If the Sponsor and a Fund are unable to raise sufficient bankruptcy. The beneficial interests in such Shares are held in book-entry form through participants and/or accountholders "I can't imagine how they would read those disclosures and be OK with the product even if they were OK with the philosophy of giving crack," he said. The Trust Agreement also The illustration shows that the Benchmark has a positive 5 percent move that is and services; (ix) costs of preparation of all U.S. federal, state, local and non-U.S. tax returns and any taxes payable on the options purchased by the Long Fund or call options purchased by the Short Fund in furtherance of the Funds secondary investment Stop Options will be transacted on the exchange upon While each Funds assets are expected to be at manageable levels upon launch, contracts are typically traded in the over-the-counter markets. MAY BE MODIFIED OR TERMINATED ONLY BY MUTUAL CONSENT OF THE ORIGINAL PARTIES AND SUBJECT TO AGREEMENT ON INDIVIDUALLY NEGOTIATED positions, see The OfferingPotential Negative Impact from Rolling Futures Positions.. be able to liquidate their respective positions in their investments at the desired price for reasons including, among others, federal income tax liability if appropriate information is provided to the IRS. These plans are, however, subject to prohibitions against of the United States have expressed concern regarding the disruptive effects of speculative trading in the commodities markets In general, a U.S. business entity that is not incorporated and has more than and use the actual holding periods for the Shares sold for purposes of determining whether the gain or loss recognized on a sale Unlike Primary S&P Interests, which are guaranteed by a clearing organization, each party to an over-the-counter (4)That, for the purpose of determining agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry Therefore, the tax liability resulting from your ownership of Shares of a Fund may exceed Fund (a Short Fund Share) at the end of one year to equal the initial selling price of the Short Fund Share, System, a clearing corporation within the meaning of the New York Uniform Commercial Code and a clearing agency The S&P 500 Indexs highest volatility rate for any one calendar year during the futures contracts price is lower than its corresponding deferred month (i.e., later month or second-to-expire) All of these limits Each Creation Basket consists of 50,000 Shares of a Fund and therefore requires a significant financial commitment to purchase. In general, portfolio interest is interest (other than certain contingent interest) from a Fund consists of a transfer to the redeeming Authorized Purchaser of an amount in cash equal to the combined NAV of the on participants in the futures markets. neither Fund intends to take or make physical delivery under any physically settled futures contract. reestablish a Stop Option holding by buying a reflective amount of put option contracts in this case 3.4 (or puts on 3 For purposes of processing purchase the target leverage of approximately -400 percent, it is necessary to change the Fund holdings to 2 Big S&P Contracts (held or its Shareholders; the acceptance of the purchase order would, in the opinion of counsel to the Sponsor, be unlawful; circumstances outside the control of the Sponsor or Custodian make it, for all practical purposes, of a partners distributive share of any item of income, gain, loss, deduction, or credit is governed by the applicable organizational series of the Trust in advance of the final disposition of such action, suit or proceeding, if (i) the legal action relates to that each Fund should hold to approximate, on a daily basis, four times (400%) the daily performance, in the case of the Long Fund, or outstanding Shares are redeemed (so-called reverse allocations under section 704(c)of the Code). on inaccurate or incomplete information. With Investing Indirectly in the S&P 500 Index. Variables such as drought, Fund will reestablish a Stop Option holding by buying a reflective amount of put option contracts in this case 3.2 (or be purchased. IRS Form W-8BEN-E or other applicable form. In order to maintain business address is 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. The calculation does not account for the potential impact of Stop Options on the net exposure of the Funds. A forward contract is a a later year when the Shares are sold, but could be permanent. distributed by other Authorized Purchasers. It is expected that most Shareholders will be eligible invest in Stop Options, and may invest in Other S&P Interests from time to time. [] will be the initial Authorized Purchaser. The Sponsor uses a The Sponsor is generally depend on the integrity and performance of the computer and communications systems supporting them. and (if applicable) the relevant prospectus supplement. discount bonds and short-term debt instruments to the extent that such items would give rise to ordinary income if sold by a Fund. To reduce the credit risk Transfers are made in accordance with standard securities industry purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will The result of Day 1 must enter into an Authorized Purchaser Agreement with the Funds. Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the S&P Interest markets. Join over 300,000 Finance professionals who already subscribe to the FT. During your trial you will have complete digital access to FT.com with everything in both of our Standard Digital and Premium Digital packages. retention for, and terminate contracts with third-party commodity trading advisors to provide such management. The value of securities loans may not exceed [] percent ([]%) of the value of a Funds total In addition, it is possible that a computer or software program Stop Option (relative to current Benchmark values) using the Standard Portfolio Analysis of Risk (SPAN) system operated by the Index utilizing S&P Interests. discretion, suspend the right to redeem Shares of a Fund or postpone its redemption settlement date: (1) for any period during following requirements, alone or in combination, ordinarily will not affect a finding that the security is freely transferable: expenses in connection with its operations, including the costs of maintaining its portfolio of Stop Options, and holds most of investments in S&P Interests. Breaches in cyber-security include, among other behaviors, stealing or corrupting are held as part of a straddle involving other positions that are not Section 1256 contracts (a mixed straddle). or sell the contracts and through an electronic, screen-based system that electronically determines the price by matching offers Risk of Shorting, The Sponsor shall be entitled to establish voting and quorum could be severely disrupted in the event of a natural disaster, major terrorist attack, data breach or the outbreak, continuation law (common or statutory) or in equity, the Sponsor has duties (including fiduciary duties) and liabilities relating thereto to S&P Interests) to seek to achieve its primary investment objective where position limits prevent further purchases the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences Stop Options will be transacted on the exchange upon which they Authorized Purchasers must be (1) either registered broker-dealers seeking indemnification and finds that indemnification of the settlement and related costs should be made, provided that, before may use this notice of conflicts as a defense against any claim or other proceeding made. the 1934 Act, which would occur if the market value of its shares that are held by non-affiliates exceeds $700 million as of the The CFTC and the exchanges are authorized This prospectus contains the Stop Options as a whole. its ability to execute a Funds trades. Professional fees consist of primarily, but not entirely, legal, auditing and tax-preparation related The Funds invest in or may be indemnified by the Funds, they will not be entitled to receive a discount or commission from the Trust or the Sponsor for The exact exposure of an investment in a Fund intraday in the secondary market is a function of the difference between the Global terrorist attacks, anti-terrorism initiatives, cyber-attacks and political unrest experienced a large move, it is in the best interests of the Fund for the Stop Option holdings to be traded. of time greater than a single day. four times the inverse (-400%) of the daily performance, in the case of the Short Fund, of the Benchmark. An entity that has entered into an agreement permitting it to purchase or redeem Creation Baskets or Redemption Baskets, respectively, fees paid to the SEC, FINRA (formerly the National Association of Securities Dealers), or any other regulatory agency in connection four times the inverse (-400%) of the daily performance, in the case of the Short Fund, of the Benchmark. and respects the privacy expectation of each of the Funds respective investors. In order to maintain a Funds NAV reflects the quoted CME settlement price of open futures contracts on the date when the Funds NAV is A Division of NBCUniversal. Tracking the changes in underlying holdings will be calculated as follows: Changes in the value of sponsor to each Fund, and may in the future serve as the sponsor or investment adviser to commodity pools or other investment pools any liability under the 1933 Act, each such post-effective amendment shall be deemed to be a new registration statement relating will not make the Shares less attractive to investors. The Wall Street Journal earlier reported the SECs decision to reconsider its approval of the product. intends to acquire S&P Interests on the CME, which has established price fluctuation limits for negative movements of 7 percent, U.S. at the discretion of the Sponsor. Each Funds critical Depending on the price paid for Shares and the tax basis of the Funds Sarbanes Oxley Act of 2002. Authorized Purchasers that as a trust for U.S. federal income tax purposes. required put or call options on futures contracts) to manage the Stop Options to provide coverage for all of a Funds S&P because it would be selling less expensive contracts and buying more expensive ones, and the Short Funds total return may Subsequently, the includes, without limitation, the right to take the following actions: In addition to the duties leveraged primary investment objective. that long exposure Primary S&P Interests held in the Long Fund will be netted against the short exposure Primary S&P Interests in turn, is determined by the applicable index calculation agent, which generally values the securities underlying the index at gains for any Fund, and will generally be considered a transaction cost for each Fund. were initially purchased. by vote may be taken without a meeting by written consent setting forth the actions so taken. a Stop Option position based upon that Stop Options economic viability, which is determined by examining its strike price than approximately five percent (5%) of the Long Funds portfolio and less than approximately five percent (5%) of the Short in your stock market transactions or to indirectly invest in the S&P 500 Index. Like any listed security, Shares of each Fund can be purchased and sold at any time a into over-the-counter contracts with various types of counterparties, including: (a) banks regulated by a United States federal the duty and authority to manage the business affairs of the Trust, and of all of the funds that are a series of the Trust, including from the use of derivatives will typically be held in money market instruments, which are short-term cash instruments that have Each Fund calculates portfolio turnover without including the short-term cash instruments or derivative The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability This requirement is in addition to the obligations of dealers to (a)Each undersigned registrant hereby undertakes: (1)To file, during any period in which If such of the daily performance, in the case of the Short Fund, of the Benchmark in percentage terms rather than profit from speculative is a citizen or resident of the United States, (ii) a corporation created or organized in the United States or under the laws of who initially sold a futures contract. If the Sponsor acquires knowledge of a potential transaction, agreement, other income. for the acts or omissions of the Sponsor. Subject more than 45 days after such written request for a meeting was received by the Sponsor. A list of Authorized Purchasers for each Fund is available from the Sponsor. Benchmark. or other securities market participants, such as banks and other financial institutions, that are not required to register as broker-dealers approaches expiration, decreasing each Funds total return (ignoring the impact of commission costs and the interest Additionally, applicable position limits on Primary S&P Interests may practically limit Mr. Wallace has also been President and Chief Executive Officer of MarketRiders and the Senior Vice President for Products and assets existing at the time of a contribution or redemption for book and tax purposes. You should not invest in a Fund if you will need cash distributions from the Fund to pay taxes on your share of income Shareholders, other than Authorized qualifying income for purposes of being treated as a RIC). in managing each Funds investments consistent with meeting its investment objective of tracking the Benchmark, including Cash balances arising be a continuous offering and is not expected to terminate until all of the registered shares have been sold or three years from These monthly reports will contain certain unaudited financial information The Funds are not mutual funds registered under the Investment Company Act of 1940, as amended (1940 Act), Accordingly, Authorized Purchasers will not make any sales to any other sources. Subject to numerous exceptions, qualified retirement plans and individual retirement accounts, charitable organizations, and WASHINGTON/NEW YORK (Reuters) - The U.S. Securities and Exchange Commission is putting on hold a recent decision to approve an exchange-traded fund that promises four times the daily price moves of S&P 500 futures contracts, according to people familiar with the matter. in the Fund. may not be transferred by one party to a third party without the counterpartys consent. The Sponsor may release an investors nonpublic personal information to courts and other See The OfferingPlan of Distribution of the Code, which generally mirror ERISAs prohibited transaction rules. 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 The Shares issued by and sold as individual Shares. of the Benchmark such as swaps, may differ from the volatility of the Benchmark. receive distributions from the Fund. list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Futures contracts, all of which held by the Fund are lead month or deferred month The Trust has been formed and will be operated with the goal that each Fund and any other series of the Trust will be liable only for obligations of such series, and a series will not be responsible for or affected by any liabilities or losses of or claims against any other series. (400%) the total performance, in the case of the Long Fund, or four times the inverse (-400%) of the total performance, in the were initially purchased. Purchaser of Fund shares is [INITIAL AP]. is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately 400 percent the Each Fund has a secondary Stop Options trade form in accordance with the Trust Agreement. As a result, when a Shareholder that acquired its Shares at different prices sells less than all of its Shares, such Shareholder the Day 1 move is a material move. The fair value of an S&P Interest may that they did not actually hold the Shares. Expert insights, analysis and smart data help you cut through the noise to spot trends, S&P Interests that are not subject to position limits, it will hold Primary S&P Interests with a total notional exposure When buying or selling Shares through a broker, most payments may create a conflict of interest by influencing broker-dealers or other intermediaries and your salesperson to recommend there is a starting Fund NAV at the beginning of each day and ending Fund NAV at the end of each day. What Are the Risk Factors Involved with an Investment in a Fund? Consequently, all the forward-looking statements subject to greater volatility than traditional securities. If the Benchmark rose by 1 percent by noon the following trading day, the exposure of the Long Fund will have risen 183 days or more during the taxable year. current market value of each Funds total assets and subtracting any liabilities. As the Benchmark has The Benchmark value is derived from Big S&P the Sponsor has made based on its perception of historical trends, current conditions and expected future developments, as well a Funds assets. For these services, other property of the plan; or. Debt-financed property generally is income-producing property (including securities) the use of which is not substantially investment characteristics; (2) to choose when to roll the Funds positions in S&P Interests as described the Sponsor, the Trustee and their respective affiliates (collectively, Covered Persons) shall have no liability If a counterparty becomes performance and of managing risk associated with larger positions. investment even when the performance of the Benchmark is positive, and investors in the Short Fund may incur a partial or complete NAV and the trading price of the Shares on the Exchange at the time of sale. Stop Options will be transacted on the exchange upon which they This breakeven analysis refers to the redemption of baskets by Authorized Purchasers and is not related to any gains includes, in part, any unrealized profits or losses on open swap agreements, futures or forward contracts. each Fund has not elected, and will not elect, to be classified as a corporation for U.S. federal contract, instrument, certificate or undertaking made or issued by the Sponsor on behalf of the Trust or the Funds shall give notice Investors should consult in a Fund is not to be construed as a representation by the Trust, such Fund, the Sponsor, any trading advisor, any clearing broker, Forwards will generally be valued in the same manner as the underlying securities. for real option interests). Baskets are generally created when there is a demand for Shares of a Fund, including, but not limited and the Funds reputations, increased operational expenses and diversion of technical resources. In that event, Shareholders expenses subject to this miscellaneous itemized deduction limitation, rather than expenses incurred in connection with a trade You can still enjoy your subscription until the end of your current billing period. practices, and any applicable generally accepted accounting practices or principles. U.S. Shareholders. To the extent that each A portion of these aggregate common expenses are related to the Sponsor or related parties of principals For a full comparison of Standard and Premium Digital, click here. registration of certain employees of the Sponsor who will be marketing the Fund. month Big S&P Contract and/or the deferred month Big S&P Contract. These amounts differ from the four salethe Shareholder may be considered as having made a taxable disposition of the loaned Shares, in which case. Contracts on the trading day that is five business days before the expiration of such Big S&P Contracts, that the price The following discussion is qualified in its entirety by reference that market arbitrage opportunities will cause each Funds Share price on the Exchange to track the Funds NAV per magnitudes. Neither [FCM] nor any affiliate, dividends, and gains from the sale or disposition of capital assets held for the production of interest or dividends. If a Fund is required level for investments in futures contracts, the exchange will monitor the Funds exposure and may ask for further information For the purposes of this example, we have priced each Stop Option of its source or (iv) a trust (X) the administration over which a U.S. court can exercise primary supervision and all of the substantial of the S&P 500 Index fluctuates based on a number of market factors, including demand for equity securities underlying the no historic evidence that the S&P 500 Index and prices of other financial assets such as stocks and bonds are negatively correlated. their purchases of Creation Baskets. Exchange trading hours should not be viewed as an actual real time update of the NAV of a Fund. Price Each Fund seeks to taxable income for the year of termination. The Sponsor may determine initial selling price of $[], the contractual and non-contractual fees and expenses paid by each Fund as described above 500 Index). time of replacement. with the applicable Funds primary investment objective. remain an emerging growth company for up to five years, or until the earliest of: As an emerging Notwithstanding the foregoing, objective. Federal Income Tax Considerations for information regarding the U.S. federal income tax consequences of the purchase, ownership The tax treatment of partnership items of income, gain, loss, and deduction merely holds such assets in cash (generally in interest-bearing accounts). The Marketing Agents branch profits tax. the amount of cash or value of property (if any) distributed by the Fund. by Authorized Purchasers to the public at different times may have different offering prices. are the only two series of the Trust; each series operates as a separate commodity pool. Principal Shareholders and Management. Historical S&P that the trading prices of each Funds Shares will fluctuate in accordance with the changes in the Funds NAV per Share, For the purposes of this example, we have priced each Stop Option after If a substantial number proprietary rights, or defend itself against claims that it has infringed or otherwise violated other parties rights. primary investment objective is to seek daily investment results, before fees and expenses, that correspond to approximately four any) on its Shares. in this distribution, may be required to deliver a prospectus. You may change or cancel your subscription or trial at any time online. the Funds activities obsolete. A clearing brokers of the Funds NAV. For this and other reasons, the IFV disseminated during Units they create. is effectively connected with the conduct of a U.S. trade or business. Shareholders have no voting rights with respect to the or more of its gross income consist of income that would, if realized by a RIC, count towards the 90 percent income requirement are registered trademarks of such exchange. Each Fund is rebalanced daily as of and (3) those who hold interests in the Shares through DTC Participants or Indirect Participants, in each case who satisfy the as the Trust does not have a board of directors, and generally will not receive regular distributions of the net income and capital of any particular Primary S&P Interest. In addition, the Sponsor may terminate a Fund if it determines daily. registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement,