KraneShares SSE STAR Market 50 Index ETF

Ticker: KSTR

Exchange: NYSE Arca

Expense ratio: 0.89%

Original filing date: May 07, 2020

Effective date: January 22, 2021

Listing Date: January 28, 2021

CUSIP: 500767694

 

Active: No

Index: SSE Science and Technology Innovation Board 50 Index

Investment Objective: The KraneShares SSE STAR Market 50 Index ETF seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of a specific equity securities index. The Fund’s current index is the SSE Science and Technology Innovation Board 50 Index.

Investment Strategy: The SSE STAR Market is a new listing exchange run by the Shanghai Stock Exchange that focuses on Chinese science and technology companies. According to the Shanghai Stock Exchange, companies listed on the SSE STAR Market are mainly from high-tech and strategic emerging industries, and most focus on next-generation information technology, biomedicine, high-end equipment and other industries.

Constituents: 50

 

Adviser: Krane Funds Advisors, LLC

Sub-Adviser: Bosera Asset Management (International) Co., Ltd.

 

Prospectus is here and here.

Product page: https://kraneshares.com/kstr/

http://www.csindex.com.cn/en/indices/index-detail/000688

https://www.sec.gov/Archives/edgar/data/1547576/000182912621000087/kraneshares-kstr_497k.htm

https://www.sec.gov/Archives/edgar/data/1547576/000121390020019102/s126467_485bpos.htm

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Principal Investment Strategies

Under normal circumstances, the Fund will invest at least 80% of its total assets in components of the Underlying Index and depositary receipts, including American depositary receipts, representing such components. The Underlying Index includes the stocks and depositary receipts of the top 50 companies by free-float market capitalizations that are listed on the SSE Science and Technology Innovation Board. The SSE Science and Technology Innovation Board is a new listing exchange run by the Shanghai Stock Exchange that focuses on Chinese science and technology companies. According to the Shanghai Stock Exchange, companies listed on the SSE Science and Technology Innovation Board are mainly from high-tech and strategic emerging industries, and most focus on next-generation information technology, biomedicine, high-end equipment and other industries.

The Underlying Index components are weighted based on their free-float market capitalizations, subject to a 10% cap on any particular component. The Underlying Index may include less than 50 components if there are an insufficient number of eligible stocks and depositary receipts, but will include no fewer than 30 components. Components eligible for inclusion in the Underlying Index must meet certain market capitalization and liquidity screens and have been trading for at least 11 days.

The stocks included in the Underlying Index will consist of China A-Shares. China A-Shares are Chinese renminbi (“RMB”)-denominated equity securities (“A-Shares”) issued by companies incorporated in mainland China. Direct investments in A-Shares are currently possible only through the trading and clearing facilities of a participating exchange located outside of mainland China (“Stock Connect Programs”) or Renminbi Qualified Foreign Institutional Investor (“RQFII”) or Qualified Foreign Institutional Investor (“QFII”) license. Bosera Asset Management (International) Co., Ltd. (“Bosera”), the Fund’s sub-adviser, has received a license as a RQFII from the China Securities Regulatory Commission (“CSRC”) and has received an A-Shares quota by China’s State Administration of Foreign Exchange (“SAFE”) for use by the investment products it manages, including the Fund. Bosera, on behalf of the investment products it manages, may invest in A-Shares and other permitted China securities up to the relevant A-Shares quota(s). In addition, the Fund may invest in A-Shares through the Stock Connect Programs and, in the future, Bosera may also obtain a license on behalf of the Fund as a QFII, another program under Chinese law that would allow the Fund to invest in A-Shares.

The Fund may invest up to 20% of its assets in instruments that are not included in the Underlying Index, but that the Fund’s investment adviser, Krane Funds Advisors, LLC (“Krane” or “Adviser”) and/or Bosera believes will help the Fund track the Underlying Index. These investments may include equity securities and depositary receipts of issuers whose securities are not components of the Underlying Index, derivative instruments (including swaps, futures, forwards, structured notes and options), other investment companies (including exchange traded funds or “ETFs”) and cash or cash equivalents (including money market funds). Certain other investment companies in which the Fund may invest may be advised, sponsored or otherwise serviced by Krane, Bosera and/or their affiliates. The Fund will not purchase shares of an investment company if it would cause the Fund to (i) own more than 3% of such investment company’s voting shares; (ii) invest more than 5% of its total assets in such investment company; or (iii) invest more than 10% of its total assets in investment companies.

In addition to China A-Shares, which are described above, the following China-related securities may be included in this 20% basket:

•   China B Shares, which are shares of companies listed on the Shanghai or Shenzhen Stock Exchange but quoted and traded in foreign currencies (such as Hong Kong Dollars or U.S. Dollars), which were primarily created for trading by foreign investors.

•   China H Shares, which are shares of companies incorporated in mainland China and listed on the Hong Kong Stock Exchange (“H-Shares”), where they are traded in Hong Kong dollars and may be traded by foreign investors.

•   China N Shares, which are shares of companies with business operations in mainland China and listed on an American stock exchange, such as NYSE or NASDAQ (“N-Shares”).

•   P-Chips, which are shares of private sector companies with a majority of their business operations in mainland China and controlling private Chinese shareholders, which are incorporated outside of mainland China and traded on the Hong Kong Stock Exchange in Hong Kong dollars.

•   Red Chips, which are shares of companies with a majority of their business operations in mainland China and controlled by the central, provincial or municipal governments of the PRC, whose shares are traded on the Hong Kong Stock Exchange in Hong Kong dollars.

•   S-Chips, which are shares of companies with business operations in mainland China and listed on the Singapore Exchange. S-Chip shares are issued by companies incorporated anywhere, but many are registered in Singapore, the British Virgin Islands, the Cayman Islands, or Bermuda.

Although the Fund reserves the right to replicate (or hold all components of) the Underlying Index, the Fund expects to use representative sampling to track the Underlying Index. “Representative sampling” is a strategy that involves investing in a representative sample of securities that collectively have an investment profile similar to the Underlying Index.

The Underlying Index launched only recently prior to the date of this prospectus so information about it is not available as of May 31, 2020. The Underlying Index is rebalanced quarterly.

The Fund is non-diversified. To the extent the Underlying Index is concentrated in a particular industry, the Fund is expected to be concentrated in that industry.

The Fund may engage in securities lending.

DEMOCRACY INTERNATIONAL FUND

Tracks an index that bases constituent company weightings on the Economist's Democracy Score.

Ticker: DMCY

Exchange: NYSE Arca

Expense ratio: 0.50%

Original filing date: January 14, 2021

Effective date: March 30, 2021

Listing Date: April 1, 2021

CUSIP: 00774Q148

Active: No

Index: Democracy Investments International Index

Investment Objective: The Democracy International Fund seeks to track the total return performance, before fees and expenses, of the Democracy Investments International Index.

Investment Strategy: Based on the Economist's (the international news group) Intelligence Unit's Democracy Index.

• 2,400 companies: Across 52 countries where each country is assigned an Economist Democracy Score, on a scale of 1-10.
• Market cap of each company is multiplied times their country Democracy Score to get a "Democracy market cap".
• "All Democracy market caps" are added together.
• Each company's Democracy market cap is divided by the sum of the Democracy market caps to derive each company's percentage of the total.
• This percentage is their weight in the Democracy International Index.

Constituents: Universe: Solactive GBS Global Markets ex United States Large & Mid Cap USD Index
 
Adviser: Democracy Investment Management, LLC

Sub-Adviser: Vident Investment Advisory, LLC
 
Prospectus is here.
 

Main Portfolio Manager: Christopher Browne

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Principal Investment Strategies

 

The Fund uses a “passive management” (or indexing) approach in seeking to achieve its investment objective. The Index construction process begins with the universe of companies that are current members of the Solactive GBS Global Markets ex United States Large & Mid Cap USD Index (market cap weighted, international equities) (the “Solactive Index”). 

The Solactive Index consists of over 2,400 individual companies representing 52 countries. Democracy Investments Index Provider LLC (the “Index Provider”) assigns a “country of risk” to each company in the Solactive Index universe based on the country of risk assigned to each such company by Bloomberg L.P. A company’s country of risk designation is based on a number of criteria, including the country in which the company is domiciled, the primary stock exchange on which the company’s shares trade, the location from which the majority of the company’s revenues are generated, and the company’s reporting currency.

 

The Index Provider then matches each company’s country of risk against that country’s “Democracy Score” assigned by The Economist Intelligence Unit Ltd.’s Democracy Index. A country’s Democracy Score can range from 0-10 and is a composite of sixty indicators, which are grouped into the following five categories:

 

1.

Electoral process and pluralism

2.

Civil liberties

3.

The functioning of government

4.

Political participation

5.

Political culture

 

The Index Provider then multiplies each company’s market capitalization weighting in the Solactive Index by the Democracy Score of its country of risk and normalizes the products to sum to 100%. In other words, the weight of a specific company in the Index is the product of the company’s Democracy Score and its market capitalization weighting in the Solactive Index (the “Market Capitalization Product”) divided by the sum of all the Market Capitalization Products of all companies in the Index. As a result, the Index has greater weightings in companies in countries with higher Democracy Scores and lesser weightings in companies in countries with lower Democracy Scores as compared to the Solactive Index. The Index is rebalanced and reconstituted on a quarterly basis.

 

In constructing the Fund’s portfolio, Democracy Investment Management, LLC (the “Adviser”), the Fund’s investment adviser and an affiliate of the Index Provider, generally will use a representative sampling investment approach designed to achieve the Fund’s investment objective. In doing so, the Fund generally will hold (i) the securities of index constituents, consisting of common stocks and American Depositary Receipts (“ADRs”) of large- and medium-capitalization companies, and (ii) shares of exchange traded funds (“ETFs”), in combination such that the Fund’s returns are expected to correspond generally to the Index’s returns, country and sector weightings, and other characteristics such as market capitalization. The Adviser’s use of ETFs as part of its representative sampling strategy will result in the Fund (i) having exposure to companies that have the same country of risk designation as companies in the Index but that are not themselves Index constituents, and (ii) not owning or otherwise not having exposure to companies that are included in the Index. At times, ETFs may represent a significant portion of the Fund’s portfolio.

 

In addition to investing in ETFs as discussed above, the Fund also may invest in securities or other investments not included in the Index, but which the Adviser believes will help the Fund to track the Index. For example, the Fund may invest in securities that are not components of the Index so as to reflect various corporate actions and other changes to the Index (such as Index reconstitutions, additions, and deletions).

 

[The Fund may from time to time invest a significant portion of its assets in the securities of companies in one or more countries, geographic regions or economic sectors. As of the date of this Prospectus, the Fund has significant exposure to the [____] sector, as defined by [____].]

Global X Clean Water ETF

Ticker: TBD
Exchange: TBD
Expense ratio: TBD

Original filing date: January 14, 2021
Effective date: March 30, 2021
Listing Date: TBD
CUSIP: TBD
Active: No
Index: Solactive Global Clean Water Index

Investment Strategy:

Exchange-listed companies expected to benefit from further advances in the provision of clean water, including companies whose principal business (derive at least 50% of their revenues from clean water) is in:

• water treatment
• recycling (including water reclamation)
• purification
• desalination
• storage
• distribution

Constituents: TBD

 
Adviser: Global X Management Company LLC.
Sub-Adviser: N/A
 
Prospectus is here.

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PRINCIPAL INVESTMENT STRATEGIES

The Fund invests at least 80% of its total assets, plus borrowings for investments purposes (if any), in the securities of the Underlying Index and in American Depositary Receipts ("ADRs") and Global Depositary Receipts ("GDRs") based on the securities in the Underlying Index. The Fund's 80% investment policy is non-fundamental and requires 60 days prior written notice to shareholders before it can be changed.

The Underlying Index is designed to provide exposure to exchange-listed companies expected to benefit from further advances in the provision of clean water, including, but not limited to, companies whose principal business is in water treatment, recycling (including water reclamation), purification, desalination, storage, distribution, and/or sustainability (collectively, "Clean Water Companies"), as defined by Solactive AG, the provider of the Underlying Index ("Index Provider").

In constructing the Underlying Index, the Index Provider first applies a proprietary natural language processing algorithm to the eligible universe, which seeks to identify and rank companies involved in the provision of clean water based on filings, disclosures and other public information (e.g. regulatory filings, earnings transcripts, etc.). The Index Provider also applies an ESG (environmental, social and governance) screening process to the universe of eligible companies. The highest-ranking companies identified by the natural language processing algorithm, as of the selection date, are further reviewed by the Index Provider to confirm they derive at least 50% of their revenues from the provision of clean water. To be eligible for the Underlying Index, a company is considered by the Index Provider to be a Clean Water Company if the company generates at least 50% of its revenues from developing technologies, services, and/or equipment relating to water treatment, recycling (including water reclamation), purification, desalination, storage, distribution, and/or sustainability, as determined by the Index Provider.

To be a part of the eligible universe of the Underlying Index, certain minimum market capitalization and liquidity criteria, as defined by the Index Provider, must be met. As of [ ], companies must have a minimum market capitalization of $[ ] million and a minimum average daily turnover for the last [ ] months greater than or equal to $[ ] million in order to be eligible for inclusion in the Underlying Index. As of [ ], companies listed in the following countries were eligible for inclusion in the Underlying Index: [ ].

The Underlying Index is weighted according to a modified capitalization weighting methodology and is reconstituted and re-weighted semi-annually. Modified capitalization weighting seeks to weight constituents primarily based on market capitalization, but subject to caps on the weights of the individual securities. During each rebalance, the maximum weight of a company is capped at [ ]%, the aggregate weight of companies with a weight greater than or equal to [ ]% is capped at [ ]%, and all remaining companies are capped at a weight of [ ]%, and all constituents are subject to a minimum weight of [ ]%. Generally speaking, this approach will limit the amount of concentration in the largest market capitalization companies and increase company-level diversification. The Underlying Index may include large-, mid- or small-capitalization companies, and components primarily include [ ] and [ ] companies. As of [ ], 2021, the Underlying Index had [ ] constituents. The Fund's investment objective and Underlying Index may be changed without shareholder approval.

The Underlying Index is sponsored by the Index Provider, which is an organization that is independent of the Fund and Global X Management Company LLC, the investment adviser for the Fund ("Adviser"). The Index Provider determines the relative weightings of the securities in the Underlying Index and publishes information regarding the market value of the Underlying Index.

The Adviser uses a "passive" or indexing approach to try to achieve the Fund's investment objective. Unlike many investment companies, the Fund does not try to outperform the Underlying Index and does not seek temporary defensive positions when markets decline or appear overvalued.

The Fund generally will use a replication strategy. A replication strategy is an indexing strategy that involves investing in the securities of the Underlying Index in approximately the same proportions as in the Underlying Index. However, the Fund may utilize a representative sampling strategy with respect to the Underlying Index when a replication strategy might be detrimental or disadvantageous to shareholders, such as when there are practical difficulties or substantial costs involved in compiling a portfolio of equity securities to replicate the Underlying Index, in instances in which a security in the Underlying Index becomes temporarily illiquid, unavailable or less liquid, or as a result of legal restrictions or limitations (such as tax diversification requirements) that apply to the Fund but not the Underlying Index.

The Adviser expects that, over time, the correlation between the Fund's performance and that of the Underlying Index, before fees and expenses, will exceed 95%. A correlation percentage of 100% would indicate perfect correlation. If the Fund uses a replication strategy, it can be expected to have greater correlation to the Underlying Index than if it uses a representative sampling strategy.

The Fund concentrates its investments (i.e., holds 25% or more of its total assets) in a particular industry or group of industries to approximately the same extent that the Underlying Index is concentrated. As of [ ], 2021, the Underlying Index was concentrated in the [ ] industry and had significant exposure to the [ ] sector.

ARK Space Exploration ETF

Ticker: ARKX
Exchange: TBD
Expense ratio:  TBD
Original filing date: January 13, 2021
Effective date: March 29, 2021
Listing Date:  TBD
CUSIP: 00214Q807
 
Active: Yes   
Index: Not applicable
Investment Objective: The ARK Space Exploration ETF’s investment objective is long-term growth of capital.

Investment Strategy: 

Top-down and bottom-up analysis to identify companies with disruptive innovation in following categories:

• Orbital Aerospace Companies
• Suborbital Aerospace Companies
• Enabling Technologies Companies
• Aerospace Beneficiary Companies

Constituents: 40-55

 
Adviser: ARK Investment Management LLC
Sub-Adviser: Not applicable.
 
Prospectus is here.

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Principal Investment Strategies

 

The Fund is an actively-managed exchange-traded fund (“ETF”) that will invest under normal circumstances primarily (at least 80% of its assets) in domestic and foreign equity securities of companies that are engaged in the Fund’s investment theme of Space Exploration and innovation. The Adviser defines “Space Exploration” as leading, enabling, or benefitting from technologically enabled products and/or services that occur beyond the surface of the Earth.

 

In selecting companies that the Adviser believes are engaged in the theme of Space Exploration (“Space Exploration Companies”), the Adviser seeks to identify, using its own internal research and analysis, companies capitalizing on disruptive innovation. The Adviser defines “disruptive innovation” as the introduction of a technologically enabled new product or service that the Adviser expects to change an industry landscape. The Adviser’s internal research and analysis leverages insights from diverse sources, including external research, to develop and refine its investment themes and identify and take advantage of trends that have ramifications for individual companies or entire industries.

 

The Adviser believes that Space Exploration Companies can be grouped into four overarching categories, each of which contains relevant sub-elements. Orbital Aerospace Companies are companies that launch, make, service, or operate platforms in the orbital space, including satellites and launch vehicles. Suborbital Aerospace Companies are companies that launch, make, service, or operate platforms in the suborbital space, including drones, air taxis and electric aviation vehicles. Enabling Technologies Companies are companies that create the technologies required for successful value-add aerospace operations, including artificial intelligence, robotics, 3D printing, materials and energy storage. Aerospace Beneficiary Companies are companies that stand to benefit from aerospace activities, including agriculture, internet access, global positioning system (GPS), construction and imaging. Space exploration is possible due to the convergence of a number of themes, and a Space Exploration Company may not currently derive any revenue, and there is no assurance that such company will derive any revenue from innovative technologies in the future.

 

The Adviser will select investments for the Fund that represent the Adviser’s highest-conviction investment ideas within the theme of Space Exploration, i.e., investment decisions regarded with confidence, in constructing the Fund’s portfolio. The Adviser will analyze potential investments by using both “top down” information (e.g., economy-wide analysis of facts such as rate of growth, cost declines, unit economics, sizing of markets, and price levels as well as business and technology cycle trends) and “bottom up” criteria (e.g., fundamental and quantitative metrics for individual companies such as their revenue growth, profitability and return on invested capital). Based upon its research and analysis, the Adviser will select a portfolio company that it believes presents the best risk-reward opportunities. [In both the Adviser’s “top down” and “bottom up” approaches, the Adviser evaluates environmental, social, and governance (“ESG”) considerations. In its “top down” approach, the Adviser uses the framework of the United Nations Sustainable Development Goals to integrate ESG considerations into its research and investment process. The Adviser, however, does not use ESG considerations to limit, restrict or otherwise exclude companies or sectors from the Fund’s investment universe. In its “bottom up” approach, the Adviser makes its investment decisions primarily based on its analysis of the potential of individual companies, while integrating ESG considerations into that process. The Adviser’s highest-conviction investment ideas are those that it believes present the best risk-reward opportunities.]

 

Under normal circumstances, substantially all of the Fund’s assets will be invested in equity securities, including common stocks, partnership interests, business trust shares and other equity investments or ownership interests in business enterprises. The Fund’s investments will include micro-, small-, medium- and large-capitalization companies. The Fund’s investments in foreign equity securities will be in both developed and emerging markets. The Fund may invest in foreign securities (including investments in American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”)) and securities listed on local foreign exchanges.

 

The Fund is classified as a “non-diversified” investment company under the Investment Company Act of 1940, as amended (the “1940 Act”), which means that it may invest a high percentage of its assets in a limited number of issuers. The Fund’s portfolio is expected to contain 40 to 55 common stocks (domestic and ADRs) that are conviction weighted. The Fund will concentrate (i.e., invest more than 25% of the value of the Fund’s assets) in securities of issuers having their principal business activities in groups of industries in the information technology and industrials sectors, This concentration limit does not apply to securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities.

 

TrueShares Low Volatility Equity Income ETF

Ticker: DIVZ
Exchange: NYSE Arca
Expense ratio: 0.65%
Original filing date: November 12, 2020
Effective date: January 26, 2021
Listing Date: February 3, 2021
CUSIP: 53656F474
Active: Yes
Index: Not applicable

Investment Objective: DIVZ seeks to provide capital appreciation with lower volatility and a higher dividend yield compared to the S&P 500 Index.

Investment Strategy: US listed value companies selected from bottom up analysis and assessment of their their ability to sustain and grow their dividends, which in turn leads to more stability and lower volatility.

Constituents: 25-35
 
Adviser: TrueMark Investments,LLC
Sub-Adviser: Titleist Asset Management, Ltd.
 
Prospectus is here.

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Principal Investment Strategy

The Fund is an actively-managed exchange-traded fund (“ETF”) that seeks to achieve its investment objective by purchasing 25-35 stocks of companies that pay dividends and expect to grow the dividends over time and are trading at attractive valuations at the time of the investment. The Fund’s investment adviser, TrueMark Investments, LLC (the “Adviser”), and sub-adviser, Titleist Asset Management, Ltd. (the “Sub-Adviser”), will seek to invest in such companies that are established businesses with high cash flow, stable revenue streams, and more disciplined capital reinvestment programs which may, in turn, experience lower volatility relative to the overall equity market.

The Adviser and Sub-Adviser will focus on companies whose stock is listed on a U.S. exchange with market capitalizations greater than $8 billion, but may include companies with market capitalizations of less than $8 billion if their dividend yields are above the market average. The Adviser and Sub-Adviser will select companies for the Fund that, in the Sub-Adviser’s determination, provide the best combination of dividend yield with potential for dividend growth and are currently under-valued in the market. Under normal circumstances, at least 80% of the Fund’s net assets, plus borrowings for investment purposes, will be invested in equity securities, including common stocks and American Depositary Receipts (“ADRs”).

The Sub-Adviser makes its initial identification of potential portfolio securities based on its assessment of a company’s ability and commitment to sustain and grow its dividends. The Sub-Adviser seeks to identify such companies by utilizing a combination of quantitative and qualitative indicators of the company’s financial position, growth opportunities, historical payouts, and management commentary, as well as the competitive landscape.

The Sub-Adviser will then review the current market valuation of these companies which the Sub-Adviser believes are under-valued. The Sub-Adviser first identifies “high quality companies,” which are generally defined as companies with a sustainable competitive advantage, offering stable and growing free cash flows, and quality management teams that have the capital discipline to distribute dividends to shareholders. The Sub-Adviser then selects companies whose stock is trading at a valuation that it believes offers an opportunity to generate above average returns over time. The Sub-Adviser utilizes a variety of metrics (e.g., price compared to earnings ratio, market capitalization compared to book value, free cash flow yield, etc.) in the valuation process and seeks to identify companies that are attractively priced both in absolute terms and relative to their peers with a preference of companies with higher free cash flow.

UPDATE: LISTED ON THURSDAY, JANUARY 28, 2021

WisdomTree Cybersecurity Fund

Ticker: WCBR
Exchange: NASDAQ Stock Market LLC
Expense ratio: 0.45%
Original filing date: October 14, 2020
Effective date: January 15, 2021
Listing Date: January 29, 2021
CUSIP:
 
Active: No
Index: WisdomTree Team8 Cybersecurity Index
Investment Objective: WCBR seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Team8 Cybersecurity Index.

Investment Strategy: 

The WisdomTree Team8 Cybersecurity Index is designed to track the performance of companies primarily involved in providing cyber security-oriented products that meet Index eligibility requirements. The Index was established on October 30, 2020.

Constituents: 25
 
Adviser: WisdomTree Asset Management, Inc.
Sub-Adviser: Mellon Investments Corporation
 
Prospectus is here.

Index Methodology:

https://www.wisdomtree.com/-/media/us-media-files/documents/resource-library/pdf/research/methodologies/core-equity-index-methodology.pdf

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Principal Investment Strategies of the Fund

The Index is designed to provide exposure to equity securities of exchange-listed companies globally, which are primarily involved in cybersecurity and security-oriented technology that generate a meaningful part of their revenue from security protocols that prevent intrusion and attacks to systems, networks, applications, computers, and mobile devices (collectively, “cybersecurity activities”) and are experiencing revenue growth. The cybersecurity themes used as guidelines to determine if a company is primarily involved in cybersecurity activities are described in detail in the “Additional Information About the Fund’s Investment Strategies” section of the Prospectus.

To be eligible for inclusion in the Index, a company must meet the following criteria as of the Index screening date: 

(i) derive at least 50% of their revenue from cybersecurity activities; 

(ii) revenue growth greater than or equal to 7% over the trailing three years for new constituents and revenue growth greater than or equal to 5% over the trailing three years for existing Index constituents; 

(iii) market capitalization of at least $300 million; and 

(iv) have an average daily dollar trading volume of at least $1 million for each of the preceding three months.

The Index is reconstituted and rebalanced semi-annually. As of December 31, 2020, companies in the information technology sector comprised a significant portion of the Index.