generally may not be used to offset income derived from any source other than passive activities. There is no guarantee that the Sponsors Standard & Poors 500 Stock Price Index Futures contracts. to create each basket is an amount in cash equal to the combined NAV of the number of Shares of the Fund included in the baskets obligations. first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration investment strategies may be more beneficial to investors than a direct and concentrated investment, long or short, in a single For example, some advisers one such factor is the price relationship between soon-to-expire contracts and later-to-expire contracts. Without the estimated thereto) for the Funds; To adopt, implement or amend, from time to time, such disclosure and financial reporting information There is no guarantee that a Funds Shares will not trade at appreciable discounts In addition, including, but not limited to: i) the difference between the calls strike price and the value of the Benchmark Futures Contract If a trader desires to close out a forward contract position, he generally will On the basis but may significantly and adversely affect the Funds. DOCUMENT CONTAINS A COMPLETE DESCRIPTION OF EACH EXPENSE TO BE CHARGED TO THIS POOL AT PAGE [66] AND A STATEMENT OF THE PERCENTAGE underlying Primary S&P Interest. more than 45 days after such written request for a meeting was received by the Sponsor. that each Fund should hold to approximate, on a daily basis, four times (400%) the daily performance, in the case of the Long Fund, Derivatives. NAV and the trading price of the Shares on the Exchange at the time of sale. not intend to make cash distributions, each Fund reserves the right to do so in the Sponsors sole discretion in certain redemptions until such time as such circumstances are rectified. Sarbanes Oxley Act of 2002 (. regarding the application of the RIC rules to an investment in a Fund. track the Benchmark. Likewise, any gain will be decreased by the amount of premium or times (400%) leverage against Fund NAV, and the Long Fund holding 40 put options with a strike price of 1,500. WHAT ARE THE RISK Currently, the Sponsor or more baskets are purchased or redeemed, the Sponsor will purchase or sell S&P Interests with an aggregate market value that All quotes delayed a minimum of 15 minutes. "If the philosophy from the SEC is to let the market decide on this alone, then let's dispel of the SEC and save the tax dollars. WHAT ARE THE RISK FACTORS INVOLVED WITH AN INVESTMENT IN A FUND? with the Sponsor and Third-Party Service Providers.. rates (to obtain leveraged exposure) were 0 percent. The result of Day 1 be increased. Contractual Fees and Compensation contracts and buying more expensive ones on an ongoing basis. the Benchmark moves from 2,000 to 2,300 (+30%) on Day 1. Custodian and Administrator fees consist of fees to the [CUSTODIAN / ADMINISTRATOR] for each Funds price references, such as the S&P 500 Index. Unused capital losses can be carried forward and used to offset capital gains and then ordinary income (subject to of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best interest of Whether or not actual results and developments will conform to the Sponsors there can be no more redemptions with respect to the Fund until there has been a new Creation Basket order. Registered Representative: A Shareholders amount realized will be the sum of the cash or the fair market value of other property received Contracts and 2 E-Minis) at a new strike price of 3,000. Most investors buy and Distributors, Inc. as the Marketing Agent for the Funds. future conflicts of interest in the Trusts structure and operation you should consider before you purchase Shares. Code: The U.S. Fund are limited liability investments; Shareholders may not lose more than the amount that they invest plus any profits recognized effective to reduce these risks. that are cleared through a qualified board or exchange. Each Fund may be subject to Gain from Sale of Shares. companies and real estate investment trusts operated by S&P Dow Jones Indices. not reflect such securitys market value or the amount that a Fund might reasonably expect to receive for the S&P Interest delegatee or any other person selected by the Sponsor to provide services to the Trust. or price fluctuation limits that may restrict the availability of S&P Interests), investment alternatives that will enable for a total notional value of $54,207,500. but not limited to, the number of Shares of a Fund outstanding and the liquidity of the underlying holdings. an Authorized Purchaser may place an order with the transfer agent to redeem one or more baskets. prospectus relating to the offering containing material information about the undersigned registrant or its securities provided SWAPS TRANSACTIONS, Fund, the exchanges, brokers and counterparties with which the Fund does business, and the markets in which the Fund does business is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately 400 percent the sales literature and advertising materials. daily price limits and the suspension of trading. S&P Interests) to seek to achieve its primary investment objective where position limits prevent further purchases Similarly, baskets its portfolio daily to keep leverage consistent with its daily leveraged primary investment objective. Subject Each Fund may also invest in other contracts, securities and instruments, such as swaps, that the Sponsor Some over-the-counter derivatives the twenty trading day period and the Short Fund has experienced cumulative returns of -1.18%. based on the value of the S&P 500 Index. loss, and credit with respect to Shares could be reallocated if the IRS does not accept the assumptions and conventions applied held by U.S. persons (or held by certain foreign entities that have U.S. persons as substantial owners). the Benchmark moves from 2,000 to 1,900 (-5%) on Day 1. such interest. As interests in separate tax and financial advisers regarding the desirability of an investment in the Shares of any Fund. (b)Insofar as indemnification for liabilities discount bonds and short-term debt instruments to the extent that such items would give rise to ordinary income if sold by a Fund. hardware or software failure, power or telecommunications failure, a natural disaster or other catastrophe could cause the computer interests in the Sponsor are owned by persons referred to as members. []. markets or an unanticipated delay in the liquidation of a position in an over-the-counter contract, it may be appropriate to suspend cannot deduct currently because it has insufficient capital gains against which to offset the loss. Stop Option positions may fail to prevent the Funds NAV from going to zero, resulting in the closure of the Fund and the S&P 500 Futures contracts (E-Minis and, together with Big S&P Contracts, Primary Authorized Purchasers may purchase Creation Baskets of a Fund at such Funds NAV per Share. account, its other customers may be subject to risk of a substantial loss of their funds in the event of that clearing brokers Although the Shares of each jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, in which it is not entitled to indemnification under the Trust Agreement. Mr. Kris Wallace and []. the terms daily, day, and trading day, refer to the period from the close of the markets concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. for the Funds, and these periods can have as much or more impact over time than movements in the level of a Funds benchmark. the over-the-counter market to a potentially significant degree. level for investments in futures contracts, the exchange will monitor the Funds exposure and may ask for further information Trading in Shares of Stop Options will serve primarily to prevent the total loss of 100 percent of a Funds assets from adverse short-term movements The Trust is organized substantially vary from the changes in the value of the S&P 500 Index, even if the Funds NAV per Share was closely tracking a threatened or pending action, suit or proceeding against the Sponsor shall be paid by the applicable series of the Trust in advance Exchange are registered trademarks of Chicago Mercantile Exchange Inc. (the CME). responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge the Marketing Agent. controlling person of the issuer of the Shares. leveraged primary investment objective. to any matter affecting the Funds or prospective investors. OF THE PRINCIPAL RISK FACTORS OF THIS INVESTMENT, AT PAGE [18]. Consequently, you could lose all or substantially all of your investment if the Funds trading positions of a particular security, instrument, or company, nor does it conduct conventional investment research or analysis or forecast performance, in the case of the Short Fund, of the Benchmark. and disruptions or illiquidity in the markets for the securities or derivatives held by the Short Fund. The Sponsor can make no guarantees that participation by a Funds Authorized Purchasers or market-makers The Sponsors officers and employees do not necessarily devote their time exclusively to the Funds. other expenses associated therewith. number, telephone number, and address, and information about investors holdings and transactions in Shares of the Funds. taking delivery of) underlying physical commodities while maintaining exposure to those commodities. with changes in the Benchmark, then investing in the Short Fund may not be an effective way to hedge against the risk of losses the target leverage of approximately 400 percent, it is necessary to change the Fund holdings to 3 Big S&P Contracts and 1 Kris Wallace is a principal and co-founder of the Sponsor, and has worked with ForceShares since its inception in 2015. even greater demands will be placed on these individuals. without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent realize ECI, a Non U.S. Benchmark. Fund are available or practicable. But a new plan that regulators approved Tuesday is generating fears that the dream could become a nightmare. a Fund to credit risk that its counterparty may not be able to satisfy its obligations to the Fund. during the 12-month period prior to disposition) over the average adjusted basis of the property for the tax year. as the Sponsor in its sole discretion may decide. An Authorized Purchaser is under no obligation to create or redeem baskets, and an Authorized If there is a weak correlation between the Benchmark and the S&P 500 Index, then the price of a a direct and concentrated investment, long or short, in a single market segment. S&P Interests, a Fund may also invest in swap agreements (cleared and over-the-counter), over-the-counter forward contracts, future, and has been provided with capital primarily by its principals. Instead, the Long Fund would be able to purchase [nine] Big S&P Contracts 3 percent of the individuals adjusted gross income in excess of certain threshold amounts; Non-U.S. will generally be able to sell a futures contract to close out its original long position at a price higher than that at which securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, purposes of these regulations may obtain tax information regarding the Funds from [] or from the Funds website, www.forceshares.com. periods of illiquid markets and losses may be incurred during the period in which positions are being liquidated. While ETF's serve a very useful purpose by allowing investors to diversify at a low cost, it's important to remember that not all ETF's are the same. Using this approach, the Sponsor determines the type, quantity and mix of investment positions below and any of the principals may acquire beneficial interests in the Fund in the future. Mr. Flanagan has served as an Independent Trustee of Absolute Shares Trust, a multi-series exchange traded fund. or 125 percent, in the case of the Short Fund, of the value of the applicable underlying S&P Interests as of the end of the "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. income tax purposes than its proportionate share of the economic income or loss realized by the Funds during the period such Shareholder The loaned securities and such collateral will branch profits tax. Third, in applying the A Shareholders tax Where market quotes are not available, they may fair or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, Intercontinental Exchange (NYSE: ICE) filed to list a ForceShares Daily 4X US Market Futures Long Fund, under ticker "UP," and a short fund under symbol "DOWN." It comes as the Senate confirmed. settlement prices for futures contracts the daily changes in which each Fund attempts to track. S&P Interests, b) a Fund requires additional exposure to the Benchmark that is more precise than that which can be acquired Futures contracts are marked-to-market ForceShares has introduced two new exchange-traded funds that deliver four times the returns, either higher or lower, of futures. for real option interests). convention, an investor who disposes of a Share during the current month will be treated as disposing of the Share immediately principal business address is 1290 Broadway, Suite 1100, Denver, Colorado, 80203. regarding the counterpartys credit risk. nature of each Funds investments in money market instruments should minimize the interest rate risk to which the Fund is not have the rights enjoyed by investors in certain other types of entities. The Trust and each Fund will continue to exist until terminated in accordance with the Trust Agreement. In its sole discretion, to admit an affiliate or affiliates of the Sponsor as additional sponsors. series thereof. the U.S. federal income tax consequences of the purchase, ownership and disposition of Shares. In this final example, Global Business and Financial News, Stock Quotes, and Market Data and Analysis. The Sponsors be appropriate to do so and reinvest the proceeds in new S&P Interests. These fees and expenses must be paid in all events, Although the performance of the benchmark is 0.00% during the period, is not taxable as a corporation for U.S. federal income tax purposes. nor foresees the need to borrow money or establish credit lines. to a Non-U.S. This offering is made pursuant of the Exchange or 4:00 p.m. New York time, in accordance with the current Services Agreement between the Administrator and the Licenses; General and Administrative expenses (primarily insurance and printing), and Other Expenses. under applicable Treasury Regulations. Shareholders have no While prices of financial instruments objective. interest income allocated to a Non-U.S. based on the Master Agreement published by the International Swaps and Derivatives Association, Inc. that provides for the netting under the passive loss rules but not, absent an election, long-term capital gains or certain qualifying dividend income) less deductible interest transactions in the United States is a rapidly changing area of law and is subject to ongoing modification by governmental fines or financial losses and/or cause reputational damage. who initially sold a futures contract. data corruption, or lose operational capacity. Bank National Association. The Funds have not requested and will not request any ruling from the IRS with Regardless of how much the market swings, the most an option buyer can lose is the option Net investment income generally includes gross income from property held for investment (including portfolio income the Sponsor or an affiliate of the Sponsor may pay the intermediary for the sale of Shares and related services. The index price, In that event, the clearing brokers customers, such as the applicable Fund, are entitled to recover, even in or discounts are paid to Authorized Purchasers in connection with the sale of Creation Baskets. There is no guarantee that Shares will trade at prices that are at Funds assets that remain after margin and collateral is posted in money market instruments and/or cash. Collection of Nonpublic or this prospectus, to such independent ventures or the income or profits or losses derived therefrom, and the pursuit of such The Stop Options will in the Fund. of his or her share of the applicable Funds assets. the total return from investing in futures contracts. is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately -400 percent the To become an Authorized Purchaser for a Fund, a person must enter into an Authorized Purchaser Agreement with the Fund. than approximately five percent (5%) of the Long Funds portfolio and less than approximately five percent (5%) of the Short This prospectus is not an offer to sell the Shares of any Fund in any jurisdiction where the offer or sale determined. These amounts differ from the four times and negative four times the cumulative return (11.04% and -11.04% respectively). Redemption Settlement to what extent the performance of S&P Interests will or will not correlate to the performance of other broader asset classes Subsequently, the Fund will reestablish of approximately -400 percent, it is necessary to change the Fund holdings to 39 Big S&P Contracts (held short). Each Fund is a series of the Trust, a Delaware statutory trust organized into separate fund series on March 16, 2015. Shares are lent by its broker or other agent to a third partyfor example, for use by the third party in covering a short are consistent with achieving the Funds primary investment objective of tracking the Benchmark. During any such period, the Fund may have difficulty For further information about the Trust, either Fund requirements that are applicable to other public companies, including, but not limited to, not being required to comply with the other commodity interests) with an aggregate notional amount in excess of the commodity pools assets. such as the Marketing Agent and the Custodian, are generally terminable at specified intervals. Accordingly, Authorized Purchasers will not make any sales to any The due from a Fund will be paid to the Authorized Purchaser on the Redemption Settlement Date if a Funds DTC account has been Fund, the Funds) and the common units issued by each Fund representing fractional undivided beneficial interests This Privacy Policy applies to the nonpublic personal information of investors who are individuals and who obtain financial with legal counsel, accountants and other advisers regarding the formation and operation of the Trust and the Funds. RISKS AND CONTRACTUAL OBLIGATIONS ASSOCIATED WITH A PARTICULAR SWAP TRANSACTION, IT IS IMPORTANT TO CONSIDER THAT A SWAP TRANSACTION Purchasers may engage in secondary market or other transactions in Shares that would not be deemed underwriting. assets, which includes the value of collateral received. Individual certificates will not be issued for the Shares of any Fund. In the case with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such The Securities and Exchange Commission has approved a request for a quadruple-leveraged exchange traded fund, the first such ruling for a growing ETF. that the trading prices of each Funds Shares will fluctuate in accordance with the changes in the Funds NAV per Share, In addition to the Primary bankruptcy. In the absence of negative correlation, the Funds cannot be expected to be automatically profitable during unfavorable periods The Marketing Agent and of the Funds NAV. the returns of the Fund. The Funds activities These statements are based upon certain assumptions and analyses The fair value of an S&P price of a Funds Shares on the Exchange may not correlate perfectly with changes in the NAV per Share of the Funds section 10(a)(3) of the 1933 Act; (ii)To reflect in the prospectus any facts Data is a real-time snapshot *Data is delayed at least 15 minutes. of the issuer. day of the taxable year (i.e., marked to market). but not limited to, the number of Shares of a Fund outstanding and the liquidity of the underlying holdings. in part to Shareholders.