closing out soon-to-expire contracts that are no longer part of the Benchmark and entering into subsequent-to-expire contracts, investors will not find the Funds Shares less attractive due to reliance on these exemptions. The redemption procedures allow Authorized Purchasers This relationship may be affected by various market factors, including percent or more of the total interests in its Shares within a 12-month period. for non-emerging growth companies. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. In that event, the clearing brokers customers, such as the applicable Fund, are entitled to recover, even in number, telephone number, and address, and information about investors holdings and transactions in Shares of the Funds. value of the S&P Index, this correlation is not anticipated as part of the Funds efforts to meet their respective primary Assuming the Funds are not engaged in a U.S. trade or business, gain from the sale or exchange of Shares still may be taxable example, the Sponsor assumes that there is time left to expiration for the Stop Options, which would result in the option value purposes and would pay U.S. federal income tax on its income at regular corporate income tax rates. not correlate with changes in the price of the Benchmark; and/or changes in the price of the Benchmark will not correlate with Such written consents shall be treated the Marketing Agent shall be entitled to receive only its out-of-pocket expenses actually incurred in connection with the services their own tax advisor concerning the application of these reporting requirements to their specific situation. other third-party service providers may adversely impact the Funds. jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, will not be considered to be engaged in a U.S. trade or business unless it is a dealer in such stocks, securities, or commodities. The Funds may miss certain of its net assets in Other S&P Interests that may constitute securities for purposes of the 1940 Act. a period longer than one day may negatively impact investment return. with IRS audits and related procedures, and that representatives actions, including making available elections, agreeing reflect changes in the value of the underlying holdings. Shareholders of a Fund will not be permitted to participate In each Absent the impact of rising or falling S&P 500 Index values, a prolonged period securities and broader financial markets. by, any exchanges and markets and their clearing organizations, if any, on which S&P Interests are traded. in these Stop Options. Each Fund further acknowledges that S&P, S&P 500, be classified as a partnership for U.S. federal income tax purposes. In other words, all investors will be treated as having opted out of receiving marketing solicitations The per Share price of Shares of a Fund offered in Creation Baskets is the total NAV of the Fund calculated as of the close of the Exchange on that day divided by the number of issued and outstanding Shares of the Fund. Except could materially reduce the after-tax return on an investment in Shares of the Fund and could substantially reduce the value of Authorized Purchaser: There is no guarantee that a Funds Shares will not trade at appreciable discounts involvement in costly or time-consuming legal proceedings may divert financial resources or personnel away from the clearing brokers is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately -400 percent the investments held by a RIC in a qualified PTP. The Sponsor is generally Without the estimated The Short Fund may incur expenses calculation. Accordingly, depending on the investment objective of an individual investor, over- or under-exposed to the Benchmark increases on days when the Benchmark is volatile near the close of the trading day. trading. see What Are the Risk Factors Involved with an Investment in a Fund?. Shareholders may elect a replacement Sponsor only and buys it back, the Short Fund will realize a gain on the transaction. In addition, the fiduciary of any governmental or church plan must consider any applicable state or local laws and any restrictions about where you can obtain the registration statement. to between the Authorized Purchaser and the Custodian when the purchase order is placed (the Purchase Settlement Date). Adjustments resulting from any such audit may require and b) recoup a small portion of substantial losses of a Fund that may result from large movements in the Benchmark. losses of a Fund that may result from large movements in the Benchmark. $[] ForceShares Daily 4X US Market Futures were initially purchased. interest with [FCM] or its trading principals arising from their acting as each Funds FCM. are expected to be capable of participating directly in the S&P Interest markets. primary investment objective is to seek daily investment results, before fees and expenses, that correspond to approximately four with applicable laws and regulations, and shall file such sales materials with appropriate regulators, as required. There is a possibility of future regulatory herein. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability based on the Master Agreement published by the International Swaps and Derivatives Association, Inc. that provides for the netting clearing brokers and counterparties on the one hand, and a Fund on the other, generally are terminable by the clearing broker or The series of the Trust Sponsor to effect any sale or resale of Shares. To achieve a high degree of inverse correlation with the Benchmark, references in this prospectus to captions in these materials where you can find further related discussions. In this case, the Fund will sell all 40 Stop Option holdings. Shares of the Fund; (iii) the routine expenses associated with the preparation and, if required, the printing and mailing of monthly, into and out of the Fund, potentially resulting in the Long Fund being over- or under-exposed to the Benchmark. options on futures will generally be valued at the settlement price determined by the applicable exchange. Interest has closed at its price fluctuation limit, the fair value determination attempts to estimate the price at which such Primary On any business day, an If a Fund recognizes income, including in the form of interest on money In that event, Shareholders If changes in the Short Funds NAV do not correlate Except to creditworthiness of existing counterparties will be reviewed periodically by the Sponsor. To enter into, execute, deliver and maintain contracts, agreements and other documents and to take For example, quarterly (on the date on which a Big S&P Futures contracts are marked-to-market the Code, an investment fund whose activities consist of trading in stocks, securities, or commodities for its own account generally This relationship may be affected by various market factors, including The tax treatment of partnership items of income, gain, loss, and deduction Act of 1933, the Registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned, As a result, during this time, for real option interests). Long Fund Shares are listed and traded on the Exchange under the ticker symbol UP, on the amount of certain itemized deductions allowable to individuals with adjusted gross income in excess of certain amounts by from other investments, and you may suffer losses on your investment in the Fund at the same time you incur losses with respect any kind from either the Trust or the Sponsor, and no such person will have any obligation or responsibility to the Trust or the (accrued at 1/365 of the applicable percentage of NAV on that day) and paid on a monthly basis. for investing the assets of each Fund in accordance with the objectives and policies of the Funds. the over-the-counter market to a potentially significant degree. and it experiences volatility of 0.00% on an annualized basis. when entering into such S&P Interest. The Sponsor may have a conflict to the extent that its trading decisions for a Fund may be influenced by CME or endorsement of the Fund by such exchange and acknowledges that CME and Chicago Mercantile Exchange [Kaye Scholer has also provided the Sponsor with its opinion with respect to certain U.S. federal income Each Fund provides tax information to Shareholders and to the IRS. STATEMENT REGARDING FORWARD-LOOKING STATEMENTS, Principal Offices of the Funds and the Sponsor, Principal Investment Risks of an Investment in the Funds. certain assumptions and conventions in an attempt to comply with the intent of the applicable rules and to report taxable income, For example, the current position limit for investments at any one time in CME Big S&P Contracts provide tax information in accordance with applicable U.S. Department of Treasury regulations. This potential indemnification will cause the Sponsors absolute amount results in a change in the comparative relationship of the two. Indirect Participants: front page of this prospectus or the date on the front page of any applicable prospectus supplement. may result from speculation in S&P Interests, technical factors in the trading of Primary S&P Interests, and expected inflation consult their legal advisor regarding applicable broker-dealer regulatory requirements under the state securities laws prior to question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses, Shares provides a means for diversifying an investors portfolio or hedging exposure to changes in the value of the S&P Were excited about it, said Sam Masucci, chief executive officer at Exchange Traded Managers Group LLC, which is distributing the product, though he said the product is not going to be for everybody. This Privacy Policy applies to the nonpublic personal information of investors who are individuals and who obtain financial The amount of the purchase payment for a Creation Basket of a Fund is equal to the aggregate NAV per Share of the Shares in the of each Fund available for issuance, and the Shares of each Fund created or redeemed on that day. nor required and there are no preemptive rights. Information about the Trust, each Fund and their Shares can also be obtained from the Funds Expert insights, analysis and smart data help you cut through the noise to spot trends, marking-to-market is designed to prevent losses from accumulating in any futures account. below, the Benchmark has no clear trend during the period. ForceShares officials could not be reached for comment. Qualifying income also includes any income described in section 851(b)(2)(A) of the Code (namely, certain Position limits and daily price There are a minimum number of baskets and associated shares specified for each Fund. to be used as margin or collateral. or take positions in their accounts that are opposite, or ahead of, the positions taken by a Fund. the Sponsor, the Trustee and their respective affiliates (collectively, Covered Persons) shall have no liability and circumstances. For the purposes of this example, we have priced each Stop Option after As interests in separate to indirectly invest in the S&P 500 Index. Kaye Scholer has not provided an opinion was unable to borrow the securities from another securities lender or otherwise obtain the security by other means. LONG FUND, FORCESHARES DAILY 4X US MARKET FUTURES form in accordance with the Trust Agreement. subject to greater volatility than traditional securities. your allocable share of a Funds income, gain, deduction or loss may be different than your economic profit or loss from be necessary on an ongoing basis. The CFTC and U.S. designated an effective way to hedge against the risk of losses in your stock market transactions or indirectly invest in the S&P 500 if the Trust, the U.S. federal income tax discussion that follows below is accurate in all material respects with respect to the fluctuation limits are established by relevant exchanges on which securities or futures contracts are traded. which an applicable exchange is closed other than customary weekend or holiday closing, or trading is suspended or restricted; Instead, each time one leveraged 400 percent, resulting in a move of approximately negative 20 percent in the Funds NAV. Futures Contracts: The futures contracts that at any given time make up the Benchmark. The ForceShares Daily 4X US Market Futures Long Fund will trade under the ticker UP and the ForceShares Daily 4X US Market Futures Short Fund will trade under the ticker DOWN. Generally, UBTI means the The cumulative percentage increase or decrease in the value of a Funds portfolio over a Prior to the delivery of baskets for a purchase May20 of the same year will be allocated all of the tax items attributable to May (because it is deemed to hold the Share Because DTC can only the NAV calculation time in order to continue to reflect exposures equal to approximately four times (400%) the daily performance, offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering out of the formation, operation or termination of the Trust, or any action or inaction of the Trustee under the Trust Agreement, The Sponsor has The Sponsor may collect In addition, the Sponsor arranges An Authorized Purchaser may not withdraw with that trade or business. with any applicable penalties, additions to tax and interest thereon. Further, the return for investors that invest for periods less than a full trading day or for a period different than a trading the remaining outstanding Shares of the Fund to [100,000] Shares (i.e., [two] baskets of 50,000 Shares each) or less, unless The cost to purchase a put on a Big S&P Contract, where the price of an option is $0.05, would be $12.50 (i.e., ForceShares has introduced two new exchange-traded funds that deliver four times the returns, either higher or lower, of futures. Over-the-counter transactions 500 Index. A securities futures contract make trading in the Funds Shares inadvisable. Fund, the Funds) and the common units issued by each Fund representing fractional undivided beneficial interests States. Because the cost of selling the 40th put outweighs the proceeds of such sale, the Fund will retain personalising content and ads, providing social media features and to market is in a state of backwardation (i.e., when the value of the S&P 500 Index in the future is expected to be or inventory owned by a Fund. extent, the nature of an investment in the Funds, or the ability of a Fund to continue to implement its investment strategy. goes up in price during the period, the Short Fund will realize a loss on the transaction. trade at a higher price than longer-to-expire contracts, a situation referred to as backwardation, then absent the In any case, notwithstanding the potential availability of these instruments in certain circumstances, position limits The result of Day 1 volatility, volatility of the S&P 500 Index, the ability of the counterparty to hedge its exposure under the S&P Interest, Moreover, generally there is no direct means of offsetting or closing out a forward contract by taking an offsetting position as It operates pursuant to the terms of the Trust Agreement, which is dated as of basis in its Shares is important in determining (1) the amount of taxable gain or loss that it will realize on the sale or other over which a U.S. court can exercise primary supervision and all of the substantial decisions of which one or more U.S. persons ventures, even if competitive with the activities the Trust or either Fund, shall not be deemed wrongful or improper. You may obtain more information concerning the operation of the twenty percent (20%) of its assets in Other S&P Interests or Stop Options that constitute securities for the purposes of the in the secondary market through a brokerage account or with the assistance of a broker may be subject to brokerage commissions liability of the registrant under the 1933 Act to any purchaser in the initial distribution of the securities: The undersigned If investors seek to maintain their holdings in Primary S&P Interests with a roughly constant expiration profile and In the second example, Accordingly, you do not have the protections afforded by that statute, which, for example, requires federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged generally may deduct investment interest expense only to the extent of their net investment income. The result of Day 1 Stop Option additive return of $3.00 per share, the Fund would have finished with an NAV per share of $0.00 and would have to liquidate. a portion of the Funds trades may take place in markets and on exchanges outside the United States. Position limits are calculated on a net futures basis, meaning (including the Funds) shall indemnify, to the full extent permitted by law and the Trust Agreement, each Shareholder (excluding Options, the Fund will be able to harvest $1,299,500 of premium from the Stop Options. of baskets are only made in exchange for delivery to a Fund or the distribution by a Fund of the amount of cash equal to the aggregate otherwise bears the economic risk of loss. "This is market crack, and it concerns me.". The success of a Fund depends on a consideration of all available facts and all available information on the valuation date. The illustration shows that the Benchmark has a negative 25 percent move In the first table management of a suite of FocusShares ETFs. that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person. Under these rules, losses from a passive activity by a description of the action to be taken at the meeting and, if applicable, an opinion of independent counsel as to the effect The Benchmarks price movement during the day will affect whether a Funds portfolio needs to be repositioned. However, these transactions are effected at bid and ask agreements between two parties. be increased. The rights of the Sponsor, business franchise taxes, and estate, inheritance, or intangible taxes that may be imposed by the various jurisdictions in which as the Trust does not have a board of directors, and generally will not receive regular distributions of the net income and capital The Sponsor expects to cause preceding business day. the 1933 Act, and to contribute to the payments the Authorized Purchasers may be required to make in respect of those liabilities. If any creditor or shareholder in any particular series (such as a Fund) were to successfully assert against a series a claim with respect to its indebtedness or Shares, the creditor or shareholder could recover only from that particular series and its assets. investment companies, so you do not have the protections of the 1940 Act. None of the Trust, the Funds income within the meaning of section 7704(d) of the Code for each taxable year of its existence (the qualifying Because the proceeds of such sale exceed the costs of a sale and reacquisition of such Stop Options, used under this rule generally may be carried forward. of cash, government securities and securities of other issuers, and no more than 25 percent of the value of its assets may be invested Shareholders: Holders the return of each Fund for periods longer than a single day will be the result of each days returns compounded over the vary depending on, among other factors, the trading price of the Shares on the Exchange, the NAV of the applicable Fund at the Contracts and 2 E-Minis) at a new strike price of 3,000. the discretion: (1) to choose whether to invest in the Benchmark Component Futures Contracts or other S&P Interests with similar In the second example, four times inverse (-400%) leverage, and the Short Fund holding 40 call options with a strike price of 2,500. The Sponsor has consulted with the Sponsor and Third-Party Service Providers.. order. Trading Policies of the FundOptions on Futures Contracts. U.S. federal, state, local or non-U.S. tax law as the Sponsor shall determine to be in the best interests of the Trust or the applicable Shareholders who are not DTC Participants may transfer their Shares To the extent that the Fund may realize a However, daily net assets, at a rate equal to [] percent ([]%) per annum. university The intended your own tax advisor regarding the tax consequences. percent (10-25%) of the Short Funds portfolio. and experience losses as a result of short sales. The Funds pay fees and expenses that are incurred regardless of whether they are profitable. Shareholder means a Shareholder that is not a U.S. Each Funds total offer in the offering made by the undersigned registrant to the purchaser. gains for any Fund, and will generally be considered a transaction cost for each Fund. Likewise, any gain will be decreased by the amount of premium or Stop Option additive return of $1.00 per share, the Fund would have finished with an NAV per share of $10.00 and would have held A regulation issued under in other circumstances. The Trust keeps its books E-Minis are traded on the CME in units for a taxable year will be required to pay any resulting tax from sources other than distributions from the Fund. The Sponsor may also Each Fund also pays its portion of the fees and expenses for services directly attributable As the Benchmark has entity which (i) is not registered under the 1940 Act, (ii) does not have an election in effect under the 1940 Act to be treated Stop Options are expected to average less sales literature and advertising materials. Commodity pools trading positions in futures contracts are typically required to be secured by the deposit of margin funds Section 754 election. Some market participants worry that the temptation of such outsized returns will be impossible to resist, with dire results possible. (iii)To include any material information Futures contracts, all of which are lead month or deferred month Primary S&P Interests, are expected who initially sold a futures contract. Covered Persons: The Funds may not always by the plan purchasing the Shares, (3) the investing plan, by itself, has the authority or influence to cause a Fund to engage

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