FTXL

About FTXL

The Fund will normally invest at least 90% of its net assets (including investment borrowings) in the securities that comprise the Index. The Fund, using an indexing investment approach, attempts to replicate, before fees and expenses, the performance of the Index. The Index is owned and is developed, maintained and sponsored by Nasdaq, Inc. (the “Index Provider”). The Index Provider may, from time to time, exercise reasonable discretion as it deems appropriate in order to ensure Index integrity.According to the Index Provider, the Index is designed to provide exposure to the 30 to 50 top factor-ranked securities from U.S. semiconductor companies. The Index’s initial selection universe consists of the component securities of the Nasdaq US BenchmarkTM Index that have been classified as comprising either the semiconductors or production technology equipment subsectors according to the Industry Classification Benchmark (the "ICB"). According to the ICB, companies comprising thesesubsectors include producers and distributors of semiconductors and other integrated chips, including other products related to the semiconductor industry, such as semiconductor capital equipment and motherboards and companies involved in the manufacture of high-technology tools and/or equipments that are used in the creation of semiconductors, photonics, wafers,and other high-technology components. The Nasdaq US BenchmarkTM Index is an index seeking to track the performance of small, mid and large capitalization U.S. companies. The Fund may invest in depositary receipts.After meeting certain size, float and liquidity standards of the Index, the Index Provider then ranks the remaining eligible stocks utilizing a factor model that considers: (1) gross income; (2) return on assets; and (3) momentum. A fourth factor, cash flow, is also considered for tie-breaking situations when other factors are inconclusive. The bottom 25% of stocks based on the aggregate rankings above will be eliminated, subject to a requirement that the Index have a total constituent count between 30 and 50 stocks.The Index assigns security weights based upon cash flow. However, the Index will not assign a security weight of greater than 8% and no more than five securities may be assigned the maximum 8% weight. The excess weight of any capped security is distributed proportionately across the remaining constituent securities. If, after redistribution, any of the five highest ranked securities have a weight of less than 8%, these securities are not capped. Any remaining securities with a weight in excess of 4% are capped at 4% and the excess weight is redistributed proportionally across the remaining constituent securities. If, after the redistribution process, a security has a weight less than 0.50%, weights are redistributed further in the process above such that no security has a weight less than 0.50%. The process is repeated, if necessary, to derive the final weights.The Index is rebalanced and reconstituted semi-annually and the Fund will make corresponding changes to its portfolio shortly after the Index changes are made public. The Fund will be concentrated in an industry or a group of industries to the extent that the Index is so concentrated. As of June 28, 2024, the Index was composed of 31 securities with market capitalization ranges from $3.06 billion to $3.04 trillion. As of June 28, 2024, the Fund had significant investments in information technology companies, although this may change from time to time. The Fund's investments will change as the Index changes and, as a result, the Fund may have significant investments in jurisdictions or investment sectors that it may not have had as of June 28, 2024. To the extent the Fund invests a significant portion of its assets in a given jurisdiction or investment sector, the Fund may be exposed to the risks associated with that jurisdiction or investment sector.