逐筆明細 標的:
Tradr TSLA 熊證 Daily etf
逐筆明細 標的: TSLQ
Tradr 1.25X NVDA 熊日etf
逐筆明細: NVDS
每一個投資經理系列信託II （以下簡稱「信託」）
2024年5月15日的補充資料，適用於招股說明書、摘要招股說明書和
附加信息聲明（「SAI」），每份資料日期爲2023年7月31日，經過補充。
關於計劃中的基金名稱、投資目標和主要投資策略的重大通知
根據AXS投資公司的建議 作爲所有基金類型的顧問，信託的董事會已批准對每個基金的名稱、投資 目標和投資策略進行以下更改。每個基金目前 seeks 提供對基礎安防-半導體表現的反向或反向槓桿倍數。這些更改預計將在2024年7月15日或其周圍實施（「生效日期」），將如下面詳細討論的那樣，導致每個基金的反向槓桿倍數增加。 這些更改 將增加對任何基金的投資風險，因爲它們將導致基金槓桿的增加。
基金名稱更改
生效日期起，每個基金的名稱將更改如下：
| 當前基金名稱 | 新基金名稱 |
| Tradr 開空 創新 日常 etf | Tradr 2X 開空創新日報 etf |
| Tradr TSLA 看空每日ETF | Tradr 2X Short TSLA Daily ETF |
| Tradr 1.25倍 NVDA 熊 日常 etf | Tradr 1.5X Short NVDA Daily ETF |
Tradr 2X 開空創新每日 etf 的投資目標、主要投資策略和主要風險的變更
自生效日期起，基金的投資目標將更改如下：
Tradr 2倍開空創新日常etf （「基金」）尋求每日投資結果，在費用和支出之前，爲每日價格和收益表現的兩倍負數（-200%）與ark innovation etf的表現。基金不尋求在與交易日不同的時間段實現其所述的投資目標。
自生效日期起，基金主要投資策略下的第一個段落將被以下內容替換：
該 基金是一種主動管理的交易所交易基金，旨在通過對ark innovation etf進行一項或多項掉期交易，在單日內實現其回報的兩倍反向（-200%）（而不是任何其他期間）。"單日"是指基金計算其資產淨值時到基金下次計算資產淨值時的時間。
1
此外，第四段的第一句話 在基金的主要投資策略下被替換爲如下內容：
基金顧問預計每天重新平衡基金的持倉，以試圖保持基金與 ARK 創新 ETF 的開空暴露相等，因爲每日重新平衡和隨着時間推移每日回報的複利作用，基金長於單日的回報期間的回報將由該期間每日回報複利的結果決定，這很可能與同期內 ARK 創新 ETF 的回報的-200%有所不同。
自生效日期起，基金的某些風險將更新如下：
複利和市場波動的影響 風險。基金設定單日投資目標，基金在任何其他時期的表現都是其回報的結果 在此期間每天覆利。基金在超過一天的時間內的業績很可能會在金額上有所不同, 甚至可能是方向，在計入費用之前，從同期Ark Innovation ETF每日回報率的-200％開始 和開支。複利會影響所有投資，但對槓桿基金的影響更爲顯著。這種效果變得更加明顯 隨着方舟創新ETF的波動性和持有期的增加。超過一天的基金表現 可以根據以下因素的任何一組假設進行估計：(a) 波動性；(b) 業績；(c) 時期；(d) 融資 與槓桿風險敞口相關的費率；以及 (e) 其他基金支出。下圖說明了兩個主要因素的影響 — 方舟創新ETF的波動率和方舟創新ETF的表現——取決於基金的表現。該圖表顯示了基金的估計回報 以方舟創新ETF的波動率和方舟創新ETF在一年內的表現爲多種組合。實際波動率， 而方舟創新ETF和基金的表現可能與下圖有很大差異。圖表中顯示的性能假設：(a) 無基金支出；以及（b）借款/貸款利率（以獲得槓桿敞口）爲零。如果基金支出和/或實際借款/ 貸款利率得到反映，基金的業績將低於顯示的水平。
2
下面的圖表顯示，如果ark innovation etf在一年內沒有回報，而其年化波動率爲25%，基金預計將損失17.0%。在更高的波動率範圍內，即使ark innovation etf的回報持平，基金也有可能遭受顯著的價值損失。例如，如果ark innovation etf的年化波動率爲100%，基金預計將損失95.3%的價值，即使ark innovation etf的年回報爲0%。陰影區域爲紅色（或深灰色）代表那些基金預計回報低於ark innovation etf表現的-200%的情況，陰影區域爲綠色（或淺灰色）代表那些基金預計回報高於ark innovation etf表現的-200%的情況。下面的表格並不代表基金的實際回報，可能由於本文討論的任何風險因素而顯著優於或低於下面顯示的回報。
| -200%的 | ARK創新ETF的波動性（年化） | |||||||
| 一年 表現 ARK 創新 etf | 一年 | 10% | 25% | 50% | 75% | 100% | 125% | 150% |
| -95% | 190% | 36110.9% | 31935.5% | 18570.8% | 7461.0% | 2021.9% | 292.9% | -53.9% |
| -90% | 180% | 9182.7% | 7895.4% | 4554.8% | 1756.7% | 406.8% | -8.5% | -89.3% |
| -80% | 160% | 2261.3% | 1930.1% | 1074.3% | 367.1% | 23.9% | -78.0% | -97.5% |
| -70% | 140% | 962.0% | 810.9% | 421.8% | 108.1% | -45.0% | -90.4% | -99.0% |
| -60% | 120% | 500.9% | 415.3% | 196.2% | 15.3% | -69.1% | -94.7% | -99.4% |
| -50% | 100% | 286.3% | 230.5% | 89.7% | -25.6% | -80.5% | -96.7% | -99.7% |
| -40% | 80% | 168.8% | 130.4% | 31.6% | -48.3% | -86.9% | -97.8% | -99.8% |
| -30% | 60% | 98.0% | 69.3% | -3.3% | -62.4% | -90.3% | -98.4% | -99.8% |
| -20% | 40% | 51.6% | 29.8% | -26.1% | -71.8% | -92.6% | -98.8% | -99.9% |
| -10% | 20% | 19.8% | 2.4% | -41.6% | -77.5% | -94.2% | -99.0% | -99.9% |
| 0% | 0% | -2.9% | -17.0% | -52.7% | -81.8% | -95.3% | -99.2% | -99.9% |
| 10% | -20% | -19.8% | -31.4% | -61.2% | -84.9% | -96.2% | -99.4% | -99.9% |
| 20% | -40% | -32.6% | -42.4% | -67.4% | -87.5% | -96.7% | -99.4% | -100.0% |
| 30% | -60% | -42.6% | -51.0% | -72.2% | -89.4% | -97.3% | -99.6% | -100.0% |
| 40% | -80% | -50.6% | -57.7% | -76.1% | -90.7% | -97.7% | -99.6% | -100.0% |
| 50% | -100% | -56.9% | -63.3% | -79.2% | -92.0% | -97.9% | -99.7% | -100.0% |
| 60% | -120% | -62.2% | -67.7% | -81.9% | -93.1% | -98.2% | -99.7% | -100.0% |
| 70% | -140% | -66.5% | -71.4% | -83.9% | -93.8% | -98.5% | -99.7% | -100.0% |
| 80% | -160% | -70.2% | -74.6% | -85.6% | -94.4% | -98.6% | -99.8% | -100.0% |
| 90% | -180% | -73.3% | -77.2% | -87.2% | -95.2% | -98.7% | -99.8% | -100.0% |
| 100% | -200% | -74.6% | -78.3% | -87.7% | -95.4% | -98.9% | -99.8% | -100.0% |
The ARK Innovation ETF’s annualized historical volatility rate for the five-year period ended December 31, 2023, was 46.73%. The highest calendar year annualized volatility was 67.95% in 2022. The ARK Innovation ETF’s annualized performance for the five-year period ended December 31, 2023, was 7.75%. Historical ARK Innovation ETF volatility and performance are not indications of what the ARK Innovation ETF's volatility and performance will be in the future. The volatility of the securities that reflect the value of the ARK Innovation ETF, such as swaps, may differ from the volatility of the ARK Innovation ETF.
Leverage Risk. Leverage increases the risk of a total loss of an investor’s investment, may increase the volatility of the Fund, and may magnify any differences between the performance of the Fund and ARK Innovation ETF. Because the Fund includes a multiplier of negative of two times (-200%) ARK Innovation ETF, a single day movement in ARK Innovation ETF approaching 50% at any point in the day could result in the total loss of an investor’s investment if that movement is contrary to the investment objective of the Fund, even if ARK Innovation ETF subsequently moves in an opposite direction, eliminating all or a portion of the earlier movement. This would be the case with any such single day movements in ARK Innovation ETF, even if ARK Innovation ETF maintains a level greater than zero at all times.
Correlation Risk. A number of factors may affect the Fund’s ability to achieve a high degree of correlation with ARK Innovation ETF, and there is no guarantee that the Fund will achieve a high degree of correlation. Failure to achieve a high degree of correlation may prevent the Fund from achieving its investment objective, and the percentage change of the Fund’s NAV each day may differ, perhaps significantly in amount, and possibly even direction, from -200% of the percentage change of ARK Innovation ETF on such day.
In order to achieve a high degree of correlation with ARK Innovation ETF, the Fund seeks to rebalance its portfolio daily to keep exposure consistent with its investment objective. Being materially under- or overexposed to ARK Innovation ETF may prevent the Fund from achieving a high degree of correlation with ARK Innovation ETF and may expose the Fund to greater leverage risk. Market disruptions or closure, regulatory restrictions, market volatility, illiquidity in the markets for the financial instruments in which the Fund invests, and other factors will adversely affect the Fund’s ability to adjust exposure to requisite levels. The target amount of portfolio exposure is impacted dynamically by ARK Innovation ETF’s movements, including intraday movements. Because of this, it is unlikely that the Fund will have perfect -200% exposure during the day or at the end of each day and the likelihood of being materially under- or overexposed is higher on days when ARK Innovation ETF is volatile, particularly when ARK Innovation ETF is volatile at or near the close of the trading day.
3
A number of other factors may also adversely affect the Fund’s correlation with ARK Innovation ETF, including fees, expenses, transaction costs, financing costs associated with the use of derivatives, income items, valuation methodology, accounting standards and disruptions or illiquidity in the markets for the securities or financial instruments in which the Fund invests. The Fund may take or refrain from taking positions in order to improve tax efficiency, comply with regulatory restrictions, or for other reasons, each of which may negatively affect the Fund’s correlation with ARK Innovation ETF. The Fund may also be subject to large movements of assets into and out of the Fund, potentially resulting in the Fund being under- or overexposed to ARK Innovation ETF. Additionally, the Fund’s underlying investments and/or reference assets may trade on markets that may not be open on the same day as the Fund, which may cause a difference between the changes in the daily performance of the Fund and changes in the performance of ARK Innovation ETF. Any of these factors could decrease correlation between the performance of the Fund and ARK Innovation ETF and may hinder the Fund’s ability to meet its daily investment objective on or around that day.
Effective on the Effective Date, the Fund’s investment objective will be changed as follows:
The Tradr 2X Short TSLA Daily ETF seeks daily investment results, before fees and expenses, that correspond to two times the inverse (-200%) of the daily performance of the common shares of Tesla, Inc. The Fund does not seek to achieve its stated investment objective for a period of time different than a trading day.
Effective on the Effective date, the first paragraph under the Fund’s principal investment strategies is replaced with the following:
Under normal market circumstances, the Fund will maintain at least 80% exposure to financial instruments that provide inverse exposure to two times the daily performance of TSLA. The Fund is an actively-managed exchange-traded fund (“ETF”) that seeks to achieve on a daily basis, before fees and expenses, -200% performance of TSLA for a single day, not for any other period, by entering into one or more swaps on TSLA. A “single day” is measured from the time the Fund calculates its net asset value (“NAV”) to the time of the Fund’s next NAV calculation.
Additionally, the third sentence of the second paragraph under the Fund’s principal investment strategies is replaced with the following:
The Advisor expects to rebalance the Fund’s holdings daily in an attempt to maintain short exposure for the Fund equal to -200% of TSLA. Because of daily rebalancing and the compounding of each day’s return over time, the return of the Fund for periods longer than a single day will be the result of each day’s returns compounded over the period, which will very likely differ from -200% of the return of Tesla, Inc. over the same period.
Effective on the Effective Date, certain risks of the Fund will be updated as follows:
Effects of Compounding and Market Volatility Risk. The Fund has a single day investment objective, and the Fund’s performance for any other period is the result of its return for each day compounded over the period. The performance of the Fund for periods longer than a single day will very likely differ in amount, and possibly even direction, from -200% of the daily return of TSLA for the same period, before accounting for fees and expenses. Compounding affects all investments, but has a more significant impact on funds that are leveraged and that rebalance daily. This effect becomes more pronounced as TSLA’s volatility and the holding periods increase. Fund performance for a period longer than a single day can be estimated given any set of assumptions for the following factors: (a) TSLA volatility; (b) TSLA performance; (c) period of time; (d) financing rates associated with leveraged exposure; and (e) other Fund expenses. The chart below illustrates the impact of two principal factors — TSLA volatility and TSLA performance — on Fund performance. The chart shows estimated Fund returns for a number of combinations of TSLA volatility and TSLA performance over a one-year period. Actual volatility, TSLA and Fund performance may differ significantly from the chart below. Performance shown in the chart assumes: (a) no Fund expenses; and (b) borrowing/lending rates (to obtain leveraged exposure) of zero percent. If Fund expenses and/or actual borrowing/ lending rates were reflected, the Fund’s performance would be lower than shown.
4
As shown in the chart below, the Fund would be expected to lose 17.0% if TSLA provided no return over a one year period during which TSLA experienced annualized volatility of 25%. At higher ranges of volatility, there is a chance of a significant loss of value in the Fund, even if TSLA’s return is flat. For instance, if TSLA’s annualized volatility is 100%, the Fund would be expected to lose 95.3% of its value, even if TSLA’s cumulative return for the year was 0%. Areas shaded red (or dark gray) represent those scenarios where the Fund can be expected to return less than -200% of the performance of TSLA and those shaded green (or light gray) represent those scenarios where the Fund can be expected to return more than -200% of the performance of TSLA. The table below is not a representation of the Fund’s actual returns, which may be significantly better or worse than the returns shown below as a result of any of the risk factors discussed herein.
| -200% of | Volatility of the Underlying Stock (annualized) | |||||||
| One Year Performance of Underlying Stock | One Year | 10% | 25% | 50% | 75% | 100% | 125% | 150% |
| -95% | 190% | 36110.9% | 31935.5% | 18570.8% | 7461.0% | 2021.9% | 292.9% | -53.9% |
| -90% | 180% | 9182.7% | 7895.4% | 4554.8% | 1756.7% | 406.8% | -8.5% | -89.3% |
| -80% | 160% | 2261.3% | 1930.1% | 1074.3% | 367.1% | 23.9% | -78.0% | -97.5% |
| -70% | 140% | 962.0% | 810.9% | 421.8% | 108.1% | -45.0% | -90.4% | -99.0% |
| -60% | 120% | 500.9% | 415.3% | 196.2% | 15.3% | -69.1% | -94.7% | -99.4% |
| -50% | 100% | 286.3% | 230.5% | 89.7% | -25.6% | -80.5% | -96.7% | -99.7% |
| -40% | 80% | 168.8% | 130.4% | 31.6% | -48.3% | -86.9% | -97.8% | -99.8% |
| -30% | 60% | 98.0% | 69.3% | -3.3% | -62.4% | -90.3% | -98.4% | -99.8% |
| -20% | 40% | 51.6% | 29.8% | -26.1% | -71.8% | -92.6% | -98.8% | -99.9% |
| -10% | 20% | 19.8% | 2.4% | -41.6% | -77.5% | -94.2% | -99.0% | -99.9% |
| 0% | 0% | -2.9% | -17.0% | -52.7% | -81.8% | -95.3% | -99.2% | -99.9% |
| 10% | -20% | -19.8% | -31.4% | -61.2% | -84.9% | -96.2% | -99.4% | -99.9% |
| 20% | -40% | -32.6% | -42.4% | -67.4% | -87.5% | -96.7% | -99.4% | -100.0% |
| 30% | -60% | -42.6% | -51.0% | -72.2% | -89.4% | -97.3% | -99.6% | -100.0% |
| 40% | -80% | -50.6% | -57.7% | -76.1% | -90.7% | -97.7% | -99.6% | -100.0% |
| 50% | -100% | -56.9% | -63.3% | -79.2% | -92.0% | -97.9% | -99.7% | -100.0% |
| 60% | -120% | -62.2% | -67.7% | -81.9% | -93.1% | -98.2% | -99.7% | -100.0% |
| 70% | -140% | -66.5% | -71.4% | -83.9% | -93.8% | -98.5% | -99.7% | -100.0% |
| 80% | -160% | -70.2% | -74.6% | -85.6% | -94.4% | -98.6% | -99.8% | -100.0% |
| 90% | -180% | -73.3% | -77.2% | -87.2% | -95.2% | -98.7% | -99.8% | -100.0% |
| 100% | -200% | -74.6% | -78.3% | -87.7% | -95.4% | -98.9% | -99.8% | -100.0% |
TSLA’s annualized historical volatility rate for the five-year period ended December 31, 2023, was 64.72%. TSLA’s highest calendar year annualized volatility was 89.64% in 2020. TSLA’s annualized total return performance for the five-year period ended December 31, 2023, was 64.62%. Historical volatility and performance are not indications of what TSLA volatility and performance will be in the future.
Leverage Risk. Leverage increases the risk of a total loss of an investor’s investment, may increase the volatility of the Fund, and may magnify any differences between the performance of the Fund and TSLA. Because the Fund includes a multiplier of negative of two times (-200%) TSLA, a single day movement in TSLA approaching 50% at any point in the day could result in the total loss of an investor’s investment if that movement is contrary to the investment objective of the Fund, even if TSLA subsequently moves in an opposite direction, eliminating all or a portion of the earlier movement. This would be the case with any such single day movements in TSLA, even if TSLA maintains a level greater than zero at all times.
5
Correlation Risk. A number of factors may affect the Fund’s ability to achieve a high degree of correlation with TSLA, and there is no guarantee that the Fund will achieve a high degree of correlation. Failure to achieve a high degree of correlation may prevent the Fund from achieving its investment objective, and the percentage change of the Fund’s NAV each day may differ, perhaps significantly in amount, and possibly even direction, from -200% of the percentage change of TSLA on such day.
In order to achieve a high degree of correlation with TSLA, the Fund seeks to rebalance its portfolio daily to keep exposure consistent with its investment objective. Being materially under- or overexposed to TSLA may prevent the Fund from achieving a high degree of correlation with TSLA and may expose the Fund to greater leverage risk. Market disruptions or closure, regulatory restrictions, market volatility, illiquidity in the markets for the financial instruments in which the Fund invests, and other factors will adversely affect the Fund’s ability to adjust exposure to requisite levels. The target amount of portfolio exposure is impacted dynamically by TSLA’s movements, including intraday movements. Because of this, it is unlikely that the Fund will have perfect -200% exposure during the day or at the end of each day and the likelihood of being materially under- or overexposed is higher on days when TSLA is volatile, particularly when TSLA is volatile at or near the close of the trading day.
A number of other factors may also adversely affect the Fund’s correlation with TSLA, including fees, expenses, transaction costs, financing costs associated with the use of derivatives, income items, valuation methodology, accounting standards and disruptions or illiquidity in the markets for the securities or financial instruments in which the Fund invests. The Fund may take or refrain from taking positions in order to improve tax efficiency, comply with regulatory restrictions, or for other reasons, each of which may negatively affect the Fund’s correlation with TSLA. The Fund may also be subject to large movements of assets into and out of the Fund, potentially resulting in the Fund being under- or overexposed to TSLA. Additionally, the Fund’s underlying investments and/or reference assets may trade on markets that may not be open on the same day as the Fund, which may cause a difference between the changes in the daily performance of the Fund and changes in the performance of TSLA. Any of these factors could decrease correlation between the performance of the Fund and TSLA and may hinder the Fund’s ability to meet its daily investment objective on or around that day.
Effective on the Effective Date, the Fund’s investment objective will be changed as follows:
The Tradr 1.5X Short NVDA Daily ETF seeks daily investment results, before fees and expenses, that correspond to one and a half times the inverse (-150%) of the daily performance of the common shares of NVIDIA Corporation. The Fund does not seek to achieve its stated investment objective for a period of time different than a trading day.
Effective on the Effective date, the first paragraph under the Fund’s principal investment strategies is replaced with the following:
Under normal market circumstances, the Fund will maintain at least 80% exposure to financial instruments that provide one and a half times inverse leveraged exposure to the daily performance of NVDA. The Fund is an actively-managed exchange-traded fund (“ETF”) that seeks to achieve on a daily basis, before fees and expenses, -150% performance of NVDA for a single day, not for any other period, by entering into one or more swaps on NVDA. A “single day” is measured from the time the Fund calculates its net asset value (“NAV”) to the time of the Fund’s next NAV calculation.
In addition, the third sentence of the second paragraph under the Fund’s principal investment strategies is replaced with the following:
The Advisor attempts to consistently apply leverage to increase the Fund’s exposure to -150% of NVDA and expects to rebalance the Fund’s holdings daily to maintain such exposure. Because of daily rebalancing and the compounding of each day’s return over time, the return of the Fund for periods longer than a single day will be the result of each day’s returns compounded over the period, which will very likely differ from -150% of the return of NVIDIA Corporation over the same period.
6
Effective on the Effective Date, certain risks of the Fund will be updated as follows:
Effects of Compounding and Market Volatility Risk. The Fund has a single day investment objective, and the Fund’s performance for any other period is the result of its return for each day compounded over the period. The performance of the Fund for periods longer than a single day will very likely differ in amount, and possibly even direction, from -150% of the daily return of NVDA for the same period, before accounting for fees and expenses. Compounding affects all investments, but has a more significant impact on a leveraged fund. This effect becomes more pronounced as NVDA’s volatility and the holding periods increase. Fund performance for a period longer than a single day can be estimated given any set of assumptions for the following factors: (a) NVDA volatility; (b) NVDA performance; (c) period of time; (d) financing rates associated with leveraged exposure; and (e) other Fund expenses. The chart below illustrates the impact of two principal factors — NVDA volatility and NVDA performance — on Fund performance. The chart shows estimated Fund returns for a number of combinations of NVDA volatility and NVDA performance over a one-year period. Actual volatility, NVDA and Fund performance may differ significantly from the chart below. Performance shown in the chart assumes: (a) no Fund expenses; and (b) borrowing/lending rates (to obtain leveraged exposure) of zero percent. If Fund expenses and/or actual borrowing/ lending rates were reflected, the Fund’s performance would be lower than shown.
As shown in the chart below, the Fund would be expected to lose 11.0% if NVDA provided no return over a one year period during which NVDA experienced annualized volatility of 25%. At higher ranges of volatility, there is a chance of a significant loss of value in the Fund, even if NDVA’s return is flat. For instance, if NDVA’s annualized volatility is 100%, the Fund would be expected to lose 85.2% of its value, even if NDVA’s cumulative return for the year was 0%. Areas shaded red (or dark gray) represent those scenarios where the Fund can be expected to return less than -150% of the performance of NDVA and those shaded green (or light gray) represent those scenarios where the Fund can be expected to return more than -150% of the performance of NDVA. The table below is not a representation of the Fund’s actual returns, which may be significantly better or worse than the returns shown below as a result of any of the risk factors discussed herein.
| -150% of | Volatility of the Underlying Stock (annualized) | |||||||
| One Year Performance of the Underlying Stock | One Year | 10% | 25% | 50% | 75% | 100% | 125% | 150% |
| -95% | 143% | 7377.2% | 6520.9% | 4593.2% | 2581.4% | 1102.2% | 318.8% | 15.1% |
| -90% | 135% | 2917.4% | 2656.4% | 1860.0% | 1006.2% | 387.1% | 71.6% | -53.5% |
| -80% | 120% | 980.7% | 881.5% | 595.3% | 291.9% | 74.1% | -40.3% | -84.2% |
| -70% | 105% | 492.1% | 437.6% | 281.0% | 112.8% | -6.6% | -67.7% | -91.5% |
| -60% | 90% | 286.1% | 250.2% | 147.6% | 38.7% | -39.2% | -79.5% | -94.6% |
| -50% | 75% | 176.6% | 151.0% | 77.6% | -1.0% | -57.0% | -85.3% | -96.2% |
| -40% | 60% | 111.0% | 91.3% | 35.1% | -24.7% | -67.2% | -88.9% | -97.1% |
| -30% | 45% | 67.5% | 51.8% | 7.0% | -40.6% | -74.2% | -91.2% | -97.8% |
| -20% | 30% | 37.2% | 24.4% | -12.3% | -51.6% | -78.9% | -92.9% | -98.2% |
| -10% | 15% | 15.0% | 4.2% | -26.9% | -59.5% | -82.4% | -94.1% | -98.5% |
| 0% | 0% | -1.9% | -11.0% | -37.3% | -65.3% | -85.2% | -94.9% | -98.7% |
| 10% | -15% | -14.9% | -22.9% | -45.9% | -69.9% | -87.0% | -95.6% | -98.9% |
| 20% | -30% | -25.4% | -32.4% | -52.5% | -73.7% | -88.7% | -96.3% | -99.0% |
| 30% | -45% | -33.8% | -40.0% | -57.8% | -76.7% | -90.0% | -96.6% | -99.2% |
| 40% | -60% | -40.8% | -46.4% | -62.2% | -79.1% | -91.1% | -97.0% | -99.2% |
| 50% | -75% | -46.7% | -51.7% | -66.0% | -81.3% | -91.9% | -97.4% | -99.3% |
| 60% | -90% | -51.6% | -56.2% | -69.3% | -83.0% | -92.6% | -97.5% | -99.4% |
| 70% | -105% | -55.8% | -60.0% | -71.9% | -84.6% | -93.3% | -97.7% | -99.4% |
| 80% | -120% | -59.5% | -63.3% | -74.3% | -85.8% | -93.9% | -97.9% | -99.5% |
| 90% | -135% | -62.6% | -66.2% | -76.4% | -86.8% | -94.5% | -98.2% | -99.5% |
| 100% | -150% | -64.1% | -67.5% | -77.2% | -87.3% | -94.6% | -98.2% | -99.6% |
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NVDA’s annualized historical volatility rate for the five-year period ended December 31, 2023, was 51.79%. NVDA’s highest calendar year annualized volatility rate was 63.42% in 2022. NVDA’s annualized total return performance for the five-year period ended December 31, 2023, was 71.30%. Historical NVDA volatility and performance are not indications of what NVDA volatility and performance will be in the future. The volatility of U.S. exchange-traded securities or instruments that reflect the value of NVDA may differ from the volatility of NVDA.
Leverage Risk. Leverage increases the risk of a total loss of an investor’s investment, may increase the volatility of the Fund, and may magnify any differences between the performance of the Fund and NVDA. Because the Fund includes a multiplier of negative one and a half times (-150%) NVDA, a single day movement in NVDA approaching 67% at any point in the day could result in the total loss of an investor’s investment if that movement is contrary to the investment objective of the Fund, even if NVDA subsequently moves in an opposite direction, eliminating all or a portion of the earlier movement. This would be the case with any such single day movements in NVDA, even if NVDA maintains a level greater than zero at all times.
Correlation Risk. A number of factors may affect the Fund’s ability to achieve a high degree of correlation with NVDA, and there is no guarantee that the Fund will achieve a high degree of correlation. Failure to achieve a high degree of correlation may prevent the Fund from achieving its investment objective, and the percentage change of the Fund’s NAV each day may differ, perhaps significantly in amount, and possibly even direction, from -150% of the percentage change of NVDA on such day.
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In order to achieve a high degree of correlation with NVDA, the Fund seeks to rebalance its portfolio daily to keep exposure consistent with its investment objective. Being materially under- or overexposed to NVDA may prevent the Fund from achieving a high degree of correlation with NVDA and may expose the Fund to greater leverage risk. Market disruptions or closure, regulatory restrictions, market volatility, illiquidity in the markets for the financial instruments in which the Fund invests, and other factors will adversely affect the Fund’s ability to adjust exposure to requisite levels. The target amount of portfolio exposure is impacted dynamically by NVDA’s movements, including intraday movements. Because of this, it is unlikely that the Fund will have perfect -150% exposure during the day or at the end of each day and the likelihood of being materially under- or overexposed is higher on days when NVDA is volatile, particularly when NVDA is volatile at or near the close of the trading day.
A number of other factors may also adversely affect the Fund’s correlation with NVDA, including fees, expenses, transaction costs, financing costs associated with the use of derivatives, income items, valuation methodology, accounting standards and disruptions or illiquidity in the markets for the securities or financial instruments in which the Fund invests. The Fund may take or refrain from taking positions in order to improve tax efficiency, comply with regulatory restrictions, or for other reasons, each of which may negatively affect the Fund’s correlation with NVDA. The Fund may also be subject to large movements of assets into and out of the Fund, potentially resulting in the Fund being under- or overexposed to NVDA. Additionally, the Fund’s underlying investments and/or reference assets may trade on markets that may not be open on the same day as the Fund, which may cause a difference between the changes in the daily performance of the Fund and changes in the performance of NVDA. Any of these factors could decrease correlation between the performance of the Fund and NVDA and may hinder the Fund’s ability to meet its daily investment objective on or around that day.
Please file this Supplement with your records.
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