FNGG

About FNGG

The Index is an equal-dollar weighted Index designed to track the performance of 10 highly-traded growth stocks of technology and tech-enabled companies. The Index is comprised of the securities of U.S.-listed companies that ICE Data Indices, LLC (the “Index Provider”) has identified as FANG+ companies, which are comprised of the six FAANMG companies and four non-FAANMG companies. The Index Provider defines the FAANMG companies as Meta Platforms Inc. (META), Apple Inc. (AAPL), Amazon.com Inc. (AMZN), Netflix Inc. (NFLX), Microsoft Corp. (MSFT), and Alphabet Inc. Class A (GOOGL). As of December 31, 2024, the four non-FAANMG companies are CrowdStrike Holdings Inc. (CRWD), NVIDIA Corp (NVDA), ServiceNow, Inc. (NOW), and Broadcom Inc. (AVGO). To be included in the Index, each constituent must meet the Selection Criteria described below. The starting universe from which Index constituents are selected is comprised of the common stocks of companies that are listed on the following U.S. exchanges: New York Stock Exchange, NASDAQ, NYSE American, NYSE Arca, and Cboe BZX. To be included in the Index, securities must: (i) have a full company market capitalization (including all listed and unlisted share classes) of at least $5 billion; (ii) have been actively trading for at least 60 calendar days on the specific share class included in the Index; (iii) have an average daily traded value (ADTV) of $50 million or greater over the preceding 6-month period, or over the applicable trading period of the security if its available trading history is less than 6 months, as of the reference date; (iv) have a U.S. country of incorporation and U.S. country of risk (i.e., the country where the majority of the underlying economic value of an instrument is derived, considering factors such as country of revenue, country of primary listing, reporting currency of the issuer, management location, and country of production); and (v) must be classified within one of select sub-industries belonging to the Consumer Discretionary, Media & Communications or Technology sectors based on the ICE Uniform Sector Classification schema (the “Selection Criteria”). The Index Provider expects that each of the six FAANMG securities will meet the Selection Criteria and be included in the Index. In order to select the remaining Index constituents, the non-FAANMG securities that meet the Selection Criteria are ranked in descending order by the following factors: (1) full company market capitalization (35% weight); (2) ADTV on the specific share class (35% weight); (3) price-to-sales ratio (measured over the last twelve months (“LTM”)) (15% weight); and (4) 1-year net sales growth (LTM) (15% weight) (the “Ranking Criteria”). The highest ranked non-FAANMG securities are selected for inclusion until the Index has a total of 10 constituents. If any of the six FAANMG securities do not qualify for inclusion based on the Selection Criteria, then the next highest ranked securities based on the Ranking Criteria are selected to maintain an Index constituent count of 10 securities. The Index is reconstituted quarterly and at each reconstitution, each constituent is attributed a 10% weight in the Index. As of December 31, 2024, the Index included 10 constituents which were concentrated in the communication services, information technology, and consumer discretionary sectors.The components of the Index and the percentages represented by various sectors in the Index may change over time. The Fund will concentrate its investment in a particular industry or group of industries (i.e., hold 25% or more of its total assets in the stocks of a particular industry or group of industries) to approximately the same extent as the Index is so concentrated.The Fund, under normal circumstances, invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments, such as swap agreements, securities of the Index, and exchange-traded funds ("ETFs") that track the Index, that, in combination, provide 2X daily leveraged exposure to the Index, consistent with the Fund's investment objective. The financial instruments in which the Fund most commonly invests are swap agreements and futures agreements which are intended to produce economically leveraged investment results.The Fund may invest in an ETF that tracks the Index or a substantially similar index, and may utilize derivatives, such as swaps or futures on the Index or on an ETF that tracks the same Index or a substantially similar index,, that provide leveraged exposure to the above. The Fund seeks to remain fully invested at all times, consistent with its stated investment objective, but may not always have investment exposure to all of the securities in the Index, or its weighting of investment exposure to securities or industries may be different from that of the Index. In addition, the Fund may invest directly or indirectly in securities not included in the Index. In all cases, the investments would be designed to help the Fund track the Index. The Fund will attempt to achieve its investment objective without regard to overall market movement or the increase or decrease of the value of the securities in the Index. At the close of the markets each trading day, Rafferty rebalances the Fund’s portfolio so that its exposure to the Index is consistent with the Fund’s investment objective. The impact of the Index’s movements during the day will affect whether the Fund’s portfolio needs to be re-positioned. For example, if the Index has risen on a given day, net assets of the Fund should rise, meaning that the Fund’s exposure will need to be increased. Conversely, if the Index has fallen on a given day, net assets of the Fund should fall, meaning the Fund’s exposure will need to be reduced. This re-positioning strategy typically results in high portfolio turnover. On a day-to-day basis, the Fund is expected to hold ETFs and money market funds, deposit accounts with institutions with high quality credit ratings (i.e., investment grade or higher), and/or short-term debt instruments that have terms-to-maturity of less than 397 days and exhibit high quality credit profiles, including U.S. government securities and repurchase agreements. The Fund may lend securities representing up to one-third of the value of the Fund’s total assets (excluding the value of the collateral received). The terms “daily,” “day,” and “trading day,” refer to the period from the close of the markets on one trading day to the close of the markets on the next trading day. The Fund is “non-diversified,” meaning that a relatively high percentage of its assets may be invested in a limited number of issuers of securities. Additionally, the Fund’s investment objective is not a fundamental policy and may be changed by the Fund’s Board of Trustees without shareholder approval.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 the Index over the same period. The Fund will lose money if the Index performance is flat over time, and as a result of daily rebalancing, the Index’s volatility and the effects of compounding, it is even possible that the Fund will lose money over time while the Index’s performance increases over a period longer than a single day.