XMHQ

About XMHQ

TheFund generally will invest at least 90% of its total assets in securities that comprise the Underlying Index.Strictlyin accordance with its guidelines and mandated procedures, S&PDow Jones Indices LLC (“S&P DJI” or the “Index Provider”) compiles, maintains and calculates the UnderlyingIndex, which is composed of a subset of securitiesfrom the S&P MidCap 400®Index that the Index Provider has determined to have high “quality”—that is, stocks of companies that seek to generatehigher revenue and cash flow than their counterparts through prudent use of assets and finances. The Index Provider assesses a security’squality based on the following three fundamental measures: return on equity, accruals ratio and financial leverage ratio. Return on equityis calculated as the company’s trailing 12-month earnings per share divided by the company’s latest book value per share.Accruals ratio is computed using the change of the company’s net operating assets over the last year divided by the company’saverage total assets over the last two years. Financial leverage is calculated as the company’s latest total debt divided by thecompany’s book value. The Index Provider assesses the quality of securities of companies in the financials or real estate sectors(according to the Global Industry Classification Standard (“GICS®”))based only on the return on equity and financial leverage ratio measures.Inselecting constituent securities for the Underlying Index, the Index Providercalculates the quality score of each security in the S&P MidCap 400®Index and then selects the 80 stocks with the highest quality score for inclusion in the Underlying Index. The Index Provider weightseach component stock of the Underlying Index by the product of its quality score multiplied by its market capitalization in the eligibleuniverse, subject to security and sector constraints and optimization procedures. Stocks with higher scores receive relatively greaterweights. Asof June 30, 2023, the Underlying Index was comprised of 80 constituentswith market capitalizations ranging from $1.8 billion to $17.8 billion.TheFund employs a “full replication” methodology in seeking to track theUnderlying Index, meaning that the Fund generally invests in all of the securities comprising the Underlying Index in proportion to theirweightings in the Underlying Index.TheFund intends to be “diversified,” as defined in theInvestment Company Act of 1940, as amended (the “1940 Act”), to the extent that the Underlying Index is diversified. The Fundmay become “non-diversified” as defined in the 1940 Act solely as a result of a change in relative market capitalization orindex weighting of one or more constituents of the Underlying Index. Should the Fund become “non-diversified,” it will nolonger be required to meet certain diversification requirements under the 1940 Actand may invest a greater portion of its assets in securities ofa small group of issuers or in any one individual issuer than can a diversified fund. Shareholder approval will not be sought when theFund crosses from diversified to non-diversified status solely due to a change in relative market capitalization or index weighting ofone or more constituents of the Underlying Index. In seeking to track the Underlying Index, the Fund was managed as diversified as ofApril 30, 2023.ConcentrationPolicy. TheFund will concentrate its investments (i.e., invest 25% or more of the value of its total assets) in securities of issuers in any oneindustry or group of industries only to the extent that the Underlying Index reflects a concentration in that industry or group of industries.The Fund will not otherwise concentrate its investments in securities of issuers in any one industry or group of industries. As of April30, 2023, the Fund had significant exposure to the industrials sector. The Fund’s portfolio holdings, and the extent to which itconcentrates its investments, are likely to change over time.