000 |  | 18673 |
|  US Acute Care Solutions LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 3/1/2026(a) |  | 23000 |  | 20853 |
|  US Renal Care, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.63%, 7/15/2027(a) |  | 17000 |  | 6749 |
|  |  |  |  | **1135334** |
| **Health Care Technology – 0.3%** | **Health Care Technology – 0.3%** | **Health Care Technology – 0.3%** | **Health Care Technology – 0.3%** | **Health Care Technology – 0.3%** |
|  IQVIA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/15/2027(a) |  | 60000 |  | 57173 |

---

*See Accompanying Notes to the Financial Statements.* 

444 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Hotels, Restaurants & Leisure – 9.3%** | **Hotels, Restaurants & Leisure – 9.3%** | **Hotels, Restaurants & Leisure – 9.3%** |
|  1011778 BC ULC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/15/2030(a) | $37000 | $30201 |
|  Affinity Gaming |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 12/15/2027(a) | 18000 | 15026 |
|  Arrow Bidco LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 3/15/2024(a) | 12000 | 12059 |
|  Boyne USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2029(a) | 22000 | 19250 |
|  Caesars Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 7/1/2025(a) | 37000 | 36102 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 7/1/2027(a) | 6000 | 5835 |
|  Carnival Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 3/1/2027(a) | 37000 | 25640 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 8/1/2028(a) | 19000 | 15308 |
|  Carnival Holdings Bermuda Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.38%, 5/1/2028(a) | 15000 | 15189 |
|  CEC Entertainment LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/1/2026(a) | 12000 | 11224 |
|  Cedar Fair LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/1/2025(a) | 12000 | 11910 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2028 | 75000 | 70275 |
|  Constellation Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 9/15/2025(a) | 12000 | 10620 |
|  Fertitta Entertainment LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/15/2029(a) | 33000 | 28700 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 1/15/2030(a) | 37000 | 29045 |
|  GPS Hospitality Holding Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 8/15/2028(a) | 10000 | 7025 |
|  Hilton Domestic Operating Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 5/1/2028(a) | 31000 | 29915 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 1/15/2030 | 62000 | 55568 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/1/2031(a) | 50000 | 41797 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 2/15/2032(a) | 87000 | 69274 |
|  Hilton Worldwide Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 4/1/2027 | 31000 | 29450 |
|  International Game Technology plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 4/15/2026(a) | 128000 | 118784 |
|  IRB Holding Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 6/15/2025(a) | 19000 | 18990 |
|  Jacobs Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/15/2029(a) | 13000 | 11462 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  KFC Holding Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 6/1/2027(a) | $19000 | $18137 |
|  Las Vegas Sands Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 8/8/2024 | 79000 | 75222 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 8/8/2029 | 93000 | 75171 |
|  Life Time, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2026(a) | 50000 | 46500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/15/2026(a) | 12000 | 10462 |
|  MGM Resorts International |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/15/2025 | 50000 | 48500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 9/1/2026 | 13000 | 11862 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 10/15/2028 | 50000 | 43352 |
|  Mohegan Gaming & Entertainment |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 10/15/2024(a) | 15000 | 15114 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 2/1/2026(a) | 37000 | 31211 |
|  Penn Entertainment, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/15/2027(a) | 25000 | 22735 |
|  Raptor Acquisition Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 11/1/2026(a) | 12000 | 10590 |
|  Royal Caribbean Cruises Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 6/1/2025(a) | 13000 | 14001 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 7/1/2026(a) | 37000 | 29417 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/31/2026(a) | 12000 | 9811 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 7/15/2027(a) | 13000 | 10105 |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.63%, 8/15/2027(a) | 15000 | 14384 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/1/2028(a) | 19000 | 14630 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 1/15/2029(a) | 15000 | 15225 |
|  Six Flags Entertainment Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/31/2024(a) | 40000 | 38730 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2027(a) | 44000 | 39600 |
|  Sizzling Platter LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 11/28/2025(a) | 11000 | 9609 |
|  Speedway Motorsports LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 11/1/2027(a) | 12000 | 10426 |
|  Station Casinos LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/15/2028(a) | 19000 | 16368 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/1/2031(a) | 15000 | 11918 |
|  TKC Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/15/2028(a) | 12000 | 9960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 5/15/2029(a) | 19000 | 13491 |
|  Travel + Leisure Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.60%, 10/1/2025(d) | 12000 | 11731 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 7/31/2026(a) | 37000 | 36027 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/1/2029(a) | 19000 | 15485 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/1/2030(a) | 12000 | 9687 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 445

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** | **Hotels, Restaurants & Leisure – (continued)** |
|  Vail Resorts, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2025(a) | $| 25000 | $| 24875 |
|  Viking Cruises Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/15/2025(a) |  | 12000 |  | 10500 |
| &nbsp;&nbsp;&nbsp;&nbsp; 13.00%, 5/15/2025(a) |  | 19000 |  | 20425 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 9/15/2027(a) |  | 25000 |  | 19756 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 2/15/2029(a) |  | 25000 |  | 19834 |
|  VOC Escrow Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/15/2028(a) |  | 19000 |  | 15642 |
|  Wyndham Hotels & Resorts, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 8/15/2028(a) |  | 12000 |  | 10564 |
|  Wynn Las Vegas LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 3/1/2025(a) |  | 54000 |  | 51110 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/15/2027(a) |  | 28000 |  | 24354 |
|  Wynn Resorts Finance LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/15/2025(a) |  | 13000 |  | 12676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 10/1/2029(a) |  | 37000 |  | 29432 |
|  Yum! Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/1/2023 |  | 12000 |  | 11790 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2030(a) |  | 62000 |  | 55413 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2031 |  | 78000 |  | 62595 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/31/2032 |  | 81000 |  | 69257 |
|  |  |  |  | **1896333** |
| **Household Durables – 2.1%** | **Household Durables – 2.1%** | **Household Durables – 2.1%** | **Household Durables – 2.1%** | **Household Durables – 2.1%** |
|  Beazer Homes USA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 10/15/2027 |  | 19000 |  | 15960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 10/15/2029 |  | 12000 |  | 9930 |
|  Century Communities, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 6/1/2027 |  | 25000 |  | 23865 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2029(a) |  | 13000 |  | 10238 |
|  Empire Communities Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 12/15/2025(a) |  | 12000 |  | 10344 |
|  Installed Building Products, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 2/1/2028(a) |  | 6000 |  | 5303 |
|  KB Home |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 6/15/2027 |  | 43000 |  | 41590 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 7/15/2030 |  | 25000 |  | 23094 |
|  Newell Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2025 |  | 12000 |  | 11585 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 4/1/2026(d) |  | 123000 |  | 114458 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 4/1/2036(d) |  | 12000 |  | 9971 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/1/2046(d) |  | 23000 |  | 17698 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** | **Household Durables – (continued)** |
|  Shea Homes LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2028(a) | $| 12000 | $| 10122 |
|  Tempur Sealy International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 4/15/2029(a) |  | 50000 |  | 40208 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 10/15/2031(a) |  | 37000 |  | 27782 |
|  TopBuild Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2029(a) |  | 12000 |  | 9535 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 2/15/2032(a) |  | 13000 |  | 10179 |
|  TRI Pointe Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 6/15/2024 |  | 25000 |  | 24570 |
|  Tri Pointe Homes, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.70%, 6/15/2028 |  | 25000 |  | 21660 |
|  |  |  |  | **438092** |
| **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** |
|  Spectrum Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2029(a) |  | 37000 |  | 30340 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/15/2031(a) |  | 25000 |  | 18437 |
|  |  |  |  | **48777** |
| **Independent Power and Renewable Electricity<br>Producers – 1.1%** | **Independent Power and Renewable Electricity<br>Producers – 1.1%** | **Independent Power and Renewable Electricity<br>Producers – 1.1%** | **Independent Power and Renewable Electricity<br>Producers – 1.1%** | **Independent Power and Renewable Electricity<br>Producers – 1.1%** |
|  Calpine Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 6/1/2026(a) |  | 25000 |  | 23722 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 2/15/2028(a) |  | 37000 |  | 33252 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 3/15/2028(a) |  | 43000 |  | 38124 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 2/1/2029(a) |  | 37000 |  | 31088 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2031(a) |  | 44000 |  | 37177 |
|  Clearway Energy Operating LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/15/2028(a) |  | 25000 |  | 23092 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2031(a) |  | 44000 |  | 36740 |
|  |  |  |  | **223195** |
| **Insurance – 2.2%** | **Insurance – 2.2%** | **Insurance – 2.2%** | **Insurance – 2.2%** | **Insurance – 2.2%** |
|  Acrisure LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/15/2025(a) |  | 43000 |  | 40416 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2029(a) |  | 12000 |  | 9799 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 8/1/2029(a) |  | 25000 |  | 20725 |
|  Alliant Holdings Intermediate LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 10/15/2027(a) |  | 23000 |  | 20703 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/15/2027(a) |  | 58000 |  | 52925 |
|  AmWINS Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/30/2029(a) |  | 25000 |  | 21371 |
|  Assurant, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 3/27/2048(c) |  | 13000 |  | 12375 |

---

*See Accompanying Notes to the Financial Statements.* 

446 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** | **Insurance – (continued)** |
|  AssuredPartners, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 8/15/2025(a) | $| 17000 | $| 16289 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 1/15/2029(a) |  | 16000 |  | 13160 |
|  BroadStreet Partners, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/15/2029(a) |  | 22000 |  | 17657 |
|  Global Atlantic Fin Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 10/15/2051(a)(c) |  | 25000 |  | 18415 |
|  GTCR AP Finance, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 5/15/2027(a) |  | 13000 |  | 12385 |
|  HUB International Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 5/1/2026(a) |  | 62000 |  | 61225 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 12/1/2029(a) |  | 12000 |  | 10290 |
|  Liberty Mutual Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.80%, 3/15/2037(a) |  | 4000 |  | 4403 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 2/1/2061(a) |  | 43000 |  | 25332 |
|  NFP Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 8/15/2028(a) |  | 43000 |  | 37097 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 8/15/2028(a) |  | 50000 |  | 42484 |
|  Ryan Specialty Group LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/1/2030(a) |  | 12000 |  | 10260 |
|  USI, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 5/1/2025(a) |  | 12000 |  | 11640 |
|  |  |  |  | **458951** |
| **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** | **Interactive Media & Services – 0.4%** |
|  Twitter, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 12/15/2027(a) |  | 13000 |  | 13114 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2030(a) |  | 56000 |  | 56307 |
|  Ziff Davis, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 10/15/2030(a) |  | 19000 |  | 16059 |
|  |  |  |  | **85480** |
| **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** | **Internet & Direct Marketing Retail – 0.8%** |
|  Match Group Holdings II LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/1/2028(a) |  | 13000 |  | 11552 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 8/1/2030(a) |  | 50000 |  | 40850 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 10/1/2031(a) |  | 15000 |  | 11434 |
|  Photo Holdings Merger Sub, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/1/2026(a) |  | 23000 |  | 15136 |
|  QVC, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 2/15/2025 |  | 50000 |  | 43731 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 2/15/2027 |  | 16000 |  | 12676 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 8/15/2034 |  | 19000 |  | 11970 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 3/15/2043 |  | 10000 |  | 6100 |
|  |  |  |  | **153449** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **IT Services – 1.2%** | **IT Services – 1.2%** | **IT Services – 1.2%** |
|  Ahead DB Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/1/2028(a) | $11000 | $8933 |
|  Block, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 6/1/2026 | 50000 | 44592 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/1/2031 | 25000 | 20125 |
|  Endurance International Group Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/15/2029(a) | 17000 | 11349 |
|  Exela Intermediate LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 7/15/2026(a) | 30000 | 7950 |
|  Gartner, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 6/15/2029(a) | 93000 | 79050 |
|  Northwest Fiber LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 6/1/2028(a) | 6000 | 5632 |
|  Presidio Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/1/2028(a) | 27000 | 24030 |
|  Twilio, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2029 | 25000 | 20644 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/15/2031 | 19000 | 15495 |
|  Virtusa Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 12/15/2028(a) | 12000 | 8608 |
|  |  | **246408** |
| **Machinery – 0.4%** | **Machinery – 0.4%** | **Machinery – 0.4%** |
|  Hillenbrand, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 3/1/2031 | 45000 | 36000 |
|  JPW Industries Holding Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 10/1/2024(a) | 12000 | 10380 |
|  Manitowoc Co., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 4/1/2026(a) | 10000 | 9094 |
|  Terex Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/15/2029(a) | 12000 | 10705 |
|  Trinity Industries, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.55%, 10/1/2024 | 12000 | 11378 |
|  Weir Group plc (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 5/13/2026(a) | 5000 | 4278 |
|  |  | **81835** |
| **Media – 4.8%** | **Media – 4.8%** | **Media – 4.8%** |
|  Altice Financing SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 8/15/2029(a) | 5000 | 3924 |
|  Beasley Mezzanine Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.63%, 2/1/2026(a) | 12000 | 8610 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 447

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Cengage Learning, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 6/15/2024(a) | $12000 | $11347 |
|  Clear Channel Outdoor Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 8/15/2027(a) | 68000 | 61200 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/15/2028(a) | 37000 | 30194 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 6/1/2029(a) | 37000 | 29084 |
|  CMG Media Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.88%, 12/15/2027(a) | 43000 | 36443 |
|  CSC Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2030(a) | 30000 | 22950 |
|  Cumulus Media New Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 7/1/2026(a) | 12000 | 10152 |
|  Directv Financing LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 8/15/2027(a) | 44000 | 39626 |
|  DISH DBS Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 11/15/2024 | 13000 | 11983 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 7/1/2026 | 6000 | 5063 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 12/1/2026(a) | 37000 | 32144 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 12/1/2028(a) | 12000 | 9675 |
|  iHeartCommunications, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/1/2026 | 25000 | 23817 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.38%, 5/1/2027 | 31000 | 27847 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/15/2027(a) | 44000 | 40047 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2028(a) | 25000 | 21813 |
|  Lamar Media Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/15/2028 | 37000 | 32471 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/15/2030 | 37000 | 31417 |
|  Liberty Interactive LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/1/2030 | 19000 | 11861 |
|  McGraw-Hill Education, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 8/1/2029(a) | 23000 | 19579 |
|  News Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 5/15/2029(a) | 68000 | 58446 |
|  Nexstar Media, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 7/15/2027(a) | 12000 | 11334 |
|  Paramount Global |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/28/2057(c) | 23000 | 19257 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.37%, 3/30/2062(c) | 31000 | 26208 |
|  Sirius XM Radio, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 7/15/2028(a) | 19000 | 16334 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** | **Media – (continued)** |
|  Summer BC Bidco B LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 10/31/2026(a) | $| 5000 | $| 3979 |
|  TEGNA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/15/2026(a) |  | 25000 |  | 24285 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/15/2028 |  | 52000 |  | 49497 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/15/2029 |  | 38000 |  | 36028 |
|  Townsquare Media, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 2/1/2026(a) |  | 12000 |  | 11330 |
|  Univision Communications, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/15/2025(a) |  | 8000 |  | 7730 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 6/1/2027(a) |  | 7000 |  | 6913 |
|  UPC Broadband Finco BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/15/2031(a) |  | 35000 |  | 29391 |
|  UPC Holding BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) |  | 15000 |  | 13165 |
|  Virgin Media Vendor Financing Notes IV DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/15/2028(a) |  | 175000 |  | 148995 |
|  Ziggo Bond Co. BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/28/2030(a) |  | 3000 |  | 2377 |
|  |  |  |  | **986516** |
| **Metals & Mining – 1.7%** | **Metals & Mining – 1.7%** | **Metals & Mining – 1.7%** | **Metals & Mining – 1.7%** | **Metals & Mining – 1.7%** |
|  Baffinland Iron Mines Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 7/15/2026(a) |  | 13000 |  | 11810 |
|  Commercial Metals Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 1/15/2030 |  | 25000 |  | 21005 |
|  Eldorado Gold Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 9/1/2029(a) |  | 13000 |  | 10515 |
|  FMG Resources August 2006 Pty. Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 5/15/2024(a) |  | 25000 |  | 24382 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/15/2030(a) |  | 87000 |  | 78065 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/1/2031(a) |  | 87000 |  | 69148 |
|  Hudbay Minerals, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2026(a) |  | 23000 |  | 20177 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2029(a) |  | 25000 |  | 20688 |
|  IAMGOLD Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/15/2028(a) |  | 12000 |  | 8040 |
|  Mineral Resources Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 5/1/2027(a) |  | 19000 |  | 18905 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/1/2027(a) |  | 44000 |  | 43283 |
|  New Gold, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 7/15/2027(a) |  | 12000 |  | 10233 |

---

*See Accompanying Notes to the Financial Statements.* 

448 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** | **Metals & Mining – (continued)** |
|  Novelis Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2031(a) | $| 15000 | $| 11621 |
|  TMS International Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 4/15/2029(a) |  | 6000 |  | 4208 |
|  |  |  |  | **352080** |
| **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** | **Mortgage Real Estate Investment Trusts (REITs) – 0.3%** |
|  Apollo Commercial Real Estate Finance, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/15/2029(a) |  | 22000 |  | 17325 |
|  Rithm Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 10/15/2025(a) |  | 12000 |  | 10531 |
|  Starwood Property Trust, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 7/15/2026(a) |  | 13000 |  | 11310 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 1/15/2027(a) |  | 25000 |  | 22082 |
|  |  |  |  | **61248** |
| **Multiline Retail – 0.8%** | **Multiline Retail – 0.8%** | **Multiline Retail – 0.8%** | **Multiline Retail – 0.8%** | **Multiline Retail – 0.8%** |
|  Macy's Retail Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/1/2029(a) |  | 12000 |  | 10364 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 3/15/2030(a) |  | 37000 |  | 31064 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 3/15/2032(a) |  | 12000 |  | 9970 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/15/2034 |  | 25000 |  | 17113 |
|  Marks & Spencer plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 12/1/2037(a) |  | 3000 |  | 2584 |
|  Nordstrom, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 4/1/2030 |  | 37000 |  | 28397 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 8/1/2031 |  | 56000 |  | 40656 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/15/2044 |  | 31000 |  | 19611 |
|  |  |  |  | **159759** |
| **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** | **Multi-Utilities – 0.1%** |
|  Algonquin Power & Utilities Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/18/2082(c) |  | 31000 |  | 24962 |
| **Oil, Gas & Consumable Fuels – 9.5%** | **Oil, Gas & Consumable Fuels – 9.5%** | **Oil, Gas & Consumable Fuels – 9.5%** | **Oil, Gas & Consumable Fuels – 9.5%** | **Oil, Gas & Consumable Fuels – 9.5%** |
|  Aethon United BR LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 2/15/2026(a) |  | 22000 |  | 22340 |
|  Antero Midstream Partners LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2028(a) |  | 15000 |  | 14132 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 6/15/2029(a) |  | 13000 |  | 11860 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Apache Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 1/15/2030 | $13000 | $11566 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.10%, 9/1/2040 | 19000 | 15385 |
|  Ascent Resources Utica Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 11/1/2026(a) | 13000 | 12805 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.25%, 12/31/2028(a) | 31000 | 29915 |
|  Blue Racer Midstream LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 7/15/2026(a) | 12000 | 11400 |
|  Buckeye Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 10/15/2024 | 31000 | 29519 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 12/1/2026 | 12000 | 10526 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 3/1/2028(a) | 31000 | 26893 |
|  Calumet Specialty Products Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.00%, 4/15/2025(a) | 12000 | 12474 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 1/15/2027(a) | 25000 | 23661 |
|  Cheniere Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2029 | 44000 | 38850 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2031 | 42000 | 35409 |
|  Cheniere Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 10/15/2028 | 65000 | 59963 |
|  Citgo Holding, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 8/1/2024(a) | 40000 | 40037 |
|  CITGO Petroleum Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 6/15/2025(a) | 37000 | 36432 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2026(a) | 20000 | 19697 |
|  CQP Holdco LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 6/15/2031(a) | 38000 | 33725 |
|  Crestwood Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 5/1/2027(a) | 31000 | 29158 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 2/1/2029(a) | 19000 | 17767 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 4/1/2029(a) | 15000 | 15000 |
|  CrownRock LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 10/15/2025(a) | 13000 | 12573 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 5/1/2029(a) | 37000 | 33612 |
|  Delek Logistics Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 6/1/2028(a) | 12000 | 10745 |
|  DT Midstream, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 6/15/2031(a) | 25000 | 21062 |
|  Encino Acquisition Partners Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 5/1/2028(a) | 12000 | 11243 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 449

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index

Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Endeavor Energy Resources LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/30/2028(a) | $25000 | $24299 |
|  Energean plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 4/30/2027(a) | 5000 | 4417 |
|  Energy Ventures Gom LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.75%, 4/15/2026(a) | 12000 | 12322 |
|  Enviva Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 1/15/2026(a) | 37000 | 35528 |
|  FTAI Infra Escrow Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.50%, 6/1/2027(a) | 19000 | 18629 |
|  Genesis Energy LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 1/15/2027 | 56000 | 54210 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 2/1/2028 | 34000 | 32428 |
|  Harvest Midstream I LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/1/2028(a) | 23000 | 22051 |
|  Hess Midstream Operations LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2026(a) | 25000 | 24519 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 6/15/2028(a) | 25000 | 23000 |
|  Hilcorp Energy I LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 11/1/2028(a) | 54000 | 50760 |
|  Holly Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 4/15/2027(a) | 25000 | 24062 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 2/1/2028(a) | 12000 | 10845 |
|  Howard Midstream Energy Partners LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 1/15/2027(a) | 10000 | 9073 |
|  ITT Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 8/1/2029(a) | 51000 | 40979 |
|  Martin Midstream Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 11.50%, 2/28/2025(a) | 6000 | 5820 |
|  MEG Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 2/1/2027(a) | 69000 | 70211 |
|  Moss Creek Resources Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 1/15/2026(a) | 35000 | 32200 |
|  Neptune Energy Bondco plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 5/15/2025(a) | 10000 | 9713 |
|  New Fortress Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 9/15/2025(a) | 19000 | 18652 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 9/30/2026(a) | 19000 | 18430 |
|  NGL Energy Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 2/1/2026(a) | 62000 | 56088 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  NGL Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 11/1/2023 | $13000 | $12675 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 3/1/2025 | 13000 | 10140 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2026 | 10000 | 7288 |
|  Northriver Midstream Finance LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/15/2026(a) | 12000 | 11360 |
|  NuStar Logistics LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/1/2025 | 44000 | 42426 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 10/1/2030 | 44000 | 40779 |
|  Occidental Petroleum Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.95%, 7/1/2024 | 55000 | 56354 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 9/1/2030 | 43000 | 44722 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.45%, 9/15/2036 | 45000 | 44639 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.60%, 3/15/2046 | 30000 | 29529 |
|  Parkland Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 10/1/2029(a) | 37000 | 31153 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 5/1/2030(a) | 56000 | 46582 |
|  Rockies Express Pipeline LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 7/15/2029(a) | 35000 | 30705 |
|  Strathcona Resources Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 8/1/2026(a) | 12000 | 10160 |
|  Summit Midstream Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 4/15/2025 | 12000 | 10050 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 10/15/2026(a) | 19000 | 18240 |
|  Sunnova Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 9/1/2026(a) | 23000 | 20240 |
|  Sunoco LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 4/15/2027 | 31000 | 30374 |
|  Tallgrass Energy Partners LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 10/1/2025(a) | 18000 | 18179 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2028(a) | 24000 | 21520 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 12/31/2030(a) | 37000 | 33493 |
|  Tap Rock Resources LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 10/1/2026(a) | 12000 | 11204 |
|  Teine Energy Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 4/15/2029(a) | 12000 | 10704 |
|  TerraForm Power Operating LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/31/2028(a) | 25000 | 23159 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/15/2030(a) | 19000 | 17076 |
|  Western Midstream Operating LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 2/1/2030(d) | 75000 | 65985 |
|  |  | **1944721** |

---

*See Accompanying Notes to the Financial Statements.* 

450 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Paper & Forest Products – 0.4%** | **Paper & Forest Products – 0.4%** | **Paper & Forest Products – 0.4%** |
|  Domtar Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/1/2028(a) | $13000 | $11046 |
|  Louisiana-Pacific Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/15/2029(a) | 12000 | 9758 |
|  Mercer International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 1/15/2026 | 13000 | 12179 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 2/1/2029 | 43000 | 35314 |
|  Sylvamo Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 9/1/2029(a) | 19000 | 17656 |
|  |  | **85953** |
| **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** |
|  Avon Products, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.45%, 3/15/2043(d) | 7000 | 6317 |
|  Coty, Inc.<br>5.00%, 4/15/2026(a) | 44000 | 41264 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 4/15/2026(a) | 43000 | 40949 |
|  Herbalife Nutrition Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 9/1/2025(a) | 20000 | 18670 |
|  |  | **107200** |
| **Pharmaceuticals – 1.5%** | **Pharmaceuticals – 1.5%** | **Pharmaceuticals – 1.5%** |
|  Bausch Health Americas, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.25%, 4/1/2026(a) | 27000 | 15609 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.50%, 1/31/2027(a) | 22000 | 9529 |
|  Bausch Health Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/1/2025(a) | 69000 | 55130 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 12/15/2025(a) | 62000 | 39868 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 2/1/2027(a) | 43000 | 28227 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 1/30/2028(a) | 19000 | 7367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2028(a) | 68000 | 41650 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/15/2029(a) | 44000 | 17160 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.25%, 5/30/2029(a) | 31000 | 11847 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 1/30/2030(a) | 44000 | 17050 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 2/15/2031(a) | 43000 | 16877 |
|  HLF Financing Sarl LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2029(a) | 19000 | 14112 |
|  Lannett Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/15/2026(a) | 3000 | 934 |
|  Organon & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/30/2031(a) | 25000 | 21232 |
|  P&L Development LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 11/15/2025(a) | 12000 | 9263 |
|  |  | **305855** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Professional Services – 0.1%** | **Professional Services – 0.1%** | **Professional Services – 0.1%** |
|  CoreLogic, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/1/2028(a) | $22000 | $14799 |
|  Korn Ferry |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 12/15/2027(a) | 12000 | 10916 |
|  |  | **25715** |
| **Real Estate Management & Development – 1.2%** | **Real Estate Management & Development – 1.2%** | **Real Estate Management & Development – 1.2%** |
|  Cushman & Wakefield US Borrower LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 5/15/2028(a) | 19000 | 18068 |
|  Howard Hughes Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.38%, 8/1/2028(a) | 47000 | 40206 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 2/1/2031(a) | 37000 | 27802 |
|  Kennedy-Wilson, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/1/2029 | 37000 | 30005 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/1/2031 | 31000 | 24304 |
|  Realogy Group LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 1/15/2029(a) | 37000 | 26594 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2030(a) | 56000 | 38831 |
|  WeWork Cos. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 7/10/2025(a) | 43000 | 21500 |
|  WeWork Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/1/2025(a) | 19000 | 10368 |
|  |  | **237678** |
| **Road & Rail – 1.2%** |  |  |
|  Albion Financing 1 Sarl |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 10/15/2026(a) | 25000 | 21345 |
|  Albion Financing 2SARL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.75%, 4/15/2027(a) | 6000 | 5040 |
|  Avis Budget Car Rental LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/1/2028(a) | 13000 | 11421 |
|  PECF USS Intermediate<br>Holding III Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.00%, 11/15/2029(a) | 13000 | 8705 |
|  Uber Technologies, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 5/15/2025(a) | 37000 | 37018 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/15/2027(a) | 75000 | 74983 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2028(a) | 12000 | 11400 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 8/15/2029(a) | 62000 | 53146 |
|  XPO CNW, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.70%, 5/1/2034 | 12000 | 10740 |
|  XPO Logistics, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 5/1/2025(a) | 19000 | 19194 |
|  |  | **252992** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 451

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Semiconductors & Semiconductor Equipment – 0.4%** | **Semiconductors & Semiconductor Equipment – 0.4%** | **Semiconductors & Semiconductor Equipment – 0.4%** |
|  Entegris, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 5/1/2029(a) | $75000 | $61189 |
|  ON Semiconductor Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/1/2028(a) | 13000 | 11454 |
|  |  | **72643** |
| **Software – 3.6%** | **Software – 3.6%** | **Software – 3.6%** |
|  AthenaHealth Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2030(a) | 12000 | 9360 |
|  Boxer Parent Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 10/2/2025(a) | 17000 | 16705 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.13%, 3/1/2026(a) | 10000 | 9551 |
|  Camelot Finance SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 11/1/2026(a) | 22000 | 20554 |
|  Castle US Holding Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.50%, 2/15/2028(a) | 6000 | 2722 |
|  Clarivate Science Holdings Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 7/1/2028(a) | 19000 | 16294 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/1/2029(a) | 44000 | 36685 |
|  Condor Merger Sub, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 2/15/2030(a) | 62000 | 51279 |
|  Crowdstrike Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 2/15/2029 | 33000 | 27816 |
|  Elastic NV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 7/15/2029(a) | 25000 | 20873 |
|  GoTo Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/1/2027(a) | 25000 | 14493 |
|  NCR Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 9/1/2027(a) | 13000 | 12545 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 10/1/2028(a) | 13000 | 10924 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 4/15/2029(a) | 56000 | 46999 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 9/1/2029(a) | 12000 | 11437 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 10/1/2030(a) | 13000 | 10497 |
|  NortonLifeLock, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 4/15/2025(a) | 10000 | 9704 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 9/30/2027(a) | 50000 | 49290 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 9/30/2030(a) | 50000 | 49150 |
|  Open Text Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 2/15/2028(a) | 50000 | 42797 |
|  Open Text Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 2/15/2030(a) | 62000 | 49367 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 12/1/2031(a) | 44000 | 33110 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Picard Midco, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 3/31/2029(a) | $| 45000 | $| 39023 |
|  PTC, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 2/15/2025(a) |  | 15000 |  | 14295 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/15/2028(a) |  | 13000 |  | 11775 |
|  Rocket Software, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 2/15/2029(a) |  | 17000 |  | 13571 |
|  SS&C Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 9/30/2027(a) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;68000 |  | 63226 |
|  Veritas US, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 9/1/2025(a) |  | 56000 |  | 47143 |
|  |  |  |  | **741185** |
| **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** | **Specialty Retail – 2.9%** |
|  99 Escrow Issuer, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 1/15/2026(a) |  | 12000 |  | 6839 |
|  At Home Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/15/2028(a) |  | 12000 |  | 8725 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 7/15/2029(a) |  | 12000 |  | 6780 |
|  Bath & Body Works, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.38%, 7/1/2025(a) |  | 25000 |  | 25937 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 2/1/2028 |  | 13000 |  | 11499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.63%, 10/1/2030(a) |  | 62000 |  | 55466 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 11/1/2035 |  | 44000 |  | 36960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 7/1/2036 |  | 25000 |  | 20656 |
|  BCPE Ulysses Intermediate, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 4/1/2027(a)(b) |  | 12000 |  | 7947 |
|  Carvana Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.25%, 5/1/2030(a) |  | 31000 |  | 18600 |
|  Foot Locker, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 10/1/2029(a) |  | 12000 |  | 9174 |
|  Gap, Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 10/1/2029(a) |  | 19000 |  | 13314 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 10/1/2031(a) |  | 44000 |  | 30360 |
|  LBM Acquisition LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 1/15/2029(a) |  | 37000 |  | 25881 |
|  Lithia Motors, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 6/1/2029(a) |  | 62000 |  | 49953 |
|  LSF9 Atlantis Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.75%, 2/15/2026(a) |  | 23000 |  | 20754 |
|  Michaels Cos., Inc. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 5/1/2029(a) |  | 12000 |  | 6690 |
|  Park River Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 2/1/2029(a) |  | 37000 |  | 23494 |

---

*See Accompanying Notes to the Financial Statements.* 

452 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** | **Specialty Retail – (continued)** |
|  Penske Automotive Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 6/15/2029 | $| 50000 | $| 41047 |
|  Specialty Building Products<br>Holdings LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 9/30/2026(a) |  | 22000 |  | 17673 |
|  SRS Distribution, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 7/1/2028(a) |  | 20000 |  | 17561 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 7/1/2029(a) |  | 38000 |  | 30900 |
|  Staples, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 4/15/2026(a) |  | 62000 |  | 53852 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 4/15/2027(a) |  | 31000 |  | 22576 |
|  White Cap Buyer LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.88%, 10/15/2028(a) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37000 |  | 31357 |
|  |  |  |  | **593995** |
| **Technology Hardware, Storage & Peripherals – 1.1%** | **Technology Hardware, Storage & Peripherals – 1.1%** | **Technology Hardware, Storage & Peripherals – 1.1%** | **Technology Hardware, Storage & Peripherals – 1.1%** | **Technology Hardware, Storage & Peripherals – 1.1%** |
|  Seagate HDD Cayman | Seagate HDD Cayman | Seagate HDD Cayman | Seagate HDD Cayman | Seagate HDD Cayman |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/1/2027 |  | 75000 |  | 69353 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 1/15/2031 |  | 100000 |  | 75200 |
|  Xerox Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 12/15/2039 |  | 28000 |  | 20523 |
|  Xerox Holdings Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 8/15/2025(a) |  | 25000 |  | 22571 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 8/15/2028(a) |  | 35000 |  | 27650 |
|  |  |  |  | **215297** |
| **Textiles, Apparel & Luxury Goods – 0.4%** | **Textiles, Apparel & Luxury Goods – 0.4%** | **Textiles, Apparel & Luxury Goods – 0.4%** | **Textiles, Apparel & Luxury Goods – 0.4%** | **Textiles, Apparel & Luxury Goods – 0.4%** |
|  Eagle Intermediate Global Holding BV | Eagle Intermediate Global Holding BV | Eagle Intermediate Global Holding BV | Eagle Intermediate Global Holding BV | Eagle Intermediate Global Holding BV |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.50%, 5/1/2025(a) |  | 5000 |  | 3850 |
|  Hanesbrands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 5/15/2026(a) |  | 44000 |  | 40370 |
|  Under Armour, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 6/15/2026 |  | 23000 |  | 19837 |
|  William Carter Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 3/15/2027(a) |  | 19000 |  | 18063 |
|  |  |  |  | **82120** |
| **Thrifts & Mortgage Finance – 1.4%** | **Thrifts & Mortgage Finance – 1.4%** | **Thrifts & Mortgage Finance – 1.4%** | **Thrifts & Mortgage Finance – 1.4%** | **Thrifts & Mortgage Finance – 1.4%** |
|  Freedom Mortgage Corp. | Freedom Mortgage Corp. | Freedom Mortgage Corp. | Freedom Mortgage Corp. | Freedom Mortgage Corp. |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 11/15/2024(a) |  | 50000 |  | 43988 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 5/1/2026(a) |  | 25000 |  | 19751 |
|  Ladder Capital Finance Holdings LLLP | Ladder Capital Finance Holdings LLLP | Ladder Capital Finance Holdings LLLP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; REIT, 5.25%, 10/1/2025(a) |  | 13000 |  | 11989 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** | **Thrifts & Mortgage Finance – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; REIT, 4.25%, 2/1/2027(a) | $| 31000 | $| 26036 |
| &nbsp;&nbsp;&nbsp;&nbsp; REIT, 4.75%, 6/15/2029(a) |  | 19000 |  | 15123 |
|  LD Holdings Group LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.13%, 4/1/2028(a) |  | 20000 |  | 11200 |
|  MGIC Investment Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 8/15/2028 |  | 31000 |  | 28124 |
|  NMI Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.38%, 6/1/2025(a) |  | 10000 |  | 9990 |
|  PHH Mortgage Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 3/15/2026(a) |  | 12000 |  | 9960 |
|  Provident Funding Associates LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 6/15/2025(a) |  | 13000 |  | 11310 |
|  Rocket Mortgage LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 10/15/2026(a) |  | 37000 |  | 30874 |
|  United Wholesale Mortgage LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 11/15/2025(a) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37000 |  | 33410 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/15/2027(a) |  | 19000 |  | 15570 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/15/2029(a) |  | 19000 |  | 14334 |
|  |  |  |  | **281659** |
| **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** | **Trading Companies & Distributors – 1.1%** |
|  Boise Cascade Co. | Boise Cascade Co. | Boise Cascade Co. | Boise Cascade Co. | Boise Cascade Co. |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 7/1/2030(a) |  | 12000 |  | 10039 |
|  Fortress Transportation and Infrastructure Investors LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.50%, 10/1/2025(a) |  | 25000 |  | 23991 |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.75%, 8/1/2027(a) |  | 56000 |  | 57013 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/1/2028(a) |  | 12000 |  | 10033 |
|  Foundation Building Materials, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 3/1/2029(a) |  | 12000 |  | 8290 |
|  Imola Merger Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2029(a) |  | 68000 |  | 58630 |
|  United Rentals North America, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 5/15/2027 |  | 13000 |  | 12684 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 1/15/2028 |  | 44000 |  | 40920 |
|  WESCO Distribution, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 6/15/2025(a) |  | 6000 |  | 6058 |
|  |  |  |  | **227658** |
| **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** | **Wireless Telecommunication Services – 2.0%** |
|  Ligado Networks LLC | Ligado Networks LLC | Ligado Networks LLC | Ligado Networks LLC | Ligado Networks LLC |
| &nbsp;&nbsp;&nbsp;&nbsp; 15.50%, 11/1/2023(a)(b)(e) |  | 110858 |  | 37362 |
| &nbsp;&nbsp;&nbsp;&nbsp; 17.50%, 5/1/2024(a)(b) |  | 31246 |  | 5017 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 453

------

##### [**Table of Contents**](#toc)

------

FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** | **Wireless Telecommunication Services – (continued)** |
|  Sprint Corp. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.13%, 6/15/2024 | $| 100000 | $101095 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 2/15/2025 |  | 43000 | 44183 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.63%, 3/1/2026 |  | 25000 | 26094 |
|  Vmed O2 UK Financing I plc |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 7/15/2031(a) |  | 35000 | 28282 |
|  Vodafone Group plc |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.00%, 4/4/2079(c) |  | 144000 | 136800 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.12%, 6/4/2081(c) |  | 56000 | 38698 |
|  |  |  | **417531** |
| **Total Corporate Bonds <br>(Cost $20,125,816)** |  |  | **19887403** |
| **Total Investments – 97.3% <br>(Cost $20,125,816)** | **Total Investments – 97.3% <br>(Cost $20,125,816)** | **Total Investments – 97.3% <br>(Cost $20,125,816)** | **19887403** |
|  Other assets less liabilities – 2.7% | Other assets less liabilities – 2.7% | Other assets less liabilities – 2.7% | 544438 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**20431841** |

---

*<sup>(a)</sup>* *Securities exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. The value of these securities is determined by valuations supplied by a pricing service or brokers, or, if not available, in accordance with procedures established by the Board of Trustees.* 

*<sup>(b)</sup>* *Payment in-kind security.* 

*<sup>(c)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(d)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*<sup>(e)</sup>* *Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $105405 |
|  Aggregate gross unrealized depreciation | (428744) |
|  Net unrealized depreciation | $(323339) |
|  Federal income tax cost | $20210742 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 97.3% |
|  Others<sup>(1)</sup> | 2.7 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

454 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments
FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund

October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 94.9%** | **CORPORATE BONDS – 94.9%** | **CORPORATE BONDS – 94.9%** |
| **Air Freight & Logistics – 0.3%** | **Air Freight & Logistics – 0.3%** | **Air Freight & Logistics – 0.3%** |
|  United Parcel Service, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.30%, 4/1/2050 | $80000 | $78288 |
| **Automobiles – 0.8%** |  |  |
|  General Motors Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.80%, 10/1/2027 | 150000 | 151978 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 4/1/2049 | 45000 | 38099 |
|  |  | **190077** |
| **Banks – 17.0%** |  |  |
|  Banco Santander SA | Banco Santander SA | Banco Santander SA |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.17%, 3/24/2028(a) | 200000 | 176298 |
|  Bank of America Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.46%, 3/15/2025(a) | 150000 | 144645 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.73%, 7/22/2027(a) | 150000 | 128271 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.42%, 12/20/2028(a) | 200000 | 176552 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.27%, 7/23/2029(a) | 150000 | 136137 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.69%, 4/22/2032(a) | 140000 | 108199 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.68%, 6/19/2041(a) | 65000 | 41124 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.97%, 7/21/2052(a) | 35000 | 20795 |
|  Bank of Montreal |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.09%, 1/10/2037(a) | 50000 | 36683 |
|  Citigroup, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 4/24/2025(a) | 200000 | 192045 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.11%, 4/8/2026(a) | 150000 | 140012 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 10/21/2026 | 100000 | 91066 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 9/29/2027 | 100000 | 92817 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.98%, 3/20/2030(a) | 100000 | 88109 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.41%, 3/31/2031(a) | 150000 | 133855 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.57%, 6/3/2031(a) | 110000 | 86018 |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.13%, 7/15/2039 | 45000 | 51903 |
|  HSBC Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.98%, 5/24/2025(a) | 150000 | 136221 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.59%, 5/24/2027(a) | 200000 | 164356 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.76%, 3/29/2033(a) | 200000 | 159900 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.40%, 8/11/2033(a) | 250000 | 216747 |
|  JPMorgan Chase & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 9/10/2024 | 150000 | 146115 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.58%, 4/22/2027(a) | 150000 | 129008 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.78%, 2/1/2028(a) | 150000 | 137032 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 12/5/2029(a) | 150000 | 136806 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.74%, 10/15/2030(a) | 60000 | 48407 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Banks – (continued)** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.58%, 4/22/2032(a) | $20000 | $15378 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.60%, 7/15/2041 | 75000 | 70331 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.63%, 8/16/2043 | 25000 | 22448 |
|  Mitsubishi UFJ Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.13%, 7/20/2033(a) | 200000 | 181545 |
|  PNC Financial Services Group, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 6/6/2033(a) | 75000 | 66329 |
|  Royal Bank of Canada |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 7/16/2024 | 75000 | 71535 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.15%, 6/10/2025 | 150000 | 134714 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 5/4/2027 | 75000 | 69187 |
|  Santander Holdings USA, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 6/2/2025 | 80000 | 74697 |
|  Toronto-Dominion Bank (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.46%, 6/8/2032 | 115000 | 103349 |
|  |  | **3928634** |
| **Beverages – 2.4%** |  |  |
|  Anheuser-Busch Cos. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 2/1/2036 | 50000 | 45192 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 2/1/2046 | 150000 | 128651 |
|  Anheuser-Busch InBev Worldwide, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 1/23/2029 | 75000 | 72954 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.55%, 1/23/2049 | 85000 | 80050 |
|  Diageo Capital plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 9/30/2036 | 25000 | 25179 |
|  PepsiCo, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 3/19/2025 | 15000 | 14131 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 7/29/2029 | 75000 | 64919 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/19/2040 | 150000 | 116770 |
|  |  | **547846** |
| **Biotechnology – 1.0%** |  |  |
|  Amgen, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 2/21/2025 | 25000 | 23303 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 8/15/2041 | 40000 | 26767 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.66%, 6/15/2051 | 150000 | 123867 |
|  Biogen, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 5/1/2050 | 50000 | 30846 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 455

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##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Biotechnology – (continued)** |  |  |
|  Regeneron Pharmaceuticals, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 9/15/2030 | $50000 | $37669 |
|  |  | **242452** |
| **Building Products – 0.4%** |  |  |
|  Carrier Global Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 4/5/2040 | 75000 | 53539 |
|  Owens Corning |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 7/15/2047 | 40000 | 28151 |
|  |  | **81690** |
| **Capital Markets – 7.3%** |  |  |
|  Bank of New York Mellon Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 1/29/2028 | 100000 | 90965 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.29%, 6/13/2033(a) | 30000 | 26853 |
|  Blackstone Private Credit Fund |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 12/15/2026 | 50000 | 41041 |
|  Blackstone Secured Lending Fund |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 2/15/2027 | 75000 | 60532 |
|  Deutsche Bank AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/18/2031(a) | 150000 | 111632 |
|  FS KKR Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 1/15/2027 | 50000 | 40280 |
|  Goldman Sachs Group, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 4/1/2025 | 150000 | 142121 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 7/21/2032(a) | 25000 | 18604 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 2/24/2033(a) | 35000 | 27412 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 10/1/2037 | 75000 | 74152 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.25%, 2/1/2041 | 40000 | 39160 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 5/22/2045 | 75000 | 60868 |
|  Moody's Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 2/25/2052 | 50000 | 35308 |
|  Morgan Stanley | Morgan Stanley |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series F,<br>3.88%, 4/29/2024 | 150000 | 146906 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 7/27/2026 | 150000 | 136887 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.98%, 12/10/2026(a) | 40000 | 34230 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 1/22/2031(a) | 200000 | 160150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.24%, 7/21/2032(a) | 45000 | 33172 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.60%, 3/24/2051(a) | 50000 | 46098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 1/25/2052(a) | 60000 | 35112 |
|  Nasdaq, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/30/2026 | 75000 | 71404 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Capital Markets – (continued)** |  |  |  |  |
|  Owl Rock Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 1/15/2027 | $| 50000 | $| 40030 |
|  S&P Global, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 8/15/2030 |  | 75000 |  | 55742 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 3/1/2032(b) |  | 75000 |  | 61688 |
|  State Street Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 3/30/2026(a) |  | 75000 |  | 70480 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 1/24/2030 |  | 45000 |  | 36744 |
|  |  |  |  | **1697571** |
| **Chemicals – 0.4%** |  |  |  |  |
|  Ecolab, Inc. | Ecolab, Inc. | Ecolab, Inc. | Ecolab, Inc. | Ecolab, Inc. |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 3/24/2030 |  | 50000 |  | 48389 |
|  International Flavors & Fragrances, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 9/26/2048 |  | 15000 |  | 11975 |
|  Sherwin-Williams Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 8/15/2029 |  | 50000 |  | 42368 |
|  |  |  |  | **102732** |
| **Commercial Services & Supplies – 0.0%(c)** | **Commercial Services & Supplies – 0.0%(c)** | **Commercial Services & Supplies – 0.0%(c)** | **Commercial Services & Supplies – 0.0%(c)** | **Commercial Services & Supplies – 0.0%(c)** |
|  Waste Management, Inc. | Waste Management, Inc. | Waste Management, Inc. | Waste Management, Inc. | Waste Management, Inc. |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 3/1/2045 |  | 10000 |  | 8046 |
| **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** | **Communications Equipment – 0.3%** |
|  Cisco Systems, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.90%, 2/15/2039 |  | 75000 |  | 76561 |
| **Consumer Finance – 2.4%** | **Consumer Finance – 2.4%** | **Consumer Finance – 2.4%** | **Consumer Finance – 2.4%** | **Consumer Finance – 2.4%** |
|  American Express Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 5/20/2026 |  | 75000 |  | 69391 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 5/3/2027 |  | 75000 |  | 67938 |
|  Capital One Financial Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.27%, 3/1/2030(a) |  | 45000 |  | 36931 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.27%, 5/10/2033(a) |  | 50000 |  | 44627 |
|  Caterpillar Financial Services Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.95%, 1/10/2024 |  | 75000 |  | 71601 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.10%, 9/14/2027 |  | 100000 |  | 83363 |
|  General Motors Financial Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 1/12/2032 |  | 100000 |  | 76107 |
|  Synchrony Financial |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 3/19/2024 |  | 75000 |  | 73321 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 10/28/2031 |  | 35000 |  | 24606 |
|  |  |  |  | **547885** |

---

*See Accompanying Notes to the Financial Statements.* 

456 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Containers & Packaging – 0.3%** |  |  |  |  |
|  International Paper Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 11/15/2041 | $| 50000 | $| 46596 |
|  Packaging Corp. of America |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 10/1/2051 |  | 20000 |  | 12088 |
|  |  |  |  | **58684** |
| **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** | **Diversified Financial Services – 1.1%** |
|  Corebridge Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 4/5/2042(b) |  | 35000 |  | 26237 |
|  Shell International Finance BV |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 11/13/2028 |  | 75000 |  | 70047 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 12/15/2038 |  | 75000 |  | 79116 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 5/11/2045 |  | 100000 |  | 82705 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 4/6/2050 |  | 5000 |  | 3436 |
|  |  |  |  | **261541** |
| **Diversified Telecommunication Services – 5.7%** | **Diversified Telecommunication Services – 5.7%** | **Diversified Telecommunication Services – 5.7%** | **Diversified Telecommunication Services – 5.7%** | **Diversified Telecommunication Services – 5.7%** |
|  AT&T, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 3/1/2029 |  | 150000 |  | 139425 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 2/15/2030 |  | 150000 |  | 136763 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/1/2041 |  | 75000 |  | 52988 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 9/15/2053 |  | 95000 |  | 60974 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 9/15/2055 |  | 25000 |  | 15909 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 12/1/2057 |  | 75000 |  | 49423 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 9/15/2059 |  | 75000 |  | 47310 |
|  Orange SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.00%, 3/1/2031(d) |  | 75000 |  | 89600 |
|  Verizon Communications, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/16/2027 |  | 150000 |  | 142623 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.33%, 9/21/2028 |  | 150000 |  | 140620 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 3/21/2031 |  | 150000 |  | 118534 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.36%, 3/15/2032 |  | 100000 |  | 75753 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 11/20/2040 |  | 150000 |  | 95214 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/22/2041 |  | 115000 |  | 81763 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.86%, 8/21/2046 |  | 75000 |  | 62593 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 3/22/2051 |  | 25000 |  | 16875 |
|  |  |  |  | **1326367** |
| **Electric Utilities – 3.7%** | **Electric Utilities – 3.7%** | **Electric Utilities – 3.7%** | **Electric Utilities – 3.7%** | **Electric Utilities – 3.7%** |
|  Commonwealth Edison Co. | Commonwealth Edison Co. | Commonwealth Edison Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/1/2050 |  | 50000 |  | 31783 |
|  Connecticut Light and Power Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A,<br>2.05%, 7/1/2031 |  | 75000 |  | 58531 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** | **Electric Utilities – (continued)** |
|  Edison International | Edison International |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 3/15/2028 | 225000 | $| 200106 |
|  Eversource Energy | Eversource Energy |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 1/15/2050 | 45000 |  | 29972 |
|  Exelon Corp. | Exelon Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 3/15/2027(b) | 150000 |  | 134103 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 6/15/2035 | 75000 |  | 67532 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 4/15/2046 | 50000 |  | 39195 |
|  Potomac Electric Power Co. | Potomac Electric Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 3/15/2024 | 75000 |  | 73536 |
|  Southern California Edison Co. | Southern California Edison Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 4.13%, 3/1/2048 | 50000 |  | 36368 |
|  Virginia Electric and Power Co. | Virginia Electric and Power Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 3.75%, 5/15/2027 | 150000 |  | 140685 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 4.63%, 5/15/2052 | 40000 |  | 33201 |
|  |  |  | **845012** |
| **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** | **Energy Equipment & Services – 0.4%** |
|  Baker Hughes Holdings LLC | Baker Hughes Holdings LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.08%, 12/15/2047 | 30000 |  | 21739 |
|  Halliburton Co. | Halliburton Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.92%, 3/1/2030 | 15000 |  | 12615 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.85%, 11/15/2035 | 75000 |  | 66257 |
|  |  |  | **100611** |
| **Equity Real Estate Investment Trusts (REITs) – 4.4%** | **Equity Real Estate Investment Trusts (REITs) – 4.4%** | **Equity Real Estate Investment Trusts (REITs) – 4.4%** | **Equity Real Estate Investment Trusts (REITs) – 4.4%** |
|  Alexandria Real Estate Equities, Inc. | Alexandria Real Estate Equities, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 12/15/2029 | 150000 |  | 121661 |
|  AvalonBay Communities, Inc. | AvalonBay Communities, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 5/11/2026 | 150000 |  | 136833 |
|  Boston Properties LP | Boston Properties LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 1/30/2031 | 75000 |  | 59747 |
|  Equinix, Inc. | Equinix, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 11/18/2029 | 75000 |  | 62819 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 2/15/2052 | 50000 |  | 31482 |
|  ERP Operating LP | ERP Operating LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/1/2044 | 30000 |  | 24015 |
|  Healthpeak Properties, Inc. | Healthpeak Properties, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 2/1/2027 | 75000 |  | 63082 |
|  Host Hotels & Resorts LP | Host Hotels & Resorts LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series F, 4.50%, 2/1/2026 | 75000 |  | 70011 |
|  Kilroy Realty LP | Kilroy Realty LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 10/1/2025 | 75000 |  | 71420 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 457

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** | **Equity Real Estate Investment Trusts (REITs) – (continued)** |
|  Kimco Realty Corp. | Kimco Realty Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 12/1/2031 | 75000 | $| 55215 |
|  Prologis LP | Prologis LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 1/15/2033 | 20000 |  | 18520 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 4/15/2050 | 35000 |  | 22010 |
|  Simon Property Group LP | Simon Property Group LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 2/1/2032 | 75000 |  | 56999 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.75%, 2/1/2040 | 25000 |  | 24836 |
|  UDR, Inc. | UDR, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 1/15/2030 | 75000 |  | 62001 |
|  Ventas Realty LP | Ventas Realty LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/1/2028 | 80000 |  | 72294 |
|  Weyerhaeuser Co. | Weyerhaeuser Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 3/9/2033 | 75000 |  | 59872 |
|  |  |  | **1012817** |
| **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** | **Food & Staples Retailing – 1.3%** |
|  Kroger Co. (The) | Kroger Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 1/15/2050 | 55000 |  | 39792 |
|  Walgreens Boots Alliance, Inc. | Walgreens Boots Alliance, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 6/1/2026 | 75000 |  | 70215 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 4/15/2050 | 15000 |  | 10356 |
|  Walmart, Inc. | Walmart, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.80%, 9/22/2031 | 150000 |  | 118628 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 9/22/2041 | 30000 |  | 20652 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 6/29/2048 | 40000 |  | 33422 |
|  |  |  | **293065** |
| **Food Products – 2.1%** | **Food Products – 2.1%** | **Food Products – 2.1%** | **Food Products – 2.1%** |
|  Bunge Ltd. Finance Corp. | Bunge Ltd. Finance Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.63%, 8/17/2025 | 75000 |  | 67138 |
|  Campbell Soup Co. | Campbell Soup Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 3/15/2028 | 75000 |  | 70348 |
|  General Mills, Inc. | General Mills, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 4/15/2030 | 75000 |  | 63368 |
|  Hormel Foods Corp. | Hormel Foods Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.65%, 6/3/2024 | 75000 |  | 70050 |
|  Ingredion, Inc. | Ingredion, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 6/1/2030 | 50000 |  | 40865 |
|  Kellogg Co. | Kellogg Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 12/1/2023 | 75000 |  | 73514 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.10%, 6/1/2030 | 75000 |  | 58919 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  Mondelez International, Inc. | Mondelez International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 9/4/2050 | 75000 | $| 43397 |
|  |  |  | **487599** |
| **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** | **Gas Utilities – 0.5%** |
|  Atmos Energy Corp. | Atmos Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 10/15/2052 | 25000 |  | 24242 |
|  Southern California Gas Co. | Southern California Gas Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 4/15/2027 | 100000 |  | 90392 |
|  |  |  | **114634** |
| **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** | **Health Care Equipment & Supplies – 1.4%** |
|  Abbott Laboratories | Abbott Laboratories |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 11/30/2046 | 95000 |  | 88660 |
|  Baxter International, Inc. | Baxter International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.73%, 4/1/2031 | 75000 |  | 54542 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 12/1/2051 | 50000 |  | 30451 |
|  Boston Scientific Corp. | Boston Scientific Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 6/1/2030 | 75000 |  | 61942 |
|  Medtronic, Inc. | Medtronic, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.63%, 3/15/2045 | 30000 |  | 26221 |
|  Zimmer Biomet Holdings, Inc. | Zimmer Biomet Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 11/24/2031 | 75000 |  | 58000 |
|  |  |  | **319816** |
| **Health Care Providers & Services – 5.1%** | **Health Care Providers & Services – 5.1%** | **Health Care Providers & Services – 5.1%** | **Health Care Providers & Services – 5.1%** |
|  Aetna, Inc. | Aetna, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 8/15/2047 | 50000 |  | 35956 |
|  AmerisourceBergen Corp. | AmerisourceBergen Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 3/15/2031 | 75000 |  | 59690 |
|  Cardinal Health, Inc. | Cardinal Health, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.08%, 6/15/2024 | 75000 |  | 72284 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 9/15/2045 | 50000 |  | 39600 |
|  Cigna Corp. | Cigna Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 10/15/2028 | 60000 |  | 56479 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.90%, 12/15/2048 | 100000 |  | 84906 |
|  CVS Health Corp. | CVS Health Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 7/20/2025 | 75000 |  | 72363 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/25/2028 | 150000 |  | 140749 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.78%, 3/25/2038 | 10000 |  | 8680 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 3/25/2048 | 150000 |  | 127416 |
|  Elevance Health, Inc. | Elevance Health, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 1/15/2025 | 150000 |  | 140959 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 5/15/2030 | 75000 |  | 60224 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 3/15/2051 | 75000 |  | 52763 |

---

*See Accompanying Notes to the Financial Statements.* 

458 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Kaiser Foundation Hospitals | Kaiser Foundation Hospitals |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series<br>2021, 2.81%, 6/1/2041 | 75000 | $| 50218 |
|  Laboratory Corp. of America Holdings | Laboratory Corp. of America Holdings |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.55%, 6/1/2026 | 75000 |  | 65112 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 6/1/2031 | 75000 |  | 59721 |
|  Quest Diagnostics, Inc. | Quest Diagnostics, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 6/30/2030 | 50000 |  | 41783 |
|  |  |  | **1168903** |
| **Hotels, Restaurants & Leisure – 1.1%** | **Hotels, Restaurants & Leisure – 1.1%** | **Hotels, Restaurants & Leisure – 1.1%** | **Hotels, Restaurants & Leisure – 1.1%** |
|  Marriott International, Inc. | Marriott International, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series R, 3.13%, 6/15/2026 | 100000 |  | 91277 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series II, 2.75%, 10/15/2033 | 5000 |  | 3630 |
|  McDonald's Corp. | McDonald's Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/1/2027 | 75000 |  | 69843 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.70%, 12/9/2035 | 50000 |  | 45546 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/9/2045 | 50000 |  | 43262 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 9/1/2049 | 15000 |  | 10582 |
|  |  |  | **264140** |
| **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** | **Household Durables – 0.5%** |
|  Lennar Corp. | Lennar Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/30/2024 | 75000 |  | 73635 |
|  Whirlpool Corp. | Whirlpool Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 5/15/2050 | 50000 |  | 36154 |
|  |  |  | **109789** |
| **Household Products – 0.3%** | **Household Products – 0.3%** | **Household Products – 0.3%** | **Household Products – 0.3%** |
|  Kimberly-Clark Corp. | Kimberly-Clark Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 3/26/2030 | 75000 |  | 65690 |
| **Independent Power and Renewable Electricity<br>Producers – 0.4%** | **Independent Power and Renewable Electricity<br>Producers – 0.4%** | **Independent Power and Renewable Electricity<br>Producers – 0.4%** | **Independent Power and Renewable Electricity<br>Producers – 0.4%** |
|  Constellation Energy Generation LLC | Constellation Energy Generation LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 6/1/2025 | 75000 |  | 71112 |
|  Oglethorpe Power Corp. | Oglethorpe Power Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 10/1/2048 | 20000 |  | 16047 |
|  |  |  | **87159** |
| **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** |
|  3M Co. | 3M Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/15/2050 | 45000 |  | 32152 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** | **Industrial Conglomerates – (continued)** |
|  Trane Technologies Luxembourg Finance SA |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 3/21/2029 | 75000 | $| 66866 |
|  |  |  | **99018** |
| **Insurance – 4.2%** | **Insurance – 4.2%** | **Insurance – 4.2%** | **Insurance – 4.2%** |
|  Allstate Corp. (The) | Allstate Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 8/10/2049 | 40000 |  | 28973 |
|  American International Group, Inc. | American International Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 4/1/2048 | 75000 |  | 61911 |
|  Brighthouse Financial, Inc. | Brighthouse Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 12/22/2051 | 50000 |  | 29397 |
|  Chubb INA Holdings, Inc. | Chubb INA Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 5/3/2026 | 150000 |  | 141177 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 11/3/2045 | 20000 |  | 16305 |
|  Everest Reinsurance Holdings, Inc. | Everest Reinsurance Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 10/15/2052 | 50000 |  | 28992 |
|  Hartford Financial Services Group, Inc. (The) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 8/19/2049 | 35000 |  | 23772 |
|  Lincoln National Corp. | Lincoln National Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 6/15/2050 | 15000 |  | 10777 |
|  Manulife Financial Corp. | Manulife Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.06%, 2/24/2032(a) | 75000 |  | 66080 |
|  MetLife, Inc. | MetLife, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 4/10/2024 | 150000 |  | 146696 |
| &nbsp;&nbsp;&nbsp;&nbsp; 10.75%, 8/1/2039 | 50000 |  | 64600 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.60%, 5/13/2046 | 40000 |  | 33308 |
|  Prudential Financial, Inc. | Prudential Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 3/10/2026 | 150000 |  | 132874 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 9/15/2047(a) | 75000 |  | 64670 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.35%, 2/25/2050 | 50000 |  | 39626 |
|  Travelers Cos., Inc. (The) | Travelers Cos., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 5/30/2047 | 60000 |  | 45586 |
|  Unum Group | Unum Group |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 6/15/2051 | 50000 |  | 31474 |
|  |  |  | **966218** |
| **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** | **Interactive Media & Services – 0.2%** |
|  Alphabet, Inc. | Alphabet, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.10%, 8/15/2030 | 15000 |  | 11520 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 8/15/2050 | 75000 |  | 42886 |
|  |  |  | **54406** |
| **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** | **Internet & Direct Marketing Retail – 0.3%** |
|  eBay, Inc. | eBay, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 3/11/2030 | 75000 |  | 60965 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 459

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **IT Services – 0.7%** | **IT Services – 0.7%** | **IT Services – 0.7%** |
|  Mastercard, Inc. | Mastercard, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 6/1/2029 | $140000 | $123900 |
|  PayPal Holdings, Inc. | PayPal Holdings, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.05%, 6/1/2052 | 35000 | 30330 |
|  |  | **154230** |
| **Leisure Products – 0.1%** | **Leisure Products – 0.1%** | **Leisure Products – 0.1%** |
|  Hasbro, Inc. | Hasbro, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.35%, 3/15/2040 | 15000 | 13719 |
| **Machinery – 1.6%** | **Machinery – 1.6%** | **Machinery – 1.6%** |
|  Caterpillar, Inc. | Caterpillar, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 5/27/2041 | 75000 | 72312 |
|  Cummins, Inc. | Cummins, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 9/1/2030 | 75000 | 57122 |
|  Illinois Tool Works, Inc. | Illinois Tool Works, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 11/15/2026 | 150000 | 137504 |
|  Otis Worldwide Corp. | Otis Worldwide Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.11%, 2/15/2040 | 75000 | 52076 |
|  Stanley Black & Decker, Inc. | Stanley Black & Decker, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 3/15/2060(a) | 75000 | 62152 |
|  |  | **381166** |
| **Media – 2.0%** | **Media – 2.0%** | **Media – 2.0%** |
|  Charter Communications Operating LLC | Charter Communications Operating LLC |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 4/1/2063 | 320000 | 241781 |
|  Fox Corp. | Fox Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.71%, 1/25/2029 | 75000 | 69811 |
|  Paramount Global | Paramount Global |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 1/15/2031 | 75000 | 65459 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.38%, 3/15/2043 | 75000 | 50483 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 5/19/2050 | 50000 | 34964 |
|  |  | **462498** |
| **Metals & Mining – 0.3%** | **Metals & Mining – 0.3%** | **Metals & Mining – 0.3%** |
|  Newmont Corp. | Newmont Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.88%, 4/1/2035 | 75000 | 72131 |
| **Multiline Retail – 1.0%** | **Multiline Retail – 1.0%** | **Multiline Retail – 1.0%** |
|  Kohl's Corp. | Kohl's Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 5/1/2031(d) | 50000 | 33062 |
|  Target Corp. | Target Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 4/15/2025 | 75000 | 70482 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 9/15/2030 | 150000 | 125477 |
|  |  | **229021** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** | **Multi-Utilities – 1.2%** |
|  CMS Energy Corp. | CMS Energy Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 3/1/2044 | $25000 | $20749 |
|  Consolidated Edison Co. of New York, Inc. | Consolidated Edison Co. of New York, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2058 | 50000 | 37816 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 6/15/2061 | 35000 | 23120 |
|  Dominion Energy, Inc. | Dominion Energy, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series C, 3.38%, 4/1/2030 | 100000 | 85833 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series B, 3.30%, 4/15/2041 | 58000 | 41058 |
|  San Diego Gas & Electric Co. | San Diego Gas & Electric Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 8/15/2051 | 45000 | 28369 |
|  Sempra Energy | Sempra Energy |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 2/1/2048 | 50000 | 35652 |
|  |  | **272597** |
| **Oil, Gas & Consumable Fuels – 5.1%** | **Oil, Gas & Consumable Fuels – 5.1%** | **Oil, Gas & Consumable Fuels – 5.1%** |
|  BP Capital Markets America, Inc. | BP Capital Markets America, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/8/2061 | 75000 | 47631 |
|  Cheniere Corpus Christi Holdings LLC | Cheniere Corpus Christi Holdings LLC |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 11/15/2029 | 25000 | 21774 |
|  Devon Energy Corp. | Devon Energy Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 6/15/2045 | 35000 | 29214 |
|  Enbridge, Inc. | Enbridge, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 8/1/2033 | 75000 | 56083 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 7/15/2077(a) | 75000 | 64357 |
|  Enterprise Products Operating LLC | Enterprise Products Operating LLC |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.45%, 9/1/2040 | 45000 | 44150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/15/2048 | 75000 | 55670 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.20%, 1/31/2050 | 25000 | 18373 |
|  Hess Corp. | Hess Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 7/15/2024 | 75000 | 72322 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 1/15/2040 | 25000 | 23416 |
|  Kinder Morgan Energy Partners LP | Kinder Morgan Energy Partners LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.95%, 1/15/2038 | 75000 | 74526 |
|  Kinder Morgan, Inc. | Kinder Morgan, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 6/1/2025 | 75000 | 72980 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 2/15/2031 | 20000 | 15006 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.55%, 6/1/2045 | 50000 | 43216 |
|  Magellan Midstream Partners LP | Magellan Midstream Partners LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 3/1/2050 | 50000 | 34097 |
|  Marathon Petroleum Corp. | Marathon Petroleum Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/1/2048 | 50000 | 37556 |
|  MPLX LP | MPLX LP |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 3/1/2026 | 75000 | 65388 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 8/15/2030 | 25000 | 19682 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.50%, 2/15/2049 | 55000 | 45895 |

---

*See Accompanying Notes to the Financial Statements.* 

460 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  Sabine Pass Liquefaction LLC | Sabine Pass Liquefaction LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 5/15/2030 | 25000 | $| 22802 |
|  TotalEnergies Capital International SA |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.83%, 1/10/2030 | 75000 |  | 64373 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 5/29/2050 | 55000 |  | 36299 |
|  Transcontinental Gas Pipe Line Co. LLC |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 5/15/2030 | 50000 |  | 42102 |
|  Valero Energy Corp. | Valero Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 12/1/2031 | 75000 |  | 59150 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/1/2052 | 30000 |  | 21205 |
|  Williams Cos., Inc. (The) | Williams Cos., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.75%, 6/24/2044 | 50000 |  | 44623 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.10%, 9/15/2045 | 55000 |  | 45151 |
|  |  |  | **1177041** |
| **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** | **Paper & Forest Products – 0.2%** |
|  Suzano Austria GmbH | Suzano Austria GmbH |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series DM3N,<br>3.13%, 1/15/2032 | 75000 |  | 55312 |
| **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** | **Personal Products – 0.5%** |
|  Estee Lauder Cos., Inc. (The) | Estee Lauder Cos., Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 3/15/2027 | 75000 |  | 69296 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 3/15/2031 | 50000 |  | 39146 |
|  |  |  | **108442** |
| **Pharmaceuticals – 4.6%** | **Pharmaceuticals – 4.6%** | **Pharmaceuticals – 4.6%** | **Pharmaceuticals – 4.6%** |
|  AstraZeneca plc | AstraZeneca plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 9/18/2042 | 30000 |  | 24633 |
|  Bristol-Myers Squibb Co. | Bristol-Myers Squibb Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 3/15/2062 | 135000 |  | 98610 |
|  GlaxoSmithKline Capital, Inc. | GlaxoSmithKline Capital, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.38%, 5/15/2038 | 25000 |  | 26794 |
|  Johnson & Johnson | Johnson & Johnson |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.63%, 3/3/2037 | 120000 |  | 102589 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/1/2046 | 75000 |  | 59629 |
|  Merck & Co., Inc. | Merck & Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 3/7/2024 | 75000 |  | 73095 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/7/2029 | 75000 |  | 68420 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.35%, 6/24/2040 | 150000 |  | 99404 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 12/10/2051 | 50000 |  | 31765 |
|  Mylan, Inc. | Mylan, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.20%, 4/15/2048 | 25000 |  | 16858 |

---

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** | **Pharmaceuticals – (continued)** |
|  Novartis Capital Corp. | Novartis Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 5/6/2024 | 75000 | $| 73547 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 2/14/2027 | 75000 |  | 66995 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 8/14/2050 | 75000 |  | 49167 |
|  Pfizer, Inc. | Pfizer, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 5/28/2025 | 75000 |  | 67997 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 3/15/2029 | 75000 |  | 68634 |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.20%, 3/15/2039 | 75000 |  | 87952 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 5/28/2040 | 50000 |  | 34599 |
|  Viatris, Inc. | Viatris, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/22/2050 | 35000 |  | 20290 |
|  |  |  | **1070978** |
| **Road & Rail – 2.2%** | **Road & Rail – 2.2%** | **Road & Rail – 2.2%** | **Road & Rail – 2.2%** |
|  Canadian National Railway Co. | Canadian National Railway Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 1/20/2049 | 55000 |  | 45757 |
|  Canadian Pacific Railway Co. | Canadian Pacific Railway Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 12/2/2024 | 75000 |  | 69216 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.80%, 8/1/2045 | 65000 |  | 55251 |
|  CSX Corp. | CSX Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 8/1/2024 | 75000 |  | 72910 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.30%, 3/1/2048 | 75000 |  | 59893 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 4/15/2050 | 25000 |  | 18115 |
|  JB Hunt Transport Services, Inc. | JB Hunt Transport Services, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.88%, 3/1/2026 | 45000 |  | 43161 |
|  Kansas City Southern | Kansas City Southern |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 11/15/2029 | 75000 |  | 63246 |
|  Norfolk Southern Corp. | Norfolk Southern Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/15/2032 | 75000 |  | 62098 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/15/2053 | 20000 |  | 13991 |
|  |  |  | **503638** |
| **Semiconductors & Semiconductor Equipment – 1.2%** | **Semiconductors & Semiconductor Equipment – 1.2%** | **Semiconductors & Semiconductor Equipment – 1.2%** | **Semiconductors & Semiconductor Equipment – 1.2%** |
|  Intel Corp. | Intel Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.00%, 8/12/2031 | 70000 |  | 53482 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 3/25/2050 | 150000 |  | 121548 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.95%, 3/25/2060 | 50000 |  | 40488 |
|  QUALCOMM, Inc. | QUALCOMM, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 5/20/2025 | 75000 |  | 72358 |
|  |  |  | **287876** |
| **Software – 3.5%** | **Software – 3.5%** | **Software – 3.5%** | **Software – 3.5%** |
|  Adobe, Inc. | Adobe, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 2/1/2030 | 50000 |  | 41553 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 461

------

##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Software – (continued)** | **Software – (continued)** | **Software – (continued)** | **Software – (continued)** |
|  Microsoft Corp. | Microsoft Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 8/8/2026 | 90000 | $| 83274 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 2/6/2027 | 200000 |  | 190093 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.45%, 8/8/2036 | 50000 |  | 42843 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.53%, 6/1/2050 | 250000 |  | 156832 |
|  Salesforce, Inc. | Salesforce, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 7/15/2028 | 75000 |  | 62645 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 7/15/2051 | 75000 |  | 48297 |
|  VMware, Inc. | VMware, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.40%, 8/15/2026 | 150000 |  | 127966 |
|  Workday, Inc. | Workday, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/1/2029 | 75000 |  | 66782 |
|  |  |  | **820285** |
| **Specialty Retail – 1.4%** | **Specialty Retail – 1.4%** | **Specialty Retail – 1.4%** | **Specialty Retail – 1.4%** |
|  Home Depot, Inc. (The) | Home Depot, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.95%, 4/1/2041 | 10000 |  | 10160 |
|  Lowe's Cos., Inc. | Lowe's Cos., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 4/15/2026 | 50000 |  | 45721 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 4/5/2029 | 75000 |  | 67426 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 4/1/2031 | 75000 |  | 60048 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 4/15/2033 | 65000 |  | 61330 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 9/15/2041 | 50000 |  | 31831 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 10/15/2050 | 50000 |  | 29960 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.45%, 4/1/2062 | 10000 |  | 7264 |
|  |  |  | **313740** |
| **Technology Hardware, Storage & Peripherals – 2.4%** | **Technology Hardware, Storage & Peripherals – 2.4%** | **Technology Hardware, Storage & Peripherals – 2.4%** | **Technology Hardware, Storage & Peripherals – 2.4%** |
|  Apple, Inc. | Apple, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.25%, 2/23/2026 | 125000 |  | 119197 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 2/8/2041 | 80000 |  | 53538 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 5/4/2043 | 150000 |  | 122080 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.65%, 2/23/2046 | 50000 |  | 45167 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 8/8/2062 | 30000 |  | 23303 |
|  Dell International LLC | Dell International LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 8.10%, 7/15/2036 | 54000 |  | 57205 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 12/15/2041(b) | 50000 |  | 31031 |
|  Hewlett Packard Enterprise Co. | Hewlett Packard Enterprise Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.35%, 10/15/2045(d) | 20000 |  | 18087 |
|  HP, Inc. | HP, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 6/17/2031 | 58000 |  | 42499 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.00%, 9/15/2041 | 50000 |  | 44306 |
|  |  |  | **556413** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Textiles, Apparel & Luxury Goods – 0.1%** | **Textiles, Apparel & Luxury Goods – 0.1%** | **Textiles, Apparel & Luxury Goods – 0.1%** |
|  Ralph Lauren Corp. | Ralph Lauren Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 6/15/2030 | $10000 | $8380 |
|  VF Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 4/23/2030 | 30000 | 24202 |
|  |  | **32582** |
| **Water Utilities – 0.5%** | **Water Utilities – 0.5%** | **Water Utilities – 0.5%** |
|  American Water Capital Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 6/1/2031 | 150000 | 117445 |
| **Wireless Telecommunication Services – 0.6%** | **Wireless Telecommunication Services – 0.6%** | **Wireless Telecommunication Services – 0.6%** |
|  Vodafone Group plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 5/30/2048 | 150000 | 122647 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/19/2049 | 25000 | 19346 |
|  |  | **141993** |
| **Total Corporate Bonds <br>(Cost $27,069,070)** | **Total Corporate Bonds <br>(Cost $27,069,070)** | **21969323** |
| **Total Investments – 94.9% <br>(Cost $27,069,070)** | **Total Investments – 94.9% <br>(Cost $27,069,070)** | **21969323** |
|  Other assets less liabilities – 5.1% | Other assets less liabilities – 5.1% | 1186202 |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**23155525** |

---

*<sup>(a)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(b)</sup>* *Securities exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. The value of these securities is determined by valuations supplied by a pricing service or brokers, or, if not available, in accordance with procedures established by the Board of Trustees.* 

*<sup>(c)</sup>* *Represents less than 0.05% of net assets.* 

*<sup>(d)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*See Accompanying Notes to the Financial Statements.* 

462 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® ESG & Climate Investment Grade Corporate Core Index Fund (cont.)

------

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $13 |
|  Aggregate gross unrealized depreciation | (5228498) |
|  Net unrealized depreciation | $(5228485) |
|  Federal income tax cost | $27197808 |

---

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 94.9% |
|  Others<sup>(1)</sup> | 5.1 |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 463

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares® Ready Access Variable Income Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – 75.6%** | **CORPORATE BONDS – 75.6%** | **CORPORATE BONDS – 75.6%** |
| **Aerospace & Defense – 1.4%** | **Aerospace & Defense – 1.4%** | **Aerospace & Defense – 1.4%** |
|  Boeing Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.17%, 2/4/2023 | $929000 | $919845 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.51%, 5/1/2023 | 775000 | 771804 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 2/1/2024 | 900000 | 858258 |
|  General Dynamics Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 11/15/2022 | 6480000 | 6475731 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 5/15/2023 | 2650000 | 2627074 |
|  |  | **11652712** |
| **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** | **Air Freight & Logistics – 0.4%** |
|  United Parcel Service, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 4/1/2023 | 1047000 | 1036572 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.45%),<br>4.19%, 4/1/2023(a) | 2540000 | 2537198 |
|  |  | **3573770** |
| **Automobiles – 2.4%** | **Automobiles – 2.4%** | **Automobiles – 2.4%** |
|  BMW US Capital LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 4/6/2023(b) | 2250000 | 2238817 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.53%),<br>3.58%, 4/1/2024(a)(b) | 900000 | 895995 |
|  Hyundai Capital America |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 9/18/2023(b) | 910000 | 874142 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 1/8/2024(b) | 1700000 | 1604506 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 6/14/2024(b) | 1000000 | 918577 |
|  Kia Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.38%, 2/14/2025(b) | 730000 | 672075 |
|  Mercedes-Benz Finance North America LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 2/22/2023(b) | 1020000 | 1015047 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 3/1/2024(b) | 2350000 | 2213324 |
|  Nissan Motor Acceptance Co. LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.13%, 9/16/2024(b) | 900000 | 803576 |
|  Stellantis NV |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.25%, 4/15/2023 | 2211000 | 2202753 |
|  Volkswagen Group of America Finance LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 11/23/2022(b) | 1000000 | 997180 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** | **Automobiles – (continued)** |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 5/12/2023(b) | $| 1410000 | $| 1393533 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 11/22/2023(b) |  | 2000000 |  | 1903859 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.95%),<br>4.00%, 6/7/2024(a)(b) |  | 2690000 |  | 2681287 |
|  |  |  |  | **20414671** |
| **Banks – 21.8%** | **Banks – 21.8%** | **Banks – 21.8%** | **Banks – 21.8%** | **Banks – 21.8%** |
|  ANZ New Zealand Int'l Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.60%),<br>3.67%, 2/18/2025(a)(b) |  | 1450000 |  | 1433795 |
|  Australia & New Zealand Banking Group Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 11/9/2022 |  | 6000000 |  | 5998017 |
|  Banco Santander SA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 1.24%),<br>4.26%, 5/24/2024(a) |  | 4800000 |  | 4785667 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.15%, 8/18/2025 |  | 1400000 |  | 1345535 |
|  Bank of America Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (BSBY3M + 0.43%),<br>3.34%, 5/28/2024(a) |  | 3700000 |  | 3642539 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.73%),<br>3.78%, 10/24/2024(a) |  | 2200000 |  | 2172999 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2025, (SOFR + 0.66%),<br>3.73%, 2/4/2025(a) |  | 2000000 |  | 1966565 |
|  Bank of Montreal |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.27%),<br>3.32%, 4/14/2023(a) |  | 6588000 |  | 6571651 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.62%),<br>3.68%, 9/15/2026(a) |  | 3300000 |  | 3160301 |
|  Bank of New Zealand |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.81%),<br>3.86%, 1/27/2027(a)(b) |  | 4000000 |  | 3918692 |
|  Bank of Nova Scotia (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.55%, 9/15/2023 |  | 3000000 |  | 2879703 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.55%),<br>3.61%, 3/2/2026(a) |  | 5000000 |  | 4813976 |

---

*See Accompanying Notes to the Financial Statements.* 

464 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Banque Federative du Credit Mutuel SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.96%),<br>5.20%, 7/20/2023(a)(b) | $1000000 | $1003320 |
|  BNP Paribas SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 10/15/2024 | 1000000 | 963141 |
|  Canadian Imperial Bank of Commerce |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.80%),<br>3.86%, 3/17/2023(a) | 2300000 | 2299128 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.45%, 6/22/2023 | 5000000 | 4850549 |
|  Capital One NA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 2/15/2023 | 350000 | 348433 |
|  Citigroup, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.67%),<br>3.74%, 5/1/2025(a) | 900000 | 880483 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.69%),<br>3.74%, 1/25/2026(a) | 2400000 | 2326586 |
|  Citizens Bank NA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/29/2023 | 6645000 | 6609316 |
|  Commonwealth Bank of Australia |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.40%),<br>3.46%, 7/7/2025(a)(b) | 1800000 | 1770371 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.52%),<br>3.58%, 6/15/2026(a)(b) | 1900000 | 1858838 |
|  Cooperatieve Rabobank UA | Cooperatieve Rabobank UA |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.30%),<br>3.33%, 1/12/2024(a) | 2000000 | 1984740 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.38%),<br>3.42%, 1/10/2025(a) | 1600000 | 1578672 |
|  Credit Agricole SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.75%, 4/24/2023(b) | 5899000 | 5853797 |
|  Discover Bank |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 2/6/2023 | 3878000 | 3859014 |
|  Fifth Third Bank NA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.85%, 10/27/2025(c) | 8500000 | 8510446 |
|  HSBC Holdings plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.73%, 8/17/2024(c) | 2240000 | 2124013 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  ING Groep NV | ING Groep NV |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 1.01%),<br>4.02%, 4/1/2027(a) | $3800000 | $3625925 |
|  JPMorgan Chase & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.77%, 8/9/2025(c) | 1000000 | 912585 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.92%),<br>3.99%, 2/24/2026(a) | 6000000 | 5851620 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.77%),<br>3.82%, 9/22/2027(a) | 2500000 | 2354779 |
|  KeyBank NA | KeyBank NA |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.34%),<br>3.39%, 1/3/2024(a) | 4800000 | 4760393 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.32%),<br>3.38%, 6/14/2024(a) | 2000000 | 1977002 |
|  Lloyds Banking Group plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 8/16/2023 | 4729000 | 4672701 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.72%, 8/11/2026(c) | 2300000 | 2176151 |
|  Mitsubishi UFJ Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.46%, 3/2/2023 | 500000 | 497713 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.79%, 7/18/2025(c) | 2000000 | 1961847 |
|  Mizuho Financial Group, Inc. | Mizuho Financial Group, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.61%),<br>3.78%, 9/8/2024(a) | 2900000 | 2868681 |
|  National Australia Bank Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.88%, 12/13/2022 | 1000000 | 997346 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.86%),<br>3.92%, 6/9/2025(a)(b) | 5200000 | 5181828 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.65%),<br>3.68%, 1/12/2027(a)(b) | 4000000 | 3920000 |
|  National Bank of Canada |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 8/6/2024 | 900000 | 826861 |
|  NatWest Markets plc | NatWest Markets plc |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.53%),<br>3.60%, 8/12/2024(a)(b) | 600000 | 588087 |
|  Nordea Bank Abp |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.00%, 6/9/2023(b) | 640000 | 623243 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.96%),<br>4.00%, 6/6/2025(a)(b) | 2000000 | 1984130 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 465

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  PNC Financial Services Group, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.85%, 11/9/2022(d) | $375000 | $374881 |
|  Royal Bank of Canada | Royal Bank of Canada |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.36%),<br>4.44%, 1/17/2023(a) | 536000 | 535378 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.97%, 7/26/2024 | 3000000 | 2930690 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.44%),<br>3.49%, 1/21/2025(a) | 3000000 | 2941640 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.53%),<br>3.58%, 1/20/2026(a) | 2750000 | 2658824 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.57%),<br>3.62%, 4/27/2026(a) | 2000000 | 1930677 |
|  Skandinaviska Enskilda Banken AB |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 12/12/2022(b) | 600000 | 598398 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.32%),<br>3.40%, 9/1/2023(a)(b) | 2800000 | 2787508 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.65%, 9/9/2024(b) | 500000 | 457684 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.96%),<br>4.02%, 6/9/2025(a)(b) | 1000000 | 993309 |
|  Societe Generale SA |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 10/16/2024(b) | 1000000 | 932715 |
|  Sumitomo Mitsui Financial Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.51%, 1/12/2024 | 300000 | 282679 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.88%),<br>3.90%, 1/14/2027(a) | 1480000 | 1441772 |
|  Sumitomo Mitsui Trust Bank Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 9/12/2023(b) | 900000 | 864862 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.85%, 3/25/2024(b) | 400000 | 374422 |
|  Svenska Handelsbanken AB | Svenska Handelsbanken AB |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.91%), 3.96%, 6/10/2025(a)(b) | 7000000 | 6949457 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** | **Banks – (continued)** |
|  Swedbank AB |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 6/2/2023(b) | $| 400000 | $| 390376 |
|  Toronto-Dominion Bank (The) | Toronto-Dominion Bank (The) | Toronto-Dominion Bank (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.24%),<br>3.30%, 1/6/2023(a) |  | 500000 |  | 499699 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.45%, 9/11/2023 |  | 2606000 |  | 2497272 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.59%),<br>3.64%, 9/10/2026(a) |  | 2000000 |  | 1935031 |
|  Truist Bank |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 3/9/2023 |  | 1000000 |  | 987311 |
|  Truist Financial Corp. | Truist Financial Corp. | Truist Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.40%),<br>3.46%, 6/9/2025(a) |  | 3750000 |  | 3668673 |
|  US Bank NA |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 7/24/2023 |  | 4010000 |  | 3961394 |
|  Wells Fargo & Co. | Wells Fargo & Co. | Wells Fargo & Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 1.32%),<br>4.36%, 4/25/2026(a) |  | 2600000 |  | 2574702 |
|  Westpac Banking Corp. | Westpac Banking Corp. | Westpac Banking Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.57%), 4.48%, 1/11/2023(a) |  | 663000 |  | 662579 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 1.00%),<br>4.07%, 8/26/2025(a) |  | 5000000 |  | 4999930 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.52%),<br>3.56%, 6/3/2026(a) |  | 2568000 |  | 2509414 |
|  |  |  |  | **187032456** |
| **Beverages – 1.4%** | **Beverages – 1.4%** | **Beverages – 1.4%** | **Beverages – 1.4%** | **Beverages – 1.4%** |
|  Constellation Brands, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.60%, 5/9/2024 |  | 1590000 |  | 1555679 |
|  Diageo Capital plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 4/29/2023 |  | 6060000 |  | 5993701 |
|  Keurig Dr Pepper, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 3/15/2024 |  | 3500000 |  | 3297276 |
|  PepsiCo, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 5/1/2023 |  | 735000 |  | 720930 |
|  |  |  |  | **11567586** |
| **Biotechnology – 1.6%** | **Biotechnology – 1.6%** | **Biotechnology – 1.6%** | **Biotechnology – 1.6%** | **Biotechnology – 1.6%** |
|  AbbVie, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.90%, 11/6/2022 |  | 4000000 |  | 3998560 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.30%, 11/21/2022 |  | 2000000 |  | 1997308 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.65%),<br>3.63%, 11/21/2022(a) |  | 1035000 |  | 1034265 |

---

*See Accompanying Notes to the Financial Statements.* 

466 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** | **Biotechnology – (continued)** |
|  Gilead Sciences, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.75%, 9/29/2023 | $| 6624000 | $| 6375278 |
|  |  |  |  | **13405411** |
| **Capital Markets – 5.1%** | **Capital Markets – 5.1%** | **Capital Markets – 5.1%** | **Capital Markets – 5.1%** | **Capital Markets – 5.1%** |
|  Ares Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 2/10/2023 |  | 1100000 |  | 1093595 |
|  Bank of New York Mellon Corp. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series J, (SOFR + 0.20%), 3.24%, 10/25/2024(a) |  | 2800000 |  | 2753392 |
|  Blackstone Private Credit Fund |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 1/15/2025 |  | 800000 |  | 730841 |
|  Charles Schwab Corp. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 1/25/2023 |  | 1472000 |  | 1465952 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.50%),<br>3.55%, 3/18/2024(a) |  | 1390000 |  | 1381124 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 1.05%),<br>4.09%, 3/3/2027(a) |  | 7000000 |  | 6850320 |
|  Credit Suisse Group AG |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.80%, 6/9/2023 |  | 1000000 |  | 975000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 6.37%, 7/15/2026(b)(c) |  | 1900000 |  | 1767731 |
|  Deutsche Bank AG | Deutsche Bank AG | Deutsche Bank AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 1.19%),<br>4.11%, 11/16/2022(a) |  | 1150000 |  | 1149377 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 1.23%),<br>4.27%, 2/27/2023(a) |  | 650000 |  | 648902 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.90%, 5/28/2024 |  | 1100000 |  | 1009547 |
|  FS KKR Capital Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.65%, 10/12/2024 |  | 980000 |  | 887914 |
|  Goldman Sachs Group, Inc. (The) | Goldman Sachs Group, Inc. (The) | Goldman Sachs Group, Inc. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.54%),<br>3.61%, 11/17/2023(a) |  | 300000 |  | 298536 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.58%), 3.64%, 3/8/2024(a) |  | 2600000 |  | 2567958 |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.70%, 11/1/2024 |  | 3000000 |  | 3000201 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** | **Capital Markets – (continued)** |
|  Morgan Stanley |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.16%, 10/21/2025(c) | $| 500000 | $| 453119 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.95%),<br>4.02%, 2/18/2026(a) |  | 3000000 |  | 2932928 |
|  Nasdaq, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.45%, 12/21/2022 |  | 4800000 |  | 4772052 |
|  UBS AG | UBS AG | UBS AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.32%),<br>3.38%, 6/1/2023(a)(b) |  | 2500000 |  | 2494475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.70%, 8/9/2024(b) |  | 200000 |  | 183747 |
|  UBS Group AG | UBS Group AG | UBS Group AG |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 1.58%),<br>4.64%, 5/12/2026(a)(b) |  | 6000000 |  | 5933152 |
|  |  |  |  | **43349863** |
| **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** | **Chemicals – 0.9%** |
|  Air Products and Chemicals, Inc. | Air Products and Chemicals, Inc. | Air Products and Chemicals, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 2/3/2023 |  | 2000000 |  | 1988551 |
|  International Flavors & Fragrances, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 5/1/2023 |  | 750000 |  | 742535 |
|  Nutrien Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.90%, 5/13/2023 |  | 4000000 |  | 3925476 |
|  Sherwin-Williams Co. (The) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.05%, 8/8/2024 |  | 700000 |  | 686766 |
|  Westlake Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 8/15/2024 |  | 300000 |  | 278317 |
|  |  |  |  | **7621645** |
| **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** | **Commercial Services & Supplies – 1.2%** |
|  RELX Capital, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 3/16/2023 |  | 660000 |  | 656019 |
|  Republic Services, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.75%, 5/15/2023 |  | 6500000 |  | 6488242 |
|  Waste Management, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.40%, 5/15/2023 |  | 3500000 |  | 3457449 |
|  |  |  |  | **10601710** |
| **Communications Equipment – 0.1%** | **Communications Equipment – 0.1%** | **Communications Equipment – 0.1%** | **Communications Equipment – 0.1%** | **Communications Equipment – 0.1%** |
|  Cisco Systems, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.60%, 2/28/2023 |  | 471000 |  | 467281 |
| **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** | **Construction Materials – 0.1%** |
|  Martin Marietta Materials, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.65%, 7/15/2023 |  | 980000 |  | 947902 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 467

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** | **Consumer Finance – 4.3%** |
|  AerCap Ireland Capital DAC | AerCap Ireland Capital DAC |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.68%),<br>3.74%, 9/29/2023(a) | $900000 | $880782 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.65%, 10/29/2024 | 750000 | 680727 |
|  Ally Financial, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 6/5/2023 | 3470000 | 3411917 |
|  American Express Co. | American Express Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.72%),<br>3.79%, 5/3/2024(a) | 3000000 | 2987511 |
|  American Honda Finance Corp. | American Honda Finance Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.37%),<br>3.28%, 5/10/2023(a) | 2500000 | 2499718 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.88%, 7/7/2023 | 2420000 | 2351296 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.42%),<br>3.59%, 9/8/2023(a) | 600000 | 598768 |
|  Capital One Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 1/30/2023 | 2000000 | 1990833 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.72%),<br>5.13%, 1/30/2023(a) | 1500000 | 1499627 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/15/2023 | 1000000 | 990569 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 1.35%),<br>4.42%, 5/9/2025(a) | 2000000 | 1971302 |
|  General Motors Financial Co., Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.15%, 6/19/2023 | 465000 | 461093 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.70%, 8/18/2023 | 380000 | 367947 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.76%),<br>3.82%, 3/8/2024(a) | 800000 | 785946 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 11/7/2024 | 600000 | 571892 |
|  John Deere Capital Corp. | John Deere Capital Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.12%),<br>3.15%, 7/10/2023(a) | 1500000 | 1493125 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.20%),<br>3.23%, 10/11/2024(a) | 2500000 | 2467950 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.56%),<br>3.59%, 3/7/2025(a) | 1720000 | 1704727 |
|  PACCAR Financial Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 4/6/2023 | 1000000 | 991454 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** | **Consumer Finance – (continued)** |
|  Synchrony Financial |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 6/13/2025 | $| 1493000 | $| 1434448 |
|  Toyota Motor Credit Corp. | Toyota Motor Credit Corp. | Toyota Motor Credit Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.32%),<br>3.37%, 1/13/2025(a) |  | 7000000 |  | 6888092 |
|  |  |  |  | **37029724** |
| **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** | **Containers & Packaging – 0.1%** |
|  Avery Dennison Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.85%, 8/15/2024 |  | 1040000 |  | 961579 |
| **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** | **Diversified Financial Services – 0.5%** |
|  Corebridge Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 4/4/2025(b) |  | 2300000 |  | 2167581 |
|  Element Fleet Management Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.60%, 4/6/2024(b) |  | 500000 |  | 470401 |
|  Jackson Financial, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.13%, 11/22/2023 |  | 950000 |  | 905179 |
|  NTT Finance Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.58%, 3/1/2024(b) |  | 600000 |  | 564311 |
|  |  |  |  | **4107472** |
| **Diversified Telecommunication Services – 1.9%** | **Diversified Telecommunication Services – 1.9%** | **Diversified Telecommunication Services – 1.9%** | **Diversified Telecommunication Services – 1.9%** | **Diversified Telecommunication Services – 1.9%** |
|  AT&T, Inc. | AT&T, Inc. | AT&T, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.64%),<br>3.69%, 3/25/2024(a) |  | 4160000 |  | 4134867 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 1.18%),<br>4.42%, 6/12/2024(a) |  | 3550000 |  | 3561568 |
|  Bell Canada (The) | Bell Canada (The) | Bell Canada (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series US-3,<br>0.75%, 3/17/2024 |  | 1850000 |  | 1740172 |
|  British Telecommunications plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 12/4/2023 |  | 3500000 |  | 3453727 |
|  Verizon Communications, Inc. | Verizon Communications, Inc. | Verizon Communications, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 1.10%),<br>4.01%, 5/15/2025(a) |  | 1000000 |  | 999340 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.79%),<br>3.84%, 3/20/2026(a) |  | 2600000 |  | 2536478 |
|  |  |  |  | **16426152** |

---

*See Accompanying Notes to the Financial Statements.* 

468 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Electric Utilities – 2.3%** | **Electric Utilities – 2.3%** | **Electric Utilities – 2.3%** |
|  American Electric Power Co., Inc. | American Electric Power Co., Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, (ICE LIBOR USD 3 Month + 0.48%),<br>3.26%, 11/1/2023(a) | $1400000 | $1390392 |
|  Entergy Louisiana LLC |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.62%, 11/17/2023 | 846000 | 805234 |
|  Eversource Energy | Eversource Energy |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series T, (United States SOFR Compounded Index + 0.25%),<br>3.31%, 8/15/2023(a) | 1500000 | 1491801 |
|  Florida Power & Light Co. | Florida Power & Light Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.38%),<br>3.41%, 1/12/2024(a) | 4400000 | 4353013 |
|  Georgia Power Co. | Georgia Power Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, 2.10%, 7/30/2023 | 2500000 | 2444333 |
|  Mississippi Power Co. | Mississippi Power Co. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, (SOFR + 0.30%), 3.36%, 6/28/2024(a) | 950000 | 930960 |
|  NextEra Energy Capital Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.27%),<br>3.25%, 2/22/2023(a) | 2121000 | 2117195 |
|  OGE Energy Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.70%, 5/26/2023 | 1490000 | 1451780 |
|  PPL Electric Utilities Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.25%), 3.89%, 9/28/2023(a) | 850000 | 847373 |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.33%), 3.38%, 6/24/2024(a) | 1360000 | 1341229 |
|  Southern Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2021, (United States SOFR Compounded Index + 0.37%), 3.44%, 5/10/2023(a) | 820000 | 816450 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 21-A, 0.60%, 2/26/2024 | 1840000 | 1732523 |
|  |  | **19722283** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** | **Energy Equipment & Services – 0.1%** |
|  Baker Hughes Holdings LLC | Baker Hughes Holdings LLC | Baker Hughes Holdings LLC |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.23%, 12/15/2023 | $1220000 | $1169338 |
| **Entertainment – 0.3%** | **Entertainment – 0.3%** | **Entertainment – 0.3%** |
|  Take-Two Interactive Software, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 3/28/2024 | 510000 | 495116 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.55%, 4/14/2025 | 240000 | 228854 |
|  TWDC Enterprises 18 Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.35%, 12/1/2022 | 1855000 | 1852464 |
|  |  | **2576434** |
| **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** | **Equity Real Estate Investment Trusts (REITs) – 2.3%** |
|  American Tower Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 1/31/2023 | 2942000 | 2932865 |
|  Boston Properties LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.13%, 9/1/2023 | 5000000 | 4893896 |
|  Crown Castle, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 7/15/2023 | 1700000 | 1673608 |
|  Public Storage |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.47%), 3.51%, 4/23/2024(a) | 4000000 | 3966748 |
|  Simon Property Group LP |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 6/1/2023 | 5805000 | 5726071 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index +<br>0.43%), 3.47%, 1/11/2024(a) | 700000 | 693849 |
|  |  | **19887037** |
| **Food & Staples Retailing – 0.5%** | **Food & Staples Retailing – 0.5%** | **Food & Staples Retailing – 0.5%** |
|  Kroger Co. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 8/1/2023 | 945000 | 936953 |
|  Walgreens Boots Alliance, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.95%, 11/17/2023 | 1770000 | 1692992 |
|  Walmart, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.35%, 12/15/2022 | 400000 | 399044 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.55%, 4/11/2023 | 1475000 | 1460665 |
|  |  | **4489654** |
| **Food Products – 1.0%** | **Food Products – 1.0%** | **Food Products – 1.0%** |
|  Campbell Soup Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 3/15/2023 | 2394000 | 2381929 |
|  Conagra Brands, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.20%, 1/25/2023 | 2575000 | 2563285 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.50%, 8/11/2023 | 560000 | 538744 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 469

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** | **Food Products – (continued)** |
|  General Mills, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3<br>Month + 1.01%), 5.09%, 10/17/2023(a) | $| 650000 | $| 653193 |
|  Hormel Foods Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.65%, 6/3/2024 |  | 280000 |  | 261520 |
|  McCormick & Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.90%, 2/15/2026 |  | 620000 |  | 534786 |
|  Tyson Foods, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 8/15/2024 |  | 1250000 |  | 1219504 |
|  |  |  |  | **8152961** |
| **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** | **Gas Utilities – 0.3%** |
|  CenterPoint Energy Resources Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.70%, 3/2/2023 |  | 2170000 |  | 2139884 |
|  Southern Natural Gas Co. LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 4/28/2023(b) |  | 180000 |  | 175243 |
|  |  |  |  | **2315127** |
| **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** | **Health Care Equipment & Supplies – 1.9%** |
|  Baxter International, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.87%, 12/1/2023 |  | 1800000 |  | 1720617 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.44%), 3.49%, 11/29/2024(a) |  | 1435000 |  | 1398248 |
|  DH Europe Finance II Sarl |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.05%, 11/15/2022 |  | 8506000 |  | 8498861 |
|  Stryker Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.60%, 12/1/2023 |  | 1910000 |  | 1819181 |
|  Zimmer Biomet Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/19/2023 |  | 2136000 |  | 2126088 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.45%, 11/22/2024 |  | 650000 |  | 599459 |
|  |  |  |  | **16162454** |
| **Health Care Providers & Services – 2.9%** | **Health Care Providers & Services – 2.9%** | **Health Care Providers & Services – 2.9%** | **Health Care Providers & Services – 2.9%** | **Health Care Providers & Services – 2.9%** |
|  Cigna Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.05%, 11/30/2022 |  | 4000000 |  | 3995242 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.89%), 4.97%, 7/15/2023(a) |  | 2500000 |  | 2500332 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** | **Health Care Providers & Services – (continued)** |
|  Elevance Health, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.30%, 1/15/2023 | $| 1725000 | $| 1719244 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.45%, 3/15/2023 |  | 800000 |  | 786731 |
|  HCA, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.00%, 3/15/2024 |  | 400000 |  | 396534 |
|  Humana, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 12/1/2022 |  | 2110000 |  | 2107558 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.65%, 8/3/2023 |  | 1760000 |  | 1700145 |
|  McKesson Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.70%, 12/15/2022 |  | 4096000 |  | 4084439 |
|  UnitedHealth Group, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 2/15/2023 |  | 500000 |  | 497349 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/15/2023 |  | 6000000 |  | 5954537 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.55%, 5/15/2024 |  | 1580000 |  | 1478377 |
|  |  |  |  | **25220488** |
| **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** | **Hotels, Restaurants & Leisure – 1.0%** |
|  Hyatt Hotels Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.30%, 10/1/2023 |  | 500000 |  | 479782 |
|  McDonald's Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.35%, 4/1/2023 |  | 5500000 |  | 5469971 |
|  Starbucks Corp. | Starbucks Corp. | Starbucks Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.42%), 3.48%, 2/14/2024(a) |  | 2370000 |  | 2360117 |
|  |  |  |  | **8309870** |
| **Household Durables – 0.3%** | **Household Durables – 0.3%** | **Household Durables – 0.3%** | **Household Durables – 0.3%** | **Household Durables – 0.3%** |
|  Lennar Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.88%, 12/15/2023 |  | 940000 |  | 931030 |
|  Whirlpool Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 3/1/2023 |  | 2050000 |  | 2036073 |
|  |  |  |  | **2967103** |
| **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** | **Household Products – 0.2%** |
|  Colgate-Palmolive Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.10%, 8/15/2025 |  | 1480000 |  | 1419671 |
| **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** | **Industrial Conglomerates – 0.4%** |
|  3M Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 3/15/2023 |  | 680000 |  | 673650 |
|  General Electric Co. | General Electric Co. | General Electric Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, (ICE LIBOR USD 3 Month + 0.30%), 4.38%, 5/13/2024(a) |  | 3000000 |  | 2919931 |
|  |  |  |  | **3593581** |

---

*See Accompanying Notes to the Financial Statements.* 

470 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Insurance – 1.8%** | **Insurance – 1.8%** | **Insurance – 1.8%** |
|  Allstate Corp. (The) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.63%), 4.27%, 3/29/2023(a) | $849000 | $848001 |
|  Aon Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.20%, 11/15/2022 | 4227000 | 4222834 |
|  Athene Global Funding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.20%, 10/13/2023(b) | 1900000 | 1817446 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.73%), 4.56%, 1/8/2024(a)(b) | 1000000 | 989136 |
|  Brighthouse Financial Global Funding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.60%, 6/28/2023(b) | 630000 | 610073 |
|  Chubb INA Holdings, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 11/3/2022 | 3585000 | 3584821 |
|  New York Life Global Funding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.33%), 3.38%, 1/14/2025(a)(b) | 2000000 | 1973693 |
|  Protective Life Global Funding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 10/13/2023(b) | 900000 | 862487 |
|  Security Benefit Global Funding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 5/17/2024(b) | 650000 | 604210 |
|  |  | **15512701** |
| **Internet & Direct Marketing Retail – 1.5%** | **Internet & Direct Marketing Retail – 1.5%** | **Internet & Direct Marketing Retail – 1.5%** |
|  Amazon.com, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.50%, 11/29/2022 | 5000000 | 4993451 |
|  eBay, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.75%, 1/30/2023 | 6581000 | 6545422 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.87%), 5.28%, 1/30/2023(a) | 1510000 | 1510907 |
|  |  | **13049780** |
| **IT Services – 1.8%** | **IT Services – 1.8%** | **IT Services – 1.8%** |
|  Fidelity National Information Services, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.60%, 3/1/2024 | 910000 | 855723 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** | **IT Services – (continued)** |
|  Global Payments, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.00%, 6/1/2023 | $| 3000000 | $| 2975784 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.50%, 11/15/2024 |  | 240000 |  | 219747 |
|  International Business Machines Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.38%, 8/1/2023 |  | 7000000 |  | 6914075 |
|  PayPal Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 6/1/2023 |  | 4775000 |  | 4672443 |
|  |  |  |  | **15637772** |
| **Life Sciences Tools & Services – 0.9%** | **Life Sciences Tools & Services – 0.9%** | **Life Sciences Tools & Services – 0.9%** | **Life Sciences Tools & Services – 0.9%** | **Life Sciences Tools & Services – 0.9%** |
|  Thermo Fisher Scientific, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.35%), 3.39%, 4/18/2023(a) |  | 5500000 |  | 5491315 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 10/18/2023 |  | 1000000 |  | 959583 |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.22%, 10/18/2024 |  | 390000 |  | 362613 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.53%), 3.57%, 10/18/2024(a) |  | 550000 |  | 544049 |
|  |  |  |  | **7357560** |
| **Machinery – 0.6%** | **Machinery – 0.6%** | **Machinery – 0.6%** | **Machinery – 0.6%** | **Machinery – 0.6%** |
|  CNH Industrial Capital LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.95%, 7/2/2023 |  | 2381000 |  | 2325095 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.95%, 5/23/2025 |  | 1290000 |  | 1235350 |
|  Daimler Trucks Finance North America LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.60%), 3.66%, 12/14/2023(a)(b) |  | 2000000 |  | 1990669 |
|  |  |  |  | **5551114** |
| **Media – 0.6%** | **Media – 0.6%** | **Media – 0.6%** | **Media – 0.6%** | **Media – 0.6%** |
|  Comcast Cable Communications Holdings, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 9.46%, 11/15/2022 |  | 1407000 |  | 1409406 |
|  Comcast Corp. | Comcast Corp. | Comcast Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.63%), 4.71%, 4/15/2024(a) |  | 1000000 |  | 998364 |
|  Discovery Communications LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 3/20/2023 |  | 2500000 |  | 2478151 |
|  |  |  |  | **4885921** |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 471

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** | **Multiline Retail – 0.1%** |
|  Dollar General Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 9/20/2024 | $840000 | $825113 |
| **Multi-Utilities – 1.7%** | **Multi-Utilities – 1.7%** | **Multi-Utilities – 1.7%** |
|  Ameren Illinois Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.38%, 6/15/2023 | 670000 | 649694 |
|  Black Hills Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.04%, 8/23/2024 | 960000 | 886187 |
|  CenterPoint Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.65%), 3.71%, 5/13/2024(a) | 760000 | 744172 |
|  Consolidated Edison, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series A, 0.65%, 12/1/2023 | 3600000 | 3435545 |
|  Dominion Energy, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series D, (ICE LIBOR USD 3 Month + 0.53%), 3.82%, 9/15/2023(a) | 2000000 | 1993759 |
|  DTE Energy Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series H, 0.55%, 11/1/2022 | 3000000 | 3000000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 11/1/2022 | 1082000 | 1082000 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.22%, 11/1/2024(d) | 1700000 | 1659861 |
|  Public Service Enterprise Group, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.65%, 11/15/2022 | 1380000 | 1378915 |
|  |  | **14830133** |
| **Oil, Gas & Consumable Fuels – 2.7%** | **Oil, Gas & Consumable Fuels – 2.7%** | **Oil, Gas & Consumable Fuels – 2.7%** |
|  Canadian Natural Resources Ltd. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 1/15/2023 | 3457000 | 3443383 |
|  ConocoPhillips Co. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.13%, 3/8/2024 | 1500000 | 1444321 |
|  Continental Resources, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 4/15/2023 | 3324000 | 3310172 |
|  Enbridge, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.40%), 3.47%, 2/17/2023(a) | 690000 | 688728 |
| &nbsp;&nbsp;&nbsp;&nbsp; (United States SOFR Compounded Index + 0.63%), 3.69%, 2/16/2024(a) | 4700000 | 4648038 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** | **Oil, Gas & Consumable Fuels – (continued)** |
|  EOG Resources, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.63%, 3/15/2023 | $| 2000000 | $| 1983567 |
|  Kinder Morgan, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.15%, 1/15/2023 |  | 1700000 |  | 1691856 |
|  MPLX LP |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.50%, 7/15/2023 |  | 2000000 |  | 1982612 |
|  NOVA Gas Transmission Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 7.88%, 4/1/2023 |  | 3000000 |  | 3032779 |
|  Phillips 66 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.70%, 4/6/2023 |  | 600000 |  | 596804 |
|  Saudi Arabian Oil Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.25%, 11/24/2023(b) |  | 200000 |  | 192004 |
|  TransCanada PipeLines Ltd. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.00%, 10/12/2024 |  | 520000 |  | 477371 |
|  |  |  |  | **23491635** |
| **Paper & Forest Products – 0.7%** | **Paper & Forest Products – 0.7%** | **Paper & Forest Products – 0.7%** | **Paper & Forest Products – 0.7%** | **Paper & Forest Products – 0.7%** |
|  Georgia-Pacific LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.73%, 7/15/2023(b) |  | 4000000 |  | 3959318 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.63%, 5/15/2024(b) |  | 2200000 |  | 2049641 |
|  |  |  |  | **6008959** |
| **Pharmaceuticals – 1.3%** | **Pharmaceuticals – 1.3%** | **Pharmaceuticals – 1.3%** | **Pharmaceuticals – 1.3%** | **Pharmaceuticals – 1.3%** |
|  AstraZeneca plc |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.30%, 5/26/2023 |  | 6425000 |  | 6262751 |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.67%), 3.61%, 8/17/2023(a) |  | 480000 |  | 479849 |
|  Bristol-Myers Squibb Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.54%, 11/13/2023 |  | 700000 |  | 669284 |
|  Merck & Co., Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.80%, 5/18/2023 |  | 695000 |  | 687750 |
|  Pfizer, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 6/15/2023 |  | 2490000 |  | 2463521 |
|  Shire Acquisitions Investments Ireland DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 9/23/2023 |  | 448000 |  | 437930 |
|  |  |  |  | **11001085** |
| **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** | **Road & Rail – 0.7%** |
|  Canadian Pacific Railway Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.35%, 12/2/2024 |  | 910000 |  | 839819 |
|  Ryder System, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.40%, 3/1/2023 |  | 3300000 |  | 3282849 |

---

*See Accompanying Notes to the Financial Statements.* 

472 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** | **CORPORATE BONDS – (continued)** |
| **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** | **Road & Rail – (continued)** |
|  SMBC Aviation Capital Finance DAC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.13%, 7/15/2023(b) | $| 700000 | $| 689669 |
|  Union Pacific Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 1/15/2023 |  | 600000 |  | 597756 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.50%, 6/8/2023 |  | 950000 |  | 941654 |
|  |  |  |  | **6351747** |
| **Semiconductors & Semiconductor Equipment – 0.9%** | **Semiconductors & Semiconductor Equipment – 0.9%** | **Semiconductors & Semiconductor Equipment – 0.9%** | **Semiconductors & Semiconductor Equipment – 0.9%** | **Semiconductors & Semiconductor Equipment – 0.9%** |
|  Analog Devices, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.25%), 3.30%, 10/1/2024(a) |  | 610000 |  | 600315 |
|  Microchip Technology, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.98%, 9/1/2024 |  | 870000 |  | 798423 |
|  NVIDIA Corp. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.31%, 6/15/2023 |  | 5320000 |  | 5173985 |
|  QUALCOMM, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.73%), 5.14%, 1/30/2023(a) |  | 970000 |  | 970488 |
|  |  |  |  | **7543211** |
| **Software – 1.0%** | **Software – 1.0%** | **Software – 1.0%** | **Software – 1.0%** | **Software – 1.0%** |
|  Roper Technologies, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.65%, 9/15/2023 |  | 4727000 |  | 4666924 |
|  VMware, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.60%, 8/15/2023 |  | 3590000 |  | 3456338 |
|  |  |  |  | **8123262** |
| **Specialty Retail – 0.3%** | **Specialty Retail – 0.3%** | **Specialty Retail – 0.3%** | **Specialty Retail – 0.3%** | **Specialty Retail – 0.3%** |
|  AutoZone, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.88%, 1/15/2023 |  | 860000 |  | 857239 |
|  O'Reilly Automotive, Inc. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 6/15/2023 |  | 1616000 |  | 1602067 |
|  |  |  |  | **2459306** |
| **Technology Hardware, Storage & Peripherals – 0.4%** | **Technology Hardware, Storage & Peripherals – 0.4%** | **Technology Hardware, Storage & Peripherals – 0.4%** | **Technology Hardware, Storage & Peripherals – 0.4%** | **Technology Hardware, Storage & Peripherals – 0.4%** |
|  Dell International LLC |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 5.45%, 6/15/2023 |  | 3015000 |  | 3010096 |
|  Hewlett Packard Enterprise Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.25%, 4/1/2023 |  | 400000 |  | 395339 |
|  |  |  |  | **3405435** |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **Trading Companies & Distributors – 0.8%** | **Trading Companies & Distributors – 0.8%** | **Trading Companies & Distributors – 0.8%** |
|  Air Lease Corp. | Air Lease Corp. |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (ICE LIBOR USD 3 Month + 0.35%), 3.64%, 12/15/2022(a) | $1500000 | $1498922 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.25%, 2/1/2024 | 1000000 | 979682 |
| &nbsp;&nbsp;&nbsp;&nbsp; 0.80%, 8/18/2024 | 980000 | 892368 |
|  GATX Corp. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.90%, 3/30/2023 | 3238000 | 3218923 |
|  |  | **6589895** |
| **Wireless Telecommunication Services – 1.1%** | **Wireless Telecommunication Services – 1.1%** | **Wireless Telecommunication Services – 1.1%** |
|  Rogers Communications, Inc. |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.00%, 3/15/2023 | 4919000 | 4880703 |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.10%, 10/1/2023 | 2000000 | 1974273 |
|  Vodafone Group plc |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 2/19/2023 | 2640000 | 2621616 |
|  |  | **9476592** |
| **Total Corporate Bonds <br>(Cost $657,377,295)** | **Total Corporate Bonds <br>(Cost $657,377,295)** | **647247156** |
| **ASSET–BACKED SECURITIES – 2.8%** | **ASSET–BACKED SECURITIES – 2.8%** | **ASSET–BACKED SECURITIES – 2.8%** |
|  AmeriCredit Automobile Receivables Trust |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2021-2, Class A2, 0.26%, 11/18/2024 | 1086926 | 1083281 |
|  Carmax Auto Owner Trust | Carmax Auto Owner Trust | Carmax Auto Owner Trust |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-3, Class A2A, 3.81%, 9/15/2025 | 1562000 | 1541211 |
|  Enterprise Fleet Financing LLC | Enterprise Fleet Financing LLC | Enterprise Fleet Financing LLC |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2019-2, Class A2, 2.29%, 2/20/2025(b) | 63843 | 63687 |
|  Ford Credit Auto Lease Trust | Ford Credit Auto Lease Trust | Ford Credit Auto Lease Trust |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-A, Class A2A, 2.78%, 10/15/2024 | 748819 | 738639 |
|  Ford Credit Auto Owner Trust | Ford Credit Auto Owner Trust | Ford Credit Auto Owner Trust |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-C, Class A2A, 4.52%, 4/15/2025 | 3500000 | 3482201 |
|  GM Financial Automobile Leasing Trust |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-3, Class A2A, 4.01%, 10/21/2024 | 3000000 | 2970750 |

---

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 473

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **ASSET–BACKED SECURITIES – (continued)** | **ASSET–BACKED SECURITIES – (continued)** | **ASSET–BACKED SECURITIES – (continued)** | **ASSET–BACKED SECURITIES – (continued)** | **ASSET–BACKED SECURITIES – (continued)** |
|  GM Financial Consumer Automobile Receivables Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-1, Class A4, 1.90%, 3/17/2025 | $| 500000 | $| 486805 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-3, Class A2A, 3.50%, 9/16/2025 |  | 1875000 |  | 1849668 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2021-3, Class A3, 0.48%, 6/16/2026 |  | 1500000 |  | 1419626 |
|  Honda Auto Receivables Owner Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-2, Class A2, 3.81%, 3/18/2025 |  | 1400000 |  | 1384378 |
|  Hyundai Auto Receivables Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-A, Class A2A, 1.81%, 2/18/2025 |  | 1126132 |  | 1105119 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-B, Class A2A, 3.64%, 5/15/2025 |  | 1000000 |  | 988821 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-B, Class A4, 0.62%, 12/15/2025 |  | 1439000 |  | 1376299 |
|  Nissan Auto Receivables Owner Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-B, Class A2, 4.50%, 8/15/2025 |  | 3000000 |  | 2972458 |
|  Santander Drive Auto Receivables Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-1, Class A2, 1.36%, 12/16/2024 |  | 656495 |  | 653631 |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022-2, Class A2, 2.12%, 10/15/2026 |  | 949061 |  | 943374 |
|  Toyota Auto Receivables Owner Trust |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-B, Class A3, 1.36%, 8/15/2024 |  | 378101 |  | 373296 |
|  Verizon Owner Trust | Verizon Owner Trust | Verizon Owner Trust | Verizon Owner Trust | Verizon Owner Trust |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-A, Class A1A, 1.85%, 7/22/2024 |  | 409476 |  | 407350 |
| **Total Asset-Backed Securities <br>(Cost $24,036,082)** | **Total Asset-Backed Securities <br>(Cost $24,036,082)** | **Total Asset-Backed Securities <br>(Cost $24,036,082)** |  | **23840594** |
| **MUNICIPAL BONDS – 0.7%** | **MUNICIPAL BONDS – 0.7%** | **MUNICIPAL BONDS – 0.7%** | **MUNICIPAL BONDS – 0.7%** | **MUNICIPAL BONDS – 0.7%** |
|  University of Missouri, System Facilities Revenue Bonds |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-A, 1.47%, 11/1/2023 |  | 1000000 |  | 967325 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value | Value |
| **MUNICIPAL BONDS – (continued)** | **MUNICIPAL BONDS – (continued)** | **MUNICIPAL BONDS – (continued)** | **MUNICIPAL BONDS – (continued)** | **MUNICIPAL BONDS – (continued)** |
|  City of New York | City of New York | City of New York |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2021-D, 0.59%, 8/1/2023 | $| 1800000 | $| 1744876 |
|  Anaheim Public Financing Authority |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2021-A, 0.63%, 7/1/2024 |  | 500000 |  | 465271 |
|  Miami-Dade County, Capital Asset Acquisition Special Obligation Bonds |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2020-B, 0.38%, 4/1/2023 |  | 1110000 |  | 1090299 |
|  New York City Transitional Finance Authority, Building Aid |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series 2022 Subseries S-1B, 0.64%, 7/15/2024 |  | 1000000 |  | 931181 |
|  |  |  |  | **2486751** |
|  Port Authority of New York & New Jersey |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Series AAA, 1.09%, 7/1/2023 |  | 1000000 |  | 975349 |
| **Total Municipal Bonds <br>(Cost $6,409,425)** | **Total Municipal Bonds <br>(Cost $6,409,425)** | **Total Municipal Bonds <br>(Cost $6,409,425)** |  | **6174301** |
| **U.S. GOVERNMENT AGENCY SECURITIES – 0.2%** | **U.S. GOVERNMENT AGENCY SECURITIES – 0.2%** | **U.S. GOVERNMENT AGENCY SECURITIES – 0.2%** | **U.S. GOVERNMENT AGENCY SECURITIES – 0.2%** | **U.S. GOVERNMENT AGENCY SECURITIES – 0.2%** |
|  FFCB | FFCB | FFCB |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; (SOFR + 0.04%), 3.09%, 2/5/2024(a) (Cost $1,800,000) |  | 1800000 |  | 1799324 |
| **FOREIGN GOVERNMENT SECURITIES – 0.1%** | **FOREIGN GOVERNMENT SECURITIES – 0.1%** | **FOREIGN GOVERNMENT SECURITIES – 0.1%** | **FOREIGN GOVERNMENT SECURITIES – 0.1%** | **FOREIGN GOVERNMENT SECURITIES – 0.1%** |
|  Japan Bank for International Cooperation |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 1.75%, 1/23/2023<br> (Cost $799,802) |  | 800000 |  | 795096 |
| **SHORT-TERM INVESTMENTS – 20.9%** | **SHORT-TERM INVESTMENTS – 20.9%** | **SHORT-TERM INVESTMENTS – 20.9%** | **SHORT-TERM INVESTMENTS – 20.9%** | **SHORT-TERM INVESTMENTS – 20.9%** |
| **COMMERCIAL PAPER – 3.1%** | **COMMERCIAL PAPER – 3.1%** | **COMMERCIAL PAPER – 3.1%** | **COMMERCIAL PAPER – 3.1%** | **COMMERCIAL PAPER – 3.1%** |
|  Ameren Illinois Co. |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 4.16%, 11/22/2022(e) |  | 5000000 |  | 4987983 |
|  Credit Agricole Corporate and Investment Bank |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.04%, 11/4/2022(e) |  | 5000000 |  | 4998191 |

---

*See Accompanying Notes to the Financial Statements.* 

474 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

FlexShares® Ready Access Variable Income Fund (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Investments | Principal<br>Amount | Principal<br>Amount | Value |
| **SHORT-TERM INVESTMENTS – (continued)** | **SHORT-TERM INVESTMENTS – (continued)** | **SHORT-TERM INVESTMENTS – (continued)** | **SHORT-TERM INVESTMENTS – (continued)** |
| **COMMERCIAL PAPER – (continued)** | **COMMERCIAL PAPER – (continued)** | **COMMERCIAL PAPER – (continued)** | **COMMERCIAL PAPER – (continued)** |
|  MUFG Bank Ltd. |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.31%, 1/23/2023(e) | $| 7000000 | $6930485 |
|  Peoples Gas Light & Coke Co. (The) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.37%, 11/2/2022(e) |  | 5000000 | 4999097 |
|  Swedbank AB |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.76%, 1/25/2023(e) |  | 5000000 | 4947910 |
| **Total Commercial Paper<br>(Cost $26,889,750)** | **Total Commercial Paper<br>(Cost $26,889,750)** | **Total Commercial Paper<br>(Cost $26,889,750)** | **26863666** |
| **U.S. TREASURY OBLIGATIONS – 17.8%** | **U.S. TREASURY OBLIGATIONS – 17.8%** | **U.S. TREASURY OBLIGATIONS – 17.8%** | **U.S. TREASURY OBLIGATIONS – 17.8%** |
|  U.S. Treasury Bills |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.12%, 12/6/2022(e) |  | 32000000 | 31890528 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.91%, 12/20/2022(e) |  | 18400000 | 18307215 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2.95%, 1/19/2023(e) |  | 40000000 | 39652839 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.06%, 2/9/2023(e) |  | 10000000 | 9887361 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.09%, 2/16/2023(e) |  | 10000000 | 9879179 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.39%, 3/9/2023(e) |  | 18000000 | 17732160 |
| &nbsp;&nbsp;&nbsp;&nbsp; 3.85%, 3/23/2023(e) |  | 25000000 | 24586018 |
| **Total U.S. Treasury Obligations <br>(Cost $152,216,013)** | **Total U.S. Treasury Obligations <br>(Cost $152,216,013)** | **Total U.S. Treasury Obligations <br>(Cost $152,216,013)** | **151935300** |
| **Total Short-Term Investments <br>(Cost $179,105,763)** | **Total Short-Term Investments <br>(Cost $179,105,763)** | **Total Short-Term Investments <br>(Cost $179,105,763)** | **178798966** |
| **Total Investments – 100.3% <br>(Cost $869,528,367)** | **Total Investments – 100.3% <br>(Cost $869,528,367)** | **Total Investments – 100.3% <br>(Cost $869,528,367)** | **858655437** |
|  Liabilities in excess of other assets – (0.3%) | Liabilities in excess of other assets – (0.3%) | Liabilities in excess of other assets – (0.3%) | (2298507) |
| **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | **NET ASSETS – 100.0%** | $**856356930** |

---

*<sup>(a)</sup>* *Variable or floating rate security, linked to the referenced benchmark. The interest rate shown is the rate in effect as of October 31, 2022.* 

*<sup>(b)</sup>* *Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.* 

*<sup>(c)</sup>* *Security issued at a fixed coupon rate, which converts to a variable rate at a future date. Rate shown is the rate in effect as of period end.* 

*<sup>(d)</sup>* *Step bond. Interest rate is a fixed rate for an initial period that either resets at a specific date or may reset in the future at a contingent upon predetermined trigger. The interest rate shown was the current rate as of October 31, 2022.* 

*<sup>(e)</sup>* *The rate shown was the current yield as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*Abbreviations* 

*ICE – Intercontinental Exchange* 

*LIBOR – London Interbank Offered Rate* 

*SOFR – Secured Overnight Financing Rate* 

*USD – US Dollar* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $31955 |
|  Aggregate gross unrealized depreciation | (10999488) |
|  Net unrealized depreciation | $(10967533) |
|  Federal income tax cost | $869622970 |

---

*FlexShares<sup>®</sup> Ready Access Variable Income Fund invested, as a percentage of net assets, in companies domiciled in the following countries as of October 31, 2022:* 

---

| | |
|:---|:---|
|  Australia | 3.3 |
|  Canada | 7.9 |
|  Finland | 0.3 |
|  France | 1.6 |
|  Germany | 2.1 |
|  Ireland | 0.3 |
|  Japan | 1.9 |
|  Netherlands | 0.9 |
|  New Zealand | 0.6 |
|  Saudi Arabia | 0.0 |
|  South Korea | 0.1 |
|  Spain | 0.7 |
|  Sweden | 2.0 |
|  Switzerland | 1.3 |
|  United Kingdom | 3.4 |
|  United States | 73.9 |
|  Other<sup>1</sup> | (0.3 |
|  | 100.0 |

---

---

| | |
|:---|:---|
| *<sup>†</sup>* | *Amount represents less than 0.05%.*  |

---

*<sup>1</sup>* *Includes any non-fixed-income securities and net other assets (liabilities).* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Corporate Bonds | 75.6% |
|  Asset-Backed Securities | 2.8 |
|  Municipal Bonds | 0.7 |
|  U.S. Government Agency Securities | 0.2 |
|  Foreign Government Securities | 0.1 |
|  Short-Term Investments | 20.9 |
|  Others<sup>(1)</sup> | (0.3) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 475

------

##### [**Table of Contents**](#toc)

------

## Schedule of Investments

## FlexShares® Core Select Bond Fund
October 31, 2022

------

---

| | | |
|:---|:---|:---|
| Investments | Shares | Value |
| **EXCHANGE TRADED FUNDS – 98.3%** | **EXCHANGE TRADED FUNDS – 98.3%** | **EXCHANGE TRADED FUNDS – 98.3%** |
|  FlexShares<sup>®</sup> Credit- Scored US Corporate Bond Index Fund(a) | 246462 | $11170323 |
|  FlexShares<sup>®</sup> Credit- Scored US Long Corporate Bond Index Fund(a) | 20165 | 797284 |
|  FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund(a) | 1073557 | 21492612 |
|  FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund(a) | 271016 | 6398688 |
|  FlexShares<sup>®</sup> Ready Access Variable Income Fund(a) | 215476 | 16002325 |
|  iShares 10+ Year Investment Grade Corporate Bond ETF(b) | 296298 | 13899339 |
|  iShares 20+ Year Treasury Bond ETF | 140987 | 13550260 |
|  iShares 3-7 Year Treasury Bond ETF(b) | 193330 | 21950688 |
|  iShares 5-10 Year Investment Grade Corporate Bond ETF | 116498 | 5579089 |
|  iShares 7-10 Year Treasury Bond ETF(b) | 121568 | 11477235 |
|  iShares MBS ETF(b) | 237518 | 21457376 |
|  iShares Trust iShares 1-5 Year Investment Grade Corporate Bond ETF | 260643 | 12787146 |
| **Total Exchange Traded Funds<br>(Cost $170,117,570)** | **Total Exchange Traded Funds<br>(Cost $170,117,570)** | **156562365** |
|  | Principal<br>Amount |  |
| **SECURITIES LENDING REINVESTMENTS(c) – 34.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 34.8%** | **SECURITIES LENDING REINVESTMENTS(c) – 34.8%** |
| **REPURCHASE AGREEMENTS – 34.8%** | **REPURCHASE AGREEMENTS – 34.8%** |  |
|  CF Secured LLC, 3.00%, dated 10/31/2022, due 11/1/2022, repurchase price $55,529,711, collateralized by various U.S. Treasury Securities, ranging from 0.00% – 7.63%, maturing 11/15/2022 – 8/15/2052; total market value $56,333,955 (Cost $55,525,084) | $55525084 | $55525084 |

---

---

| | | |
|:---|:---|:---|
| Investments | Principal<br>Amount | Value |
| **SHORT-TERM INVESTMENTS – 0.6%** | **SHORT-TERM INVESTMENTS – 0.6%** | **SHORT-TERM INVESTMENTS – 0.6%** |
| **U.S. TREASURY OBLIGATIONS – 0.6%** | **U.S. TREASURY OBLIGATIONS – 0.6%** | **U.S. TREASURY OBLIGATIONS – 0.6%** |
|  U.S. Treasury Bills 2.45%, 12/29/2022(d)(e)<br>(Cost $996,098) | $&nbsp;&nbsp;&nbsp;&nbsp;1000000 | $993846 |
| **Total Investments – 133.7%<br>(Cost $226,638,752)** | **Total Investments – 133.7%<br>(Cost $226,638,752)** | **213081295** |
|  Liabilities in excess of other assets – (33.7%) | Liabilities in excess of other assets – (33.7%) | (53719216) |
| **NET ASSETS – 100.0%** |  | $**159362079** |

---

*<sup>(a)</sup>* *Investment in affiliated Fund. Northern Trust Investments, Inc. is the Investment Adviser to both the Fund and the affiliated Funds.* 

*<sup>(b)</sup>* *The security or a portion of this security is on loan at October 31, 2022. The total value of securities on loan at October 31, 2022 was $53,981,888, collateralized in the form of cash that was reinvested in the securities shown in the Securities Lending Reinvestment section of the Schedule of Investments; a total value of $55,525,084.* 

*<sup>(c)</sup>* *The security was purchased with cash collateral held from securities on loan at October 31, 2022. The total value of securities purchased was $55,525,084.* 

*<sup>(d)</sup>* *All or a portion of the security pledged as collateral for Futures Contracts.* 

*<sup>(e)</sup>* *The rate shown was the current yield as of October 31, 2022.* 

*Percentages shown are based on Net Assets.* 

*As of October 31, 2022, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative instruments, if applicable) for federal income tax purposes was as follows:* 

---

| | |
|:---|:---|
|  Aggregate gross unrealized appreciation | $— |
|  Aggregate gross unrealized depreciation | (19710061) |
|  Net unrealized depreciation | $(19710061) |
|  Federal income tax cost | $232787396 |

---

*See Accompanying Notes to the Financial Statements.* 

476 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

FlexShares® Core Select Bond Fund (cont.)

------

*For the period ended October 31, 2022, the FlexShares<sup>®</sup> Core Select Bond Fund was invested in securities of affiliated FlexShares<sup>®</sup> Funds. The Schedules of Investments of the affiliated FlexShares<sup>®</sup> Funds are located elsewhere in this Report.* 

*Investment in a company which was affiliated for the period ended October 31, 2022, was as follows:* 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Security | Value<br>October 31,<br> 2021 | Purchases<br>at Cost | Sales<br> Proceeds | Shares<br>October 31,<br> 2022 | Value<br>October 31,<br> 2022 | Change in<br>Unrealized<br>Appreciation<br>(Depreciation) | Dividend<br>Income | Realized Loss |
|  FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund | $37734108 | $19206977 | $41828355 | 246462 | $11170323 | $(572482) | $468615 | $(3369925) |
|  FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund | 5998595 | 3519814 | 7010564 | 20165 | 797284 | (423099) | 166834 | (1287462) |
|  FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund | 14831201 | 31930651 | 21371553 | 1073557 | 21492612 | (1477314) | 620847 | (2420373) |
|  FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund |  | 14513817 | 7171421 | 271016 | 6398688 | (502806) | 458466 | (440902) |
|  FlexShares<sup>®</sup> Ready Access Variable Income Fund | 2015253 | 41904035 | 27788196 | 215476 | 16002325 | (23306) | 72553 | (105461) |
|  | $60579157 | $111075294 | $105170089 | 1826676 | $55861232 | $(2999007) | $1787315 | $(7624123) |

---

**Futures Contracts** 

*FlexShares<sup>®</sup> Core Select Bond Fund had the following open futures contracts as of October 31, 2022:* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Number of<br>Contracts | Expiration<br>Date | Trading<br>Currency | Notional<br>Amount | Value and<br>Unrealized<br>Depreciation\* |
|  **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** | **Long Contracts** |
|  U.S. Treasury 2 Year Note | 29 | 12/30/2022 | USD | $5927102 | $(3960) |

---

*\** *This amount represents the cumulative appreciation/depreciation on futures contracts. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

*Abbreviations:* 

*USD – US Dollar* 

---

| | |
|:---|:---|
| Security Type | % of Net Assets |
|  Exchange Traded Funds | 98.3% |
|  Securities Lending Reinvestments | 34.8 |
|  Short-Term Investments | 0.6 |
|  Others<sup>(1)</sup>  | (33.7) |
|  | 100.0% |

---

*<sup>(1)</sup>* *Includes any other net assets/(liabilities).* 

*See Accompanying Notes to the Financial Statements.* 

FLEXSHARES ANNUAL REPORT 477

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## Notes to the Financial Statements October 31, 2022

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**1. Organization** 

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FlexShares<sup>®</sup> Trust (the "Trust"), a Maryland statutory trust, was formed on May 13, 2010, originally named NT ETF Trust and renamed FlexShares<sup>®</sup> Trust as of April 12, 2011. The Trust is registered as an open-end management investment company under the Investment Company Act of 1940 (the "1940 Act"), as amended. The Trust consists of thirty-two operational exchange-traded funds as of October 31, 2022 (each a "Fund" and collectively, the "Funds").

The FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund commenced operations during the reporting period on April 20, 2022.

FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund, FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, and FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund are non-diversified series of the Trust, pursuant to the 1940 Act.

The FlexShares<sup>®</sup> US Quality Low Volatility Index Fund, FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund, and FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund, FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund, FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund, FlexShares<sup>®</sup> US Quality Large Cap Index Fund, FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares<sup>®</sup> Quality Dividend Index Fund, FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund, FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund, FlexShares<sup>®</sup> International Quality Dividend Index Fund, FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund, FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund, FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund, FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund, FlexShares<sup>®</sup> Global Quality Real Estate Index Fund, FlexShares<sup>®</sup> Real Assets Allocation Index Fund, FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares<sup>®</sup>

iBoxx 5-Year Target Duration TIPS Index Fund, FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund, FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund, FlexShares<sup>®</sup> Ready Access Variable Income Fund and the FlexShares<sup>®</sup> Core Select Bond Fund are diversified series of the Trust, pursuant to the 1940 Act.

Each Fund, except the FlexShares Ready Access Variable Income Fund and the FlexShares Core Select Bond Fund, seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of a specified benchmark index (each an "Underlying Index"). The FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund seek to track Underlying Indexes developed by Northern Trust Investments, Inc. ("NTI" or "Investment Adviser"), an indirect subsidiary of Northern Trust Corporation. The FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund and FlexShares Morningstar Global Upstream Natural Resources Index Fund seek to track Underlying Indexes sponsored by Morningstar, Inc. The FlexShares STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, and FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund seek

478 FLEXSHARES ANNUAL REPORT

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Notes to the Financial Statements (cont.)

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to track Underlying Indexes sponsored by STOXX. The FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and FlexShares iBoxx 5-Year Target Duration TIPS Index Fund seek to track Underlying Indexes sponsored by Markit Indexes Limited. The FlexShares Disciplined Duration MBS Index Fund seeks to track an Underlying Index sponsored by ICE Data Indexes, LLC.

The FlexShares Real Assets Allocation Index Fund is a fund of funds that seeks to achieve its investment objective by investing primarily in the shares of other FlexShares ETFs that are eligible for inclusion in its Underlying Index, rather than in securities of individual companies. The FlexShares Core Select Bond Fund seeks to achieve its investment objective by investing, under normal circumstances in U.S. dollar-denominated investment-grade fixed-income securities either directly or indirectly through FlexShares ETFs, unaffiliated ETFs and other registered investment companies. The investment performance of each of the FlexShares Real Assets Allocation Index Fund and FlexShares Core Select Bond Fund is directly related to the performance of the underlying funds in which it invests ("Underlying Fund").

The FlexShares Ready Access Variable Income Fund and the FlexShares Core Select Bond Fund are actively managed and do not seek to replicate the performance of a specified index. The FlexShares Ready Access Variable Income Fund seeks maximum current income consistent with the preservation of capital and liquidity. The FlexShares Core Select Bond Fund seeks total return and preservation of capital. Each Fund, except the FlexShares Ready Access Variable Income Fund and the FlexShares Core Select Bond Fund, is referred to herein as an "Index Fund." Each Fund is managed by the Investment Adviser.

**2. Significant Accounting Policies** 

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The Trust, which is an investment company, follows accounting and reporting guidance under Financial Accounting Standards Board ("FASB") Accounting Standards Codification Topic 946, "Financial Services-Investment Companies." The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America

("U.S. GAAP"). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

**Investment Valuation** 

Each Fund's net asset value ("NAV") is determined daily as of the close of regular trading on the New York Stock Exchange ("NYSE"), normally 4:00 p.m. Eastern time, on each day the NYSE is open for trading, based on prices at the time of closing provided that any U.S. fixed-income assets may be valued as of the announced closing time for trading in fixed-income instruments on any day that the Securities Industry and Financial Markets Association announces an early closing time. The NAV of a Fund is calculated by dividing the value of all assets of the Fund (including accrued interest and dividends), less all liabilities (including accrued expenses and dividends declared but unpaid), by the total number of shares outstanding.

The investments of the Funds are valued at fair value pursuant to the pricing policy and procedures approved by the Trust's Board of Trustees ("Board"). The Funds' investments are valued using market quotations when available. The Board has designated NTI as the valuation designee pursuant to Rule 2a-5 under the 1940 Act to perform fair value determinations relating to any or all Fund investments. Accordingly, when market quotations are not readily available, are deemed unreliable, or do not reflect material events occurring between the close of local markets and the time of valuation, NTI values Fund securities at fair value as determined in good faith in accordance with the Funds' fair value pricing procedures as approved by the Board. Such circumstances include periods when trading in a security is suspended, the exchange or market on which a security trades closes early, the trading volume in a security is limited, corporate actions and announcements take place, or regulatory news affecting an issuer is released, such as government approvals. The Board oversees NTI in its role as valuation designee in accordance with the requirements of Rule 2a-5 under the 1940 Act. Additionally, NTI, in its discretion, may make adjustments to the prices of securities held by a Fund if an event occurs after the publication of

FLEXSHARES ANNUAL REPORT 479

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Notes to the Financial Statements (cont.)

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market values normally used by NTI on behalf of a Fund but before the time as of which the Fund calculates its NAV, depending on the nature and significance of the event, consistent with applicable regulatory guidance and the Trust's fair value procedures. Other events that can trigger fair valuing of foreign securities include, for example, significant fluctuations in general market indicators, government actions, or natural disasters.

The use of fair valuation involves the risk that the values used by NTI to price a Fund's investments may be higher or lower than the values used by other investment companies and investors to price the same investments. Fair value pricing involves subjective judgments and it is possible that a fair value determination for a portfolio security may be materially different than the value that could be realized upon the sale of such security. In addition, fair value pricing could result in a difference between the prices used to calculate an Index Fund's NAV and the prices used by an Index Fund's Underlying Index. This difference may adversely affect an Index Fund's ability to track its Underlying Index. Portfolio securities of certain Funds are listed on foreign exchanges and their value may change on days when shareholders will not be able to purchase or sell Fund shares.

Security prices are generally provided by independent pricing services. Portfolio securities listed or traded on domestic securities exchanges or the NASDAQ/NMS, including dollar-denominated foreign securities or American Depositary Receipts ("ADRs"), are valued at the closing price, or last sale price, reported on the exchange or system where the security is principally traded. The closing price for securities traded on the NASDAQ/NMS is the Nasdaq Official Closing Price ("NOCP"). If there have been no sales for that day on the exchange or system where the security is principally traded, then the value is determined with reference to the last sale price, or the NOCP, if applicable, on any other exchange or system. If there have been no sales of the security for that day on any exchange or system, the security is valued at fair value pursuant to the Trust's fair value procedures.

Securities that are traded regularly in the over-the-counter market (other than the NASDAQ/NMS), including securities listed on exchanges but primarily traded over-the-counter, are valued on the basis of bid quotes or

the mean between the bid and asked quotes based upon quotes furnished by one or more broker-dealers or market makers for those securities. Securities that may be traded over-the-counter include equity securities, fixed-income securities, non-exchange-listed foreign securities, and certain derivative instruments. Fixed-income securities may be valued using prices provided directly from one or more broker-dealers, market makers, or independent third-party pricing services which may use matrix pricing and valuation models, as well as recent market transactions for the same or similar assets, to derive values when such prices are believed to reflect fair market values of such securities. Such prices may be determined by taking into account securities prices, yields, maturities, call features, ratings, prepayment speeds, credit risks, cash flows, institutional size trading in similar groups of securities and developments related to specific securities. Fixed-income securities maturing within a relatively short period, less than 60 days, are valued at amortized cost when it approximates fair value.

Foreign equity securities are generally priced at the closing price or last sales price reported on the foreign exchange on which they are principally traded. If there have been no sales for that day on the primary exchange, then the value is determined with reference to the last sale price on any other exchange. If there have been no sales of the security for that day on any exchange, the security will be valued at fair value pursuant to the Trust's fair value procedures. Spot and forward foreign currency exchange contracts generally are valued using an independent pricing service. The value of assets denominated in foreign currencies is converted into U.S. dollars using exchange rates deemed appropriate by NTI as Investment Adviser. Any use of a different rate from the rates used by an Underlying Index's index provider may adversely affect an Index Fund's ability to track its Underlying Index. An Underlying Index's index provider determines the composition and relative weightings of the securities in the Underlying Index and publishes information regarding the market value of the Underlying Index.

Exchange-traded financial futures and options thereon are valued at the settlement price as established by the exchange on which they are traded. Over-the-counter options are

480 FLEXSHARES ANNUAL REPORT

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Notes to the Financial Statements (cont.)

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valued at broker-provided bid prices, as are swaps. The foregoing prices may be obtained from one or more

independent pricing services or, as needed or applicable, independent broker-dealers. If there was no sale on that day, and for other non-exchange traded derivatives, the contract is valued at fair value pursuant to the Trust's fair value procedures.

Each Fund relies on various sources to calculate its NAV. The ability of the Funds' administrator to calculate the NAV per share of the Funds is subject to operational risks associated with processing or human errors, systems or technology failures, and errors caused by third party service providers, data sources, or trading counterparties. Such failures may result in delays in the calculation of the Funds' NAVs and/or the inability to calculate NAV over extended time periods. The Funds may be unable to recover any losses associated with such failures, and it may be necessary for alternative procedures to be followed to price portfolio securities when determining the Funds' NAVs.

Various inputs are used in determining the value of each Fund's investments. These inputs are summarized in three levels listed below:

• Level 1—Quoted prices in active markets for identical assets on the measurement date.

• Level 2—Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).

• Level 3—Significant unobservable inputs (including the Funds' own assumptions in determining the fair value of investments).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, short-term debt securities may be valued at amortized cost, as long as amortized cost approximates the current fair value of a security, but since the valuation is not obtained from a quoted price in an active market, such securities are reflected as Level 2.

The following is a summary of the valuations as of October 31, 2022 for each Fund based upon the three levels defined above. The value of level 3 securities compared to the total Fund net assets is not material and, therefore, the reconciliation of Level 3 securities and related valuation techniques are not disclosed. Please refer to the Schedules of Investments to view equity and debt securities segregated by industry type, where applicable.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br> Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares US Quality Low Volatility Index Fund** | **FlexShares US Quality Low Volatility Index Fund** | **FlexShares US Quality Low Volatility Index Fund** | **FlexShares US Quality Low Volatility Index Fund** | **FlexShares US Quality Low Volatility Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $161941078 | $— | $— | $161941078 |
|  Securities Lending Reinvestments Repurchase Agreements |  | 1156911 |  | 1156911 |
| Short-Term Investments |  | 34924 |  | 34924 |
| Total Investments | $161941078 | $1191835 | $— | $163132913 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $7830 | $— | $— | $7830 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (1033) |  |  | (1033) |
| Total Other Financial Instruments | $6797 | $— | $— | $6797 |

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FLEXSHARES ANNUAL REPORT 481

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Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares Developed Markets ex-US Quality Low Volatility Index Fund** |
|  **Investments** | **Investments** | **Investments** | **Investments** | **Investments** |
|  Common Stocks\* | $60676378 | $— | $— | $60676378 |
| Securities Lending Reinvestments Repurchase Agreements |  | 481336 |  | 481336 |
| Total Investments | $60676378 | $481336 | $— | $61157714 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $16928 | $— | $16928 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (42523) |  |  | (42523) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (1982) |  | (1982) |
| Total Other Financial Instruments | $(42523) | $14946 | $— | $(27577) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Emerging Markets Quality Low Volatility Index Fund** | **FlexShares Emerging Markets Quality Low Volatility Index Fund** | **FlexShares Emerging Markets Quality Low Volatility Index Fund** | **FlexShares Emerging Markets Quality Low Volatility Index Fund** | **FlexShares Emerging Markets Quality Low Volatility Index Fund** |
|  **Investments** |  |  |  |  |
| Common Stocks\* | $8151646 | $— | $— | $8151646 |
| Total Investments | $8151646 | $— | $— | $8151646 |
|  **Other Financial Instruments** |  |  |  |  |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(7669) | $— | $— | $(7669) |
| Total Other Financial Instruments | $(7669) | $— | $— | $(7669) |

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482 FLEXSHARES ANNUAL REPORT

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Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Morningstar US Market Factor Tilt Index Fund** | **FlexShares Morningstar US Market Factor Tilt Index Fund** | **FlexShares Morningstar US Market Factor Tilt Index Fund** | **FlexShares Morningstar US Market Factor Tilt Index Fund** | **FlexShares Morningstar US Market Factor Tilt Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Food & Staples Retailing | $17677139 | $177 | $— | $17677316 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 1367413363 |  |  | 1367413363 |
|  Rights |  |  | 30394 | 30394 |
|  Warrants | 215860 |  |  | 215860 |
|  Securities Lending Reinvestments  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposit |  | 28995047 |  | 28995047 |
| &nbsp;&nbsp;&nbsp;&nbsp; Commercial Paper |  | 6000000 |  | 6000000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Repurchase Agreements |  | 168821768 |  | 168821768 |
| Total Investments | $1385306362 | $203816992 | $30394 | $1589153748 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $285430 | $— | $— | $285430 |
| Total Other Financial Instruments | $285430 | $— | $— | $285430 |

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FLEXSHARES ANNUAL REPORT 483

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Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund** |
|  **Investments** |  |  |  |  |
|  Closed End Funds | $51056 | $— | $— | $51056 |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Banks | 46576959 | 925 |  | 46577884 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diversified Telecommunication Services | 5460247 | 52080 |  | 5512327 |
| &nbsp;&nbsp;&nbsp;&nbsp; Energy Equipment & Services | 1806715 | 41632 |  | 1848347 |
| &nbsp;&nbsp;&nbsp;&nbsp; Health Care Providers & Services | 2263468 | 62 |  | 2263530 |
| &nbsp;&nbsp;&nbsp;&nbsp; Internet & Direct Marketing Retail | 1532705 | 21629 |  | 1554334 |
| &nbsp;&nbsp;&nbsp;&nbsp; Metals & Mining | 21516863 |  | 39717 | 21556580 |
| &nbsp;&nbsp;&nbsp;&nbsp; Oil, Gas & Consumable Fuels | 29755266 | 64801 |  | 29820067 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 326289109 |  |  | 326289109 |
|  Rights |  |  |  |  |
|  Warrants |  |  |  |  |
| Securities Lending Reinvestments Repurchase Agreements |  | 7591069 |  | 7591069 |
| Total Investments | $435252388 | $7772198 | $39717 | $443064303 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $125896 | $— | $— | $125896 |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | 53896 |  | 53896 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (63678) |  |  | (63678) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (105386) |  | (105386) |
| Total Other Financial Instruments | $62218 | $(51490) | $— | $10728 |

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484 FLEXSHARES ANNUAL REPORT

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Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares Morningstar Emerging Markets Factor Tilt Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Chemicals | $9423391 | $133788 | $— | $9557179 |
| &nbsp;&nbsp;&nbsp;&nbsp; Commercial Services & Supplies | 332450 | 33725 |  | 366175 |
| &nbsp;&nbsp;&nbsp;&nbsp; Entertainment | 1334528 |  | 7362 | 1341890 |
| &nbsp;&nbsp;&nbsp;&nbsp; Equity Real Estate Investment Trusts (REITs) | 2638017 | 21436 |  | 2659453 |
| &nbsp;&nbsp;&nbsp;&nbsp; Food & Staples Retailing | 2314053 | 450 |  | 2314503 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hotels, Restaurants & Leisure | 1683510 | 2134 |  | 1685644 |
| &nbsp;&nbsp;&nbsp;&nbsp; Metals & Mining | 9654747 | 15064 | 129635 | 9799446 |
| &nbsp;&nbsp;&nbsp;&nbsp; Oil, Gas & Consumable Fuels | 10977378 | 2224 |  | 10979602 |
| &nbsp;&nbsp;&nbsp;&nbsp; Pharmaceuticals | 2799861 | 5020 | 3378 | 2808259 |
| &nbsp;&nbsp;&nbsp;&nbsp; Real Estate Management & Development | 6221522 | 206014 | 122435 | 6549971 |
| &nbsp;&nbsp;&nbsp;&nbsp; Transportation Infrastructure | 2030410 | 104283 |  | 2134693 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 155815515 |  |  | 155815515 |
|  Corporate Bonds\* |  | 7923 |  | 7923 |
|  Rights | 204 | 4656 |  | 4860 |
| Securities Lending Reinvestments Repurchase Agreements |  | 3027697 |  | 3027697 |
| Total Investments | $205225586 | $3564414 | $262810 | $209052810 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $37421 | $— | $37421 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (177121) |  |  | (177121) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (32909) |  | (32909) |
| Total Other Financial Instruments | $(177121) | $4512 | $— | $(172609) |

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FLEXSHARES ANNUAL REPORT 485

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares US Quality Large Cap Index Fund** | **FlexShares US Quality Large Cap Index Fund** | **FlexShares US Quality Large Cap Index Fund** | **FlexShares US Quality Large Cap Index Fund** | **FlexShares US Quality Large Cap Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $125453875 | $— | $— | $125453875 |
| Securities Lending Reinvestments Repurchase Agreements |  | 264465 |  | 264465 |
| Total Investments | $125453875 | $264465 | $— | $125718340 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $10322 | $— | $— | $10322 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (58578) |  |  | (58578) |
| Total Other Financial Instruments | $(48256) | $— | $— | $(48256) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> US ESG Select Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $170751844 | $— | $— | $170751844 |
| Securities Lending Reinvestments Repurchase Agreements |  | 225693 |  | 225693 |
| Total Investments | $170751844 | $225693 | $— | $170977537 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(36068) | $— | $— | $(36068) |
| Total Other Financial Instruments | $(36068) | $— | $— | $(36068) |

---

486 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Internet & Direct Marketing Retail | $5756085 | $5373 | $— | $5761458 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 140067855 |  |  | 140067855 |
| Securities Lending Reinvestments Repurchase Agreements |  | 442946 |  | 442946 |
| Total Investments | $145823940 | $448319 | $— | $146272259 |
|  **Other Financial Instruments** |  |  |  |  |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $4596 | $— | $4596 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (35887) |  |  | (35887) |
| Total Other Financial Instruments | $(35887) | $4596 | $— | $(31291) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares ESG & Climate US Large Cap Core Index Fund** | **FlexShares ESG & Climate US Large Cap Core Index Fund** | **FlexShares ESG & Climate US Large Cap Core Index Fund** | **FlexShares ESG & Climate US Large Cap Core Index Fund** | **FlexShares ESG & Climate US Large Cap Core Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $21921537 | $— | $— | $21921537 |
| Short-Term Investments |  | 14967 |  | 14967 |
| Total Investments | $21921537 | $14967 | $— | $21936504 |
|  **Other Financial Instruments** |  |  |  |  |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(5618) | $— | $— | $(5618) |
| Total Other Financial Instruments | $(5618) | $— | $— | $(5618) |

---

FLEXSHARES ANNUAL REPORT 487

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares ESG & Climate Developed Markets ex-US Core Index Fund** |
|  **Investments** |  |  |  |  |
| Common Stocks\* | $17060066 | $— | $— | $17060066 |
| Total Investments | $17060066 | $— | $— | $17060066 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $3717 | $— | $3717 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (4776) |  |  | (4776) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (927) |  | (927) |
| Total Other Financial Instruments | $(4776) | $2790 | $— | $(1986) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares ESG & Climate Emerging Markets Core Index Fund** | **FlexShares ESG & Climate Emerging Markets Core Index Fund** | **FlexShares ESG & Climate Emerging Markets Core Index Fund** | **FlexShares ESG & Climate Emerging Markets Core Index Fund** | **FlexShares ESG & Climate Emerging Markets Core Index Fund** |
|  **Investments** |  |  |  |  |
| Common Stocks\* | $3824002 | $— | $— | $3824002 |
| Total Investments | $3824002 | $— | $— | $3824002 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(6812) | $— | $— | $(6812) |
| Total Other Financial Instruments | $(6812) | $— | $— | $(6812) |

---

488 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares Morningstar Global Upstream Natural Resources Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $6820447853 | $— | $— | $6820447853 |
|  Securities Lending Reinvestments  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposit |  | 18996784 |  | 18996784 |
| &nbsp;&nbsp;&nbsp;&nbsp; Commercial Paper |  | 3000000 |  | 3000000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Repurchase Agreements |  | 178125034 |  | 178125034 |
| Total Investments | $6820447853 | $200121818 | $— | $7020569671 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $211571 | $— | $— | $211571 |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | 699659 |  | 699659 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (255158) |  |  | (255158) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (988169) |  | (988169) |
| Total Other Financial Instruments | $(43587) | $(288510) | $— | $(332097) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $2481997953 | $— | $— | $2481997953 |
| Securities Lending Reinvestments Repurchase Agreements |  | 27954570 |  | 27954570 |
| Total Investments | $2481997953 | $27954570 | $— | $2509952523 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $145170 | $— | $— | $145170 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (143199) |  |  | (143199) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (48973) |  | (48973) |
| Total Other Financial Instruments | $1971 | $(48973) | $— | $(47002) |

---

FLEXSHARES ANNUAL REPORT 489

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Global Quality Real Estate Index Fund** | **FlexShares Global Quality Real Estate Index Fund** | **FlexShares Global Quality Real Estate Index Fund** | **FlexShares Global Quality Real Estate Index Fund** | **FlexShares Global Quality Real Estate Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $320007900 | $— | $— | $320007900 |
| Securities Lending Reinvestments Repurchase Agreements |  | 2527416 |  | 2527416 |
| Total Investments | $320007900 | $2527416 | $— | $322535316 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $33678 | $— | $— | $33678 |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | 42549 |  | 42549 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (85480) |  |  | (85480) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (28860) |  | (28860) |
| Total Other Financial Instruments | $(51802) | $13689 | $— | $(38113) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Real Assets Allocation Index Fund** | **FlexShares Real Assets Allocation Index Fund** | **FlexShares Real Assets Allocation Index Fund** | **FlexShares Real Assets Allocation Index Fund** | **FlexShares Real Assets Allocation Index Fund** |
|  **Investments** |  |  |  |  |
| Exchange Traded Funds | $28858364 | $— | $— | $28858364 |
| Total Investments | $28858364 | $— | $— | $28858364 |

---

490 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Quality Dividend Index Fund** | **FlexShares Quality Dividend Index Fund** | **FlexShares Quality Dividend Index Fund** | **FlexShares Quality Dividend Index Fund** | **FlexShares Quality Dividend Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $1515318768 | $— | $— | $1515318768 |
|  Securities Lending Reinvestments  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposit |  | 15997993 |  | 15997993 |
| &nbsp;&nbsp;&nbsp;&nbsp; Commercial Paper |  | 3000000 |  | 3000000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Repurchase Agreements |  | 224436675 |  | 224436675 |
| Total Investments | $1515318768 | $243434668 | $— | $1758753436 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $61448 | $— | $— | $61448 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (15018) |  |  | (15018) |
| Total Other Financial Instruments | $46430 | $— | $— | $46430 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Quality Dividend Defensive Index Fund** | **FlexShares Quality Dividend Defensive Index Fund** | **FlexShares Quality Dividend Defensive Index Fund** | **FlexShares Quality Dividend Defensive Index Fund** | **FlexShares Quality Dividend Defensive Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $340028276 | $— | $— | $340028276 |
| Securities Lending Reinvestments Repurchase Agreements |  | 16949737 |  | 16949737 |
| Total Investments | $340028276 | $16949737 | $— | $356978013 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(38754) | $— | $— | $(38754) |
| Total Other Financial Instruments | $(38754) | $— | $— | $(38754) |

---

FLEXSHARES ANNUAL REPORT 491

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Quality Dividend Dynamic Index Fund** | **FlexShares Quality Dividend Dynamic Index Fund** | **FlexShares Quality Dividend Dynamic Index Fund** | **FlexShares Quality Dividend Dynamic Index Fund** | **FlexShares Quality Dividend Dynamic Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $17688939 | $— | $— | $17688939 |
| Securities Lending Reinvestments Repurchase Agreements |  | 247981 |  | 247981 |
| Total Investments | $17688939 | $247981 | $— | $17936920 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(10149) | $— | $— | $(10149) |
| Total Other Financial Instruments | $(10149) | $— | $— | $(10149) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares International Quality Dividend Index Fund** | **FlexShares International Quality Dividend Index Fund** | **FlexShares International Quality Dividend Index Fund** | **FlexShares International Quality Dividend Index Fund** | **FlexShares International Quality Dividend Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks\* | $422801748 | $— | $— | $422801748 |
| Securities Lending Reinvestments Repurchase Agreements |  | 7868448 |  | 7868448 |
| Total Investments | $422801748 | $7868448 | $— | $430670196 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $55528 | $— | $— | $55528 |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | 26739 |  | 26739 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (380067) |  |  | (380067) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (42855) |  | (42855) |
| Total Other Financial Instruments | $(324539) | $(16116) | $— | $(340655) |

---

492 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares International Quality Dividend Defensive Index Fund** | **FlexShares International Quality Dividend Defensive Index Fund** | **FlexShares International Quality Dividend Defensive Index Fund** | **FlexShares International Quality Dividend Defensive Index Fund** | **FlexShares International Quality Dividend Defensive Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Real Estate Management & Development | $655069 | $21330 | $— | $676399 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 39127028 |  |  | 39127028 |
| Securities Lending Reinvestments Repurchase Agreements |  | 349142 |  | 349142 |
| Total Investments | $39782097 | $370472 | $— | $40152569 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $20867 | $— | $20867 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (33442) |  |  | (33442) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (2597) |  | (2597) |
| Total Other Financial Instruments | $(33442) | $18270 | $— | $(15172) |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares International Quality Dividend Dynamic Index Fund** | **FlexShares International Quality Dividend Dynamic Index Fund** | **FlexShares International Quality Dividend Dynamic Index Fund** | **FlexShares International Quality Dividend Dynamic Index Fund** | **FlexShares International Quality Dividend Dynamic Index Fund** |
|  **Investments** |  |  |  |  |
|  Common Stocks  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Real Estate Management & Development | $644965 | $72570 | $— | $717535 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other\* | 60147701 |  |  | 60147701 |
| Securities Lending Reinvestments Repurchase Agreements |  | 1013466 |  | 1013466 |
| Total Investments | $60792666 | $1086036 | $— | $61878702 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Assets |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts | $— | $12522 | $— | $12522 |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | (38514) |  |  | (38514) |
| &nbsp;&nbsp;&nbsp;&nbsp; Forward Foreign Currency Contracts |  | (2501) |  | (2501) |
| Total Other Financial Instruments | $(38514) | $10021 | $— | $(28493) |

---

FLEXSHARES ANNUAL REPORT 493

------

##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 3-Year Target Duration TIPS Index Fund** |
|  **Investments** |  |  |  |  |
| U.S. Treasury Obligations | $— | $2154633577 | $— | $2154633577 |
| Total Investments | $— | $2154633577 | $— | $2154633577 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares iBoxx 5-Year Target Duration TIPS Index Fund** |
|  **Investments** |  |  |  |  |
| U.S. Treasury Obligations | $— | $642970545 | $— | $642970545 |
| Total Investments | $— | $642970545 | $— | $642970545 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Disciplined Duration MBS Index Fund** | **FlexShares Disciplined Duration MBS Index Fund** | **FlexShares Disciplined Duration MBS Index Fund** | **FlexShares Disciplined Duration MBS Index Fund** | **FlexShares Disciplined Duration MBS Index Fund** |
|  **Investments** |  |  |  |  |
| Mortgage-Backed Securities | $— | $96171521 | $— | $96171521 |
| Total Investments | $— | $96171521 | $— | $96171521 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Credit-Scored US Corporate Bond Index Fund** | **FlexShares Credit-Scored US Corporate Bond Index Fund** | **FlexShares Credit-Scored US Corporate Bond Index Fund** | **FlexShares Credit-Scored US Corporate Bond Index Fund** | **FlexShares Credit-Scored US Corporate Bond Index Fund** |
|  **Investments** |  |  |  |  |
| Corporate Bonds\* | $— | $234820853 | $— | $234820853 |
| Total Investments | $— | $234820853 | $— | $234820853 |

---

494 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares Credit-Scored US Long Corporate Bond Index Fund** |
|  **Investments** |  |  |  |  |
| Corporate Bonds\* | $— | $34694439 | $— | $34694439 |
| Total Investments | $— | $34694439 | $— | $34694439 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares High Yield Value-Scored Bond Index Fund** | **FlexShares High Yield Value-Scored Bond Index Fund** | **FlexShares High Yield Value-Scored Bond Index Fund** | **FlexShares High Yield Value-Scored Bond Index Fund** | **FlexShares High Yield Value-Scored Bond Index Fund** |
|  **Investments** |  |  |  |  |
| Corporate Bonds\* | $— | $861008645 | $— | $861008645 |
| Total Investments | $— | $861008645 | $— | $861008645 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares ESG & Climate High Yield Corporate Core Index Fund** |
|  **Investments** |  |  |  |  |
| Corporate Bonds\* | $— | $19887403 | $— | $19887403 |
| Total Investments | $— | $19887403 | $— | $19887403 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares ESG & Climate Investment Grade Corporate Core Index Fund** |
|  **Investments** |  |  |  |  |
| Corporate Bonds\* | $— | $21969323 | $— | $21969323 |
| Total Investments | $— | $21969323 | $— | $21969323 |

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FLEXSHARES ANNUAL REPORT 495

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Ready Access Variable Income Fund** | **FlexShares Ready Access Variable Income Fund** | **FlexShares Ready Access Variable Income Fund** | **FlexShares Ready Access Variable Income Fund** | **FlexShares Ready Access Variable Income Fund** |
|  **Investments** |  |  |  |  |
|  Corporate Bonds\* | $— | $647247156 | $— | $647247156 |
|  Asset-Backed Securities |  | 23840594 |  | 23840594 |
|  Municipal Bonds |  | 6174301 |  | 6174301 |
|  U.S. Government Agency Securities |  | 1799324 |  | 1799324 |
|  Foreign Government Securities |  | 795096 |  | 795096 |
| Short-Term Investments |  | 178798966 |  | 178798966 |
| Total Investments | $— | $858655437 | $— | $858655437 |
|  | Level 1 — Quoted<br>Prices | Level 2 — Other<br>Significant<br>Observable<br>Inputs | Level 3 —<br>Significant<br>Unobservable<br>Inputs | Total |
| **FlexShares Core Select Bond Fund** | **FlexShares Core Select Bond Fund** | **FlexShares Core Select Bond Fund** | **FlexShares Core Select Bond Fund** | **FlexShares Core Select Bond Fund** |
|  **Investments** |  |  |  |  |
|  Exchange Traded Funds | $156562365 | $— | $— | $156562365 |
|  Securities Lending Reinvestments Repurchase Agreements |  | 55525084 |  | 55525084 |
| Short-Term Investments |  | 993846 |  | 993846 |
| Total Investments | $156562365 | $56518930 | $— | $213081295 |
|  **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** | **Other Financial Instruments** |
|  Liabilities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Futures Contracts | $(3960) | $— | $— | $(3960) |
| Total Other Financial Instruments | $(3960) | $— | $— | $(3960) |

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*\** *See Schedules of Investments for segregation by industry type.* 

496 FLEXSHARES ANNUAL REPORT

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**Foreign Securities** 

The FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund (through its investment in its Underlying Funds), FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund and the FlexShares ESG & Climate Emerging Markets Core Index Fund invest in publicly-traded equity securities of issuers in countries other than the United States of America ("U.S."). Such investments include direct investments in non-U.S. dollar denominated securities traded outside the U.S. The Funds' investments in foreign securities also may be in the form of ADRs and Global Depositary Receipts ("GDRs") (collectively, "Depositary Receipts") based on securities in their Underlying Indexes. ADRs are receipts that are traded in the United States evidencing ownership of the underlying foreign securities and are denominated in U.S. dollars. GDRs are receipts issued by a non-U.S. financial institution evidencing ownership of underlying foreign or U.S. securities and usually are denominated in foreign currencies. GDRs may not be denominated in the same currency as the securities they represent. Generally, GDRs are designed for use in foreign securities markets.

In addition to investment risks associated with the underlying issuer, ADRs and GDRs expose a Fund to risk associated with non-uniform terms that apply to ADR and GDR programs, credit exposure to the depository bank and to the sponsors and other parties with whom the depository bank establishes the programs, currency and liquidity risk. ADRs and GDRs are generally subject to the same risks as the foreign securities that they evidence or into which they may be converted.

To the extent a Fund invests in ADRs, such ADRs will be listed

on a national securities exchange. To the extent a Fund invests in GDRs, such GDRs will be listed on a foreign exchange. A Fund will not invest in any unlisted Depositary Receipt, any Depositary Receipt that NTI deems to be illiquid or any Depositary Receipt for which market quotations are not readily available. Generally, all Depositary Receipts must be sponsored.

The FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund may invest in U.S. dollar denominated bonds of non-U.S. corporations to the extent such bonds are included in each Fund's Underlying Index. The FlexShares Core Select Bond Fund may invest in U.S. dollar denominated bonds of non-U.S. corporations, either directly or indirectly through Underlying Funds, to achieve its investment objective.

The FlexShares Ready Access Variable Income Fund may invest, without limitation, in fixed-income securities and instruments of foreign issuers in developed and emerging markets, including debt securities of foreign governments.

Investing in foreign securities, including Depositary Receipts, may result in a Fund experiencing more rapid and extreme changes in value than a fund that invests exclusively in U.S. securities, due to less liquid markets, and adverse economic, political, diplomatic, financial, and regulatory factors. Foreign governments also may impose taxes and limits on investment and repatriation. Any of these events could cause the value of a Fund's foreign investment to decline. To the extent that a Fund's assets are significantly invested in a single country or geographic region, a Fund will be subject to the risks associated with that particular country or region.

The FlexShares Emerging Markets Quality Low Volatility Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, and FlexShares ESG & Climate Emerging Markets Core Index Fund will invest primarily in emerging market countries. In addition, the FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation

FLEXSHARES ANNUAL REPORT 497

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Index Fund (through its investment in its Underlying Funds), FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and the FlexShares International Quality Dividend Dynamic Index Fund may invest its assets in emerging market countries. The FlexShares Ready Access Variable Income Fund may invest up to 20% of its total assets in fixed-income securities and instruments of issuers in emerging markets. The markets of emerging market countries are less developed and less liquid, subject to greater price volatility and generally subject to increased economic, political, regulatory and other uncertainties than more developed foreign markets. The risks of foreign investment are increased when the issuer is located in a country with an emerging economy or securities market.

**Inflation-Indexed Securities** 

The FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund invest primarily in U.S. Treasury Inflation-Protected Securities ("TIPS").

TIPS have varying maturities and pay interest on a semiannual basis equal to a fixed percentage of the inflation-adjusted principal amount. If the periodic adjustment rate measuring inflation falls, the principal value of TIPS will be adjusted downward, and consequently the interest payable on these securities (calculated with respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is guaranteed in the case of TIPS, even during a period of deflation.

The value of TIPS is expected to change in response to changes in real interest rates. Real interest rates in turn are tied to the relationship between nominal interest rates and the rate of inflation. Therefore, if the rate of inflation rises at a faster rate than nominal interest rates, real interest rates might decline, leading to an increase in value of TIPS. In contrast, if nominal interest rates increase at a faster rate than inflation, real interest rates might rise, leading to a decrease in value of TIPS. Any increase in the principal amount of TIPS will be considered taxable ordinary income, even though investors do not receive their principal until maturity.

While these securities are expected to be protected from long-term inflationary trends, short-term increases in inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation, investors in these securities may not be protected to the extent that the increase is not reflected in the TIPS' inflation measure.

The periodic adjustment of TIPS is tied to the Consumer Price Index for Urban Consumers ("CPI-U"), which is calculated monthly by the U.S. Bureau of Labor Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing, food, transportation and energy. There can be no assurance that the CPI-U will accurately measure the real rate of inflation in the prices of goods and services.

**Mortgage-Backed Pass-Through Securities** 

The FlexShares Disciplined Duration MBS Index Fund invests primarily in U.S. agency mortgage-backed pass-through securities ("MBS"), a category of pass-through securities backed by pools of mortgages and issued by one of the following U.S. government agencies: the Federal National Mortgage Association (FNMA or Fannie Mae), the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) or the Government National Mortgage Association (GNMA or Ginnie Mae) (each a "US Agency"). Under normal circumstances, the Fund will invest at least 80% of its total assets in the securities of its Underlying Index and in "to-be announced transactions" ("TBA transactions") that represent securities in its Underlying Index. In a TBA transaction, the buyer and seller agree upon general trade parameters such as agency, coupon rate, settlement date, par amount and price. The actual pools delivered generally are determined two days prior to settlement.

Pending settlement of such TBA contracts, the FlexShares Disciplined Duration MBS Index Fund will invest in liquid, short-term instruments. The FlexShares Core Select Bond Fund may also invest either directly or through its Underlying Funds in MBS, including TBA transactions.

498 FLEXSHARES ANNUAL REPORT

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**Mortgage Dollar Rolls** 

The FlexShares Disciplined Duration MBS Index Fund, the FlexShares Ready Access Variable Income Fund and the FlexShares Core Select Bond Fund (directly or through its Underlying Funds) may enter into mortgage dollar roll transactions. A mortgage dollar roll involves the sale by the Fund of securities for delivery in the future (generally within 30 days). The Fund simultaneously contracts with the same counterparty to repurchase substantially similar (same type, coupon and maturity) but not identical securities on a specified future date. During the roll period, the Fund will not be entitled to accrue interest and receive principal payments on the securities sold. However, the Fund benefits to the extent of any difference between (a) the price received for the securities sold and (b) the lower forward price for the future purchase and/or fee income plus the interest earned on the cash proceeds of the securities sold. Successful use of mortgage dollar rolls depends upon the Investment Adviser's ability to predict correctly interest rates and mortgage prepayments. The use of this technique may diminish the investment performance of the Fund compared with what such performance would have been without the use of mortgage dollar rolls.

For financial reporting and tax purposes, a Fund treats mortgage dollar rolls as two separate transactions: one involving the purchase of a security and a separate transaction involving a sale. The Fund currently does not intend to enter into mortgage dollar rolls that are accounted for as financing and does not treat them as borrowings.

**Repurchase Agreements** 

To the extent consistent with its investment policies, each Fund may enter into repurchase agreements under which it purchases securities (collateral) for cash from a seller and agrees to resell those securities to the same seller within a specified time at a specified price. During the term of a repurchase agreement, the market value of the underlying collateral, including accrued interest, is required to equal or exceed the market value of the repurchase agreement. The underlying collateral for tri-party repurchase agreements is held in accounts at JPMorgan Chase, the Fund's custodian, and is not reflected in the assets of the Funds, at the Bank of

New York or JPMorgan Chase which, in turn, holds securities through the book-entry system at the Federal Reserve Bank of New York. The Fund is subject to credit risk on repurchase agreements to the extent that the counterparty fails to perform under the agreement and the value of the collateral received falls below the agreed repurchase price.

The Northern Trust Company, the parent of NTI, currently is a party to various Master Repurchase Agreements with a number of different counterparties, and acts as agent on behalf of various disclosed principals, including the Funds and various other accounts managed by NTI, in entering into repurchase agreements under the Master Repurchase Agreements. NTI administers and manages these repurchase agreements in accordance with and as part of its duties under its investment advisory agreement with the Funds and does not collect any additional fees from the Funds for such services. As of October 31, 2022, none of the Funds presented in these financial statements had repurchase agreements outstanding except as discussed below.

As of October 31, 2022, the FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Core Select Bond Fund invested cash collateral for loans of portfolio securities in repurchase agreements, as reflected in the respective Schedule of Investments under the caption "Securities Lending Reinvestments."

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**Securities Lending** 

Each Fund may lend securities to banks, brokers and dealers or other qualified institutions. In exchange, the Fund is required to receive minimum initial collateral value as follows:

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| | |
|:---|:---|
| Type of Loan | Minimum Initial<br>Collateral Requirement |
| U.S. dollar denominated securities secured by U.S. dollar denominated government securities or cash collateral | 102% |
| U.S. dollar denominated securities secured by non-U.S. dollar denominated government securities or cash collateral | 105% |
| Non-U.S. dollar denominated securities secured by government securities or cash collateral in the same denomination as the lent securities | 102% |
| Non-U.S. dollar denominated securities secured by government securities or cash collateral in the different denomination from the lent securities | 105% |
| U.S. dollar and Non-U.S. dollar denominated securities secured by equity securities collateral | 105% |

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The collateral is maintained thereafter, at a value equal to at least 100% of the value of the securities loaned. The collateral amount is valued at the beginning of each business day and is compared to the market value of the loaned securities from the prior business day to determine if additional collateral is required. If additional collateral is required, a request is sent to the borrower.

Securities lending may represent no more than one-third of the value of a Fund's total assets (including the loan collateral). JPMorgan Chase Bank, N.A. (the "Securities Lending Agent") serves as the securities lending agent for the securities lending program of a Fund.

Collateral for loans of portfolio securities made by a Fund may consist of cash, cash equivalents, securities issued or guaranteed by the U.S. government or foreign governments or its agencies (or any combination thereof). Any cash collateral received by the Fund in connection with these loans

may be invested in a variety of short-term investments, either directly or indirectly through money market portfolios. The market value of securities on loan and the value of investments made with cash collateral received are disclosed in the Schedules of Investments. Securities lending income includes income from the securities lending program recorded when earned from the Securities Lending Agent and any fees charged to borrowers less expenses associated with the loan. The net amount is reflected in the Statement of Operations under "Securities lending income (net of fees)." The market value of the loaned securities is determined at the close of each business day of the Fund and any additional required collateral is delivered to the Fund, or excess collateral returned by the Fund, on the next business day.

When a Fund lends its securities, it will continue to receive payments equal to the dividends and interest paid on the securities loaned and simultaneously may earn interest on the investment of the cash collateral.

A Fund will have the right to terminate a loan at any time and recall the loaned securities within the normal and customary settlement time for securities transactions. A Fund does not have the right to vote securities on loan, but can terminate the loan and regain the right to vote if a material event affecting the securities occurred. A borrower might become insolvent or refuse to honor its obligation to return the securities. In the event of a default by a borrower with respect to any loan, the Securities Lending Agent will exercise any and all remedies provided under the applicable borrower agreement. These remedies include purchasing replacement securities for the Fund by applying the collateral held from the defaulting borrower against the purchase cost of the replacement securities. If the proceeds from the collateral are less than the purchase cost of the replacement securities, the Securities Lending Agent is responsible for such shortfall, subject to certain limitations that are set forth in detail in the Securities Lending Agency Agreement. In this event, a Fund could experience delays in recovering its securities and possibly may incur a capital loss. Each Fund will be responsible for any loss that might result from its investment of the cash collateral it receives from a borrower.

500 FLEXSHARES ANNUAL REPORT

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In accordance with guidance presented in FASB Accounting Standard Update ("ASU") 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures, liabilities under the outstanding securities lending transactions as of October 31, 2022, which were comprised of cash, were as follows:

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| | |
|:---|:---|
| Fund |  |
| FlexShares<sup>®</sup> US Quality Low Volatility Index Fund | $1156911 |
| FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund | 481336 |
| FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund | 203821768 |
| FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund | 7591069 |
| FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund | 3027697 |
| FlexShares<sup>®</sup> US Quality Large Cap Index Fund | 264465 |
| FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund | 225693 |
| FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund | 442946 |
| FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund | 200125034 |
| FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 27954570 |
| FlexShares<sup>®</sup> Global Quality Real Estate Index Fund | 2527416 |
| FlexShares<sup>®</sup> Quality Dividend Index Fund | 243436675 |
| FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund | 16949737 |
| FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund | 247981 |
| FlexShares<sup>®</sup> International Quality Dividend Index Fund | 7868448 |
| FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund | 349142 |
| FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund | 1013466 |
| FlexShares<sup>®</sup> Core Select Bond Fund | 55525084 |

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At October 31, 2022, the Securities Lending Agency Agreement does not permit the Funds to enforce a netting arrangement.

The cash collateral received from securities loaned as disclosed in the Statements of Assets and Liabilities is collateralized by securities on loan as disclosed within the Schedules of Investments and such borrowings have maturities that are overnight and continuous.

Securities lending agreements may be subject to regulation as qualified financial contracts ("QFCs"). Regulations adopted by federal banking regulators under the Dodd-Frank Act, which took effect in 2019, require that certain QFCs with counterparties that are part of U.S. or foreign global systemically important banking organizations be amended to include contractual restrictions on close-out and cross-default rights. If a covered counterparty of a Fund or certain of the covered counterparty's affiliates were to become subject to certain insolvency proceedings, the Fund may be temporarily unable to exercise certain default rights, and the QFC may be transferred to another entity. These requirements may impact a Fund's credit and counterparty risks. The remaining maturities of the securities lending transactions are considered overnight and continuous.

**Derivative Contracts** 

*Futures Contracts* 

All of the Index Funds may invest in futures contracts to help track the price and yield performance of their Underlying Indexes. At the time a Fund enters into a futures contract, it is generally required to make a margin deposit with the custodian of a specified amount of liquid assets. Subsequent payments to be made or received by the Funds equal to the change in contract value are recorded as variation margin payable or receivable and offset in unrealized gains or losses. Futures are marked to market each day with the change in value reflected in the unrealized gains or losses. A Fund recognizes a realized gain or loss when a contract is closed or expires. The Statements of Operations reflect unrealized gains or losses on open futures contracts, as "Net change in unrealized appreciation (depreciation) on futures contracts", and any realized gains (losses) on closed futures contracts as "Net realized gain (loss) from Expiration or closing of futures contracts".

FLEXSHARES ANNUAL REPORT 501

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The FlexShares Core Select Bond Fund may take long or short positions in futures to manage the Fund's exposure to interest rate risk. The Fund seeks to mitigate the potential impact of interest rates on the performance of bonds by entering into short positions in U.S. Treasury futures or transactions in interest rate swaps. The Fund's short positions in U.S. Treasury futures and interest rate swaps are not intended to mitigate credit spread risk or other factors influencing the price of bonds, which may have a greater impact than interest rates. In addition, when interest rates fall, long-only bond investments will perform better than the Fund's investments. As of October 31, 2022, the FlexShares Core Select Bond Fund did not hold swaps.

As of October 31, 2022, the FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Core Select Bond Fund had open futures contracts.

The use of futures contracts involves, to varying degrees, elements of market and counterparty risk, which may exceed the amounts recognized in the Statements of Assets and Liabilities. Futures contracts present the following risks: imperfect correlation between the change in market value of

a Fund's securities and the price of futures contracts; the possible inability to close a futures contract when desired; losses due to unanticipated market movements, which potentially are unlimited; and the possible inability of NTI to correctly predict the direction of securities prices, interest rates, currency exchange rates and other economic factors. Futures markets are highly volatile and the use of futures may increase the volatility of a Fund's NAV. As a result of the low margin deposits normally required in futures trading, a relatively small price movement in a futures contract may result in substantial losses to a Fund. Futures contracts may be illiquid, and exchanges may limit fluctuations in futures contract prices during a single day. Foreign exchanges or boards of trade generally do not offer the same protection as U.S. exchanges.

*Foreign Currency Translations* 

Values of investments denominated in foreign currencies are converted into U.S. dollars using the prevailing market rates on the date of valuation as quoted by one or more banks or dealers that make a two-way market in such currencies (or a data service provider based on quotations received from such banks or dealers). Any use of a rate different from the rates used by an Underlying Index's index provider may affect the corresponding Index Fund's ability to track its Underlying Index. The cost of purchases and proceeds from sales of investments, interest and dividend income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. "Net realized gain (loss) on foreign currency transactions" on the Statements of Operations include the effect of changes in exchange rates between trade date and settlement date on investment security transactions, foreign currency transactions and interest and dividends received, and the portion of foreign currency gains and losses related to fluctuation in exchange rates between the initial purchase trade date and subsequent sale trade date is included in "Net realized gain (loss) on investment in securities" on the Statements of Operations. Unrealized gains and losses on assets and liabilities, other than investments in securities, which result from changes in foreign currency exchange rates have been included in "Net change in unrealized appreciation (depreciation) on translation of other assets and liabilities denominated in foreign currencies" on the Statements of Operations.

502 FLEXSHARES ANNUAL REPORT

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*Forward Foreign Currency Exchange Contracts* 

The FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and the FlexShares Ready Access Variable Income Fund may enter into forward foreign currency exchange contracts to facilitate local settlements or to protect against currency exposure in connection with its distributions to shareholders. The FlexShares Ready Access Variable Income Fund also may engage in forward foreign currency transactions for hedging purposes in order to protect against uncertainty in the level of future foreign currency exchange rates. The Funds, however, do not expect to engage in currency transactions for speculative purposes (e.g., for potential income or capital gain). All forward foreign currency exchange contracts held are "marked-to-market" daily at the applicable exchange rates and any resulting unrealized gains or losses are recorded. The Funds record realized gains or losses at the time the forward foreign currency exchange contract is offset by entering into a closing transaction or extinguished by delivery of the currency. The difference between the future foreign currency exchange rates at the date of entry into the contract and the rates at the reporting date are included in "Net change in unrealized appreciation (depreciation) on forward foreign currency contracts" in the Statements of Operations. Non-deliverable forward foreign currency exchange contracts are settled with the counterparty in U.S. Dollars without the delivery of foreign currency.

There are several risks associated with these contracts. One risk is the potential inability of counterparties to meet the terms of their contracts, and unanticipated movements in

the value of a foreign currency relative to the U.S. dollar. The contractual amounts of forward foreign currency exchange contracts do not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered. The Statements of Operations reflect (i) realized gains or losses, if any, in "Net realized gain (loss) from settlement of forward foreign currency contracts" and (ii) unrealized gains or losses in "Net change in unrealized appreciation (depreciation) on forward foreign currency contracts". Forward foreign currency exchange contracts are privately negotiated transactions and can have substantial price volatility. As a result, they offer less protection against default by the other party than is available for instruments traded on an exchange. The institutions that deal in forward foreign currency exchange contracts are not required to continue to make markets in the currencies they trade, and these markets can experience periods of illiquidity.

As of October 31, 2022, the FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Morningstar<sup>®</sup> Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar<sup>®</sup> Emerging Markets Factor Tilt Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares Morningstar<sup>®</sup> Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and the FlexShares International Quality Dividend Dynamic Index Fund had open forward foreign currency contracts.

**Offsetting of Financial Assets and Derivative Assets** 

The Funds' accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International Swaps and Derivatives Association (ISDA) Master Agreement or similar agreement does not result in an offset of reported amounts of financial assets and financial liabilities

in the Statements of Assets and Liabilities across transactions

FLEXSHARES ANNUAL REPORT 503

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Notes to the Financial Statements (cont.)

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between the Fund and the applicable counterparty. In the event of a default, the agreement provides the right for the non-defaulting party to liquidate the collateral and calculate the net exposure to the defaulting party or request additional collateral. The Funds' right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which a specific master netting agreement counterparty is subject.

For financial reporting purposes, the Trust can offset financial assets and financial liabilities of the FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar<sup>®</sup> Developed Markets ex-US

Factor Tilt Index Fund, FlexShares Morningstar<sup>®</sup> Emerging Markets Factor Tilt Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares ESG & Climate Developed Market ex-US Core Index Fund, FlexShares Morningstar<sup>®</sup> Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund and the FlexShares International Quality Dividend Dynamic Index Fund that are subject to master netting arrangements or similar agreements in the Statements of Assets and Liabilities. The following table presents the gross and net amounts of these assets and liabilities:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | |
|  |  | Gross Amounts of<br>Assets presented in<br>Statements of Assets<br>and Liabilities | Financial<br>Instruments | Cash Collateral<br>Received | Net Amount |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | Foreign Currency Contracts — Bank of New York | $114 | $— | $— | $114 |
|  | Foreign Currency Contracts — BNP Paribas SA | 1274 |  |  | 1274 |
|  | Foreign Currency Contracts — Citibank NA | 9355 | (54) |  | 9301 |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 2908 | (217) |  | 2691 |
|  | Foreign Currency Contracts — Morgan Stanley | 1175 | (283) |  | 892 |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | 2102 | (1428) |  | 674 |
|  | Total | $16928 | $(1982) | $— | $14946 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | Foreign Currency Contracts — Bank of Montreal | $21128 | $— | $— | $21128 |
|  | Foreign Currency Contracts — Bank of New York | 10447 | (10447) |  |  |
|  | Foreign Currency Contracts — Citibank NA | 21978 |  |  | 21978 |
|  | Foreign Currency Contracts — Morgan Stanley | 343 | (343) |  |  |
|  | Total | $53896 | $(10790) | $— | $43106 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | Foreign Currency Contracts — Citibank NA | $35673 | $(23349) | $— | $12324 |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | 947 | (947) |  |  |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 801 |  |  | 801 |
|  | Total | $37421 | $(24296) | $— | $13125 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | Foreign Currency Contracts — Bank of New York | $4596 |  | $— | $4596 |
|  | Total | $4596 |  | $— | $4596 |

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504 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | |
|  |  | Gross Amounts of<br>Assets presented in<br>Statements of Assets<br>and Liabilities | Financial<br>Instruments | Cash Collateral<br>Received | Net Amount |
| FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund | Foreign Currency Contracts — Bank of New York | $147 | $(147) | $— | $— |
|  | Foreign Currency Contracts — BNP Paribas SA | 58 |  |  | 58 |
|  | Foreign Currency Contracts — Citibank NA | 1560 | (404) |  | 1156 |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | 7 |  |  | 7 |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 591 |  |  | 591 |
|  | Foreign Currency Contracts — Morgan Stanley | 1354 | (23) |  | 1331 |
|  | Total | $3717 | $(574) | $— | $3143 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | Foreign Currency Contracts — Bank of New York | $69375 | $— | $— | $69375 |
|  | Foreign Currency Contracts — Citibank NA | 428701 | (300768) |  | 127933 |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | 10494 |  |  | 10494 |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 25561 | (25561) |  |  |
|  | Foreign Currency Contracts — Morgan Stanley | 6574 | (6574) |  |  |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | 158954 | (158954) |  |  |
|  | Total | $699659 | $(491857) | $— | $207802 |
| FlexShares Global Quality Real Estate Index Fund | Foreign Currency Contracts — Bank of New York | $7051 | $— | $— | $7051 |
|  | Foreign Currency Contracts — BNP Paribas SA | 751 |  |  | 751 |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 213 | (213) |  |  |
|  | Foreign Currency Contracts — Morgan Stanley | 34534 | (1682) |  | 32852 |
|  | Total | $42549 | $(1895) | $— | $40654 |
| FlexShares International Quality Dividend Index Fund | Foreign Currency Contracts — Bank of New York | $5399 | $— | $— | $5399 |
|  | Foreign Currency Contracts — Citibank NA | 17089 | (17089) |  |  |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 4251 |  |  | 4251 |
|  | Total | $26739 | $(17089) | $— | $9650 |
| FlexShares International Quality Dividend Defensive Index Fund | Foreign Currency Contracts — Bank of New York | $10810 | $(863) | $— | $9947 |
|  | Foreign Currency Contracts — Citibank NA | 2746 | (332) |  | 2414 |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | 1278 |  |  | 1278 |
|  | Foreign Currency Contracts — Morgan Stanley | 6033 | (57) |  | 5976 |
|  | Total | $20867 | $(1252) | $— | $19615 |
| FlexShares International Quality Dividend Dynamic Index Fund | Foreign Currency Contracts — Bank of New York | $7148 | $(456) | $— | $6692 |
|  | Foreign Currency Contracts — Citibank NA | 4375 |  |  | 4375 |
|  | Foreign Currency Contracts — Morgan Stanley | 999 |  |  | 999 |
|  | Total | $12522 | $(456) | $— | $12066 |

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FLEXSHARES ANNUAL REPORT 505

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | |
|  |  | Gross Amounts of<br>Liabilities presented in<br>Statements of Assets<br>and Liabilities | Financial<br>Instruments | Cash Collateral<br>Received | Net Amount |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | Foreign Currency Contracts — Citibank NA | $(54) | $54 | $— | $— |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | (217) | 217 |  |  |
|  | Foreign Currency Contracts — Morgan Stanley | (283) | 283 |  |  |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (1428) | 1428 |  |  |
|  | Total | $(1982) | $1982 | $— | $— |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | Foreign Currency Contracts — Bank of New York | $(27909) | $10447 | $— | $(17462) |
|  | Foreign Currency Contracts — BNP Paribas SA | (2464) |  |  | (2464) |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | (46) |  |  | (46) |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | (488) |  |  | (488) |
|  | Foreign Currency Contracts — Morgan Stanley | (56704) | 343 |  | (56361) |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (17775) |  |  | (17775) |
|  | Total | $(105386) | $10790 | $— | $(94596) |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | Foreign Currency Contracts — Bank of Montreal | $(435) | $— | $— | $(435) |
|  | Foreign Currency Contracts — BNP Paribas SA | (1964) |  |  | (1964) |
|  | Foreign Currency Contracts — Citibank NA | (23349) | 23349 |  |  |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | (7161) | 947 |  | (6214) |
|  | Total | $(32909) | $24296 | $— | $(8613) |
| FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund | Foreign Currency Contracts — Bank of Montreal | $(209) | $— | $— | $(209) |
|  | Foreign Currency Contracts — Bank of New York | (255) | 147 |  | (108) |
|  | Foreign Currency Contracts — Citibank NA | (404) | 404 |  |  |
|  | Foreign Currency Contracts — Morgan Stanley | (23) | 23 |  |  |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (36) |  |  | (36) |
|  | Total | $(927) | $574 | $— | $(353) |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | Foreign Currency Contracts — Citibank NA | $(300768) | $300768 | $— | $— |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | (144684) | 25561 |  | (119123) |
|  | Foreign Currency Contracts — Morgan Stanley | (348539) | 6574 |  | (341965) |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (194178) | 158954 |  | (35224) |
|  | Total | $(988169) | $491857 | $— | $(496312) |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | Foreign Currency Contracts — Morgan Stanley | $(10989) | $— | $— | $(10989) |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (37984) |  |  | (37984) |
|  | Total | $(48973) | $— | $— | $(48973) |

---

506 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | Gross Amounts Not Offset in the<br>Statement of Assets and Liabilities | |
|  |  | Gross Amounts of<br>Liabilities presented in<br>Statements of Assets<br>and Liabilities | Financial<br>Instruments | Cash Collateral<br>Received | Net Amount |
| FlexShares Global Quality Real Estate Index Fund | Foreign Currency Contracts — Bank of Montreal | $(612) | $— | $— | $(612) |
|  | Foreign Currency Contracts — Citibank NA | (1248) |  |  | (1248) |
|  | Foreign Currency Contracts — Goldman Sachs & Co. | (160) |  |  | (160) |
|  | Foreign Currency Contracts — JPMorgan Chase Bank | (20260) | 213 |  | (20047) |
|  | Foreign Currency Contracts — Morgan Stanley | (1682) | 1682 |  |  |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (4898) |  |  | (4898) |
|  | Total | $(28860) | $1895 | $— | $(26965) |
| FlexShares International Quality Dividend Index Fund | Foreign Currency Contracts — Citibank NA | $(42855) | $17089 | $— | $(25766) |
|  | Total | $(42855) | $17089 | $— | $(25766) |
| FlexShares International Quality Dividend Defensive Index Fund | Foreign Currency Contracts — Bank of New York | $(863) | $863 | $— | $— |
|  | Foreign Currency Contracts — Citibank NA | (332) | 332 |  |  |
|  | Foreign Currency Contracts — Morgan Stanley | (57) | 57 |  |  |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (1345) |  |  | (1345) |
|  | Total | $(2597) | $1252 | $— | $(1345) |
| FlexShares International Quality Dividend Dynamic Index Fund | Foreign Currency Contracts — Bank of New York | $(456) | $456 | $— | $— |
|  | Foreign Currency Contracts — Toronto-Dominion Bank (The) | (2045) |  |  | (2045) |
|  | Total | $(2501) | $456 | $— | $(2045) |

---

The following tables indicate the location of derivative-related items on the Statements of Assets and Liabilities as well as the effect of derivative instruments on the Statements of Operations during the reporting period.

**Fair Value of Derivative Instruments as of October 31, 2022** 

---

| | | | |
|:---|:---|:---|:---|
| Derivatives by risk type | Statements of Assets<br> and Liabilities Location | Fund | Value |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares US Quality Low Volatility Index Fund | $7830 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares US Quality Low Volatility Index Fund | (1033) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | (42523) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 16928 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | (1982) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Emerging Markets Quality Low Volatility Index Fund | (7669) |

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FLEXSHARES ANNUAL REPORT 507

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | | |
|:---|:---|:---|:---|
| Derivatives by risk type | Statements of Assets<br> and Liabilities Location | Fund | Value |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares Morningstar US Market Factor Tilt Index Fund | $285430 |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 125896 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | (63678) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 53896 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | (105386) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | (177121) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 37421 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | (32909) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares US Quality Large Cap Index Fund | 10322 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares US Quality Large Cap Index Fund | (58578) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | (36068) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | (35887) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 4596 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares ESG & Climate US Large Cap Core Index Fund | (5618) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | (4776) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 3717 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | (927) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares ESG & Climate Emerging Markets Core Index Fund | (6812) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares Morningstar Global Upstream Natural Resources Index Fund | 211571 |

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508 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | | |
|:---|:---|:---|:---|
| Derivatives by risk type | Statements of Assets<br> and Liabilities Location | Fund | Value |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Morningstar Global Upstream Natural Resources Index Fund | $(255158) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares Morningstar Global Upstream Natural Resources Index Fund | 699659 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares Morningstar Global Upstream Natural Resources Index Fund | (988169) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 145170 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | (143199) |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | (48973) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares Global Quality Real Estate Index Fund | 33678 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Global Quality Real Estate Index Fund | (85480) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares Global Quality Real Estate Index Fund | 42549 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares Global Quality Real Estate Index Fund | (28860) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares Quality Dividend Index Fund | 61448 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Quality Dividend Index Fund | (15018) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Quality Dividend Defensive Index Fund | (38754) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Quality Dividend Dynamic Index Fund | (10149) |
| Equity Index Futures Contracts | Assets — Unrealized appreciation on futures contracts\* | FlexShares International Quality Dividend Index Fund | 55528 |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares International Quality Dividend Index Fund | (380067) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares International Quality Dividend Index Fund | 26739 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares International Quality Dividend Index Fund | (42855) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares International Quality Dividend Defensive Index Fund | (33442) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares International Quality Dividend Defensive Index Fund | 20867 |

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FLEXSHARES ANNUAL REPORT 509

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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| | | | |
|:---|:---|:---|:---|
| Derivatives by risk type | Statements of Assets<br> and Liabilities Location | Fund | Value |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares International Quality Dividend Defensive Index Fund | $(2597) |
| Equity Index Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares International Quality Dividend Dynamic Index Fund | (38514) |
| Foreign Currency Contracts | Assets — Unrealized appreciation on forward foreign currency contracts | FlexShares International Quality Dividend Dynamic Index Fund | 12522 |
| Foreign Currency Contracts | Liabilities — Unrealized depreciation on forward foreign currency contracts | FlexShares International Quality Dividend Dynamic Index Fund | (2501) |
| Interest Rate Futures Contracts | Liabilities — Unrealized depreciation on futures contracts\* | FlexShares Core Select Bond Fund | (3960) |

---

*\** *Includes cumulative appreciation/depreciation on futures contracts as reported in the Schedule of Investments. Current day's variation margin is reported within the Statement of Assets and Liabilities for futures contracts.* 

**The Effect of Derivative Instruments on the Statements of Operations for the Year Ended October 31, 2022** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| Derivatives by<br>risk type | Location of Gain or (Loss) on<br> Derivatives on the Statements of<br>Operations | Fund | Realized<br> Gain or<br> (Loss) on<br> Derivatives | Change in Unrealized<br> Appreciation or<br> (Depreciation) on<br> Derivatives |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in <br>unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares US Quality Low Volatility Index Fund | $(283104) | $(1744) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in <br>unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | (294793) | (47271) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation<br>(depreciation) on Forward foreign currency contracts | FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 114349 | 9729 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on <br>Futures contracts | FlexShares Emerging Markets Quality Low Volatility Index Fund | (48717) | (6048) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation<br>(depreciation) on Forward foreign currency contracts | FlexShares Emerging Markets Quality Low Volatility Index Fund | 1424 | (2) |

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510 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
| Derivatives by<br>risk type | Location of Gain or (Loss) on<br> Derivatives on the Statements of<br>Operations | Fund | Realized<br> Gain or<br> (Loss) on<br> Derivatives | Change in Unrealized<br> Appreciation or<br> (Depreciation) on<br> Derivatives |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on <br>Futures contracts | FlexShares Morningstar US Market Factor Tilt Index Fund | $(2142809) | $(170946) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | (755268) | (55871) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | (745024) | 71255 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | (904011) | (127750) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 160911 | (4724) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares US Quality Large Cap Index Fund | (273891) | (95079) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | (95274) | (75559) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | (387711) | (91583) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation <br>(depreciation) on Forward foreign currency contracts | FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 156936 | (6243) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares ESG & Climate US Large Cap Core Index Fund | (19215) | (6858) |

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FLEXSHARES ANNUAL REPORT 511

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

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| | | | | |
|:---|:---|:---|:---|:---|
| Derivatives by<br>risk type | Location of Gain or (Loss) on<br> Derivatives on the Statements of<br>Operations | Fund | Realized<br> Gain or<br> (Loss) on<br> Derivatives | Change in Unrealized<br> Appreciation or<br> (Depreciation) on<br> Derivatives |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | $(43003) | $(4776) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 2773 | 4137 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in <br>unrealized appreciation (depreciation) on Futures contracts | FlexShares ESG & Climate Emerging Markets Core Index Fund | (4688) | (6812) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares Morningstar Global Upstream Natural Resources Index Fund | (8445121) | (875882) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation <br>(depreciation) on Forward foreign currency contracts | FlexShares Morningstar Global Upstream Natural Resources Index Fund | (1217160) | (682867) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | (1241022) | (434981) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | (793098) | 201860 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares Global Quality Real Estate Index Fund | (1219139) | (174520) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares Global Quality Real Estate Index Fund | 34177 | 19617 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares Quality Dividend Index Fund | (2464197) | (284371) |

---

512 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
| Derivatives by<br>risk type | Location of Gain or (Loss) on<br> Derivatives on the Statements of<br>Operations | Fund | Realized<br> Gain or<br> (Loss) on<br> Derivatives | Change in Unrealized<br> Appreciation or<br> (Depreciation) on<br> Derivatives |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares Quality Dividend Defensive Index Fund | $(874263) | $(138287) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation <br>(depreciation) on Futures contracts | FlexShares Quality Dividend Dynamic Index Fund | (41226) | (19610) |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in <br>unrealized appreciation (depreciation) on Futures contracts | FlexShares International Quality Dividend Index Fund | (2280920) | (335187) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on <br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares International Quality Dividend Index Fund | (813046) | 81207 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on <br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares International Quality Dividend Defensive Index Fund | (422328) | (18210) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on<br>Foreign currency transactions, Net change in unrealized appreciation<br>(depreciation) on Forward foreign currency contracts | FlexShares International Quality Dividend Defensive Index Fund | 174674 | 4749 |
| Equity <br>Index Futures <br>Contracts | Net realized gain (loss) on<br>Futures contracts, Net change in unrealized appreciation (depreciation) on Futures contracts | FlexShares International Quality Dividend Dynamic Index Fund | (481777) | (30953) |
| Foreign <br>Currency <br>Contracts | Net realized gain (loss) on<br>Foreign currency transactions, Net change in unrealized appreciation (depreciation) on Forward foreign currency contracts | FlexShares International Quality Dividend Dynamic Index Fund | 96732 | 5959 |
| Interest Rate <br>Futures Contracts | Net realized gain (loss) on<br>Futures contracts,<br>Net change in<br>unrealized appreciation<br>(depreciation) on<br>Futures contracts | FlexShares Core Select Bond Fund | 1174 | (3960) |

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FLEXSHARES ANNUAL REPORT 513

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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At October 31, 2022, the volume of derivative activities, which represents activities throughout the period, was as follows:

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Foreign Exchange<br>Contracts | Foreign Exchange<br>Contracts | Equity Contracts | Equity Contracts | Equity Contracts | Equity Contracts | Interest Rate future | Interest Rate future | Interest Rate future | Interest Rate future |
| Fund | Number of<br>Trades | Average<br>Notional<br>Amount | Number of<br>Trades<br>Long | Average<br>Notional<br>Balance<br>Long | Number<br>of<br>Trades<br>Short | Average<br>Notional<br>Balance Short | Number<br>of<br>Trades<br>Long | Average<br>Notional<br>Balance Long | Number of<br>Trades<br>Short | Average<br>Notional<br>Balance Short |
| FlexShares US Quality Low Volatility Index Fund |  | $— | 49 | $269366 |  | $— |  | $— |  | $— |
| FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | 239 | 57433 | 42 | 205488 |  |  |  |  |  |  |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 20 | 17439 | 24 | 65068 |  |  |  |  |  |  |
| FlexShares Morningstar US Market Factor Tilt Index Fund |  |  | 160 | 639537 |  |  |  |  |  |  |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 132 | 490419 | 191 | 429420 |  |  |  |  |  |  |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 74 | 274838 | 107 | 270112 |  |  |  |  |  |  |
| FlexShares US Quality Large Cap Index Fund |  |  | 34 | 354764 |  |  |  |  |  |  |
| FlexShares STOXX US ESG Select Index Fund |  |  | 30 | 289836 |  |  |  |  |  |  |
| FlexShares STOXX Global ESG Select Index Fund | 81 | 128109 | 62 | 318816 |  |  |  |  |  |  |
| FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund |  |  | 14 | 52208 |  |  |  |  |  |  |
| FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund | 298 | 10090 | 18 | 70984 |  |  |  |  |  |  |
| FlexShares ESG & Climate Emerging Markets Core Index Fund |  |  | 3 | 51179 |  |  |  |  |  |  |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 362 | 1765892 | 478 | 1380693 | 1 | 1258899 |  |  |  |  |
| FlexShares STOXX Global Broad Infrastructure Index Fund | 126 | 1837233 | 306 | 870597 |  |  |  |  |  |  |
| FlexShares Global Quality Real Estate Index Fund | 134 | 324052 | 112 | 562297 |  |  |  |  |  |  |
| FlexShares Quality Dividend Index Fund |  |  | 95 | 1204120 |  |  |  |  |  |  |
| FlexShares Quality Dividend Defensive Index Fund |  |  | 67 | 595820 |  |  |  |  |  |  |
| FlexShares Quality Dividend Dynamic Index Fund |  |  | 30 | 74171 |  |  |  |  |  |  |
| FlexShares International Quality Dividend Index Fund | 265 | 405623 | 247 | 420207 |  |  |  |  |  |  |

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514 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Foreign Exchange<br>Contracts | Foreign Exchange<br>Contracts | Equity Contracts | Equity Contracts | Equity Contracts | Equity Contracts | Interest Rate future | Interest Rate future | Interest Rate future | Interest Rate future |
| Fund | Number of<br>Trades | Average<br>Notional<br>Amount | Number of<br>Trades<br>Long | Average<br>Notional<br>Balance<br>Long | Number<br>of<br>Trades<br>Short | Average<br>Notional<br>Balance Short | Number<br>of<br>Trades<br>Long | Average<br>Notional<br>Balance Long | Number of<br>Trades<br>Short | Average<br>Notional<br>Balance Short |
| FlexShares International Quality Dividend Defensive Index Fund | 84 | $97384 | 79 | $129978 |  | $— |  | $— |  | $— |
| FlexShares International Quality Dividend Dynamic Index Fund | 153 | 49652 | 83 | 143247 |  |  |  |  |  |  |
| FlexShares Core Select Bond Fund |  |  |  |  |  |  | 4 | 3459118 | 1 | 5866800 |

---

**Taxes and Distributions** 

Each Fund has qualified and intends to continue to qualify as a regulated investment company by complying with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, which includes distributing substantially all of its net investment income and net capital gains to shareholders. Accordingly, no provision for federal and state income taxes is required in the financial statements.

As of October 31, 2022, management of the Funds has reviewed all open tax years and major jurisdictions and concluded that there is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken in future tax returns. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next 12 months. On an ongoing basis management will monitor the tax positions taken to determine if adjustment to conclusions are necessary based on factors including but not limited to further implementation on guidance expected from FASB and on-going analysis of tax law, regulation, and interpretations thereof.

Dividends from net investment income, including any net foreign currency gains, are generally declared and paid by each Fund according to the following schedule:

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| | | | |
|:---|:---|:---|:---|
| Fund | Declared<br> And Paid<br>Monthly | Declared<br> And Paid<br>Quarterly | Declared<br> And Paid<br>Quarterly |
| FlexShares US Quality Low Volatility Index Fund | | | x |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | | | x |

---

---

| | | |
|:---|:---|:---|
| Fund | Declared<br> And Paid<br>Monthly | Declared<br> And Paid<br>Quarterly |
| FlexShares Emerging Markets Quality Low Volatility Index Fund |  | x |
| FlexShares Morningstar US Market Factor Tilt Index Fund |  | x |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund |  | x |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund |  | x |
| FlexShares US Quality Large Cap Index Fund |  | x |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund |  | x |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund |  | x |
| FlexShares ESG & Climate US Large Cap Core Index Fund |  | x |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund |  | x |
| FlexShares ESG & Climate Emerging Markets Core Index Fund |  | x |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund |  | x |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund |  | x |
| FlexShares Global Quality Real Estate Index Fund |  | x |
| FlexShares Real Assets Allocation Index Fund |  | x |
| FlexShares Quality Dividend Index Fund |  | x |

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FLEXSHARES ANNUAL REPORT 515

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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| | | |
|:---|:---|:---|
| Fund | Declared<br> And Paid<br>Monthly | Declared<br> And Paid<br>Quarterly |
| FlexShares Quality Dividend Defensive Index Fund |  | x |
| FlexShares Quality Dividend Dynamic Index Fund |  | x |
| FlexShares International Quality Dividend Index Fund |  | x |
| FlexShares International Quality Dividend Defensive Index Fund |  | x |
| FlexShares International Quality Dividend Dynamic Index Fund |  | x |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | x |  |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | x |  |
| FlexShares Disciplined Duration MBS Index Fund | x |  |
| FlexShares Credit-Scored US Corporate Bond Index Fund | x |  |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | x |  |
| FlexShares High Yield Value-Scored Bond Index Fund | x |  |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | x |  |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | x |  |
| FlexShares Ready Access Variable Income Fund | x |  |
| FlexShares Core Select Bond Fund | x |  |

---

Distribution of net realized securities gains, if any, generally are distributed at least annually. The Trust reserves the right to declare special distributions if, in its reasonable discretion, such action is necessary or advisable to improve tracking error, to preserve its status as a regulated investment company or to avoid imposition of income or excise taxes on undistributed income or realized gains. Tracking error is a measurement of how much the return on a portfolio deviates from the return on its benchmark index.

Dividends and securities gains distributions are distributed in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds. The amount of distributions from net investment income and net realized gains are determined in accordance with federal income tax regulations, which may differ from GAAP. These "book/tax" differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences (e.g., wash sales) do not require a reclassification. The Funds may utilize equalization accounting for tax purposes and designate earnings and profits, including net realized gains distributed to shareholders on redemption of shares, as a part of the dividends paid deduction for income tax purposes.

The Funds' tax year end is October 31st and the tax character of current year distributions and current components of accumulated earnings (deficit) will be determined at the end of the current tax year.

Temporary differences are generally due to different book and tax treatments for the timing of the recognition of gains and losses on certain investment transactions, mark to market of forward foreign currency contracts, mark to market of futures contracts, mark to market of passive foreign investment companies ("PFICs"), non-taxable special dividends, wash sale loss deferrals and capital loss carryforward.

516 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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Permanent differences, primarily due to gain (loss) on in-kind redemptions, paydown loss reclassification, foreign currency gains and losses, forward foreign currency gains and losses, PFICs gains and losses, non-taxable special dividends, investments in partnerships, taxable over-distributions, foreign capital gains tax reclassification, perpetual bonds and equalization as of October 31, 2022 (the Funds' tax year end), among the Funds' components of net assets are as follows:

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| | | | |
|:---|:---|:---|:---|
| Fund | Accumulated<br>undistributed net<br>investment income (loss) | Accumulated net<br>realized gain (loss) on<br>investments | Paid in<br>capital |
| FlexShares US Quality Low Volatility Index Fund | $(49000) | $(8245501) | $8294501 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund<sup>\*</sup> | 64139 | (1296335) | 1232196 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | (62129) | 189874 | (127745) |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 53310 | (75068286) | 75014976 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 1291238 | (7763138) | 6471900 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 703373 | (1942934) | 1239561 |
| FlexShares US Quality Large Cap Index Fund | (30456) | (14109064) | 14139520 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | (9586) | (8336058) | 8345644 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | (84515) | (8216271) | 8300786 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | (454) | (78184) | 78638 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | (9448) | 9448 |  |
| FlexShares ESG & Climate Emerging Markets Core Index Fund<sup>\*</sup> | 6538 | (6538) |  |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 9674086 | (609075652) | 599401566 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | (2186383) | (19044616) | 21230999 |
| FlexShares Global Quality Real Estate Index Fund | 285226 | (10017620) | 9732394 |
| FlexShares Real Assets Allocation Index Fund | 4101 | 171835 | (175936) |
| FlexShares Quality Dividend Index Fund | (824618) | (124758056) | 125582674 |
| FlexShares Quality Dividend Defensive Index Fund | (19352) | (44515942) | 44535294 |
| FlexShares Quality Dividend Dynamic Index Fund | (7251) | (1579856) | 1587107 |
| FlexShares International Quality Dividend Index Fund | 324772 | (2530244) | 2205472 |
| FlexShares International Quality Dividend Defensive Index Fund | (136324) | (102441) | 238765 |
| FlexShares International Quality Dividend Dynamic Index Fund | (65013) | 55537 | 9476 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund |  | (973226) | 973226 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund |  | 1273433 | (1273433) |
| FlexShares Disciplined Duration MBS Index Fund | 1672172 | (1672172) |  |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 231066 | 590713 | (821779) |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 9186 | (9186) |  |
| FlexShares High Yield Value-Scored Bond Index Fund | 970549 | (150459) | (820090) |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 104367 | (27484) | (76883) |

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FLEXSHARES ANNUAL REPORT 517

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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| | | | |
|:---|:---|:---|:---|
| Fund | Accumulated<br>undistributed net<br>investment income (loss) | Accumulated net<br>realized gain (loss) on<br>investments | Paid in<br>capital |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | $30446 | $(30446) | $— |
| FlexShares Ready Access Variable Income Fund | 234314 | (234314) |  |
| FlexShares Core Select Bond Fund | 74000 | (131570) | 57570 |

---

*\** *Commencement of operations on April 20, 2022* 

As of October 31, 2022, the tax character of distributions paid for the tax year ended October 31, 2022, and October 31, 2021, were as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 |
| Fund | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax Return<br>of Capital | Total<br>Distributions | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax Return<br>of Capital | Total<br>Distributions |
| FlexShares US Quality Low Volatility Index Fund | $2196287 | $— | $— | $2196287 | $1694565 | $— | $— | $1694565 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 2140729 |  |  | 2140729 | 2249889 |  |  | 2249889 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 416284 |  | 24777 | 441061 | 269007 |  |  | 269007 |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 22299297 |  |  | 22299297 | 19993786 |  |  | 19993786 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 22504833 |  | 992999 | 23497832 | 13410048 |  |  | 13410048 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 12431512 |  |  | 12431512 | 6011707 |  |  | 6011707 |
| FlexShares US Quality Large Cap Index Fund | 1808374 |  |  | 1808374 | 1136947 |  |  | 1136947 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 2266829 |  |  | 2266829 | 1955493 |  |  | 1955493 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 3114461 |  |  | 3114461 | 2324712 |  |  | 2324712 |
| FlexShares ESG & Climate US Large Cap Core Index Fund<sup>\*</sup> | 128991 | 706 |  | 129697 |  |  |  |  |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund<sup>\*</sup> | 406987 |  |  | 406987 |  |  |  |  |
| FlexShares ESG & Climate Emerging Markets Core Index Fund<sup>\*\*</sup> | 65664 |  |  | 65664 |  |  |  |  |

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518 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

------

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 |
| Fund | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax Return<br>of Capital | Total<br>Distributions | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax Return<br>of Capital | Total<br>Distributions |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | $349767759 | $— | $— | $349767759 | $167354837 | $— | $— | $167354837 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 71164043 |  |  | 71164043 | 58905802 |  |  | 58905802 |
| FlexShares Global Quality Real Estate Index Fund | 12433295 |  | 212283 | 12645578 | 5654125 |  |  | 5654125 |
| FlexShares Real Assets Allocation Index Fund | 1056448 |  |  | 1056448 | 383940 |  |  | 383940 |
| FlexShares Quality Dividend Index Fund | 36901147 |  |  | 36901147 | 31171462 |  |  | 31171462 |
| FlexShares Quality Dividend Defensive Index Fund | 9019363 |  |  | 9019363 | 9806498 |  |  | 9806498 |
| FlexShares Quality Dividend Dynamic Index Fund | 436719 |  |  | 436719 | 369573 |  |  | 369573 |
| FlexShares International Quality Dividend Index Fund | 29536094 |  |  | 29536094 | 20693535 |  |  | 20693535 |
| FlexShares International Quality Dividend Defensive Index Fund | 2940092 |  |  | 2940092 | 2683528 |  |  | 2683528 |
| FlexShares International Quality Dividend Dynamic Index Fund | 4368329 |  |  | 4368329 | 1876931 |  |  | 1876931 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 131367411 |  | 2470987 | 133838398 | 61292947 |  |  | 61292947 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 53319431 |  | 769089 | 54088520 | 26674665 |  |  | 26674665 |
| FlexShares Disciplined Duration MBS Index Fund | 2906209 |  |  | 2906209 | 2676548 |  |  | 2676548 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 6279015 | 2010194 |  | 8289209 | 5773883 | 2289107 |  | 8062990 |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 2152418 | 685037 |  | 2837455 | 2144280 | 1395700 |  | 3539980 |
| FlexShares High Yield Value-Scored Bond Index Fund | 55009030 | 1007533 |  | 56016563 | 14813070 | 16736 |  | 14829806 |

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FLEXSHARES ANNUAL REPORT 519

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2022 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 | Year Ended October 31, 2021 |
| Fund | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax<br>Return<br>of<br>Capital | Total<br>Distributions | Distributions<br>paid from<br>ordinary<br>income | Distributions<br>paid from net<br>long term<br>capital gains | Tax Return<br>of Capital | Total<br>Distributions |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund<sup>\*</sup> | $1310115 | $— | $— | $1310115 | $— | $— | $— | $— |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund<sup>\*</sup> | 1093741 |  |  | 1093741 |  |  |  |  |
| FlexShares Ready Access Variable Income Fund | 7279652 | 627909 |  | 7907561 | 3117345 | 134219 |  | 3251564 |
| FlexShares Core Select Bond Fund | 3352156 |  |  | 3352156 | 2693092 |  |  | 2693092 |

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*\** *Commencement of operations on September 20, 2021* 

*\*\** *Commencement of operations on April 20, 2022* 

As of October 31, 2022, the components of accumulated earnings (deficit) on a tax basis were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| Fund | Undistributed<br>Ordinary<br>Income | Undistributed<br>Long-Term<br>Capital Gains | Accumulated<br>Capital and<br>Other Losses | Unrealized<br>Appreciated/<br>(Depreciated) |
| FlexShares US Quality Low Volatility Index Fund | $443720 | $— | $(3965001) | $10976424 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 72612 |  | (3932291) | (6040569) |
| FlexShares Emerging Markets Quality Low Volatility Index Fund |  |  | (985750) | (1430277) |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 2601980 |  | (22452231) | 452807296 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund |  |  | (116379809) | (30399365) |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 1988189 |  | (68796916) | (26436545) |
| FlexShares US Quality Large Cap Index Fund | 192159 |  | (4699726) | (1474517) |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 194179 |  | (6613232) | 929691 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 53040 |  | (6632822) | 9501007 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 36292 |  | (216945) | (2008962) |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 42162 |  | (925585) | (3526298) |
| FlexShares ESG & Climate Emerging Markets Core Index Fund\* | 18433 |  | (51422) | (1108652) |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 6814532 |  | (1119885158) | 818144918 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 1168185 |  | (173630178) | (77821294) |
| FlexShares Global Quality Real Estate Index Fund |  |  | (33721558) | (42368809) |
| FlexShares Real Assets Allocation Index Fund |  |  | (271695) | (5427432) |
| FlexShares Quality Dividend Index Fund | 3760862 |  | (57365538) | 138953654 |
| FlexShares Quality Dividend Defensive Index Fund | 938180 |  | (28016419) | 21848803 |

---

520 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| Fund | Undistributed<br>Ordinary<br>Income | Undistributed<br>Long-Term<br>Capital Gains | Accumulated<br>Capital and<br>Other Losses | Unrealized<br>Appreciated/<br>(Depreciated) |
| FlexShares Quality Dividend Dynamic Index Fund | $39170 | $— | $(299661) | $1416167 |
| FlexShares International Quality Dividend Index Fund | 1294901 |  | (182325729) | (79532104) |
| FlexShares International Quality Dividend Defensive Index Fund | 54561 |  | (28051463) | (5303787) |
| FlexShares International Quality Dividend Dynamic Index Fund | 129907 |  | (19495362) | (14857417) |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund |  |  | (90264517) | (132384540) |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund |  |  | (16258698) | (71520022) |
| FlexShares Disciplined Duration MBS Index Fund | 290454 |  | (10097240) | (11181553) |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 601927 |  | (10794089) | (30786549) |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 159565 |  | (5043210) | (13161809) |
| FlexShares High Yield Value-Scored Bond Index Fund | 6347958 |  | (66639338) | (109000658) |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 39723 |  | (3611311) | (323339) |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | 67233 |  | (5243773) | (5228485) |
| FlexShares Ready Access Variable Income Fund | 2028215 |  | (1049751) | (10971448) |
| FlexShares Core Select Bond Fund |  |  | (10127773) | (19710061) |

---

*\** *Commencement of operations on April 20, 2022* 

Capital loss carry forwards will retain their character as either short-term or long-term capital losses rather than being considered all short-term as permitted under previous law and may be carried forward indefinitely to offset future gains.

For the tax year ended October 31, 2022, the following Funds had available post-enactment capital loss carryforwards to offset future net capital gains to the extent provided by regulations:

---

| | | | |
|:---|:---|:---|:---|
| Fund | Short-Term | Long-Term | Total |
| FlexShares US Quality Low Volatility Index Fund | $3494416 | $470585 | $3965001 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 2892961 | 1039330 | 3932291 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 521035 | 464715 | 985750 |

---

---

| | | | |
|:---|:---|:---|:---|
| Fund | Short-Term | Long-Term | Total |
| FlexShares Morningstar US Market Factor Tilt Index Fund | $22452231 | $— | $22452231 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 29650498 | 86729311 | 116379809 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 22940244 | 45856672 | 68796916 |
| FlexShares US Quality Large Cap Index Fund | 2810896 | 1888830 | 4699726 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 6613232 |  | 6613232 |

---

FLEXSHARES ANNUAL REPORT 521

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Fund | Short-Term | Long-Term | Total |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | $6632822 | $— | $6632822 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 202926 | 14019 | 216945 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 899617 | 25968 | 925585 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund\* | 44481 | 6941 | 51422 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 241429413 | 878455745 | 1119885158 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 59654917 | 113975261 | 173630178 |
| FlexShares Global Quality Real Estate Index Fund | 33721558 |  | 33721558 |
| FlexShares Real Assets Allocation Index Fund | 108457 | 163238 | 271695 |

---

---

| | | | |
|:---|:---|:---|:---|
| Fund | Short-Term | Long-Term | Total |
| FlexShares Quality Dividend Index Fund | $52796431 | $4569107 | $57365538 |
| FlexShares Quality Dividend Defensive Index Fund | 27514225 | 502194 | 28016419 |
| FlexShares Quality Dividend Dynamic Index Fund | 299661 |  | 299661 |
| FlexShares International Quality Dividend Index Fund | 120357909 | 61967820 | 182325729 |
| FlexShares International Quality Dividend Defensive Index Fund | 17601455 | 10450008 | 28051463 |
| FlexShares International Quality Dividend Dynamic Index Fund | 13053720 | 6441642 | 19495362 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 86611124 | 3653393 | 90264517 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 15678204 | 580494 | 16258698 |
| FlexShares Disciplined Duration MBS Index Fund | 7540905 | 2556335 | 10097240 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 5663463 | 5130626 | 10794089 |

---

522 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

------

---

| | | | |
|:---|:---|:---|:---|
| Fund | Short-Term | Long-Term | Total |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | $2297540 | $2745670 | $5043210 |
| FlexShares High Yield Value-Scored Bond Index Fund | 53750929 | 12888409 | 66639338 |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 3578170 | 33141 | 3611311 |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | 5149824 | 93949 | 5243773 |
| FlexShares Ready Access Variable Income Fund | 768784 | 280967 | 1049751 |
| FlexShares Core Select Bond Fund | 4179186 | 5948587 | 10127773 |

---

*\** *Commencement of operations on April 20, 2022* 

During the year ended October 31, 2022, the following Funds utilized capital loss carryforwards to offset net capital gains:

---

| | |
|:---|:---|
| Fund | Capital Loss<br>Utilized |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | $4561790 |
| FlexShares Global Quality Real Estate Index Fund | 3403614 |

---

The FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX<sup>®</sup> Global Broad Infra-

structure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund and the FlexShares ESG & Climate Investment Grade Corporate Core Index Fund may be subject to foreign withholding taxes with respect to dividends or interest received from sources in foreign countries. If, at the close of the taxable year, more than 50% in value of a Fund's assets consists of stock or securities in foreign corporations the Fund will be eligible to make an election to treat a proportionate amount of those taxes as constituting a distribution to each shareholder, which would allow all shareholders to either (1) credit that proportionate amount of taxes against U.S. Federal income tax liability as a foreign tax credit or (2) take that amount as an itemized deduction. If a Fund is not eligible to make this election or is eligible but does not make the election, it will be entitled to deduct such taxes in computing the amounts it is required to distribute.

**3. Investment Transactions and Related Income and Expense** 

------

Throughout the reporting period, investment transactions are accounted for no later than one business day following the trade date. For financial reporting purposes, investment transactions are accounted for on the trade date on the last business day of the reporting period.

Interest income is recognized on an accrual basis. Bond discount is accreted and premium is amortized using the effective yield method. Dividend income is recorded on the ex-dividend date, or as soon as information is available. Gains or losses realized on sales of securities are determined using the specific identification method by comparing the identified cost of the security lot sold with the net sales proceeds.

Each Fund except the FlexShares iBoxx 3-Year Target Duration TIPs Index Fund, and the FlexShares iBoxx 5-Year Target Duration TIPs Index Fund may hold the securities of real estate investment trusts ("REITs"). Distributions from

FLEXSHARES ANNUAL REPORT 523

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

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such investments may be comprised of return of capital, capital gains and income. The actual character of amounts received during the year is not known until after the REIT's fiscal year end. The Fund records the character of distributions received from REITs during the year based on estimates available. The characterization of distributions received by the Fund may be subsequently revised based on information received from the REITs after their tax reporting periods concluded.

All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign markets in which a Fund invests. These foreign taxes, if any, are paid by the Funds and disclosed in the Statements of Operations. Foreign taxes payable, if any, are reflected in the Funds' Statements of Assets and Liabilities.

Expenses directly attributable to a Fund are charged to that Fund, while expenses which are attributable to more than one Fund are allocated among the respective Funds based upon relative net assets or another reasonable basis.

**4. Investment Advisory Fees** 

------

NTI serves as the Investment Adviser of the Funds pursuant to the Investment Advisory Agreement. The Investment Adviser is responsible for making investment decisions for the Funds and for placing purchase and sale orders for portfolio securities, subject to the general supervision of the Board.

As compensation for its advisory services and assumption of certain Fund expenses, NTI is entitled to a unitary management fee ("Management Fee"), computed daily and payable monthly, at the annual rates set forth in the table below (expressed as a percentage of each Fund's respective average daily net assets).

From the Management Fee, NTI pays most of the expenses of the Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services ("Covered Expenses"). Covered Expenses do not include the following fees under the Investment Advisory Agreement: its advisory fees payable under the Advisory Agreement, distribution fees and expenses paid by the Trust under any distribution plan adopted pursuant to Rule 12b-1, interest expenses, brokerage commissions and other trading expenses, fees and expenses of the independent trustees and

their independent legal counsel, taxes and other extraordinary costs such as litigation and other expenses not incurred in the ordinary course of business.

The Management Fee rate payable by each Fund is set forth in the following table:

---

| | | |
|:---|:---|:---|
| Fund | Unitary<br>Management Fee |  |
| FlexShares US Quality Low Volatility Index Fund | 0.22 | % |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 0.32 | % |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 0.40 | % |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 0.25 | % |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 0.39 | % |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 0.59 | % |
| FlexShares US Quality Large Cap Index Fund | 0.25 | %<sup>\*</sup> |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 0.32 | % |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 0.42 | % |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 0.09 | % |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 0.12 | % |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 0.18 | % |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 0.46 | % |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 0.47 | % |
| FlexShares Global Quality Real Estate Index Fund | 0.45 | % |
| FlexShares Real Assets Allocation Index Fund | 0.57 | % |
| FlexShares Quality Dividend Index Fund | 0.37 | % |

---

524 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

------

---

| | |
|:---|:---|
| Fund | Unitary<br>Management Fee |
| FlexShares Quality Dividend Defensive Index Fund | 0.37% |
| FlexShares Quality Dividend Dynamic Index Fund | 0.37% |
| FlexShares International Quality Dividend Index Fund | 0.47% |
| FlexShares International Quality Dividend Defensive Index Fund | 0.47% |
| FlexShares International Quality Dividend Dynamic Index Fund | 0.47% |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 0.18% |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 0.18% |
| FlexShares Disciplined Duration MBS Index Fund | 0.20% |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 0.22% |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 0.22% |
| FlexShares High Yield Value-Scored Bond Index Fund | 0.37% |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 0.23% |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | 0.12% |
| FlexShares Ready Access Variable Income Fund | 0.25% |
| FlexShares Core Select Bond Fund | 0.35% |

---

*\** *Prior to July 11, 2022, the Unitary Management Fee was 0.32%.* 

The Investment Adviser has contractually agreed until March 1, 2023 to reimburse a portion of the operating expenses of each Fund (other than acquired fund fees and expenses ("AFFE")) so the "Total Annual Fund Operating Expenses After Expense Reimbursement" do not exceed the Fund's Management Fee plus (+) 0.0049%. In the case of the FlexShares Real Assets Allocation Index Fund, the Investment Adviser has contractually agreed until March 1, 2023 to waive Management Fees or reimburse certain expenses in an amount equal to the AFFE attributable to the Fund's invest-

ments in its Underlying Funds. After these dates, the contractual arrangements will continue automatically thereafter for periods of one year (each such one-year period, a "Renewal Year"). The contractual arrangements may be terminated, with respect to a Fund, as to any succeeding Renewal Year, by NTI or the Fund upon 60 days' written notice prior to the end of the current Renewal Year. The Board may terminate the arrangements at any time with respect to a Fund if it determines that it is in the best interest of the Fund and its shareholders. In the case of the FlexShares Core Select Bond Fund, the Investment Adviser has contractually agreed until March 1, 2023 to waive Management Fees or reimburse certain expenses in an amount equal to the sum of (a) any AFFE incurred by the Fund that are attributable to the Fund's investment in Acquired Funds managed by NTI or an investment adviser controlling, controlled by, or under common control with NTI ("Affiliated Funds"); and (b) 0.05% or such lesser amount in AFFE incurred by the Fund that are attributable to the Fund's investment in Underlying Funds that are not Affiliated Funds. AFFE are expenses incurred indirectly by the Fund through its ownership of shares in other investment companies. Because AFFE are not direct expenses of a Fund, they are not reflected on a Fund's financial statements. After these dates, the contractual expense reimbursement agreements continue automatically for periods of one year unless terminated, as to any succeeding renewal year, by either party upon 60 days' written notice prior to the end of the current term. The Board may terminate the contractual expense reimbursement agreements discussed above with respect to any Fund at any time if it determines that it is in the best interest of a Fund and its shareholders. These expenses and the reimbursements are shown as "Investment advisory fees reimbursed" on the Statements of Operations.

The Investment Adviser may voluntarily waive or reimburse additional management fees or expenses. Any such additional voluntary expense reimbursement or fee waiver could be implemented, increased or decreased, or discontinued at any time. Amounts waived or reimbursed by the Investment Adviser pursuant to voluntary or contractual agreements discussed above may not be recouped by the Investment Adviser. These waivers and/or reimbursements are shown as Expenses waived and/or reimbursed by Advisor on the

FLEXSHARES ANNUAL REPORT 525

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

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Statements of Operations. As of the year ended October 31, 2022, the Investment Adviser did not voluntarily waive or reimburse additional management fees.

**5. Administration Fees** 

------

Per terms of agreements JPMorgan Chase Bank, N.A. (the "Administrator") serves as administrator of the Funds. The Administrator provides certain administrative services to the Funds. For these services, the Administrator is entitled to certain fees and reasonable out-of-pocket expenses. These fees and expenses are Covered Expenses as defined above.

**6. Custodian Fees** 

------

JPMorgan Chase Bank, N.A. (the "Custodian") acts as custodian for the Funds in accordance with a Global Custody Agreement. The Custodian holds cash, securities and other assets of the Funds as required by the 1940 Act. As compensation for the services rendered under the agreement, the Custodian is entitled to fees and reasonable out-of-pocket expenses. These fees and expenses are Covered Expenses as defined above.

**7. Trustees Fees** 

------

The Trust compensates each Trustee who is not an officer, director or employee of Northern Trust Corporation, or its subsidiaries, for his or her services as a Trustee of the Trust and as a member of Board committees.

The Trust has adopted a deferred compensation plan (the "DC Plan") for its Trustees who are not officers of Northern Trust or NTI. Under the DC Plan, Independent Trustees may elect to defer all or a portion of their compensation. The amount deferred is adjusted periodically based upon the performance of the investment options selected by the Trustees. The investment options currently available under the DC Plan are the FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Quality Dividend Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, and the FlexShares Ready Access Variable Income Fund. Expenses related to the DC Plan are stated on the Statements of Operations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**8. Distribution and Service Plan** 

------

Foreside Fund Services, LLC (the "Distributor") serves as the Funds' distributor and distributes Creation Units (as described in Note 9) for each Fund on an agency basis. The Distributor does not receive a fee from the Funds for its distribution services. However, it receives compensation from NTI for its services as distributor pursuant to a separate letter agreement between it and NTI.

The Trust has adopted a Distribution and Service Plan ("the Plan") pursuant to Rule 12b-1 under the 1940 Act. Payments to financial intermediaries under the Plan are tied directly to their own out-of-pocket expenses. The Plan has not been implemented with respect to the Funds. The Plan may not be implemented without further Board approval. The maximum distribution fee is 0.25% of each Fund's respective average daily net assets under the Plan. The Funds did not pay any 12b-1 fees during the fiscal year.

**9. Issuance and Redemption of Fund Shares** 

------

Each Fund only issues and redeems shares to Authorized Participants in exchange for the deposit or delivery of a basket of assets (securities and/or cash), in large blocks known as Creation Units, each of which is comprised of a specified number of shares.

Retail investors may only purchase and sell fund shares in the secondary market through a broker-dealer and such transactions may be subject to customary commission and fee rates imposed by the broker-dealer.

Authorized Participants may pay transaction fees to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units. The transaction fees are paid directly to the Fund and used to offset Fund custody fees. Certain fees or costs associated with Creation Unit purchases may be paid by NTI in certain circumstances. In addition, the Trust may from time to time waive the standard transaction fee. The net custody fees charged to the Fund are paid for by the

526 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

------

Investment Adviser through the Fund's Unitary Fee. Transaction fees remaining in the Funds were as follows:

---

| | | |
|:---|:---|:---|
| Fund | As of<br>October 31,<br>2022 | As of<br>October 31,<br>2021 |
| FlexShares US Quality Low Volatility Index Fund | $— | $1400 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund |  | 9000 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 4000 |  |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 6000 | 4500 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 13500 | 27000 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 50000 | 50000 |
| FlexShares US Quality Large Cap Index Fund | 3000 | 2500 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 1050 | 1400 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund |  | 13000 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 500 |  |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 28500 | 40500 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 26000 | 28000 |
| FlexShares Global Quality Real Estate Index Fund | 2000 | 6000 |
| FlexShares Quality Dividend Index Fund | 5650 | 4600 |
| FlexShares Quality Dividend Defensive Index Fund | 2150 | 2850 |
| FlexShares Quality Dividend Dynamic Index Fund | 400 | 1450 |
| FlexShares International Quality Dividend Index Fund | 12000 | 8500 |

---

---

| | | |
|:---|:---|:---|
| Fund | As of<br>October 31,<br>2022 | As of<br>October 31,<br>2021 |
| FlexShares International Quality Dividend Defensive Index Fund | $7000 | $— |
| FlexShares International Quality Dividend Dynamic Index Fund | 3500 | 7000 |
| FlexShares Disciplined Duration MBS Index Fund | 1600 | 400 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 2500 | 2500 |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 1000 |  |
| FlexShares High Yield Value-Scored Bond Index Fund | 4000 | 10500 |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 500 |  |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | 1500 |  |
| FlexShares Ready Access Variable Income Fund | 4025 | 525 |

---

The FlexShares Real Assets Allocation Index Fund, FlexShares iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund and the FlexShares Core Select Bond Fund do not charge standard creation unit transaction fees.

**10. Investment Transactions** 

------

For the period ended October 31, 2022, the FlexShares iBoxx 3-Year Target Duration TIPS Index, FlexShares iBoxx 5-Year Target Duration TIPS Index and FlexShares Disciplined Duration MBS Index Funds invested solely in U.S. Government, including U.S. government agency, securities. The cost of securities purchased by each Fund and proceeds from sales of securities, excluding short-term securities,

FLEXSHARES ANNUAL REPORT 527

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##### [**Table of Contents**](#toc)

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Notes to the Financial Statements (cont.)

------

derivatives and in-kind transactions for the period ended October 31, 2022, were as follows:

---

| | | |
|:---|:---|:---|
| Fund | Purchases | Sales |
| FlexShares US Quality Low Volatility Index Fund | $77685812 | $78207530 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 40568141 | 38892587 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 7377095 | 11367052 |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 213636838 | 215141808 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 144309333 | 162139620 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 94902088 | 124993055 |
| FlexShares US Quality Large Cap Index Fund | 31176414 | 31250865 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 84145128 | 84451172 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 98390730 | 88413408 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 1966321 | 1937687 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 5028020 | 4186394 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 4539322 | 816417 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 2391949833 | 2279278538 |

---

---

| | | |
|:---|:---|:---|
| Fund | Purchases | Sales |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | $419150115 | $414035975 |
| FlexShares Global Quality Real Estate Index Fund | 211567422 | 212316627 |
| FlexShares Real Assets Allocation Index Fund | 2440529 | 2442647 |
| FlexShares Quality Dividend Index Fund | 648710993 | 643782527 |
| FlexShares Quality Dividend Defensive Index Fund | 189629100 | 193582198 |
| FlexShares Quality Dividend Dynamic Index Fund | 9738491 | 10540326 |
| FlexShares International Quality Dividend Index Fund | 369490308 | 369805953 |
| FlexShares International Quality Dividend Defensive Index Fund | 39114675 | 43273564 |
| FlexShares International Quality Dividend Dynamic Index Fund | 57392772 | 54153244 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 2204214189 | 2325200689 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 592631734 | 641057363 |
| FlexShares Disciplined Duration MBS Index Fund | 245965803 | 240714028 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 174364897 | 202149333 |
| FlexShares Credit-Scored US Long Corporate Bond Index Fund | 28328598 | 32759354 |
| FlexShares High Yield Value-Scored Bond Index Fund | 1528773108 | 1121233848 |

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528 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

------

Notes to the Financial Statements (cont.)

------

---

| | | |
|:---|:---|:---|
| Fund | Purchases | Sales |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | $27461859 | $42594636 |
| FlexShares ESG & Climate Investment Grade Corporate Core Index Fund | 27117224 | 43006813 |
| FlexShares Ready Access Variable Income Fund | 264602955 | 187518660 |
| FlexShares Core Select Bond Fund | 175240304 | 177005699 |

---

**11. In-Kind Transactions** 

------

During the year ended October 31, 2022, certain Funds received securities in exchange for subscriptions of shares (subscriptions-in-kind). For the period ended October 31, 2022, the fair value of the securities received for subscriptions for each Fund was as follows:

---

| | |
|:---|:---|
| Fund | Fair Value |
| FlexShares US Quality Low Volatility Index Fund<sup>\*</sup> | $51323012 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund<sup>\*</sup> | 6953193 |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 58533847 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 10705005 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 1401470 |
| FlexShares US Quality Large Cap Index Fund | 56161544 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 37110384 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 6676848 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 24781657 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 15614435 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 1249166 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 1927587442 |

---

---

| | |
|:---|:---|
| Fund | Fair Value |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | $355893861 |
| FlexShares Global Quality Real Estate Index Fund | 56214297 |
| FlexShares Real Assets Allocation Index Fund | 31090090 |
| FlexShares Quality Dividend Index Fund | 502584146 |
| FlexShares Quality Dividend Defensive Index Fund | 98535580 |
| FlexShares Quality Dividend Dynamic Index Fund | 5822908 |
| FlexShares International Quality Dividend Index Fund | 19928105 |
| FlexShares International Quality Dividend Dynamic Index Fund | 10165626 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 1152233835 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 258270229 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 6995124 |
| FlexShares High Yield Value-Scored Bond Index Fund | 79251950 |
| FlexShares Core Select Bond Fund | 72859326 |

---

During the year ended October 31, 2022, certain Funds delivered securities in exchange for redemption of shares (redemptions-in-kind). For financial reporting purposes, the Funds recorded net realized gains and losses in connection with each transaction. For the year ended October 31, 2022, the fair value and realized gain (losses) of the securities transferred for redemptions for each Fund were as follows:

---

| | | |
|:---|:---|:---|
| Fund | Fair Value | Net Realized<br>Gains(Losses) |
| FlexShares US Quality Low Volatility Index Fund | $35148856 | $8249158 |
| FlexShares Developed Markets ex-US Quality Low Volatility Index Fund | 7330973 | 1241765 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 450829 | (127745) |

---

FLEXSHARES ANNUAL REPORT 529

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------

Notes to the Financial Statements (cont.)

------

---

| | | |
|:---|:---|:---|
| Fund | Fair Value | Net Realized<br>Gains(Losses) |
| FlexShares Morningstar US Market Factor Tilt Index Fund | $126343854 | $75194221 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 36391968 | 6893368 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 5641090 | 1253873 |
| FlexShares US Quality Large Cap Index Fund | 52301997 | 14142209 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 21057747 | 8342317 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 14564565 | 8341868 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 3240718 | 80873 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 1533994851 | 615401700 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 61626197 | 21478609 |
| FlexShares Global Quality Real Estate Index Fund | 34634023 | 9996330 |
| FlexShares Real Assets Allocation Index Fund | 25668796 | (115194) |
| FlexShares Quality Dividend Index Fund | 451098973 | 124766672 |
| FlexShares Quality Dividend Defensive Index Fund | 161016101 | 44746230 |
| FlexShares Quality Dividend Dynamic Index Fund | 6578716 | 1581915 |
| FlexShares International Quality Dividend Index Fund | 24381043 | 2302932 |
| FlexShares International Quality Dividend Defensive Index Fund | 9128011 | 238765 |

---

---

| | | |
|:---|:---|:---|
| Fund | Fair Value | Net Realized<br>Gains(Losses) |
| FlexShares International Quality Dividend Dynamic Index Fund | $1510239 | $14821 |
| FlexShares iBoxx 3-Year Target Duration TIPS Index Fund | 197866452 | 1449246 |
| FlexShares iBoxx 5-Year Target Duration TIPS Index Fund | 202042765 | 2289950 |
| FlexShares Credit-Scored US Corporate Bond Index Fund | 6798013 | (802474) |
| FlexShares High Yield Value-Scored Bond Index Fund | 21563393 | (747168) |
| FlexShares ESG & Climate High Yield Corporate Core Index Fund | 10100408 | (72176) |
| FlexShares Core Select Bond Fund | 11358002 | 106279 |

---

**12. Guarantees and Indemnifications** 

------

In the normal course of business each Fund enters into contracts with third-party service providers that contain a variety of representations and warranties and that provide general indemnifications. Additionally, under the Funds' organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. The Funds' maximum exposure under these arrangements is unknown, as it involves possible future claims that may or may not be made against the Funds.

**13. New Accounting Pronouncements** 

------

In March 2020, the FASB issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848) "Facilitation of the Effects of Reference Rate Reform on Financial Reporting" ("ASU 2020-04"), which provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the discontinuation of the London Interbank Offered Rate ("LIBOR") and other interbank-offered based reference rates as of the end of 2021. The new guidance is effective for certain reference rate-related contract modifications that

530 FLEXSHARES ANNUAL REPORT

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Notes to the Financial Statements (cont.)

------

occur during the period March 12, 2020 through December 31, 2022, and the adoption of ASU 2020-04 is elective. Management does not believe this update has a material impact on the Funds' financial statements and disclosures.

In December 2020, Rule 2a-5 under the 1940 Act was adopted by the SEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act. The effective date for compliance with Rule 2a-5 was September 8, 2022. Management believes the adoption of Rule 2a-5 did not have a material impact on the financial statements.

**14. LIBOR Transition** 

------

Certain of the Funds' investments, payment obligations and financing terms may be based on floating rates, such as LIBOR, Euro Interbank Offered Rate and other similar types of reference rates (each, a "Reference Rate"). On July 27, 2017, the Chief Executive of the UK Financial Conduct Authority (FCA), which regulates LIBOR, announced that the FCA will no longer persuade nor compel banks to submit rates for the calculation of LIBOR and certain other Reference Rates after 2021. Although many LIBOR rates were phased out as of December 31, 2021 as originally contemplated, a majority of U.S. dollar LIBOR rates will continue to be published until June 30, 2023. The U.S. Federal Reserve, based on the recommendations of the New York Federal Reserve's Alternative Reference Rate Committee (comprised of major derivative market participants and their regulators), has begun publishing the secured overnight financing rate ("SOFR") that is intended to replace U.S. dollar LIBOR. Proposals for alternative reference rates for other currencies have also been announced or have already begun publication. Uncertainty related to the liquidity and value impact of the change in to alternative rates, and how to appropriately adjust these rates at the time of transition, poses risks for the Funds. The effect of any changes to, or discontinuation of, LIBOR on the Funds will depend on, among other things, (1) existing fallback or termination provisions in individual contracts, and (2) whether, how, and when industry participants develop and adopt new reference rates and fallbacks for both legacy and new instruments and contracts. The expected discontinuation of

LIBOR could have a significant impact on the financial markets in general and may also present heightened risk to market participants, including public companies, investment advisers, investment companies, and broker-dealers. The risks associated with this discontinuation and transition will be exacerbated if the work necessary to effect an orderly transition to an alternative reference rate is not completed in a timely manner. Accordingly, it is difficult to predict the full impact of the transition away from LIBOR on the Funds until new reference rates and fallbacks for both legacy and new instruments and contracts are commercially accepted and market practices become settled. Until then, the Funds may continue to invest in instruments that reference such rates or otherwise use such Reference Rates due to favorable liquidity or pricing.

**15. Legal Proceedings** 

------

On or about February 14, 2020, Marc S. Kirschner, as Trustee for NWHI Litigation Trust ("Litigation Trustee") and Wilmington Savings Fund Society, FSB, as indenture Trustee ("Indenture Trustee") for several series of notes issued by Nine West Holdings, Inc. ("Nine West"), filed separate complaints (docket nos. 20-cv-01129 and 20-cv-01136, respectively) in the United States District Court for the Northern District of Illinois against a group of defendants including the FlexShares Morningstar US Market Factor Tilt Index Fund that had invested in The Jones Group Inc. ("Jones Group"). The claims in these actions stem from a series of merger transactions ("Transactions") entered into by Jones Group, Nine West and others in 2014 that allegedly rendered Jones Group insolvent. The matters in these proceedings were transferred from the United States District Court for the Northern District of Illinois to the United States District Court for the Southern District of New York to centralize the litigation, and were assigned to the Honorable Jed S. Rakoff for coordinated or consolidated pretrial proceedings. The FlexShares Morningstar US Market Factor Tilt Index Fund allegedly received $224,910 as a result of the Transactions. The Litigation Trustee and Indenture Trustee seek to clawback these proceeds for the benefit of the Trust and the noteholders, respectively, on the basis that they were alleged fraudulent conveyances. On June 29, 2020, the former public shareholder defendants, including FlexShares Morningstar US Market Factor Tilt Index Fund, filed a

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Notes to the Financial Statements (cont.)

------

motion to dismiss on the basis that the payments allegedly made to them in connection with the Transactions were shielded from the fraudulent conveyance claims under Section 546(e) of the Bankruptcy Code. On August 27, 2020, all fraudulent conveyance claims against the former public shareholder defendants were dismissed. Plaintiffs appealed from that decision and the actions are currently on appeal before the U.S. Court of Appeals for the Second Circuit. The Fund intends to continue to vigorously defend itself against this action.

**16. Coronavirus (COVID-19) Pandemic** 

------

The global outbreak of the coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may adversely impact the value and performance of the Funds, their ability to buy and sell fund investments at appropriate valuations, and their ability to achieve their investment objective(s).

**17. European Instability** 

------

Russia's military invasion of Ukraine in February 2022, the resulting responses by the United States and other countries, and the potential for wider conflict could increase volatility and uncertainty in the financial markets and adversely affect regional and global economies. The United States and other countries have imposed broad ranging economic sanctions on Russia and certain Russian individuals, banking entities and corporations as a response to Russia's invasion of Ukraine. The United States and other countries have also imposed economic sanctions on Belarus and may impose sanctions on other countries that support Russia's military invasion. These sanctions, as well as any other economic consequences related to the invasion or cyberattacks on governments, companies or individuals, have already decreased, and may further decrease, the value and liquidity of certain Russian securities and securities of issuers in other countries that are subject to economic sanctions related to the invasion. To the extent that a Fund has exposure to Russian or other Eastern European investments, the Fund's ability to price, buy, sell, receive or deliver such investments may be impaired. These and any related events could

significantly impact a Fund's performance and the value of an investment in the Fund, even beyond any direct exposure the Fund may have to Russian issuers or adjoining geographic regions. Funds that track an Index (an Index Fund) may experience challenges liquidating positions in Russian securities that have been removed from its underlying index and/or sampling the underlying index to continue to seek the Index Fund's respective investment goal. Such circumstances may lead to increased tracking error between an Index Fund's performance and the performance of its respective underlying index.

**18. Subsequent Events** 

------

Management has evaluated subsequent events for the Funds through the date the financial statements were issued, and has concluded that there are no recognized or non-recognized subsequent events relevant for financial statement disclosure, other than that effective January 3, 2023, the name of the FlexShares® Ready Access Variable Income Fund will change to FlexShares® Ultra-Short Income Fund.

532 FLEXSHARES ANNUAL REPORT

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## Report of Independent Registered Public Accounting Firm

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**To the Shareholders and Board of Trustees of FlexShares<sup>®</sup> Trust** 

**Opinion on the Financial Statements and Financial Highlights** 

We have audited the accompanying statements of assets and liabilities of FlexShares<sup>®</sup> Trust, comprising the funds listed in the table below (collectively, the "Funds"), including the schedules of investments, as of October 31, 2022, the related statements of operations, the statements of changes in net assets, and the financial highlights for each of the periods listed in the table below, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of each of the funds constituting FlexShares<sup>®</sup> Trust as of October 31, 2022, and the results of their operations, the changes in their net assets, and the financial highlights for each of the periods listed in the table below in conformity with accounting principles generally accepted in the United States of America.

---

| | | | |
|:---|:---|:---|:---|
| Fund Name | Statement of<br>Operations | Statements of<br>Changes in<br>Net Assets | Financial Highlights |
| FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund<br> FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund<br> FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund<br> FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund<br> FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund<br> FlexShares<sup>®</sup> Global Quality Real Estate Index Fund<br> FlexShares<sup>®</sup> Quality Dividend Index Fund<br> FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund<br> FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund<br> FlexShares<sup>®</sup> International Quality Dividend Index Fund<br> FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund<br> FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund<br> FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund<br> FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund<br> FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund<br> FlexShares<sup>®</sup> Ready Access Variable Income Fund<br> FlexShares<sup>®</sup> US Quality Large Cap Index Fund<br> FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund<br> FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund<br> FlexShares<sup>®</sup> Real Assets Allocation Index Fund<br> FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund<br> FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund<br> FlexShares<sup>®</sup> Core Select Bond Fund | For the year ended October 31, 2022 | For the years ended October 31, 2022 and 2021 | For the years ended October 31, 2022, 2021, 2020, 2019, and 2018 |
| FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund | For the year ended October 31, 2022 | For the years ended October 31, 2022 and 2021 | For the years ended October 31, 2022, 2021, 2020, 2019 and for the period from July 17, 2018 (commencement of operations) through October 31, 2018 |

---

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Report of Independent Registered Public Accounting Firm (cont.)

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---

| | | | |
|:---|:---|:---|:---|
| Fund Name | Statement of<br>Operations | Statements of<br>Changes in<br>Net Assets | Financial Highlights |
| FlexShares<sup>®</sup> US Quality Low Volatility Index Fund<br> FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund<br> FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund | For the year ended October 31, 2022 | For the years ended October 31, 2022 and 2021 | For the years ended October 31, 2022, 2021, 2020 and for the period from July 15, 2019 (commencement of operations) through October 31, 2019 |
| FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund<br> FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund<br> FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund<br> FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund | For the year ended October 31, 2022 | For the year ended October 31, 2022 and for the period from September 20, 2021 (commencement of operations) through October 31, 2021 | For the year ended October 31, 2022, and for the period from September 20, 2021 (commencement of operations) through October 31, 2021 |
| FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund | For the period from April 20, 2022 (commencement of operations) through October 31, 2022 | For the period from April 20, 2022 (commencement of operations) through October 31, 2022 | For the period from April 20, 2022 (commencement of operations) through October 31, 2022 |

---

**Basis for Opinion** 

These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on the Funds' financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds' internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of October 31, 2022, by correspondence with the custodian and brokers; when replies

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Report of Independent Registered Public Accounting Firm (cont.)

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were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/ DELOITTE & TOUCHE LLP

Chicago, Illinois

December 27, 2022

We have served as the auditor of one or more Northern Trust investment companies since 2002.

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## Tax Information October 31, 2022 (Unaudited)

------

**QUALIFIED DIVIDEND INCOME (QDI)** 

------

Under the Jobs and Growth Tax Relief Reconciliation Act of 2003 (the "Act"), the following percentages of ordinary dividends paid during the fiscal year ended October 31, 2021 are designated as "qualified dividend income", as defined in the Act, subject to reduced tax rates in 2021:

---

| | |
|:---|:---|
| Fund | QDI<br> PERCENTAGE |
| FlexShares US Quality Low Volatility Index Fund | 100.00% |
| FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | 80.41 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 46.58 |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 82.02 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 54.03 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 44.47 |
| FlexShares US Quality Large Cap Index Fund | 100.00 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 100.00 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 100.00 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 100.00 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 100.00 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 73.10 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 83.41 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 74.40 |
| FlexShares Global Quality Real Estate Index Fund | 12.96 |
| FlexShares Real Assets Allocation Index Fund | 63.21 |
| FlexShares Quality Dividend Index Fund | 86.91 |
| FlexShares Quality Dividend Defensive Index Fund | 88.85 |

---

---

| | |
|:---|:---|
| Fund | QDI<br> PERCENTAGE |
| FlexShares Quality Dividend Dynamic Index Fund | 97.22% |
| FlexShares International Quality Dividend Index Fund | 63.38 |
| FlexShares International Quality Dividend Defensive Index Fund | 60.01 |
| FlexShares International Quality Dividend Dynamic Index Fund | 69.10 |

---

**CORPORATE DIVIDENDS RECEIVED DEDUCTION (DRD)** 

------

A percentage of the dividends distributed during the fiscal year for the following Funds qualifies for the dividends received deduction for corporate shareholders:

---

| | |
|:---|:---|
| Fund | CORPORATE<br>DRD<br>PERCENTAGE |
| FlexShares US Quality Low Volatility Index Fund | 100.00% |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 0.19 |
| FlexShares Morningstar US Market Factor Tilt Index Fund | 78.90 |
| FlexShares US Quality Large Cap Index Fund | 100.00 |
| FlexShares STOXX<sup>®</sup> US ESG Select Index Fund | 100.00 |
| FlexShares STOXX<sup>®</sup> Global ESG Select Index Fund | 42.55 |
| FlexShares ESG & Climate US Large Cap Core Index Fund | 100.00 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 0.33 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 21.05 |
| FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund | 38.05 |
| FlexShares Global Quality Real Estate Index Fund | 0.39 |
| FlexShares Real Assets Allocation Index Fund | 23.42 |
| FlexShares Quality Dividend Index Fund | 83.48 |

---

536 FLEXSHARES ANNUAL REPORT

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Tax Information October 31, 2022 (Unaudited) (cont.)

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---

| | |
|:---|:---|
| Fund | CORPORATE<br>DRD<br>PERCENTAGE |
| FlexShares Quality Dividend Defensive Index Fund | 87.16% |
| FlexShares Quality Dividend Dynamic Index Fund | 92.32 |
| FlexShares International Quality Dividend Dynamic Index Fund | 0.01 |

---

**FOREIGN TAX CREDIT** 

------

Each Fund below intends to make an election that will allow its shareholders to treat their proportionate share of foreign taxes paid by the Fund as having been paid by them. The amounts per share, which represent income from sources within, and taxes paid to foreign countries, are as follows:

---

| | | |
|:---|:---|:---|
| Fund | TAXES | INCOME |
| FlexShares Developed Markets Ex-US Quality Low Volatility Index Fund | $0.0723 | $0.7075 |
| FlexShares Emerging Markets Quality Low Volatility Index Fund | 0.2001 | 0.9610 |
| FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund | 0.1674 | 2.1646 |
| FlexShares Morningstar Emerging Markets Factor Tilt Index Fund | 0.2610 | 2.0876 |
| FlexShares ESG & Climate Developed Markets ex-US Core Index Fund | 0.1292 | 1.0981 |
| FlexShares ESG & Climate Emerging Markets Core Index Fund | 0.1132 | 0.8755 |
| FlexShares Morningstar Global Upstream Natural Resources Index Fund | 0.0483 | 1.5874 |
| FlexShares STOXX Global Broad Infrastructure Index Fund | 0.0640 | 0.7959 |
| FlexShares Real Assets Allocation Index Fund | 0.0299 | 0.5079 |
| FlexShares International Quality Dividend Index Fund | 0.1012 | 1.3201 |
| FlexShares International Quality Dividend Defensive Index Fund | 0.0978 | 1.3473 |
| FlexShares International Quality Dividend Dynamic Index Fund | 0.1307 | 1.5566 |

---

FLEXSHARES ANNUAL REPORT 537

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## Fund Expenses (Unaudited)

------

As a shareholder, you incur two types of costs:

(1) Transaction costs for purchasing and selling shares and (2) ongoing costs, including advisory and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.

**Actual Expenses** 

------

The actual expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended October 31, 2022.

The first line under each Fund in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading "Expenses Paid During the Period" to estimate the expenses you paid on your account during this period.

**Hypothetical Example for Comparison Purposes** 

------

The hypothetical expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended October 31, 2022.

The second line under each Fund in the following table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as brokerage commissions on purchases or sales of Fund shares. Therefore, the second line for each Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Beginning<br>Account<br>Value | Ending<br>Account<br>Value<br>10/31/22 | Expenses Paid<br>During the<br>Period\* | Annualized<br> Expense Ratio<br>During Period |
| **FlexShares<sup>®</sup> US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> US Quality Low Volatility Index Fund** |
| Actual | $1000.00 | $968.00 | $1.09 | 0.22% |
| Hypothetical | $1000.00 | $1024.10 | $1.12 | 0.22% |
| **FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund** |
| Actual | $1000.00 | $878.60 | $1.52 | 0.32% |
| Hypothetical | $1000.00 | $1023.59 | $1.63 | 0.32% |
| **FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund** | **FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund** |
| Actual | $1000.00 | $841.20 | $1.86 | 0.40% |
| Hypothetical | $1000.00 | $1023.19 | $2.04 | 0.40% |

---

538 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Fund Expenses (cont.)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Beginning<br>Account<br>Value | Ending<br>Account<br>Value<br>10/31/22 | Expenses Paid<br>During the<br>Period\* | Annualized<br> Expense Ratio<br>During Period |
| **FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund** |
| Actual | $1000.00 | $956.30 | $1.23 | 0.25% |
| Hypothetical | $1000.00 | $1023.95 | $1.28 | 0.25% |
| **FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund** |
| Actual | $1000.00 | $866.90 | $1.84 | 0.39% |
| Hypothetical | $1000.00 | $1023.24 | $1.99 | 0.39% |
| **FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund** | **FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund** |
| Actual | $1000.00 | $808.90 | $2.69 | 0.59% |
| Hypothetical | $1000.00 | $1022.23 | $3.01 | 0.59% |
| **FlexShares<sup>®</sup> US Quality Large Cap Index Fund** | **FlexShares<sup>®</sup> US Quality Large Cap Index Fund** | **FlexShares<sup>®</sup> US Quality Large Cap Index Fund** | **FlexShares<sup>®</sup> US Quality Large Cap Index Fund** | **FlexShares<sup>®</sup> US Quality Large Cap Index Fund** |
| Actual | $1000.00 | $948.30 | $1.38 | 0.28% |
| Hypothetical | $1000.00 | $1023.79 | $1.43 | 0.28% |
| **FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund** |
| Actual | $1000.00 | $943.60 | $1.57 | 0.32% |
| Hypothetical | $1000.00 | $1023.59 | $1.63 | 0.32% |
| **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund** |
| Actual | $1000.00 | $908.70 | $2.02 | 0.42% |
| Hypothetical | $1000.00 | $1023.09 | $2.14 | 0.42% |
| **FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund** |
| Actual | $1000.00 | $938.70 | $0.44 | 0.09% |
| Hypothetical | $1000.00 | $1024.75 | $0.46 | 0.09% |
| **FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund** |
| Actual | $1000.00 | $863.40 | $0.56 | 0.12% |
| Hypothetical | $1000.00 | $1024.60 | $0.61 | 0.12% |
| **FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund** |
| Actual | $1000.00 | $800.80 | $0.82 | 0.18% |
| Hypothetical | $1000.00 | $1024.30 | $0.92 | 0.18% |
| **FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund** | **FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund** |
| Actual | $1000.00 | $946.40 | $2.26 | 0.46% |
| Hypothetical | $1000.00 | $1022.89 | $2.35 | 0.46% |
| **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** | **FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund** |
| Actual | $1000.00 | $898.60 | $2.25 | 0.47% |
| Hypothetical | $1000.00 | $1022.84 | $2.40 | 0.47% |

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FLEXSHARES ANNUAL REPORT 539

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##### [**Table of Contents**](#toc)

------

Fund Expenses (cont.)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Beginning<br>Account<br>Value | Ending<br>Account<br>Value<br>10/31/22 | Expenses Paid<br>During the<br>Period\* | Annualized<br> Expense Ratio<br>During Period |
| **FlexShares<sup>®</sup> Global Quality Real Estate Index Fund** | **FlexShares<sup>®</sup> Global Quality Real Estate Index Fund** | **FlexShares<sup>®</sup> Global Quality Real Estate Index Fund** | **FlexShares<sup>®</sup> Global Quality Real Estate Index Fund** | **FlexShares<sup>®</sup> Global Quality Real Estate Index Fund** |
| Actual | $1000.00 | $796.20 | $2.04 | 0.45% |
| Hypothetical | $1000.00 | $1022.94 | $2.29 | 0.45% |
| **FlexShares<sup>®</sup> Real Assets Allocation Index Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Real Assets Allocation Index Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Real Assets Allocation Index Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Real Assets Allocation Index Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Real Assets Allocation Index Fund<sup>(a)</sup>** |
| Actual | $1000.00 | $886.60 | $0.52 | 0.11% |
| Hypothetical | $1000.00 | $1024.65 | $0.56 | 0.11% |
| **FlexShares<sup>®</sup> Quality Dividend Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Index Fund** |
| Actual | $1000.00 | $948.50 | $1.82 | 0.37% |
| Hypothetical | $1000.00 | $1023.34 | $1.89 | 0.37% |
| **FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund** |
| Actual | $1000.00 | $960.10 | $1.83 | 0.37% |
| Hypothetical | $1000.00 | $1023.34 | $1.89 | 0.37% |
| **FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund** |
| Actual | $1000.00 | $952.40 | $1.82 | 0.37% |
| Hypothetical | $1000.00 | $1023.34 | $1.89 | 0.37% |
| **FlexShares<sup>®</sup> International Quality Dividend Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Index Fund** |
| Actual | $1000.00 | $843.10 | $2.18 | 0.47% |
| Hypothetical | $1000.00 | $1022.84 | $2.40 | 0.47% |
| **FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund** |
| Actual | $1000.00 | $846.50 | $2.19 | 0.47% |
| Hypothetical | $1000.00 | $1022.84 | $2.40 | 0.47% |
| **FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund** | **FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund** |
| Actual | $1000.00 | $831.50 | $2.17 | 0.47% |
| Hypothetical | $1000.00 | $1022.84 | $2.40 | 0.47% |
| **FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund** |
| Actual | $1000.00 | $961.10 | $0.89 | 0.18% |
| Hypothetical | $1000.00 | $1024.30 | $0.92 | 0.18% |
| **FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund** | **FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund** |
| Actual | $1000.00 | $935.20 | $0.88 | 0.18% |
| Hypothetical | $1000.00 | $1024.30 | $0.92 | 0.18% |
| **FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund** | **FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund** | **FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund** | **FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund** | **FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund** |
| Actual | $1000.00 | $950.20 | $0.98 | 0.20% |
| Hypothetical | $1000.00 | $1024.20 | $1.02 | 0.20% |

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540 FLEXSHARES ANNUAL REPORT

------

##### [**Table of Contents**](#toc)

------

Fund Expenses (cont.)

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---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Beginning<br>Account<br>Value | Ending<br>Account<br>Value<br>10/31/22 | Expenses Paid<br>During the<br>Period\* | Annualized<br> Expense Ratio<br>During Period |
| **FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund** |
| Actual | $1000.00 | $949.40 | $1.08 | 0.22% |
| Hypothetical | $1000.00 | $1024.10 | $1.12 | 0.22% |
| **FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund** | **FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund** |
| Actual | $1000.00 | $858.20 | $1.03 | 0.22% |
| Hypothetical | $1000.00 | $1024.10 | $1.12 | 0.22% |
| **FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund** | **FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund** | **FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund** | **FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund** | **FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund** |
| Actual | $1000.00 | $937.40 | $1.81 | 0.37% |
| Hypothetical | $1000.00 | $1023.34 | $1.89 | 0.37% |
| **FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund** |
| Actual | $1000.00 | $947.00 | $1.13 | 0.23% |
| Hypothetical | $1000.00 | $1024.05 | $1.17 | 0.23% |
| **FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund** | **FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund** |
| Actual | $1000.00 | $918.20 | $0.58 | 0.12% |
| Hypothetical | $1000.00 | $1024.60 | $0.61 | 0.12% |
| **FlexShares<sup>®</sup> Ready Access Variable Income Fund** | **FlexShares<sup>®</sup> Ready Access Variable Income Fund** | **FlexShares<sup>®</sup> Ready Access Variable Income Fund** | **FlexShares<sup>®</sup> Ready Access Variable Income Fund** | **FlexShares<sup>®</sup> Ready Access Variable Income Fund** |
| Actual | $1000.00 | $1002.20 | $1.26 | 0.25% |
| Hypothetical | $1000.00 | $1023.95 | $1.28 | 0.25% |
| **FlexShares<sup>®</sup> Core Select Bond Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Core Select Bond Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Core Select Bond Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Core Select Bond Fund<sup>(a)</sup>** | **FlexShares<sup>®</sup> Core Select Bond Fund<sup>(a)</sup>** |
| Actual | $1000.00 | $932.50 | $1.07 | 0.22% |
| Hypothetical | $1000.00 | $1024.10 | $1.12 | 0.22% |

---

*\** *Expenses are equal to the average account value over the period multiplied by the Fund's annualized expense ratio, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year (to reflect the one half year period).* 

*(a)* *Annualized expense ratio and expenses paid during the period do not include fees and expenses of the Underlying Fund(s) in which the Fund invests.* 

FLEXSHARES ANNUAL REPORT 541

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##### [**Table of Contents**](#toc)

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## Trustees and Officers (Unaudited)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **NON-INTERESTED TRUSTEES** | **NON-INTERESTED TRUSTEES** | **NON-INTERESTED TRUSTEES** | **NON-INTERESTED TRUSTEES** | **NON-INTERESTED TRUSTEES** | **NON-INTERESTED TRUSTEES** |
| Name, Address<sup>(1)</sup> and Age | Position(s)<br>Held with<br>the Trust | Term of<br> Office and<br> Length of<br>Time Served<sup>(2)</sup> | Principal Occupation(s) During<br>Past 5 Years | Number of<br> Funds<br> in Fund<br>Complex<sup>(3)</sup><br> Overseen<br> by Trustee | Other<br>Directorships<br>Held by<br> Trustee<sup>(4)</sup> |
| **Sarah N. Garvey**<br> Age: 70 | Trustee | July 2011<br>to present | • Chairman of the Board of Navy Pier from 2011 to 2013 and Member of the Board from 2011 to 2020;<br> • Member of the Board of Directors of The Civic Federation since 2004;<br> • Member of the Executive Committee and Chairman of the Audit Committee since 2017 and Trustee of the Art Institute of Chicago since 2011. | 32 |  |
| **Philip G. Hubbard**<br> Age: 71 | Trustee | July 2011<br>to present | • Managing Partner of Solidian Fund, LP and Solidian Management, LLC (a fund of hedge funds platform for family and friends investments) since 2001;<br> • President of Hubbard Management Group, LLC (a personal investment vehicle) since 2001;<br> • Chairman of the Board of Trustees of the Wheaton College Trust Company, N. A. since 2004;<br> • Member of the Board of Trustees of Wheaton College since 1998;<br> • Chairman of the Board of Directors of the English Language Institute/China (a nonprofit educational organization) since 1993;<br> • Member of the Board of First Cup, LLC (restaurant franchising) since 2014. | 32 |  |

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542 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Trustees and Officers (cont.)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Name, Address<sup>(1)</sup> and Age | Position(s)<br>Held with<br>the Trust | Term of<br> Office and<br> Length of<br>Time<br>Served<sup>(2)</sup> | Principal Occupation(s) During<br>Past 5 Years | Number of<br> Funds<br> in Fund<br>Complex<sup>(3)</sup><br> Overseen<br> by Trustee | Other<br>Directorships<br>Held by<br> Trustee<sup>(4)</sup> |
| **Eric T. McKissack**<br> Age: 68 | Trustee and Chairman | July 2011<br>to present | • CEO Emeritus and Founder; CEO and Founder from 2004 to 2020 of Channing Capital Management, LLC (an SEC registered investment adviser);<br> • Member of the Board of Trustees, the Investment Committee, and the Finance Committee of the Art Institute of Chicago since 2002;<br> • Member of the Board of Grand Victoria Foundation since 2011;<br> • Member of the Board of the Graham Foundation since 2014.<br> • Member of the Board of the Terra Foundation since 2021. | 32 | Morgan Stanley Pathway Funds (formerly, Consulting Group Capital Markets Funds) (11 Portfolios) Since April 2013. Farmer Mac (NYSE: AGM) since February 2021. |
| **INTERESTED TRUSTEE** |  |  |  |  |  |
| **Darek Wojnar <sup>(5)</sup>** <br> Age: 57 | Trustee | December<br>2018 to<br>present | • Director and Executive Vice President, Head of Funds and Managed Accounts, Northern Trust Investments Inc. since 2018;<br> • Managing Member of the Wojnar Group LLC (a publishing industry consulting company) since 2013;<br> • Head of Exchange-Traded Funds at Hartford Funds from2016 to 2017 and Managing Director of Lattice Strategies LLC from 2014 to 2016;<br> • Managing Director and Head of US iShares Product at BlackRock (including Barclays Global Investors acquired by BlackRock) from 2005 to 2013 and the Equity Long/Short Opportunities Fund (formerly, NT Equity Long/Short Strategies Fund) from 2011 to 2019. | 32 | Northern Funds (43 Portfolios) since January 1, 2019 and Northern Institutional Funds (6 Portfolios) since January 1, 2019 |

---

*<sup>(1)</sup>* *Each Non-Interested Trustee may be contacted by writing to the Trustee, c/o Paulita Pike, Ropes & Gray LLP, 191 North Wacker Drive, 32nd Floor, Chicago, IL 60606. Mr. Wojnar may be contacted by writing to him at 50 S. LaSalle St., Chicago, IL 60603.* 

*<sup>(2)</sup>* *Each Trustee will hold office for an indefinite term until the earliest of: (i) the next meeting of shareholders, if any, called for the purpose of considering the election or re-election of such Trustee and until the election and qualification of his or her successor, if any, elected at such meeting; or (ii) the date a Trustee resigns or retires, or a Trustee is removed by the Board or shareholders, in accordance with the Trust's Agreement and Declaration of Trust.* 

*<sup>(3)</sup>* *The "Fund Complex" consists of the Trust.* 

*<sup>(4)</sup>* *This column includes only directorships of companies required to report to the SEC under the Securities Exchange Act of 1934, as amended (i.e., public companies) or other investment companies registered under the 1940 Act.* 

*<sup>(5)</sup>* *An "interested person," as defined by the 1940 Act. Mr. Wojnar is deemed to be an "interested" Trustee because he is an officer of NTI and its parent company.* 

The Statement of Additional Information ("SAI") includes additional information about the Trust's Trustees and is available, without charge, upon request by contacting the Fund directly at (855) 933-6287.

FLEXSHARES ANNUAL REPORT 543

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##### [**Table of Contents**](#toc)

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Trustees and Officers (cont.)

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| | | | |
|:---|:---|:---|:---|
| **OFFICERS** | **OFFICERS** | **OFFICERS** | **OFFICERS** |
| Name, Address and Age | Position(s)<br>Held with<br>the Trust | Term of<br>Office<sup>(1)</sup> and<br>Length of<br> Time Served | Principal Occupation(s) During Past 5 Years |
| **Darlene Chappell**<br> Age: 59<br> 50 South LaSalle Street Chicago, IL 60603 | Anti-Money Laundering Officer | July 2011<br> to present | Anti-Money Laundering Compliance Officer for Northern Trust Investments, Inc., Northern Trust Securities,Inc., Northern Funds, Northern Institutional Funds,and Alpha Core Strategies Fund since 2009, Equity Long/Short Opportunities Fund (formerly NT Equity Long/ Short Strategies Fund) from 2011 to 2019 and 50 South Capital Advisors, LLC since 2015 and Belvedere Advisors LLC since 2019; Vice President and Compliance Consultant for The Northern Trust Company since 2006. |
| **Susan W. Yee**<br> Age: 52<br> 70 Fargo Street, Boston, MA 02110 | Assistant Secretary | October<br> 2014<br> to present | Vice President, Regulatory Services Group, J.P. Morgan Chase Bank, N.A. since 1994, in various positions. |
| **Jose J. Del Real, Esq.**<br> Age: 44<br> 50 South LaSalle Street Chicago, IL 60603 | Secretary | December<br> 2018<br> to present | Senior Legal Counsel and Senior Vice President, Asset Management Practice Group of the Legal Department of The Northern Trust Company since March 2017; Senior Legal Counsel and Vice President, Asset Management Practice Group of the Legal Department of The Northern Trust Company from August 2015 to March 2017; Assistant Secretary of Northern Trust Investments, Inc. since 2016; Secretary of Northern Funds and Northern Institutional Funds since November 2018; Assistant Secretary of Northern Funds and Northern Institutional Funds from 2011 to 2014 and from May 2015 to November 2018; Assistant Secretary of FlexShares Trust from June 2015 to December 2018. |
| **Maya Teufel**<br> Age: 50<br> 50 South LaSalle Street Chicago, IL 60603 | Chief Compliance Officer | July 2019<br> to present | Chief Compliance Officer of FlexShares Trust since July 2019; Chief Compliance Officer of Northern Trust Investments, Inc. since July 2019; Co-Head of U.S. Regulatory Compliance Group of Goldman Sachs Asset Management, LP from September 2016 to June 2019; General Counsel and Chief Compliance Officer of Emerging Global Advisors, LLC from November 2013 to August 2016; and Vice President and Corporate Counsel of Jennison Associates LLC from July 2005 to November 2013. |
| **Randal E. Rein**<br> Age: 52<br> 50 South LaSalleStreet Chicago, IL 60603 | Treasurer and Principal Financial Officer | July 2011<br> to present | Senior Vice President of Northern Trust Investments, Inc. since 2010; Treasurer of Northern Funds and Northern Institutional Funds since 2008; Treasurer of Alpha Core Strategies Fund from 2008 to 2018; Treasurer of Equity Long/Short Opportunities Fund from 2011 to 2018. |
| **Peter K. Ewing**<br> Age: 63<br> 50 South LaSalle Street Chicago, IL 60603 | President | March 2017<br> to present | President of Northern Funds and Northern Institutional Funds and the Trust since March 2017; Vice President of the Trust from July 2011 to February 2017; Director of Product Management, ETFs & Mutual Funds, and Director of Northern Trust Investments, Inc. since March 2017; Senior Vice President of, The Northern Trust Company and Northern Trust Investments, Inc., since September 2010; Director of ETF Product Management of, Northern Trust Investments, Inc. from September 2010 to February 2017. |

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544 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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Trustees and Officers (cont.)

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| | | | |
|:---|:---|:---|:---|
| Name, Address and Age | Position(s)<br>Held with<br>the Trust | Term of<br>Office<sup>(1)</sup> and<br>Length of<br> Time Served | Principal Occupation(s) During Past 5 Years |
| **Craig R. Carberry, Esq.**<br> Age: 61<br> 50 South LaSalle Street Chicago, IL 60603 | Chief Legal Officer | June 2019<br> to present | Chief Legal Officer and Secretary of Northern Trust Investments, Inc. since May 2000; Chief Compliance Officer of Northern Trust Investments, Inc. from October 2015 to June 2017; Chief Legal Officer and Secretary of 50 South Capital Advisors, LLC since 2015; Chief Legal Officer and Secretary of Belvedere Advisors LLC since September 2019; Deputy General Counsel and Senior Vice President at The Northern Trust Company since June 2020; Secretary of Alpha Core Strategies Fund (formerly NT Alpha Strategies Fund) since 2004; Secretary of Equity Long/Short Opportunities Fund (formerly NT Equity Long/Short Strategies Fund) from 2011-2109; Secretary of Northern Institutional Funds and Northern Funds from 2010-2018; Secretary of FlexShares Trust from 2011-2018; Chief Legal Officer and Secretary of Northern Trust Securities, Inc. since October 2020. |
| **Christopher P. Fair**<br> Age: 40<br> 50 South LaSalle Street Chicago, IL 60603 | Vice President | June 2019<br> to present | Vice President, The Northern Trust Company since March 2020; ETF Services Manager, Northern Trust Investments, Inc. since June 2019; Second Vice President, The Northern Trust Company from November 2015 to March 2020; ETF Product Manager, Northern Trust Investments, Inc. from November 2015 to June 2019; Fund Administration Supervisor, Calamos Investments LLC from February 2015 to November 2015; Senior Mutual Fund Accountant, Calamos Investments LLC from February 2009 to January 2015. |
| **Himanshu S. Surti**<br> Age: 47<br> 50 South LaSalle Street Chicago, IL 60603 | Vice President | December<br> 2020<br> to present | Senior ETF Product Manager, Northern Trust Investments, Inc. since November 2020; Senior Vice President, The Northern Trust Company since November 2020; Portfolio Manager and Chief Operating Officer, Cambria Investment Management from June 2014 to November 2020; Vice President, Cambria ETF Trust from March 2018 to November 2020. |

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*<sup>(1)</sup>* *Officers hold office at the pleasure of the Board until their successors are duly elected and qualified, or until their death, resignation, or disqualification.* 

FLEXSHARES ANNUAL REPORT 545

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## Approval of Advisory Agreement (Unaudited)

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The Board of Trustees (the "Board") of the FlexShares Trust (the "Trust") oversees the management of the Trust and each separate series of the Trust covered in this report (each, a "Fund" and, collectively, the "Funds") and, as required by law, determines whether to approve the Trust's investment advisory and ancillary services agreement (the "Advisory Agreement") with Northern Trust Investments, Inc. (the "Adviser"), an indirect subsidiary of the Northern Trust Corporation.

\* \* \* \* \*

At a meeting on June 23, 2022 (the "June Meeting"), the Board, including all of the Trustees who are not parties to the Advisory Agreement or interested persons of any such party (the "Independent Trustees"), considered whether to approve the continuation of the Advisory Agreement between the Adviser and the Trust, on behalf of each Fund.

In advance of, and in preparation for, the Trustees' consideration of the Advisory Agreement at the June Meeting, the Trustees received written materials relating to the Advisory Agreement and had the opportunity to ask questions and request further information in connection with their consideration. At the June Meeting, the Trustees considered the Adviser's presentations and discussed all of the information that had been provided. Among other things, the Board considered comparisons with other funds in relevant peer universes and peer groups that had been determined by Broadridge Financial Solutions, Inc. ("Broadridge"), an independent provider of fund data, which included, among other things, the following information: (1) a description of the types of funds chosen by Broadridge to compare to each Fund; (2) comparative performance data for each Fund; (3) data on each Fund's expenses and fees; and (4) comparative fee data for each Fund's respective peer group, including comparisons of advisory fees and total expense ratios. In considering the Advisory Agreement, the Independent Trustees met with their independent legal counsel separately from the "interested" Trustee of the Trust and officers and employees of the Adviser. After evaluating all the materials, the Trustees, including the Independent Trustees, concluded that the Advisory Agreement was in the best interest of each of the

Funds and their shareholders and approved the continuation of the Advisory Agreement on behalf of the Funds.

The material factors and conclusions that formed the basis for the Trustees reaching their determination to approve the continuation of the Advisory Agreement are separately discussed below.

**Nature, Quality and Extent of Services** 

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The Board examined the nature, quality and extent of the services provided by the Adviser to each Fund. The Board also considered the Adviser's responsibilities under the Advisory Agreement to perform securities trading services and ancillary services including, among other things: (i) filing reports with the SEC, (ii) periodically updating the Trust's registration statement, (iii) establishing and maintaining the Funds' website to comply with regulatory requirements, (iv) monitoring anticipated purchases and redemptions of creation units by shareholders and new investors, (v) providing information and assistance as required by the Trust's administrator and fund accountant in connection with the Trust's shares, and (vi) providing assistance in connection with the operations of the Trust generally.

The Board also considered the quality of the Adviser's resources that are made available to the Trust. The Board noted the Adviser's and its affiliates' financial position, stability and commitment to growing their exchange-traded funds ("ETFs") business. The Board also considered the operation and strength of the Adviser's compliance program.

The Board noted that Foreside Fund Services, LLC, an entity unaffiliated with the Adviser, provides distribution services to the Funds and that JPMorgan Chase Bank, N.A., also an unaffiliated entity, provides custody, transfer agency, securities lending and fund administration support services, and that these service provider arrangements were relevant to the Board's considerations of the totality of the circumstances surrounding renewal of the Advisory Agreement. The Board concluded that each Fund benefited from the services provided under the Advisory Agreement and as a result of the Adviser's operations, resources, experience, reputation and personnel.

546 FLEXSHARES ANNUAL REPORT

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Approval of Advisory Agreement (cont.)

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**Performance, Fees and Expenses** 

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The Board considered that, unlike FlexShares<sup>®</sup> Ready Access Variable Income Fund and FlexShares<sup>®</sup> Core Select Bond Fund (each, an "Active Fund"), the investment objective of each Fund other than the Active Funds (each, an "Index Fund") is to seek investment results that correspond generally to the price and yield performance, before fees and expenses, of a specified index (each, an "Underlying Index"). The Board considered the Adviser's explanation that performance information with respect to funds in relevant peer universes and peer groups selected by Broadridge is only one of several comparative data points and that none of the peer funds sought to track an index that was the same as any Index Fund's Underlying Index. The Board considered the information that the Adviser provided regarding the difference between each Fund's performance, after fees and expenses, and the performance of its Underlying Index or benchmark index (as applicable) over certain periods of time, including as noted further below, ended March 31, 2022 (the "Tracking Difference"). The Board considered the Adviser's expectations for each Index Fund's Tracking Difference and noted the Adviser's view that all instances of Tracking Difference for the Index Funds reflect results well within appropriate expectations after taking into account (i) all of the factors that affect Tracking Difference and (ii) the ancillary objectives of minimizing portfolio transaction costs and tax-related inefficiencies.

The Board also considered comparative performance, fee and expense information of each Fund provided by Broadridge. The Broadridge comparisons ranked each Fund in various quintiles over certain periods of time, including as noted further below, ended March 31, 2022, with the first quintile being the lowest or best 20% of the funds in terms of fund cost and fund performance, respectively. The Board noted that, in certain cases, the Broadridge peer funds included funds sponsored by an "at cost" service provider and that there were limitations in providing comparable peer funds.

The Board considered that the Adviser contractually agreed to reimburse the portion of the operating expenses of each Fund until at least March 1, 2023, so that, after such reimbursement, the total annual fund operating expenses of

a Fund, excluding any acquired fund fees and expenses, expressed as a percentage of average daily net assets, does not exceed an amount equal to the sum of (i) the Fund's advisory fee rate and (ii) 0.0049% (the "Expense Reimbursement Agreement").

In reaching its determinations, the Board considered a large amount of data provided by the Adviser in response to a written request previously submitted by the Independent Trustees to the Adviser. Among the information considered by the Board was the following information:

<u>Index Funds:</u> 

<u>FlexShares<sup>®</sup> Morningstar US Market Factor Tilt Index Fund (TILT)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 20 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, number of holdings and approach to portfolio and trade construction.

The Board also considered that the Fund's performance was in the third quintile of its performance universe for the one-year, three-year and five-year periods and in the second quintile for the ten-year period.

The Board noted that the Fund's advisory fee net of waivers ("Net Advisory Fee") was one basis point higher than its expense group median and the Fund's contractual advisory fee ("Contractual Advisory Fee") and total expense ratio (which represents the total cost to investors) were equal to its expense group median.

<u>FlexShares<sup>®</sup> Morningstar Developed Markets ex-US Factor Tilt Index Fund (TLTD)</u> 

The Board considered that the Fund's performance, after fees and expenses, was above the performance of its Underlying Index for the one-year and three-year periods and differed from the performance of the Underlying Index by less than 10 basis points for the remaining periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, dividend-related

FLEXSHARES ANNUAL REPORT 547

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tax differentials, the use of futures, securities selection, compounding of tracking difference, transaction costs and number of holdings.

The Board also considered that the Fund's performance ranked in the first quintile of its performance universe for the five-year and since inception periods, the second quintile for the three-year period and the third quintile for the one-year period.

The Board took into account that the Fund's total expense ratio (which represents the total cost to investors) and Net Advisory Fee were higher than its expense group median while its Contractual Advisory Fee was lower than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> Morningstar Emerging Markets Factor Tilt Index Fund (TLTE)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 100 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, Indian capital gains tax accruals, the use of futures, transaction costs, securities selection, dividend tax differentials compounding of tracking difference and number of holdings.

The Board noted that the Fund's performance ranked in the first quintile of its performance universe for the one-year period and in the third quintile for the remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.15% of its expense group median.

<u>FlexShares<sup>®</sup> US Quality Large Cap Index Fund (QLC)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its

Underlying Index by less than 40 basis points for all periods. The Board considered the factors that influenced the Fund's

Tracking Difference including, among other things, compounding of tracking difference, transaction costs, the use of futures and securities selection.

The Board noted that the Fund's performance ranked in the first quintile of its performance universe for the one-year period, the fourth quintile for the three-year period and the fifth quintile for all remaining periods.

The Board and Adviser agreed to a contractual expense reduction in the management fee for the Fund from 0.32% to 0.25% per annum, with a corresponding reduction of the Adviser's expense limitation agreement with the Fund's trust.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund (ESG)</u> 

The Board considered that the Fund's performance, after fees and expenses, was above the performance of its Underlying Index for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including dividend-related tax differentials, the use of futures, compounding and securities selection.

The Board also considered that the Fund's performance ranked in the first or second quintile of its performance universe for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund (ESGG)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 5 basis points for the one-year, three-year and five-year periods and was roughly equal to the performance of its Underlying Index

548 FLEXSHARES ANNUAL REPORT

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for the since inception period. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, dividend-related tax differentials, securities selection, compounding, transaction costs and the use of futures.

The Board noted that the Fund's performance ranked in the first quintile of its performance universe for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> Morningstar Global Upstream Natural Resources Index Fund (GUNR)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 90 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, compounding, the use of futures, securities selection, transaction costs, Indian capital gains tax accruals and dividend tax differentials.

The Board also considered that the Fund's performance ranked in the fourth quintile of its performance universe for the one-year period, in the third quintile for the third-year period and in the first quintile for the remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors) was lower than its expense group median and its Contractual Advisory Fee and Net Advisory Fee were three and four basis points higher, respectively, than its expense group median.

<u>FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund (NFRA)</u> 

The Board considered that the Fund's performance, after fees and expenses, exceeded the performance of its Underlying Index for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, compounding, the use of futures, securities selection, transaction costs, Indian capital gains tax accruals and dividend tax differentials.

The Board considered that the Fund's performance ranked in the fifth quintile of its performance universe for the one-year period and in the fourth quintile for all remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> Global Quality Real Estate Index Fund (GQRE)</u> 

The Board considered that the Fund's performance, after fees and expenses, exceeded the performance of its Underlying Index for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, securities selection, dividend-related tax differentials, compounding, transaction costs and the use of futures.

The Board also considered that the Fund's performance ranked in the first quintile of its performance universe for the one-year period, in the second quintile for the since inception period and the fourth quintile for all remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors) was equal to its expense group median while its Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and considered this in light of the Fund's performance.

<u>FlexShares<sup>®</sup> Real Assets Allocation Index Fund (ASET)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 20 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of Tracking Difference during periods of market volatility and transaction costs.

The Board noted that the Fund's performance was in the fifth quintile of its performance universe for the one-year period, in the fourth quintile for the three-year period, and in the second quintile for the remaining periods.

FLEXSHARES ANNUAL REPORT 549

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Approval of Advisory Agreement (cont.)

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The Board considered that the Fund's total expense ratio (which represents the total cost to investors) was lower than its expense group median, its Net Advisory Fee was equal to its expense group median, and the Fund's Contractual Advisory Fee was higher than its expense group median. The Board noted that the Fund's Contractual Advisory Fee was within 0.07% of its expense group median Contractual Advisory Fee. The Board also considered that the Adviser had agreed to waive a portion of its advisory fee and/or reimburse operating expenses in an amount equal to any acquired fund fees and expenses incurred by the Fund that were attributable to its investment in other Funds.

<u>FlexShares<sup>®</sup> Quality Dividend Index Fund (QDF)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 60 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of Tracking Difference during periods of market volatility, transaction costs, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index, and stock selection.

The Board also considered that the Fund's performance ranked in the third quintile for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.

<u>FlexShares<sup>®</sup> Quality Dividend Defensive Index Fund (QDEF)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 60 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of Tracking Difference during periods of market volatility, transaction costs, stock selection, and the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index.

The Board considered that the Fund's performance ranked in the third or fourth quintile of its performance universe for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.

<u>FlexShares<sup>®</sup> Quality Dividend Dynamic Index Fund (QDYN)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 40 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, volatility-related compounding and stock selection as well as the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index.

The Board also considered that the Fund's performance ranked in the first or second quintile of its performance universe for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee, and Contractual Advisory Fee were equal to its expense group median.

<u>FlexShares<sup>®</sup> International Quality Dividend Index Fund (IQDF)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 40 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, volatility-related compounding, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index, stock selection, dividend tax differentials whereby the Fund may be eligible for different tax withholding and transaction costs.

The Board also considered that the Fund's performance ranked in the fifth quintile for the one-year period, the third quintile for the three-year and since inception periods and the fourth quintile for the remaining period.

550 FLEXSHARES ANNUAL REPORT

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The Board took into account that the Fund's total expense ratio (which represents the total cost to investors) and Contractual Advisory Fee were equal to its expense group median while its Net Advisory Fee was higher than its expense group median Net Advisory Fee. The Board noted that the Fund's Net Advisory Fee was within 0.01% of its expense group median Net Advisory Fee.

<u>FlexShares<sup>®</sup> International Quality Dividend Defensive Index Fund (IQDE)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by 50 basis points or less for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of Tracking Difference during periods of market volatility, differences in security-level weights relative to the Underlying Index which can be impacted by multiple factors including, but not limited to, pending corporate actions, round lot conventions, multiple share classes, transaction cost minimization, and security specific liquidity constraints, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index, trade related stamp taxes in certain foreign jurisdictions and accruals from India capital gains taxes that can differ from the Underlying Index.

The Board also considered that the Fund's performance ranked in the fourth quintile for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors) and Contractual Advisory Fee were equal to its expense group median while its Net Advisory Fee was higher than its expense group median Net Advisory Fee. The Board noted that the Fund's Net Advisory Fee was within 0.01% of its expense group median Net Advisory Fee.

<u>FlexShares<sup>®</sup> International Quality Dividend Dynamic Index Fund (IQDY)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 50 basis points for all periods. The Board considered the factors that influenced the Fund's

Tracking Difference including, among other things, the compounding effect of Tracking Difference during periods of market volatility, differences in security-level weights relative to the Underlying Index which can be impacted by multiple factors including, but not limited to, pending corporate actions, round lot conventions, multiple share classes, transaction cost minimization, and security specific liquidity constraints, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index, trade related stamp taxes in certain foreign jurisdictions and accruals from India capital gains taxes that can differ from the Underlying Index.

The Board also considered that the Fund's performance ranked in the fourth quintile of its performance universe for the one-year period and in the first or second quintile for the remaining periods.

The Board took into account that the Fund's total expense ratio (which represents the total cost to investors) and Contractual Advisory Fee were equal to its expense group median while its Net Advisory Fee was higher than its expense group median Net Advisory Fee. The Board noted that the Fund's Net Advisory Fee was within 0.01% of its expense group median Net Advisory Fee.

<u>FlexShares<sup>®</sup> iBoxx 3-Year Target Duration TIPS Index Fund (TDTT)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 20 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, pricing differences, security selection, and liquidity and trading costs.

The Board also considered that the Fund's performance ranked in the third or fourth quintile of its performance universe for all periods.

The Board took into account that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and the Fund's total expense ratio was within 0.07% of its expense group median.

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<u>FlexShares<sup>®</sup> iBoxx 5-Year Target Duration TIPS Index Fund (TDTF)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 25 basis points for all periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, pricing differences, security positioning, liquidity considerations and interest rates.

The Board also considered that the Fund's performance ranked in the third quintile of its performance universe for the one-year period and the second quintile for the remaining periods.

The Board took into account that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and the Fund's total expense ratio was within 0.07% of its expense group median.

<u>FlexShares<sup>®</sup> Disciplined Duration MBS Index Fund (MBSD)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 105 basis points for the one-year period and by less than 55 basis points for the remaining periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, pricing differences and liquidity and trading costs. The Board also considered that the Fund's Underlying Index generally achieves its target duration with fewer constituents than its peer indices, and that the Adviser utilizes a representative sampling strategy to manage the Fund.

The Board also considered that the Fund's performance ranked in the second quintile of its performance universe for the three-year period and in the fourth quintile for the remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors) and Net Advisory Fee were higher than its expense group median while the Fund's Contractual Advisory Fee was equal to its

expense group median Contractual Advisory Fee. The Board noted its total expense ratio was within 0.15% of its expense group median.

<u>FlexShares<sup>®</sup> Credit-Scored US Corporate Bond Index Fund (SKOR)</u> 

The Board considered the Fund's performance for the one-, three-, five-year and since inception periods. The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 20 basis points for the one-year period and exceeded the performance of its Underlying Index by more than 200 basis points for the since inception period. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, shifts in interest rates, liquidity and trading costs, and pricing differences.

The Board also considered that the Fund's performance ranked in the fourth quintile for all periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.08% of its expense group median. The Board considered this in the context of the Fund's performance against its Underlying Index.

<u>FlexShares<sup>®</sup> Credit-Scored US Long Corporate Bond Index Fund (LKOR)</u> 

The Board considered the Fund's performance for the one-, three-, five-year and since inception periods. The Board considered that the Fund's performance, after fees and expenses, differed from the performance of its Underlying Index by less than 15 basis points for the one-year period and exceeded the performance of its Underlying Index by more than 550 basis points for the since inception period. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, pricing differences, shifts in interest rates, liquidity and trading costs, and security selection. The Board also considered that the Adviser utilizes a representative sampling strategy to manage the Fund.

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The Board also considered that the Fund's performance ranked in the second quintile for the one-year period and the first quintile of its performance universe for the remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its Fund's total expense ratio was within 0.08% of its expense group median. The Board considered this in the context of the Fund's performance.

<u>FlexShares<sup>®</sup> High Yield Value-Scored Bond Index Fund (HYGV)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 75 basis points for the one-year period and less than 135 basis points for the remaining periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, liquidity and trading costs, shifts in interest rates, security selection and pricing differences.

The Board also considered that the Fund's performance ranked in the second quintile of its performance universe for the one-year period and in the first quintile for the remaining periods.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.03% of its expense group median.

<u>FlexShares<sup>®</sup> US Quality Low Volatility Index Fund (QLV)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 35 basis points for both the one-year and since inception periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of tracking error in periods of high volatility, the use of broad equity index futures used to equitize cash and accruals which can perform differently than the Fund's index, stock selection, and transaction costs.

The Board also considered that the Fund's performance ranked in the first quintile of its performance universe for the one-year period and the fourth quintile for the since inception period. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and its total expense ratio was within 0.03% of its expense group median.

<u>FlexShares<sup>®</sup> Developed Markets ex-US Quality Low Volatility Index Fund (QLVD)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by 30 basis points for both the one-year and since inception periods. The Board considered the factors that influenced the Fund's Tracking Difference including, among other things, the compounding effect of tracking error in periods of high volatility.

The Board also considered that the Fund's performance ranked in the first quintile of its performance universe for the one-year period and in the fifth quintile for the since inception period. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors) and Net Advisory Fee were higher than its expense group median, while its Contractual Advisory Fee was lower than its expense group median. The Board noted that the Fund's Net Advisory Fee was within 0.04% of its expense group median.

<u>FlexShares<sup>®</sup> Emerging Markets Quality Low Volatility Index Fund (QLVE)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 90 basis points for the one-year and since inception periods. The Board considered the factors that influenced

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the Fund's Tracking Difference including, among other things, rebalancing of the Underlying Index, the use of broad equity index futures to equitize cash and accruals, Indian capital gains tax accruals, transaction costs, dividend differential, and compounding of tracking difference.

The Board also considered that the Fund's performance ranked in the first quintile of its performance universe for the one-year period and in the fourth quintile for the since inception period. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.

<u>FlexShares<sup>®</sup> ESG & Climate Developed Markets ex-US Core Index Fund (FEDM)</u> 

The Board considered that the Fund's performance, after fees and expenses, exceeded its Underlying Index by more than 5 basis points since inception. The Board also considered that the Fund's performance ranked in the second quintile of its performance universe since inception. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.

<u>FlexShares<sup>®</sup> ESG & Climate US Large Cap Core Index Fund (FEUS)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 5 basis points since inception. The Board also considered that the Fund's performance ranked in the second quintile of its performance universe since inception. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.

<u>FlexShares<sup>®</sup> ESG & Climate Investment Grade Corporate Core Index Fund (FEIG)</u> 

The Board considered that the Fund's performance, after fees and expenses, exceeded its Underlying Index by more than 15 basis points since inception. The Board also considered that the Fund's performance ranked in the third quintile of its performance universe since inception. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.

<u>FlexShares<sup>®</sup> ESG & Climate High Yield Corporate Core Index Fund (FEHY)</u> 

The Board considered that the Fund's performance, after fees and expenses, differed from its Underlying Index by less than 30 basis points since inception. The Board also considered that the Fund's performance ranked in the fifth quintile of its performance universe since inception. Further, the Board considered the Fund's relatively short performance record and noted that it would be prudent to allow the Adviser more time to develop the Fund's performance record.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median.

<u>FlexShares<sup>®</sup> ESG & Climate Emerging Markets Core Index Fund (FEEM)</u> 

The Board considered the Fund's performance, as well as its fees and expenses, and noted that the Fund had recently launched on April 21, 2022. The Board determined that it would be prudent to allow the Adviser more time to develop the Fund.

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<u>Active Funds:</u> 

<u>FlexShares<sup>®</sup> Ready Access Variable Income Fund (RAVI)</u> 

The Board considered that the Fund's performance ranked in the first quintile for the five-year period, the fourth quintile for the one-year period and the second quintile for the remaining periods. The Board also considered that the Fund outperformed its benchmark index for the three- and five-year and since inception periods and underperformed its benchmark index for the one-year period. The Board also considered information provided by the Adviser with regard to the Fund's performance against certain peer funds identified by the Adviser. In this regard, the Board considered the Adviser's assertion that consistent with the Adviser's capital market assumptions, the Fund's portfolio composition has generally been characterized by longer duration and higher credit quality than certain peer funds.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were higher than its expense group median and the Fund's total expense ratio was within 0.06% of its expense group median.

<u>FlexShares<sup>®</sup> Core Select Bond Fund (BNDC)</u> 

The Board considered that the Fund's performance ranked in the third or fourth quintile of its performance universe for all periods. The Board also considered that the Fund underperformed its benchmark index for all periods. The Board also considered information provided by the Adviser with regard to the Fund's performance against certain peer funds identified by the Adviser. In this regard, the Board considered the Adviser's assertion that relative to such peers, the Fund has historically been overweight to treasury securities and investment grade corporate bonds and, as such, the peer funds have historically benefited during risk-on market environments through heavier allocations to securitized debt instruments and lower credit quality securities.

The Board considered that the Fund's total expense ratio (which represents the total cost to investors), Net Advisory Fee and Contractual Advisory Fee were lower than its expense group median. The Board also considered that the Adviser had agreed to waive a portion of its advisory fee

and/or reimburse operating expenses in an amount equal to any acquired fund fees and expenses incurred by the Fund that were attributable to its investment in other Funds.

***Costs of Services and Profits of the Adviser***

The Board considered the unitary fee structure and the expenses for each Fund and noted that, under the Advisory Agreement, the Adviser was responsible for most expenses of the Funds, including the cost of transfer agency, custody, fund administration, legal, audit and other services. The Board considered that the Adviser was not responsible under the Advisory Agreement for certain expenses, including the fees and expenses of the Trust's Independent Trustees and their independent legal counsel, litigation expenses and other extraordinary expenses.

The Board considered the advisory fee for each Fund as compared to that of other comparable funds in relation to its respective Broadridge median. The Board considered the Adviser's explanation that each Index Fund's advisory fee (both gross and net of waivers) compared favorably with its respective Broadridge median advisory fee (both gross and net of waivers) for comparable funds set forth in the Broadridge report, especially taking into account, among other factors, important differences between the indexes upon which such comparable funds are based and each Index Fund's Underlying Index, including in certain cases differences between the number of portfolio holdings for comparable funds and the Funds. The Board considered the advisory fee schedules for other accounts with similar investment advisory mandates as those of the Funds, noting that there were no comparable accounts for certain of the Funds. The Board considered (a) the differences in managing ETFs versus separately managed accounts which involve daily purchase and redemption activity along with robust regulatory and governance requirements; and (b) the Funds' unitary fee structure.

The Board examined the Adviser's profitability information provided by the Adviser, and the Trustees considered that the Adviser was profitable on a pre-distribution basis but not on a post-distribution basis. The Board considered that the Adviser's potential for profitability would continue to be subject to financial uncertainties and risks. The Board also

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considered that the Adviser would continue to develop and offer additional new products in efforts to complete the overall integrity of the Trust's product suite, consistent with its product strategy, and that these products may expose the Adviser to additional financial risks and uncertainties.

***Economies of Scale***

The Board considered whether the Adviser may realize economies of scale in managing and supporting the Funds. The Board reviewed each Fund's fee arrangements, which did not include breakpoints, and considered that, in light of the unitary fee structure, the Adviser's profitability from its services to the Trust and the significant investment that the Adviser had made and continues to make in the Trust, breakpoints were not necessary at this time. The Board also noted the Expense Reimbursement Agreement.

***Other Benefits to the Adviser***

In addition to considering the profits that may be realized by the Adviser, the Board considered information regarding other direct and indirect benefits the Adviser may receive as a result of its relationship with the Funds, including whether any compensation would be paid to its affiliates. The Board also considered that some of the Funds' shareholders have other client relationships with the Adviser or its affiliates. The Board also reviewed the extent to which the Adviser and its other clients, as well as the Funds, benefit from receipt of the research products and services generated by the Funds.

The Board, including the Independent Trustees, considered the data provided by the Adviser and concluded that sufficient information had been provided to allow them to evaluate the terms of the Advisory Agreement and each Fund's investment advisory fee. They determined that each Fund's advisory fee was reasonable in light of the services provided and the performance achieved by the Fund.

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## Supplemental Information (Unaudited)

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**Principal Risks** 

As with any investment, you could lose all or part of your investment in a Fund, and the Fund's performance could trail that of other investments. In addition to the discussion of the risks of certain of the Funds' investments included in Note 2, some of the principal risks of investment in the Funds are summarized below. A more complete description of principal risks is included in each Fund's Prospectus.

The following risks apply to all of the Funds:

**Derivatives Risk** 

Changes in the value of a derivative instrument may not correlate perfectly with the underlying asset, rate or index, and the Funds could lose more than the principal amount invested. Derivatives are also subject to counterparty risk, which is the risk that the other party to the transaction will not perform its contractual obligations. The use of derivatives is a highly specialized activity that involves investment techniques and risks different from those associated with investments in more traditional securities and instruments.

**Market Trading Risk** 

Each Fund is subject to risks resulting from its shares being listed on a securities exchange, including the potential lack of an active market for Fund shares, losses from trading in secondary markets, periods of high volatility and disruption in the creation/redemption process of the Fund. Any of these factors may lead to the Funds' shares trading at a premium or discount to NAV.

**Authorized Participant Concentration Risk** 

Only an Authorized Participant may engage in creation or redemption transactions directly with the Funds. The Funds have a limited number of institutions that act as Authorized Participants. To the extent that these institutions exit the business or are unable or unwilling to proceed with creation and/or redemption orders with respect to the Funds and no other Authorized Participant is able or willing to step forward to create or redeem Creation Units, Fund shares may trade at a discount to NAV and possibly face trading halts and/or delisting. This risk may be heightened for a Fund if it invests in non-U.S. securities or other securities or instruments that are less widely traded. Such securities or instruments often involve greater settlement and operational issues and capital costs for Authorized Participants.

**Securities Lending Risk** 

Securities lending risk is the risk that a Fund may lose money because the borrower of the loaned securities fails to return the securities in a timely manner or at all. A Fund could also lose money in the event of a decline in the value of collateral provided for loaned securities or a decline in the value of any investments made with cash collateral.

**Market Risk** 

Market risk is the risk that general market conditions, such as real or perceived adverse economic or political or financial events in the U.S. or global markets. The frequency and magnitude of such changes in value cannot be predicted. Certain securities and other investments held by a Fund may experience increased volatility, illiquidity, or other potentially adverse effects in response to changing market conditions, inflation, changes in interest rates, lack of liquidity in the bond or equity markets, volatility in the equities market or adverse investor sentiment could cause the value of your investment in a Fund to decline. Market disruptions caused by local or regional events such as war, acts of terrorism, the spread of infectious illness

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(including epidemics and pandemics) or other public health issues, recessions or other events or adverse investor sentiment could have a significant impact on the Fund and its investments and could result in the Fund's shares trading at increased premiums or discounts to the Fund's NAV. The outbreak of COVID-19, a respiratory disease caused by a novel coronavirus, has negatively affected the worldwide economy, the financial health of individual companies and the market in significant and unforeseen ways. The future impact of COVID-19 is currently unknown. The effects to public health, business and market conditions resulting from the COVID-19 pandemic may have a significant negative impact on the performance of the Fund's investments. Market risk also includes the risk that a particular style of investing, such as growth or value, may underperform the market generally. The value of the securities in which a Fund invests may go up or down in response to the prospects of individual issuers and/or general economic conditions throughout the world due to increasingly interconnected global economies and financial markets. As a result, whether or not a Fund invests in securities of issuers located in or with significant exposure to the countries directly affected, the value and liquidity of a Fund's investment may be negatively affected. Securities markets may experience great short-term volatility and may fall sharply at times. Different markets may behave differently from each other and a foreign market may move in the opposite direction from the U.S. market. Price changes may be temporary or last for extended periods. You could lose money over short periods due to fluctuation in a Fund's NAV in response to market movements, and over longer periods during market downturns.

The following risk applies only to the Index Funds:

**Index Risk** 

Index risk is the risk that an Index Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its Underlying Index, even if that security generally is underperforming, because unlike many investment companies, the Index Fund does not utilize an investing strategy that seeks returns in excess of an index. Additionally, each Index Fund rebalances and/or reconstitutes its portfolio in accordance with its Underlying Index, and, therefore, any changes to the Underlying Index's rebalance and/or reconstitution schedule will result in corresponding changes to the Index Fund's rebalance and/or reconstitution schedule.

**Tracking Error Risk** 

Tracking error risk is the risk that an Index Fund's performance may vary substantially from the performance of its Underlying Index. An Index Fund's performance may vary from the performance of its Underlying Index for a number of reasons, including that the Index Fund incurs operating expenses that the Underlying Index does not and that the Index Fund accepts custom baskets.

**Sampling Risk** 

Sampling Risk is the risk that an Index Fund's use of a representative sampling approach may result in increased tracking error because the securities selected for an Index Fund in the aggregate may vary from the investment profile of its Underlying Index. Additionally, the use of a representative sampling approach may result in an Index Fund holding a smaller number of securities than its Underlying Index, and, as a result, an adverse development to an issuer of securities that the Index Fund holds could result in a greater decline in NAV than would be the case if the Index Fund held all of the securities in its Underlying Index.

**Calculation Methodology Risk** 

Each of the Index Funds is subject to Calculation Methodology Risk. This is the risk that the Underlying Index's calculation methodology or sources of information may not provide an accurate assessment of included issuers or correct valuation of securities, nor is the availability or timeliness of the production of the Index guaranteed. A security included in an Underlying

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Index may not exhibit the characteristic or provide the specific exposure for which it was selected and consequently a Fund's holdings may not exhibit returns consistent with that characteristic or exposure. Unusual market conditions may cause the provider of the Underlying Index to postpone a scheduled rebalance, which could cause the Underlying Index to vary from its normal or expected composition.

**Concentration Risk** 

If an Index Fund is concentrated in a particular industry or group of industries, the Index Fund is likely to present more risks than a fund that is broadly diversified over several industries or groups of industries. Compared to the broad market, an individual industry may be more strongly affected by changes in the economic climate, broad market shifts, moves in a particular dominant stock or regulatory changes.

The following risks apply to each Fund, as disclosed:

**Interest Rate/Maturity Risk** 

FlexShares iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares Ready Access Variable Income Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, and FlexShares Core Select Bond Fund are subject to the risk that the value of the Funds' fixed-income assets will decline because of rising interest rates. The magnitude of this decline will often be greater for longer-duration fixed income securities than shorter-duration fixed-income securities. Duration is a measure used to determine the sensitivity of a security's price to changes in interest rates. The longer a security's duration, the more sensitive it will be to changes in interest rates.

**MLP Risk** 

FlexShares STOXX Global Broad Infrastructure Index Fund and FlexShares Real Assets Allocation Index Fund are subject to the risk that accompanies an investment in MLP units. The risks of investing in an MLP are similar to those of investing in a partnership, including more flexible governance structures, which could result in less protection for investors, such as the Fund, than investments in a corporation. An investor in an MLP normally would not be liable for the debts of the MLP beyond the amount that the investor has contributed but may not be shielded from liability to the same extent that a shareholder of a corporation would be. MLPs are also subject to risks related to potential conflicts of interest between the MLP and the MLP's general partner and cash flow risks. MLPs that concentrate in a particular industry or a particular geographic region are subject to risks associated with such industry or region. MLPs may also be sensitive to changes in interest rates and during periods of interest rate volatility, limited capital markets access and/or low commodities pricing and may not provide attractive returns.

**MLP Tax Risk** 

FlexShares STOXX Global Broad Infrastructure Index Fund and FlexShares Real Assets Allocation Index Fund are subject to the tax risk that accompanies an investment in MLP units. An MLP is a public limited partnership or limited liability company taxed as a partnership under the Internal Revenue Code of 1986. MLPs taxed as partnerships do not pay U.S. federal income tax at the partnership level, subject to the application of certain partnership audit rules. A change in current tax law, or a change in the underlying business mix of a given MLP, however, could result in an MLP being classified as a corporation for U.S. federal income tax purposes, which would have the effect of reducing the amount of cash available for distribution by the MLP and, as a result, could result in a reduction of the value of a Fund's investment (and the Fund), and, consequently, lower income.

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**New Fund Risk** 

FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, and FlexShares ESG & Climate Investment Grade Corporate Core Index Fund are subject to the risk that each Fund will not grow to or maintain an economically viable size, in which case it may experience greater tracking error to its Underlying Index than it otherwise would at higher asset levels, or it could ultimately liquidate without shareholder approval. The timing of such liquidation may not be favorable and could have negative tax consequences for shareholders. From time to time, an Authorized Participant, a third-party investor, a Fund's adviser or an affiliate of the Fund's adviser, may invest in the Fund and hold its investment for a specific period of time in order to facilitate commencement of the Fund's operations or for the Fund to achieve size or scale. There can be no assurance that any such entity would not redeem its investment or that the size of a Fund would be maintained at such levels, which could negatively impact the Fund. Each Fund's Distributor does not maintain a secondary market in the shares.

**Non-diversification Risk** 

FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, and FlexShares ESG & Climate Investment Grade Corporate Core Index Fund are subject to the risk that because the Funds are non-diversified and may invest a larger percentage of their respective assets in the securities of fewer issuers than a diversified fund, each Fund's performance will be more vulnerable to changes in the market value of a single issuer or group of issuers, and more susceptible to risks associated with a single economic, political or regulatory occurrence.

**Mid and Small Cap Stock Risk** 

FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX US ESG Select Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and FlexShares International Quality Dividend Dynamic Index Fun are subject to the risk that stocks of mid-sized and smaller companies may be more volatile than stocks of larger, more established companies, and may lack sufficient market liquidity. Mid-sized and small companies may have limited product lines or financial resources, may be dependent upon a particular niche of the market, or may be dependent upon a small or inexperienced management group. Smaller companies may also include micro-capitalization companies. Securities of smaller companies may trade less frequently and in lower volume than the securities of larger companies, which could lead to higher transaction costs. Generally the smaller the company size, the greater the risk.

**Valuation Risk** 

FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources

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Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, and FlexShares Ready Access Variable Income Fund are subject to the risk that the sale price the Funds could receive for a security may differ from the Funds' valuation of the security, particularly for securities that trade in low volume or volatile markets, or that are valued using a fair value methodology.

**Value Investing Risk** 

FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares Global Quality Real Estate Index Fund, and FlexShares Real Assets Allocation Index Fund are subject to the risk that each Fund's investment in companies whose securities are believed to be undervalued, relative to their underlying profitability, will not appreciate in value as anticipated.

**ESG Investment Risk** 

FlexShares STOXX US ESG Select Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, and FlexShares ESG & Climate Investment Grade Corporate Core Index Fund are subject to the risk that because the methodology of each Fund's Underlying Index selects and assigns weights to securities of issuers for nonfinancial reasons, each Fund may underperform the broader equity market or other funds that do not utilize ESG investment criteria. Although each Fund's Underlying Index is designed to measure a portfolio of companies with certain ESG characteristics, there is no assurance that the Underlying Index or Fund will be comprised of such securities or that companies that have historically exhibited such characteristics will continue to exhibit such characteristics. There is also the risk that a Fund may have indirect exposure to companies that have been excluded from its Underlying Index through its use of certain derivative instruments. In addition, because investors can differ in their views of what constitutes positive or negative ESG characteristics, a Fund may invest in companies that do not reflect the beliefs and values of any particular investor. A company included in a Fund's Underlying Index may not exhibit positive or favorable ESG characteristics.

Currently, there is a lack of common industry standards relating to the development and application of ESG criteria, which may make it difficult to compare a Fund's principal investment strategies with the investment strategies of other funds that integrate certain ESG criteria. The subjective value that investors may assign to certain types of ESG characteristics may differ substantially from that of the assessment by the Index Provider or a data provider. Investors can differ in their views of what constitutes positive or negative ESG characteristics. As a result, the Fund may invest in companies that do not reflect the beliefs and values of any particular investor. A company included in the Underlying Index may not exhibit positive or favorable ESG characteristics. The companies selected by the Index Provider as demonstrating certain ESG characteristics may not be the same companies selected by other index providers or investment managers as exhibiting those characteristics.

An Index Provider relies on various sources of information regarding an issuer, including information that may be based on assumptions and estimates. ESG information from third-party data providers may be incomplete, inaccurate or unavailable. Neither a Fund nor NTI can offer assurances that a Fund's Underlying Index's methodology or sources of information will

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provide an accurate assessment of the issuers of the securities included in the Fund's Underlying Index. Index Providers use third-party data that they believe to be reliable, but they do not guarantee the accuracy of such third-party data. Data can vary across providers or within industries. ESG standards differ by region and industry, and a company's ESG practices or an Index Provider's or data providers' assessment of a company's ESG practices may change over time. Regulatory changes or interpretations regarding the definitions and/or use of ESG criteria could have a material adverse effect on a Fund's ability to invest in accordance with its investment policies and/or achieve its investment objective.

**High Portfolio Turnover Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, and FlexShares ESG *& Climate High Yield Corporate Core Index Fund* are subject to the risk that active and frequent trading of each Fund's portfolio securities may result in increased transaction costs to the Fund, including brokerage commissions, dealer mark-ups and other transaction costs, which could reduce the Fund's return.

**Global Natural Resources Risk** 

FlexShares Morningstar Global Upstream Natural Resources Index Fund and FlexShares Real Assets Allocation Index Fund are subject to the risks associated with investment in the global natural resources sector in addition to the general risk of the stock market. The natural resources sector can be significantly affected by events relating to U.S. and foreign political and economic developments and environmental and other government regulations, as well as other factors including, but not limited to: commodity price volatility, technological developments and natural or man-made disasters. Declines in the demand for, or prices of, natural resources generally would be expected to contribute to declines in the value of a Fund's equity securities. Such declines may occur quickly and without warning and may negatively impact the value of a Fund and your investment.

**Infrastructure-Related Companies Risk** 

FlexShares STOXX Global Broad Infrastructure Index Fund and FlexShares Real Assets Allocation Index Fund are subject to the risks associated with investment in infrastructure-related companies in addition to the general risk of the stock market. Risks associated with infrastructure-related companies include: (a) realized revenue volume may be significantly lower than projected and/or there will be cost overruns; (b) infrastructure project sponsors will alter their terms making a project no longer economical; (c) macroeconomic factors such as low gross domestic product ("GDP") growth or high nominal interest rates will raise the average cost of infrastructure funding; (d) government regulation may affect rates charged to infrastructure customers; (e) government budgetary constraints will impact infrastructure projects; (f) special tariffs will be imposed; and (g) changes in tax laws, regulatory policies or accounting standards could be unfavorable. Other risks include environmental damage due to a company's operations or an accident, a natural disaster, changes in market sentiment towards infrastructure and terrorist acts. Any of these events could cause the value of a Fund's or Underlying Fund's investments in infrastructure-related companies to decline.

**Hedging Risk** 

FlexShares Core Select Bond Fund is subject to the risk that the Fund's short positions in U.S. Treasury futures and similar positions through transactions in interest rate swaps will not completely eliminate interest rate risk of long positions in bonds. In certain falling interest rate environments, the Fund's hedging strategy could result in disproportionately larger losses in the short U.S. Treasury futures and interest rate swaps positions as compared to gains in the long bond positions attributable to interest rate changes.

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**Corporate Bond Risk** 

FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, and FlexShares Credit-Scored US Long Corporate Bond Index Fund invest primarily in bonds issued by corporations. Corporate debt securities are subject to the risk of the issuer's inability to meet principal and interest payments on the obligation and may also be subject to price volatility due to such factors as interest rate sensitivity, market perception of the creditworthiness of the issuer and general market liquidity. When interest rates rise, the value of corporate debt can be expected to decline. Debt securities with longer maturities tend to be more sensitive to interest rate movements than those with shorter maturities.

**Interest Rate Risk** 

FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, and FlexShares Real Assets Allocation Index Fund are subject to the risk that rising interest rates may adversely affect the Funds. Increases in interest rates typically lower the present value of a REIT's future earnings stream, and may make financing property purchases and improvements more costly. Because the market price of REIT stocks may change based upon investors' collective perceptions of future earnings, the value of a Fund may decline when investors anticipate or experience rising interest rates.

In general, securities with longer maturities or durations are more sensitive to interest rate changes. Changing interest rates, including rates that fall below zero, may have unpredictable effects on the markets and a Fund's investments, may result in heightened market volatility, may impact the liquidity of fixed-income securities and of the Fund, and may detract from Fund performance. A low or negative interest rate environment could cause a Fund's earnings to fall below the Fund's expense ratio, resulting in a low or negative yield and a decline in the Fund's NAV. A general rise in interest rates may cause investors to move out of fixed income securities on a large scale, which could adversely affect the price and liquidity of fixed income securities and could also result in increased redemptions for a Fund.

**Cash Transactions Risk** 

FlexShares Disciplined Duration MBS Index Fund and FlexShares Ready Access Variable Income Fund may effect creation or redemption orders of their shares entirely for cash, rather than for in-kind securities. Paying redemption proceeds entirely in cash rather than through in-kind delivery of portfolio securities may require a Fund to dispose of or sell portfolio securities or other assets at an inopportune time to obtain the cash needed to meet redemption orders. This may cause a Fund to sell a security or other financial instrument and recognize a capital gain or loss that might not have been incurred if it had not effected a redemption order entirely for cash. As a result, investment in a Fund's shares may be less tax efficient than investment in an ETF that meets redemption orders entirely in-kind with portfolio securities. The use of all cash creations and redemption orders may also cause a Fund's shares to trade in the secondary market at wider bid-ask spreads and/or greater premiums or discounts to the Fund's NAV. To the extent that the maximum additional variable charge for cash creation or cash redemption transactions is insufficient to cover the transaction costs of purchasing or selling portfolio securities, a Fund's performance could be negatively impacted.

**China Investment Risk** 

FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, and FlexShares ESG & Climate Emerging Markets Core Index Fund are subject to the risks associated with investments in companies located or operating in China, such as nationalization, expropriation, or confiscation of property; alteration or discontinuation of economic reforms; and considerable degrees of economic, political and social instability.

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Investors in Chinese markets generally experience difficulties in obtaining information necessary for investigations into and/or litigation against Chinese companies, as well as in obtaining and/or enforcing judgements due to a lack of publicly available information; and there are generally limited legal remedies for shareholders. Internal social unrest or confrontations with other neighboring countries, including military conflicts, may disrupt economic development in China and result in a greater risk of currency fluctuations, currency convertibility, interest rate fluctuations and higher rates of inflation. Export growth continues to be a major driver of China's rapid economic growth. As a result, a reduction in spending on Chinese products and services, the institution of additional tariffs or other trade barriers, including as a result of heightened trade tensions between China and the U.S., or a downturn in any of the economies of China's key trading partners may have an adverse impact on the Chinese economy. The inability of the Public Company Accounting Oversight Board ("PCAOB") to inspect audit work papers and practices of PCAOB-registered accounting firms in China with respect to their audit work of U.S. reporting companies may impose significant additional risks associated with investments in China. Certain securities issued by companies located or operating in China, such as China A-shares, are subject to trading restrictions and suspensions, quota limitations and sudden changes in those limitations, and operational, clearing and settlement risks.

**Taiwan Investment Risk** 

FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, and FlexShares ESG & Climate Emerging Markets Core Index Fund are subject to the risks of investing in securities of Taiwanese issuers. Specifically, Taiwan's geographic proximity and history of political contention with China have resulted in ongoing tensions between the two countries, which may materially affect the Taiwanese economy and its securities market. Investments in securities of Taiwanese companies are subject to Taiwan's heavy dependence on exports. Reductions in spending on Taiwanese products and services, labor shortages, institution of tariffs or other trade barriers, or a downturn in any of the economies of Taiwan's key trading partners, including the United States, may have an adverse impact on the Taiwanese economy and the values of Taiwanese companies.

**Foreign Securities Risk** 

FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that investing in foreign (non-U.S.) securities may result in a Fund experiencing more rapid and extreme changes in value than a fund that invests exclusively in securities of U.S. companies, due to less liquid markets and adverse economic, political, diplomatic, financial, and regulatory factors. Foreign governments may impose limitations on foreigners' ownership of interests in local issuers, restrictions on the ability to repatriate assets, and may also impose taxes. Any of these events could cause the value of a Fund's investments to decline. Foreign banks, agents and securities depositories that hold a Fund's foreign assets may be subject to little or no regulatory oversight over, or independent evaluation, of their operations. Additional costs associated with investments in foreign securities may include higher custodial fees than those applicable to domestic custodial arrangements and

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transaction costs of foreign currency conversions. Unless a Fund has hedged its foreign currency exposure, foreign securities risk also involves the risk of negative foreign currency rate fluctuations, which may cause the value of securities denominated in such foreign currency (or other instruments through which the Fund has exposure to foreign currencies) to decline in value. Currency exchange rates may fluctuate significantly over short periods of time. Currency hedging strategies, if used, are not always successful. For instance, forward foreign currency exchange contracts, if used by a Fund, could reduce performance if there are unanticipated changes in currency exchange rates.

**Emerging Markets Risk** 

FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, and FlexShares Ready Access Variable Income Fund are subject to the risk that investments in emerging markets are generally subject to greater market volatility, political, social and economic instability, uncertain trading markets and more governmental limitations on foreign investments than more developed markets. In addition, companies operating in emerging markets may be subject to lower trading volumes and greater price volatility than companies in more developed markets. Emerging market economies may be based on only a few industries, may be highly vulnerable to changes in local and global trade conditions, and may suffer from extreme and volatile debt burdens or inflation rates. Companies in emerging market countries generally may be subject to less stringent regulatory, disclosure, financial reporting, accounting, auditing and recordkeeping standards than companies in more developed countries. As a result, information, including financial information, about such companies may be less available and reliable, which can impede a Fund's ability to evaluate such companies. Securities law and the enforcement of systems of taxation in many emerging market countries may change quickly and unpredictably, and the ability to bring and enforce actions (including bankruptcy, confiscatory taxation, expropriation, nationalization of a company's assets, restrictions on foreign ownership of local companies, restrictions on withdrawing assets from the country, protectionist measures and practices such as share blocking), or to obtain information needed to pursue or enforce such actions, may be limited. Investments in emerging market securities may be subject to additional transaction costs, delays in settlement procedures, unexpected market closures, and lack of timely information.

**Japan Investment Risk** 

FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, and FlexShares Developed Markets ex-US Quality Low Volatility Index Fund are subject to the risks of investment in securities of Japanese issuers. The Japanese economy may be subject to considerable degrees of economic, political and social instability, which could negatively impact Japanese issuers. In recent times, Japan's economic growth rate has remained low, and it may remain low in the future. In addition, Japan is subject to the risk of natural disasters, such as earthquakes, volcanic eruptions, typhoons and tsunamis, which could negatively affect the securities of Japanese companies held by a Fund.

**South Korea Investment Risk** 

FlexShares Morningstar Emerging Markets Factor Tilt Index Fund is subject to the risks of investment in securities of South Korean issuers. South Korean issuers in which the Fund invests may subject the Fund to legal, regulatory, political, currency, security, and economic risks that are specific to South Korea. In addition, economic and political developments of South Korea's neighbors, including escalated tensions involving North Korea and any outbreak of hostilities involving North Korea, or even the threat of an outbreak of hostilities, may have a severe adverse effect on the South Korean economy.

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**United Kingdom Investment Risk** 

FlexShares ESG & Climate Developed Markets ex- US Core Index Fund is subject to the risks of investment in securities of United Kingdom issuers. Investments in issuers located in the United Kingdom ("UK") may subject the Fund to regulatory, political, currency, security and economic risk specific to the UK. The UK has one of the largest economies in Europe and is heavily dependent on trade with the European Union ("EU"). As a result, the UK economy may be impacted by changes to the economic health of EU member countries. In 2016, the UK voted to leave the EU (commonly known as "Brexit"), and on January 31, 2020, the UK officially withdrew from the EU. The precise impact on the UK's economy as a result of its departure from the EU depends to a large degree on its ability to conclude favorable trade deals with the EU and other countries. While new trade deals may boost economic growth, such growth may not be able to offset the increased costs of trade with the EU resulting from the UK's loss of its membership in the EU single market.

**Dividend Risk** 

FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and FlexShares International Quality Dividend Dynamic Index Fund are subject to the risk that an issuer of stock held by a Fund may choose not to declare a dividend or the dividend rate might not remain at current levels. Dividend paying stocks might not experience the same level of earnings growth or capital appreciation as non-dividend paying stocks. A Fund's performance during a broad market advance could suffer because dividend paying stocks may not experience the same capital appreciation as non-dividend paying stocks.

**Volatility Risk** 

FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and FlexShares International Quality Dividend Dynamic Index Fund are subject to the risk that the actual level of volatility experienced by a Fund may be greater or lower than the targeted overall volatility of the Fund's Underlying Index. Although a Fund's Underlying Index is designed to have a targeted overall volatility, there is no guarantee that it will have the targeted overall volatility. A Fund will continue to seek to track the Underlying Index even if the Underlying Index does not have the targeted overall volatility. There is also the risk that a Fund may experience volatility greater or lower than that of the Underlying Index as a result of tracking error. A portfolio of securities with greater volatility is generally considered to have a higher risk profile than a portfolio with lower volatility.

**Real Estate Securities Risk** 

FlexShares Global Quality Real Estate Index Fund and FlexShares Real Assets Allocation Index Fund are subject to the risks associated with investment in the real estate sector in addition to the general risk of the stock market. Investing in securities of real estate companies will make an Underlying Fund, and the Fund, more susceptible to risks associated with the owner-ship of real estate and with the real estate industry in general, as well as risks that relate specifically to the way in which real estate companies are organized and operated. Real estate companies may have lower trading volumes and may be subject to more abrupt or erratic price movements than the overall securities markets. The value of real estate securities may underperform other sectors of the economy or broader equity markets. To the extent that an Underlying Fund, and the Fund, concentrates its investments in the real estate sector, it may be subject to greater risk of loss than if it were diversified across different industry sectors.

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**Real Estate Investment Trust (REIT) Risk** 

FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, and FlexShares STOXX<sup>®</sup> Global Broad Infrastructure Index Fund are subject to the risk that a Fund's investments may be affected by factors affecting REITs and the real estate sector generally. Investing in REITs involves certain unique risks in addition to those risks associated with investing in the real estate industry in general. REITs whose underlying properties are concentrated in a particular industry or geographic region are also subject to risks affecting such industries and regions. By investing in REITs through the Fund, a shareholder will bear expenses of the REITs in addition to expenses of the Fund.

**Underlying Fund Risk** 

FlexShares Core Select Bond Fund is subject to the risk that the Fund's investment performance and its ability to achieve its investment objective may be directly related to the performance of the Underlying Funds in which it invests. There can be no assurance that the Underlying Funds will achieve their respective investment objectives. The Fund is subject to the risks of the Underlying Funds in direct proportion to the allocation of its assets among the Underlying Funds. By investing in the Underlying Funds indirectly through the Fund, you will incur not only a proportionate share of the expenses of the Underlying Fund held by the Fund (including operating costs and investment management fees), but also expenses of the Fund.

**Fund of Funds Risk** 

FlexShares Real Assets Allocation Index Fund is subject to the risk that the Fund's investment performance largely depends on the investment performance of the Underlying Fund(s) in which it primarily invests. The Fund's NAV will change with changes in the value of the Underlying Fund(s) and other securities in which the Fund invests based on their market valuations.

An investment in the Fund will entail more costs and expenses than direct investments in the Underlying Fund(s). The Fund will indirectly pay a proportional share of the expenses of the Underlying Fund(s) in which it invests (including operating expenses and management fees), in addition to the fees and expenses it pays directly. As the Fund's allocation to an Underlying Fund changes from time to time, or to the extent that the expense ratio of an Underlying Fund changes, the weighted average operating expenses borne by the Fund may increase or decrease.

**Tax Risk** 

FlexShares Real Assets Allocation Index Fund is subject to the risk that, because the Fund invests in the Underlying Funds, the Fund's realized losses on sales of shares of the Underlying Funds may be indefinitely or permanently deferred as "wash sales." Distributions of short-term capital gains by the Underlying Funds will be recognized as ordinary income by the Fund and would not be offset by the Fund's capital loss carryforwards, if any. Capital loss carryforwards of the Underlying Funds, if any, would not offset net capital gains of the Fund. Each of these effects is caused by the Fund's investment in the Underlying Funds and may result in distributions to Fund shareholders being of higher magnitudes and less likely to qualify for lower capital gain tax rates than if the Fund were to invest otherwise.

**Credit (or Default) Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that the inability or unwillingness of an issuer or guarantor of a fixed-income security, or a counterparty to a TBA, repurchase or other

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transaction, to meet its payment or other financial obligations will adversely affect the value of the Fund's investments and its returns. The credit quality of a debt security or of the issuer of a debt security held by the Fund could deteriorate rapidly, which may impair the Fund's liquidity or cause a deterioration in the Fund's NAV. The Fund could also be delayed or hindered in its enforcement of rights against an issuer, guarantor or counterparty. The degree of credit risk depends on the issuer's or counterparty's financial condition and on the terms of the securities.

**Debt Extension Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that an issuer will exercise its right to pay principal on an obligation held by the Fund (such as a mortgage-backed security) later than expected. This will cause the value of the obligation, and a Fund's NAV, to decrease and the Fund may lose opportunities to invest in higher yielding securities.

**Liquidity Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that certain portfolio securities may be less liquid than others, which may make them difficult or impossible to sell at the time and the price that the Fund would like, adversely affecting the value of the Fund's investments and its returns. Illiquid investments may be harder to value, especially in changing markets, and if a Fund is forced to sell these investments to meet redemption requests or for other cash needs, the Fund may suffer a loss. Liquidity risk may result from the lack of an active market, reduced number and capacity of traditional market participants to make a market in fixed income securities, and may be magnified in a rising interest rate environment or other circumstances where investor redemptions from fixed income funds may be higher than normal, causing increased supply in the market due to selling activity. The market for certain investments may become illiquid under adverse market or economic conditions independent of any specific adverse changes in the conditions of a particular issuer. In such cases, a Fund, due to limitations on investments in illiquid securities and/or purchasing and selling such investments, may be unable to achieve a high degree of correlation with the the Fund's Underlying Index. Additionally, in adverse market conditions, a Fund's market price may begin to reflect illiquidity or pricing uncertainty of the Fund's portfolio securities. This could lead to the Fund's shares trading at a price that is higher or lower than the Fund's NAV. At times, such differences may be significant.

**Prepayment (or Call) Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that an issuer could exercise its right to pay principal on callable debt securities held by a Fund earlier than expected, which may result in a decreased rate of return and a decline in value of those securities.

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**U.S. Government Securities Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Ready Access Variable Income Fund and FlexShares Core Select Bond Fund are subject to the risk that the U.S. government will not provide financial support to its agencies, instrumentalities or sponsored enterprises if it is not obligated to do so by law. Many U.S. government securities that may be purchased by the Fund are not backed by the full faith and credit of the United States. It is possible that the issuers of such securities will not have the funds to meet their payment obligations in the future.

**Municipal Market Volatility Risk** 

FlexShares Ready Access Variable Income Fund is subject to the risk that the Fund may be adversely affected by volatility in the municipal market. The municipal market can be significantly affected by adverse tax, legislative, political or public health changes and the financial condition of the issuers of municipal securities.

**Mortgage-Backed Pass-Through Securities Risk** 

FlexShares Disciplined Duration MBS Index Fund is subject to the risk of investing in mortgage-backed securities issued by a US Agency. Mortgage-backed securities may be less liquid than other bonds, and may be more sensitive than other bonds to the market's perception of issuers and creditworthiness of payees, particularly in declining general economic conditions when concern regarding mortgagees' ability to pay (e.g., the ability of homeowners, commercial mortgagees, consumers with student loans, automobile loans or credit card debtholders to make payments on the underlying loan pools) rises, which may result in the Fund experiencing difficulty selling or valuing these securities. In addition, these securities may not be backed by the full faith and credit of the U.S. government, have experienced extraordinary weakness and volatility at various times in recent years, and may decline quickly in the event of a substantial economic or market downturn. Mortgage-backed securities are subject to Credit (or Default) Risk, Interest Rate/Maturity Risk, Debt Extension Risk and Prepayment (or Call) Risk. Because of these risks, mortgage-backed securities react differently to changes in interest rates than other bonds. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain mortgage-backed securities. While agency mortgage-backed securities are guaranteed as to the timely payment of interest and principal by a government entity, they are not guaranteed as to market price, which will fluctuate.

**Asset-Backed and Mortgage-Backed Securities Risk** 

FlexShares Ready Access Variable Income Fund and FlexShares Core Select Bond Fund are subject to the risk that asset-backed and mortgage-backed securities may be less liquid than other bonds, and may be more sensitive than other bonds to the market's perception of issuers and creditworthiness of payees, particularly in declining general economic conditions when concern regarding mortgagees' ability to pay (e.g., the ability of homeowners, commercial mortgagees, consumers with student loans, automobile loans or credit card debtholders to make payments on the underlying loan pools) rises, which may result in the Fund experiencing difficulty selling or valuing these securities. In addition, these securities may not be backed by the full faith and credit of the U.S. government, have experienced extraordinary weakness and volatility at various times in recent years, and may decline quickly in the event of a substantial economic or market downturn. Those asset-backed and mortgage-backed securities that are guaranteed as to the timely payment of interest and principal by a government entity, are not guaranteed as to market price, which will fluctuate. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain asset-backed and mortgage-backed securities.

**Distressed Securities Risk** 

FlexShares High Yield Value-Scored Bond Index Fund and FlexShares ESG & Climate High Yield Corporate Core Index Fund are subject to the risks of investing in distressed securities, which are in addition to the risks of investing in non-investment

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grade securities generally. NTI defines securities issued by companies whose financial condition is troubled or uncertain and that may be involved in bankruptcy proceedings, reorganizations or financial restructurings as "distressed securities." Distressed securities are speculative and involve a substantial risk that principal will not be paid. In addition, the Fund will generally not receive interest payments on the distressed securities and may incur costs to protect its investment. These securities may present a substantial risk of default. A 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.

**High Yield Securities Risk** 

FlexShares High Yield Value-Scored Bond Index Fund and FlexShares ESG & Climate High Yield Corporate Core Index Fund are subject to the risk that a Fund will be subject to greater credit risk, price volatility and risk of loss than if it invested primarily in investment grade securities, which can adversely impact the Fund's return and net asset value. High yield securities are considered highly speculative and are subject to increased risk of an issuer's inability to make principal and interest payments. The FlexShares High Yield Value-Scored Bond Index Fund's Underlying Index is designed to be comprised of securities with the potential for higher yields as compared to the overall high yield corporate bond market. As such, the FlexShares High Yield Value-Scored Bond Index Fund is expected to exhibit greater sensitivity to market fluctuations.

**Inflation Protected Security Risk** 

FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and FlexShares iBoxx 5-Year Target Duration TIPS Index Fund are subject to the risk that the value of inflation protected securities, such as TIPS, generally will fluctuate in response to changes in real interest rates, generally decreasing when real interest rates rise and increasing when real interest rates fall. In addition, interest payments on inflation-protected securities will generally vary up or down along with the rate of inflation. Real interest rates are generally measured as a nominal interest less an inflation rate. As such, investors should be aware that an investment in TIPS over a particular timeframe may decrease in value even in an inflationary environment. There can be no assurance that the inflation index used will accurately measure the real rate of inflation in the prices of goods and services. Because of their inflation adjustment feature, inflation-protected bonds typically have lower yields than conventional fixed-rate bonds. In addition, the market for inflation-indexed securities may be less developed or liquid, and more volatile, than certain other securities markets. In addition, positive adjustments to principal generally will result in taxable income to a Fund at the time of such adjustments (which generally would be distributed by a Fund as part of its taxable dividends), even though the principal amount is not paid until maturity.

**Substantial Volatility Risk** 

FlexShares High Yield Value-Scored Bond Index Fund and FlexShares ESG & Climate High Yield Corporate Core Index Fund are subject to the risk that the value of the securities in a Fund's portfolio may fluctuate, sometimes rapidly and unpredictably at a greater level than the overall market. There is a risk that a Fund could have substantial volatility.

**Value Score Risk** 

FlexShares High Yield Value-Scored Bond Index Fund is subject to the risk that the Fund's investment in companies whose securities are believed to be undervalued will not appreciate in value as anticipated. Although the Underlying Index is designed to measure a portfolio of bonds of companies with the potential for higher yields and less risk of insolvency relative

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to the Parent Index, there is no assurance that the Underlying Index or Fund will be comprised of such securities. Accordingly, the Fund may be subject to greater credit risk, price volatility and risk of loss relative to the Parent Index.

**Quality-Value Score Risk** 

FlexShares Credit-Scored US Corporate Bond Index Fund and FlexShares Credit-Scored US Long Corporate Bond Index Fund are subject to the risk that a Fund's investment in companies whose securities are believed to be undervalued will not appreciate in value as anticipated or the past performance of companies that have exhibited quality characteristics does not continue. Although a Fund's Underlying Index is designed to measure a portfolio of bonds that can potentially deliver a higher total return relative to the Parent Index, there is no assurance that the Underlying Index or Fund will be comprised of such securities. Accordingly, a Fund may be subject to greater credit risk, price volatility and risk of loss relative to the Parent Index.

**Sector Risk** 

FlexShares Ready Access Variable Income Fund and FlexShares Core Select Bond Fund are subject to the risk that companies in similar businesses may be similarly affected by particular economic or market events, which may, in certain circumstances, cause the value of securities of all companies in a particular sector of the market to decrease.

**Financial Sector Risk** 

FlexShares Disciplined Duration MBS Index Fund, FlexShares Credit-Scored US Corporate Bond Index Fund, FlexShares ESG & Investment Grade Corporate Core Index Fund, and FlexShares Ready Access Variable Income Fund are subject to the risk that each Fund will be impacted by events affecting the U.S. and/or non-U.S. financial sectors if it invests a relatively large percentage of its assets in those sectors, adversely affecting the Fund's performance. The U.S. and non-U.S. financial sectors can be significantly affected by changes in interest rates, government regulation, the rate of corporate and consumer debt defaulted, price competition and the availability and cost of capital, among other factors.

**Information Technology Sector Risk** 

FlexShares ESG & Climate US Large Cap Core Index Fund is subject to the risk that securities of technology companies may be subject to greater price volatility than securities of companies in other sectors. These securities may fall in and out of favor with investors rapidly, which may cause sudden selling and dramatically lower market prices. Technology securities also may be affected adversely by changes in technology, consumer and business purchasing patterns, government regulation and/or obsolete products or services.

**Equity Securities Risk** 

FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar US Market Factor Tilt Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares STOXX US ESG Select Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate US Large Cap Core Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, Flex-

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Shares International Quality Dividend Dynamic Index Fund are subject to the risks of investing in equity securities, which may be more volatile and underperform other asset classes and the general securities markets.

**Low Volatility Risk** 

FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, and FlexShares Emerging Markets Quality Low Volatility Index Fund are subject to the risk that, although each Fund's Underlying Index is designed to have overall volatility that is lower than that of its Parent Index, there is no guarantee it will be successful. Securities or other assets in the Fund's portfolio may be subject to price volatility and the prices may not be any less volatile than the market as a whole and could be more volatile. The market prices of the securities or other assets in a Fund's portfolio may fluctuate, sometimes rapidly and unpredictably. A Fund will continue to seek to track its Underlying Index even if the Underlying Index does not have lower overall volatility than its Parent Index. There is also the risk that a Fund may experience volatility greater than that of its Parent Index as a result of tracking error. A portfolio of securities with greater volatility is generally considered to have a higher risk profile than a portfolio with lower volatility.

**Depositary Receipts Risk** 

FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and FlexShares International Quality Dividend Dynamic Index Fund are subject to the risks that depositary receipts may expose the Funds to investment risks associated with the underlying issuers and additional risks associated with non-uniform terms that apply to depositary receipt programs, including credit exposure to the depository bank and to the sponsors and other parties with whom the depository bank establishes the programs, currency, political, economic, market risks and the risks of an illiquid market for depositary receipts. Depositary receipts are generally subject to the same risks as the foreign securities that they evidence or into which they may be converted. Depositary receipts may not track the price of the underlying foreign securities on which they are based, may have limited voting rights, and may have a distribution subject to a fee charged by the depository. As a result, equity shares of the underlying issuer may trade at a discount or premium to the market price of the depositary receipts.

**Geographic Risk** 

FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares Morningstar Developed Markets ex-US Factor Tilt Index Fund, FlexShares Morningstar Emerging Markets Factor Tilt Index Fund, FlexShares STOXX Global ESG Select Index Fund, FlexShares ESG & Climate Developed Markets ex-US Core Index Fund, FlexShares ESG & Climate Emerging Markets Core Index Fund, FlexShares Morningstar Global Upstream Natural Resources Index Fund, FlexShares STOXX Global Broad Infrastructure Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, FlexShares International Quality Dividend Dynamic Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that if a Fund invests a significant portion of its total assets in certain issuers within the same country or geographic region, an economic, business or political development affecting that country or region may affect the value of the Fund's investments more than if the Fund's investments were not so concentrated in such country or region.

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**Income Risk** 

FlexShares iBoxx 3-Year Target Duration TIPS Index Fund, FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, FlexShares Disciplined Duration MBS Index Fund, FlexShares CreditScored U.S Corporate Bond Index Fund, FlexShares Credit-Scored US Long Corporate Bond Index Fund, FlexShares High Yield Value-Scored Bond Index Fund, FlexShares ESG & Climate High Yield Corporate Core Index Fund, FlexShares ESG & Climate Investment Grade Corporate Core Index Fund, FlexShares Ready Access Variable Income Fund, and FlexShares Core Select Bond Fund are subject to the risk that a Fund's income may decline due to a decline in inflation (or deflation) or due to changes in inflation expectations.

**Quality Factor Risk** 

FlexShares US Quality Low Volatility Index Fund, FlexShares Developed Markets ex-US Quality Low Volatility Index Fund, FlexShares Emerging Markets Quality Low Volatility Index Fund, FlexShares US Quality Large Cap Index Fund, FlexShares Global Quality Real Estate Index Fund, FlexShares Real Assets Allocation Index Fund, FlexShares Quality Dividend Index Fund, FlexShares Quality Dividend Defensive Index Fund, FlexShares Quality Dividend Dynamic Index Fund, FlexShares International Quality Dividend Index Fund, FlexShares International Quality Dividend Defensive Index Fund, and FlexShares International Quality Dividend Dynamic Index Fund are subject to the risk that the past performance of companies that have exhibited quality characteristics does not continue or the returns on securities issued by such companies may be less than returns from other styles of investing or the overall stock market. There may be periods when quality investing is out of favor and during which time a Fund's performance may suffer.

**Momentum Risk** 

FlexShares US Quality Large Cap Index Fund, FlexShares Global Quality Real Estate Index Fund, and FlexShares Real Assets Allocation Index Fund are subject to the risk that securities that have had positive momentum compared to other securities may be more volatile than a broad cross-section of securities or that returns on securities that have previously exhibited positive momentum are less than returns on other securities or the overall stock market. Momentum can turn quickly and cause significant variation from other types of investments.

**Model Risk** 

FlexShares Real Assets Allocation Index Fund is subject to the risk that the asset allocation model used to calculate the Underlying Index will not achieve its intended results.

**Management Risk** 

FlexShares Ready Access Variable Income Fund is subject to the risk a strategy used by NTI may fail to produce the intended results or that imperfections, errors or limitations in the tools and data used by NTI may cause unintended results.

**Leveraging Risk** 

FlexShares Ready Access Variable Income Fund is subject to the risk that certain transactions of a Fund, such as the use of when-issued, delayed delivery or forward commitment transactions and investments in forward foreign currency contracts, may give rise to leverage, causing the Fund to be more volatile than if it had not been leveraged.

**Seed Investor Risk** 

FlexShares ESG & Climate High Yield Corporate Core Index Fund is subject to the risk that may result from NTI and/or its affiliates making payments to one or more investors to contribute seed capital to the Fund, such as an Authorized Participant,

FLEXSHARES ANNUAL REPORT 573

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##### [**Table of Contents**](#toc)

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Supplemental Information (cont.)

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a market maker and/or another entity. Such payments may continue for a specified period of time and/or until a specified dollar amount is reached. Those payments will be made from the assets of NTI and/or its affiliates (and not the Fund). Seed investors may contribute all or a majority of the assets in the Fund. There is a risk that such seed investors may redeem their investments in the Fund, particularly after payments from NTI and/or its affiliates have ceased. As with redemptions by other large shareholders, redemptions by seed investors could have a significant negative impact on the Fund, including on the Fund's liquidity and the market price of the Fund's shares.

**Premium/Discount Information** 

Information about the differences between the daily market prices on secondary markets for shares of the Funds and the Funds' net asset values for various time periods, as applicable, is available by visiting the Funds' website at flexshares.com

574 FLEXSHARES ANNUAL REPORT

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##### [**Table of Contents**](#toc)

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## For More Information (Unaudited)

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**Portfolio Holdings** 

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FlexShares<sup>®</sup> Trust files its complete schedule of portfolio holdings with the Securities and Exchange Commission ("SEC") for the first and third quarters of each fiscal year an exhibit to its reports on Form N-PORT. The Funds' Forms N-PORT are available on the SEC's website at sec.gov.

**Proxy Voting** 

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FlexShares<sup>®</sup> Trust Proxy Voting Policies and Procedures are available upon request and without charge by calling 1-855-FLEXETF (1-855-353-9383) or by visiting the Funds' website flexshares.com or the SEC's website at sec.gov. Each Fund's portfolio securities voting record for the 12-month period ended June 30 is available upon request and without charge by calling 1-855-FLEXETF (1-855-353-9383) or by visiting the SEC's website at sec.gov.

FLEXSHARES ANNUAL REPORT 575

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##### [**Table of Contents**](#toc)
![LOGO](g402077g00c42.jpg)

## FlexShares<sup>®</sup> Trust
50 S. LaSalle Street

Chicago, IL 60603

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;800.595.9111 <u>www.flexshares.com</u>

FlexShares<sup>®</sup> is a registered trademark of NTI. Morningstar<sup>®</sup> is a registered trademark of Morningstar, Inc. ("Morningstar"). Morningstar<sup>®</sup> US Market Factor Tilt Index<sup>SM</sup>, Morningstar<sup>®</sup> Developed Markets ex-US Factor Tilt Index<sup>SM</sup>, Morningstar<sup>®</sup> Emerging Markets Factor Tilt Index<sup>SM</sup>, and Morningstar<sup>®</sup> Global Upstream Natural Resources Index<sup>SM</sup> are service marks of Morningstar, Inc. STOXX and its licensors (the "Licensors") have no relationship to FlexShares<sup>®</sup> Trust other than the licensing of the STOXX<sup>®</sup> USA ESG Select KPIs Index, STOXX<sup>®</sup> Global ESG Select KPIs Index and STOXX<sup>®</sup> Global Broad Infrastructure Index and the related trademarks for use in connection with the FlexShares<sup>®</sup> STOXX<sup>®</sup> US ESG Select Index Fund, FlexShares<sup>®</sup> STOXX<sup>®</sup> Global ESG Select Index Fund and FlexShares<sup>®</sup> STOXX<sup>®</sup> Global Broad Infrastructure Index Fund, respectively. The iBoxx 3-Year Target Duration TIPS Index and iBoxx 5-Year Target Duration TIPS Index are each the property of Markit North America, Inc. ("Markit") and have been licensed for use in connection the FlexShares iBoxx 3-Year Target Duration TIPS Index Fund and the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund, respectively. Northern Trust Quality Low Volatility Index<sup>SM</sup>, Northern Trust Developed Markets ex-US Quality Low Volatility Index<sup>SM</sup>, Northern Trust Emerging Markets Quality Low Volatility Index<sup>SM</sup>, Northern Trust Quality Large Cap Index<sup>SM</sup>, Northern Trust Quality Dividend Index<sup>SM</sup>, Northern Trust Quality Dividend Dynamic Index<sup>SM</sup>, Northern Trust Quality Dividend Defensive Index<sup>SM</sup>, Northern Trust International Quality Dividend Index<sup>SM</sup>, Northern Trust Quality Dividend Dynamic Index<sup>SM</sup>, Northern Trust International Quality Dividend Defensive Index<sup>SM</sup>, Northern Trust Global Quality Real Estate Index<sup>SM</sup>, Northern Trust Credit-Scored US Corporate Bond Index<sup>SM</sup>, Northern Trust Credit-Scored US Long Corporate Bond Index<sup>SM</sup>, Northern Trust Real Assets Allocation Index<sup>SM</sup>, Northern Trust High Yield US Corporate Bond Index<sup>SM</sup>, and Northern Trust High Yield Value-Scored US Corporate Bond Index<sup>SM</sup> are service marks of NTI and have been licensed for use by FlexShares Trust. The ICE<sup>®</sup> BofAML<sup>®</sup> Constrained Duration US Mortgage Backed Securities Index<sup>SM</sup> are trademarks of ICE Data Indices, LLC or its affiliates ("ICE") and have been licensed for use by NTI.

FS00058-1222

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##### [**Table of Contents**](#toc)
b.) A copy of the notice transmitted to shareholders in reliance on Rule 30e-3 under the Investment Company Act of 1940, as amended (the "1940 Act") that contains disclosures specified by paragraph (c)(3) of that rule. Not applicable.

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##### [**Table of Contents**](#toc)
**Item 2. Code of Ethics.** 

(a) As of the end of the period, October 31, 2022, the Registrant has adopted a code of ethics that applies to
its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Registrant or a third party (the
"Code of Ethics").

(b) Not Applicable.

(c) The Registrant has not amended its Code of Ethics during the period covered by this report.

(d) The Registrant has not granted any waivers, including an implicit waiver, from any provisions of its Code of
Ethics during the period covered by this report.

(e) Not Applicable.

(f) A copy of the Registrant's Code of Ethics is attached as exhibit 13(a)(1) to this Form N-CSR.

**Item 3. Audit Committee Financial Expert.** 

The Registrant's Board of Trustees has determined that the Registrant has at least one "audit committee financial expert" (as defined in Item 3 of Form N-CSR), serving on its audit committee. Philip G. Hubbard is the "audit committee financial expert" and is "independent" (as each term is defined in Item 3 of Form N-CSR).

Under applicable securities laws and regulations, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for purposes of Section 11 of the Securities Act of 1933, as amended, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liability that are greater than the duties, obligations, and liability imposed on such person as a member of the Registrant's Audit Committee and Board of Trustees in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations or liability of any other member of the Registrant's Audit Committee or Board of Trustees.

**Item 4. Principal Accountant Fees and Services.** 

In response to Items 4(a)-4(d), aggregate fees for professional services rendered for FlexShares<sup>®</sup> Trust by Deloitte & Touche, LLP ("Deloitte") for the fiscal years ended October 31, 2022 and October 31, 2021 were:

---

| | | |
|:---|:---|:---|
|  | **2022** | **2022** |
|  | All fees and<br>services to the<br>Trust that were<br>pre-approved | All fees and<br>services to<br>Service Affiliates<sup>(a)</sup><br>that were pre-<br>approved |
|  Audit Fees | $736000 | N/A |
|  Audit Related Fees<sup>(b)</sup> | $0 | $0 |
|  Tax Fees<sup>(c)</sup> | $83200<sup>(1)</sup> | $0 |
|  All Other Fees<sup>(d)</sup> | $0 | $0 |
|  Total: | $819200 | $0 |

---

---

| | | |
|:---|:---|:---|
|  | **2021** | **2021** |
|  | All fees and<br>services to the<br>Trust that were<br>pre-approved | All fees and<br>services to<br>Service Affiliates<sup>(a)</sup><br>that were pre-<br>approved |
|  Audit Fees | $673500 | N/A |
|  Audit Related Fees<sup>(b)</sup> | $0 | $0 |
|  Tax Fees<sup>(c)</sup> | $80600<sup>(1)</sup> | $0 |
|  All Other Fees<sup>(d)</sup> | $0 | $0 |
|  Total: | $754100 | $0 |

---

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##### [**Table of Contents**](#toc)
(1) Amounts relate to tax fees for the review of federal income tax returns, excise tax returns and year end
distribution calculations.

(a) "Service affiliates" as it relates to the aggregate "Audit Fees," "Audit-Related
Fees," "Tax Fees" and "All Other Fees" that were billed by Deloitte for the periods ended October 31, 2022 and October 31, 2021 are Northern Trust Investments, Inc. ("NTI") and entities controlling,
controlled by or under common control with NTI that provide ongoing services to the Registrant.

(b) "Audit-Related Fees" are fees for assurance and related services rendered by Deloitte that are
reasonably related to the performance of the audit or review of the Registrant's financial statements, but not reported as "Audit Fees."

(c) "Tax Fees" are fees for professional services rendered by Deloitte for tax compliance, tax advice and
tax planning.

(d) "All Other Fees" are for products and services provided by Deloitte other than those reported as
Audit, Audit-Related or Tax Fees.

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| | |
|:---|:---|
| (e)(1) | The Registrant's Audit Committee Charter provides that the Audit Committee is responsible for the approval of, prior to the appointment of, the engagement of the principal accountant to annually audit the Registrant's financial statements. The Audit Committee must also pre-approve the engagement of the principal accountant to provide non-audit services to the Registrant, NTI or to any entity controlling, controlled by or under common control with NTI that provides ongoing services to the Registrant, if the engagement has a direct impact on the operations or financial reporting of the Registrant. The pre-approvals may be delegated to a designated representative (or representatives) of the audit committee and such pre-approvals and approvals must be reported to the full Audit Committee at its next meeting. Each designated representative must be a member of the Audit Committee.  |

---

---

| | |
|:---|:---|
| (e)(2) | No percentage of the principal accountant's fees or services were approved pursuant to the waiver provision of paragraph (c)(7)(i)(C) or (c)(7)(ii) of Rule 2-01 of Regulation S-X.  |

---

(f) Not Applicable.

(g) The aggregate non-audit fees and services billed by Deloitte for
services rendered to the Registrant and Service Affiliates for the periods ended October 31, 2022 and October 31, 2021, respectively, were $2,200,436 and $4,875,322.

(h) The Registrant's Audit Committee has considered whether the provision of non-audit services to Service Affiliates, not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, is compatible with maintaining the registered public accountant's independence in performing audit services.

(i) Not Applicable.

(j) Not Applicable.

**Item 5. Audit Committee of Listed Registrants.** 

(a) The Registrant has a separately-designated standing Audit Committee in accordance with Section 3(a)(58)(A)
of the Securities Exchange Act of 1934. All of the Board's independent Trustees, Philip G. Hubbard, Eric T. McKissack and Sarah N. Garvey, are members of the Audit Committee.

(b) Not Applicable.

**Item 6. Investments** 

(a) Schedule I – Investments in Securities of Unaffiliated Issuers.

The complete schedule of investments is included in the report to shareholders in Item 1 of this Form N-CSR.

(b) Securities Divested of in accordance with Section 13(c) of the 1940 Act.

Not Applicable.

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##### [**Table of Contents**](#toc)
**Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.** 

Not Applicable.

**Item 8. Portfolio Managers of Closed-End Management Investment Companies.** 

Not Applicable.

**Item 9. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.** 

Not Applicable.

**Item 10. Submission of Matters to a Vote of Security Holders.** 

There were no material changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees.

**Item 11. Controls and Procedures.** 

(a) The Registrant's principal executive officer and principal financial officer, or persons performing
similar functions, have concluded that the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the 1940 Act are effective, based on the evaluation of these controls and
procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of
1934 as of a date within 90 days of the filing date of this report.

(b) There were no changes in the Registrant's internal control over financial reporting (as defined in Rule
30a - 3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting.

**Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.** 

Not Applicable.

**Item 13. Exhibits.** 

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| | |
|:---|:---|
| (a)(1) | [The code of ethics that is the subject of the disclosure required by Item 2 is attached hereto.](d402077dex9913a1.htm) |
| (a)(2) | [Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.](d402077dex9913a2.htm) |
| (a)(3) | Not Applicable. |
| (a)(4) | There has been no change to the registrant's independent public accountant during the reporting period. |
| (b) | [Certifications required by Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 is attached hereto.](d402077dex9913b.htm) |

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##### [**Table of Contents**](#toc)
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| FlexShares<sup>®</sup> Trust | FlexShares<sup>®</sup> Trust |
| By: | /s/ Peter Ewing |
|  | Peter K. Ewing |
|  | President and Principal Executive Officer |
|  | January 6, 2023 |

---

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

---

| | |
|:---|:---|
| By: | /s/ Peter Ewing |
|  | Peter K. Ewing |
|  | President and Principal Executive Officer |
|  | January 6, 2023 |
| By: | /s/ Randal Rein |
|  | Randal E. Rein |
|  | Treasurer and Principal Financial Officer |
|  | January 6, 2023 |

---

## Exhibit 99.13

**FLEXSHARES FUNDS** 

**CODE OF ETHICS FOR PRINCIPAL EXECUTIVE,** 

**FINANCIAL AND ACCOUNTING OFFICERS** 

**I.** **Covered Officers/Purpose of the Code** 

This Code of Ethics (the "Code") applies to the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer or persons performing similar functions (the "Covered Officers") of the FlexShares Funds and each separate investment portfolio thereof (each a "Fund" and collectively the "Funds") for the purpose of promoting:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between
personal and professional relationships;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• full, fair, accurate, timely and understandable disclosure in reports and documents that a Fund files with, or
submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• compliance with applicable laws and governmental rules and regulations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the prompt internal reporting of violations of this Code to an appropriate person or persons identified in this
Code; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• accountability for adherence to this Code.

Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.

**II.** **Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest** 

**Overview.** A "conflict of interest" occurs when a Covered Officer's private interest interferes with the interests of, or his or her service to, the Funds. For example, a conflict of interest would arise if a Covered Officer, or a member of his or her family, receives improper personal benefits as a result of his or her position with the Funds.

Certain conflicts of interest arise out of the relationships between Covered Officers and the Funds and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Funds because of their status as "affiliated persons" of the Funds. The compliance programs and

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procedures of the Funds and their investment advisers are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.

Each of the Covered Officers is also an officer and employee of the Funds' investment adviser, Northern Trust Investments, N.A., and/or its affiliates (collectively, "Northern Trust"). Although typically not presenting an opportunity for improper personal benefit, conflicts arise from the contractual relationships between the Funds and Northern Trust. This Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Funds or for Northern Trust, or for both), be involved in establishing policies and implementing decisions that will have different effects on Northern Trust and the Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Funds and Northern Trust and is consistent with the performance by the Covered Officers of their duties as officers of the Funds. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, the Funds' Boards of Trustees (the "Board") recognize that the Covered Officers may also be officers of one or more other investment companies covered by this Code or other codes.

Other conflicts of interest are covered by this Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under this Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Funds.

**General Principles.** Each Covered Officer must:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• not use his or her personal influence or personal relationships improperly to influence investment decisions or
financial reporting by the Funds whereby the Covered Officer would benefit personally to the detriment of the Funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• not cause the Funds to take action, or fail to take action, for the individual personal benefit of the Covered
Officer rather than the benefit of the Funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• not use material non-public information of portfolio transactions made or
contemplated for the Funds to trade personally or cause others to trade personally in contemplation of the market effect of such transactions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• not retaliate against any other Covered Officer or any other persons for reports of potential violations that are
made in good faith.

**Specific Policies**. In addition to the general principles set forth above, certain potential conflict situations are subject to the specific policies set forth below.

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*Outside Director or Officer Positions*. A Covered Officer may not become a director, officer, partner, sole proprietor, consultant or controlling stockholder of a business entity (other than the Funds or Northern Trust) without the approval of Northern Trust. A Covered Officer may act as an uncompensated officer, director, trustee or committee member of a civic, social, philanthropic, charitable, educational or religious organization consistent with any policy on charitable and community activities established from time to time by Northern Trust.

*Outside Employment for Compensation*. A Covered Officer may not accept employment by a depository institution, trust company, investment adviser, securities dealer, investment bank or underwriter (in each case other than Northern Trust). Except for the foregoing and as otherwise provided in this Code, a Covered Officer may accept employment or render services to others for compensation (including engagements for teaching, speaking and writing books or articles) only with the approval of Northern Trust.

*Service as a Governmental or Quasi-Governmental Official.* A Covered Officer may not serve as an elected or appointed official of a government or quasi-governmental agency, whether federal, state, local or foreign, including village boards, school boards or zoning boards, without the approval of Northern Trust.

*Meals, Entertainment and Travel Arrangements*. A Covered Officer may not accept any meals, entertainment or travel arrangements from any company having current or prospective business dealings with the Funds or Northern Trust that are not business-related or that may be inconsistent with any policy on meals, entertainment or travel arrangements established by Northern Trust from time to time.

*Gifts Other than Business-Related Meals, Entertainment and Travel Arrangements.* A Covered Officer may not accept any non-nominal gifts from any company having current or prospective business dealings with the Funds or Northern Trust that may be inconsistent with any policy on gifts established by Northern Trust from time to time.

*Relationships with Service Providers.* A Covered Officer may not invest in any of the Funds' service providers or vendors (other than Northern Trust) without the approval of Northern Trust unless (a) the service provider or vendor is publicly held, (b) the Covered Officer's ownership interest and those of his or her immediate family represent in the aggregate less than a 1% equity interest in the service provider or vendor, and (c) the Funds' relationship is not material to the service provider or vendor. No Covered Officer may accept a loan from any of the Funds' service providers or vendors (other than Northern Trust), except for credit transactions on regular terms from firms whose regular business includes lending or the extension of credit.

*Political Activities and Contributions.* A Covered Officer may not allow explicit or implicit disclosure of his or her affiliation with the Funds or Northern Trust in connection with a political campaign for a candidate. A Covered Officer may not make contributions or expenditures on behalf of the Funds in connection with any political campaign, election or other political activity.

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*Financial Interest in Commissions.* A Covered Officer may not have a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership.

For purposes of the foregoing policies, the "approval of Northern Trust" shall mean the approval of the person or persons authorized to grant such approvals under any policies governing standards of conduct established by Northern Trust from time to time.

**III.** **Disclosure and Compliance** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Each Covered Officer should familiarize himself or herself with the disclosure requirements generally applicable
to the Funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to
others, whether within or outside the Funds, including to the Funds' trustees and auditors, and to governmental regulators and self-regulatory organizations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with
other officers and employees of the Funds and Northern Trust and take other appropriate steps with the goal of promoting full, fair, accurate and timely disclosure in the reports and documents that the Funds file with, or submit to, the SEC and that
are signed or certified by him or her; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions
imposed by applicable laws, rules and regulations.

**IV.** **Reporting and Accountability** 

Each Covered Officer must:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• upon adoption of this Code (or thereafter as applicable, upon becoming a Covered Officer), affirm in writing to
the Board that he or she has received, read, and understands this Code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• annually thereafter affirm to the Board that he or she has complied with the requirements of this Code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• notify such legal or compliance officer(s) or member(s) of the Board as the Board may designate for such purpose
(the "Compliance Designee") if the Covered Officer knows of any violation of this Code, it being a violation of this Code to fail to do so;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• notify the Compliance Designee and the Board (or a committee thereof) on a periodic basis (but not less
frequently than annually) if the Covered Officer has received, at any time during the period, any approval of Northern Trust contemplated by the Specific Policies set forth in Section II above; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• complete and certify at least annually the Funds' "Annual Management Trustees and Officers
Questionnaire" as well as Northern Trust's "Outside Connections and Ownership Interests" report or such other questionnaires and reports as the Board may request.

The Funds' Compliance Designee is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. However, any waivers sought by a Covered Officer will be considered by the Board's Audit Committee or such other committee of the Board as the Board may designate for such purpose (the "Committee").

Each Fund will follow these procedures in investigating and enforcing this Code:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Fund's Compliance Designee will take all appropriate action to investigate any potential violations
reported to him or her;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• if, after such investigation, the Fund's Compliance Designee believes that no violation has occurred, he or
she is not required to take any further action;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any matter that the Fund's Compliance Designee believes is a violation will be reported to the Committee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• if the Committee concurs that a violation has occurred, it will inform and make a recommendation to the Board,
which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of Northern Trust or its board; or a recommendation to dismiss the
Covered Officer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Committee will be responsible for granting waivers, as appropriate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules.

**V.** **Other Policies and Procedures** 

This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. The code of ethics adopted by the Funds, the investment adviser and the principal underwriter under Rule 17j-1 under the Investment Company Act are separate requirements applying to the Covered Officers and others, and are not part of this Code.

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**VI.** **Amendments** 

Any amendments to this Code must be approved or ratified by a majority vote of the Board, including a majority of independent directors.

**VII.** **Confidentiality** 

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than each Company and its counsel, investment advisers, principal underwriters, administrators and custodians.

**VIII.** **Internal Use** 

This Code is intended solely for the internal use by the Funds. This Code is a statement of certain fundamental principles, polices and procedures that govern the Covered Officers in the conduct of the Funds' business. It is not intended to and does not create any rights in any employee, investor, supplier, competitor, shareholder or any other person.

Date: July 2011

## Exhibit 99.13

CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE INVESTMENT COMPANY ACT OF 1940 AND

SECTION 302 OF THE SARBANES OXLEY ACT OF 2002:

I, Peter K. Ewing certify that:

1. I have reviewed this report on Form N-CSR of FlexShares<sup>®</sup> Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the
periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that
occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and
the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant's internal control over financial reporting.

---

| | | | |
|:---|:---|:---|:---|
| Date: | January 6, 2023 | By: | /s/ Peter Ewing |
|  |  |  | Peter K. Ewing |
|  |  |  | President and Principal Executive Officer |

---

------

CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE INVESTMENT COMPANY ACT OF 1940 AND

SECTION 302 OF THE SARBANES OXLEY ACT OF 2002:

I, Randal Rein, certify that:

1. I have reviewed this report on Form N-CSR of FlexShares<sup>®</sup> Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the
periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that
occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and
the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant's internal control over financial reporting.

---

| | | | |
|:---|:---|:---|:---|
| Date: | January 6, 2023 | By: | /s/ Randal Rein |
|  |  |  | Randal Rein |
|  |  |  | Treasurer and Principal Financial Officer |

---

## Exhibit 99.13

**Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code)** 

In connection with the attached Report of FlexShares<sup>®</sup> Trust (the "Trust") on Form N-CSR to be filed with the Securities and Exchange Commission (the "Report"), each of the undersigned officers of the Trust does hereby certify that, to the best of such officer's knowledge:

1. The Report fully complies with the requirements of 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and
results of operations of the Trust as of, and for, the periods presented in the Report.

Dated: January 6, 2023

---

| | |
|:---|:---|
| By: | /s/ Peter Ewing |
|  | Peter K. Ewing |
|  | President and Principal Executive Officer |
| By: | /s/ Randal Rein |
|  | Randal Rein |
|  | Treasurer and Principal Financial Officer |

---

A signed original of this written statement required by Section 906 has been provided to the Trust and will be retained by the Trust and furnished to the Securities and Exchange Commission or its staff upon request.