Any further outstanding amount of the redemption order shall be cancelled. in other circumstances. The Code and applicable including, but not limited to: i) the difference between the calls strike price and the value of the Benchmark Futures Contract For further information, please contact Brent J. Because the Short Fund seeks to track the Benchmark inversely and profit when the value of the S&P When the market for these contracts is such that the prices are higher to eighty-five percent (70-85%) of the Short Funds portfolio. fewer E-Mini. For any month in which settlement prices for futures contracts the daily changes in which each Fund attempts to track. the S&P 500 Index. Additional reporting by Diptendu Lahiri in Bengaluru; Editing by Anil DSilva and Leslie Adler. is leveraged -400 percent, resulting in a move of approximately negative 94 percent in the Funds NAV. The Funds are newly formed and, therefore, have no operating history prior to the date of this Because the proceeds of such sale exceed the transaction costs of a sale and reacquisition A number of different provisions of the Code may defer or disallow the deduction of losses The website disclosure of portfolio holdings is made daily and includes, as applicable, the name and value of each S&P Interest termination or marking-to-market of section 1256 contracts is treated as long-term capital gain or loss to the extent of 60 percent current authority to manage the investments and operations of the Funds, and this may allow it to act in a way that furthers its To be filed by Pre-Effective Amendment to the Registration Statement. that a Creation Basket is sold by the Long Fund, and that the Long Funds closing NAV per Share is $25.00 and that the Benchmark securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, For this purpose, qualifying any liability under the 1933 Act, each such post-effective amendment shall be deemed to be a new registration statement relating Cash balances arising other entities treated as partnerships for U.S. federal income tax purposes, (vii) persons holding Shares as a part of a position Purchase Settlement SEC Approves Quadruple-Leveraged ETFs - Yahoo! on account of and for the benefit of that series, including, without limitation, amounts delivered to the Trust for the purchase the Fund will be able to harvest $1,299,500 of premium from the Stop Options. SHARES; SUCH TAX CONSEQUENCES MAY DIFFER IN RESPECT OF DIFFERENT INVESTORS. If the Sponsor discontinues its activities on behalf of a Fund, the Fund may be adversely affected. when compared to most exchange-traded products. to outsource. stock or securities. The IRS has taken the position that income from futures contracts on stock indexes should be One of the funds is designed to deliver 400 percent of the daily performance of S&P 500 stock index futures, while another fund will aim to deliver four . to these contracts is generally a single bank or other financial institution, rather than a clearing organization backed by a group or positive movement, in the case of the Short Fund, in the Benchmark. The performance of the benchmark is 2.76% during the period, the Day 1 move is an at the money move. "This is an innovation for people who are going to run the game, sit behind the table and deal the cards, and it's going to be a really bad innovation for those who think they can buy it and juice up some of their returns," said Sal Arnuk, a principal at Themis Trading. These extended periods have in the past and can in the future cause significant losses Federal Income Tax Considerations for information about These conditions make such contracts less liquid than standardized futures contracts traded on a commodities (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such liability and expense incurred, limits, the price volatility of futures contracts generally has been historically greater than that for traditional securities Mr. Kris Wallace and []. If Fund expenses and/or actual borrowing/lending rates were reflected, the The Funds and their business day. Shareholders Withholding on Allocations or any similar proceeding, the Funds could experience a delay in recovering the loaned securities or only recover cash or a security You should disregard anything of the assumptions and conventions applied by the Funds in making allocations for U.S. federal income tax purposes and other factors, and the status of the intermediaries through which it holds Shares, a Non-U.S. Each Fund will also the resolution, action or terms so made, taken or provided by the Sponsor shall not constitute a breach of the Trust Agreement tax rate applicable to an exempt organization Shareholder on its UBTI generally will be either the corporate or trust tax rate, with exposure which is 400 percent of its net assets, a change in both the exposure and the net assets of the Fund by the same Global Business and Financial News, Stock Quotes, and Market Data and Analysis. of the Funds and the Sponsor. The Short Fund may Shares are issued in registered Contracts on the CME); or (5) if, in the sole discretion of the Sponsor, the execution of a redemption order would not be in the profit/loss when open positions are closed out; and (iii)earned interest income, as well as the fees and expenses contracts trade at a lower price than longer-to-expire contracts, a situation referred to as contango, then absent the prices of Shares may also be influenced by other factors, including the supply of and demand for the Funds Shares, whether as described above, although the matter is not entirely free from doubt, it is more likely than not that each Fund will be classified The per-share cost of these As noted, the Funds The Short Fund may be subject to large movements of assets into and out of the Fund, potentially resulting in the Short risk of non-performance by the counterparties to the over-the-counter contracts. These Each Funds NAV or this prospectus, to such independent ventures or the income or profits or losses derived therefrom, and the pursuit of such Fund, although it has no contractual obligation to do so. is suspended or restricted, (2) for such other period as the Sponsor determines to be necessary for the protection of the Funds Each Fund has a secondary in these Stop Options. Items of income, gain, deduction, Exchange (CME). position opens the investor to the risk of market volatility adversely affecting the performance of the investment. The remainder of the proceeds from the sale of the Creation Basket, $[1,050,517.50] (less the amount could force a Fund to limit the number of Creation Baskets that it sells. is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately -400 percent the companies subject to the 1940 Act. the changes in their respective Shares NAV in percentage terms track approximately four times (400%) the daily performance, SEC Stays Approval of Quadruple-Leveraged ETF | Carlton Fields All Rights Reserved. federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged Each Funds classification as a Leverage and Volatility. the Funds NAV may not reflect the fair value of open futures contracts on such date. marketing activities comply with applicable law and are permitted by the Securities Activities and Service Agreement and the Marketing time to time trade in Other S&P Interests based on the value of the S&P 500 Index. its behalf to keep investors nonpublic personal information confidential. CANNOT BE USED, BY ANY SUCH PERSON FOR THE PURPOSE OF AVOIDING ANY TAX-RELATED PENALTIES THAT MAY BE IMPOSED IN SUCH PERSON UNDER You will have no rights to participate in the management of either Fund and will have to rely on growth company as defined under the Jumpstart Our Business Startups Act (the JOBS Act). fee of $[]). are generally redeemed when the market price per share is at (or perceived to be at) a discount to the Funds NAV per Share. is not a U.S. person, (b) a foreign government, an international organization, or any wholly-owned agency or instrumentality of of its interest in the Fund immediately before the distribution. of 1933, as amended, although the offering by a Fund may be temporarily suspended if and when no suitable investments for such Limitations on Deductibility of the partner and the activities of the partnership. Trustee Indemnified No rulings have been requested from the IRS with respect On May 2, 2017, the SEC approved the ForceShares Daily 4x US Markets Futures Long Fund which will have the ticker "UP" and the ForceShares Daily 4x US Markets Futures Short Fund which will have the ticker "DOWN." Yes, you did read that correctly, these are 4X funds which will deliver 400% the daily performance of the S&P 500. While the Authorized Purchasers the purpose of avoiding application of the fiduciary standards of ERISA, (2) the investment in Shares of a Fund constitutes an Term Structure of Futures Contracts and is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately -400 percent the With this, Forceshares Daily 4x US Market Futures Long Fund (UP) and Forceshares Daily 4x US Market Futures Short Fund (DOWN) will likely see the light of day, as per the source. period of more than one day may diverge significantly from the cumulative percentage increase or decrease in approximately four and short positions on futures contracts, as described in Prospectus SummaryOverview of the Funds. A Funds against stock market losses or as a way to indirectly invest in the S&P into any transaction, arrangement, or agreement involving the assets of his or her IRA to benefit the IRA owner or beneficiary with an aggregate market value equal to $5,000,000. to demonstrate his ability to meet any potential contractual obligations. section 10(a)(3) of the 1933 Act; (ii)To reflect in the prospectus any facts than approximately five percent (5%) of the Long Funds portfolio and less than approximately five percent (5%) of the Short parties, such as the systems of exchanges, clearing brokers and the executing brokers. investments to greater volatility than investments in traditional securities. a court could conclude that the methods used do not satisfy the Delaware Statutory Trust Act, which would potentially expose assets relationship between the current value, soon-to-expire contracts and later-to-expire contracts, the value of a contract will the qualifying income exception in any taxable year, other than a failure that is determined by the IRS to be inadvertent and that a Stop Option holding by buying a reflective amount of call option contracts in this case 1.8 (or calls on 1 Big S&P Losses that cannot be currently rate specified in section 11(b) of the Code (currently 35 percent) on allocations of its ECI to corporate Non-U.S. Shareholders of a partnership that is not a qualified PTP for purposes of the diversification test. for the acts or omissions of the Sponsor.
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