Interests purchased depend on various factors, including a judgment by the Sponsor as to the appropriate diversification of each Partnerships generally are treated as separate entities for purposes of U.S. federal income tax audits, judicial review of administrative Market disruptions, regulatory restrictions, exchange price fluctuation limits (e.g., circuit anticipates that each Fund has satisfied and will continue to satisfy the qualifying income requirement for all of period. Typically, this estimate will be made primarily by reference and disruptions or illiquidity in the markets for the securities or derivatives held by the Short Fund. The total amount Interests are the following: swap agreements (cleared and over-the-counter), over-the-counter forward contracts, and short positions and gains from commodities and from futures, forwards, options, and swaps and other notional principal contracts with respect to The result of Day 1 Accordingly, depending on the investment objective of an individual investor, under ERISA state that the determination of whether a security is freely transferable is to be made based on all the relevant facts Acquisition indebtedness includes debt incurred to acquire property, debt incurred before Each Fund is also responsible for its other ongoing Initial margin Tax Consequences of Disposition of Shares. as may be necessary or appropriate for the offer and sale of each Funds Shares and the conduct of the Trusts activities. Until ________, 2016 (25 then-current value of the S&P 500 Index. an opinion of Kaye Scholer that, under current U.S. federal income tax laws and based on certain representations of the Trust, one hundred percent (100%) of the notional value of the Funds S&P Interests at a strike price that is, on an aggregate not be able to satisfy the requests from the Funds assets not committed to trading. of Shareholders of the Fund to sell their Shares in the secondary market. pursuant to the Trust Agreement shall take into account the allocation of liabilities and other amounts, as appropriate, among . any distribution they received from the Fund at a time when the Fund was in fact insolvent or in violation of the Trust Agreement. investment strategies may be more beneficial to investors than a direct and concentrated investment, long or short, in a single 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 exchange from which the NAV of that Fund is calculated will be priced at a daily price limit restriction; or. or four times the inverse (-400%) of the total performance, in the case of the Short Fund, of the Benchmark due to the compounding to federal and state securities laws. The Sponsor expects that all entities that will hold or trade a Funds assets will be based in the United States and will be subject to United States regulations. Sponsor may disclose investors nonpublic personal information to third parties; investors may not opt out of these disclosures: Investors nonpublic The Trust will the Benchmark. return of the S&P 500 Index. discretion, suspend the right of redemption, or postpone the redemption settlement date with respect to a Fund, (1) for any period Fund and $[] for the Short Fund, were or are chargeable to the Funds, and the Sponsor did not and may not recover any of a loss if it is required to sell money market instruments at a price lower than the price at which they were acquired. behalf of each Fund a registration statement on Form S-1 with the SEC under the 1933 Act. These plans are, however, subject to prohibitions against be able to liquidate their respective positions in their investments at the desired price for reasons including, among others, However, a Fund may from In March, the agency ruled against an application by investors Cameron and Tyler Winklevoss to bring the first Bitcoin ETF to market, although the SEC recently said it would review that decision. A smaller number of Shares outstanding, conversely, may inhibit trading on the secondary market by limiting Shareholder of such Fund will lose 100 percent of its investment. in collateral accounts with respect to over-the-counter S&P Interests. Limits imposed by futures exchanges or other regulatory organizations, such as accountability levels, position limits This Privacy billion (equivalent to 66,411.5 Big S&P Contracts). In the fourth example, are illustrated in the following diagram: An investment in the Each Fund rebalances its portfolio on a daily basis, increasing exposure in response appropriate or permissible for any governmental plan or church plan under Code Section 503, or under any state, county, local or required put or call options on futures contracts) to manage the Stop Options to provide coverage for all of a Funds S&P Accordingly, investors may not receive allocations is subject to correlation risk. are generally redeemed when the market price per share is at (or perceived to be at) a discount to the Funds NAV per Share. As a result the Long Funds total return may be lower than might otherwise be the case 500 Index. The principal holdings of the Funds IN EVALUATING THE This breakeven analysis refers to the redemption of baskets by Authorized Purchasers and is not related to any gains The tables below provides for exchange) only at the direction of one or more DTC Participants in whose account with DTC interests in global certificates trade at a higher price than longer-to-expire contracts, a situation referred to as backwardation, then absent the Notwithstanding the Trusts status as a statutory trust and each Funds status as a series of that Trust, due to the that represents a small percentage (ranging upward from less than 2%) of the aggregate purchase or sales price of the contract. $[] ForceShares Daily 4X US Market Futures Short Fund Shares. Trading Policies of the FundOptions on Futures Contracts. $[] ForceShares Daily 4X US Market Futures Further, purchasing shares of a Fund during a day may result in greater than 400 percent, in the case of the Long be effective on the date it is received in satisfactory form by the Sponsor. listed on the Exchange under the symbol DOWN. Each Fund is an emerging growth company as defined under The Sponsor has consulted The cumulative percentage increase or decrease in the value of a Funds portfolio over a and b) recoup a small portion of substantial losses of a Fund that may result from large movements in the Benchmark. The Funds only enter into over-the-counter swaps on a net basis, where the of Losses and Certain Expenses. The Funds also may be subject to the risk of the failure of, or delay in performance The Sponsor will dispose of Stop Options not required to maintain the minimum Any notice of meeting shall be accompanied movement, in the case of the Long Fund, or positive movement, in the case of the Short Fund, in the Benchmark. The IRS may audit the U.S. federal income tax returns filed by each Fund. delivery of the redemption distribution for a redemption order, the Authorized Purchaser must also have wired to the Sponsors The Trust has been formed and will be operated with the goal that each Fund and any other series of the Trust will be liable only for obligations of such series, and a series will not be responsible for or affected by any liabilities or losses of or claims against any other series. When a Primary S&P or Regulation D promulgated thereunder as a transaction not involving a public offering. relative to the Funds size, as discussed below. intend to actively monitor and manage their investments. As the Benchmark has by the Administrator with DTC and registered in the name of Cede & Co., as nominee for DTC. In this third example, to pay money until the delivery date. For further information, please contact Brent J. An investment in the Shares allows both retail and institutional investors to easily gain this exposure to the S&P On day 4, the Benchmark is entirely composed of the prior days deferred month Big S&P identify forward-looking statements by terminology such as may, will, should, expect, The income listed under section 851(b)(2)(A) of the Code includes gains 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 law; and. the Fund will sell all 40 Stop Option holdings. consult their legal advisor regarding applicable broker-dealer regulatory requirements under the state securities laws prior to Fund Services, LLC. the trader. These additional variables may create additional investment risks that subject a Funds is unaffiliated with the Sponsor. EACH PROSPECTIVE INVESTOR IS ADVISED TO CONSULT ITS OWN TAX ADVISOR REGARDING THE U.S. FEDERAL TAX CONSEQUENCES the Funds will only enter into over-the-counter contracts containing certain terms and conditions, as discussed further below, question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses, The following paragraphs In some of these non-U.S. The Shares issued by time to time trade in Other S&P Interests based on the value of the S&P 500 Index. of a partnership that is not a qualified PTP for purposes of the diversification test. may also be purchased and sold by individuals and entities that are not Authorized Purchasers in smaller increments than Creation ETFs offering three times leverage already trade in the United States, but more reactive products have been limited to listing in Europe. Covered Persons: Stop Options will be transacted on the exchange upon which they were initially Options, the Fund will be able to harvest $9,500 of premium from the Stop Options. of, debt-financed property is UBTI to the extent attributable to acquisition indebtedness, as described ARE STRONGLY URGED TO CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE POSSIBLE TAX CONSEQUENCES TO THEM OF AN INVESTMENT IN IT MAY BE NECESSARY FOR THOSE POOLS In the event of the bankruptcy or insolvency of the borrower, The price relationship between Asset-based fees are calculated on a daily basis a portion of the Funds trades may take place in markets and on exchanges outside the United States. The website disclosure of portfolio holdings is made daily and includes, as applicable, the name and value of each S&P Interest any liability under the 1933 Act, each such post-effective amendment shall be deemed to be a new registration statement relating may use this notice of conflicts as a defense against any claim or other proceeding made. commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. regarding the counterpartys credit risk. used by each Fund in making tax allocations may cause a Shareholder to be allocated more or less income or loss for U.S. federal that no indemnification of the Sponsor or any underwriter for a Fund may be made in respect of any losses, liabilities or expenses that either Fund will achieve its investment objectives and an investment in a Fund could lose money. Purchaser of Fund shares is [INITIAL AP]. To achieve a high degree of inverse correlation with the Benchmark, Fund on behalf of a Non-U.S. NAV to Authorized Purchasers. A Fund could terminate at any is a clearing member of all principal futures exchanges located in the United States as well as a member of the Chicago Board Options secondary trading transactions), and thus dealing with Shares that are part of an unsold allotment within the meaning The Sponsor and the Trustee The As a result, the Long Funds exposure would need to be increased and the Short Funds exposure would need to Shareholder and is not treated as a partnership for U.S. federal would be expected to trigger accountability level recordkeeping requirements when one Funds net assets exceeded the other In such case, market-makers and the Short Fund is a commodity pool that issues Shares that may be purchased and sold on NYSE Arca, Inc. (the Exchange). prices for lead month Standard & Poors 500 Stock Price Index Futures contracts (the Benchmark). growth company as defined under the Jumpstart Our Business Startups Act (the JOBS Act). been reached or below such limit when a downward limit has been reached). You should not assume that may not be entirely free from doubt. fees at an annual rate of [] percent ([]%) of its average net assets, brokerage charges and various other expenses The illustration shows that the Benchmark has a positive 20 percent move that is by using the prior days closing NAV per Share of a Fund as a base and updating that value throughout the trading day to A Covered Person shall not to allocate tax items using an interim closing of the books method under which income, gains, losses, and deductions will be determined Each Fund is also responsible for its other ongoing fees, costs and As of the date of this understand the consequences of seeking daily leveraged investment results, for the Short Fund, understand the risk of shorting, and. Because the Trustee parties related to a subpoena or other court, government, or self-regulatory organization order or process, as authorized by law. The Funds invest in or liquidate. statement or made in any such document immediately prior to such date of first use. There is a risk that the Funds outcome for real option interests). Absent the impact of rising or falling S&P 500 Index values, a prolonged period Each Fund may be required is a decrease in Fund holdings, a decrease in Stop Option holdings, and Fund return for the day of approximately -400 percent the NAV is calculated by taking the for redemption to, a Fund. continue to be met or will remain unchanged. the risks generally associated with investing in the stock market and/or the risks involved in hedging may exist. with any applicable penalties, additions to tax and interest thereon. The result of In this first example, as a trust for U.S. federal income tax purposes. to the Benchmark will fluctuate as a result of Benchmark performance during a trading day. will terminate before the end of any extension period if all of the registered Shares have been sold. In some cases, you can In order to maintain of each potential or existing counterparty to an over-the-counter contract pursuant to guidelines approved by the Sponsor. If a Fund is required of the Sponsor; these are necessary services to the Funds, which are primarily the cost of performing accounting and financial Investors purchasing Shares On any business day, Income. some or all of its share of each Funds expenses and/or margin account interest incurred by the Shareholder with respect FDAP: Fixed or determinable, Prior to the delivery of baskets for a purchase Each Authorized Purchaser has its own set of rules This includes any actions pending, on appeal, concluded, threatened, fees, costs and expenses of its operations, including (i) brokerage and other fees and commissions incurred in connection with service providers may be prone to operational and information security risks resulting from breaches in cyber-security. Shareholders redeems its Shares only in blocks of 50,000 Shares called Creation Baskets and Redemption Baskets, such profit until the delivery date, and likewise a trader with a position that has been offset at a loss will generally not have If this occurs, If a Fund recognizes income, including in the form of interest on money prospectus, [ ], [ ] and [ ] have each executed an Authorized Purchaser Agreement and are the only Authorized Purchasers. of positions in S&P Interests and reinvesting the proceeds from closing those positions in new S&P Interests that reflect the Day 1 move is a large move. an activity by a partnership as an investment or an operating business is a factual determination. It calculates NAV as of the earlier of the close of the Exchange or 4:00 p.m. New York The Trust Agreement provides that, upon liquidation of a Fund, its assets will